German Finance Minister Wolfgang Schaeuble said Sunday Greece could be granted an extension to the repayment of its massive debt but only if private creditors are also involved.

German Finance Minister Wolfgang Schaeuble said Sunday Greece could be granted an extension to the repayment of its massive debt but only if private creditors are also involved.
In an interview with ARD public television, Schaeuble insisted on waiting for the results of an examination of Greek public accounts next month before deciding if new measures were required.
But if they prove necessary, "a central point will be avoided (...) to relieve private creditors at the expense of the taxpayer".
"We must have a clear rule: if there is a rescheduling (of the debt), all credit must be rescheduled," he said.
Officials from the EU, the IMF and the European Central Bank are examining Greek finances and the progress of an austerity programme imposed as a condition of last year's international bailout.
They will report back in June.
The 110-billion-euro ($155 billion) rescue in spring 2010 was the first of three European rescues, followed by Ireland and Portugal.
However a severe recession has complicated Athens' efforts to bring its finances in order.
Greece was expected to return to the financial markets next year but it appears unlikely and there is speculation that it will need further financial assistance.
The German daily Die Welt reported Saturday that the EU Commission, the IMF and Germany were calling for Greece to reschedule its massive debt burden, due to a deteriorating situation.
Citing unnamed sources, Die Welt said the International Monetary Fund (IMF), the European Union executive arm and the government in Berlin believed prolonging the repayment terms on some loans to Greece has become the least worst option to save the country from defaulting.
However the European Central bank and France remain opposed to any such debt restructuring, the article added.
EU Commission spokesman on economic affairs Amadeu Altafaj dismissed the report as "absurd".
"A restructuring of Greek debt is out of the question," he told AFP.
Speculation has mounted in recent days that Greece will need an additional 60 billion euros ($85 billion) over the next two years as it won't be able to return to financial markets next year as expected to re-finance its massive debt.

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Posted in: German Finance Minister Wolfgang Schaeuble said Sunday Greece could be granted an extension to the repayment of its massive debt but only if private creditors are also involved.

IMF Managing Director Dominique Strauss-Kahn decides to seek diplomatic immunity to avoid sexual assault charges

IMF Managing Director Dominique Strauss-Kahn decides to seek diplomatic immunity to avoid sexual assault charges, he will likely have an uphill climb, a Reuters review of U.S. and international laws and treaties, International Monetary Fund policies and recent U.S. court rulings suggests.

Under the IMF's Articles of Agreement, employees are granted a limited form of diplomatic immunity known as "acts immunity," which refer to actions related to activities performed in the course of their work for the Fund. Article IX of the agreement notes that the Fund's staff "shall be immune from legal process with regard to acts performed by them in their official capacity." Even then, the agreement says, the IMF may elect to waive immunity.

The IMF's limited immunity provision is unlikely to protect Strauss-Kahn from prosecution for sexual assault, an expert in international law argued. "Acts immunity only covers actions taken in the course of his duties. Coming out of your bathroom stark naked and attacking a chambermaid probably doesn't qualify," Kurt Taylor Gaubatz, an associate professor in the Graduate Program in International Studies at Old Dominion University, wrote in a blog post on Sunday. Gaubatz did not respond to requests for additional comment.

Federal law in the United States may also make it difficult for Strauss-Kahn to claim diplomatic immunity. The International Organizations Immunities Act applies a limited scope of exemption from prosecution similar to the IMF's own rules. It says "representatives of foreign governments in or to international organizations" and "employees of such organizations" are immune from lawsuits and the legal process "relating to acts performed by them in their official capacity."

On Sunday, New York Police Department spokesman Paul Browne said Strauss-Kahn does not have diplomatic immunity, though Browne did not elaborate on why the NYPD believes diplomatic immunity does not apply. A spokeswoman for the French Consulate in New York, Marie-Laure Charrier, referred questions about possible diplomatic immunity to the IMF. A statement posted on the IMF Web site on Sunday did not address the issue.

Despite the limited immunity provided by IMF rules, Strauss-Kahn could still try to leverage his status as a quasi-diplomat in his legal defense. One of his attorneys is William Taylor, a partner with law firm Zuckerman Spaeder in Washington. Taylor has represented a range of high-profile clients, including former White House chief of staff Mack McLarty, in civil and criminal actions. The Wall Street Journal reported in October 2008 that Taylor also represented Strauss-Kahn in the controversy over an affair the married IMF chief allegedly had with a female subordinate at the Fund. Taylor did not respond to requests for comment on Sunday.

One possible legal defense strategy for Strauss-Kahn could be to try to apply the Vienna Conventions on Diplomatic Relations, which grant broad immunity from prosecution to diplomats serving in foreign jurisdictions. Article 31 of the convention says "a diplomatic agent shall enjoy immunity from the criminal jurisdiction of the receiving State." The U.S. ratified the treaty in 1972. The treaty also renders diplomats immune from prosecution in civil and administrative matters, with some exceptions. Under the convention, diplomats are not immune from "action relating to any professional or commercial activity exercised by the diplomatic agent in the receiving State outside his official functions."

