Greek opposition leader says would join coalition with Tsipras

Evangelos Meimarakis, leader of the opposition New Democracy party, said he'll invite his rival Alexis Tsipras to form a coalition to safeguard Greece's place in the euro area, no matter the outcome of this month's vote. 

PHOTO: REUTERS

SEP 7, 201512:47 PM

[ATHENS] Evangelos Meimarakis, leader of the opposition New Democracy party, said he'll invite his rival Alexis Tsipras to form a coalition to safeguard Greece's place in the euro area, no matter the outcome of this month's vote.

"I believe in consensus and cooperation," Mr Meimarakis, 61, said in a Bloomberg television interview on Sunday. "We have proven throughout these years that when it's for the good of the country, for safeguarding its place in the euro area, we're willing to cooperate."

Opinion polls over the weekend showed the third ballot in Greece this year is too close to call as Mr Tsipras' Syriza party is tied with New Democracy. No party is projected to gain enough votes for an outright parliamentary majority, signaling coalition talks may be needed.

The prospect of messy negotiations could further complicate the implementation of conditions set out for the third bailout to stave off the crisis and the recapitalisation of banks.

Mr Tsipras stepped down on Aug 20 just after relying on opposition votes to gain parliamentary backing of the country's third bailout.

His resignation was a bid to recoup a majority with snap elections as his party fell into disarray and dissidents formed a splinter group. Mr Tsipras last month said that his choice to opt for a compromise with creditors in the face of internal dissent was necessary to avert the "national disaster" of expulsion from the euro. Stocks have plunged since markets reopened in August.

Every poll over the past week has Syriza and New Democracy within the margin of error, including an MRB survey on Saturday in Parapolitika newspaper that gave New Democracy a 0.6 percentage point lead, and a Marc poll published the next day in To Ethnos daily that had Syriza ahead by 0.4 percentage point.

Mr Meimarakis said European leaders are wrong if they are betting that Mr Tsipras offers the best hope of keeping the region's common currency area together.

Government officials in Paris and Berlin last week said the Syriza leader has built up trust with President Francois Hollande and Chancellor Angela Merkel over months of late-night sessions as they worked on a deal to secure Greece's future in the euro.

"Even if Tsipras wins the election, which he will not, he will face similar internal dissent problems each time he brings a law implementing the bailout agreement," Mr Meimarakis said.

"The danger of Grexit hasn't passed, and if we end up in an unstable situation, this danger will become more imminent."

New Democracy would instead safeguard the implementation of the bailout agreement and pass needed reforms, Mr Meimarakis, who succeeded Antonis Samaras, said from his office on Syggrou Avenue, in Athens.

New Democracy, along with the Pasok and River parties, backed Mr Tsipras' 86 billion euros (S$136.7 billion) bailout deal, after about a quarter of Syriza's lawmakers staged a mutiny against its terms. The country has had seven prime ministers in the past six years.

"There was no need to hold snap elections and Mr Tsipras owes an explanation for putting the country into this adventure, and bringing uncertainty and instability during the most crucial moment in the implementation of the program," said Mr Meimarakis. "It's disastrous to hold elections every six months."

Mr Tsipras is Europe's "pampered kid" after he went "crying" to seek the bailout," Mr Meimarakis said. "It's one thing to be a good kid, and quite another to be a statesman." So strong is his belief in Europe that Mr Meimarakis said he would forgo any leaderships claims, even if he wins the elections, if that's seen as needed to form a credible coalition.

"Tsipras has called us assassins of society, traitors; he used derogatory expressions against us," Mr Meimarakis said. "Despite this, we backed him when we thought the country's European prospect was at stake."

BLOOMBER
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Queen Elizabeth II goes low-key for record reign landmark 

Queen Elizabeth II is planning to keep things low-key on Wednesday when she will overtake Queen Victoria as Britain's longest-serving monarch, despite public interest in the historic date. 

