Friday, May 13, 2016

This Week: Troubling times for traders

The ‘debate’ over next month’s referendum on whether Britain should stay in or leave the European Union heated up so much this week that it is starting to look like civil war. It seems to be tearing apart the British Tory government and indeed the whole country. A wider worry in the event of a Brexit is the collateral damage in Portugal and other EU countries.
Brexit cheerleader Michael Gove says leaving would be “an empowering moment of patriotic renewal.”  The Governor of the Bank of England, Mark Carney, evoked fury in the Brexit camp on Thursday by saying that leaving might spark a recession. Then the IMF’s Christine Lagarde weighed in on Friday by saying she had “not seen anything that's positive”  about Brexit. Her remarks were dismissed by Brexit supporters as “nonsense.”
Lots of strong opinions continue to be aired, but in truth no one knows for sure what a Brexit would bring. No country has ever left the EU before.
Amidst all the internal rhetoric, scaremongering and false forecasts, a calm but concerned outlook emerged this week from the British Portuguese Chamber of Commerce in London.
Founded in 1911, the BPCC is an independent, non-profit organisation devoted to promoting commercial links between businesses in the United Kingdom and Portugal.
The UK is one of Portugal’s major export destinations, with almost €3 billion worth of goods going there every year. Few countries do more business with Portugal.
The BPCC reports that research conducted by international shippingexperts ParcelHero concludes that the impact of a Brexit on this market could be huge. It could have serious implications not only for Portuguese traders, but also consumers.
It’s impossible to overstate the importance of the EU to Portugal’s trade with the UK,”  writes Keegan Spindler, a member of the consumer research team.
The free movement of goods has allowed British companies to be competitive in the European market, and the cost of shipping in the EU is significantly lower than shipping to European countries that aren’t part of the Union, such as Switzerland or Iceland.
Our research suggests that by leaving the EU, the cost of goods imported to the UK from Portugal could change by as much as 30%. That price change comes from a variety of factors that include raised shipping costs, duties and taxes and handling costs.”
Such a price change would make Portuguese goods less attractive to British consumers and reduce Portuguese manufacturers’ abilities to compete on price in the UK market.
Most Portuguese small to medium enterprises are likely to look elsewhere for their customers if Britain leaves the EU, but those who don’t will have all new challenges to deal with, among them paperwork, customs clearance and duties and taxes. Furthermore, the United Kingdom will no longer be a competitive target for the logistics industry, which is likely to mean that shipping costs will rise significantly, according to the study.
The UK is expected to be separated from countries like Portugal by a lot more red tape, making it a much less attractive proposition for international businesses.
Our data suggests that the UK’s departure from the EU would likely force many SME’s who trade in the country to find new markets for their goods or be forced to quite literally pay the price. Similarly, a Brexit would see the cost of importing in to Portugal from the UK increase, and as Britain is one of Portugal’s biggest importers, it could be the consumers who end up paying the price.”
None of the above will apply, of course, if the Great British public decide on 23 June that voting for Michael Gove’s “empowering moment of patriotic renewal” would in fact be akin to a catastrophic moment of total madness.
Which way will it go? No one probably knows better than the betting bookmakers. Paddy Power’s latest odds:
*  2/5 in favour of remaining in.
*  15/8 in favour of exiting.






