Friday, 6 June 2008

Thursday, 5th June 2008


At food-crisis talks, nations struggle to agree on declaration
Late Thursday afternoon, delegates had not yet completed a formal declaration from the conference. A draft copy calls for urgent action to address the problems associated with higher food prices, for increased food production, and for fewer trade restrictions and increased research in agriculture.
The draft declaration, however, largely sidestepped biofuels, which had emerged as the most controversial issue at the conference. Some developing countries argued that food crops should not be used for fuel, but the declaration simply urged more research on the subject.
As Mary Chinery-Hesse, chief adviser to President John Kufuor of Ghana, said: "Such international get-togethers have ended with lofty statements and commitments which have not, sadly, been delivered or moved to implementation. The food crisis which the world faces today is so serious that it would be disastrous for the survival of mankind if the conclusions reached suffer the same fate."
Even so, Lennart Bage, president of the International Fund for Agricultural Development, an arm of the UN, said the conference was a success if only because it focused the world's attention on the needs of agriculture.
"I think there is momentum that is unique over the last 25 years," he said. "When did you have heads of state coming to talk about seeds and fertilizer?"
Investing in farmers
Have the leaders gathered at the UN Food and Agriculture Organization in Rome forgotten that we need to invest in the "human capital" of farmers?
The article "Wealthy nations criticized over food crisis" (June 4) cites only "three immediate priorities" emphasized by Robert Zoellick, president of the World Bank: feeding the hungry, providing seeds and fertilizer, and scrapping export restrictions.
Surely, to increase food production capacity and productivity of developing countries it is also necessary to cater to the basic needs of the farmers themselves. Governments should ensure that farmers get a better education, necessary agricultural know-how and training, and improved access to health care.
Moreover, an updated national agricultural strategy in the context of the overall economy would facilitate allocation of available resources to these basic needs.
Thus, enhancing global food security will continue to require close cooperation among the wealthy nations and developing countries. Responsibility or blame cannot be laid at any single door for the current global food crisis.
Jens A. Jorgensen, Brussels
AFTER THE CYCLONEA cruel sequel to a cruel blow
Tony Banbury is the Asia regional director of the United Nations World Food Program.
WFP brings food by barge from Yangon to Bogale, where it is off-loaded on to smaller river boats - those still afloat - for distribution down river. I spoke to a doctor from Doctors Without Borders, one of the few international aid organizations allowed to spend several days working in the area, who estimated that 80 percent of the people living south of Bogale lost their lives to the 12-foot-high surge of water that Cyclone Nargis blew up the delta and over land on the night of May 2 to 3. After flying over the delta for hours, and stopping in five towns and villages, that estimate horrified me, but did not surprise me.
It is the beginning of the monsoon season in Myanmar, and the fields should be ready for planting rice. The Ayewarddy Delta is the rice bowl of Myanmar and used to be a major source of rice for the region and beyond.
As I flew over the traditional Southeast Asian patchwork of rice paddies I tried to estimate how many had a farmer and a water buffalo preparing for planting. It was about one in 400, maybe one in 500.
This suggested to me that the food problems of the frail, elderly lady I met in Aya are far from over.
Boom in food prices raises appeal of farmland as an investment
Huge investment funds have already poured hundreds of billions of dollars into booming financial markets for commodities like wheat, corn and soybeans.
But a few big private investors are starting to make bolder and longer-term bets that the world's need for food will greatly increase — by buying farmland, fertilizer, grain elevators and shipping equipment.
One has bought several ethanol plants, Canadian farmland and enough storage space in the Midwest to hold millions of bushels of grain.
Another is buying more than five dozen grain elevators, nearly that many fertilizer distribution outlets and a fleet of barges and ships.
And three institutional investors, including the giant BlackRock fund group in New York, are separately planning to invest hundreds of millions of dollars in agriculture, chiefly farmland, from sub-Saharan Africa to the English countryside.
"It's going on big time," said Brad Cole, president of Cole Partners Asset Management in Chicago, which runs a fund of hedge funds focused on natural resources. "There is considerable interest in what we call 'owning structure' — like United States farmland, Argentine farmland, English farmland — wherever the profit picture is improving."
These new bets by big investors could bolster food production at a time when the world needs more of it.
The investors plan to consolidate small plots of land into more productive large ones, to introduce new technology and to provide capital to modernize and maintain grain elevators and fertilizer supply depots.
But the long-term implications are less clear. Some traditional players in the farm economy, and others who study and shape agriculture policy, say they are concerned these newcomers will focus on profits above all else, and not share the industry's commitment to farming through good times and bad.
"Farmland can be a bubble just like Florida real estate," said Jeffrey Hainline, president of Advance Trading, a 28-year-old commodity brokerage firm and consulting service in Bloomington, Illinois. "The cycle of getting in and out would be very volatile and disruptive."
By owning land and other parts of the agricultural business, these new investors are freed from rules aimed at curbing the number of speculative bets that they and other financial investors can make in commodity markets. "I just wonder if they need some sheep's clothing to put on," Hainline said.
Mark Lapolla, an adviser to institutional investors, is also a bit wary of the potential disruption this new money could cause. "It is important to ask whether these financial investors want to actually operate the means of production — or simply want to have a direct link into the physical supply of commodities and thereby reduce the risk of their speculation," he said.
Grain elevators, especially, could give these investors new ways to make money, because they can buy or sell the actual bushels of corn or soybeans, rather than buying and selling financial derivatives that are linked to those commodities.
When crop prices are climbing, holding inventory for future sale can yield higher profits than selling to meet current demand, for example. Or if prices diverge in different parts of the world, inventory can be shipped to the more profitable market.
"It's a huge disadvantage to not be able to trade the physical commodity," said Andrew Redleaf, founder of Whitebox Advisors, a hedge fund management firm in Minneapolis.
Redleaf bought several large grain elevator complexes from ConAgra and Cargill last year for a long-term stake in what he sees as a high-growth business. The elevators can store 36 million bushels of grain.
"We discovered that our lease customers, major food company types, are really happy to see us, because they are apt to see Cargill and ConAgra as competitors," he said.
The executives making such bets say that fears about their new role are unfounded, and that their investments will be a plus for farming and, ultimately, for consumers.
"The world is asking for more food, more energy. You see a huge demand," said Axel Hinsch, chief executive of Calyx Agro, a division of the giant Louis Dreyfus Commodities, which is buying tens of thousands of acres of cropland in Brazil with the backing of big institutional investors, including AIG Investments.
"What this new investment will buy is more technology," Hinsch said. "We will be helping to accelerate the development of infrastructure, and the consumer will benefit because there will be more supply."
Financial investors also can provide grain elevator operators the money they need to weather today's more volatile commodity markets. When wild swings in prices become common, as they are now, elevator operators have to put up more cash to lock in future prices. John Duryea, co-portfolio manager of the Ospraie Special Opportunity Fund, is buying 66 grain elevators with a total capacity of 110 million bushels from ConAgra for $2.1 billion. The deal, expected to close by the end of June, also will give Ospraie a stake in 57 fertilizer distribution centers and the barges and ships necessary to keep them supplied with low-cost imports.
Maintaining these essential services "helps bring costs down to the farmers," Duryea said. "That has to help mitigate the price increases for crops."
Duryea of the Ospraie fund dismissed the idea that financial investors, with obligations to suppliers and customers of their elevators and fertilizer services, would put their thumb on the supply-demand scale by holding back inventory to move prices artificially.
"It is not in our best interests for anyone to be negatively affected by what we do," he said.
Perhaps the most ambitious plans are those of Susan Payne, founder and chief executive of Emergent Asset Management, based near London.
Emergent is raising $450 million to $750 million to invest in farmland in sub-Saharan Africa, where it plans to consolidate small plots into more productive holdings and introduce better equipment. Emergent also plans to provide clinics and schools for local labor.
One crop and a source of fuel for farming operations will be jatropha, an oil-seed plant useful for biofuels that is grown in sandy soil unsuitable for food production, Payne said.
"We are getting strong response from institutional investors — pensions, insurance companies, endowments, some sovereign wealth funds," she said.
The fund chose Africa because "land values are very, very inexpensive, compared to other agriculture-based economies," she said. "Its microclimates are enticing, allowing a range of different crops. There's accessible labor. And there's good logistics — wide open roads, good truck transport, sea transport."
The Emergent fund is one of a growing roster of farmland investment funds based in Britain.
Last October, the London branch of BlackRock introduced the BlackRock Agriculture Fund, aiming to raise $200 million to invest in fertilizer production, timberland and biofuels. The fund currently stands at more than $450 million.
Braemar Group, near Manchester, is investing exclusively in Britain. "Britain is a nice, stable northwestern European economy with the same climate and quality of soil as northwestern Europe," said Marc Duschenes, Braemar's chief executive. "But our land is at a 50 percent discount to Ireland and Denmark. We just haven't caught up yet."
Europe, like the United States, is facing mandated increases in biofuel production, he said, and cropland near new ethanol facilities in the northeast of England will be the first source of supply. "No one is going to put a ton of grain on a boat in Latin America and ship it to the northeast of England to turn it into bioethanol," he said.
For Gary Blumenthal, chief executive of World Perspectives, an agriculture consulting firm in Washington, the new investments by big financial players, if sustained, could be just what global agriculture needs — "where you can bring small, fragmented pieces together to boost the production side of agriculture."
He added: "Investment funds are seeing that this consolidation brings value to them. But I'm saying this brings value to everyone."

