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The Weekend Neos Kosmos : 21 February 2015
DIGITAL.NEOSKOSMOS.COM THE WEEKEND NEOS KOSMOS | SATURDAY 21 FEBRUARY 2015 25 GREECE Bank officials fear a ‘liquidity accident’ YIANNIS PAPADOYIANNIS Greek bankers stressed this week the need for an agreement to be reached between the government and Greece’s eurozone peers that will confirm the country’s European prospects, as the outpour of deposits continued unabated. Thursday was another tough day for bank liquidity, as depositors continued to withdraw their savings for fear of a rift in talks between Athens and the eurozone. Banks estimate that since the start of the week accounts have seen their balance shrink by another 2 billion euros and acknowledge that unless this trend is contained and reversed they risk finding themselves in big trouble without the dynamic intervention of the European Central Bank (ECB). The ECB, however, has appeared reluctant to offer additional support without an agreement between the eurozone and the Greek government. On Wednesday the ECB’s governing council approved a small increase of emergency liquidity assistance (ELA) to Greece (by 3.3 billion euros), which can only marginally cover the needs of local lenders for the next few days. It was a move that was seen as an ultimatum of sorts for an agreement to be reached today in Brussels. In the same context, the ECB’s Single Supervisory Mechanism (SSM) is planning to put pressure on domestic banks to reduce their exposure to Greek sovereign debt if today’s negotiations do not come to a positive conclusion. There was major concern generated on Thursday in Athens from a report in German newspaper Frankfurter Allgemeine Zeitung according to which ECB board members reacted in Wednesday’s meeting to the raising of the ELA ceiling, calling for the imposition of restrictions in capital flows. ECB sources later refuted the report, but local bank officials conceded that as long as uncertainty continues, the chances of some sort of restrictions being imposed are growing. If there is an agreement at Friday’s Eurogroup the clouds of doubt will be dispelled. If not, the upcoming three-day weekend may likely test the Greek credit system to its limits, they say. In a meeting on Thursday between Bank of Greece governor Yannis Stournaras and Deputy Prime Minister Yiannis Dragasakis, the former said that the outflow from the credit system is under control, adding that “we are here to avoid an accident”. Bank officials, however, make no secret of their concern about the course of negotiations and the uncontrolled rumours that undermine confidence, noting that a liquidity accident could come about at any moment without any major or dramatic event triggering it. On the possibility of capital controls, they note that this is an exceptionally complex issue that would have a very serious psychological impact on citizens and the market, as well as on the day-to-day operation of businesses. Prokopis Pavlopoulos becomes the new president of the Greek Republic Prokopis Pavlopoulos, who was elected Greece’s new president on Wednesday, is a veteran conservative insider whose selection has raised its share of eyebrows among the ruling left. The 64-year old, famed for his snowy mop of hair, has worked closely with previous presidents as well as serving as interior minister and parliamentary spokesman for the conservative New Democracy party. A staunch pro-European, Pavlopoulos was elected to a five-year term by 233 votes out of the chamber’s 300. His candidacy puzzled some within the ruling radical left SYRIZA party however, as Pavlopoulos’ legacy is inconsistent with the new hard-left government’s pledges to revolutionise political life in the country. Greek media reported that Pavlopoulos received ‘mild’ applause from SYRIZA lawmakers when his candidacy was announced on Tuesday. But Prime Minister Alexis Tsipras said the new president had “a proven democratic sensitivity, a high feeling of national conscience, and ... enjoys broad approval in society and parliament”. According to French Press Agency (AFP) reports, Pavlopoulos was considered a safe choice, being largely untainted by the controversy surrounding the country’s Greece ready to offer help for the ‘humanitarian crisis’ in Ukraine Greek Foreign Minister Nikos Kotzias (R) with his Ukrainian counterpart Pavlo Klimkin. Greek FM backs Ukraine sovereignty On a visit to Kiev, Greek Foreign Minister Nikos Kotzias on Thursday expressed Greece’s support for Ukraine’s sovereignty and for the enforcement of the ceasefire between Ukraine and pro-Rus- The new president of Greece, Prokopis Pavlopoulos. loathed bailout obligations, agreed to by the former conservative government. Pavlopoulos distanced himself from measures many Greeks said were strangling the economy and punishing the poor. His career has not been entirely devoid of controversy, however. Pavlopoulos was accused by critics of filling thousands of public sector jobs with friends and supporters of New Democracy during his stint as interior and public administration minister from 2004 to 2009. His reputation was hit again by the 2008 riots that broke out on his watch after the death of a 15-year-old Greek student, Alexandros Grigoro- poulos, who was shot dead by police in Athens. The riots dogged Pavlopoulos but are understood to have endeared him to leftists, who appreciated his refusal to order a police crackdown on the violence. More recently, the mildmannered Pavlopoulos was criticised for not lifting a finger to help a female Communist lawmaker, who was struck in the face by a neoNazi politician during a morning talk show in 2012. But supporters applaud Pavlopoulos’ diplomatic finesse and legal expertise. A few months ago, New Democracy entrusted Pavlopoulos with a constitutional revision to enable the people to elect presidents, thereby stopping the process from effectively serving as a government confidence vote. It was parliament’s inability to agree on a candidate at the presidential election in December which sparked early elections and ushered in the radical left SYRIZA party in January. A moderate, Pavlopoulos boasts ties with Greece’s top statesmen. In 1974, he served as secretary to former president Michail Stasinopoulos. He was also legal adviser to another former president, New Democracy founder Constantinos Karamanlis, between 1990-1995. A lawyer who studied in Paris on a scholarship from the French government, he began working as a lecturer but rose fast to the rank of professor before moving into the political sphere. He has challenged the legal arguments behind Germany’s insistence that Greece has no grounds to request war reparations for Nazi-era atrocities. “There is a legal basis for Greece’s claims ... the issue is not settled,” he wrote last year, labelling comments by German Finance Minister Wolfgang Schaeuble as “provocatively mistaken”. Born in Kalamata in southern Greece in 1950, Pavlopoulos is married with three children. ATHENS’ DAILIES AT A GLANCE EFIMERIDA TON SYNTAKTON: Feeling of euphoria for debtors to Tax Bureau. ELEFTHEROS TYPOS: New debt settlement foresees up to 50 per cent haircut. ESTIA: The crucial role of the new President of Republic. IMERISIA: sian rebels agreed last week. As Kathimerini reports, after talks with his Ukrainian counterpart Pavlo Klimkin, Kotzias stressed that diplomacy was the only way to solve political disputes. “In international politics, sanctions are not a tool for expressing anger or senti- ment,” he said, referring to restrictions being imposed on Russia by the European Union. Kotzias also expressed Greece’s readiness to help Ukraine deal with its “humanitarian crisis”, chiefly by offering medical treatment to wounded citizens. ETHNOS 50 pct cancellation of debts to Tax Bureau. AVGHI: Generous debt haircut and protection of primary residence. TA NEA Stathakis’ (George, Economy Minister) plan for bad loans DIMOKRATIA: All citizens included in the 100-instalment settlement. Bold settlement. KATHIMERINI: Warnings from ECB and USA. LOGOS: Up to 50 per cent haircut to overdue debts.
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