NEWS,17.02.2013

Horse-wary Britons spurn all meat

A poll out on Sunday found that almost a third of adults in Britain have stopped eating ready-meals as a result of the horsemeat scandal, while 7% have stopped eating meat altogether.The ComRes survey, for the Sunday Mirror and The Independent on Sunday newspapers, found that 31% have given up eating ready-meals as the discovery of equine flesh in products labelled beef spreads across Europe.The poll also found a 53% to 33% majority in favour of banning the import of all meat products "until we can be sure of their origin". Some 44% agreed that the British government had responded well to the crisis, while 30% disagreed. ComRes interviewed 2 002 adults online on Wednesday and Thursday. Twenty-nine beef products out of 2 501 tested in Britain have been found to contain more than 1% horsemeat, its Food Standards Agency (FSA) said on Friday.The scandal has left governments scrambling to figure out how and where the mislabelling happened in the sprawling chain of production spanning a maze of abattoirs and meat suppliers across Europe."We need to restore consumer confidence," said Britain's Deputy Prime Minister Nick Clegg."That is why we are working flat-out now with the European authorities, with other European countries and, of course, introducing things that we should now do on a more systematic debate like random testing."Opposition Labour leader Ed Miliband said the governing coalition had been too slow to grasp the situation."The government needed to do three things," he told Sky News television."Offer clear guidance, including to schools and hospitals, about what they should be doing;"Get the testing under way as quickly as possible and make sure the official testing is done, not as it is still planned to do by April, but much quicker;"And thirdly, get the police involved and make sure there is a proper police investigation."Mark Price,the chief executive of Waitrose, one of Britain's major supermarket chains, warned that in return for knowing that food is safe and genuine, it can no longer be seen as a "cheap commodity"."If the question is, 'who can sell the cheapest stuff?', I'm afraid it is inevitable that there will be a slackening of product specifications," he wrote in The Sunday Telegraph newspaper."If something good comes of the current scandal I hope it is the opening up of a debate around the true economics of food and a determination on the part of everybody in the food industry to apply renewed rigour to their processes and testing regimes to ensure that customers can relax and enjoy the food they buy," he said.Meanwhile FSA chief executive Catherine Brown conceded that the numbers of people who have unwittingly eaten horse will never be known.

G20 steps back from currency brink

The Group of 20 nations declared on Saturday there would be no currency war and deferred plans to set new debt-cutting targets, underlining broad concern about the fragile state of the world economy.Japan's expansive policies, which have driven down the yen, escaped direct criticism in a statement thrashed out in Moscow by policymakers from the G20, which spans developed and emerging markets and accounts for 90% of the world economy.Analysts said the yen, which has dropped 20% as a result of aggressive monetary and fiscal policies to reflate the Japanese economy, may now continue to fall. "The market will take the G20 statement as an approval for what it has been doing selling of the yen," said Neil Mellor, currency strategist at Bank of New York Mellon in London. "No censure of Japan means they will be off to the money printing presses."After late-night talks, finance ministers and central bankers agreed on wording closer than expected to a joint statement issued last Tuesday by the Group of Seven rich nations backing market-determined exchange rates. A draft communique on Friday had steered clear of the G7's call for economic policy not to be targeted at exchange rates. But the final version included a G20 commitment to refrain from competitive devaluations and stated monetary policy would be directed only at price stability and growth. "The mood quite clearly early on was that we needed desperately to avoid protectionist measures ... that mood permeated quite quickly," Canadian Finance Minister Jim Flaherty told reporters, adding that the wording of the G20 statement had been hardened up by the ministers.As a result, it reflected a substantial, but not complete, endorsement of Tuesday's proclamation by the G7 nations the United States, Japan, Britain, Canada, France, Germany and Italy.As with the G7 intervention, Tokyo said it gave it a green light to pursue its policies unchecked."I have explained that (Prime Minister Shinzo) Abe's administration is doing its utmost to escape from deflation and we have gained a certain understanding," Finance Minister Taro Aso told reporters."We're confident that if Japan revives its own economy that would certainly affect the world economy as well. We gained understanding on this point."Flaherty admitted it would be difficult to gauge if domestic policies were aimed at weakening currencies or not.The G20 also made a commitment to a credible medium-term fiscal strategy, but stopped short of setting specific goals as most delegations felt any economic recovery was too fragile.The communique said risks to the world economy had receded but growth remained too weak and unemployment too high."A sustained effort is required to continue building a stronger economic and monetary union in the euro area and to resolve uncertainties related to the fiscal situation in the United States and Japan, as well as to boost domestic sources of growth in surplus economies," it said.A debt-cutting pact struck in Toronto in 2010 will expire this year if leaders fail to agree to extend it at a G20 summit of leaders in St Petersburg in September.The United States says it is on track to meet its Toronto pledge but argues that the pace of future fiscal consolidation must not snuff out demand. Germany and others are pressing for another round of binding debt targets."We had a broad consensus in the G20 that we will stick to the commitment to fulfill the Toronto goals," German Finance Minister Wolfgang Schaeuble said. "We do not have any interest in US-bashing ... In St Petersburg follow-up-goals will be decided."The G20 put together a huge financial backstop to halt a market meltdown in 2009 but has failed to reach those heights since. At successive meetings, Germany has pressed the United States and others to do more to tackle their debts. Washington in turn has urged Berlin to do more to increase demand. Meanwhile, Russia, this year's chair of the G20, admitted the group had failed to reach agreement on medium-term budget deficit levels and expressed concern about ultra-loose policies that it and other emerging economies say could store up trouble for later.On currencies, the G20 text reiterated its commitment last November, "to move more rapidly toward mores market-determined exchange rate systems and exchange rate flexibility to reflect underlying fundamentals, and avoid persistent exchange rate misalignments".It said disorderly exchange rate movements and excess volatility in financial flows could harm economic and financial stability.