U.S. Senate report cites intelligence flaws in lead up to Iraq war


"The president and his advisers undertook a relentless public campaign in the aftermath of the attacks to use the war against Al Qaeda as a justification for overthrowing Saddam Hussein," said Senator John Rockefeller 4th, the West Virginia Democrat who is chairman of the Senate Intelligence Committee, in a statement accompanying his committee's 171-page report.

Nuclear safety in question after leak at plant in Slovenia

The Slovenian authorities shut down the plant in Krsko, near the Slovene-Croatian border, after the leak Wednesday evening. The leak was confined to the plant building and caused no damage, the plant authorities said.
But the Austrian environment minister, Josef Pröll, said the leak, which set off an EU-wide alert, demonstrated the danger that reactors pose to Europeans and the environment.
"Austria has always taken a critical stance on nuclear energy," Pröll said in Luxembourg, where EU environment ministers were meeting for talks Thursday. "For me, such incidents confirm our view."

France, the Czech Republic and Slovakia want full EU recognition of nuclear power as a "clean energy" alternative to carbon-based power sources.
The Italian environment minister, Stefania Prestigiacomo, said the leak in Slovenia would not affect Italian plans to restart its nuclear program. The government of Prime Minister Silvio Berlusconi plans to re-introduce nuclear energy despite its ban in a 1987 referendum.

Russia shutters 2nd of its 3 remaining plutonium reactors

The ADE-5 reactor at the Siberian Chemical Plant in Seversk stopped operation and workers will begin removing remaining uranium fuel, said the atomic energy agency, Rosatom, in a statement. It will take several years to dismantle the reactor's technical equipment.

Mexico's missing $3 billion: The mystery over Pemex

Congress is in the middle of two months of public debate over a government proposal to overhaul Petróleos Mexicanos, as the state oil company is formally called. Oil reserves and production in Mexico, the world's sixth-largest oil producer, are declining.
At the heart of President Felipe Calderón's proposal is the argument that the oil company does not have the billions it needs to find, pump and refine more oil. The government uses Pemex to finance about 40 percent of its budget, leaving the company short of money to invest.
The missing windfall is evidence of Pemex's problems. It is a product of sagging exports, increasing fuel imports and the cost of subsidizing Mexico's below-market gasoline prices, according to the Finance Ministry.
Many outside analysts accept the government's explanation. "The numbers are quite clear," said Carlos Elizondo Mayer, a political analyst at CIDE, a Mexico City research firm.

