NEWS,05.07.2013

Russian PM sacks ally of oil boss Sechin

Russian Prime Minister Dmitry Medvedev on Friday sacked a senior resources official, believed to be a close ally of Igor Sechin, the boss of state oil firm Rosneft, in a move analysts said was a sign of growing confrontation between the two men.
In an order published on Friday Medvedev dismissed Alexander Popov, the head of Rosnedra, an agency responsible for granting licences to develop natural resources.
Popov was an aide to Sechin when Sechin oversaw Russia's energy sector as deputy prime minister.
Sechin, a close ally of Russian President Vladimir Putin, was last year appointed to head Rosneft, the world's largest publicly listed oil producer, majority-owned by the Kremlin.
Sechin's confrontation with Medvedev's team has grown since then as Sechin has embarked on an aggressive consolidation of assets under Rosneft's control. Medvedev's deputy for energy, Arkady Dvorkovich, has pushed for more privatisation and lower state interference in the strategic industry.
A more recent spat came over a decision by Rosnedra to awarded Rosneft and state gas major Gazprom licenses to tap oil and gas fields in the Arctic, which Dvorkovich has criticised.
Medvedev is also a close ally of Putin and was Russian president when Putin had to step down from the Kremlin as demanded by the constitution after two consecutive terms as president in 2008. Putin appointed Medvedev as prime minister when he returned to the Kremlin in 2012.
"It is clear that the confrontation between Medvedev-Dvorkovich on one hand and Sechin on the other is growing, and all means may be used in that fight," political analyst Stanislav Belkovsky said about Popov's dismissal.
Medvedev's order said Popov was dismissed because his post was being eliminated. In a separate decree Medvedev named Valery Pak as deputy minister of natural resources and the head of Rosnedra.
"Sechin still enjoys great political clout. This (change in Rosnedra) won't undermine his power," Andrey Polishchuk, an analyst with Raiffeisenbank in Moscow said.

Monetary divide to drive dollar surge

US monetary policy is zigging while the rest of the world is zagging, and the world should brace for a protracted dollar surge, more strains for developing economies and volatility in global markets.
After two weeks of signalling by central banks, investors are betting the Federal Reserve will raise US interest rates within 14 months. No similar move is seen in the euro zone, Britain or Japan before 2016 at the earliest  the first major divergence in rate expectations for five years.
Prospects of less Fed money printing and the European Central Bank's promise this week to keep interest rates low have already pushed the gap between US and German 10-year government bond yields to its widest since 2006.
The developing policy gap, and the United States' stronger economic outlook, means many investors are starting to assume the dollar is in the foothills of a mountainous rally.
That could provide a fillip for struggling European and Japanese exporters but would be bad news for emerging economies.
A stronger greenback has a depressive impact on dollar-priced commodities, raises dollar borrowing costs for companies and developing countries, and may ultimately stem the flow of US investment overseas.
Almost half the world's $80 trillion of private pension, insurance and mutual fund savings originates in the United States, and long-term shifts in the dollar's exchange rate can profoundly change their calculation of overseas returns and hence their preference for home or foreign markets.
"It's potentially going to have a big impact on the dollar and US fund managers who are the biggest investors in the global economy," said UBS strategist Manik Narain.
"They have been orchestrating the big inflows into emerging markets and now for the first time in 13 years they are seeing real US interest rates are on the rise."
The dollar has risen sharply against Japan's yen and emerging market currencies all year, but the latest shift in monetary outlooks within the developed world looks likely to push it up against the euro, sterling and other G7 currencies.
"We're big proponents of a stronger dollar it's the central investment thesis of this period," said Scott Thiel, head of global bonds at the world's biggest asset manager, BlackRock which has almost $4 trillion under management.
Others say the order in which countries were sucked into the global crisis is the main issue. But dollar strength still emerges under that scenario.
"There's potential for the appreciation of the dollar versus the euro and also against Asian currencies," said Arnaud de Servigny, chief investment officer at Deutsche Bank Wealth Management. "The entry into the crisis was the US first, followed by Europe, followed by Asia. Now the first out is the US, followed by Europe, and there's some uncertainty in Asia."
Historic shift
Prolonged periods of broad dollar strength have been few and far between since exchange rates were allowed to float in 1973.
Seismic dollar swings in the 1980s also resulted from mismatched economic cycles and monetary policies either side of the Atlantic and were met with bouts of central bank intervention, first to cap the dollar and then to stall its subsequent collapse.
Investors are looking at 1994 as a parallel for the present. Surprise Fed rate rises that year pushed bond yields higher everywhere, even as Germany's Bundesbank - then Europe's most powerful central bank - was furiously easing policy.
The interest rate gap peaked in 1995, the trigger for six years in which the dollar - still the world's main reserve currency - appreciated more than 40 percent on the Fed's broad trade-weighed index.
While the dollar has been gaining strength, the Fed's broad dollar index has risen only 4% so far this year.
The late 1990s saw major crises in emerging markets as dollar strength tightened global financial conditions and depressed world commodity prices, and as US money returned home to what was seen as a relatively safe high-growth story in Silicon Valley.
This week's historic decisions by the ECB and Bank of England to offer "forward guidance" on interest rates stands in contrast to the US Federal Reserve's timetable for less money printing and higher rates over the next two years.
With Japan also still in the midst of a renewed and aggressive monetary easing, the Fed's relatively hawkish leaning looks out of step with its major Group of Seven allies.
And despite attempts by Fed officials to emphasize conditionality, a hefty 195 000 rise in US non-farm payrolls in June will only reinforce that view.
But could a dollar rise itself be enough to make the Fed row back?
Jim O'Neill, former chairman of Goldman Sachs Asset Management and long-term proponent of emerging economies, told Reuters on Friday that the exchange rate fallout may be critical in shaping "reaction functions" around the world.
"The dollar is likely to rise but the Fed doesn't want to preside over a major tightening in financial conditions and so a huge dollar rise may itself contribute to the Fed toning down what it said," said O'Neill.
Big developing countries like China could also help themselves, by further reducing their dependence on the dollar for trade and investment, he added.
"The notion that emerging economies are always vulnerable to the curse of the dollar's exorbitant privilege is in their own (emerging countries') hands."

