Showing posts with label Finland. Show all posts
Showing posts with label Finland. Show all posts

1/18/2023

What if Turkey blocks Finland and Sweden NATO bids?

 




Source: Responsible Statecraft
By Mark Episkopos
January 18 2023


Many believe Ankara can be mollified — at a cost — but rejection of the Nordic countries’ ascension remains a real possibility.

Turkish Foreign Minister Mevlut Cavusoglu is set to meet his U.S. counterpart Antony Blinken in Washington this week. There are scant expectations among observers that the visit will resolve any of the outstanding issues in what has been an increasingly troubled bilateral relationship, with the Biden administration keeping its distance from Ankara over allegations of human rights abuses and the Eurasian country’s increasingly warm ties with Moscow.

Turkey has reaffirmed its uncompromising stance on the fraught NATO bids of Sweden and Finland, setting the stage for a showdown with serious long-term implications for both Ankara and the alliance.

Ibrahim Kalin, a spokesman for Turkish President Recep Tayyip Erdogan, said on Saturday that Ankara is “not in a position” to approve Sweden’s NATO bid until all of Turkey’s concerns have been addressed. “We have a time issue if they want to join NATO before the NATO summit in June,” he added, noting that Sweden’s judicial system must change its legal definition of terrorism for Turkey to lift its opposition to Stockholm’s accession, which requires the unanimous approval of all member states.

Stockholm and Helsinki simultaneously submitted applications to join the alliance in May 2022, citing the new security realities brought on by Russia’s February 24 invasion of Ukraine. Their accession process, which NATO Secretary General Jens Stoltenberg assured last summer will be the fastest in the alliance’s history, has been delayed indefinitely amid unresolved Turkish objections.

Ankara officials said the two Nordic countries have continued to shelter Kurdish militants, with President Erdogan insisting their accession bids cannot move forward until they agree to extradite persons sought by Turkish authorities on terrorism charges. Yet Swedish and Finnish courts have denied several extradition requests, including one reportedly pertaining to exiled dissident journalist Bulent Kenes. Cavusoglu decried the rejection as a “very negative” development, insisting that the two Nordic countries have not taken sufficient steps to satisfy Turkey’s strict conditions for clearing its objection to their accession. “We no longer want to hear good words from Sweden and Finland, we want to see concrete steps,” Cavusoglu said.

Swedish Prime Minister Ulf Kristersson said early in the new year that his country has done all it could to address Ankara’s concerns even as Turkish officials continue to insist Stockholm has not done nearly enough. Tensions over Sweden’s NATO bid reached a fevered pitch after footage emerged last week of an Erdogan effigy hanging from a lamppost in Stockholm, prompting a furious response from Turkish officials. “Unless the activities of terrorist organizations are halted, it is not possible for the NATO membership process to progress,” said Kalin, according to Al Jazeera.

The Nordic applicants appear no closer to sealing an accession deal with Turkey today than they were over half a year ago when talks began. Turkish experts contend Ankara is unlikely to drop its opposition to NATO enlargement until after the June election cycle in Turkey, with Erdogan facing a stiff re-election challenge against a six-party opposition coalition. Others have suggested Turkey’s extradition demands from the two applicants are a facade for larger concessions it is seeking to extract from the United States — namely, a $20 billion sale of F-16 fighter jets. Though the Biden administration has signaled it intends to greenlight the deal, at least one top senate Democrat — Bob Menendez, chairman of the Senate Foreign Relations Committee — has already vowed to block it.

It is generally consistent with Erdogan’s modus operandi to levy ambitious demands vis-a-vis his interlocutors only to settle for a more modest set of concessions when all is said and done. Yet there is also a clear precedent for the Turkish leader doubling down in response to international pressure. Erdogan proceeded in 2018 with plans to purchase the Russian S-400 missile system despite U.S. warnings that there will be significant consequences and refused to reverse his decision even in the face of CAATSA sanctions and Turkey’s costly removal from the F-35 partner program.

