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Posted on on June 10th, 2014
by Pincas Jawetz (


The title of the Second Correction of Second Correction – of June 1, 2014 –  to this article was:  “The Party of European Socialists …” for the backing of President for the New European Commission – as we find out serially that this will not be Brussels reality. Now it is crystal clear that the UK, with one foot in the US and one foot in the EU, will just not allow the creation of a strong EU that can become World Power at equal level with the US and China. The UK Prime Minister David Cameron takes cue from the anti-EU UKIP party that won the elections for the European Parliament in the UK, and organizes the resistance to those that represent the two major parties in the European Parliament by insisting that the new Commission has to be dominated by the Member States rather then by their people/citizens. This is nothing less then a hold on to the power that the Parliament was voted to wrestle out from them.

With this reality in lead we lose all hope that the EU can become anything more then the window dressing to a bunch of 28 rather small States united in form but not in fact. This will not lead to the stability that more enlightened Europeans were envisioning.

Our hope now is that the Scots do indeed vote for independence and become their own EU members reducing England to its correct position as an ally of the US and a candidate to join the the United States of America instead. That is what they want and that is what they deserve. The European continent will then be allowed to unite in its own interest and perhaps Russia would then be able to consider its own interest in realigning with it in a Eurasian Economic Union from Lisbon to Vladivostok that can hold the line versus China on its Eastern borders.


Merkel and Cameron in battle over European Commission.

(L-R) Dutch PM Mark Rutte, German Chancellor Angela Merkel, British PM David Cameron and Swedish PM Fredrik Reinfeldt an informal meeting on 9 June 2014 in in Harpsund, Sweden. Swedish PM Fredrik Reinfeldt (far right) is hosting the wide-ranging talks at his summer residence in Harpsund

The leaders of Sweden, Germany, Britain and the Netherlands are meeting at a mini-EU summit near Stockholm to try to reach a consensus on European reform.

The controversial question of who is to head the European Commission is likely to be discussed, but not officially.

UK PM David Cameron is expected to try to get leaders on-side to block Jean-Claude Juncker taking the job.

It sets him against German Chancellor Angela Merkel, who publicly supports the ex-Luxembourg leader’s appointment.

Few details from the summit have emerged. However, job creation, institutional changes in the EU and structural reforms to boost EU competitiveness were said to be high on the agenda.

The UK, Sweden and the Netherlands are leading a campaign to block Mr Juncker’s candidacy, which has the support of the largest centre-right political grouping in the European Parliament, the European People’s Party (EPP).

David Cameron, Angela Merkel, Fredrik Reinfeldt and Mark Rutte talk in a boat near the summer residence of the Swedish Prime Minister The four leaders took to the river for a spot of relaxation before the talks began in earnest

Ahead of the two-day talks that began on Monday, Mr Cameron said he had the support of “all major UK parties” in opposing the appointment.

He also spoke to the prime ministers of Italy and Hungary, Matteo Renzi and Viktor Orban, by phone to discuss the matter, Reuters reports.

The BBC’s Ben Wright, in Harpsund, said the scene was set for a lengthy power struggle between EU leaders and the European Parliament over the appointment with the UK worried about the prospect of a “stitch-up”.

A news conference on the outcome of the talks is scheduled for 08:00 GMT on Tuesday.

Role of commissionMr Cameron is strongly opposed to Mr Juncker’s belief in a closer political union between EU member states and has described Brussels as “too big” and “too bossy”.

His hand was strengthened on Monday when the UK opposition Labour party said its MEPs in the European Parliament, which must approve the choice by EU leaders, would vote against Mr Juncker.

On arrival in Sweden, Mr Cameron said it should be EU leaders and not the European Parliament who decide who will head the commission.

Swedish Prime Minister Fredrik Reinfeldt also dismissed the idea of a stronger role for the European Parliament.

“We in principle dislike the idea of presenting front-runners from the different parties because we think that twists the balance between the institutions and the way that the Lisbon treaty is set up,” he said.

More discussions were needed on the role of the EU commission before looking at names, he added.

Angela Merkel and Jean-Claude Juncker The German chancellor has given Jean-Claude Juncker her backing 

Juncker: For and againstAngela Merkel: German chancellor, after some hesitation, backed European People’s Party candidate. Some in Germany believe she may be willing to discuss alternatives

David Cameron: Opposed to former Luxembourg PM’s candidacy – said to see him as a “face from the 1980s” who cannot solve the problems of next five years

Fredrik Reinfeldt: Seen as opposed to Mr Juncker and reports in European media suggest Swedish prime minister himself could be compromise candidate

Mark Rutte: Opposed to Mr Juncker, and Dutch PM due to meet Irish prime minister after Swedish summit to discuss alternative candidates


Dutch PM Mark Rutte told reporters that it was premature to put forward names for who should replace Jose Manuel Barroso as head of the commission.

“My belief is that we should first focus on content, discuss what the new commission should do… then discuss who fits that profile,” he said.

Mrs Merkel said the four leaders would not make a final decision on who they would back, adding that her position was well known.

EU leaders have traditionally named the commission head on their own, but new rules mean they now have to “take into account” the results of the European Parliament elections.

The EPP grouping, of which Mr Juncker is a member, won the largest number of seats in May’s polls, and he has argued that that gives him a mandate.

The decision will be made by the European Council – the official body comprising the 28 leaders – by qualified majority vote. That means no single country can veto the choice.

The decision is expected at an EU summit on 26-27 June although an agreement by then is by no means guaranteed.

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The first Correction title was: “Correction to “The Party of European Socialists that backs Martin Schultz for the European Commission presidency seems to have an advantage in the building of a ruling coalition for the EU” – but we found out that this will not be Brussels reality.”  But after 3 days even that title was overtaken by real Brussels life as directed from the 28 Member States’ Capitals – and even some non-member States as well —- Perhaps.

Turns out that while the great gains of the parties of the Right introduced to the EU strong elements that came to undo the EU – these parties will have a hard time creating a new faction in the EU Parliament. In effect there might be two such factions – one based on a UK-Hungary alliance and the other on an Austria-France alliance. Nevertheless, the Black and Red factions are afraid of this invasion of their previously calm and inactive EU. Rather then gearing up for strong leadership – seemingly they are opting for a united front like it is the Austrian Government norm. It loooks that the Austrian Chancellor Mr. Faymann (a Red) initiated this effort by saying he backs Mr. Jean-Claude Junker (a black)  for the position of the New President of the New European Commission, because he got the largest number of votes.

Perhaps this was done in agreement with other heads of State or Government, we will never know, but what we know is that Mr. Junker then turned around and suggested Mr. Martin Schulz, the candidate of the reds, the holder of the second largest number of votes and mandates, should be his only Vice President. In this case the Denmark Prime Minister Helle Thorning-Schmidt could replace Mr. Van Rompuy as permanent head of the European Council which according to protocol is the highest EU position {sort of a Senate to the Parliament’s similarity to a House of Representatives}.

Denmark is outside the EURO group and could thus be a bow to the non-Euro States. Similarly the Poland’s Foreign Minister, Mr. Radoslaw Sikorski is being mentioned as a professional, for replacing Lady Catherine Ashton at the EU Foreign Policy desk. Let us see if this short list will be the final one in what has become negotiations run from the Capitals rather then the one we thought will be handled directly by the heads of fracctions based in Brussels.

The Alliance of Socialists and Democrats won only 193 seats in the Parliament and is second largest faction to the 211  member European People’s Party, but when analyzing the rest of the colors’ pallet they seem to have an advantage when judging the potential for coalition building in the 752 member Parliament. A majority means having 376 votes. 

The news of these elections is the emergence of Euro-skeptic parties and Right extremists that are outside the reach of the two rather centrist contenders for heading the new Parliament who will eventually head also the Commission – being something akin to a first EU President. Extreme right and EU skeptists just do not fit in – and that was the target of those that stood up to their home governments anyway.

The two largest blocs that are positioned between the EPP and the S&D – the ALDE liberals and the Greens, amount together to 132 mandates, and they are much closer to Martin Schulz of the S&D who wants to introduce change with a more socially oriented set of policies, then to Jean-Claude Juncker of the EPP who would mean more of the same and a continuation of the policies that allowed the EU to fall into an economic crisis that was set up in the US.

If indeed the two parties mentioned join Martin Schulz, and yesterday I learned from Mr. Gerhard Schick of the German Greens that this is in the cards, then Schulz presents himself as the head of a 325 bloc, which makes it easier for him then for Junker, to reach out to the magic 376 number, or at least be indeed the leader of the largest bloc if it has to be a minority rule.  

Juncker stakes claim to EU commission’s top job  – might thus be premature.

We wonder if all new Members of the European Parliament already packed their suitcases and are off to Brussels to do there the negotiations that eventually will lead to the real results.

EU wakes up to Eurosceptic hangover.
26 May 2014
The EU’s mainstream political parties will move quickly to re-establish themselves as the voice of the European parliament, following EU elections that saw a significant increase in support for Eurosceptic, extreme right and anti-establishment parties.

PES say Eurosceptic election swing sounds ‘warning bell.’

Written by Martin Banks on 26 May 2014 in News – The Parliament Magazine.

Party of European Socialists president Sergei Stanishev has conceded that the rise of far right and Eurosceptic parties in the elections sounds a “warning bell” for the political elite.


Martin Schulz and Sergei Stanishev at a Party of European Socialists event in the European parliament

Speaking at a news conference in parliament on Monday, the former Bulgarian prime minister said the big gains for such parties was “not so much about European politics but more about national policies and a protest vote”.

He went on, “The fact that parties like Front National and UKIP, which won more votes in the UK than another other party, can gain such support do so well is very serious and cause for concern. It should sound a warning bell to other parties and send a message that European people want change.”

“The EPP is the party which has run Europe for the last 10 years during the economic crisis and they were the big losers even though they remain the biggest group in parliament” Sergei Stanishev

Stanishev said the “big losers” in the election were the EPP, which he said had lost 60 seats and seen its share of the vote fall by some 20 per cent compared with the 2009 elections.

“The EPP is the party which has run Europe for the last 10 years during the economic crisis and they were the big losers even though they remain the biggest group in parliament.”

He said the Socialist vote share had remained stable compared with five years ago but voiced veiled disappointment that it had not done better. Even so, he said he was confident the party remained well placed to achieve its objectives in the next legislature, including further regulation of financial markets.

He also praised his colleague, German MEP Martin Schulz, a candidate for the commission presidency and parliament’s president, for an “outstanding” electoral campaign, saying he had “reached” 150 million citizens via social media. “His profile is now even bigger than it was before the election.”

Stanishev. who has led the Bulgarian Socialist party since 2001, also insisted that member states must “take account” of the outcome of the vote in deciding the next commission head, adding that, on this, he believes PES are in a “stronger position” than the EPP.

Addressing the same conference, PES general secretary Achim Post said, “It is now up to the political group leaders to form a ‘stable’ majority and the Socialists will play a decisive role in this.”



Above is good for a Europe if it wants to be seen as a post-Nationalism Union that gives preference to ideas over National identity.  But then, Mr. Junker does not get yet free sailing as members of his own European Party – from the UK, Hungary, and Sweden seem to prefer alternatives from inside the EPP  – names from Finland and Italy being mentioned.

The political juggling seems even more interesting when the other positions to be filled are taken into account.

As possible  compensation for Mr. Schulz getting himself out of contention – he might then get to be the German Commissioner – although one would have expected someone closer to the German Chancellor. Austria seems to follow the German example with the Red Party Chancellor from the Red Party declaring his backing for the candidate of the Black Party as he got more votes. This opens the question whom will he support for Commissioner from Austria?

With a Catholic holiday on Thursday there is no chance now that the Parliament will have a prospective winner before the end of this week,  another week of politics is still in the cards, and in effect it might take all of the month of June.

Also, if Mr. Junker does not get full backing from his own party and does not reach a majority – then according to Parliament norm the ball is passed to the second largest faction and that is Mr. Schulz – so it might be that the wheel might still turn in his direction. Seemingly Mr. David Cameron, the British Prime Minister, has the ropes in his hands – but in mind he has the success  the anti-EU UKIP party had at these elections. Similarly France is looking at the success the Le Pen Front National had on Sunday. Does this mean that these two EU members are now favoring a weakened EU because this seemed to be the wish of their countrymen?

The French Christian Democrat Joseph Daul is leading the Black Faction negotiators and Austrian Commissioner Hannes Swoboda is leading the Red Party negotiators with outgoing Head of the Parliament, the Belgian Hermann Van-Rompuy the address of their efforts. Who will get his job? Could it be that this position will go to the Commissioer from Poland – Ms. Danuta Hebner?




About the author:   Martin Banks is a veteran freelance, Brussels-based journalist specialising in European politics.


Posted on on May 18th, 2013
by Pincas Jawetz (


    Some member states rely on Gazprom for 80 to 100 percent of their gas consumption

EU Agenda for the May 20, 2013 week –

EU leaders discuss energy and tax next WEEK.




