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Countries: South Africa

Posted on Monday, July 07, 2008 - 10:08 AM
South Africa's Thabo Mbeki held talks in Harare July 4, with Zimbabwe's President Robert Mugabe and members of a breakaway opposition faction. Mr Mbeki has been the chief regional negotiator on the Zimbabwe crisis, and has been trying to persuade Mr Mugabe to form a government of national unity. However, Morgan Tsvangirai, leader of the main opposition party, the Movement for Democratic Change (MDC), declined to meet Mr Mbeki. Robert Mugabe has said the opposition must accept him as leader before any talks on ending the country's political crisis. "I am the president. Everybody has to accept that if they want dialogue," he told thousands of cheering supporters. Robert Mugabe's election victory in Zimbabwe was never in doubt. After losing the popular vote to opposition leader Morgan Tsvangirai back in March, he was standing in a one-man race conducted in an atmosphere of fear and foreboding. Mr Tsvangirai had pulled out of the presidential run-off, saying he could not ask supporters to cast ballots "when that vote would cost them their lives". But his name remained on the ballot. Tens of thousands of Zimbabweans dared to place a cross by his name, knowing that retribution could follow. A significant number of others spoiled their ballots in protest at being forced to vote. The MDC says 5,000 of its members are still missing and that more than 100 of its supporters have been murdered in continuing post-poll intimidation. A spokesman for Zimbabwean President Robert Mugabe rejected Western criticism of the country's disputed presidential run-off election. A small group of African states has joined the European Union, the US and other Western nations in criticising the way the election was run. At an African Union summit in Egypt, George Charamba said the West had no basis to speak about the situation - and can "go hang a thousand times". Zanu-PF's Robert Mugabe said he had won the vote, boycotted by the opposition. The opposition MDC said the June 27 one-man election had killed off any prospect of a negotiated settlement. Tendai Biti, the Movement for Democratic Change's secretary-general who faces treason charges in Zimbabwe, said the country's "sham election" "totally and completely exterminated any prospect of a negotiated settlement". He denied any negotiations were going on between the two parties, or that an agreement was in the offing. Zimbabwe's ruling party also rejected criticism of its leadership by former South African President Nelson Mandela ahead of the election. Mr Mandela said Zimbabwe was suffering a failure of leadership. A ruling Zanu-PF official described Mr Mandela's comments as unacceptable and unfortunate for a man of his stature. South Africa's main labour union the Confederation of South African Trade Unions (COSATU) held a demonstration at the Beitbridge border post July 4 protesting against Robert Mugabe's regime. Spokesman Jan Tsiane urged continental bodies to intervene in the crisis and help restore democracy in the wake of Mugabe's one-man election. No incidents were reported during the protests except the arrest of one man who was later released. COSATU said their federation was opposed to the formation of a government of national unity adding that a transitional authority was the best way forward. Such an authority would be formed using proportional results from the March 29 poll and this body would organise fresh elections that reflect the will of the people. An inter-agency United Nations team is helping the South African Government respond to May's wave of xenophobic attacks in South Africa, that killed some 60 people and left tens of thousands of foreigners homeless. The UN High Commissioner for Refugees (UNHCR) has established a telephone hotline for refugees and asylum-seekers and is also assisting the Government with efforts to register displaced people in Gauteng province, scene of much of the recent violence. The UN Children's Fund (UNICEF) is helping with nutrition, education and child protection efforts and has also provided basic recreational materials for school students. The inter-agency team is also leading training for officials in Cape Town and elsewhere on disaster response and applying humanitarian principles. Officials across the UN have spoken out against the xenophobic violence in South Africa, which is home to more than 128,000 registered refugees and asylum-seekers. African National Congress (ANC) president Jacob Zuma has thrown an isolated President Thabo Mbeki a lifeline, endorsing Mbeki's presidency until the end of his term next year, saying there were no rival "camps" in the ANC. Their show of unity came in a lengthy joint letter to City Press newspaper June 8, and follows a report in the paper that said Mbeki's followers had mounted a "fight-back" campaign against Zuma. "Neither of us holds opposing political positions. Neither of us is involved in a struggle to build a personal support base in the ANC ... there is no Zuma camp in the ANC. There is no Mbeki camp in the ANC," the letter reads. The letter comes amid calls from among the ANC's leftist allies for Mbeki to step down, saying he is unable to govern effectively or provide the leadership required. The high-profile unity attempt faces a hard sell among senior ANC members. They said it would amount to an "empty declaration" unless backed up by "practical and genuine" steps to address underlying divisions in the ruling party. AU treads softly on Zimbabwe The African Union (AU) summit in Egypt was dominated by the problems of Zimbabwe. Coming just three days after the country's highly controversial second-round vote, this was Robert Mugabe's first international appearance since being re-elected president. In the old days of the Organisation of African Unity, the continental body could quite reasonably have been described as a dictators' club. There were always one or two honourable exceptions - Senegal for instance, and Botswana. Yet otherwise, between the military coup plotters and the presidents-for-life, the majority of those attending summits would have been in no position to criticise any of their colleagues for lack of democracy. But things are changing. The old democracies - those honourable exceptions of the past - are still there, and they have now been joined by countries like Sierra Leone and Liberia, which have emerged as democracies despite devastating civil wars. Sierra Leoneans recently voted out the ruling party candidate, and Liberia's elections produced a run-off between a woman and a football star. This was far more representative of Africa's young population and powerful women than the middle-aged men who still fill the hall at African Union summits. Even Nigeria, where elections have often been far from perfect, enjoys lively political debate and rampant freedom of speech. These were the countries which, from their own position of strength, led the criticism of Robert Mugabe in Sharm el-Sheikh. In public, most of his colleagues simply ignored him, but behind closed doors he was obliged to sit and listen to trenchant criticism of the way he had been returned to power. Possibly the strongest came from Zimbabwe's neighbour, Botswana. Its vice-president, Mompati Merafhe, said Botswana did not believe the elections reflected the will of the Zimbabwean people or conferred legitimacy on President Mugabe's government. Representatives of the present Zimbabwean government should be excluded from African Union meetings, he argued. Delegates who attended the closed debate said that Mr Mugabe was given the chance to respond to the criticisms, which he did at considerable length. He must have been persuasive, since the resolution which emerged at the end of the session was as favourable as he could have wished. It expressed concern about the criticism by observer groups of the conduct of the elections, but did not pronounce them illegitimate. It made no mention of any sanctions against Mr Mugabe's government, only encouraging the parties to honour their commitment to participate in dialogue, and supporting the call for a government of national unity. It also warmly endorsed the role of intermediary held by South African President Thabo Mbeki, who the more hawkish delegates considered either ineffectual, or far too close to Mr Mugabe. The African Union proceeds by consensus, not majority vote, and there was clearly no consensus for any kind of sanctions. Even so, it was a weak resolution. It was also one whose proposals depend utterly on the goodwill of the contending parties. And not everyone felt they could rely on that. The Liberian President, Ellen Johnson Sirleaf, said she thought it was the view of many in the room that President Mugabe's government would have what she called "insurmountable difficulties" in leading efforts to put into effect the solutions proposed in the resolution. Botswana Urges Africa Not To Recognise Zimbabwe Election Result Botswana has taken the toughest stance against Mr Mugabe and urged Zimbabwe's neighbours not to recognise the election result. The comments came as the opposition Movement for Democratic Change (MDC) accused the government of trying to wipe out the parliamentary majority that it won in March. The party holds a majority of 10 seats in the 210-seat parliament. But at least 10 of its newly elected MPs are either in prison or wanted by the police on a range of charges. The MDC said another of its MPs had been abducted, while 53 are fighting court challenges to their electoral victories. Botswana's Foreign Minister Phandu Sekelemani said Zimbabwe should not be able to take part in meetings of the Southern African Development Community (Sadc) "until such time that they demonstrate their commitment to strictly adhere to the organisation's principles". But Mr Mugabe appeared to rebuff such African criticism. "If there are some who may want to fight us, they should think twice," he said. "We don't intend to fight any neighbours. We are a peaceful country, but if there is a... neighbouring country that is itching for a fight, then let them try it." He also dismissed any threats from British companies to stop doing business with Zimbabwe. "The British are threatening to withdraw their companies. We say the sooner you do it, the better," Mr Mugabe said, raising cheers from the crowd. The European Union said July 4 that it would only accept a result that respected Zimbabwe's first round on March 29, when official results gave Mr Tsvangirai more votes than Mr Mugabe - but not enough to avoid a run-off. A statement from the EU's French presidency said any settlement should be followed by a brief transition period, then fresh elections. Mugabe crisis 'infecting' Africa The crisis in Zimbabwe is "infecting the whole of southern Africa", UK Foreign Secretary David Miliband has said after visiting refugees. On a visit to Johannesburg, he said victims of political repression were fleeing there in their thousands. He said it was now "imperative" there was a new government in Zimbabwe. Zimbabwe's Robert Mugabe was declared the winner of a one-candidate run-off election, amid reports of the violent intimidation of his opponents. After meeting some of the 2,000 refugees who have taken refuge in the Central Methodist Church in downtown Johannesburg, Mr Miliband said: "This is now a crisis infecting the whole of southern Africa and one that is a man-made tragedy from the top of the Zimbabwean regime." He said: "No-one who meets the people here could do anything other than redouble their efforts to secure international consensus that the Mugabe regime is not a legitimate representation of the will of the people of Zimbabwe." He said the international community had to "rally behind" tough United Nations Security Council resolutions in July to target individuals within the Mugabe regime. And he said it was "imperative" that a government was formed that respected the result of the first presidential result on March 29, when official results gave opposition leader Morgan Tsvangirai more votes than Mr Mugabe - but not enough to avoid a run-off. Mr Tsvangirai later pulled out of the presidential run-off, citing violence in the campaign. His MDC party says 5,000 of its members are still missing. Mr Miliband said a large number of orphans were among the growing number of Zimbabweans arriving in Johannesburg - adding he had seen the "human face" of the catastrophe in Zimbabwe. "At the heart of President Mugabe's rhetoric is the idea that this is a fight between Zimbabwe and Britain, it's not. "It's a fight between two different visions for the future of Zimbabwe, one of which has the support of the Zimbabwean people as expressed on March 29 and the other of which is held together by a small clique that holds power on the basis of violence and intimidation. I've seen the scars and the consequences of that violence and intimidation today." July 5, UN Warns Global Food Crisis Will Push 100m People Into Poverty The United Nations (UN) has warned that the current global food crisis, compounded by a hike in fuel prices and climate change, will push more than 100 million people into poverty. United Nations Deputy Secretary-General Asha Rose-Migiro said June 30 at the official opening of the 11th AU Heads of State and Government Summit that this development risked reversing the positive steps made towards achieving the Millennium Development Goals (MDGs). Dr Migiro, however, noted that many African countries had made tremendous progress towards the achievement of the MDGs. She said well designed and properly financed programmes had helped reduce child mortality, improve water and sanitation and expanded primary education in some African countries. "There are numerous other examples that prove that the ambitious MDGs can be achieved. "The careful plans crafted by African governments need to be backed by adequate and predicable donor financing," Dr Migiro said. She, however, noted that donors had not yet delivered on their pledges made three years ago at the annual summit of the Group of Eight (G8) most developed nations at Gleneagles, Scotland, to support African countries meet the MDGs. She said inadequate donor financing and other constraints had made it difficult for African countries to reach some of the MDGs. Support for Africa was not only a moral imperative but was also critical for global peace and security, she added. Dr Migiro also urged African leaders to stand by the people of Zimbabwe who were facing an extremely grave crisis. She said what was happening in Zimbabwe was the single greatest challenge to regional stability in southern Africa not only because of its humanitarian and security consequences but because of the dangerous political precedents it had set. The climate in which the June 27 run-off presidential elections in Zimbabwe took place was not conducive to free and fair elections because of the violence and intimidation that prevailed, she said. She regretted that the run-off went ahead despite concerns raised by the international community including the UN Security Council. She urged regional leaders to mobilise support for a negotiated solution because only dialogue between concerned parties in Zimbabwe, supported by the AU and other regional actors, could restore peace and stability in that country. US Lifts Stigma Against ANC : the message finally got through! President Bush July 1 signed into law a measure by House Foreign Affairs Committee Chairman Howard L. Berman (D-CA) that will eliminate a government-imposed stigma against association with the African National Congress of South Africa. Now the United States will remove from its databases any notation characterising the ANC and its leaders -- including Nobel Laureate and former South African President Nelson Mandela -- as terrorists. “For many years under the old Apartheid regime, injustice heaped upon injustice as the world watched, and even complied,” said Berman, who is leading a Congressional delegation to South Africa. “Today the United States finally has removed from its legal code a vestige of that time of collective insults against human dignity. The label of ‘terrorist’ will no longer be affixed to associates of the ANC -- among them one of the world’s great heroes, Nelson Mandela. Our country stands with those who struggled to bring the reprehensible system of Apartheid to an end.” For decades the ANC resisted Apartheid and advocated the rights of black South Africans – first through non-violence and community activism, and then through the actions of its military wing. The South African government banned the ANC in 1960, and the United States denied entry to ANC members based on the group’s activities. With the end of Apartheid in 1990, the ANC grew to become the leading political party; it continues to lead South Africa in a multiracial, multiparty democracy. Under the new law, ANC membership or associated activities alone will no longer trigger additional investigation into an individual’s application for a visa to the United States. Congress passed the final version of Berman’s legislation (H.R. 5690) on June 26. House co-sponsors included Judiciary Committee Chairman John Conyers (D-MI), Homeland Security Committee Chairman Bennie G. Thompson (D-MS), Africa Subcommittee Chairman Donald Payne (D-NJ), and Foreign Affairs Committee members Barbara Lee (D-CA) and Sheila Jackson-Lee (D-TX), and Oversight and Government Reform Committee member Peter Welch (D-VT). Tutu Lashes Out At Mbeki for 'Quiet Diplomacy' Policy Nobel laureate Archbishop Desmond Tutu lashed out at South African President Thabo Mbeki, accusing him of being obviously reluctant to quell the situation in Zimbabwe prior to the election. Tutu was speaking during an interview with news service, ‘Al Jazeera’ June 15. He said Zimbabweans "are not happy with the way Mbeki has handled the crisis," and that Mbeki, "chose to remain silent even when Zimbabwe's crisis was at fever pitch". Mbeki has been widely criticised for his on-going policy of 'quiet diplomacy,' as well as his apparent support for Robert Mugabe. The South African president has also in the past actively distanced himself from the crisis, and only publicly condemned ongoing violence there for the first time last week. In Sunday's interview, Tutu said Mbeki could have used his power as the current mediator of the crisis by warning Mugabe against dictatorial acts. The elderly but much respected laureate said he will ask former United Nations Secretary General Kofi Annan to mediate the same way he conducted mediation during the Kenyan post-election violence. Tutu said Annan is trusted better than anyone else in the world to fill the role as mediator because of his efforts on Kenya and, "the world can trust him to do the same in Zimbabwe". Tutu added that Mugabe "should consider a dignified exit from power," and that his retirement will save many people a great deal of suffering. Allies Turn Up Heat on Zuma Trial As African National Congress (ANC) president Jacob Zuma continues his charm offensive aimed at business and minorities ahead of next year's election, his foot soldiers in the tripartite alliance are trying to put forward a cogent argument why his corruption trial - due to start in August - should be scrapped. Efforts to mobilise support for Zuma - who has to answer charges including corruption and racketeering - have moved into high gear, with the tripartite alliance secretariat driving the solidarity campaign. Zuma's supporters say they want the charges dropped because of what they call the systematic abuse of state organs by Zuma's political opponents and the denial of Zuma's constitutional right to a fair trial. The ANC's national bodies have yet to comment on the call that Zuma's trial be scrapped. But calls for the case to be dropped were growing as ANC provincial organs and its leftist allies have started to rally around Zuma ahead of his trial. The ANC's KwaZulu-Natal conference resolved that charges against Zuma had to be withdrawn. Earlier, the ANC Youth League went public over its plans to seek legal opinion on how to get the charges against Zuma dropped. The league has said that conditions for a fair trial for Zuma do not exist. South African Communist Party (SACP) secretary-general Blade Nzimande confirmed yesterday that support for Zuma during his trial was on the agenda of the tripartite alliance secretariat. "We are united on this issue and it has to be finalised soon. We are going to embark on a massive mobilisation effort with our people to explain why we believe that Jacob Zuma's right to a fair