Merkel admits mistakes as anti-migrant party surges in Berlin

File: In an unusually frank opening statement, German Chancellor Angela Merkel pledged Monday that there would be no repeat of last year's "chaotic" border opening to refugees, after a stinging loss for her party in Berlin elections. 

BERLIN- German Chancellor Angela Merkel pledged Monday that there would be no repeat of last year's "chaotic" border opening to refugees, after a stinging loss for her party in Berlin elections.

Even as she defended the "political and ethical" decision to let in one million asylum seekers in 2015 in the face of a potential humanitarian catastrophe, Merkel admitted mistakes that she would avoid in future.

"If I could, I would turn back time many, many years to better prepare myself, the federal government and all those in positions of responsibility for the situation we were rather unprepared for in the late summer of 2015," Merkel said.

Merkel, who has been in office since 2005, was speaking to reporters after a dismal showing for her conservative Christian Democrats in Berlin state elections Sunday, two weeks after a drubbing for the party in another regional poll.

READ: German Chancellor beaten by anti-immigrant party in her home district

In an unusually frank opening statement, Merkel said the errors included a long-standing refusal to accept Germany's transformation in the postwar decades into a multicultural society.

"We weren't exactly the world champions in integration before the refugee influx," she wryly admitted, noting that the infrastructure for getting newcomers into language and job training had had to be ramped up overnight.

In the Berlin election, the right-wing populist Alternative for Germany (AfD) harnessed a wave of anger over the refugee influx to claim around 14 percent of the vote.

Merkel's CDU slumped to just 18 percent -- its worst post-war result in the city -- likely spelling the end of its term as junior coalition partner to the Social Democrats (SPD), who won just under 22 percent.

She acknowledged that her "We can do this" rallying cry during the refugee crisis had become a provocation to many who felt it expressed a glibness about the challenges ahead and said she would now refrain from using it.

But she continued to resist calls from within her conservative bloc to set a formal upper limit for the number of asylum seekers admitted to Germany.

And she struck an optimistic note about the ability of Europe's top economic power to eventually integrate tens of thousands of refugees who stay in Germany, including many from war-ravaged Syria.

"I am absolutely certain that we will emerge from this admittedly complicated phase better than we went into it," she said.

Deutsche Bank to fight $14 billion demand from US authorities

Deutsche Bank's problems are likely to alarm political leaders in Europe's largest economy and the home to the European Central Bank.

FRANKFURT - Deutsche Bank said it would fight a $14 billion (R200 billion) demand from the US Department of Justice to settle claims it missold mortgage-backed securities, a shock bill that raises questions about the future of Germany's largest lender.

The claim against Deutsche, which is likely to trigger several months of talks, far exceeds the bank's expectations that the DoJ would be looking for a figure of only up to 3 billion euros ($3.4 billion / R48.5 billion)).

The demand adds to the problems facing Deutsche Bank's Chief Executive John Cryan, a Briton who has been in the job for a year.

READ: Reserve Bank fines Deutsche Bank and Capitec

The bank only scraped through European stress tests in July and has warned it may need deeper cost cuts to turn itself around after revenue fell sharply in the second quarter due to challenging markets and low interest rates.

Deutsche Bank shares, which have lost around half their value this year, tumbled 7.6 percent to 12.10 euros in Frankfurt on Friday, with analysts saying the bank may need to raise fresh funds from investors or sell assets to shore up its capital ratios.

The cost of insuring Deutsche Bank debt against default rose by around eight percent.

The bank, which employs around 100,000 people, said it regarded the DoJ demand as an opening shot.

"Deutsche Bank has no intent to settle these potential civil claims anywhere near the number cited," it said in a statement.

"The negotiations are only just beginning. The bank expects that they will lead to an outcome similar to those of peer banks which have settled at materially lower amounts."

Analysts said that even a hefty reduction in the bill was likely to weigh heavily on Deutsche Bank's finances.

