Abandoned Budapest Hospital Offers Glimpse into Soviet Past

Time stands still in a former Soviet military hospital in Budapest that was abandoned when the last Russian troops left Hungary in 1991.

Soldiers wounded in Afghanistan were among those treated here. Now the 70,000 square meter (17 acre) complex lies derelict — its walls crumbling, its floors torn up, its windows broken.

Traces of the Russian presence are everywhere. In one of the apartments where doctors and soldiers lived with their families, a copy of the Russian newspaper Komsomolskaya Pravda has been left behind.

It dates from Nov. 20, 1988, and the front page details a visit by Mikhail Gorbachev to India — a memento of the final years of communism under the last leader of the Soviet Union.

In one room, health records and empty medicine bottles lie scattered on the floor. A document reveals that a Russian soldier named Sergei G., who was born in 1962 and served as a driver, was brought to the hospital in 1983 with severe burns on his hands and neck.

It is not clear whether his wounds were from the war in Afghanistan, which the Soviet Union invaded in 1979, or what eventually became of him.

First opened in 1904 as a private mental institution, the Art Nouveau hospital was occupied by the Red Army as it advanced against the Nazis in 1945. New buildings, including a huge surgery department, were added later.

Now they are eerily quiet, with only pigeons flying in and out. Water drips from the ceilings of the operating theaters.

With the fall of communism across Eastern Europe and the collapse of the Warsaw Pact military alliance, Moscow brought home its troops from around the region.

But Laszlo Hajdu, 69, mayor of the Budapest district where the hospital is located, said that in 1991 the Hungarian government was not willing to pay the Russians compensation for what they had invested in the hospital.

“They packed everything in rail carriages and left the bare walls to us,” Hajdu told Reuters. “We said farewell to them in June 1991 with vodka, according to Russian customs, and they left in tears. … I was there when we took over the buildings.”

That marked the start of a long saga of changing ownership rights and searches, still unresolved, to find new investors.

Locals still remember the days when they lived next to the Soviet military complex.

“Soldiers were treated here, there was a tall white stone wall surrounding the buildings and they peeked over the fence. … We were not allowed into the territory of the hospital,” said Margit Arkos, 63.

“When they left, there was a big sale, nearly everyone living around here bought chairs, sofas,” she said. “It’s incredible that nearly 30 years have passed, and they have still not been able to decide what should happen to this hospital.”

Brazil’s Labor Reform Vote in Senate Put Off Until Next Week

The Brazilian government decided on Tuesday to wait until next week to put a bill modernizing labor laws to a vote in the Senate Economic Affairs Committee, its leader in the upper chamber, Senator Romero Jucá, said.

Speaking earlier at an investment forum in Sao Paulo, Budget and Planning Minister Dyogo Oliveira said the bill that will lower labor costs for businesses would clear the Senate this week and be ready for President Michel Temer to sign into law.

The bill, which has already been approved by the lower house, has faced fierce opposition from labor unions that will lose power over workplaces. It also allows more temporary work contracts and outsourcing, eliminating mandatory union dues.

Leftist parties in Congress had vowed to obstruct a vote in the Senate committee where it will be debated this Tuesday.

The vote will take place next Tuesday, said Juca, who leads the coalition of pro-government parties in the Senate. He said the reason to postpone the vote was to avoid a “battle over procedures” in the committee.

Quick passage of the labor reform bill was important for the government to show that its reform agenda aimed at restoring economic growth and business confidence is on track.

Temer’s main proposal for reducing Brazil’s gaping budget deficit is reform of the costly pension system.

But its progress in the legislature has been slowed down by the political crisis sparked by allegations that the president condoned corruption. The fate of the unpopular measure is uncertain.

Five Policemen Killed in Mexico Ambush Ahead of Key State Vote

Five Mexican police officers were shot dead on Tuesday in an ambush in the State of Mexico, where elections at the weekend will serve as an early referendum on the ruling party ahead of a 2018 presidential vote.

The police officers were responding to a call in Ecatepec, a sprawling suburb of Mexico City, early on Tuesday morning when unknown assailants opened fire on them, said an official in the state prosecutor’s office who was not authorized to speak publicly.

