Harris&Ewing Ninth Street N.W., Washington, DC 1915
Not could, but will.
Tumbling share prices. A sell-off in commodity markets. Capital flight from some of the world’s riskier countries. Hints of a looming currency war. Financial markets ended last week in panic mode as fears emerged that the world was about to enter the next phase of the crisis that began eight years ago in August 2007. Back then, the problems began in the developed world – in American and European banks – and spread to the rest of the world. The bigger emerging markets – China and India most notably – recovered quickly and acted as the locomotive for global growth while the west was struggling. There was talk of how the future would be dominated by the five Brics countries – Brazil, Russia, India, China and South Africa – and by 11 more emerging market economies, including Turkey, Indonesia, Mexico and Nigeria.
That has happened. Emerging market countries are dominating the news – but for all the wrong reasons. And because, after years of rapid growth, they now account for a bigger slice of the global economy, a crisis would have more serious ramifications than in the past. Emerging markets have a habit of causing trouble. For a quarter of a century after the Latin American debt crisis erupted in Mexico in 1982, the story was of a storm moving from the periphery of the global economy towards its core, the advanced nations that make up the G7. Mexico ran into fresh problems in 1994, there was an Asian debt crisis in 1997, and a Russian default in 1998 before the dotcom bubble burst in 2001. That proved to be a dress rehearsal for the near meltdown of the global financial system in 2007-08.
Now the focus is back squarely on emerging markets. The problem is a relatively simple one. In the post-Great Recession world, the tendency has been for all countries to try to export their way out of trouble. But this model works only if the exports can find a home, as they did when China was growing at double-digit rates. But in the past 18 months, the Chinese economy has slowed, causing problems for two distinct groups of emerging-market economies – the east Asian countries that sell components and finished goods to their big neighbour, and countries that supply China with the fuel and raw materials to keep its industrial machine going.
China’s slowdown has led to a slump in the price of oil and industrial metals. In theory, this should have no net effect on the global economy because lower incomes for commodity-producing countries should be offset by the boost to countries that import commodities. It hasn’t quite worked out that way. Consumers in Europe, Japan and North America have not used the windfall from cheaper energy to go on a spending spree. Meanwhile, emerging market economies are hurting badly. With the western economies one new recession away from deflation, China is making its exports cheaper by devaluing its currency just as oil producers are flooding the world with crude in a bid to balance their budgets.
I simply think everything’s worse than what’s reported.
In the aftermath of share falls in the Chinese stock market, there is increased focus on the wider effects. China’s problems are unlikely to have any immediate impact on other equity markets directly, due to its limited integration with international markets and the fact that these markets did not see a sharp parallel rise. The effects on China’s economic activity are the primary concern. These, in turn, may flow through into the global economy, affecting growth, trade, commodity prices, inflation and capital flows. The impact on the real economy has been muted to date. The paper profits of inflated share prices did not have a major effect on consumption. It is incorrect to assume, however, that the fall will have no effects.
Chinese households may increase already high saving rates, reducing consumption and slowing growth. The output of the finance industry contributed about 16% of GDP in the first quarter of 2015. It accounted for 1.3 percentage points of China’s 7% growth in the same period, compared with a contribution of about 0.7 points to the 7.4% growth in 2014. The financial impact may be greater. Given that a significant part of the rise in stock prices was driven by borrowings to purchase shares, the recent falls will reduce the value of collateral. To the extent that investors cannot meet margin calls, lenders may suffer losses. Also affected will be many large shareholders and state-owned enterprises, whose holdings are pledged as collateral for loans. The falls increase the risk of default.
The level of leverage may account for the difficulty in initially arresting the pace of the market falls. The consensus view is that such loans are modest relative to the size of the banks (around 1.5% of total banking assets) and the economy, implying the risk of a major financial crisis is limited. But there are reasons for caution. First, the amounts involved may be much larger than expected. The amount of official margin debt extended by securities companies of $250-300bn may be only a fraction of the real level of stock-secured debt. Once vehicles like umbrella trusts, private lending arrangements and the rest are included, the amount may be 50-100% higher.
