How olive oil explains Greece’s problems

The hills of Kalamata, on the southern coast of Greece's Peloponnese peninsula, produce some of the best olives in the world. When pressed, they produce an oil that is almost fluorescent green and sometimes described as "liquid gold."

EPA/ALI ALI

But after much of that oil is pressed in Greek processing facilities, tanker trucks come to take it straight to the sea. In 2012, 60 percent of Greece's olive oil output was shipped to Italy. There, it is packaged in Italian bottles with Italian labels, and then sent around the world. And most of the profits go back to Italy -- according to consultancy McKinsey, Italy captures an extra 50 percent premium on the price of Greek oil.

Are Germans Really Poorer Than Spaniards, Italians And Greeks?

 A recent ECB household-wealth survey was interpreted by the media as evidence that poor Germans shouldn’t have to pay for southern Europe. This column takes a look at the numbers. Whilst it’s true that median German households are poor compared to their southern European counterparts, Germany itself is wealthy. Importantly, this wealth is very unequally distributed, but the issue of unequal distribution doesn’t feature much in the press. The debate in Germany creates an inaccurate perception among less wealthy Germans that transfers are unfair.

 

Italian Unemployment Just Hit a New Record

By Jordan Weissmann

That guy has nowhere to be, I promise.

Photo by Ezra Shaw/Getty Images

It’s been a while, thankfully, since the eurozone was in full-blown meltdown mode. But there’s still plenty of slow-burning economic misery in the common currency area.

Left and right wing terrorism in Italy in the 1970’s: Lessons for Greece.

Italy for almost 15 years faced the menace of both far-right and far-left terrorism. From the late 1960’s to the early 1980’s the lethal face of terrorism brought chaos to the Italian state and intimidated society. To speak of what the 1970s represented in Italy’s political history is probably to speak of the present in Greece; the political situation that preceded those years in Italy bears resemblance to the situation that Greece faces today.

Left and right wing terrorism in Italy in the 1970’s: Lessons for Greece.

Italy for almost 15 years faced the menace of both far-right and far-left terrorism. From the late 1960’s to the early 1980’s the lethal face of terrorism brought chaos to the Italian state and intimidated society. To speak of what the 1970s represented in Italy’s political history is probably to speak of the present in Greece; the political situation that preceded those years in Italy bears resemblance to the situation that Greece faces today.

Germany accuses Italy of pushing illegals north

“Italy pays immigrants to go to Germany,” headlines Linkiesta quoting an accusation by the Hamburg immigration office. The city’s authorities say they have arrested around 300 African immigrants holding expired temporary permits issued in Italy and demand they are removed. The immigrants said they were explicitly told by Italian officials to head to Germany, the destination of choice for most immigrants arriving in the EU through Mediterranean country, and were given up to €500 if they agreed.

Bank of Italy Warns 65 Per Cent of Families Have Insufficient Income

Biggest difficulties faced by households headed by unskilled workers or the unemployed

As many as 65% of Italian households reckon that their income does not cover their needs. The warning comes in two separate studies from the Bank of Italy, which also point out that the proportion of households with insufficient income to meet consumption is on the rise. Two issues of the bank’s Quaderni di Economia e Finanza paint a stark portrait of the situation faced by Italian households in the wake of the credit crunch. The studies highlight “clear signals of the difficulties faced by households in saving their desired quantity of resources”. The proportion of income households think they can actually save fell to historically low levels of around 30% in the mid 2000s, as against 50% in the early 1990s. The biggest increase in families reporting insufficient income was among those living in rented accommodation with an unskilled, unemployed, retired or part-time worker as the head of household.

Two cheers for Beppe Grillo

The Achilles heel of the euro has always been democracy. Although the euro is unlikely to break up, that risk cannot be entirely excluded: one day, voters may choose a government committed to policies that are incompatible with the conditions set by Europe’s leaders for membership of the single currency. 
Democracy in the eurozone suffers from a structural problem and a policy problem. The structural problem is that the new rules agreed since the euro crisis began – including the ‘six pack’, the ‘two pack’ and the fiscal compact – have deprived national parliaments of the freedom to set the budgets which they believe are best for their country. The European Commission and other eurozone governments can now order a national government to revise its budget.

Italian president snubs German candidate over "clown" comment

By Holger Hansen and Stephen Brown

Italian President Giorgio Napolitano canceled a dinner with the German opposition's chancellor candidate on Wednesday after he described Italian former premier Silvio Berlusconi and comic-turned-politician Beppe Grillo as "clowns".