Greek aid could be split - EU

The next tranche of international aid for Greece could be split into instalments, the EU's top economic official said on Friday, holding out the prospect of a continued hand-to-mouth existence for Greece that threatens to stifle its economy.
Athens had hoped that euro zone finance ministers would sign off on the next €8.1bn tranche of aid when they meet on Monday, although Greek officials have conceded that Greece would not meet targets on reforming its public sector by an end-of-week deadline set by international lenders.
On Friday, however, Olli Rehn, the European commissioner in charge of economic and monetary affairs, confirmed what many officials have expressed privately amid growing frustration with Athens' slow pace of reform, namely, that the tranche could be split into several instalments.
"It is possible, but not certain," Rehn told a seminar in his hometown of Mikkeli, Finland, when asked about the issue. "It all depends on whether Greece can meet all requirements that they are committed to."
He said that talks involving the International Monetary Fund, the European Commission and the European Central Bank, which make up the troika that supervises Greece, would "continue as long as needed".
The euro fell slightly against the US dollar on Rehn's comments to 1.288.
Greece has been kept afloat by emergency loans alone since May 2010, a few months after the start of a debt crisis that sent shockwaves through the eurozone and threatened to push Greece out of the common currency.
The latest instalment is one of the last big cash injections that twice bailed-out Athens stands to receive as part of a €240bn rescue package that expires at the end of 2014. It needs the money in part to redeem about €2.2bn of bonds in August.

But public sector layoffs, which must be implemented alongside state privatisations as a condition of receiving aid, are an incendiary issue in Greece, which is struggling through a sixth year of recession and record high unemployment.

Spain 'told' Snowden was on Bolivia plane

Spain says it and other European countries were told that fugitive NSA leaker Edward Snowden was aboard the Bolivian presidential plane that was diverted to Austria this week, causing a diplomatic row.

Foreign Minister Jose Manuel Garcia-Margallo said on Friday on Spanish National Television "they told us that the information was clear, that he was inside".
The minister did not say who supplied the information and declined to say whether he had been in contact with the United States. But he says European countries' reactions were based on this information.
Bolivia President Evo Morales claims Washington pressured European countries to deny the plane flyover permission on Tuesday on suspicion that Snowden was using the flight as part of his bid to seek asylum.

Iceland rejects Snowden citizenship bid

The parliament of Iceland has rejected a proposal to offer US intelligence leaker Edward Snowden Icelandic citizenship, a parliament spokesperson said on Friday.

The 63-seat parliament late on Thursday voted against the proposal, which had been made by six members of the opposition, including Birgitta Jonsdottir of the Pirate Party and Ogmundur Jonasson, a former interior minister and member of the Left-Green Movement.
In an entry on her blog, Jonsdottir posted a message attributed to Snowden in which he said he had "been left de facto stateless”.
Iceland's centre-right government had already said that Snowden would not be given special treatment, noting that an asylum application would have to be made on Icelandic soil.
Earlier this week, the interior ministry said a fax with an application for asylum that had been sent to Iceland's embassy in Moscow, could not be considered as it was not possible to verify if it had been sent by Snowden.

Similar applications have been sent to 20 other countries.

Snowden makes 6 new asylum applications

Secret-spilling website WikiLeaks says NSA leaker Edward Snowden has put in asylum applications to six new countries as his effort to find refuge from American prosecution falters.

Snowden is believed to be stuck in a Moscow airport transit area and has already sought asylum from more than 20 countries, including Venezuela and Ecuador. Many have since turned him down.
President Barack Obama has publicly displayed a relaxed attitude toward the leaker's movements, but the drama surrounding the flight of Bolivian President Evo Morales - whose plane was abruptly rerouted to Austria over suspicions Snowden was aboard - suggests that pressure is being applied behind the scenes.
WikiLeaks said in a message posted to Twitter on Friday that it would not be identifying the countries involved "due to attempted US interference".