trial has been compromised," he said. Nzimande said the state's eight-year probe of Zuma had been riddled with abuse. He said analysts who criticised the call for charges against Zuma to be dropped were disingenuous. "They were all silent when some state organs abused their powers against the ANC president as the public protector found when he said that the National Prosecuting Authority under Bulelani Ngcuka had abused his position, a view shared by the findings of the Khampepe commission," Nzimande said. "These analysts were also silent over Parliament's inaction following the recommendations of the public protector. But the most serious is their silence on the Special Browse Mole report that effectively said that Zuma was involved in plotting to overthrow the government while in cahoots with some African leaders," he said. While the state said that "rogue" spies were responsible for peddling the information and that they were to be arrested, nothing has come of this, Nzimande said. Centre for Policy Studies political analyst Aubrey Matshiqi said there were two ways of interpreting the call for the charges to be scrapped: "It seeks to reinforce the idea that Zuma is a victim of political conspiracy and a victim of manipulation on the part of state institutions, thus the message that Zuma cannot get a fair trial." Another possibility was that desperation had set in among the Zuma coalition. "If this is the case, what has set off this desperation? Does it mean they are privy to information that Zuma's legal woes may be worse, and because of this they are trying to mobilise support to either prevent the trial from proceeding, or mobilising against a conviction?" Matshiqi said the ANC could divide further as factions differed about how best to provide support for Zuma. Presidential Council Discusses Recent Violence The recent attacks on people from other countries among other issues topped the agenda at the Presidential Co-ordination Council meeting June13. The meeting, attended by President Thabo Mbeki and Deputy President Pumzile Mlambo-Ngcuka, among others, seek to discuss progress reports on the 15 year review and the way forward. According to the Office of the Presidency, the meeting noted that a total of 62 people had lost their lives and 21 of those were South African citizens. A total of 1300 incidents of violence were reported and more than a thousand people were arrested. The government announced June 12 that it was considering declaring a national day of healing to enable the nation to pay its respects to all those who lost their lives during the recent attacks on people from other countries. "The proposal for the declaration of a national day of mourning, healing and introspection, to allow the nation to pay its respect for those who lost their lives during the violence has been endorsed," said Government spokesperson Themba Maseko June 13. Mr Maseko said the Inter-Ministerial Task Team on attacks on people from other countries was mandated to develop a proposal and a national day of mourning for those who lost their lives will be observed on the June 24. "This will not be a public holiday, but a day on which the public will be expected to pay its respect, to those who lost their lives during the violence," he said. He added that a national memorial tribute event will be held in Pretoria with details to be announced by the Inter -Ministerial task Team later. June 11 marked a month since the attacks on people from other countries broke out in Alexandra in Johannesburg. The attacks spread to other informal settlements around the country, forcing thousands of people to flee their homes and seek refuge at police stations Other issues discussed at the Presidential Co-ordination Council were the War on Poverty campaign, the Thusong Service Centres and expenditure trends. The War on Poverty campaign as announced by the President and Deputy President in parliament has also been endorsed. Mr Maseko further said the report on the expenditure trends, provincial audit outcomes were noted and it was agreed that provinces should gazette budget allocations to provinces and municipalities. Xenophobic Violence – Relocation Issues While the South African government focuses its efforts on the controversial relocation of thousands of migrants displaced by xenophobic violence to temporary shelters, it is becoming increasingly clear that the next step in the plan - reintegration into South African communities - will be hard to sell to immigrants and communities alike. On June 1, three weeks after the first attacks, authorities in Gauteng, South Africa's richest province and epicentre of the violence, started removing displaced foreign nationals from makeshift shelters at police and fire stations, churches and communal buildings that had initially provided safety. But the relocation sites soon came under fire from planners, civil society and UN agencies, which all suggested that basic humanitarian standards were far from being met. Now the government has said the camps are merely a temporary solution, and "the target is that by the end of two months, the temporary shelters will be shut down and the people will have returned to their communities, or will have voluntarily decided to repatriate," Thabo Masebe, a spokesman for the Gauteng Provincial Government, told IRIN. "There are no efforts or attempts to prolong the foreign nationals' stay at those places," Gauteng Premier Mbhazima Shilowa told a media briefing June 3. "The provincial government will meet with all municipalities ... to chart a way in which we would reintegrate those displaced by the xenophobic attacks." The target is that by the end of two months, the temporary shelters will be shut down and the people will have returned to their communities, or will have voluntarily decided to repatriate Jody Kollapen, Chairman of the South African Human Rights Commission (SAHRC) said keeping people in camp-like settings would clearly segregate the residents as "non-South African", increasing their vulnerability and isolation. "Having people leave the country sends a very dangerous message," and communities might interpret repatriation as a sign of success, an indication that violence was a sure way of driving people out for good, Kollapen said. But observers say the reality of reintegrating migrants displaced by violence will present substantial challenges: the migrants' fear and mistrust of the communities that so violently shunned them, the continued frustration of host communities over their own socio-economic problems, and the lack of a concrete plan. According to a June 4 statement released by the Gauteng provincial government, the plan is to be led by a national Inter-Ministerial Committee (IMC) on xenophobic attacks. The aims of the government's plan are: "Ending the violence and stabilising the situation in affected areas, attending to the humanitarian relief and providing for the basic needs of the displaced persons, and the creation of necessary conditions for the reintegration of displaced persons back into their communities." At the height of the violence the army was brought in to assist an overstretched police force and since then, according to the statement, "the situation has calmed down considerably" and "this is no doubt due to the increased visibility of the police and the support of other law enforcement agencies". No recent incidents have been reported. Meanwhile, the government has been slammed for providing late and inappropriate relief, and at least one relocation site has been scrapped due to security and structural concerns. Shilowa said the government was now doing everything in its power to ensure that the temporary shelters met international standards for humanitarian assistance. The final step of re-absorbing victims into society is to be accomplished by means of education and community co-operation. "The government's role is to lay the groundwork for the conditions for return," said Masebe. "What we will do is to talk to the communities and help them to create the conditions for returning them [displaced people]. We will tell these communities to allow them to return and to not attack these people." "We are quite concerned about the way the reintegration will take place," said Monica Bandeira, a senior researcher at the Trauma and Transition Programme of the Council for the Study of Violence and Reconciliation (CSVR). "When you talk about reintegration, it's a complex process. There's the community, which also includes the people who have perpetrated the violence; and then there are the victims, who have lost most of their possessions and fear for their safety," Bandeira said. Adane Ghebremeskei, manager of the Peace-building Programme at CSVR, is working towards co-ordinating dialogue sessions between community leaders and migrant representatives. "We want to get first-hand information, and then go to the immigrant communities and get the issues from their side and learn about how it escalated, in order to find if there is common ground. You need a lot of groundwork, consultations; I don't think it's overnight work. The government cannot do this alone," Ghebremeskei said. The biggest challenge, Kollapen said, would be establishing acceptance within communities. "At the heart of successful integration is building trust - that will take a lot of communication." He expected civil society, churches and trade unions to play pivotal roles. And on the other hand, "We need to deal with the fears of those affected by the violence." "Without offering justification for the violence," Kollapen said, the socio-economic hardships of host communities would need to be addressed urgently. Many communities, characterised by high unemployment and seemingly last in line for much needed basic service upgrades and housing development, had long felt "neglected and marginalised", and reacted by blaming foreigners for stealing jobs, high crime rates, and general deprivation. "This was a significant wake-up call - the government is now acutely aware of this." Recent years had seen numerous protests calling for government to address the plight of the poor in these areas, he said. Any form of reintegration would only be successful if the needs of host communities and returning immigrants were addressed in tandem. "We must be mindful that humanitarian assistance is ... also demonstrated to South Africans, who also live in dire conditions," Kollapen said. At the muddy camp for displaced migrants, north of the capital, Pretoria, foreign nationals were uniform in their distrust of returning to South African communities. Mukadi Roger, from the Democratic Republic of Congo, was watching television at a friend's house when the xenophobic attacks started. He said a bullet came through the window of the house and both men ran and never returned. He said reintegrating into South Africa was not realistic. "The hostility is still there, but they won't say it openly right now. The same people are still there; you want me to go back there? No. They won't miss the second time." He pointed out that the attacks had spread throughout the country, so there was no area where he would feel safe. "People are only staying here in these conditions because of fear," said Idi Kubwima, a Burundian. "But people fled [violence in] their countries to come here and now it's the same [here]," he said. "I lost my home and family in Sudan and I came here for protection," Mohammed Ahmad told IRIN. "For most of the people here [in the camp], there is no place to go back home." Starting over, especially under hostile conditions, and the practical problems caused by having lost everything, were recurring issues. Joyce Tlou, coordinator of the SAHRC's non-nationals programme, said after various community-level talks held by the SAHRC that many communities were "quite adamant that they will not be accepting foreign nationals back into their midst". "There is clearly a latent resentment towards the use of violence," Kollapen said, "but people did tend to associate themselves with the idea that their community needed to get rid of foreigners." South Africa extends police chief contract The South African government has extended the contract of suspended police commissioner Jackie Selebi. The decision came as a Johannesburg court ordered Mr Selebi to stand trial on corruption charges next year. He has denied the charges. A government spokesman said Mr Selebi's contract would be extended for a year, pending the trial's result. Mr Selebi is a close ally of President Thabo Mbeki, who has been accused of trying to protect him. In February, Mr Selebi was provisionally charged with corruption, accepting bribes worth 1.2m rand ($160,000, £80,000), and defeating the course of justice. Judicial officials said after a hearing June 26 that they expected the commissioner's trial to start in April 2009. Mr Selebi was placed on leave and forced to resign as head of Interpol earlier this year after authorities announced that he would be charged. Government spokesman Themba Maseko said he would remain on leave during the court case. "This decision was based on the need to allow due process to be concluded before a final decision could be taken on the future of his employment contract with the state," he said. At the heart of the allegations is Mr Selebi's relationship with convicted drug smuggler, Glen Agliotti, who is also being charged with the murder of a prominent mining magnate. South Africa's National Prosecuting Authority (NPA) has alleged that Agliotti paid bribes and gifts to the police commissioner in exchange for turning a blind eye to drugs trafficking. Mr Selebi has denied allegations of links to organised crime. Last year, Mr Mbeki suspended NPA chief prosecutor Vusi Pikoli after he issued a warrant for the arrest of Mr Selebi, a senior member of the ruling African National Congress. UN Completes Report on Country's Efforts Against Terrorism A United Nation's report, which follows a visit to South Africa to assess the country's legislation and national systems to implement anti-terror obligations, has been cited as positive. The UN's Counter Terrorism Executive Directorate (CTED) concluded an eight-day visit June 9. It was aimed at assessing the country's legislation, enforcement capacity and national systems to implement anti-terror obligations. Foreign Affairs Chief Director for UN Political Affairs, Xolisa Mabhongo told a press briefing that he could not discuss the full contents of the report as is was still to be submitted to the UN Security Council for discussion. However, he said, the delegation had noted South Africa was party to 13 universal conventions on terrorism, has national legislation in place and has a proven capacity to prosecute offenders as demonstrated by specific cases discussed during the visit. "This shows that our government is committed to improving anti-terrorism mechanisms and looking at joining hands with other multi-national groups in the fight against terrorism in the region," said Mr Mabhongo. The delegation was of the view that while the South African authorities exercise vigilance with respect to any potential acts of intolerance and incitement to violence, they are steadfast in their commitment to the constitutional right to freedom of expression. "The delegation noted the concerted effort made by government to maintain dialogue with and understand the concerns of many different religions and ethic groups in the country," said Mr Mabhongo. He added that the South African government is committed to continuously improving its anti-terrorism systems and therefore welcomes the positive contribution made by the CTED delegation. "We look forward to continuing its dialogue with CTED and the other multilateral bodies, in line with its policy that international threats such as terrorism are best dealt with collectively in multilateral fora and in particular at the United Nations." He said the delegations noted the political, social and historical context in which terrorism is addressed in South Africa and in particular the country's strong commitment to human rights and to addressing all forms of crime, including terrorism, within the framework of national and international law. South Africa was recognised as the first country to agree to the inclusion of a human rights expert on a CTED delegation. The delegation held discussions with 21 national departments and other bodies that work to counter the threat posed by terrorism and other forms of crime. It also conducted site visits to OR Tambo International Airport, Durban sea port and the Beitbridge land border with Zimbabwe. Visits were made to the offices of the South African Police Service, the National Coordinating Bureau of Interpol, the National Prosecuting Authority, the Department of Social Development, the Financial Intelligence Centre and the Human Rights Commission. In May this year Deputy Director General in the Department of Foreign Affairs Ambassador George Nene said South Africa was up to date with its reporting requirements to the UN Security Council with regards to anti-terrorism. "South Africa adheres to a multilateral approach to addressing the issue of terrorism and, in this context, is committed to cooperating with the United Nations delegation," he said at the time. Since the terrorist attacks on the World Trade Centre in the United States on 11 September 2001, the Security Council has unanimously adopted a resolution that all governments criminalise assistance for terrorist activities, deny financial support and safe havens to terrorists, and share information about groups planning terrorist attacks. The 15-member CTED was established to monitor implementation of this resolution and ultimately aims to increase the ability of governments to fight terrorism. The committee has already visited several other countries including Nigeria, India and Indonesia. Interest Rate Up By 0.5 Percent Despite economists and analysts across the board forecasting a 100 basis point increase, Reserve Bank Governor Tito Mboweni June 12 raised the repo rate by 50 basis points. "In light of further deterioration in the inflation outlook, but mindful that the economy is responding to a less accommodative monetary policy stance, the Monetary Policy Committee [MPC] has decided that at this stage further tightening of the monetary policy is warranted. “Accordingly, the repurchase rate will be increased by 50 basis points to 12 percent per annum with effect from June 13 2008," said the governor. The outlook for inflation remains bleak in an environment of sustained increases in international oil and food prices. Internationally, countries are experiencing increased inflationary pressures amid slowing global economic growth and rising commodity prices. "Domestically, price increases have become more broad-based, and inflation expectations have deteriorated further." Adding to the inflation uncertainty is the impending judgement next week by the National Energy Regulator of South Africa on the proposed electricity price increases. "Consumer Price Index excluding interest on mortgage costs [CPIX] inflation is now expected to peak at around 12 percent in the third quarter of 2008 and will return to within the inflation target range by the third quarter of 2010," said the governor. The bank's previous CPIX forecast was a peak of 9.3 percent, but CPIX for April 2008 came in at 10.4 percent, compared to 10.1 percent the previous month. Sustained food and petrol price pressures were primarily but not only responsible for this trend, he said. Petrol has increased by some 30.5 percent year-on-year (y/y), whilst food prices have also risen by 15.9 percent. "Together these two categories account for over half of the increase in CPIX," he said. There were calls for food and petrol to be removed from the CPIX basket of goods, or for the basket of goods to be weighted differently. Mr Mboweni, however, said even if food and petrol were removed from CPIX, inflation would measure 6.1 percent, still above the 3-6 percent target band set by the bank. "There has been no respite from the acceleration in the international oil prices which has continued to surprise on the upside. "In recent days North Sea Brent crude oil prices reached levels of almost $140 per barrel, compared to $107 per barrel at the time of the previous MPC meeting," he said. Answering questions, the governor said while the effects of rising interest rates were not meant to "punish" anyone, people should not lose focus of the primary mandate of the Reserve Bank, which is to bring inflation back to within the target band. Rising Food, Fuel Prices Lift Inflation to 10,9 