Friday, 18 July 2008

Thursday, 17th July 2008


Sunflower seeds are commonly used to make sunflower seed oil and meal, the prices of which are up 150% and 102%, respectively. These goods are in heavy demand from the food processing industry. Bad sunflower crops in the European Union, Russia and Ukraine contributed to the prices. [Picture caption]

The world's most expensive food

By Joshua Zumbrun
In the chair's summary of the last G-8 conference in Heiligendamm, Germany, there was no mention of food prices or agriculture.

In Pictures: The world's most expensive food
What a difference a year makes.
Since the G-8 last assembled in June 2007, food prices have reached unprecedented heights, threatening to push millions into poverty.
Earlier this month, the general director of the United Nations' Food and Agriculture Organization (FAO), Jacques Diouf, said the rising prices of basic foodstuffs have added 50 million additional people to the ranks of the hungry. And World Bank President Robert Zoellick has estimated that the surging prices could push 100 million more people deeper into poverty.
Aid organizations are strapped for cash. Soaring prices forced the U.N's World Food Program, based in Rome, to embark on a massive fund-raising campaign to combat what executive director Josette Sheeran called a "silent tsunami" - a global crisis that, in some fashion, will strike every nation.

Overall, countries like Bangladesh, Ethiopia and Haiti, which import most of their food, stand to hurt the most. And in the poorest countries, the rising prices are causing hardship for farmers, whose production volumes are simply too small to reap a windfall.
One long-term solution is improving agriculture in the developing world so that more countries can one day feed themselves. In fact, 2008 has been dubbed the International Year of the Potato as part of an effort to boost production of the tuber globally. Potatoes are high energy and easy to grow, and experts consider them a good crop for food security because they are not widely traded. But potatoes can only do so much so fast; for many countries, harvests that fill the national stomach are still years away. Nobody expected food prices to rise so high so quickly.
"It caught the world by surprise, to be honest," says Nancy Roman, the director of communications and public policy for the World Food Program. "We were early in identifying rising food prices as a problem, and that was last summer, before this was on the front pages everywhere. But we didn't anticipate just how far this would go."
By all accounts, it's gone too far. The World Bank estimates that 41 countries have suffered losses of between 3% and 10% of their gross domestic product because they've been hammered by soaring prices of food and fuel. More than 30 countries have experienced rioting over food shortages, according to the World Bank.
The humanitarian need to ease the crisis is obvious; people shouldn't be starving. Perhaps less obvious is the global economic threat: Stagnant or collapsing growth in the developing world combined with political instability has the potential to drag down growth everywhere.
People living on a dollar a day are likely spending almost their entire income on food. If the prices double, the amount of food they can afford is halved.
To measure the world's most expensive food, we looked at data from the U.N. Food and Agriculture Organization (FAO). Rather than look at the most expensive food in absolute terms - of course, Beluga caviar and hippopotamus steaks are more expensive than rice - we looked at everyday commodities whose prices have soared the most in the last year. The average family's grocery bill is expanding because of these goods, like rice and butter.
Using information from the commodity prices database maintained by the Commodities and Trade Division of the FAO, we averaged the price of various commodities from January 2008 to April 2008 (the most recent month for which data were available on a wide range of food items) and compared these figures with prices during the same period one year ago.
Some commodities have peaked, and their prices seem to be easing. The costs of rice and wheat, which had nearly doubled, have slacked some. But they are still dramatically higher than a year ago. Some crops, like corn and the grain sorghum, continue to climb.
Prices for food can be highly inter-related. Increased demand for corn, largely driven by production of ethanol as an alternative fuel to gasoline, has caused American farmers to plant less soybeans in favor of corn fields. But fewer soybean fields mean less soy oil, driving up not only the price of soybeans but also other oilseeds.
Using this data, we found that sunflower seeds and its products have experienced the most dramatic increase in prices--up nearly 150% from last year.
Behind the price increases, one sees a perfect storm of factors fueling the "silent tsunami": unexpected bad weather, from floods to droughts, pillaged fields across the world; soaring oil prices lifted costs of producing and transporting the crops; prices rose along with demand from both an ever-growing global population and a rapidly expanding American ethanol industry; and as global prices soared, a number of countries implemented beggar-thy-neighbor export curbs, driving up prices even further.
Global leaders cannot do much about the weather. But the remaining factors in the food crisis are manmade. Heads of state have the ability, and the forum, to address the problems. The question is - do they have the will?


Argentina blocks farm export tax


U.S. food agency lifts Salmonella warning on tomatoes


World food crisis drives up U.N. aid funding need

UNITED NATIONS: The global food crisis is largely responsible for driving up the United Nations' need for funding to confront disasters and emergencies around the world this year by one-fifth, the U.N. said on Wednesday.
World prices of basic foodstuffs such as wheat and rice have doubled over the last year, badly hitting poor nations that rely on food imports and sparking food riots in Africa and elsewhere.
A mid-year review meeting to assess U.N. aid funding needs for 2008 heard that the original appeal for $3.8 billion (1.9 billion pounds) announced in December and quickly revised to $5.4 billion to accommodate extra crises now stood at $6.5 billion.
The cash is needed to meet appeals for food, shelter, clean water and other necessities in 10 countries, mainly in Africa, plus the west African region.
"One of the main reasons for the rises is because of the global food crisis," U.N. humanitarian chief John Holmes told a news conference, although he said natural disasters and conflicts were also to blame.

So far this year donors have contributed $2.9 billion, meaning another $3.6 billion is needed if the revised target is to be met. "The donors will need to dig deep into their pockets to try to find that money," Holmes said.
The biggest focus of the appeal is Sudan, where the 5-year-old conflict in the western Darfur region has driven an estimated 2.5 million people from their homes. The new funding requirement for Sudan is $1.95 billion.
However, the biggest percentage increase is for Somalia, where continued internal fighting has combined with drought to make many more people destitute. The aid requirement there has jumped nearly 60 percent in six months to $641 million.
Other needy countries are the conflict-ridden Democratic Republic of the Congo, now requiring $736 million this year, cyclone-hit Myanmar ($481 million) and Zimbabwe, struck by political, economic and weather-related crises ($394 million).
The biggest supporters of U.N. aid projects have in the past been the United States and the European Union, but Holmes, underlining a point he made at the original launch, stressed the need for new donors, including from the private sector.

Pope makes a plea for the environment

SYDNEY: Pope Benedict XVI used his first major address at the Roman Catholic Church's youth festival on Thursday to warn that the world was being scarred and its natural resources used up by humanity's "insatiable consumption."
In a broad criticism of consumer culture, before a crowd of more than 140,000 on a dock in Sydney harbor, Benedict reinforced the Vatican's growing concern with protecting the environment, a theme he has addressed before.
"Perhaps reluctantly we come to acknowledge that there are also scars which mark the surface of our earth: erosion, deforestation, the squandering of the world's mineral and ocean resources in order to fuel an insatiable consumption," he said.
The pope also criticized television and the Internet for treating violence and sexual exploitation as entertainment, as he laid out an agenda for the festival focusing on social justice and the environment, and attacked moral relativism.
The Vatican has increasingly spoken out about the environment and the pope has raised his concerns about the emptiness of secularism in messages that seem tailored specifically for young audiences.