NEWS,13.03.2013

Cardinals opt for seasoned, popular pontiff

In choosing a 76-year-old pope on Wednesday, cardinals clearly decided that they didn't need a vigorous, young pope who would reign for decades but rather a seasoned, popular pastor who would draw followers to the faith.The cardinal electors overcame deep divisions to select the 266th pontiff  Jorge Bergoglio of Argentina in a remarkably fast, five-ballot conclaveBergoglio, who chose the name Francis, became the first pontiff from the Americas and the first from outside Europe in more than a millennium.Looking stunned, Francis shyly waved to the crowd of tens of thousands of people who gathered in St Peter's Square, marvelling that the cardinals needed to look to "the end of the earth" to find a bishop of Rome.Francis asked for prayers for himself, and for retired Pope Benedict XVI, whose surprising resignation paved the way for the conclave that brought the first Jesuit to the papacy."Brothers and sisters, good evening," Francis said to wild cheers in his first public remarks as pontiff."You know that the work of the conclave is to give a bishop to Rome. It seems as if my brother cardinals went to find him from the end of the earth. Thank you for the welcome."Bergoglio had reportedly finished second in the 2005 conclave that produced Benedict - who last month became the first pope to resign in 600 years.After announcing "Habemus Papam" "We have a pope!" - a cardinal standing on the balcony of St Peter's Basilica on Wednesday revealed the identity of the new pontiff, using his Latin name.The longtime archbishop of Buenos Aires has spent nearly his entire career at home in Argentina, overseeing churches and shoe-leather priests.Like other Jesuit intellectuals, Bergoglio has focused on social outreach. Catholics are still buzzing over his speech last year accusing fellow church officials of hypocrisy for forgetting that Jesus Christ bathed lepers and ate with prostitutes.Bergoglio has slowed a bit with age and is feeling the effects of having a lung removed due to infection when he was a teenager.In a lifetime of teaching and leading priests in Latin America, which has the largest share of the world's Catholics, Bergoglio has also shown a keen political sensibility as well as the kind of self-effacing humility that fellow cardinals value highly, according to his official biographer, Sergio Rubin.

He showed that humility on Wednesday, saying that before he blessed the crowd he wanted their prayers for him and bowed his head."Good night, and have a good rest," he said before going back into the palace.Tens of thousands of people who braved cold rain to watch the smokestack atop the Sistine Chapel jumped in joy when white smoke poured out a few minutes past 19:00 local time, many shouting "Habemus Papam!" or "We have a pope!" - as the bells of St Peter's Basilica and churches across Rome pealed.They cheered again when the doors to the loggia opened, and again when Bergoglio's name was announced."I can't explain how happy I am right now," said Ben Canete, a 32-year-old Filipino, jumping up and down in excitement.Elected on the fifth ballot, Francis was chosen in one of the fastest conclaves in years, remarkable given there was no clear front-runner going into the vote and that the church had been in turmoil following the upheaval unleashed by Pope Benedict XVI's surprise resignation.A winner must receive 77 votes, or two-thirds of the 115, to be named pope.For comparison's sake, Benedict was elected on the fourth ballot in 2005 - but he was the clear front-runner going into the vote.Pope John Paul II was elected on the eighth ballot in 1978 to become the first non-Italian pope in 455 years.Patrizia Rizzo ran down the main boulevard to the piazza with her two children as soon as she heard the news on the car radio."I parked the car... and dashed to the square, she said. "It's so exciting, as Romans we had to come."The Vatican spokesperson the Reverend Federico Lombardi said it was a "good hypothesis" that the pope would be installed next Tuesday, on the feast of St Joseph, patron saint of the universal church.Unlike the confusion that reigned during the 2005 conclave, the smoke this time around has been clear: black during the first two rounds of burned ballots, and then a clear white on Wednesday night - thanks to special smoke flares akin to those used in soccer matches or protests that were lit in the chapel ovens.The Vatican on Wednesday divulged the secret recipe used: potassium perchlorate, anthracene, which is a derivative of coal tar, and sulfur for the black smoke; potassium chlorate, lactose and a pine resin for the white smoke.The chemicals are contained in five units of a cartridge that is placed inside the stove of the Sistine Chapel. When activated, the five blocks ignite one after another for about a minute apiece, creating the steady stream of smoke that accompanies the natural smoke from the burned ballot papers.Despite the great plumes of smoke that poured out of the chimney, neither the Sistine frescoes nor the cardinals inside the chapel suffered any smoke damage, Lombardi said.

John Kerry's Norwegian impresses

US Secretary of State John Kerry showed off more of his hidden language skills on Tuesday, revealing he still knew some Norwegian picked up as a boy when he spent a couple of years in Oslo.

And he won praise from his Norwegian counterpart Espen Barth Eide, who said after talks at the State Department that Kerry "can even speak quite [impressive] Norwegian phrases".

America's new top diplomat had tried out some phrases "and we were quite impressed by his memory", Eide told journalists.

During his first overseas trip after taking over as secretary of state from Hillary Clinton, Kerry delighted his European hosts by speaking French, German and Italian on stops in Paris, Berlin and Rome.

The son of an American diplomat, Kerry spent much of his boyhood in Europe as he accompanied his father to various postings.

He told Eide that he had "wonderful memories of Norway" and the times he had spent in the "parks and the fjords there".

Kerry also praised Norway's role on the global stage.

"On almost every challenge or conflict in the world today, Norway plays one of the giant outsized roles of any country on this planet," Kerry said. "I think it's safe to say that Norway is one of the great global citizens."

George P Bush runs for Texas office

 

George P Bush filed paperwork on Tuesday to run for Texas land commissioner next year, hoping to continue his family's two-president political dynasty in one of the country's most conservative states.

Spokesperson Trey Newton told that Bush filed the official paperwork to run for the office, which is a popular stepping stone to higher posts.

Bush is the nephew of George W Bush and grandson of George HW Bush.

An attorney and Spanish speaker whose mother is originally from Mexico, Bush is considered a rising star among conservative Hispanics.

Hispanics accounted for two-thirds of Texas' population growth over the last decade and now make up 35% of its population. They tend to vote overwhelmingly Democratic. Bush is a Republican.

