Home » Posts tagged 'Czech Republic'
Tag Archives: Czech Republic
When it comes to political assassinations, 2014 is starting off with a bang, literally. Moments ago news broke that following an explosion in Prague, the Palestinian ambassador to the Czech Republic has just been killed.
Firefighters search an area after an explosion in Prague January 1, 2014. The Palestinian ambassador to Czech Republic Jamal al-Jamal has died after an explosion at his residence in Prague on Wednesday, according to Czech police.
Ambassador Jamel al-Jamal was in his apartment with his family at the time of the explosion on Wednesday, according to Palestinian Embassy spokesman Nabil El-Fahel. Al-Jamal was seriously injured and rushed to a hospital, where he died, according to police spokeswoman Andrea Zoulova.
The Palestinian Foreign Ministry said the blast occurred when the 56-year-old diplomat was moving an old office safe box. It was not immediately clear how the explosives got there, and the ministry said the blast was being investigated.
Prague rescue service spokeswoman Jirina Ernestova said al-Jamal was placed in a medically induced coma when he arrived at Prague Military Hospital.
She said a 52-year old woman was taken to a different hospital in Prague after suffering from shock.
The ambassador’s apartment is in Prague’s Suchdol neighborhood.
Once we see any news on who the alleged perpertrators are, we will update this post.
The global currency wars are heating up again as central banks embark on a new round of easing to combat a slowdown in growth.
The European Central Bank cut its key rate last week in a decision some investors say was intended in part to curb the euro after it soared to the strongest since 2011. The same day, Czech policy makers said they were intervening in the currency market for the first time in 11 years to weaken the koruna. New Zealand said it may delay rate increases to temper its dollar, and Australia warned the Aussie is “uncomfortably high.”
A customer selects two hundred denomination Czech koruna currency notes from her wallet in Prague, Czech Republic. Photographer: Martin Divisek/Bloomberg
Nov. 11 (Bloomberg) — Sean Callow, a senior currency strategist at Westpac Banking Corp. in Sydney, talks about the U.S. and the Australian dollars, and global trading strategy. He speaks with Rishaad Salamat on Bloomberg Television’s “On the Move.” (Source: Bloomberg)
Nov. 11 (Bloomberg) — Peter Rosenstreich, head of market strategy at Swissquote Bank SA, talks about the outlook for the Australian dollar and the U.S. dollar. He spoke Nov. 8 from Geneva. (Source: Bloomberg)
A pedestrian passes advertisements for koruna currency coins in Prague. The Czech National Bank drove its koruna down by 4.4 percent versus the euro on Nov. 7, the most since the single currency’s creation in 1999, when it intervened to spur inflation. Photographer: Bartek Sadowski/Bloomberg
The moves threaten to spark a new round in what Brazil Finance Minister Guido Mantega, seen here, in 2010 called a “currency war,” barely two months after the Group of 20 nations pledged to “refrain from competitive devaluation.” Photographer: Peter Foley/Bloomberg
“It’s a very real concern of these countries to keep their currencies weak,” Axel Merk, who oversees about $450 million of foreign exchange as the head of Palo Alto, California-based Merk Investments LLC, said in a Nov. 8 telephone interview. ECB President Mario Draghi, “persistently since earlier this year, has been trying to talk down the euro,” Merk said.
With the outlook for the global economy being downgraded by the International Monetary Fund and inflation slowing to levels that may hinder investment, countries and central banks are revisiting policies that tend to boost competitiveness through weaker currencies.
The moves threaten to spark a new round in what Brazil Finance Minister Guido Mantega in 2010 called a “currency war,” barely two months after the Group of 20 nations pledged to “refrain from competitive devaluation.”
“We’re seeing a new era of currency wars,” Neil Mellor, a foreign-exchange strategist at Bank of New York Mellon in London, said in a Nov. 8 telephone interview.
The ECB lowered its benchmark rate on Nov. 7 by a quarter-point to a record 0.25 percent, a reduction anticipated by just three of 70 economists in a Bloomberg survey. Draghi said the cut was to reduce the risk of a “prolonged period” of low inflation and the euro’s strength “didn’t play any role” in the decision. Euro-region consumer-price inflation has remained below the ECB’s 2 percent ceiling for the past nine months.
The euro slumped as much as 1.6 percent against the dollar on the day of the rate cut, the most in almost two years, before ending the week at $1.3367. It rose 0.2 percent today to $1.3390 at 10:01 a.m. in London.
The shared currency pared gains versus a basket of nine developed-market peers this year to 5.6 percent, from as much as 7.2 percent at its Oct. 29 peak, Bloomberg Correlation-Weighted Indexes show.
“There are places in the world where economies are generally quite weak, where inflation is already low,” Alan Ruskin, global head of Group-of-10 foreign exchange in New York at Deutsche Bank AG, the world’s largest currency trader, said in a Nov. 8 phone interview. “Japan was in that mix for 20-odd years. Nobody wants to go there” and “the talk from Draghi shows they’re taking the disinflation story very seriously. The Czech Republic is the same story.”