Friday, May 6, 2016

This Week: Money, money, money

This week’s revelations about the money laundering activities of Russian gangsters in Portuguese and other European football circles come just days before an avalanche of new information is published from the leaked Panama Papers.
The Russian racket in Portugal was uncovered by the Polícia Judiária (PJ) with the support of Europol in an operation codenamed ‘Matrioskas,’ the name for traditional Russian wooden dolls of different sizes that fit inside one another.
Raids on various clubs and homes in Portugal this week involving more than 70 officers culminated in the arrest of Alexander Tolstikov, the supposed owner of the third division club Uniao de Leiria. He is suspected of tax fraud, criminal association, money laundering, corruption and forgery of documents. An administrator and the financial director of the club were also arrested.
Uniao de Leiria, formerly a respectable Premier Liga club managed by José Marinnho, dropped to the third division in 2012 and went bankrupt before being bought by Mr Tolstikov and associates last year. Virtually unknown in Portugal until he first made contacts in Leiria in the summer of 2014, Tolstikov is alleged among other things to have been behind the importation of large amounts of cash from Russia in violation of EU cash regulations.
Three top Portuguese clubs - Sporting Lisbon, Sporting Braga and Benfica – were reportedly searched because of football transfer negotiations conducted with Leiria, but are not themselves under suspicion.
Europol said in a statement that the investigation had dismantled an organised criminal network, composed mostly of Russians, operating in football circles in the UK, Germany, Moldova, Austria, Latvia and Estonia. The network, active at least since 2008, is thought to have been a cell within the Russian mafia, directly responsible for laundering money derived mostly from criminal activities committed outside the EU area.
Here’s a handy guide to the network’s modus operandi. Step one is to identify a club in financial trouble and infiltrate it with individuals posing as benefactors who provide much needed short-term donations or investments.
Once trust has been been established, step two is for the same benefactors to buy the club and use it as a front for opaque holding companies, invariably owned by shell companies registered offshore and in tax havens. Thus the real owner and those who ultimately control the club remain unidentified, as does the true origin of the funds used to purchase it.
If you want to manipulate a club in this way, it’s best to remain as unostentatious as your greed and ill-gained power will permit. This last bit seems to have been the Leiria gang’s downfall.
All being well, though, once clubs like Uniao de Leiria are under the control of the Russian mafia, the large scope of financial transactions, cross-border money flows and shortcomings in governance allow clubs to be used to launder dirty money. This is usually done by over or under valuing players on the transfer market and arranging television rights deals. Clubs can also be used for betting activities, both for the generation of illegal proceeds due to match fixing or for pure money laundering purposes.
Those somewhat baffled by such skulduggery should relax over the weekend if they want to try to get their heads around next week’s revelations. A vast trove of leaked information about those using tax havens is due to be published on the World Wide Web on Monday.
Just to recap, the Panama Papers scandal all started with the emails of a Panamanian law firm called Mossack Fonseca being penetrated by a hacker. A database comprising 11.5 million documents was subsequently distributed to the International Consortium of Investigative Journalists (ICIJ) for examination.
The first batch of Panama Papers released last month included references to at least 244 companies, 255 shareholders, 23 guests and 34 beneficiaries with Portuguese postal addresses. Monday’s batch is expected to be on a far bigger scale and will be of great interest to law and tax enforcement authorities around the world.
In a related piece of news, the European Central Bank has just announced it is going to stop producing €500 banknotes because of fears they are being used by criminals as a convenient way to launder money and finance terrorism. The bank will stop issuing the €500 notes around the end of 2018, but those currently in circulation will remain legal tender.
Here’s the good news for anyone planning to move a stash from under the mattress. A usually reliable media source mentioned this week that a million euros in €500 notes weighs 2.2 kilograms, or just under 5 pounds, and fits in a laptop bag.




Friday, April 29, 2016

This Week: good and bad from abroad


Rating relief
A potentially disastrous setback for Portugal’s economic recovery was averted with Friday’s announcement that Canada’s DBRS agency has upheld Portugal’s only investment-grade credit rating. A much-feared downgrade to junk status in line with that of the other main agencies - Fitch, Moody’s and Standard & Poor’s - would have seen Portugal cast out the European Central bond-buying program and raised borrowing costs for the government, banks and companies. DBRS said its latest positive rating review “reflects Portugal’s eurozone membership and favourable public debt maturity structure, and reduced vulnerabilities.”

Outsider’s reminder
Timely encouragement for the people of Portugal and the rest of the befuddled EU from a visiting foreigner. President Barack Obama told Europeans they were facing a “defining moment”. The world needs a strong, democratic and united Europe to guard against rising intolerance and authoritarianism within the European Union and across the globe, said Obama in a televised pep talk at the beginning of the week in Hanover, Germany. “Perhaps you need an outsider to remind you of the magnitude of what you have achieved from the ruins of the second world war,” he told his Europewide audience. Europeans should not retreat from the extraordinary achievements of the postwar years, but consolidate them and repudiate those who want to turn back to the narrow nationalism of the past. Almost 60 years after the founding of the European Union, what is needed is a renewal of confidence and a rejection of populist politics on the far left and far right. Obama advocated a unified, peaceful, liberal, pluralistic, free-market Europe, not one that doubts itself and thus empowers those who argue that democracy can’t work.

NATO bashing
In a speech in Washington on Wednesday, Donald Trump had nothing good to say about Obama or Europeans. He lambasted Obama and Hillary Clinton for their “reckless, rudderless and aimless foreign policy.” He promised to save “humanity itself”, first and foremost the USA, but had a dig at NATO's “outdated mission” and insisted that America’s European allies are “not paying their fair share.” By contrast, the Secretary General of NATO Jens Stoltenberg in a meeting with Prime Minister António Costa last month thanked Portugal for its strong commitment to the transatlantic alliance, its active role in political debates, and its concrete contributions to NATO missions and operations.