Sure, take your time boys. A forecast for 6.8% growth looks silly though.
China’s economic slowdown and a sharp fall in its stock market herald not a crisis but a “necessary” adjustment for the world’s second biggest economy, a senior IMF official said on Saturday. Fresh evidence of easing growth in China hammered global stock markets on Friday, driving Wall Street to its steepest one-day drop in nearly four years. “Monetary policies have been very expansive in recent years and an adjustment is necessary,” said Carlo Cottarelli, an IMF executive director representing countries such as Italy and Greece on its board. “It’s totally premature to speak of a crisis in China,” he told a press conference.
He reiterated an IMF forecast for a 6.8% expansion in the Chinese economy this year, below the 7.4% growth achieved in 2014. “China’s real economy is slowing but it’s perfectly natural that this should happen … What happened in recent days is a shock on financial markets which is natural,” he added. China’s stock markets have fallen more than 30% since mid-year. Following a slew of poor economic data, Beijing devalued the yuan in a surprise move last week. Cottarelli said the IMF would discuss in coming months with Chinese authorities their decision to weaken the currency.
China is eager for the yuan to join the IMF’s Special Drawing Rights basket of currencies. But the fund is considering extending the current SDR basket by nine months until September 30, 2016. Turning to Greece, which is heading to an early election in September, Cottarelli said the IMF would decide in two or three months whether to join the latest international rescue efforts. The IMF deems Greece’s debt unsustainable and has called for debt relief as a condition to participate in a third bailout. “The debt sustainability assessment will take place after the launch of the program (agreed with creditors) in two or three months. The IMF will then be able to evaluate whether to intervene,” he said.
Faith in central banks.
Forget for a moment the “panic” that is happening in U.S. stocks. Forget about the panic in China. Forget about the panic in Apple. As I argued several weeks back and have written about continuously since, the odds simply have been favoring a summer stock-market correction given the behavior of key inter-market relationships outlined in our award-winning papers (click here to download). Something far more important and spectacular may be underway which likely will only be realized and appreciated after the damage is done. The illusion of stock-market stability is fading, and the Last Great Bubble — faith in central banks — may be starting to pop.
Just as everyone is talking about the Fed raising rates in September and “lift off” finally occurring, the global growth and inflation story is dramatically reversing. It turns out quantitative easing did absolutely nothing for the economy, and it turns out that Europe’s own version of QE simply isn’t working to boost reflation hope. For too long, market participants have been sucked into the idea that the S&P 500 is the money market (as I said on CNBC here). Lower for longer has now become an excuse for too long to buy U.S. markets and believe that risk does not exist when central banks “have our backs.”
The narrative may be on the verge of a significant change. At some point, we have to stop endlessly debating the question of “when” the Fed will raise rates. Instead, we must begin to question what is so wrong with the environment that has resulted in them not having raised rates yet. Unquestionably there are long-term structural forces at play which have been disinflationary, but the bigger issue is that the U.S. stock market turned from a discounting mechanism of the future to yet another failed vehicle for stimulus under the guise of the “wealth effect.”
A tad disappointing that Wolf doesn’t link the US bubble to those in Oz, NZ, Canada, which occur for the exact same reasons. It’s a global Anglo development.
Wealthy, very nervous foreigners yanking their money out of their countries while they still can and pouring it into US residential real estate, paying cash, and driving up home prices – that’s the meme. But it’s more than a meme as political and economic risks in key countries surge. And home prices are being driven up. The median price of all types of homes in July, as the National Association of Realtors (NAR) sees it, jumped 5.6% from a year ago to $234,000, now 1.7% above the totally crazy June 2006 peak of the prior bubble that blew up in such splendid manner. But you can’t even buy a toolshed for that in trophy cities like San Francisco, where the median house price has reached $1.3 million. And the role of foreign buyers?
