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Friday Newspaper Review - Irish Business News and International Stories - - August 15, 2014
By Finfacts Team
Aug 15, 2014 - 11:52 AM

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Irish Independent

JOBS Minister Richard Bruton is under fire after a company which once employed 1,200 people in the same town axed the final 160 staff.

There was devastation in Carrick on Shannon yesterday as MBNA confirmed it was closing its call centre at what was once the biggest employer in Leitrim.

Minister Bruton promised that all the supports of the State would be made available to the workers affected on what was a "sad day" for those losing their job.

Local business people called for a financial services company to be located in the state of the art building with many saying a task force would be a waste of time.

GROWTH in the eurozone stuttered to a halt in the three months to June as Germany's economy contracted and France stagnated.

It comes just days after it was announced Italy, the eurozone's third largest economy, slipped back into recession in the second quarter

In another blow to hopes of a recovery in the 18 nation bloc, GDP remained flat in the second quarter, initially sending stocks lower yesterday. But by mid afternoon European shares had recovered amid heightened speculation that the European Central Bank (ECB) would have to carry out further stimulus to help kick start activity.

Of particular concern was the 0.2pc contraction in Europe's economic powerhouse Germany, which even undercut forecasts from the Bundesbank and came on the back of a fall in inflation and a drop in investor confidence.

IRISH company Providence

The oil and gas exploration firm said the area at Spanish Point South is 140km off the west coast.

Stockbroker Davy said the move highlights the group's efforts to maintain momentum in its Irish offshore programme.

"The 3D survey should provide clarification and detail, particularly around reservoir quality, which is considered to the greatest risk to making a commercial discovery in the area," said analyst Caren Crowley.

All of the four wells drilled in the Spanish Point South area so far have encountered either gas or oil, Providence said.

Providence technical director John O'Sullivan said the survey over the Spanish Point South area is its third in that area since 2009.

Irish Times

Chris Johns: The German economy’s loss of momentum and its 0.2 per cent contraction in the second quarter has hit the headlines.

However, quarterly swings in growth often contain many distortions and, equally often, are subsequently revised.

The world’s largest economy, the US, shrank by an alarming 2.1 per cent in the first three months of the year . A stunning bounce back in the second quarter resulted in 4 per cent growth.

Samsung Electronics is to buy SmartThings, a startup backed by PayPal co-founder Max Levchin that helps connect household devices, one of its largest US start-up acquisitions to date.

The South Korean electronics maker joins fellow technology heavyweights Apple and Google in exploring ways to integrate connected household gadgets such as thermostats and lights with mobile apps, a trend commonly known as “internet of things.”

Samsung did not disclose financials, but the TechCrunch blog reported in July that Samsung was in discussions to pay more than $200 million for the two-year-old startup of 55 employees, which has raised $15.5 million in venture capital from Greylock and Russian investor Yuri Milner, among others.

Denmark’s biggest pension fund, ATP, says a perfect storm of forces including tighter regulation led it to abandon its reliance on the longest-dated bonds. The fund, based north of Copenhagen, said earlier this week it was shortening interest rate guarantees to savers amid a lack of liquid assets with maturities of 30 years and longer. Policy holders will now have the rates paid on their savings guaranteed for 15 years at a time, versus lifelong guarantees. ATP said the change will also help protect pensioners’ purchasing power.

The fund, based north of Copenhagen, said earlier this week it was shortening interest rate guarantees to savers amid a lack of liquid assets with maturities of 30 years and longer. Policy holders will now have the rates paid on their savings guaranteed for 15 years at a time, versus lifelong guarantees. ATP said the change will also help protect pensioners’ purchasing power.

Irish Examiner

Eurozone economic growth ground to a halt in the second quarter as Germany’s economy shrank and France’s stagnated.

The zero growth reported by statistics agency Eurostat yesterday was cause for alarm throughout the 18-nation region, which is already bracing for the impact of sanctions imposed on and by Russia over Ukraine.

Germany, Europe’s largest economy, contracted by 0.2% in the quarter, undercutting Bundesbank forecasts that GDP would be unchanged. Foreign trade and investment were notable weak spots, the German Statistics Office said.

“Today’s figures show that the upturn remains too weak to withstand external shocks” — such as the Russian sanctions — “meaning that GDP growth will probably remain stuck in stop-and-go mode,” said Peter Vanden Houte, chief Eurozone economist at ING.

Europe

Euro Topics: ECB needs even more expansive policy: The ECB will have no option but to buy government bonds on a large scale to forestall another economic slump in the Eurozone, the liberal business paper Financial Times believes: "The ECB will almost certainly at some point be forced into quantitative easing to rescue the real economy - just as it was eventually forced to rescue peripheral sovereign debt. The problem remains resistance among some governments, notably Germany, and the Bundesbank. Mr Draghi has floated the idea of buying asset-backed securities. The faster that conversation reaches the conclusion of full-blown QE the better."

Hectic bailout measures harm EU economies: The fact that the economies of certain European countries shrank in the second quarter is above all due to mistakes at the EU level, the liberal-conservative Swiss daily Neue Zürcher Zeitung believes: "The weak state of many European economies has to do with the fact that the eagerness of many European politicians to introduce bailout and redistribution mechanisms has hindered the recovery of markets and national finances. In this light the negative figures from Germany can help to raise awareness of the tasks that still lie ahead in the EU. Characterised by expansive policy on the part of the ECB and debt-driven national economies, today's Eurozone is marked by a false sense of stability that in many places is all too willingly mistaken for real stability and an adequate basis for continuing with traditional European integration."

Nothing but empty promises from France: France's economy has failed to grow for the second quarter in a row. All the fault of the government's failed policies, the left-liberal daily Le Monde believes: "Every three months the economic indicators contradict the government's robust forecasts. The motor has broken down and, unlike what could have been hoped for just a year ago, the French economy is not being 'pulled along' by the dynamism of its European partners. ... The same causes - lower production and fewer jobs - bring about the same effects - growth is flagging as a result of austerity. These negative figures come as a hard blow for François Hollande and the government of Manuel Valls and undermine their credibility. The responsibility pact was supposed to make the French economy more dynamic and allow it to join in on the European recovery. Neither of these goals has been achieved."


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