The Ecatepec mayor’s office said in a statement three police officers died at the scene, while two more died of their injuries. All five of the slain officers were men.

Ecatepec is among Mexico’s most dangerous urban areas, with various local gangs fighting over drug, prostitution and extortion rackets.

Sunday’s gubernatorial election in the State of Mexico could bring an end to almost nine decades of rule by President Enrique Pena Nieto’s Institutional Revolutionary Party (PRI) in Mexico’s most populous region, where 16 million people live.

Losing the state would put a big dent in the PRI’s hopes of retaining the presidency next year.

Opinion polls show the National Regeneration Movement (MORENA), the new party of veteran leftist Andres Manuel Lopez Obrador, could capture the state, which would ramp up the momentum for his bid to succeed Pena Nieto in 2018.

Pena Nieto is barred by law from seeking re-election.

Android Creator Unveils New Phone, Home Assistant Device

Andy Rubin, the co-creator of the Android mobile phone operating system, has launched a new company called Essential Products to sell a high-end smartphone and a home assistant device.

Palo Alto-based Essential said the new Essential Phone features an edge-to-edge screen, a titanium-and-ceramic case and dual cameras. The phone sells for $699 and will run the Android operating system. The price pits it against high-end smartphones including Apple Inc’s iPhone and Samsung’s Galaxy S8.

Essential also launched a household assistant called Home that looks like an angled hockey puck with a screen. The device will compete against the Amazon.com Echo and Alphabet’s Google Home speaker, which are powered by the Alexa and the Google Assistant voice services respectively.

Essential confirmed the Home device will let the user choose between Alexa, Google Assistant or Siri. It was not immediately clear how Siri would be available on Essential. While Amazon and Google have released the software needed to embed their assistants on devices they do not make, Apple has not done so.

Essential declined to elaborate on how it plans to embed Siri on the device, and Apple declined to comment.

The Essential Home takes a page from Apple’s privacy play book. Like an iPhone, the Home will do much of the processing for voice and image recognition on the device itself rather than sending data to remote servers.

Essential also said the Home device will communicate with home appliances like lights and thermostats directly over the home network, rather than sending data to remote servers.

Apple’s HomeKit system takes similar approach. Rubin, Essential’s CEO, co-founded Android and sold it to Google in 2005. He ran Google’s mobile efforts until 2013 before a brief stint running the firm’s robotics division. He left Google in 2014 to focus on starting hardware companies. Investors in Essential include Chinese tech company Tencent Holdings, iPhone contract manufacturer Foxconn, Redpoint Ventures and Altimeter Capital.

Essential plans to announce a ship date for the devices in the next few weeks. The company did not say whether it planned to sell the phone directly to customers online or in physical stores.

Essential for the first time revealed its staff on its website, listing Wolfgang Muller as head of channel sales.

Muller previously ran North American retail operations for phone maker HTC, according to his LinkedIn profile, suggesting that Essential plans to sell phones through retail stores, carriers or both.

Turkey at Loggerheads With Allies Over Key Airbase

Attention is growing on Turkey’s relationship with key NATO allies because of an increasingly acrimonious fight over the use of its Incirlik airbase.

Ankara and Berlin remain at loggerheads over German lawmakers being blocked from visiting their soldiers operating at the base.  

“It’s a legitimate right from the German point of view and that is something Ankara is missing,” points out former Turkish ambassador Unal Cevikoz, now president of the Ankara Policy Center, research organization.  “I understand at the meeting in Brussels between Chancellor [Angela] Merkel and President [Recep Tayyip] Erdogan [in May] the matter was seriously discussed.”

The blocking of German lawmakers to Incirlik follows Berlin’s refusal to extradite to Turkey suspects in July’s coup attempt.  Bilateral tensions soared this month with Germany granting asylum to more than 200 Turkish diplomats and military personal wanted by Turkish authorities.  The two sides are in talks to resolve the impasse.  

“I have seen some hints that Turkey will be looking at this issue favorably,” predicts former Turkish ambassador Cevikoz.