By Nikolaj Nielsen


BRUSSELSEnergy and tax policy are on next WEEK’s agenda as European leaders gather in Brussels for a summit
on Wednesday (22 May).

Member states want to harvest an estimated €1 trillion lost every year to tax evasion.

It is hoped the additional funds will help alleviate a social and economic crisis that has put millions out of work.

Among the proposed solutions to help fill the state coffers is the automatic information exchange of bank account details.

Energy is also up for discussion.

Leaders are expected to focus their attention on completing the internal energy market, boosting investment in energy infrastructure, and reducing high-energy prices.

The European Commission says energy import dependence has increased in last two decades and estimates the demand for oil and gas will increase by more than 80 percent by 2035.

Commission chief Jose Barroso said the fragmented EU energy market is driving up energy prices for both consumers and businesses. He said the internal energy market must be completed through existing legislation to bring down the costs and boost revenues.

“Our discussion [at the summit] should build on February 2011 conclusions and take our policy forward,” he said in a speech in early May.


Meanwhile, euro-deputies are in Strasbourg for their plenary session.

The MEPs on Tuesday will issue resolutions to urge member states to halve the €1 trillion in uncollected taxes by 2020.

Banking supervision is also on the plenary agenda on Tuesday.

The parliament says a final vote will be postponed until it can resolve accountability issues with European Central Bank.

A vote on a draft resolution on media freedoms and pluralism is scheduled on Tuesday. Deputies the same day will also approve the new dates of 22 to 25 May for the 2014 European elections.On Wednesday, MEPs will debate the upcoming US-EU free trade agreement with EU trade commissioner Karel de Gucht.

The commission, for its part, is set to adopt on Thursday a proposal by EU transport commissioner Sim Kallas on maritime ports in Europe.

Digital commissioner Neelie Kroes is also set to present a strategy on micro-electronics and nanotechnology on Thursday.


Posted on on April 4th, 2013
by Pincas Jawetz (

The following is a presentation of facts that cannot be ignored anymore. Deserves close reading by those in the North that thought you can bumble your way through without creating a real union capable of calling out “it is all for one and not just one for all!” The EU is not just the fulfilling of the German dream of takeover of Europe by peaceful means. Cyprus dreaming of being the Mediterranean base of Russia? What else? Austria a bridge to the East? Yes, but only after twinning up with Finland.
The article does not mention the UK even once – we interpret this as a sign it has crystallized as the island off-shore that ought to partner with the US and stop bothering the decision making process of the continent at large.
It was the UK interest that created Cyprus in the first place by not letting it split and join Greece and Turkey. Who needed two weak Greek States in the Union? Malta? another UK invention? Slovenia was good – why not also a Catalunya or Catalonia?


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A Line Of Demarcation Through The Eurozone Is Taking Shape

Wolf Richter*  

Everyone learned a lesson from the “bail-in” of the Cypriot banks: Russian account holders who’d laundered and stored their money on the sunny island; bank bondholders who’d thought they’d always get bailed out; Cypriot politicians whose names showed up on lists of loans that had been extended by the Bank of Cyprus and Laiki Bank but were then forgiven and written off. Even brand-new Finance Minister Michael Sarris who got axed because he’d been chairman of Laiki when this was going on. His lesson: when a cesspool of corruption blows up, no one is safe. And German politicians learned a lesson too: that it worked!

“With the Cyprus aid package, it was proven that countries like Germany, the Netherlands, and Finland, if they stick together, are able to push for a strict stability course,” Hans Michelbach told the Handelsblatt. The chairman of the finance committee in the German Parliament and member of the CSU, Chancellor Angela Merkel’s coalition partner, called for deeper collaboration of the triple-A countries in the Eurozone “to strengthen the confidence of citizens and investors in the common currency.”

There are still five in that euro triple-A club: Germany, Austria, the Netherlands, Finland, and Luxembourg. “It would be good if we could also convince Luxembourg to participate more strongly in this stability collaboration,” he said. It would be in the best interest of Luxembourg as major financial center, he added. A reference to Luxembourg’s precarious status, as Cyprus had learned, of being a tiny country with banks so large that it can’t bail them out by itself.

To protect the euro, the alliance of the triple-A countries must be united firmly against large euro countries like Italy and France, he said. “Strong signals of stability would be of great importance for the Eurozone,” particularly now, given the “unclear situation” in Italy, renewed doubts about Greece, and the failure of the French government in its stability policies.

Exactly what French President François Hollande needs: the euro triple-A club breathing down his neck. He’s already in trouble at home. To reverse the slide, he got on state-owned France 2 TV last Thursday to speak to the French people so that they could see how his sincerity, wisdom, and economic policies would stop the country from sinking ever deeper into a quagmire.

And a quagmire it is: double-digit unemployment, a Purchasing Managers Index just above Greece’s, new vehicle sales that plunged almost 15% so far this year, a budget deficit that refuses to be brought under control…. He has tweaked some policy measures here and there. And he dug up a new version of the 75% income-tax bracket that had been squashed by the Constitutional Court. But Jérôme Cahuzac, the Budget Minister who’d tried to get the first version through the system, went up in flames over allegations of tax fraud and “tax fraud laundering.”

Now the people have had it. After the TV appearance, his approval rating, ten months into his term, plummeted another 6 points to 31%, a low that scandal-plagued Nicolas Sarkozy took four years to reach. And only 27% approved of his economic policies. “The French simply don’t want austerity,” lamented an unnamed government insider.

France was suffering the consequences of the “socialist experiments” of its government and was becoming less and less competitive, explained Michelbach. He emphasized that France would remain an important partner of Germany. He wasn’t kidding: France buys 10% of Germany’s exports and is crucial to the German economy. But if France didn’t change course, he said, that could become a “serious problem” for the Eurozone.

As opposed to the mere hiccups of Cyprus or Greece. More banks and more countries will require bailouts­Slovenia, Spain, Italy, and Malta are on the list. And no one wants to see France on that list. Even Italy is too large to get bailed out by other countries­though it’s rich enough to bail itself out, à la Cyprus [ A “Politically Explosive” Secret: Italians Are Over Twice As Wealthy As Germans].

But in Germany, a revolt against these save-the-euro bailouts has been brewing for a while. With elections in September, it’s taking on volume and voices, and the structure of a political party, the Alternative for Germany, not unpalatable radicals but the educated bourgeoisie, and they want to stop the bailouts and dump the euro.

The government is feeling the heat. No one can afford to lose votes. Michelbach’s triple-A club, a line of demarcation in the Eurozone, is one of the reactions. Merkel might benefit from it in the elections. The other four countries might find if appealing, though it will be of dubious appeal in the rest of the Eurozone. But if efforts fail to fix the Eurozone’s problems­and the Eurozone lumbering that way­a tightly knit triple-A club could weather the storm together, more stable and more unified than the Eurozone ever was. And Michelbach had just floated a version of that idea.

Every country in the Eurozone has its own collection of big fat lies that politicians and Eurocrats have served up in order to make the euro and the subsequent bailouts or austerity measures less unappetizing. Here are some from the German point of view…. Ten Big Fat Lies To Keep The Euro Dream Alive


Wolf Richter wrote also – “White House Hypocrisy And Trade Sanctions Against China.” –  Practically every car sold in the US contains Chinese-made components. But suddenly, in the middle of a heated presidential campaign, the Obama administration decided to do something about it.

Wolf Richter is a  San Francisco based executive, entrepreneur, start up specialist, and author, with extensive international work experience.

In… he explains “Having worked a bit on international deals, and for companies operating in foreign markets, cross border transactions have an even lower success rate than domestic ones. The big reason is the one mentioned here, which is marked cultural incompatibility between the seller and buyer. Here the Chinese did less badly than they could have (they could have tried forcing Chinese practices on the German operation, which would have destroyed the value of the asset). But the logic of the transaction was unclear. Was it technology transfer? Consolidation? It appears both might have been goals, and neither happened very much.

But I find it intriguing that as lousy as the Japanese were at doing deals  (they found it hard to understand that the contract was the deal, and were too inclined to overpay), they were good at managing workers in manufacturing operations (service businesses were another kettle of fish, there they tended to drive Americans crazy).  This is a skill the Chinese will have to master, since they desperately need to re-invest their surpluses, and they are trying to acquire more real-economy assets.”    FASCINATING.

His insights in Wall Street machinations are also very good.




Posted on on April 30th, 2012
by Pincas Jawetz (


The global employment situation is alarming, says a new United Nations report released today, which also warns that recovery is not expected any time soon.

The World of Work Report 2012: Better Jobs for a Better Economy – published by the UN International Labour Organization (ILO) – says that around 50 million jobs are still missing compared to the situation that existed before the global economic crisis.

It also warns that the global jobs crisis is likely to get worse due to several factors, including the fact that many governments, especially in advanced economies, have shifted their priority to a combination of fiscal austerity and tough labour market reforms.

Such measures are having “devastating” consequences on labour markets in general and job creation in particular, ILO stated in a news release.

“The narrow focus of many Eurozone countries on fiscal austerity is deepening the jobs crisis and could even lead to another recession in Europe,” said the Director of the ILO Institute for International Labour Studies and lead author of the report, Raymond Torres.

“Countries that have chosen job-centred macroeconomic policies have achieved better economic and social outcomes,” he added. “Many of them have also become more competitive and have weathered the crisis better than those that followed the austerity path. We can look carefully at the experience of those countries and draw lessons.”

Another factor leading to a worsening jobs crisis is that many jobseekers in advanced economies are demoralized and are losing skills, something which is affecting their chances of finding a new job. In addition, small companies have limited access to credit, which in turn is depressing investment and preventing employment creation.

“In these countries, especially in Europe, job recovery is not expected before the end of 2016 – unless there is a dramatic shift in policy direction,” according to ILO.

Other factors include the fact that, in most advanced economies, many of the new jobs are precarious and there exists the possibility of increased social unrest in many parts of the world. According to the report’s Social Unrest Index, 57 out of 106 countries with available information showed a risk of increased social unrest in 2011 compared to 2010. The regions with the largest increases are sub-Saharan Africa and the Middle East and North Africa.

The report argues that if a job-friendly policy-mix of taxation and increased expenditure in public investment and social benefits is put in place, approximately two million jobs could be created over the next year in advanced economies. {please remember Krugman and Stiglitz articles – see how vindicated they are!}

Among the other findings of the report is that employment rates have only increased in six of the 36 advanced economies since 2007 – Austria, Germany, Israel, Luxembourg, Malta and Poland – and that youth unemployment rates have increased in about 80 per cent of advanced countries and two-thirds of developing countries.


Posted on on August 11th, 2011
by Pincas Jawetz (

These states are:

Three of them are – The UK, Isle of Man and Jersey Island – Like the Isle of Man, Jersey is a separate possession of the Crown and is not part of the United Kingdom.[



and HONG KONG that sits on the rib of China.

Of these France seems to be next State to fall of this economists’ tree of life.


Posted on on May 31st, 2011
by Pincas Jawetz (

Roberto Foa has his BA in Philosophy, Politics and Economy from Oxford, and his and his MPhil from Jesus College, Cambridge.  In 2004 he was selected as a Peter Martin Fellow at Financial Times. He wrote –
“Before arriving at the Financial Times I was a consultant with the Future Foundation, where I had worked with BP, Defra and the Social Exclusion Unit. Prior to that I worked with the China-Britain Business Council in Shanghai and edited a webzine in Paris.”

Since 2006 he has been working in Washington DC towards creating the Social Development Indicators Project, which is a study being conducted on the relevance of social institutions and their effectiveness.
In 2007 he served as the coordinator for the World Values Survey in Rwanda.
He has Published in the Financial Times and consulted for various government projects.
He writes about economic integration, trade, and Europe’s ties to the world.
He has authored many papers and contributed to many chapters and books covering topics of social capital, democracy, and economic development.

Roberto Foa is now a doctoral researcher at Harvard University, Department of Government, Center for European Studies, and further information given out there:

Contact Information:
E-Mail (work):
Website: “Merchant of Venice” blog on EU Observer

Biographical Statement: Foa came to Harvard from the World Bank in Washington DC, where he was founder of the Washington European Society He is currently author of the “Merchant of Venice” blog on EU Observer, a consultant to the Club de Madrid, and has published a wide range of academic and journalistic articles covering such topics as democratization, economic policy, and institutional reform in the European Union. He is involved in research projects on the legacies of European colonialism, democratic consolidation in post-communist Europe, and in the European and World Values Surveys.

The following was posted as… on May 31, 2011.

Why a European at the IMF?

After initial excitement that the resignation of Dominique Strauss-Kahn might lead to an emerging market candidate to follow him as head of the IMF, Europe has placed its seal firmly upon a successor – Strauss-Kahn’s own distant replacement as French Minister of Finance, Christine Lagarde.

At first glance, the insistence on a European candidate may seem odd. After all, even if the shareholders of a major company, such as Louis Vuitton, all come from a particular area – say, the western suburbs of Paris – they would be crazy to insist on having a CEO from the same neighbourhood. Their interest lies in finding the most competent person for the job. They are likely to search far and wide to find that person.