The issue has come up in recent years in civil cases in the United States. Three domestic workers employed by foreign diplomats in the United States have filed federal lawsuits alleging they were underpaid or physically and verbally abused. The workers claimed that their diplomatic employers violated the Fair Labor Standards, and that they are not exempt from prosecution under the Vienna Conventions' exemption for "commercial activity ... outside his official functions." But federal judges have dismissed all of the cases. Most recently, on April 26, U.S. District Judge James Boasberg in Washington threw out a case alleging that Lebanese Ambassador Antoine Chedid and his wife underpaid and verbally abused their maid. His decision relied, in part, on a State Department filing in a separate case, which found that hiring household workers for assistance during diplomatic service is covered by the Vienna Convention's immunity provisions.

On March 25, four former employees of a senior Qatari diplomat in the United States filed a similar abuse case, which also alleges sexual assault, in federal district court in Washington.

To be sure, there may be some precedent for a Strauss-Kahn legal defense that claims diplomatic immunity. Last June, British newspaper the Telegraph reported that Pakistani investigators dropped an inquiry into allegations that Paul Ross, head of the IMF's Pakistan unit, abused his wife by throwing her out of their home. "The police officer dealing with the case said that as soon as they found out that Mr. Ross had diplomatic status they abandoned the case," the Telegraph reported. At the time, the IMF said it was conducting an internal inquiry.

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Posted in: IMF Managing Director Dominique Strauss-Kahn decides to seek diplomatic immunity to avoid sexual assault charges

Greece demands more help and Portugal awaits a bailout

As Greece demands more help and Portugal awaits a bailout, the euro zone crisis is creating political turmoil. Bruno Waterfield in Brussels and Philip Aldrick report.

An undercurrent of anger and mistrust will permeate tonight's critical meeting of euro zone ministers in Brussels as they grapple with a spiralling Greek debt crisis and try to seal a €78 billion ($104 billion) bailout for Portugal. As if the euro's problems were not enough, seething resentments will add a new political dimension to the talks.

The inclement mood was set 10 days earlier. On May 6, Jean-Claude Juncker, Luxembourg's Prime Minister and chairman of the euro group of single currency members, called a secret meeting of the European Union's most powerful countries at the Chateau de Senningen on the outskirts of the tiny Duchy state.

Gathered at the 18th century former paper mill were finance ministers from Germany, France, Italy and Spain - the euro's G20 members, Jean-Claude Trichet, the president of the European Central Bank, and Olli Rehn, the EU commissioner for monetary affairs.

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Top of the agenda was the fate of Greece, after the International Monetary Fund - on the hook for €30 billion of the €110 billion rescue - demanded that the EU come up with a new strategy as Greece continued to plunge into debt and recession.

Sparking rumours that Athens was set to leave the euro, George Papaconstantinou, the Greek Finance Minister, was summoned to explain how his country could take further savage austerity measures and speed up privatisation of lucrative state-owned industries.

As news of the meeting leaked out, financial markets sent the euro into a nosedive. In a desperate bid to end the turmoil, Mr Juncker, who had not informed other euro zone finance ministers of the meeting, chose to lie. ''I totally deny there is a meeting,'' said his spokesman, as speculation mounted.

Mr Juncker had already horrified many of his counterparts by bragging last month that he often ''had to lie'' to suppress public debate over euro zone economic policies which, he claimed, were too important for open contemplation.

''I am for secret, dark debates,'' he said. ''When the going gets tough, you have to lie.''

The lies and the elite gathering sparked a furious response from euro members, as MPs in national parliaments demanded an explanation of what was going on. Gunther Krichbaum, the chairman of the Bundestag's powerful European scrutiny committee, said that he had been ''shocked and dismayed'' at Mr Juncker's deceit.

''That does not create trust on decision-making. That is a very serious mistake, because trust is important,'' he said.

Mr Krichbaum, a senior German MP and member of Angela Merkel's ruling Christian Democrats, warned that conspiracies to deceive the public over bailouts and elite meetings threatened to destroy the euro. ''If we don't pay attention to this then Europe will fall apart,'' he said.

Diplomats from smaller member states, excluded from the talks, accused the big euro countries of playing ''ham-fisted cloak-and-dagger games''. ''Acting like this is almost guaranteed to create crisis, and these are the people in charge. There are going to be some very angry people around the table demanding what the hell are they playing at,'' said an official from a non-G20 euro zone country.