‘Blackmail’ won’t work

Germany has deployed reconnaissance planes to Incirlik as part of international efforts against Islamic State.  The vast base, located close to the Syrian and Iraqi borders, is widely seen as crucial in the war against the jihadists.  But this month German Foreign Minister Sigma Gabriel warned Berlin is prepared to relocate its forces.  Jordan is widely touted as an alternative.

“It’s not if, but when, and that ‘when’ will happen quite soon,” warns former senior Turkish diplomat Aydin Selcen, who served widely across the region and is now an analyst.

“It’s up to them, we will not beg them (to stay),” Turkish Foreign Minister Mevlut Cavusoglu said, claiming Berlin’s threat to withdraw is “blackmail.”

Key logistics hub

Repercussions from the German-Turkish dispute could add to growing unease in Washington.  U.S. forces are the primary foreign users of Incirlik in its war against the Islamic State, as well as using it as a key logistics hub.  

But Ankara has tried to use that dependency as leverage in its dispute with Washington over its military support of the Syrian Kurdish militia the YPG in fighting Islamic State.  Ankara calls the YPG terrorists, claiming they are affiliated with the PKK, which is fighting the Turkish state.

“There is high anti-Americanism in Turkey,” observes Sinan Ulgen, a visiting scholar at the Carnegie Institute in Europe.  “There has been talk of restricting use of Incirlik, other than Incirlik there are few areas that Ankara could really undermine the U.S. position.”

“The refusal of Turkey’s suggestion to avoid using the PKK/PYD/YPG in the Raqqa operation is unacceptable hypocrisy,” thundered Devlet Bahceli, leader of the National Action Party, in parliament Tuesday.  Bahceli is a key backer of Erdogan, who has an eye on his 2019 presidential re-election bid.

A balancing act

Ankara’s use of Incirlik as leverage on its allies, in particular Washington, analysts claim is a balancing act, extracting maximum concessions, but avoiding a withdrawal.  

“I don’t think Turkish policy makers want to go there really, (to U.S. withdrawal),” claims analyst Ulgen.  But the dispute with Berlin over Incirlik’s use, could add impetus in Washington to reassess its own dependency.

“The [U.S.] movements of planes from Incirlik are now reduced to earlier periods. This sends a strong signal to Ankara, that Incirlik is not indispensable,” warns former diplomat Aydin. “But lets not forget there are some quarters in Ankara, whether among officials or politicians, who will rejoice if that day comes and the U.S. decides to move out of Incirlik all together.”  

Not just a military airbase

The cost to Ankara of its allies abandoning Incirlik could be immediate and considerable.  “Incirlik is not just a military airbase used by our allies, its also important for intelligence purposes,” points out research organization head Cevikoz. “The intelligence German and U.S. experts secure are also shared with Turkey and this intelligence is absolutely necessary for Turkey’s fighting against the PKK terrorism.”

Turkish policy makers comfort themselves in knowing that finding an alternative to Incirlik has proved illusive to the United States.  Analysts point out no one base can match Incirlik, but a combination of airbases belonging to the semi-autonomous Iraqi Kurdistan Regional Government, along with small airstrips in Syria controlled by the YPG, could offer an alternative.

Such a step could have far reaching consequences.

“It will underline the fact Turkey is not a strategic partner anymore for the other members of the coalition,” warns analyst Aydin.  “But looking at the map, the geographical size of Turkey and its location, Turkey will still remain indispensable in the fight against ISIS.”

Cyprus President Rebukes UN Envoy for Gas Search Comment

The president of Cyprus on Tuesday rebuked a United Nations envoy for speaking of a possible crisis over the ethnically divided country’s search for offshore oil and gas, calling the remark “unacceptable” and a “threat” amid faltering reunification talks.

The envoy, Espen Barth Eide, was quoted in the Greek newspaper To Vima as expressing concern about the issue. In similar remarks earlier this month, Eide said an “international crisis” could lead to a collapse of the ongoing talks aiming at reunifying Cyprus as a federation.

“I regret that I’m being harsh about it, but I’ve made complaints directly that I consider such remarks unacceptable, especially if they’re made in the form of a threat,” President Nicos Anastasiades told reporters.

It’s the second time this month that Anastasiades, a Greek Cypriot, has leveled strong criticism at Eide, accusing him of bias.

