NEWS,22.05.2013

EU tackles tax evasion

Tax cheats big and small were under the microscope in Brussels on Wednesday, as European Union leaders gathered at a summit to discuss tax evasion amid a fresh scandal involving computing giant Apple.
"All of the questions of tax fraud and tax evasion will be taken up, meaning both those involving individuals and those involving companies," French President Francois Hollande pledged ahead of the talks with his 26 EU counterparts.
"I believe in low taxes for businesses because we've got to encourage investment, we've got to encourage jobs ... But we've got to make sure as we set those tax rates that companies pay taxes," British Prime Minister David Cameron added.
Their comments came a day after politicians in the United States publicly slammed Apple - one of the world's most successful technology companies - for using its international presence to dodge hefty US taxes. The arrangements are legal under loopholes in US law.
Among the allegations is that EU member state Ireland gave Apple a 2% income tax rate - far below its current, already-low corporate tax rate of 12.5%. But Irish Prime Minister Enda Kenny rejected those claims as he arrived for the Brussels summit.
"Ireland's corporate tax regime is very clear and transparent, and we do not do any special deals with individual companies in regard to that tax rate," he said.
The fight against tax evasion and avoidance has become a new global rallying cry, following a media expose on the widespread use of tax havens and scandals involving high-profile people in France and Germany.
The battle has gained traction in Europe amid concerns that painful austerity will be harder to sell if tax cheats are not forced to pay up. It is believed that EU governments lose €1 trillion ($1.3 trillion) annually in uncollected taxes.
The anti-poverty organization Oxfam estimates that more than €12 trillion are stashed away in tax havens within the EU and the territories it controls.
"Most governments claim to have no alternative but to cut public spending and development aid, but ... there's enough potential tax to be had on hidden 'private' money to end extreme world poverty twice over," said Natalia Alonso, head of Oxfam's EU office.
During their meeting in Brussels, the 27 leaders were set to call for progress on tackling "aggressive tax planning and profit shifting" by companies, according to a draft of their final statement seen by dpa.
European Parliament President Martin Schulz has proposed that all multinational companies should have to submit reports detailing what taxes they pay, profits they earn and how many people they employ in any given country.
"It is quite simply unfair that it should be the largest and most successful companies which pay virtually no taxes, even though they benefit enormously from state investment," Schulz told the leaders, according to a copy of his speech.
Various EU parliamentarians and non-governmental groups have called for the leaders to deliver hard-hitting measures, such as a blacklist of tax havens that would be subject to punishment.
But standing in the way of too much aggressiveness are Austria and Luxembourg, bank-secrecy stalwarts that are concerned about losing their attractiveness as banking destinations.
The draft summit statement does not propose any new measures, simply urging more action on VAT fraud, money-laundering and the taxation of the digital economy, along with more information-sharing between tax authorities including the adoption of EU reforms opposed by Austria and Luxembourg "before the end of the year."
Diplomats have argued that the Brussels summit, even without breakthroughs, will contribute to the "global momentum" against tax evasion and convey a united European position ahead of discussions at a Group of 8 summit in June.
German Chancellor Angela Merkel spoke of "a giant step forward."
"Just to be perfectly clear: we are not talking about harmonizing taxes or Europe taxing more or taxing less," EU President Herman Van Rompuy said. "We are talking about jointly fighting unacceptable practices that allow some people to avoid paying taxes altogether."
Also on Wednesday, the leaders were to discuss how energy policies can contribute to reinvigorating growth in the EU, with an unprecedented focus on energy prices. Bringing them in line with other parts of the world is seen as key to appeal to manufacturers.

