SCRUM in under 10 minutes
Baltic Airlines at a crossroad
3 countries, roughly 7 million inhabitants, and 3 “domestic” airlines. Is this a case to say “In the end there can be only one?”
Estonian Air has recently had its share of problems with canceled flights, destinations and laying off staff. Air Baltic has seen support from SAS fade, and has now been forced to buy out the remaining shares that belonged to SAS. And flyLAL is in serious trouble at home, as the Vilnius airport threatens to stop providing services to the domestic airline for failiure to pay the due fees since August 2008.
Is 2009 the year where Air Baltic will finally dominate the Baltic airlines? I for one do not welcome our new “low-cost” overlords, and wish that Estonian-Air has some fighting power. In the end my heart is with Estonian air, but my mind says that 3 airlines for such a small market is too much, and someone has to give.
Some recent articles on the airlines:
TBT Dec 24
AirBaltic buys out remaining SAS owned shares
RIGA- Management of airBaltic has decided to buy out the remaning shares of the company held by SAS.SAS currently holds 47.2 percent while the Latvian government holds 52 percent.
"Even in this difficult economic climate, the management believes in the company’s future and has decided to buy the shares which currently belong to SAS AB,“ said Bertolt Flick, president of airBaltic.
Once the deal is completed on Jan 31 2009, airBaltic will be completely owned by the state of Latvia. AirBaltic will however continue to work together with SAS on commercial flights as before.
AirBaltic’s fleet is made up of 28 aircraft including ten Boeing 737.
TBC Dec 23
TBC Dec 29After the state of Lithuania decided not to purchase a 51-% holding of flyLAL – Lithuanian airlines for 1 litas, the airline company announced about the reduction of flights.As of January 6 2009, planes will not fly to Istanbul and the number of weekly flights to Frankfurt will be reduced. flyLAL will perform flights to this city on Mondays, Wednesdays, Fridays and Sundays, informs ELTA.
As of January 7, the company cancels flights to Paris. Starting with January 8, clients will be able to fly to Milan only on Saturdays. The company cancels flights to Rome from January 12. The company stated that the winter flights schedule was corrected due to the decreased flows of passengers.
flyLAL CEO Vytautas Kaikaris said that the company respected the decision of the ministry and understood that it was not easy to adopt it.
As of January 1, 2009, Vilnius Airport is planning to discontinue offering its services to the Lithuanian airline flyLAL, according to the airport’s press secretary.The press secretary pointed out for ELTA that the airport has fulfilled all of its obligations towards the airline, and that the airline has not paid its fees for using the airport’s services since August.
The airline has also been collecting airport taxes from passengers and not handing these taxes back to the airport.
flyLAL owes Vilnius Airport more than LTL 20 million (LVL 4.08 million).
If the airline continues to not carry out it obligations, the airport will discontinue offering its services to flyLAL from January 1.
As reported, Latvian Transport Minister Ainars Slesers (Latvia’s First Party/Latvia’s Way) predicted that the Lithuanian airline will go bankrupt sometime this winter.
In Estonia - waiting for the crisis to hit
So the New Year is fast approaching, but you look around and you don’t see anyone with a smile on their face (ok, they are Estonians, but still). You get a sense of apprehension on everyone’s faces. As if 2009 has already started with the wrong foot, and there’s not much you can do about it. The coming year will be bad, it is already bad and it hasn’t even started yet!
Most people fear a devaluation of the Kroon. An unlikely scenario, given the recent Latvian bailout, that promises to keep a dying currency stable. Most people have their loans in Euros and get their salaries in Kroons, a devaluation would be quite frankly a big burden on most Estonian families.
