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Tuesday 5 November 2013

Still looking for sustainability..

Hello. I am Nicos, blogging again but.. tonight i feel like a writer !
Since i joined Coursera i am a little bit of everything and honestly, i love it.
I feel that life-long learning helps you complete a puzzle that can't be completed if you are not well prepared and ready to accomplish it.

At present, i study "English composition" and as the instuctor states, if you write then you are a writer.. Well, actually i am a blogger for about three years, blogging in Greek for whatever happens around me, critisizing governmental policies, local (district) issues happening in my municipality. Since last March i decided to share my knowledge in English. The bankrupcy of Cyprus was something i expected but since i have some answers for what happened i have to share this knowledge with people that might find the same problems in the future. Like the French..

Bankrupcy in the Eurozone countries is something that should be expected as norm due to the inequalities of the Euro-system. For example when Greece joined the Euro, was forced to devaluate the national currency by 15%. This was the start for the collapse of the whole Greek system due to an obvious fragility nobody analysed. They entered the Eurozone but kept the lending interest extremely high. Imagine that you are a company that produces jams in Greece. You have a bank loan with 10% interest rate. Now imagine your uncle who lives in Italy owes a factory that produces jam in Italy, working with a bank loan of 7%. And to make the case more ineresting your cousin who lives in Germany, works for a factory producing jam (WOW!) and they have a loan paying just 4% interest. You all are part of the Eurozone but someone is lucky to have a low interest and be more competetive! Well it's just a case study.. but.. it seems that the factory in Greece will start loosing clients due to lower cost prices in Cyprus and Italy. After a few years, the factory in Italy will start losing clients due to the fact that the German factory sells cheaper. Finally, the German factory will be the only one that sells the jams but.. the people will not be capable to buy jam since they are unemployed ! So... they import jam from Bulgaria. It's cheaper due to the currency difference.. Let's pause the case study for a while..

The first exersice of this class was to create my timeline and by creating my timeline, i realised that my life makes circles. In 1995 i went in Athens for studies. I wanted to become a political scientist. Actually, i remember that when i asked my school councellor, back in 1992, whether i should study political science she replied that it was the best study she could think for me. What a normal wannabe political scientist does? Well for me was to ask for a meeting with my favoured politician which was Antonis Samaras (back in 1995 he was a wannabe prime-minister..). I was happy the day i was finally meeting him. Big disappointment followed since i was informed that our appointment should be postponed due to a funeral of a lady. I couldn't understand why he had to go to the funeral or who the dead lady was.. As i realised a few days later that lady was one on the most powerful and respected newspaper editors in Athens. Eleni Vlachou was a legend in the country but.. a 19 old year boy, living far away never heard of her..

Days later, i finally met Antonis Samaras. I was amazed. He seemed a nice guy. I still believe he is. But.. after i started analysing the Greek political system i found out that you can't really change anything.. The system was so complicated designed that it was already half dead. It was too obvious that this system could never work so i decided to study but not to enter politics. That time the Albanians gained the priviledge to enter the Greek market and work. Greek businessmen could hire Albanians insted of Greeks and pay them lower wages due to the huge black labour market Greece had. Well.. eventually, this gave to the Albanian people money and sent Greek people to unemployment. Ten years later the same pattern was adopted in Cyprus. After entering the Eurozone, Cypriot employers could hire cheaper hands from Bulgaria and Romania. Those people came to Cyprus and entered every sector since they were cheaper labour. The same result happened to Cyprus. Cypriots were unemployed, they stopped spending and the system crashed.

As it appears nobody analysed what inequalities cause. The people designed the Eurozone hoped that they could achieve higher quality in living and education but... they forgot to create the proper legitimate system in order to make the vision successful. In countries where law is not respected, you have to expect a continuous downgrade. A downgrade that will be spread all around the rest of the same system countries.

I left Greece in 2007 knowing what will happen. In 2013 i decided to leave Cyprus and move to France.. Cyprus is dead because of those hidden inequalities no one wanted to fix. The stockmarket collapsed in 2001. Nobody wanted to discover why. That was a sign of corruption. The scandal was forgotten and nobody found guilty for the crime.. The bubble party moved to the real estate and the banking sector for a few more years.. BUT.. when you hide or backsupport the criminals, the crimes continues..

In Paris, i tried to contact the politicians i hoped they cared. This time, i was not so lucky. I got no appointment.. But.. i found a similar system, like in Athens and Nicosia. Inequalities in Paris are too obvious. Too expensive accomodation cost, expensive transportation, average salaries.  Is France the next victim of the domino effect? It is extremely possible.. Why? A significant explanation is because they have too many homeless people. As i saw in Athens, back in 1995, nobody cared for homeless people. Nobody cared to find a solution for them, a house, a bed, a way to make them useful again even in order to help them start spending again. Paris in 2013 gave me the same picture as Athens in 1995. Many people live in luxury, other just handle it roughly. But.. if you lose your job, you are just another homeless guy and nobody cares about you.
Last shock was the collapse of Fagor. This was something i couldn't really imagine of although it is part of the domino effect. Having no extra money, having no savings, you have no luxury to buy a new fridge.. So.. since a country can't give a solution to simple problems like finding solution for the homeless people, what will do in a more complex situation as the increase of unemployment?