Turkey and the Cypriot government are sharply divided over the energy search.

Cyprus was split in 1974 when Turkey invaded in the wake of a coup mounted by supporters of union with Greece.

Turkey, which doesn’t recognize Cyprus as a state, opposes what it calls a unilateral Greek Cypriot project which flouts the rights of breakaway Turkish Cypriots. In March, the Turkish Foreign Ministry warned that it would “take all necessary measures to protect its interests” in the eastern Mediterranean, as well as those of the Turkish Cypriots. Turkey is also said to claim part of gas exploration areas, or blocks, off Cyprus’ western and southern coast.

French energy company Total is scheduled to drill an exploratory well off Cyprus’ southern coast in mid-July.

Peace talks are at a standstill after Eide called off mediation efforts last week when Anastasiades and Turkish Cypriot leader Mustafa Akinci failed to find common ground on holding a final summit in Geneva, Switzerland. Anastasiades insists on prioritizing at the summit an agreement on withdrawing more than 35,000 troops that Turkey has kept in the island’s breakaway north since 1974. Akinci maintains that all issues should be discussed in a give-and-take process.

Anastasiades said Tuesday there would be no point to a Geneva summit if Turkey isn’t ready to discuss the security issue.

Ex-Gitmo Inmate Among 6 Detained from French Jihadi Network

A French judicial source says a former Guantanamo Bay inmate is among six people from an alleged jihadi recruiting network linked to the Islamic State group who have been detained.

The official said Tuesday that the suspects arrested in Bordeaux included Sabir Mahfouz Lahmar, who was freed from the U.S. detention center in Cuba in 2009 after France agreed to accept him.

The official spoke on condition of anonymity to discuss the case.

Lahmar was one of six Algerians detained in Bosnia in 2001 on suspicion of plotting to bomb the U.S. embassy in Sarajevo. The Justice Department later backed off the allegations, but held the men at Guantanamo for years.

The French official said Lamar, at age 48, is the oldest of the group of four men and two women arrested.

BA Debacle Puts Spotlight on Airlines’ Old IT Systems, Cuts

The catastrophic IT failure at British Airways that ruined travel plans for 75,000 people has raised questions about some older airlines’ focus on costs to the detriment of investment in new computer systems.

As British Airways resumed full service Tuesday, shares in its parent company, International Airlines Group, dropped 3 percent as investors appeared to worry that the company’s quality of service may have been undermined by recent efforts to save money.

 

Disaster struck on Saturday, when the company’s computer systems went down and there was no functioning back-up. The airline cancelled all flights and only managed to resume full service on Tuesday.

 

“Although cost cutting has been good for the share price in the last year, it will come back to bite IAG if it stops them from doing what they are supposed to do: Fly passengers to their destinations,” said Kathleen Brooks, the research director at City Index.

 

IAG has been battling tough competition, even as it has faced pressure on its earnings from a weaker pound following Britain’s decision to leave the European Union. The company issued a profit warning following the Brexit vote nearly a year ago.

 

Cost pressures aggravated an already complicated situation. Renewing IT systems is complex, time-consuming and expensive — a factor that prompts many companies to put it off as long as possible, said Loizos Heracleous, a professor of strategy at Warwick Business School.

 

The problem with IT systems is recurring across the industry, particularly among established airlines. In August, Delta Air lines cancelled hundreds of flights when a power outage likewise knocked out its computer systems worldwide.

 

Airlines face challenges with their IT systems also due to linkages across their systems. There’s further demand on the system when companies consolidate — as has been the case among airlines — since “IT issues get heightened and any vulnerabilities are exposed.”

 

Such troubles give an advantage to newer airlines such as Ryanair, a cost-cutting BA rival that focuses on short haul budget flights.

 

“The ability to set up an airline from scratch by-passes a lot of the legacy issues, because you can go for state-of-the-art systems,” Heracleous said. “Newer airlines can also invest in IT systems that are more easily upgradeable and scaleable. An airline such as Ryanair, that is also financially successful, has more leeway to divert needed resources towards upgrading its IT systems.”

 

Capitalizing on BA’s troubles, Ryanair said it had seen “strong bookings” over the weekend. Its Twitter account rubbed salt into the wound with tweets that poked fun and added the hashtag “ShouldHaveFlownRyanair.”

