By Hermes Solomon
GREECE will hold a snap general election on January 25, throwing the country into a new period of political turmoil just as it ‘emerges’ from economic crisis.
In my Sunday Mail article of two weeks ago (DIKO orchestrated chaos…) I predicted: ‘Greece leaves the Eurozone and Cyprus follows as repeated general strikes hand over seats of power to the far left – in our case, 94-year-old, Dr Vassos Lyssarides assisted by 84-year-old, George Vassiliou!’
Well, the old men bit of the prediction was undoubtedly satirical, whereas Greece leaving the Eurozone after handing over power to SYRIZA (Synaspismos tis Rizospastikis Aristeras – Coalition of the Radical Left) seems increasingly likely.
If SYRIZA is elected, it would be the first time an anti-bailout party, determined to overturn the austerity approach prescribed since the start of the Eurozone Crisis, comes to power in Europe.
“With the will of our people, in a few days, bailouts tied to austerity will be a thing of the past,” SYRIZA leader, Alexis Tsipras said after last Monday’s vote. “The future has already begun.”
European Central Bank quantitative easing to stimulate growth as EU economies strive to keep their heads above water while watching Greece drown, will not dissuade Greeks [and others] from voting for radical change.
What good is QE to Greece with its 260 billion euro bail-out, when Cyprus only requires 11 billion (plus the two and half we owe to Russia), and at one eleventh the size and population of Greece sinking as fast.
This past six months, the euro has fallen in value against the dollar by ten per cent and against the pound by five per cent. A one euro one dollar exchange rate is no longer unrealistic.
Agreed, dollar purchased oil prices are sitting at a five year low thus the fall in the value of the euro can, to some extent, be offset by cheaper oil, which means cheaper production costs and cheaper goods. But if there is no money in our pockets to purchase the goods, EU stagflation is inevitable.
Cyprus might well follow Greece in leaving the Eurozone as the percentage of Non-Performing Loans rises unstoppably, making our banks unviable; with NPLs touching 50 per cent, massive write offs are unavoidable.
Do ask Harris Georgiades why a SYRIZA-led Greece will not affect Cyprus? Similar ‘talk’ predicting Cyprus escaping Greek financial mayhem was spouted in 2009 by the then AKEL government’s minister of finance, ‘Kikling’ Kazamias!
President Anastassiades seeking political party consensus is an admission he’s holding ‘a busted flush’ after 22 months in office. His New Year Speech to the nation was a take on the Chinese president, Xi Jin Ping’s, “There will be no let up to the crackdown on corruption in public life in 2015. No one – neither politicians nor VIPs – will be spared.” How could any such crackdown avoid implicating Nik and his cronies? And then who will rule the country?
Contradictory statistics abound as the Central Bank of Cyprus claims that bank deposits rose to 45.8 billion euros in November or 4.4 per cent compared to a year before, yet the population in the government controlled areas decreased by almost 1.0 percent last year according to the statistical services’ demographic report for 2013 – rats abandoning a sinking ship?
The Cyprus Tourism Organisation has said it was doing everything possible to restrain the downward trend displayed by the Russian market – the island’s second biggest after the UK – but did not tell us what the doing was.
And just why is the government only now looking into allowing SMEs to pay overdue VAT and social insurance through instalments, although ‘the justice dept. will not suspend prosecutions across the board’ affirmed our Minister of Justice, Ionas Nicholaou? Isn’t that rather like herding all ‘cattle’, including foreclosures on first homeowner NPLs, into the same abattoir?
What with government unsubstantiated promises of ‘massive’ investment to come from foreign investors this February, leading to a ‘miraculous’ economic upturn, have we yet to accept that promises are only made to temporarily calm public disquiet?
Please note that while our politicians have been ‘messing around’, the Turkish stock market index (XU 100) has grown by 30 per cent in 2014 and ours (CSE) declined by the same amount. Shareholders know – they predict the likely outcome of any economy. It is they our government should take note of, not sheiks in Qatar or maharajas in India, fund managers on Wall Street or European bankers, who will, after exploiting what’s left of Cyprus, export ‘profits’ to tax havens.
Turkey is the closest and richest neighbour of Cyprus and we refuse to even talk to her, Barbaros or not. Must we wait until we’re starving before doing lots of business with Turkey like Greece is now doing?
We are all whores when it comes to filling our stomachs. Brussels, the ECB and the IMF are the cause of our hunger as they grow fatter on increased taxation/austerity of the masses hopelessly struggling on ever dwindling incomes!
Unemployed and taxed into financial oblivion – with the important food and welfare infrastructure reduced to mocking bribery – you only have to talk to any intelligent impoverished Athenian shopkeeper or Mani olive-grower to grasp that they already have nothing.
Berlin and Brussels will ‘crush’ SYRIZA. But as the man said, “People with nothing left have nothing to lose”.
And that’s what the majority of Cypriots will be saying by the end of 2015…