The Czech National Bank’s drove its koruna down by 4.4 percent versus the euro on Nov. 7, the most since the single currency’s creation in 1999, when it intervened to spur inflation. Governor Miroslav Singerpledged to keep selling koruna “for as long as needed” to boost growth.
The IMF last month cut its forecast for global economic growth to 2.9 percent in 2013 and 3.6 percent in 2014, from July’s projected rates of 3.1 percent and 3.8 percent. It also sees inflation in developed economies remaining short of the 2 percent rate favored by most central banks.
Growth in global trade may slow to 2.5 percent in 2013, the new head of the World Trade Organization said after a Sept. 5-6 summit of G-20 nations in St. Petersburg, Russia, down from the organization’s previous estimate in April of 3.3 percent. Even so, the G-20 participants agreed to “refrain from competitive devaluation” and not “target our exchange rates for competitive purposes.”
“The idea that central banks are setting policies to weaken their currencies has always been overstated,” Adam Cole, Royal Bank of Canada’s head of G-10 currency strategy in London, said in a Nov. 8 phone interview. “In most cases they’re happy to see their currencies fall, but they’re not going out of their way to induce weakness.”
German airline Deutsche Lufthansa AG cited the strong euro last month when its profit estimate fell short of analysts’ forecasts, while French luxury-goods maker LVMH Moet Hennessy Louis Vuitton SA said on Oct. 16 that the currency’s gains versus the dollar and Japanese yen shaved 6 percent off third-quarter revenue.
Lufthansa said on Oct. 22 this year’s operating profit will be 600 million euros to 700 million euros, below an estimate of about 918 million euros by analysts surveyed by Bloomberg.LVMH, whose Louis Vuitton brand’s founder built his reputation as a luggage-maker for the wife of Napoleon III, said it has hedged 90 percent of its euro-yen exposure for this year and about 66 percent for next year.
“Do I think the euro-zone central bank wanted to engage in a currency war?” Lane Newman, a director of foreign exchange at ING Groep NV in New York, said in a Nov. 8 phone interview. “I think, post facto, yes. Because they cut rates knowing it was going to put the euro on the back foot.”
While the ECB hasn’t said it’s explicitly targeting the euro, comments from policy makers signal they consider exchange rates in their decisions. An ECB spokesman declined to comment when contacted on Nov. 8.
“As you know, the exchange rate is not a policy target for the ECB,” Draghi said at a press conference on Oct. 2. “The target for the ECB is medium-term price stability. However, the exchange rate is important for growth and for price stability. And we are certainly attentive to these developments.”
At the same time the ECB is easing, the U.S. Federal Reserve said it will keep printing enough dollars to buy $85 billion of bonds each month because the economy is still too weak to stand on its own. The Bank of Japan is also employing a policy of quantitative easing.
Reserve Bank of New Zealand Governor Graeme Wheeler has cited the risk of slow inflation and currency gains as reasons for not raising the nation’s official cash rate from a record-low 2.5 percent this year. That’s even with the need to tackle what he has described as an overheated housing market. The kiwi rose 4.5 percent in the past four months, Bloomberg Correlation Indexes show.
Australia’s dollar is 27 percent overvalued against the greenback, according to a gauge of purchasing-power parity compiled by the Paris-based Organization for Economic Cooperation and Development.
The Reserve Bank of Australia lowered its growth estimate for next year to 2 percent to 3 percent, compared with 2.5 percent to 3.5 percent three months ago. South Korea’s finance ministry said last month it may act to counter “herd behavior” in the currency, as the Bank of Korea lowered its outlook for the economy.
The Fed said in October it needed to see more evidence of a U.S. recovery before it trims the Treasury and mortgage-bond purchases it uses to pump money into the financial system.
Analysts surveyed by Bloomberg last week predicted the Fed would delay tapering until March even though a Labor Department report on Nov. 8 showing employers added a larger-than-forecast 204,000 workers in October.
“People aren’t as content as they once were about being on the end of dollar weakness, and hence an appreciation of their own currencies,” Bank of New York’s Mellor said. “We’ve had a change in tone from South Korea, Australia and New Zealand.”
It’s the “Wild East” of the European Union. Here nationalism, cronyism,anti-Semitism, anti-Roma racism and corruption — above all corruption— strut and dominate the public arena.
Where to begin?
Perhaps in the Czech Republic. They’re holding parliamentary elections on the weekend. The reason? The Czech government collapsed because the prime minister, Petr Nečas, was forced to resign.
His senior aide, who was also his lover and is now his wife, had ordered the country’s security services to spy on the prime minister’s then wife and report back. The aide wanted to push through a speedy divorce.
Then there’s Romania where large street demonstrations against corruption are the order of the week, the month, the year, not to mention last year and the year before.
The demonstrations have brought down ministers and governments without ending the problem.
- Police end protesters siege of Bulgarian parliament
- Canadian gold mine project in Romania could go to referendum
The added twist this fall is that the demonstrations have been against corruption AND the development of the Rosia Montana open-pit gold mine, the biggest in Europe, which is owned by a Canadian company.
