THEN ESCAP URGES the SPECA CENTRAL ASIA TO STRENGTHEN TIES WITH REST OF CONTINENT FOR GREATER SECURITY. The above has clearly political implications by bundling non-Arab Islamic States.

Greater cooperation between Central Asia and the rest of Asia is essential to achieve sustainable development for the whole continent, given the current climate of global financial instability and food and energy insecurity, a senior United Nations official, ESCAP’s Executive Director  stressed today of all places - right in Moscow.

The UN Economic and Social Commission for Asia and the Pacific (ESCAP) stands ready to facilitate technical and regional cooperation and provide a neutral forum for engaging in policy dialogue, Executive-Secretary of ESCAP Noeleen Heyzer told a gathering of senior Central Asian policymakers in Moscow.

“We are gathering here against the backdrop of a gloomy economic environment with pressing challenges in food and energy security, as well as the need for greater financial stability,” Under-Secretary-General Heyzer warned participants at the UN Special Programme for the Economies of Central Asia (SPECA) meeting.

“By adopting the South-South cooperation modality, SPECA can provide home-grown solutions and policy options to achieve inclusive and sustainable development,” she told officials from the seven SPECA member states – Azerbaijan, Afghanistan, Kazakhstan, Kyrgyzstan, Tajikistan, Turkmenistan and Uzbekistan.

SPECA aims to strengthen sub-regional cooperation, mainly in the areas of energy and water, transport, trade, technology, gender and the economy, in Central Asia, as well as its integration into the world economy with support from the UN Economic Commission for Europe (ECE).

A NAGORNO-KARABAKH FOREIGN MINISTRY IN DISCUSSIONS WITH THE EU?

The Nabucco pipeline - the EU hopes construction will begin in 2010
(Photo: Nagorno-Karabakh foreign ministry)

Turkmenistan to cut EU dependence on Russian gas.

April 14, 2008 - By Renata Goldirova, for the EUobserver.

Turkmenistan has agreed to supply 10 billion cubic metres of natural gas to the European Union each year - something that should cut the energy-hungry bloc’s dependence on gas from Russia.

“The president [Kurbanguly Berdymukhamedov] gave us assurances that 10 bcm will be set aside for Europe in addition to possibilities in new fields to be tendered,” EU external relations commissioner Benita Ferrero-Waldner told the Financial Times on Sunday (13 April).

Ms Ferrero-Waldner described the deal as “a very important first step” in energy cooperation, although she acknowledged the amount agreed by the two sides does not represent a “vast quantity”.

The former Soviet Republic in Central Asia has the world’s fifth largest reserves of natural gas and substantial deposits of oil. It annually produces 60 billion cubic metres of natural gas, but two-thirds are exported to Russia’s state-run Gazprom.

Demand for energy is sharply rising in the European Union. By 2020, it is expected to import at least 360 bcm - out of 500 bcm consumed - from third countries.

The 27-nation bloc has been trying to diversify its energy supplies away from Russia and is currently pushing for a new energy corridor, the Nabucco pipeline.

The pipeline - connecting Turkey with Austria, via Bulgaria, Romania, and Hungary - would enable the transportation of Caspian energy resources to the European market. Main gas supplies could come from countries such as Azerbaijan, Kazakhstan, Turkmenistan or Egypt.

Speaking about the fresh deal with Turkmenistan, Ms Ferrero-Waldner called on European business to invest in infrastructure in order to bring the project to life.

It is still unclear how Turkmen gas will be imported to Europe, with the commissioner suggesting three possible short-term scenarios in the interview with the Financial Times.

Under the first one, a 60-kilometre gap between Azeri and Turkmen offshore installations could be closed with a mini-pipeline.

Secondly, an onshore link to Kazakhstan could be built to connect with a route to Azerbaijan.

Under the third option, the gas could be compressed into liquid form and taken by tanker across the sea.

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Russia questions value of Nabucco energy pipeline.

April 18, 2008 - By Renata Goldirova from Brussels for EUobserver:

Moscow has questioned the viability of the EU-backed Nabucco energy corridor, a pipeline designed to lessen the bloc’s dependency on Russia.

“I know few things about political geography. The only way to fill the Nabucco pipeline is to rely on Iranian gas,” Russian ambassador to the EU Vladimir Chizhov told journalists earlier this week (15 April). He added: “But then, it’s up to the West, I would not tell the EU, to make up its mind how to deal with Iran. Either bomb Iran or buy its gas.”

Mr Chizhov’s blunt comments came only hours after Turkmenistan had agreed to supply 10 billion cubic metres of natural gas to the EU each year - something that should cut the energy-hungry bloc’s dependence on gas from Russia.

“There have been some euphoric comments about Turkmenistan,” the ambassador said, stressing that the volume agreed by the two sides is “not enough”. In addition, he questioned the ability of Azerbaijan, another potential source, to fulfil the union’s sharply rising energy demand.

The European Commission considers Nabucco to be “essential” to the EU as it is designed to bring gas from non-traditional suppliers via a new transport route.

The pipeline - connecting Turkey with Austria, via Bulgaria, Romania, and Hungary - would enable the transportation of gas from the resource-rich Caspian region to the European market.