Percent Inflation rocketed to a 5½-year peak in May, beating forecasts and backing the view that the Reserve Bank will raise interest rates again this year to tame rampant price rises. Target CPIX inflation rose 10,9% year on year, up from 10,4% in April and its highest since November 2002, driven once again by the soaring costs of food and fuel. Headline consumer prices - a more comprehensive measure of the cost of living - rose 11,7%, up from 11,1% and above market forecasts for an 11,4% rise, official data showed June 25. The rand firmed 1,3% to R7,88 to the dollar after the news, which traders said sealed the case for a half-percentage point rise in lending rates at the Bank's August policy meeting. "Everyone is now back in the swing of expecting more rate hikes," said Citigroup senior dealer Julian Wilson. Higher interest rates boost the rand's "carry trade" yield appeal. With no sign of a letup in the main inflation culprits, and new electricity price hikes about to take effect, yesterday's official figures suggest CPIX will climb beyond the 12% peak predicted by the Bank earlier in June. They also showed price pressures had affected most of the goods and services monitored by Statistics SA in a trend set to bolster inflation expectations and higher pay increases. The figures did "not bode well for the inflation trajectory", said Standard Bank economist Danelee van Dyk. Eskom tariff increases would put CPIX in the "13%-14% playing field" later this year. They would also help keep inflation above its 3%-6% official target range for longer after a breach which had already lasted 14 months. "At this rate, CPIX inflation is unlikely to return to within the target band in 2010, which makes further monetary policy adjustment definite," she said. Food prices delivered the worst shock, about 17% higher than those of May last year and accounting for nearly half the overall increase. That is bad news for poor people, who spend half their money on food. Inflation for the lowest-income earners jumped 18,5%, above a 16,3% rise for the top-income group. Transport prices were the next big offender, rising 16,7% year on year after a 6,2% fuel price rise during the month. Fuel prices rose another 5,2% this month. Further hikes are in store for next month after global oil prices scaled new peaks. Efficient Research economist Doret Els said prices rose more than 6% in 12 of the 17 categories in the consumer price indices, showing inflation pressure "building on a broad front". Markets have priced in only one other half-percentage point hike in lending rates this year, which will boost prime lending rates set by banks to 16%. That would take the cumulative rise since June 2006 to 5,5 percentage points. This has begun to curb economic growth, a trend the Bank flagged as a concern. Some economists expect two more rate hikes this year, given the price pressures. Ashok Bundia, economist at Goldman Sachs, said: "We remain comfortable with our forecast that the (Bank's monetary policy committee) will continue to hike its policy rate by a cumulative percentage point before the year-end." Most emerging market countries that target inflation have failed to meet their goals this year. A rising number - including Brazil, India and Turkey - have raised rates. Electricity Price Hike 'Will Hit Economy' Inflation could exceed previous forecasts and lead to even more interest rate hikes after the National Energy Regulator (Nersa) approved a double-digit electricity tariff increase, economists say. The 13.3% increase granted yesterday adds to the 14.2% Nersa approved earlier this year. That is much smaller than the 53% Eskom had requested to fund infrastructure projects, but still far from desirable for an economy facing a tide of inflationary pressures. Making matters worse is the fact that Nersa said the cost of electricity may rise by 20% to 25% for the next three years. Economists said although the tariff hike was below what many had anticipated, the inflation horizon was nevertheless grimmer than before, which could mean that interest rates will keep climbing for longer. The market had hoped that the Reserve Bank may halt its monetary tightening cycle soon, especially after it raised rates by a smaller-than-expected margin last week. Russell Lamberti, an economist at Econometrix Treasury Management, said he now expected CPIX inflation to peak at 12.5% to 12.7 % around August this year - not 12% as the Reserve Bank had forecast. "An electricity tariff of this magnitude this year will certainly feed through strongly into inflation and quite possibly result in another 50 basis points in interest rate hikes that we might not otherwise have had," Lamberti said. Wayward inflation has led the Reserve Bank to raise interest rates by 500 basis points to 12% since June 2006. CPIX inflation - which the bank uses as a benchmark for monetary policy - has hovered outside the 3%-6% target since April last year, driven by record oil and food prices. CPIX reached 10.4% in April - the highest in almost five-and-a-half years. Reserve Bank governor Tito Mboweni said last week that any electricity price increase above 6% could further fan inflation. Noelani King Conradie of NKC Independent Economists said Nersa's decision was a reprieve for consumers, but an inflation-heavy few years could lie ahead. "Certainly from consumers' perspective, the fact that they've given a smaller increase this year would be positive in terms of disposable income. But from an inflation perspective, it's better to have it all at once because then it works out of the system in 12 months," Conradie said. "The fact that it is now roughly 25% per year means for the next three years we're sitting with high inflation Now your inflation will probably be elevated." Businesses are already feeling the strain. The South African Chamber of Commerce and Industry (SACCI) said yesterday that trade conditions had worsened in May due to the current inflation and interest rate environment and it predicted that they would continue to do so over the next six months. Fitch Revises Outlook for Country to 'Stable' Global rating agency Fitch has revised the outlook on its credit rating for SA to stable from positive, citing rising inflation, political uncertainties and a widening deficit on the country's current account -- the broadest measure of trade in goods and services. The step means that while SA's economic fundamentals are still seen as sound, the country is no longer in line for a possible upgrade to its BBB+ investment grade rating, which would have encouraged foreign investment. "It could have been worse, but I think one has to be careful," said Brait economist Colen Garrow. "This could be a signal for foreigners to lighten their holdings of South African bonds and equities." Foreigners have sold a net R9,2bn of local shares so far this year, fuelling concern about the funding of SA's current account deficit, which widened to about 9% of gross domestic product in the first quarter of this year. That was its highest ratio since 1982, according to the Reserve Bank. The widening shortfall will put more pressure on the weaker rand, which is stoking inflation, and might boost borrowing by private and public sector corporations -- forcing the country's external debt ratios to deteriorate. "Financing of the current account deficit remains a risk to the macroeconomic outlook," said Fitch sovereign director Veronica Kalema. Electricity supply constraints and infrastructure bottlenecks would curb economic growth, already restrained by higher interest rates, she said. Kalema highlighted the Reserve Bank's latest forecast that inflation would not return to its 3%-6% target range until the third quarter of 2010. "This means that interest rates will need to remain higher for longer than previously expected in order to anchor inflation expectations ... with adverse implications for growth," she said. Bullish Forecast for Mergers and Acquisitions Merger and acquisition activity (M&A) is on the rise again in SA after a subdued start in the first quarter of the year. "We're predicting an upturn," said Morne van der Merwe, a director in the mergers and acquisitions practice at Werksmans Attorneys June 18. This bullish outlook contrasts with the general gloom globally on the M&A front. Van der Merwe said his forecast was not based on wishful thinking. The firm is involved in most of the big deals that have started in the financial, mining and telecommunications sectors lately. The firm was sensing an upturn was on the way, he said. It was understandable that the first quarter was quiet because of factors such as the power crisis, subprime crisis, interest rates and political instability, he said. "But, I think the dust is settling and the deals are starting to come through now." He said that most of the large law firms were involved in mega-deals rather than mid-market deals. The mega-deals that the firm was involved in were worth billions of rands. On the other hand, mid-market transactions were worth only hundreds of millions of rands. The MTN and Reliance Communications negotiations, a deal reported to be worth about R30bn, is an example of a large deal the firm has been involved in. Other transactions include Mvela's bid for Telkom and Standard Bank's proposed buyout of Liberty Holdings. Last year, the firm was involved in M&A transactions such as advising Edgars Consolidated Stores on its acquisition by Bain, worth R25,5bn. It also advised Western Areas on its takeover by Gold Fields, worth R8,5bn. The main focus of M&A for the rest of the year is expected to be on "trade and paper" deals, Van der Merwe said. "We're probably going to see fewer private equity transactions and leveraged buyouts and more transactions involving the acquisition of companies for strategic reasons such as organic growth or market consolidation. "I think we will also see more paper deals; in other words, shares issued in the acquiring company to the target firm or stakeholder as remuneration for the acquisition, because of the high cost of capital at the moment," Van der Merwe said. Nobel Winner Warns Country On Jobs, Growth High unemployment is the biggest obstacle to SA reaching gross domestic product (GDP) growth of 6% and more, says Michael Spence, a winner of the Nobel Prize in economics and professor emeritus of management at Stanford University. With the treasury expecting GDP to come in at 4% this year, and many economists forecasting 3%-4%, the growth of the local economy has become a burning issue. The keys to growth that Spence identified were not only related to economic policy. Leadership, governance and state efficiency were crucial. "Leadership intent must be to make virtually everyone in a country better off," Spence said at the Gordon Institute of Business Science yesterday. If governments were seen to be enriching themselves or acting in the interests of a sub- group of society "the response to that almost always derails the growth process", he said. Spence was presenting some of the findings of the Commission on Growth and Development which brought together experts from several countries, including Finance Minister Trevor Manuel, to look at how high growth economies (those that had achieved 7% growth or more for the past 25 years or longer) developed and maintained their trajectories. The commission identified 13 high growth countries, including Botswana, Brazil, Indonesia, Japan, Malaysia and Malta, but not SA. Engaging with the global economy, macroeconomic stability, high levels of savings and investment, market incentives, health and education, flexible labour markets, and the protection of people from income inequality were some of the other characteristics of high growth countries. Chris Hart, economist at Investment Solutions, said the approach to growth had to be holistic -- SA could not afford to pick and choose from the characteristics that Spence had identified. He said that although the government was able to take a long- term view on the economy, it was squandering growth opportunities "through ideological battles". One such battle was over labour policies, with the domestic market being criticised for its inflexibility. "People need to be protected on income, retraining and access to basic services," Spence said. "There are two ways to protect them. Either protect the company they work for, or enhance their job mobility." One of the problems with globalisation was that in any country certain sectors would never be able to compete. But Spence said an economy going for high growth had to try to keep job creation running ahead of job destruction so that if one sector, such as textiles, was faltering, another that could pick up the labour surplus. Education and skills development had to go together with job creation and, Spence said, growth strategies also had to focus on the distribution of benefits or they would fail. People were not happy when wage differentials rose, although they were rising everywhere, particularly in SA. "People care the most about equality of opportunities. Systematic exclusion will bring the high probability that something will go wrong," he said. EU Welcomes Closer UN-AU Security Council Relations The South Africa - European Union (EU) Troika meeting has noted the strengthening of relations between the United Nations (UN) and regional bodies. "Both sides emphasised the importance of strengthening the relationship between the UN Security Council [UNSC] and regional organisations, in particular the African Union [AU], in terms of Chapter VIII of the UN Charter," the Department of Foreign Affairs said on June 3. The convening of a high-level Security Council meeting on April 16 2008, under South Africa's Presidency, to discuss this theme and specific African conflict situations was noted as an important contribution in this regard. "Both sides welcomed the unanimous adoption of Security Council resolution 1809 [2008] [which reaffirms all the UN's previous resolutions and presidential statements on the co-operation between them and regional organisations]," the department said. The Troika meeting took place within the framework of the SA-EU Strategic Partnership and was co-chaired by Foreign Minister Dr Nkosazana Dlamini Zuma and her Slovenian counterpart Dimitrij Rupel. The department highlighted that ministers welcomed and discussed areas of co-operation being developed under the Joint Action Plan, including peace and security co-operation, environment, science and technology, customs, energy, migration as well as transport. Both sides welcomed the progress made in the existing co-operation and policy dialogues and agreed that new areas for structured dialogues would be formalised during the first SA-EU Summit in Bordeaux, France, July 25 2008. With regard to various conflict situations across the continent, ministers from both South Africa and the EU condemned the recent flare up of fighting in Sudan and reiterated the importance of enforcing the Comprehensive Peace Agreement. Also, both sides called for the speedy deployment of the AU-UN Hybrid peacekeeping force to Darfur in light of the recent violence. The peaceful manner in which the people of Zimbabwe conducted the March 29 2008 election was commended and both indicated their hope for a peaceful and uncontested presidential run-off election scheduled for 27 June 2008. "... both sides underlined the importance of continued monitoring of the elections by African institutions and civil society organisations. "Ministers expressed concern about the socio-economic and humanitarian conditions [in Zimbabwe]," said the department. Country Gets Poor WEF World Trade Rating South Africa ranked an unimpressive 59th out of 118 countries in the World Economic Forum's (WEF's) Global Enabling Trade Index 2008, a report which assesses factors impeding international trade. High levels of crime and violence, the negative effect of rules on foreign direct investment and the difficulty of hiring foreign skills were some of the key factors hampering trade in SA, the report found. The release of the WEF report comes as an international panel, the Harvard Group, advising the government on growth prospects, recommended SA take a more liberal approach to trade and focus its efforts on growing exports to boost employment. Published for the first time, the report gives a cross-country analysis of measures facilitating trade. It ranks Hong Kong and Singapore as the top two economies enabling trade, followed by Sweden, Norway. Canada, Denmark, Finland, Germany, Switzerland and New Zealand in the top 10. The US was 14th. Many factors weighed down SA's performance, resulting in the disappointing ranking. The index divides the enablers into four broad "issue areas" -- market access, border administration, transport and communications infrastructure, and the business environment. While the authors laud SA for the strength of its transport and communications infrastructure, they found the country lacking in several sub-indicators of the categories of market access and the business environment. These are to a large extent areas that could be improved through policy changes. SA also performed dismally in important areas such as physical security. In the sub- category for the business cost of crime and violence, for example, it ranked 113th out of 118. In the market access cate-gory, the report rates both SA's tariff and nontariff barriers to trade as competitive disadvantages. On the efficiency of import-export procedures, SA had competitive disadvantages for the time it takes to import, the documentation needed to import and the cost to import . In the regulatory environment category, SA had poor scores for the ease of hiring foreign skills ; openness to bilateral air service agreements ; and the effect on business of rules on foreign direct investment. Africa: Continent's Progress, Challenges Discussed at WEF Five African leaders have welcomed the progress that their countries have made in recent years at the opening plenary session of the 18th World Economic Forum (WEF) on Africa. They conceded, however, that challenges still persist such as food security, the management of resources, political development and sustainable growth. "Africa is evolving very well in the correct direction," said President Thabo Mbeki, speaking at the opening plenary session June 4. The continent will continue to experience high economic growth, Mr Mbeki said, adding that regional integration will deepen. It is important to manage the resources and the wealth these countries generate so they produce the advances we need, he said. Burundian President Pierre Nkurunziza highlighted that political stability was critical. "You can have many mineral resources, but if you have no peace, there is no way to develop your country." Klaus Schwab, Founder and Executive Chairman of the World Economic Forum, told delegates the opportunities, threats and challenges Africans face require strong partnerships among government, business and civil society. Ghanaian President John Kufuor said: "There really has been progress in addressing the issue of peace and stability and democratisation. This process is irreversible. "Africa needs more cooperation through the African Union [AU] to organise and coordinate how Africa relates with the rest of the world." Mr Kufuor warned that unless leaders see beyond the divides that the colonial system left behind, they were likely to move one step forward and two steps backwards. The new Prime Minister of Kenya, Orange Democratic Movement leader Raila Odinga agreed with Mr Kufuor. "The post-election communal strife in his country that led to the creation of a coalition government underscores how tribalism remains a problem." Mr Odinga called for leaders to speak plainly and openly about the continent's shortcomings, adding that leaders must mean what they say when they talk about African development. Malawian President Bingu Wa Mutharika indicated there was a need to change the mindset from 'afro-pessimism' to 'afro-optimism'. Africa, Mr Wa Mutharika maintained, is probably the richest continent in the world but the people are the poorest. "Let us recognise that we have all the wealth to enable us to transform our continent and people from poverty to prosperity." Africa, for example, could develop the capacity to produce the food needed to address the emerging global food shortage. The continent must find its role in the global village, Mutharika added. More than 800 participants from 50 countries participate in the three-day World Economic Forum on Africa. 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Countries: Bulgaria