 

The company’s chief marketing officer, Kenny Jacobs, admitted on the BBC “we had a bit of fun on social media.”

 

“We don’t take social media seriously but we do take IT very seriously and that is why we’ve never had an outage,” he told the BBC.

 

Ryanair posted a 6 percent increase in annual profits Tuesday to 1.3 billion euros ($1.4 billion) despite “difficult trading conditions,” caused by terror attacks in European cities and a sharp decline in the British pound.

 

BA, meanwhile, is counting up the cost of an IT debacle that some have estimated could run into the tens of millions. There are also all those news clips of passengers swearing they will never fly the airline again.

 

“The whole sorry episode has undeniably put a dent in BA’s reputation for delivering a premium service,” said George Salmon, equity analyst at Hargreaves Lansdown.

 

 

Goldman Sachs Criticized for Venezuelan Bond Deal

The head of Venezuela’s opposition-led congress on Monday blasted U.S.-based bank Goldman Sachs for a financial transaction that he said would prop up his country’s unpopular socialist government while exacerbating difficulties for ordinary Venezuelans.

National Assembly President Julio Borges denounced the bank for “trying to make a quick buck off the suffering of the Venezuelan people,” he said in an open letter to the bank’s leader, criticizing last week’s deeply discounted purchase of $2.8 billion in Venezuelan bonds.

Borges said in the letter that he would recommend “to any future democratic government of Venezuela not to recognize or pay on these bonds.”

As The Wall Street Journal first reported Sunday, Goldman Sachs Group Inc. last Thursday closed a deal in which it agreed to pay Venezuela’s Central Bank $865 million for the bonds issued by state-owned oil company Petroleos de Venezuela SA (Pdvsa) in 2014. That’s a rate of 31 cents on the dollar. A London-based intermediary, Dinosaur Group, handled the transaction, The Journal noted in a follow-up story.

In seeking money to satisfy creditors such as Russia and China, the Venezuelan government was considering “all options,” The Journal quoted the country’s oil minister as saying last week.  

Borges said the assembly would begin a probe into the deal. Venezuela’s opposition leaders repeatedly have asked foreign governments and investors not to do business with the Maduro administration, which it has accused of human rights abuses.

 

Venezuela has been wracked by nearly two months of street demonstrations, sparked by the jailing of Maduro’s political rivals, delayed elections and widespread shortages of food, medicine and other basics. At least 60 people have died in the protests.

Goldman Sachs defended its actions in a statement it emailed to Voice of America:

“We bought these bonds, which were issued in 2014, on the secondary market from a broker and did not interact with the Venezuelan government. … Many investors make similar investments daily through mutual funds, index funds and ETFs which also hold Pdvsa bonds. We recognize that the situation is complex and evolving and that Venezuela is in crisis. We agree that life there has to get better, and we made the investment in part because we believe it will.”

Keeping score

Borges warned that any future Venezuelan government “would not forget where Goldman Sachs stood when it had to choose between supporting the Maduro dictatorship and democracy for our country,” The Wall Street Journal quoted the lawmaker as saying.

Venezuelan economist Ángel García Banchs, a Central University of Venezuela professor and Econometrica think tank director, said the bank “is making a financial bet [that] the government is going to fall. This bet, I think, is correct” – and will pay off for the institution and its investors, he predicted.

But García questioned the ethics of the deal, calling it “a very serious mistake.”

Similarly, José Méndez, a Venezuelan petroleum engineer who studied at the George Washington University in Washington, described the investment as “criminal behavior.”

“Really, these are criminal operations against the republic,” Méndez said. “How is it possible that Goldman Sachs is [paying] 31 cents for every dollar that must be extracted from the bloodstream of the Venezuelan nation? That cannot be.”

VOA Spanish Service correspondent Alvaro Algarra contributed to this report from Caracas, Venezuela.

Workers Wanted: French Jobs Unfilled Despite High Unemployment

France, troubled for years by high unemployment, is now grappling with a lack of qualified workers. While it still has 3.5 million registered jobseekers, a growing number of positions lie unfilled because companies can’t find the right people.