A similar logic may apply to the IMF, where European countries already have the lion’s share of the votes. Whoever becomes managing director will be responsible to Europe’s directors on the Board, so why insist on having a European to serve them?

The real reason, of course, is political. Europe needs a European to run the IMF, because in the absence of easy credit from the International Monetary Fund, the euro area is politically incapable of arranging and taking responsibility for its own eurozone rescue package. Moreover, even if it were thus capable, many believe that it is not in the best interests of the eurozone to do so.

Let us unpack this a little further. The need for a European to shepherd through easy credit is simple enough: most of the IMF’s lending is now in the European neighbourhood, including also non-eurozone countries such as Hungary, Ukraine or Iceland. The IMF package for Greece, at €30bn, was already the largest in its history, and the package for Portugal, approved last week, added another €26bn. A similar package for Spain could add over €100bn. Italy could be twice as large still. These are vast amounts, and will be hugely controversial if and when they arise. A non-EU director might not be inclined to jeopardise such sums.

Yet why cannot the eurozone arrange its own bailout mechanism? After all, rather than rely on the IMF for financing, Europe could very well establish its own “European” monetary fund, funded by Germany, France, and the Netherlands. Indeed, this is in part what the EFSF and the future ESM are intended to accomplish. However, as I have discussed long ago, the reality of a “European” Monetary Fund would spell death for the project of European integration. It would mean core European nations taking direct responsibility for implementing austerity policies in the eurozone periphery, and taking the resultant political flak. EU nations simply do not have the ‘political capital’ to dictate harsh spending cuts in neighbouring countries, unlike the IMF, which does so as a matter of routine. By shifting surveillance of austerity packages during their most difficult period to the Fund, the core Eurozone countries are able to continue dictating the agenda, but via the front of an international organisation with greater credibility, manouverability, and anonymity.

But what about simply allowing Greece and Ireland to default? After all, under the present Eurogroup and IMF packages, Greece and Ireland can neither pay off their debts, nor default on them, and are thus maintained in permanent debt servitude. Is this not a terrible policy failure?

The answer is no, insofar as these packages were never designed to save Greece and Ireland in the first place. Rather, their purpose is to save the eurozone banking system from collapse. The key beneficiaries of this long, drawn-out process are Dexia, BNP Paribas, and Commerzbank, and behind them, the French and German governments who currently insure their losses. Everyone knows that eventually, Greece and Ireland will have to default, but if they do so in two years time rather than today, then this gives eurozone banks enough time to transfer their assets to the European Central Bank, while shoring up their capital base ahead of the impending haircut. Leaving aside the problem of ECB recapitalisation, this means the contagion effect will be minimised: at the very least, it will not least to the wholesale meltdown that would have occurred if a default were effected today, say, or last summer.

Europe therefore needs a European to run the IMF: but not for reasons of competency, or familiarity. Rather, it is because the eurozone is incapable of fixing its own problems, and requires a candidate pliant and willing enough to take the controversial decisions needed for the currency bloc’s survival. Even, one might add, if such decisions may be perilous for the IMF itself.


What above translates to in our mind is that better forget the UN – IMF linkage. The evolving economies that really count – China, Brazil etc. better leave the IMF to the Europeans who anyhow use it for their own purpose mostly – this so the fiction of an EU and an EURO can be continued rather then face a splintered multi currency situation in Europe that will cause further havoc in World trade, and pass early the responsibility for managing such trade to China.


Posted on on October 11th, 2010
by Pincas Jawetz (

The attention in Washington, as pointed out by Steve Benen of Alternet bloggers, was on British Foreign Secretary William Hague, a prominent conservative leader in the U.K., who in the U.S. last week  described climate change as perhaps the 21st century’s biggest foreign-policy challenge,” He stated – “An effective response to climate change underpins our security and prosperity.”

His strong words make it easier to recognize that Republicans in this country are coalescing around a uniquely dismissive position on climate change. The GOP is stampeding toward an absolutist rejection of climate science that appears unmatched among major political parties around the globe, even conservative ones. […]

Just for the record, when the nonpartisan National Academy of Sciences last reviewed the data this spring, it concluded: “A strong, credible body of scientific evidence shows that climate change is occurring, is caused largely by human activities, and poses significant risks for a broad range of human and natural systems.” Not only William Hague but such other prominent European conservatives as French President Nicolas Sarkozy and German Chancellor Angela Merkel have embraced that widespread scientific conviction and supported vigorous action.

Indeed, it is difficult to identify another major political party in any democracy as thoroughly dismissive of climate science as is the GOP here. Eileen Claussen, president of the Pew Center on Global Climate Change, says that although other parties may contain pockets of climate skepticism, there is “no party-wide view like this anywhere in the world that I am aware of.” notes Ron Brownstein in the Washington DC National Journal.

As the climate crisis intensifies, and the need for swift action becomes even more painfully obvious, the GOP line is getting worse, not better. How many Republican U.S. Senate candidates on the ballot this year support efforts to address global warming? None. It looks as if there was a unanimous Republican opposition to any meaningful efforts to combat global warming. This makes any kind of coordinated international effort impossible and the US is easily painted as the global villain.

Part of the problem here is that Republicans reject the science because they oppose the solutions. If they acknowledged reality, GOP officials would no doubt have a harder time explaining why they don’t want to deal with a climate crisis that has the potential to wreak havoc on the planet in dramatically dangerous ways.

The combination of deliberate Republican ignorance and the evolving Republican scheme to rule the United States Senate, makes the crisis even less approachable fear independent minded people – with little hope on the horizon. It also speaks to a larger truth — because there’s no commonly shared reality among Democratic and Republican policymakers, the prospects for compromise are effectively non-existent. And more then that – because of the need to compete politically, many Democrats will also tend to sit on their hands and avoid positive moves.

Sen. Susan Collins (R) of Maine this noted recently, “I don’t know who first described politics as the ‘art of compromise,’ but that maxim, to which I have always subscribed, seems woefully unfashionable today.”

But emissions isolationism is not going to fly – this as per the new ETS global aviation deal as approved by ICAo and to which American ailines will have to submit also – like everyone else.

Slim Kallas, the EU transport commissioner said that the new rules by ICAO (the 190 countries International Civil Aviation Organization) voted upon last Friday, and to go in effect in 2012, cover all carriers to fly in European skies. They will be forced to join industrial installations in Emission Trading Schemes and pay for excessive carbon dioxide emissions. The ICAO agreement rejected efforts by the US, and its Canada and Mexico allies, that were intended to make the EU regulation dependent on other countries from outside the EU that fly into the EU. Mr. Kallas agreed that the ICAO treaty was non-binding, but argued it still provides the needed “political legitimacy” to the ETS outside of Europe and will be strong helping material in case the American airlines will take their opposition to the European Court of Justice in Luxemburg.

This just a reminder of what we said that EMISSIONS ISOLATIONISM IS NOT GOING TO FLY and the US Republicans better not try to mislead the US electorate by suggesting otherwise.


Posted on on September 13th, 2010
by Pincas Jawetz (


Posted on on July 20th, 2010
by Pincas Jawetz (

EU looking to reset relations with Switzerland.



EUOBSERVER / BRUSSELS – With new institutions and powers granted by the Lisbon Treaty, the EU is looking to reset its relations with Switzerland, currently governed by 120-odd agreements covering everything from wrist watches to borderless travelling.

“We examined the state of our bilateral relations … and looked at how to renew them in the future, based on sound legal and political foundations,” EU council president Herman Van Rompuy said at a joint press conference with the Swiss president, Doris Leuthard.

Mr Van Rompuy said the reset had to be based on Bern accepting the “evolution” of EU law, in contrast to the current situation, when nothing is adopted automatically by the Swiss side.

“The EU position is that this is not the way to continue. With 120 bilateral agreements in place, imagine the whole bureaucracy when you need to change one paragraph,” one EU official familiar with the talks told this website.

Some 60 “working groups” on specific issues covered by these agreements – ranging from the wrist watch industry to transport, border control and fight against fraud – currently meet twice a year, separately and with little exchange amongst each other.

Ms Leuthard, switching from English into German and French, said that Switzerland too recognises the need to simplify the complex architecture of bilateral agreements. She stressed, however, that the new legal basis had to be “clean, but in respect of our sovereignty.”

One offer made to the Swiss is a “European Economic Area Lite”, alluding to the current agreement with Norway, also a non-EU member who is fully integrated into the bloc’s internal market and border-free Schengen area, but who unlike Bern automatically adopts any change to the EU laws.

Yet in a country where direct democracy is so deeply rooted that almost every decision is taken by referendum, the idea to adopt such legal “automatism” is unacceptable.

Swiss voters already rejected in 1992 the country’s accession to the EEA, precisely out of fear of losing sovereignty to Brussels, which is often criticised for its democratic deficit.

“Switzerland is against adopting EU laws automatically, using the argument that it is a sovereign country. But the EU says that as long as we are part of the internal market, we have to play by the book,” Jean Russotto, a Brussels-based Swiss lawyer specialised in EU law and regulatory compliance told Euobserver.

Another taboo subject for the Swiss public is the jurisdiction of the European Court of Justice, which has the ultimate say if a country infringes EU law. If Switzerland adopted the legislation automatically, it could, in theory be taken to the Luxembourg court by the European Commission in cases of non-compliance.

“This would be a problem,” says Mr Russotto. “The no-vote in 1992 was strongly influenced by the perspective of ‘foreign judges’ having a say in the country. The situation has not changed very much since, although we’ve adopted a lot of EU aquis (legislation), but it was done by our own parliament, not automatically.”

A compromise solution could be found, however, as it is the case for Norway, Liechtenstein and Iceland – which form the EEA. In their case, there is a special court based in Luxembourg and confusingly named the EFTA court after the European Free Trade Agreement which also includes Switzerland. The EFTA court, however, has no jurisdiction over the Alpine country. In an odd twist, the chief judge of the EFTA court, Carl Baudenbacher, is Swiss, but representing Liechtenstein.


On top of the existing differences over a potential over-arching agreement, a new actor on the EU side is likely to complicate negotiations: the European Parliament.

Following the entry into force of the Lisbon Treaty, the EU legislature has the power to strike down any international agreements negotiated by the EU commission.

It already put EU-US relations on freeze for while when it vetoed a deal on bank data transfers for anti-terrorism purposes, citing privacy concerns.

“We want to deepen our relationship with the European Parliament,” Ms Leuthard said. “It is very important to involve parliaments, because they decide ultimately on the agreements and their content,” she added.


Posted on on July 2nd, 2010
by Pincas Jawetz (

New pact to let European public track pollutants.

The 17 states that have ratified the Protocol on Pollutant Release and Transfer Registers are: Albania, Belgium, Croatia, Denmark, Estonia, Finland, France, Germany, Hungary, Latvia, Lithuania, Luxembourg, the Netherlands, Norway, Slovakia, Sweden and Switzerland. The European Commission is also a party.


GENEVA (Reuters) – Friday, July 2, 2010 – European citizens will be able to find out what dangerous substances are emitted in their neighborhoods under an environmental treaty to go into effect in 17 countries in October, the United Nations said on Friday.

Participating states will have to issue public inventories of major pollutants that their industries, traffic, agriculture and enterprises spew into the air, soil and water, including greenhouse gas emissions that contribute to climate change.

Some 86 categories of substances — ranging from mercury and other heavy metals, benzine, asbestos, pesticides including DDT, and dioxins — are covered under the pact.

“These inventories are made available to the public over the Internet and generally also through a downloadable map that helps people identify major pollutants that are traveling through their neighborhoods to discover what is in their backyard …,” Michael Stanley-Jones, an environmental expert at the U.N. Economic Commission for Europe (ECE), told reporters.

“It doesn’t cover all chemicals, but it does cover the major releases of chemicals,” he said.

The pact, signed in 2003 by 36 countries, enters into force on October 8 after being ratified recently by a 17th country (France), according to the Geneva-based agency. It is open to all U.N. member states for ratification.

“It is truly a global instrument, part of a global movement initiated in the 1980s after the major accidents in Bhopal and Chernobyl,” said Stanley-Jones.

A catastrophic industrial accident in central India killed nearly 8,000 people in 1984 when tons of toxic gas leaked from a pesticide plant of Union Carbide, a subsidiary of Dow Chemical Co, the largest U.S. chemical maker.

The Chernobyl disaster in Ukraine in 1986, the world’s worst civil nuclear accident, sent radiation over most of Europe.

The protocol to the 2001 Aarhus Convention enables citizens to voice concern over pollution to industry or regulators.

“As the major greenhouse gas pollutants are included in the protocol, this will give decision-makers and the public powerful new tools for identifying the major industrial sources of greenhouse gas emissions,” Stanley-Jones said.

“Major exceptions are for national security (facilities) and also the nuclear industry — radioactive substances are not covered by the protocol,” he said, noting that countries may add further substances and facilities to their national registers.

Countries outside of Europe, including Chile and Mexico, have developed their own registers and China’s industrial region of Shanghai is also drawing one up, according to the expert.