 

G20 vows to halt tax avoidance

The G20 group of the world's top economies expressed determination on Saturday to crack down on companies who duck their full taxation responsibilities with elaborate schemes.The call came after the finance ministers of Britain, France and Germany said it was time for coordinated action to halt the practice of shifting profits from a firm's home country to pay less tax under another jurisdiction.Cash-strapped governments are seeking to use every means to inject new funds into their budgets and have run out of patience with big firms shifting profits to be registered in tax havens like the British Virgin Islands and Bermuda."We are determined to develop measures to address base erosion and profit shifting" the G20 said in a communique after a two-day meeting of finance ministers and central bankers in Moscow.They vowed to "take the necessary collective action" and awaited an action plan which is set to be put forward later this year by the Organisation for Cooperation and Economic Development (OECD).Online retailer Amazon, internet giant Google as well as coffee shop chain Starbucks have been under the spotlight for their tax strategies in Britain and other EU countries in recent months.Starbucks came under particular pressure in Britain following the revelation last year that it has paid just £8.6m in British corporation tax since 1998, despite generating £3bn in revenues. It has now pledged to voluntarily pay back millions in extra tax."We are talking about something that is fundamentally legal. We need to modify the law," admitted the OECD secretary general Angel Gurria. "Avoiding double taxation has become a way of having double non-taxation."In a rare joint news conference, the finance ministers George Osborne of Britain, France's Pierre Moscovici and Germany's Wolfgang Schaeuble said while such tax avoidance was still technically legal, laws needed to be changed in a broad global effort.Schaeuble said it was "unfair that multinational companies should be able to use globalisation as a tool" not to pay their fair share of taxes while Moscovici described the issue as a "matter of fairness for our citizens".Osborne said that current global tax rules had been developed almost 100 years ago along principles set out by the League of Nations in the 1920s - and few changes had been made since."We want businesses to pay the taxes that we set in our countries. And this cannot be achieved by one country alone. No one country can create an international tax system by itself."The ministers emphasised that their proposal was supported by the Russian presidency of the G20.A person familiar with the OECD's report said it was essential to move rapidly, especially with the United States apparently not sharing Europe's wholehearted enthusiasm for the anti-tax avoidance drive."The timetable is going to be very tight - otherwise the (OECD) report will be buried," the person said.According to the OECD, some multinational companies use avoidance strategies that allow them to pay just 5% in corporate taxes while smaller businesses are paying 30%.It says that practices have become more aggressive in the past decade, with some multinationals creating offshore subsidiaries or shell companies and taking advantage of the tax breaks offered in the countries where these are registered.This has led to absurdities like the tax havens of Barbados, Bermuda and the British Virgin Islands in 2010 together receiving more foreign direct investment than either Germany or Japan, the OECD said.In 2010, the creation of offshores meant the British Virgin Islands was the second largest investor in China, it noted.

France jumps into horsemeat scandal

France on Sunday said there were solid reasons to believe that meat processing firm Spanghero had passed off horsemeat in meals labelled beef, but insisted that unwitting workers should not be penalised.The government said it was meeting with representatives of the 300-odd workers on Monday. The sanitary licence of the Spanghero plant was temporarily revoked last week."The government distinguishes responsibility for what seems to be the actions of Spanghero's leaders from the work of its employees," the agriculture ministry said in a statement.It added however that there was "serious, precise and corroborating evidence of consumer fraud at a European level."The government on Thursday presented the results of its initial investigation that said Spanghero had knowingly sold 750 tons of horsemeat mislabelled as beef over a period of six months.Of this, 500 tons were sent to French firm Comigel, which makes frozen meals at its Tavola subsidiary in Luxembourg.That meat was used to make 4.5 million products that were sold by Comigel to 28 different companies in 13 European countries, said the findings released by the DGCCRF anti-fraud office.Spanghero's licence to handle meat was suspended pending further investigations.Monday's meeting between the workers, Agriculture Minister Stephane Le Foll and Consumer Affairs Minister Benoit Hamon is aimed at determining how employees will be paid until the plant can re-open."We will tell the ministers to immediately restore the sanitary licence for our meals and sausages which do not contain beef at all," said Claude Hill from the CFDT trade union.