Don't think of it.. Because it is a nightmare scenario.. In my experience, people without strategy and vision eventually lead to a mess. Especially the "leaders".. So.. It's the time to find a solution for the problems or.. the time to expect the upcoming nightmare..

* Nicos Rafidhias, is a corporate consultant. He studied political science and international affairs and continues studying business administration. He is a member of the Cyprus Green Party and his personal positions are given to the party’s committees of Commerce and Tourism, Transportation, Communication and Finance. This article was written hoping that some "leaders" will read it..

Wednesday 23 October 2013

Managing failure..

Failure is something totally acceptable in life. Everyday, we fail in short term or long term period due to wrond decisions we take. They say that every failure teaches you how to become more successful. I believe it's more than correct because it gives you the wisdom to avoid the past mistakes. Failure for some other is a choice and a tradition. Analyzing the Greek Public sector, i remember that you could never find a solution on any of your problems. They never had a solution, so they were continuously creating more complex problems until they collapsed.

As an undergraduate student, i was studying at a University where you could finally earn a worthless paper. Nobody could find a serious job since nobody believed in the study we had chosen to follow. I used to say that i earned an extra toilet paper, although deeply inside of me i felt that i chose the most important studies of the world! If you can separate the difference between studying and buying the paper, you can predict the future of the countries and the whole political system as well. If you study and search for mistakes, inequalities and failure, you can finally understand what goes wrong, what must be changed, what will happen if not..

Cyprus never invested in lifelong studies or strategies, as well. As a postgraduate student, i was lucky and cursed to live the same issues once again, studying a new subject, just to spend my money in an institution that focused on increasing the number of alumni but not the critical mind. Very few really got the message of what they were studying. The majority (many of them coming from the public sector..) took an extra degree to get an extra increase in their salary. Nobody could see the upcoming bubble they were part of except myself and few others. Many are facing unemployment right now due to the perfect storm they caused..

A simple example of the creating bubbles was what happened in the banking sector in the recent years. Banks used to give extremely high deposit interest and ask even higher for the loans. Every depositor seemed to earn a good profit but the truth was that the banks had no healty sector to put all these deposits. The same time, the borrowers (mostly the companies) lost every competitive advantage they may had since every other company within the EU had lower borrowing costs. Imagine a pasta factory in Germany working with 3% loan interest, a Cypriot one working with 9% interest and a Greek one working with 12% interest. All of  them in euros, one currency with different interests! The result ? Someone will bankrupt shortly, a second one after a while and somebody will remain and sell their production all over Europe. That is what is really going on in the Eurozone today.. But how many do they get it ? Even after the domino effect that make the countries collapse..

Transparency is the major key for solution, among with innovation and entrepreneurship, for the success of the European idea. Wherever there is transparency (mostly in Northern Europe..) people live in prosperity or even better than the Souths. The absence of transparency is a sign that you should avoid this organization, company, sector or even, country. Cyprus chose anything else than transparency. Cyprus collapsed  because their leaders chose to remain to the past practices. If any other countries will follow the same strategy, we know the result.. Simple maths..

As an Erasmus student i now realize the European failure much more. A northern student is capable to come to Paris and rent an apartment for 1000. A southern one, comes only with the Erasmus grant (and only if given on time..) and few extra money. The first one is capable to remain because the cost is almost the same as in his country, the second one might have to leave due to the higher cost of living he finds here. Europe still has no strategy for the inequalities within as Greece and Paris have no strategy for their homeless people. If you can't or don't want to find a proper solution, the problem still exists and increases..European Union is closer to the separation as long as the national leaders don't realize what all these inequalities cause. Starting to find solutions for the homeless people and the Erasmus students might be the first step..

* Nicos Rafidhias, is a corporate consultant. He studied political science and international affairs and continues studying business administration. He is a member of the Cyprus Green Party and his personal positions are given to the party’s committees of Commerce and Tourism, Transportation, Communication and Finance. This article was written in Paris, hoping that some leaders will read it..

Saturday 23 March 2013

Is a new domino effect, born in Cyprus ?

