WAR 05/24 to 05/30 ***The***Winds***of***WAR***

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(10)04/23 to 04/30 ***The***Winds***of***WAR***
http://www.timebomb2000.com/vb/showt...***of***WAR***

(11)05/01 to 05/07 ***The***Winds***of***WAR***
http://www.timebomb2000.com/vb/showt...***of***WAR***

(12)05/08 to 05/15 ***The***Winds***of***WAR***
http://www.timebomb2000.com/vb/showt...***of***WAR***

(13)005/16 to 05/23 ***The*** Winds***of***WAR***
http://www.timebomb2000.com/vb/showthread.php?404804-005-16-to-05-23-***The***-Winds***of***WAR***

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Letting Greece leave the euro is the
lesser of two evils for all concerned

Markets were capitulating last night
as a euro break-up took a step closer.

By Damian Reece, Head of Business
10:32PM BST 23 May 2012
http://www.telegraph.co.uk/finance/...he-lesser-of-two-evils-for-all-concerned.html​

Greek yields blew out again, UK and German yields contracted further, while equity markets in the US and Europe were a sea of red.

Contingency plans for a Greek exit have been talked about all week but none of them add up to more than the financial equivalent of "duck and cover" – the US government's advice it gave citizens in the event of a nuclear attack.

That cheery bit of help anticipated the moment when millions of Americans would hear the two-minute warning, dutifully dive under the nearest table confident Federal advice would protect them, only to be liquidated in an instant.

A euro break-up is probably the least worst option for Europe, especially compared to the asphyxiating economic and political contortions which are tying Europe in knots in order to keep Athens in the fold.

Pursuing these desperate ideas is undermining the principles of monetary union to such an extent that the governance underpinning the system is moving towards collapse with even worse dislocation to come.

Greece, in other words, is a poison pill that's turning the eurozone's necessary harsh medicine toxic.

That certainly seems to be the view of the Bundesbank, which yesterday revealed more about Germany's growing apathy towards keeping the 17 member union together than any institution to date. It reckons a Greek exit would be "manageable", whereas keeping Athens in the union would require bending the rules to such an extent as to make the system and its supposed disciplines meaningless.

The markets believe we're moving closer to break-up because the politics surrounding the euro are getting worse. The zone is splitting financially and politically, the dividing line being which side of the austerity debate you're on.

Eurobonds could be the issue that the disagreements crystallise around, because the instruments would simply be a mass German bail-out of the system by another name. Even if eurobonds were agreed they would represent not a Grexit but a Great Escape, letting Greece off the hook without any solution to the causes of the euro crisis – the worst outcome for all concerned.

UK must hope for a liberating explosion​

Whatever you hear the Coalition saying in the next few weeks and months, there's very little it can do to shield the UK from the fallout of a Greek euro exit. Europe's our biggest trading partner so we're right in the blast zone.

That said, we're getting a pretty good idea of what it's going to be like, with the latest economic news painting a grim picture for both retail sales and industrial production. Confidence, already obviously lacking, will dry up completely and funding to finance activity will disappear. October 2008 is a reasonable benchmark, although that was a banking crisis – this is both a banking crisis and a sovereign debt crisis.

Even our leading bankers, who have lived through every twist and turn of the past four years or more, concede the problem now is too big to understand or predict its outcome. Certainly share prices will go lower from here. Indeed, in September 2008 they went from where we are now down to 3,500 in six months. Vast quantitative easing helped pump share prices back up to 6,000 and the Bank of England can be expected to try the same trick but its effectiveness is waning with every dose.

The hope has to be that a Greek blow-up is the cathartic moment of release, shocking but liberating as the realisation dawns that without this artificial construct life can go on.

Rudd had a spot of Pru-ning in mind​

Amazing what's overheard at the Chelsea Flower Show. You may recall this column on Tuesday highlighting the unusual tale of Paul Manduca's ascendancy to the chairmanship of the Prudential.

As one candidate after another somehow fell by the wayside it was left to Manduca, the Pru non-executive leading the recruitment process, to heroically step into the breach and reluctantly accept the onerous responsibilities himself.

One such overlooked candidate was Sir Nigel Rudd, who's sacked five chief executives at five companies he's chaired. Tidjane Thiam, the Pru chief executive, could be forgiven some anxiety at the prospect of Sir Nigel's arrival.

But he need not have feared. Wandering among the roses at Chelsea, Sir Nigel was heard commenting that Thiam was the sort of chief executive he liked. But as for the Pru's motley bunch of non-executives, well they really could do with a spot of enthusiastic dead-heading, apparently.






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Eurozone looks at Greek exit as leaders meet

Jan Strupczewski and Claire Davenport, Reuters
Updated May 24, 2012, 8:47 am
http://nz.news.yahoo.com/a/-/world/13765792/eurozone-looks-at-greek-exit-as-leaders-meet/​

BRUSSELS (Reuters) - European leaders, at odds over how to resolve the deepening crisis in the euro zone on Wednesday, have been advised by senior officials to prepare contingency plans in case Greece quits the single currency area.

Three officials told Reuters the instruction to be ready was agreed on Monday during a teleconference of the Eurogroup Working Group (EWG) - experts who work for the bloc's finance ministers - and the German central bank said losing Greece would be testing but "manageable".

"The EWG agreed that each euro zone country should prepare a contingency plan, individually, for the potential consequences of a Greek exit from the euro," said one euro zone official.

The Greek finance ministry denied there was any such agreement but Belgian Finance Minister Steven Vanackere, asked by reporters ahead of the EU summit, said:

"All the contingency plans (for Greece) come back to the same thing: to be responsible as a government is to foresee even what you hope to avoid."

The news comes at a highly sensitive time with EU leaders gathering to try to breathe life into their struggling economies at a summit over dinner on Wednesday.

Although minds will be focused by the prospect of Greece leaving the currency area, something EU leaders insist they want to avoid, disagreements over a plan for mutual euro zone bond issuance and other measures to alleviate two years of debt turmoil have already been laid bare.

In its monthly report, Germany's Bundesbank said the situation in Greece was "extremely worrying" and it was jeopardizing any further financial aid by threatening not to implement reforms agreed as part of its two bailouts.

It said a euro exit would pose "considerable but manageable" challenges for its European partners, raising pressure on Athens to keep its painful economic reforms on track.

Greek officials have said that without outside funds, the country will run out of money within two months and there remains the threat that if it crashes out of the euro zone, other member states could be targeted by the markets.

For the first time in more than two years of crisis meetings, the leaders of France and Germany have not huddled beforehand to agree positions, marking a significant shift in the Franco-German axis which has traditionally driven European policymaking.

Instead, new French President Francois Hollande met Spanish Prime Minister Mariano Rajoy in Paris to discuss policy, before the pair travelled to Brussels.

Despite fears Greeks could open the departure door if they vote for anti-bailout parties at a June 17 election, Spain, where the economy is in recession and the banking system is in need of restructuring, is at the front line of the crisis, with concerns growing that it too could need bailing out.

After meeting Hollande, Rajoy said he had no intention of seeking outside aid for Spain's banks, although his government said its rescue of problem lender Bankia would cost at least 9 billion euros ($11 billion).

SHIFTING SANDS​

Socialist Hollande's election victory has significantly changed the terms of the debate in Europe, with his call for greater emphasis on growth rather than debt-cutting now a rallying cry for other leaders.

That has set up a showdown with conservative German Chancellor Angela Merkel, who supports growth but whose primary objective is budget austerity and structural reform.

At his first EU summit, Hollande has chosen to make a stand on euro bonds - the idea of metalizing euro zone debt - despite consistent German opposition to the idea.

He has support from Italian Prime Minister Mario Monti and European Commission President Jose Manuel Barroso, among others. But Merkel shows no sign of dropping her objections to the proposal, which she has said can only be discussed once there is much closer fiscal union in Europe.

The Netherlands, Finland and some smaller euro zone member states support her. "Euro bonds (are) not something we are in favor of, they would increase our borrowing costs," Dutch Prime Minister Mark Rutte said.

Arriving in Brussels, Merkel showed no sign of budging either. "I will propose that the mobility of labor market be improved," she said. "Secondly, it's about structural reform."

No decisions will be made at Wednesday's summit, which is intended to promote ideas on jobs and growth ahead of another meeting at the end of June.

But it is clear debate will be intense, not just over euro bonds but over how to rescue European banks and whether to give more time to struggling euro zone countries to meet their budget deficit goals.

"We haven't come together to confront each other ... but we have to say what we think - what are the right instruments, the right methods, the right steps, the right initiatives to raise growth," Hollande said.

Having rallied on Tuesday, European stocks dropped 2.2 percent as investors priced in a lack of dramatic policy intervention. The euro tumbled against the dollar to its lowest since August 2010 and Spanish and Italian borrowing costs climbed.

A German two-year debt auction gave a stark illustration of how money is dashing for safe havens. Investors snapped up the 4.5 billion euros of paper on offer even though it came with a zero coupon - offering no return at all.

As well as exploring ways to foster growth, the leaders will assess how to stabilize their banking systems, particularly Spain's which is laden with bad debts from a property boom that bust and still has some way to go before it touches bottom.

One proposal on the table is for the euro zone's rescue funds to be allowed to recapitalize banks directly, rather than having to lend to countries for on-lending to the banks.

But that is another idea with which Germany is uncomfortable.

"The top priority is injecting liquidity into the European financial system to ensure that European banks, all European banks, can be consolidated," Hollande said.

SEARCH FOR GROWTH​

With the euro zone registering no growth in the first quarter of the year and threatening to slip back into recession, the formal summit agenda is jobs and growth, with policymakers touting three ideas they hope will provide near-term stimulus:

- 'Project bonds' backed by the EU budget to finance infrastructure projects alongside private sector investment.

- Doubling the paid-in capital of the European Investment Bank, the EU's co-financing arm, to a little over 20 billion euros.

- Redirecting structural funds which tend to flow to poorer countries, to other areas where they might reap more immediate growth rewards.

Even if all three proposals were to be activated quickly economists and analysts say they will not provide a sufficient shot in the arm to the euro zone and the wider EU economy.






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Risk of Greece leaving euro 'very real'

on 23/05/2012 22:07:02
The former Greek Prime Minister, Lucas Papademos has said the risk of Greece leaving the euro is "very real."

His comments come as EU Leaders meet in Brussels tonight to discuss the possibility of Greece leaving the single currency, and to come up with new ways to grow the economies of member states.

This meeting is seen as a precursor to a full leaders summit next month.

http://news.eircom.net/breakingnews/20534234/?view=Standard

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Israel:
If this is the game Turkey wants, we'll play

Published: 05.23.12, 20:45 / Israel News
http://www.ynetnews.com/articles/0,7340,L-4233507,00.html​

Diplomatic sources stressed Wednesday that no official information had been received about an announcement by Turkey that it planned to indict former IDF commanders over the Marmara affair, but said "If it's true, this won't bring us to a good place. We will need to weigh our steps."

"We also have ways to bother them in the international arena. If this is the path they want, we also know what to do. They have plenty of Achilles' heels. We don't want escalation, but if this is the game – we'll play," the sources said. (Attila Somfalvi)






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Report:
Turkey indicts Israeli commanders over ship raid

Published: 05.23.12, 13:30 / Israel News
http://www.ynetnews.com/articles/0,7340,L-4233224,00.html​

A Turkish prosecutor has prepared an indictment seeking life sentences for four former Israeli military commanders over their alleged involvement in the 2010 killing of nine Turks on a Gaza-bound aid ship, Turkish newspaper Sabah reported on Wednesday.

The 144-page indictment, it said, had been prepared after testimony from some 600 people, including 490 passengers from the six-ship flotilla and relatives of those who had died. (Reuters)






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Military Expert:
More IDF Multi-Front Operations Likely

An Israeli military expert says the likelihood is growing
that Israel will need to launch more multi-front operations.

By Chana Ya'ar
First Publish: 5/23/2012, 9:28 PM
http://www.israelnationalnews.com/News/News.aspx/156136​

An Israeli military expert says the likelihood is growing that Israel will need to launch more multi-front operations.

Israel Air Force Headquarters Chief Brigadier General Hagai Topolansky told a national security conference Tuesday the Jewish State is likely to extend its operations beyond its borders as well.

"In the 80s and 90s we operated to deal with situations in places as far away as Iraq,” Topolansky told the audience at the Fisher Institute in Herzliya.

"In the past decade, we went as far away as Iran,” he added. “I hope [our operations] won't have to be extended any farther [than that].”

Earlier this month, the IDF issued call up orders for six battalions to guard the Egyptian and Syrian borders, with authorization for more if needed.

The orders were approved by the Knesset Foreign Affairs and Defense Committee as part of a request to call up as many as 22 battalions. A military spokesperson said the call up came following intelligence assessments calling for increased deployment of more troops.

Israeli defense personnel are also closely watching Lebanon as loyalists to the regime of Syrian President Bashar al-Assad clash with anti-government factions in Lebanese territory.

The growing Syrian civil war has begun to carry over into neighboring Lebanon.

Pro- and anti-Syrian factions within the Lebanese population have been clashing in the streets of Tripoli.

Violence also began this week to spill over into the capital of Beirut for the first time as well, giving rise to speculation the guns might eventually be pointed at Israel. Thousands of refugees and Syrian Army deserters have poured into Lebanon, which is dominated by the Hizbullah terrorist organization and other pro-Syrian factions.

If Assad falls, as Israeli officials believe he will, the IDF may face Al Qaeda-linked fighters at the border near the Golan Heights. If the Hamas and Islamic Jihad terrorist organizations launch an attack on southern Israel, a second front will open -- as happened during the 2006 Second Lebanon War. Were the Palestinian Authority's ruling Fatah faction in Ramallah to launch a simultaneous attack in Judea, Samaria and Jerusalem, a third front would be added, and with that, a multi-front war against Israel could easily be sparked, possibly even with additional Arab nations joining in.






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The Flying Dutchman said:

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Report:
Turkey indicts Israeli commanders over ship raid

Published: 05.23.12, 13:30 / Israel News
http://www.ynetnews.com/articles/0,7340,L-4233224,00.html​

A Turkish prosecutor has prepared an indictment seeking life sentences for four former Israeli military commanders over their alleged involvement in the 2010 killing of nine Turks on a Gaza-bound aid ship, Turkish newspaper Sabah reported on Wednesday.

The 144-page indictment, it said, had been prepared after testimony from some 600 people, including 490 passengers from the six-ship flotilla and relatives of those who had died. (Reuters)





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Click to expand...

Well, Erdorgan's called the tune, but can he play the piper? There's no way the Israelis can stand for this. As for future such "protests", what's there to motivate the IDF from not considering very "expedient" options in dealing with them now with these incitements?

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Syria And Its Neighbors Are
Like Bombs Wired Together

By DAVID IGNATIUS Posted 05:47 PM ET
http://news.investors.com/article/612463/201205231747/tensions-grow-in-syria-and-its-neighbors.htm​

The Middle East sometimes resembles a string of detonators wired to explode together — and this seems especially true now of Syria and its neighbors.

There is political instability nearby in Iraq, Jordan and Lebanon, as the Arab uprising moves through its second year. In each of these countries, the leadership maintains power in a balancing act. Only Turkey, with its triad of a strong economy, army and political leadership, seems genuinely stable.

Fear of blowing up the region — and spawning even more Sunni-Shiite sectarian war — is one reason the Obama administration has refused to arm the Syrian opposition. Officials fear that militarizing the conflict, without reliable Syrian allies or a clear endgame strategy, could produce unintended consequences much like those of the Iraq War.

Administration officials expect Kofi Annan's peace plan will fail, but they don't want to give up on the former U.N. secretary-general's effort yet. Better to let the planned 300 U.N. observers travel in Syria, they reason, and perhaps encourage a new round of protest that would show that President Bashar Assad's rule is doomed.

What makes this period of Arab revolution so complicated is that the new themes of liberation, culminating in this week's Egyptian presidential election, are becoming interwoven with ancient ethnic hatreds. Analysts from Iraq, Jordan and Lebanon describe the growing tensions in each country, as these factors play out:

• Iraq's prime minister, Nouri al-Maliki, faces a possible breakup of his ruling coalition. The potential opposition has widened to include Moqtada al-Sadr, the Shiite militia leader, and Massoud Barzani, the Kurdish chieftain. Late last month, they threatened to dump Maliki unless he implemented a November 2010 power-sharing pact.

Sadr, the fiery cleric, was unusually blunt: "This state is under a form of dictatorship and we do not want it to remain under Premier Maliki." When Barzani visited Washington last month, he is said to have warned administration officials, "I can't live with another dictator in Baghdad." Yet Maliki is still in power, thanks partly to the bizarre fact that he enjoys support from both Washington and Tehran. Symbolically, perhaps, U.S. and Iranian negotiators agreed on Baghdad as the site for nuclear negotiations taking place this week.

The old expression "once bitten, twice shy" may explain the Obama administration's view of Iraq. The White House favors compromise with Maliki and the preservation of stability there, in part because it doesn't want to reignite civil war in Iraq at the same time it is spreading in Syria.

• Jordan's King Abdullah's reign has been one long balancing act, between Palestinians and East Bankers, between secular modernizers and Islamist conservatives. He has been lucky that all sides support the Hashemite monarchy, even as they quarrel over how to divide the spoils. But lately, the political jockeying has grown more intense.

