1 IMF chief sees Grexit a possibility (Helena Smith & Heather Stewart in The Guardian) The head of the International Monetary Fund has warned that a Greek exit from the eurozone is a “possibility” as debt talks reach a critical stage.
Christine Lagarde said a deal with Athens was unlikely to be reached over the next few days, as the indebted country strives to meet a 5 June deadline for a €305m (£218m) payment to the IMF. The IMF managing director said: “A Greek exit is a possibility.” Lagarde added that such a step would “not be a walk in the park”, but would “probably not” mean the end of the euro.
Her comments came as Athens’ lead negotiator admitted Greece required intervention at the highest political level in Europe in order to seal an agreement after acknowledging that ongoing negotiations in Brussels would not achieve a final deal. Greek ministers have admitted next week’s €305m payment cannot be met without securing a deal to release the €7.2bn of loans outstanding on the country’s current bailout programme.
The IMF is said to be insisting that Athens must be offered debt relief if its future repayments are to be manageable, but that would mean lenders, including the European Central Bank, writing off some of the Greek debts they own. That proposal is being resisted by other members of what was known as the creditors’ “troika” of the IMF, the EU and the ECB.
2 Why sponsors aren’t tougher on Fifa (Robert Peston on BBC) The Fifa scandal is an “absolute disaster” for the multinationals who sponsor it – because they cannot escape taint from the perceived lapses of football’s supreme governing body. So why aren’t these huge and powerful global companies doing what the UK culture secretary John Whittingdale has asked, and following the lead of Visa – which said it would review its sponsorship deal if Fifa does not clean up its act?
Well, part of the answer is implicit even in the less mild sabre-rattling of Visa. Because it is striking that even Visa only said it might review its commercial relationship with Fifa, not that it was doing so. The point, according to well-placed executives, is that Coca Cola, Hyundai, Budweiser, McDonald’s, Gazprom and Visa (among others) have signed legally binding contracts.
So they may not be able to get out of the contracts without paying spectacular damages – given that they are each believed to be paying Fifa up to $200m (£130m) over four years for the marketing opportunities associated with the World Cup. There is another point, though, which is that the World Cup is “the best sponsorship opportunity on the planet”.
How so? Well, association football is arguably the world’s most global sport – though the Olympics and Formula One also have serious worldwide reach. And the World Cup allows the sponsors to get their names in front of hundreds of millions of consumers, both in the rich West and in the faster-growing economies of Asia and South America.
So, although all the sponsors want to be seen to be doing the “right thing” by putting pressure on Fifa to reform, they are fearful that if they completely incinerate their relationships with the World Cup, they may simply be providing a precious and rare marketing opportunity to their bitterest rivals.
3 Tough times for Singapore ornamental fish biz (Jessica Lim in Straits Times) Things are not looking pretty for Singapore’s ornamental fish business. The Republic might still be the world’s largest exporter of ornamental fish like mollies, guppies, goldfish and koi, but the amount of fish exported has fallen to levels similar to those a decade ago.
Major exporters here point to a strong Singapore dollar, falling global demand, high operating costs and uncertainty over the lease of their premises. The latest UN Comtrade statistics showed that firms here exported about $56 million worth of fish in 2013. This is a dip from 2012, when Singapore exported $62 million worth of ornamental fish, and is even lower than the $60 million in 2009 – in the aftermath of the global financial crisis. Figures peaked at $69 million in 2008.
Export figures for 2013 were comparable to the $54 million worth of fish exported in 2005. Sanyo Aquarium managing director William Chew had 20 per cent less turnover last year than in 2013. Mr Chew said ornamental fish farms here “are afraid to invest”. They can set up only in locations approved by the Government, and such land is leased out for a limited number of years.
Dr Maliki Osman, Minister of State for National Development, said it was critical that firms find ways to raise productivity. He said the ministry is exploring the possibility of developing a multi-storey building for flatted farming, like a flatted factory, a move he called a “game changer”.
But at least one company has thrown in the towel. Mr Fong Ching Loon, 78, owner of Pisces Tropica and chairman of the Singapore Aquarium Fish Exporters’ Association, shut his firm in January despite having paid rent until 2020 and spending $2 million to relocate in 2010. “We make a smaller loss closing down than remaining open,” he said.