Meteor caused $33m in damage

As a small army of people worked to replace acres of windows shattered by the enormous explosion from a meteor, many joked on Saturday about what had happened in this troubled pocket of Russia.One of the most popular jests: Residents of the meteor were terrified to see Chelyabinsk approaching.The fireball that streaked into the sky over this tough industrial city at about sunrise on Friday was undeniably traumatic. Nearly 1 200 people were reported injured by the shock wave from the explosion, estimated to be as strong as 20 Hiroshima atomic bombs.But it also brought a sense of co-operation in a troubled region. Large numbers of volunteers came forward to help fix the damage caused by the explosion and many residents came together on the internet - first to find out what happened and soon to make jokes.Chelyabinsk, nicknamed Tankograd because it produced the famed Soviet T-34 tanks, can be as grim as its backbone heavy industries. Long winters where temperatures routinely hit minus-30 Celsius add to a general dour mien, as do worries about dangerous facilities in the surrounding region.In 1957, a waste tank at the Mayak nuclear weapons plant in the Chelyabinsk region exploded, contaminating 23 000 square kilometres and prompting authorities to evacuate 10000 nearby residents. It is now Russia's main nuclear waste disposal facility. A vast plant for disposing of chemical weapons lies 85km east of the city."The city is a place where people always seem bitter with each other," said music teacher Ilya Shibanov. But the meteor "was one of the rare times when people started to live together through one event.""For most people, it's a good excuse for a joke," he said.It also is why Shibanov quickly concocted a rap video that got wide internet attention, including the lines: ""Pow, pow, pow - everything flew and factory windows crumbled. This Friday the bars are going to be full, so be ready for the aftermath."But for many, it's provided a reason to roll up their sleeves and get to work repairing the more than 4 000 buildings in the city and region where windows were shattered, or to provide other services.More than 24 000 people, including volunteers, have mobilised in the region to cover windows, gather warm clothes and food, and make other relief efforts, the regional governor's office said. Crews from glass companies in adjacent regions were being flown in.Governor Mikhail Yurevich on Saturday said that damage from the high-altitude explosion - believed to have been as powerful as 20 Hiroshima bombs - is estimated at 1 billion rubles ($33 million). He promised to have all the broken windows replaced within a week.But that is a long wait in a frigid region. The midday temperature in Chelyabinsk was minus-12'C, and for many the immediate task was to put up plastic sheeting and boards on shattered residential windows.Meanwhile, the search continued for major fragments of the meteor.In the town of Chebarkul, 80km west of Chelyabinsk city, divers explored the bottom of an ice-crusted lake looking for meteor fragments believed to have fallen there, leaving a 6m-wide hole. Emergency Ministry spokesperson Irina Rossius told Russian news agencies the search hadn't found anything.Police kept a small crowd of curious onlookers from venturing out onto the icy lake, where a tent was set up for the divers.Many of them were still trying to process the memories of the strange day they'd lived through.Valery Fomichov said he had been out for a run when the meteor streaked across the sky shortly after sunrise."I glanced up and saw a glowing dot in the west. And it got bigger and bigger, like a soccer ball, until it became blindingly white and I turned away," he said.In a local church, clergyman Sexton Sergei sought to derive a larger lesson. "Perhaps God was giving a kind of sign, so that people don't simply think about their own trifles on earth, but rather look to the heavens once in a while."In Chelyabinsk, university student Ksenia Arslanova said she was pleased that people in the city of 1 million generally behaved well after the bewildering flash and explosions."People were kind of ironic about it. And that's a good thing, that people didn't run to the grocery store. Everyone was calm," the 19-year-old architecture student said. "I'm proud that our city didn't fall into depression."As Chelyabinsk began its healing process, residents of San Francisco, on the other side of the planet, worried that they might be next. A science institute in Northern California says it has received numerous reports of a bright streak of light over the San Francisco Bay area on Friday night.Cuba apparently experienced a phenomenon similar to the meteorite that detonated over Russia this week, island media reported, with startled residents describing a bright light in the sky and a loud explosion that shook windows and walls.