The king has burned through four prime ministers in 15 months, without getting agreement on an election law and other reforms. Corruption scandals have taken down three intelligence chiefs in a row, to the point that many Jordanians wonder whether the deeper problem is in the palace itself. There is growing talk about Jordan as a staging ground for Syrian insurgents — which might please Saudi Arabia and other Sunni powers that want to overthrow Assad, but would add new risks for the king.

• Lebanon may be in the most delicate position of all. Under Prime Minister Najib Mikati, Lebanon's policy is "disassociation" from the Syria battle. But that middle ground is disappearing — with anti-Assad refugees using northeastern Lebanon as a sanctuary, triggering reprisals from pro-Assad forces.

An illustration of how the regional and sectarian strands come together is the case of Shadi Mawlawi, a Sunni activist supporting the anti-Assad opposition. He was arrested two weeks ago by the Shiite-led General Security service. According to a Lebanese official, evidence linked Mawlawi to a prominent Qatari who was funneling money to the rebels in Syria.

Mikati wants Washington's help in keeping Lebanon from being drawn deeper into the regional turmoil, but the longer the Syria fight goes on, the harder it will be for any of the neighbors to stay out.

One wild card that could trump everything else is tribal politics. Two big Sunni tribes, the Shammar and the Dulaim, stretch from northern Saudi Arabia through western Iraq and Jordan and up into Syria. Some observers say these tribes have sworn a blood oath against Assad. If so, a decisive phase of the Syrian war may have begun.











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The Flying Dutchman said:

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Military Expert:
More IDF Multi-Front Operations Likely

An Israeli military expert says the likelihood is growing
that Israel will need to launch more multi-front operations.

By Chana Ya'ar
First Publish: 5/23/2012, 9:28 PM
http://www.israelnationalnews.com/News/News.aspx/156136​

An Israeli military expert says the likelihood is growing that Israel will need to launch more multi-front operations.

Israel Air Force Headquarters Chief Brigadier General Hagai Topolansky told a national security conference Tuesday the Jewish State is likely to extend its operations beyond its borders as well.

"In the 80s and 90s we operated to deal with situations in places as far away as Iraq,” Topolansky told the audience at the Fisher Institute in Herzliya.

"In the past decade, we went as far away as Iran,” he added. “I hope [our operations] won't have to be extended any farther [than that].”

Earlier this month, the IDF issued call up orders for six battalions to guard the Egyptian and Syrian borders, with authorization for more if needed.

The orders were approved by the Knesset Foreign Affairs and Defense Committee as part of a request to call up as many as 22 battalions. A military spokesperson said the call up came following intelligence assessments calling for increased deployment of more troops.

Israeli defense personnel are also closely watching Lebanon as loyalists to the regime of Syrian President Bashar al-Assad clash with anti-government factions in Lebanese territory.

The growing Syrian civil war has begun to carry over into neighboring Lebanon.

Pro- and anti-Syrian factions within the Lebanese population have been clashing in the streets of Tripoli.

Violence also began this week to spill over into the capital of Beirut for the first time as well, giving rise to speculation the guns might eventually be pointed at Israel. Thousands of refugees and Syrian Army deserters have poured into Lebanon, which is dominated by the Hizbullah terrorist organization and other pro-Syrian factions.

If Assad falls, as Israeli officials believe he will, the IDF may face Al Qaeda-linked fighters at the border near the Golan Heights. If the Hamas and Islamic Jihad terrorist organizations launch an attack on southern Israel, a second front will open -- as happened during the 2006 Second Lebanon War. Were the Palestinian Authority's ruling Fatah faction in Ramallah to launch a simultaneous attack in Judea, Samaria and Jerusalem, a third front would be added, and with that, a multi-front war against Israel could easily be sparked, possibly even with additional Arab nations joining in.






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Click to expand...

And that doesn't even explore what a Muslim Brotherhood government in Cairo will mean in such a situation, never mind Iranian involvement.

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Saudi king warns of
Lebanon civil war threat

Abdullah's letter to Sulaiman
follows killing of anti-Al Assad cleric

Gulf News Report
Published: 00:00 May 24, 2012
http://gulfnews.com/news/gulf/saudi-arabia/saudi-king-warns-of-lebanon-civil-war-threat-1.1027164​

Dubai: Saudi Arabia's King Abdullah Bin Abdul Aziz is "deeply concerned" about the sectarian violence in Lebanon, state news agency SPA said, in an apparent reference to the killing of a Lebanese Sunni cleric opposed to Syrian President Bashar Al Assad.

"Saudi Arabia is deeply concerned and is following up on the recent developments of Tripoli events, especially the targeting of a main sect in the country's social fabric," Saudi state news agency SPA cited King Abdullah as saying in a letter to Lebanese President Michel Sulaiman.

"Due to the gravity of the crisis and the possibility of it causing sectarian strife in Lebanon and putting it back in the shadow of the civil war, we are looking at your ... attempts to interfere to end the crisis... and keeping Lebanon away from foreign struggles especially with the Syrian crisis nearby," the letter said.

Violence linked to the Syria conflict has spilled over into Lebanon, where soldiers last Sunday shot dead a prominent Sunni cleric and a member of a Lebanese political alliance against Al Assad in the northern city of Tripoli.

Saudi Arabia has long viewed Al Assad's government with distrust, pointing to its alliance with Shiite Iran, which Riyadh suspects of stirring up unrest in neighbouring Bahrain and among its own Shiite minority.

Riyadh has led Arab efforts to isolate Al Assad's government in an attempt to end its suppression of a year-long revolt and has called for Syrian rebels to be armed.

The UAE, Bahrain, Qatar and Kuwait have urged their citizens to stay away from Lebanon, citing security concerns.

Kidnapping​

Lebanese Foreign Minister Adnan Mansour said yesterday that Lebanese Shiites allegedly kidnapped in northern Syria by insurgents hoping to trade the captives for detainees in Syrian government custody would be freed soon.

The rebel Free Syrian Army denied it was behind the kidnapping.

Meanwhile, the Syrian rebel bastion Rastan was heavily shelled yesterday and at least 12 people were killed across the country, according to monitors.

Syrian forces tried to storm Rastan under cover of heavy gunfire, shelling and rocket bombardment, reports said.

Soldiers are trying to overrun Rastan for the second time in 10 days, with shells crashing into the town at the rate of "one a minute" at one stage, according to a Britain-based watchdog.

An activist told AFP that Free Syrian Army fighters were defending Rastan's entrances, but that "regime forces are being strengthened with new deployments", including from the elite Republican Guard.

"Electricity has been cut off in Rastan, and water tanks have been shelled," said activist Abu Rawan. "There is also a severe lack of food because the market is closed and we can't bring food in from nearby villages."

Syria oil sector lost $4b​

Syrian Oil Minister Sufian Allawi yesterday admitted that punitive measures imposed by the West have cost the country almost $4 billion and caused shortages in fuel products.

"The oil sector has lost almost $4 billion because of the unjust European and US sanctions, blocking exports and imports of oil and oil derivatives," he said. The minister acknowledged "new difficulties" in meeting Syria's energy needs, especially for domestic gas. "The measures taken by the EU and United States are behind this crisis. They want to put pressure on the Syrian people by widening the embargo," he said, adding: "We will also overcome the new difficulties."

Allawi said negotiations were under way with Russia for a long-term energy deal, while a Venezuelan vessel loaded with 35,000 tonnes of fuel oil docked in Syria this week and another was expected shortly.






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For links see article source....
Posted for fair use....
http://www.hurriyetdailynews.com/ku...-pkk-.aspx?pageID=238&nID=21446&NewsCatID=419

Kurdish oil, the pipeline, and the PKK

Kurdistan Regional Government (KRG) Prime Minister Necirvan Barzani paid a visit to Ankara last week. The Turkish government showed him great hospitality, because there were a lot of issues on the table. For example, the outlawed Kurdistan Workers’ Party (PKK) issue, Baghdad, Iran, Syria, economic relations and, most importantly, oil. Although the priorities of both sides differ, oil is the top issue.

Minister of Energy Taner Yıldız wasted no time and flew to Erbil to attend an energy conference there, which proves how vital the issue is.

At the conference, KRG Energy Minister Hawram’i said “In August 2013, we will be able to directly export crude from the Kurdish Region’s oilfields.” Apparently the KRG wants to export oil directly to the market, bypassing Baghdad. Turkey has been strongly supporting this project. From a broader perspective, it could be said that the U.S. is also supportive of this initiative.

Lessons learned have taught us that pipeline construction always triggers important and interesting developments. Turkey’s recent experience supports this argument.

The Kirkuk-Yumurtalık pipeline was opened in April 1984, in the middle of the Iran-Iraq War. It is interesting to note that the PKK made its systematic first attack on Aug. 15 of the same year. We have learned from the PKK’s documents that it failed to carry out its planned attack for the pipeline’s opening day, as the preparations had not been completed. And it was Syria, Iran and Soviet Russia who planned this attack, with the aim of sabotaging Saddam’s resources for maintaining his war. Since that date, the PKK has made hundreds of attacks at that spot in the last 3 decades.

The other pipeline is the Baku-Tiblisi-Ceyhan pipeline. The PKK was also on the stage during this project. Responding to demands from Iran and Russia, it increased its attacks and delayed the pipeline’s construction for 10 years. The PKK was trapped and ended up with considerable casualties, which led it to declare a cease-fire in Sept. 1992. The government covertly complied with this. At that time, the Baku-Tibilisi-Ceyhan pipeline agreement was about to be signed but this failed. The PKK broke off its commitments and started attacking, killing 33 unarmed soldiers. Afterward, it shifted its attacks to the pipeline route as Iran opened its border. Was it a coincidence that in those days, the Turkey-Russia and Turkey-Iran pipeline agreements were signed and the pipeline constructed? The Baku-Tibilis-Ceyhan pipeline project was delayed, its route was changed, and it became a reality only after Saddam’s arrest.

Russia has always been an active actor on pipeline issues. In 2008, shortly before Russia’s attack on Georgia, the PKK blew up the pipeline at Erzincan, thus proving its loyalty to the cooperation and the orders. Was this also a coincidence?

The follow-up decisions made by Turkey and the KRG will trigger interesting developments in the region. When we look at the big picture involving the Arab Spring, Syria, the Iran and Iraq crises, and Russia, which would not like to lose its indispensable customer, Turkey, the PKK seems likely to take a place in the picture.

May/24/2012

For links see article source....
Posted for fair use....
http://www.thenewstribe.com/2012/05/24/eight-killed-in-attacks-across-iraq/#.T71j01IuiSo

Eight killed in attacks across Iraq

By Areeb Hasni - May 24th, 2012 (No Comment)

Iraq: At least eight people were killed and 33 others wounded in recent attacks across Iraq as the country hosted key nuclear talks in its latest effort to emerge from decades of isolation, media reported on Wednesday.

According to reports three people were killed and 14 wounded in a shooting and three roadside bombings in Baquba, capital of Diyala province north of the capital.

And a roadside bomb exploded near a bus carrying Lebanese Shiite pilgrims near Ramadi, capital of Anbar, a Sunni Arab province west of Baghdad, killing three and wounding 10 others, police and medical sources said.

Iraq is home to some of the holiest sites in Shiite Islam, to which hundreds of thousands of pilgrims flock each year. Pilgrims have come under repeated attack by Sunni insurgents, often with bombs.

Two policemen were killed and five wounded in attacks in the northern oil hub of Kirkuk, capital of a province that Kurdish leaders want to incorporate into their autonomous region in northern Iraq, against Baghdad’s wishes.

“Unknown gunmen attacked the house of a high-ranking police officer, killing a police guard,” report added.

And two roadside bombs targeting a police patrol wounded three policemen in the city, while one policeman was killed and two wounded by a magnetic “sticky bomb” on their vehicle, the officer said.

Despite heightened security measures in and around the Iraqi capital, four people were wounded by a roadside bomb near a Sunni mosque in Al-Yarmuk, west Baghdad, an interior ministry official said.

Thousands of additional Iraqi security personnel have been deployed in areas north, west and south of Baghdad to try to prevent the firing of mortars and rockets into the capital, a security official said.

The official also said without providing figures that additional forces have been deployed at checkpoints in the Iraqi capital, and that searches have been increased.

Major powers were holding talks with Iran in Baghdad on Wednesday, aiming to head off an escalating standoff over Tehran’s nuclear programme.

The talks are the latest example of Iraq pushing to host world events and present itself as a relatively stable country no longer rife with violence, but its attempts have so far yielded uneven results.

While violence is down from its peak in 2006 and 2007, attacks remain common, killing 126 people in April, according to official figures.

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'Boiling point':
On Lebanon's Syria Street, a civil war brews

Syria's chaos has come over the border into Lebanon, with
gunmen clashing in deadly street battles. NBC's John Ray reports.

By John Ray, NBC News
http://worldnews.msnbc.msn.com/_new...-on-lebanons-syria-street-a-civil-war-brews?=​

TRIPOLI, Lebanon – It only takes a two-minute stroll down Syria Street to see why so many people are so worried about what might happen next in Lebanon.

--------------------------------------------------------------------------------

Syria Street is the aptly named thoroughfare that separates rival factions in Lebanon’s second city.

For much of the past week, the two sides have been waging a mini-civil war.

It is a direct spill over from the chaos in neighboring Syria.


“President Assad is trying to destroy us,” says Sheik Bilal Masri, by way of explanation. “They cause trouble here to take the pressure off them in Damascus.”


Since the Syrian crisis broke out, the price of weapons has exploded in neighboring Lebanon. ITN's John Ray meets the rebels buying the weapons and the dealers selling them.

We meet a small group of his men. They are well-armed and apparently spoiling for a fight.

Not many yards away, posters of Syria’s President Bashar Assad striking stern military poses adorn walls on the other side of the street.

Here the people share Assad’s Alawite faith and, it seems, the same determination to defend his regime.


“No one wants a civil war in Lebanon,” a local Alawite leader tells me. “But everyone should be warned: There will be repercussion for anyone who tries to meddle in Syria.”

Conflict along Syria Street is nothing new. But the outside world began to take notice on Monday when for the first time in four years, gun battles broke out on the streets of Lebanon’s capital, Beirut.

It was a brief glimpse back into the abyss for a nation scarred by years of civil strife.

Inside Syria rebel stronghold: 'The city is on mute'

In 2005, Syrian troops were forced to withdrawal from Lebanon, but Damascus is still a big player in the fractured politics of a country that sees rival Muslim and Christian sects share power in a set of uneasy alliances.

Syria’s most powerful friend here is Hezbollah, the militant Shiite group that probably holds the key to whether Lebanon survives in one piece.

Its heartland in the south of Beirut has been tense, but so far its leader, Hassan Nasrallah, has kept his forces out of the fray.

But for how long?​

The fatal shooting of two Sunni clerics followed by the kidnapping of Lebanese Shiite pilgrims in Syria shows how unpredictable events have become.

A message to Assad? War games held near border

For more than two decades, Timur Goksel has watched events in Lebanon. Once of the U.N. Mission here, he now lectures at the American University in Beirut.

He tells me the country has rarely felt so dangerous.

“I hope I am wrong because this is scary. If the faction leaders lose control of these young guys with the guns then we’re in trouble,” he said.

Their bloody history has taught the Lebanese to be a fatalistic people.

“The country is at boiling point,” another seasoned observer told me with a shrug. “What is coming will be very bad.”





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Iran nuclear talks snag over dueling demands

Published: Wednesday, May 23, 2012
By The Associated Press

BAGHDAD — Iran and six world powers exchanged dueling proposals Wednesday in a tug of war over Tehran's nuclear program that pits international concerns about the Islamic Republic's potential to build atomic weapons against enforcing crippling sanctions on its people.

The daylong back-and-forth in Baghdad focused largely on whether the current enrichment level of Iran's uranium production is a red line the U.S. and other powers will not permit for fear it could become warhead-grade material.

At stake is the threat an Iran armed with nuclear weapons could pose to its neighbors. The U.S. and Israel have indicated readiness to attack Iran if diplomacy and sanctions fail to curb its nuclear program. Both suspect that Iran is aiming to build nuclear weapons, and Israel believes it would be a prime target.

Iran insists its nuclear program is peaceful.

Western negotiators in Baghdad presented a package combining new and old proposals offering Iran medical isotopes, some nuclear safety cooperation and potentially spare parts for civilian airliners. In exchange, Tehran would stop its 20 percent enrichment levels as a first step, according to a Western diplomat involved in the talks. The diplomat spoke on condition of anonymity to discuss the negotiations more candidly.

Iran brought a potent bargaining chip to the table, tentatively agreeing on the eve of the negotiations to allow U.N. inspectors into a military complex suspected of conducting nuclear arms-related tests.

The gesture was an attempt to head off painful July 1 sanctions on its oil exports to lucrative European markets. U.S. and European measures have targeted Iran's oil exports — its chief revenue source — and effectively blocked the country from international banking networks.

But diplomats from the six world powers refused to considered the sanctions as a relevant part of the impasse.

A member of Iran's negotiating team, who spoke on condition of anonymity to discuss the sensitive talks, predicted negotiations would continue Thursday. Talks continued late into the night on their first day.

The talks are seen only as a small step forward in a delicate negotiating process that likely will unfold over months. That would likely bring objections from Israel, which claims that Iran is only trying to buy time to keep its nuclear fuel labs in full operation.

A delay could allow U.S. and European allies to tone down threats of military action — despite calls Wednesday from a hawkish alliance of U.S. senators who urged negotiators to take a hard line against Iran "to leave no doubt that the window for diplomacy is closing."