The 17 states that have ratified the Protocol on Pollutant Release and Transfer Registers are: Albania, Belgium, Croatia, Denmark, Estonia, Finland, France, Germany, Hungary, Latvia, Lithuania, Luxembourg, the Netherlands, Norway, Slovakia, Sweden and Switzerland. The European Commission is also a party.


Posted on on May 26th, 2010
by Pincas Jawetz (

Mercer is a leading global provider of consulting, outsourcing and investment services. Mercer works with clients to solve their most complex benefit and human capital issues, designing and helping manage health, retirement and other benefits. It is a leader in benefit outsourcing. Mercer’s investment services include investment consulting and investment management. Mercer’s 18,000 employees are based in more than 40 countries. The company is a wholly owned subsidiary of Marsh & McLennan Companies, Inc., which lists its stock (ticker symbol: MMC) on the New York, Chicago and London stock exchanges. For more information, visit

Mercer’s Quality of Living index list was revised and now covers 221 cities compared to 215 in 2009, which means direct trend comparison will not be possible until 2011. The new selection includes prominent capital and other major cities from across the world currently available in Mercer’s database, and better reflects where companies are sending their expatriate employees in the current business environment.

Slagin Parakatil, Senior Researcher at Mercer, commented: “As the world economy becomes more globalised, cities beyond the traditional financial centres are emerging as attractive places in which to expand or establish a business. Cities in many emerging markets, such as in the Middle East or Asia, have seen a significant influx of foreign companies and their expatriate employees in recent years.”

“To ensure their expatriates are compensated appropriately and an adequate hardship allowance is included in their benefits package, companies seek a clear picture of the quality of living in these cities. We have reviewed our index to reflect these developments and it now better represents the cities that most interest our clients,” Mr Parakatil said.



Eco-City Ranking 2010 includes the following criteria: Water availability, water potability, waste removal, sewage, air pollution and traffic congestion. As this list is only a partial list from Mercer’s more general lists of criteria, but they still retain New York City as the base figure with 100 as guide-line, obviously these figures are different then in their general listings.

In the more general list – Vienna retains the top spot as the city with the world’s best quality of living, according to the Mercer 2010 Quality of Living Survey. Zurich and Geneva follow in second and third position, respectively, while Vancouver and Auckland remain joint fourth in the rankings. Also there Cities are ranked against New York as the base city, with an index score of 100 – but that figure obviously means a different 100. In the US, the highest ranking entry is Honolulu at position 31, followed by San Francisco at position 32.  In the UK, London ranks at 39, while Birmingham  at 55 and Glasgow at 57. Singapore at 28 is the top-scoring Asian city, followed by Tokyo at 40.

Mercer conducts the general ranking to help governments and multi-national companies compensate employees fairly when placing them on international assignments. The rankings are based on a point-scoring index, which sees Vienna score 108.6 and Baghdad 14.7.

Top Top 52 Eco-Cities ranked:

Base City: New York, US (=100)

Rank 2010 City Country Eco-city index* 2010
9 KOBE JAPAN 135.6
32 LYON FRANCE 129.3
48 MUSCAT OMAN 124.2
50 OSAKA JAPAN 123.1

Mercer is a leading global provider of consulting, outsourcing and investment services. Mercer works with clients to solve their most complex benefit and human capital issues, designing and helping manage health, retirement and other benefits. It is a leader in benefit outsourcing. Mercer’s investment services include investment consulting and investment management. Mercer’s 18,000 employees are based in more than 40 countries. The company is a wholly owned subsidiary of Marsh & McLennan Companies, Inc., which lists its stock (ticker symbol: MMC) on the New York, Chicago and London stock exchanges. For more information, visit


Posted on on October 4th, 2008
by Pincas Jawetz (

 EUOBSERVER / WEEKLY AGENDA (5 – 12 October) – This week will start with a meeting of the EU’s economy and finance ministers (ECOFIN) in Luxembourg on the need for a European response to the international financial crisis, just a day after the bloc’s four biggest states – Germany, France, Britain and Italy – hold emergency talks on the subject in Paris.

The ECOFIN meeting on Tuesday (7 October) is expected to highlight the need for co-operation and cohesion among EU states on the issue, as well as the necessity of constructing a “structural response” to the crisis, rather than taking ad hoc actions.

The ministers will also underline the need to respect the so-called Stability and Growth Pact (SGP) – the rules underpinning the euro, following comments coming from some EU capitals that tackling the crisis should take priority over keeping budget deficits in line with EU rules.

“[The SGP rules] are temporarily not the priority of priorities. The priority is to save the global banking system and the savings of citizens. There is no other choice,” Henri Guaino, a close adviser of French President Nicolas Sarkozy told French television channel Canal Plus on Thursday.

The meeting – which will be preceded on Monday by a meeting of the economy and finance ministers from EU countries using the euro – will also assess the impact of the crisis on banks and insurance companies, as well as on small and medium-sized enterprises.


France believes EU-level measures may have to be cobbled together to aid banks in smaller member states, while denying rumours of a €300 billion package. But Germany has indicated it would not support any European “big-bang” deal.

“What happens if a smaller EU state is hit by a looming bank collapse? Maybe this country does not have the means to save the bank,” French finance minister Christine Lagarde told the Handelsblatt in an interview published on Thursday (2 October). “Therefore the question of a European safety net solution comes up.”

The safety package may be presented by French President Nicholas Sarkozy at a 4 October meeting between himself, the prime ministers of Germany, Italy and the UK, as well as Eurogroup chief Jean-Claude Juncker and European Central Bank president Jean-Claude Trichet.

Reports have it that the Netherlands is the source of the €300 billion proposal. The country quickly denied this was the case.

But any suggestion of a European version of US treasury secretary Henry Paulson’s $700 billion bail-out plan for Wall Street is being stiffly resisted by Berlin. In an interview with German daily Bild, Chancellor Angela Merkel said she opposed writing “blank cheques” for banks.

“The idea of applying one solution, one big bang … is not practicable and would create new, enormous problems,” German finance ministry spokesperson Torsten Albig told reporters yesterday in Berlin. “Germany does not think much of such a plan,” he said, according to AFP.

European Commission president Jose Manuel Barroso on Thursday welcomed the approval of the package by the American Senate, which had enabled another attempt to hammer out the bill in the House of Representatives and described it as “a good step forward in the right direction.”

But after receiving negative signals from both Berlin and London on the idea of a similar emergency fund worth €300 billion for Europe’s banking sector, French president Nicolas Sarkozy distanced himself from the proposal.

A day later Sarkozy said: “I deny the sum and the principle,” according to media reports. And from Christine Lagarde’s office:   “there was an exchange of ideas but no French proposals. There was no French plan,” AFP says.

Asked by journalists about a possible EU version of the US banking rescue scheme on Thursday, the European Central Bank (ECB) president Jean-Claude Trichet – also to attend the Paris mini-summit together with commission chief Barroso – openly said it would not work for Europe. “We do not have a federal budget, so the idea that we could do the same as what is done on the other side of the Atlantic doesn’t fit with the political structure of Europe.”

Britain has suggested that solutions to the financial crisis need to be primarily sought by national authorities. “It is right that individual countries would want to take their own decisions, particularly when national taxpayers’ money is potentially at risk,” said spokesman of Gordon Brown, UK’s prime minister: “The purpose of the [Paris] meeting will be to discuss how each of the four major economies in Europe are responding to the global financial crisis,” he added, according to the BBC.

The Irish parliament on Thursday passed a bill fully guaranteeing all bank deposits, which has sparked a controversy in other European capitals about unfair advantage for Irish banks over foreign competitors.

British media reported a rising interest among Brits to switch from the UK’s to Ireland’s banks in a bid to secure their savings in a rising atmosphere of insecurity. Minister Lagarde said in a BBC live interview that better European co-ordination could prevent such cases, arguing that “a measure decided in one [EU] member state has to be shared in advance with other member states.”

EU competition spokesman Jonathan Todd said his department still hadn’t received any formal explanation from Ireland about how its bank insurance programme would work, meaning it was still uncertain whether or not the EU will even clear the Irish move as legal.

The Guardian says that Greece has followed Ireland in offering a guarantee on deposits in all banks operating in the country, after it says savers were getting restless. The paper goes on to say that it puts EU leaders in a difficult position ahead of an emergency summit in Paris on Saturday to find a common response to the crisis.

Meanwhile, Deutsche Welle says that on Thursday the European commission gave the go-ahead to Germany for a €35bn deal to bail out mortgage lender Hypo Real Estate.

And El País says that the EU is struggling to come up with a common response to the financial crisis, with individual member states taking unilateral action to save their own banks: the UK (Bradford and Bingley and Northern Rock), France and Belgium (Dexia), and Belgium, the Netherlands and Luxembourg (Fortis).

France and Germany at odds over EU ‘Paulson Plan’ – 02.10.2008

France believes EU-level measures may have to be cobbled together to aid
banks in smaller member states, while denying rumours of a €300 billion
package. But Germany has indicated it would not support any European
“big-bang” deal.

EU big four gather for financial crisis talks – 03.10.2008

The leaders of the EU’s four biggest states – Germany, France, Britain and
Italy – are gathering for emergency talks on the financial crisis in Paris
on Saturday, one day after US lawmakers are expected to vote on an amended
bail-out plan. But France says there will be no US-type rescue package for
the EU.


Posted on on September 30th, 2008
by Pincas Jawetz (

From The European Parliament – September 30, 2008:   Europe props up crumbling banks.

European governments were forced to rescue a number of financial institutions hit by the US-born crisis, sending stock markets plummeting, reports Deutsche Welle.

Washington’s rejection of a 700 billion dollar bailout caused world markets to plummet, it says.

Only a few weeks ago, banks in the eurozone financial sector were said to be safe from the US-born financial crisis, but now, as the global financial situation gradually worsens, five European governments have had to step in to prop up financial institutions, the paper goes on.

France is to inject €1bn into ailing Franco-Belgian bank, Dexia, which will receive €6.4bn in total, with the rest made up from donations from Belgium and Luxembourg, according to Le Figaro.

In Ireland, meanwhile, the government has placed a two-year guarantee on all deposits and certain debts in six major Irish banks, says the Irish Times, in a move it says is to “safeguard the Irish financial system”.


Europe scrambles to save banking system: Banking stocks took a major hit across Europe after news the US bailout had failed.

LEIGH PHILLIPS, The EUobserver, September 30, 2008.

European authorities in Brussels, Frankfurt and at EU member state level are scrambling to save the continent’s financial system after bank stocks plunged when US lawmakers rejected a $700 billion bailout of Wall Street on Monday (29 September).

Banks are petrified of lending to one another for more than one day, requiring central banks to flood their coffers with the money they need to stay in business.

After yesterday’s part-nationalisation of Belgo-Dutch banking giant Fortis and the nationalisation of the UK’s Bradford & Bingley, Belgium-based Dexia, the biggest provider of lending to local governments in the world, could be the next financial institution to be rescued by taxpayers.

In an email from Belgian Prime Minister Yves Leterme, the country’s federal government reached an agreement with Belgium’s regional assemblies to jointly support the bank, Bloomberg News reported.

Even French President Nicolas Sarkozy has joined the rescue operation, despite the bank being headquartered in Belgium, issuing directions that the state investment body Caisse Des Depots offer Dexia funds.


Elsewhere, the German government backed by a series of private banks bailed out collapsing mortgage lender Hypo Real Estate reportedly to the tune of €35 billion, according to the German Ministry of Finance.

The list of nationalisations is rapidly growing, with Iceland – not an EU member state – also nationalising the country’s third largest bank, Glitner. The government has taken out a 75 percent stake in the firm in return for €600 million.

The Icelandic bailout is a larger per capita rescue operation than even the failed US $700 billion plan, representing some €2,000 for every Icelander. Following the move, the Icelandic Krona dropped to its lowest level ever against the euro.


Russia’s Prime Minister, Vladimir Putin, has rushed to the forefront in the crisis, announcing authorities will offer domestic banks a fresh $50 billion atop the $120 billion already supplied.


In perhaps the most frightening development, banks have deposited some €28 billion with the European Central Bank, afraid of leaving it stashed anywhere else, according to reports in the UK’s Daily Telegraph, quoting Hans Redeker, currency chief at France’s BNP Paribas.

“The ECB is no longer able to inject liquidity because the money is just coming back to them again,” the British paper quotes the banker as saying.


Bank stocks plunge:

Meanwhile, European bank stocks dropped through the floor on Monday, with Germany’s Aareal and Commerzbank particularly badly knocked down, taking a 42 percent and 22 percent hit to share prices. Ireland’s Anglo-Irish Bank was down 46 percent and Allied Irish down 16 percent.

Italy’s Unicredit, Sweden’s Swedbank and France’s Natixis all took a bruising as well, while a host of smaller banks in Denmark are set to collapse, according to the Financial Times. Spanish operations too are struggling.

On Monday, the European Banking Federation tried to reassure citizens that the financial sector was on a sound footing despite the crisis, and that depositors’ savings were not at risk.

