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Putin And Tsipras Are Meeting: Here Are The Main Highlights
While Germany has pre-emptively, and somewhat defensively, come out proclaiming Russian aid to Greece as 'no big deal' - a "routine event" -
As Bloomberg reports, the German government suggests Russia-Greece loan would be a "routine Event."
One country borrowing from another “is nothing special at all,” German Finance Ministry spokeswoman Friederike von Tiesenhausen says when asked whether Greece accepting loans from Russia would be in line with European policy. “That’s the international financial system.”
Declines to comment specifically on possibility of Russian loans to Greece, says that’s “hypothetical” and “as far as I know not on the agenda” of Tsipras visit to Moscow
We suspect the signal that it would send would not be entirely great for the EU (and Obama's) 'Russia is evil' meme.
Nonetheless, as Greek Prime Minister Alexis Tsipras meets Russian President Vladimir Putin today, topics for discussion vary from lifting sanctions (bilaterally) or bankrolling a bailout to gas discount from Gazprom. Here's a summary... (via RT),
The new 40-year-old leader of one of the world’s most indebted countries with meet with Putin on Wednesday, just one day before the country is due to repay €463.1 million to the International Monetary Fund. The Greek Prime Minister arrives in Moscow on Tuesday.
Is Russia going to bail out Greece?
Rumors have been abuzz that Athens and Moscow are plotting a secret bailout ever since the idea was first floated by Russian Finance Minister Anton Siluanov days after the Syriza party won the elections in January. Russian daily Kommersant reported that Moscow is ready to offer indirect financial help, citing an unnamed government source.
“We are ready to consider the issue of allowing Greece a gas discount: under the contract, the gas price is linked to the oil price that has gone significantly lower in recent months,”Kommersant cited a Russian government source as saying.
“We are also ready to discuss the possibility of allowing Greece new loans. But in turn we are interested here in reciprocal moves, in particular in terms of Russia getting certain assets from Greece,” the source added, without specifying the sort of assets he was talking about.
Greek Finance Minister Yanis Varoufakis has said that his country “will never ask for financial assistance from Moscow,” in an interview with Zeit online in early February.
Wait, does Russia have the money for this?
Yes and No.
Government officials have hinted that Russia’s help, if provided, would be indirect.
Most economists around the world are more positive about the Russian economy, but everybody agrees it will contract this year between 4 and 3 percent. Most recently S&P improved its economic outlook for Russia, saying it’ll return to growth in 2016 and add 1.9 percent.
In the first quarter of 2015, the economy expanded 0.4 percent, and the Russian ruble, which lost nearly 50 percent in 2014, is now the best performing currency of the year.
Though Russia‘s economy isn’t as strong as it was two years ago, and growth is near zero, it still has $356 billion saved up in currency reserves as of April 1 and over $150 billion split between the country’s oil reserve funds, the National Reserve Fund and National Welfare Fund. If the Russian economy goes nose first into a recession, these funds are expected to keep the financial situation stable for 2-3 years.
Russia provides financial aid and loans to most former Soviet countries. In March, the Kremlin prolonged a $2 billion loan to Belarus, and in February agreed on a $270 million loan to Armenia. In 2013, just before Ukraine began its pivot towards Europe, Russia gave Kiev a $3 billion Eurobond loan.
The question isn’t if Moscow has the money but if it wants to get a ‘political dividend’ by getting another ally and sink money into Greece, which has already sucked up €240 billion in EU debt and hasn’t posted GDP growth in six years.
What about a gas discount for Greece?
Gas has become an important issue in economic relations between Russia and Greece, after President Putin announced the new Turkish Stream pipeline that will travel to the Turkish-Greek border. Both Russia and Greece are interested in the project but Athens’ stance largely depends on the gas price Russia will offer.
On March 30, Greek Energy Minister Panagiotis Lafazanis met with Russian counterpart Aleksandr Novak as well as Gazprom head Aleksey Miller in Moscow to discuss a gas discount for Greece as well as the ‘take-or-pay’ clause, which requires Athens to buy gas it doesn’t use.