"The Iranian regime's long record of deceit and defiance should make us extremely cautious about its willingness to engage in good-faith diplomacy," Republican Sens. John McCain and Lindsey Graham, and Independent Joe Lieberman, wrote in Wednesday's editions of The Wall Street Journal. "The U.S. must be prepared, if necessary, to use military force to stop Iran from getting a nuclear-weapons capability."

The Baghdad meetings opened with the so-called 5+1 group — the permanent U.N. Security Council members, the United States, Russia, China, Britain and France, plus Germany — putting forward a proposal apparently aimed at reining in Iran's highest-level uranium enrichment. Many world leaders fear the uranium, enriched to 20 percent, could quickly be turned into weapons-grade material. Other details of the plan were not immediately disclosed.

"We hope the package that we put on the table is attractive to them so they will react positively," Mike Mann, spokesman for the head of the European Union delegation that is leading the talks, told reporters. "It's up to them to react."

He also suggested that any rollback in sanctions was unlikely in the Baghdad talks, calling them a "matter of the law and they will come into force when they come into force."

Hours later, Iran put forth a counterproposal that includes "nuclear and non-nuclear issues," according to the member of its negotiating team. The official would not discuss details of the plan but said it was to be discussed in private meetings with diplomats from the European Union and China, an Iranian ally.

Iran's top officials, including Supreme Leader Ayatollah Ali Khamenei, have repeatedly said that Iran does not seek nuclear arms and have called such weapons against Islamic principles.

During a visit to western Iran on Wednesday, President Mahmoud Ahmadinejad evoked Khamenei's belief that "production and use of weapons of mass destruction is forbidden" by Islam.

"There is no room for these weapons in Iran's defense doctrine," he said at a gathering to commemorate victims of Iraqi chemical weapons during the 1980-88 war with Saddam Hussein's Iraq.

Even so, Iran is sticking to its right to enrich uranium as a signatory of U.N. nuclear treaties. The high-enriched uranium is far above the level needed for energy-producing reactors, but is used in medical research. Iran claims its nuclear program is only for electricity and medical applications.

Earlier this week, Tehran tentatively agreed to allow the U.N. International Atomic Energy Agency inspect the Parchin military complex southeast of Tehran. That's where the U.N. believes Iran ran explosive tests in 2003 needed to set off a nuclear charge. Tehran says Parchin is not a nuclear site.

Mann expressed cautious optimism about the still-unsigned deal but said it would have little bearing on Wednesday's talks. In Washington, White House spokesman Jay Carney lauded it as a positive step forward, "but we judge Iran by its actions, not by its promises."

The Iranian envoys entered the talks sorely wanting to lessen, or at least delay, an EU decision to cut all crude oil imports from Iran that are set to take effect July 1. The 27-nation EU accounts for just 18 percent of Iran's total oil exports.

Earlier this week, the U.S. Senate backed proposals for further sanctions on Iran, including requiring companies listed on U.S. stock exchanges to disclose any Iran-related business. U.S. and European measures already have targeted Iran's oil exports — its chief revenue source — and effectively blocked the country from international banking networks.

Oil fell to a seven-month low near $91 a barrel Wednesday on hopes of progress in the talks.

If the July 1 sanctions start as planned, Iran's Economy Minister Shamseddin Hossein predicted they will backfire, warning this week that Europe should expect a crude oil price of $160 a barrel should the embargo remain in place.

That puts a ticking clock on a negotiations process that, for all its bluffing and brinksmanship, may drag on "for several weeks, if not for several months," said Bruno Tertrais, senior research fellow at the Foundation for Strategic Research in Paris.

"There will be incentives to not rush toward any kind of deal," Tertrais said.

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Hezbollah appeals for calm

Ap
Thursday, May 24, 2012
http://www.fijitimes.com/story.aspx?id=202121​

BEIRUT - The leader of Lebanon's Shi'ite militant group Hezbollah has appealed for calm after people blocked roads and burned tyres in Beirut to protest the kidnapping of 11 Lebanese Shi'ites in neighbouring Syria.

The abductions in Syria's northern Aleppo province threatened to ignite dangerous sectarian tensions and fuelled fears that Lebanon is getting drawn into the chaos next door.

The Lebanese were on their way home from a religious pilgrimage in Iran when Syrian rebels intercepted their vehicles, Syria's state-run SANA news agency said. The rebels abducted the 11 men and a Syrian driver. The women were released.

Lebanese security officials confirmed the kidnapping.​

As the news of the kidnappings spread, residents of the southern suburbs of Beirut, a Shi'ite area, took to the streets and burned tyres and blocked roads in protest. The leader of Hezbollah, a strong ally of the Syrian regime, appealed for calm and warned his followers against revenge attacks targeting Syrians.

"This is strictly prohibited," Sheik Hassan Nasrallah said in a televised speech.

He said the Lebanese government must press for the pilgrims' release. "We will work day and night until these beloved people are with us," Nasrallah said.

Hezbollah has stood by Syrian President Bashar Assad as he struggles to put down a 15-month-old uprising.

Sunnis form the backbone of the Syrian revolt, which has unleashed boiling sectarian tensions. Assad and the ruling elite in Syria belong to the tiny Alawite sect, an offshoot of Shiism.





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http://uk.reuters.com/article/2012/05/23/usa-treaty-seas-idUKL1E8GNGJX20120523

Obama officials press Senate to ratify sea treaty

Wed May 23, 2012 10:59pm BST

* Failure to act raises risks of confrontation- Dempsey

* Clinton, Panetta cite huge economic benefits

* Opponents worry about lost sovereignty, royalty payments
By David Alexander

WASHINGTON, May 23 (Reuters) - Washington's failure to ratify the Law of the Sea Convention puts the U.S. military at increasing risk of confrontation with rising powers like China, U.S. officials said on Wednesday as the Obama administration began a new push to join the 30-year-old treaty.

Senior defense officials told the Senate Foreign Relations Committee that without the treaty, the U.S. military is forced to base rights of navigation around the globe on customary international law, or long-standing practice, wh i ch is subject to differing interpretations.

"If we do not ratify over time, what would happen is that we put ourselves at risk of confrontation with others who are interpreting customary international law to their own benefit," said General Martin Dempsey, chairman of the Joint Chiefs of Staff.

"If we are not a party to this treaty and can't deal with it at the (negotiating) table, then we have to deal with it at sea with our naval power," Defense Secretary Leon Panetta said. "And once that happens, you clearly increase the risk of confrontation."

The 1982 treaty, which has been ratified by more than 160 countries, establishes 12-nautical-mile (22-km) territorial seas around coastal countries but ensures rights of navigation and overflight by other states. Twice in the past decade, the treaty was voted out of committee but never made it to a vote by the full U.S. Senate.

Opponents of the treaty are concerned it would cede U.S. sovereignty to an international organization that would have the power to collect royalties on oil and mineral exploitation and use the funds to help poorer countries.

Panetta and Secretary of State Hillary Clinton told the panel the convention would bring huge economic and military benefits to the country. But the issue quickly ran into the same objections that have stymied its passage since the mid-1990s.

"My problem is with sovereignty," Republican Senator Jim Risch said, flipping through the pages of the treaty. "There's 288 pages here, and as you read it, there's some good stuff in here. But if we have to give up one scintilla of sovereignty that this country has fought, has bled for ... I can't vote for it."

Proponents say the benefits far outweigh any drawbacks, citing support by groups as diverse as the Chamber of Commerce, Greenpeace, members of the oil and gas industry, top U.S. military officials and recent Republican and Democratic administrations.

'IMMEDIATE BOOST TO U.S. CREDIBILITY'

The accord creates 200-nautical-mile (370-km) exclusive economic zones that give coastal states rights of development and exploitation of natural resources but protect the ability of other countries to navigate, overfly and lay communications cables across the regions.

The treaty also grants countries rights to continental shelf regions beyond the 200-mile economic zones.

Because of its extensive coastal regions, the United States stands to benefit more than other countries by joining the treaty, proponents say. It would extend U.S. sovereignty to vast areas of the ocean, while putting the military's worldwide rights of navigation or firmer legal footing.

Lawmakers and defense officials said the treaty would strengthen the military's hand in dealing with growing powers like China and Russia and others that have joined the convention and are seeking to establish claims in the Pacific and Arctic.

"China and other countries are staking out illegal claims in the South China Sea and elsewhere," said Democratic Senator John Kerry, chairman of the Foreign Relations Committee.

"Becoming a party to the treaty would give an immediate boost to U.S. credibility as we push back against excessive maritime claims and illegal restrictions on our warships or commercial vessels," he said.

China claims rights over most of the South China Sea, which has led to confrontations with the Philippines, Vietnam and other countries bordering the waterway.

The U.S. military has had repeated run-ins in the region with Chinese vessels and aircraft asserting their sovereignty, including a midair collision in 2001 that killed a Chinese jet pilot and forced a U.S. Navy reconnaissance plane to make an emergency landing on China's Hainan Island. (Reporting by David Alexander; Editing by Peter Cooney)

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http://uk.reuters.com/article/2012/05/23/uk-russia-usa-missiles-idUKBRE84M1EM20120523

Russia tests new missile, in warning over U.S. shield

By Steve Gutterman

MOSCOW | Wed May 23, 2012 9:31pm BST

(Reuters) - Russia tested a new long-range missile on Wednesday that should improve its ability to penetrate missile defence systems, the military said, in Moscow's latest warning to Washington over deployment of a missile shield in Europe.

The Intercontinental Ballistic Missile (ICBM) was successfully launched from the Plesetsk facility in north-western Russia and its dummy warhead landed on target on the Kamchatka peninsula on the Pacific coast, the Defence Ministry said.

The new missile is expected to improve Russia's offensive arsenal, "including by increasing the capability to overcome missile defence systems that are being created", the ministry said in a statement.

Russia opposes a missile shield the United States and NATO are deploying in Europe, saying it will be able to intercept Russian warheads by about 2018, weakening Moscow's nuclear arsenal and upsetting the post-Cold War balance of power.

The United States says the system is intended to counter a potential threat from Iran and poses no risk to Russia, but the Kremlin has rejected those assurances and stepped up criticism of the system, to be deployed in four phases by about 2020.

Last autumn, then-President Dmitry Medvedev outlined steps Russia was taking to neutralise the perceived threat, including upgrades to Russia's offensive nuclear arsenal.

Russia and the United States are still in talks to agree cooperation on missile defence, but Moscow has warned of further measures if no such deal is reached and Washington refuses to provide binding guarantees its system will not threaten Russia.

At a conference in Moscow this month, senior General Nikolai Makarov said Russia could carry out pre-emptive strikes on future NATO missile defence installations to protect its security.

The European system is to include interceptor missile installations in Poland and Romania and a radar in Turkey as well as interceptors and radars on ships based in the Mediterranean Sea.

Russia usually names its weapons, but the Defence Ministry made no mention of a name for the new missile. It said it could be fired from a mobile launcher.

Missile defence has troubled ties between Russia and the United States since the Cold War.

The dispute over the current project has developed despite President Barack Obama's decision in 2009 to scrap the previous administration's plans for longer-range interceptors, which helped improve relations after a period of growing tension.

Western officials say improvements to Russia's ICBM arsenal undermine Moscow's argument that the system will present a threat and suggest the Kremlin wants to use the issue as a bargaining chip in broader talks on nuclear arms cuts.

During his 2000-2008 Kremlin term, President Vladimir Putin repeatedly said Russia would improve its offensive nuclear capability in response to U.S. missile defence plans.

In 2007, First Deputy Prime Minister Sergei Ivanov, now Putin's chief of staff, was quoted by Russian news agencies as saying Russia already had weapons that could overcome any current or future missile defence system.

(Writing by Steve Gutterman; editing by Andrew Roche)

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http://www.chinapost.com.tw/china/national-news/2012/05/24/342105/China-cancels.htm

Updated Thursday, May 24, 2012 0:03 am TWN, AFP

China cancels high-level military trip to Japan over islands, Uyghur meeting

BEIJING -- China said Wednesday it has cancelled a high-level military trip to Japan, as the two neighbors bicker over a disputed island chain and a recent Uyghur symposium in Tokyo that angered Beijing.

Guo Boxiong, vice chairman of the powerful Central Military Commission and China's highest ranking military officer, will not visit Japan due to “work commitments” at home, the defense ministry said in a statement.

According to the China Daily, the visit had been due to begin Thursday, with Guo scheduled to meet Japanese Prime Minister Yoshihiko Noda.

The cancellation comes after China condemned Japan for allowing the World Uyghur Congress, which Beijing considers an exiled “anti-China” separatist grouping, to hold a meeting in Tokyo last week.

Uyghurs are a predominantly Muslim ethnic minority who mainly live in western China's Xinjiang region and have long chafed under Beijing's rule.

In April, Beijing also angrily condemned remarks by Tokyo Governor Shintaro Ishihara, who re-ignited a long-simmering maritime territorial dispute by vowing to purchase a group of uninhabited islands at the centre of the row.

Ishihara, an outspoken critic of Beijing who has made a career out of provocative nationalistic remarks, said he had approached the owner of the islands in the East China Sea, called Senkaku in Japan and Diaoyu in China.

In 2010, relations between China and Japan hit a low point after Japanese authorities arrested a Chinese captain for ramming his trawler against Japanese Coast Guard ships in the disputed area near the islands.

Despite their numerous political rows, China and Japan remain vigorous trading partners. Leaders of the two nations recently agreed to begin free trade negotiations that will also include South Korea.

Naoki Tanaka, Japan's defense minister, said Chinese authorities had told him Guo Boxiong's visit was postponed due to a work commitment, adding that he hoped to the trip could be rescheduled.

“I hope to have a high-level meeting as soon as possible, and I believe they understand the need for such a meeting,” Tanaka told reporters at a regular news briefing in Tokyo.

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Philippines Gets Support From Japan, Others Against China

By IBTimes Staff Reporter: Subscribe to IBTimes's RSS feed

May 23, 2012 5:35 PM EDT

The Philippines is getting some help in its maritime dispute with China.

Other countries in the Asia-Pacific region may soon offer ships to support Manila in the standoff, now more than a month old, over Scarborough Shoal, known as Huangyan Island in China and Panatag Shoal in the Philippines.


(Photo: Global Times)
A 1000-ton Japanese coast guard cutter, of the Shiretoko-class. The ship may soon find a new mission, serving to defend the Philippines.

Japan may loan a fleet of 10 coast guard ships to the Philippines as part of its Official Development Assistance package to Manila. The Global Times, a Chinese nationalistic publication, says the deal includes 10 small 180-ton patrol boats as well as two larger, nearly 1000-ton cutters.

The new development is already creating a backlash in Beijing, which has stated that it is vehemently opposed to involvement by any third party in its quarrel with Manila.

Information from the Japanese government has been scant. The Korean Broadcasting Service, South Korea's largest television network, ran a story on the transfer of the ships on March 22, quoting Japanese economic news agency Nihon Keizai Shimbun as a source. That was three weeks before the recent scuffle between China and the Philippines began. Therefore, the transfer of the ships would not be directly related to the current standoff.

Must Read

Japanese ShipsPhilippines Gets Support From Japan, Others Against China


However, Japan's Mainichi Shimbun news service said that only an informal discussion between foreign and defense ministries of the two countries had taken place in Manila on March 22. The Embassy of Japan to the Philippines told the Filipino press last Friday that its government "is still considering whether to include" the ships in its aid package for the Philippines.

The Chinese press has been quick to jump on the issue, depicting it as collusion between its opponents in the South China Sea and Japan. Many inside the country see the deal -- if signed, it would be the first made after Japan's relaxing of its "Three Principles on Arms Exports," which renounced exporting weaponry -- as an indication that Japan intends to shore up China's adversaries with arms transfers.

The Philippine government also received as second Hamilton-class cutter from the U.S. Coast Guard on Wednesday, in an official transfer ceremony in North Carolina. The first Hamilton-class cutter received by Manila, redubbed the Gregorio del Pilar in Filipino navy service, was the ship that originally intercepted Chinese fishing vessels at the disputed shoal on April 10.

However, like the first, the new ship will not be outfitted with a full complement of weapons.

The commander of the Philippine Coast Guard, Vice Adm. Edmund Tan, said last Saturday that the Japan deal was still awaiting approval by his government's National Economic and Development Authority.

Philippine Foreign Minister Albert del Rosario said Manila was also receiving aid from South Korea and Australia to help the country develop a "minimum credible defense posture." Those assistance programs may include training and arms sales.

Chinese media say that the Philippines has already spent $395 million on upgrading and building its military since 2010, a vast increase over the previous 15 years, when it averaged $50 million a year.

But defense analysts will be quick to point out that the figure is insignificant compared to China's official defense spending of more than $100 billion over the next year. Much of the existing Filipino fleet is antiquated; even the new Filipino ships from the U.S. are hand-me-downs nearly half a century old. Meanwhile, China is quickly boosting an already fast rate of naval development. Beijing plans to build 36 new coast guard vessels by 2014.

Japan's assistance to the Philippines will create further frictions in its relations with China, which have already been damaged this year over their own disputes. Japan's recent hosting of the World Uyghur Congress in Tokyo angered China, which considers the Uyghur movement a separatist group. Continuing nationalistic disagreements related to ownership of the Senkaku / Diaoyu islands have led to further bilateral cooling.