“The global economy is facing an unprecedented crisis which is generating a certain degree of anguish due to the financial failure of some major banks,” the EBF said in a press statement.

“The European banking system will weather the storm,” the statement read, adding: “In EU countries retail deposits are insured.”


EU timetable:

French President Nicolas Sarkozy will meet bank and insurance company directors on Tuesday to assess the financial sector’s situation in his country, his office announced.

European Commission President Jose Manuel Barroso also said that a “structural European response” was currently being prepared for the summit of European leaders in two weeks’ time.

Additionally, on Wednesday, EU internal market commissioner Charlie McCreevy is to unveil a tripartite reform of European banks’ capital requirements.


Russia has a monetary surplus – will this now become its entree card to a tighter relationship with the EU?

Is this the beginning of a realignment that will see a Europe-Russia new economic bloc and a US-China economy tie-up?


Posted on on September 29th, 2008
by Pincas Jawetz (

Banking crisis claims Belgo-Dutch giant.
LEIGH PHILLIPS, The EUobserver, Monday, September 29, 2008.

The global banking crisis, born across the Atlantic, again sent waves crashing into Europe on Sunday (29 September) as the Belgian, Dutch and Luxemburg governments partly nationalised Belgo-Dutch banking and insurance giant Fortis in an €11.2 billion bailout.

The move was announced on Sunday evening by Belgian Prime Minister Yves Leterme, following a marathon weekend of talks between the three governments and European Central Bank chair Jean-Claude Trichet.

Belgo-Dutch bank Fortis is the latest recipient of tax-payer bailouts in the financial sector.

“We have taken up our responsibility, we did not abandon the savers,” Mr Trichet told reporters.

The deal will see the Benelux governments purchase 49 percent of the bank’s operations in each of the three countries. Belgium is to take on the biggest load, offering €4.7 billion towards the acquisition, with the Netherlands paying €4 billion and Luxembourg €2.5 billion.

The move comes after shares in Fortis plunged sharply in the last two weeks, losing more than a third of their value. Over the past year, shares in the bank – whose assets are many times larger than Belgium’s GDP – have lost some three quarters of their value.

The Belgian and Dutch governments have also said they will guarantee 100 percent the deposits of clients. Normally in the two countries, only an initial €20,000 is guaranteed by the state.

The governments had hoped to avoid any moves towards nationalisation of the bank and were attempting to piece together a purchase of Fortis – or at least part of it – by Dutch bank ING or BNP Paribas in France.

Negotiations broke off with the two banking groups when the Benelux governments refused to accede to demands that they offer guarantees against future losses.


Trouble at mill

Meanwhile in the UK, the government is set to nationalise troubled West Yorkshire-based bank Bradford & Bingley, according to British press reports.

The UK’s finance minister, Alistair Darling, has convinced Spanish bank Santander to purchase some 200 of Bradford & Bingley’s branches and €28 billion ( £22 billion) in savings, while the UK government is take over €52 billion ( £41 billion) of the bank’s mortgages, according to UK daily the Guardian.

The move significantly expands Santander’s presence in the UK, as it already owns Abbey and is in the process of purchasing Alliance & Leicester.


In Germany, troubles at lender Hypo Real Estate are also the subject of emergency talks between German banks and domestic authorities.

A possible rescue of the Munich-based bank is under consideration, while Reuters – quoting an unnamed source close to the discussions – is reporting that the group has received a credit line of some €35 billion from a consortium of private and public-sector banks in the country.


UK economists think mainly like US economists – call it an Anglo-Saxon bias. So, it takes outsiders to see through the maze – some of them also use the Financial Times for their sounding board. We have a collection of those other articles in a separate posting of Financial Times, September 29, 2008 printing. Here we present articles that still propose to take the US bailout for a possible example of how to deal with its overseas ramifications in Europe.




Posted on on March 20th, 2008
by Pincas Jawetz (

At the five years’ mark, we still think that deposing Saddam was right – staying in Iraq for oil was wrong. Investing that over half trillion dollars waisted (costs are already over $800 billion considering also the fight to depose Saddam) in creating an economy less dependent on oil would have been a much more reasoned choice. What now? posts the following Washington Post article as a memorial to what we were saying since the start of our website. Sure – the surge has started to work, but to what end? Will the US be able to hold Iraq together as one state common to all its communities? Is it really important to have it as one integrated oil exporting source, at a time that we will anyway start to decrease our economy’s dependence on oil? After removing Saddam we could have left the Iraqi’s to sort out their future by themselves. Had they come up with a Saddam-alike, the US could have gone in a third time – less cost and nothing lost. If the US still insists in keeping Iraq in one piece – will this not push the country even more into future collusion with Iran? The Shiia are the majority and the only part of Iraq that really seeks independence are the Kurds. Why hold them back from achieving their goal? Even Turkey starts to understand that a secure Kurdistan, cards played right, could be to their advantage, and the EU, without pressure from the US, would also shine some light in that direction. The Sunni monarchs of the League of Arab States are yet years away from understanding the emerging new neighborhood in which extreme religious interpretation is bound to highjack also their own states – this because they had that false hope that the oil-money can help them deflect the ire of their own people to targets abroad – the likes of Israel, and even their own benefactor – the United States. This sounds sick – but sick it is. It was that oil-money, that to different degrees, paved the way and paid for the radicalization of the world’s two billion Muslims.

And what did all of this do to the value of the dollar and to US economy at large?

Surely, The Washington Post does not make our points, but then it presents a reasonable description of how sad America feels on this day – after five years of war and just one year after the start of a real attempt to manage that war.

The EU Observer looks into the damages the continuation of the war did to EU-US relations and to the split it created within the EU. What is the value loss to the US from above? How long will take the healing process?…

Five Years In Iraq
Iraqis and Americans Offer Perspectives on the War
By Karen DeYoung
Washington Post Staff Writer
Wednesday, March 19, 2008; A01

The planning ministry in Baghdad explodes after being hit during the second day of U.S. raids on the Iraqi capital March 20, 2003. (Faleh Kheiber – Reuters)

For a majority of Americans, today marks the fifth anniversary of the start of an Iraq war that was not worth fighting, one that has cost thousands of lives and more than half a trillion dollars. For the Bush administration, however, it is the first anniversary of an Iraq strategy that it believes has finally started to succeed.

It has been about a year since Army Gen. David H. Petraeus arrived to command U.S. forces in Iraq, Ambassador Ryan C. Crocker took over as the chief U.S. diplomat, and the military deployed 30,000 more troops to protect and rebuild neighborhoods.

Officials now running the U.S. effort express frustration that the gains wrought by their new political, security and economic policies — in particular, sharply reduced violence — are continually weighed against the first four years of the war, when Iraq unraveled in insurgency and sectarian strife.

“I came to Washington to describe what we’re doing,” Charles P. Ries, Crocker’s senior deputy in charge of reconstruction and the Iraqi economy, said during a visit last week. “At almost every meeting, somebody wants me to describe what we used to do. . . . I know why people raise these questions, but I don’t feel it’s something I can speak to. The times were different then.”

Today’s policy is fundamentally different from the impatient mind-set of 2003, in both lowered U.S. expectations and a less imperious approach to dealing with Iraqi authorities. “In those days,” Ries said, “we decided what [the Iraqis] needed, and we built it.” Today, he said, Iraqis are asked what they want, and then told that while the United States will help, they will have to pay for most of it themselves.

Yet as the administration requests additional war funding and calls for a pause in promised troop withdrawals, some question its right to a second chance. “Like a tourniquet,” the troop increase “has stopped the bleeding,” Sen. Jack Reed (D-R.I.), a former Army Ranger and senior member of the Armed Services Committee, reported last week after his 11th trip to Iraq. What he has not seen, Reed said, are the surgery and recovery that would begin to heal the wound that Iraq has become. And even U.S. officials acknowledge that the “surge” has not led to the political reconciliation the administration had hoped for.

Others see the past year’s successes as fragile and reversible, and less consequential than the pain that preceded them. “I think they have it righter than they ever have before,” Daniel P. Serwer, an Iraq expert with the U.S. Institute of Peace, said of the administration. “But the fact is that those four other years did exist, and they condition a lot of what can and cannot happen now. There’s a history here, there’s a lot of blood and guts on the floor — literally.”

The White House tends to dismiss such longer memories. While it recognizes the inclination to “relitigate the past” when a milestone such as the fifth anniversary is reached, National Security Council spokesman Gordon Johndroe said, “our focus is on the way ahead and making sure that the current situation and the future situation gets better.”

In addition to new directions on the ground in Iraq, officials point to a newly effective structure designed to avoid the kind of ad hoc decision-making that led to early bureaucratic gridlock and mistakes, such as decrees dissolving the Iraqi army and banning Baath Party members from government jobs. President Bush‘s appointment last spring of Lt. Gen. Douglas E. Lute as deputy national security adviser for Iraq and Afghanistan has “helped streamline the process and made sure that there is . . . a senior-level official who can devote his full, undivided attention” to the subject, Johndroe said.

The once-bickering State Department and Pentagon are reporting new levels of cooperation. Diplomats who recall Donald H. Rumsfeld‘s insistence that the Defense Department control all aspects of early postwar policy note approvingly that it was his successor as defense secretary, Robert M. Gates, who recently called on Congress to increase the State Department’s budget.

Many U.S. officials participating in the new efforts talk about those years as though they belonged to another administration. “We weren’t here five years ago,” said one who, like several interviewed for this article, spoke on the condition of anonymity about past policy on the grounds that it would undermine the present.

“In the early days, they had an idea of something, a plan, of how it was going to be,” the official said. “They would remove Saddam, and democracy would flower. They took this plan and rammed it down into the reality of Iraq, which nobody understood. What did they know about Iraq? Who were they listening to?” In the past year, the official said, “there has been a coming to grips across the board with Iraqi reality.”

One of the more troublesome realities is that Iraqi leaders have been slow to take advantage of the “breathing space” that the troop increase was supposed to create. The administration has often noted that Washington and Baghdad operate on different clocks, with the U.S. timetable for demonstrable progress running far faster than its Iraqi counterpart. In an interview last week, Petraeus, the U.S. military commander, acknowledged that “no one” in the U.S. and Iraqi governments “feels that there has been sufficient progress by any means in the area of national reconciliation” or in the provision of basic public services.

In congressional testimony scheduled for early next month, both Petraeus and Crocker are expected to make the case that enough forward movement has been made to justify continuing the current strategy, and to warn that an abrupt withdrawal of U.S. troops could jeopardize the gains of the past year.

But while a strong congressional appearance by the two men last September quieted talk of funding cutoffs and brought a brief rise in public attention, their upcoming testimony appears to have sparked little anticipation.

As the administration struggles to focus on Iraq’s future, it is competing with a presidential race locked in debate about how the war began and how to end it, a Democratic Congress determined to fight over every additional dollar, and a weary, distracted public.

Indeed, once a top public concern, Iraq has been muscled aside by the economy and the political campaigns. In a survey released last week by the Pew Research Center, more people knew the names of the head of the Federal Reserve Board and the president of Venezuela than knew the approximate number of U.S. casualties in Iraq.

Some public views about the situation in Iraq have eased over the past year. But others, including baseline judgments about the war itself, have hardly budged. In the latest Washington PostABC News poll, nearly two-thirds said the war was not worth waging. Less than half, 43 percent, think the United States is making significant progress, and majorities continue to judge the war’s benefits as not worth its costs.

Polling director Jon Cohen contributed to this report.


And From the EUobserver – Iraq and the EU: Five Years On.

20.03.2008 – 09:21 CET | By Renata Goldirova from Brussels.
It has been five years since the United States began its military operation dubbed ‘Iraqi Freedom’. The war resulted in a deep rift in transatlantic relations, caused a split within the European Union and made Iraqis the single largest group seeking refuge in Europe.

On 20 March 2003, thousands of troops from four countries – the US (250,000), the United Kingdom (45,000), Australia (2,000) and Poland (194) – invaded Iraq. The invasion led to a quick defeat of the Iraqi regime, with its leader, Saddam Hussein, being captured in December 2003 and executed in December 2006.

The US and its allies cited allegations that Saddam Hussein’s regime possessed and was actively developing weapons of mass destruction as the reason for the invasion. However, no evidence of weapons of mass destruction have been found in the country’s territory.

“Five years into this battle, there is an understandable debate over whether the war was worth fighting … The answer is clear to me: removing Saddam Hussein from power was the right decision,” US president George W. Bush said on Wednesday (19 March).

Some estimates suggest that up to one million Iraqis have been killed since 2003, while the financial burden amounts to some $9 billion for London and $845 billion for Washington. Former head of the IMF Joseph Stiglitz has recently estimated the cost to be as high as $3 trillion.

But Mr Bush referred to the costs of the war as “exaggerated estimates”. “No one would argue that this war has not come at a high cost in lives and treasure – but those costs are necessary when we consider the cost of a strategic victory for our enemies in Iraq,” he said.