[N]ever have so many Chinese quietly moved so much money out of the country at such a fast pace. Nowhere is that Sino capital flight more prevalent than into the US residential real estate market, where billions are rapidly pouring into the American Dream. From New York to Los Angeles, China’s nouveau riche are going on a housing shopping spree.
So begins RealtyTrac’s current Housing News Report. “For economic and political reasons, Chinese investors want to protect their wealth by diversifying their assets by buying US real estate,” William Yu, an economist at UCLA Anderson Forecast, told RealtyTrac. “The best place for China’s smart money to invest is the United States.” In the 12-month period ending March 2015, buyers from China have for the first time ever surpassed Canadians as the top foreign buyers, plowing $28.6 billion into US homes, at an average price of $831,800, according to the NAR. In dollar terms, Chinese buyers accounted for 27.5% of the $104 billion that foreign buyers spent on US homes. It spawned a whole industry of specialized Chinese-American brokers.
Political and economic instability in China along with the anti-corruption drive have been growing concerns for wealthy Chinese, Yu said. “China’s real estate market has peaked already. Their housing bubble has popped.” So they’re hedging their bets to protect their wealth. And more than their wealth…. “China’s economic elites have one foot out the door, and they are ready to flee en masse if the system really begins to crumble,” explained David Shambaugh at George Washington University. China has capital controls in place to prevent this sort of thing for the average guy. But Yu said there are ways for well-connected Chinese to transfer money to the US, particularly those with business relationships in Hong Kong or Taiwan.
But in the overall and immense US housing market, foreign buying isn’t exactly huge. According to NAR, foreign buyers acquired 209,000 homes over the 12-month period, or 4% of existing home sales. But foreign buyers go for the expensive stuff, and in dollar terms, their purchases amounted to 8% of existing home sales. In most states, offshore money accounts for only 3% or less of total homes sales. But in four states it’s significant: Florida (21%), California (16%), Texas (8%), and Arizona (5%). And in some trophy cities in these states, the percentages are huge.
A bit overblown. The -seeming- instability is part of the democratic process.
Greek political instability has reached alarming levels, with the emergence of a new left-wing party in parliament defying Syriza. A new coalition government of national unity was needed, in order to start implementing the promised bailout reforms. But the call for snap elections by Prime Minister Alexis Tsipras, and then the launch of Popular Unity – a breakaway anti-austerity party led by former energy minister Panagiotis Lafazanis – have fuelled disunity. All reforms will be put on hold for about six weeks. Greece faces a key sequence of events during that time. First, in line with the constitution, the main opposition parties will get a chance to form a new coalition government. The second-strongest party – centre-right New Democracy – is expected to fail.
Then Popular Unity, launched on Friday and already the third-strongest party, will get its chance next week. Popular Unity will fail too, but Mr Lafazanis could wish for no better way to promote his party on the political scene. Second, fresh elections will be held next month in a heated atmosphere. There is the now familiar division between supporters and opponents of the bailout. But on top of that, a new division will grow between Syriza voters still loyal to Mr Tsipras and Syriza voters who will shift their allegiance to Popular Unity. Popular Unity will be entitled to ample space in the Greek media, during the election campaign, to argue that it, not Syriza, is the true anti-austerity party. It will pose as flag-bearer of the anti-austerity movement that swept Syriza to power after mass protests in 2010-2014.
So Popular Unity will try to draw on the pool of disaffected Syriza voters and other Eurosceptic voters on the left. They oppose the additional public sector cuts, sweeping privatisation and restructuring of pensions, required under the bailout. Most likely, the new party will get considerable support from the many voters – 62% of the total – who said “No” to the third bailout, in the 5 July referendum. Soon after that “No” vote Mr Tsipras performed a u-turn, accepting the austerity demands of Greece’s creditors as the price for keeping Greece in the euro. So now Greece is committed to the €86bn bailout from its eurozone partners – the country’s third in five years.