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http://www.reuters.com/article/2012/05/23/iran-nuclear-usa-idUSL5E8GNFKV20120523

UPDATE 1-Iran talks show common ground, disagreement-US

Wed May 23, 2012 6:48pm EDT

(Adds quotes, background)

May 24 (Reuters) - A first day of talks between Iran and world powers about a nuclear programme that the West suspects is aimed at nuclear bomb research showed a "fair amount of disagreement" but also areas of common ground, a senior U.S. official said.

"I believe we have the beginning of a negotiation," the official said of the talks, which opened on Wednesday and lasted late into the evening. "But still we have to come to closure...about what are the next appropriate steps."

Iran was "engaged" in the discussions, and the meeting would continue into a second day on Thursday, the official said, adding that there was "plenty to go on" for a potential further round of talks.

Earlier on Wednesday, envoys for Iran and the United States, Russia, China, France, Britain and Germany exchanged unusually detailed proposals at the talks in Baghdad in hopes of defusing a long standoff over suspicions Tehran's atomic energy programme may be a disguised quest for nuclear weapons.

Both sides have been publicly upbeat about the scope for an outline deal following a 15-month diplomatic freeze and exploratory talks in Istanbul last month.

(Reporting by Andrew Quinn; Editing by Michael Roddy)


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Analysis & Opinion

Don’t forget Iran’s record of deception
Now is the time to not only maintain pressure on Iran, but increase it

Related Topics

Energy »

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Israel watching, but making no comments, on Baghdad talks
By HERB KEINON, HILARY LEILA KRIEGER IN WASHINGTON
05/24/2012 02:29
Iran, P5+1 exchange detailed proposals on uranium enrichment; Ya’alon accuses Tehran of still toying with world; State Department describes proposal as a package of first, reciprocal steps.

Israel watched the meeting in Baghdad that began on Wednesday between Iran and six world powers carefully, but refrained from commenting on the content because it was not immediately clear where the talks were headed.

Iran and the P5+1 – the US, Russia, China, France, Britain and Germany – exchanged unusually detailed proposals, though no breakthrough appeared to be in the offing. Notable differences remained over when Iran would be rewarded with relief from economic sanctions.
Related:

Tehran presents proposal on its nuke program
Diplomats: Iran installed more enrichment centrifuges

As the talks got under way, Strategic Affairs Minister Moshe Ya’alon said that Tehran was “toying with the world” to gain time. Among the ministers inside Prime Minister Binyamin Netanyahu’s inner cabinet, he is considered to be taking a more cautious approach to military action against Iran.

“Tight sanctions must continue, alongside international isolation, support for the opposition and a credible military option,” he said. “[The] military option can be prevented if all the other measures are taken. But if none of that helps, someone might then have to take military action against Iran.”

The two sides, according to a Western diplomat, “had a detailed exchange this morning,” and “the atmosphere was businesslike.”

In the afternoon, another diplomat said, Iran reacted to the offers and “also broadened out the discussions to touch on other areas we see as non-core issues.”

Iranian media close to the Tehran government said its chief negotiator Saeed Jalili presented a five-point package covering a “comprehensive” range of nuclear and nonnuclear issues.

The official news agency IRNA sounded a note of discord by quoting Iranian officials referring to the big-power proposal as “nitpicking” while student news agency ISNA said: “Apparently from the Iranian point of view this package is not balanced.”

However, those leaks did not appear to be Tehran’s final response as the talks ran on into the evening.

In Washington, US officials said they expected Iran to take steps to rein in its nuclear program before the West makes reciprocal gestures.

State Department spokeswoman Victoria Nuland said the world powers “put forward a detailed proposal, which includes confidence-building measures that can pave the way for Iran to demonstrate that its nuclear program is for peaceful purposes.” She said that part of this proposal included “step-by-step reciprocal steps aimed at near-term action on our part if Iran takes it own steps.”

“This is a package of first steps,” she continued. “So Iran would take some steps and then we would take some steps.” But she would not detail what these steps entailed and whether there was a timeline in place for implementing them.

White House spokesman Jay Carney said the fact that the talks were taking place in Baghdad as scheduled, building on the first round of talks held last month, was “a sign of progress.”

He stressed that “Iran must demonstrate it is serious about moving forward,” and reiterated that the “fact that there are positive steps forward is absolutely worth noting, but we judge Iran by its actions, not by its promises.”

Carney also indicated the US plans to continue applying pressure on Tehran even as talks are under way.

“We will continue to press forward with our allies and partners with the unprecedented sanctions regime,” he said.

On Monday, the US Senate passed fresh sanctions language that now must be reconciled with a House bill before being sent to the White House for the president’s signature.

Asked whether the Obama administration endorsed the bill, Nuland declined to specify the administration’s position on the grounds that it was draft legislation.

But she said, “We are talking to Congress in general about what more can be done to tighten the sanctions on Iran.”

The world powers’ overall goal in the talks is an Iranian agreement to curb uranium enrichment in a transparent, verifiable way to ensure it is for peaceful purposes only. Iran’s priority is to secure an end to sanctions isolating the country and damaging its economy.

The pivotal proposal by the six, led by EU foreign policy chief Catherine Ashton, was for Iran to halt its enrichment of uranium to the higher fissile concentration of 20 percent, her spokesman Michael Mann said as talks got under way.

Click here for full Jpost coverage of the Iranian threat

That is the Iranian nuclear advance most worrying to the West since it largely overcomes technical obstacles to reaching 90%, or bomb-grade, enrichment.

Iran says it is enhancing the fissile purity to such a degree only for medical research.

“We have a new offer on the table which addresses our main concerns about the Iranian nuclear program: The 20% enrichment question,” Mann told reporters. “We hope the Iranians respond positively and we can make progress today.”

Israel has said consistently that it will only be satisfied if Iran ends all uranium enrichment, transfers all enriched uranium out of the country and closes the underground facility at Qom.

In a separate interview with Iran’s state-run English-language Press TV, Mann said no final deal was expected in Baghdad because progress was likely to be only gradual.

He said toughened sanctions, especially an EU ban on Iranian oil exports due to take full effect on July 1, had helped to finally draw Iran into serious negotiations.

Iran has hinted at flexibility on higher-grade enrichment although analysts caution that it would be unlikely to compromise much while sanctions remain in place.

The talks were expected to extend into Thursday.

Iranian Foreign Minister Ali Akbar Salehi, speaking to reporters in Tehran, said: “The ideas fielded to us speak of the fact that the other side would like to make Baghdad a success. We hope that in a day or two we can bring good news.”

Salehi also warned that Iran would not bow to pressure.

“Their policies of pressure and intimidation are futile. They have to adopt policies to show goodwill to solve this issue.”

Russia said the Islamic Republic appeared ready for serious discussion of substantive steps to resolve the impasse in return for the phased removal of sanctions.

Speaking of preparatory discussions before Baghdad, Foreign Minister Sergei Lavrov said in Moscow: “We got the clear impression... that the Iranian side is ready to seek agreement on concrete actions.”

These would be taken step by step.

Another proposed step will be an updated version of an idea first floated in 2009 that envisaged Iran shipping out the bulk of its stockpile of lowgrade uranium – which is potential nuclear weapons fuel – in return for higher-enriched fuel for the medical research reactor in Tehran, a diplomat said.

It was unclear whether that idea would gain traction after Iran’s announcement on Tuesday that it had supplied its first batch of domestically made fuel to that reactor – a message probably meant to boost its leverage in negotiations.

“The key issue is the 20% enrichment potential. This has to be addressed in order to have a productive outcome,” said one Western diplomat.

“The marching orders for Baghdad are to have concrete ideas on the table, maybe not necessarily agree on all details of these ideas, but to have a clear commitment.”

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http://blog.foreignpolicy.com/posts/2012/05/23/people_who_are_not_in_jail_in_pakistan

Five people who are not in jail in Pakistan
Posted By Joshua Keating Wednesday, May 23, 2012 - 1:58 PM

Shakil Afridi, the Pakistani doctor who helped the CIA collect data that led to the killing of Osama bin Laden, was convicted of high treason today and sentenced to 33 years in prison. Given the severity of the sentence, it's worth considering a few of the people who the Pakistani justice system has not seen fit to put behind bars:

Hafiz Saeed

The head of a banned charity widely believed to be a front for the international terrorist group Lashkar-e-Taiba is wanted by both India and the United States for his alleged role in orchestrated the 2008 Mumbai attacks. The Lahore High Court dropped all charges against Saeed in 2009. Last month, the U.S. offered a $10 million reward for information leading to Saeed's arrest, which raised some eyebrows since he's not in hiding. Saeed held a press conference inviting U.S. authorities to come and get him.

Abdul Qadeer Khan

Despite having admitted to selling nuclear secrets to North Korea, Iran, and Libya, A.Q. Khan was freed from house arrest in 2009. The father of Pakistan's nuclear program has been officially pardoned and is now immune from further prosecution.

Dawood Ibrahim

The boss of the organized crime syndicate D-Company is believed to be one of the world's richest criminals. He is suspected of ties to both al Qaeda and Lashkar-e-Taiba and to have masterminded a series of bombings in Mumbai in 1993. Accodring to some accounts, he lives in a palatial mansion in Karachi, though the Pakistani government has always denied that he is in the country.

Qari Saifullah Akhtar

Akhtar, who is believed to have run an al Qaeda training camp in Afghanistan before 9/11, was arrested in 2004 in the United Arab Emirates and turned over to Pakistan custody, then released a few months later. He was later detained in connection with an attempted assasination attempt on former Prime Minister Benazir Bhutto in October 2007 in Kharachi and then a successful one in December but released both times. Bhutto herself accused Akhtar of involvement in the Karachi attack. He was last released after four months under house arrest in late 2010.

Malik Ishaq

The founder of the al Qaeda-affiliated militant group Lashkar-e-Jhangvi was released after 14 years in jail earlier this year. Ishaq has been accused in at least 70 murders and faced 44 criminal cases -- including allegeldy masterminding the 2009 massacre of the Sri Lankan cricket team, but no conviction has ever stuck.

Hummm....and yes considering the source....

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http://www.foreignpolicy.com/articl...n_isn_t_telling_us_about_the_chinese_military

5 Things the Pentagon Isn't Telling Us About the Chinese Military
Here's what you won't find in the Defense Department’s latest report on China's military rise.
BY TREFOR MOSS | MAY 23, 2012

Think of it like an iceberg: The top lies in plain sight, but a lot more hides beneath the surface.

In its annual appraisal of the Chinese military published last week, the U.S. Department of Defense seems to be describing an object it finds both familiar and mysterious. The report certainly answers many of the important issues concerning China's military, including its attempts to develop an anti-ship ballistic missile and its continuing fixation on Taiwan.

Yet for many crucial aspects of China's strategy, the Pentagon seems like it's just guessing. Here are the five most important questions about Beijing's defense strategy that remain stubbornly unanswered.

1. What are China's long-term defense spending plans?

Although China's official 2012 defense budget is $106 billion, an 11 percent increase over last year and a fourfold increase from a decade ago, the Pentagon places China's total military spending at somewhere between $120 and $180 billion. "Estimating actual PLA military expenditures is difficult because of poor accounting transparency and China's still incomplete transition from a command economy," the report notes, referring to the People's Liberation Army.

There have been no credible estimates of Beijing's long-term defense spending plans. On its current trajectory, China could overtake the United States as the world's biggest military spender in the 2020s or 2030s -- but there are too many unknown variables to accurately predict if this will happen. Is the PLA budget pegged to the growth of the wider economy, or have China's generals been promised double-digit growth even if the country suffers an economic downturn? Will growth slow once certain modernization milestones have been achieved, or are there no plans to close the PLA checkbook? What's clear is that the more funding the PLA receives, the closer it will come to achieving parity with the U.S. military.

2. What is China's nuclear strategy?

The Pentagon concludes that "China's nuclear arsenal currently consists of about 50-75 silo-based, liquid-fueled and road-mobile, solid-fueled ICBMs." The Pentagon doesn't attempt to estimate the total number of nuclear weapons that China possesses, although it's generally assumed to have a much smaller nuclear arsenal than the U.S. cache of over 5,000 nukes. Nonetheless, theories that Beijing possesses or plans to develop a much bigger nuclear weapons stockpile just won't die down. Speculation last year that China may have as many as 3,500 nuclear warheads -- predicated on rumors of a sprawling network of underground tunnels -- has been reliably trashed, but some still argue that Beijing sees a strategic opportunity in building a nuclear arsenal that could match or even exceed that of the United States in the coming decades.

China currently has only two Jin-class Type 094 nuclear-powered ballistic missile submarines (SSBNs) in service, the Pentagon tells us, and the missiles designed to arm the subs are not yet operational (though when they are, they will be nuclear-capable). Two submarines aren't much of a strategic deterrent for an aspiring superpower, but the true scope of the SSBN fleet that China plans to build remains unknown.

3. What is the Chinese navy up to?

American analysts often use the term "string of pearls" to describe Beijing's supposed strategy of establishing a network of foreign naval bases, especially in the Indian Ocean, but the Chinese don't. The latest Pentagon report does not discuss whether China plans to create a U.S.-style network of permanent forward bases for the PLA Navy.

Nonetheless, there is no shortage of speculation that China will eventually deploy military forces to port facilities it has constructed in places like Burma, Pakistan, and Sri Lanka. The Seychelles has invited China to use its ports as resupply points for Chinese ships, but Beijing has insisted that this is not the establishment of a first foreign base, unconvincingly calling it a "re-supply port." The "places or bases" debate has already been running for some years, and it will continue to rumble on while Beijing remains tight-lipped about its long-range ambitions.

The Pentagon report also struggles to shed light on China's future aircraft carrier program, beyond the existence of the single ex-Soviet carrier that is currently undergoing sea trials. "Some components of China's first indigenously produced carrier may already be under construction," it suggests, adding that "China likely will build multiple aircraft carriers and associated support ships over the next decade." That's guesswork. It's unknown whether China envisages merely a couple of working aircraft carriers as floating trophies designed to symbolize the country's arrival as a world power, a handful of combat-capable carriers to drive home its territorial claims in the South China Sea, or a larger number of U.S.-style carrier battle groups with a mission to project force globally.

4. What kind of space capabilities is China developing?

China is becoming increasingly proficient in space. The report mentions that China is assembling its own GPS-style satellite network, blasted the Tiangong-1 spacelab into orbit in 2011, and has developed a ground-launched anti-satellite missile to improve its counter-space capabilities. But the Pentagon neglects to mention one of China's most ambitious space programs: the development of the Shenlong spaceplane and the possible associated development of advanced propulsion systems, whose existence increases the risk of a military space race with the United States.

It is not yet known whether Shenlong is anything more than a hi-tech experiment. But because of Shenlong's military potential, any information about it could allay or exacerbate growing fears within the U.S. military that the PLA Air Force has more than a passing interest in space operations.

5. Paper tiger or fire-breathing dragon?

There are many other imponderables in China's military. Chinese cyber-espionage has been effective in obtaining foreign military secrets, but it's unclear how much of this know-how has been successfully and usefully absorbed into China's own military programs and doctrines. The overhaul of the Chinese defense industry has revolutionized the country's indigenous capabilities, but how close has China really got to ironing out the kinks in its military-industrial structures and processes?

All of the unknowns feed into one larger question: Is the PLA worth the hype? China's military is untested; it hasn't fought a major campaign since a disastrous war with Vietnam in 1979. In the event of conflict, would its performance live up to the nation's expectations, or would disadvantages like corruption and inexperience critically undermine its war-fighting capability? Is the 21st-century PLA even designed to be used, or does it exist to prop up and counterbalance the Communist Party domestically in a world where Beijing calculates that large-scale warfare is increasingly unlikely? Maybe the answers to these questions are buried in some secure vault at the Pentagon, but they're not in its latest report.

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http://www.wnyc.org/npr_articles/2012/may/23/in-egypt-first-day-of-voting-seemed-remarkably-routine/

WNYC News
In Egypt, First Day Of Voting 'Seemed Remarkably Routine'
Wednesday, May 23, 2012
NPR
By Eyder Peralta

Polls have closed on a historic day in Egypt: For many it was the first time they had a say in who their leader will be. Hosni Mubarak, who ruled the country for 29 years, was ousted last year. And before him, for another 30 or so years, Egyptian presidents have run unopposed.

Kimberly Adams was at the polls in Cairo today for NPR. She filed this report for our Newscast unit:

"Many waited in line for hours to choose the replacement for President Hosni Mubarak, who was booted from office during the Arab Spring.

"Fifty-eight-year-old Wahid Zahran stood in line with hundreds of others as polls opened in the suburb of New Cairo.

"He and his two friends admitted it was the first time voting for all of them — and they were planning to vote for different candidates.

"'And it's very nice for the first time in my age to live for the real democracy,' Zahran said.

"Exit polling wasn't allowed, so there's no clear sense yet as to which of the 13 candidates may be in the lead, but it's likely that the second day of voting on Thursday will culminate in a June run-off election."


Perhaps McClatchy Newspapers put it best when they said that despite the history and despite parliamentary elections riddled with irregularities, Wednesday's voting "seemed remarkably routine."
Copyright 2012 National Public Radio.

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http://english.ahram.org.eg/NewsCon...residential-elections,-Day--Turnout-and-.aspx

Egyptian presidential elections, Day 1: Turnout and trends
Although still too early to predict a clear winner, general voting trends became vaguely discernible on day one of Egypt's first-ever free presidential election
Sarah El-Rashidi, Thursday 24 May 2012

The first day of Egypt’s historic presidential elections appears to have passed without incident. Rising voter turnout throughout the day led Hatem Begato, secretary-general of the Supreme Presidential Electoral Commission (SPEC), to extend voting hours by one hour to 9pm to accommodate the increasing numbers.