Russia beware
Seemed like a poke in the eye for Putin as the good ship Creole Spirit sailed into the Portuguese port of Sines this week. She was laden with a first shipment from the United States to Europe of liquefied natural gas. Similar shipments from Houston, Texas, to France and the UK are planned for some future date. The United States is the world’s biggest producer of natural gas. Russia has long been dominating the market and supplying Europe with a third of its natural gas needs. Attitudes changed with the imposition of sanctions against Russia because of the conflict in Ukraine. According to Deutsch Bank, the United States could become Europe's main natural gas supplier – but not for another 10 years or so.

Island invaders
How can a ground-hugging plant with beautiful flowers seriously interfere with a graceful bird that spends most of its life gliding wide and free over the open sea? The exotic Hottentot Fig or ‘ice plant’, native to southern Africa, was introduced to the Mediterranean region for medicinal and ornamental purposes a few decades ago. It went wild. Dense carpets spread along the Portuguese coastline, killing endemic plants in many places, including the Berlengas archipelago north of Lisbon, the Azores and Madeira. Large numbers of Cory’s Shearwaters come ashore on these islands at this time of year to breed, but the Hottentos have been blocking their nesting burrows. In a project started in 2014 and not scheduled to end until September 2018, up to 40 volunteers and technicians from the Portuguese bird society SPEA are working on the Berlengas islands to eradicate the invasive plants and give the shearwaters the space they deserve.





Friday, April 22, 2016

This week: It's all about numbers

Fudged figures
As Portugal and other EU members wait with bated breath, it seems that Britain’s referendum on staying or leaving is likely to go down to the wire. The expatriate vote could be decisive, it is said. But does anyone have any idea how many expatriates are out there? The Labour Party leader Jeremy Corbyn told TV viewers, “there are nearly three-quarters of a million British people living in Spain and over two million living in other parts of Europe”. Completely wrong, according to the BBC. The Beeb reckons the true figure for UK-born permanent residents in Spain is 306,000, and for the EU as a whole 1.2 million. The generally accepted figure for British expats in Portugal is only 40,000. No one knows how many if these are eligible to vote. Every vote counts, as they say, but given the confusion and contradictions in the ongoing referendum rigmarole, how many eligible voters will bother?

McCanns v. Amaral
The libel legal battle started seven years ago. Kate and Gerry McCann sought €1.2 million in damages. A court in Lisbon awarded half a million plus interest last April. This week, freedom of expression prevailed over privacy. Gonçalo Amaral won his appeal and will not have to pay anything. At least for the time being. The McCanns are apparently planning to take the matter to Portugal’s Supreme Court. After that, Amaral may sue Madeleine’s parents for hundreds of thousands in compensation for financial losses and harm to his reputation. No end to the matter is in sight. It could go on for years to come.

Kidnap case
In an even more elongated, complicated and highly unusual case, former CIA operative Sabrina de Sousa, 60, is facing imminent extradition from Portugal to Italy. She is accused of involvement in the kidnapping of an Egyptian cleric in Milan more than 13 years ago. Along with 25 other Americans, she was convicted in absentia by Italian courts and sentenced to four years imprisonment. As a dual American and Portuguese citizen, she would have avoided the threat of imprisonment had she remained in the US. Last spring, however, she moved to Portugal to be with her relatives. Some months later, she was detailed at Lisbon airport on a European arrest warrant. On the day of the kidnapping, Sabrina de Sousa had been chaperoning a group from her son’s high school on a ski trip in northern Italy. Although she has always maintained she played no part in the kidnapping, Portugal’s highest court this week confirmed that she should be sent to Italy as soon as May 4.

Irish invasion
Many more Irish eyes are expected to be smiling (behind sunglasses) in tucked away places in Portugal this summer. A big green booking surge is expected over the next few weeks. Not only is Portugal far from the maelstrom at the opposite end of the Mediterranean, but the price of meals and drinks here is alluringly low. Pat Dawson, CEO of the Irish Travel Agents Association, says the focus will be away from the Algarve and Lisbon and “on country places that are not overpopulated or overcrowded, as many people don’t want to be on a beach with 10,000 people, they want small places and to meet the locals.” That lessens the chances of finding a pub serving draft Guinness. The good news is that a bottle of lager in Portugal is a quarter, yes a quarter, of the price in Ireland.