In the first quarter, the price for Mexican oil averaged 40 percent more than the budget's estimate, a jump that should have delivered an extra $3 billion to the Treasury. But declining production meant that Pemex exported almost 12 percent less crude than Congress estimated when it passed the budget last year.
At the same time, gasoline imports spiked 39 percent because of higher volumes and prices than legislators estimated. A strong peso hurt, too, because Mexico received less in peso terms for its dollar-denominated oil sales.
The result, the Finance Ministry said, was a shortfall of about $800 million.
Miguel Messmacher, a top Finance Ministry official, said that the formula, which has not changed this year, used to calculate the windfall was confusing.
"The mechanisms are complex," he said. "But they are made with the idea that the windfall isn't distributed unless you have it."
This year, for the first time, the costs of subsidizing controlled gasoline prices have shown up very significantly in the books - at a cost of about $5 billion to the government in the first quarter.

Iraq oil deals could lift production
DUBAI: Iraq is exporting more oil than it has for years and is on the verge of signing deals with oil majors that could quickly take output higher, oil officials said.
Baghdad expects this month to conclude negotiations for six oil-field service contracts with international companies that could further increase output this year.
The deals could provide the extra 200,000 barrels a day in exports that Iraq wants from the southern Basra terminal by the end of 2008. Basra accounts for most of Iraqi exports, shipping more than 1.5 million barrels a day.
"Provided they are signed promptly, these deals could give quick progress," said an executive at a Western oil company negotiating for one of the contracts. "They are the first step towards real improvement in a sector that has been under stress for 30 years."
Baghdad expects exports in June to reach 2.2 million barrels a day, the highest for monthly shipments since the U.S.-led invasion of March 2003. Baghdad sees exports rising further, to 2.3 million barrels a day, by the end of 2008.

Iraq has a 10-year plan to lift output from 2.5 million barrels a day this year to 6 million barrels per day, Shahristani said this week. It aims to hit 4.5 million barrels a day in five years.
But for those larger long-term gains, Iraq needs the oil law in place so that international oil companies can play a bigger role in developing untapped fields.
"We remain very cautious in terms of further capacity expansion," said Alex Munton, analyst at the global consulting company Wood Mackenzie. "Iraq has almost reached the point, simply by repairing the damage of the last few years and adding security around main pipelines, of maximum capacity with the infrastructure in place. But there is little likelihood of being able to add to that without much larger-scale investment and the assistance of international oil companies."

Detroit automakers vie for diminishing truck market
Last winter, when Chrysler paraded 120 Texas longhorns outside the Detroit auto show to promote its 2009 Dodge Ram, and Ford brought in the country superstar Toby Keith to unveil its new F-series truck, full-size pickups accounted for 13 percent of the United States vehicle market. They were just 9 percent of the market in May, when for the first time since 1992 the country's top-selling vehicle was a car - the Honda Civic compact sedan - rather than a truck.
In fact, the top four sellers last month were all cars, pushing the current 2008 F-series down to fifth place, which would have once been unthinkable, as its sales fell 33 percent. Sales plunged 38 percent for the 2008 Ram and 44 percent for the Chevrolet Silverado, which was redesigned two years ago and will have even more difficulty competing against two newer trucks this fall.

Three years ago, 3 out of every 10 vehicles that Ford's three domestic brands sold in the United States were F-series trucks; on an annual basis, the F-series has been the nation's best-selling vehicle since 1976.
Last month, the F-series accounted for 21 percent of Ford's sales.
Dealers say the only people still buying trucks in large numbers are those who need them for work, like building contractors.
"You aren't going to have the guys who get them as a macho thing anymore," said John Hutchinson, a salesman at Northpoint Ford in Milwaukee.

Ford Motor to cut salaried pay costs by 15 pct as it deals with shrinking US auto market
DETROIT: A top Ford Motor Co. executive told North American white-collar workers Thursday the company wants to cut its salaried work force costs by 15 percent, and some people will lose their jobs.
Mark Fields, president of Ford's Americas division, said in an e-mail message sent to workers the cuts will take place by Aug. 1.
"This unfortunately will result in involuntary separations of Ford employees and agency personnel as well as cost savings through attrition and the consolidation of open positions," Fields said in the message.

Continental becomes latest U.S. airline to cut service
DETROIT: Continental Airlines said Thursday that it would cut 3,000 jobs and retire 67 Boeing aircraft from its fleet, becoming the latest airline to announce capacity reductions in the face of high prices for jet fuel.
Continental's announcement came a day after United Airlines said it was discontinuing Ted, its low-fare airline, cutting 1,100 more jobs on top of previously announced cuts and retiring a total of 100 aircraft. Delta Air Lines and American Airlines have announced similar steps.
Continental's fleet reduction, which equals a 16 percent reduction in its capacity, had been rumored in industry circles Wednesday. The details came in a message to employees from Continental's chief executive, Lawrence Kellner, and its president, Jeffrey Smisek. The airline, based in Houston, said Kellner and Smisek would not accept their salaries for the rest of 2008.
"The airline industry is in a crisis," the two executives said in the message to employees. "Its business model doesn't work with the current price of fuel and the existing level of capacity in the marketplace. We need to make changes in response."

One-obscure Baltic Exchange has become hot with investors
A small group of ship brokers on an obscure exchange in London determines the cost of ferrying goods across the oceans. These days, the price is going through the roof.
Investors around the world are betting - and betting big - on what happens on the tiny Baltic Exchange.
Thanks to China's unquenchable thirst for raw materials, a resulting acute shortage of ships has pushed up freight rates and brought the freight index compiled by the London-based Baltic Exchange to the attention of investment banks and hedge funds, eager to buy derivatives based on the sky-high index.
The Baltic Exchange index for dry freight, which measures the cost for shipping goods like iron ore and grains, doubled over the past 12 months and has risen more than fourfold since 2006. As demand rose, so did the price of ships, eventually making dry freight vessels, a relatively simple boat to build, more expensive than oil tankers.