The Texas land commissioner administers state-owned lands and mineral resources.
 
Bush is the son of former Florida Governor Jeb Bush and his wife, Columba, who was born in Mexico.

George P Bush has been active in politics for years. Last summer, he was promoted to deputy finance chairperson of the Texas Republican Party.

Even though he had yet to officially settle on an office, Bush's campaign raised an impressive $1.3m between early November and 31 December.

Current Land Commissioner Jerry Patterson said he believes running with the Bush name is "both a blessing a curse". He described Bush as smart and qualified but stopped short of offering an official endorsement on Tuesday.

Matt Glazer, executive director of the liberal advocacy group Progress Texas, suggested it may be too early to anoint the next Bush a future political force to be reckoned with.

"Serving in elected office is a privilege, not a birthright," Glazer said in a statement. "George Bush must go through the same public screening as any other candidate."

North Korea confirms end of war armistice

 

North Korea confirmed on Wednesday that it had shredded the 60-year-old armistice ending the Korean War, and warned that the next step was an act of "merciless" military retaliation against its enemies.

A lengthy statement by the North's armed forces ministry added to the tide of dire threats flowing from Pyongyang in recent days that have raised military tensions on the Korean peninsula to their highest level for years.
The statement carried by the official Korean Central News Agency argued that the real "warmongering" was coming from the US and its "puppets" in Seoul.
"They would be well advised to keep in mind that the armistice agreement is no longer valid and [North Korea] is not restrained by the North-South declaration on non-aggression," a ministry spokesperson said.
"What is left to be done now is an action of justice and merciless retaliation of the army and people" of North Korea, the spokesperson said.
The North announced last week that it would nullify the 1953 armistice and peace pacts signed with Seoul in protest over joint South Korea-US military manoeuvres that began on Monday.
Because the Korean War was concluded with an armistice rather than a peace treaty, the two Koreas have always remained technically at war.
Voiding the ceasefire theoretically opens the way to a resumption of hostilities, although observers note this is far from the first time that North Korea has announced the demise of the armistice.
The armistice was approved by the UN General Assembly, and both the UN and South Korea have repudiated the North's unilateral withdrawal.
"The terms of the armistice agreement do not allow either side, unilaterally, to free themselves from it," said UN spokesperson Martin Nesirky.
The North has also threatened to launch nuclear strikes against the US and South Korea in response to fresh UN sanctions adopted after the North carried out its third nuclear test last month.
While the threats have been mostly dismissed as bluster, there are strong concerns that the North will attempt some form of military provocation in the coming weeks.
The South's Yonhap news agency on Wednesday quoted a senior military source as saying sorties by North Korean fighter jets in recent days had reached "unprecedented" levels, with around 700 counted on Monday alone.
As well as nullifying ceasefire agreements, the North severed a Red Cross hotline that was one of the few means of communication between Pyongyang and Seoul, which do not have diplomatic relations.
However, a spokesperson for the presidential Blue House in Seoul said a military hotline was still operating.
"The military communication is working normally and we will seek to convey any message to the North via the channel when necessary," she said.
Wednesday's statement by the armed forces ministry was notable for carrying the first official criticism of South Korea's new president, Park Geun-Hye, since she took office a little more than two weeks ago.
While the spokesperson did not mention Park by name, he said the "frenzy" stirred up the "warmongers" in South Korea was orchestrated by the "swish of the skirt made by the owner of Chongwadae [the Blue House]."
He also slammed Park's recent comments that the North's obsession with nuclear weapons would bring about its own collapse as "utter ignorance" and an echo of the "confrontational" policy of Park's predecessor Lee Myung-Bak.
Park had campaigned on a pledge of greater engagement with North Korea, but February's nuclear test put any rapprochement on indefinite hold.

G20 economies grow despite dip in Europe

Economic growth in G20 countries climbed by 0.5% in the fourth quarter of 2012, slowing only slightly from the 0.6% pace recorded in the previous three-month period despite heavy contractions across Europe, preliminary estimates from the OECD showed on Wednesday.
For the full year 2012, the Organisation for Economic Cooperation and Development said that gross domestic product (GDP) in the G20 group of 20 major global economies expanded by 2.8%, down from 3.8% a year earlier.
The OECD said that as economic trends were still diverging widely within the G20 - with China posting the strongest growth in the quarter and Italy dipping deep into negative territory - the aggregate growth rate "continues to mask" mixed patterns among the world's largest economies.
China's economy grew by 2.0% in the fourth quarter compared with the third quarter, while Italy's contracted by 0.9%.
The OECD said that the economies of all of the G20's European members, including Britain, France, Germany and Italy, contracted in the last quarter of 2012 compared with the previous three-month period.
Japan and the United States remained stable however, while emerging economies such as Brazil, India, Korea, Mexico, and South Africa showed higher growth, it said.