EU split:

The issue of military intervention against Saddam Hussein’s authoritarian regime became the biggest ever test for the EU’s common foreign and security policy, as member states were not able to speak with one voice.

Several countries, led by France and Germany, were opposed to US-led invasion, while others took part.

At the time, US defence secretary Donald Rumsfeld exacerbated the divisions by saying: “Germany has been a problem and France has been a problem.”

“You’re thinking of Europe as Germany and France. I don’t. I think that’s old Europe,” Mr Rumsfeld famously said.

Since 2003, a number of EU countries such as Italy, Lithuania, Hungary, Portugal, Spain, Slovakia and the Netherlands have withdrawn their soldiers from the violence-torn country, mainly due to public opinion.

At the same time, troops from Bulgaria, Denmark, Estonia, Latvia, Romania and the Czech Republic remain deployed in Iraq.

Pressure from Iraqi refugees:

According to fresh numbers released by the UN high commissioner for refugees earlier this week (18 March), asylum requests from Iraqis climbed to 38,286 in 2007, a sharp increase from the 19,375 claims in 2006.

A number of non-governmental organisations have therefore blamed the EU for not doing enough over a major refugee crisis, pointing to the fact that the treatment of Iraqis varies significantly from one member state to another.

For example, Sweden’s reception facilities have been under huge pressure, as the Scandinavian country is the only one within the 27-nation bloc granting refugee status or other protection to almost all Iraqi asylum seekers. A total of 9,065 Iraqis applied for refugee status there in 2006, compared to 2,330 the previous year.

The EU “cannot continue to ignore one of the world’s major displacement crises,” says a statement of a group of eight NGOs, including Amnesty International and the European Council on Refugees and Exiles.

In general, it is estimated that six million people inside Iraq need urgent humanitarian assistance as a result of the conflict. Some 2.5 million are internally displaced, while an additional two million are hosted by neighbouring countries such as Syria and Jordan.


Posted on on December 5th, 2007
by Pincas Jawetz (

“The EU is the only ‘geopolitical innovation’ based on the respect for cultural diversity in the world, and, as such, is an attractive model to share,” the Slovak commissioner Jan Figel said ahead of the official presentation of the “European Year of Intercultural Dialogue” on 4 December.

Business is ‘not enough’ to keep Europeans together.

04.12.2007 By Teresa Küchler for the EUobserver.
The EU’s commissioner for culture, Jan Figel, has embarked on a mission to promote dialogue between different cultures both inside and beyond the European Union.

In an interview with Euobserver, he explains why the EU is in a good position to talk about cultural values, despite past and present clashes between different cultures on its own soil.

With a budget of €10 million, a series of community programmes involving culture, education, youth, sport and citizenship will be initiated throughout 2008. The aim is to create closer links between European peoples themselves and between their respective cultures.

“Building the EU, they had to start with simple materials and realities: coal and steel, then the single market… But the European Union today is a more mature community, we all agree that market or business is not enough to keep people together,” the commissioner said.

“Europe should be a community of people, of values,” he continued, praising as an asset the somewhat contradictory notion of many cultures being a single entity and yet separate.

“We are living in one European home with a mosaic of pieces. The similarities are best seen from a distance, from other parts of the world,” he explained.     Speaking about his own experience, Mr Figel said that before the EU’s enlargement eastwards in 2004, lack of knowledge and trust between the old East and West prevailed in Europe.

“The old West did not look to the East as much as the East looked to the West. When my daughter went on a study trip to France some years ago, she was asked if we had running water in our homes, if she had ever seen a water tap,” he said.

He added that the debacle over the “Polish plumber”- Western countries fearing that Eastern Europeans would flood their countries to take their jobs and dump wages – seemed to be more based on “fear of the other”, than on actual economic considerations.

“Chopin is not a threat”, Mr Figel said jokingly, referring to the Polish 19th century composer.

“Enlargement was part of the solution, not the problem. Enlargement made the Union more European”, the commissioner continued, although admitting that there is still distrust between groups in the EU of today, shown in the discrimination against Roma in many parts of the bloc, or in the rise of extremist, xenophobic politics.

Religious dialogue:   The commission’s initiative to place the rather abstract notion of culture at the heart of European politics follows some tumultuous years of clashes between different ethnic and religious groups both in Europe and between Europe and the rest of the world.

“After enlargement, and in times of globalisation, in times of growing migration, so-called ‘multi-culti’ realities are very visible,” Mr Figel said, using a popular German expression for multi-ethnic communities.

“And in many cases we have seen difficult, problematic or even conflicting expressions of this,” he continued, referring to the uproar in the Islamic world in 2005 caused by a Danish newspaper’s decision to publish of drawings of the prophet Mohammed.

Several European officials have since called for a “completely new dialogue” between the EU and the Muslim world.

Others argue that dialogue is being too lenient towards those who do not respect the freedom of expression.

“Dialogue is not a sign of weakness, but of maturity”, Mr Figel said by way of reply.

Taking an example, he said that the aim of such a dialogue would not be to play “the good guys” while pointing the finger at Muslims.


Posted on on November 25th, 2007
by Pincas Jawetz (

EU-China relations will come under the spotlight on Wednesday, November 28th, when the two sides meetfor a summit.   The EU in Beijing intends serious discussions with China set to focus on   anti-dumping measures by the EU.

EU trade commissioner Peter Mandelson last week warned China the EU could put such measures in place if Beijing does not do something about its “unsustainable” trade surplus.

Brussels has been increasingly criticising China for its counterfeit goods market as well as for exporting fake goods. It also says China is not giving Europe enough market access.

At the end of the week, the EU is set to have a less prickly summit with India, the bloc’s tenth trading partner.

Topics on the agenda will include climate change.


Posted on on July 15th, 2007
by Pincas Jawetz (

From: Republic of Botswana (15/7/07): TAUTONA TIMES no 23 of 2007
The Weekly Electronic Press Circular of the Office of the President

July 16, 2007 – President’s Day in Botswana.

Today is the eve of President’s Day celebrations in Botswana. Like “Botswana Day”, which every year falls on the anniversary of our nation’s independence, President’s Day is an annual occasion for Batswana to reflect on the fruits of their political sovereignty. The creation of the State Presidency at the time of independence brought to an end a period of eighty-one year’s in which the British Crown had claimed and exercised sovereign rights over Botswana’s territory, much of which was thus demarcated as “Crownlands”.

During the colonial period, imperial sovereignty over Botswana was annually celebrated by the British administration as either “King’s” or “Queen’s” day, an Empire wide tradition that dated back to the time of Queen Victoria (“Mmamosadinyana”). Replacing Queen’s Day with President’s Day thus represented a break from foreign rule to self-rule.

Subsequently, it was also deemed appropriate to mark the 1st of July birth date of Botswana’s first President, Sir Seretse Khama with a separate holiday, while preserving the tradition of President’s Day.

It has also become an informal tradition for local political parties to hold meetings on the President’s Day long weekend. Thus, while H.E. the President has been attending the 32nd National Congress of the ruling Botswana Democratic Party (BDP), elsewhere around the country there have been similar gatherings of various other political movements that, like stars in a constellation, collectively enlighten this nation’s democratic unity in diversity.


From the President’s Statement:


14. Our government has championed citizen empowerment for the past 41 years, and we will continue enthusiastically to do so. A plethora of empowerment schemes exist and have existed as individual projects or as sectoral programmes in our development plans. Since they have not been isolated and highlighted in one document, some people, including members of the BDP have erroneously assumed that we do not have a policy on citizen empowerment.

15. The bottom line is that an enabling environment should exist, wherein all Batswana are empowered with requisite opportunities and skills to enable them to optimise their standard of living. Furthermore, it should be clarified, that most proponents of a stand alone citizen economic empowerment policy often refer to countries that have a preferential treatment policy for a specific segment of their society.

16. In most cases the segment that is being singled out for targeted empowerment tends to be a historically disadvantaged group, but in Botswana our empowerment efforts should and must focus on every single Motswana and not a specified segment of the population as we have all been previously disadvantaged.


17. The BDP Governments have over the years focused aggressively in resourcing the poor in our society. Not only has poverty dropped from 60% in our population in 1985/86 to 28% in 2002/03; a clear indication of our success in our poverty eradication efforts, but we have also very effective safety nets which ensure, that not one Motswana can perish because of hunger.

18. Our safety nets include schemes for the poor, the aged, remote area dwellers, orphans, the disabled and war veterans. As I speak, my government has allocated some P395m to drought relief projects for this year alone. This will provide part time employment for some 180, 000 Batswana the majority of whom would have depended on agriculture had the rains been good.


19. Education has been either heavily subsidized or totally free for all Batswana from primary to secondary education. All deserving Batswana continue to get substantial assistance for their education even at tertiary level. These subsidies on education are a targeted investment by the BDP government, intended to provide Batswana, with a springboard they could use to empower themselves.

20. The expansion of the University of Botswana; the planned Botswana International University of Science and Technology; and the Medical School and Training Hospital are recent examples of projects in education aimed at further empowering Batswana for employment and higher calibre job creation. Recently the Ministry of Education started to sponsor students at local private tertiary institutions for Diploma and Degree courses. Over 7000 are now so sponsored. This is empowerment.


21. Health care is virtually free in Botswana. Even expensive medications such as ARV’s are availed free of charge. The BDP government is cognisant of the relationship between an individual’s health and their overall ability to command an acceptable living standard.

22. For this reason, we have ensured, on a sustained basis, that our people have the best healthcare we are capable of providing as a nation. The evidence is overwhelming! Our commitment and determination to arrest the spread of HIV/AIDS is total and unshakable – hence the modest success we have registered in reducing the rate of infection.


40. Our ultimate objective is to achieve full employment for all our citizens as reflected in our Vision 2016 statement. As Democrats are aware, the rate of unemployment was around 10% in the early 1990’s. However, as a result of a combination of chronic droughts and the plateauing of minerals growth with a concomitant depression in the construction industry unemployment rose to 24% and it hovered around that level for many years, until recently, when we were able to reduce it to 17.6%.

41. The big projects which your government has initiated should force unemployment to go down further. I must express my concern though, about the rather lax attitude of some of our people. Many jobs in the agricultural sector remain unmanned for a long time because Batswana are not interested in working in that sector. This is regrettable. If we are to fight unemployment successfully we must become less choosy.


51. This is the penultimate congress before the next General Elections in 2009. This means by the time we get to the 2009 Congress it will be too late to fine tune or sharpen our thinking in various policy areas. This congress is, therefore, the most important opportunity to do so.

52. Our election preparedness starts right now with the preparations for “Bulela Ditswe” our primary elections. The Central Committee has appointed a Task Force, which in turn has sent teams around the country to clean up our membership registration hitches. This is very important, as it will determine that we have a clean, peaceful primary election, not adulterated by incomplete voters’ rolls and allegations of rigging.

53. Of course ultimately the business of any political party that wants to run the country is to win elections. It is for this reason that everything that we do must be aimed towards – the attainment of that objective – the 2009 elections. I shall never tire of reminding you, to channel all your energies towards making sure, that the BDP not only wins those elections but does so convincingly.

54. A scenario where we win the majority of seats but fail to command a comfortable majority in the popular vote is not a good one. Let us face it, it would undermine our mandate. Although in other countries it is not uncommon for a party to win elections sometimes with numbers as low as 30%, our opponents seem to think our 52% gives them some hope and even reason to celebrate.

55. I know we can legally and legitimately exercise a mandate even with less than half of the popular vote, but this we should never aim at. If all Batswana who were carrying our cards in 2004 had voted for their party, we would have won with more than 60% of the popular vote.


56. As for the opposition, we should remember, that they still present no alternative to ourselves, united or separately. This is why Batswana look to us as their only hope. Our policies, programmes and projects are well thought out. I still do not know what our opposition stands for. This situation is further compounded by the very public disunity that currently plagues the main opposition party, the BNF.

57. Anyone who thinks their recent special congress has healed their rift has got another surprise coming. To begin with, the one group did not even accept the results and we are receiving reports of a divided and disenchanted opposition membership around the country.

58. We should not, however, just sit here and celebrate their current state of disarray. We must work hard to exploit it to our benefit. We should graphically point out their current state of affairs.
Imagine the leader of a political party contemplating to run in an election under another party name and symbol as we hear is being contemplated in Ramotswa! And as happened in Lobatse when the leader of PUSO, in the person of Modubule successfully usurped the BNF seat and came to Parliament. You could go through them one after another and still be left wondering. The answer is of course that there is still no alternative.

59. This is why it is laughable for an organization like the BCP, which is not even running for state power, to lampoon Botswana’s democracy. Our democratic credentials are impeccable. They constitute the foundation of our political culture. And as such they do not belong to a single party but to all Batswana.

60. An entity that dissociates itself from this democratic culture runs the risk, of being driven into the political wilderness by our voters. I would not be surprised if the lonely member the BCP has in Parliament, who is there by dint of our generosity, went into extinction after 2009.