"If the final bill is at 5 billion euros or more Deutsche Bank will not be able to avoid a capital hike anymore," said Ingo Frommen, banking analyst at LBBW.

Political backing?

Deutsche Bank's problems are likely to alarm political leaders in Europe's largest economy and the home to the European Central Bank.

The German finance ministry said on Friday that the government expected a "fair result" from the negotiations but that the talks were a matter for the bank and the American authorities.

Finance minister Wolfgang Schaeuble took the unusual step of voicing public support for the bank earlier this year and a senior opposition figure said he expected the government to step in as a last resort if needed.

"The question would be how much damage would it do to the economy if the bank were to topple," said Green Party financial spokesman Gerhard Schick.

The DoJ has taken a tough stance in settlement negotiations with other banks, requesting sums higher than the eventual fine.

A recent European Union ruling that Apple must pay up to 13 billion euros in taxes to the Irish government and the forthcoming US election could complicate Deutsche Bank's efforts to whittle down the demand.

One of Deutsche's top 10 investors said he expected the bank to have to pay 4-5.5 billion euros for the mortgages case. "But because of the election campaign it may end up higher - at maybe 6 or 7 billion."

In 2014, the DoJ asked Citigroup to pay $12 billion to resolve an investigation into the sale of shoddy mortgage-backed securities, sources said. The fine eventually came in at $7 billion.

In a similar case, rival Goldman Sachs agreed in April to pay $5.06 billion to settle claims that it misled mortgage bond investors during the financial crisis.

Deutsche Bank's settlement will comprise a different list of recipients from the Goldman case, a source close to the matter said, adding that the lender had already settled some claims three years ago.

In late 2013, Deutsche Bank agreed to pay $1.9 billion to settle claims that it defrauded US government-controlled Fannie Mae and Freddie Mac, America's biggest providers of housing finance, into buying $14.2 billion in mortgage-backed securities before the 2008 financial crisis.

List of legal problems

A $14 billion fine, or even half that sum, would still rank among one of the largest paid by banks to US authorities in recent years.

Deutsche Bank has not said what it has set aside in anticipation of a settlement over the sale and packaging of resident mortgage-backed securities before 2008.

Its overall legal provisions stood at 5.5 billion euros at the end of June, and according to a person close to the bank 2.5-3 billion of that had been reserved for the mortgages case.

Deutsche was once one of Europe's most successful players on Wall Street. Like many of its peers, it has since faced a slew of lawsuits that often trace back to the boom years before the crash. Its litigation bill since 2012 has already hit more than 12 billion euros.

Claims filed by individuals, companies and regulators against Deutsche, outlined in the bank's 2015 annual report, relate to mis-selling of subprime loans and alleged manipulation of foreign exchange rates or gold and silver prices. Other lawsuits are for the rigging of borrowing benchmarks Libor and Euribor, used to set the price of mortgages and derivatives.

In July, Chief Executive Cryan said he hoped to close the four largest remaining litigation cases this year.

These are the mortgages and FX cases, an investigation into suspicious equities trades in Russia and allegations of money laundering.

Britain approves nuclear plant, easing Chinese, French ties

File: Theresa May's govt. said it decided to proceed with the Hinkley Point C project in central England after comprehensive review, but Britain would have greater control over future deals when foreign states buy stakes in "critical infrastructure" 

LONDON - Britain gave the go head on Thursday for a $24 billion nuclear power plant, ending weeks of uncertainty that strained ties with China and France and put a question mark over Prime Minister Theresa May's investment policy.

In a statement, her government said it had decided to proceed with the Hinkley Point C project in central England after a comprehensive review, but was clear Britain would have greater control over future deals when foreign states were involved in buying stakes in "critical infrastructure".

May stunned investors by putting Hinkley on hold in July, just hours before a deal was to be signed, saying she needed time to asses the project that would see French utility firm EDF  build Britain's first new nuclear reactor in decades, backed by $8 billion of Chinese cash.

