Showing posts with label PRIME MINISTER SILVIO BERLUSCONI. Show all posts
Showing posts with label PRIME MINISTER SILVIO BERLUSCONI. Show all posts

Thursday, November 10, 2011

DTN News - EUROPE'S FINANCIAL PAIN BE CHINA'S GAIN: IMF Seeks Clarity In Italy, China Wants Stability

Defense News: DTN News - EUROPE'S FINANCIAL PAIN BE CHINA'S GAIN: IMF Seeks Clarity In Italy, China Wants Stability
(NSI News Source Info) TORONTO, Canada / BEIJING, China - November 10, 2011: The head of the International Monetary Fund urged Italy Thursday to act quickly fill its damaging political vacuum, and China said it was willing to help maintain global financial stability that was being threatened by the euro zone crisis.

IMF Managing Director Christine Lagarde spoke during a visit to China as Rome politicians scrambled to find a replacement for Berlusconi, who has said he will step down when parliament approves reforms aimed at placating markets.

"No one exactly understands who is going to come out as the leader. That confusion is particularly conducive to volatility," Lagarde told a news conference in Beijing.

"So from my perspective, political clarity is conducive to more stability and my objective from the Fund's point of view is better and more stability."

On European markets Thursday, hopes that new government being formed in Italy and Greece could help stave off a euro zone break-up drove the euro higher and top-rated government debt lower, while stocks held above a three-week trough.

China -- which holds an estimated 25 percent of its $3.2 trillion of foreign exchange wealth in euro-denominated assets -- is equally keen to see clarity and stability take hold in the euro zone, the country's single biggest export market.

Premier Wen Jiabao told Lagarde that Europe's sovereign debt crisis was a serious challenge to the world's economic recovery, and had increased financial risks for developed economies, Chinese state media reported.

"China supports the measures taken by the European Union, European Central Bank and IMF to deal with the crisis, and is willing to work with all parties to discuss effective cooperative measures to maintain global financial stability," Xinhua news agency paraphrased Wen as saying.

China remains focused on maintaining its own relatively fast, stable growth, Wen added.

Italian 10-year bond yields eased Thursday from the previous day's record highs, but they continued to trade around 7 percent, a level many economists consider unsustainable for financing sovereign debt of more than 2 trillion euros.

Lagarde, a former French finance minister, declined to comment on a Reuters report that German and French officials have discussed plans for a radical overhaul of the European Union to create a more integrated and potentially smaller euro zone.

YUAN APPRECIATION

She also said she believed Chinese authorities were prepared to let the yuan appreciate further, as demanded by many U.S. and other western politicians who accuse Beijing of holding its currency artificially low to give an unfair advantage to its exporters.

"My understanding is that the authorities are prepared to let that appreciation continue in the months and years to come," she said.

"Certainly from our perspective, with the goal of stability and the solid, balanced and sustainable growth that we pursue, clearly that's welcomed and encouraged."

Lagarde, who also met vice Premier Wang Qishan, said she had in-depth discussions with China's central bank chief Zhou Xiaochuan, a leading advocate of internationalizing the Chinese currency.

But she said it was too early to include it in the IMF's Special Drawing Rights unit, a basket of four currencies -- U.S. dollars, euros, Japanese yen and sterling -- in which the bulk of global trade is designated.

"But there is a clear understanding that it will come in due course and that it will be a factor of the internationalization of the currency. In my view, there is a stronger signal that China is a key player but also an important partner in the composition of this ... easily convertible currency of the IMF," Lagarde said.

(Additional reporting by Sui-Lee Wee, Tracy Zheng and Ben Blanchard; Editing by John Stonestreet)

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SHANGHAI - China's oil refineries ran at lower rates in October, and output from steel mills and power plants also dropped, as a credit freeze bit into demand for industrial

commodities in the world's second-largest economy. | Video














































































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*This article is being posted from Toronto, Canada By DTN News ~ Defense-Technology News

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Wednesday, November 9, 2011

DTN News - ITALY BREAKING NEWS: Italy Faces Limbo After Berlusconi Agrees To Go

Defense News: DTN News - ITALY BREAKING NEWS: Italy Faces Limbo After Berlusconi Agrees To Go
(NSI News Source Info) TORONTO, Canada / ROME, Italy - November 9, 2011: Italy looks set for lengthy political uncertainty after Prime Minister Silvio Berlusconi's pledge to resign, with his center-right party calling for elections and the main opposition for a national unity government.

After failing to secure the majority in a vote in the lower house, Berlusconi said he would quit as soon as parliament passed budget reforms urged by European partners to help Italy stave off a debt crisis that is threatening the euro zone.

"We no longer have the majority we believed we had so we need to recognize this and concern ourselves with what is happening on markets...we need to show markets we are serious," Berlusconi told Italian television by telephone.

Votes to pass the reforms in both houses of parliament are likely this month, and opposition leaders may try to bring this forward in order to end as soon as possible the flamboyant billionaire media tycoon's 17-year dominance of Italy.

Worries about the Berlusconi government's ability to implement reforms to boost Italy's sluggish growth and cut its huge debt have helped fuel a rise in Italy's borrowing costs to unsustainable levels, weighing on the euro and stock markets.

Global equity markets and the euro rose after Berlusconi's decision on hopes that a new leader will act more aggressively to tackle the crisis in the euro zone's third largest economy that is jeopardizing Europe's single currency project.

The 75-year-old prime minister and his party say an election is the only realistic next step but opposition leaders have called for the formation of a national unity.

President Giorgio Napolitano said he would start consultations with all political parties after the new budget measures are approved.

When a government is defeated or resigns, it is the president's duty to appoint a new leader to try to build a majority in parliament, or to call new elections.

Pier Luigi Bersani, leader of the opposition Democratic Party, called for the beginning of a new phase and reiterated the proposal to form a transitional government including representatives from across the political spectrum.

But members of Berlusconi's center-right People of Freedom (PDL) party, whose support would be needed for a broad-based government, said its formation would be difficult.

"All the leaders of the PDL prefer early elections, because it's hard to imagine a government of national unity," Education Minister Mariastella Gelmini told Italian television, pointing to major disagreement among political parties.

Berlusconi and his closest allies have also said that the appointment of a government of technocrats -- an option favored by markets and it is thought Napolitano -- would be an undemocratic "coup" that ignored the 2008 election result that brought the center right to power.

EU Economic and Monetary Affairs Commissioner Olli Rehn said Tuesday that EU inspectors are due to arrive in Rome on Wednesday to begin a monitoring mission aimed at ensuring economic reforms are carried out as part of an agreement reached at a G20 summit last week.

Even when Berlusconi goes, there is no guarantee that reforms will be quickly implemented and relief on markets may not last long.

Yields on Italy's 10-year benchmark bonds rose to 6.74 percent Tuesday, near levels at which Portugal, Greece and Ireland were forced to seek a bailout.

(Editing by Louise Ireland)


*Speaking Image - Creation of DTN News ~ Defense Technology News
*This article is being posted from Toronto, Canada By DTN News ~ Defense-Technology News

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