61. Madomi a Mantle, as I mentioned at the recent Women’s Wing Congress, the Constitution of our country, quite properly decrees that I retire by the 31st March 2008. I thank you most sincerely for the support that you have always given me during my tenure as Party leader. I have no doubt that you will extend similar support to my successor, His Honour the Vice President, Lt General Seretse Khama Ian Khama. I should enjoy my retirement immensely if you would do so.


62. In conclusion, let me wish you well in your Congress and encourage you to be level headed in your discussions if you are to come up with meaningful resolutions. May I also ask that we end our Congress in the spirit of love and mutual respect that must reflect our current theme: Unity and hard Work: Towards 2009 and beyond. Those elected and their supporters must, as they celebrate their success, do so with the utmost restraint and have consideration for the feelings of those who will have been less fortunate.

63. Much as I will spend as much time with you as I can, the immediate affairs of the country require that I, as is usual, leave you at some point to join the people of Goodhope on President’s Day. I join Batswana in different parts of the country every year for these celebrations at this time.

64. It is now my singular honour and privilege to declare this the 32nd National Congress of the Botswana Democratic Party officially open. TSHOLETSA! TSHOLETSA!


10/7/07 – from the World Bank Institute launches 2007 World Governance Indicators (WGI) Report:

With reference to the above, please find below [a] Statement by this Office, as well as [b] the full text of a media release received earlier this evening from the World Bank. The World Bank media release had been embargoed for forward transmission until 19hOO local time (CAT) (13h00 EST – Washington D.C.). Both statements’ can thus be understood as breaking news.

[a] “Botswana praised in latest World Governance Indicators Report

This Office is pleased to note that Botswana was once more been singled out for special praise by World Bank researchers in the context of today’s launch of the 2007 World Governance Indicators (WGI) Report, the full title of which is: “Governance Matters, 2007: Worldwide Governance Indicators 1996-2006”.

The launch was held at the World Bank Institute in Washington D.C.

In a statement released by the World Bank to coincide with the launch, Botswana has been singled out by researchers as being among a select group of developing countries that score higher on key dimensions of governance than a number of leading industrialized countries.

Botswana is the only African country to be so singled out in the statement. The other high achievers among those classified as “developing countries”, which are listed along with Botswana in the statement are Slovenia, Chile, Estonia, Uruguay, Czech Republic, Latvia, Lithuania, and Costa Rica.

The 2007 World Governance Indicators Report is said to represent a decade-long effort by a global network of researchers to build and update the most comprehensive cross-country set of governance indicators currently available to the public.

The latest indicators are further reported to cover a total of 212 countries and territories, drawing on 33 different data sources to capture the views of tens of thousands of survey respondents worldwide, as well as thousands of experts in the private, NGO, and public sectors.

This Office is also pleased to note that Botswana has performed well in all six of the Report’s identified components of good governance, which are:

1. Voice and Accountability – measuring the extent to which a country’s citizens are able to participate in selecting their government, as well as freedom of expression, freedom of association, and a free media.

2. Political Stability and Absence of Violence – measuring perceptions of the likelihood that the government will be destabilized or overthrown by unconstitutional or violent means, including terrorism

3. Government Effectiveness – measuring the quality of public services, the quality of the civil service and the degree of its independence from political pressures, the quality of policy formulation and implementation, and the credibility of the government’s commitment to such policies

4. Regulatory Quality – measuring the ability of the government to formulate and implement sound policies and regulations that permit and promote private sector development

5. Rule of Law – measuring the extent to which agents have confidence in and abide by the rules of society, and in particular the quality of contract enforcement, the police, and the courts, as well as the likelihood of crime and violence

6. Control of Corruption – measuring the extent to which public power is exercised for private gain, including both petty and grand forms of corruption, as well as “capture” of the state by elites and private interests.

The aggregate indicators as well as data from the underlying sources will be available at the website, which currently posts last’s year’s aggregate data.

According to the World Bank statement measuring various countries’ governance performance, and their improvements over time, is both a key item on the international governance agenda and a complex challenge, as governance has many dimensions, each with inherent measurement challenges. It goes on to state that the Worldwide Governance Indicators (WGI) project shows how this challenge can be met.

[b] [World Bank Institute] Press Release No: 2007/009/WBI… [The Release is now accessible online at –]

E2) 11/7/06: “Botswana a global leader in Political Stability”

The World Bank Institute report “Governance Matters, 2007: Worldwide Governance Indicators 1996-2006”, which was released yesterday, has ranked Botswana among the global leaders for Political Stability and the Absence of Violence.

With a score of 92.8% Botswana was ranked number 16 in the category out of the 212 countries and territories covered by the study, as well as number one in Africa. The score also placed Botswana above:

* all of the G8 nations, i.e. Canada (80.3), France (61.5), Germany (75.0), Italy (56.3), Japan (85.1), Russia (23.6), UK (61.1), and USA (57.7);

* all but 2 of the member states of the European Union, i.e. Finland (99.0), Luxemburg (99.5);

* all but 2 countries/territories in the Western Hemisphere, i.e. Aruba (95.7), St. Kitts & Nevis (94.2);

* all but 3 countries/territories in Asia, i.e. Bhutan (95.2), Brunei (93.3), and Singapore (94.7).

The 2007 World Governance Indicators Report is said to reflect a decade-long effort by a global network of researchers to build and update the most comprehensive cross-country set of governance indicators currently available to the public. Its composite indicators for 212 countries and territories have been drawn from 33 different data sources to capture the views of tens of thousands of survey respondents worldwide, as well as thousands of experts in the private, NGO, and public sectors.

Botswana scored exceptionally well for all six areas identified by the Report as being the key components of good governance. As labelled in the report itself, these are:

1) “Voice and Accountability” – measuring political, civil and human rights;

2) “Political Stability and Absence of Violence” – measuring the likelihood of violent threats to, or changes in, government, including terrorism;

3) “Government Effectiveness” – measuring the competence of the bureaucracy and the quality of public service delivery;

4) “Regulatory Quality” – measuring the incidence of market-unfriendly policies;

5) “Rule of Law” – measuring the quality of contract enforcement, the police, and the courts, including judiciary independence, and the incidence of crime; and

6) “Control of Corruption” – measuring the abuse of public power for private gain, including petty and grand corruption and state capture by elites.

With a composite score for all of the above categories of 74 Botswana occupies first position in Africa, followed by Mauritius (72) Cape Verde (66), South Africa (65), Namibia (62) and Seychelles (55).
13/7/07: 2007 Worldwide Governance Indicators (WGI) Africa Top Ten wrap up: “Botswana leads the way, as African countries make progress”

According to a now widely circulated news article, originally published in the New York Times, Africa has been portrayed “as a continent of great variety, with some countries making extraordinary progress over the past decade” in the latest World Bank Institute study “Governance Matters, 2007: Worldwide Governance Indicators 1996-2006”, which was released earlier this week in Washington D.C.

The article further cites the World Bank’s own descriptions of the study as providing strong evidence to contradict the notion of “Afro-pessimism”, while, moreover, establishing that wealthy, industrialized nations must also struggle with challenges of corruption and bad governance. In this respect the study is seen as a credible counter to negative media stereotypes of Africa as a whole as somehow being a continent that is uniquely mired in corruption, misrule and violence.

When combined, the World Bank Institute Report’s indicators place Botswana among the global leaders, as well as number one in Africa, for good governance. At the Report’s launch Botswana was thus singled out as being among an emerging group of developing countries that had scored higher on key dimensions of governance than many leading industrialized countries.

Described as the world’s most comprehensive database on governance issues, the Report incorporates composite indicators for a total of 212 countries and territories, which have been drawn from 33 different data sources. These are said to capture the views of tens of thousands of survey respondents worldwide, as well as thousands of experts in the private, NGO, and public sectors.

Botswana’s composite WGI score was 74, while Africa’s other top ten overall performers were, as ranked, were: Mauritius (72), Cape Verde (66), South Africa (65), Namibia (62), Ghana (55), Seychelles (55), Tunisia (53), Madagascar (48) and Lesotho (48).

In achieving its top score Botswana was also ranked well above the international norm, as well as in first, second or third position for Africa in each of the sub-category indexes for the six areas that were identified by the Report as being key components of good governance.

Botswana score and rank among Africa’s top ten for each of the six is reproduced below:

I. “Political Stability and Absence of Violence Index”, which is a composite of indicators measuring the likelihood of violent threats to, or changes in, government, including terrorism:

Botswana (93), Seychelles (84), Mauritius (79), Cape Verde (79), Namibia (75), Mozambique (64), Benin (59), Zambia (57), Libya (55), and Ghana (55). (In this index Botswana was also ranked 16 out of the 212 countries and territories surveyed.)

II. “Voice and Accountability Index”, which is a composite of indicators measuring political, civil and human rights:

Mauritius (75), Cape Verde (74), Botswana (67), South Africa (67), Benin (66), Namibia (61), Ghana (60), Mali (58), Lesotho (56), Seychelles (54).

III “Government Effectiveness Index”, which is a composite indicators measuring the competence of the bureaucracy and the quality of public service delivery:

South Africa (77), Botswana (74), Mauritius (72), Tunisia (71), Cape Verde (62), Namibia (59), Ghana (57), Morocco (56), Seychelles (53), Madagascar (50).

IV. “Regulatory Quality Index”, which is a composite of indicators measuring the incidence of market-unfriendly policies;

South Africa (70), Mauritius (67), Botswana (63), Tunisia (58), Namibia (57), Ghana (51), Morocco (48), Cape Verde (45), Madagascar (43), Senegal (42).

V. “Rule of Law Index”, which is a composite of indicators measuring the quality of contract enforcement, the police, and the courts, including judiciary independence, and the incidence of crime:

Mauritius (76), Botswana (67), Cape Verde (66), Tunisia (60), Namibia (57), South Africa (57), Seychelles (55), Morocco (53), Ghana (51), Lesotho (49).

VI. “Control of Corruption Index”, which is a composite of indicators measuring the abuse of public power for private gain, including petty and grand corruption and state capture by elites:

Botswana (78), Cape Verde (72), South Africa (71), Mauritius (66), Tunisia (62), Namibia (61), Seychelles (61), Lesotho (58), Morocco (57), Rwanda (56).


11/7/07: Report from VOA News – “Six African Countries Win High Marks in New Study of Religious Freedoms”

Six African countries – Botswana, Mali, Namibia, Senegal, South Africa, and Kenya – rank among the world’s most tolerant societies in terms of religious freedoms. That’s according to the latest study by the Hudson Institute’s Center for Religious Freedom. It measured the amount of government regulation, government favouritism toward a particular religion, and the amount of social pressures and constraints imposed by other faiths and organized groups in the country.

These factors, along with a high economic correlation had a close bearing on the study’s rankings of more than 100 countries worldwide. Eritrea and Sudan ranked among the most restrictive. Paul Marshall is the Hudson Institute Centre’s Senior Fellow and editor of its latest study, Religious Freedom in the World 2007. In Washington, he said that the 20 African countries studied revealed several success stories and also displayed some surprising anomalies.

“Sub-Saharan Africa scores lower than western Europe and the North Atlantic countries, all of which tend to score pretty highly with ones, twos, or threes. It scores better than North Africa and West Asia (sometimes called the greater Middle East),” he says……”The study shows that religious freedom correlates very well with firstly economic freedom, and the development of markets. Secondly, it correlates with economic well-being, that income levels measure equality. It actually correlates even better than income with indexing, as measured in this context, by numbers of cell phones in use. And we have grounds to believe that we can actually show, in general, religious freedom helps development. This is true in Sub-Saharan Africa especially,” he says.


Posted on on June 30th, 2007
by Pincas Jawetz (

Alliance of Liberals and Democrats for Europe (ALDE) – a faction of the European Parliament.

ALDE Campaign on Climate Change


While the impact of climate change throughout the world is somewhat difficult to define precisely, the existence of a change in our weather patterns has become increasingly noticeable to many. More and more scientific studies are pointing to pollution and carbon emissions in particular as the most probable cause of the global change in climate. Concrete measures must be taken to reverse the pattern of climate change in order to protect both current and future generations.

ALDE MEPs (Members of the European Parliament) are attempting to do just that by:
ensuring that CO2 emissions are curbed,
using available resources in a more sustainable way,
and, above all, by keeping the door open to those technological changes that are in the pipeline that will enable us to use energy much more efficiently than we currently do.
Reversing the current trend in climate change will not happen unless we involve individuals, the industrial sector and our elected legislators.

As an individual:

How responsibly do you deal with energy consumption? How many appliances do you leave on permanent stand-by ? Do you recycle? Do you only buy super efficient appliances?

Is industry devoting enough resources to R & D for new energy efficient products? How aware is industry of the overall environmental impact of their products?

As for ALDE legislators, our task is to guarantee the best possible legislative framework so that each sector of society (individuals, conurbations, industry) can play its part in moving towards a more sustainable type of existence.

In terms of progressive environmental legislation, the EU is already an acknowledged world leader. Let’s continue the good work on the climate change front so that third countries and other regional blocs can look to us for inspiration.

