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Saturday, July 28, 2007

Tough prawn import restrictions defended



The federal government has defended its tough new quarantine measures for imported prawns.

The controversial restrictions on the importation of raw prawns have been implemented to reduce the risk of disease entering the country, maintains fisheries minister Eric Abetz.

"Imports will need to come from sources recognised by Australia as free from disease or concern, or be tested for a wide range of diseases," he said.

Imports of highly processed prawns will still be allowed – namely battered, marinated or cooked prawns.

Local prawn fishermen and farmers have welcomed the mesures, but seafood importers have accused the government of acting to protect the domestic industry, not the consumer.

"We're getting screwed politically," said Harry Peters, chairman of the Australian Seafood Importers Association.

The group's 40 members handle about 80% of seafood imports from nations including China, Thailand, Vietnam and Norway.

The importers claim that if more onerous tests for diseases that infect prawns, not people, are required, China, Vietnam and Thailand will pursue the case with the World Trade Organisation. "They've already discussed this with the WTO in Geneva last month," Peters told The Australian.

He said the new tests were unreliable and would cause safe shipments to be rejected. "No importer can afford to bear the loss of a $250,000 shipment," he said. "This is nothing but political bastardry."

"Nowhere in the world at any time in the last 100 years has a disease been transferred to living prawns by dead prawns,” he added.

But fishermen and prawn farmers have welcomed the changes. Scott Walker, head of the Australian Prawn Farmers Association, said the measures would protect the nation's $600 million prawn market.

"Government testing of imported raw prawns late last year found 100% were carrying exotic diseases," he said. "All of Australia's valued crustaceans... are susceptible to these diseases."

Queensland Seafood Industry Association president Neil Green described the measures as "vitally important" to the industry.

The revised quarantine measures are expected to be in place by September.

Bush creates panel to review import safety






The White House on Wednesday ordered the formation of an import safety panel to review strategy in the wake of a series of consumer and food product scares that have raised concerns over the safety of products from China.

President George W. Bush formed the import safety working group, comprising government agencies, and asked Michael Leavitt, secretary of health and human services, to chair the group and report back in 60 days.

"The world is changing, and in order to make sure that we can continue to have the confidence of our consumers, we will continually review practices and procedures to assure the American consumer," the president said. "This is a serious issue."

World Energy Solutions Expands R&D Facility to Accelerate Time to Market With Diesel Fuel Reduction Technology

ST. PETERSBURG, Fla., July 25, 2007 (PRIME NEWSWIRE) -- World Energy Solutions, Inc. (OTCBB:WEGY), a company focused on energy conservation technologies and environmental sustainability, announced that additional money has been allocated for the enlargement and expansion of the company's Research and Development facility in St. Petersburg, Florida.


The expansion will enable WES to accommodate large vehicles for the installation of the company's proprietary fuel additive systems, principally the hydrogen/oxygen additive to diesel engines. Additionally, World Energy Solutions' expansion will enable the company to carry out the manufacturing of large technical hardware without having to sub-contract component manufacturing. The expansion will include the acquisition of a range of machine tools and associated ducting and electrical supplies. The first new machine tools are expected to be delivered and commissioned by the end of July, 2007. The rearrangement of the laboratory will be completed by mid August, 2007.

Management expects that the expanded R&D facility will significantly increase the speed of production of components for new product prototypes. Additionally, the specification of component parts can be made more exact and the new plant and machinery will enable the laboratory staff to work to higher manufacture tolerances than would be possible with outsourced components.

Ben Croxton, CEO of World Energy Solutions, Inc., stated, "WES management hopes to create a more efficient production environment for the development of new components. We anticipate there will be significant cost and time savings, as well as the production of higher quality parts.

Recently Reported News

World Energy Solutions (WES) has begun retrofitting a new 2007 Ford F-650 with the company's proprietary hydrogen/oxygen system to reduce the truck's fuel consumption and harmful emissions. The company has entered the diesel engine market to capture the strong commercial demand for the company's proven hydrogen/oxygen (HHO) powered internal combustion engine technology. The expansion of the WES R&D facility is anticipated to speed up this development.

About World Energy Solutions, Inc. (WES)

World Energy Solutions, Inc. (OTCBB:WEGY) is an Energy Services Company and electronics manufacturer. WES's primary business focus is the development of technology for lowering electrical, gas and water usage for commercial, government and residential facilities. For more information about WES please visit its website at www.wesinc.net.

Forward-Looking Statements

Certain matters discussed in this press release are 'forward-looking statements.' These forward-looking statements can generally be identified as such because the context of the statement will include words such as 'expects,' 'should,' 'believes,' 'anticipates' or words of similar import. Similarly, statements that describe World Energy Solutions' future plans, objectives or goals are also forward-looking statements. Such forward-looking statements are subject to certain risks and uncertainties, including the financial performance of World Energy Solutions, which could cause actual results to differ materially from those currently anticipated. Although World Energy Solutions believes the expectations reflected in any forward-looking statements are based on reasonable assumptions, they cannot give any assurance that their expectations will be attained. Shareholders, potential investors and other readers are urged to consider these factors carefully in evaluating any forward-looking statements. Certain factors could cause results and conditions to differ materially from those projected in these forward-looking statements, and some of these factors are discussed below. These factors are not exhaustive. New factors, risks and uncertainties may emerge from time to time that may affect the forward-looking statements made herein. These forward-looking statements are only made as of the date of this press release and World Energy Solutions does not undertake any obligation to publicly update such forward-looking statements to reflect subsequent events or circumstances.

The Geostrategic Import of the Coming Bay of Bengal Naval Exercise

Come September, India will host a major naval exercise in the strategic Bay of Bengal, located between mainland India, Bangladesh, and the western shores of Myanmar, Thailand, and Malaysia, Indian Defense Ministry officials report. The war maneuver will bring together naval forces from four other countries: Australia, Japan, Singapore, and the United States. The 20 warships that will participate include two nuclear aircraft carriers from the United States, the USS Nimitz and USS Kitty Hawk, and one non-nuclear carrier from India, the INS Viraat. In addition, the five-day maneuvers will also see in action shore-based Jaguar deep penetration strike aircraft of the Indian Air Force and the Indian Navy's Sea Harrier jets and Sea King helicopters from the INS Viraat. Indian defense officials point out that the location of the planned naval exercise has been chosen to maintain distance from the arc of the Pacific Ocean, and skirts the borders of Russia and China where such moves could arouse Beijing's sensitivities.

From all available accounts, it can be assumed that the September naval exercise will be the biggest held in the region by far. Last April, the United States, Japan, and India conducted their first joint naval exercises off the Japanese coast. That was a one-day goodwill exercise, as one Indian official pointed out, and did not involve many maneuvers. The Mysore, an Indian guided-missile destroyer, along with two U.S. destroyers and three escort ships of Japan's Self-Defense Force (SDF), were among the vessels that took part in the exercise off Chiba prefecture (state) on Japan's eastern coast, according to Japan's Defense Ministry. No doubt the September exercises will be dramatically different.

A Troubled Area
The maneuvers will take place at a time and place of great instability, much of which has spun off from the Anglo-American reactions to the 9/11 event. Not far from where the September exercise will take place is the Persian Gulf, the cockpit of the current Iraq conflict, and potential attack on Iran.

The situation in Iraq is deteriorating every day, and the fear of involvement of citizens, if not of the governments of Iraq's neighbors, in this civil war looms large. The presence of about 200,000 foreign troops, of which 170,000 are from the United States, and almost 30,000 private, armed security forces, mostly from western countries, have not succeeded in drawing down the level of violence which exceeds 100 deaths every day in Iraq.

East of Iraq, the United States and the NATO member-nations have been engaged for over five years in trying to physically eliminate the Islamist Taliban militants, who have been entrenched in Afghanistan since 1996. The invaders' self-proclaimed war on terror was launched soon after the 9/11 event. Having achieved a quick military victory in the Winter of 2001, the foreign troops find themselves getting increasingly bogged down by insurgents who can no longer be identified simply as the old Taliban. As a result of the presence of almost 50,000 foreign troops, and an explosion of opium production unprecedented in the history of Afghanistan, violence has spread far and wide. The upheaval has spilled over into bordering Pakistan, making a section of that nation ungovernable. The anti-U.S. and anti-foreigner insurgents, under the garb of being Islamic extremists, have now launched an attack against the powers-that-be in Islamabad.

Sandwiched between Iraq and Afghanistan is Iran, which is very much in the cross-hairs of the United States. Iran is also under pressure from the European nations, for engaging in a uranium enrichment program, ostensibly to power its future nuclear power plants. Influentials within the United States, belonging to the bloodthirsty faction represented by Vice President Cheney and some of the neo-conservatives, are exerting pressure on the White House and the Pentagon to use all means, including military, to bring about a regime change in Tehran. They are now in the process of developing a theory that says that no solution to Iraq or Afghanistan is possible unless the evil regime of Iran is uprooted.

Because of this relentless campaign of the Cheney-led cabal, and the Iranian unwillingness to give up uranium enrichment, a war-like situation has come to prevail in the Persian Gulf. As of now, the United States Fifth Fleet has two aircraft carrier strike forces lodged in the Persian Gulf, and the third carrier strike force, under the USS Enterprise, is on its way. The arrival of the USS Kitty Hawk in 40 days or so, in the Bay of Bengal, which is in striking distance of the Persian Gulf, raises fears of more military activities in the region in the coming weeks.

Signs of Unease
Looking at the scorecard before us, as well as the map, there is clearly good reason to become uneasy when the Bush Administration talks about security and stability. There is no question that under the Bush Administration, U.S. nuclear doctrine has been undergoing radical redesign, to further the imposition of a new imperial order. The U.S. move toward setting up a missile interception system in central Europe is correctly seen as part of this shift. Military sources have told EIR that the most radical aspect of that redesign has been the consolidation of offensive nuclear warfare capabilities, with both missile defense and current and future space-war capabilities.

Thus, the September naval exercise is likely to make nations in Eurasia, particularly Russia and China, suspicious. Although Russia, a close and long-term ally of India, has not expressed any discomfiture officially, China, with which India is in the process of developing a better mutual trust and understanding, has.