If the elections have no clear winner and Mr Tsipras – until recently leading in opinion polls – cannot form a clear majority government, complicated negotiations will follow. It could be a protracted period, during which potential coalition allies of Syriza jockey for position. So Mr Tsipras’s resignation – in order to call snap elections – has triggered a process of disintegration in Syriza. He may have saved Syriza from a damaging internecine fight between supporters and opponents of the new bailout. But he has also diminished the chances for a quick economic recovery. Economic instability has been compounded by political instability.
Jockeying for position. Kathimerini is hardly the best source for comments on this.
The row between and the rebels that broke away to form their own group on Friday intensified over the weekend as Greece’s parties prepare their candidate lists for the upcoming snap elections. The new leftist party, Popular Unity, comprising 25 breakaway MPs from SYRIZA, took the opportunity to lash out at the government over the weekend. In a statement, the party said the government’s claim to have negotiated with the country’s lenders was a “euphemism” as it led to the country’s third bailout. The party also accused Tsipras’s aides of “confusing the dictatorship of the memorandum with the democratic operation of institutions.” That comment was a reaction to an earlier statement issued by Tsipras’s press office, accusing Parliament Speaker Zoe Constantopoulou of “acting like a dictator” and saying that she was “a wrong choice.”
SYRIZA is expected to start whittling down its list of election candidates this week. The fact that the Popular Unity rebels defected before this process has begun is likely to make Tsipras’s task easier. In January he attempted to maintain the balances between his party’s factions, which is something he no longer needs to do. Also, party sources told Kathimerini that the defections also provide Tsipras with the opportunity to invite candidates of other political persuasions to join the SYRIZA ticket. The party leadership is hoping that a meeting of the SYRIZA central committee this week will lead to an inclusive message being sent out by the leftists as they seek to draw up their lists for the snap elections.
“..a split in the party that our people, the courageous voters who voted No, did not deserve..” Well, I think it was inevitable.
Greece’s pre-election campaign has turned ugly before it has even officially commenced, with senior figures – including the former finance minister Yanis Varoufakis – rounding on the prime minister, Alexis Tsipras, for his governance of the crisis-plagued country. Breaking the wary truce since his surprise resignation the day after Greeks voted to reject austerity in a referendum last month, Varoufakis has lashed out at the leftwing leader’s policy choices, saying in an interview in the New Review that Tsipras had decided “to surrender” to the punitive demands of international creditors keeping Athens afloat. Instead of remaining faithful to the anti-austerity platform on which his radical left Syriza party had been elected, the young prime minister had allowed his ego to get the better of him and made a conscious decision to become the “new De Gaulle, or Mitterrand more likely”.
In the wake of Tsipras’s unexpected move on Thursday to call early elections, Varoufakis said: “Tsipras made a decision on that night of the referendum not only to surrender to the troika but also to implement the terms of surrender on the basis that it is better that a progressive government implement terms of surrender that it despises than leave it to the local stooges of the troika, who would implement the same terms of surrender with enthusiasm.” As a result, Syriza once the hope of Europe’s anti-austerity movement, had not only betrayed the cause but mutated into the very thing it had set out not to be. “This mutation I have already witnessed. Those in our party/government who underwent it, then turned against those who refused to mutate, the result being a split in the party that our people, the courageous voters who voted No, did not deserve,” he wrote.
The criticism is the closest Varoufakis has come to distancing himself from the man he did much to mentor in the nearly six months that he oversaw often fraught negotiations with the eurozone and the IMF. Tsipras’s rash decision to resign and call elections – the third poll to be held in Greece this year – the MP argued, amounted to a concerted effort by the leader to purge the party of dissent. “For it is clear,” he continued, “that once you start implementing policies it becomes untenable to say constantly: ‘I am passing law X through parliament even though I think it is toxic.’ At some point either you resign or you remove the cognitive dissonance by beginning to believe that law X ain’t that bad; perhaps it is what the doctor ordered.”