Ireland feels heat from Apple tax row

Ireland called on Wednesday for an international clampdown on multinationals shifting profits around the world to avoid tax, after criticism that Irish loopholes helped technology giant Apple to shrink its tax bill.
A US Senate investigation into the tax affairs of the maker of iPhones, iPads and Mac computers has shone an uncomfortable spotlight on Ireland's tax regime and forced the government to defend itself against accusations of being Europe's onshore tax haven.
Other European governments, notably France, have previously criticised Ireland's low rate of corporation tax - 12.5% - but the revelations from Washington focus on loopholes in the Irish tax code that are more difficult to defend.
Richard Bruton, the minister in charge of attracting foreign companies to Ireland, admitted that companies need to be reined in.
"They play the tax codes one against the other; that is tax planning, and I think we do need international cooperation through the OECD to deal with the aggressive nature of that," he told state broadcaster RTE.
"Tax has always been an element of the Irish offering, and this will continue to be so, but what you have to avoid is what is known as harmful tax competition. We scrupulously avoid that."
Provoking Capitol Hill
The US investigation showed that Apple had paid just 2% tax on $74bn in overseas income, largely helped by Irish tax law, which allows companies to be incorporated in the country without being tax resident. Britain had a similar rule but changed it over 20 years ago to stop tax avoidance.
Unlike Britain, however, Ireland is heavily dependent on foreign companies such as Google, Pfizer and Intel for employment 150 000 of a labour force of around 2 million and for its much-vaunted economic model of export-led growth.
While Ireland has successfully repelled attacks on its corporate tax rate from European neighbours, US pressure is more difficult to ignore.
By closing its own loopholes, Washington could threaten Ireland's status as European hub for multinationals, and economists said it would be better for Ireland to act first.
"In the long run, the US Congress, if they wanted to, could wipe out those 150 000 real jobs, and we don't want to provoke people by over-egging it, by doing things that are clearly upsetting the US," said John FitzGerald, a professor at the Economic and Social Research Institute (ESRI), an Irish think-tank.
Ireland's Prime Minister Enda Kenny will face tough questions at a summit of European leaders in Brussels on Wednesday where the issue of tax avoidance will take centre-stage.
Bruton said scapegoating individual countries was not the answer and pointed to the fierce competition Ireland faces in trying to attract companies.
"When I go into the boardrooms either in Asia or the US, I am followed into those boardrooms by Swiss, by Singaporeans, by Dutch, by Belgians who are offering specially put-together deals on the tax front," he said.
"Ours is not a specially put-together deal; it is absolutely transparent, there are no side deals, no special arrangements."
"We make no apologies for having a regime that is designed to promote employment. It is a regime we have had for close to 50 years."

Japan trade deficit hits $8.6bn in April

Japan's trade deficit expanded a worse-than-expected 70% on year to $8.6bn in April, government data showed Wednesday, as a weaker yen made imports costlier.
The monthly trade deficit came to ¥879.9bn ($8.6bn), 69.7% higher than the year-before deficit of ¥518.4bn, finance ministry data showed.
The deficit was the biggest for the month of April in comparable official data that goes back to 1979 and was also worse than a shortfall of ¥620bn economists predicted on average in a poll by the Nikkei business daily.
Exports in April rose 3.8% to ¥5.78 trillion while imports jumped 9.4% to ¥6.66 trillion.
The yen's average rate was 96.01 to the dollar in April against 82.31 in April 2012, meaning the value of the Japanese currency fell by nearly 17% on year, the data showed.
A lower yen helps Japanese exporters but pushes up import bills.
Higher import costs have been resulting in higher materials and parts prices, which are leading to higher retail prices of various items ranging from foodstuff to laptops.
With the yen hitting multi-year lows against the dollar, some politicians have started voicing concerns over its negative impact on people's lives.
Japan's fuel imports have also stayed high as most of its nuclear reactors remain off-line since the huge earthquake and tsunami in 2011 sparked the world's worst atomic accident in a generation. 

Office bullying video sparks outcry in Singapore

A Singapore company supervisor caught on video slapping a male intern is in trouble after the clip went viral on the web and sparked a public outcry.

Police confirmed to AFP that a complaint had been lodged against the supervisor, who works at a software company, and the manpower ministry said it had also been alerted about the alleged case of workplace abuse.

The 17-second Singapore office bully clip, first uploaded on the video-sharing website YouTube last Friday, showed the boss repeatedly slapping a younger man described by local media as a 29-year-old intern.

A fellow intern who filmed the video said in a posting at an online forum that he had noticed the supervisor "constantly bullying" his co-worker soon after starting his internship.

When he confronted the boss, the supervisor explained that "there is a story behind" the abuse.

"He said that my colleague apparently has an inferiority complex and apparently my supervisor is trying to 'nurture' him to get over it," he said.

"I felt this was stupid, as how can you nurture someone by hitting them? My co-worker is very timid and seems like the kind of guy that will not stand up for himself."

