Iceland held its referendum on its €3.9bn repayment package to UK and Dutch savers on Saturday last.Icelandic banks collapsed in both countries leaving savers at a loss. Icelanders are seething at the actions of the authorities in those countries. A final turnout of 62.7% cast their vote with 93% rejecting the proposed repayment package.
It looks like the Icelanders do not want to renege on the package but they want the terms of the repayment to be re-negotiated.
A €4.6bn IMF package for the Icelandic economy is on hold until there is certainty about how the foreign savers are to be compensated.
Business, Economics
The President of Iceland has moved against Icelandic parliament in refusing a deal that would see the 
repayment of €3.9bn to UK and Dutch savers in a failed Icelandic bank. This is creating diplomatic tension between the countries involved. President Olafur Ragnar Grimmson was reacting to a petition signed by thousands of Icelanders to refuse payment. The presidents move was a blow to Prime Minister Joanna Sigurdardottir’s government who backed the deal.
The matter will be decided by referendum on February 20th.
Business, Economics
Ireland recorded a Balance of Trade surplus for 2008 of €29bn. This is a 14% increase on the previous year.
Exports fell by 3% while imports fell 10% (led by a collapse in the sales of cars and computers).
Business, Economics
Insurance magnate, Sean Quinn has been knocked back from first to third place in the list of Ireland’s richest people to be replaced by Denis O’Brien, according to latest Rich List from Forbes Magazine.
Forbes estimates that the Quinn family fortune plummeted by some USD4.5 billion in the past 12 months with Mr Quinn losing at least E1.5 billion from his Anglo Irish investments.
Media mogul Anthony O’Reilly has dropped out of the billionaires’ list this year.
Overall, the world’s billionaires are estimated to have lost about one-quarter of their combined wealth last year.
Bill Gates regained his position as the richest person in the world, overtaking investor Warren Buffett, whose personal fortune fell by USD25 billion.
Business, Economics
As the gobal recession bites hard,their is growing suspicion that many governments are edging towards protectionism. The Czech government in its EU presidency is determined to uphold unity and ensure that member states obey the rules of the single market. The G7 states also have pledged to work together in tackling the global crises.
Meanwhile,France’s plan to inject €6.5bn into its car industry (Renault/Peugot/Citroen) has angered the German,Swedish and the Czech Republic governments. Hot on its heels is aid for the Spanish and Italian car makers from their authorities.
President Obama meanwhile has a “Buy American“provision in the stimulus package leaving little doubt as to where his sentiments lie. The U.S has been criticized by Europe,Japan and Australia. The Chinese have also been critical without naming the U.S.
When announcing its 4 trillion yuan stimulus ($586bn) it avoided a “buy local” message.
Business, Economics
The Society of the Irish Motor Industry , the Trade Association representing garages nationwide have reported that January new car sales clocked in at 15,929. This is a 67% decline from January 2008 figures(47,609). This is the most up to date snapshot of the state of the Irish Economy. It indicates the unwillingness of people to update their motors. It has an immediate negative impact on exchequer returns,and will cause unemployment in the garages. The weakness of sterling as against the Euro has seen many people travel north or across the Irish sea to pick up a bargain.
Will the Government introduce a testing system (a la NCT) for all foreign imported cars?
What chance of a re-introduction of a Government backed “scrappage” on old cars?
Business, Economics
As the House of Representatives vote on January 28th on President Obamas intention of an $825bn stimulus to the U.S. economy, economists are unsure as to its likely success in creating jobs and increasing G.D.P. Much depends on the multiplier effect.
Business, Economics
The Irish government,through the National Treasury Management Agency (NTMA) this week closed the successful sale of a 5 year Government bond,securing €6bn at a rate of 4.07%. The sale was oversubscribed, with orders in excess of €7bn. The buyers comprised of asset fund managers and central bankers. It is expected that the Government may have to borrow at least €20bn on the bond market this year. The rate to be paid is higher than most countries (Germany 2.35%, Italy 3.57%) but lower than Greece (4.76%) for their latest 5 year bonds.
The agency were attempting a sale €3bn, but with 140 investors willing to buy,decided to double their target.
Irelands debt to GDP ratio now stands at 41%
Business, Economics
With the € presently at £.95 sterling and the Bank of England stating that zero interest rates in the UK are a possibility,keeping sterling weak, Irish exporters to the UK are in trouble. We export 18% of our goods to our nearest neighbour(€16bn in 2007) while British tourists account for 50% of visitors here.
Its not surprising that Irish shoppers have been taking advantage of the value to be had across the Irish sea and up north. Not alone has the shopper benefitted from the changes in the exchange rates,recent changes in the VAT rates has seen a 6.5% difference emerging between the two jurisdictions. (21.5% in the Republic /15% in the UK).
Do you think we will have parity? (€1=£1)?
Business, Economics
Pictured here is the ICTU voting recently to accept the latest Social Partnership Agreement, “Towards 2016″.
Congress, comprising of 55 unions, voted 305 in favour of the agreement and 36 against.
Congress represents 620,000 workers in the Republic of Ireland.
How likely is it that the pay elements of this deal with be implemented?
Business, Economics
The Organisation of the Petroleum Exporting Countries(Opec) intend cutting oil production immediately in an attempt to halt the slide in prices. It is expected that Russia, the worlds second largest supplier,will work with the cartel
to boost prices.
Opec,which controls 40% of the worlds oil supply have agreed between themselves to cut production by 2m barrels a day,but its believed that some member states have not followed through on this decision. The finger of blame is being pointed at Ecuador,Venezuela,Libya and Iran.
In recent times the price has fallen from $140 a barrel to $46 a barrel at the moment.
With the global downturn it is speculated that next year it could slide toward $30 a barrel.
Business, Economics
Inflation fell to its lowest level in three years in November. The annual rate dropped to 2.5%. Economists predict that next year could see deflation kicking in for the first time in 60 years.
Business, Economics
Iceland held its referendum on its €3.9bn repayment package to UK and Dutch savers on Saturday last.Icelandic banks collapsed in both countries leaving savers at a loss. Icelanders are seething at the actions of the authorities in those countries. A final turnout of 62.7% cast their vote with 93% rejecting the proposed repayment package.
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