Don’t think Zoë and Alexis are best friends anymore.
A brewing row between Parliament Speaker Zoe Constantopoulou and the government peaked over the weekend as the former redoubled her verbal attacks against both Prime Minister Alexis Tsipras and President Prokopis Pavlopoulos, prompting a terse reaction from the offices of both. A day after expressing strong objections to the procedure followed by Pavlopoulos in handing exploratory mandates to the conservative opposition following Tsipras’s resignation, Constantopoulou struck again on Saturday, accusing Tsipras and the president of treating Greece’s institutions as “their fiefdom and property.” Constantopoulou hit out at Tsipras for calling elections “on the sly,” claiming that only Greece’s creditors had been briefed about the plan.
She also slammed Pavlopoulos for not informing her before launching the process of issuing exploratory mandates to party leaders. The Constitution dictates that the president informs the parliamentary speaker on the composition of the House before issuing exploratory mandates, she said. Pavlopoulos did not respond publicly to Constantopoulou on Saturday but his office issued a terse statement. “As of yesterday, the presidency is no longer paying attention to Mrs Constantopoulou,” it said. On Friday, sources in Pavlopoulos’s office had countered accusations of an “institutional faux pas” by declaring that the president had “honored the Constitution to the letter.”
Later on Saturday, Tsipras’s office also issued a curt note, indicating that the premier regretted appointing Constantopoulou to Parliament’s top role. “The parliamentary speaker is acting like a dictator,” it said. “She thinks she’s at the institutional center of democracy when she’s just a wrong choice.”
Long and interesting.
As we finish lunch, we talk about his future plans. He’s dismissive of the criminal investigation against him, which he says doesn’t bother him in the slightest. “I think it’s going to fizzle out. However if I’m prosecuted and convicted of high treason, it would be interesting. For what? Saying no to an agreement that the troika itself considers to be unsustainable? Or indeed for having tried to come up with a defensive plan against threats they were making? In a sense, I would very much like it if it came to it because I would be able to expose them for what they are.” As for the idea that he hacked into private tax accounts, he says there’s nothing secret about tax files. “Let’s say I know your tax file number, so what? They would have to come up with a charge that I tried to create reserve accounts for people to put money into them. OK? Guilty.”
He says he’s not going to return to academia for the time being – although if and when he does, you can imagine that he’ll be in a great deal more demand than he was when plying his trade, largely uncelebrated, in Athens, Sydney and Austin. “I’m a member of parliament, let me remind you, and my commitment to my voters was that I’m not going to abandon them, come what may,” he says, sounding for the first time in our conversation like a politician rather than a theoretician. Can he envisage returning to government? “Yes,” he says, straight away. Would he like to? “Depends on the government,” interjects Stratou.
He gives her a look, as if she’s said too much, and then tells me that serving in a government is like becoming head of an academic department: it’s something the appropriate person should only do reluctantly. I don’t believe this. I think Varoufakis is the sort of political animal who, having tasted power, will not be content to return to the sidelines. He has economic theories that he’s determined to prove will work in practice. It’s that determination, of course, that his critics say was his undoing, but it’s also what made him stand out in a grey and uniform world of political conformity.
[..] A couple of weeks later, Tsipras makes his surprise move and resigns in preparation for a new election and, he hopes, a new mandate. He and Varoufakis have maintained a wary truce, occasionally offering implied or mildly explicit criticisms but on the whole steering clear of an outright conflict. But the election manoeuvre seemed to break the bond of loyalty and mutual constraint. In an email to me two days ago, Varoufakis wrote: “Tsipras made a decision on that night, of the referendum, not only to surrender to the troika but also to implement the terms of surrender on the basis that it is better that a progressive government implement terms of surrender that it despises than leave it to the local stooges of the troika who would implement the same terms of surrender with enthusiasm.”