Out of 13 official candidates, leading contenders belong to three principal ideological fronts. The principal secular candidates include Ahmed Shafiq, ousted president Hosni Mubarak's last prime minister, and Amr Moussa, a Mubarak-era foreign minister and former Arab League chief.

The two key Islamist candidates, meanwhile, are Abdel-Moneim Abul-Fotouh, a former Muslim Brotherhood leader and moderate Islamist, and Muslim Brotherhood candidate Mohamed Mursi.

The increasingly popular Hamdeen Sabbahi, a Nasserist, represents the leftist front.

Egyptians have not participated in presidential elections since 2005, when Mubarak attained a whopping 87 per cent of the vote in polls widely perceived to have been rigged in his favour.

Turnout

Egypt’s first post-Mubarak parliamentary elections late last year saw high voter turnout, with more than 30 million Egyptians – 60 per cent of eligible voters – taking part. Those polls were swept by Islamist parties led by the Brotherhood's Freedom and Justice Party (FJP).

Voter participation on Wednesday was expected to be high, with observers predicting that between 30 and 40 million citizens – out of a total 53 million eligible voters – would take part.

"I predict that around 60 per cent of eligible voters will take part," Saad Eddin Ibrahim, prominent Egyptian human rights advocate, told Ahram Online. "That's a good amount even by democratic standards."

It appears that such predictions may not have been vindicated in all of Egypt's governorates, however, with voter numbers appearing considerably lower in some rural areas.

Some commentators have blamed hot weather – temperatures in Cairo reached 35 Celsius on Wednesday – while others blamed the long distances between polling stations, and the associated travel expenses, for the low numbers.

"I'm not voting. I'm from Assiut in Upper Egypt and can't afford to travel back to my hometown to vote," said one Cairo taxi driver. "The trip alone would cost LE400."

Some voters from the Siwa Oasis in Egypt's Western Desert, meanwhile, reportedly had to travel up to 12 kilometres to reach their designated polling stations.

Other would-be voters voluntarily chose not to cast ballots. Numerous residents of two villages in the Assiut governorate – Beni Idriss and Al-Manshaa Al-Soghra – boycotted the vote to protest months-long shortages of bread and butane gas.

Reported breaches & poll monitoring

Reports of electoral violations during Wednesday's polling, meanwhile, were minimal compared to elections held under the Mubarak regime. According to the media, breaches reported on Wednesday included vote buying in Tanta; limited scuffles outside various polling stations; names missing from Nasr City voter lists; and reported bullying in the northern city of Suez.

The SPEC, for its part, confirmed that it had "strictly" dealt with violations committed by certain presidential candidates and their supporters who defied a ban on last-minute campaigning outside polling stations.

"There were three incidents in which candidates and their supporters violated electoral rules," SPEC head Farouk Sultan stated at a press conference. "The commission has lodged complaints against them with the public prosecution."

Notably, Mursi, Shafiq and Abul-Fotouh have all given interviews recently in contravention of the ban on eleventh-hour campaigning.

Sultan also stated that several judges had pulled out of the monitoring process "for health reasons," denying earlier reports suggesting that they had been forcibly removed.

Rumours of other violations, especially the reported death of a police officer in Cairo's working-class Rod Al-Farag district, were put sleep after the SPEC's Bagato officially refuted them. Bagato clarified that a police officer had been killed on Tuesday in an incident unrelated to Wednesday's polling.

Egypt's ruling Supreme Coucnil of the Armed Forces (SCAF) carefully monitored the electoral process on Wednesday. According to state media, the SCAF's two top officials – Field Marshal Hussein Tantawi and Chief-of-Staff Sami Anan – followed the polling from defence ministry headquarters in Abbasiya.

"The SCAF is following procedures everywhere, making sure that all constituencies are secured and no violations occur of any kind," said SCAF member Mohamed El-Assar.

Voting trends

In terms of voting trends in Cairo and other governorates, observers say it is too early to predict final results, since many voters appear to be making their decisions at the very last minute.

"Opinion polls indicate that many voters have yet to make up their minds," Ibrahim said on the eve of the polls. "We are most likely in for a surprise."

"My relative changed his mind about who he would vote for while waiting on line to cast his ballot," said one local journalist.

Some media sources suggested that voters in certain middle- and upper-income Cairo districts – such as Zamalek and 6 October City - demonstrated a preference for the three secular candidates: Moussa, Shafiq and Sabbahi.

"I'm voting for Moussa, as he's the only candidate with the experience needed to restore Egypt’s economy," said Samir, a Zamalek resident.

"I was torn between Moussa and Sabahi, but finally decided on the latter, as he is our best option as a fresh face," said 6 October resident Said Mamdouh.

Working-class districts and Egypt's Coptic minority, meanwhile, appeared strongly inclined towards Sabbahi and Shafiq.

"Shafiq's a strongman; he can stand up to the politically-dominant Islamists," Magdi, a Copt from Cairo's Shubra district, told Ahram Online. "That’s why I'm voting for him."

Shafiq also appeared the candidate of choice in Cairo's Manshiyat Nasser district, another working-class area with a large Coptic-Christian constituency.

Sabbahi, too, however, seems to enjoy considerable support among Egypt's Coptic community.

"He's a man of the people who was part of the revolution," 24-year-old Michael Hanna, a Copt from the capital's low-income Mokattam district, said of the Nasserist candidate.

Outside of Cairo, voting trends were no less difficult to decipher. In Alexandria, Egypt's second city, popular districts saw high voter turnout compared to middle- and upper middle-class areas. Overall voting trends, however, appeared to vary sharply from district to district, making predictions all but impossible.

In the northern Sinai Peninsula, especially the city of Al-Arish, and in the Upper Egyptian governorate of Qena, Shafiq is reportedly leading the race.

"Shafiq seems to be dominating the vote so far in these places, especially among the predominantly Coptic-Christian residents," Al-Ahram correspondent Mahmoud Dessouki reported. He added, however, that elderly voters appeared to harbour a liking for Nasserist candidate Sabbahi, who they tend to associate with Egypt's golden age under late president Gamal Abdel Nasser.

In the Upper Egyptian Assiut governorate, home to some 2.8 million eligible voters, voter turnout was lower than for parliamentary elections. Nevertheless, observers there say the vote appears split between Shafiq and Mursi.

In southern Sinai, meanwhile, Moussa appears to be the candidate of choice. Observers attribute this to the fact that the ex-Arab League chief was the only candidate to hold a campaign rally in the remote governorate, which only contains some 63,000 eligible voters.

According to judges in the Upper Egyptian governorate of Sohag, voter turnout on the first day of elections was low. They added, however, that, based on their own observations, Shafiq and Moussa appeared to be the most popular candidates there.

Ultimately, analysts and observers agree, it is impossible to make any concrete predictions after only one day of voting. The second and final day of polling is likely to bring with it new surprises, they note, pointing out that, since Thursday has been declared a national holiday, voters were likely to turn out in much greater numbers.

Related
Campaigners compare notes after first day of Egypt presidency vote
First day of presidential elections witnessed no violence: Interior ministry
EU welcomes Egypt's first post-Mubarak presidential elections
Veteran sociologist activist chimes in on Egypt presidential elections
Relive day 1 (of 2) in Egypt's first post-Mubarak presidential elections
Egypt's schools closed during presidential elections

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http://www.ledger-enquirer.com/2012/05/23/2059054/with-outcome-unknown-egyptians.html

With outcome unknown, Egyptians vote for president

By NANCY A. YOUSSEF AND HANNAH ALLAM — McClatchy Newspapers

Posted: 4:00am on May 23, 2012; Modified: 7:56pm on May 23, 2012

In an historic first, Egyptians voted Wednesday for their next president, choosing from an array of competing candidates whose wildly divergent campaign platforms pledged everything from revolutionary, religion-based change to a return to the stability of the Hosni Mubarak-era, which came to an end with Mubarak's ouster last year.

As had been the case in the weeks leading up to the election, there was no sense of a front-runner in interviews at the polling places - and hints that the results could be surprising.

In poor Cairo neighborhoods, where residents might be expected to pick Muslim Brotherhood candidate Mohammed Morsi, many voters instead said they had cast ballots for Ahmed Shafik, a former air force commander who was Mubarak's last prime minister.

Afaf Mohammed, 45, who voted for the Muslim Brotherhood during the parliamentary elections, was among those who'd switched allegiances to Shafik. "He'll bring better security," she said.

Hamdeen Sabahi, who espouses the Arab nationalist philosophy of the late President Gamal Abdel Nasser, a distant fourth, appeared to be many voters' preference in some parts of the country.

At a polling place in Luxor, in southern Egypt, 38-year-old Reham Abdel Gawad, wearing the all-encompassing black shroud of the most fundamentalist Islamists, said she'd voted for Sabahi, a secularist, because she felt that he showed the most empathy for Egypt's poor.

"The veil is on my face, not my mind," she said, explaining her decision to break ranks. "Not all Islamists are good for the country. The preacher is a preacher, and the politician is a politician."

Emotions were high among the thousands who formed long lines around schools that served as polling centers. Some said they could not believe they were choosing a president in a free and fair election after 30 years of living in fear and forced silence. Some tapped the plastic ballot box as they dropped their ballot in and said the beginning line of an Islamic prayer, before walking out of the room, with an inked forefinger indicating a vote.

Others expressed long-held rage. As Shafik left the polling center where he cast his ballot, voters pelted him with shoes.

Some saw the vote as the start of real reforms while others voted simply to be a part of the experience. "I voted for Morsi. I don't know anything about him but everyone told me to vote for him, and at the mosque his fliers were everywhere," said Fouzah Ahmed, who could say only that he was over 70 years old because "I lost count."

If there was a pattern in the balloting it was that younger voters appeared later at the polling stations. Officials extended voting hours from 8 to 9 p.m. to accommodate the late voters. In the Cairo district of Maadi, some people arriving after work stood in line for four hours to vote.

The only two candidates who engaged in a presidential debate during the two-month election cycle, Islamist moderate Abdel Moneim Aboul Fotouh and Amr Moussa, the former secretary general of the Arab League, had cast their ballots by 11 a.m. Aboul Fotouh then went to a mosque and prayed.

Perhaps the most common question among voters was: Who do I vote for? Some asked it of election workers and observers as they tried to vote.

Others came prepared, pulling a piece of paper from their pocket with their selection written on it after they had a ballot in hand.

In one polling station, a woman was so exasperated when no one would tell her what to do, she simply folded up the blank ballot and dropped it in the box.

Where the parliamentary elections last fall were riddled with violations that included parties electioneering outside polling stations, Wednesday's voting seemed remarkably routine, though allegations of misconduct, impossible to verify, swirled. There were accusations that various parties' supporters had entered shops to persuade people to vote. There were also reports that five election judges were forced out of their jobs in Sinai because they told voters how to vote, though the country's elections commission later denied that.

More common violations appeared to be election workers misinterpreting how to apply the rules. Some didn't ask women in niqab to lift their veils and identify themselves to female workers until after they voted, for example. Disabled voters got various kinds of help, depending on the polling station. At times, observers and election workers would end up talking to voters, a violation, though the exchange often was only a greeting between people who knew one another.

In Sinai, where security is always a concern, armored personnel carriers sat in front of every polling station. A feeling of optimism reigned, nonetheless.

"This is the first time we feel encouraged to work after what happened to the police department on Jan. 25," said Police Staff Sgt. Ayman Mahmoud, 30, referring to attacks on police facilities in Sinai last year at the beginning of the uprising that ousted Mubarak. "We are securing the nation, not the army or the police department and our only loyalty is to the people. The elections are as much a success for us as it is for the civilians."

The Egyptian-government funded National Council of Human Rights, which had monitors in Sinai, reported no violations. "The only trouble was that judges are late as much as an hour," delaying the start of the election, said Baker Swaliem, an election monitor stationed in Sinai for the Amr Moussa campaign.

Each polling station was a fiefdom for the judge in charge who determined how the rules should be applied. Some judges signed the back of every ballot while others simply handed the ballots out.

In the Cairo district of Maasara, a woman tried to tell her elderly illiterate mother how to vote, prompting election judge Ahmed AbdelHaffiz to angrily kick her out of the classroom that served as a polling station. "She is your mother at home, not here," he shouted at the distraught woman. "You have to yell at women so they understand" he explained later.

It was unclear whether voter turnout was high. Election officials estimated it at 60 percent turnout, but in the middle class neighborhood of Aguza, election judge Rasha Moneer said that while officials there had expected 90 percent of eligible voters to cast ballots, only 25 percent had done so by 7 p.m. Several judges told McClatchy Newspapers that a lack of judges forced the election to merge polling districts, creating large, frustrated crowds in some places. There was no sign, however, of polling centers being overwhelmed.

According to election officials, more than 50 million Egyptians are eligible to vote, including ousted former President Mubarak; it was unclear if he had cast a ballot, however.

What the responsibilities and power of the new president will be is still undecided. Egypt's old constitution was suspended after Muabrak fell, and a new one has yet to be written. The ruling military council has said it would delineate what powers the president will have by July 1, when the new president is scheduled to take office.

A mosaic of concerns shaped voters' decisions, from crime to rising unemployment to the role of Islam in the governance of the state to whether the uprising 15 months ago that led to the end of Mubarak's regime had benefited Egypt.

In Luxor, a southern city that boasts ancient temples and stunning Nile vistas, voters said their No. 1 concern was the lack of tourism since the revolution began. Voters there elected Muslim Brotherhood candidates for Parliament last year, but many residents said they'd grown disenchanted with the group's performance and nervous about any single bloc holding a monopoly on Egyptian political life, as Mubarak's regime enjoyed.

"For Parliament, OK, but that's enough. The Brotherhood shouldn't control everything," said Mustafa Mohamed, 25, who runs hot-air balloon tours and voted for Abdel Moneim Aboul Fotouh, a former Brotherhood member who was expelled from the group last year.

Mohamed said his business had declined 60 percent since Mubarak's resignation in February 2011.

Visiting reporters had to drive deep into the countryside to find a large, overt presence of Brotherhood support. In the hometown of a Brotherhood lawmaker, a village with 8,500 eligible voters, the group's Freedom and Justice Party was using five minibuses to ferry supporters to the polls.

"We're trying to mobilize the maximum number of our supporters so that our candidate, Mohammed Morsi, will make it to the runoff," said Abdel Hamid el Senussi, a Muslim Brotherhood politician who won a seat in Parliament representing Luxor.

Senussi said he understands the criticism of the Brotherhood's foray into politics, but insists that the lack of progress so far is because the group's platform was stymied by rival political forces who wanted to stunt the Islamists' popularity. If Morsi wins, he said, the president and Islamist-majority Parliament would be in sync and thus able to enact real reforms.

"We have a triangle of horrors in Upper Egypt: illness, ignorance and poverty," Senussi said of his region. "We need hospitals, universities and factories."

In Cairo, telecommunications engineer Ahmed Ibrahim, 52, voted for Aboul Fotouh, calling him the least bad choice.

"My life is stable but during this period of change, there are a lot of bad things happening," Ibrahim said. Aboul Fotouh, he said, "is in the middle of what everyone wants. He is not a great candidate but the best available."

Fatma Mohammed Moneer, a 49-year-old physical education teacher, agreed with Ibrahim that revolutionary change had not all been good. Now she wants someone who can stabilize the nation, which is why she voted for Shafik.

"He is the only one who can manage the country through these times," she said. "We need a leader.

Even as the ballots were being cast, government officials already had begin to urge voters to accept the outcome, which is not expected to be known for a week. Ahmed el Tayeb, the grand sheikh of al-Azhar University, Sunni Islam's premier religious institution, warned in a recorded message that was played on state radio stations that not voting was a sin. And the election committee officials and the ruling military council put out a message urging voters to accept the outcome.

Some Egyptians suspect the ruling military council will rig the election in favor of Shafik, a retired general, and some of those found near polling stations said they wouldn't vote because they had no faith in the process.

Egypt allowed only half the voting monitors it had permitted to observe parliamentary elections and only a handful of international observers. Despite that, former President Jimmy Carter, whose Carter Center was given permission to monitor the election after first being told it could not, appeared at a Cairo polling station and said he was pleased with the process, calling it a "complete transformation."

(Allam reported from Luxor, Egypt. McClatchy special correspondents Amina Ismail in Cairo and Mohanned Sabry in Sinai contributed to this article.)

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http://english.chosun.com/site/data/html_dir/2012/05/24/2012052400631.html

U.S. Officials in Secret Visit to N.Korea Before Rocket Launch

Two senior U.S. figures apparently flew to Pyongyang aboard a U.S. Air Force plane in a secret mission six days before North Korea's failed rocket launch on April 13.

"At around 7:40 a.m. on April 7, a U.S. Air Force Boeing 737 entered North Korea," a diplomatic source in Seoul said. "The aircraft flew from Guam and into North Korea along the same route on the West Sea used by former President Kim Dae-jung during his visit to the North back in 2000."

Experts speculate that the plane carried Joseph Di Trani, a nuclear negotiator in the George W. Bush administration, and Sydney Seiler, a National Security Council advisor to U.S. President Barack Obama.