The mistrust, disarray and bitterness could not have come at a worse time, as problems multiply for the euro zone. The Senningen meeting was sparked by heated words at last month's IMF summit in Washington, where the US and Canada demanded assurances that IMF's loans for Greece, Ireland and Portugal would not be wasted. With Greece due to be assessed for a fifth, €3.3 billion tranche of the IMF loan in June, they wanted assurances that the fund was not about to throw good money after bad.

For the IMF, it has been an unusually hands-off process. A typical IMF program consists of a three-pronged remedy: fiscal consolidation and structural reform, debt restructuring, and a currency depreciation. The principle is to create a more competitive economy, while trimming the debt burden.

A falling currency makes the country more competitive, an effect that is augmented by structural reforms such as pay cuts, as happened in Ireland.

However, IMF officials have had their hands tied in Europe. Brussels controls currency and debt. Tweaking the other alone just kills off demand and risks recession, which in turn makes it more difficult to improve the public finances. Greece is a case in point. It is expected to contract 3.5 per cent this year - a European Commission estimate - and last week it revealed it had fallen €313 million short of its target deficit reduction for the first quarter.

Although it cut spending by more than planned, tax receipts suffered a €1.28 billion shortfall ''mainly due to the larger than projected recession'', the Ministry of Finance said. Worse still, the IMF, which is carrying out an assessment of Greece with the EU, is said to be concerned that interest rates on Greek borrowing, at about 13 per cent, are putting the country in an impossible situation.

Athens cannot afford to refinance its €330 billion of sovereign debt at those levels, so it will either become wholly dependent on bailout money or suffer a massive default. Neither is a viable option.

The IMF-EU report on Greece, due to be completed last week and expected to make grim reading, will be used to decide next month whether Athens can no longer comply with the conditions for IMF funds. The answer is expected to be negative, which is why a second rescue is now being discussed.

So severe are the problems that euro zone ministers - including Wolfgang Schauble, Germany's Finance Minister - are contemplating how to restructure Greek debt, fully aware of the risk of financial market turmoil from fears that Ireland and Portugal would also be unable to pay back loans.

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Posted in: Greece demands more help and Portugal awaits a bailout

Europe has moved to reverse decades of unfettered travel across the continent

Europe has moved to reverse decades of unfettered travel across the continent on Thursday when a majority of EU governments agreed on the need to reinstate national passport controls amid fears of a flood of immigrants fleeing the upheaval in north Africa.

In a serious blow to one of the cornerstones of a united, integrated Europe, EU Interior Ministers embarked on a radical revision of the passport-free travel regime known as the Schengen system to allow the 26 participating governments to restore border controls.

They also agreed to combat immigration by pressing for “readmission accords” with countries in West Asia and North Africa to send refugees back to where they came from.

The policy shift was pushed by France and Italy, who have been feuding and panicking in recent weeks over a small influx of refugees from Tunisia. But 15 of the 22 EU states which had signed up to Schengen supported the move on Thursday, with only four resisting, according to officials and diplomats present.

The issue now goes to a summit of EU Prime Ministers and Presidents next month. But the “reforms” of the Schengen system also need to go through the European Parliament where there will be strong resistance to empowering national governments to reinstate controls.

The border-free region embraces more than 400 million people in 22 EU countries as well as Switzerland, Liechtenstein, Norway, and Iceland. It extends from Portugal to Russia's borders on the Baltic and from Reykjavik to Turkey's border with Greece.

The move to curb freedom of travel came as the extreme nationalist right, which is increasingly dictating or influencing policy across Europe, chalked up a notable victory in Denmark, a Schengen country, which announced it was unilaterally re-erecting controls on its borders with Germany and Sweden.

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Posted in: Europe has moved to reverse decades of unfettered travel across the continent

5.2 magnitude earthquake was felt across the Murcia region, where hundreds of British expatriate live, from Alicante to Malaga and as far away as Madrid.

The epicentre was registered in the Tercia mountain range close to the town of Lorca, where several buildings were destroyed including a medieval church bell tower. It was the worst earthquake in Spain for 50 years.
Authorities confirmed that at least ten people had died, including a child of 13 years old.
Francisco Jodar, the mayor of the town said: "Unfortunately people have died as a result of cave-ins and falling debris. We're trying to find out if people have been trapped inside the collapsed houses."
Television images showed streets in the historic quarter of the town strewn with rubble and crushed cars. There were also reports that historical heritage sites as the Sanctuary of the Virgen de la Huerta and several local temples had been damaged.
The local hospital was evacuated raising fears over how those injured would be treated and military units were dispatched to the earthquake zone to help in the rescue.
An earlier quake registering 4.4 on the Richter scale occurred at 5.05pm local time, and the second bigger shock of 5.2 followed at 6.47pm.
Residents in the town, which has a population of around 90,000, described the terrifying moments when the quake struck.
"There was a tremendous roar and the church was split in half," Catalina Lopez, told Spanish state television.
One neighbour said that most people had already left their houses before the second bigger quake struck.
"I felt a movement of such force, and with such noise, that made all the furniture jump about. It was terrifying," said Juani Avellaneda.
"Everyone ran into the street and then when we were thinking it was safe to return to our houses, the shaking started again," he said.
Lorca dates back to the Bronze Age and is thought to have gained its name from the Romans. The old part of the town is made up of a network of narrow alleyways.
Spain is at moderate risk of earthquakes. On average every 200 years an earthquake of over six on the Richter scale occurs. In 2007 an earthquake of 6.3 magnitude struck the region in Cabo Sao Vicente on Portugal's southern coast, with no reports of damage or casualties.