Posted on Tuesday, July 01, 2008 - 11:21 AM
	Crisis loomimg in Sofia, highly critical EU report The big event this summer was the publication of a highly critical European Commission report on Bulgaria on June 23 that puts the survival of the government of Premier Sergei Stanishev gravely in doubt. On June 16 President Gyorgyi Purvanov made very harsh criticisms of his own premier, the more striking because he put him in power four years age. He anticipated a very negative report and chastised Stanishev for appointing political cronies to top state industry jobs. The hinterland between industry and the state is indubitably very murky in Bulgaria, as in many countries. It is jobs for the boys, bribes galore to keep state officials happy notably tax collectors to look the other way, who belong to a very lucrative profession there. Naturally, the general population, who are finding it hard to make ends meet, are sullenly resentful of the situation. Mayor Borissov of Sofia, the head of the opposition Bulgaria for Europe Party, is likely to make great political capital out of it and push for early elections, due by 2009 anyway. BSP for the birds The irony is that the party in power is the Bulgarian Socialist Party (BSP), which is supposedly for the people. It was founded in 1891, then became the Communist Party that ruled until 1989, then reverted to being the BSP in 1990, entering coalition governments in the 1990s. This somewhat restored its democratic credentials, rather marred in the commumist period, but not for long. Despite being easily the largest party in those days, it now faces nemesis. Borissov looks to be the likely beneficiary. Other opposition parties have other ideas Bulgaria would not be a democracy, which it now decidedly is, if other people did not have other ideas. Three opposition parties, who distrust Borissov for his stewardship of Sofia as much as Stanishev for his of the country, are bonding together. LIDER, VMRO and the Agrarian Party are in intense negotiations to form an electoral bloc by the autumn. Individually their electoral showing is negligible; collectively it might be impressive. The stumbling block as always is who is to be the leader. Tax reformer supreme Meanwhile, Stanishev has been voted by the Doing Business 2008 report of the World Bank as the world's Number One tax reformer. The Socialist government has, indeed, been highly innovative in this respect, introducing the flat tax and other measures to motivate businessmen. But it is the people at large who count in a democracy. They are not so appreciative of the redistribution of wealth from the poor to the rich or the expectantly rich! Note: To read more, click here
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Countries: Bangladesh