There's a recent history to China's reaction. The U.S.A., India, Japan, and Australia met in May on the sidelines of the Association of Southeast Asian Nations (ASEAN) Regional Forum in Manila to set up a new "quadrilateral" grouping. Although no agenda was set up for the talks, these quadrilateral consultations drew Chinese ire. Beijing issued protest demarches (formal diplomatic communications) to each of the four states.

The meeting was preceded by a joint statement on May 1 by U.S. Secretary of State Condoleezza Rice, Defense Secretary Robert M. Gates, Japanese Foreign Minister Taro Aso, and Defense Minister Fumio Kyuma, who spoke about a common strategic objective of continuing to build upon partnerships with India to advance areas of common interests and increase cooperation, recognizing that India's continued growth is inextricably tied to the prosperity, freedom, and security of the region. Since then, Indian Prime Minister Manmohan Singh has said India is not "ganging up" against China, and that the quadrilateral group is "not a military alliance." Subsequently, Australia's Defense Minister Brendan Nelson has tried to allay Beijing's fears, saying there was no quadrilateral security alliance comprised of Australia, the U.S.A., India, and Japan in the offing.

But that is unlikely to satisfy Beijing, which fears that Washington is fashioning a "China containment" strategy involving India, Japan, and Australia. The Bush Administration's record, and the nature of the Cheney-led cabal in the United States, naturally worry the Chinese.

What also concerns Beijing is the growing military interaction between the U.S. military and that of India. While the naval exercise is one major event, it is evident that India is becoming increasingly addicted to the U.S. and Israeli arms and equipment and technologies associated with these. Last year, the Indian Navy made its first big procurement from the United States by purchasing the 17,000-ton USS Trenton (LPD-14), an Austin-class amphibious transport dock. Recently, Indian defense officials said Washington has offered the giant landing ship, USS Nashville, to the Indian Navy, and New Delhi has shown interest.

U.S.-Indian Military Relations
There's no question that the U.S.-Indian military relationship has grown by leaps and bounds in recent years. As pointed out recently by the U.S. Ambassador to India David Mulford, since 2002, the United States and India have been partners in more than 30 military exercises. At the recently held Aero India 2007 air show in Bangalore, American high-technology systems were brought to India by U.S. defense companies, which, in an impressive display, highlighted the next frontier of their desired military relationship.

At Aero India 2007, U.S. defense companies demonstrated flights of the F-16 and F/A-18A fighter jets, the C-17 heavy-lift aircraft, the naval reconnaissance P-3 Orion, and the CH-47 Chinook cargo helicopter. More than 20 U.S. companies, including Boeing, Lockheed Martin, General Electric, and Raytheon, well known for their respective technology and defense manufacturing, were present at the air show. Recently, Lt. Gen. Jeffrey B. Kohler, director of the Defense Security Cooperation Agency in the U.S. Defense Department, was in India. He told news reporters in Delhi that India and the United States are close to signing an agreement under which their armed forces will provide each other logistics support on a reciprocal basis. Kohler said the accord had been presented to India's Cabinet Committee on Security. The Americans usually describe such a pact as an "acquisition and cross-services" agreement. It was listed as a logistics support agreement at the suggestion of India, he said.

"The agreement will ease joint operations by the armed forces of the two countries during exercises and in coming to the aid of people struck by natural calamities," Kohler said, making it clear that the accord did not in any way imply the stockpiling of weapons on each other's soil.

"The armed forces of the two countries are having frequent interactions and face immense difficulties by way of fuel supplies and other logistics. With such an agreement in place, it would ease things for both militaries," he said. The U.S. has signed similar agreements with 65 countries, including a recently concluded pact with India's neighbor Sri Lanka.

Israel, the American Proxy
Moreover, India's growing relations, military in particular, with Israel, which is considered an American proxy in that part of the world, is often bracketed as part of the Indian-U.S. relationship. India has started a $2.5 billion joint venture with Israel to develop an advanced range surface-to-air missile capable of detecting and destroying hostile aircraft, missiles, and spy planes, news reports said. India's Cabinet Committee on Security, chaired by the Prime Minister, approved the project between the Defense Research and Development Organization and Israel Aerospace Industries for developing the missile system. Over the years, India-Israel arms and military relations advanced quietly. Israel is now India's second-largest supplier of arms, Russia still retaining its number one position. Recently, an Indian warship visited Israel, and a seven-member Israeli delegation, led by Deputy Chief of the General Staff, Major Gen. Moshe Kaplinsky, was in the disputed state of Jammu and Kashmir, to the utter dismay of the anti-Indian Kashmiris and the Pakistanis.

Discussions with the visiting army delegation on that occasion focused on anti-militancy operations in the region and also on how the Indian army is challenging the infiltrators from Pakistan across the Line of Control (LoC). India has followed Israeli advice and fenced with barbed wire the 720-km-long LoC with Pakistan.

Security: An Urgent Need
On the other hand, there is little doubt that to enhance security in the Indian Ocean and Pacific Ocean rim countries, naval cooperation between the United States (with the world's largest navy at its disposal), India, Japan, and Australia is an urgent necessity.

A very important element in all this is the steady development of India-Japan relations. Recently, Japan has committed itself to a nearly $100 billion Delhi-Mumbai industrial freight rail corridor. It is said that when Japanese Prime Minister Shinzo Abe visits India in August, the project will come alive.

In recent years, New Delhi has observed a changing mood in Japan's governments. Unlike the insular and chauvinistic underpinnings of its rise in the pre-World War II era, Japan today is different, and trying to develop a foreign policy of its own. What prompted Japan's focus on India, evident from Japan's recent diplomatic overtures and initiatives, can best be answered by Japanese policy-makers. But, it is clear that Japan and India are likely to become close partners in coming years, based on common values and strategic interests.

One analyst, Anirudh Suri, in an article in the Asia Times, recently noted that the rise of China, and increasing tensions between China and Japan, have altered Japan's sense of complacency. Tokyo has therefore become more proactive in taking leadership in Asia, seeking Asian partners to limit, if not contain, China. Building on former Prime Minister Koizumi's January 2002 proposal for a new Asian regionalism based on the promotion of market economics and democratic values, Prime Minister Abe has envisaged an "Arc of Freedom and Prosperity," made up of democratic nations lining the outer rim of the Eurasian continent, Suri wrote.

But, despite Japanese concerns, neither Japan nor India are likely to be railroaded by the United States' anti-China cabal, into a policy of "ganging up" on China.

The 'Trust Deficit'
Nor is India likely to become a trusted ally in other Anglo-American war drives.

One complication is the U.S. relationship with Pakistan, whose armaments the U.S.A. is modernizing. Washington has delivered two F-16 fighter jets to Pakistan, and will hand over another 24 shortly, the U.S. Embassy in Islamabad has announced. These join 34 F-16s already in Pakistan's armory.

The delivery of F-16s did not create an anti-American fervor in India, but New Delhi firmly believes that Pakistan's desire for modernized weapons is for the single purpose of challenging India, which considers a hostile and well-armed Pakistan, friendly to China, to be a strategic threat to India.

Last April, at a two-day workshop at the Indian Defense Studies Analysis (IDSA), a New Delhi-based think tank, discussions took place on emerging U.S.-Indian strategic relations. One Indian analyst pointed out that although Indians are eager to obtain U.S. technology, a "trust deficit" still exists, based on past U.S. sanctions on India, and Indians worry that at a crucial time they might not be supplied with replacement parts if the relationship goes bad again.

At the same time, it was pointed out at the conference that India is in fundamental agreement with the idea of the U.S. Chief of Naval Operations for allied naval cooperation (referred to as the 1,000 ship navy), and in fact has already engaged in some activities compatible with that goal, including tsunami relief, patrolling the Straits of Malacca, and evacuating refugees from Lebanon. Lieutenant General Kohlers' " 'acquisition and cross-services" agreement is also geared in that direction.

A senior Indian military official delivering a luncheon address to the conference cautioned that Indo-U.S. relations are likely to remain fluid, and unpredictable. He asserted that those relations can be better described as an "evolving entente," and argued that given its size, location, and ambitions, India will always march to the beat of its own drummer.

The official stated that when dealing with a potential conflict situation, the Indian political and civil leadership tends to follow a restrained, consensual approach on the domestic as well as international level. He added that India's primary effort is invariably to shape the security environment through cooperative peace, rather than plan on the basis of inevitable armed conflict.


Suspense mounts as Brazil presents World Cup bid

RIO DE JANEIRO, July 27 (Reuters) - Brazil, the only candidate bidding to host the 2014 World Cup, will make their presentation to FIFA on Tuesday, when they should unveil some concrete plans rather than simply recall the past.
Until now, the Brazilian Football Confederation (CBF) has concentrated on the political side of the bid and emphasised their country's unparalleled World Cup tradition.
They have hosted the World Cup once before, in 1950 and have been world champions five times.
However, the CBF has not publicly disclosed which cities it proposes to use as venues, nor how it and local authorities intend to overcome the country's chronic infrastructure problems.
The poor state of Brazil's major stadiums could still be a major stumbling-block -- but that appears to be the least of the country's problems at present.
CBF president Ricardo Teixeira will make the presentation with his nation's air transport system reeling from two major crashes in the last 10 months.
The last two weeks have seen hundreds of delays and cancellations as the recriminations continue following the July 17 crash of a TAM Linhas Aereas flight, which killed around 200 people at Sao Paulo's main domestic airport.
With many major roads in an appalling state and railways suitable only for freight transport, it remains a mystery how players, officials and tens of thousands of fans will be ferried around the vast country.
Urban violence is another major worry, especially in Rio de Janeiro, Sao Paulo, Salvador and Recife.
It is not yet known whether Teixeira's presentation will clarify the issues or simply repeat the old discourse about how Brazil deserves the World Cup on its tradition. Either way, it will know FIFA's thoughts on Oct.30 when the world governing body announces its 2014 decision.
POLITICAL EFFORT
South America is due to host the 2014 cup under FIFA's rotation system and Brazil have been favourites to stage the event since 2003 when they were backed as the continent's only candidate by the other nine national federations.
Colombia briefly changed their minds last year and launched their own bid, before pulling out.
However, Brazil can take nothing for granted as far as 2014 is concerned. FIFA president Sepp Blatter has said on more than one occasion this year that FIFA would consider hosting the World Cup "north" of Brazil if Brazil could not meet FIFA's exacting demands to stage the tournament.
So far, Brazil appear to have concentrated their efforts on the political side including winning the backing of their neighbours.
Two months ago, Teixeira visited the governors of Brazilian states who had expressed interest in hosting games.
They were presented with FIFA's Hosting Agreement, a 92-page document detailing all requirements including 10 requiring formal government commitment.
The Brazilian government was quick to sort out the bureaucratic side, pledging to meet FIFA requirements on questions such as visas, work and import permits.
But the logistical problems remain unaddressed and loom uncomfortably on the horizon.
Teixeira's presentation will come two days after the end of the Panamerican Games in Rio de Janeiro, which tested the country's organisational capabilities on a much smaller scale.
Facilities, including the newly-built Joao Havelange stadium, were widely praised.
However, distances between venues were often huge, the results and transportation systems took several days to crank into action and authorities failed to keep their promise to expand the city's limited metro network.