For Varoufakis it would have been better to “retreat to opposition” than go along with the terms because they will force the party to “mutate” into the very thing it set out not to be. “For it is clear,” he continued, “that once you start implementing policies it becomes untenable to say constantly, ‘I am passing Law X through parliament even though I think it is toxic.’ At some point either you resign or you remove the cognitive dissonance by beginning to believe that Law X ain’t that bad; perhaps it is what the doctor ordered.’ This mutation I have already witnessed. Those in our party/government who underwent it, then turned against those who refused to mutate, the result being a split in the party that our people, the courageous voters who voted NO, did not deserve.”
Far as I can see, Corbyn’s PQE is far from perfect, but it’s hardly ‘extreme left”. Corbyn would de very wise to consult Steve Keen, one of the signees, on his Modern Debt Jubilee.
More than 40 leading economists, including a former adviser to the Bank of England, have made public their support for Jeremy Corbyn’s policies, dismissing claims that they are extreme, in a major boost to the leftwinger’s campaign to be leader. The intervention comes as the Corbyn campaign reveals that a Labour government led by the MP for Islington North would reserve the right to renationalise Royal Bank of Scotland and other public assets, “with either no compensation or with any undervaluation deducted from any compensation for renationalisation” if they are sold at a knockdown price over the next five years.
The leftwinger’s economic policies – dubbed Corbynomics – have come under sustained attack in recent days, including by members of his own party, with Andy Burnham warning his party in an interview with this paper not to forget the lessons of the general election about the importance of economic credibility. But with just under three weeks until Ed Miliband’s replacement is announced, Corbyn’s credibility receives a welcome endorsement as 41 economists make public a letter defending his positions. In the letter to which David Blanchflower, a former member of the Bank of England’s monetary policy committee is a signatory, the economists write: “The accusation is widely made that Jeremy Corbyn and his supporters have moved to the extreme left on economic policy. But this is not supported by the candidate’s statements or policies. His opposition to austerity is actually mainstream economics, even backed by the conservative IMF. He aims to boost growth and prosperity.”
Corbyn remains the frontrunner to be Labour leader, but as his policies, and the risks he poses to the unity of the Labour party, have come under scrutiny, rivals believe he is losing momentum. Burnham’s campaign shared data with the Observer that suggested some of those who had previously committed to voting for Corbyn were now recognising the dangers and either opting for the shadow health secretary or describing themselves as “don’t knows”. But writing in the Observer, Corbyn defended his platform and said the government’s “free market dogma” had to be fought and vowed that a Labour government under his leadership would re-empower the state. The chancellor, George Osborne, intends to sell off £31bn of public assets in 2015-16.
Corbyn writes: “Parliament can feel like living in a time warp at the best of times, but this government is not just replaying 2010, but taking us back to 1979: ideologically committed to rolling back the state, attacking workers’ rights and trade union protection, selling off public assets, and extending the sell off to social housing. “This agenda militates against everything the Chancellor says he wants to achieve. If you want to revive manufacturing and rebalance the economy, you need a strategic state leading the way.”
What is this, a wordgame? They’re still “Hundreds of migrants [..], but many of them refugees from the Syrian war and other conflicts in the Middle East..”
Hundreds of migrants crossed unhindered from Greece into Macedonia on Sunday after overwhelmed security forces appeared to abandon a bid to stem their flow through the Balkans to western Europe following days of chaos and confrontation. Riot police remained, but did little to slow the passage of a steady stream of migrants, many of them refugees from the Syrian war and other conflicts in the Middle East, a Reuters reporter at the scene said. Macedonia had declared a state of emergency on Thursday and sealed its southern frontier to migrants pouring in at a rate of 2,000 per day en route to Serbia then Hungary and the Europe Union’s borderless Schengen zone.
