1 IMF may pull out of Greek rescue (Helena Smith in
The Guardian) Hopes of an end to the impasse between Greece and its creditors
have appeared to evaporate after a surprise intervention from the International
Monetary Fund.
In a letter - leaked three days before eurozone
finance ministers are scheduled to discuss how best to put the crisis-plagued
country back on its feet – IMF chief Christine Lagarde issued her most explicit
warning yet: either foreign lenders agree to restructure Greece’s runaway debt
or the Washington-based organisation will pull out of rescue plans altogether.
Six years have elapsed since Greece, revealing a
deficit that was four times higher than previously thought, received its first
loans from a bailout programme that has since exceeded more than €240bn in
emergency funding. Since a third €86bn bailout last summer, talks have been
largely deadlocked.
The IMF managing director’s intervention came after
the surprise decision of the leftist-led government in Athens to put unpopular
pension and tax changes to a vote on Sunday.
The prospect of such controversial measures being
passed so urgently unleashed a wave of civil unrest with a 48-hour general
strike by private and public sector unions bringing Greece to a standstill.
Unionists said the measures were a “barbaric” eradication of hard-won rights
and would be “the last nail in the coffin” for workers whose salaries have
already been savaged by relentless rounds of gruelling austerity.
In a repeat of the drama that dominated the eurozone
last year, Athens faces the spectre of default if its fails to honour maturing
European Central Bank bonds and IMF loans in July.
2 US jobs growth falters in April (BBC) The US
economy added 160,000 jobs in April - undershooting expectations and well below
the 208,000 created in March, official figures show. March's figure was revised
down from 215,000 and February's was also revised from 242,000 down to 233,000.
The jobless rate remained at 5% and average hourly
earnings rose 2.5%. April's report is being closely watched, as it could
influence an upcoming interest rate decision by the US Federal Reserve.
Aberdeen Asset Management, investment manager Luke
Bartholomew, said: "Anyone wanting a June hike should probably look away
now. The headline number is disappointing, while the household survey looks
particularly ugly. However, Paul Ashworth, chief US economist at Capital
Economics, thinks that a rate increase is still possible.
In December, the Fed raised rates for the first time
in ten years. That rise was seen as the first of a number of moves upwards and
Fed officials have forecast two more rate rises for this year. But since then
the economic news has been mixed.
3 Water scare over world economy (Khaleej Times) Economies
across large swathes of the globe could shrink dramatically by mid-century as
fresh water grows scarce due to climate change, the World Bank reported on
Tuesday.
The Middle East could be hardest hit, with its gross
domestic product slipping as much as 14 per cent by 2050 unless measures are
taken to reallocate water significantly, the Washington-based institution said
in a report. Such measures include efficiency efforts and investment in
technologies such as desalination and water recycling, it said.
"When we look at any of the major impacts of
climate change, they one way or the other come through water, whether it's
drought, floods, storms, sea level rise," Richard Damania, World Bank lead
economist and lead author of the report, told reporters in a telephone
conference.
Water scarcity would not have the same impact
worldwide, and Western Europe and North American economies would likely be
spared, according to the World Bank models. But rising economies such as China
and India could be hard hit, it said.
In the Sahel belt that stretches across Africa below
the Sahara, GDP could well dip some 11 per cent with water scarcity, the World
Bank said. A similar impact would be felt in Central Asia, it said. But
measures to reallocate fresh water could show gains in some regions, the bank
said.
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