Spain's plan to get youth back to work

Spain pledged €3.5bn over four years on Tuesday to easing mass unemployment among the country's youth, as the government tries to stem a relentless tide of layoffs and lengthening jobless queues.
Prime Minister Mariano Rajoy presented 100 different measures including tax breaks for young freelance workers and for companies that hire workers in their twenties.
Many of the measures, such as lower social security payments for young self-employed workers and up-front payment of unemployment benefits for entrepreneurs, had been announced previously.
On Tuesday they were wrapped into a single strategy.
During five years of economic stagnation and recession, Spain's unemployment rate has risen to 26% - the highest level since the 1970s and one of the highest in the European Union - and more than half of 18-25 year olds are out of work.
More and more young Spaniards are studying German and English and heading abroad to find work.
Public anger is growing over austerity measures to tackle government overspending, which have aggravated economic problems, and over €40bn in public debt spent on rescuing banks that loaned too freely to builders during a real estate boom that ended in 2008.
With more than 5 million people out of work, job losses have accelerated in the first months of 2013.
Spain's 35 blue chip companies have announced more than 35 000 layoffs so far this year, compared with 18 000 layoffs by the same companies last year, according to a report in El Economista newspaper.
Rajoy spoke to an audience of union, company and government representatives at the Moncloa government palace.
But labour union leaders did not wait to hear the details before expressing scepticism over the new strategy.
"If the government does not re-orient its economic policy to make growth and jobs a priority instead of deficit cutting, the effects of the plan will have a limited effect and the economic recession and job destruction will continue," Spain's two biggest union federations, CCOO and UGT said in a statement just before Rajoy made the announcement.
Rajoy has said that any stimulus measures for the economy and jobs will not undermine his determination to cut the budget deficit in line with EU demands.
The government has trimmed the budget by tens of billions of euros this year and last, cutting public sector wages and limiting health and education spending at a time when the economy is shrinking an estimated 1.5% per year.
A third of the funding for the jobs plans will come from a European Special Fund, Rajoy said.     

EU to suspend aviation carbon tax

The European Union is set to partially suspend its controversial airlines emissions tax scheme, officials said Tuesday, as part of a bid to push international critics into reaching a global aviation deal.
Since last year, all airlines landing and taking off from EU airports have been liable for their carbon dioxide emissions, a move that infuriated countries such as the United States, China, Russia and India.
But after the bloc's parliament and governments struck a deal on Tuesday, the EU is now set to "stop the clock" for airlines flying intercontinental routes until the International Civil Aviation Organisation (ICAO) holds its general assembly in September.
The suspension should go into effect before April 30, EU parliamentarian Peter Liese said. Internal flights within the EU will continue to be liable for their emissions.
In the past, the EU had justified its decision to proceed unilaterally on aviation emissions by pointing to 15 unsuccessful years of pushing for a global agreement.
"It is now up to ICAO to deliver," said Irish Environment Minister Phil Hogan, whose country holds the EU's rotating presidency. "I hope this ... derogation will serve as an incentive in the negotiations."
"Nobody should put our determination in question to address the problem of aviation emissions," Liese added.
The European Parliament and EU governments still have to endorse the deal reached on Tuesday, but the move usually is a formality.

Putin, Seagal team up for sports

President Vladimir Putin on Wednesday teamed up with American action movie actor Steven Seagal to promote the Soviet-style regime of rigorous physical training for Russian schoolchildren.

Accompanied by the black-clad star of "Under Siege" and "Above the Law", Putin, himself an avid sportsman, toured a newly-built complex at a prominent sambo martial arts training centre in Moscow.
After attending several training sessions, the Russian strongman said too many Russian children were sickly, noting they should take up sports to be able to defend themselves - and the country.
"We should not have any children who, as they say, sit on the bench during physical education classes. Everyone should practise sports, everyone without exception," Putin said at the Sambo-70 sports complex.
Sambo, a mixture of judo and wrestling, was the official in-house martial art of the KGB security services, which Putin practised before switching to judo.
Saying that two-thirds of Russian teenagers suffered from chronic illnesses by the age of 14, Putin called on the government to reintroduce the Soviet-era national fitness programme that used to be known by its abbreviation GTO, or Ready for Labour and Defence.
"Children should become strong, they should be healthy, love sports and have an opportunity to practise them, should know how to defend themselves, their loved ones, their family," Putin said in remarks released by the Kremlin.
"Ultimately, they should be able to defend their motherland."
Putin's spokesperson Dmitry Peskov told Russian reporters that the Russian president and Seagal have been friends "for a long time" and regularly meet.
Earlier in the day, the two men had breakfast at Putin's residence outside Moscow, Peskov was quoted as saying.
In 2010, Putin, then the country's prime minister, visited a championship match of ultimate fighting in the company of Hollywood star Jean-Claude Van Damme.

NEWS,17.12.2012

Putin touts record Russian arms sales

Russian arms exports reached a record $14 billion this year, President Vladimir Putin said today, extending a run of record-breaking sales in recent years. The world's second biggest exporter has cultivated new weapons clients in Southeast Asia and Africa, despite criticism that it is failing to deliver the technological benefits of Western suppliers or the low costs of emerging weapons exporter China. "Let's talk about our results they are positive. We are reaching a record level of weapons exports. Their total volume was above $14 billion," Putin said in a televised meeting with officials. He said Russia had signed over $15 billion in new export contracts this year alone. He did not spell out when deliveries on those deals were expected.Russia has faced Western criticism over its weapons sales to the Syrian government, worth nearly $1 billion in 2011.Moscow says its arms deliveries to Syria, a long-time ally, do not violate international law and are not intended to help President Bashar al-Assad's government fight a 21-month-old uprising, but rather to fulfil Soviet-era commitments. Russia has made clear it would use its UN Security Council Vote to veto an arms embargo against Damascus, contending such a move would be one-sided when rebels are able to obtain weapons via smuggling into territory they now control. Moscow has reported no major arms deals with Syria this year. A major order of fighter jets was not completed, although it remains unclear as to why. Putin gave no specifics on Russia's main weapons buyers.Top weapons clients also include Soviet-era client and regional Asian heavyweight India, as well as Vietnam and other Southeast Asian nations wary of China's growing military might.Putin said a major part of Russia's weapons business includes upgrades and refurbishment of Soviet-era technology and hardware. "We understand that competition in this sector of the international economy is very high and very serious," he said. Exports from the world's top producer, the United States, have hovered around $30 billion annually in recent years.State arms exporter Rosoboron export accounts for around 80% of all Russian arms sales in a given year and nearly 20 independent firms comprise the rest with sales of spare parts and upgrades.