The secret visit appears to have been a last-ditch effort by Washington to stop North Korea from pressing ahead with the rocket launch.

englishnews@chosun.com / May 24, 2012 09:09 KST

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http://www.japantimes.co.jp/text/eo20120524a1.html

Thursday, May 24, 2012

Beijing's North Korea policy only emboldens Pyongyang

By RALPH A. COSSA and BRAD GLOSSERMAN

HONOLULU — Discussions in Beijing about North Korea are always frustrating. It's not so much due to the sharp divergence in U.S. and Chinese thinking about how to deal with Pyongyang; the two sides differ on many issues. No, the real problem, from our perspective, is the illogic of the Chinese position. Indeed, it would be hard to create a policy toward North Korea that does more damage to Chinese national interests than Beijing's current approach toward Pyongyang.

The standard explanation for Chinese policy goes like this: While denuclearization is desired, stability comes first. There is little chance that North Korea can be persuaded to give up its weapons, as its arsenal is seen as a form of legitimacy and a deterrent to regime change. Moreover, Beijing has limited influence in Pyongyang and North Korea's real aim is a relationship with the United States, hopefully one that sidelines Seoul as well. This logic produces a policy of minimal pressure on Pyongyang, calls for good behavior by "all parties," demands that the U.S. soften its position and be more accommodative, and the fending off of demands for Beijing to do more.

Recent discussions in Beijing made plain the ways that this policy undermines Chinese interests. China enables Pyongyang's misbehavior. When dealing with North Korea, China walks softly and has discarded the stick. Whether motivated by ties once as close as "lips and teeth," the desire to maintain whatever leverage China has in Pyongyang, or the fear that pressure might destabilize the North or prompt it to act out, Beijing refuses to crack down on North Korean misdeeds. Instead, it offers diplomatic cover and minimizes any punishment that might be agreed upon by the international community.

For example, while Beijing agreed to a UNSC Presidential Statement condemning the North's recent missile launch, it quickly whittled down the list of North Korean companies to be sanctioned from the 40 proposed by the U.S., European Union and others to three. The result is a feeling of impunity in Pyongyang that leads to precisely the destabilizing behavior that Beijing says it fears. It has also bought China little goodwill in the North; Beijing is insistent on the need to give "face" to Pyongyang; with its antics, Pyongyang shows little regard for China's "face."

China antagonizes its neighbors. The readiness to back Pyongyang infuriates South Koreans. Beijing's fear of offending North Korea by even expressing condolences for the deaths of South Koreans after the sinking of the Cheonan and the shelling of Yeonpyeong Island has hardened South Korean feelings toward China. Nearly 92 percent of South Koreans were dissatisfied with Beijing's response to the shelling incident and more than 58 percent wanted Seoul to strongly protest, even if it meant damaging the economic relationship with China. More than 60 percent now consider China the biggest threat after reunification, almost three times as many as identified Japan. South Koreans are visibly offended by Beijing's call for "all parties" to act responsibly when it is North Korea that is the offender.

China contributes to the strengthening of the U.S. alliance system that it considers a tool of encirclement. Pyongyang's provocations, combined with China's refusal to do more to stop them, has driven Seoul and Tokyo to consolidate military relations with the U.S. Eager to strengthen the deterrent, U.S. alliances in Northeast Asia are being modernized and reinforced, amid calls for enhancing U.S. extended deterrence. Some in Seoul are even calling for a redeployment of U.S. tactical nuclear weapons to the Korean Peninsula. Their common concern regarding the North is such that South Korea and Japan are even stepping up bilateral coordination among themselves, a long-sought U.S. goal, but one that has been hindered by historical animosity between Seoul and Tokyo.

China tarnishes its image as a supporter of international law and norms and undermines those norms. International law is hollow if it has "no teeth." The protection afforded Pyongyang and the refusal to see that U.N. sanctions have consequences undermines attempts to stop North Korean misbehavior, encourages other governments to act in similar ways, and makes a mockery of international laws and institutions. Countries that would prefer to rely on international law instead develop ad hoc mechanisms to prevent illegal behavior. Put more bluntly, the more Beijing renders the U.N. Security Council useless in dealing with the challenges to world security, the more it encourages, if not necessitates, the creation of "coalitions of the willing."

China reinforces the U.S. role in Northeast Asia and supports its international legitimacy. The reinforcement of U.S. alliances more deeply embeds the U.S. in the region. The growing role of those alliances signals their worth and value to other governments. The claims that China has marginal influence in North Korea and that the U.S. is the real target of Pyongyang's activities highlights the significance, importance, and centrality of the U.S. to regional diplomacy.

China blocks contingency planning that can keep a crisis from occurring or worsening. We are repeatedly warned that attempts to discuss North Korea in trilateral or multilateral settings would send the wrong signal to Pyongyang and spur it to act out. So, while experts concede that we need to prepare for a range of crises and contingencies, actually doing so isn't done for fear of antagonizing North Korea. In fact, such planning takes place without Beijing. But China has interests in North Korea and is likely to intervene in the event of a crisis. Advanced discussions of how that might occur could minimize the risk that Chinese forces might reach a standoff, or worse, with allied forces in a crisis.

There is some potential good news on the horizon, however. More and more frequently, we witness our Chinese colleagues seriously debating one another over the logic behind Beijing's current policy. Many are truly embarrassed to be seen as Pyongyang's best (only?) friend and protector. They question whether you can actually have stability — China's primary objective — as long as the North has nuclear weapons. And, they acknowledge an even more important downside for the long term.

No one can predict when it will occur, but it is becoming increasingly clear that the peninsula will one day be reunited, under the political, economic, and social system that exists today in Seoul. The longer Beijing keeps the North on life support without insisting on the openness and reform that will set the stage for eventual peaceful reunification, the deeper will be the resentment of the Korean people and the greater will be their suspicion regarding China's long-term motives.

How this serves Beijing's interests remains beyond our ability to comprehend. At some point, one hopes that logic will finally prevail!

Ralph Cossa is president and Brad Glosserman is executive director of the Honolulu-based Pacific Forum CSIS. A longer version of this article appeared in PacNet Newsletter.

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http://the-diplomat.com/the-editor/2012/05/23/north-korea-upgrading-missile-site/

North Korea Upgrading Missile Site?
By Jason Miks
May 23, 2012

Some interesting reports the past couple of days underscore why though North Korea has largely been on the backburner of the international news agenda the past few weeks, the issues surrounding its nuclear program are far from settled.

The 38 North site reported yesterday on new satellite imagery suggesting a major upgrade of North Korea’s Tonghae Satellite Launching Ground that’s “intended to support future launches of rockets larger than the recently tested Unha – more capable liquid fueled space launch vehicles or missiles with intercontinental ranges – that will also overfly Japan.”

“In addition to a new launch pad under construction, much of the nearby village of Taepodong has been razed to clear the way for what appears to be a new building designed to assemble larger rockets.”

Perhaps most intriguingly, 38 North notes that the new assembly building is similar to one located at Iran’s Semnan Missile and Space Center.

“While the extent of North Korean-Iranian collaboration on a new long-range liquid fueled rocket that both appear to be developing remains unclear, such cooperation would not be out of the question since the two countries have worked together on most of their ballistic missile and space launch vehicle development in the past. As construction progresses on the new North Korean facility, careful examination of further satellite photography will be warranted to discern possible new signs of cooperation.”

I wrote a couple of months back about the continued speculation over the extent of collaboration between North Korea and Iran, including the suggestion in German paper Die Welt, supposedly based on Western intelligence sources, that North Korea may have undertaken a nuclear test on behalf of Iran. That story was dismissed by some nuclear weapons experts, but either way, the two countries have a history of collaboration.

Last year, for example, a U.N. report suggested North Korea and Iran appeared to have been regularly exchanging ballistic missile technology, in violation of U.N. sanctions.

“Prohibited ballistic missile-related items are suspected to have been transferred between the Democratic People’s Republic of Korea and the Islamic Republic of Iran on regular scheduled flights of Air Koryo and Iran Air,” the report said. “For the shipment of cargo, like arms and related materiel, whose illicit nature would become apparent on any cursory physical inspection, (North) Korea seems to prefer chartered cargo flights.”

Parris Chang, a former deputy secretary general of Taiwan’s National Security Council, has a piece up in The Diplomat today that’s critical of the Obama administration’s approach to tackling North Korea, specifically what he describes as the “outsourcing” of policy to China.

What should the U.S. be doing instead? I asked Robert O’Brien, a senior foreign policy advisor to likely Republican presidential nominee Mitt Romney, for his take.

“North Korea’s nuclear weapons program is a serious menace to world peace. Nuclear weapons in the hands of Pyongyang threaten American forces on the Korean Peninsula and elsewhere in East Asia as well as our close allies South Korea and Japan. Furthermore, the North Korean nuclear program creates a real danger of proliferation of these weapons to rogue regimes, American adversaries and terrorist groups,” he told me.

“Unfortunately, the current administration’s approach to North Korea, based on a food aid deal that was violated by North Korea in a mere 16 days, demonstrates triumph of hope over experience. Simply put, President Obama has made no progress in disarming North Korea.”

And how would a Romney administration do things differently?

“Gov. Romney will crack down on banks doing business with North Korea and sanction companies that conduct commercial shipping in and out of that nation. He will also step up enforcement of the Proliferation Security Initiative to constrain North Korea’s illicit exports by increasing the frequency of inspections of North Korean ships and discouraging foreign ports from permitting entry of such ships into their countries.”

In the meantime, North Korea has further ramped up the rhetoric, while denying it has any plans for a nuclear test.

“We had access to nuclear deterrence for self-defense because of the hostile policy of the U.S. to stifle the DPRK by force and we will expand and bolster it nonstop as long as this hostile policy goes on,” an unidentified spokesman for the North Korean Foreign Ministry said in a report by the state-run Korean Central News Agency, CNN reports.

Bloomberg, meanwhile, reported today that North Korea has denied that it is planning a nuclear test.

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http://www.spacedaily.com/reports/Russia_tests_new_missile_after_NATO_summit_999.html

Russia tests new missile after NATO summit
by Staff Writers
Moscow (AFP) May 23, 2012

Russia on Wednesday staged the first successful test-launch of a new intercontinental missile designed to penetrate the defence system now being deployed by NATO despite Moscow's fierce complaints.

The highly-symbolic launch came just days after alliance formally activated the first stage of a missile defence shield whose deployment Russia has bitterly opposed out of fears that it may target its own vast nuclear arsenal.

"The dummy warhead reached its target area at the Kura test range on the Kamchatka Peninsula. The set goals of the launch were reached," Interfax quoted Russian Strategic Nuclear Forces spokesman Vadim Koval as saying.

A military source told the agency that the launch was only the second ever conducted in the top-secret programme.

The source said the first failed on September 27 when the missile suffered an undisclosed malfunction and crashed only 10 kilometres (six miles) from the launch site.

The rocket still has no formal name but is being billed by the military as a "fifth generation" weapon that substantially upgrades the technology used by its already-feared feared Topol-M and Yars systems.

Various sources told Interfax that the new missile was better equipped to penetrate the new US-backed missile defence system in Europe whose first stage NATO official activated at its Chicago summit on Sunday.

"This is one of the... measures being developed by Russia's military and political leadership in response to the US deployment of a global anti-missile system," former strategic forces director Viktor Yesin told Interfax.

Little is known about the new weapon except its purported ability to better avoid being shot down.

The Russian missile "uses a new type of fuel that helps reduce the time required to operate the propellants in the active stage of the rocket's trajectory," one military source said.

Officials believe this makes it more difficult to detect and easier to manoeuvre. Interfax said the weapon is also equipped with individual warheads that can change course to avoid being shot down.

Russia has hundreds of missiles capable of raining down nearly 2,000 nuclear warheads on the United States and its other former Cold War-era foes.

But much of the force is built on technology developed in the Soviet era that Russia fears may become obsolete by the time NATO's shield becomes fully operational by the scheduled date of 2018.

Russian President Vladimir Putin unveiled a massive new armaments programme during his successful election to a third term and made a visit to a military factory one of his first high-profile stops after his May 7 swearing in.

Putin's predecessor and protege Dmitry Medvedev warned the West last year that Russia will have to deploy new rockets on the borders of NATO's European partners such as Poland should its concerns not be addressed.

The army's top general Nikolai Makarov this month also warned the United States that Russia reserved the right to preemptively strike NATO targets once it feels its shield posed a significant threat.

US President Barack Obama has sent multiple negotiating missions to Moscow and was earlier this year caught by an open microphone telling Medvedev that he intended to negotiate more on the issue should he win re-election in November.

The Russian military forces spokesman said the missile was launched from a mobile system at the northern Plesetsk space base at 10:15 am (0615) GMT on its 6,000-kilometres (3,700-mile) journey to the Pacific.

News reports did not specify the missile's actual range nor the number of warheads it can carry.

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http://www.reuters.com/article/2012/05/24/us-eurozone-greece-idUSBRE84M0P420120524

EU urges Greece to stay in euro, plans for possible exit
By Claire Davenport and Luke Baker
Comments 2

BRUSSELS | Wed May 23, 2012 8:54pm EDT

(Reuters) - European Union leaders, advised by senior officials to prepare contingency plans in case Greece decides to quit the single currency, urged the country to stay the course on austerity and complete the reforms demanded under its bailout program.

After nearly six hours of talks held during an informal dinner, leaders said they were committed to Greece remaining in the euro zone, but it had to stick to its side of the bargain too, a commitment that will mean a heavy cost for Greeks.

"We want Greece to stay in the euro, but we insist that Greece sticks to commitments that it has agreed to," German Chancellor Angela Merkel told reporters after a Wednesday evening summit in Brussels dragged long into the night.

Three officials told Reuters the instruction to have plans in place for a Greek exit was agreed on Monday during a teleconference of the Eurogroup Working Group (EWG) - experts who work for euro zone finance ministers.

The Greek finance ministry denied there was any such agreement but Belgian Finance Minister Steven Vanackere, said: "All the contingency plans (for Greece) come back to the same thing: to be responsible as a government is to foresee even what you hope to avoid."

Two other senior EU officials confirmed the call and its contents, saying contingency planning was only sensible.

In its monthly report, Germany's Bundesbank said the situation in Greece was "extremely worrying" and it was jeopardizing any further financial aid by threatening not to implement reforms agreed as part of its two bailouts.

It said a euro exit would pose "considerable but manageable" challenges for its European partners, raising pressure on Athens to stick with its painful economic reforms.

Greek officials have said that without outside funds, the country will run out of money within two months and there remains the threat that if it crashes out of the euro zone, other member states could be brought down too.

A document seen by Reuters detailed the potential costs to individual member states of a Greek exit and said that if it came about, an "amiable divorce" should be sought with the EU and IMF possibly giving up to 50 billion euros to ease its path.

Although EU leaders' minds will have been focused by that prospect, disagreements have flared over a plan for mutual euro zone bond issuance and other measures to alleviate two years of debt turmoil, such as giving countries like Spain an extra year to make the spending cuts demanded of them.

"The idea is to put energy into the growth motor. All the member countries don't necessarily share my ideas. But a certain number expressed themselves in the same direction," new French President Francois Hollande told reporters.

For the first time in more than two years of crisis summits, the leaders of France and Germany did not huddle beforehand to agree positions, marking a significant shift in the axis which has traditionally driven European policymaking.

Instead, Hollande met Spanish Prime Minister Mariano Rajoy in Paris to discuss policy, before the pair travelled to Brussels by train.

Despite fears Greeks could open the departure door if they vote for anti-bailout parties at a June 17 election, Spain, where the economy is in recession and the banking system in need of restructuring, is at the front line of the crisis.

After meeting Hollande, Rajoy said he had no intention of seeking outside aid for Spain's banks, which are laden with bad debts from a property boom that bust and still has some way to go before it touches bottom.

But his government said its rescue of problem lender Bankia would cost at least 9 billion euros and it is also seeking ways to help its highly indebted regions meet huge refinancing bills.

SHIFTING SANDS

Socialist Hollande's election victory has significantly changed the terms of the debate in Europe, with his call for greater emphasis on growth rather than debt-cutting now a rallying cry for other leaders.

That has set up a showdown with conservative Merkel, whose primary objective is budget austerity and structural reform.

At his first EU summit, Hollande chose to make a stand on euro bonds - issuing common euro zone debt - despite consistent German opposition to the idea. "I was not alone in defending euro bonds," he said.

Merkel showed no sign of dropping her objections to the proposal, which she has said can only be discussed once there is much closer fiscal union in Europe. "There were differences in the exchange about euro bonds," she said bluntly.

The Netherlands, Finland and some smaller euro zone member states support her.

No major decisions were made at Wednesday's summit, which was intended to promote ideas on jobs and growth ahead of another meeting at the end of June.

But debate was intense, not just over euro bonds but over how to rescue banks and whether to give more time to struggling euro zone countries to meet their budget deficit goals.

"We haven't come together to confront each other ... but we have to say what we think - what are the right instruments, the right methods, the right steps, the right initiatives to raise growth," Hollande said.

The leaders discussed broad measures to stem the fallout from a winding up or restructuring of bad banks, EU officials said, with the European Central Bank pressing for the bloc to stand behind its struggling lenders but with Merkel's approval seen as far from guaranteed.

At the heart of the discussion are proposals from the European Commission for a legal framework to wind up or reorganize insolvent banks so as to avoid a repeat of the multi-trillion-euro taxpayer bailouts during the financial crisis.