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A 97-year-old Hungarian accused of massacring civilians in Serbia in 1942 has gone on trial in Hungary.

Sandor Kepiro was listed by the Simon Wiesenthal Center as the world's most wanted Nazi war crimes suspect.

More than 1,200 Jewish, Serb and Roma civilians were murdered over three days by Hungarian forces in a notorious massacre in the city of Novi Sad.

As Mr Kepiro arrived at court he told reporters he was "completely innocent" and called the trial a "circus".

After using a walking stick on his way into the court in Budapest, he took his seat and displayed a printed sheet of paper stating: "Murderers of a 97-year-old man!"

The former police captain is accused of "complicity in war crimes".

Prosecutor Zsolt Falvai detailed the charges. He said Mr Kepiro was directly responsible for the death of 36 Jews and Serbs - including 30 who were put on a lorry on the defendant's orders and taken away and shot.

Mr Kepiro denied the charges. He said that, in fact, he had been "the only person to refuse the order to use firearms", and that he had intervened to save five people about to be killed by a corporal.

'No clemency'
Hundreds of families were rounded up by the Hungarians, allies of Nazi Germany, in January 1942 on the banks of the Danube River in Novi Sad and then shot.

Sandor Kepiro was convicted of involvement in the killings in Hungary in 1944 but his conviction was quashed by the fascist government and he later fled to Argentina.

He returned to Hungary in 1996 and was tracked down by the Nazi-hunting Simon Wiesenthal Center a decade later to a flat opposite a synagogue in Budapest.

Mr Kepiro had sued the director of the Center, Efraim Zuroff, for defamation. But that case was dismissed on Tuesday. The Budapest tribunal said Mr Zuroff had the right to call him a war criminal because of the 1944 verdict.

On Thursday Mr Zuroff said it was imperative that Nazis were brought to justice.

"There can be no clemency, no sympathy and no ignoring of the facts," he said.

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Posted in: A 97-year-old Hungarian accused of massacring civilians in Serbia in 1942 has gone on trial in Hungary.

A body from the 2009 Air France crash that killed all 228 people aboard has been raised from the depths of the Atlantic Ocean.

Floating wreckage was recovered soon after the crash
The body has been preserved by high pressure and low temperatures while it lay in the submerged wreckage for nearly two years.
And it was still belted to an airline seat as French investigators brought it aboard their search vessel off Brazil's northeast coast from a robot submarine.
The search party located the wreckage a month ago after nearly two years of scouring the seabed.
In recent days they also found the Airbus A330's cockpit voice recorder and 'black box' data memory unit.

The black box recorder located after two years
If the units are in good condition, they could solve the mystery about why Flight AF447 from Rio de Janeiro to Paris fell into the Atlantic during an intense high-altitude thunderstorm.
They were discovered about 3,900m (12,800ft) below the surface by submarine.
A statement from the French Gendarmerie, which has experts on a recovery boat, said that the body was pulled up on Thursday morning.
Recovering the remains involved great technical difficulty, it said, and it is unclear if all the bodies found in the latest search can be recovered.

A spokesman for the recovery operation said: "It's difficult because the bodies are well preserved on the seabed with the pressure and the temperature, but bringing them up through warmer water causes decomposition."
The French Interior Ministry said in a statement that investigators on board the search vessel had taken DNA samples from the body, which would be sent back to France along with the two black boxes and used to try and identify the victim.
Theories about the cause of the disaster have focused on the possible icing up of the aircraft's speed sensors, which seemed to give inconsistent readings before communication was lost.

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Posted in: A body from the 2009 Air France crash that killed all 228 people aboard has been raised from the depths of the Atlantic Ocean.

The surge of north African migrants into Italy and France will mean Europe will impose internal passport border controls once again to stop the flow of illegal arrivals

The surge of north African migrants into Italy and France will mean Europe will impose internal passport border controls once again to stop the flow of illegal arrivals, if proposals before EU home ministers are approved.

The so-called Arab spring has led to a massive wave of immigration from north-western Africa to the tiny Italian island of Lampedusa following the Tunisian uprising and air strikes in Libya.

Most of the young immigrants arrive in overcrowded fishing boats and have paid traffickers. They are processed on Italian soil and provided with temporary papers before heading north to France in the search of work.