Oil buys a round trip to Dubai

When international oil prices pushed past US$75 (NZ$93) a barrel a year ago, it was feared that the crippling burden of high energy costs would end the world economy's dream run.


The crunch never came. Despite several years of strong global growth, last year's oil price record was not primarily driven by excess demand, but was instead the result of expectations of shortages to come.

In the end, those predictions were proved wrong, oil prices dropped back to below US$60 a barrel by the end of last year, and concerns about growth dissipated.

However, the downward price correction did not last long. Leaving the usual volatility aside, oil prices have been going up again since March.

This time, prices seem to be driven by actual supply shortages rather than expectations.

In response to softening prices last year, Opec – the 12-member cartel of oil-producing and exporting countries that provides about 40 per cent of global oil supply – cut its production quota by 1.5 million barrels a day.

On the other hand, over the past 12 months the buoyant world economy has added another one million barrels a day to demand.

Even though oil prices are back around US$75 a barrel, this time there seems to be less concern about global growth.

That may reflect a certain attitude that "we've been there before and it didn't do any harm".

However, last year the price rise was short-lived. This time it may be different. Opec appears determined to maintain tight supply, with its members sticking to the agreed production quotas. That is a change from previous years, when it was common practice to cheat on the cartel.

Alternative oil producers can't come to the rescue. Many years of under-investment, the faster-than- expected depletion of North Sea oil reserves, and the dismantling of Russian oil exporter Yukos are only some of the reasons behind the International Energy Agency's projection that non-Opec oil production will remain flat for the next five years.

Opec will not review its supply quotas till September, but the cartel is acutely aware that pushing its luck too hard may slow world growth and hurt revenues.

However, so far there is little evidence of that.

AS IS often pointed out, if one takes inflation into account, real oil prices were actually higher in the late 1970s and early 1980s.

However, leaving that brief period aside, the real cost of a barrel of oil is now more than double the average over the past 30 years.

The decline in the relative intensity of oil use over that period has provided some offset.

Furthermore, most economies now experience relatively low inflation, interest rates and unemployment, which could explain the apparent resilience to the oil shock.

The tipping point may not come till central banks decide to add to the pain by raising interest rates in an attempt to contain inflation pressure from rising energy costs.

In that situation, Opec could literally turn on the tap fairly quickly and cause prices to drop.

Present spare production capacity is estimated to be about three million barrels a day, which undermines some analysts' predictions that oil will reach US$95 a barrel.

The more likely scenario seems to be a range between US$65 and US$75 a barrel over the next year.

What does all this mean for New Zealand?

Four years ago, when global crude prices were sitting below US$30 a barrel, New Zealand's annual import bill for oil was about $2.8 billion. Since then, oil consumption has risen by only 7 per cent, but the import bill has risen to more than $5 billion on the back of record oil prices.

If it were not for the unprecedented strength of the New Zealand dollar, that amount would be significantly higher.

Present petrol prices reflect the sheltering influence of the exchange rate. Last year, when international crude prices were at similar levels, a litre of 91 cost $1.77, compared with about $1.55 today.

The full effect of the global oil price shock will not be felt till weak economic data finally convinces the Reserve Bank to lower interest rates and the New Zealand dollar reverses its bull run.

If the currency settles at its long- run sustainable level of just below 60 cents, the annual oil import bill will end up being about $3 billion higher than it was in 2003.

Ironically, that is close to the amount Dubai Aerospace has offered for the majority share in Auckland International Airport.

It is even more ironic that New Zealand predominantly imports crude oil from Dubai.

One could argue that our economy as a whole would effectively recycle the proceeds from the airport sale back to Dubai to pay for the increased cost of a year's worth of crude oil.

Would that be a particularly cynical view of the world, or simply describe the unpleasant economic reality of the situation?

In A Bug-eat-bug World, Researchers Use Unique Chinese Wasp To Battle Soybean Aphids


University of Minnesota scientists are field testing a beneficial insect, a stingless wasp from China also known as Binodoxys communis, that kills soybean aphids. A successful field test would be a major breakthrough in controlling a damaging crop pest. The U of M received permission from the federal government to conduct this test and is the leading institution in the testing.

The soybean aphid first appeared in Minnesota fields in 2000 and today costs soybean growers an estimated $200 million annually in lost crop yields and spraying costs in Minnesota alone. The national cost is much higher.

"The soybean aphid was imported without any of its natural enemies, the organisms that keeps aphids in check in China," said Dave Ragsdale, U of M entomologist. "Our researchers and Extension experts are working to provide that check and balance system."

Multiple stages of evaluation and testing have been completed at the Insect Quarantine Facility, a joint effort between the Minnesota Department of Agriculture and the Minnesota Agricultural Experiment Station on the U of M's St. Paul Campus. Special security and air filtration systems ensure the insects being evaluated don't venture out on their own. Field testing will take place in a limited number of grower fields and at Research and Outreach Centers.

Binodoxys communis was approved for release based upon four years of laboratory safety testing. It is an especially promising species for control of soybean aphid, because it comes from a region in China that is a good climate match to Minnesota. The stingless wasp specializes in soybean aphid and has been observed apparently controlling it in China.

A cooperative effort between the U of M, the state and soybean growers, like New Richland farmer Larry Muff, have made this experiment possible.

"The soybean check off is committed to supporting research that will mitigate this devastating pest," said Muff, co-chair of the Minnesota Soybean Research and Tech Transfer Committee. "Organic growers will also benefit from this biological control of aphids."

University researchers and Minnesota Department of Agriculture scientists will monitor the ability of Binodoxys communis to kill soybean aphids this summer and continue the attack this fall when soybean aphids move to buckthorn plants and survive the winter to battle soybean aphids in 2008.

The researchers also have a backup plan. Eleven other species and strains of stingless wasps are under evaluation and some of these that have shown promise from both a safety and efficacy standpoint may be field tested in 2008.

In the wrong direction

The following newspaper articles, "The real reason developing countries stay poor" (February 23, 2007) and "Trade Liberalisation must not be to the detriment of the region" (February 23, 2007) were interesting and instructive commentaries on globalisation.

The first article discusses issues regarding "gangster" capitalism and a campaign for the non-repayment of some foreign loans by developing countries. In the second article, against the background of the outcome of the recent election in St Lucia (my emphasis), the prime minister of Antigua and Barbuda warned that "trade liberalisation must not be to the detriment of the region". The prime minister is not alone regarding concerns about the backlash of globalisation. The World Trade Organisation (WTO) has produced "Trade Liberalisation Statistics", a report providing data on some of the negative consequences of globalisation.

According to the report, "the following facts are culled to demonstrate that current trade liberalisation rules have led to increased poverty and inequality, and have eroded democratic principles, with a disproportionately large negative effect on the poorest countries". Activists and researchers in the USA, England and Australia have recorded their findings on the impact of globalisation on education. There is also discussion on the new regimes emerging in South America and other parts of the world as responses to globalisation, and also the need for new directions in politics of the coming of the "New new world order".

Researchers have argued that to date there are no clear links between liberalisation and economic growth. "This means that the projected benefits (of liberalisation) are merely hypothetical. Globalisation has features common to the past junctures of "free-trade" emergencies. In looking at studies of Imperialism by JA Hobson, VI Lenin, H Madgoff and particularly Johan Galtung's Structural Theory of Imperialism, it is reasonable to label globalisation as a new form of imperialism. From my observations, globalisation is an Anglo-American construct which emerged after George HW Bush (Transforming US Security Environment) and Margaret Thatcher (A European Magna Carta) had their meeting in Aspen, Colorado, in the early 1990s (Aspen Quarterly, Spring 1991). The New World Order by Paul Nitze was one of the major presentations to the conference (Aspen Quarterly Spring 1991). It was indeed the manifesto of things to come. It was this combined "axis ideas" from Thatcher and Bush Snr that formally ushered in the era of globalisation.

Thatcher expressed with clarity the idea that it is the politics of the developing countries "which have led the economics astray". International regimes were now empowered to help some countries "govern". Prior to this meeting, we were taught about the "rust belts of America" and the "declining and industrial and mining activities" in England. The system was set to ensure prosperity for the Anglo-American axis.
Studies associated with the WTO illustrate how these "untested hypotheses" have eroded "democratic principles", and led "to increased poverty and inequality". According to the report, the number of people living "on less than US$2 per day has risen almost to 50 per cent since 1980" and that the "UN estimates that poor countries lose about US$2 billion per day because of unjust trade rules. trade liberalisation is negatively correlated with income growth among the poorest 40 per cent of the population." and ". if rich nations opened their markets to the Least Developed Countries (LDCs), increased opportunities would generate an estimate of $700 billion of additional trade for the developing world".

Developing countries "face higher tariffs on processed goods than on commodities". Most developing countries are dependent on commodities in a world in which "commodity prices have fallen dramatically, by some two-thirds over the past 30 years." Rural underdevelopment and an ever increasing rural unemployment generate new forms of poverty. It is this new form of poverty, new culture of individualism and greed in a world of "high consumerism" that is of great concern, particularly as factors associated with new and very high levels of crime. There was a clear example of how the negative consequences of globalisation in St Lucia deepened inequality and poverty, resulting in very high levels of homicide.

Opposition leader Bruce Golding spoke about "anaemic growth" in Jamaica in spite of the significant amount of Foreign Direct Investment (FDI) to this country. But according to WTO data and analysis, "There is no causal link between foreign direct investments and poverty reduction. Eighty per cent of FDI is in the form of mergers and acquisitions, little in the form of productive investment that creates jobs and exports". The majority of LDCs with strong import liberalisation "have experienced anaemic or negative growth over the past 20 years".