PHOTO: EPA

SEP 7, 201512:06 PM

[LONDON] Queen Elizabeth II is planning to keep things low-key on Wednesday when she will overtake Queen Victoria as Britain's longest-serving monarch, despite public interest in the historic date.

The queen will ride on a steam train in Scotland to inaugurate a new railway line and will host a dinner at Balmoral Castle with her grandson Prince William and his wife Kate in attendance.

According to calculations by royal officials, at around 1630 GMT Elizabeth will beat her great-great grandmother Victoria's time on the throne: a total of 63 years, seven months and two days which she served between 1837 and 1901.

The exact hour has been difficult to determine because the exact start of her reign - the moment when her father George VI passed away - is difficult to work out as the king died at night in his sleep.

The 89-year-old Elizabeth, also the world's oldest monarch, had originally not planned anything special for the day itself but reportedly agreed to a public appearance due to public pressure.

"You need to remember for the queen this is a date whose calculation rests on the death of her father and great-great grandmother. That naturally colours the way she sees it," a royal source said.

"While she acknowledges it as an historic moment, it's also for her not a moment she would personally celebrate, which is why she has been keen to convey business as usual, and no fuss," the source said.

Buckingham Palace will mark the day with a photo display of her reign and the Royal Mint has designed a new silver £20 coin (S$43.20) with the five official portraits since she became queen in 1952.

NEW ELIZABETHAN AGE?

Historian David Starkey said the queen's style, inherited from her father King George VI, and grandfather King George V, had helped "established a record of unimpeachable integrity".

He said her refusal to comment on controversial issues had deprived "republicanism of the necessary oxygen of controversy".

However, it also meant she had "done and said nothing that anybody will remember" and she would therefore "not give her name to her age" as Victoria did, the historian wrote in the Radio Times.

By contrast, fellow historian Andrew Gimson argued that Elizabeth's reign "will be seen as an incredible accomplishment," spanning a period "marked by many major social and economic changes".

These changes saw Britain's global influence, which peaked during Victoria's reign, diminish as the empire gave way to independence.

It was a process already under way when Elizabeth came to the throne, as the country was rebuilt after the trauma of World War II.

She then witnessed Europe draw closer together, eventually leading to the formation of the European Union, but also saw turmoil at home as Britain's economy collapsed during the 1970s.

Over the Irish Sea, the Troubles raged in Northern Ireland for decades of her reign, eventually being brought to an end by the 1998 peace agreement, while mass immigration changed the face of the country.

'STILL POINT' IN STORMY WORLD

The 1990s were her toughest years as a series of crises and a less-deferential society led to serious doubts about the future of the family.

Three of her four children went through highly public divorces, and she appeared out of touch with modern Britain with her muted response to the 1997 death of Princess Diana, former wife of Prince Charles, as the rest of the country mourned.

But she was able to ride the storm, and a series of recent good-news stories such as the wedding of William and Kate, the birth of their two children George and Charlotte and a diamond jubilee have all helped boost her popularity.

The birth of George meant there are now four generations of present and future rulers of Britain alive at the same time, for the first time since Victoria's reign.

Prince Charles, 66, is also a record-holder thanks to his mother's longevity, having three years ago become the longest-waiting heir to the British throne.

For Daily Telegraph pundit Allison Pearson, he will have large shoes to fill.

"A still point in a tumultuous world, the clock face over which the hands of time revolve, she has been with us for as long as we can remember," she wrote.

AFP

      

Greek crisis prompts a rethink on food waste

With little end to their economic misery in sight, Greeks are finding inventive ways to feed the poor while also fighting waste - a movement that is chipping away at traditional attitudes to food. 

PHOTO: AFP

SEP 7, 201511:56 AM

[ATHENS] With little end to their economic misery in sight, Greeks are finding inventive ways to feed the poor while also fighting waste - a movement that is chipping away at traditional attitudes to food.

Three years ago, Xenia Papastavrou came up with a simple idea: take unsold food from shops and restaurants that was headed for the bin, and use it to feed the growing number of Greeks going hungry as the financial crisis took hold.