Under the current contract, Greece’s state gas company DEPA buys gas at $300 per 1,000 cubic meters. In 2014, DEPA was able to secure a 15 percent discount from Gazprom. Greece may be able to secure a further discount or renegotiate the ‘take-or-pay’ part of the contract if Athens offers Russian companies oil assets or rights to explore oil and gas deposits in the Ionian Sea.
In 2013, Gazprom made a €900 million bid to buy a controlling stake in DEPA, but backed out of negotiations at the last minute, citing concerns over the company’s financial stability. Gazprom currently controls almost 70 percent of the Greek gas market.
During the talks, Lafazanis also discussed the prospect of Greece joining the Turkish Stream pipeline project, which will have the potential to deliver 47 billion cubic meters of gas to Europe via Turkey. Gazprom said the onshore route will pass through the Black Sea and reach the Turkish port of Kiyikoy, and then travel to the Turkish-Greek border near the town of Ipsila.
Can Moscow lift sanctions on Greece?
Russia’s agriculture counter-sanctions against the EU do not expire until August 2015, a year after they were enacted as a counter measure to protect Russia’s economy.
Greece has been hit especially hard by Moscow’s food ban, as more than 40 percent of Greek exports to Russia are agricultural products. In 2013, more than €178 million in fruits and conserves were exported to Russia, according to Greece’ fruit exports association, Incofruit-Hellas.
Russian Minister of Agriculture Nikolai Fyodorov has said food sanctions against Greece would be lifted in the event that Athens leaves the EU. While Greece is a part of the EU, it cannot sign any trade agreements with Russia.
As an EU member, Greece has the power to veto further sanctions against Russia. Alexis Tsipras has openly said that sanctions against Russia are a “road to nowhere”. Other Moscow-friendly states include countries with very close economic ties to Russia- such as Hungary, Slovakia, Italy, and the Czech Republic.
Russia is Greece’s biggest trading partner, with net trade in 2013 nearly $12.5 billion (€9.3 billion), more than Greece and Germany in the same year. Russia is the biggest source of imports for Greece, accounting for 11 percent in 2013.
Once Russia’s food market is again open, Greece, along with Turkey and Cyprus, will be the first to re-enter, according to Sergey Dankvert, head of Russia’s food inspector, Rosselkhoznadzor,
After the trip, what’s next for Greece?
While Tsipras is still in Moscow, Greece is expected to make a €463.1 million payment on IMF loans. By the end of May, another €768 million is due.
If Varoufakis goes back on his statement and Greece does default on its loans from EU creditors, leave the eurozone and shared currency, and then ask Moscow for a few billion to get by - the situation would shock almost everyone and spark chaos across financial markets since Greece has repeatedly said it intends to pay off its massive €324 billion debt.
The reason the EU came to Athens’ rescue with two bailouts totaling €240 billion was to protect the euro currency, which is shared by 18 countries including Greece.
So far, Athens has signaled it wants to keep borrowing from the EU, but just under different terms. If for some reason Greece decides to default on its IMF debt, it would be the first developed country to ever do so.
The Greek economy hasn’t expanded since 2008 and has rapidly come to a grinding halt under stringent EU conditions.
Greece was given a four month extension on its bailout plan from its lenders, and the next step will be decided after Athens can convince EU ministers they are serious about economic reform. However, ministers from Greece have said they do not intend to default on any financial obligations to their lenders.
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Which one is the whore and which one is the pimp?
The thing about addiction.....is you have to want to quit.
Will there be lambs involved?
Greece will never leave the Euro unless thrown out because the government bureaucrats and political criminals receive pensions in Euros. They do not want Drachmas even if it means screwing the rest of the Greeks.
this blog used to be the domain of people that would object that the devaluation of a currency by a government is "screwing the rest of them"
then enter the EUR... and suddently it's a "too hard" currency that "screws the people"?
People don't bitch at the EUR because its too hard of a currency -- its a strong currency imposed on nations that are culturally used to weak currencies.