Gore asks U.S. to abandon fossil fuels

WASHINGTON: Al Gore, who shared the Nobel Peace Prize for his effort against global warming, said Thursday that Americans should rely on the sun, winds and other environmentally friendly sources of electricity, or risk their national security as well as their creature comforts.
"The survival of the United States of America as we know it is at risk," Gore said in a speech during an energy conference in Washington. "The future of human civilization is at stake."
Gore, who was Bill Clinton's vice president, called for the kind of concerted national effort that enabled Americans to walk on the moon almost 39 years ago, just eight years after President John F. Kennedy famously embraced that goal.
Gore said that producing all electricity in the United States from "renewable energy and truly clean, carbon-free sources" within 10 years was not a farfetched vision, although he acknowledged it would require fundamental changes in political thinking and personal expectations.
"This goal is achievable, affordable and transformative," Gore said in remarks prepared for the conference. "It represents a challenge to all Americans, in every walk of life - to our political leaders, entrepreneurs, innovators, engineers, and to every citizen."


Pelosi stands firm against offshore drilling

Czechs dealing with Russian oil cutback

BERLIN: With Russia cutting oil deliveries to the Czech Republic, a strategic decision made by Prague in the early 1990s to reduce its energy dependence on Moscow appears to be paying off.
The Czech Republic was the only former communist country in the region to diversify energy sources immediately after the fall of the Soviet Union, and it seemed unfazed this week by the Russian decision to cut oil deliveries by about 40 percent.
"We are managing quite well," said Tomas Bartovsky, spokesman for the Trade and Industry Ministry. "We have alternative sources of supplies."
Russia, without warning, stopped sending up to 7,000 tons of oil a day via the Druzba, or Friendship, pipeline last week. That pipeline is controlled by the Russian state-owned company, Transneft. Russia sends annually about 5.5 million tons of oil via the Druzba pipeline to the Czech Republic.
The reductions started July 8, when Secretary of State Condoleezza Rice and her Czech counterpart, Karl Schwarzenberg, signed an accord to allow the Pentagon to base part of its anti-ballistic missile shield in the Czech Republic.


Car buyers downsize, but spend big on options


Balancing energy prices and the yuan

HONG KONG: When Beijing relaxes the reins on one economic policy, it might tighten them on another. That could be what's at work behind China's efforts to curb its external surpluses by permitting energy prices to increase and allowing its currency to strengthen.
Loosening controls on energy prices and exchange rates should go hand in hand, allowing market forces to play a greater role, because previous rigid controls on both have caused distortions harmful to sustainable economic growth.
But China has been reluctant to make sustained moves on either front because of ripple effects that increase export costs and hurt job growth.
Having raised domestic fuel prices last month to bring them closer to global market levels, China is now less likely to keep acting aggressively on the currency front.
There is a growing recognition in China that increased energy and environmental costs for businesses will raise export prices and could achieve the same objective as a stronger currency.


Delta and American report losses on high fuel prices and economy

American Airlines said that, including one-time charges, it lost $1.45 billion, or $5.77 a share, compared with a profit of $317 million, or $1.08 a share, a year earlier. Without the charges, American said its loss was $248 million, or $1.13 a share. American's revenue rose 5.1 percent, to $6.18 billion.
Delta reported a loss of $1.04 billion, or $2.64 a share, compared with a profit of $1.59 billion a year earlier. Much of Delta's loss came from one-time charges of $1.2 billion. Excluding those special charges, Delta said it had net income of $137 million, or 35 cents a share, compared with $274 million a year earlier. On that basis, analysts polled by Thomson Financial expected a profit of 10 cents a share.


Ryanair to ground planes and trim service

Ryanair Holdings, the biggest discount airline in Europe, will ground 15 planes at London Stansted and suspend flights at seven cities as record fuel prices and higher airport fees make routes unprofitable.


TNK-BP dispute seen tearing company apart

MOSCOW: TNK-BP Chief Executive Robert Dudley said a shareholder dispute would "tear the company apart" after a group of employees filed a lawsuit on Thursday that accused him of mismanaging Russia's No. 3 oil firm.


BHP/Mitsubishi group buys Australian coal project

LONDON: The world's biggest mining group BHP Billiton and partner Mitsubishi Corp agreed to pay $2.4 billion (1.2 billion pounds) in cash for a coal project next to their existing mine in Australia, BHP said on Thursday.
The BHP Billiton Mitsubishi Alliance (BMA), the world's biggest producer of coal used in steelmaking, will buy the New Saraji project from Australian coal producer New Hope Corp, a statement said.
"New Saraji has the potential to be developed into a large-scale, high-quality metallurgical coal operation. New Saraji could also potentially deliver significant synergies due to its proximity to BMA's existing Saraji mine," BHP Billiton Coal President Dave Murray said.
The project, located near Bysart in Queensland, has estimated total resources of 690 million tonnes.


Roy Huffington, independent oilman, is dead at 90

Roy Huffington, an independent oilman who defied oil industry precedent by signing an unusually generous deal with Indonesia, made a fortune on natural gas there, then became United States ambassador to Austria, died on Friday in Venice. He was 90.
His death was confirmed by Ralph Dittman, his son-in-law. Huffington, who lived in Houston, was vacationing when he died.
Huffington was something of a legend in the world's oil patches and boardrooms. His father, an oilman, died in an accident when he was 14, so Roy had to get up at 4:30 a.m. to deliver papers to help pay family bills.
He earned a doctorate in geology at Harvard, then hit oil in 17 of the first 18 wells he drilled. He suspected that there might be natural gas in Indonesia, he once said, because its geology seemed to resemble that of the Gulf Coast.
He gave to hundreds of charities and Republican campaigns, including those of his son, Michael, who won a congressional seat in California but lost a senatorial bid there.