"In June, they gave us 3,000 kilos of melons; in August we got 7,200 cartons of milk," the 39-year-old told AFP at her office behind Athens' central market.

Boroume ("We Can"), the organisation she founded, matches donated foodstuffs with charities in need - whether vegetables, bread or "even these 12 tiropita (cheese pies), which weren't sold at the bakery".

These days the food routed through Boroume provides an average of 2,500 meals a day across Greece, from Athens to Thessaloniki in the north.

"Greece is a country that throws a lot away," explained Ms Papastavrou from behind a computer screen covered with data tables and the addresses of charities.

In Greek tavernas, if the plates aren't piled with huge pyramids of food, a meal between friends can be considered a failure, she added.

"There isn't really a mentality of paying attention to this," she said. "Here, it's: 'I've paid for it, so I can do what I want with it.'" But years of hardship have started to change habits in a country where official figures show a quarter of the population is at risk of poverty.

"In Greece, people used to think that good quality means high prices," said Tonia Katerini, an architect who spends about 10 hours a week working in the Sesoula co-operative grocery store in Exarchia, downtown Athens.

But as Greece slumped into a deep six-year recession after the 2008 financial crisis erupted, people began thinking harder about whether this was really true, she said.

'POTATO MOVEMENT'

The rice, lentils and olive oil on the shelves at the grocery are "on average 10 to 15 per cent cheaper than in the supermarket," said Ms Katerini.

To achieve this, the grocery - like the 11 other cooperatives of its kind that have sprung up in Athens in recent years - skips the middlemen and negotiates directly with producers.

The idea was born three years ago with the rise of Greece's so-called "potato movement." Unhappy with the profits that wholesalers were making at their own expense, farmers began selling straight to the customers, offering sacks of potatoes from the backs of their trucks.

The result: bigger profits for the farmers, and lower prices for families trying to scrape together dinners as unemployment soared.

"This crisis has forced us to end the 'each man for himself' mentality, to look at what we can do together to get ourselves out of this mess," said Ms Katerini.

With the government forced to implement huge spending cuts in exchange for two international bailouts since 2010, families are bearing the brunt of supporting the quarter of the population who are unemployed.

But families cannot cope on their own, Ms Katerini and Ms Papastavrou both say.

At a time when parents' pensions are being cut as part of a huge third international financial rescue, and with many families having used up the savings they had put aside for a rainy day, society must step in, Ms Katerini said.

As Greece's third bailout plan begins, the queues at soup kitchens have grown longer. Many visitors are elderly, but increasingly, mothers are among those in line.

Some, hoping to shield their children from the grim reality, arrive with casserole dishes in their hands "to make their kids believe they made the meals themselves," said Ms Papastavrou.

Six years ago, 80 people came regularly to the soup kitchen in Athens' middle class Zografou neighbourhood. Today, there are 500.

"So you see how important it is for us to help each other," said Ms Papastavrou.

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Indonesia to not relax mineral export ban in new stimulus policy package

      

Indonesia will not relax its ban on mineral exports in its upcoming economic stimulus policy package, the country's mining minister said on Monday. 

PHOTO: BLOOMBERG

SEP 7, 201511:27 AM

[JAKARTA] Indonesia will not relax its ban on mineral exports in its upcoming economic stimulus policy package, the country's mining minister said on Monday, referring to an earlier proposal to allow nickel and bauxite shipments to spur smelter developments.

"The risks of these incentives are bigger so the plan has been cancelled," Minister Sudirman Said told reporters, adding that risks included legal and environmental issues.

Indonesia is working on a stimulus package to spur economic growth.

REUTERS

China cuts 2014 GDP growth from 7.4% to 7.3%: govt

China on Monday lowered its GDP growth figure for last year by 0.1 percentage points to 7.3 per cent, official figures showed 

PHOTO: REUTERS

SEP 7, 201510:32 AM

[BEIJING] China on Monday lowered its GDP growth figure for last year by 0.1 percentage points to 7.3 per cent, official figures showed, as concerns mount over slowing growth in the world's second-largest economy.

