Baseball91's Weblog

March 20, 2009

The Cost of Freedom

The news from Europe, which is affecting government and basic human rights.

By Jeff White of the Christian Science Monitor
Published: March 20, 2009
Last November, Dmitrijs Smirnovs, a young economics professor in this coastal university town, published an essay in a leading Latvian newspaper warning that the country was heading for a financial collapse to rival Iceland’s collapse. Soon after, the secret police showed up at his home. They held Mr. Smirnovs for two days. The charge: spreading unrest and destabilizing Latvia’s financial and banking system.

Associated Press
Riga Latvia Published: March 19, 2009
RIGA, March 18 (Reuters) – The European Bank for Reconstruction and Development (EBRD) is set to invest about 100 million euros ($130.3 million) for a minority stake in Parex Bank, which Latvia had to nationalise, officials said on Wednesday.
Rescuing Parex, the country’s second-largest bank, after a run on deposits was one of the reasons Latvia had to take a 7.5 billion euro bail-out last year, led by the International Monetary Fund (IMF). The government is keen to get the bank back on its feet.

RIGA, March 18 (Reuters) About 300 Latvians marched through the capital on Monday to commemorate countrymen who fought in a Waffen SS unit during World War II, defying a ban by city officials.

Dozens of protesters — mainly ethnic Russians — jeered at the participants as they carried flowers to the base of the Freedom Monument in downtown Riga. Fearing clashes, police had set up barricades to keep the two sides apart at the annual event.
No violence was reported, though police spokeswoman Ieva Reksna authorities said four people were detained for unruly behavior.

Unlike previous years, Riga city officials had prohibited World War II veterans and patriotic organizations from holding demonstrations, fearing they would increase tensions in the crisis-hit Baltic nation. Two months ago, anti-government protesters clashed with police outside Parliament in Latvia’s worst riots since it regained independence from the Soviet Union in 1991

By Stephen Castle
Published: March 19, 2009 in IHT

“It is not time to look at more growth measures,” the German chancellor, Angela Merkel, told the Bundestag in Berlin, Reuters reported. “I disagree with this idea completely. The existing measures must work, they must be allowed to develop.”
Her stance underlined the difficulty of persuading European nations to cooperate over spending from the E.U.’s collective budget. Gathering Thursday, the leaders sought to break their deadlock over the €5 billion program, meant to boost energy connections, environmental projects and broadband Internet connections.
Poland was fighting hard to ensure support for the Nabucco pipeline, which, sponsored by the E.U., is designed to reduce reliance on Russian gas by connecting the union to the Caspian region. That was being resisted by Berlin.
More broadly the E.U. hoped to overcome divisions ahead of the G20 summit in London. Britain is sympathetic to U.S. calls for more stimulus but, in a paper circulated.

By Judy Dempsey
Published: March 19, 2009 in IHT
To date, a tangle of Brussels bureaucracy has slowed the release of the funds. But with banks restricting credit across most of Eastern Europe, the European Commission is now, for the first time, allowing advance payments for infrastructure and other projects.

Poland, where the €200 million Mlociny project was funded 50-50 by Warsaw city council and the EU, has many other big projects — from upgrading railway lines to new water treatment plants — that will mean jobs, and also more investment.
There is now incentive to do exactly the opposite — speed them up, noted Sandor Richter, an expert on the region at the Vienna Institute for International Economic Studies.

In a March 11, 2009 interview, the president of Poland challenged the view that Eastern Europe as a whole is heading into a deep recession. Poland again is being buffeted. Industrial output fell at an annual rate of 9 percent in the final quarter of 2008, and the Polish zloty currency has plummeted against the euro in recent months.
This time the company, the biggest manufacturer of plastic films and laminates in Poland, is coping better, according to Tadeusz Nowicki, its chief executive.
In large part, that is because of the fortuitous acquisition of a plant in Germany – inside the euro area – soon after Poland joined the European Union in 2004. That means the company, which employs 800 people over all, earns a fair portion of its revenue in euros, a relatively strong and stable currency.

In Poland, the zloty has fallen in value by 50 percent against the euro. Poland, with almost 40 million people, is the biggest of the new member states. Hungary and Latvia were particularly vulnerable, Hungary because of its high exposure to foreign lending, and Latvia because of its shaky banking system and overextended consumers. When foreign currency financing dried up, the domestic interbank money markets stumbled and currencies came under pressure. Both countries were rescued by the International Monetary Fund and the European Union, with a heavy price attached in the form of government spending cuts.


1 Comment »

  1. Comment by baseball91 — October 18, 2015 @ 4:35 PM | Reply

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