John Luke, head of shipping at KPMG in London, said shipping rates might come down if China's growth slows, too many ships flood the market or a recession in the United States leads to lower Chinese exports. But "even if rates come down by 50 percent, they would still be at a historical high, and at the moment there is little if not nothing to indicate that even that would happen," he said.

Solar deals are delayed by a shortage in silicon
ZURICH: Record high oil prices offer a golden opportunity for the solar industry, but analysts say long-awaited takeovers could be delayed before an expected jump in silicon supply that will affect prices and valuations.
Growth in the industry has been capped by a shortage in solar-grade silicon, which the industry expects to ease next year as suppliers lift production.
Semiconductor makers like Samsung Electronics and engineering companies like General Electric and Siemens are among those seen as possible investors in the sector as renewable energy becomes unavoidable.
Silicon-based technology for solar is not a huge leap for chip makers, and the sector's stellar growth prospects make it especially attractive as demand in other chip sectors slows.
Applied Materials, the world's top supplier of chip-making equipment, now supplies the solar industry, while Qimonda, a memory-chip unit of Infineon, has teamed up with Centrosolar to build a solar cell plant.
"What you will see in the years ahead is that semiconductor companies will do a lot of takeovers, at least in the field of process technologies," said Thiemo Lang, senior portfolio manager at Sustainable Asset Management in Zurich.

Saying farewell to a fashion icon

Betty Catroux, with her slim, boyish figure the mirror image of her friend Yves, sat among the family - Saint Laurent's 95-year-old mother, Lucienne, who walked stoutly down the aisle on her cane, supported by her daughters. Loulou de la Falaise, the free Bohemian spirit who was the creative counterpoint to Catroux's masculine rigor, hid under a chic black hat, while the actress Arielle Dombasle made her entrance with a giant Jackie Kennedy-style pill box.
Designers paying homage were led by the distinguished, white-haired Hubert de Givenchy, who said tearfully: "We are all here for him."

Marc Jacobs, who had flown overnight from New York, said simply: "He's the person who taught me everything I know."


The blooming of red Burgundy wines

POMMARD, France:

Rain is the farmer's blessing, when it comes at the right time and in the right amount. But when the ground is saturated and the air is warm, the resulting moisture and humidity is a curse that can threaten the grapes with mildew and rot.
In past decades such weather might have spelled doom for the year's vintage. But nowadays it means something else entirely. "It means more work for us," said Benjamin Leroux, 33, the manager of Comte Armand, one of the best producers in Pommard in the Côte de Beaune, the southern half of the Côte d'Or. "All the things we're doing in the vineyard right now, we're insuring the vintage."
Twenty years ago nobody could have predicted that Burgundy could be trusted to produce reliably good wines in tricky vintages. As captivating as the great wines of Burgundy could be at their heights, too often they revealed their depths - diluted, overly acidic wines that seemed to vary not just vintage to vintage but almost bottle to bottle. The only thing consistent about the region was its inconsistency.
In fact, the quality of Burgundy - red Burgundy in particular - has risen strikingly over the last two decades. From the smallest growers to the biggest houses, the standards of grape-growing and winemaking have surpassed anybody's expectations. These days, Burgundy has very few bad vintages, and among good producers, surprisingly few bad wines.

"It's not so much an improvement as a blooming," said Becky Wasserman, an American wine broker who has lived in Burgundy since 1968. "It's a realization of potential."

Most striking of all was the number of young producers making superb wines, whether they have taken charge of their family domains or started out new. In Marsannay, perhaps the least-esteemed commune in the Côtes de Nuits, the northern half of the Côte d'Or, Sylvain Pataille, 33, is turning out excellent reds, whites and rosés. In the Hautes-Côtes de Nuits, once a backwater in the hills, David Duband, 37, is producing light, fresh regional wines from his ancestral vineyards, along with a series of more ambitious, elegant reds from grand cru vineyards like Echézeaux and Charmes-Chambertin.
Louis-Michel Liger-Belair, 35, in Vosnes-Romanée has reclaimed some of the greatest vineyard property in the north, which his family had leased out for years, and is making wines of purity and depth.
In Meursault in the south, Arnaud Ente, who took over his father-in-law's vineyards in the 1990s, is turning out small amounts of whites of focus and clarity that show tremendous minerality. Pierre-Yves Colin-Morey, 36, left his father's domain, Marc Colin et Fils, and set up shop in Chassagne-Montrachet, where he is making light yet intense, mouthwatering whites.

ECB warns it might raise interest rates

FRANKFURT: The European Central Bank, alarmed by the soaring price of food and fuel, warned unexpectedly Thursday that it might raise interest rates next month to counter an inflationary spiral.

Declaring the bank to be in a "heightened state of alertness," its president, Jean-Claude Trichet, said the risks to price stability had increased, and that the bank's governing council debated lifting the key rate at its meeting this week, before voting to leave it at 4 percent for now.

"They've set in motion a process that pushes the odds toward a hike in July," said Thomas Mayer, the chief European economist at Deutsche Bank in London. "The hawks scored a goal today."


Some rich UBS clients risk tax fraud exposure

Under pressure from the authorities, UBS is considering whether to divulge the names of 20,000 of its well-heeled U.S. clients, according to people close to the probe, a step that would have once been unthinkable to Swiss bankers, whose practice of secrecy dates back to the Middle Ages.
U.S. investigators believe some of these clients may have used offshore accounts at UBS to illegally hide as much as $20 billion from the Internal Revenue Service. Doing so may have enabled these people to dodge $300 million or more in U.S. taxes, according to a government official connected with the investigation.