Next door, in Bulgaria, things are even wilder. In February, 100,000 people stormed through the streets protesting against unemployment, corruption and high electricity prices. The government resigned.
In June, a new government appointed a so-called security czar, Delyan Peevski, a 32 year old referred to coyly as “a media mogul with dubious friends.”
He also had no experience in policing or security. Within 36 hours he was gone, the victim of a huge public backlash. The backlash continued for 40 days, with demonstrations getting bigger and bloodier.
The irony is that bringing these countries into the union in the last dozen years was supposed to be the first step to emptying the swamp of corruption.
Each of these nations had to sign “governance agreements” that committed them to cleaning up their acts. That clean-up hasn’t happened.
Instead European money, rivers of it, has flowed in to build roads, restore buildings and improve a stagnant infrastructure.
Large chunks of that money has simply gone missing. In effect, Europe has magnified, not reduced, the corruption problem by putting more cash up for grabs.
Hungary, a special case
Hungary doesn’t quite fit the mould of the other three countries as it combines nationalism, corruption and the rise of the extreme right.
Once, a dozen years ago, Viktor Orban, Hungary’s prime minister, was hailed by outsiders as the best post-Communist leader the country had had.
Now, three years after his return to power in 2010 he has become a strident nationalist who denounces Brussels, the headquarters of the European Union, of which his country is a member, as the “new Moscow.”
The EU parliament returned the compliment, officially rebuking his government for working to strip the Hungarian judiciary and media of their independence and for rewriting the country’s constitution to suit its whims.
But that’s only a taste of Hungary’s current anxieties.
The country’s fastest growing party is Jobbik, an extreme right-wing group that polled 17 per cent in the 2010 elections, largely by attacking the Roma minority (roughly 800,000 in a country of 10 million) in virulent terms.
Roma were “Gypsy criminals,” Jobbik leader Gabor Vona, shouted from podiums. Other Jobbik leaders railed against “Jews and financiers” as well.
Jobbik created its own vigilante group, calling it the Hungarian Guard and giving it uniforms and symbols that intentionally recalled those of the pro-Nazi militia of the 1930s and ’40s.
The Orban government tolerated this and then, this spring, went further when its minister of culture awarded the country’s highest award for journalism to a man who had called the Roma “monkeys” and was known for his scarcely-veiled anti-Semitic remarks.
Oligarchs and mafia
Hungary’s position on the Roma is the most glaring, but official attitudes towards that group in all four countries are unforgiving.
It’s an ongoing headache for Brussels and for countries like France that find themselves trying, and failing, to cope with the inflow of Roma from Eastern Europe.
Just as worrying for Brussels is the continuing rampant corruption in these former Soviet satellites.
Bulgaria is the worst case. It is the poorest country in the EU and many leaders in Brussels, not to mention the legion of Bulgarian protestors, believe that much the state is beholden to “oligarchs” or “mafias.”
So glaring is the problem that when tens of thousands of protesters filled the streets of Sofia, the Bulgarian capital, this summer to denounce corruption and the government, European justice commissioner Viviane Reding went along, to meet the demonstrators, and tweeted, “Here in Sofia my sympathy is with Bulgarian citizens who are protesting against corruption.”
Alas, the tweets and weeks of protests were not enough to force the government to resign.
Compared to Bulgaria, the Czech Republic is far richer but hardly immune from corruption and cronyism. In the two-year period before Nečas was forced to resign, a former defence minister, a former top aide to a prime minister, an MP and governor of a large province and the mayor of Prague were all charged with crimes relating to fraud, bribes and corruption.
In Romania, a report in July by the country’s National Agency for Integrity said that half the mayors should resign because of conflicts of interest. They sat on the boards of companies their cities were giving contracts to.
Throughout all of this, EU leaders look on and cluck censoriously. They do little more.
It has been less than a quarter-century since these countries cast off the Communist yoke. But whether it’s the centralization of all power, as in Hungary, or the dead hand of corrupt elites, the ways learned in the days of Soviet domination persist.
The Wild East still thrives.
- Why There Has Been a Rise of the Far Right (hungarianfarright.wordpress.com)
- Neo-Nazis mobilise against minorities in Czech republic (dokmz.wordpress.com)
- Jobbik’s menacing shadow over Hungary (politics.hu)
- Czech prime minister steps down amid scandal (cbc.ca)
- Czech PM to step down over scandal (rinf.com)
- Czech PM resigns amid spying and corruption scandal (telegraph.co.uk)
- UPDATE 1-Czech coalition could go on without PM Necas -partner (xe.com)
- UPDATE 2-Czech PM faces showdown as coalition partners waver (xe.com)
- Czech PM Quits in Corruption Scandal Aftermath (novinite.com)
- Czech PM Petr Necas To Resign On Monday (eurasiareview.com)
- Central Europe hit by floods after days of rain (cnsnews.com)
- Central Europe Hit By Flooding (rferl.org)
- Central Europe hit by floods after days of rain (thestate.com)