It is "dangerous in general to depend on theoretical benefits which are unlikely to occur when human life is at stake, for example with water privatisation". It has been proved that privatisation of utilities to "gangster capitalists" has resulted in higher cost to consumers, poorer quality and even the absence of services where citizens of those countries were unable to pay. This has been the case in areas such as Puerto Rico, Bolivia and Argentina. Studies by Peter McLaren, Meg McGuire and Glen Rikowski and Geof Hattam et al inform on the negative impact of the WTO and GATS on education in England, Australia and the USA, respectively.

There was a sustained demonstration by students in Greece against "the conservative government's plan to reform higher education" in recent months. Many of the calls to reform education, today, are responses to WTO and the General Agreement on Trade in Services (GATS).

The new regimes emerging in South America are manifestations of people seeking for new directions in politics and society. There are also clear indications of a type of "indecisive politics" in Europe. According to Drezner (2007) in "The New New World Order", with the shifts in the global distribution of power" the idea of unipolarity is a thing of the past because new forces in the world are shaping the future. Where will we stand in the "new new" scheme of things? What is the nature of our foreign policy with respect to the changing forces in international relations? If we stay in the same place all the time, we will not get anywhere.

Zimbabwe: Hoteliers Desperate for Food Import Licences

PLAYERS in the hotel and tourism industry have applied for licences to import food products to cushion themselves against shortages triggered by the government price controls.

The Financial Gazette understands that the hotel industry has started engaging the Minister of Environment and Tourism, Francis Nhema on the issue.

Rainbow Tourism Group chief executive officer (CEO) Chipo Mutasa told The Financial Gazette hospitality players were seeking permission to import food products such as beef, dairy products, flour, fish and wines.

"It will come in handy if we do not find any of the stuff on the local market. We do not want to compromise on our services," Mutasa said.

There has been a shortage of most basic commodities on the market following a blanket freeze on products by the government last month.

The government's move sparked panic buying and hoarding among consumers, resulting in empty shelves after producers failed to supply.

Mutasa said most hoteliers had experienced shortages but were mainly cushioned by their capacity to buy in bulk.

The government also banned the import and export of various goods with effect from August 1.

Statutory instruments 137 and 138 of 2007 bans the importation of goods such as beef, butter, cooking oil, milk, cheese, sugar, tea, wheat flour, ice-cream, fertiliser, cotton lint and hides and skins without a permit.

The situation poses serious challenges to the industry, once one of the largest foreign currency earners.

The tourism industry was beginning to regain its place as a key economic sector after suffering a downturn in the aftermath of the 2000 land reform exercise.

The local tourism industry also has to gear up for the 2010 World Cup taking place in neighbouring South Africa.

Shortages will compromise the status of the industry, which is expected to host regional and international visitors during the showcase.

Zimbabwe was recently rated among the top five destinations in Africa, according to recent nominations revealed by the World Travel Awards (WTA) for 2007.

The nominated countries included South Africa, Tanzania, Morocco and Egypt.

Zimbabwe to import 200,000 tonnes of maize from Tanzania

Dar es Salaam (Tanzania) Zimbabwe is to import 200,000 metric tonnes of the staple maize food from Tanzania to avert widespread food shortages following a poor harvest, Zimbabwe TV, monitored here Thursday, has reported.

“We will have maize coming in shortly from Tanzania,” Samuel Muvuti, head of Zimbabwe’s state-run Grain Marketing Board, said in Harare.

“As soon as everything is put in place, stocks should be arriving into the country through the (Mozambican) port of Beira, to cater for the southern part of the country,” Muvuti added.

The Tanzanian government, however, said it was not aware of this maize sale to Zimbabwe.

The Zimbabwe TV report also said efforts were underway to bring in another 400,000 metric tonnes of maize from Malawi.

In fact, according to an APA correspondent in Malawi, the process of transporting Malawi maize to Zimbabwe began in June.

So far the Malawians have trucked in nearly 100,000 metric tonnes of the staple to Zimbabwe, Malawi’s Deputy Agriculture Minister Binton Kuntsaira told APA on Thursday.

Last month, the UN Food and Agriculture Organisation (FAO) and the World Food Programme (WFP) said in a joint report that more than four million Zimbabweans - a third of the population - were in need of food aid.

In March Zimbabwe, once a regional breadbasket, declared that its 2006/07 farming season was hit by drought, meaning that the government would need to import hundreds of thousands of tonnes of maize.

Apart from the drought, President Robert Mugabe blamed the perennial food shortfall on Western sanctions imposed on him and his ruling party elite.

This followed the last presidential polls, which the opposition and Western observers alleged were rigged to hand Mugabe victory.

But Western critics say the situation is a direct result of the controversial land reforms in which the government seized at least 4,000 farms from white commercial farmers for reallocation to landless blacks.

Govt eyes tougher seafood import rules

The federal government has welcomed reports China will step up fish farm inspections after some trading partners blocked its seafood exports over contamination fears.

The government also indicated it would consider toughening Australia's import requirements.

The US Food and Drug Administration (FDA) last month began stopping all Chinese farm-raised eel, catfish, basa, shrimp and dace at its border, over concerns about high levels of antibiotics in the seafood.

It had identified widespread contamination of Chinese seafood with drugs including malachite green, nitrofurans and fluoroquinolone.

Malachite green is a cancer-causing chemical used by fish farmers to kill parasites, while nitrofurans is an antibiotic also linked to cancer.

Australia tests for malachite green in imported fish and for nitrofurans in prawns, but does not routinely test for fluoroquinolone contamination.

Microbiologists are concerned human bacteria will develop resistance to fluoroquinolone if it enters the food chain.

China, the world's largest producer of farmed fish, on Thursday said it was focusing on curbing antibiotic use.

China's state council passed draft rules on Wednesday to give local councils greater power to monitor firms and punish those found breaking the law.

It also promised greater international cooperation, better safety checks and greater openness with quality problems.

"Product quality and food safety have a bearing on people's health and their vital interests, trust in companies and (our) international reputation, and it must be paid the utmost attention," it added.

Fisheries Minister Eric Abetz's office said the minister was consulting with Australia's food regulatory body, Food Standards Australia New Zealand (FSANZ), about seafood imports.

"It is pleasing to see that Chinese authorities are stepping up their own regulatory regime and testing on this matter," a spokesman for Senator Abetz said.

"While Australia has a strong testing regime in place, we can understand the concern about this issue, and the minister is seeking advice from FSANZ."

The government this week announced it would strengthen quarantine measures for imported raw prawns to protect the local industry and marine environment, but the changes do not apply to other types of seafood.

From September, prawn imports will need to come from sources that Australia recognises as being disease and contamination-free, or else be subjected to tougher testing.

Mr Abetz's office said the changes applied to all importers, not just China, and there were no plans to reverse the decision.

Labor has attacked the government for failing to act on the US warnings, and called for increased testing of all potentially harmful contaminants.

Kingfisher's vision finds global results


Australia has its own stories of IT start-ups achieving great things, writes Garry Barker.

HEWLETT and Packard are the classic example. Jobs, Wozniak and the Homebrew Computer Club are part of the same Silicon Valley legend of global technology companies launched by youthful entrepreneurs in a suburban garage.

But Melbourne has its garage start-ups, too.

Rosmin Robertson and her husband Bruce have devoted 20 years of work, a lot of passion and some world's-first technology to the building of Kingfisher International, a leader in fibre optic test equipment with customers in 70 countries. They began work in their spare bedroom, and from there moved to their garage when business began to pick up.

Even before Kingfisher International was born in 1986, Bruce Robertson was drawn to, and perhaps driven by, the idea that the future of telecommunications lay not with copper wires, which every telco then used, but with fibre optic cable.

He developed an instrument for testing the integrity of fibre optic cables that was half the size and half the price of US-made competitors. Over time, he has continued to refine the instrument, which is now standard equipment for servicemen and maintenance engineers in more than 100 telcos around the world.

Research and development is the lifeblood of the company, Ms Robertson says. "We have to stay in front of competitors by constant research and development," she says.

The internet was then still in its infancy. It would be three more years before Sir Tim Berners-Lee would create the World Wide Web and launch the global communications revolution that has produced the greatest social change on this planet since the industrial revolution.

Back then broadband was a dream; only telecommunications visionaries saw optical fibre cables carrying today's torrents of data to consumer's homes. But Bruce Robertson did, and his entrepreneurial wife saw the commercial opportunity.

Kingfisher's customer list now includes many of the world's biggest telecommunications companies — Telstra, France Telecom, British Telecom, Telecom New Zealand and Sprint-Nextel in the US.

The garage entered the equation when they needed more space for their first five employees — growth sparked by a sale to, of all unlikely customers, for a tiny Melbourne instrument maker, the Boeing Aircraft Company of Seattle.

Ms Robertson was born in Eritrea, daughter of a prosperous merchant and clothing manufacturer. Her early education was in Italian schools in Eritrea but at the age of 14 she was sent to an English school in Addis Ababa. The country was riven by civil war and the capital was less dangerous than Eritrea.

Three years later, in 1979, she went to live with an aunt in London.

"I took up a secretarial course, but within six months I realised that wasn't me," she says. "I thought of being a lawyer, but I was talked out of that, and began a business course." Business has remained her forte ever since.

She met her English husband in London at a spiritual group. It was a Sufi group, a movement founded in India by Hazrat Inayat Khan devoted to harmony, illumination and happiness, principles that are strong in Ms Robertson's approach to business.

"Bruce was my brother's friend. Bruce migrated to Queensland and I came there in 1985 for a holiday. We met up and he proposed. I was 23. We went on honeymoon for six months, came to Melbourne, liked it and settled here.

"My visa did not allow me to take a job, but I could start a business," she says. "I registered the Kingfisher name (because they are birds of speed, power, responsiveness and beauty, and they are in almost every country) and thought of import-export."

Bruce got a job with FibreNet, a company using optical fibre. "But the boss told him there was no point in developing and starting a new way of doing things," Ms Robertson says. Bruce was a designer, and within six months he left to join PA Technologies, a Melbourne consultancy.

But he was consumed with the idea of a hand-held test instrument for fibre optics.