One prominent UBS client, a wealthy California property developer named Igor Olenicoff, has already pleaded guilty to filing a false 2002 tax return. But as the investigation tears holes in the veil of secrecy surrounding tax havens like Switzerland and Liechtenstein, other names are surfacing, according to the authorities.
New revelations are likely to come Monday, when a former UBS banker is expected to testify in a Florida court about how he helped Olenicoff and other clients evade taxes. The former banker, Bradley Birkenfeld, is set to plead guilty to helping Olenicoff conceal $200 million.
UBS said it was cooperating with investigators and that it was against policy to help Americans evade taxes. Officials at the bank declined to comment for this story.

Chinese disaster relief proves swift, and inclusive
DUJIANGYAN, China: America's presumed Republican candidate for the presidency delivered an intriguing line about disaster relief in a campaign speech.
"We must also prepare, far better than we have, to respond quickly and effectively to a natural calamity," Senator John McCain said Wednesday. "When Americans confront a catastrophe they have a right to expect basic competence from their government."
As someone who has spent several days touring China's earthquake zone in recent weeks, I have seen the kind of future McCain was talking about, and it works.
In an aside that has lastingly stained her reputation, France's first woman prime minister spoke in the early '90s of the Japanese as "yellow ants trying to take over the world." Subsequent explanations by the prime minister, Édith Cresson, didn't help matters. With its racist overtones, her complaint centered on the idea that the West faced unfair competition from an Asian nation where collective discipline and action and the cohesiveness of groups was more important that the needs of the individual.
Rank stereotypes aside, China's response to the earthquake has many aspects of the very qualities that Cresson, with all of her oversimplification and misunderstanding, sought to criticize.
Drive on the highways in this part of Sichuan Province in the early morning or at nightfall and you are likely to come across immense convoys of trucks, filled with supplies on their way to badly stricken cities like this one, or on their way back home for resupply.

A cruel sequel to a cruel blow
Tony Banbury is the Asia regional director of the United Nations World Food Program.

AYA, Myanmar:
The woman was frail and looked to be about 80, although like many people who have toiled all their lives in rice paddies she may have looked older than her years.
She approached me and moved her hand to her mouth three or four times, the sign for eating. Aya is one of the fingertips of the Ayerwaddy Delta where it juts into the Bay of Bengal, and she needed food.
More than three weeks had passed since Cyclone Nargis whipped through southern Myanmar, leaving death, destruction, misery and overwhelming human needs in its wake. Coming face to face with that woman in those circumstances, I felt the same way most people in the world would - I had an overwhelming desire, even a need, to try to help.
No one has good numbers, but it is estimated that Cyclone Nargis killed about 120,000 people and left about 2.5 million needing some form of assistance. For comparison, the Indian Ocean tsunami in December 2004 killed about 190,000 and left more than 3 million needing help in six countries.

Nature had dealt the people of the Ayerwaddy Delta a cruel blow. Would mankind deal them another?



Doomed to fail?

Morton H. Halperin is U.S. advocacy director for the Open Society Institute. Ted Piccone is senior fellow and deputy director for foreign policy at The Brookings Institution.

Senator John McCain proposes to create a League of Democracies that would unite the world's democracies around a common mission: to work together "in the cause of peace." As two former Clinton administration officials responsible for launching a similar but more modest experiment called the Community of Democracies, we couldn't disagree more with the timing and substance of McCain's approach.
In our view, McCain's vision of a common organization devoted to everything from relieving human suffering in Darfur to tackling our environmental crisis and sanctioning Iran is rooted in the past and doomed to failure. It revives a Cold War mentality that pits the good guys (market democracies) against the bad (autocracies). It wrongly assumes that democracies have common interests across a whole host of disparate issues simply because of their common form of political system. This view is not only naïve - it is dangerous.
America's security lies in fostering an international order that whenever possible engages all states in a common pursuit to confront our most pressing global challenges.

The UN Democracy Caucus has been largely missing in action, outmaneuvered repeatedly by other like-minded groups (including some democracies) intent on undermining international scrutiny of human rights. It suffers from a lack of attention and resources, particularly from more established democracies like those in Europe and Japan.
This sorry state of affairs is the result of two main factors. First, it turns out that certain key democracies like India, South Africa, and the Philippines show no desire to break ranks with their domestic constituencies and allies abroad who value protection of national sovereignty and economic relations over respect for democratic norms. More importantly, even our closest allies block any serious progress toward strengthening the Community of Democracies. They view it, incorrectly, as a U.S. plot to undermine and ultimately eliminate the UN. The Bush administration's disastrous attempts to promote democracy through military invasion in Iraq and regime change in Iran, Cuba and elsewhere have given yet more fodder to the naysayers intent on blocking any initiative made in Washington.
It is hard to imagine how such a global NATO on steroids suggested by McCain could get off the ground. Why would such diverse countries as India, Brazil, Nigeria, South Africa, Turkey, Mexico, Indonesia and Japan, critical to any functioning League of Democracies, join a new organization in which their interests were not aligned and which would inevitably create major tensions with some of their closest partners?
In the current challenging environment for U.S. leadership in the world, McCain's proposal to convene a summit meeting of the world's democracies to tackle every issue under the sun is simply dead on arrival.
A better scenario would be for Portugal, the current chair of the Community of Democracies, to convene a summit meeting in Lisbon to reinvigorate the group around such issues as economic incentives for developing democracies, responding to threats to democracy and cooperation to confront terrorism in ways that respect human rights.
Before going any further with this bad idea, our next president's advisers ought to ask themselves: What if the United States threw a party only for democracies, and no one showed up?