Its capacity amounts to 31 billion cubic metres of natural gas per year. The bulk of the supplies are expected to come from countries such as Azerbaijan, Kazakhstan, Turkmenistan or Egypt.

The EU is also hoping to secure natural gas from Iraq, with Baghdad earlier this week pledging to provide five billion cubic metres of gas each year. The two sides are set to sign a so-called energy security memorandum of understanding in coming days.

In response to Mr Chizhov’s statements, the commission said that a list of source countries was yet to be defined. It addmitted, however, that once the problems with Iran are solved, Tehran can be taken into consideration on the longer term.

Meanwhile, Moscow - the world’s largest producer of natural gas - has been pushing for its own project, the South Stream pipeline. It should connect Russia’s Black Sea coast and Italy, with Bulgaria, Greece, Hungary and Serbia already saying they will take part in the project.

According to the Russian ambassador to Brussels, there will be enough room for the South Stream, Nabucco and perhaps for another pipeline due to growing energy consumption in Europe - but only in the long run.

In the short run, the defining difference is that the South Stream can rely on real gas supply, whereas Nabucco does not have gas, Mr Chizov said.

The South Stream project is seen by some as a rival to Nabucco, with the European Commission saying “it is not promoting it actively” because the pipeline will bring more gas from Russia.

“The two projects are complementary, not contradictory,” reads the commission’s official line on the issue. The EU needs 80 billion cubic metres of natural gas per year on top of current consumption.

But some experts on EU-Russia energy relations have also suggested that Moscow has made a valid point.

According to Marco Giuli from the Brussels-based Centre for European Policy Studies, the Nabucco pipeline is “economically viable only with Iranian gas”.

He cited political tensions in Central Asia, the proximity of Chinese market as well as the US’ tough stance on Iran among those factors that cloud Nabucco’s prospects.

Within the 27-nation EU, France and the UK seem to have the toughest position towards the Iranian regime, wanting to stop its nuclear ambitions not only through dialogue, but also via sanctions.

On the other hand, Italy’s oil and gas producer ENI is set to undertake some investments in Iran - something, Mr Guili says has been endorsed by the country’s outgoing as well as incoming political leadership.

Renata Goldirova reports for EUobserver from Brussels - “Germany highly critical of EU energy package:”
As a start – The European Commission president has thrown his weight behind a sweeping reform of the EU energy market, which ultimately should see the break-up of the bloc’s energy giants.

“The commission is clear that the status quo cannot continue…Without change, distortion of competition and fragmentation of the market will continue”, Jose Manuel Barroso said on Wednesday (19 September), after the commission gave the green light to the package.

Mr Barroso has also urged the EU capitals as well as European lawmakers “to move quickly to agree these proposals”, arguing “EU citizens have every right to expect that we act to energize Europe”.

Brussels has clearly spelled out its preference for full ownership unbundling, requiring a company to split its production and transmission wings.  “This is by far the most effective approach”, the commission chief said, adding an increasing number of member states are already going down this route.

This could be achieved in two ways – companies may either sell their transmission networks to an independent investor or form new separate business through a shares split.

Although Mr Barroso anticipated that the negotiations on package will be “tough, long and difficult”, Germany’s reaction was unusually critical of the proposals. German economy minister Michael Glos said “the high quality and security of German electrical power networks should not be put in danger -The package is all in all too bureaucratic and leads to a high regulatory burden,” he said.

Germany “strictly rejects” ownership unbundling, said Mr Glos adding that he is “very sceptical whether through the focus of the commission on ownership unbundling, a way for more competition is found.”

“The contrary is more likely,” he stated. Germany, along with France, had been the strongest opponents of the unbundling option in the run up to the publication of the proposals.

A ‘Gazprom clause: ‘ The commission also received criticism from elsewhere – albeit more veiled – for another part of the proposal on protecting the EU energy market.

Reacting to Brussels’ energy package, Russian state-owned energy giant Gazprom indicated it would present its evaluation of the way these measures will affect security of supply, the competitiveness of European energy markets as well as energy prices in Europe.

“Gazprom has an important contribution to make to the debate about regulation of the energy sector in Europe and feels certain that its voice will be heard”, the company’s Sergei Kupriyanov said in a written statement.

He has also rushed to remind Europe that “Gazprom is a reliable gas supplier to the European Union and a major investor in the infrastructure which brings gas to Europe”.

Under the proposed restrictive rules, foreign buyers who wish to purchase an EU network will have to follow the same unbundling requirements as the union’s own firms.

In practice, third countries as well as their individuals should not be able to acquire control over an EU transmission network unless there is agreement between the EU bloc and the companies’ country of origin.

However, Mr Barroso has refused to label the safeguards as protectionism – or the Gazprom clause as it has quickly become known.

“This is about fairness; it is about protecting fair competition. It is not about protectionism”, he said.

A quarter of the bloc’s gas as well as quarter of its oil originates from Russia.

Despite the expected difficulty of the negotiations, the European Commission believes an agreement could be thrashed out under France’s six-month EU presidency, starting in July 2008 – with Mr Barroso firmly putting the ball in member states’ court.