The National Bureau of Statistics said on its website it lowered the figure from the 7.4 per cent announced in January after a “preliminary confirmation”.

The new figure remains the lowest since 1990, when growth plummeted to 3.9 per cent.

Global stock markets have been pummelled by concerns over slowing growth in China, a key driver of the world economy.

After decades of double-digit expansion authorities are trying to pull off a tricky rebalancing from an investment- and export-led economic model to one where domestic consumer demand drives slower but more sustainable growth.

But an official Chinese manufacturing survey last week sent world markets into a tailspin, as investors gave vent to worries China’s economy is headed for a “hard landing”.

Chinese growth slowed in first two quarters of this year, reaching 7.0 per cent in both periods.

Investors were also alarmed by authorities’ surprise lowering of the yuan currency’s central rate against the US dollar by nearly five per cent in a single week last month.

   
 

Indonesia more exposed to capital flight than Malaysia: S&P

Rocked by a political scandal and falling oil prices, Malaysia has been dominating headlines in recent months as the ringgit leads a drop in Asian currencies. 

PHOTO: BLOOMBERG

SEP 7, 201510:32 AM

[SINGAPORE] Rocked by a political scandal and falling oil prices, Malaysia has been dominating headlines in recent months as the ringgit leads a drop in Asian currencies.

That's taken the spotlight off the economy of neighbouring Indonesia, which Standard & Poor's says is more exposed to capital flight.

"The thing about Malaysia is that the capital market is deeper there, so there's less reliance on foreign capital among corporates or banks to fund their growth," said Kyran Curry, S&P's director of sovereign ratings in Singapore. "Indonesia is much more vulnerable to shifts in outflows and inflows. We're worried about Indonesia's foreign-exchange reserves."

Bank Indonesia's reserves have fallen almost 7 per cent in the five months though July. While that's less than in Malaysia, Mr Curry says he's concerned as the monetary authority in Jakarta has recently been "spending a lot to stabilise volatility in the currency."

The rupiah has weakened 4.5 per cent since the end of July, less than half the 10 per cent slide in the ringgit, as China's devaluation of the yuan spurred depreciation in the region.

Indonesian stocks and local-currency sovereign bonds have fallen faster than Malaysia's over the last three months even though the latter country, a net oil exporter, has been hurt more by the falling price of Brent crude and allegations of corruption against Prime Minister Najib Razak.

The government in Jakarta has been buying back its own sovereign bonds and encouraging state-owned companies to purchase their shares to stem declines.

FUND FLOWS

"The government is doing things and the central bank is working to try and deepen the local capital market but it's taking a long time to develop," said Mr Curry. "The capital market in Malaysia is much larger and deeper."

Indonesia's benchmark stock gauge lost 13 per cent over the past three months, compared with a 10 per cent drop in Malaysia.

The two countries' local-currency bonds are the only decliners in Asia over the period. Malaysia's have dropped 0.7 per cent and Indonesia's have fallen 1 per cent, according to Bloomberg indexes.

Foreign funds have pulled US$467 million from Indonesian shares this year after pumping a net US$3.8 billion into the securities in 2014, exchange data show. Some RM16.4 billion (S$5.42 billion) has been taken out of Malaysian stocks this year, following RM6.9 billion of outflows in 2014.

With the highest yields in emerging-market Asia, Indonesia's local-currency sovereign bonds are popular with overseas investors, who own almost 38 per cent of them. The ratio in Malaysia is 32 per cent, according to data compiled by Bloomberg.

"Malaysia never had the massive inflows that Indonesia had over the course of the last few years," said S&P's Curry.

Neither Indonesia nor Malaysia's credit ratings are under any immediate threat, he said. S&P is the only one of the three big rating companies that doesn't rank Indonesia as investment grade, assigning the country its top junk rating of BB+. It assesses Malaysia four levels higher at A- with a stable outlook. Indonesia's outlook could be changed to stable from positive if macroeconomic imbalances arise or if the current administration's reform push wanes, Mr Curry said.

