Greek minister insists global aid on its way

Updated 10 November 2012
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Greek minister insists global aid on its way

ATHENS: Brussels gave a much needed boost to Greek Finance Minister Yannis Stournaras yesterday as he sought to reassure Greeks that a long-delayed installment of crucial international aid was well on its way.
Stournaras said “there is no reason to worry” even as a four-billion-euro debt payment loomed and Germany warned that a deal on the aid could be weeks away.
An EU official in Brussels backed Stournaras assuring that international creditors would not allow Greece to default on its debt and were ready to give Athens two extra years to put its house in order.
“There will be no default, not accidental, not premeditated,” said the source, who spoke on condition of anonymity.
Two days after Greek Parliament passed a new round of austerity, Stournaras stressed that “Greece is doing what it has to do, and so is Europe, the tranche will be paid.”
Stournaras said Athens expected a decision on the funds at a meeting of euro zone finance ministers on Monday, although media reports said the aid decision could be delayed to Nov. 26.
Approval of the a new loan slice for Greece will top the agenda at that meeting in Brussels, which comes a day after Greek lawmakers are to vote on the 2013 budget.
Greece is surviving at present on two huge bailout packages from the European Union, International Monetary Fund and European Central Bank.
Private creditors also agreed in March to erase more than 100 billion euros ($127 billion) in the Greek public debt they held.
Analysts at Fitch Ratings said that approval by the Greek parliament late Wednesday of an additional 13.5 billion euros in austerity measures “shows that the near-term risk of Greece leaving the euro zone has receded.”
Capital Economics said: “We’re throwing in the towel on a Greek euro exit in 2012. But that’s a matter of timing, not a change in our fundamental position on Greece or on the broader debt crisis.”
On Thursday, European leaders welcomed the Greek parliament’s adoption of a package of more than 18 billion euros in new cuts and reforms, but German Finance Minister Wolfgang Schaeuble warned that there might not be a aid deal for weeks.
Greek newspapers on Friday criticized delays in securing the latest aid tranche, which has been frozen since June, with one daily accusing the creditors of “blackmail”.
“They are making fun of Greece,” the radical left newspaper Avghi charged. The left-wing Eleftherotypia newspaper accused Greece’s partners of “blackmail right up to the end”.
The liberal Kathimerini newspaper said the delay was the result of the EU’s “inability to reach agreement with the IMF on a compromise on the viability of Greek debt.”
Meanwhile, Greece’s public debt management agency PDMA said it would make a special debt issue worth 3.125 billion euros in one- and three-month treasury bills to help cover debt payments due on November 16.
The last-minute operation is meant to help Greece reimburse 4.1 billion euros on that date, given that Athens might not have received the 31.5 billion euros tranche due from international creditors.
Greece’s total debt is forecast to swell to 346 billion euros next year or almost 190 percent of economic output, while the economy is projected to shrink by a worse than expected 4.5 percent, which would mark its sixth year of recession.
A European Commission spokesman said Thursday the latest Greek austerity plan only clears the way for further talks on the country’s financing needs.
The austerity measures — which have triggered general strikes and sometimes violent protests by angry Greeks — include further salary cuts for public workers, a rise in the retirement age to 67 and pension cuts as well as planned deregulation of the labor market.
In late trading on Friday, the Athens stock market’s ASE index showed a gain of 0.97 percent to 802.37 points.


Iran rial plunges to new lows as US sanctions loom

Updated 24 June 2018
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Iran rial plunges to new lows as US sanctions loom

  • The dollar was being offered for as much as 87,000 rials, compared to around 75,500 on Thursday
  • The currency has been sliding for months because of a weak economy

DUBAI: The Iranian rial plunged to a record low against the US dollar on the unofficial market on Sunday, continuing its slide amid fears of returning US sanctions after President Donald Trump in May withdrew from a deal on Tehran’s nuclear program.
The dollar was being offered for as much as 87,000 rials, compared to around 75,500 on Thursday, the last trading day before Iran’s weekend, according to foreign exchange website Bonbast.com, which tracks the unofficial market.
Iran’s semi-official news agency ISNA said the dollar had climbed to 87,000 rials on Sunday from about 74,000 before the weekend on the black market, and several Iranian websites carried similar reports.
The currency has been sliding for months because of a weak economy, financial difficulties at local banks and heavy demand for dollars among Iranians who fear the pullout by Washington from the nuclear deal and renewed US sanctions against Tehran could shrink the country’s exports of oil and other goods.
The fall of the national currency has provoked a public outcry over the quick rise of prices of imported consumer goods.
Merchants at the mobile phone shopping centers Aladdin and Charsou in central Tehran protested against the rapid depreciation of the rial by shutting down their shops on Sunday, the semi-official news agency Fars reported.
A video posted on social media showed protesters marching and chanting “strike, strike!” The footage could not be authenticated independently by Reuters.
Hours later, Information and Communications Technology Minister Mohammad Javad Azari-Jahromi said on Twitter that he visited the protesting merchants.
“I will try to help provide hard currency for (mobile) equipment (imports),” Azari-Jahromi wrote, adding: “The merchants’ activity has now gone back to normal.”
Some of the US sanctions against Iran take effect after a 90-day “wind-down” period ending on Aug. 6, and the rest, most notably on the petroleum sector, after a 180-day “wind-down” period ending on Nov. 4.
The rial has weakened from around 65,000 rials just before Trump’s announcement of the US withdrawal in early May, and from 42,890 at the end of last year — a freefall that threatens to boost inflation, hurt living standards and reduce the ability of Iranians to travel abroad.
In an effort to halt the slide, Iranian authorities announced in April they were unifying the dollar’s official and black market exchange rates at a single level of 42,000, and banning any trade at other rates under the threat of arrest.
But this step has failed to stamp out the unofficial market because authorities have been supplying much less hard currency through official channels than consumers are demanding. Free market trade simply went underground, dealers said.