Posted on Monday, June 30, 2008 - 11:44 AM
BANGLADESH ESTABLISHES TRUTH COMMISSION The Bangladesh government has approved the establishment of a truth commission that will help offer plea bargains to suspects arrested under its massive anti-corruption drive. The plea bargain will allow suspects to avoid jail term if they return their “ill-gotten” wealth to the state. The newly established organization is called The Truth and Accountability Commission (TAC). The Bangladesh cabinet approved this proposal at a meeting chaired by chief adviser Fakhruddin Ahmed, who heads the military-backed interim government. Persons accepting the Commission’s offer will be barred from contesting national or local elections for five years and from holding any public office and executive positions in any collective bargaining agents, associations or banks or financial institutions. The spokesman said the government will appoint the commission as soon as President Iajuddin Ahmed promulgates an ordinance allowing the formation of the body. The commission would continue for five months but the proceedings it would draw during its tenure would continue until disposal of the cases, officials said. Over 170 prominent businessmen and political leaders, including two former Chief Ministers Shiekh Hasina and Khaleda Zia were arrested by the government formed after the President imposed emergency in January last year and scrapped general elections following prolonged political turmoil. The chief adviser, however, had recently said the two detained former premiers were ineligible for the relief as they were already facing trial in courts on corruption charges. While it may be too early to predict the future of this newly established Truth Commission, the commission’s future success will probably depend on how well Bangladesh’s justice system can identify the culprits from the innocent. A well structured set of laws and punitive measure will need to be in place to prevent corrupt politicians from using the plea bargain as a way out of their criminal record. BANGLADESH DEALS WITH OLD MYANMAR REFUGEE ISSUE The United Nations refugee chief is currently in Bangladesh on Monday for a two-day visit to highlight the need to find a lasting solution for the 27,000 Rohingya refugees from Myanmar. The Rohingya refugees have been languishing in two refugee camps -Kutupalong and Nayapara - in the country’s southeastern Cox’s Bazar district for more than 16 years. Rohingyas refugees from Myanmar’s northern Rakhine state, fled to Bangladesh in the early 1990s and see little prospect of going home any time soon. This is U.N. High Commissioner for Refugees, António Guterres’ first visit to Bangladesh. During the visit, he plans to discuss the plight of the Rohingya refugees with a view to bringing some relief to this group of people. The Rohinya refugee problem is part of the world’s most protracted refugee situations. The U.N. refugee chief also plans to spend a day in Kutupalong Refugee Camp near Cox’s Bazar. Kutupalong is home to almost 10,800 refugees and during his visit, Guterres will meet with refugee women, teenagers and youth, and visit medical and feeding centers as well as inspect new housing units that are being built for the refugees. It will be interesting to see whether Myanmar’s current situation will be in taken into account in addressing the inflow of refugees in future. BANGLADESH-THAILAND BILATERAL TRADE Thailand intends to double its bilateral trade with Bangladesh to at least US$1 billion within five years. Deputy Commerce Minister, Viroon Tejapaibul, outlined this goal after meeting wit Bangladesh’s trade representatives and various authorities. The two governments also plan to negotiate on a free trade agreement to promote joint investment. Thailand has a large trade surplus with Bangladesh. Out of two-way trade worth US$525.38 million last year, Thailand’s shipments accounted for $511.16 million. Major export products included cement, fabric, yarn, plastic pellets, machinery, and chemicals. Thailand’s key imports from Bangladesh were fertiliser, pesticides, raw hides and leather, and scientific equipment. According to Mr Viroon, the relatively high trade deficit has led Bangladeshi authorities to urge the Thai government to purchase more products such as pharmaceuticals, seafood, spices and cosmetics. Bangladesh has also called for more investment from Thailand, specifically in construction, automobiles, shrimp farming, black goat farming, sugar, leather finishing, and power plants. Bangladesh is endowed with petroleum, natural gas and oil, and has relatively cheap labor. It also enjoys Generalised System of Preferences (GSP) tariff privileges as a least developed country (LCD) from developed economies such as the European Union, the United States, Canada and the Organisation of the Islamic Conference (OIC). Bangladeshi tourists spent about $2.6 billion in Thailand last year. About 13 Thai private companies already have a business presence in Bangladesh. They include CP Animal Feed and Thai Classical Leathers. Note: To read more, click here
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Countries: Taiwan

