Hungary Seeks $230 Billion Package for Eastern Europe

Hungary Seeks $230 Billion Package for Eastern Europe

Feb. 27 (Bloomberg) -- Hungarian Prime Minister Ferenc Gyurcsany wants the European Union to arrange a package of as much as 180 billion euros ($230 billion) to help east European economies, banks and companies weather the financial crisis.
A “European Stabilization and Integration Program” would include short-term financing for governments, coordinated restructuring for private debt, the recapitalization of banks and liquidity for companies in as many as 12 countries, Gyurcsany, 47, said in an interview in Budapest yesterday. He will present the plan at a March 1 EU summit in Brussels.
Some Eastern European economies are in meltdown as the global crisis throttles demand for their exports while investment and credit evaporate. Hungary, Ukraine, Latvia, Serbia and Belarus have sought international bailouts. Regional currencies, stocks and bonds plunged as investors fled riskier assets.
Read more...
http://www.bloomberg.com/apps/news?pid=20601087&sid=aMovouCgIclA

Analysis of East Europe bailout
(01:05) Rough Cut Reuters Video

Feb 27 - Analyst Nigel Rendell of RBC Capital Markets in London says more euros will be needed.

Global development banks have launched a 25 billion euro rescue package to prop up banks and businesses in central and Eastern Europe.
In a communique obtained by Reuters, the coordinated plan calls for the World Bank, the European Bank for Reconstruction and Development and the European Investment Bank to provide quick large scale funding to strengthen banks and give insurance firms access to credit.
Details on the banks and countries involved were not immediately available.
The massive expansion of international banks into the former Communist countries of central and Eastern Europe has made the region vulnerable to the credit strains that arose in the U.S.

NOTE: Natural sound; no reporter narration.
SOUNDBITE:
# Analyst Nigel Rendell of RBC Capital Markets in London

Will The Economic Crisis Split East And West In Europe?

Will The Economic Crisis Split East And West In Europe?
Nouriel Roubini, 02.26.09, 12:01 AM EST
The meltdown puts huge pressure on the E.U.'s free-market rules.

(Nouriel Roubini co-wrote this essay with Mary Stokes, Jelena Vukotic and Elisa Parisi-Capone, analysts at Roubini Global Economics.)

The Central and Eastern Europe region is the sick man of emerging markets. While the global crisis means few--if any--bright spots worldwide, the situation in the CEE area is particularly bleak. After almost a decade of outpacing worldwide growth, the region looks set to contract in 2009, with almost every country either in or on the verge of recession.
The once high-flying Baltics--Estonia, Latvia, Lithuania--look headed for double-digit contractions, while countries relatively less affected by the crisis--the Czech Republic, Slovakia and Slovenia--will have a hard time posting even positive growth. Meanwhile, Hungary and Latvia's economies have already deteriorated to the point where International Monetary Fund (IMF) help was needed late last year.
Central and Eastern Europe's ill health is primarily driven by two factors: collapsing exports and the drying up of capital inflows. Exports were key to the region's economic success, accounting for 80% to 90% of gross domestic product in the Czech Republic, Hungary and Slovakia. By far the biggest market for CEE goods is the Eurozone, now in recession.
Meanwhile, the global credit crunch has sapped capital inflows to the region. An easy flow of credit fueled Eastern Europe's boom in recent years, but the good times are gone. According to the Institute of International Finance, net private capital flows to emerging Europe are projected to fall from an estimated $254 billion in 2008 to $30 billion in 2009. Whether this is formally considered a "sudden stop" of capital or not, it will necessitate a very painful adjustment process. Read more...
http://www.forbes.com/2009/02/25/eastern-europe-eu-banks-euro-opinions-columnists_nouriel_roubini.html

EU 200 Miljard Euro herstelplan trapt voornamelijk open deuren in

Het gepresenteerde herstelplan van de Europese Commissie trapt feitelijk alleen open deuren in en roept vooral de vraag op of José Manuel Barroso nog wel de juiste man is om de EU te leiden.
Investeren in: Scholing, Lagere administratieve lasten, Infrastructuur, Energiebesparing en promotie van 'groene producten', evenals het snelle Internet,etc. Het lijkt meer op een lijstje van 10 jaar geleden dan op een herstelplan voor de ergste economische crisis van de 21ste eeuw. Gemiereneuk, ongeïnspireerd en geen spoortje van een grote visie (Grand Vision) en bovendien qua bedrag volstrekt ontoereikend (dat is ook een open deur). Maar als de geldverslindende Brusselse bureaucratie in deze omstandigheden niet met iets beters op de proppen kan komen dan is het wellicht tijd om die hele boel maar versneld af te schrijven, iets wat veel mensen in gedachten allang gedaan hebben.

Europese topconcerns slaan massaal alarm

Topondernemers slaan alarm.(Telegraaf.nl)
AMSTERDAM - Grote multinationals waaronder Shell, Philips en Akzo Nobel maken zich grote zorgen over de in snel tempo om zich heen grijpende economische crisis. ,,We hebben de bedrijvigheid in Europa nog nooit zo snel zien verslechteren als in de afgelopen maanden. De situatie is ronduit gevaarlijk en de Europese landen moeten nu echt ingrijpen”
Dat stellen de bestuursvoorzitters van 47 grote Europese concerns in een gezamenlijke brandbrief richting politiek en Europese Unie, met handtekeningen van bestuurders als Van der Veer (Shell), Kleisterlee (Philips), Wijers (Akzo Nobel), Van Boxmeer (Heineken) en Cescau (Unilever).
Volgens voorzitter Jorma Ollila, ook president-commissaris van Shell en Nokia, is in Europa sprake van een scherpe daling van het aantal nieuwe orders en bestaat er een groot gebrek aan betaalbare kredieten.