The political commentator and blogger Arianna Huffington is a former wife of Michael's. In an essay on her Web site, the Huffington Post, she called Roy Huffington "an oilman when oil exploration was still a romantic endeavor."
Huffington was nonetheless not a prototypical wildcatter. He spoke softly and intellectually, never wore a cowboy hat and was chairman of the Asia Society in New York and the Salzburg Global Seminar, which brings together prominent people to share ideas.
Huffington came to prominence at a time when producing countries were seeking more control of their own petroleum resources. Previously, oil companies, mostly the giant ones called majors, had demanded ownership of the reserves they found and produced. The companies then paid the producing countries royalties and taxes.
Huffington, by contrast, made a deal to share the revenues from any oil and gas his company found, The Oil and Gas Journal reported in 1984. And rather than hoard expertise and technology, something countries had long accused the majors of doing, Huffington shared them. Indonesians thus learned to run their own fields.
Big companies fought back with money. "If the majors don't like what you wanted to do, they just didn't put up the money and that, they thought, would stop you," Huffington said in an interview with Forbes in 1977.
Huffington himself raised money by bringing in other independent oil companies as partners. He helped persuade Japanese utilities to pay for a pipeline and a plant to convert gas to liquid form, or LNG. He persuaded the United States to subsidize building tanker ships.
In a typically prudent step, he even joined forces with a major, Mobil Oil Indonesia, to expand the size of the Indonesia natural gas project. Mobil, now part of Exxon Mobil, then renounced ownership of the gas reserves and accepted the same deal as Huffington, called production sharing.
One result of the partnership was to prove that extracting natural gas from remote areas could be profitable when it was converted into liquid at extremely low temperatures. It could then be shipped by sea.
After seven years of operation, the project produced enough gas to meet the fuel requirements of the equivalent of eight cities of 500,000 people and made Indonesia the world's largest LNG supplier.
The project increased Huffington's personal net worth to more than $300 million, by Forbes's estimate, when he sold his businesses to the Chinese Petroleum Corporation in 1989.
In 1990, when his old friend from the oil patch President George H. W. Bush, asked him to be ambassador to Austria, he accepted, and served for three years. He worked to improve business ties with the former Soviet bloc.
Roy Michel Huffington was born in Tomball, Texas, on Oct. 4, 1917. After tiring of being called "Michelle," he later changed his middle name to Michael. He graduated from Southern Methodist University as a geology major in three and a half years. He earned his Ph.D. from Harvard in 1942, then spent three years in the U.S. Navy on an aircraft carrier in the Pacific.
For the next decade, he worked for Humble Oil, the precursor to the domestic unit of Exxon Mobil. He set out on his own in 1956, having saved enough money to survive for three years. For 18 months, he did not make "a red cent," he said, but then he began to strike oil.
His wife of 58 years, the former Phyllis Gough, died in 2003. He is survived by his son, Michael, of Los Angeles, Boston and Houston; his daughter, Terry Huffington, of Houston; and four granddaughters.
In the interview with Forbes, Huffington said he liked drilling for oil because of his fascination with geology. "It's good to peel back the earth and see the history of the world," he said, adding that by comparison, "our lifetimes are but a fraction of a second."

Doping once again roils the Tour de France
NARBONNE, France: For the third time in three years, the Tour de France was thrown into turmoil Thursday as one of its leaders failed a drug test in midrace.
Riccardo Riccò, an Italian rider who has already won two stages this year, was escorted away from the start of the 12th stage by the French police. He was the third cyclist to have tested positive for the banned blood-boosting drug EPO this year. The team he rode for, Saunier Duval-Scott, immediately withdrew from the race.
As the police led Riccò off the team bus and took him away for questioning, spectators booed, The Associated Press reported.
Riccò is by far the most visible cyclist to be caught this year. He was in ninth overall and led in the king of the mountains category after winning two stages this year in the mountains. After his second victory, in the ninth stage, he angrily denied allegations in the French media that he had suspect blood levels or that there was any reason for him to be targeted by French anti-doping officials.
He said he had a medical certificate acknowledging that he had a naturally high hematocrit level, a measure of the proportion of red cells in blood.


Cavendish wins 12th stage for hat-trick
NARBONNE, France: Mark Cavendish outpaced his fellow sprinters to take his third win on the Tour de France after it was hit again by a drugs scandal on Thursday.
The Briton prevailed at the end of the 168.5-km 12th stage from Lavelanet that started without the Saunier-Duval team, who pulled out of the race after it was revealed Italian Riccardo Ricco had tested positive for the blood-boosting drug EPO.
Cavendish, who rides for Team Columbia, beat France's Sebastien Chavanel of La Francaise des Jeux with Belgian Geert Steegmans coming home third for Quick Step.
Asked about Ricco's positive test, Cavendish said: "It's a massive disappointment for the organisers but what matters is that you get the cheats."
Australian Cadel Evans of the Silence-Lotto team retained the overall leader's yellow jersey

Germany moves into Georgia-Russia dispute


Troop buildup escalates at temple on Cambodian-Thai border

Progress for some means eviction for others in Cambodia
ANDONG, Cambodia: When the monsoon rain pours through Mao Sein's torn thatch roof, she pulls a straw sleeping mat over herself and her three small children and waits until it stops.
They sit on a low table as floodwater rises, sometimes to shin level, she said, bringing with it the sewage that runs along the mud paths outside her shack.
Mao Sein, 34, is a widow and a scavenger, and as these things go, she could be doing worse. When the government raided a squatter colony in Phnom Penh two years ago to clear it for a new development, it allowed 700 families to resettle to this open field 20 kilometers, or 12 miles, outside the capital.
There is no clean water or electricity here, no paved roads or permanent buildings. But the fact that there is land to live on has drawn scores of new homeless families, now squatting among the former squatters.
Like tens of thousands around the country, the people here are victims of what experts say has become the most serious human rights abuse in the country - land seizures, forced evictions and homelessness.
"Expropriation of the land of Cambodia's poor is reaching a disastrous level," Basil Fernando, executive director of the Asian Human Rights Commission in Hong Kong, said earlier this year. "The courts are politicized and corrupt, and impunity for human rights violators remains the norm."

Hands-off foreign policy a collapse of creativity

SHANGHAI: Think of it this way. The Olympic Games are in the bag. World leaders are lining up to attend the opening ceremonies, and even Nicolas Sarkozy of France, who made a brief stand over repression in Tibet, has fallen in with the crowd.
It's as safe now as it ever will be to fly one's true colors, and in the last week, that's precisely what China has done, joining Russia in a veto of sanctions on Robert Mugabe of Zimbabwe and expressing opposition to a warrant sought by the prosecutor at the International Criminal Court for the arrest of the Sudanese president, Omar Hassan al-Bashir.
Let's be clear for a moment about what this column is not. This is not an argument in favor of a boycott of the Olympic Games, in which China has invested stupendous sums, both in cash and cachet.
It is also not an out-of-hand dismissal of China's long-held conservative views about the power of the United Nations Security Council, where Beijing enjoys a veto, to respond to the "internal" crises of other countries.
What follows instead is a double expression of regret that China has summoned so little creative energy filling the huge void that one encounters in the space that most major powers reserve for their foreign policy.
Plainly spoken, as a global actor, China remains an essentially reactive force, one keen to limit the power or the range of action of others in the name of principles such as democracy, human rights and self-determination.

Kristof: Stopping genocide
Many aid workers and diplomats suffered a panic attack when the chief prosecutor of the International Criminal Court sought an arrest warrant this week for the president of Sudan, Omar Hassan al-Bashir, for committing genocide. They feared that Bashir would retaliate by attacking peacekeepers and humanitarian workers.
But instead of wringing our hands, we should be applauding. The prosecution for genocide is a historic step that also creates an opportunity in Sudan, particularly if China can now be induced and shamed into suspending the transfer of weapons used to slaughter civilians in Darfur.
If China continues - it is the main supplier of arms used in the genocide - then it may itself be in violation of the 1948 Genocide Convention. Article III of the convention declares that one of the punishable crimes is "complicity in genocide"; that's the crime that China may be committing if it goes on supplying arms used for genocide, even after the ICC has begun criminal proceedings against the purchaser of those weapons.
Beijing seems unabashed. Incredibly, China and Russia are acting as Bashir's lawyers, quietly urging the UN Security Council to intervene to delay criminal proceedings against him. Such a delay is a bad idea, unless Bashir agrees to go into exile.
Still, China does care about its image. Beijing supplied arms to Pol Pot's genocidal regime in Cambodia but later distanced itself from the Khmer Rouge as international criticism grew. China also supported Slobodan Milosevic until he was indicted, but then almost immediately let him hang out to dry.
One test of China's attitudes will be whether Bashir is welcomed at the Olympic Games' opening ceremony next month. (If President Bush is not careful, he may find himself seated at the ceremony between Bashir and Robert Mugabe.)