That led to desperate scenes at the border, as men, women and children slept under open skies with little access to food or water. Saying they would ration access, riot police used tear gas and stun grenades to drive back crowds, but were overwhelmed on Saturday by several thousand who tore through police lines or ran through nearby empty fields. The state eventually laid on extra trains, and buses arrived from across the country to take the migrants swiftly north to Serbia and the next step of a long journey from the Middle East, Africa and Asia.
“I watched the news on TV and I was astonished,” said Abdullah Bilal, 41, from the devastated Syrian city of Aleppo. “I thought I would face the same when I arrive here. But it was very peaceful. The Macedonian police told us ‘Welcome to Macedonia; trains and buses are waiting for you.'” Mohannad Albayati, 35, from Damascus, traveling with his wife, two children and three brothers, said: “I passed one step but it is a long road to my destination. With Allah’s help I will go to Germany.”
Wait a minute! Reuters starts calling them refugees!
Thousands of migrants stormed across Macedonia’s border on Saturday, overwhelming security forces who threw stun grenades and lashed out with batons before apparently abandoning a bid to stem their flow through the Balkans to western Europe. Some had spent days in the open with little or no food or water after Macedonia on Thursday declared a state of emergency and sealed its borders to migrants, many of them refugees from war in Syria and other conflicts in the Middle East. But by nightfall on Saturday, thousands had crossed the frontier, milling around the border town of Gevgelija where busses had converged from all over the country and trains left in quick succession to take them north to the next leg of their journey through Serbia.
There was no official word from the government, but the level of organisation suggested authorities had opted to move the migrants on as quickly as possibly, having tried and failed to keep them out with razor wire, teargas and stun grenades. “The government is organising additional trains. I don’t know who is organising the busses,” said Alexandra Krause, a senior protection officer with the United Nations refugee agency, UNHCR. No-man’s land, where men, women and children had slept in squalor under open skies appeared largely empty, though more people are certain make their way from Greece.
“In this Europe, animals are sleeping in beds and we sleep in the rain,” said 23-year-old Syrian woman Fatima Hamido on entering Macedonia. “I was freezing for four days in the rain, with nothing to eat.” Thirty-two-year-old Saeed from Syria said of the blocked border: “We know this was not Macedonia and the Macedonian police. This was the European Union. Please tell Brussels we are coming, no matter what.”
And now we’re back to ‘migrants’?!
The Italian navy rescued 3,000 migrants aboard more than a dozen boats in the Mediterranean on Saturday after receiving requests for help from 22 vessels, the coast guard said. Operations are continuing and it is still unclear where the people will be taken, a spokesman said. Europe is struggling to cope with record influx of refugees as migrants flee war in Middle Eastern countries such as Syria. The Mediterranean has become the world’s most deadly crossing point for migrants. More than 2,300 people have died this year in attempts to reach Europe by boat, according to the International Organisation for Migration. On Saturday, thousands of rain-soaked migrants stormed across Macedonia’s border as police lobbed stun grenades and beat them with batons, seeking to enforce a decree to stem their flow through the Balkans to western Europe.
Far too late.
President Prokopis Pavlopoulos has proposed that a EU leaders’ summit be called to discuss a mounting migrant and refugee crisis and called for a closer cooperation with the United Nations. In comments during a meeting on Saturday with Health Minister Panayiotis Kouroublis, Pavlopoulos said a burgeoning migration crisis “is not only a security issue but also a humanitarian concern.” The scale of the problem means it must be tackled jointly, the president said. “There must be a common European policy,” he said, noting that this was “an obligation of the EU and its institutions.” He called for an EU leaders’ summit to be called without delay and with the involvement of the UN refugee agency. Kouroublis, for his part, said the migration crisis “threatens to drown us as a country and we must exhaust all efforts at the European level so that they realize this is not just a Greek issue.”