Posted on Monday, June 30, 2008 - 11:42 AM
	OFF TO A GOOD START As might have been expected, the new KMT government led by President Ma Ying-jeou and Premier Liu Chao-shiuan has moved quickly to improve relations with China although agreements reached so far have been largely symbolic and have concentrated on those areas where there is a clear win-win deal to be had. Meanwhile on the domestic front, the deteriorating global economy has given a hollow ring to KMT campaign promises to improve dramatically-and quickly-Taiwan's growth performance. Nevertheless the government has hiked the growth target for 2008 from 4.8 percent to 5.0 percent on the strength of the benefits to be had from new and improved cross-straits links. This past month, Taiwan and China held their first formal talks since such exchanges were broken off in 1999. Taiwan was represented by the semi-official Straits Exchange Foundation and China by its counterpart body the Association for Relations Across the Taiwan Straits (ARATS). Both bodies were set up in the early 1990s as a means of allowing the two governments to talk indirectly to one another but broke down over differences in 1999. They had been allowed to languish during the administration of the DPP. After two days of talks in Beijing between the two sides, a number of new initiatives were announced. These initiatives really amount to little more than confidence-building measures but they are welcome nonetheless as a sign that the sting in the relationship, that had been the hallmark of the eight years of DPP rule under former President Chen Shui-bian, has dissipated. Taiwan's staunchest ally, the United States has, for one, welcomed the agreements as a step in the right direction. So what actually has been agreed? Importantly, the first agreement announced was that China and Taiwan would set up quasi-official offices in each other's capital cities. They have agreed to allow a substantial increase in the number of mainland Chinese tourists able to visit Taiwan and to a concomitant increase in the number of direct cross-straits flights. The growth in Chinese visitors will directly benefit Taiwan's hotel and tourism industry and, in particular, small businesses within the rural economy which have for a long-time been pushing for a relaxation of tourism limits. The increase in direct flights will also benefit Taiwanese companies doing business with the mainland (which is most of them) and is a great leap forward in the direction of direct transportation links. More than 4 million Taiwanese visit China every year and for the most part have to make an indirect journey via Hong Kong. As a result of these fresh agreements, visitors from the mainland to Taiwan will climb from 1,000 a day to 3,000 a day effective immediately and with a foreshadowed further increase to 10,000 a day once circumstances allow; direct charter flights will increase from four days a year (at present such direct flights take place only during the lunar new year holiday) to 36 flights per week. Taiwan has taken a number of related but unilateral measures that will underpin the bilateral accords. Effective immediately, Taiwanese and foreign nationals holding valid travel papers will be able to enter China through the outlying islands of Kinmen and Matsu. Previously only residents of these islands enjoyed that privilege. Three of Taiwan's domestic air carriers, Mandarin Airlines, Uni Air and TransAsia have already announced plans to increase their capacity from Taiwan airports to and from these islands to cope with expected demand. In a second unilateral measure, Taiwan has announced the free exchange of the NT dollar and the Yuan. This measure is also effective immediately and so far, 13 banks which operate a total of 1500 branches have applied for permission to handle such exchanges. Taiwanese and foreign visitors will be allowed to carry out exchanges valued up to 20,000 Yuan per person per day. Initially such transactions will be restricted to hotels, souvenir shops and outlets and transactions will only be one-way: from Yuan to New Taiwan Dollars. Finally, Taiwan has relaxed restrictions on investments into Hong Kong and China by opening the domestic market to Hong Kong exchange-traded funds and by also allowing Taiwanese securities companies to invest as much as 20 percent of their net worth in China. This represents a doubling of the previous ceiling and is aimed ostensibly at rejuvenating Taiwan's capital market which has been hard hit in recent days by global volatility and risk aversion from traditional sources. These unilateral moves reinforce what has been agreed in the bilateral talks and all of them represent a step towards economic normalization and, perhaps eventually, towards political normalization. But nobody underestimates the difficulty of moving substantially further and beyond the freeing up of transportation and communication links. Much mutual suspicion remains on both sides. China continues to point its ballistic missiles at Taiwan and, for its part, Taiwan continues to seek greater freedom to manoeuvre on the international stage-although under the LMT government it may seek to do so with greater finesse than was the wont of the Chen Shui-bian government. China may not yet have woken to the fact that Taiwan is a democratic country and as much as the new government of the island does not have the same hostility to China, nevertheless it is firmly part of the democratic tradition and there is unlikely to be any winding back on that score. These moves come at a time when the promise held out by the KMT during the election campaign of reinvigorating the domestic Taiwan economy, is becoming increasingly difficult to deliver. The economy has been showing signs of slowing in recent months and in late June the TAIEX hit a five month low-its worst performance since January-thereby demonstrating that the new KMT expert team is finding it just as difficult to lift domestic growth as its predecessor. Premier Liu has acknowledged that "fixing the economy would take time," and has called on the public to have patience. Already the Cabinet has planned an economic stimulus package with a budget of NT$130.1 billion (US$4.28 billion) along with a supplementary budget that it is hoped could boost economic growth by up to 0.45 percentage points in a full year and would ease the impact of rising commodity and fuel prices. To revitalize the stock market, domestic insurance companies-which control an estimated NT$8 trillion (US$262.7 billion) in capital will be encouraged to invest in the local stock market and in local infrastructure development. Clearly the incoming government is finding that the global economy is in worse shape now than when it made its campaign promises. Already the honeymoon is over and Mr. Ma and his team are under some pressure to deliver. The government is placing much faith in the Chinese market, hoping that by opening up Taiwan to Chinese tourism and deregulating Chinese investment, Taiwan's economy will be boosted in the process. Clearly, and as one newspaper succinctly put it, the KMT cannot deliver a "new Eden." For the moment at least they have produced a new chapter in Taiwan's relationship with China and a reduction (but not elimination) of cross-straits tensions. That alone is a good start. Note: To read more, click here
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Countries: Philippines