Whose crimes against humanity?

Rami G. Khouri is editor-at-large of The Daily Star and director of the Issam Fares Institute for Public Policy and International Affairs at the American University of Beirut. Distributed by Agence Global.
We stand before a decisive moment, brought on by the call on Monday by a prosecutor at the International Criminal Court for a warrant to arrest the Sudanese president, Omar Hassan al-Bashir, on 10 charges of genocide, war crimes and crimes against humanity for his policies in Darfur. This is a moment of historical reckoning for the leaders and people of the Arab world. How they respond to this challenge may well determine whether the region collectively shows its desire to affirm the rule of law as its guiding principle, or moves deeper into the realm of dysfunctional, brittle and violent statehood.
It is a classic example of how the Arab world is politically tortured and ethically convoluted by its twin status as both victim and perpetrator of various crimes and atrocities. Bashir is being accused and may be put on trial. But, on another level, many in the Middle East and elsewhere will ask if this move is a new form of racism and colonialism that applies different standards of accountability for different countries.
The critics of the ICC should not be dismissed as hopeless despots, nor should the court's potential indictment of Bashir be dismissed as neocolonialism administered through the UN Security Council that asked for the investigation in the first place.
The ICC's 10-page summary of Prosecutor Luis Moreno-Ocampo's request to arrest Bashir is well worth reading as a starting point for considering whether this move is appropriate or not.
The chilling details in the prosecutor's summary of the case revolve around charges that include acts of murder, extermination, forcible transfer, torture, rape, attacks on civilians and pillaging towns and villages. They state that Bashir "masterminded and implemented" a plan to destroy three of the largest ethnic groups in Darfur - the Fur, Masalit and Zaghawa - by using the armed forces, the Janjaweed militias, and the entire government apparatus, to specifically and purposefully target civilians.
The charges state that over 35,000 people were killed and 2.7 million displaced, and refugee and displaced persons camps were also attacked and harassed, in a policy aimed at destroying these people as distinct groups or tribes. Rape has been a common tactic, they allege, with one third of rape victims being children.

Zimbabwe estimates inflation at 2.2 million percent
HARARE, Zimbabwe: The official measure of inflation has soared to 2.2 million percent in Zimbabwe, the central bank said Thursday, and has shot as high as 70 million percent in the past year for some basic goods sold on the black market.
Worsening shortages of basic goods, and the deadly political and economic turmoil surrounding the national elections on March 29 and a disputed presidential runoff vote on June 27, helped spur the spike in inflation in recent months.
The last announcement of official annual inflation, in February, put the rate at 165,000 percent.
Gideon Gono, the governor of the Zimbabwe Reserve Bank, announced the new figure at the inauguration of a program to sell subsidized food through some shops.
He also introduced a system of coupons issued to the needy, the state radio reported.

UBS halts U.S. offshore services
WASHINGTON: UBS AG overhauled its offshore private banking business for U.S. residents on Thursday in the face of accusations by congressional investigators that the Swiss bank helped clients dodge taxes.
In a dramatic hearing on Capitol Hill before a Senate subcommittee, a senior UBS executive apologized and announced the bank would cease offering cross-border private banking through its unregulated units to U.S.-domiciled customers.
Mark Branson, chief financial officer for UBS Global Wealth Management and Business Banking, said the bank's 80,000 employees were alarmed by reports of misconduct.
"They want to know that such misconduct does not belong in UBS and that the firm's ethics match their own," Branson said.
"I am here today to tell you and to tell them that no, that kind of misconduct does not belong in UBS."


In financial desert, a veritable oasis in Dubai
DUBAI: Bathed in the glow of the skyline's glitter, the centerpiece of Dubai's financial hub seems equal to the thrusting ambitions of the foreign investment bankers rushing to set up shop here.
"This is the new Wall Street - it's the center of gravity," said Fares Noujaim, Merrill Lynch's new president of the company's business in the Middle East and North Africa, pointing up at the main building of the Dubai International Financial Center that covers the sky above him.
Called the Gate, it seems more a giant slab of modern art than an office building.
The Dubai boom has been riding oil's ascent for several years now. Its ultramodern skyline, which barely existed little more than a decade ago, has become a prominent symbol of the emergence of this once scrubby emirate on the western coast of the Gulf as the Middle East's principal financial, trade and tourism center.
But as the deepening bite of the credit crunch spreads from Wall Street and takes a global toll - torpedoing once buoyant markets from Shanghai to Stockholm - the Gate has recently become an even more powerful beacon for a swarm of deal makers looking to stake their claim in one of the world's last remaining bull markets.

Merrill Lynch pulls out of talks on moving into N.Y. ground zero office tower
NEW YORK: Merrill Lynch, the financially ailing investment brokerage, has terminated talks with the Port Authority of New York and New Jersey and the developer Larry Silverstein about moving its headquarters to one of the new office towers planned for the site of the former World Trade Center.

Merrill sale would give a value to Bloomberg LP
After more than two decades, Mayor Michael Bloomberg and one of his earliest business partners, Merrill Lynch, are parting company in a deal that finally places a public value of the mayor's private company, Bloomberg LP.
That figure: At least $22.5 billion.
Bloomberg is expected to buy Merrill Lynch's 20 percent stake in Bloomberg LP, the financial data and news provider he founded, for about $4.5 billion, people briefed on the deal said Wednesday afternoon. The sale will be handled through the blind trust that manages the mayor's fortune

Merrill selling assets
NEW YORK: Merrill Lynch & Co on Thursday said it is selling close to $8 billion (4 billion pounds) of assets in a bid to raise fresh capital and posted a $4.9 billion second-quarter loss because of write-downs.
Merrill said it sold its 20 percent stake in Bloomberg for $4.425 billion. The bank is also in discussions to sell a controlling interest in Financial Data Services Inc for about $3.5 billion. The company provides administrative services to Merrill's mutual funds and retail banking.

Commodity barons buying up sports clubs
At the height of the commodities boom, Russian steel magnate Alisher Usmanov bought a stake in top English side Arsenal, and Indian steel billionaire Lakshmi Mittal has acquired part of lower division Queens Park Rangers (QPR).
"Commodities players are the current phase of new wealth. They're driven to be legitimate in the public light, to have boys' toys and a safe haven," said Robert Boland, a professor of sports management at New York University.
Buying football teams or other sports clubs can tick several boxes for these successful and driven businessmen.
"I was a fan of the team and realised that, together with the excitement and pleasure I could derive from watching Arsenal's games, I could also have a good portfolio investment," Usmanov told Reuters.
Usmanov, born in Uzbekistan but now a Russian citizen, owns half of steel firm Metalloinvest and part owns Red and White Holdings, which has built up a 24 percent holding in Arsenal.
"I haven't yet made any investments that have made a loss. I'm 100 percent sure that Arsenal, as a business, is worth twice as much as its current value," he added.

What makes a beach book?
What makes a beach book? It's a crucial question for publishers — not to mention readers — this month. Thrillers and police procedurals top many lists. But a novel of manners can slip in. Or perhaps a book of short stories, so easy to dip in and out of between dips. The only rule: No doorstops — they're too hard to read in a beach chair.

