DECEMBER 2011 |
www.opp.org.uk WORDS | John Howell
Being self-aware A
nd not only has it been a challenging month, it has also been a busy month.
My travels have taken me on trips to Turkey, Greece, France and Cape Verde since I last wrote my column in OPP. All of these places cast an interesting light on the current fi nancial crisis and give us some pointers as to how, as an industry, we should be reacting. First, Cape Verde. You may have seen the news item that the retired president of Cape Verde (yes, retired ... not deposed or bombed into exile) has just won the annual prize for good governance in Africa. I say the annual prize but, in fact, for the last two years they couldn’t fi nd anyone in the whole of Africa to whom they were comfortable giving a prize. The prize is known as the Mo Ibrahim prize and it is worth a tidy £3m. Anyway, Pedro Pires was awarded the prize because Cape Verde is “a model of democracy, stability and increased prosperity”. He also declined an offer to change the constitution to permit him to stay in power for longer. I am not at all surprised at this award. I have been saying for years that Cape Verde is the only country where I do business where I have never been asked for a bribe. It has a fabulous year-round climate, offers excellent rental yields for the right properties and is one of the few bright spots in today’s property market – perhaps not least because the Italians have always been major players and rumour has it that lots of them want to fi nd a new home for their money. I wonder whether Mr Berlusconi is looking for new home? Anyway, well done Cape Verde. Democracy, stability, prosperity and integrity. Not at all like Europe then. And so, to Greece. I was there during and immediately after the strikes and I was absolutely amazed by how little impact what is going on seems to have on the Greek people. Flights were
full, bars and restaurants were busy, developers are pursuing major (some might say grandiose) development plans and everybody is preoccupied with not having to pay any tax. At one of my meetings, three
quarters of the time was spent talking about tax issues and only the rest on the project.
People in the street blame everything on the Germans. They should have paid
“Those in property have more or less turned their back on the western European markets”
Greece compensation for what they looted in 1941.
They are worried about
unemployment but do not seem to think that it is at all unreasonable when a prosperous doctor declares an income of €10,000 per year or when some civil servants can retire at 49. Yet, below the surface, there is
change. The more forward looking are keen to embrace concepts that would previously have been very alien. Contractual transparency. Payment by results. Indemnity insurance. And below the surface, people are very
BUSINESS
You may not be familiar with the words of the immortal Robert Burns: “Oh wad some power the giftie gie us To see oursel’s as others see us!” (“If only some power would give us the gift to see ourselves as others see us”) But they are words that have come strongly to mind over the last month or so as I travelled around the international property world.
worried. They just cannot get their heads around the enormity of what is happening to them. They quietly hope that the speculators will attack the Italians and that the Greeks can get on with their fi shing, growing tomatoes and chasing girls. Turkey, on the other hand, is very
bullish. Everybody stills seems keen to join the European Union and they are all very optimistic about the ongoing growth in their own economy and the ever better trade relations with the peripheral Soviet republics such as Azerbaijan – which is awash with money, much of it from dubious sources.
Those engaged in the property industry have more or less turned their back on the western European markets. Of course, they are very happy when an English person comes and buys a €150,000 house but for every one of them there is a local person or an Azerbaijani wanting a €1m house – and probably a boat to go with it. If you are looking for an investment
market Turkey must be worth a closer look, particularly as its government increases Turkey’s profi le as a regional power and stands up for moderation. France is France. Those who know me will know my affection for the
John Howell of John Howell & Co is a specialist in international legal and property advice. Email:
john@jhco.org Tel:+44 845 676 9195
country and, on the face of it, very little has changed as a result of the recent goings on in distant lands such as Greece and Italy - which the average Frenchman thinks of as crude prototypes for the democracy which flowered and reached perfection in France.
Property prices rise (Paris up 22.5% in the last year and 48% in the last fi ve years and Nice doing nicely). People become more wealthy. However, there are unexpected signs of change. The front page story in Le Figaro for the 15th October was “the mad expenditure of your elected representatives”.
It talked of 200 cities with toxic debt, of more and more departments calling for the state bail-out fund, and of expenditure by local authorities up 60% in 10 years.
There is now an open debate about the need to reign in public expenditure and, with it, many of the things that we think of as quintessentially French – the best health care in the world, public transport, the arts and that very Gallic sense of a good life, well lived. This story is only just beginning and I think we can expect major developments over the next six months. Will they be enough to dampen the British enthusiasm for buying properties in France – one of the few markets that has looked fairly solid over the last few years - who knows? Finally, an interesting link between all of these countries: all of them are introducing major legal reforms with a view to encouraging the ownership of property by foreigners.
Cape Verde | A warm, sunny, well-run and successful overseas property destination
Do they know something that the rest of the world doesn’t?
LEGAL | 29
Page 1 |
Page 2 |
Page 3 |
Page 4 |
Page 5 |
Page 6 |
Page 7 |
Page 8 |
Page 9 |
Page 10 |
Page 11 |
Page 12 |
Page 13 |
Page 14 |
Page 15 |
Page 16 |
Page 17 |
Page 18 |
Page 19 |
Page 20 |
Page 21 |
Page 22 |
Page 23 |
Page 24 |
Page 25 |
Page 26 |
Page 27 |
Page 28 |
Page 29 |
Page 30 |
Page 31 |
Page 32 |
Page 33 |
Page 34 |
Page 35 |
Page 36 |
Page 37 |
Page 38 |
Page 39 |
Page 40 |
Page 41 |
Page 42 |
Page 43 |
Page 44 |
Page 45 |
Page 46 |
Page 47 |
Page 48 |
Page 49 |
Page 50 |
Page 51 |
Page 52 |
Page 53 |
Page 54 |
Page 55 |
Page 56 |
Page 57 |
Page 58 |
Page 59 |
Page 60 |
Page 61 |
Page 62 |
Page 63 |
Page 64 |
Page 65 |
Page 66 |
Page 67 |
Page 68 |
Page 69 |
Page 70 |
Page 71 |
Page 72 |
Page 73 |
Page 74 |
Page 75 |
Page 76