EU holds back on eurozone overhaul

European leaders doused hopes of a radical eurozone overhaul on Friday, after brokering deals to control banks and refloat Greece seen as adequate to stem the immediate crisis.The last EU summit of a year that saw Greece close to bankruptcy and bigger Latin countries pressured to overhaul their economies in line with German demands saw a series of ambitious proposals effectively kicked into the long grass.Despite worries over political uncertainty in Italy, flagship plans to fix fundamental flaws criticised since the introduction of the single currency were put to one side until late 2014 at the earliest.Europe's effective paymaster, German Chancellor Angela Merkel, hinted that "financial aid" could in the future be given to countries committing to reforms as part of moves towards greater economic co-ordination in the bloc.In the eurozone alone, joblessness is heading towards the 20 million mark after a year of devastation and with recession set to last throughout much of 2013.However, the sense of imminent panic on financial markets that dominated much of 2012 decision-making has receded significantly since the European Central Bank (ECB) issued a long-resisted but near-unlimited guarantee in the summer to stand behind countries in financial difficulty." No doors were closed," said Jose Manuel Barroso, the head of the executive European Commission. Yet ideas heavily promoted by EU President Herman Van Rompuy over the last six months, including a central eurozone budget, seemed to fizzle out.Van Rompuy said he would present another report to leaders in June 2013, as well as proposing that national governments sign up to contracts with the EU on reforms."All the hard work is beginning to pay off. A lot has been achieved over the course of a year," he insisted. "This work is not over: the dynamic will carry on in the coming year," pledged Van Rompuy. French President Francois Hollande said that late-2014, when a new Commission is installed, "would be the time we could envisage a new phase with a modification of the treaties. "The resumption of loans to Greece followed a successful plan to wipe tens of billions of euros from the country's debt pile.A first payment of €34.3bn would be flowing to Athens "as early as next week," said outgoing Eurogroup chair and Luxembourg Prime Minister Jean-Claude Juncker.The accord prompted Greek Prime Minister Antonis Samaras to declare that "Grexit", the idea that Greece would be forced out of the 17-nation bloc, was "dead." "Greece is back on its feet," declared an ecstatic Samaras, who has pushed through painful economic reforms demanded by international creditors, sometimes in the face of violent street protests. Meanwhile, the deal for the eurozone's largest banks to come under the aegis of the ECB from March 2014 was hailed by its head Mario Draghi as "an important step towards a stable economic and monetary union, and towards further European integration".Despite a noticeably more bullish tone at the summit, fears over Italy lurked in the background, after Prime Minister Mario Monti, credited with important reforms there, said he was stepping down soon. Former leader Silvio Berlusconi had hinted that he might stand for a fourth time but appeared to row back, telling Belgian television that he had "so much to do" outside politics. Hollande downplayed the chance Berlusconi would run in a future election, saying: "I don't think there is a very serious likelihood" of this."Merkel underlined a closing of ranks at the summit. "I made clear that the government of Mario Monti has done a great deal of helpful work for the confidence that Italy is now enjoying again," she said. Leaders were to reconvene later Friday at 10:00am (09:00 GMT) to discuss moves towards a common security and defence policy as well as to take a position on the Syria crisis.

Greece's lenders warn of 'very large' risks to bailout

Political resistance and potential court challenges are among "very large" risks to reforms required for Greece's bailout programme, the country's European lenders said today. The long-awaited report from the European Commission and the European Central Bank details the findings of the "troika" of the EC, ECB and the International Monetary Fund on Athens' efforts to meet targets under its latest rescue package.The report formally confirmed that Greece deserved further aid under the 130 billion euro ($202-billion) bailout, and a Greek finance ministry source said Athens had received a long-delayed instalment of over 34 billion euros in aid today. But the lenders warned Athens still risked falling short on its commitments. "The key risks concern the overall policy implementation, given that the coalition supporting the government appears fragile and some components of the programme face political resistance, despite the determination of the government," the report said." Important budgetary measures are likely to be challenged in courts, which could lead to the need to fill a fiscal gap emerging as a consequence." Greece, which has been bailed out twice by the EU and IMF since the debt crisis erupted, has a long history of missed targets and failure to meet promises to overhaul its bloated state sector and liberalise its recession-hit economy. A separate report by an EU task force today said by the end of October Greece had completed only 88 of the targeted 300 audits of large tax payers and 467 of 1300 audits of high-wealth individuals. Despite the lingering doubts on Greece's commitment and ability to reform, the country's lenders last week agreed to disburse aid to Athens after it bought back its own debt at a fraction of face value, cutting its debt burden. The decision to unlock aid - expected to total over 52 billion euros by the end of March removed the spectre of a Greek bankruptcy and euro zone exit. Even so, Moody's ratings agency said only further debt relief from official creditors, such as governments, would put its debt back on sustainable footing. The agency classified the bond buyback scheme as a "distressed exchange" and, as a result, a default on the Greek government debt held by private bondholders. Prime Minister Antonis Samaras's conservative-led government has promised to restore the country's credibility but his coalition has faced attacks both from within and outside on its plan to push through a new round of austerity. The troika's report warned those spending cuts next year could hurt the weak economy more than expected, though that could be stemmed by the government paying bills that have been in arrears. Greece's economy will contract by about 6% this year its fifth in recession and by a further 4.2% next year before growing 0.6% in 2014, the report said. But growth would not return without a business reform drive. Criticising influential business lobbies, it said reviving the economy would require "breaking the resistance (to reform) of vested interests and the prevailing rent-seeking mentality of powerful pressure groups".The report acknowledged that privatisation proceeds had been disappointing so far but that the programme had gained some momentum since September. It forecast revenue of 8.5 billion euros by 2016 from the asset sales, roughly a billion lower than Athens' own estimates in a mid-term fiscal plan. "Doubts on the effectiveness of the governance of the privatisation process however continue to persist," it said.