U.S. and British diplomats are detained in Zimbabwe

JOHANNESBURG: A contingent of American diplomats investigating the political situation in Zimbabwe was chased by the police in their car Thursday, stopped at a roadblock and detained, American officials said.
The diplomats were released from custody after five hours, according to the U.S. ambassador to Zimbabwe, William McGee. A team of British diplomats was also detained and released along with the Americans.
During a car chase of about 10 kilometers, or six miles, the police tried to force the American diplomats off the road. When the diplomats were finally stopped, all four tires of their white SUV were slashed and a local security official was punched.
The diplomats were part of a convoy of three vehicles from the U.S. and British Embassies in Harare, the capital. The diplomats were at a town about 90 kilometers north of Harare. They were talking to activists belonging to the Movement for Democratic Change, the main opposition party, and to victims of political violence when they were approached by police officers and ordered to a nearby police station.

Qaeda operative takes responsibility for blast near Danish embassy


The statement claiming responsibility for the embassy attack included a quote from that audio message: "If there is no check on your freedom of words, then let your hearts be open to the freedom of our actions."
The posting said more acts would follow unless Denmark apologized for the cartoons. It also said the will of the Islamabad suicide bomber would be published soon.

Syria to limit UN nuclear inspectors' access

VIENNA, Austria: Syria told a 35-nation meeting Thursday that it will limit what U.N. nuclear inspectors can see when they investigate allegations that Damascus has a hidden atomic program, diplomats said.

Syria denies any hidden nuclear activities and Othman said as much again Thursday, they said, suggesting Syria's willingness to allow a visit to the remote Al Kibar site should not be exploited with attempts to extend the probe to what he said were other non-nuclear facilities.
The diplomats also said he warned against using the inspections as a pretext to increase political pressure on his country and condemned Israel for its September attack.
The U.S. criticized the Syrian stance.
"Syrian authorities should let inspectors go wherever they think they have to go," said Gregory L. Schulte, the chief U.S. delegate to the IAEA.
"We hope that the Syrian authorities will give their full cooperation to this investigation and not try to put any limits on it," he told reporters.
The European Union, in a statement to the meeting, expressed its concerns about Syria's alleged nuclear cover-up and also urged full cooperation with the IAEA.


Spanish judge charges 11 with plotting suicide attack in Barcelona
MADRID, Spain: A Spanish judge charged 11 suspected Islamic extremists Thursday with plotting suicide attacks against the public transport network in Barcelona.
The indictment says the cell had planned to carry out several bombings in Spain's second-largest city in January of this year.
The suspects are nine Pakistanis, one Indian and one whose nationality was not given.
In the indictment, Judge Ismael Moreno of the National Court charged the men with belonging to a terrorist organization and/or possessing explosives.
Ten of the suspects were arrested Jan. 19 in the Raval neighborhood of Barcelona, which has a large Pakistani community. One of the indicted men remains at large, and the judge issued an international warrant for his arrest.

A raunchy best seller gets Germans talking

TEGERNHEIM, Germany: Not many literary readings are restricted to an over-18 audience. Fewer still take place under circus tents. Yet nothing could be more appropriate for the scandalous German best seller "Wetlands," by the television personality and author Charlotte Roche.

The book, which will be published next year in the United States, is a headlong dash through every crevice and byproduct, physical and psychological, of its narrator's body and mind. It is difficult to overstate the raunchiness of the novel, and hard to describe in a family newspaper. If you are reading this over breakfast, stop eating for a moment.
"Wetlands" opens in a hospital room after an intimate shaving accident with a detailed topography of Helen's hemorrhoids, continues into the subject of anal intercourse and only gains momentum from there, eventually reaching avocado pits as objects of female sexual satisfaction and - here is where the debate kicks in - just possibly female empowerment.
The subject has struck a nerve here, catching a wave of popular interest in renewing the debate over women's roles and image in society.

"It's not feminist in a political sense, but instead feminism of the body, that has to do with anxiety and repression and the fear that you stink, and this for me is clearly feminist, that one builds confidence with your own body," Roche, the mother of a young daughter who is more serious in person than onstage, said last week in an interview after her reading here.
Roche's critics say that it is just a modern spin on not shaving your legs, this time for the genital-waxing generation. Meanwhile, sex sells, and always grabs the spotlight. As a result, a debate that might more profitably center on career counselors and day-care beds is instead mired in old questions about sexual liberation.
With this in mind, critics have asked what practical help a book like "Wetlands" could offer, and even whether by hyper-sexualizing the main character it represents an all-too-familiar commercial ploy rather than a step forward.

"When a woman breaks a taboo, it is automatically incorporated into the feminism debate, whether it really belongs there or not," said Ingrid Kolb, a German writer and longtime feminist.

"Wetlands" is something different. It is far more anatomical and scatological than erotic. In the interview, Roche said that she wrote scenes specifically to build up arousal, only to bury them again in the repulsive. Lost in the whole hubbub is also a very sad story about a young woman who has undergone family traumas, the emotional core of the novel.


Turkey's high court overrules government on head scarves


The 9-to-2 decision by Turkey's Constitutional Court sets the stage for a final showdown between Turkey's secular elite - its military, judiciary and secular political party - and Erdogan, a devout Muslim with an Islamist past.

Despite Erdogan's broad popularity - his party won 47 percent in an election last July - the threat of closure is serious: The authorities have closed more than 20 parties in the past. The head scarf amendment is considered to be the single most important irritant that set off the closure case, and is central to its argument that Erdogan and his allies are trying to dismantle secularism in Turkey, a charge they strongly dispute.
Many secular Turks are skeptical that Erdogan, whose past is in political Islam, will defend secularism in the future, even though Erdogan frequently reassures them that he will.
"There is still a group within the AKP that is remembered for their Islamic past," said Ersin Kalaycioglu, a political science professor at Sabanci University. "Fears don't need to be rational," he said, arguing that the party should not dismiss them.
But Dengir Firat, a senior member of Erdogan's party, disagreed.
"You can't limit someone's liberties on the basis of people's fears," Firat said.


