Chinese economy receives a package of stimulus program

China is about to infuse a multi-billion dollar financial package in order to maintain growth and insulate its economy against global slowdown. Among the top priorities are building of new roads, airports and hydropower stations, subsidizing purchases (on energy saving products) and reviving cash-for-clunkers programs (to boost up sales in the automobile sector). The fresh boost of investment is estimated to be around $150 billion or more.

China's economic stimulus program has barely received any formal acknowledgement; although, Chinese premier has agreed “new emphasis on growth.” The Prime Minister of China has also stressed on the importance to develop strategic emerging sectors, particularly when the economy is feeling downward pressure.

It is reported that China has sanctioned 868 new projects in the first four months of this year, followed by another 100 projects in the month of May alone. This is a remarkable shift from recession hit economies as both the investment and the consumption incentives are totally backed by the state. As of now, Chinese planners are treading cautiously, watching the impact of economic stimulus on Chinese economy.

Syrian diplomats get marching order over Houla massacre

In a united move, as many as 12 western nations including the United States have taken the decision to expel Syrian diplomats from their countries. This is in response to the Houla massacre last week that left over hundred villagers dead in Syria. The victims of the attack were mostly women and children. Shabiha militia, paramilitary group of Bashar Al-Assad government are thought to be behind the gruesome attack.

The gruesome killing which continued for two days, Friday and Saturday, at the Taldu village in Syria has drawn International attention as images of mutilated bodies of children circulated. Even long time ally, Russia, has condemned the killings of civilians and has called for independent investigation under the supervision of United Nations in Syria. Germany, Italy, France, Britain, Spain, Canada and the United States are some of the western countries that have decided to close out Syrian diplomats.

President Bashar Al-Assad of Syria blamed outsiders for the bloodshed, while Kofi Annan, the United Nations-Arab League envoy put the onus on the Syrian President to end the bloodshed and follow the peace plan.

While Britain has given three Syrian diplomats a week’s notice to pack off to Syria, the United States has given Syrian diplomat, Zouheir Jabbour, 72 hours.

It is of the general opinion that without armed intervention, diplomatic pressure and tough talk would make little headway with the Assad government. However, the White House has ruled out military action as it may lead to more violence and killings.

Day second Presidential poll begins in Egypt

The Presidential poll in Egypt enters its second day as the country gears up to choose their first ever democratically elected President. Voting is expected to start at 8 AM (local time). For ordinary Egyptians, the two days of voting is a life-changing moment as they get to choose their own civilian President (through voting) for the first time in the country’s history. The current military council has assured of a fair election and a civilian government.

In the two days of first and free presidential election, fifty million eligible voters would decide their favorite candidate out of 12. Running among the top are Md. Mursi (Muslim Brotherhood-led Freedom and Justice Party), Ahmad Shafiq (briefly held the post of Prime Minister during Mubarak regime in Feb 2011), Amr Moussa (Arab League) and Abdul Moneim Aboul Fotouh (independent Islamist).

Preliminary results are expected to come in on Sunday. In case President is not selected, a run-off vote is going to be held on 16 and 17 June.

The last 15 months of post-Hosni Mubarak era has been marked by violent protests and power struggle. This has cast a major blow to FDI (foreign direct investment). Tourism, one of the major sources of income, has also reduced to one-third. Egypt’s President-to-be has a major challenge ahead to live up to people's expectations.

Suicide bomblast snuffed out 90 young Yemeni soldiers

A suicide bomber believed to be in military uniform blew himself off on Monday in the capital Saana killing nearly 90 soldiers and injuring 300. The soldiers were rehearsing for Tuesday’s National Unity Day celebration in Al-Sabeen square near the presidential palace. One of the Al-Qaida arms in Yemen has reportedly claimed responsibility for the attack. The injured soldiers have been admitted to hospitals. There is no report of civilian casualty.

It is believed that Yemen’s Defence Minister, Major General Md. Naseer Ahmed, was the target of the attack. He was at the site when the bomb blast took place; fortunately, he left unharmed.  It is not yet known whether the parade would take place as scheduled.

Security has been beefed up all over Yemen following attack. Newly-elected Yemeni President, Abd Rabbo Hadi Mansour, has assured tougher actions against terrorists. The United Nations Security Council (UNSC) has also condemned the attack and has vowed to clamp down on “all forms of terrorism”.

It is to be noted that since coming to power in February, President Hadi has been trying to clean up his country. The army has launched several offensives in order to root out militant groups, especially from the lawless southern and eastern provinces.