Wall Street gains as Obama and Boehner meet

Wall Street gained as a meeting between US President Barack Obama and House Speaker John Boehner at the White House today bolstered optimism a budget agreement will be reached soon Wall Street took heart from the 45 minute gathering about which no further details were released. In afternoon trading in New York, the Dow Jones Industrial Average rose 0.62 %, the Standard & Poor's 500 Index gained 1.03%, while the Nasdaq Composite Index advanced 1.01%. The stakes are high for the budget talks aimed at avoiding US$600 billion of tax increases and spending cuts from taking effect on January 1; failure to reach an agreement might push the US into recession in the first half of next year.Indeed, a report today showed that manufacturing in the New York region contracted more than expected in December, underpinning the fragility of the economy that prompted the US Federal Reserve to expand its stimulus program last week."It's a historic tug of war: pulling on one side is the fiscal cliff, pulling the other side is continued global monetary easing," David Sowerby, a portfolio manager at Boston based Loomis Sayles & Co, told Bloomberg News. "The most positive thing for the market is valuation and an accommodative Fed policy. "In Europe, the Stoxx 600 Index finished the session with a 0.1% decline from the previous close. European Central Bank President Mario Draghi reminded investors of the challenges ahead, even as he predicted a recovery in the second half of 2013 in comments at the European Parliament's Economic and Monetary Affairs Committee. "We expect economic weakness to extend into next year with a very gradual recovery in the second half of the year," Draghi said. Still, "the medium-term outlook for economic activity remains challenging."The central bank's new supervisory powers over banks in the region will help restore confidence, Draghi said. Equity investors in Japan applauded the Liberal Democratic Party's victory as leader Abe Shinzo plans aggressive fiscal and monetary stimulus measures to revive the nation's economy that just tipped into recession. The Nikkei 225 closed with a 0.9% gain.It's considered bad news for the yen, however, which was last 0.4% weaker against the US dollar. Earlier in the session, the yen dropped as low as 84.48 per dollar, the weakest since April 12, 2011, according to Bloomberg. The Bank of Japan is scheduled to start a two-day policy meeting on Wednesday. Switzerland's UBS will pay around US$1.5 billion to settle charges that a group of traders at its Japanese unit rigged Libor interest rates, Reuters reported, citing a source familiar with the matter. UBS will admit that about 36 of its traders around the globe manipulated yen Libor between 2005 and 2010, according to the source, with a final deal not expected before Wednesday. Shares of Apple fell initially after Citigroup cut its rating for the stock amid concern about tapering demand for its iPhone 5. The stock rebounded, last up 1.2%.

NEWS,17.10.2012

Putin says Russia will not be dictated to on arms sales

President Vladimir Putin said today that only the UN Security Council could restrict Russian weapons sales abroad, a remark that appeared aimed at defending the Kremlin against criticism of its arms supplies to the Syrian government."Only sanctions imposed by the UN Security Council can serve as a basis for limiting weapons supplies," Putin said, according to state-run Itar-Tass news agency."In all other cases, nobody can use any pretext to dictate to Russia on how it should trade and with whom," he was quoted as telling a meeting of a state commission on the arms trade.The West has criticised Russia for vetoing, along with China, three UN Security Council resolutions aimed at putting pressure on Syrian President Bashar al-Assad to end a conflict that has killed an estimated 30,000 people in 19 months.Russia sold Syria $1 billion worth of weapons last year and has made clear it would oppose an arms embargo in the Security Council because of what it says are concerns rebels fighting Assad's government would get weapons illegally anyway.Putin said in June that Russia was not delivering any weapons to Syria that could be used in a civil conflict.Turkey said on October 11 that a Syrian passenger plane grounded en route from Moscow to Damascus was carrying weapons. Moscow said the cargo included radar parts that were of dual civilian and military use but were fully legal.Moscow in 2010 scrapped plans to deliver high-precision air defence missile systems to Iran, citing sanctions imposed by the UN Security Council over Tehran's nuclear programme, a move welcomed by the United States and its European allies.Russia denies trying to prop up Assad, who allows Russia to maintain a naval supply facility in the port of Tartus that is its only military base outside the former Soviet Union.But Moscow says Syria's crisis must be resolved without foreign interference, particularly military intervention.