The current impasse over NATO enlargement could play out in several ways over the coming months. Anxious to bring the matter to a close, Washington and its allies may become progressively more heavy-handed in pressuring Ankara to back down through public and private channels. Erdogan, who is well-known for his eristic tendencies even in dealing with leaders of allied nations, may very well respond by lashing out in unpredictable ways.

Though it remains unlikely that a confrontation along these lines would lead to Turkey leaving or being expelled from NATO, it would shake the unity of the alliance at a dangerous moment for European security. Further still, an aggrieved Erdogan bent on undermining the organization from within could prove just as corrosive to NATO in the long run as a formal divorce between Turkey and the alliance.

Then there is the not-insignificant possibility — one that appears to have grown more likely in recent weeks and months — that Turkey could end up torpedoing the NATO bids of Finland and Sweden altogether, leaving the applicants and the alliance in uncharted waters. But regardless of how the accession drama plays out, the standoff has exposed what has become a foundational challenge for NATO in the post-Cold War world: the principle of limitless horizontal expansion has heightened the risk of internal contradictions among NATO’s increasingly diverse membership, making it more difficult over time to distill common geopolitical goals and to maintain the credibility of the Article V commitment that is at the heart of the alliance.

This dynamic poses a serious and growing liability for an organization that must make every major decision on a consensus basis.

Turkey’s actions in holding up NATO enlargement come as part of Erdogan’s larger effort to chart what he sees as an independent foreign policy course between Russia and the West. Ankara rejected the maximum pressure strategy against the Kremlin adopted by NATO’s leadership and most member states in response to Russia’s invasion, instead positioning itself as a neutral broker between Moscow and Kyiv.

Ankara’s neutrality has yielded some success in the form of the Black Sea Grain Initiative, the only significant international treaty involving both Russia and Ukraine since the war’s outbreak. Erdogan has been able to carve out this niche in a unique wartime context: none of the major Western powers have been willing to engage Russia in direct talks, giving outside players opportunities to fill the void.

The conflict poses something of a paradox for Ankara. Erdogan is committed to facilitating a negotiated end to the war and came much closer than anyone else to doing so, according to reports from the failed Antalya summit in March. Yet it is precisely the war that has empowered Turkey with a degree of international clout that would otherwise have been unattainable. It remains to be seen to what extent Erdogan’s successor — regardless of whether they enter office as a result of this year’s election or at a later point — will seek to carry on his ambitious vision, nor is it clear how exactly the inevitable transition to a post-Ukraine War landscape will alter the strategic imperatives confronting Turkey.

The war has been a catalyst for geopolitical change, prompting both NATO and Turkey to pursue policies unthinkable in peacetime. The story of these transformations, closely tied as they are to the war’s course and its eventual outcome, is still being written.


2/17/2012

Athens faces tough bail-out terms


Πηγή: FT
By Peter Spiegel, Gerrit Wiesmann and Matt Steinglass
Feb 17 2012

A €130bn bail-out of Greece will contain unprecedented controls on Athens’ ability to spend funds, officials said, as European leaders scrambled on Thursday to paper over their divisions on the rescue package.

The agreement, which officials hope to finalise on Monday, is likely to include an escrow account that must always contain enough cash to pay Greece’s debt for nine to 12 months. If the account falls below that level, money will be taken from funds earmarked to run the Greek government, according to people briefed on the talks. In addition, the bail-out will include a permanent and beefed-up presence of international monitors who will attempt to keep real-time tabs on the Greek government’s spending decisions, officials said.

If the deal is finalised by Monday, it will still include a list of 24 “prior actions” that Greece must complete by the end of the month, before aid is released.

The deal will be quickly followed by a €200bn Greek debt restructuring, with offers to private debt holders to participate to be issued on Wednesday. The offer would be open for 10 days, officials said, and the swap formally completed a week before a €14.5bn bond becomes due on March 20, narrowly avoiding a default.