“Today we put everyone before their responsibilities. If the results are lacking it will not be because of a lack of ambition on the part of the commission”, he concluded.

Russia and China resist EU play for Central Asia.

By Andrew Rettman EUOBSERVER / BRUSSELS , May 8, 2007.

Russia and China are trying to counter EU efforts to secure fresh energy supplies in Central Asia, the EU’s top regional envoy, Pierre Morel, has warned, with analysts worried Turkey could also start competing with European interests if its EU accession hopes fade.

“There’s a level of competition - you’ve got Russia, China and the US. There’s Turkey as well, and India is developing a strategy,” Mr Morel told MEPs at a European Parliament debate in Brussels on Tuesday (8 May), as Europe gears up to launch its first ever Central Asia policy at the June EU summit.

Focusing on Russia and China, the diplomat explained that despite traditional “rivalry” between Moscow and Beijing, the pair are increasingly using the Shanghai Cooperation Organisation - a dormant anti-terrorist club formed in 2001 - to discuss the energy map in Central Asia.

He described the duo’s strategy on Central Asia as a “head of state approach” that differs from the EU’s €750 million Central Asia aid package for 2007 to 2013, which is based on wider social, trade and environmental projects designed to nurture long-term stability.

“I don’t think there’s an equivalent from Russia or China in terms of water or environmental management,” Mr Morel said, adding that EU “institutional strengthening” - it wants to remodel Central Asian judiciaries and parliaments - is the only way to bring in major, international energy investors.

“Just having a head of state approach will not help,” he explained. “The Russians have not struck the right level yet. These countries fear the return of Russia or at least of energy being used as a leverage against them.”

Kazakhstan, Turkmenistan and Uzbekistan broke away from the Soviet Union in the 1990s and are believed to hold up to 5 percent of the world’s energy resources.

But almost all their oil and gas exports to Europe are currently shipped via Russian-owned pipelines, with Brussels feeling increasingly uncomfortable about its energy dependency on the Kremlin.

Russia’s post-colonial game
In terms of Russia’s “head of state approach,” Moscow’s tactics seem to consist of a mix of intimidation and encouragement for the authoritarian regimes that run the three energy-rich Central Asian states.

“Turkmenistan is very important in terms of gas deliveries to Russia. Russia is going to use Turkmenistan to meet its [natural gas export] commitments,” Mr Morel explained, six months after the sudden death of Turkmen president, Saparmurat Niyazov, which handed control of the country back to the Soviet-era administrative elite.

Estonian socialist MEP Katrin Saks also told Mr Morel on Tuesday that “It was clear during our talks that Kazakhstan was being put under great pressure from Russia on the energy issue,” after visiting Astana as part of a European Parliament delegation last week.

In the case of Uzbekistan, Russia and China’s willingness to tolerate gross human rights violations have seen Uzbek government-backed Russian and Chinese investors drive out US and German companies at a “spectacular” rate, Ms Saks said.

The Turkey question
Meanwhile, EU candidate Turkey sees itself as a natural partner for EU energy interests in Central Asia, due to its geographic position and historic links with the ethnically-Turkic population scattered in neighbouring states. But some analysts wonder how Ankara will react if its bid to join the EU fails.

“Turkish policy towards Central Asia…has a tendency to ebb and flow as Turkey is rejected or not by the west, and the result is that now we see Turkey embracing Central Asia once again with a renewed emphasis on pan-Turkism,” Raffaello Pantucci of the London-based International Institute of Strategic Studies told EUobserver.

“If it plays its cards right, it could become a critical nub for Central Asian energy supplies…[which] seems to be one of Turkey’s major alternatives in the face of European rejection,” he added.

“We have special ties and vested interests in the Eurasia region, but we have never viewed our relations with the region as an alternative to our EU course,” a Turkish diplomat said. “I don’t think Mr Sarkozy’s presidency will change our position on that,” the contact added, on the new French president’s anti-Turkey accession policy.

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[Comment] The EU and Central Asia: from great gaming to gradual playing.

By Raffaello Pantucci, EUOBSERVER / COMMENT (an oppinion piece) May 9, 2007.

The European Commission is not prone to dramatic or sudden shifts, which is the product of a long tradition of rational contemplation that Europeans are so proud of, but more literally, it is due to the simple reality of juggling a decision-making process that has 27 members involved in it. One product of this are ruminative foreign policies, like the new EU policy on Central Asia, that may seem paralysingly slow to outsiders, but in reality have a distinct forward momentum.

It is instrumental to examine early drafts that have been circulating of the EU’s new strategy on Central Asia through this prism and therefore view them with some tentative optimism. We have not seen any grand offerings of immense wealth or exaggerated security benefits; we instead view a branch being offered that attempts to marry the hard economic realities of European energy needs with a desire to help nurture European democratic norms in another part of the globe.

It is not surprising that we have seen this renewed interest in Central Asia under a German Presidency. Germany remains the only European member state with a full complement of embassies in all five Central Asian states, and chancellor Merkel and foreign minister Steimeier have both repeatedly spoken of their desire to reach out and stabilize European relations with their Eurasian partners.