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Italy has granted temporary permits to more than 25,000 Arab migrants in the past couple of months, although the mainly French-speaking Tunisian immigrants generally head to France.

France has closed a railway frontier near the Italian border town of Ventimiglia and imposed extra checks on the papers of all immigrants.

The Italian government has argued for years that the influx is a Europe-wide problem and that measures to discourage the arrivals, and absorb those already in Europe, must be international. The proposals to allow the 25 countries within the passport-free Schengen zone to close their frontiers were unveiled on Wednesday at the European Commission and will be debated at a meeting of EU home affairs ministers next week.

Under the plan, it would be the EU itself that made the decision on whether each situation is classified an ''emergency''. The EU Home Affairs Commissioner, Cecilia Malmstrom, said the moves would be strictly monitored and ''very limited''.

She said the EU could step in to handle situations where either a member state is ''not fulfilling its obligations to control its section of the external border, or where a particular portion of the external border comes under unexpected and heavy pressure due to external events''. Ms Malmstrom said: ''We are seeing exceptional events across the Mediterranean.''

The EU is now also to consider allowing an intensification of surveillance as well as checks at national borders after increasing demands from France and Italy for a review of the Schengen agreement, which does not include Britain.

These calls have been viewed with alarm by many other European states which believe that the free movement of people across borders is a fundamental plank of the common market and political union.

There is also likely to be consternation at the European Commission being the decision-maker on what constitutes exceptional circumstances, as it means Brussels will take control from national capitals.

During the past three years, Mediterranean nations including Italy have attempted to reach agreements with north African nations, including Libya, to discourage the departure of immigrants from their coastlines.

Thousands of sub-Saharan refugees, particularly Nigerians, have been trafficked from the north African coastline to Lampedusa after long road trips. However, the uprisings in North Africa have changed this.

The European Council on Refugees and Exiles argues that Europe cannot encourage democracy in north Africa and then turn its back on people fleeing conflict.

The proposals will be submitted to an emergency meeting of EU interior ministers next Thursday.

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Posted in: The surge of north African migrants into Italy and France will mean Europe will impose internal passport border controls once again to stop the flow of illegal arrivals

EU looking at reintroducing national border controls

The European Union's executive has proposed allowing the reintroduction of national border controls in exceptional circumstances, even though the development of a "borderless" continent had long been hailed as a prime EU achievement.
The EU Commission made the proposal Wednesday after France and Italy insisted on action to revamp the so-called Schengen system, which allows for unfettered travel across many European borders for citizens, but also for illegal immigrants.
EU Home Affairs Commissioner Cecilia Malmstroem said that "it may also be necessary to foresee the temporary reintroduction of limited internal border controls under very exceptional circumstances."
Malmstroem said one reason for such border checks could be when "part of the external border comes under heavy unexpected pressure" but she did not say if that would include the situation in Italy, which has recently received more than 25,000 illegal immigrants, mostly from Tunisia.
The Commission's proposal will now be submitted to a special meeting of EU interior ministers on May 12 and a meeting of EU government leaders June 24.
Touching on such a cornerstone of EU policy already raised objections, especially within the European Parliament, and among member states.
"Greece believes that freedom of movement within the Schengen Area must be jealously preserved, for it is the most fundamental pylon of European unification," said Greek Citizens Protection Minister Christos Papoutsis.
Malmstroem insisted that even though border controls may be temporarily coming back, it would not become the norm over the next years.
"The free movement of people across European borders is a major achievement which must not be reversed," she said. Part of her proposal also centred on how the whole of the EU should help nations at the bloc's external borders such as Italy.
"We should not leave it only up to the member states at our external borders to deal with extraordinary migratory situations," Malmstroem said.
The borderless Europe started to become unstuck last month when the Italian government complained about the thousands of illegal immigrants from Tunisia flooding into the country. When other EU nations didn't help Italy out, Rome piled on the pressure and provided thousands of Tunisians with travel documents to move to neighbouring France and beyond.
In retaliation, France beefed up controls close to Italy's border and send many back. French President Nicolas Sarkozy and Italian Prime Minister Silvio Berlusconi then came up with a compromise proposal to revamp the Schengen system, including the reintroduction of border controls.

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Posted in: EU looking at reintroducing national border controls

Russian customs officials detained a train conductor who tried to smuggle equipment for a supersonic strategic bomber across the border with Ukraine, the customs service said Wednesday.

Customs officers doing a check in western Russia's Bryansk customs check point found a box in the conductor's train compartment on the train going from Moscow to Ukraine's Odessa.

"According to the train conductor, the box contained a car battery charger which was given to him by an unknown man who asked to take it to a friend in Kiev," customs spokeswoman Faina Svedovaya told Interfax.

However, a weapons expert concluced that the device was a "combined airspeed indicator used on military aircraft Tu-22M and Tu-160," she said.