SOUNDER FOOTING

Malaysia's economy is on a sounder footing than Indonesia's, said Stuart Allsopp, head of Asia country risk and financial markets strategy at BMI Research in Singapore.

Malaysia recorded a current-account surplus of US$1.8 billion in the second quarter at the current exchange rate, while Indonesia posted a deficit of US$4.48 billion, official data show. In contrast to Indonesia, Malaysia also has a positive net international investment position, said Mr Allsopp.

"This means that if the dollar strengthens due to Fed rate hikes, Indonesia finds the local-currency value of its external debts have increased, making it more difficult to repay them," he said. "In the case of Malaysia, its external assets rise concomitantly so the net impact is very little."

Prime Minister Najib is grappling with allegations of financial irregularities at state investment company 1Malaysia Development Bhd, and facing accusations of impropriety after it was disclosed that more than US$600 million of political donations ended up in his private accounts in 2013.

Mr Najib denies taking money for personal gain and has counterattacked against what he described as a campaign to oust him, by reshuffling his cabinet and suspending a leading newspaper.

Barclays Plc is recommending clients be underweight Malaysian bonds and is neutral on Indonesian debt, said Rohit Arora, a Singapore-based rates strategist for emerging Asia at the UK-based lender.

MAINTAIN BUFFERS

"We're equally concerned on both, but looking at the terms of trade and cyclical weakness in commodity prices, then the ringgit looks more vulnerable than the rupiah," said Singapore-based Arora. Indonesia's "domestic markets aren't deep enough, which means it relies more on foreign funding compared with any other market in the region," he said.

That reliance on offshore funds leaves the country exposed when the Fed starts raising interest rates and if China's economic slowdown worsens.

At the moment the main risk is central banks "panicking and putting a lot of money into supporting currencies and burning through their reserves," said S&P's Curry. It's important to maintain buffers should the external environment weaken further, he said.

BLOOMBERG

    
 

Ringgit falls to new low since 1998 after US jobs data, oil price drop

The ringgit fell to a new 1998 low as oil prices extended their decline and after a report showed the US jobless rate was at its lowest in seven years, adding weight to the Federal Reserve's plan to raise interest rates. 

PHOTO: BLOOMBERG

SEP 7, 20159:29 AM

[KUALA LUMPUR] The ringgit fell to a new 1998 low as oil prices extended their decline and after a report showed the US jobless rate was at its lowest in seven years, adding weight to the Federal Reserve's plan to raise interest rates.

Brent crude extended last week's drop and has halved in price during the past 12 months, cutting government revenue for oil-exporting Malaysia. While the US unemployment rate touched 5.1 per cent in August, the lowest level since 2008, the rise in the non-farm payrolls numbers was less than forecast, according to official data on Sept 4. Higher US borrowing costs risk increasing capital outflows from emerging markets, just as slowing Chinese economic growth is curbing risk appetite.

"China's growth fears and Fed rate lift-off concerns are to blame for emerging currencies' weakness," said Sim Moh Siong, a foreign- exchange strategist at Bank of Singapore Ltd. in the city-state. "Emerging-market currencies on the whole were badly hit amid risk-off in financial markets." The ringgit weakened 1 per cent to 4.3030 a dollar as of 9:10 am in Kuala Lumpur, according to prices from local banks compiled by Bloomberg. It earlier fell to 4.3100, the lowest level since January 1998 when it reached a record 4.8850. The currency dropped 1.4 per cent last week, an 11th straight weekly decline that was the longest since 1993.

Malaysia's central bank meets at the end of this week, with eight of nine economists surveyed by Bloomberg predicting no change in the benchmark interest rate from 3.25 percent. One expects a 25 basis-point increase. A report last Friday showed the nation's foreign-exchange reserves climbed to US$94.7 billion in the last two weeks of August. The holdings were at US$94.5 billion in the previous two weeks, the lowest level since 2009, and a signal the central bank may have been intervening to stem a slide in Asia's worst-performing currency this year.