Furthermore, chancellor Merkel has also presented herself as a European leader who is willing to take a more robust stance in regards to Russia. This has not resulted, as some feared, in an apocalyptic schism with Russia, but rather it has produced the beginnings of a balancing in relations between Russia and the EU. While there are undeniable tensions coming to the surface once again - it is worth noting that so far no-one has suggested that Russia turn off the gas taps.

In this regard it is particularly interesting to note that Russia as a topic in early drafts fails to merit much mention at all. A very early draft referred constantly to a strong Russian presence in the region, while in later ones Russia is only noticeable where it would appear to be missing. There is an emphasis on the importance of gas deliveries from the region, the “construction of new oil and gas pipelines to Europe,” and the word “diversification” is used regularly in an energy context. No mention of the EU’s current key energy supplier and former big brother to Central Asia.

Instead, the EU strategy seems to be a seven-pronged approach with a heavy emphasis on the softer side of relations: youth and education; human rights, rule of law, good governance and democratization; economic development, trade and investment; energy and transport links; environment and regional water security; combating terrorism, transnational crime, and drugs; and finally a typically nebulous European desire to “promote dialogue within civil society and respect for freedom of religion.”

At every level, the emphasis is made to work towards “common aspects as well as specific nation contexts,” showing an EU awareness that each nation in the group has varying needs, and there are clear incentives - the doubling of “financial means to assist Central Asia” and the offer to “support…the WTO accession process and eventual membership” of all five members of the Central Asian cluster (currently only the Kyrgyz Republic is a member of the WTO, while Kazakhstan, Tajikistan and Uzbekistan remain observers and Turkmenistan is completely outside).

On the other hand, however, there is an unavoidable emphasis on “democracy” and “human rights,” something that sparked the anthropological rebuke to “take into consideration [our] countries’ national traditions, history, and…mentality” from Uzbek foreign minister Vladimir Norov at a joint press conference on March 28th in Astana.

This is a not entirely surprising comment given the EU’s ongoing retention of an arms and travel embargo on Uzbekistan. Initially a reaction to the May 2005 incident at Andijan (where an unknown number of protestors were killed by government forces) the sanctions and the subsequent Uzbek decision to ask the United States to abandon bases on its territory have left EU-Uzbek and US-Uzbek relations on hold. The main result of this has been for Uzbekistan to wander into the warm embrace of its Russian and Chinese neighbours, who offer a less emphatically “democratic” and more pragmatic relationship.

What is particularly interesting about the new EU strategy, however, is its awareness of the new “great game” that it is trying to play a part of in the region. “Human rights” may play a prominent role, but they are matched by a bevy of realpolitik economic and energy related carrots. While they are not quite the no-strings-attached offers put on the table by the Chinese, they do instead offer “sustainable development” and “capacity building” in contrast to the Chinese tendency to prefer to rely on their own firms to construct local capacity.

There is further no mention of the United States or NATO, both subjects with historical baggage: it seems the EU is eager to re-write its history from scratch in Central Asia. China and the Shanghai Cooperation Organization only merit a strategically brief mention in the fight against drugs and transboundary crime in the region.

Internally within the EU, there are many reasons for optimism within this renewed strategy. Germany has made a point of aligning its policies as presidency of the EU with the next two presidencies (Portugal and Slovenia), providing some unusual continuity in European policy. Currently, the EU is broadly shut out of Central Asia, and shares no contiguous borders with the region: the positive side to this is that the EU is able to steer the rudder towards an internal consensus on the region without having too many onerous member state caveats attached to potential policy. And the member state with the most to worry about, Germany, is the one currently at the rudder anyway.

At a time when European credibility in the world is slipping, a successful policy towards Central Asia would provide the EU’s Common Security and Foreign Policy with a much needed shot in the arm. Hopefully a nurturing incrementalist policy, that will not devolve into an all-too-common Euro-stagnation.

Raffaello Pantucci is a research associate at the London-based think-tank, the International Institute for Strategic Studies

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France wants to save major part of EU constitution, Sarkozy aide says.

By Lucia Kubosova, EUOBSERVER / BRUSSELS, May 8, 2007.

France’s Nicolas Sarkozy will seek to maintain as much of the rejected EU constitution as possible in the upcoming talks on a new treaty for the bloc, a top aide to the president-elect has told EUobserver.

Alain Lamassoure, a prominent centre-right MEP and tipped to be the new Europe minister in the Sarkozy government, said Paris will agree to stick “as much as possible to the original text.”

His comments indicate that Mr Sarkozy is in favour of a re-packaged text containing essentially the same elements.

Referring to removing the EU symbols proposed in the original text as part of a general approach to take away the constitutional feel to the new treaty, Mr Lamassoure said “we will play the European hymn or fly the flag whether it is mentioned in the new treaty or not.”

He added that the same applies to the exact title of the future EU’s foreign affairs minister. “As long as his status and powers are preserved we’re fine with [a title change].”

He expects the new “ordinary treaty” - adopted by national parliaments where possible - will have a maximum of 130 instead of the 448 articles originally proposed.

The institutional changes should remain untouched while the Charter of Fundamental Rights, currently appearing as a whole within the text and raising several legal question for member states - being referred to by a single article.