Both are Soviet-designed supersonic bombers that are presently used in the Russian and Ukrainian military.

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Posted in: Russian customs officials detained a train conductor who tried to smuggle equipment for a supersonic strategic bomber across the border with Ukraine,the customs service said Wednesday.

Big Spanish banks will demand some kind of government-backed insurance against losses before buying into troubled savings banks

Big Spanish banks will demand some kind of government-backed insurance against losses before buying into troubled savings banks that have failed to capture interest from private investors, market players say.

The Bank of Spain is testing interest from larger banks in Caja Mediterraneo (CAM) (CAHM.MC), Spanish media reported on Friday, after the troubled savings bank failed to go through with a state-driven merger with three other regional banks.

CAM said later in the day it would seek 2.8 billion euros ($3.96 billion) state funds via the state-backed bank restructuring fund, or FROB, to boost its capital. It added that it would encourage new partners if they could help with its future plans.

Spain's mainly unlisted regional savings banks are scrabbling to find ways to raise capital by stock market listings, private equity investment or state funds after the government demanded they increase reserves to tough new levels.

"If Santander or BBVA buy CAM it is only because the Bank of Spain has begged them to do so and they have a guarantee," said one Madrid-based legal source.

Spain is overhauling the unlisted savings banks, or 'cajas,' to distance itself from fellow indebted euro zone members like Ireland which on Thursday unveiled a 24 billion euros funding gap on banks' balance sheets.

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Posted in: Big Spanish banks will demand some kind of government-backed insurance against losses before buying into troubled savings banks

Head of bailout fund Klaus Regling says Ireland’s debts are sustainable and default would be ‘unwise’

IRELAND’S EXPANDING bank rescue just got bigger, Portugal’s plight worsens by the day and Greece seems as far away as ever from salvation. But Klaus Regling, chief of the euro zone bailout fund, insists EU leaders have finally turned the corner in their titanic battle against the sovereign debt crisis.

“In the summer of last year, the majority of market people in New York thought the euro would have disappeared in three years. This was not the situation east of here. In Asia, people had a different view. But in London, New York, that perception that existed last summer, has turned around,” he says in his sparse Luxembourg office.

“My conclusion from that very clearly is that the strategy that was adopted to preserve financial stability in the euro area is working. It doesn’t mean that all problems have been resolved, but overall the euro is no longer questioned. We are now dealing with a difficult situation in three countries and that’s very different from six or nine months ago.”

Regling, who may yet succeed European Central Bank president Jean-Claude Trichet this autumn, was handpicked by euro zone finance ministers last June to lead the nascent European Financial Stability Facility (EFSF).

This is the temporary rescue fund from which Ireland will draw down a total of €17.7 billion in the course of its EU-IMF bailout. Also in train is a permanent new fund, the European Stability Mechanism (ESM), whose operations start in 2013.

A crisp German with a direct no-nonsense style, Regling is known in Ireland for writing an unsparing dissection of the banking debacle for Brian Cowen’s government.

Reviewing Ireland’s present situation, he holds rigidly to the line that the mountainous debt burden is sustainable and that there should be no move to scorch senior bank bondholders. “We have a strategy which works without breaking promises,” he says in an interview with four European papers.

None of that should come as a surprise, but it is at odds with the stance adopted by Irish Ministers right up to the conclusion of the stress tests. The latest recapitalisation bill is enormous, but Regling points out that it does not exceed the €35 billion set aside for banks in the EU-IMF package.

“As that number is around €25 billion, it is well within the existing programme. We have the judgment of the IMF and the [EU] commission that this programme, if everything is implemented on the Irish side also, will lead to a sustainable situation.”

Minister for Finance Michael Noonan arrived in office uttering dire warnings that the increasing bank debt could overwhelm the State, but Regling believes Ireland can carry the burden. This means debt restructuring – code for default – is not in prospect.

“These are scenarios which are discussed in the media, by academics but not by us, not in the policy world. We have a programme with Ireland. There’s another operation with Greece, which was done before the EFSF was created, and we don’t have any other at the moment,” Regling says.

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Posted in: IRELAND’S EXPANDING bank rescue just got bigger

European Union immigration commissioner Cecilia Malmstroem warned France Friday it is on a collision course with the law by returning Tunisian migrants to Italy.