The Straits Times reported on Wednesday that after the video went viral, two former interns in the same company also came out to say they had worked in fear under the supervisor.

Local Chinese-language newspaper Shin Min said the intern, a university graduate, was being paid $400 a month and that his parents may seek compensation from the firm.

NEWS,05 AND 06.04.2013

Obama to offer entitlement cuts in budget

President Barack Obama will make key concessions to Republican foes next week when he unveils his US budget that proposes cuts to cherished entitlement programs, the White House said on Friday.
Obama's fiscal blueprint slashes the deficit by $1.8 trillion over 10 years, in what a senior administration official described as a "compromise offer" that cuts federal spending, finds savings in Social Security, and raises tax revenue from the wealthy.
Republicans led by House Speaker John Boehner are widely opposed to any new tax hikes, after the president secured $600bn in increased tax revenue in a year-end deal.
But Obama's concession to conservatives in the form of reduced cost-of-living payouts for Social Security benefits could revive consideration of a deficit-reducing "grand bargain" that has proved elusive in recent years.
Such cuts to public pension programmes and public health insurance for the elderly - seen as sacred cows for Obama's Democrats  have been longstanding demands of Republicans.
"While this is not the president's ideal deficit reduction plan, and there are particular proposals in this plan like the CPI (consumer price index) change that were key Republican requests and not the president's preferred approach, this is a compromise proposal built on common ground," the administration official said.
The president is willing to "do tough things to reduce the deficit," but only in the context of a package that includes new revenues from the wealthy, the official added.
"This isn't about political horse trading; it's about reducing the deficit in a balanced way that economists say is best for the economy and job creation."
Obama's new revenues will draw in part from capping retirement savings plans for millionaires, and closing some loopholes that benefit the rich.
The annual budget deficit is projected at 5.5% of gross domestic product for the fiscal year ending in September. Under the Obama budget, that would decline to 1.7% of GDP by 2023.
Combined with the $2.5 trillion in savings already achieved since negotiations in 2010, the Obama budget would bring total deficit reduction to $4.3 trillion over 10 years, slightly higher than the overall goal agreed to by both parties for stabilizing the national debt.
Boehner offered a lukewarm reaction to the plan.
"One of the best things President Obama can do is follow the House and outline a balanced budget next week  one that includes entitlement reforms that are not conditional on enactment of more tax increases, which will suppress growth instead of encourage it," Boehner said in a statement.

Petrol price fixing probe ends - report

Prosecutors in Italy have wrapped up a probe triggered by suspicions that the country's steep petrol prices were the result of manipulation by several large oil firms, media reported Friday.
The results of the investigation into seven companies - ENI, Shell, Esso, Total ERG, Tamoil, Q8 and API - have been sent to legal authorities in Rome and Milan for possible further action.
Italian motorists pay the highest prices at the pump in the European Union, according to the European Commission's directorate general for energy.
The newspaper La Stampa said the Varese prosecutor's office in northern Italy, which conducted the probe at the urging of a consumer group, suspected the oil companies of "carrying out speculative moves to boost the price of fuel at the pump".
But the head of Italy's biggest oil company ENI, Paolo Scaroni, told reporters on Friday the probe was just the latest official scrutiny of what he described as unavoidably high petrol prices.
"There are several reasons fuel prices in Italy are higher than elsewhere in Europe. To name just one, there are 24 000 service stations in Italy compared with 9 000 in Britain with a total equivalent consumption, so these service stations, in Italy, need a bigger margin" to achieve profitability, he said.
He also cited reduced station opening hours, and noted that Italian service stations cannot sell other items, such as newspapers or cigarettes, to augment revenues.
"There is nothing underhanded," he said.
The average price for unleaded petrol in Italy at the end of 2012 was €1.75 per litre ($8.60 per gallon), according to the European Commission's directorate general for energy.
That compared with €1.50 per litre in France, €1.56 per litre in Germany, and €1.63 per litre in Britain, the data showed, according to the Commission's Eurostat statistics office.