Another suggestion is for the euro zone's rescue funds to be allowed to recapitalize banks directly, rather than having to lend to countries for on-lending to the banks. But that is another idea with which Germany is uncomfortable.

Having rallied on Tuesday, European stocks dropped 2.2 percent as investors priced in a lack of dramatic policy action. The euro tumbled against the dollar to its lowest since August 2010 and Spanish and Italian borrowing costs climbed.

A German two-year debt auction gave a stark illustration of how money is dashing for safe havens. Investors snapped up the 4.5 billion euros of paper on offer even though it came with a zero coupon - offering no return at all.

SEARCH FOR GROWTH

With the euro zone registering no growth in the first quarter and threatening to slip back into recession, policymakers touted three ideas to provide stimulus:

- 'Project bonds' backed by the EU budget to finance infrastructure projects alongside private sector investment.

- Doubling the paid-in capital of the European Investment Bank, the EU's co-financing arm, to a little over 20 billion euros.

- Redirecting structural funds which tend to flow to poorer countries, to other areas where they might reap more immediate growth rewards.

Even if all three proposals were to be activated quickly, economists say they will not provide a sufficient shot in the arm to the euro zone and the wider EU economy.

(Additional reporting by Jan Strupczewski, John O'Donnell, Catherine Bremer and Marine Hass in Brussels and Julien Toyer in Madrid. Writing by Mike Peacock, editing by Anna Willard and Giles Elgood)

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Analysis & Opinion

Shifting euro zone sands
What is the long-term euro vision?

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http://www.reuters.com/article/2012/05/24/iran-nuclear-idUSL5E8GNEDP20120524

Detailed, "engaged" Iran nuclear talks go to 2nd day

Wed May 23, 2012 8:55pm EDT

* US official says talks detailed, both sides engaged

* Powers focus on Iran's enrichment of uranium

* Iran's priority is easing of sanctions

By Andrew Quinn and Justyna Pawlak

BAGHDAD, May 24 (Reuters) - Talks between Iran and world powers to defuse a dispute about Iran's nuclear goals go into a second day on Thursday with Washington cautiously hopeful of progress towards an agreed framework for addressing concerns that Tehran wants to build an atom bomb.

"I believe we have the beginning of a negotiation," a senior U.S. official said of the discussions, which opened on Wednesday in the Iraqi capital, Baghdad, in a renewed effort at diplomacy that will seek to ease decades of ingrained mistrust.

"We have got engaged ... we have had detailed discussions" for a potential further round of talks, the official said, adding the meeting would continue into a second day on Thursday.

The discussions, watched closely by global oil markets as well as by Iran's arch-enemy Israel, are aimed at exploring ways to settle a long-standing dispute about a nuclear energy programme the West suspects is aimed at nuclear bomb research. Tehran has long stated the programme is strictly for peaceful purposes.

Both sides - Iran on the one hand and the United States, Russia, China, France, Britain and Germany on the other - have been publicly upbeat about the scope for an outline deal following a 15-month diplomatic freeze and exploratory talks in Istanbul last month.

In previous meetings, the two sides could not even agree on an agenda, with each largely repeating known positions and Tehran refusing any dialogue on changes to its nuclear path.

But international energy markets remain nervous, unsettled by extended Western sanctions imposed on Iran's crude exports and the spectre of a Middle East conflict arising from possible Israeli strikes against Iran's nuclear installations.

Speaking after the first day of discussions, the senior U.S. official said the meeting revealed a "fair amount of disagreement" but also areas of common ground.

"But still we have to come to closure ... about what are the next appropriate steps."

The overall goal of the six countries jointly negotiating with Tehran is an Iranian agreement to curb uranium enrichment in a transparent, verifiable way to ensure it is for peaceful purposes only. Iran's priority is to secure an end to sanctions isolating the country and damaging its economy.

The senior U.S. official later confirmed that the six powers had also put specific measures to lessen sanctions pressure on the table in the discussions as part of a possible confidence-building package, but declined to elaborate.

IRAN HINTS AT FLEXIBILITY

The pivotal proposal by the six, led by European Union foreign policy chief Catherine Ashton, was for Iran to halt its enrichment of uranium to the higher fissile concentration of 20 percent, her spokesman, Michael Mann, said as talks got under way.

That is the Iranian nuclear advance most worrying to the West since it largely overcomes technical obstacles to reaching 90 percent, or bomb-grade, enrichment. Iran says it is enhancing the fissile purity to such a degree only for medical research.

Tehran has repeatedly ruled out suspending enrichment as called for by several U.N. Security Council resolutions.

But Iran has hinted at flexibility on higher-grade enrichment, although analysts caution that it would be unlikely to compromise much while sanctions remain in place.

Iranian media close to the Tehran government said its chief negotiator, Saeed Jalili, presented its own five-point package of proposals covering a "comprehensive" range of nuclear and non-nuclear issues.

But a European diplomat, referring to the reported Jalili proposals, said: "We are not quite sure what these five points are. We are trying to find out. There are no details." (Additional reporting by Patrick Markey and William Maclean in Baghdad, Marcus George in Dubai, Fredrik Dahl in Vienna and Steve Gutterman in Moscow; Writing by Mark Heinrich; Editing by Peter Cooney)


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Analysis & Opinion

JPMorgan case puts Volcker Rule and SIFIs back in the spotlight
Don’t forget Iran’s record of deception

Related Topics

Basic Materials »
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http://online.wsj.com/article/BT-CO-20120523-720369.html

May 23, 2012, 9:42 p.m. ET

WORLD FOREX: Euro Falls As EU Leaders Fail To Reassure Market

Article
-- Euro slips vs dollar, yen after EU summit

-- Lack of concrete outcome at summit, although expected, suggests no solution to euro-zone crisis in sight

-- Chinese PMI at 0230 GMT is in focus, with further falls in the euro possible

-- Dollar may fall to Y79.0 if risk aversion intensifies, some traders say


By Takashi Mochizuki
Of DOW JONES NEWSWIRES


TOKYO (Dow Jones)--The euro remained under pressure against the dollar and yen in early Asian trading Thursday, as traders saw an apparent lack of consensus in Europe on how to deal with the region's debt crisis as a sign that market turmoil is set to continue.

At the end of an informal summit, European Union leaders reiterated that they supported Greece's continued euro membership as long as the country honors its commitments to fiscal consolidation and structural reforms.

But they sent mixed messages on concrete steps to deal with the widening crisis, such as a proposal to issue euro-zone bonds to reduce borrowing costs for struggling countries, with some leaders contradicting each other on what had been discussed at the meeting.

Although traders were not expecting any significant breakthrough at the summit, signs that countries remain deeply divided on how to tackle the crisis caused them to sell the common currency.

European leaders "are speaking about the same subject, but what they are saying is so different from each other," said Yuji Saito, director of foreign exchange at Credit Agricole Bank in Tokyo.

On the topic of euro-zone bonds, German Chancellor Angela Merkel said after the summit that member countries had different views.

The euro fell to $1.2555 from $1.2600 before the outcome of the E.U. summit, and to Y99.73 from Y100.16.

Overnight, the common currency dropped to its lowest level against the dollar since July 2010, amid growing doubts that Greece would be able to remain in the euro zone.

Looking ahead, investors will pay attention to Chinese PMI data due at 0230 GMT, with further falls in the euro possible if the outcome misses the previous month's reading, analysts said. In April, it was 49.3.

"Even if May's outcome turns out to be stronger than April's, it's hard to imagine that investors will become more willing to make riskier bets on currencies," said Minori Uchida, chief analyst at the Bank of Tokyo-Mitsubishi UFJ.

The greenback, meanwhile, slipped to Y79.41 from Y79.53. Traders expect no big move in the currency pair because both units are being bought against the euro. But they added it's possible that the greenback could fall as low as Y79.00 if risk-aversion sentiment intensifies.

The ICE Dollar Index, which tracks the U.S. dollar against a basket of currencies, was at 82.087.


Interbank Foreign Exchange Rates At 20:50 EST / 0050 GMT

Latest Previous %Chg Daily Daily %Chg
2150 GMT High Low 12/31
Dollar Rates
USD/JPY Japan 79.44-46 79.47-51 -0.05 79.53 79.42 +3.30
EUR/USD Euro 1.2571-74 1.2580-83 -0.07 1.2598 1.2556 -2.99
GBP/USD U.K. 1.5687-92 1.5688-93 -0.01 1.5701 1.5678 +0.95
USD/CHF Switzerland 0.9550-54 0.9544-48 +0.07 0.9564 0.9534 +1.92
USD/CAD Canada 1.0253-58 1.0249-53 +0.04 1.0263 1.0240 +0.45
AUD/USD Australia 0.9743-46 0.9744-48 -0.01 0.9770 0.9726 -4.54
NZD/USD New Zealand 0.7505-08 0.7495-503 +0.10 0.7528 0.7490 -3.47

Euro Rate

EUR/JPY Japan 99.87-90 99.98-100 -0.12 100.16 99.74 +0.33

Source: ICAP Plc.


-By Takashi Mochizuki, Dow Jones Newswires; 813-6269-2782; takashi.mochizuki@dowjones.com

This should not come as a surprise....

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http://www.latimes.com/news/nationworld/world/la-fg-iran-nuclear-talks-20120524,0,6789325.story

Hope fades for quick progress in Iran nuclear talks
Tehran and six world powers clash in new talks in Baghdad, with Iran accusing them of not giving it a 'balanced' proposal.

By Paul Richter, Los Angeles Times

May 24, 2012
BAGHDAD — Hopes for quick progress on Iran's disputed nuclear program faded rapidly Wednesday, as diplomats from six world powers and Iran collided bitterly in daylong talks intended to resolve their long-standing differences over an effort many nations fear is aimed at building a nuclear bomb.

In their second high-level meeting in as many months, representatives of the two sides offered packages of proposals designed to open a path to what is expected to be a long and difficult negotiation. But the yawning gap between the two sides quickly became apparent.

The world powers pushed Iran to give up key pieces of its nuclear program, and the Iranians complained that the six nations were not offering them a "balanced" proposal.

After discussions that lasted from 1 p.m. to midnight at a government guesthouse in Baghdad's international zone, a senior Obama administration official acknowledged to reporters that "this has been a difficult day."

Though the two sides agreed to reconvene Thursday, the clash illustrated how far the parties have to go to reach even the interim "confidence building" agreement that some U.S. officials had hinted might soon be within reach.

U.S. officials insisted that the difficult exchanges weren't surprising and might even be a sign that the sides are finally willing to engage candidly over their differences.

But if the talks collapse, as they did in January 2011, the consequences could be dire. Israel and the United States have both said they might turn to military action to halt Iran's nuclear program if diplomacy does not provide assurances that Tehran is not trying to build a bomb.

U.S. officials demanded in their proposal that Iran halt production of uranium enriched to 20% purity, a material that can be relatively easily converted for use in a nuclear bomb. They asked that Iran surrender its stockpile of such uranium and dismantle an underground site near Qom where 20% enrichment is occurring.

The world powers — the United States, Britain, France, Germany, Russia and China — offered to refrain from imposing further United Nations sanctions on Iran, but did not offer to suspend the tough U.S. and European sanctions on Iran's central bank and oil industry that have sent the Iranian economy into a tailspin in the last six months.

Officials have said they could take such steps only after Iran made irreversible moves to curb its nuclear program and came into compliance with U.N. Security Council resolutions.

Iran responded with its own package of five proposals, some dealing with the nuclear program and others with nonnuclear issues. But Iranian officials immediately began claiming the six-nation proposal was not "balanced," the official Islamic Republic News Agency reported.

In recent months, Iranian officials have repeatedly pressed for the world powers to provide relief on the sanctions and have declared that enrichment is their right under the Nuclear Nonproliferation Treaty, to which Iran is a signatory.

The senior administration official, who declined to be identified because of the sensitivity of the subject, said the conflicts were not just about the sanctions, but also about the demands regarding 20% enrichment and other issues.

"I would have expected nothing but for them to say that this was 'unbalanced,' " the official said. "This is a negotiation in which we both want to get the most and give the least."

But the official added that the harsh words were a sign that, unlike in the past when the two sides have often avoided direct discussion, "you're getting down to the issues that matter.… I take that as a good sign, not a bad one."

Both sides still have powerful reasons to want to keep the negotiations on track. The sanctions are battering Iran's economy, and the Obama administration knows that a failure of the talks could invite an Israeli attack on Iran that could set off a regional war, drive up oil prices and imperil the global economic recovery and President Obama's reelection bid.

U.S. officials and other Western diplomats predicted after the meeting that the sides would schedule more meetings. But the clash highlighted how many pitfalls may lie ahead as the world powers try to deal quickly with the problem.

Iranian and U.S. officials did not have a bilateral meeting during the session, though others did. The senior administration official said such a meeting would have been unlikely, given the two nations' bitter history. Still, such a session would have been an encouraging sign that Tehran wanted to work out its points of tension with Washington.

Ray Takeyh, a former administration advisor on Iran, said the Iranians probably have now gotten the signal that they will have to make sacrifices to settle an issue that has upset numerous nations.

"The Iranians are hoping to do a little and get a lot back," he said in an email. "It was useful for [the world powers] to disabuse them of that illusion."

He predicted that the talks will continue.

"Both sides have laid out their opening positions and much haggling will continue to take place, I suppose," he said.

paul.richter@latimes.com

Copyright © 2012, Los Angeles Times

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Security situation: Cabinet panel to probe assault on Karachi rally
By Sumera Khan
Published: May 24, 2012

ISLAMABAD:

The death of 13 people following an attack on a peace rally prompted the federal cabinet on Wednesday to constitute a special four-member committee to look into the law and order situation in Sindh, and particularly this incident.

The cabinet also formed another special committee to look into security issues in Balochistan.

The committee for Sindh will be headed by federal minister Makhdoom Amin Fahim and include Maula Bukhsh Chandio, Naveed Qamar and Khursheed Shah. The committee members will hold meetings with Sindhi nationalist party leaders to address their concerns over a prospective Mohajir province.

The committee on Balochistan will be headed by Law Minister Farooq H Naek. The prime minister, chairing the session, directed both committees to present their recommendations at the next cabinet meeting.

Later, in a separate meeting, Interior Minister Rehman Malik briefed Prime Minister Yousaf Raza Gilani on the situation in Karachi following Tuesday’s attack. The premier directed Malik and all federal agencies to track down the culprits and bring them to justice.

Cabinet decisions

Finance Minister Dr Hafeez Sheikh gave a presentation to the cabinet on the energy situation in the country and the premier directed the law ministry to draft necessary legislation to deal severely with issues of power theft and defaulters.

Sources said that Mian Manzoor Wattoo suggested that CNG stations should be shut down for three months to tackle the gas crisis which is causing severe damage to the industries.

The cabinet congratulated the president on his ‘successful’ participation in the Nato Summit in Chicago and expressed satisfaction over the outcome of the visit of the Turkish prime minister to Pakistan.

The cabinet also reviewed the implementation status of its various decisions.

The meeting was informed that 67% of decisions pertaining to States and Frontier Regions Division and 84% of those pertaining to the Board of Investment have already been implemented.

Kaira’s briefing

Briefing the media after the meeting, Information Minister Qamar Zaman Kaira dispelled the impression that ministers belonging to the Muttahida Qaumi Movement had boycotted the cabinet meeting, and said they had some engagements in Karachi.

He also insisted that “reopening” of NAB references against the Sharifs was not “political victimisation” since the references were originally submitted under former president Pervez Musharraf’s regime.

“The Sharif brothers should not be afraid of facing the courts … they are the luckiest in Pakistan who always received justice in time,” Kaira said.

Published in The Express Tribune, May 24th, 2012.

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New IAEA Report: Iran Installing Centrifuges in Fordow
The IAEA will publish new report concluding that Iran installed 350 new centrifuges at the Fordow underground facility since February.

By Elad Benari
First Publish: 5/24/2012, 6:15 AM

Western diplomats said on Wednesday that the International Atomic Energy Agency (IAEA) has concluded that Iran installed 350 new centrifuges at the Fordow underground facility since February.

The diplomats said, according to reports in the Israeli media, that the IAEA will reveal this information in a new report to be released on Friday. The installation of more centrifuges has increased the Islamic Republic’s potential to enrich uranium.

The remarks were made after Iran and the P5+1 traded proposals in Baghdad on Wednesday, as a new round of talks over Tehran's controversial nuclear program got underway.

Iran is keen to ease sanctions on its vital oil ministry and central bank by Western nations, who have said they are unwilling to give up their key leverage point without a comprehensive agreement.

Ahead of talks the P5+1 - the five permanent members of the UN Security Council plus Germany - indicated they may be willing to limit their demands to Tehran halting enrichment to 20%, shipping all uranium enriched to 20% out of the country, and closing the highly fortified Fordow facility.

The Islamic Republic admitted last year it was moving more centrifuge machines for enriching uranium to the underground facility, which is carved into a mountain to protect it against possible attacks.

The existence of the facility near Qom only came to light after it was identified by Western intelligence agencies in September 2009. The UN’s nuclear watchdog has confirmed that Iran begun enriching uranium at the plant.

In March, IAEA chief Yukiya Amano said that a tripling on the enrichment of uranium at the Fordow nuclear site, along with Iran’s rejection of IAEA attempts to inspect nuclear facilities, point to concern that the Islamic Republic might be developing nuclear capability for other than peaceful purposes.