Cubans' main concern is economy, study shows

MEXICO CITY: A rare study conducted surreptitiously in Cuba found that more than half of those interviewed considered their economic troubles to be their chief concern while fewer than 10 percent listed lack of political freedom as the main problem facing the country.
"Almost every poll you ever see, even those in the U.S., goes to bread-and-butter issues," said Alex Sutton, director of Latin American and Caribbean programs at the International Republican Institute, which conducted the study. "Everybody everywhere is interested in their purchasing power."
The results showed deep anxiety about the state of the country, with 35 percent of respondents saying things were "so-so" and 47 percent saying they were going "badly" or "very badly." As for the government's ability to turn things around, Cubans were skeptical, with 70 percent of those interviewed saying they did not believe that the authorities would resolve the country's biggest problem in the next few years.


Iran and Turkey coordinate strikes in Iraq

ANKARA, Turkey: Turkey and Iran have been carrying out coordinated strikes on Kurdish rebels based in northern Iraq, a top Turkish general said Thursday in the first military confirmation of Iranian-Turkish cooperation in the fight against separatists there.
Gen. Ilker Basbug, Turkey's land forces commander, said the two countries have been sharing intelligence and planned more coordinated attacks in the future against the Kurdistan Workers' Party, or PKK, and PEJAK, the group's Iranian wing.

Medvedev, in Germany, revisits Russia's tensions with West

"I won't hide the fact that we are concerned by the tendency toward a narrowing of our mutual understanding within Euro-Atlantic politics," Medvedev said after a two-hour meeting with Chancellor Angela Merkel, a fluent Russian speaker raised in communist East Germany who continually criticized Putin's clamp down on human rights and media freedom.
Addressing a German-Russian economic forum, Medvedev reiterated his criticism of NATO's plan to offer eventual membership to Ukraine and Georgia, both former Soviet republics.

But in a sign of the heavy investment in Russia by German business, Medvedev nonetheless received a rapturous welcome from the 1,500 audience members packed into a large hotel ballroom.

Many African-Americans see a tipping point in Obama's victory

Kwabena Sam-Brew, a 38-year-old immigrant from Ghana, doubted that Nana, his 5-year-old American-born daughter, would remember the rally that effectively crowned Senator Barack Obama as the Democratic nominee Tuesday night. But Sam-Brew said he would describe it to her:
"I will tell her, 'Tonight is the night that all Americans became one."'

Sam-Brew, a bus driver living in Cottage Grove, Minnesota, said Obama's achievement would change the nation's image around the world, and change the mind-set of Americans, too.
"We as black people now have hope that we have never, ever had," Sam-Brew said. "I have new goals for my little girl. She can't give me any excuses because she's black."


Choice of running mate is Obama's alone, Clinton says

BRISTOL, Virginia:

"I know I'm a better candidate because I ran against her," Obama said, speaking over the applause of several hundred supporters. "She's tough. She is just an outstanding candidate, and a great public servant."


Ally of Obama is found guilty on fraud charges


CHICAGO: A prominent fundraiser for Sen. Barack Obama and Gov. Rod Blagojevich was convicted Wednesday of fraud and money laundering after a high-profile federal trial provided an unusually detailed glimpse of the pay-to-play politics that has made Illinois infamous.
Antoin "Tony" Rezko showed no emotion as the jury found him guilty of 16 of 24 counts, including scheming to get kickbacks from money management firms seeking state business and a contractor who wanted to build a hospital in northern Illinois. He was acquitted of charges that included attempted extortion.
"What the jury did was vindicate the interests of the citizens of Illinois and honest government," U.S. Attorney Patrick Fitzgerald said.
The nine-week trial included explosive testimony about drug-fueled parties involving the government's star witness and allegations that the governor discussed a state job for a donor after the donor handed over a $25,000 check for Blagojevich's campaign.
Testimony barely touched on the relationship between Obama and Rezko, who has known the Democratic presidential candidate since he entered politics and was involved in a 2005 real estate deal with him.



A turning point for America
Regarding the article "Obama takes next step on 'historic journey' (June 5): Growing up in segregated Oklahoma during the 1950s and '60s, I can still remember the many places that black Americans could not enter, including most restaurants, country clubs, hotels and motels, and even lavatories at gas stations, which had separate facilities for white and "colored."
With the nomination of Barack Obama by the Democrats, America may finally reach a significant turning point.
There are still many racial problems to overcome, especially in rural areas. But should Obama be elected president in November, the situation of all minorities, as well as mainstream white Americans, will be improved during his presidency. Obama appears to be very interested in issues like education, health care and other social and economic issues that have simply been pushed aside by other administrations.
Maurice Picow, Atlanta


EU nations agree on guidelines to expel illegal migrants
LUXEMBOURG: European Union nations agreed Thursday on common rules for expelling illegal immigrants, ensuring basic rights including access to food, shelter and legal advice.The rules say illegal immigrants in the 27 member countries can no longer be detained for more than 18 months before deportation to their home nations, and unaccompanied children cannot be expelled.The agreement took three years to craft, with some government and lawmakers claiming granting immigrants those rights would be too expensive.
"This will make the return of those that we want to get rid of easier," said Peter Altmaier, German deputy interior minister. He said a key element of the new rules would ensure that "a re-entry ban issued in one member state will in the future automatically apply in the entire EU."

Rose Tremain wins book prize for fiction by women
LONDON: English writer Rose Tremain won Britain's Orange Prize for fiction by women Wednesday with a novel about an Eastern European migrant in Britain."The Road Home" is Tremain's 10th novel and follows the character of Lev, who arrives in Britain with no English and little money.Kirsty Lang, the judges' chair, said the novel was a "fantastic exercise in empathy.""She succeeded in putting herself in the head of an Eastern European migrant in contemporary Britain. She managed to tell the story in a very powerful way. It's a male character ... in his 40s. She absolutely gets inside his head," she said.