“That way, the charter can be interpreted as legally binding in some countries, such as France and Germany, and non-binding in others, such as the UK.”

Referring to the third part of the constitution which lists EU policies, Mr Lamassoure, who is part of Mr Sarkozy’s inner political circle, says “we must distinguish between provisions that are already present in previous treaties and can be dropped as we do not need to replicate them and the new provisions which need to remain.”

He indicated France is not prepared to compromise on the list of new areas to be decided by qualified majority rather than unanimity, while admitting that this could become one of the most contentious issues, particularly for the UK.

“This is non-negotiable as it is one of the provisions with the most important added value of the new treaty which seeks to help the enlarged EU to work more efficiently.”

The MEP’s statements are the first clear public indication of what Paris will be calling for at the EU table when leaders meet to discuss a new institutional settlement next month – a clear French position on the issue has been lacking since French voters rejected the constitution in a referendum almost two years ago.

Defining Europe’s borders
Touching on another highly controversial issue, Mr Lamassoure said Paris is going to push for a definition of the bloc’s borders in the coming months and a “reorientation” of talks with Turkey.

“EU leaders have been lying to Turks for the past few years and the new French leadership believes we must stop doing so,” he said, referring to the bloc’s membership negotiations with Ankara kicked off last October.

He argues that citizens in most EU member states are against Turkey joining the union and that it was a main factor in the French rejection of the EU constitution.

“The sooner we will have the courage to say this openly to Turkey the better,” said Mr Lamassoure, pointing out that Paris will seek a “re-orientation” of the whole accession talks in which “at the very least, we clearly open other options for the final outcome -other than membership.”

“If everything goes well and we agree on the revised EU treaty by the end of this year we envisage that we could also at the same time present to citizens a common political declaration on the ultimate borders of Europe,” Mr Lamassoure said.

He said that Paris recognizes the bloc’s commitments to the Balkan countries but that “the [EU] borders must be that of the continent.”

His comments come on the back of a presidential campaign by Mr Sarkozy in which he repeatedly said he was opposed to Turkish membership.

Mr Lamassoure said that while Mr Sarkozy will be careful not to hijack next month’s summit on drawing up an EU treaty with the Turkey question, “we definitely don’t want to postpone this issue for too long.”

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Call for veto powers for MPs in new EU treaty.

By Honor Mahony, May 9, 2007.
Prague, Warsaw and the Hague are lobbying to get more power for national parliaments written into a new-look constitution for the European bloc.

According to a report in the German daily Handelsblatt, the three countries want MPs to have the right to refuse legislation coming from Brussels.

At the moment the constitution - rejected by Dutch and French voters two years ago - gives parliaments the right to complain about proposed EU legislation, but the European Commission is not obliged to withdraw it despite any complaints.

Under the trio’s veto scheme, if a third of national parliaments objected to a proposed EU law then it would automatically fail.

This idea also came up during the year and a half long convention to draw up the EU constitution in 2001-2002, but was rejected after opponents argued it would upset the balance of power between the EU institutions - it was particularly opposed by representatives from the European Parliament.

German centre-right MEP Elmar Brok, who was in Berlin along with his colleagues from the parliament’s constitutional affairs committee, told Handelsblatt that the “right of veto for national parliaments would mean the introduction of a virtual third chamber.”

According to the MEP, the the Polish, Czech and Dutch plan also faces some opposition from within the German chancellor’s office.

Treaty talks gather pace
The idea is part of overall negotiations on the EU treaty, which are gathering pace as a June deadline approaches for agreeing the skeleton of a new-look constitution and a timetable for its implementation.

While 18 countries have mainly ratified the original constitution, several of the remaining nine are making demands for change so that they can better sell it to a sceptical domestic public.

Among the most controversial areas are proposals for a new voting system in the treaty - Poland has asked for changes to be made - and the extension of qualified majority to several new areas, which is problematic for Britain.

The Dutch government meanwhile has been making it clear it cannot go back to The Hague without having secured substantial changes to show it has taken on board the rejection of the constitution by Dutch voters in June 2005.

According to sources, a new treaty is also set to have some additional features - including a mention of fighting climate change and an energy solidarity clause, the last as a sop to Warsaw.

It is also expected that enlargement criteria will be written into the new treaty.

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[Comment] Turkey may be France’s price for the new EU treaty

May 11, 2007, Opinion Piece by Peter Sain ley Berry EUOBSERVER / COMMENT.

Two weeks ago I suggested in these pages that from a European perspective the French Presidential contender Ségolène Royal might be a better choice than Nicolas Sarkozy.

I argued that it would be necessary to put any revised constitutional treaty to a second referendum in France (the alternative would be to enlarge the EU’s democratic deficit to dangerous proportions). As the opposition to the first treaty had come, at least in part, from a perception that it would undermine the French system of social welfare, a left-wing president could more easily reassure voters, I argued, and so carry such a referendum early in her first term.

It was perhaps a forlorn piece of analysis, for within a point or two the outcome of the second round, which elected Nicolas Sarkozy, was clear from the results of the first. All the evidence showed that supporters of the centrist, François Bayrou, would divide equally between both camps. And this they did. It would have needed three-quarters of them to have backed Ségolène Royal for her to have scraped a win and all of them for her to have won convincingly. This was never going to happen.