But senior officials warned that a deal was not assured. According to one official, under the plan Greece’s debt would be more than 128 per cent of economic output by 2020. That is well above the 120 per cent the International Monetary Fund and several northern European Union countries have demanded.

Moreover, divisions remain in Berlin over whether to proceed with the programme or let Greece default.

Angela Merkel, chancellor, has remained steadfast in her determination to avoid a default but two senior officials said that Wolfgang Schäuble, finance minister, had become increasingly adamant in his opposition to sending more aid to Greece, believing it would be misspent.

Officials in Finland and the Netherlands expressed similar views. “I am not advocating a Greek default, hard or soft, but I’m not excluding the possibility of it if the Greeks don’t get their acts together,” Alexander Stubb, the Finnish EU minister, said during a trip to Brazil.

Jan Kees de Jager, the Dutch finance minister, told his parliament that, in order to get to 120 per cent of economic output, the bail-out would have to rise to €136bn. Dutch, German and Finnish officials have insisted on a €130bn limit and Mr de Jager said the three triple-A rated countries had come close to vetoing the programme at a planned eurozone finance ministers meeting on Wednesday, which was called off at the last minute.

“We decided to postpone the eurogroup meeting because we realised that otherwise it would have gone wrong, to put it simply,” Mr de Jager said. “I, my German colleague, and my Finnish colleague would have had no other option but to say ‘no’.”

Eurozone leaders are still debating ways to keep pressure on Athens, including holding back aid not tied to the debt restructuring until after Greek elections in April. But two officials said that idea was now off the table. “If this is going to happen, it’s going to happen in one step,” said a senior eurozone official.

Officials have moved to push Greece towards a “grand coalition” with the country’s two main parties – the centre-left Pasok and centre-right New Democracy – sharing power.



2/15/2012

Greek banks are going to pay for Finland's collateral demands



The four major Greek Banks are going to lift the load of paying the collaterals' value of 800 million euros demanded by Finland. According to “Kerdos” newspaper the minister of finance Mr. Venizelos announced the decision without any prior understanding at a meeting held last Wednesday.

Finland demanded the collaterals to lift its objections and to unblock the funding process in Greece. According to the government's plan, banks depending on the amount of their assets will provide a portion which will disburse in cash. This will be deposited in an interest-bearing deposit invested in government bonds of first grade for the countries in the euro area, for 30 years. It is worth noting that the interest is paid annually, but at the end of the period. Initially the amount will be deducted from the liquidity of the banks in terms of the present value. Then it will be registered as damage to the first quarter results reducing proportionally the capital of each bank. 

This loss in not covered by the recapitalization program to be implemented in the coming months. The information indicates that Mr. Venizelos, announcing the government's decision, left no room for discussion, asking that he expects banks to do at this difficult juncture “their national duty”. He reportedly said: “If you do not close this little hole it would create a huge problem in terms of the proper development of the whole process”. The details of the whole matter discussed between banks in a teleconference held last Sunday.





8/26/2011

Finland abandons Greek collateral deal under German pressure

Finnish far right politicians have pushed for guarantees. But others fear the deal could erode good will in Brussels (GregHickman)

Πηγή: EUobserver
BY ANDREW RETTMAN
26/8/2011


Helsinki has abandoned a loan collateral deal with Athens after fellow eurozone countries said it threatened to undo the EU's second Greek bailout.

A contact in Finnish finance minister Jutta Urpilainen's office, speaking on condition of anonymity, told EUobserver on Friday (26 August): "The solution with Greece that we had last week is not valid any more but negotiations are ongoing for another solution."

The decision comes after German Chancellor Angela Merkel on Wednesday said eurozone countries "should not take unilateral steps in the Greek crisis". Austria and the Netherlands also said they would block the Finnish-Greek deal unless they got similar treatment.

Under the terms of a 21 July pact on the new Greek bailout, all 17 euro-using countries must give consent for any top-up bilateral arrangements.


Finland had originally agreed that Greece would place up to €600 million in an escrow account in case it could not pay back the full amount of Finland's €1.4 billion part of the rescue package. Urpilainen back in July indicated that Finland might accept Greek state-owned property instead of cash as a form of guarantee.