Time Asia and International Herald Tribune top publishing society's awards list

HONG KONG: Time Asia and the International Herald Tribune won the most prizes for editorial excellence this year from the Society of Publishers in Asia in the category for large regional publications.
In an awards ceremony Wednesday evening, Time Asia took a total of eight prizes - five top awards and three honorable mentions. Among the awards announced, the weekly newsmagazine was recognized for its coverage of breaking news and news photography in Myanmar.
The IHT, the global edition of The New York Times, won a total of seven prizes - three top awards and four honorable mentions. The IHT's awards included human rights reporting from Myanmar and environmental reporting about China. The Financial Times won six prizes, and The Asian Wall Street Journal won four.

Russians discover the joys of the new dacha
In boomtown Moscow, the ever-rising price of oil is also fueling some exuberant property prices. "There is a strong correlation between oil prices and those of Moscow apartments, private homes and also Russian art," said James Brooke, a director at Jones Lang LaSalle real estate in Moscow.As those prices have gone up, so have the numbers of gated communities popping up among the pines and birches along new highways linking the city to the countryside."It's an outgrowth of the dacha culture," said Brooke, likening Moscow's scene to New York. "There is a huge demand for parking the family outside town, the way people do in the Hamptons and Berkshires, and coming out for weekends for summer or year-round living."
For the most chic fresh-air destinations, Muscovites have headed west. "The prevailing winds go from west to east, and even in Czarist and Soviet days they put a lot of air polluting factories in the east," Brooke explained. "The western suburbs of Rublyovka and Novorizhskoe are the Hamptons of Moscow, very expensive, very desirable."Known as Moscow's billionaire suburb, Rublyovka is home to President Dmitri Medvedev and his predecessor, now prime minister, Vladimir Putin, as well as the ultra-upscale shopping center Barvikha Luxury Village.


Steaua Bucharest in trouble
Steaua Bucharest has been docked seven points in the final standings of the Romanian league after a bribery scandal, The Associated Press reported Thursday.
Steaua was penalized late Wednesday by the Romanian football federation after prosecutors started an investigation for match-fixing. Steaua owner Gigi Becali is accused of offering $2.6 million to another team to fix the last match of the Romanian league and help Steaua win the title.
Steaua ended up in second place behind CFR Cluj, and the penalty does not affect its final placing in the standings. However, the club could be excluded from European competition next season. FC Porto was banned from next season's Champions League by UEFA on Wednesday after a similar bribery scandal dating back to 2004. Steaua is set to play in the third preliminary round of the Champions League.

Poland coach apologizes as media go into overdrive

TENERO, Switzerland: The Poland coach, Leo Beenhakker, apologized Thursday after a newspaper printed a doctored photo of him holding the chopped-off heads of Germany's coach and captain ahead of the match Sunday between the two teams at the European Championship.
Some Polish tabloids played Wednesday on the troubled history between the two neighbors in their buildups to the Euro 2008 game, with one running a manipulated picture of Beenhakker holding the dismembered heads of Germany's coach, Joachim Löw, and its captain, Michael Ballack.
Beenhakker, who is Dutch, issued an apology to the German people on behalf of his team for an "awful thing" by "weird and dirty and sick people."


A headache for Eto'o
Samuel Eto'o, a three-time African player of the year, issued a public apology on Cameroon television after head-butting a journalist at a news conference last week, Reuters reported from Yaoundé, Cameroon on Thursday.
The Barcelona striker also offered to pay the medical expenses of radio reporter Philippe Bonney, whose nose was allegedly broken in the altercation. Eto'o said he had a met Bonney and apologized to him.
Bonney said last weekend he would file a lawsuit against Eto'o. The fracas took place when Cameroonian journalists decided to walk out of a news conference ahead of the World Cup qualifier against Cape Verde Islands to protest at the team's refusal to grant interviews to local reporters.


From Swiss: Behave, please

The Swiss police have been writing to suspected football hooligans asking them kindly to refrain from violence at Euro 2008, which is being staged this month in Switzerland and Austria, The Associated Press reported from Liestal, Switzerland on Thursday.
"We know you to be a person who hasn't always stuck to the rules at sporting events," explains the letter sent to some 60 known troublemakers, before ending: "We hope that any encounter between you and us at this event will be nothing but pleasant. If you have any questions about this matter, please contact us. The Police."
The letters were sent out two weeks ago to people known to have repeatedly caused problems at past matches, said Meinrad Stoecklin, a spokesman for Basel-Country cantonal (state) police, on Thursday.
About 320 people are registered on Switzerland's federal hooligan database. A further 6,000 foreigners are recorded as "risky fans," but the federal police declined to say how many of those would be automatically deported if they come to Switzerland.
For those foreigners who do misbehave, the authorities have turned part of Geneva's giant convention center into a holding prison.
The Swiss Army built 48 wooden cells - each able to hold four detainees - and put them in Palexpo Center, the convention hall famous for hosting the International Geneva Motor Show.
"They need to do something wrong to get in," a police spokesman, Jean-Philippe Brandt, said Thursday.

Briton steps down in European Parliament
Acknowledging he had broken the rules by channeling official money though a family firm, the senior British Conservative in the European Parliament stepped down Thursday, dealing a new blow to the reputation of the EU lawmaking assembly.
The lawmaker, Giles Chichester, apologized for his breach of parliamentary rules but insisted that the £445,000, or $870,000, paid to the firm since 1994 - and intended to finance his European Parliament office - had been spent legitimately.
The resignation is also a blow to the prestige of Britain's Conservative Party. Chichester had been asked by the party leader in London, David Cameron, to ensure that lawmakers were obeying the rules of the Parliament in Strasbourg.
That directive followed a scandal in London in which a Conservative member of the British Parliament, Derek Conway, was reprimanded for paying his student son more than £40,000 as a House of Commons researcher.


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