READ: France finalising UK nuclear plant deal: Minister

"Having thoroughly reviewed the proposal for Hinkley Point C, we will introduce a series of measures to enhance security and will ensure Hinkley cannot change hands without the government's agreement," Greg Clark, business minister, said in a statement.

"Consequently, we have decided to proceed with the first new nuclear power station for a generation."

Critics of the deal had expected Britain to try to renegotiate the price, which they say was set too high before oil prices fell dragging energy costs lower, but the statement said the price the government will pay for the energy had not changed.

An aide to Francois Hollande said May had called French president personally to say "she supported the launch of the Hinkley project".

She will no doubt also move quickly to ease tension with China, which had called for Britain to proceed with the project immediately after the review was announced.

China's Foreign Ministry did not immediately respond to a request for comment. China on Thursday began a three-day national holiday.

Britain to start building anti-migrant wall in Calais

Britain is to start building a wall in the northern French port of Calais to stop migrants jumping on trucks, under a deal agreed earlier this year, the interior ministry said on Wednesday.

The four-metre high, one-kilometre long barrier will be built on a port approach road starting this month and should be completed by the end of this year, officials said.

The wall, which will be funded by the British government under an agreement struck at a summit in March, will complement a security fence already put up around the port and entrance to the Channel Tunnel.

"We are going to start building this big new wall very soon. We've done the fence, now we are doing a wall," junior minister Robert Goodwill told a parliamentary committee on Tuesday.

The wall, which is expected to cost 2.7 million euros ($3.0 million), will be the latest barrier to go up around Europe as the continent struggles with its biggest migrant influx in decades.

Hungary has built a reinforced fence on its frontier with Serbia and Austria has announced plans for a massive new fence along its border with Hungary in a bid to shut down the Balkan migrant route.

Republican White House hopeful Donald Trump has said he plans to build a wall along the border with Mexico funded by the Mexican government if he is elected.

The wall in Calais was agreed following tens of thousands of attempted Channel crossings last year through trucks boarding ferries and the Eurotunnel.

Angry French truckers and farmers blocked the main routes in and out of Calais on Monday to call for the closure of the sprawling "Jungle" migrant camp.

The Jungle, a squalid camp of tents and makeshift shelters, is home to some 7,000 migrants but charities say the number might be as high as 10,000 after an influx this summer.

Migrants from the camp sometimes use tree branches to create roadblocks to slow trucks heading for Britain, their destination of choice.

When the trucks slow down, migrants try to clamber into the trailers to stow away aboard.

Drivers say migrants and people trafficking gangs have attacked their vehicles with metal bars.

The drivers say despite the deployment of 2,100 officers around the port, the police are overstretched and unable to secure the roads.

French Interior Minister Bernard Cazeneuve promised during a visit to the Jungle last week to close the camp down "as quickly as possible" but said it would be done in stages.

UN says Austria risks breaking 'taboo' on refugees

The UN refugee agency said Wednesday Austria is in danger of breaking a decades-old tradition of helping those in need, after Vienna moved a step closer to potentially shutting its borders to migrants.

"Since World War II, Austria has always adhered to the tradition of protecting refugees. Access to the asylum process has always been a matter of course," said Christoph Pinter, head of UNHCR in Austria.

But the new plans "would represent the breaking of a taboo and a retreat from the protection of refugees," Pinter said in a statement.

On Tuesday, the governing coalition agreed on a draft emergency decree that, once it enters into force, would allow Austria to block the entry of migrants directly at its borders.

Chancellor Christian Kern said Tuesday that the decree would be applied once the government's upper limit of 37,500 asylum applications for this year is reached.

The draft decree remains at least several weeks from being ready to come into force and could face legal challenges, including at EU level. How the border closures would work in practice also remain unclear.

Austria received a record 90,000 asylum applications in 2015, when hundreds of thousands of migrants, many fleeing conflict in the Middle East, entered Europe.

Austria's far-right Freedom Party (FPOe), echoing populist parties elsewhere, has stoked concerns about the new arrivals to boost support, putting Kern under pressure to act.