On Tuesday, it was reported that Iran will sign an agreement to cooperate with the IAEA nuclear watchdog agency.

Yukiya Amano, director general of the International Atomic Energy Agency, returned to Vienna after a one-day visit to Tehran and announced that “a decision was made to conclude and sign the agreement. I can say it will be signed quite soon."

Foreign Minister Avigdor Lieberman expressed skepticism over the agreement, saying the Iranians are trying to create a more pleasant and relaxed atmosphere during negotiations but that their goal remains the same - to obtain nuclear weapons.

“While sanctions on Iran have an impact, it is not enough of an impact to bring a real change in the situation,” Lieberman said. “We should also pay attention to the negative Iranian involvement in every possible place in the Middle East.”

Earlier, Defense Minister Ehud Barak also expressed doubt over the value of an agreement between the IAEA and Iran.

“It appears that the Iranians are trying to reach a ‘technical agreement’ which will create the impression of progress in the talks, in order to remove some of the pressure before the [P5+1] talks tomorrow in Baghdad; as well as to put off the intensification of sanctions,” Barak said.

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Iran Nuclear Talks Hit Snag
Posted Wednesday, May 23rd, 2012 at 9:00 pm

Continuing talks between Iran and global powers have hit a snag as the West rebuffed Tehran's call for an immediate easing of economic sanctions and official Iranian media said the proposals on the table needed to be significantly revised.

The negotiations in Baghdad were extended for a second day into Thursday, as U.S. and European officials said they remained committed to finding a solution to the impasse.

Western representatives presented a package Wednesday that calls on Tehran to freeze production of nuclear fuel enriched to 20 percent purity, considered a short step away from weapons grade. The plan also seeks to close an Iranian enrichment facility built inside a fortified military bunker near the holy city of Qom.

In exchange, the P5+1 group offered benefits, including medical isotopes, some nuclear safety cooperation and spare parts for civilian airliners, much needed in Iran. The P5+1 includes the five permanent members of the U.N. Security Council plus Germany.

The Iranian side indicated that ending impending Western sanctions on Tehran's oil trade is key for the talks to advance. But diplomats from the six world powers have refused to consider postponing the new harsher measures.

Iran's state-run IRNA news agency said Tehran presented its own package Wednesday, including details on what mutual compromises Iran and its international counterparts should make.

IRNA criticized the proposal from the six-nation group, saying it makes too many demands of Iran while offering too little in return.

Iran said its enrichment work is meant for medical research and generating electricity. Western nations fear Iran could quickly upgrade its uranium to the 90 percent purity needed for nuclear weapons.

Baghdad University professor Said Dahdhoh told VOA's Kurdish service that Iran wants the talks to be comprehensive and focus on more than just the nuclear dispute. He said Tehran also wants the West to clarify its stand on Bahrain and other regional issues.

Shi'ite Iran has strongly criticized plans by Bahrain's minority Sunni leadership to seek a political union with Sunni-dominated Gulf states. Bahrain's ruling family is an ally of Washington that provides the U.S. Navy with a key regional base.

World powers have insisted for months that talks focus solely on the disputes with Iran's nuclear program.

This is the second round of a dialogue that resumed last month in Istanbul after a break of more than a year.

Published reports say the six-nation group is reviving a 2009 proposal for Iran to ship out its stockpiles of low-enriched uranium in return for higher-enriched fuel for a medical research reactor in Tehran.

Iran is seeking pledges from the world powers to ease U.N. and Western sanctions imposed on the country for defying international demands for a suspension of enrichment.

Israel sees a nuclear-armed Iran as a threat to its existence and refuses to rule out military action against the Iranian nuclear program.

Israeli officials have urged the world powers not to compromise on their demand for a stop to Iranian enrichment work. Those officials also have expressed concern that Iran will make empty promises of concessions to buy more time to covertly develop nuclear weapons.

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Obama's 'Pak/Af' problem
May 24, 2012
SAIDA FAZAL
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Business Recorder Logo President Obama has been very upset with Pakistan for not opening the Nato supply routes - so upset that he refused to meet with President Asif Ali Zardari during the Nato summit in Chicago.

If American press reports are to be believed, his men had told Nato Secretary General Anders Rasmussen as well not to talk to the Pakistani President.

This, of course, deeply upset our 'mercenary brigade', which has been warning of dire consequences of not letting the superpower have its way.

But the second day of the summit must have brought them some cheer.

While circulating in the conference hall, Obama stopped for a brief chat with Zardari and Afghan President Hamid Karzai, whom he had already granted a special meeting on the summit sidelines.

Obama is offended because Islamabad is setting conditions to the reopening of Nato's Ground Lines of Communication.

After all, Pakistan has been in a mercenary relationship with the US, and mercenaries are not supposed to make any demands, unless they are related to money matters.

So the request for increasing the price of Nato containers from $1500 to 5000, although unacceptable, is negotiable.

An American team is already in Islamabad haggling with our officials to settle the issue.

Causing friction are two other demands: one that the US apologise for the attack on its 'major' non-Nato ally's soldiers at the Salala border post, which left 24 men dead; and second that the CIA cease its drone operations in Pakistani territory that have killed and maimed many more civilians - men, women and children - than militants.

Arrogance of power prevents Washington from tendering an apology for killing our soldiers.

Even if he wants, we hear, Obama cannot afford to do that in an election year.

He is already facing criticism for apologising to the Afghan people for American soldiers' desecration of the Holy Quran.

As per American politicians' proclamation, the sole superpower must never apologise.

Accepted etiquette requires that only small nations apologise to big powers.

The problem for Zardari & Co is that this is an election year in Pakistan as well, and the people are seething with rage over Salala and indiscriminate drone attacks in the tribal areas.

The government does not want to be seen standing alone whilst the Opposition parties insist it honour the Parliament's policy review recommendations that call for both an apology and an end to drone strikes.

Hence, in his speech at the Chicago conference, Zardari averred that "we are bound by the advice of our Parliament and the democratic forces", hastening to add that "our Parliament has spoken in favour of co-operation and a partnership approach"

Meanwhile, efforts have been on to break the deadlock.

Turkish Prime Minister Recep Erdogan flew in Saturday on a special mission to convince 'the democratic forces' to drop their resistance to the lifting of the blockade.

After attending some formal events during the first two days of his visit, he spent Tuesday - in a bid to elicit their agreement for unblocking the supply routes - meeting with important opposition leaders, like the PML-N leader Nawaz Sharif, JUI-F chief Maulana Fazl-ur-Rehman and former Jamaat-e-Islami Amir Qazi Hussain Ahmad.

Later addressing a joint news conference with his Pakistani counterpart, he backed Islamabad's demand for an unconditional apology.

Which means some sort of a face saving apology will soon be forthcoming through Nato, of which Turkey is a member, rather than Washington.

The rational would be that even though the forces involved in the Salala attack were American, they operated under the Nato banner.

As for the drone strikes, the Americans are still unwilling to stop them despite the claim that almost all al Qaeda leaders, except Ayman al Zawahiri, have been eliminated.

Just yesterday, ie, Wednesday a drone fired missiles on a house in the Tabai area of Miranshah in North Waziristan, causing four casualties.

This was the third such strike since our Parliament approved new guidelines as part of the policy review of Pak-US relations.

They are unlikely to stop because for several years drone attacks went on with the tacit approval of both our civil and military leadership.

The thinking in Washington seems to be that if drone attacks were OK before, they should not be such a big problem now.

It is worthwhile to note here the finding of the famous American think-tank the Brookings Institution that drones kill "ten or so civilians" for every militant killed.

Another public policy institute, the New American Foundation, estimates the casualties caused by drones in Fata are in the range of 1,793, to 2,781 (excluding the latest attacks).

The last figure is about the same as that of the 9/11 atrocity victims - which the US used to cause more than a decade of death and destruction in this region.

But Pakistan's own leaders have been selling Pakistani lives cheap, telling the Americans they need not worry about the 'collateral damage'.

So we can expect to see the pricing and apology issues resolved sometime soon, and the drone strikes to go on, irrespective of the anger and hate they generate.

The good news for our mercenary brigade is that Obama is more interested in Pakistan than in Afghanistan.

An article adapted by the New York Times from its chief Washington correspondent David E Sanger's book, "Confront and Conceal: Obama's Secret Wars and Surprising Use of American Power" due out early next month, offers a good understanding of Obama's thinking.

According to the author, in the first days of the presidency Obama asked a team headed by Bruce Reidel, a former CIA officer and an expert on this region, to lead a rapid policy review.

And the "central insight" of the team was that "Pakistan posed a far greater threat" than Afghanistan.

After turning in his report, Reidel said "if we are honest with ourselves, we would call this problem 'Pak/Af' not 'Af/Pak'." As for Afghanistan, according to the author, by 2011 Obama had concluded that the Pentagon had not internalised that the goal was not to defeat the Taliban.

Instead he is quoted to have said that he "believed that we had a more limited set of objectives that could be accomplished by bringing the military out at a faster clip."

But Obama, the writer goes on to note, "was placing an enormous bet: his goals now focus largely on finishing off the al Qaeda and keeping Pakistan's nuclear weapons from going astray." As per Washington's own claims, al Qaeda has almost been finished off in the 'Pak/Af' region.

Yemen now is its centre of gravity.

But how does Obama plan to keep Pakistan's nuclear weapons from going astray? Think of the increasing violence and chaos everywhere - in Karachi, Balochistan, and Khyber Pakhtunkhwa.

Think also of the contents of Haqqani's memo and his escape to Washington, the mercenary brigade's defence of him and his bosses, and the picture starts falling into place.

saida_fazal@yahoo.com

Copyright Business Recorder, 2012

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Egypt votes on second day of landmark election

By Samer al-Atrush (AFP) – 2 hours ago

CAIRO — Egyptians vote on Thursday in the second day of a gripping presidential election in which candidates are pitting stability against the ideals of the uprising that ended Hosni Mubarak's rule.

Polls are scheduled to open again at 8:00 am (0600 GMT) for voters to choose among 12 candidates, with the front runners divided between Islamists who say they will champion the uprising's goals and Mubarak-era ministers.

Voting in 13,000 polling stations takes place over two days in order to accommodate more than 50 million eligible voters.

On Wednesday, after a slow start, cooler evening temperatures and the end of the work day prompted a surge in voters, who wound their way through streets outside polling stations across the country.

Two of the candidates are expected to go into June run offs after the May 23 and 24 vote, with pollsters saying the number of undecided voters makes the result of the first round extremely difficult to predict.

After decades of pre-determined results, for the first time, the outcome of the vote in the Arab world's most populous nation is wide open.

The next president will inherit a struggling economy, deteriorating security and the challenge of uniting a nation divided by the uprising and its sometimes deadly aftermath, but his powers are yet to be defined by a new constitution.

Among the contenders is former foreign minister and Arab League chief Amr Mussa, who is seen as an experienced politician and diplomat. But like Ahmed Shafiq, Mubarak's last prime minister, he is accused of ties with the old regime.

The powerful Muslim Brotherhood's candidate, Mohammed Mursi, faces competition from Abdel Moneim Abul Fotouh, a former member of the Islamist movement who portrays himself as a consensus choice with a wide range of support.

Several of the candidates broke an election committee period of silence during the polling to shore up their chances and attack others, with Shafiq warning of a "huge problem" if the Islamists get into power.

Pollsters say many of the undecided voters who say they will cast ballots are likely to make up their minds at the last minute or be swayed by the candidate who has the best network in mustering votes.

The election caps a roller-coaster transition, marked by political upheaval and deadly bloodshed, but which also witnessed democratic parliamentary elections that saw Islamist groups score a crushing victory.

Ballot boxes from Wednesday will be kept overnight in the stations, which election commission officials will seal with wax overnight and leave under military and police protection.

Results are expected on Sunday.

Copyright © 2012 AFP. All rights reserved. More »

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The Guardian - 20 hours ago

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In a Sudanese field, cluster bomb evidence proves just how deadly this war has become
Aris Roussinos speaks to the villagers demanding UN help
Aris Roussinos

Thursday 24 May 2012

The villagers of Angolo were gathered around the crater, mournfully staring at the bomb when we arrived. For over a month, the Russian-made cluster bomb has sat in the centre of this quiet farming village in Sudan's restive Nuba Mountains, its clutch of unexploded submunitions spilling from its belly into the red African soil. A makeshift attempt at cordoning off the scattered bomblets with a low circle of stones had little visible effect, with cattle and barefoot children moving unhindered through the long grass.

"Where is the West, where is the UN?" cried an elderly man, leaning against his spear as he gestured at the bomb. "How are we to clear this from our village? We need experts, and help from the outside world."

But South Kordofan's Nuba tribesmen have little hope of outside intervention. The UN's mandate to operate in Sudan's war-torn rebel provinces is heavily constrained by the government in Khartoum, and since South Sudan's declaration of independence in July 2011, little overt assistance is coming from their former allies a few dozen miles across the border.

Our minders from the SPLA-N, the Nuba guerrilla army fighting the Sudanese government, were keen to take us to Angolo, in the hope that that evidence of this bomb strike – the first ever confirmed use of cluster munitions in the South Kordofan conflict– might increase international pressure on Khartoum. Many quoted Libya as a model for intervention.

"When the West helped the thuwwar (revolutionaries) in Libya, they defeated Gaddafi in six months," says Abdul, a second lieutenant. "But we have been fighting the Arabs for 20 years with no help from anyone. Where is Obama, where is Merkel, where is Sarkozy?" News of the former French president's political demise has not yet reached this isolated mountain region.

Neither Sudan nor South Sudan is a signatory to the 2008 convention banning the use of cluster munitions, but the deployment of such indiscriminate weapons so close to civilian homes is widely considered a crime against international law. But, already wanted by the International Criminal Court for war crimes in Darfur, with a plummeting economy in Khartoum and a shrinking hold on the Nuba region, Sudan's embattled leader Omar al-Bashir may feel he has little left to lose.

"We are already in control of 75 per cent of the Nuba Mountains," said Abdul, as the sound of rebel artillery pounding the government-held town of Talodi echoed across the arid hills. "Now Bashir says he wants to come to pray in the mosque in Kauda. Kauda is our capital. Well tell him we are waiting, waiting for Bashir to come to pray," he laughed, "and we will hit him, and hit him all the way to Khartoum."

But the Angolo cluster bomb provides a mute rebuke to the SPLA-N's optimism. Without modern anti-aircraft weapons, the Nuba tribesmen have no answer to the Sudanese Air Force, which strikes the region daily with impunity. Local farmers have learnt to tell the difference between the slow lumbering throb of Antonov cargo aircraft, which drop unguided munitions from their rear ramps on the Nuba villages in contravention of international law, and the jet roar of MIG fighter bombers, which at least provide some degree of accuracy.

"Even just before you came here this morning, they bombed us," claimed a villager, who refused to give his name. "They bombed us in Abdey and the place called Jabrona, near here." Though The Independent heard an Antonov fly over the valley that morning, the villager's claims were impossible to verify, and indeed many aspects of the Angolo bomb strike remain mysterious.

The villagers said the air strike took place on 15 April, but were divided over whether an Antonov or MIG jet delivered the bomb. But the fact the bomb failed to explode at all is the greatest puzzle for munitions experts who have examined photographs of the incident.

The Angolo bomb is a Soviet-made RBK-500 cluster weapon, filled with dozens of spherical A0-2.5RTM submunitions, designed to burst in half on impact and scatter shards of shrapnel and ball-bearings over a wide area.

Each hemisphere of the bomblet is designed to achieve a "kill radius" of 20 metres, yet there were no reported casualties in the attack or after, and none of the submunitions appear to have exploded.

Perhaps the relative obsolescence of the bomb led to its malfunction. The serial numbers visible on the undeployed submunitions indicate that they were manufactured in Russia's Degtiarev plant in 1984.

Human Rights Watch observed a high failure rate for these submunitions in Russia's 2006 conflict with Georgia, though there is no known precedent for such a complete failure of this type of bomb in an airstrike. Even if the civilians of Angolo had a lucky escape, there were little grounds for optimism.

"There used to be many people in the Angolo, but many have gone to Yida [the UN-run camp just across the border struggling with a growing exodus of Nuba refugees] because of the bombing," said one.

Most of the village's straw-roofed huts seemed empty, with only a few women and children watching their menfolk at the bombsite from the safety of their mud-daubed compounds.

The terror effect of aerial bombing on South Kordofan's civilians has a brutal military logic. Like any insurgent army, the SPLA-N fighters rely on their civilian support base to grow and rear food, draw water from the abundant wells and gather firewood for fuel.

If the flood of civilians to refugee camps like Yida empties the region of its civilian population, the SPLA-N will be forced to draw supplies from South Sudan along the single vulnerable dirt track they still hold.

This narrow lifeline will become impassable when the already-overdue summer rains finally break, and convoys of military trucks were seen rushing equipment north, notably heavy-duty tyres.

The SPLA-N intend to hold their positions in the face of Bashir's much-advertised summer offensive, and hope to gain ground in the counter-offensive. Ordinary soldiers loudly protested their high morale.

"We shall go to the forests, and carry our guns, and we will liberate our country so that we can chase them back to Asia, where the Arabs come from," said Tariq, 23, a student turned fighter.

Then, shouldering his rifle, he fell back into line with his comrades as they trudged in single file across the dusty mountain path. As the soldiers marched, they passed empty hut after empty hut along the trail to their secret headquarters. Most of the villagers had long fled.

Channel 4 News will also report the story tonight at 7pm