"I was developing my own business, and as a wife you hear, and so I said to him, 'all right, why don't you do it for me?', and that was the start."

Ms Robertson looked at the possible market, saw opportunity, and wrote the specifications, and had some cardboard models of the instrument made up to "see if the world liked it".

Along the way Kingfisher was accused of stealing its technology but successfully defended itself. "We had not copied anyone because no one else in the world was doing what we were," Ms Robertson says.

Their barrister in the case is the now celebrated silk, Julian Burnside, QC. "We pretty much could not afford him, but we did. He was interested in technology, and this was one of the few cases of its kind.

"My father helped us with finance to fight the case. They wanted to buy our technology but for us it was a matter of principle. We had stolen nothing, done nothing wrong."

Says Ms Robertson: "My childhood and upbringing taught me that life is short — I saw that in the terrible civil war in Ethiopia — so I believe you should make everything you do count.

"We all have to make a living. We have to earn our bread, but we also should enjoy life. We have one opportunity at life and we should get our life balance right."

She enjoys running her business and seeing it grow, but she does not believe that the harmony of her life and that of her family and employees should be sacrificed to growth and to making ever-greater profits. "You can't take your money into the grave; it's worthless there," she says.

The company has won an array of awards, including a Dun & Bradstreet and The Age Business award (in 1999) and Victorian Export Award, and was inducted into the Victorian Manufacturing Hall of Fame in 2005. Ms Robertson is a finalist for the Ernst & Young Entrepreneur of the Year award.

Developing science and engineering

CEBU, Philippines—For a country well into the 21st century, President Gloria Macapgal Arroyo’s promise of P3 billion for science and engineering research and development is a very blunt admission of the dismal state of knowledge production and technological expertise obtaining in higher education institutions in the country today.

Educators and academicians, therefore, cannot be faulted for eagerly awaiting the fulfillment of that promise, which she made in last Monday’s State of the Nation Address (SONA). But one skeptic I talked to yesterday commented wryly that if such an amount would still go through the government bureaucracy, nothing much will come of it as the vultures there would simply “filter” the whole amount for themselves. Ever the optimist, I am willing to give government the benefit of the doubt and see how this will play out.

Mrs. Arroyo’s offer, however welcome, is not new as it comes after a long line of presidential and American colonial) attempts at raising Filipino knowledge production to world standards. The success has been minimal at best as can be seen from the very few Filipinos that do get noticed the world over for contributing new things (inventions, innovations) or ideas (theories, philosophies, world-views) to make the world a better place, as it were. In fact, those who did were forced to sell their ideas to private firms who now reap profits after owning patents for these inventions.

Probably the most successful attempt at developing science (both social and natural) and engineering in a very backward country is Japan which, during the Meiji restoration, rapidly modernized to emerge an economic power within 45 years. This remarkable feat began when 15-year-old Emperor Mahutu, who took the name Meiji, assumed the throne in 1868 and promulgated the Five Charter Oath of 1868. A general statement of the emperor’s goals, the fifth oath is of particular import to the Philippines and to GMA in particular thus: “Knowledge shall be sought throughout the world to strengthen the foundations of imperial rule.” (I am, of course, referring to knowledge and not imperial rule here.) Overnight, over 3,000 teachers, engineers and scientists were imported to Japan from the U.S. and Europe while thousands of students went in the other direction to learn from the modern world. By the time of Emperor Meiji’s death in 1912, Japan had become an industrial power to be reckoned with.

The American colonizers also sent hundreds of Filipino scholars, called pensionados, to the United States, while an equal number of Americans began modernizing the Philippines. Many of the scholars came back to become the pioneers of higher education and research. But something happened along the way as many of them took on the appearance and aspirations of the colonial master at the expense of a vastly underdeveloped archipelago, creating a two-tiered society of English-speaking, American educated elite and a large number of barely literate compatriots.

Yet to a certain extent the country came out of the colonial experience and trained its Southeast Asian neighbors in the fields of agriculture, engineering and the social sciences. Vietnam, China and Thailand, from where we often import their surplus rice, learned the modern techniques of rice production from the Philippines, to cite one example.

That was in the 1960s, when all our neighbors (except Japan) were dirt poor and had little opportunities for economic growth. Forty years later, we look with askance as Malaysia and Singapore pour millions of dollars to develop their science and engineering programs carrying out world-class research and development while we produce nurses to earn money for the country abroad and many of our engineering graduates work in call centers, go abroad as domestic helpers, or go back home to farm. Obviously 3 billion pesos is not enough to close the gap with our neighbors. But that is surely a good beginning; that is, if it will not get lost in red tape and corruption.

A U.S. Customs and Border Protection officer under arrest

A U.S. Customs and Border Protection officer under arrest, accused of conspiracy to import a controlled substance. Federal authorities arrested Margarita Crispin while on duty at the Paso Del Norte Bridge. Authorities say she conspired with others to import more than 1,000 kilograms of marijuana into the United States from June 2003 to July 2007.

A Las Cruces police officer was killed in a motorcycle crash on Thursday night. Officials say David Cordova was driving his motorcycle and slammed into the back of a car. He died at the scene.

Two news helicopters crash in midair in Phoenix, Arizona while covering a police pursuit. The crash killed all four people aboard.

Across Texas, heavy rains are expected through the weekend in much of the state. Governor Rick Perry has sent National Guard troops to areas already hit by heavy rain.

Nasa says it is unaware of any astronauts who were drunk before a flight but agency is investigating.

Around the world, police in Pakistan used tear gas to disperse protesting racial radical Islamists at the Red Mosque in Islamabad.

The price of gas has dropped across the borderland.

An 18-wheeler that split in half along I-10 west near Executive caused a huge traffic back up. The incident happened around 9:30 a.m and left traffic backed up most of the morning and into the afternoon.

These are news headlines in the borderland, across the country and around the world for Friday, July 28th

Publish and debunk this relic of history

Seventy-four years ago this week, The Times started serialising the worst book ever written. Adolf Hitler had dictated Mein Kampf in Landsburg Prison in 1924, while incarcerated for his attempted putsch against the German Government. The book would not be published in Britain until October 1933, but this newspaper obtained the rights to run exclusive extracts four months earlier.

The Times explained that it was publishing this vile, anti-Semitic rant on the grounds that “readers will find it illuminating as a psychological revelation [which] will show how Hitler came to hate the Jews”. Even so, the Editor of the day, George Dawson, was plainly holding his nose as he placed Mein Kampf (“My Struggle”) in the public domain.

The accompanying editorial spoke of the author as a “fanatical anti-Semite” with “a few ideas, harshly created and stubbornly held”. It noted Hitler’s “revengeful fury” and the “cruel acts of savagery which have degraded Germany in the eyes of the world”. The editorial concluded: “The Hitler regime has actually been established by violence [and] legalised terrorism is still necessary to its maintenance.”


Few in 1933 could have foreseen the full scale of the horror that Hitler would shortly unleash, but there is a flicker of premonition in this newspaper’s palpable distaste. Dawson must also have wondered whether, in giving space to Hitler’s noxious ideas, he was also spreading and encouraging them. Was The Times justified in publishing Hitler’s tract? Or are there some words so ugly in import and so violent in intent, that they should be locked away? Is Hitler’s creed an ideological poison, liable to corrupt and contaminate anyone who is exposed to it? These questions have been asked about Mein Kampf ever since it first appeared, and it is an issue of fierce debate in Germany today, where Horst Möller, a leading German historian, has called for the book to be published openly for the first time since 1945.

The Bavarian state authorities own the copyright to Hitler’s writings, but maintain an effective ban by refusing all requests to print it. Officially, the book cannot be bought in Germany, Israel, Norway or Switzerland. It is illegal to own it in Austria and to sell it in the Netherlands. But the book is available for sale in the US and Britain, as well as through internet bookshops. About 3,000 copies are sold every year in the UK.

Mein Kampf is the central defining text of racial hatred, a lurid, paranoid diatribe founded on the lie of Aryan supremacy. It is not only evil but amazingly badly written, being repetitious, anti-factual, rambling and turgid, the testimony of a furious, self-pitying failure with a slender grasp on reality and none whatever on grammar. It was a huge bestseller: each newly married couple, graduating student, and soldier at the front was presented with a copy by the Third Reich; Hitler earned more than $1 million a year in royalties. It is wicked rubbish, at once stomach-turning and soporific; everyone should read it, once.

Holocaust survivors are understandably unhappy at the prospect of a book that caused such bloodshed becoming freely available once more in the country that gave birth to Nazism. Yet whatever sympathy one may feel for those who suffered, no book should be banned, however pernicious. Allowed to fester in the dark corners of neo-Nazism, Hitler’s ideas continue to hold a spurious glamour for the twisted few: held up to the light, they shrivel. In treating this disease, exposure to fresh air is always more effective than quarantine.

Some argued as much from the beginning. William L. Shirer, the American journalist and historian who covered the rise of the Third Reich, suggested that if Hitler’s ideas had been more widely disseminated and understood outside Germany in the 1930s, then the world might have taken action in time to stop him.

The Times was right to publish extracts from Mein Kampf in 1933; the publisher Hutchinson was brave and right to issue a cheap wartime edition in order that British people might better understand what we were fighting for, and against. And Mr Möller is surely right to argue that Germany has now left the spectre of Nazism so far behind, that it can trust itself to read Hitler’s creed without fear of reinfection.

Quite apart from the issue of free speech, there is the practical consideration that book-banning is virtually impossible in the internet age. The Nazis themselves tried, and failed, to ban and burn the “degenerate” books they feared, and in the process lent those works underground status. Today any neo-Nazi with half a brain (rather more than the usual complement), can download Mein Kampf and feel aggrieved and special for having to do so in secret.

The copyright of Mein Kampf in Germany will expire in 2015, and then German publishers will be free to publish it. How much better, then, to produce a cheap, scholarly, annotated version in German now, with a commentary comprehensively debunking it. That would be a mark of moral courage, a demonstration that Germany has come to terms with its past and can look on the evil of Nazism with confident disdain instead of a lingering fear.

Mein Kampf is a historical relic that has retained its power to horrify: it should be preserved and exhibited in the same way as Auschwitz, the killing fields of Cambodia and Holocaust museums everywhere. Germany has struggled to explore and understand its own history with an honesty that stands as a beacon to other traumatised nations, from South Africa to Iraq to Northern Ireland. Hitler’s apologia for mass murder is a painful but necessary part of that story. It should be published, and damned.