At the same time everyone is looking at Latvia, the Baltic neighbor whose worries are far bigger than the Estonian ones. At least that’s what everyone seems to think. In the time of high GDP growth everyone was competing for a higher percentage, even though everyone was already at double digit growth. They (the Baltic nations) all stood so proud, like the best students in the class, competing with each other for the title of Baltic Tiger. Each was quicker than the other to talk about their “success” and why they had such a high GDP growth. They claimed it on productivity, innovation, education, competitiveness, tax incentives for investors, salary growth and low unemployment. Everything seamed to be the work of a g ood government. Now, the crisis has settled in and the same governments that were so quick to point out their country’s virtues (and indeed their own) are even quicker to point out to the outside for blame. Indeed for them the crisis is not at all their fault, it is the “Global turmoil” that we live in, or the US housing boom. The media didn’t help, fueled by nationalistic pride, few were those in the region that dared to call for a cool down and a down to earth approach to the GDP growth.
Of course there’s much to be said about the global crisis and how it affected the Baltic Economies, specially since they are dependent on foreign demand and investment. Latvia’s main trade partners are Germany and Russia, who were both badly hit by the crisis (Russia may soon find itself in a renewed crisis if the oil prices keep going down). But for Estonia the main trade partners are Finland and Sweden (a factor that reflects this little nation’s more Nordic connections) and thus far both these countries have been able to weather the storm.
Either way, the outlook is not good, and I hate myopic politicians and the people who vote for them.
I wrote a short paper on why the peripheral economies of the (then 15) EU had different fates, Ireland and Finland prospered, while Greece and Portugal failed. In it I mentioned that Geography plays a role in economics too, but I probably forget to mention that the nation’s culture, the way it faces working also plays a role.
Take a look at the Estonian Statistics Office data for Labor productivity and compare the data for all 3 Baltic nations. The data is until 2007. At the same time that the productivity was growing by marginal amounts, labor costs were increasing. This was mainly caused by demographic pressures. Namely the fact that no one is having kids in the Baltic states, and that after they all joined the EU, money was coming in, while talent was going out. Leaving the unqualified people here with more money to earned while not producing much more. A pretty good recipe for failure.
Now Latvia is getting a whole lot of money from the EU, the IMF, Sweden, Estonia (but not Russia), and what is needed is a competent government capable using this money wisely.
Bellow are some of the comments from a recent article on the Economist “The Baltic Brink” It’s certainly worth reading
One comment says:
“Latvian Minister of Finances, Mr. Atis Slakteris, has acquired a degree in mechanisation at the Agricultural University of Latvia in year 1980.
His interview to Bloomberg TV chanel a couple of weeks ago clearly demonstrated his "enormous” competence in finances, as well as his “superb” English skills.
There should be no illusions anymore about competence of Mr. Slakteris (and, actually, the same can be easily referred to a number of other members of the Government).
It is questionable whether a bunch of totally uncompetent and uneducated ministers will be able to lead the country through the crisis successfully.“
You can see the video interview of the Latvian minister of Finance to Bloomberg. Every country has its share of incompetent politicians, but in a time of crisis you’d expect the best to stand up and do something. I really wonder how the Latvian people feel about having such a clueless politician running their money…
Another comment:
"The Prime Minister disqualifies himself from job by failing to tackle corruption. There’s no use trying to repair a broken country if the nuts and bolts of legislature and the executive are rotten. A corrupt country will not benefit from the loan, because funds will be channelled from productive uses to lining the pockets of the crooks that, alas, we ourselves have elected. Investors will remain scared of doing business in Latvia where bribes and kickback are the norm.
He privately admits not only that the incompetence of some ministers (notably the Minister of Finance) verges on mental disability, but also that others (notably the Minister of Transport) are crooked in a way that would make Silvio Berlusconi proud. Publicly, he’s praising everyone. Yet, trying to save the coalition is short-sighted and counter-productive in the longer term.
What the Prime Minister should do is use the public outrage at where the successive crooked governments have left us, and let the anti-corruption authority do its job by putting a dozen or so of the most notorious kleptocrats behind bars. Only then his economic salvation plan will stand a chance of success.”
And yet a very insightful remark:
“But the issue at stake here is a different one and it has to do with the financial and economic situation in Latvia.
An elusive culture of closure, diffidence and complacency is apparent in Latvia for anyone who has the opportunity to relate with latvian people on a different approach than mere touristic purposes.