G8 Summit ended with pledge to support growth and Greece

The four day G8 Summit closed out at Camp Davis on Saturday with world leaders coming down in support of growth and saving Greece from the current financial crisis. At the same time, the leaders of the world put the onus on their European counterparts to deal with the financial turmoil before it starts hurting the rest of the world economy.

British PM David Cameron called for “decisive action” and “contingency plan” to combat and tackle the eurozone crisis. He also delicately prodded that the European Central Bank (ECB) should consider printing notes to revive demand in the single currency block.

US President Barack Obama, the host of the Camp Davis Summit, called upon the leaders of France, Germany and Italy to resolve the crisis through restoring public finances and encouraging stimulus. Keeping an eye on his re-election chances, President Obama proposed “stimulus” for job-creating infrastructures, and balancing it with “reforms” in order to address debts and deficits.

Lastly, in order to address the political and economic upheaval in Greece, the leaders of the G8 nations also reaffirmed their interest in keeping Greece within the euro zone. Though, they didn’t propose any solution to tackle the turmoil in Greece.

Obama joins French President Hollande to back growth

While welcoming G8 leaders at Camp Davis on Friday, President Obama has hoped that the world leaders would find a solution to eurozone crisis that would be a pragmatic mix of “fiscal consolidation” and “strong growth agenda”. He also stressed upon the importance of Europe and its strong hold on American economy and the need to put Europe back on the growth path. With Europe already bracing for possible Greek exit, Obama’s take on “growth” is expected to divide the house into two and set the ball rolling for more heated debates.

It seems that French President Francois Hollande’s pro-growth policies have found an echo in his American counterpart, Barack Obama. In aligning with growth, Obama is believed to have distanced himself from Angela Merkel-backed austerity program.

Obama’s view reflects the growing fear of eurozone financial crisis and its cascading effects on other parts of the world. This has the potential to hurt the slowly recovering US economy also Obama’s re-election chance. It is believed that  the four day Camp David summit would be the ultimate testing ground for international diplomats not only to iron out their differences, but also to find a viable solution to euro zone crisis that has threatened to plague the entire financial world.

IMF Chief Lagarde cautions against Greek exit fallout

Following Greek President Carolos Papoulias's decision to nominate a judge as the head of the interim government, the chief of International Monetary Fund (IMF) until the upcoming election, Christine Lagarde, called on prominent Greek leaders to show their commitment to stay with the euro zone on Wednesday. She stressed on the importance of sticking to the bailout agreement – not just for Greece’s own financial and political security but also for the entire euro zone. She also pointed out the possible consequences of such exit – which would be “hard and expensive, and not just for Greece”. Greece is set for a repeat general election on June 17.

What is adding to the fear and speculation in Europe is the rising popularity of political parties in Greece who are against European Union-IMF bailout deal. In the event that an anti-bailout party comes to power following the election, there is a chance that the bail-out deal might come apart and Greece would exit from euro zone.  There is also a fear of its cascading effect on other bigger but vulnerable economies in Europe, especially Spain and Italy.

Top EU officials have already warned Greece that complying with the terms of the bailout package is mandatory in order to receive international monetary aid.

Greece seeks re-election as coalition talks turn unproductive

The latest coalition talk in Athens ended without success as President Carolos Papoulias failed to persuade front-line political leaders to back technocrat government. The idea of technocrat government was proposed by the President himself after mainstream political parties in Greece failed to come up with a unity government. For Greece, this means it has to brace for repeat general election, which is going to further drain its economy, or face bankruptcy.

The Evangelos Venizelos-led Socialist Pasok party blamed the negative outcome of the meeting on arrogant, petty party politics and opportunism. On the other hand, the leader of the Syriza party, Alexis Tsipras, emboldened by his party’s success in the latest general election, stated on a high note that he resisted any move to support the pro-bailout deal in every possible way he could.

Earlier, eurozone leaders, gathered for financial ministers’ meeting in Brussels, have rubbished Greece’s exit from euro as propaganda. However, they have acknowledged preparing contingency plans. The EU leaders have clearly stressed that unless Athens fully agrees with the bailout reform plan, they are not going to receive International monetary aid.

President Papoulias puts forward technocrat government for Greece

In a desperate bid to end the week-long political impasse and make sure that Greece does not lose out on International bailout package, President Carolos Papoulias has suggested the formation of a government of technocrats on Monday. The idea was floated before the leaders of Greece’s three main political parties – the Socialist Pasok, the radical left Syriza and the Conservative New Democracy party, as they failed to form a unity government.