Its a money policy//money culture mismatch.
"its a strong currency 1 imposed 2 on nations that are culturally used to weak currencies 3"
sure. because 1) the Mighty USD is not currently again on the top of the hill, 2) Greece signed and ratified no treaty regarding the EUR and 3) because Germans, Hungarians and Austrians did not experience the worst hyperinflations of most of history
you know what? I find often that we should stop using the same vocabulary in Europe and the US. take the way you use the word "culture". at the end, you are talking about something completely different then me, and it just murkies the whole thing
counterquestion: how many "cultures" are there, in the US? one? two? many? are people(s) the US "used to a strong" or "used to a weak" currency? describe the US, once, so that I can... calibrate
Imagine Mexico adapting to US's cost of living with austerity measures in the mix to make the situation even worse.
There are many future pensioners who will object, but they might surprise by doing the logical thing since there is really no alternative.
The fears of leaving the Euro are vulnerability and chaos, but those can be alleviated by having friends with a strong back (Russia) and a deep pocket (China).
Better sacrificing lambs than buggering little children, a favorite activity of the English elite. Just ask Sir Jimmy if you have a medium.
Thanks for saying that.....totally didn't want to go there.
Tiger has 3 stroke handycap at today's par 3.
Yes, GetZee Gold, it is ugly:
http://www.independent.co.uk/news/people/it-was-a-relief-when-i-got-the-...
I wonder why he was awarded a knighthood given his predilection for young boys and corpses.
International Fellatio Exhibition
I'm making over $7k a month working part time. I kept hearing other people tell me how much money they can make online so I decided to look into it. Well, it was all true and has totally changed my life. This is what I do... www.globe-report.com
always the optimist, perhaps they come to a agreement with each other of equal value..a concept lost on most of our bankster crime lords in the west.
+1 for the optimist! but Mr. Tsipras is convinced that there are political solutions to a fiscal sovereign problem
but if he looks in geopolitics for that solution... that field is a zero-sum game, per definition
"my empire becomes smaller if your empire grows"
perhaps the words :" how do we make the bankers whole?" will not see the light of day in this meeting.
the whole western world is a slave to this concept, hidden in layers of a paying off of debt obligation ..this is somehow the most noble act of western man.
overmed, careful with that "The West"
over here, some of us remember how Hank "Tanks on the streets" Paulson was setting up TARP and TALP and at the same time issuing orders to the faithful european allies that if we don't "do something similar" we'd be in big, big doodoo
btw, we did not. but the FED and the ECB had a nice little trillion swap for a year or two. which, btw, is still cursing the 'net as "the FED bailed Europe out". LOL, sure
Guilt and shame are powerful emotions and banksters use them to their full advantage.
The plot thickens...
are they both smiling or rather laughing ?
Good news from Russia and Greece to coincide with our holiest holiday, Orthodox Christian Pascha!!
Forcing the Eurocrats to buckle isn't that difficult to do. Once you go through the motions of exiting the Eurocrats will raise the surrender flag.
All the rest of the PIIGS can then demand the same deal.
"The reason the EU came to Athens’ rescue with two bailouts totaling €240 billion was to protect the euro currency, which is shared by 18 countries including Greece."
sure. straight out of the Chancellor's propaganda on that. lol
the reasons why select EU countries came to rescue are manyfold, but "to protect the EUR"? LOL
I could as well ask how it is that the IMF has to be paid back... first. or why those european loans, which total three quarter of the Greek sovereign debt, don't pay interest until 2023
funny thing, this IMF. when it lends... it's often called "US Taxpayer money". when it collects... it's often called in less endearing terms
I fully expect Putin to rattle more at the "trade cage". it's a convenient tactic, at this moment. will be interesting to see how the trade union called EU will... react
"how the trade union called EU will... react"
your sense of humour Ghordius...