This much trumpeted "Latvian Pride” has more to do with nationalistic symbols, local celebrations and ancient tales than with a constructive, civilized and committed respect of civic values and public interest.
Nowhere else in the world I have noticed such a manic, compulsive greed for branded clothes and flashy cars as in Latvia. “Bagehot” would have defined ineluctable the “invisible hand” guiding Latvians at the dawn of free market when buying (fake and outdated) branded italian clothes in Riga at 2 or even 3 times their real price.
One of the highest political figures in Latvia earlier this year declared to be “The Godfather” is favourite book.
It strikes me how, at any social and cultural level, so many latvians are irresistibly attracted to the myth (sic) of italian mafia stories and characters.
Latvian politicians just resemble very much the fabric of latvian society. I am aware of the triviality of this observation, but in Latvia I found it excptionally applicable. In other countries people do complain about government shortcomings because of the effects on society at large.
In latvia it seem that people complain because they are excluded from the institutional posts that would allow to enrich themselves.
I don’t ever recall wealthy business people (well connected to the establishment) in Latvia being afraid or concerned about the economic situation.
I have met some very responsible, efficient and honest civil servants in latvia, but they were almost ashamed of their own rectitude as surrounded by crooks and incompetent people. The Constitutional Court of the republic of Latvia is a surprising exception of reliability and one of the few solid institutional harbours within the latvian apparatus, but generally speaking, many of the civil servants chairing important departments and government offices in Latvia wouldn’t be employable even in Uganda as street cleaners.
With reference to the “imported” presidents, Vaira Veika Freiberga (sorry for mispelling) has given Latvia not just the prestige of the primate of a woman appointed as Head of State, but even a widespread positive opinion about her activity during those difficult years chairing such a young independent state towards European membership.
I guess many Latvians have been missing so far her decency, elegance and sense of balance.
On a very light tone, I notice how this prestigious magazine did not take exception signing the article.
It would have been at least inconvenient for The Economist to deal with an imprisonment request of the correspondent by the Latvian security police.
Less Dolce & Gabbana, Mercedes, Sex and the City, mafia movies and more openness towards foreigners, russians residents (involuntary leftover of russian attempted etnic cleansing), would be for sure a good recipe for a more stable future.
Financial and economic wiseness has a lot to do with people’s culture (not to be strictly intended as eagerness to attend ballets and opera events).“
Another comment:
"The truth is that all Eastern Europe is in a very bad shape. There are virtually no exceptions. And the pattern is everywhere about the same - overheating economies with huge current account deficits, real wages growth outpacing productivity growth by a wide margin. The latest theory I read trying to explain the situation is a combination of demographic and economic factors. Eastern Europe is at the forefront of the demographic meltdown facing the West. The working age population is already shrinking in many places which makes these economies more prone to overheating and overreaching their short term production capacity.
This trend was exacerbated in recent years by the integration into the EU which produced two movements in the opposite directions - foreign capital in, local labor out. Many regional economies were progressively thrown off balance and inflated by these flows until the global crisis has arrived and sent them to the bottom.”
One funny thing, is that someone tried to post translated versions of the comments in the Latvian website delfi.lv and the comments were deleted!
City hit by ‘legal to pee’ prank
People should ignore signs telling them that it is legal to urinate in
certain public places in Nottingham, the city council said.
The signs, which were put up by pranksters in and around Nottingham,
are designed to look official.
They feature a toilet sign and include the words: “Public Urination
Permitted After 7.30pm”.
Nottingham City Council is now urging the public to ignore the notices
as it sets about removing them.
‘Cleaned daily’
The prank also featured a laminated note, headed with the logo of
Nottingham City Council, which said the scheme was aimed at reducing
the mess faced by residents outside their homes.
A spokeswoman for the authority said: “It is an offence to urinate in
public and these signs have been put up illegally, for whatever
reason.
"We would urge people to ignore them, otherwise they could find
themselves inadvertently facing a prosecution.