Pets and people
Amid valid concerns about the extent of animal cruelty, Portugal’s Minister for Justice, Francisca Van Dunem, reportedly dislikes animals being considered “objects”.  She has suggested that the legal status of animals be elevated to somewhere between “objects” and “humans”. Many animal lovers would prefer a classification on a par with humans. Some might even suggest that certain types of people should be downgraded from “humans” to somewhere below “objects”.

Coming soon
Two big celebrations on Monday, 25th April. The big one in Portugal: the 42nd anniversary of the ‘Carnation Revolution’. On the same day in the US and more than 30 other countries many thousands of older women will be celebrating Red Hat Day. Will any Red Hatters appear in Portugal? Let’s see. 


Tuesday, April 19, 2016

Amaral wins appeal in McCann case

Gonçalo Amaral has won his appeal against a Lisbon court’s decision last year to award half a million euros in damages to Kate and Gerry McCann.
The award arose from the McCanns’ objection to Amaral’s book  Maddie: The Truth of the Lie published in 2008. The overturning of the damages ruling and the lifting of the ban on the book is said to have come as a huge relief to Amaral and his many supporters and admirers.
As the former coordinating detective in the original Portuguese investigation into the disappearance of Madeleine McCann, Amaral has always questioned the McCanns’ insistence that Madeleine was abducted. He believes they were involved in their daughter’s disappearance and fabricated a cover-up story.
After last year’s judgement, Amaral described the court’s libel ruling as unfair in that it questioned every Portuguese citizen’s right to freedom of expression and of opinion. “For that reason I do not resign myself to the decision and I will appeal it until the very last judicial instance,” he said.
The court’s latest decision was a unanimous one by three judges. It is another dramatic twist in a long-running saga that may not yet be over. The McCanns are likely to appeal against the latest judgement and take the matter to Portugal's Supreme Court.
The McCanns began their action in 2009. It has been lurching  along between lengthy delays ever since. The award of €500,000 plus interest was made last April, though no money was actually handed over.  Madeleine’s parents had been hoping for €1.2 million in damages.



Tuesday, April 12, 2016

Slap attack and other cultural news

- a review of recent events -

Soares shock
João Soares, the former mayor of Lisbon and son of former Prime Minister and President Mario Soares, apologised and resigned as minister of culture because of remarks on Facebook in which he threatened to slap the faces of two newspaper columnists who had called him incompetent and rude. One of the hacks huffed that Soares’ threat amounted to “an attack on freedom of expression and the constitutional rights of citizens”. It took more than a couple of slaps to introduce those rights. Actually, it took a revolution. One of the leading figures behind the freedoms that followed that April event 42 years ago was João Soares’ dad. Perhaps it’s time for Soares Sr to have a word with his son about taking freedom too far.

Out of step
Twelve years ago, a political commentator, Marcelo Rebelo de Sousa, resigned from the TVI channel because he was being leaned on to stop being so critical of the government. Last week Portugal's armed forces chief, General Carlos Jeronimo, resigned after being leaned by the minister of defence over remarks made by a subordinate about gays. So much for freedom of expression. The general’s resignation was accepted by the new President of Portugal, none other than Marcelo Rebelo de Sousa.

Sex and secrets
Strict Catholics here and everywhere else will be pondering whether parts of Pope Francis’ missive published last weekend were perhaps ill-conceived. Many will consider Amoris laetitia (‘joy of love’) too gracious about sexual desire, the pursuit of pleasure, divorce and other arguably sinful aspects of modern family life. That aside, presumably nothing more than serendipity was involved in the timing of the missive. It was released the day before news broke of a secret premarital affair that resulted in an illegitimate baby destined to become, er, the Archbishop of Canterbury.