(expect no reaction other than the pretence that they have anticipated everything and take all developments in their stride)
it's not humour. it's the process of finding out that the whole team from SYRIZA is candidly naive about certain things, and shockingly ignorant of others
I'll make an example: Tsipras and Varoufakis had a discussion where they said something like: "we are a sovereign country, we don't have to disclose that number if we don't want to"
at that meeting, a certain person replied: but Greece is a member of the IMF. the obligation of disclosing that figure is part of the treaties/statutes. or do you want to exit... IMF membership?
it's not a good example, but perhaps it conveys a bit that the whole team of the other "EuroCrats" often catch themselves thinking that there is less animosity then expected and more misunderstanding of basic facts, which they take for granted because of their political parties' "historic memory"
but Tsipras has said a few things regarding trade that give me the impression he knows little about that trade union called EU. among the many scopes of trade unions is... how to cope with outsiders that offer "special terms" to one member only. and there are very interesting articles in the treaties about such matters. and I fear Tsipras has very, very little knowledge about that, and is not being adviced properly. at the end, it could even result with Russia getting mad at them. in the history of diplomacy, stranger things have happened
we'll see
463.1 million? fuck that, it's my drinking money...
ps. where does that tidy sum come from? thought they were broke.
463.1 million, really, that is some serious pile of euros. wtf?
While Tsipras is in Moscow, keep an eye on the Greek military. 463.1 million wil pay for a lot of K rations, drinks and ammo. History repeats.
Makes zero sense for Russia to loan Greece money to pay off existing creditors. Russia would then be stuck with Greece's unrepayable debt.
However, very sensible for Russia to tell Greece that should it choose to default on most of its existing loans, Russia would be willing to then provide new loans to Greece to support it through the Grexit process, particularly if there were some strategic benefits on offer.
That's the only scenario that makes sense for both parties and what I think will happen. I also think that China will offer loans if necessary.
APRIL 9 - DEFAULT
NO DEFAULT
When you run out of money and Credit with your bookie. Always have a new bookie lined up before the weekend games and tell the old bookie sorry you are leaving him. Usually the original bookie will open you back up instantly and even increase your limit. Just hoping to get paid , if you hit the lottery.
Tried that once before, now i just send rocco and bruno over there to help the two of them balance their checkbooks.
Greece CANNOT get loans from third parties due to the terms of the EU loans. If somebody could care to explain why such a term was in the loans please do so, I cannot understand the point there. Due to that term, if Russia were to loan Greece money, Greece would have to default on its current loans so that it can legally do so.
Sounds like a plan!
holding the debts of a country is just for control. even better if the country has to make more debts to pay the debts= desired vicious spiral, desired total control.
if greece goes for debts to other countries the nice game is f*kd.
you should see the faces of the troika on tv, a mixture of anger and fear. but also strength, they got more in the sleeve to play out...
and they want the gas.
who's on top?
First investmenet of the AIIB. Greece
Where are the JWO trolls to tell us that Putin is a Natzi and has just invaded Greece?
tsiprasss was busy protesting instead of studying as a student...not the brightest spoon in cupboard
Don't leave out the U.S. and its' corrupt politicians......deals are thier specialty
U.S. Russian MOX Nuclear Fuel Project to Continue Sen. Lindsey Graham Defends Project
Russia’s Eurochem and Lousiana’s Dept. of Energy Real Estate Deal
Everybody wants a piece of Greece but no one wants anything to do with Greeks.
I'm not worried about Greece's ability to repay its creditors. All it has to do is lease some islands to Russia for naval bases and Russia will assume the debt.
Of course, this would mean a reversal of European and Turkish policy since the late 18th century to keep Russia out of the Mediterranean as much as possible.
The ruble is doing quite well these days, if Putin were to lift sanctions, offer cheap gas and other lowest common denominator incentives, rather than fiat, he'd be doing a lot more for the Greek people than offering them more debt.
If 'Sticky Vicky' can say "Fuck the EU" surely the nation of Greece can aswell?
My, my, my said the spider to the fly. Jump ahead in my web...and you're dead!
Greece ready to use force, will only back down if Moscow buys Greek debt.
Source: www.financialpaparazzi.com