"We are taking the signs down as quickly as possible and if anyone
spots one of the illegal signs we ask them to please contact the city
council so they can be removed.”
The notice reads: “In an attempt to reduce late night public nuisance,
during the holiday period, Nottingham City Council has designated
several public urination areas across the city.
"This urination area will be cleaned daily between the hours of 5am and 6am.”
http://news.bbc.co.uk/2/hi/uk_news/england/nottinghamshire/7798194.stm
Will the rest of the EU have to ratify the Lisbon treaty again?
On the close of the French presidency of the EU, there were news that the Irish would vote again on the Lisbon Treaty. The Irish were given guarantees that their demands would be met. Namely the fact that they would get to keep their commissioner.
Now the question is simple. The Irish are voting again on the Lisbon treaty, so are they voting again on the same treaty or are they voting on a new, different and improved treaty? Daniel Hannan of the Telegraph asks this very same question. If they are voting on the same treaty, then why are they voting at all? They already stated their opinion. If on the other hand they are voting on a different treaty, will the rest of the EU have to ratify a new treaty. Since the one they signed in Lisbon has now been changed to accommodate the demands of the Irish…?
Good question…
Ireland and the EU - book review
BOOK REVIEW : Ireland and the European Union By Brigid Laffan and Jane O'Mahony Palgrave Macmillan 303pp, £22.99
‘MY ONLY counsel to Ireland is that in order to become deeply Irish, she must become European.“
- Tom Kettle, 1910.
Kettle’s apparently paradoxical advice goes to the heart of Ireland’s troubled relationship with the EU. Our debates on Lisbon and Nice have been underpinned by the simple assumptions that, as we become more European, we must inevitably, progressively lose our Irish identity; or that, as we increasingly engage with our partners and share decisions with them, we inevitably dilute our "national” sovereignty.
It is the logic of the zero-sum game that denies the real truth about the EU, that the whole can be, is, greater than the sum of its parts, that in combining with others we create new possibilities of sovereignty, real new abilities to shape the course of events that are continental in scope.
As we pause for breath ahead of what now appears to be an inevitable second Lisbon referendum, Brigid Laffan and Jane O'Mahony provide a welcome opportunity to step back and take the long view of the content and complexity of that relationship. Not least because the much-discussed complexity of the Lisbon Treaty is a function not so much of the intentional obscurantism of drafters, as some would have us believe, but precisely of the complexity of that relationship, whether at institutional or political level.
The evolution of the institutional architecture of the EU over the years, broadening with new members as integration and the acquisition of new competences continued apace, has created a living organism that is difficult to describe or comprehend. Ironically, that may be largely because, unlike a classic bureaucracy, the union’s institutional structures are permeated through and through with points of contact and leverage for representatives of member states, from ministers to MEPs, from officials and diplomats to county councillors, interest groups and social partners. The purpose is to create a system of checks and balances that aspires to accountability. In practice, of course, this imperfect democratic aspiration comes at the price of transparency.
The authors draw the balance sheet of Ireland’s engagement with the European Economic Community (EEC), then the EU, with great lucidity and authority, from preaccession as a peripheral basket case through, as emerging star pupil, to the simultaneous crises engendered by the demise of the Celtic Tiger and rejection of Lisbon. Above all, it is an account of the interweaving of the narratives of modernisation and the transformation of Ireland in the last three decades and of the Europeanisation of our politics, economy and institutions.
The authors not only answer the “What did the Romans ever do for us?” question - in terms of cash and the shaping of the liberal economy, of the protection of agriculture, of a transforming social and environmental policy agenda, of the evolution of our foreign policy and our relations with Britain, and of the EU’s contribution to peace in the North, to mention a few - but provide a detailed analysis of how Ireland and its representatives have engaged strategically and institutionally with the union to shape policy.
Can a small, peripheral country without much economic or any military clout avoid being marginalised and avoid ending up being dragged along in the wake of others? The answer is yes in the authors’ important final chapter, which explores both the Brussels realpolitik of coalition and consensus building and the State’s related strategic approach to institutional and treaty reform.
