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Monday Newspaper Review - Irish Business News and International Stories - - October 13, 2014
By Finfacts Team
Oct 13, 2014 - 10:02 AM

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Irish Independent

Householders across the board will receive reductions in their water bills, as concern heightens within the Coalition over the prospect of a public backlash to the charges.

A two-pronged approach agreed by senior ministers will see the introduction of new tax relief measures and financial subsidies in tomorrow's Budget, the Irish Independent can reveal.

The Coalition plans to provide relief through both the tax and social welfare systems in a move that is intended to cover every household in the country.

The proposals, which were signed off by the government's Economic Management Council (EMC), will see householders receive a tax refund worth up to €100 from their water charges bill.

Euro zone banks have raised 35pc more capital ahead of the European Central Bank's (ECB) latest stress test than they had set aside before the 2011 review, according to a report published by law firm Linklaters.

The euro zone's 130 most important banks are set to find out on Oct. 26 how they have fared in the ECB's landmark review, which is designed to banish lingering doubts about whether lenders value assets properly and are strong enough to withstand another recession.

Linklaters said the euro zone banks have raised €35bn ahead of the review, a figure that could rise to nearly €50bn by the end of the year.

Reuters' own research showed the euro zone's 20 listed banks had increased equity by 4pc, or €26bn, in the first half of this year and had put a similar amount into loan loss provisions.

Finland dropped out of the small group of euro nations with a full set of top credit ratings on Friday as Standard & Poor's cut it to 'AA+' from 'AAA', citing persistent economic growth problems.

Finland has yet to return to its 2008 economic output levels after exports dwindled due to the euro zone crisis, problems at its mobile phone and paper industries and the crisis over Ukraine.

The S&P cut leaves Germany and Luxembourg as the only euro states with a full set of top-grade ratings from all three main rating agencies.

Finland's "downgrade reflects our view of the risk that the Finnish economy could experience protracted stagnation because of its aging population and shrinking workforce, weakening external demand, loss of global market share... and relatively rigid labour market," S&P said in its report. It gave a stable outlook for the new rating.

Irish Times

The way in which we formulate and implement fiscal policy is not fit for purpose. The run-up to each budget has become a lobbyist’s paradise; political grandstanding dominates parliamentary debate, vested interests shout louder and louder, making more and more outlandish claims.

Decisions over taxes and spending have become pure power grabs.

When the troika held the whip hand Jean-Claude Trichet raised our taxes and cut our spending to save the European banking system.

As some of that power has seeped back to Dublin, the transition has elicited another form of instability: narrow sectional interests flex their muscles for the first time in what seems an age.

Students attending Dublin City University (DCU) or University College Cork (UCC) have a much higher chance of graduating with a first class honours degree than other college-goers, new figures show in a fresh indicator of “grade inflation”.

Over the past 10 years, 17.7 per cent of graduates at DCU and UCC each received a 1st, compared to 12.8 per cent at Maynooth University and just 11.9 per cent at University College Dublin (UCD).

This is despite the fact that entry requirements for courses at DCU and UCC are generally either the same or lower, indicating no marked difference in the quality of student.

The US case in which Microsoft is fighting a request to hand over emails from a data centre in Dublin, could have serious implications for Ireland if the tech giant loses, said Microsoft’s general counsel Brad Smith.

“We are concerned if we lose this case, governments will demand that data centres are constructed in their countries to store the data of their citizens. That would be bad for the IT sector in Ireland,” he said.

Irish Examiner

German Finance Minister Wolfgang Schäuble said Germany’s response to a "clear weakening" of the economy would be a shift in public spending toward investments and away from government consumption.

Schäuble said the government would lower its growth forecast for Europe’s biggest economy this week and cited sanctions imposed on Russia, geopolitical uncertainty, weaker growth in the rest of Europe and a loss of confidence as reasons. He spoke to reporters yesterday after finance chiefs gathered in Washington for the annual meetings of the International Monetary Fund and the World Bank.

“It’s clear, and that is the response of the federal government, that we will have to increase our efforts for more investments in the public and private sector,” Schäuble said.

Europe

Euro Topics: Nobel Committee also deserves prize: The Nobel Committee deserves praise for diligently rewarding authors who are barely known beyond their country's borders, as was again the case with Modiano, the conservative daily The Times writes: "The academy has done exactly what it should be doing: honouring literary excellence without regard to national and linguistic boundaries. ... His Nobel prize is not only a due recognition but a service to the literary public outside his homeland. ... Yet for all its occasional idiosyncrasies, no institution does more than the Nobel prize to invest the concept of 'world literature' with real substance. Some laureates, such as Aleksandr Solzhenitsyn (1970) and Gao Xingjian (2000), have suffered censorship at home. The Nobel awards spread great writing far beyond the confines of national borders and oppressive governments."

Renzi absolute ruler of Italy: The Italian Senate approved Italian Prime Minister Matteo Renzi's labour market reform on Wednesday night. This vote of confidence gives Renzi absolute rule, the liberal daily La Stampa scoffs: "In Italy there is only one party now, and it's not a left-wing one. It may call itself the PD [Renzi's social democratic Partito Democratico] but it is a modern version of the Democrazia Cristiana, the Christian Democracy party. The messiah from Florence has broken all the taboos that paralysed his communist and social democratic predecessors for decades: he's not afraid of enemies on the left and he's not afraid to take on the trade unions. But above all he has no qualms about fishing in the domain of the enchanter of Arcore [where Berlusconi celebrated his bunga bunga parties]. ... In the era of one-party rule that has just begun the 'Anti-Renzi' can only emerge from the new generation of the PD itself. Renzi knows this and that's why he won't let his sons get beyond infancy. But sooner or later one of them will manage to survive and finish him off."

Gauck too uncritical at reunification ceremony: A ceremony was held on Thursday to mark the anniversary of the first big Monday demonstration in Leipzig 25 years ago, in which over 70,000 people protested peacefully against the government of the German Democratic Republic. German President Joachim Gauck should have focussed more on the problems after German reunification in his speech, news portal Zeit Online comments: "He downplays these problems as the difficulties East Germans had adjusting in a country where for the first time people had to take on responsibility for themselves and show initiative. ... He must know that it was the East Germans whose families were torn apart because their sons and daughters had to go after jobs elsewhere. That the East Germans were and still are exposed to a capitalism in which salaries are often too low to live on. Reunification is Gauck's big story of successful freedom. And it is so well put together and presented that it bears no contradiction. For example with the fact that half of the supposedly democracy-loving inhabitants of Saxony didn't vote in the state parliament election recently."


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