'Heavy Metal Islam': Muslim youth and a lot of idealism
Heavy Metal Islam Rock, Resistance, and the Struggle for the Soul of Islam
By Mark LeVine 296 pages.
Paper, $13.95. Three Rivers Press.
This professor of Middle Eastern history walks into a bar in Fez, Morocco - right from the get-go, Mark LeVine's "Heavy Metal Islam: Rock, Resistance, and the Struggle for the Soul of Islam" is not your typical dry academic slog.
(Did I mention he's also a longhaired Jewish rock guitarist whose bio lists gigs with Mick Jagger and Dr. John?) So when somebody in that hotel bar starts talking up the local punk and metal scenes, an incredulous LeVine is hooked. "There are Muslim punks? In Morocco?" Quicker than you can whistle "Rock the Casbah," he's on the trail of Western-influenced underground music movements that have blossomed under authoritarian regimes across the Middle East and North Africa.
Going to meet the seven-string guitarist Marz of Hate Suffocation, a Cairo band, LeVine confesses, "I still couldn't tell the difference between death, doom, black, melodic, symphonic, grind-core, hard-core, thrash and half a dozen other styles." (Marz explains that his group plays a cross between death and black metal: "But it's not blackened death metal!") Despite a certain amount of scholarly dogma that goes with the territory - here any combination of "neo-liberal" and "globalization" is as ominous an epithet as Black Sabbath's "War Pigs" - "Heavy Metal Islam" offers the hit-and-run (as well as hit-and-miss) pleasures of a lively road trip.
Practicing a first-person brand of shuttle diplomacy as he moves between countries and cultures, musicians and Islamic activists, LeVine manages to unpack enough cross-cultural incongruities to mount his own mosh pit follow-up to "You Don't Mess With the Zohan." An ex-Mossad hairdresser is scarcely more anomalous than disheveled Moroccan riot grrrls, virtuoso Egyptian metalheads, Lebanese "muhajababes" (young women wearing full head scarves, army fatigues, tight black T-shirts and Hezbollah wristbands), Tupac-influenced Palestinian M.C.'s, "the Israeli Oriental death-doom metal band Orphaned Land" (complete with a devoted Arab following) and rapt Iranian Iron Maiden acolytes. LeVine not only meets and eats with Muslim headbangers, he jams with them in apartments, studios and outdoor festivals, taking in the food and the noise and the people as if it were all a movable metal feast.

Morocco to send moderate preachers to Europe during Ramadan
RABAT, Morocco: Morocco plans to send scores of moderate Muslim preachers to Europe during the holy month of Ramadan to help fight extremism in the Moroccan community abroad, the Ministry for Religious Affairs said Thursday.
The government will send 167 male and 9 female preachers to address Moroccan immigrants during Ramadan, in September this year. The ministry said 100 preachers would go to France and Belgium, while Italy and Germany would get 10 each and Spain and the Netherlands 7. The rest will head to Scandinavia and Britain, while one preacher will go to Canada.
The preachers are instructed to "answer the religious needs of the Moroccan community abroad, to protect it from any speeches of extremism or irregular nature, and to shelter it from extremism and fanaticism," the ministry said in a statement.
Abdellatif Begdouri Achkari, chief of staff of the religious affairs minister, said Morocco has been sending preachers to minister abroad for many years but that it had carefully selected the latest group to make sure they specifically address the issue of extremism.
"The needs of the Moroccan community abroad may vary from one community to another, and these needs evolve with time," Achkari said.
Islam is the state religion of Morocco and King Mohammed VI is officially "the commander of the believers."
But the country's official, moderate practice of Islam has faced a growing wave of extremism in recent years. Security officials have voiced concerns about Moroccans and dual Moroccan-European citizens having links to terrorist groups.
The religious affairs ministry said 100 preachers would go to France and Belgium; Italy and Germany would get 10 each; and Spain and the Netherlands would receive seven preachers. The other selected preachers will head to Scandinavia, Britain and Canada.
Strict criteria were applied in the selection process. Besides being well-versed in the Koran and knowledgeable about theology, the candidates had to be "known for their good reputation, devout beliefs and high moral standards," the ministry said.
There are an estimated 3.3 million Moroccans living abroad, 10 percent of all Moroccans.

Spanish court clears 4 in 2004 Madrid bombings

Deep flaws found in U.S. health care
NEW YORK: American medical care might be the most expensive in the world, but it is getting increasingly difficult to argue that it is worth every penny. A study that was to be released on Thursday highlights the stark contrast between what the United States spends on its health system and the quality of care it delivers, compared with health care in many other industrialized nations.
The report, the second national scorecard prepared by an influential health policy research group, provides evidence of just how frequently the country falls short of its own standards of care and those of its global peers. While the United States spends more than twice as much per capita on health care as most other industrialized countries, including France, it has fallen to last place among those countries in being able to prevent deaths with timely and effective medical care, according the report by the Commonwealth Fund, a not-for-profit research group in New York.
Access to care in the United States has worsened as more people - about 75 million - are believed to lack adequate health insurance or be uninsured altogether. And within the nation, the cost and quality of care varies dramatically, the report found.

White House calls Bush fund-raiser's actions 'inappropriate'
WASHINGTON: The White House has disavowed the actions of a major fund-raiser for George W. Bush's presidential campaigns who was caught on videotape apparently trying to trade access to top administration officials - including Vice President Dick Cheney and Secretary of State Condoleezza Rice - in exchange for six-figure donations to Bush's library foundation.
The fund-raiser, Stephen Payne, founder of Worldwide Strategic Partners in Houston, was shown suggesting the donations in a video posted Sunday on the Web site of The Times of London, which filmed him surreptitiously as part of an investigation into corruption in foreign governments.
Payne, apparently believing he was talking to a representative of the former president of Kyrgyzstan, was shown saying that he could arrange meetings with top administration officials but that a meeting with the president himself would be difficult. The newspaper also posted photographs of Payne cutting brush with Bush at the president's ranch in Texas and shooting skeet with Cheney.
"I think the family, the children, whatever, should probably look at making a contribution to the Bush library," Payne says on the tape, adding: "It would be like, maybe a couple hundred thousand dollars, or something like that, not a huge amount but enough to show that they're serious. They haven't started raising the money yet, but they will in the next couple of months."
Bush's press secretary, Dana Perino, called Payne's actions "inappropriate" and said that he did not represent the library or the foundation raising money for it.

Lessons learned from Seattle's $1 million automated toilet units
SEATTLE: After spending $5 million on its five automated public toilets, Seattle is calling it quits.
The restrooms, installed in early 2004, had become so filthy, so overrun with drug users and prostitutes, that even some of the most destitute people in the city refused to step inside them, although use was free of charge.
The units were put up for sale on Wednesday afternoon on the auction site eBay, with a starting price of $89,000 apiece set by the city.
The news coincides with plans by New York, Los Angeles and Boston, among other cities, to spend hundreds of thousands of dollars for expansion this autumn of their automated toilet installations - stand-alone structures with metal doors that open at the press of a button and stay closed for up to 20 minutes. The units clean themselves after each use, disinfecting the seats and power-washing the floors.
Seattle officials say the project failed because the toilets, which are to close on Aug. 1, were placed in neighborhoods that had many drug users and transients. Then there was the matter of cost: $1 million apiece over five years, which because of a local ordinance had to be borne entirely by taxpayers rather than by advertisers.