The policies of M. Sarkozy are widely held to be what France needs. I wouldn’t dissent from that view. His ideas on economic reform also chime with the greater part of the Commission’s free market Lisbon agenda, now beginning to show results in terms of rising levels of GDP growth. Though before the free market contingent get too carried away we must remember that the new French President-elect is still at heart an economic nationalist, like his predecessor.

Whether he will be able to implement the reforms he wishes to see is of course another matter. Sarkozy has been likened to Margaret Thatcher, Prime Minister of Britain from 1979 to 1990, who carried through far reaching economic reforms and broke what was perceived as the trade union stranglehold on enterprise. But Thatcher, at least in her early days, embodied a good deal of popular will, importantly from across the working population. Whether Sarkozy has that same support is doubtful.

An interesting analysis by Eric Dupin writing in Le Figaro shows that apart from business owners and the Poujadist rump of the self-employed, those in paid employment voted more often for Royal than for her rival. Sarkozy’s real support came from the older generation, the over 50s, people in the main who were either retired or otherwise inactive economically. Royal had far more support among the young and the employed.

Sarkozy may pose the question, ‘who governs France?’ But the unions may answer ‘we do’ and, moreover, have the forces on the ground to prove it. The President’s irresistible force may meet an immovable object - the resulting stalemate doing neither France nor the rest of Europe much good.

The resistance is likely to be heightened if Sarkozy tries to ratify a new constitutional treaty, in effect the old treaty with a new name, through Parliament alone. We assume that he will be able to command a majority in the Assembly, at least on this issue, though even that cannot be taken for granted.

The idea of a truly mini-treaty, limited to updating voting weights in the European Council and giving that body a semi-permanent Chair, seems to have disappeared. Except in capitals such as London and Warsaw, it always seemed an impractical suggestion.

The European Commission is also viewing Sarkozy with apprehension over his attitude to Turkey. During the election he made it plain that while he accepts the Balkan states should eventually be admitted to the Union, this does not extend to Asia Minor. The talk is all about other types of relationships that might be invented for Turkey (and presumably other non-Balkan aspirants such as the Ukraine).

He is, of course, not alone in voicing such doubts; other leaders, indeed the German Chancellor herself, have never been convinced of Turkey’s future place in Europe, however far in the future that place may lie.

This has led to a ruffling of feathers in the Berlaymont hencoop, with no one quite sure whether to ignore the French President-elect or to remind him of Europe’s obligations. As he is only President-elect - and on holiday to boot - he is something of a will o’ the wisp. He cannot easily be criticised. Nevertheless, guarded statements about the necessity of respecting European commitments are cropping up with regularity. Even Margot Wallström had a pop at him on her blog this week.

It is not impossible that Turkey might commit some act of folly - such as a military coup - that would disbar the country, at least for a while - and let Europe of the hook. Recent rumblings from the Turkish military about the need to safeguard Kemal Attaturk’s secular legacy were serious enough and led Olli Rehn, the Enlargement Commissioner, to issue a veiled reminder about the need to respect state institutions.

Not impossible perhaps, but unlikely. Which will leave us in a tricky position come June when Mrs Merkel hopes and expects to have the roadmap to the EU’s constitutional reform agreed.

I have to say the prospects for this were looking uncertain before Sarkozy’s election; after it they look even bleaker. Sarkozy appears likely to insist that the new treaty does not compromise on the issues to be settled by majority voting that were written into the old treaty. This may prove contentious, especially, in London, where Gordon Brown is expected to have taken over from Tony Blair by mid-July.

But it is Sarkozy’s position on Turkey and his insistence that a new treaty say something about the EU’s boundaries that is likely to prove more difficult - at least in the short time that remains. I happen to agree with this position and have argued the point several times in this column. But to attempt an agreement on this in the few weeks that remain before the June European Council may well prove impossible.

Nevertheless, some statement along these lines may be Sarkozy’s price for delivering a French ratification. He may even have the majority of the French electorate behind him also. He is something of a Napoleonic figure, after all; not averse to using a whiff of grapeshot to get his way. I foresee trouble ahead.

The author is editor of EuropaWorld

Now, as we go much less to the UN as before, this thanks to the UN gate watchdogs Fawzi & Fowlie, who are intent, by hook or crook, to remove the inquiring press from being present in the Press Briefing room - now - I do not make this up - it slowly will be documented on this site, the positive attitude is that we have now more time to review events in the real world. Thursday the April 12th we attended three such events.

A. 12:30 - 14:00 PM   - The Presentation by old Natural Gas hand, Jonathan Stern - the Director of  Gas Research, Oxford Institute of Energy Studies, and Honorary  Professor at the Centre for Energy, Petroleum & Mineral Law & Policy, University of Dundee. Since 1992 he has been Associate Fellow of the Royal Institute of International Affairs’ Sustainable Development (formerly Energy and Environment) Programme; and since 2001 Honorary Principal Research Fellow in the Department of Environmental Science and Technology at Imperial College in London. From 1985-92, he was Head of the Energy and Environmental Programme, based at the Royal Institute of International Affairs in London. From October 1990 to September 1991, he was Director of Studies at the Institute. Jonathan P. Stern is the author of “The Future of Russian Gas and Gazprom.”