Eurozone countries are racing to implement the 21 July deal - which also covers new bond-buying powers for the EU crisis fund, the EFSF - by the end of September in order to restore market confidence in the single currency.

The currency club suffered another setback on Wednesday when the Cypriot parliament's finance committee declined to back government tax hikes.

The committee asked Nicosia's finance minister Kikis Kazamias for more time to prepare amendments.

The development comes as Cyprus risks joining Greece, Ireland and Portugal in seeking eurozone financial support after an explosion at a power plant last month blew a hole in the country's budget.

Opinion-makers have in recent days heaped scorn on the EU's attempts to contain the crisis.

Former German chancellor Helmut Kohl said Merkel has undermined Berlin's "dependability." One-time EU commission president Jacques Delors said the euro is "on the brink." Former US treasury chief Alan Greenspan said it is "breaking down."

For his part, French President Nicolas Sarkozy talked up the euro on a trip to China on Thursday.

"[Chinese President] Hu has made a very definitive declaration about the confidence that he has in the eurozone and in the euro," he told press. "The concerns of President Hu and of the Chinese leadership are of the same nature as those of all the leaders who regard the situation. He is neither more nor less worried."

Chinese state press ahead of the French visit described the euro crisis as a new form of Black Death - an epidemic which decimated medieval Europe.

"We are certainly worried about the West's economic difficulties," Chinese deputy foreign minister Fu Ying said in a statement posted on the foreign ministry's website last week. "If European countries can hand-in-hand resolve the problems, the EU will continue to progress and further integrate, otherwise the euro zone could collapse."


8/20/2011

Finland puts Greek bailout package under pressure

Timo Soini, the founder of the True Finns party, has become a force to be reckoned with in the Nordic country (European Parliament)


Πηγή: EUobserver
By HONOR MAHONY
19.08.2011


The eurozone's second bailout for Greece, agreed in July, already looks in trouble as a series of smaller EU countries demands that Athens puts up collateral in return for national loans.

The Finnish government has been leading the push. Helsinki on Tuesday (16 August) announced that a deal had been reached with Greece that would see Athens make a cash deposit to guarantee Finland's share in the €109 billion bailout.

Finland has taken a hard line after the anti-bailout True Finns party burst onto the domestic political scene and scooped 19.1 percent of the vote in the April elections.

But the Tuesday deal has sparked a domino effect - Austria, the Netherlands, Slovenia and Slovakia have all indicated that they want the same treatment.

"The model has to be open to all euro countries. We plan to find out if this is the case", said Austrian Finance Ministry spokesman Harald Waigelin in a telephone interview with Helsingin Sanomat on Wednesday.

Dutch Finance Ministry spokesman Niels Redeker said The Hague had always "indicated in discussions in Brussels that if Finland would get a collateral agreement that we also want a collateral agreement."

The Slovenian finance ministry told AP news agency that it is looking for "possible guarantees" for its loan.

These countries only account for about 11 percent of the total loan but the move serves to further undermine the already fragile sense of solidarity in the 17-nation eurozone – as well as making markets more jittery.

While no big countries have yet asked for collateral, it raises the general question of whether some euro countries will simply accept to have worse loan terms than others by not asking for guarantees.

The need to put up collateral whether in the form of cash or other assets may also ultimately impair Athens’ ability to pay back the general loan.

Finland, needing parliamentary approval for the Greek bailout, has said what others do is their business.

"From Finland's point of view it's clear. We don't really have to be worried if other countries want similar or other guarantees from Greece," Jussi Lindgren, financial secretary at the Finnish finance ministry, told Finnish broadcaster YLE. "They would have to negotiate their own deals, and see if it's at all possible."

All such bilateral collateral deals have to be approved by the eurozone countries.

The uncertainty created by the demands are likely to further unease markets which have consistently doubted the underlying political commitment to deal with the eurozone’s debt crisis.