On October 2, the FPOe's Norbert Hofer stands a good chance of being elected as Europe's first far-right president since 1945, although in Austria the job is largely ceremonial.

Denmark to pay for Panama Papers data on tax evaders

The Danish government said on Wednesday it would pay an anonymous source for leaked data from the Panama Papers on hundreds of Danish taxpayers.

"We cannot be sure of the end result, but everything suggests that it is useful information that the Danish tax authority will now pursue.""We must use the necessary measures to catch the tax evaders hiding fortunes in for example Panama with the aim to avoid paying tax in Denmark," Minister for Taxation Karsten Lauritzen said in a statement.

The government would pay the source an amount in the "lower millions" of kroner (one million kroner is 134,000 euros, $151,000) for the material, which it estimated could contain information on 320 cases involving between 500 and 600 Danish taxpayers.

The Danish tax authority had already received a "sample" of the data free of charge, the Ministry of Taxation said.

"Against this backdrop it is the tax authority's assessment that the information is sufficiently relevant and valid to initiate tax investigations of a number of the companies and individuals appearing in the material," it said.

Torben Bagge, a lawyer teaching tax law at Aarhus University, noted that Denmark did not "have a tradition of buying information", and cautioned that there was no guarantee that it would be accurate.

Those selling it had "probably not obtained it legally", meaning the government was "in one way or another contributing to illegalities," he told Danish news agency Ritzau.

In April, media outlets published details of murky offshore financial dealings gleaned from 11.5 million leaked documents from a Panamanian law firm -- the so-called "Panama Papers."

The leaks put a host of high-profile politicians, celebrities and sports stars in the hot seat over their assets in tax havens.

May warns of 'difficult times' for UK economy

Speaking to BBC television, May also ruled out a new general election anytime soon, saying Britain needed stability following June's referendum vote to pull out of the European Union.Prime Minister Theresa May warned of possible "difficult times ahead" for Britain's economy in an interview screened Sunday as she sought to build post-Brexit trade ties at the G20 summit in China.

She voiced optimism about the health of Britain's economy but warned that there could be tough times ahead.

"I'm not going to pretend that it's all going to be plain sailing," she said. "I think we must be prepared for the fact that there may be some difficult times ahead. But what I am is optimistic."

• British PM to trigger EU pull-out 'without parliament vote' 

May, who took office in July after David Cameron quit following the referendum, also confirmed Downing Street briefings that she is not intending to call a general election soon.

This is despite the ruling Conservative party having only a small majority in the House of Commons, which could make it hard to pass controversial laws, and Jeremy Corbyn's deeply divided opposition Labour lagging in opinion polls and holding a leadership contest.

"I'm not going to be calling a snap election," May said.

"I've been very clear that I think we need that period of time, that stability, to be able to deal with the issues that the country is facing and have that election in 2020."

• Brexit could be delayed to late-2019 as government not ready 

May is meeting world leaders including US President Barack Obama and China's Xi Jinping at the G20 summit.

She told the BBC she wanted to "start to scope out" with them how future trade deals would look post-Brexit.

But Obama spoke out strongly against Brexit during the referendum campaign, warning Britons they would go "to the back of the queue" for a US trade deal if they voted to leave.

European Commission chief Jean-Claude Juncker also said Sunday he opposes trade negotiations between Britain and other nations while it remains part of the bloc after Australia said it was about to launch talks on the issue.

Half of Germans against Merkel serving fourth term -poll

German Chancellor Angela Merkel's domestic popularity has declined, a poll showed on Sunday, with 50 percent of Germans against her serving a fourth term in office after a federal election next year.

A series of violent attacks on civilians in July, two of which were claimed by Islamic State, have focused attention on Merkel's open-door migrant policy, which allowed hundreds of thousands of migrants from the Middle East, Africa and elsewhere into Germany last year.

Half of the 501 people questioned in the Emnid poll for the Bild am Sonntag newspaper were against Merkel staying in office beyond after the 2017 election, with 42 percent wanting her to remain.