NZ threatens Aust over apple import delays

New Zealand is threatening to take Australia to the World Trade Organisation over delays to apple imports.

New Zealand's Trade Minister Phil Goff and Agriculture Minister Jim Anderton have scheduled talks next week to clarify Canberra's position.

If those talks fail Mr Goff says New Zealand will most likely refer the case to the WTO.

The myth of economic growth and inflation

U.S. Treasury Secretary Henry Paulson stated on 27th July, the week in which stocks in the US saw its steepest fall in five years:

“Now I believe what we’re seeing is a strong global economy. This is the strongest global economy I’ve seen in 32 years. The growth rate in Europe has doubled. We’ve got growth throughout Asia. Japan is now growing, so I think this is being driven by strong growth outside of the U.S.“

Is something fundamentally different indeed this time which forced a veteran like Paulson to state ‘strongest global economy in 32 years’ – since 1975?

Forecast by IMF has again given almost 5% global economic growth rate for 2008. The traditional cycle of overheating so far didn’t apply in China, and quarter after quarter its economy rather seemed to be accelerating, now reaching almost 12%. Asset prices all over the world, barring only gold and crude historically, did hit new highs with adjusted values of dollars with crude and oil historically.

And talks about economic imbalances – US deficits to China’s forex reserves – and their sustainability often get mentioned while examining the sustainability of present world economic growth.

However the other side of the story, with another news-article (couple of days back only, I don’t remember the source now) narrated a story on how ordinary Japanese people are suffering with the example of a 54-year old lady contractual teacher, who barely survives with the free lunch she gets at school, worth otherwise 200 yen-a-day. That article further analyzed how Abe government became unpopular within years of coming to power. Superimpose this picture with the reality of Yen-Carry trade and 0.5% interest rate in Japan, after years of zero-interest rate; and some +ve economic activities in Japan lately.

And hundreds of similar stories like that of the Japanese teacher asked questions whether economic growth benefits all. Many stated a rising tide does not lift all boats; and Warren Buffet suggested that all boats are rising; but the yachts are rising faster.
And the question that comes from this other side of the story is, if indeed global economy is in its strongest as per the measure of the economists; is it getting translated verbatim in the living of the ordinary people of the world – from US to Japan to China to India to everywhere?

So there remains essentially two questions (1) How long this growth would be sustainable and whether it indeed is different this time (true, a stupid notion), and (2) Whatever drives this growth; has it been good for the vast majority. If not; why so again?
Finding answer of 1st would help us explain 2nd question as well.

Back in June, taking cues from above facts, Moral of stocks up & housing down story appeared in BNN. Since then housing problem in the US has only worsened; and stocks, in-spite of their last week plunge; have decreased marginally. In the month of May’07, Dow Jones Industry Average touched 13K figure for the first time.

Another fad of the business media in between was to report on unsustainably high valuation of Chinese stocks. ‘Bubble in China? The answer is both ‘yes’ and ‘no’ covered those aspects, and since then China has also gone through some increased volatility; however no major downfall has been seen till now.

But none explain extensively the secret of this strongest global growth in 32 years. Have the economist (read Central Bankers) have suddenly found a magic potion on how to run the global economy better; or is it a mere accidental combination of factors that have fueled this so far ‘high-growth-low-inflation-era-with-economic-imbalances’, both within countries and more so within societies?

Simple questions seldom get any simple answers – these indeed are most profound. And probably no ‘right’ answer exists to above questions.

However chances are, both the alternatives (central bankers getting it right with coincidental developments) are right. Yes, indeed central bankers have played a role with easy liquidity; and China did offer a conducive environment by converting liquidity to productive assets, thereby giving a helping hand in controlling global inflation.

However another transition is taking place in-between. The definition of capital itself has undergone vast changes with easy liquidity. Spurt in interest rate in few major economies didn’t spoil the party of easy availability of liquidity (very lately, in-spite of liquidity being there, risk aversion caused by closure of hedge funds of Bear Sterns in subprime mortgage market has prompted less buyers of risky assets. However liquidity, without any doubt, still remains strong).

Capital so long meant resources – human or natural or even monetary ones (fiat currency, post Bretton Woods period). However seldom did we see an era when a vast majority of the capital created in human history originated primarily from the fiat currency part.
Capital (or resources) has now come to a status that can be created as much as Central Bankers of major economies (by ensuring first adequate domestic supply of goods) wishes. However flow of those monetary resources must be controlled, to keep a tab on inflation. So Japan still manages low inflation with 0.5% interest rate and tremendous liquidity with money flowing out in the form of ‘yen-carry’ trade; China manages inflation with investment boom in-spite of tremendous inflows and now planning its investments outside China to ensure the huge cash reserves are utilized elsewhere; US, in-spite of being a borrower sees its investment bankers acquire physical/financial assets in lucrative overseas markets.

It effectively means:

Ensure adequate domestic supply of goods (for China or Japan) or a strong currency (for US to keep costs of import low) to manage inflation. Lately though dollar has weakened a bit; the weakness is not of any significance compared what fundamentals suggest.
Once major economies and its Central Bankers achieve above, keep on creating resources through fiat channel. Print as much money as you can; but ensure much of that money is invested overseas in countries with weaker currencies. The world essentially does not mean the G-8; and much part of the world still remains starved of all the three categories of resources (human, natural or fiat currency. Natural resources, even if they exist, remain undeveloped).
Thereby major economies ensure that it owns up real resources (natural ones) in those underdeveloped parts of the world through artificially created ones; and by manipulating forex rates. China’s acquisition of assets in Africa is a glaring example; and so are US investment bakers backing real estate sectors in India.
So China invests heavily in Africa (no major economy with fiat strength there or with a strong currency); Japan does it all over, and US does it in China, India and to all over within its allies. The assets they acquire eventually come from either the poor governments; or the ‘have nots’ of those underdeveloped countries/societies. So the ‘haves’ acquire physical assets against fiat assets.
Effectively by this ‘magic potion’ formula of easy liquidity; central bankers of major economies can ensure their country owns up more and more assets all over the world. Asset ‘A’ in the US and Japan costs much more than same asset in India or China; and it even costs less in most of Africa. So similar natural resources, true with different geopolitical risks, get valued differently when measured with ‘artificially created resources’ in money markets.

The 2nd thing is, barring China, nowhere does firms report losses as they used to do historically. Auto-sector in US does face some troubles, but those are not from operations alone but more to do with employee welfares. Outputs of firms are already priced quite high; global demand also remains robust as increasingly the large section of ‘have nothings’ slowly converts to ‘have nots’ and to some extent to the ‘have’ section. So as long as firm output prices don’t come down substantially; firms even at present level of prices would make enough profits, with expanded capacities as well. And therefore inflation would be controlled; as China has done to the world.

Demand was always there; enough supply was not. As of now, creation of supply has not yet overtaken that demand to ensure that firms face pricing pressure; which in turn can cause firms to make losses; as business cycles usually meant historically.
So an expanding monetary policy where Central Bankers create resources or capital works well for all. The only victim, if any is nature as more the artificial assets we create with money supply; more is the demand generated and supply created (because pricing supports supply assuring profitability) from natural resources; and more is the pollution, Green House Gas emissions.

Nature never allowed any to consume today fruits of tomorrow. But when central bankers create resources with fiat money and still be able to contain inflation because existing price levels and demand justify that; we allow nature to suffer faster.

Much of the borrowings would never get repaid ever – be it by government or by firms. However no one is certain of the consequences when we borrow from nature beyond what nature can provide us in a sustainable manner; and ten we don’t even pay back. Government can run with perpetual debt; nature can’t.

The cost we pay to the nature for unsustainable borrowings may be much more catastrophic than the interest rate we pay on debts.

With still 3 billion people belonging to different categories of ‘have nots’ and therefore demand being there, firm profitability being higher and therefore encouraging more supply, liquidity being high to drive investments; the only real dampener, barring geopolitical risks that can topple this strongest growth cycle can only come from nature.
And it’s already happening.

And that partly explains why yachts are rising faster than boats in this economic growth cycle where we borrow more and more from nature to drive the strongest growth in 32-years. When central bankers can drive economic growth with easy printing of fiat money; the process logically continues with anyone with little ability to borrow by writing future checks.

People who could not borrow; people who consumed tomorrow’s fruit tomorrow and not today; mostly remained left behind from this Economic Growth

ADB to finance power projects in Pakistan

ISLAMABAD — The Asian Development Bank (ADB) has decided to support and finance import of about 2,000MW electricity to Pakistan from Kyrgyzstan and Tajikistan besides the pipeline project for import of gas from Turkmenistan.


Official sources said that the bank has found economically feasible Pakistan's plans of developing Gwadar port as transnational hub for Central Asian States (CAS), South Asia, China and the Middle East and has decided to fund at least three mega projects of the overall concept. These include import of 1,000MW of electricity each from Tajikistan and Kyrgyzstan and the Turkmenistan-Afghanistan-Pakistan (TAP) project.

The sources said the commitment for ADB's support and funding for the three projects has come at the highest level during recent interactions between Prime Minister Shaukat Aziz and the ADB president C. Lawrence. It was not yet clear how much investment would be required for the electricity import projects and what contribution would come from the Asian development, said these sources saying a technical level delegation would be visiting Islamabad in the next few days for more detailed discussions.

The ADB is assisting Kyrgyzstan and Tajikistan in development of their vast but untapped hydropower potential. It wants the two central Asian republics to export 1,000MW each to Pakistan that currently faces more than 2,500MW of power shortfall in peak demand timings. Energy demand growth rate is now estimated at 10 per cent per annum in Pakistan.

Pakistan has been in discussions with Tajikistan for import of about 1,000MW of electricity and has held at least three formal rounds of discussions on the subject. In one of the formal interactions, major stakeholders like the United States, Afghanistan, Russia and energy giants from the US and Russia had also participated.

The ADB has been working very closely with the World Bank in the recent days to create a regional electricity grid to ensure that surplus energy from one country in a specific country could be transmitted to another nation. There are many countries in the region which are surplus in energy in one part but short of electricity in another region.