Posted on Monday, June 30, 2008 - 11:40 AM
HOPE FOUNDERS ONCE MORE There was hope, for a while at least, that in the twilight years of her Presidency (if such they are), President Gloria Macapagal-Arroyo would be conscious of the need to secure her place in history through improved governance, professionalising the bureaucracy and addressing in meaningful way the plight of the growing number of poor. This means more quality jobs in the formal sector which, in turn, means more investment. It was a hope, but the reality is once again proving to be somewhat different. In the face of the global economic downturn which is impacting on many in the Philippines- not sending the country into recession mind you, but not likely to see a return to the high growth rates of recent times either, the government has retreated back to a "bread and circuses" approach to governance. Over recent weeks we have been treated to the farce of a rice crisis, which turned out to be no more than a price hike in line with global trends; the bloodying of the country's largest distribution utility, Meralco, as though it alone was to blame for high energy prices. Yet we have seen not a word said over the penchant of the National Power Corporation to continue to buy fuel on the spot market (where commissions are high) rather than on the basis of long-term contracts. Flexibility, it seems, comes at a high price. Next we have seen the Joint Foreign Chambers boorishly taken to task for daring to protect their own stakeholder interests, through their apparently impertinent suggestion that the government could do much to improve the investment climate -and this in a manner quite out of character with the image Filipinos like to project of being a friendly, courteous race of people (which we should add, for the most part they are). It is sad to see foreign investors treated in this unwise manner. We have seen the telcos taken on over the issue of text messages with a resurrection of the suggestion that the lot of the masa would be improved if only texting came for free. It is an interesting thought, but we don't buy it. More importantly, the business sector is downright alarmed by it. It is not exactly a productivity enhancement tool. We have seen the placebos handed out to the poorest of the poor in the form of "one time" voucher payments for food and electricity. Forget about the adage of "teaching a person to fish"-too complicated; just give him the fish and shut him up. We have witnessed the appointment of the former governor of Pampanga Province, the (now) 28-year-old Mark Lapid appointed as Acting General Manager of the Philippine Tourism Authority, a move that has been widely criticised both within the tourism sector and without. Mr. Lapid has a pending case before the Ombudsman and his term as Governor of Pampanga was mediocre at best. The present governor, Fr Eddie Panlillo who defeated Lapid in the election last year has been able to collect Php217 million in quarry taxes in the past twelve month as compared with a paltry Php29.1 million reported by Mr. Lapid. And we have seen the passage of CARP-the Comprehensive Agrarian Reform Law kicked into history, a bill that was supposed to deliver land to those who till it and which was already 10 years overdue in its implementation. Only 18 percent of the land due to be returned to the poor farmers was actually distributed! Now the landed gentry that controls Congress has successfully blocked further progress through the simple expedient of allowing the legislation to lapse. Is it any wonder that the people of the Philippines are in despair and why foreign investors also tend to look towards asset management rather than new investment? PHILLIPPINES BOTTOM OF THE INWARDS INVESTMENT LEAGUE Parse the numbers however you might, the fact is that just about every other single country in Southeast Asia is doing better at attracting investment than the Philippines. But all of this is by way of introduction to the main point of this commentary. A story tucked away in an obscure corner of a newspaper recently caught our attention more than any other event of the past week. Its significance should not be overlooked. PORK BARREL RULES OK According to this report, it appears that the Court of Appeals is caught once again on the wrong side of justice insofar as it has blocked a petition of church leaders in the town of Puerto Princessa to overturn Executive Order 683 which allows royalties and excise duties due to local government units from the Malampaya Gas field to be paid in the form of pork barrel appropriations to the Palawan Governor and two Congressmen from Palawan. Under the 1991 Local Government Code, local government units receive a total of 40 percent of taxes and royalties collected by the national governments from projects within their area. Within this total, barangays, municipalities and the province each receive a portion of the allocation which can be used to supplement their normal budget allocations and provide improved service delivery. This law is designed to provide much needed financial autonomy to local provinces and free them from the shackles of imperial Manila. This is of particular significance in the case of extractive industries such as oil, gas and mining because a two percent royalty is paid to up front government as an excise duty-a kind of point of sale tax. It amounts to a tax on gross revenue and is due to be paid as soon as the mineral (in this case oil, but it could be gold, copper or nickel) is mined and sold. The Court decision, in effect, allows the Malampaya revenues to be treated-not like taxes, but rather as discretionary appropriations for selected local officials, As such it reinforces the Golden Rule and the role of lawmakers and governors in holding sway over the rest of the province and assuring compliance when it comes to delivering the required vote at elections. The matter is now likely to go to the Supreme Court for final review on an issue which, as has been pointed out, involves both local autonomy and sovereignty. We believe far more is at stake-the credibility of the Philippines. The ineluctable conclusion is that this is once again, not a government that-faced with hard times-is seeking by all means to improve competitiveness and redistribute the wealth to those in greatest need. Rather we are seeing the all too familiar sight of the powers that be reinforcing the ramparts, better to stand the siege. We would like to draw a different conclusion but at this time we cannot. In response to the bullying tactics of certain senators during a Congressional hearing, when one senior foreign business person was told to leave the country for daring to suggest that this was not the best of all possible worlds. The executive director of the American Chamber of Commerce, said the foreign chambers would continue to be transparent in voicing their opinions on issues affecting the business climate in the country. And so they should. Footnote As this was being drafted a powerful typhoon swept through the Philippines with horrendous loss of life. While most domestic shipping companies chose to keep their vessels in port, one ferry service-with one of the worst disaster records anywhere in the world, somehow managed to slip her moorings and set sail Twelve hours later she capsized and 800 persons lost their lives. Note: To read more, click here
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Countries: Saudi Arabia

Posted on Monday, June 30, 2008 - 11:33 AM
	Is it Just a Question of Producing More Oil? Saudi Arabia has finally yielded to pressure, agreeing to produce an additional 200,000 barrels of oil per day (bpd) starting in July. This should raise the Kingdom’s production to 9.7 million bpd, the highest production level in the past 25 years. OPEC hinted that other member states might follow suit, but Iran, has already rejected adding to its output. The announcement, which came in mid-June, did little to bring down prices, which are at new record high levels, as the markets react with anxiety to any perceived or actual threat. The problem is that Saudi Arabia and OPEC were right in suggesting that increasing production would not yield any meaningful respite in the oil price. The Wall Street Journal has published a report that overwhelmingly blames market speculation to account for the rising oil price. The well known publication suggests that speculation accounts for 71% of the total number of transactions registered on the Nymex based on an inquiry made by a US congressional commission. This implies that only the remaining 29% accounts for trades aiming to cover actual oil usage. Washington is clearly under pressure to try to lower the price of oil; president Bush has put pressure on Saudi Arabia to increase production, but it also appears that Congress is growing more concerned about the role of certain investors, trying to limit their ability to speculate on oil futures. The obvious weakness with that position is that anyone anywhere can speculate, in what is an international market place, often anonymously if they choose. The US Congress ‘s writ does not run outside the USA – this is yet another weakness of governing at the level of two hundred nation states with no meaningful ,supranational authority above them. This is the sign of an important shift of thinking in the United States, which has typically insisted that the amount of oil supply, rather than the futures market is to blame. The combination of high food prices (which are also the result of higher oil prices) and spike of oil prices is now threatening to undermine national stability in various parts of the world, and is becoming a matter of national security. Countries such as Morocco, Tunisia, Pakistan, Indonesia, and Egypt to name a few, are finding it difficult to cope with the constantly rising price of oil, also because this contributes to the unprecedented costs for basic food products like wheat or meat. The social instability generated by the sharply higher prices in some countries tests social stability can serve as a catalyst for violent action in cases where the high prices are occurring in countries that have relied on subsidies to ensure order and legitimacy. In extreme reactions, the high oil price phenomenon can also be seen to contribute to terrorism. In Saudi Arabia itself, the increased strategic and monetary value of oil appears to be encouraging nefarious activity. Saudi police have arrested 700 militants since the start of 2008; the ministry of the interior said they are accused of planning attacks on the country’s oil industry and other targets. Evidently, disrupting the flow of oil to the West when prices are already at record levels is a tempting prospect for radicals challenging the Saudi royal family’s alliance with the United States. The arrested suspects come from Africa and other parts of the Middle East. Saudi Arabia has long espoused this position, challenging requests for additional production, blaming market speculation and the low US Dollar for the price of oil. Whether or not the United States introduces legislation to try to further regulate and reduce speculation in the futures market, oil producing countries are also becoming concerned that they are losing their ability to drive prices. They are no longer in full control. Not long ago, a statement from the Saudi oil minister suggesting an increase or a decrease of production would have adjusted the price of oil accordingly. In late June, the Saudis announced a production increase that did nothing whatsoever to slow the upward momentum of the price of oil. In fact, a new record high of USD 140 was reached just two days after the promised Saudi increases were announced. Oil companies met in Jeddah to come up with concerted solutions as to how to better regulate the supply and pricing of oil to assure consuming nations that their needs would be met. While futures speculators have doubtless played their part, however, part of the problem is that consumer nations have paid too little for oil in the 1990’s, so little that at prices hovering around USD 15 – 25 per barrel, oil companies and oil producing nations had little incentive to invest in new fields, refineries and new exploration techniques. Such investment is possible at current prices, but this also means that new production will not be marketed immediately such that even if speculators suddenly discovered that they had a social conscience, the price of oil will remain high for some time. The conference in Jeddah has served to diffuse the pressure on supply and producing nations, revealing the multifaceted nature of the forces driving oil prices; consumption patterns and financial speculation will be featured more prominently in the discussion. Moreover, while some oil industry analysts have accused Saudi Arabia of never actually following through on its increased oil production promises - because the added barrels are achieved by mixing a variety of oils, rather than being based on more production - the Kingdom said that it is ready to invest USD 129 billion in oil production over the next five years whereby the oil minister al-Naimi suggests annual production would move from the current 11 million bpd to 15 million bpd. In any case, whatever measures emerge from the Jeddah conference will probably only manage to contain the oil price from growing much beyond the current amount, rather than achieve an actual easing of prices. The new framework of analysis gives oil producers more room to argue other requests to increase the supply. The EU, which foresees an increased dependency on OPEC oil given the diminishing supply from the North Sea, has met OPEC representatives to achieve a general increase. OPEC considers current production levels to be well within demand, meaning the Cartel sees no viable reason to make more. Still, leading OPEC producers like Saudi Arabia are also keen to demonstrate their ability to deliver more oil when the time comes. Europe has struggled with truckers and fishermen’s strikes that are losing money because of the much higher price of fuel. Accordingly, the Saudis are also concerned that the high prices are also reducing oil demand; indeed, the International Energy Agency in its June report suggested that consumption of gasoline in North America this summer could see a 500,000 bpd reduction of oil consumption because people are simply driving less. The al-Khurais field, located 160 km outside Riyadh, is the Saudi showpiece well. Saudi Aramco is revamping the site, claiming it has a 27 billion barrel capacity of light crude, which the company believes to be equivalent to the increase oil demand from developing countries. Work on the field is already under way as contractors Schlumberger and Sinopec are already drilling and building the infrastructure using horizontal well techniques, intended to maximize output. Saudi Aramco suggests that the field would be ready to start production in June of 2009. If al-Khurais performs as well as the Saudis expect, Saudi Arabia can expect to bear the burden of responsibility as the supplier of last resort, because few oil producing countries have such lofty prospects underway to achieve dramatic production increases. Note: To read more, click here
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Countries: Libya