The falling reserves are a constraint on how much the authorities can intervene to support the ringgit, Bank of Singapore's Sim said.

The odds for a rate increase at this month's Fed meeting were 30 per cent, 43 per cent for a move in October and 58 per cent for December. Non-farm payrolls climbed 173,000 in August, less than the 217,000 forecast in a Bloomberg survey and a revised 245,000 in the previous month.

BLOOMBERG

    
 

Dollar nurses losses after US jobs offer little clarity on Fed move

The dollar nursed its losses on Monday, after dropping on mixed US employment data that failed to bring much clarity as to the timing of the US Federal Reserve's long-awaited interest rate hike. 

PHOTO: BLOOMBERG

SEP 7, 20158:41 AM

[TOKYO] The dollar nursed its losses on Monday, after dropping on mixed US employment data that failed to bring much clarity as to the timing of the US Federal Reserve's long-awaited interest rate hike.

Nonfarm payrolls rose a less-than-expected 173,000 last month, a slowdown from July's upwardly revised gain of 245,000 and the smallest rise in five months. But the unemployment rate dropped to a near 7-1/2-year low and wages accelerated. "The problem is that these numbers are probably consistent with 2 to 2.5 per cent GDP growth at best, good enough to begin the normalization of US rates but not good enough to serve as a locomotive for the rest of the world," Steven Englander, global head of foreign exchange strategy at Citi, said in a note to clients.

The figures came against a backdrop of anxiety about falling global equities and China's slowing economy, which have led investors to pare back bets that the Fed would raise interest rates as early as at its meeting this month.

Trading activity was likely to be thinner than usual on Monday, with US markets closed for the Labor Day holiday.

The dollar added about 0.1 per cent against the yen to 119.18, moving away from its session low of 118.60 on Friday, when it sank 1 per cent.

The euro gained about 0.1 per cent to US$1.1149. The European common currency has benefited as investors unwound euro-funded carry trades, in which they borrowed euros to invest in high-yielding currencies.

Data from the Commodity Futures Trading Commission released on Friday and Reuters calculations showed that speculators further cut back bullish bets on the US dollar in the week ended Sept 1 for the second straight week, to their lowest level since July last year.

The dollar skidded to a seven-month low of 116.15 yen on Aug 24, while the euro rose as high as US$1.1715, as China-driven panic gripped markets around the world.

The European Central Bank warned last week that growth would suffer from fading momentum in emerging markets, particularly China, and falling oil prices could drag the 19-member euro zone back into deflation in coming months.

After the ECB left rates unchanged as widely expected, ECB President Mario Draghi explicitly said for the first time that the bank's bond-buying programme may run beyond its end-date of September 2016, and that its size and composition might be adjusted.

The dollar index, which measures the greenback against a basket of rival currencies, was nearly flat from Friday's late US levels at 96.209, and well ahead of last month's seven-month low of 92.621.

REUTERS

    
 

China stocks regulator says to deepen reforms, markets more stable

China's stocks regulator said it plans to deepen reforms and bolster supervision of the market, including looking into a stock index "circuit breaker" system that would halt trading in response to substantial drops.

PHOTO: REUTERS

SEP 7, 20158:33 AM

[SHANGHAI] China's stocks regulator said it plans to deepen reforms and bolster supervision of the market, including looking into a stock index "circuit breaker" system that would halt trading in response to substantial drops.

The China Securities Regulatory Commission (CSRC) said in a post on its official microblog late on Sunday that the country's markets were more stable and risks associated with high levels of leverage have eased following a period of high volatility.

China's stock markets have fallen around 40 per cent since mid-June, spooking global markets and investors, and prompting a raft of counter measures from Beijing to stem the drop. "The government won't normally intervene, but when there are severe, abnormal fluctuations in the markets, the government can't just sit on the sidelines and must take decisive and timely measures to stabilize the market," the statement said.

The CSRC added that state margin lender China Securities Finance Corp would continue to support market stability through various means
.