Emagination Israel: bridging future generations with its challenges

Along with his two business partners, Nir Kouris is building and executing his vision to create three new experiences for people worldwide to explore and advance their technology side within Israel in a summer camp environment. The camp location is not yet public, however, the first camp for around 300 participants aged between 12 to 17 years is set to run in the summer of 2008. Half of the participants are expected to be Israelis and the other half from abroad. Kouris' second type of camp experience is a 'Technological Gadnat' for Israelis around 17 years of age and introduces them to personnel in the IDF's elite technological units. The third camp experience Kouris envisions is called Innovation Israel and is mainly for adults. Already in talks with prospective investors, strategic partners and philanthropic donors, Kouris feels "that Emagination Israel will make a major difference by exposing the young generation to the challenges of a world surging with technological advances, while simultaneously giving them the intellectual and practical tools to confront these challenges in creative and fun ways." An interview and business overview of Emagination Israel follows.

Overview: Emagination Israel: an international fun & high-tech summer camp.

The Challenge: in recent decades science and high-tech have been the success stories of Israel and this will continue into the future. However, increasing numbers of players are now competing in these fields globally, so Israel and the Jewish world must utilize its human potential and strive with great effort in order to remain at the forefront of technological advancements. Furthermore, one of our national goals must be to import the best minds from all over the Jewish world.

The Idea: We, the founders, believe that the way to achieve our potential is by focusing on the future generation: global Jewish youth. Reaching teenagers at a stage when their future is still malleable, like clay to the potter, makes it possible to provide inspiration, guide ambitions and integrate ideas into shaping a positive Jewish-Zionist identity. Only until the gates of the Israeli hi-tech world are opened to teenagers can they begin to truly envision Israel as a place where personal ambitions can be fulfiled and Jewish identities reinforced. Exposing high-caliber youth to these opportunities will ultimately help Israel lead in the fields of science and technology in the long-term and strengthen the bridge between Israel and the Diaspora.

The Solution: Emagination Israel is exactly geared to young minds. The summer camp introduces campers to an enriching experience that will touch their deepest emotions and spur creative energy. We provide an original, creative and fascinating program that matches Diaspora youth with Israeli peers in a unique way using universal language – Technology. During the summer of 2008, hundreds of teens from Israel and around the world will join together at Emagination Israel. The camp's program includes exciting workshops, rich in content that will enlighten imaginations and challenge curiosity in the framework of a fun experience that a summer in Israel can provide. The program is based on the knowledge and the experience gained from Emagination U.S., which has been operating hi-tech camps all over the USA for 25 years and has been adjusted for the Israeli-Jewish world and thereby merged with the Israeli hi-tech success story.

New World Syndrome

In Kosrae, an island in Micronesia, new arrivals are a curiosity, and it seemed that half the island had come to greet me and Steven Auerbach, a Manhattan-based medical epidemiologist and an officer in the U.S. Public Health Service who had worked in Micronesia in the early 1990s, when we visited last year. Dazed from our 8,000-mile journey, we groped our way down the pockmarked coastal road, driving past groves of trees bent nearly double under loads of bananas, papayas, and breadfruit. We were on our way to a funeral feast.

We arrived to find the feast in full swing. Young men in lawn chairs played cards, while toddlers squatted, transfixed, around a television screen blaring taped cartoons. Hovering women filled plates and wiped faces. Perhaps a hundred people were there, and the dead man's wife looked bored. The deceased, buried four weeks earlier in a nearby crypt, seemed almost beside the point.

Kosraeans die young (the man in the crypt was fifty-six), but not for reasons commonly associated with the developing world. There is no famine here, and with the notable exception of upper-respiratory infections, little evidence of the diseases that cut life short in, for example, sub-Saharan Africa. The big killer in Kosrae—what some epidemiologists call New World syndrome—is a constellation of maladies brought on not by microbes or parasites but by the assault of rapid Westernization on traditional cultures. Diabetes, heart disease, and high blood pressure—scourges of affluence that long ago eclipsed infectious diseases as killers in the West—have only recently appeared here.

Zimbabwe to import 200,000 tonnes of maize from Tanzania

Zimbabwe is to import 200,000 tonnes of the staple maize from Tanzania to avert widespread food shortages following a poor harvest, state television reported.

"We have got maize which will be coming in shortly again from Tanzania," Samuel Muvuti, head of the state-run Grain Marketing Board, told Zimbabwe Television late Tuesday.

"As soon as everything is put in place, stocks should be arriving into the country through the (Mozambican) port of Beira ... for us to also cater for the southern part of the country."

The report said efforts were under way to bring in another 200,000 tonnes from Malawi.

Last month, the Food and Agriculture Organization and the UN World Food Programme said in a joint report that more than four million Zimbabweans, a third of the population, were in need of food aid.

In March, Zimbabwe a former regional breadbasket declared the 2006/2007 farming season a drought year meaning the government would need to import hundreds of thousands of tonnes of maize.

President Robert Mugabe blames the perennial shortfall on drought and sanctions imposed on him and his ruling party elite following the country's last presidential polls which the main opposition and western observers charged were rigged to hand Mugabe victory.

But critics say the shortages were a direct result of controversial land reforms in which the government seized at least 4,000 farms from white commercial farmers for reallocation to landless blacks.

Beneficiaries of the land reforms often lacked the means and skills to farm, critics say, while others were holding on to fallow land for prestige.


Panel to turn Russia into global IT leader

MOSCOW: President Vladimir Putin has ordered the setting up of a high-level commission to devise ways and means to turn the former communist state into a global IT leader.

"Today we should act to obtain leadership. Russia has all the chances to be one of the global leaders in IT production by 2015," President Putin said, directing the setting up of a high-level commission by October 1 to look into "new specific spheres" to turn his country into an IT leader.

"We should search for new specific spheres, which will allow us to obtain parity and, in particular real technology leadership, first of all in software.

Our specialists are traditionally considered the best in the world," Putin said, adding that a free exchange of technologies and information is an important factor in strengthening democratic institutions and democracy as a whole.

"Certainly, this will require coordinated efforts by all bodies of power, representatives of business circles and civil society," the president said while chairing the Security Council session on Wednesday.

Referring to the national IT-project 'Electronic Russia' being implemented since 2002, Putin said that the country is now fairing better in the global competition, though much more was needed to be done.

He underlined the need to look for import substitutes for IT and IT-enabled products. "Import substitute is not a self-goal. But in this field (IT), which is related to national security, it's justified," Putin said..

Iberian Peninsula: Energy profile


Both Spain and Portugal have been members of the European Union (EU) since 1986. EU membership has led to an increased standard of living and economic growth in the Iberian Peninsula and billions of dollars worth of EU structural funds flowing into the two countries. Nevertheless, both countries continue to face economic challenges. Spain's unemployment rate remains stubbornly high, while Portugal has repeatedly exceeded the EU's limits on budget deficits.

Economic growth spurred by EU membership has led to increases in energy consumption. For example, Spain's energy demand has increased over 100 percent since the mid-1970s.

The Iberian Peninsula has limited energy resources, so both Spain and Portugal must depend upon imports for the bulk of their energy needs. Attempts to develop domestic energy sources, though, have focused on hydropower and renewables.

Both countries have also sought greater integration of the Iberian energy sector through policy coordination and infrastructure projects. The two announced in 2001 that they would create a single Iberian electricity market without limits on transnational ownership or market participation. However, repeated delays have pushed implementation of this market, called Mibel, until October 2007.

Oil

Spain and Portugal depend upon imports for almost all of their oil consumption. According to Oil and Gas Journal (OGJ), the Iberian Peninsula had a combined 150 million barrels of proven oil reserves in January 2007. Oil consumption in 2006 stood at 1.89 million barrels per day (bbl/d), with Spain contributing the bulk (84 percent) of that amount.

Even though oil consumption has increased in absolute terms over the past two decades, its percentage of total energy consumption has declined. Due to the lack of significant domestic oil production, Spain and Portugal depend upon oil imports, with the largest suppliers including Russia, Libya, and Saudi Arabia.

Sector Organization

The largest oil company in Spain is Repsol-YPF, created in 1999 through the merger of Repsol, the former, state-owned oil company of Spain, and Yacimientos Petroliferos Fiscales (YPF), formerly owned by the Argentine government.

The combined group is one of the world's largest integrated oil operators, with activities in over 28 countries.

After Repsol-YPF, Cepsa is the second-largest oil company in Spain. Cepsa has exploration and production activities in Algeria and Colombia, with future expansion planned in Yemen and Iran. The Compania Logistica de Hidrocarburos (CLH) is a private holding company for the domestic oil and petroleum products transportation system.

Ten oil and gas companies hold shares in CLH, the largest being Enbridge, Respol-YPF, and Cepsa.

The largest oil company in Portugal is Petrogal, a wholly-owned subsidiary of Galp Energia. Galp Energia is owned by the Portuguese government and a collection of international oil and gas operators.

Petrogal controls the domestic midstream and downstream oil sectors in Portugal, and it also maintains modest production activities in Angola and Brazil. In October 2006, the government completed an initial public offering of Galp shares that earned the government $1.4 billion, though it still continues to hold a small amount of Galp shares.

Exploration and Production

Spain produced only 3,000 bbl/d of crude oil in 2006, while Portugal had no commercial production. According to OGJ, Spain has seven active fields, all operated by Repsol-YPF: Alga, Ayoluengo, Barracuda, Boqueron, Casablanca, Chipiron, and Rodaballo.

Downstream Activities

According to OGJ, Spain has nine oil refineries with a combined capacity of 1.27 million bbl/d. The largest facility in the country is Cepsa's Cadiz refinery (240,000 bbl/d), though Repsol-YPF controls the largest refining capacity of any single company. Repsol-YPF and Cepsa also have joint ownership of a bitumen plant, Asesa, located at the Tarragona refinery.

Portugal has two refineries, both operated by Petrogal. Located in Sines and Porto, the facilities have a combined capacity of 304,000 bbl/d. Petrogal also controls the retail market for refined oil products and operates the country's oil pipeline network.

Biofuels

According to the Spanish Association of Alternative Energy Producers, biofuels represented 0.53 percent of transportation fuel sales in Spain in 2006. Ethanol represented the bulk of this total, followed by biodiesel. The group also reported strong biodiesel exports to the rest of Europe.

