ECONOMY

In Brief

‘Very, very low’ risk of Greece, Spain defaulting LONDON (AFP) – The head of British insurer Aviva yesterday said there was a «very, very low» risk that Greece, Spain or Portugal would default on government debt. CEO Andrew Moss, speaking to reporters after Aviva gave a trading update, said the risk of default was «unequivocally very, very low in our view.» The comments come after the European Union and the International Monetary Fund gave their backing to a 1-trillion-dollar (750-billion-euro) rescue package for crisis-hit euro countries to prevent contagion from Greece. «It has been clear some European countries’ budget deficits need to be resolved over time,» Moss said. «Therefore, seeing action with the larger countries in the European Union standing behind sovereign debt at this point is helpful, but the reality is that some of these countries would have to take action within their own economies to address their issues.» In the trading update, Aviva said its total exposure to debt securities from the governments of Greece, Spain and Portugal stood at 900 million pounds (1.16 billion euros, $1.33 billion), with Greek securities accounting for 150 million pounds. Albania hopes to complete eurobond debut next week TIRANA (Reuters) – Albania is hoping to complete its debut eurobond offering of 300-400 million euros by the end of next week, the finance minister said yesterday, following a delay caused by the Greek financial crisis. «We are not so sure if it will be after two days or after one week. We are interested to close this transaction,» Ridvan Bode told Reuters in an interview. «The end of next week will be the last date I think.» Albania, a NATO member and European Union applicant country, finished its eurobond road show that included London, Vienna, Munich and Frankfurt on April 26. But it delayed plans to issue the three- to five-year duration eurobond immediately afterward as the worsening crisis in neighboring Greece alarmed markets. «We are now in the process of waiting for the eurobond,» he said. «For us it was optimistic, but now, after the Greek situation and other countries, I think we have some difficulties but we remain in the market. For us when it will be the appropriate time, we will go in the market.» Albanian officials would like to complete the offering by May 28, when about 10 million euros in interest payments are due on a 192.6-million-euro commercial loan. The ex-Communist country would like to pay off that loan in its entirety with eurobond proceeds, as it must pay about 11 percent annual interest in an expensive deal made a year ago. Rate cut Serbia’s central bank yesterday said it had cut its key rate to 8.0 percent in the face of lower-than-expected inflation. «The National Bank of Serbia’s monetary policy committee concluded that inflation was still below the lowest targeted level and that such a trend would continue in the coming period,» the statement said. Therefore «the committee decided to lower the interest rate by a half a point» from 8.5 percent, it added. «Low domestic demand and the slow recovery of both the global and domestic economy will have noninflationary effects in the future period of time,» it said. (AFP) Energy rules Spain and its Mediterranean neighbors must provide consistent rules for investors if they are to achieve their renewable energy goals, according to a European Union official. «Investors need clarity and predictability as regards a wide range of issues,» Fabrizio Barbaso, assistant director general of the European Commission’s Energy Directorate, told a conference in Valencia, Spain. The Spanish government fueled a cycle of boom and bust the past three years as it shifted the incentives for solar power investors. Producers had pumped more than 18 billion euros ($23 billion) into new solar plants since 2008 after Spain introduced a subsidy regime that paid them more than 10 times the wholesale power price. Investors yanked their support for Spain’s solar industry this year when the Industry Ministry said it may cut those prices, which Renovalia Energy SA president Juan Domingo Ortega said he had expected his existing plants to enjoy for 25 years. (Bloomberg)