This event was being hold at the Center for Energy, Marine Transportation and Public Policy, Columbia University, School of International and Public Affairs, 420 West 118th Street, New York, NY 10027
 www.CFR.org

B. 3:00 - 5:30 PM   - A very Special Event “A Letter To The Stars - Botschafter Der  Errinerung (”Ambassadors of Remembrance”)” which is a great story of Austrian Schoolchildren who through the internet were able to compile a very unique list of 2,500 people from Austria, who survived the Nazi regime in concentration camps, in hiding, or in exile, and now live around the globe. The Austrian high school students contacted on a one-to-one basis the people on that list, and asked them if they want to share their memories and experiences with young people from their former country, who really are trying to understand the human aspects of what has happened. Some of the exchanges, in a program that started in 2003, has by now become material for joint publications intended to keep the memory alive of this remnant of the survivors, before it is too late.The event held at the Museum of Jewish Heritage, 36 Battery Place, New York, NY and was attended by quite a few of these pairs of old&young friends - some of whom were just meeting for the first time, and others had already encounters when the former refugees/survivors came to visit in Austria.  www.MJHNYC.org.   The website of the Austrian Initiative: www.LetterToTheStars.at One such pair, both spoke at this reunion,  a young girl who found on that list the name of a man who lived in the same street in the Vienna district of Hitzing, where she and her parents reside now, and that was her reason for picking him for contact,  seem now to have become somehow an extended family- this because of that common angle in their humanity.

To-date, more than 40,00 high school students have participated in this project and it is the largest school project on contemporary history in Austria. Spin-off projects evolve - the like of the May 5, 2006 “Flowers of Remembrance” where the students put a white rose in front of the 80,000 known addresses were a victim of the Nazi regime used to live. In May 2005 the students took 100,000 candles to Mauthausen concentration camp in memory of the 100,000 people that were killed there. In May 2004 they planted 100,000 sunflowers there. In may 2003 they release 80,000 white balloons in the Heldenplatz in Vienna..

C. 5:30 - 8:00 PM - The Chicago Climate Exchange that is actually based in New York City, and Tudor Investment Corporation, presented at the Energy Forum Inc. of New York City, a discussion on matters relating to “Public Policy and Climate Change initiatives.”  This was about Carbon Trading as the financial mechanism to turn the Kyoto Protocol Mechanisms Into reality. NYU Professor of Economics, Dermot Gately, former consultant to the World Bank, the IMF, the US DOE, the IEA, ExxonMobil, ARCO, and Saudi ARAMCO, and is President of the Energy Forum Inc., was the Moderator, with Robert McNally, Managing Director of Tudor, and Paula DiPerna, Exec VP of the Exchange. Present at the Forum events are people from business Intelligence organizations, Law firms, some oil companies, academics etc.

In this article we will cover some of the things we heard from Mr.Stern in event (A), and we will bring out our own main idea that was born from the situation as described by Mr.Stern - then we will Jump over to event (C) and we will bring in the same question that we asked in event (A).

We will not write here further on ideas connecting that human aspect of event (B) that makes actually a very logical connection to what we have in mind, when talking of the issues in the other two events, but trust me, in some later article we will come back also to that.

THE JONATHAN STERN PRESENTATION:
Mr. Stern presented to us the Natural Gas supply and demand situation in Europe, the already existing shortage, and the projected future increased shortage when the UK also becomes now an importer of gas, the Netherlands starting their decline in production in 2015, and Norway in 2020. He does not see in this a “train wreck” he does not believe in increased imports via pipelines, but he thinks that eventually all will prefer the flexibility of sea transport as LNG. We saw all the potential pipelines involved - the pipelines via Tanger in Morocco, those through Sicily and those through Sardinia. Then the various pipelines from Russia and Central Asia, and his bottom line was that there will not be available the supplies needed to expand and diversify these pipelines at a time that Russia projects a large increase in its domestic market for gas.

He kept pointing out the double whammy, that Russia and the other former CIS are suffering from very old infrastructure, and very inefficient use of their Natural Gas, and the serious underpricing of the gas for their internal market. Nevertheless, they did increase the price to the Ukraine and Belorussian satellite (and transit) markets, pushing them to the level of international pricing, but they will be much slower doing that inside the country for internal policy reasons - thus continuing to suffer from the inefficiency of using a lot of cheap gas, rather then less gas at a higher price, that could come from rejuvenating their industry.

When the Q&A period arrived, I brought up the Kyoto Protocol mechanisms. At first, in all honesty, KP would not have come into existence if there were not people believing that the “hot air ” issue will give a boost to the former CIS. That so called “hot air” was created by the fact that Russian industry at that time, did halt to a stand still - so they could claim they are emitting less in 1997 then their industry did   emit in 1990. But nothing happened because the KP was not ratified fast enough - and now there is no “hot air” because they climbed back, with mainly the same old equipment, and emit now more then they should! But now, instead of using the CDM KP mechanism, why not go for the JI KP mechanism with full throttle? And backed up by government agreements that could thus also level some of the political disagreements between the EU and Russia - with the introduction of serious joint economic interests.