Why Italy Has the Most Reason to Quit the Euro

 Peter Coy

Italy, not Greece, is the country that has the strongest case for leaving the euro, says a new report from Bank of America Merrill Lynch. The report lands as former Prime Minister Silvio Berlusconi—who is skeptical of the euro—positions himself to campaign for a return to the premiership. “We are all asking him to run, and I believe in the end, he will decide to lead the party,” People of Liberty Secretary General Angelino Alfano told Sky TG24 television on July 11.

European Press about the Italian elections

Martirena

The narrow victory of the centre-left coalition in elections on February 24 and 25 has left the country without a clear majority. The European press wonders about the implications of the vote and considers the consequences for Europe.

Spain reacts: "What is good for Italy is good for Spain,"

Spanish Economy Minister Luis de Guindos said Tuesday the risk of political stalemate in Italy after an inconclusive vote had shaken markets, but that this effect would only be "short term".

"What is good for Italy is good for Spain," the minister told a news conference, while adding that he was "convinced" that the "political will" to lead Europe out of the crisis "will prevail".

World From Berlin: Italy's 'Childlike Refusal to Acknowledge Reality'

The Italian election, in which more than half of voters backed two comedians in the form of Silvio Berlusconi and Beppe Grillo, shows Italians are unable or unwilling to grasp the depth of their economic plight, argue German media commentators. The ungovernable nation poses a major risk to the euro zone.

Italy's Monti expected to resign as MPs debate budget

Mario Monti is expected to resign as Italian prime minister shortly, keeping a promise to step down as soon as his budget is passed by parliament.

MPs are debating the 2013 budget drawn up by his government and may approve it before the end of Friday.

Mr Monti is due to give a news conference on Sunday, at which he may announce whether he will stand in forthcoming parliamentary elections.

He was brought in to form a technocratic government last year.

Silvio Berlusconi’s return: Why policymakers across Europe fear it

Let it never be said that Silvio Berlusconi isn’t resilient.

Italian Premier Mario Monti announced over the weekend that he’s resigning early because former prime minister Berlusconi’s party, the People of Freedom, pulled its support for his policies. The same day, Berlusconi announced he is running for the premiership again. 

Former Italian prime minister Silvio Berlusconi. Axel Schmidt/dapd

Though he’s hinted at a comeback previously, this time Berlusconi said he had a “responsibility” to run, even though he and his party hit record-low popularity ratings of 31 percent last year as he was leaving office, and his poll numbers have nearly halved since then.

Italy’s Monti to call it quits after Berlusconi withdrew support; waiting to pass budget law

Premier Mario Monti told the Italian president Saturday he plans to resign following the sudden loss of support from Silvio Berlusconi’s party, paving the way for early elections a year after the economist helped pull the country back from the brink of financial disaster.

Only hours earlier, Berlusconi announced he would run again for premier, aiming for a comeback just a year after he quit in disgrace under the pressure of financial markets as Italy teetered toward the brink of financial disaster.

Corriere della Sera: EU Puts Italy in Dock for Earthquake Aid

Investigation will probe Italian laws granting assistance for earthquakes since 1990

The European Commission has opened an “in-depth investigation” into reductions of taxes and contributions granted by Italy to companies based in areas affected by natural disasters. The Commission circulated a press release to express fears that aid may “go beyond the actual damage suffered”. Investigators will be examining the laws that granted generous aid in the wake of the natural disasters that struck Italy between 1990 and 2011, from the 1990 earthquake in Sicily to 2009’s earthquake in Abruzzo.

Corruption Is Seen as a Drain on Italy’s South

Italy’s A3 highway, begun in the 1960s and still not finished, starts outside Naples in the ancient hill town of Salerno and ends, rather unceremoniously, 300 miles farther south as a local street in downtown Reggio Calabria.

Along the way, it frequently narrows to two lanes, with an obstacle course of construction sites that have lingered for decades. Perilous, two-lane bridges span mountain ravines high above the sea, while unlit tunnels leak in the rain — and occasionally drop concrete and other building materials onto passing cars.

Italy Sells 3-Year Debt at Lowest Yield in Almost 2 Years

Italy sold three-year debt at the lowest rate in almost two years a day after Germany's top constitutional court paved the way for the European Central Bank and the European Union to buy bonds of nations in distress.

The Rome-based Treasury sold 4 billion euros ($5.2 billion) of its benchmark three-year bond to yield 2.75 percent, down from 4.65 percent at the last auction of the same securities on July 13. That was the lowest Italy paid on three-year debt since October 2010, according to Bloomberg data. Investors bid for 1.49 times the amount offered, down from 1.73 times on July 13.

"The short end of the Italian curve will continue to look appealing for those who believe the ECB will embark on some heavy purchases," Annalisa Piazza, a fixed-income analyst at Newedge Group in London, said in a note before the sale.