Catching up
Foreigners never cease to comment on the bad manners of Portuguese drivers and in particular their insistence on tailgating. A new survey has revealed that 57% of motorists in the UK act more aggressively when behind the wheel. Over 30% of those questioned admitted to swearing at strangers while driving. A third confessed to having beeped their horn aggressively. Fully 11% said they had deliberately tailgated another vehicle. Could it be that British drivers are catching up on their Portuguese counterparts?
Whale tale
Japan’s Institute of Cetacean Research sent its whaling fleet into the Southern Ocean during their summer months, ostensibly for scientific studies. Now a website promoting gourmet recipes and tips on how to prepare and cook whale meat has been exposed as being hosted by the very same Japanese ‘research’ institute. In entirely coincidental and unrelated news, Tomoaki Kanazawa, a Japanese chef living in Portugal, will be demonstrating Eastern techniques of preparing seafood during the ninth annual Fish and Flavours festival which opened last Thursday and runs until April 17. The expected 20,000 visitors need not fear. Cetacean steak ‘n chips will not be on the menu.
Bathroom blues
Lisbon’s loo laws may come under scrutiny prior to rock star Bruce Springsteen’s scheduled performance in the capital on May 19. He cancelled a concert in North Carolina last Friday in protest about a new state law there that says transgender people can only use bathroom facilities that correspond to the gender featured on their birth certificate, not their current appearance. But surely separating ‘homens’ and ‘mulhers’ facilities here is outrageously sexist and should be banned?

Poop-pooping
The first sound of  ‘Cuc-koo, cuc-koo’  in Britain inspires letters to The Times newspaper. Mindful that the UK is still a member of the EU and Brits might be interested in Schengen species, an expat wrote to The Times from the Algarve saying he had just heard the first Hoopoe. Incidentally, Hoopoes in Portugal start calling to attract a partner not in April but in February. And strictly speaking, they don’t ‘hoo-poo, hoo-poo’’. Rude as it may seem, they ‘ poop-poop, poop-poop’.


Tuesday, April 5, 2016

Panama papers: the power of the press

Portugal’s corrupt, tax-evading, money-laundering politicians, administrators and businesses this week suddenly found themselves in distinguished international company, ranging from the presidents of Russia, China and Ukraine and the kings of Saudi Arabia and Morocco, to international stars of sports and entertainment. All praise to the hard, honest work done by the International Consortium of Investigative Journalists in exposing 11.5 million files, 140 politicians from more than 50 countries and offshore companies in 21 tax havens. ‎It may be only a matter of time before it is revealed that Vladimir Putin, José Sócrates and others have been taking greed-enhancing drugs.
Terminal talk
It’s not only Donald Trump who’s been going round in circles on abortion. His gaffe that women who undergo an abortion should be punished was reminiscent of the law of the land in Portugal until less than a decade ago. Women here faced up to three years in prison, except in cases of rape or if the health of the mother or foetus was in danger. Trump quickly changed tack. So did Portugal after a 2007 referendum that overturned staunch pro-life support from the Catholic Church. Women were given the legal right to an abortion paid for by the state up to 10 weeks into a pregnancy. Last year, amid cries of ‘shame!’ from women’s rights activists, the Portuguese parliament introduced fees for abortions and a legal requirement that women get psychological and social counselling and advice on family planning before ending a pregnancy. A long gone journalist once remark: “Curses on the law! Most of my fellow citizens are the sorry consequences of uncommitted abortions.”
Silence in Spain
British expats in Portugal are not allowed to vote in general elections but that doesn’t stop many of them castigating the Portuguese government in the local English-language media. Apparently there is a severe shortage of such people over in Spain. A columnist in last week’s edition of the Euro Weekly News, Spain’s largest free local paper that boasts a readership of more than half a million each week, was moved to write: “I find it quite strange that we have so little reaction from readers about the current state of the Spanish government and the fact that it seems impossible for any party to form a stable relationship. We may not be able to elect the government but we have elected to live in Spain, and whatever decision is made over the next few months will have an ongoing effect on the lives of each and every expatriate living here”. The article concluded with what sounded like a desperate plea: “It is true that the individual can’t alter things but surely someone, somewhere must have an opinion to share with the rest of us on the current state of the government.” Can anyone this side of the border help out please?
Historic news
The main headlines in Portugal and across much of the Western world in the first week of April 1949 hailed the founding of the North Atlantic Treaty Organisation (NATO). Portugal was one of the 12 original signatories in Washington. President Truman spoke of “a shield against aggression” that “will protect this area against war.” So far, so good.... Well not quite.
Wild art
The Portuguese street artist Bordalo II has struck again, this time by upgrading from a huge lynx to a giant wolf. According to Street Art News, a web magazine with what it calls “obsessive” daily coverage of everything new in the world of graffiti, Portugal’s equivalent of Banksy unveiled his latest masterpiece within two days of scavenging garbage sites and abandoned houses in Fundão, near Castelo Branco. This came shortly after his 3D depiction of a lynx in Viseu. It might be tempting but it would be quite wrong for art connoisseurs to just dismiss Bordalo II’s new work as rubbish.


before.....

.....after