The emphasis in the latter is not driven by any ideological federalising agenda, whatever Anthony Coughlan and others might suggest, but by a pragmatic assessment of the way changes may affect the evolving balance of forces between large and small states and between competing European institutions.
Ireland’s approach to treaty reform, not least the unwieldy Lisbon compromise treaty, reflects that experience, and the treaty must be seen in that broader light of the real dynamics of this State’s experience. In charting and exploring that, Laffan and O'Mahony have made an invaluable contribution to the ongoing debate.
• Patrick Smyth is Foreign Editor of The Irish Times
Polish Sausage: The E.U. Fails On New Kyoto Effort
Former U.S. Vice President Al Gore speaks at the U.N. climate change talks in Poznan, Poland. Representatives from nearly 190 countries met to work out a new climate change plan to replace the Kyoto Protocol.
Europe was supposed to be the Great White Hope for the environmental alarmists, the only credible balancing force against the irresponsible and crass capitalism of the U.S. which refused to ratify the Kyoto Protocol on carbon emissions. But the results of the recent E.U. Climate Summit in Poznan, Poland showed that hope to be misplaced.
In July the U.N.’s IPCC chair, Rajendra Pachauri, called on the E.U. to “show the way” to the rest of the world. If the E.U. did not do so, Pachauri said, “all attempts to manage the problem of climate change will collapse.” The meeting in Poland was supposed to translate the E.U.’s ambitious target of 20 percent cuts in carbon emissions by 2020 (compared with 1990 levels) into hard-nosed legally binding agreements. In the end, the E.U. leadership approved a document full of escape clauses.
While E.U. leaders said the deal was “an example for the world”, environmental groups deemed it a betrayal of the E.U.’s efforts to fight climate change. The World Wildlife Fund, among others, called upon the E.U. Parliament to refuse major parts of the deal. They especially demanded the rejection of the raft of exemptions from the cap-and-trade scheme. The E.U. Parliament wasn’t listening. It duly ratified the deal.
Denying that the deal significantly watered down pre-conference goals, E.U. leaders now hope they have done enough to convince the U.S., India, China, and others to follow suit. But even a cursory review reveals the claims don’t stack up.
The deal commits Europe to cutting carbon dioxide emissions by varying national reduction targets throughout the 27 member states. The cap-and-trade scheme, which presently issues free carbon credits to industry, will require industries and power stations to buy their permits beginning in 2013. But to achieve a consensus, the E.U. attendees were forced to agree to all sorts of exemptions. Chief among them was bowing to German pressure to exempt most heavy industries from paying for permits. An exodus of heavy industry from German soil had persuaded Chancellor Angela Merkel to make this request non-negotiable. Poland, with 94 percent of its industry dependent on coal-fired power stations, along with other eastern European countries, demanded large discounts. They got them. So what about other European industries who feel so threatened by the deal they may leave for foreign, “less stringent” emission refuges? No problem. The fail-safe for them is written in too. All they have to do to gain exemption is threaten to leave European soil.
Most critical of all is a revision clause – insisted upon by the Italians – which makes the new E.U. climate deal entirely conditional on a consensus agreement being reached at next year’s Copenhagen conference. Failure there – and it is hard to see any consensus – would simply lead to more watering down of European commitments.
Writing recently in the Wall Street Journal, Benny Peiser, professor at John Moores University in Liverpool and editor of the international science policy network, CCNet, says “The E.U. climate deal was diluted beyond recognition.” Of the 20 percent emissions cut targeted for 2020, Peiser states, “The actual reductions might be as trivial as 4 percent if all the exemptions are factored in.” Colin Butfield of the WWF put it succinctly “E.U. politicians may be hoping to trumpet the deal on climate change as a great success, but in reality this is a significant failure.”