Many company bosses are pinning their hopes on newly-elected President Emmanuel Macron, and specifically his labor reform plans, to help find willing and able workers.

One such employer is Philippe Girard, who heads the French subsidiary of British construction equipment maker JCB. Despite offering above market pay rates for entry level jobs, his firm has been unable to fill 50 posts for maintenance technicians in its dealership network for more than a year.

“It’s becoming a brake on our development because clients increasingly want maintenance service on construction sites and without technicians we can’t meet their needs,” he told Reuters.

Girard has also been looking in vain for six months for three sales executives at the JCB France headquarters in Sarcelles, a satellite town of Paris where unemployment is in double digits.

Critics of the current regulatory regime say rigid labor rules and poorly adapted training unnecessarily keep the unemployment rate close to 10 percent.

Macron hopes to fix the mismatch of supply and demand for workers by pouring billions of euros into training while simplifying the labor code.

The object is to make it easier for employers to hire but also to shed staff, should their business turn down in the future. To sweeten the pill, he also wants to expand unemployment benefits for people seeking a career change.

Similar but less ambitious measures to free up the labor market have in the past run into resistance in parliament, and provoked sometimes violent protests on the streets.

Undaunted, Macron has made the reforms his top priority, starting talks with trade unions last week. He is also seeking a majority for his party in legislative elections next month to strengthen his hand in pushing them through parliament.

Skills gap

Companies’ demand for workers is surging as the economy slowly picks up. Government employment agencies had received 274,000 unfilled job offers as of April, up 14 percent in a year and close to levels not seen since November 2011.

Demand for workers on longer-term contracts — which French firms often avoid, fearing they will be unable to get rid of staff in the future — is growing faster than for short-term hires. More than half of the offers received were for contracts of over six months.

Recruitment group Manpower found in a recent survey that nearly one in four French employers was struggling to find workers.

“We clearly have a skills gap between what our customers are looking for and people’s real skills,” Manpower France head Alain Roumilhac told Reuters.

With even relatively lowly-paid industrial workers usually needing to use digital technology, Manpower is investing millions and receives public subsidies to train workers up to meet employers’ expectations.

Eric Labaye, a senior partner at the McKinsey consultancy, said that while 90 percent of jobs require at least basic proficiency with digital technologies, 40 percent of the workforce did not have such elementary skills.

“Adapting the labor market and skills is clearly a priority. The primary focus should be on getting more people with the right skillset into growing sectors. Second is the development of these growing sectors themselves,” Labaye told Reuters.

One example is booming demand for data specialists. France employs fewer of them as a proportion of its workforce than any other OECD country except Turkey, despite a world-class reputation for higher mathematics, according to figures from the 35-nation organization.

Big money

Macron has said he wants to invest 15 billion euros ($16.8 billion) in building up skills for a million youths and another million low-qualified, long-term unemployed people.

France already spends nearly 32 billion euros a year on professional training, equivalent to 1.5 percent of economic output, but only 15 percent goes to training job seekers, according to data from the Labor Ministry.

“France puts a lot of money into the training system but it is very, very complex,” said OECD economist Nicola Brandt, who is preparing a report on France for the organization.

“More money is always better, but we have an issue of money not being used in the right way, basically not going to the people who need it most,” she said.

Extra money for training, as well as extending unemployment benefits to cover people who want to leave jobs for a new profession, could help make Macron’s reforms more palatable to critics.

Eager to push ahead on labor reform quickly, Macron launched talks with unions last week knowing he will have to overcome resistance to his plans to ease regulation.

Though it would help if he wins a parliamentary majority, labor reform is always a deeply sensitive issue in France, where high job security is cherished.

His Socialist predecessor, Francois Hollande, tried to introduce more working time flexibility and rein in labor tribunal challenges and payouts last year, leading to violent student protests in French cities.

Eventually Hollande’s government – in which Macron served as economy minister — invoked special powers to impose the reforms by decree due to a lack of support in parliament.

“Only one mistake could break everything. Macron is trying to be as clever as possible, especially with the unions because even if he has a majority in parliament he has a very narrow path to deploy the program,” Manpower’s Roumilhac says.