In November, the last time Bild am Sonntag commissioned a survey on the issue, 45 percent had been in favour of Merkel serving a fourth term, with 48 percent against.

The head of Germany's Federal Office for Migration and Refugees (BAMF), Frank-Juergen Weise, told the newspaper that he expects a maximum of 300,000 refugees to arrive in Germany this year.

Merkel, asked about her plans for the 2017 election in an interview with regional newspapers published on Tuesday, said: "I will comment on that at the appropriate time. I'm sticking to that."

Earthquake hit the central city of Italy.

Numerous buildings collapsed in small communities close to the epicentre of the quake in a remote, thinly-populated area straddling the regions of Umbria, Marche and Lazio.

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Shallow 6.2 quake shakes Rome, 'destroys' town in central #Italyhttp://on.rt.com/7ne0  #ItalyEarthquake

6:58 AM - 24 Aug 2016

 
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As dawn broke, residents and emergency services were scrambling to rescue people trapped in rubble. Local officials indicated that the death toll was likely to rise.

Fabrizio Curcio, the head of Italy's civil protection service, classed the quake as "severe". The shocks were strong enough to wake residents of central Rome, some 150 kilometres (90 miles) away.

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Strong earthquake hits central #Italy, brings down buildingshttp://reut.rs/2be0PF7 

5:27 AM - 24 Aug 2016

Quake brings down buildings in central Italy, at least 10 believed killed

A strong earthquake brought down buildings in mountainous central Italy early on Wednesday, trapping residents and sending others fleeing into the streets, with at least 10 people believed killed.

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The first two confirmed victims were an elderly couple whose home collapsed in Pescara del Tronto in the Marche region, according to local police.

Aleandro Petrucci, the mayor of nearby Arquata del Tronto, said Pescara was one of "two or three hamlets that have just completely disintegrated."

Another person died and a family of four including two young children were trapped, feared dead, in their collapsed house in Accumoli, according to its mayor.

"We have a tragedy here," the mayor, Stefano Petrucci, said. "For the moment one death is confirmed but there are another four people under the rubble and they are not responding.

A general view following an earthquake in Amatrice, central Italy, is seen in this August 24, 2016 handout picture provided by Italy's Fire Fighters.

"It is a disaster, we have no light, no telephones, the rescue services have not got here yet."

A resident of the village told Rai that she had been woken by the shaking in time to witness the wall of her bedroom cracking open. She was able to escape into the street with her children.

Two corpses were recovered from rubble in Amatrice, a mountain village in neighbouring Lazio that was packed with visitors at the peak of the summer season.

"Half the village has disappeared," said Sergio Pirozzi, Amatrice's mayor.

He said access to the village had been blocked, making it impossible for emergency services to get through.

"There is a landslide on one road, a bridge is about to collapse on the other one," he said, according to the AGI news agency.

"We can hear voices under the rubble."

Amatrice is famous in Italy as a beauty spot and is a popular holiday destination for Romans seeking cool mountain air at the height of the summer.

The first quake struck shortly after 3.30 am (0130 GMT), according to the United States Geological Survey, and a 5.4 magnitude aftershock followed an hour later.

USGS's PAGER system, which predicts the impact of earthquakes, issued a red alert -- suggesting significant casualties and damage based on previous quake data.

A resident of the Rieti region, which is between Rome and the epicentre of the quake, told the Rainews24 channel that she and most of her neighbours had come out onto the street after feeling "very strong shaking".

In 2009 a 6.3-magnitude earthquake struck close to the city of Aquila in the Abruzzo region and left more than 300 people dead.

That disaster led to lengthy recriminations over lax building controls and the failure of authorities to warn residents that a quake could be imminent.

Italy is often shaken by earthquakes, usually centred on the mountainous spine of the boot-shaped country.

Another quake hit the northern Emilia Romagna region in May 2012, when two violent shocks 10 days apart left 23 people dead and 14,000 others homeless.