Each and every one of us can do something about their personal carbon footprint. Start NOW!


What will you be doing on 1 July at midday?


Worried about unsustainable use of the Earth’s resources?

Just turn off the power for 1 hour and help raise awareness of our collective responsibility to tackle climate change in our everyday lives! ALDE group supports this initiative.


Posted on on June 5th, 2007
by Pincas Jawetz (

UNDP and Fortis (
listed on Benelux exchanges) team up to leverage carbon finance for sustainable development – the MDG Carbon Facility intended to deliver 15 million Kyoto Protocol Mechanisms Carbon Credits.

Berlin, 5 June 2007—The United Nations Development Programme (UNDP) and banking and insurance giant Fortis announced an agreement today naming Fortis the financial services provider for UNDP’s MDG Carbon Facility. This announcement also marks the operational launch of the Facility, an innovative means of harnessing the vast resources of the carbon market to bring long-term sustainable development to a more diverse share of developing countries.

Under the terms of the partnership, announced in Berlin just prior to the G8 summit, UNDP will help developing countries conceive projects intended to reduce emissions of greenhouse gases, and will ensure that these projects meet the Kyoto Protocol’s agreed standards and deliver real, sustainable benefits to the environment and broader human development. Fortis will then purchase, and sell-on, the emissions-reduction credits generated by these projects. The proceeds from Fortis’ purchases will provide developing countries and communities with a new flow of resources to finance much needed investment and to promote development.

‘MDG’ is short for ‘Millennium Development Goals,’ the specific targets, agreed by United Nations member states, for diminishing global poverty and achieving major advances in health, education, environment and equality by 2015.

“As we reach the halfway point to the 2015 target for achieving the Millennium Development Goals, it is clear that business has a critical role to play in advancing sustainable human development,” said UNDP Administrator Kemal DerviÅŸ. “We are delighted to have an eminent partner like Fortis join us in working to use carbon finance to transform markets, help mitigate the effects of climate change and promote a more sustainable future for all.”

“The MDG Carbon Facility is a very exciting win-win opportunity for us,” said Fortis Chief Executive Jean-Paul Votron. “It gives us the chance to make a major contribution to spreading the benefits of sustainable development while at the same time securing a strong position in the carbon market.”

A recent Poverty-Environment Partnership report estimates that US $60-90 billion per year will be needed to address the environmental issues that contribute to poverty in developing nations; the market in emission reduction credits carries enormous potential for bringing essential new investment to tackle these issues. The MDG Carbon Facility will operate within the framework of the Clean Development Mechanism and Joint Implementation, the market-based mechanisms under the Kyoto Protocol that allow developed countries to meet their compliance targets by financing projects in developing countries that contribute to reducing greenhouse-gas emissions.

The Clean Development Mechanism, or CDM, has been at the center of a rapidly expanding, billion-dollar international market for carbon credits. However, early signs indicate that the CDM is unlikely to deliver the broad-based benefits that many hoped it would, at least in the near to medium term. CDM projects have so far been limited in geographic reach, restricted mainly to Asia and Latin America, and have focused primarily on ‘end of pipe’ technologies that generate limited benefit for long-term sustainable development.

The MDG Carbon Facility aims to address these limitations by capitalizing on Fortis’ resources and substantial carbon experience, together with UNDP’s specialized expertise and global reach. By expanding the CDM’s presence into countries and regions previously considered inaccessible to carbon finance, MDG Carbon will help people in these areas acquire the resources and knowledge to take greater control over their future environment and development paths. Once a developing country gains proficiency in carbon finance, attracting private-sector investment and developing project technologies that deliver longer-term development benefits, the MDG Carbon Facility will exit that market, having accomplished its market transformation objectives and no longer needing to play its role as a bridge between developing countries and the global carbon market.

“Harnessing the power of the marketplace is essential in the fight against harmful global climate change: The MDG Carbon Facility is a creative market-based strategy that promises to produce double dividends–carbon reductions and economic progress in the world’s less-developed countries,” said former Sen. Timothy Wirth, President of the United Nations Foundation, which provided a large portion of the startup funding for the Facility.

The partnership between UNDP and Fortis covers an initial pipeline of projects which will generate 15 million credits during the Kyoto Protocol’s first commitment period (2008-2012). UNDP and Fortis will begin evaluating potential projects for the Facility immediately.

About UNDP: UNDP is the UN’s global development network, helping people meet their needs and build a better life. We are on the ground in 166 countries, working as a trusted partner with governments, civil society and the private sector to help them find solutions to global and national development challenges. With a US$5 billion portfolio of energy and environment projects, UNDP is already one of the world’s largest providers of technical assistance in the area of climate change. For more information, visit

About Fortis: Fortis is an international financial services provider and ranks among the top 25 financial institutions worldwide by assets. Fortis has a market capitalization of EUR 43.2 billion (30/04/07) and is listed is listed on the stock exchanges of Amsterdam, Brussels and Luxembourg and has a sponsored American Depositary Receipt (“ADR”) program in the United States. Its solvency position (S&P: AA-), presence in 50 countries and professional workforce of 58,000 enable Fortis to combine global strength with local flexibility.

Fortis is a market leader in carbon banking services, with a large and experienced team, and a horizontally integrated offering of carbon trading, trust and financing services. Fortis is committed to becoming carbon neutral across its operations. For more information, visit

For more info, contact: Ben Craft (UNDP), +1 917 213-7520, +1 212 906-5344 or + 1 212 906 5382,  benjamin.craft at; Chandrika Deshpande (UNDP-London), + 44 07957 460 246,  chandrika.deshpande at; Niamh Collier-Smith (UNDP-New York) + 1 212-906-6111,  niamh.collier at ; Wilfried Remans (Fortis), +32 2 565 46 79 or


Actually, the UNDP is today even more “pushy” then the above. It really is more active then the UN Secretary-General whose restricted presentation in Panama City we posted earlier.

UNDP has also released today a World Environment Day message to stress critical links
between climate change and biodiversity. That was more then what we saw in the UNSG presentation in Panama City.
Though, to be accurate, the content of this UNDP press release is nothing new, as we dealt already earlier with the Equator Prize winners who reflected   in their work the importance of combining conservation with sustainable livelihoods. The new thing is that this was released now also in Berlin, and also as part of the pre-G8 campaign, with an impressive list of co-sponsors that includes the   the Convention on Biodiversity (CBD), The World Conservation Union (IUCN), the Equator Initiative, GEO Magazine, and the biodiversity alliance Countdown 2010.

Berlin, 5 June— On the occasion of World Environment Day, and in the run-up to the G8 Heads of State summit, senior officials of the United Nations Development Programme (UNDP), the Convention on Biodiversity (CBD), The World Conservation Union (IUCN), the Equator Initiative, GEO Magazine, and the biodiversity alliance Countdown 2010 encouraged Group of Eight leaders to take bold steps to protect the diversity of life on earth and support adaptation to and mitigation of climate change.

Dr. Ahmed Djoghlaf, Executive Secretary of the Convention on Biological Diversity (CBD), emphasized that “Climate change and biodiversity loss, two strongly linked issues, are poised to interfere with, and even reverse, progress that is being made towards the Millennium Development Goals; disrupt economies and international trade; and fuel international conflict over access to land and resources.”

“A stable climate is essential to maintaining biologically diverse ecosystems and in securing peoples’ livelihoods, including the maintenance of food security and access to clean water,” Olav Kjørven, Assistant Administrator and Director for UNDP’s Bureau for Development Policy, underscored.   “In addition to regulating climate, biodiversity provides the world’s population – most directly, the poor in developing countries – with food, medicine, building material, and bioenergy. It is particularly noteworthy that developing countries are most directly affected by the consequences of climate change, while developed countries have contributed most to it.”

The World Environment Day message was presented as part of a series of events at Berlin’s Museum für Naturkunde centering on climate change and biodiversity and its role in realizing sustainable development. The events included panel discussions, a photo exhibition highlighting biodiversity and an awards ceremony honoring the winners of the prestigious Equator Prize (see below), which salutes grassroots leaders in utilizing biodiversity to sustain livelihoods.

Panel spokespersons, including Astrid Klug, Germany’s Parliamentary State Secretary for the Environment; Peter Seligmann, President and CEO of Conservation International; and Jeffrey A. McNeely, Chief Scientist, IUCN; stressed the need for more concerted action to link both climate change and biodiversity policy discussions and implementation mechanisms.

The day’s events were supported by the German Federal Ministry for Economic Cooperation and Development (BMZ); Deutsche Gesellschaft für Technische Zusammenarbeit (GTZ); Secretariat of the Convention on Biological Diversity (CBD), Countdown 2010, the Equator Initiative, GEO Magazine, IUCN – The World Conservation Union and UNDP.

Dr. Michael Hofmann of BMZ, in committing to deliver the World Environment Day Message to G8 leaders, stressed: “Biodiversity needs to be placed on the highest level of the political agenda. It must form an integral dimension of global economic policy.”

The Equator Initiative is a partnership that brings together civil society, business, governments, and communities, with the support of the United Nations, to help bolster the skills and knowledge and share the stories of grassroots efforts to reduce poverty through the conservation and sustainable use of biodiversity. Building on the formal message for World Environment Day, the Equator Initiative offered the following specific recommendations for action:

“In addition to reaching the 0.7 per cent ODA target, the G8 must provide the global leadership to finance climate change adaptation and mitigation, and implement innovative financing mechanisms to direct funds from carbon markets towards sustainable development in the world’s poorest countries.
We urge the G8 negotiators to adopt a clear mandate to use the UNFCCC COP in Bali of this year to agree on a formal negotiating mandate for a successor agreement to the Kyoto Protocol by 2009, thus demonstrating leadership to the rest of the world community.
We call on the G8 to lead the world in integrating biodiversity and climate change concerns into all relevant sectors such as trade, development, agriculture, finance and transport.
The G8 should take the lead in establishing the terms for the production and trade of ethical, environmentally, socially, economically sustainable biofuels and consider establishing formal mechanisms to provide concrete guidelines and recommendations.

We ask the G8 to support an economically viable socially equitable incentive scheme for reduced emissions from deforestation and degradation in order to ensure that the world’s poorest countries have reason to safeguard their vast forest wealth in manner that benefits not only the planet but also safeguards the rights and livelihoods of local forest-dependant communities.
The G8 must give weight to the value of traditional knowledge in preventing biodiversity loss and adapting to climate change by investing at the community-level to help poor countries respond to development challenges and achieve the MDGs.”

World Environment Day participants encouraged leadership of the G8 to take concrete steps to address climate change hand-in-hand with biodiversity conservation. “The Heiligendamm Summit offers a unique opportunity for the leaders of the G8 to come together to ensure the urgent action required commensurate with the unprecedented challenges facing humanity,” said Benson Venegas of ANAI, Talamanca Initiative, Costa Rica.

Equator Prize winners

Later in the day of biodiversity events, five communities from throughout the tropics were honored with the Equator Prize, an international recognition of extraordinary work to diminish poverty through the conservation and sustainable use of biodiversity.   The Prize, awarded biennially since 2002, serves to further advance the understanding within the global community of the vital link between healthy, biologically diverse environments and the creation of sustainable livelihoods.

The five winners, representatives of which will attend a dinner in their honor tonight, were selected from a group of 25 finalists, chosen from more than 300 nominations from 70 countries.   The five initiatives honoured are:

Ø           The Village of Andavadoaka on the island of Madagascar, which demonstrates how communities can organize to manage a valuable resource, in this case the octopus fishery, so that it can provide sustainable benefits over the long term.
Ø           Shidulai Swarnivar Sangstha uses riverboat-based educational-resource centres throughout Bangladesh’s Ganges River delta to deliver information on sustainable agricultural practices and market prices.
Ø           In Guatemala, the women of Alimentos Nutri-Naturales have reinstated the Maya nut as a staple source of nutrition, thereby conserving the Maya nut forests in the buffer zone to the Maya Biosphere Reserve.
Ø           Shompole Community Trust in Kenya conserves the vast and scenic grasslands and savannah to fuel a robust, profit-driven ecotourism venture benefiting the Maasai people.
Ø           In Ecuador, in the Galapagos UNESCO World Heritage Site, the women of Isabela Island’s “Blue Fish” Association are marketing a local delicacy, tuna smoked with guava wood, as a way of promoting alternative use of marine resources and controlling the invasive plant species.

In addition to international recognition for their work and an opportunity to help shape international policy and practice in the field, each winner will receive US $30,000. The Equator Prize focuses on community-based initiatives between 23.5 degrees of latitude north and south of the equator; one Equator Prize is awarded in each geographical region of eligibility (Latin America and the Caribbean; Africa; and Asia and the Pacific), one to a community-based project associated with a UNESCO World Heritage Site, and one to a project that best exemplifies sustainable biodiversity-based business.

For the full text of the message and the recommendations for action, please visit:

For more information, please contact Ben Craft, UNDP; + 1 917 213-7520 or  Benjamin.craft at; Elspeth Halverson, +44 7790 641499 or  elspeth.halverson at or visit