Posted on Monday, June 30, 2008 - 11:18 AM
The Migration Card In recent years, Libya’s importance to the European Union has grown beyond that of energy supplier. Western (and not) oil companies continue to bid over exploration rights to take advantage of a potential wide range of untapped oil deposits, but European governments are increasingly courting Libya in an attempt to reduce the flow of illegal migrants across the Mediterranean. In June, the EU approved tougher measures against illegal migrants, including longer periods of detention and more incisive deportation procedures. Nevertheless, this has not stopped boats filled to capacity from leaving the Libyan fishing town of Zuwarah, just south of the border with Tunisia, heading toward the Italian island of Pantelleria. At least two such boats have capsized in June alone, and each had at least 100 migrants aboard. Thanks to its over 2000 km. long coastline and largely unguarded 3600 km desert border, Libya serves as the principal country for the gathering of Sub-Saharan African migrants, from Niger, Chad, Mali and other countries, seeking a passage to Europe. Therefore, Libya is also the focus of European efforts to block that migration, a policy that puts Libya in an advantageous diplomatic position, particularly as far as Italy is concerned. Barely two months in office, Italy’s prime minister Berlusconi has visited Libya in June with a bag full of bargaining chips to obtain more Libyan cooperation in controlling the flow of migrants. Libya can use this request as leverage to obtain further reparations from Italy, which used to be its colonial master from 1911 to 1943. Libya has already secured ‘reparations’ from oil companies based in countries with which it has had disputes in the past. American oil companies have had to pay local authorities what has literally been called ‘re-entry rights’ in order to resume their activities in Libya. The Oasis Oil group (including Continental Oil, Marathon Oil, Amerada & Hess) is believed to have paid over USD 2 billion to the Libyan government (presumably to the National Oil Company, NOC, which is undergoing an intensive modernization process) in expectation of even larger profits. Occidental is also believed to be negotiation of its‘re-entry’ fee. Companies like ENI, which had continued to operate in Libya throughout the embargo years, have been exempted from the ‘re-entry’ fees, though they are expected to make considerable investment in the Libya’s oil infrastructure through joint-venture agreements with Libyan controlled firms. Other Italian companies that have been allowed to operate in Libya without having to pay for the privilege, such as Finmeccanica, Impregilo, and others are also benefiting. This has generated an air of expectation in Libya that Italy finally settle all its outstanding ‘reparations’ through acts of friendship, which extend from the need to shed light on all records pertaining to colonial period activities – deportations - and other war crimes. The last government led by prime minister Prodi made considerable efforts in this direction, but there were always doubts as to the ability of the Berlusconi one to follow through, given its cast of unsavoury characters - such as the now deputy minister Calderoli, whose actions sparked intense rioting in Benghazi in March 2006 in its coalition. Other European countries are taking advantage of the change of government in Italy. France and Spain have made important progress in their bilateral relations with Tripoli. Italy has to catch up and the pressure to control migration is acting as a catalyst. One of the longstanding Italian promises to Libya has been the construction of a coastal highway from Tunisia to the Egyptian border. The Prodi government had promised to act, before collapsing. The current government will have to act on it to secure Tripoli’s cooperation in contrasting the trafficking of migrants and managing migration. Berlusconi’s visit to Libya has to achieve a definitive resolution to these matters in order to obtain Libya’s commitment to help manage the illegal migrant situation. In December 2007, the then Italian minister of the interior, Giuliano Amato, concluded an accord with Tripoli stipulating that the Libyan navy would participate in monitoring the Libyan coast in boats supplied and operated by mixed Italian and Libyan crews. These patrol units have yet to start operating, but they are seen as crucial in holding back the increasing flow of migrants from Africa toward the Italian coast. Libya has also asked that Italy participate in the financing of a radar system to control Libya’s southern border. A Brewing Sahel Dispute Meanwhile, an intensifying feud involving a Touareg tribe and the government of Mali, will add even greater urgency to the sub-Saharan migration problem. The dispute began three years ago and was largely localized, but in 2008, it has started to spread across borders, creating a significant security concern for all countries sharing the Sahara, as Malian Touareg draw support from those based in other countries of the region. The mixed Touareg nationals are continuing to focus on fighting the Malian army, attacking their convoys and using landmines. Niger is one of the countries being drawn into this conflict, as some Malian army troops and officers have been captured and taken to Niger in actions claimed by the Niger Movement for Justice (MNJ). The implication, should the Touareg based tension continue to expand, is that it might lead to the demand of a separate and independent Touraeg nation. This would necessarily affect Libya as well, which has had its own Touareg revolts in the past. In the 1980s, when the Sahel experienced an intense drought, many Touareg went to Libya where, with Libyan support, they founded the Mouvement Populaire de Liberation de l’Azawad (MPLA). The MPLA returned to Mali in 1990 and prompted a revolt against the central government. Therefore, concerned Governments of the Sahel are growing suspicious of Tripoli’s role in the current Touareg revolt. Niger and Mali are convinced that Libyan leader Qadhafi is instigating the revolt, suggesting that he would even go as far as funding and controlling the formation of a Greater Touareg nation. There are even suggestions that Washington would benefit from a new Touareg nation, which would work with its AFRICOM military unit to help monitor terrorist movements in an area, the Sahel, which has received considerable attention in recent years for security matters. Given, Qadhafi’s apparent loss of appetite for Arab nationalism, the Sahel and southern Sahara could be an area of growing strategic interest, from where a friendly Touareg ally could give it leverage against Algeria to secure potential oil and gas reserves that are shared across their vast border. Moreover, greater control of the Sahel and movements of people within it would also raise Libya’s prestige and importance to Europe, which needs a partner in the region able to exercise greater control of migrants before they reach the Mediterranean shore. Note: To read more, click here
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Countries: Syria

Posted on Monday, June 30, 2008 - 11:16 AM

Will Peace with Israel Imply Selling Iran Short?
After the surprise May announcement that Syria and Israel have been engaged in peace talks brokered by Turkey, focusing on a return of the Golan (to Syria), Washington, Israel and the mainstream media have intensified their campaign against Iran. However, Syria is not yet off the hook. Damascus is still under pressure from the United States for allegedly having abetted the Iranian nuclear program through the construction of a nuclear facility in Syria, the al-Kibar site, which the Israeli air force bombarded and destroyed last September. The United States claimed that Syria was building the facility with direct aid from North Korea, which had proved its nuclear weapon producing capacity by testing such a device in 2006. Syria, unlike Israel, is a signatory to the nuclear non-proliferation treaty, while Israel remains the Middle East's only nuclear power, indeed with 150 or more nuclear warheads, it is probably the worlds third largest nuclear weapons power.

Suggestions are being made by the German weekly, ‘Der Spiegel’, quoting German intelligence: Al-Kibar was, says the report, to be a military project involving Syria, Iran and North Korea (conveniently, the ‘Axis of Evil’ in full) whereby Iranian nuclear scientists were being backed by those of the other two players offering additional expertise on how to build a nuclear weapon. Al-Kibar, now being inspected by the IAEA was to serve as the facility where such a device was to have been built. An alternative and completely different theory regarding al-Kibar being considered by Israeli security advisors, is that it was intended to supply Iran with spent nuclear fuel that would be reprocessed into plutonium. Perhaps the usually reliable IAEA judgement when it comes, will be nearer to the truth.

What Nuclear Weapons?
For the record, Syria has vehemently denied that it ever had any nuclear weapons program and repeatedly suggested that al-Kibar was just a simple military storage facility – which, it should be noted, was left entirely unguarded and unmanned in the middle of the desert. We speculate that the IAEA will report no evidence of any nuclear fuel or materials on this site, in which case what would make it a ‘nuclear site’? Time will tell.

Whereas the United States has not linked the alleged Syrian nuclear program to Iran, Israel appears to be promoting the idea that Iran is the ‘deus ex-machina’ prompting Syria to share in its nuclear ambitions. It would appear as if the Israeli government is trying to offer Syria a viable exit strategy in order to pursue and justify the ongoing peace talks with the USA and with the conservative opposition in the Knesset. Israel is purposely shifting the blame for al-Kibar toward Iran, as if to suggest an “Iran made me do it” scenario, whereby Syria was coerced to participate in what is an Iranian scheme under the terms of their alliance. Indeed, German intelligence told ‘Der Spiegel’ that Syria’s president al-Asad was uneasy about backing Iran’s nuclear program.

While speculation continues on what if any ‘nuclear weapon’ producing capacity was being pursued at al-Kibar, Israel would appear to be winding –up in preparation for an attack against Iranian nuclear facilities. The September raid against Syria served as a warning of Israel’s ability to penetrate undetected in enemy territory and reach important targets. It was at the least a practice run. The Israeli air force conducted another practice run in June, with airborne refuelling to show that it can cover the distance needed to reach the Natanz nuclear reactor in Iran, as Israeli pilots practiced flights involving distances approximating those needed to reach Natanz from Israel, leaving little doubt as to the message this implies for Tehran.

What does Syria Gain?
On the other hand, in mid-June, Syrian and Israeli negotiators met again in Turkey to pursue the peace treaty that was leaked in May. Despite some weakness in the Israeli government, due to the political financing scandal involving prime minister Olmert, the talks are proceeding, giving added credibility to the potential for peace between Syria and Israel. France’s minister of foreign affairs Bernard Kouchner added optimism, suggesting that Syria’s president Bashar al-Asad and Olmert would meet in Paris on July 13 to discuss the peace agreement directly. Syria’s invitation to France marks a clear break with the policy pursued by France’s previous administration, after the assassination of Lebanese prime minister Rafiq Hariri.

The July 13 invitation also coincides with the launch of Sarkozy’s Mediterranean Union initiative, which promotes greater cooperation in matters of security, economy, energy and m