Another critic, George Monbiot, the environmental columnist for Britain’s Guardian newspaper, wrote that the new agreement is “a disaster.” He goes on saying that the “20 percent carbon cut they promise by 2020 falls miles short of what’s needed, and they’ll be able to buy most of it from abroad anyway. All this means, in a world which has to eliminate most of its carbon pollution, is that other countries, which have sold their easiest reductions to us, will then find it harder to make emissions cuts of their own. It’s carbon colonialism, in which Europe picks the low-hanging fruit in developing countries, leaving them with much tougher choices later on.”
Carbon emissions rose in Europe last year. And few of the Kyoto signatories have succeeded in reducing their carbon dioxide emissions over the past decade, even before the global economic crisis took a hand. The downturn caused a complete collapse in the price of carbon credits and now threatens the viability of future E.U. Emission Trading Schemes.
The writing was on the wall in the months running up to the E.U. Summit. By the time the conference opened, European states, especially Germany, Italy, Poland and eastern European states, were lining up, carbon dioxide “sicknotes” in hand, to renegotiate their targets. That’s not surprising. In October, Germany and Italy, Europe’s leading manufacturers, declared that any cap-and-trade measures should not “weigh on the economy.” Italy estimates the cost of complying with its imposed target will be about $32 billion a year. New research concludes that Germany could lose around 300,000 jobs by 2020. German industrialists have openly called for a moratorium on the climate package.
Poland and at least eight other eastern European countries with coal-dependent power stations have long lobbied against forced emissions cuts. Even some last-minute carrot dangling by France, offering the prospect of millions of Euros of free carbon emission allowances (halving their emission allowance quota until 2016) failed to head off the fears of the eastern European nations. France and Austria, too, asked the E.U. to ease their national targets burden.
The E.U. and the U.N. are both eager to achieve emissions reductions agreements. Both see a global energy-climate consensus as pivotal to a planet-saving enterprise orchestrated and led by them. But any consensus on carbon cuts is being threatened by the renaissance of coal. The U.K. is considering building six new coal-fired power stations. And while Brussels may prefer that Russia, Poland, the U.K., Germany and the others leave their coal in the ground, the need for European energy diversity and the E.U.’s push for more (carbon dioxide-neutral) nuclear power is working against it. Some 40 coal-fired plants are planned across Europe over the next five years with 27 planned for Germany alone.
Meanwhile, China is bringing online one coal-fired power plant a week. India is industrialising using coal-fired power. The World Bank has been investing in coal projects around the world during the last year. Clean or otherwise, King Coal is set to continue punching massive holes in global carbon emission targets. In a market where carbon prices have already collapsed, just imagine the scale of the carbon taxes for which these burgeoning state industries would be liable if a Kyoto model was adopted. All of which puts the E.U.’s paltry carbon cutting efforts in perspective.
For Kyoto-style accords to succeed, carbon emission targets must be binding and deals meaningful – and if not in an ideologically committed Europe then where? No wonder the E.U. and U.N. fear their over-weaning political ambitions through global carbon governance may, literally, be going up in smoke.
Oh those crazy Belgians…
And here we are again… Belgium, the heart of Europe, as they so proudly proclaim when you enter Brussels International Airport, suffered another setback.
The political crisis that has been going on for at least one year now continues on, and this time the King accepted the resignation of Yves Leterme.
The problem now was not only political, but there were allegations of interference from the government in the rescue of the Belgian bank Fortis.
I’ve always regarded the Belgians as being good at compromise, good at negotiations and at coming to agreements. Making sure that every one at the table got a fair deal. That is the way most of us (Europeans) saw them, and were happy that most of the European decisions were made in Brussels. But this has been going on for too long now, it does nothing to benefit the image of Belgium abroad, in fact it does taint it in my opinion. On the other hand, everyday life continues, the Belgians got used to life without a government and the whole country did not stop as some were quick to predict.
Still, recent moves by radicals to try to break-up the country in two have left foreign residents baffled with this issue. And if the EU wants to have any success in getting peace and stability in the whole Balkan region, it must address it’s own division struggles and deal with these issues. The EU as a project of unity can not live with a divided Belgium.
For a good review on the whole political crisis in Belgium, head to wikipedia’s article on the issue.