European Union immigration commissioner Cecilia Malmstroem warned France Friday it is on a collision course with the law by returning Tunisian migrants to Italy.
"The French authorities cannot send them back to Italy," Cecilia Malmstroem said, as a row grows over how a treaty governing frontier management throughout the borderless Schengen area on mainland Europe is implemented.
The emergence of the spat came as Italian premier Silvio Berlusconi threatened to "grant temporary permits" to migrants saying they wanted to join family in France, Germany and other EU nations.
The papers "would allow them to circulate freely in Europe," Berlusconi underlined of a move his government says is designed to "put pressure" on partners in the face of "an utter refusal to collaborate."
Italian Foreign Minister Franco Frattini complained this week that France was failing to show solidarity with Rome, the first port of call for an outpouring of some 20,000 migrants, most of them Tunisians, amid unrest in Arab north Africa.
The issue revolves around what Paris calls "episodic" controls at the invisible border, whereas Malmstroem says the Schengen treaty "forbids" systematic controls that resemble those at the old physical frontiers.
Likewise, Brussels complains that emergency powers allowing the restoration of temporary borders can only be implemented when permission is sought of the commission.
The problem is compounded by the existence, since 2000, of an agreement between France and Italy that the former can return migrants without rights from third-party states.
"France could evoke a serious threat to public order, but this is not the case here," Malmstroem nevertheless said.
Scores of Tunisian immigrants arrive every day in the town of Ventimiglia, the last in Italy before the French border, only to be turned back when they cross the invisible frontier.
Typically they have landed in the south of Italy on makeshift boats, often on the tiny island of Lampedusa, before being transferred to reception centres on the mainland.
From there they travel by train to Ventimiglia hoping to enter France where many have relatives.
Rome frequently accuses EU partners of abandoning it in its battle against clandestine immigration.
The issue of immigration from Tunisia and surrounding countries will be tackled by EU interior ministers on April 11.

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Posted in: returning Tunisian migrants to Italy.

Two women have been hurt in a suspected letter bomb explosion at offices belonging to lobby group Swissnuclear in the northern Swiss city of Olten.

Both women have been taken to hospital for treatment but are not thought to be seriously hurt.

The lobby group represents a number of Swiss power companies. The building also contains a branch of UBS bank.

Switzerland responded to Japan's nuclear crisis this month by halting a decision on new power stations.

Six people were working in the sixth floor offices apparently targeted by blast, Swiss media report.

Police said the lives of the two women caught up in the explosion were not in danger.

The UBS bank branch in the same building was said to have been unaffected.

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Posted in: Swissnuclear in the northern Swiss city of Olten.

A shop will open on the Champs-Elysees later this year and a French website will open too. M&S will also open a chain of Simply Food stores.

A shop will open on the  later this year and a French website will open too. M&S will also open a chain of Simply Food stores. This is a huge move. But also a huge risk.
M&S lost an incredible amount of goodwill when it closed the shops in 2001, including 18 stores in France.
On the day that the closures were announced, Agence France-Presse ran the following snippet: "Employees of Marks and Spencer's 18 stores in France react with shock and indignation to news that the company's entire operation on continental Europe is shutting down."
There followed noisy protests, and books of condolence were placed in stores.
It was not only the fact that M&S was pulling out that shocked customers, it was the manner in which M&S did it. The move took its staff by surprise and they accused M&S of bungling the announcement.

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Posted in: Champs-Elysees

Sources close to BP deny that its strategic alliance with Rosneft will be jeopardised by Kremlin moves to force the resignation of the Russian energy group's chairman, Igor Sechin.

Sources close to BP deny that its strategic alliance with Rosneft will be jeopardised by Kremlin moves to force the resignation of the Russian energy group's chairman, Igor Sechin.

Russia wants to remove government representatives from the helm of state-run companies to improve corporate governance and the country's investment climate, president Dmitry Medvedev said in a speech in the Urals.

Sechin, Russia's deputy prime minister, was one of the architects of a $16bn (£10bn) share swap deal signed in January that involves BP and Rosneft teaming up to explore the Arctic seabed for oil. That venture is already facing obstacles after BP's current Russian partners, TNK-BP, won a temporary court blocking order last month. The oligarchs behind the joint venture argued that under the terms of a shareholder agreement any new business initiatives in Russia should come through TNK-BP.

Although BP refused to issue a formal comment about Sechin, people close to the company said his departure would not make any difference to plans to ally itself with Rosneft; BP was confident the venture would be waved through.

Medvedev is calling for the resignation of all government ministers from state-run firms ahead of shareholder meetings in June. During his speech, the president criticised the government's increasing role in the economy, which could put him on a collision course with prime minister Vladimir Putin, who is viewed as more hardline. It is not certain yet whether the two will stand against each other in upcoming presidential elections.

Sechin is a former aide to Putin and has been dubbed Russia's energy tsar after building up Rosneft as the country's pre-eminent oil company via a merger with Yukos. Chris Weafer, chief strategist at Russian bank UralSib, said Sechin's resignation would not change the Russian landscape for BP: "The deal is a strategic one for Russia and transcends the personalities involved. It's something Russia wants to do. Rosneft is the country's largest oil company, but everyone knows it needs western know-how and expertise to find and extract the huge deposits that lie beneath the Arctic shelf."

Russian analysts played down the idea of a possible rift between Putin and Medvedev saying that when it came to strategic issues such as exploration and production in the Arctic, they "were singing from the same hymn sheet."