"Other cities around the world seem to be able to handle toilets civilly," McIver [Richard McIver, a Seattle city councilman] said. "But we were unable to control the street population, and without the benefit of advertising, our costs were awfully high."

"I'm not going to lie: I used to smoke crack in there," Veronyka Cordner, a homeless woman, said of the toilet behind Pike Place Market in Seattle. "But I won't even go inside that thing now. It's disgusting."


U.S. plans peace talks with Israelis and Palestinians

WASHINGTON: U.S. Secretary of State Condoleezza Rice plans to host peace talks in Washington with Israeli and Palestinian negotiators on July 30, Palestinian negotiator Saeb Erekat said on Thursday.
Rice met a Palestinian delegation in Washington on Wednesday and offered to host the three-way meeting between herself, chief Palestinian negotiator Ahmed Qurie and his Israeli partner, Foreign Minister Tzipi Livni, Erekat said.
The top U.S. diplomat is mediating efforts to reach a peace agreement this year between the Palestinians and the Israelis, in the waning months of Bush administration, which ends in January 2009.
Erekat said efforts were also under way for Palestinian President Mahmoud Abbas to meet Israeli Prime Minister Ehud Olmert next week, but he had no further details.
State Department spokesman Sean McCormack declined to confirm the July 30 date for three-way talks but he said Rice would continue to work hard on Palestinian statehood negotiations and this included such meetings.

Losing Private Dwyer
Lawrence Downes is a member of the New York Times editorial board.
This photo captures everything that Americans wanted to believe about the Iraq war in the earliest days of the invasion in 2003. Joseph Dwyer, an Army medic whose unit was fighting its way up the Euphrates to Baghdad, cradles a wounded boy. The child is half-naked and helpless, but trusting. Dwyer's face is strained but calm.
If there are better images of the strength and selflessness of the American soldier, I can't think of any. It is easy to understand why newspapers and magazines around the U.S. ran the photo big, making Dwyer an instant hero, back when the war was a triumphal tale of Iraqi liberation.
That story turned bitter years ago, of course. And the mountain of sorrows keeps growing: Dwyer died last month in North Carolina. He was 31 and very sick. For years he had been in and out of treatment for post-traumatic stress disorder and addiction. He was seized by fearful delusions and fits of violence and rage. His wife left him to save herself and their young daughter. When the police were called to Dwyer's apartment on June 28, he was alone. They broke down the door and found him dying among pill bottles and cans of cleaning solvent that friends said he sniffed to deaden his pain.
He had been heading for a disastrous end ever since he came home.
Two of his best friends were Angela Minor and Dionne Knapp, fellow medics at Fort Bliss, near El Paso, Texas. For a while, they were part of a small, inseparable group that worked together, ate out, went to movies and called one another by their first names, which is not the military habit.
Joseph was a rock, Minor said, a guy who would change your oil and check your tires unasked and pick you up by your broken-down car at 3 a.m. Knapp said he was like an uncle to her son, Justin, who was having trouble in kindergarten and brightened whenever Dwyer went there to check on him.
Knapp was called up to Iraq, but Dwyer insisted on taking her place, because she was a single mom. He had no children at the time, and besides, he had enlisted right after 9/11 just for this. He went and stunned everybody by getting his picture all over the newspapers and TV.
A few months later, he was home. He was shy about his celebrity. He was also skinny and haunted. Minor said he was afraid. Knapp said paranoid was more like it.
It didn't help that El Paso looked a lot like Iraq. Once he totaled his car. He said had seen a box in the road and thought it was a bomb. He couldn't go to the movies anymore: too many people. In restaurants, he sat with his back to the wall.
He said that Iraqis were coming to get him. He would call Angela and Dionne at all hours, to talk vaguely about the "demons" that followed him. He became a Baptist, doggedly searching Scripture on his lunch hour - for solace. His friends knew he was also getting high with spray cans bought at computer stores.
His friends tried an intervention, showing up at his door in October 2005 and demanding his guns and cans of solvent. He refused to give them up.
Hours later, gripped by delusions, he shot up his apartment. He was glad when the Swat team arrived, Knapp said, because then he could tell them where the Iraqis were. He was arrested and discharged, and later moved to Pinehurst, North Carolina. His parents tried to get him help, but nothing worked. "He just couldn't get over the war," his mother, Maureen, told a reporter. "Joseph never came home."
It's not clear what therapy and medication could have saved Dwyer. He admitted lying on a post-deployment questionnaire about what he had seen and suffered because he just wanted to get back to his family. Minor said he sometimes skipped therapy appointments in El Paso. One thing that did seem to help, Knapp and Minor said, was peer counseling from a fellow veteran, a man who had been ambushed in Iraq and knew about fear and death. But that was too little, too late, and both women say they are frustrated with the military for letting Dwyer slip away.
Dwyer, who survived rocket-propelled grenades and shocking violence, made his way back to his family and friends. But part of him was also stuck forever on a road in Iraq, helpless and terrified, with nobody to carry him to safety.

Mexican drug traffickers built car bombs, police say
MONTERREY, Mexico: Mexican drug traffickers have built makeshift car bombs to attack police officers, troops and rival smugglers as the country's drug war turns increasingly violent, the police said.
Soldiers found two car bombs in a safe house in the city of Culiacán in western Mexico on Monday. One car was packed with cans of gasoline and another was stuffed with canisters of gas, the police said.
Both devices were wired to be detonated by cellphones, said a police official in Culiacán, the capital of Sinaloa State, which is home to one of Mexico's biggest trafficking cartels.
"We believe these two car bombs were being designed to harm the military, the police and rivals," the official said on Wednesday. He spoke on condition of anonymity.
Drug gangs often carry automatic weapons and sometimes wield rocket-propelled grenades, but the use of car bombs would be an escalation in the drug war.

Canadian police defend actions after airport death
VANCOUVER, British Columbia: The Royal Canadian Mounted Police dismissed a report on Thursday that it may have compromised investigations into the death of a Polish immigrant during a stun gun incident at Vancouver's airport.
The head of the RCMP privately contacted the four officers involved in the incident, a move that critics said may have conflicted with a promise to co-operate with investigations into the death, the Canadian Broadcasting Corp reported.
The report cited internal RCMP e-mails, which the CBC said showed the police struggled with how to respond to the wave of negative international publicity they received over the death of Robert Dziekanski in October.
Dziekanski died after police shot him with a Taser stun gun and restrained him at Vancouver airport. The incident was caught on video by another passenger and broadcast around the world.
The Mounties said on Thursday they were still committed to fully co-operating with all of the investigations into the incident, which raised public concern over the police use of Taser stun guns.

Media stars will accompany Obama overseas
But when Obama heads for Iraq and other locations overseas this summer, Williams is planning to catch up with him in person, as are the other two evening news anchors, Charles Gibson of ABC and Katie Couric of CBS, who, like Williams, are far along in discussions to interview Obama on successive nights.