Greece declares progress as inspectors depart

Inspectors from Greece's international lenders will leave Athens after making substantial progress on talks to unlock aid for the near-bankrupt country but without agreement on crucial labour reforms, officials said today.After months of often heated and testy negotiations, Athens and its European Union and International Monetary Fund lenders appeared to be in the home stretch toward a comprehensive deal on spending cuts and reforms needed to avoid a Greek bankruptcy."I'm confident we're doing everything we have to do in order to get it (a deal) and get it soon, so that we can move towards a recovery," Prime Minister Antonis Samaras said at a meeting of European centre-right parties in Bucharest.A senior Greek government official earlier said the two sides had reached agreement on all issues except labour reforms.In a rare statement to reporters during talks late on Tuesday, the IMF's mission chief for Greece, Poul Thomsen, also declared that the two sides had agreed on "most policy issues", with agreement on the rest expected soon.Thomsen and his European Commission and European Central Bank counterparts are due to depart Athens today in order to brief leaders at a two-day European Union summit, where Greece's future will loom large despite not being the focus of talks.Once a deal on the austerity package and reforms is clinched, the so-called troika of EU, ECB and IMF lenders are due to present a report on Greece's progress in meeting the terms of its bailout and whether it can cut its debt down to sustainable levels.That report is expected to show that Greece is hugely off track on its commitments, which critics blame on a lack of political will, political paralysis during repeat elections this year and a deeper than expected recession.But with Greece due to run out of money next month and Europe determined to avoid fresh market turmoil that drags down bigger economies like Spain and Italy, Athens is expected to ultimately secure its next 31.5 billion euro aid tranche.Still, Athens needs the blessing of the troika on a 11.5 billion euro austerity package as well as a long list of reforms first to be able to unlock that aid.Talks on both fronts have moved slowly since July, with signs of progress tempered by tension and mistrust over the ability of Greece's political brass to push through public sector reform and generate savings."Hard red line" On Tuesday, the two sides resolved differences on the extent of Greece's recession next year and issues related to health spending cuts after hitting an impasse on labour reforms during an earlier round of talks, officials said.They agreed Greece's economy would contract 4.2% next year - a key estimate in calculations to determine whether Greek debt will be viable - after Athens initially predicted a 3.8% tumble and lenders forecast a 5% contraction.Officials also suggested that most of the issues related to the long-discussed spending cuts package had been resolved apart from disagreement over the use of brand name or generic drugs in the state healthcare system."There has been substantial progress on all fronts and only some issues remain open, mainly labour and structural," a second Greek government official said."We are confident these will also be resolved in time."

Wall Street rises on US housing data

Global stocks rose and the euro hit a one-month high today, helped by brighter prospects for resolving Spain's debt woes, while better-than-expected housing data and gains among financials lifted the US equity market.US and German government debt prices fell after Spain avoided a damaging ratings downgrade from Moody's and stronger-than-expected US housing data pointed to an improving economy, which reduced safe-haven demand.Growing speculation that Spain will ask for a bailout next month lifted the euro. A possible line of credit to Spain and some easing of German opposition to aid for Greece and Spain were also likely to support the euro in the near term.Wall Street was mostly higher, putting the S&P 500 on track for a third day of gains, but disappointing results from Intel Corp and IBM weighed on the Dow.Intel slumped 3.0% to $21.68 while IBM lost 5.2% to $200.08. Both were among the biggest drags on the Dow and Nasdaq 100.M&T Bank jumped 5.2% to $102.48 after posting third-quarter results, helping to lift the KBW Bank index 1.5%, while the S&P financial services index rose 1.1%, the biggest gainer among the 10 S&P 500 sectors."It seems like it's a classic earnings period reaction. Either people are too exuberant and expectations are raised too high to beat when the actual number comes out or people are too pessimistic and the earnings are just not as low," said Rick Meckler, president of hedge fund Liberty View Capital Management in Jersey City, New Jersey.The Dow Jones industrial average was down 7.52 points, or 0.06%, at 13,544.26. The Standard & Poor's 500 Index was up 6.30 points, or 0.43%, at 1,461.22. The Nasdaq Composite Index was up 10.01 points, or 0.32%, at 3,111.19.European shares rose for a third consecutive session after Spain clung to its top grade credit rating, bolstering expectations the euro debt crisis can be contained."Spain is in a better place for now," said Richard Robinson, a fund manager at Ashburton who recently bought shares of Spanish bank Bankinter and Italian bank Intesa on prospects of improved euro zone economic problems.The FTSE Eurofirst 300 index of top European shares gained 0.5% to close at 1,118.62. MSCI's all-country world equity index rose 0.8% to 338.24, extending Tuesday's 1.2% gain.The euro was up 0.55% at $1.3124, its highest since mid-September.Bond losses accelerated after data showed that groundbreaking on new US homes surged in September to its fastest pace in more than four years, another sign that the housing sector's budding recovery is gaining traction."The housing starts and permits are both up a ton. The market was already selling off, it started overnight with Moody's affirming Spain's investment grade rating," said James Newman, head of Treasuries and Agency trading at Keefe, Bruyette and Woods in New York.Benchmark 10-year notes fell 19/32 in price to yield 1.79%.Brent crude futures fell further and US crude turned lower in choppy trading after a report from the Energy Information Administration showed US crude oil stocks rose more than consensus expectations last week.December Brent fell 92 cents to $113.08 a barrel. US oil for November fell 21 cents to $92.88.