BP's investors expressed concern the removal of Sechin would mean the British company no longer had a hotline to the Kremlin, but others were more circumspect. Russia's Alfa Bank said: "The move is unlikely to change anything, as the exclusion of ministers and deputy prime ministers from boards of directors does not necessarily mean they will lose their influence over the companies' actions or ability to support them." Alfa said the state woud still retain majority stakes in its leading companies even after the planned sell down of government shares to 51% over the next three years. One analyst said: "Ministers will still be able to influence events by issuing binding directives."

But Prosperity Capital, which manages Norway's sovereign oil fund investments in Russia, welcomed the initiative, saying it would give a major boost to Russia's investment case.

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Posted in: Igor Sechin.,Sources close to BP deny that its strategic alliance with Rosneft will be jeopardised by Kremlin moves to force the resignation of the Russian energy group's chairman

US is preparing to pull its attack planes out of the coalition airstrikes in Libya

US is preparing to pull its attack planes out of the coalition airstrikes in Libya - as rebel fighters are pushed back to the eastern town of Brega by Colonel Gaddafi's advancing troops.


US Defence Secretary Robert Gates and Joint Chiefs of Staff chairman Admiral Mike Mullen said American combat missions would end on Saturday, with Nato partners and other coalition nations picking up the slack.
Mr Gates said no-one should be surprised by the move, but he called the timing "unfortunate".
After coalition airstrikes began on March 19, the rebels raced forward to recapture the towns of Ajdabiyah, Brega and Ras Lanuf.
Mr Mullen said 25% of Libyan military hardware had been destroyed.

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Posted in: US is preparing to pull its attack planes out of the coalition airstrikes in Libya

Italy has transferred 1,716 North African migrants - most of them Tunisian - to a temporary camp site in its south-eastern Puglia region.

Italy has transferred 1,716 North African migrants - most of them Tunisian - to a temporary camp site in its south-eastern Puglia region.

The migrants arrived by ship on Thursday from Lampedusa, a tiny island packed with thousands fleeing poverty and unrest in Tunisia.

A "tent city" has been set up to accommodate them in Manduria, a town in the southern heel of Italy.

Overcrowding has created unhygienic conditions on Lampedusa, officials say.

Italy's Il Giornale newspaper says Rome is planning to repatriate 100 Tunisians every day.

Prime Minister Silvio Berlusconi will visit Tunis on Monday to discuss the migrant influx with the authorities.

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Posted in: 716 North African migrants - most of them Tunisian - to a temporary camp site in its south-eastern Puglia region.,Italy has transferred 1

Hundreds of thousands of websites appear to have been compromised by a massive cyber attack.

The hi-tech criminals used a well-known attack vector that exploits security loopholes on other sites to insert a link to their website.

Those visiting the criminals' webpage were told that their machines were infected with many different viruses.

Swift action by security researchers has managed to get the sites offering the sham software shut down.

Code control
Security firm Websense has been tracking the attack since it started on 29 March. The initial count of compromised sites was 28,000 sites but this has grown to encompass many times this number as the attack has rolled on.

Websense dubbed it the Lizamoon attack because that was the name of the first domain to which victims were re-directed. The fake software is called the Windows Stability Center.

The re-directions were carried out by what is known as an SQL injection attack. This succeeded because many servers keeping websites running do not filter the text being sent to them.


The fake security software warns about non-existence viruses on victims' PCs
By formatting the text correctly it is possible to hide an instruction in it that is then injected into the databases these servers are running. In this case the injection meant a particular domain appeared as a re-direction link on webpages served up to visitors.

Reports suggest that the attackers are hitting sites using Microsoft SQL Server 2003 and 2005 and it is thought that a weakness in associated web software is proving vulnerable.

Ongoing analysis of the attack reveals that the attackers managed to inject code to display links to 21 separate domains. The exact numbers of sites hit by the attack is hard to judge but a Google search for the attackers' domains shows more than three million weblinks are displaying them.

Currently the re-directs are not working because the sites peddling the bogus software have been shut down.

Also hit were some web links connected with Apple's iTunes service. However, wrote Websense security researcher Patrick Runald on the firm's blog, this did not mean people were being redirected to the bogus software sites.

"The good thing is that iTunes encodes the script tags, which means that the script doesn't execute on the user's computer," he wrote.

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Posted in: Hundreds of thousands of websites appear to have been compromised by a massive cyber attack.

Irish bank shares hit after stress tests show another €24bn needed

Irish bank shares hit after stress tests show another €24bn needed
Ireland's banks received widely different reactions from the market to the news they need to raise another €24bn (£21bn), with Bank of Ireland's shares jumping more than 30pc while Irish Life & Permanent suffered a 60pc slump.

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Posted in: Irish bank shares hit after stress tests show another €24bn needed