China to screen foreign entertainers
BEIJING: Foreign entertainers who have taken part in activities that China deems a threat to its sovereignty will not be allowed to perform in the country, according to a new list of rules posted Thursday on the Web site of the Ministry of Culture.
The rules say that the background credentials of performers from foreign countries, Hong Kong, Macau and Taiwan will be scrutinized carefully. "Those who used to take part in activities that harm our nation's sovereignty are firmly not allowed to perform in China," the rules say.
They also call for banning performers who promote ethnic hatred or "advocate obscenity or feudalism and superstition."
The new rules are the latest attempt by China to clamp down on any political dissent leading up to the Summer Olympics, which begin on Aug. 8. Government officials have set up security checkpoints throughout Beijing, deported foreigners or refused to renew visas, and shut down protests by grieving parents whose children died during school collapses in the May 12 earthquake.
China had promised a more open atmosphere this summer and had told the International Olympic Committee that it would adhere to strict standards for human rights. Many people outside China are now casting serious doubts on China's commitment to those pledges.
The new rules on performances may have come about after an outburst earlier this year from Bjork, the popular Icelandic singer. She used a concert in Shanghai as a platform to advocate for Tibetan independence. She shouted "Tibet! Tibet!" after performing "Declare Independence," a song from her 2007 album, "Volta." The outcry drew sharp criticism from Chinese Internet users and praise from international supporters of an independent Tibet.

Talking sense on the wars in Iraq and Afghanistan
It has been obvious from the start of the 2008 U.S. presidential election campaign that the wars in Iraq and Afghanistan are the biggest foreign policy challenges awaiting the next president. But there has been precious little detailed discussion of them on the campaign trail.
Until this week, when Senator Barack Obama, the presumptive Democratic nominee, offered a sensible blueprint for dealing with the mess that President George Bush created by bungling the war of necessity against Al Qaeda in Afghanistan, which could have made Americans safer, and starting a war of choice in Iraq, which made the world more insecure.
Obama's Republican rival, Senator John McCain, has not matched Obama's seriousness on Iraq. He is still largely adopting Bush's blind defense of an unending conflict.
Obama has a better grasp of the big picture, despite McCain's claim to more foreign policy experience. For far too long, Bush's preoccupation with his misadventure in Iraq has dangerously diverted precious manpower, resources and high-level attention from Afghanistan and Pakistan. As Obama has correctly asserted, those countries, not Iraq, are the real frontline of the war against terrorism.
Obama said he would withdraw combat forces from Iraq by 2010, shift at least 10,000 more troops to Afghanistan that could be leveraged to persuade NATO allies to also increase their numbers, send more nonmilitary aid to Afghanistan and build a stronger Afghanistan-Pakistan-NATO partnership on the lawless border. He also promised an extra $2 billion as part of an international effort to deal with more than 4 million displaced Iraqis - a crisis that the Bush administration has unconscionably ignored
We were encouraged that Obama embraced a proposal by the leaders of the Senate Foreign Relations Committee to triple nonmilitary aid to Pakistan to $7.5 billion over five years. The United States must invest more in strengthening Pakistan's democracy. Congress should move quickly to adopt the proposal, which also would require a long-overdue plan to address the lawlessness of the Afghan-Pakistan border.
After arguing that no additional forces were needed, McCain reversed course on Tuesday and endorsed sending 15,000 more troops to Afghanistan. But he seemed confused about whether they would be U.S. forces drawn from Iraq or an American-NATO mix, leaving us wondering how well formed his ideas are.
And it was distressing to hear McCain still talking about "winning" the war in Iraq and adopting the tedious tactic of accusing Obama of "giving up" when he talks about a careful withdrawal of troops.
We have no idea what winning means to McCain. Bush initially promised a free and democratic Iraq. After spending $656 billion, his administration has retreated from such grandiose notions and he will be lucky to leave behind a marginally functioning central government in a very fragile country.
Obama acknowledged that reality, and the fact that Bush's decision to deploy more troops last year has reduced the violence. McCain uses that to justify an unending war. Obama wisely said that it was time to capitalize on American soldiers' sacrifices to plan an end to the war.
"At some point, a judgment must be made," he said. "Iraq is not going to be a perfect place, and we don't have the resources to try to make it one."
The United States cannot just turn its back on Iraq, but that is not remotely what Obama is suggesting. He proposed keeping a residual force in Iraq for specific missions like fighting Al Qaeda. He also wisely asserted he will make tactical adjustments as needed.
The more the United States insists it will not even consider withdrawal, the less incentive Iraqis have to settle their political differences. Iraq's leaders have asked for a withdrawal timetable. The next president needs to take them at their word. The candidates need to keep talking about how they will meet that goal and then address the real threats in Afghanistan and Pakistan.

Afghan militants killed in airstrikes, U.S. says
KABUL, Afghanistan: U.S. and Afghan special forces killed two influential tribal leaders and a number of their followers in western Afghanistan in a joint airborne operation Wednesday night amid more accusations of causing civilian casualties, military officials said Thursday.
Both NATO and the Afghan Ministry of Defense said that the tribal leaders were high-priority Taliban targets and that the operation against them successful. There was no evidence of civilian casualties, a statement issued by the NATO press office in Kabul said.
But villagers gave a different account, saying houses were bombed and civilians killed and wounded as they fled in the night. Local officials confirmed the bombardment and damage to houses but did not say if civilians were killed or injured.
The operation took place in the Zerkoh valley near Shindand, where United States special forces clashed with the same tribe in April 2007. When they came under fire from villagers the special forces called in airstrikes on the village, resulting in 57 deaths, including women and children.
That incident, coming after marines had killed 19 civilians in eastern Afghanistan the previous month, caused an outcry from Afghan politicians and humanitarian organizations and led the NATO commander of the time, General Dan McNeill, to issue orders to his forces to take extra care to avoid civilian casualties.