In March 2007, Natura opened a new biodiesel plant in Ocana, with a production capacity of 2,000 bbl/d.

Natural Gas

Natural gas consumption in the Iberian Peninsula has grown rapidly in the past decade. There are no significant natural gas reserves in the Iberian Peninsula. Spain only produced 5.6 billion cubic feet (Bcf) of natural gas in 2005, mostly from a single offshore field, Poseidon, operated by Repsol-YPF. Portugal does not have any commercial natural gas production, though there have been repeated exploration attempts in its offshore basins.

In 2005, Spain consumed 1.1 Tcf of natural gas. Natural gas consumption in the country has risen dramatically since the 1980s, and Spain has one of the fastest-growing natural gas markets in the world. Between 1994 and 2004, Spain's natural gas consumption tripled, driven mostly by the large-scale introduction of gas-fired power plants.

The Portuguese natural gas sector has also grown considerably over the past few years. Consumption was nearly non-existent prior to 1997, but in 2004, consumption of natural gas reached 152 Bcf. The increase in natural gas consumption can be attributed to the construction of import infrastructure, including pipeline links with North Africa and liquefied natural gas terminals.

Sector Organization

The largest natural gas supplier in Spain is Gas Natural (GN), the result of a 1992 merger between Catalana de Gas, Gas Madrid, and the gas infrastructure assets of Repsol Butano. Gas de Portugal (GdP), a wholly-owned subsidiary of Galp Energia, dominates Portugal's natural gas sector. GdP directly controls natural gas importation, transportation, and supply, while it indirectly controls distribution through its stakes in Portugal's six regional distribution companies.

Pipelines

Enagas operates most of Spain's domestic natural gas transportation system. Enagas controls 4,500 miles of pipelines in Spain, consisting of six main trunk lines that connect Spain's liquefied natural gas (LNG) and pipeline import terminals with the country's interior. As mentioned above, GdP owns and operates Portugal’s natural gas transmission system.

International Pipelines

Spain imports natural gas through two international pipelines. The Trans-Pyrenean pipeline, linking Calahorra, Spain to Lacq, France, began operations in 1993. This pipeline has a capacity of 330 million cubic feet per day (MMcf/d), allowing Spain to import natural gas from Norway via France. The second import pipeline is the 1,000-mile, 1.1-Bcf/d Maghreb-Europe Gas (MEG, also called Pedro Duran Farell). MEG, completed in 1996, connects Algeria's Hassi R'mel gas field with Cordoba, Spain, via Morocco.

In July 2001, a consortium led by Spain's Cepsa (20 percent) and Algeria's Sonatrach (20 percent) agreed to build the Medgaz natural gas pipeline, a second link between Algeria and Europe. The 120-mile, $1.3 billion Medgaz would link Beni Saf, Algeria to Almeria, Spain, with an eventual extension to France. In September 2002, the consortium completed a study of the line's feasibility, but delays have pushed back initial construction on the project. If completed, Medgaz would have an initial capacity of 770 MMcf/d. In 2007, a dispute between Sonatrach, the Algerian state energy company, and the Spanish government regarding Sonatrach’s ability to sell natural gas from Medgaz in Spain threatened to derail the project.

In June 2006, France's Total inaugurated the Euskadour pipeline linking the LNG terminal in Bilbao, Spain to Lussagnet, France. The system will allow Spain to re-export natural gas to the north. The 19-mile pipeline, running along the Bay of Biscay, has an initial capacity of 48 MMcf/d.

Portugal has two pipeline connections with Spain: Tarifa (1.08 Bcf/d) and Tuy (40.6 MMcf/d).

Spain is one of Europe's largest LNG importers. Enagas operates three LNG receiving terminals in Spain: Barcelona (2.5 Bcf/d), Cartagena (1.4 Bcf/d), and Huelva (1.7 Bcf/d). The Bahia de Bizakaia Group, a consortium of BP, Repsol-YPF, Iberdrola, and Ente Vasco de la Energia (EVE), operates an LNG terminal at Bilbao, with a capacity of 1.2 MMcf/d. The Sagunto LNG terminal, owned by a consortium of Union Fenosa, Iberdrola, and Endesa, has a capacity of 1.2 Bcf/d. In May 2007, the El Ferrol LNG terminal in northwest Spain received its first commercial shipment. The plant currently has a sendout capacity of 350 MMcf/d.

In October 2003, Portugal completed its first LNG terminal in Sines, with an output capacity of 530 MMcf/d of natural gas. The Sines terminal, operated by Galp Energia subsidiary Galp Atlantico, allows Portugal to seek greater independence of its natural gas supply, which is dependent on Spain's natural gas network to process and transport natural gas to the country.

Planned Facilities

There are three LNG regasification terminals proposed for Spain that are in various stages of the planning process. Engas is the proposed operator for a new facility in El Musel, in the Asturias region of Spain. Construction on the project could begin by 2009. In 2005, Compania Transportista de Gas Canarias (GasCan) completed an environmental impact assessment for its proposed LNG terminal on Tenerife, in the Canary Islands. That project would have an initial capacity of 33.9 MMcf/d and would mostly fuel a nearby power plant. GasCan also proposed building another LNG terminal in the Canary Islands, on Grand Canaria.

Electricity

Spain has seen a rapid growth in electricity generation from natural gas-fired plants. Spain produced 263.3 billion kilowatthours (Bkwh) in 2004, while consuming 241.8 Bkwh. The largest share of Spain's electricity generation came from conventional thermal plants, followed by hydroelectricity. There have been a number of new gas-fired power plants built in Spain in recent years to satisfy rapidly-growing demand.

In 2004, Portugal consumed 46.1 Bkwh and generated 42.5 Bkwh of electricity. Portugal has long depended upon hydropower to provide a large part of it electricity needs; however, hydropower's share of total electricity generation has declined from 53 percent in 1980 to 23 percent in 2004. The volatility and unpredictability of hydropower (see chart) has caused the Portuguese government to promote thermal generating capacity, especially natural gas-fired, as an alternative to hydroelectricity.

Sector Organization

Endesa is the largest power generating and distributing company in Spain, with over 21,600 megawatts (MW) of installed generating capacity. The company controls about half of the regulated electricity market and one-third of the liberalized market. The largest source of Endesa’s generating capacity is coal-fired plants, followed by nuclear. Spain's second-largest power utility overall is Iberdrola, though the company controls the largest share of the deregulated portion of the market. Other important players in Spain's electricity sector include Union Fenosa, Hidrocantabrico, and Gas Natural. Red Electricia de Espana (REE), owned by the Spanish government and numerous electricity companies, owns and operates Spain's electricity grid.

There are two electricity markets in Portugal, the Public Electricity System (PES) and the Independent Electricity System (IES). PES is the regulated market with power supplied at fixed rates under long-term contracts. The IES consists of smaller producers and consumers that allows unrestricted access by generators and distributors.

Formerly state-owned Electricidade de Portugal (EdP) maintains a dominant position in both markets. EdP controls almost all of the generating capacity in the PES and holds significant stakes in generating capacity in the IES. EdP's wholly-owned subsidiary, EdP Distribuicao, controls distribution in the PES. Electricity transmission in both markets is controlled by national grid operator Rede Electrica Nacional (REN), majority-owned by the Portuguese government.

Single Iberian Electricity Market (Mibel)

In January 2004, Spain and Portugal formally signed an agreement to create a pan-Iberian electricity market (Mibel). The new market will allow generators in the two countries to sell their electricity on both sides of the border. The country’s two energy market regulators, Spain’s OMEL and Portugal's OMIP, will merge to create a single operator for the integrated electricity market. Repeated delays have plagued the implementation of Mibel, though the official launch date is now slated for October 2007.

Despite administrative delays, there has been some progress towards integrations, namely, a new 40-kilovolt transmission line between the prospective countries at Cartelle-Lindosa. In January 2005, OMIP oversaw the cancellation of long-term power contracts between EdP and REN, which will open up access to the grid to third-party generators.

Spain's conventional thermal generating capacity contributes over half of the country's total power supply.

Over the past several years, this capacity has begun to shift from an emphasis on coal towards natural gas, specifically combined-cycle, gas-fired turbines (CCGFT). Spain has promoted CCGFTs in order to increase existing generating capacity and reduce its carbon dioxide emissions. Construction of CCGFTs has been one the principle drivers behind rising natural gas demand in Spain.

Portugal has also begun invested into CCGFTs, as a means to reduce dependence on hydropower that can fluctuate widely based on weather conditions.

Nuclear Power

Spain has eight operating nuclear plants, while Portugal has none. Spain decommissioned the Vandellos I reactor in July 1990, and Union Fenosa closed the Jose Cabrera plant in April 2006. Nevertheless, the output of the nuclear power sector in Spain has remained stable despite the closures, as upgrades and efficiency gains at existing plants have replaced retired capacity.

However, as the Spanish government has announced a moratorium on the construction of new nuclear power plants, it is likely that nuclear’s share of Spain’s electricity mix will decline in the long-term.

Other Renewables

Spain is the world's second-largest producer of wind power behind Germany, according to the Global Wind Energy Council. According to the Spanish Wind Energy Association, the country currently has over 11,000 megawatts (MW) of installed wind generating capacity. According to the Portugese government, that country has 1,700 MW of installed wind generating capacity, which includes 970 wind turbines spread across 140 separate wind farms.

In March 2007, Portugal inaugurated the Serpa solar power plant, one of the largest such facilities in the world. The plant has an installed capacity of 11 MW and covers 150 acres of land in the southern part of the country.

Coal

The last coal mine in Portugal closed in 1994, while production in Spain is in decline.

Coal is Spain's most plentiful indigenous energy source, with reserves of 584 million short tons (Mmst) in 2003. The country produced 22.7 Mmst in 2003, while consuming 45.6 Mmst, relying on imports for the balance.

Overall coal consumption has remained relatively flat over the past decade, with Spain's electricity sector constituting the largest share. Private companies produce most of the coal in Spain, though the single-largest company is Hunosa, owned by the government through the Sociedad Estatal de Participaciones Industriales (SEPI) holding company. Similar to other EU members, Spain’s coal industry has struggled to remain competitive vis-à-vis imported coal and other energy sources.

Portugal has not produced coal since its last mine closed in 1994. In 2003, Portugal consumed 5.9 Mmst of coal, mostly for electricity generation.