All EU-Russia meetings in the last couple of years deal with the gas supply to the EU, why not turn this into a — we build you highly efficient new industry and you provide us the gas saved at a going international price? That would be fair to everyone and everyone wins. There would be a saving of CO2 emissions in the former CIS, and this would justify the use of the Joint Implementation Kyoto Mechanism. On the European side, with gas they could start replacing coal fired plants, and also gain in environment terms further decrease in CO2 emissions. The Russian population would get their increased standard of living, but the difference is now that their improved industry would be less polluting!

Now lets go to the other side of the ocean, to the late evening discussion at the McGraw Hill building.


THE PAULA DI PERNA and the Chicago Climate Exchange PRESENTATION:
She was talking about the permits’market in the US and in Europe - this at a time that the US Supreme Court makes it possible to have non-challenge-able State reductions rullings of CO2 emissions - even with a still recalcitrant Federal Administration. This was for the first time that I heard the Chicago Exchange get on solid ground. Before, when they initiated a contract based on voluntary participation, it looked to me as a great idea to have the exchange there ready, when the government removes its damming activity on the anti-global warming international and national activities - we said that the talk of voluntary action is the US version of ‘hot air.” It was not very attractive to sit in Chicago or New York and to try to take advantage of laws that were passed in Europe, but rejected by Washington. An exchange in the US, needs US clients, and US clients will come about if there are US laws - that seems to me simple logic.

OK, now, after the large markets for permits in Germany (the Largest), the Netherlands, it is California and the North East (the RGGI region), that together amount to half of the German market. But this is a start - now we have something to go by, and those ready to invest, can indeed prepare to do so.

Now again my question from the earlier meeting. Could the Chicago Exchange get involved in creating permits by working with the Russians? It is quit feasible but they think the Europeans will get involved, but then sometimes a technology might be available here and the EU really wants the gas - so with US involvement, there is a risk-spreading effect and credits are credits - specially as it was pointed out by Mr. Robert McNally that Senator Obama made the correct obsevation about Liquefied Coal that it is still …coal. So, the US idea of createing a new source for US fuels via coal liqefaction, will never fly in a Kyoto, or post-Kyoto context.


 

An  Institute That Could Help Solve Central Asian Disputes - Specially On Water Use But Also For Energy.

ASTANA, Kazakhstan, April 5, 2007, ENS- {Published in cooperation with News Briefing Central Asia, an independent network of journalists based in Bishkek. NBCentralAsia is a project of the Institute for War & Peace Reporting, IWPR.}

 A proposal by Kyrgyz Foreign Minister Ednan Karabaev to establish a regional research institute for water and energy could help end the persistent political wrangling over cross-border water use in Central Asia.

During a meeting between European Union delegates and foreign ministers from all five central Asian states in Astana on March 28, held to consult on the new EU strategy for the region, the Kyrgyz foreign minister put forward a proposal to set up a Water and Energy Academy in the Kyrgyz capital of Bishkek, with the EU’s support.

Kyrgyz Foreign Minister Ednan Karabaev proposes to establish a Central Asian water and energy research institute in Bishkek. (Photo courtesy Government of Kyrgyzstan)

The new institute would train experts from all the Central Asian countries on hydroelectric power, while undertaking research that will benefit the region, Karabaev said.
Central Asia’s largest rivers have their sources in the mountains of Kyrgyzstan and Tajikistan. These two countries use the water flow mainly to generate electricity, whereas Uzbekistan and Kazakstan further downstream rely on the water for crop irrigation.

Although numerous mechanisms and plans have been produced to manage water use, the upstream and downstream countries have failed to agree on terms that would be acceptable to all. Political and water analysts in Kyrgyzstan and Tajikistan say developing a regional-level academic centre for water management could help Central Asia reach a common view of how the resource should be distributed.

Erkin Orolbaev, a Kyrgyz expert on water issues, said the institute may well achieve this goal if it is internationally recognized and recruits capable lecturers and researchers from the region and the rest of the world.

Anatoliy Kholmatov, technical director at the International Fund for Saving the Aral Sea based in Dushanbe, Tajikistan, points out that a similar initiative was launched in 2003 at an international forum on fresh water. The plan then was to have an International Water Center based in Dushanbe to look at water, related social issues, and electricity generation. The center is currently under construction.

But Kholmatov says the Kyrgyz initiative is a good one, as a great deal of research is needed to develop the economic mechanisms for shared water use.

According to a senior official in the Tajik Ministry of Energy and Industry, the academy should be a place where experienced energy officials can get advanced training and network rather than a college for training new people from scratch.

“If this is an academy for advanced training, something serious may come of it… Personal connections, which often count for a lot, will be able to have a major impact on decision-making,” he said.

Almost all the experts interviewed agree that simply strengthening research capacity will not solve water disputes – there must also be the political will to do so.

Bazarbay Mambetov, a Kyrgyz energy expert said, “The problem can be solved through constructive talks among the regional states, provided their leaders are willing and ready to do this.”