Karl F. Inderfurth served as U.S. assistant secretary of state for South Asia from 1997-2001 and is a professor of international affairs at George Washington University. Wendy Chamberlin served as U.S. ambassador to Pakistan from 2001-2002 and is president of the Washington-based Middle East Institute.
The deadly suicide attack last week on the Indian Embassy in Kabul has put Afghanistan in a familiar but unwanted position - a "back to the future" scenario, caught up again in the intrigues and suspicions of its neighbor, Pakistan, and Pakistan's neighbor, India. But this time around, the stakes are too high to replay old rivalries.
President Hamid Karzai of Afghanistan said that Pakistan's intelligence service, known as the ISI, was behind the Indian Embassy bombing. His government announced it would boycott a series of meetings with Pakistan until "bilateral trust" was restored.
Indian officials said the attack was intended to send a stark message to India: Get out of Afghanistan. India's national security adviser, M.K. Narayanan, declared that the ISI must be "destroyed" and that if things continued in this manner, there would be no choice but to "retaliate in kind."
Pakistan's prime minister, Yousuf Raza Gilani, declared all accusations "baseless" and "malicious."
It was not supposed to be this way.
The February election in Pakistan was a positive return to civilian-led democracy in that country. The new leadership in Islamabad said it wanted to improve long-troubled relations with Kabul. But five months later the civilian coalition in Pakistan is weak and in crisis.
Internal struggles between Pakistan's two major parties - the PPP, led by the late Benazir Bhutto's husband, Asif Ali Zardari, and the PML-N, led by former Prime Minister Nawaz Sharif - have left a foreign policy vacuum that radical elements, almost certainly with ISI connections, have exploited to advance their own agenda. That agenda is a flashback to the period before 9/11, when the ISI believed it needed a friend (Taliban) in Kabul to offset Indian influence in Afghanistan.
Combined with the many other challenges facing Afghanistan today, the recent revival of the Pakistan-Indian rivalry makes the odds of Afghanistan becoming a stable country that much more remote. A multi-pronged diplomatic initiative by the parties involved, with strong international support, is urgently needed to turn this situation around.
Reducing antagonisms between Afghanistan and Pakistan must be the top priority. Afghanistan has legitimate concerns, especially about the resurgent Taliban's use of Pakistani territory as a safe haven. Kabul blames Islamabad for this. Islamabad's full and continuous cooperation to stop cross-border attacks in Afghanistan, as well as ISI interference in Afghanistan's affairs, is an essential condition for stabilizing relations.
For its part, Pakistan is aggrieved at Karzai's public finger-pointing at Pakistan after every spectacular extremist attack, like the Taliban raid that liberated 400 prisoners in Afghanistan. The truth is that both Kabul and Islamabad share the same enemies. Taliban, Al Qaeda, ISI-supported terrorist groups that operated in Kashmir, and even the old militant groups that the United States once supported to fight against the Soviets now stage attacks on Pakistani, Afghan, U.S. and NATO forces. A mutual effort to counter the common threat would be a more productive approach.
Pakistan and India also should build on their positive diplomatic developments over the past several years to tackle the very sensitive issue of Afghanistan. Approaching talks in New Delhi between the foreign ministers of the two countries provide an excellent opportunity to do this. But it won't be easy.
India will claim it has legitimate interests in Afghanistan and that it is a major donor in the international effort to rebuild that country. Pakistan will charge that India is running operations out of its many consulates in Afghanistan to stir trouble across the border, especially to fan the flames of the anti-Islamabad insurgency in Baluchistan. Pakistan sees itself as potentially caught in a vice between its western and eastern neighbors.
But these long-standing concerns are now being trumped by a new reality, the need for India and Pakistan to look beyond their traditional rivalries and agree on a joint strategy to confront the extremists operating along the Pakistan-Afghanistan border.
"Whatever problems we had with Pakistan," says C. Raja Mohan, a leading Indian security analyst, "Pakistan had been a buffer between India and the badlands. Now the buffer is falling apart. Afghanistan needs to be stabilized. Pakistan needs to be stabilized. This requires more drastic action."
Direct talks also present the opportunity for India and Pakistan to address the one issue that has long bedeviled their relations - the dispute over Kashmir. After a long history of playing a "dirty game" with terrorist groups against India, the tables have turned. The terrorist groups present a much more serious threat to Pakistan's internal stability than they offer as instruments of asymmetrical warfare against India. Today's common security interests of India and Pakistan should drive the two countries toward finding a settlement over Kashmir.
Pakistan's foreign minister, Makhdoom Shah Mahmood Qureshi, recently said in Washington: "The time is now for taking bold steps to take Pakistan and India out of a cycle of hostility, acrimony, and mutual suspicion." That advice also applies to efforts to stabilize Afghanistan. All three countries need to engage in active, high-level diplomacy aimed at stemming the spread of extremism in their common neighborhood. Their security fates are intertwined.

Scotland's hunger for independence proves annoying in England
EDINBURGH: Stuck in a chronic sports slump, Britons are eternally searching for a home-grown tennis star with a fighting chance of winning Wimbledon. Their latest is 21-year-old Andy Murray, who this summer demonstrated traditional British come-from-behind pluck in advancing to the quarter finals. He finally lost to the eventual champion, Rafael Nadal.
But there was a small problem. Murray is Scottish, and fiercely so. Asked once who he planned to support in the World Cup soccer tournament, he replied: "Anyone but England."
And many English people found his recent behavior at Wimbledon - he emitted warlike whoops, bared his teeth and flexed his biceps in a provocative manner - more suited to a remake of "Braveheart" than to the gentle green courts of west London.
"Part of the reason some of us have found it difficult to like him is that he is so obviously Scottish," the columnist Stephen Glover said bluntly in The Daily Mail. Or, as Tony Parsons wrote in The Daily Mirror: "If the English can survive the attentions of the Luftwaffe, the IRA and Al Qaeda, then I quite fancy our chances against Andy Murray."
Their vehemence was surprising. The English usually tend to regard the Scots as their slightly prickly but relatively harmless and quashable northern cousins. But lately, there has been a newfound resentment in England that has mirrored a growing confidence and sense of nationalistic entitlement - a general flexing of the biceps - in Scotland. With relations at their uneasiest point in decades, there is even talk that unless the balance of power can somehow be renegotiated, the union is in danger of unraveling.
"This is about a shift in British attitudes," said Joyce McMillan, a columnist for The Scotsman newspaper. "We've always been seen as slightly exotic or decorative. But if we start on as if we were some kind of self-determining nation, it provokes a kind of atmosphere of hurt and anger, like 'Oh, what was wrong with the way we were ruling you? Why aren't you grateful?"'
Scotland has been the inferior partner since 1707, when it and its Parliament were subsumed by the larger country of Britain. But three centuries is no time at all in the minds of many Scots, who have fumed in resentment and, to a lesser or greater extent, clamored for independence, ever since.
The current era in Scottish-English relations began in 1997, when Tony Blair's Labour government addressed the persistent irritant of Scottish nationalism by giving the Scots more power to settle their own affairs. Scotland got its own Parliament, with responsibility over areas like health, social services and education.
Devolution, as this transfer in power is called, was supposed to "kill Scottish nationalism stone dead," in the saying of the time. But instead, it has only magnified the Scots' differences with the English.
"What you've had since devolution is that England and Scotland are starting to drift apart culturally and politically, so they seem like entirely different countries," said Guy Lodge, a senior research fellow at the Institute for Public Policy Research, a left-leaning study group in London.
Though Scotland is an old Labour stronghold, many Scots are disillusioned with the Labour government - even though the current prime minister, Gordon Brown, is Scottish. Since last year, the Scottish National Party, which favors Scottish independence, has been in power in the Scottish Parliament. Its able leader, Alex Salmond, has confounded Labour by proving that the nationalists can govern plausibly at home.
Salmond has used Scotland's budget, which comes mostly in the form of block grants from London, to enact a series of radical social-service measures. In contrast to the residents of the rest of Britain, Scots get free university tuition and free personal and nursing care for the elderly. They also pay less for National Health Service prescriptions and have access to a greater range of medicines and treatments for illnesses like cancer.
The Scots argue that they are merely using their available resources more effectively and that they have their priorities straight. But the English complain that the Scots are abusing British largess. A recent report by Lodge's group found that Scotland receives a disproportionately larger share of money per capita than other parts of Britain and suggested that the formula for allocating the money be recalculated.
Philip Davies, a Conservative member of Parliament in London, said that even as the Scots had abolished tuition for Scottish students in Scottish universities, members of Parliament from Scotland voted in favor of tuition in English universities.
"Basically, Scotland is getting better services," Davies said. "And then when they sort themselves out with English taxpayers' money, all the Scottish M.P.'s come trooping down to Westminster and stop the English students from having the same privilege."
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