The proposal, though, brought forth a lukewarm response across front-line political leaders, a meeting has been scheduled for Tuesday afternoon (2 PM local time) to chew on it.

While the New Democracy leader Antonis Samaras gave his assurance to help build a government, the chief of Democratic left, Fotis Kouvelis, is totally against the idea of a technocrat government. The chief of Pasok party, Evangelos Venizelos, has termed the Tuesday’s meeting as the last attempt to save Greece “out of a dead end.” On the other hand, although  Syriza party chief Alexis Tsipras is set to attend Tuesday’s meeting, his party has made it abundantly clear that they would not support any move to back austerity. Buzz is that, the 37-year-old dashing Syriza leader wants Greece to either pull out of the bailout agreement altogether or renegotiate the deal.

Hopes dashed as Greece failed to form unity government

Despite President Carolos Papoulias’ repeated attempts to save Greece from further chaos, the front-line party heads have failed to form coalition government. This has happened as a result of the failure of the political parties to reach a consensus on the controversial Greece bail-out deal.

The meeting held at the Presidential mansion on Sunday was attended by three of the most prominent Greek leaders. They were the conservative leader Antonis Samaras, the extreme leftist Syriza chief Alexis Tsipras and the socialist Pasok leader Evangelos Venizelos.

The talk which was aimed at ironing out differences between major political parties on fiscal pact, soon reached an impasse as leaders started blaming each other on the highly controversial bailout agreement and stiff spending cuts. While, the 37-year old Alexis Tsipras riding high on ‘anti-austerity wave’ clearly and completely rejected any negotiations with pro-bailout leaders, Conservative leader Antonis Samaras accused Tsipras for the current standoff. It has also been reported that Tsipras has given the assurance of pulling out of the bail-out deal without giving up Euro.

As per the latest news, the President of Greece is expected to hold another round of fresh talks with the political parties on Monday. Though only a slim chance remains, but if Greece succeeds to form a new government before the Thursday deadline, it might be able to avoid a repeat election and, perhaps, stay in the euro zone.

Greece fiscal crisis deepens amidst growing political chaos

Greece crisis has, perhaps, reached its highest peak as Alexis Tsipras, the newly elected head of the Syriza party (radical left), picked ‘growth’ over ‘austerity’ and ruled out coalition with the two main parties that suffered heavy defeat on Sunday’s election for adopting tight fiscal control. These two are the Socialists party and the conservative New Democracy party. This has prompted EU to mount pressure on Greece – either follow the bail-out terms or face expulsion from the exclusive circle of Eurozone. As the possibility of total economic collapse is intensifying in Greece, there is a growing fear that this would have a snow-balling effect on other debt-hit economies in the Eurozone, further endangering the ‘Euro.'

On Tuesday, the newly elected Syriza party leader, Alexis Tsipras, has asked for temporary stopping on the repayment of Greece debt. He has also expressed his desire to do away with austerity measures that are drawing criticism for the country’s economic collapse.

Germany is the biggest contributor of financial aid to Athens and has ruled out any scope for renegotiation. Germany has stated that for aid to flow, conditions of the bail out have to be met by Athens. As of now, a bill proposing a new spending cut is expected to go before the parliament next month. In exchange, Greece would receive international aid amounting to €11.5 billion in installment; otherwise, it faces default on its staggering €200 billion total debt.

Violence marred Egypt before Presidential Election

Deadly violence erupted as unidentified mob armed with handmade explosives and guns attacked a peaceful demonstration outside the Defense Ministry in Cairo early Wednesday. At least 11 are reported to be dead and not less than 100 sustained injuries of various levels. The Presidential election in Egypt is set to begin on May 23.

The protesters were staging a demonstration against Egypt’s military government for barring a popular Islamic candidate, Hazem Abu Ismail, from running for President. An ex-lawyer cum current preacher, Abu Ismail’s candidature is said to be disqualified on the ground that his mother held American passport, which Ismail has denied. Egypt's electoral law requires Presidential candidates as well as their parents and spouses to hold only Egyptian citizen.

What appalled people the most on Wednesday’s attack was the role of Egyptian military. It is claimed that lives could have been saved if there had been prompt military intervention. Later, the tense atmosphere prompted several candidates to call off their election campaign. Though the situation came under control by noon, Wednesday’s violence is said to be the latest attempt by the military to cling on to power by delaying the transition of power to civilian government.