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By Mar Cabra
January 23, 2014, 1:30 pm
Until now, no journalist had been able to crack the secret offshore money system on a global scale. But Offshore Leaks laid it bare: Columbia Journalism Review called it “a landmark series on offshore tax havens that has law enforcement scrambling and scofflaws sweating from Mongolia to Germany, Greece to the US.”
Hundreds of articles showed how fraudsters, politicians and the wealthy move and hide money. It took two years for the International Consortium of Investigative Journalists to piece it all together.
The result is a global investigative reporting project that has had unprecedented impact around the world. It prompted high profile resignations, criminal and civil inquiries, policy changes, and official investigations on four continents.
This week we published the last major chapter in the series: the extensive links of China’s elites to tax havens around the world.
We have gathered the stories from more than 60 countries and displayed them in an interactive map that illustrates the breadth of the work.
Despite its proximity to Europe and its status as a major African oil producer, Libya‘s sparse population and relative isolation from its neighbors make the stakes of civil unrest much lower than in other regions of the Arab world.
Libya returned to the headlines Saturday when a protest in front of the headquarters of the National Transitional Council (NTC) turned violent. A group of demonstrators in Benghazi broke into the building, vandalized and looted the property and reportedly drove NTC head Mustafa Abdel-Jalil to flee through a back exit. A leading member of the council has since resigned, and Abdel-Jalil has warned that the country risks heading toward civil war if protests continue to intensify. The euphoria many Libyans felt at the death of former leader Moammar Gadhafi last October has faded, and though elections for a constituent assembly are scheduled for June, it is hard to see a stable, democratic government on the horizon in Libya.
The young men at the protest shared a general feeling of discontent with Libya’s direction more than three months after Gadhafi’s death. But they also share another trait: they all live in Benghazi, the city where the NTC was formed and is supposed to have the highest level of support. Benghazi is where the Libyan revolution started, and many of the NTC leaders come from the city. In less than a year, the council’s self-appointed leaders — many are still involved in the governance of the country — have gone from beloved to vilified in the eyes of many who supported the revolution, including those from Benghazi. Read the rest of this entry »
December 16, 2011Amid all the showmanship and bravado on display during Prime Minister Vladimir Putin’slive call-in program yesterday, there also came a rare moment of sincerity.This happened when Putin was asked to comment on former Finance Minister Aleksei Kudrin, who resigned under pressure following a public spat with President Dmitry Medvedev in late September.
“Aleksei Leonidovich Kudrin has not left my team,” Putin said. “We are old comrades, he’s my friend. He did a lot for the country. I’m proud that this man worked in my government. Such people are needed and will be needed in current and future governments.”
On one hand, Putin’s comments can be viewed as a subtle dig at President Dmitry Medvedev, who demanded Kudrin’s resignation after the finance minister criticized his plans to increase military spending by $65 billion over the next three years. (The rare public dust-up came just days after Putin announced that he intended to return to the Kremlin next year and planed to make Medvedev his prime minister. Kudrin was reportedly not happy about the job swap.) Read the rest of this entry »
The EU’s police and justice mission in Kosovo, EULEX, said a judge had dismissed all five counts against Hashim Rexhepi.
The charges had included abuse of office and fraud. Read the rest of this entry »
Iran had applied intense pressure to Hamas in an effort to persuade it not to leave Damascus, threatening even to cut off funds to the organization if it did so, Palestinian sources have told Haaretz.
The Iranian pressure also included an unprecedented ultimatum – namely, an explicit threat to stop supplying Hamas with arms and suspend the training of its military activists.
Iranian President Mahmoud Ahmadinejad and Hamas political leader Khaled Meshal. Photo by: AP
According to the sources, Hamas is abandoning its headquarters in Syria and looking at other Arab states as an alternative location for its political command center. Hamas’ move comes despite intense Iranian pressure on the organization to refrain from relocating.
A Syrian opposition spokesman said recently that once Assad is toppled, his successors will have no intention of preserving the strategic alliance between Damascus, Tehran and Hezbollah.
According to the Palestinian sources, only “second and third-ranking” Hamas activists are leaving Damascus, while senior members of the organization’s political wing, headed by Khaled Meshal, are remaining in the Syrian capital. Read the rest of this entry »
And so the inevitable has come to pass. Turkey’s central bank has departed from its controversial commitment to a loose policy stance in the face of growing signs of overheating and vulnerability in the economy. The bank signalled yesterday that a phase of marked monetary tightening has now begun.
True to form, the bank went about this tightening in an unorthodox way. But at least it is now pulling unorthodox policy levers in pursuit of orthodox ends. As recently as August, the bank was still loosening policy, easing its benchmark interest rate despite frothy GDP growth rates, accelerating inflation and a current-account deficit of increasingly eye-watering proportions.
The bank’s benchmark interest rate is its one-week repo rate, which stands at 5.75%. The simplest and most transparent way for the bank to have tightened monetary policy would have been to hike this rate. Instead, the bank yesterday announced a new policy of switching on and off the supply of money at this rate, depending on conditions on any given day.
When the one-week rate is unavailable, commercial banks seeking money from the central bank are forced to pay up to 12.5% for money provided on an overnight basis. By switching between these 5.75% and 12.5% rates from day to day, the central bank aims to find a balance appropriate to the needs of the economy.
The bank’s governor, Erdem Başçı, seems quite proud of this new policy, declaring that it gives him a level of flexibility enjoyed by no other central bank in the world. One is tempted to suggest that the reason other central banks haven’t rushed to adopt this level of policy flexibility is that there are other, simpler, ways of achieving the same ends.
Yesterday, the central bank withheld funding at the 5.75% rate. Today, it made 8bn TL available at that rate. And so it will go in the days and weeks ahead. Does this provide the bank with a means of tightening monetary policy to varying degrees? Sure. But it feels a little bit like trying to control a room’s lighting by switching the lights on and off repeatedly rather than by using a dimmer switch.
There can be little doubt that a shift in the central bank’s policy was required. For some time alarm bells have been ringing. In June, I wrote about the threat posed by Turkey’s current account deficit. At that point it stood at about 8 per cent of GDP. It has since moved closer to 10 per cent.
That kind of dynamic is both unsustainable and dangerous. In my earlier post I warned of the risk of a chain reaction being set in motion, with a depreciation of the lira feeding through to higher prices, interest rate hikes and a sharp slowdown in economic activity. We have since seen something like this play out.
The lira slumped in value by almost a fifth during the first nine months of this year. Consumer price inflation is already above the central bank’s 5.5% target and will increase again in the remainder of the year due to recent tax hikes and the rising price of imports. We’ve just seen the beginning of (indirect) interest rate rises to restore stability. It now remains to be seen how significant the impact will be on activity in the real economy. Read the rest of this entry »