These last days are quite interesting for both Cyprus and Europe. Cyprus faces a haircut on deposits, the possibility of losing the competitive advantages had as a business center and exiting the Eurozone. Why? Because for many years local governments were spending more than they should, without worrying for the consequences. A significant annual amount was going to the huge public sector for raises and other benefits in order to secure their vote for the following elections. Was that fair or logic? Of course not. Money is scarce, coming from the public and should be managed for the public prosperity. It seems that the Cyprus politicians were so interested in buying votes that they finally left the rest of the island’s people broke. And now, it’s time for Cypriot people to pay an enormous bill.

Unfortunately, it seems that many other European countries are facing common (and possibly) worse issues. Politicians all over Europe failed to work, in the recent years, for their people’s prosperity. Greece is another example, worse than Cyprus. Adopting a political system where presidency has no real authority, having a parliament for both voting laws and executing decisions (against the Montesquieu’s tripartite system), Greece had to pay much earlier than Cyprus the lack in democracy and transparency. Even Italy, seems to follow the same path.

Both financial and public sector in Cyprus (and Greece) need restructuring. We desperately have to enforce law and elect visionary leadership since we failed to do it in the past years. As a reporter mentioned yesterday, Cypriot politicians (and Greek) were so interested for their public picture (in Radio and TV channels) that they finally didn’t do the job they were paid for. It reminds me Italy too, isn’t it? Is Europe responsible for this? Of course..

I was at High School when Toto Cutugno was singing “Insieme”, a song inspiring for a united Europe. I was dreaming for the day i could go across Europe, without my passport. The time has came but when i finally went, i realised the poverty, inequalities have caused for the majority of the european people. Dream had become a nightmare.. European people invested in a common future where their leaders never cared, designed or invested for. This, allowed international investors to manipulate the different regulations between Euro countries and create a huge systemic gap, finally leading to collapse.

It’s a common secret that Cyprus, Greece and many other European countries have to re-invent their model and strategy in the common market. For example, you can’t invest only on tourism and services for Russians and offshore companies. You need a much wider dispersion, in several other sectors, giving job and security to as many people as you can and allowing the others to innovate and create sustainable companies. Cypriot inhabitants need to have equal rights to remain and work in their island, for their island. So do Greeks, Bulgarians, Romanians, Spanish, Italian and Portuguese. The failure and inequality of the common market has to be eliminated in every European place, otherwise the gap will finally shake and the rest of the Eurozone.
The domino effect has started in Greece, created the PIGS effect, now passing over Cyprus and goes directly to the last two pillars, France and Germany. We can’t expect prosperity in European territory where Bulgarians are forced to work in Cyprus, Cypriots to England and Spanish to Germany or France for minimum wages. Fair labour should become a right for everyone and everywhere across Europe. In the recent years, people from Greece, United Kingdom, Bulgaria and Romania came to Cyprus, seeking for a better future. Cyprus gave job to almost 100.000 people from Europe but now many of them and around 60.000 Cypriots have no job and they must seek for new jobs in other countries.
Cypriot politicians, have their own, huge responsibilities for this. Counting so much on the Russian, British and other foreign capitals, they paid no attention on education, investments, entrepreneurship and innovation, for the local sustainability. Even know, many of them send their savings to other destinations, just before they voted for the haircut. The same lack of public interest is proven to happened to Greece, Italy, Spain and Portugal. Many countries are facing the same consequences due to their national lack of leadership. Even Ireland, which was the entrepreneurial leader,  the last decade! What is going on?

Europe has to re-discover a new model for the following years. Today, we need a strong answer, whether we should proceed to a common market by enforcing common laws and minimizing any inequalities were caused or, whether we should go back to our national currencies. It is not possible or acceptable to force the European people pay for their leaders’ mistakes, personal interests or/and stupidity. Neither we can accept this financial and social deregulation take us back to 1929. European people are demanding for answers. Everybody should have the right and chances for education, work and prosperity.

Now, it is the time to end the lack of supervisory and the increasing deregulation wherever was created and send whoever is guilty to the jail. Cyprus authorities found no guilties after the Cyprus stock market collapsed in 2001, vanishing billions of euros. What was saved then, having no other alternatives, was driven to the real estate sector, building a greater bubble. Now, we have pay the bill for those years. Billions of euros are also expected to leave Cyprus for other offshore destinations. I strongly believe that this is the least. A new systemic danger will occur because new territories are expected to welcome all these money and possibly repeat Cyprus’ mistakes.

After the years, where a common Europe was our dream, we discovered that today’s Europe has nothing common with what we expected. We have a place where the winners take everything and leave chaos for the rest. It is, today,  the time for Europe to create equal rules and measures for the European people, for the common future. If our leaders don’t or won’t, maybe it is the time for Europeans to return to their national currency and fight for their personal and national prosperity..

* Nicos Rafidhias, is a corporate consultant. He studied political science and international affairs and continues studying business administration. He is a member of the Cyprus Green Party and his personal positions are given to the party’s committees of Commerce and Tourism, Transportation, Communication and Finance.