Panicked Cypriots queue at banks

Panicked Cypriots queued outside banks on Friday on rumours that a new levy would be imposed on deposits as part of a bailout, but the authorities moved quickly to assure them this was not the case.
Cyprus wrapped up talks this week paving the way for the €10bn ($13bn) bailout from EU-led lenders, but fears swirled that it was still well short of the €5.8bn to fund its end of the deal.
As the speculation spread on Friday morning, customers formed long queues outside some of the larger branches of the Co-op bank, prompting the government to issue a denial of the reports as "unjustified" and "groundless".
"Such an issue was never tabled or discussed, therefore we categorically state that no such issue exists, not even as an intention," said the finance ministry.
"The memorandum has been agreed with the troika and it does not include any additional measure that leads to the need to implement any new haircut on deposits," it said, referring to the EU, European Central Bank and IMF.
The ministry said the measures agreed by the Eurogroup on March 25 for restructuring the Cypriot banking sector were being implemented and the system was "on track towards stabilisation and consolidation".
The central bank also denied reports of any plans to introduce a "general" haircut of deposits to pay for the conversion of uninsured deposits above €100 000 into shares in the island's biggest lender, the Bank of Cyprus (BoC).
"We refute this because such an action is not provided for in the policy decisions taken by the Eurogroup," it said in a statement.
The supervisory authority for the Co-op societies also warned anxious customers to ignore "slanderous rumours" being spread by text messages that a haircut on deposits was imminent.
Under the deal to downsize the banking sector, large BoC depositors could lose all of the remaining 60% of their balances over 100,000 euros depending on the costs of winding up and merging second-largest lender Laiki.
Savers in that bank will have to wait for years to see any of their cash over €100 000.
Banks have been operating under stringent capital controls since they reopened last week, after a near two-week lockdown prompted by fears of a run on deposits.

Global miners to hire more staff

Despite the unpredictability of the global mining industry, the prospect of hiring more staff is on the cards, according to a survey by Pedersen & Partners.

From the 160 companies surveyed across the sector, 33% indicated that they will be hiring more staff, while 50% said they will maintain their work force.

The results show that:

• 28% indicate they will be hiring new employees,
• 5% indicate they will be bringing back staff that were laid off,
• 50% will maintain their current staffing levels, and
• 15% suggest they will be restructuring.

The survey noted that the overall perception is that miners appear to be cautiously optimistic with most firms predicting that 2013 will be very similar to last year or improving somewhat.

However, it was not all good news, several small mining firms with market caps below $10m will not survive through the next year, the survey stated.

"Those with proven projects and strong management reputations may be subject to acquisitions or find more fluid funding through private equity, streaming, flow through shares and eventually, some institutional financing."

According to respondents 47% expect mergers and acquisitions to be a part of their growth strategy this year, while 31% said it will be considered for the right opportunity and 22% ruled it out altogether.

The last five years have been a turbulent time for mines with the global recession, operational restructurings, production cuts as well as expenditure reduction. This resulted in flagging confidence in the mining sector.

Mining in SA

The mining sector in South Africa, which is the backbone of the economy, has faced several challenges in recent months, including proposed job cuts, a series of wildcat strikes and the Marikana massacre in which more than 44 people died.

Data released by Statistics South Africa in March showed that total mining production was 3.1% lower in 2012 compared with 2011.

Finance Minister Pravin Gordhan stated in his National Budget speech in February that mine strife resulted in a revenue shortfall of R16.3bn, estimated to be 5.2% of the 2012/13 gross domestic product.

However, Mines Minister Susan Shabangu said in February that the country is committed to a strong mining industry, adding that the industry had grown from 993 mines in 2004 to almost 1 600 mines.

"We will continue to ensure that an enabling environment is created, while at the same time developing an environment that is responsive to the changing global economic environment and the dynamism of the contemporary mining industry," she said.

US trade deficit shrinks to $43bn

The US trade deficit edged lower in February after a big jump in January, government data released Friday showed.
The commerce department reported the trade gap shrank to $43bn, down from the revised $44.7bn in January.
The decline, which came after a large 16.7% deficit increase in January, surprised analysts who had projected a deficit of $44.7bn.
US exports grew 0.8 percent to $186bn, strengthened by the exports of industrial goods (up 4.5%) and automobiles (up 1.6%).
Meanwhile, US imports held steady at $228.9bn.
US imports of crude oil, which represent more than 10% of imported goods by the US, dropped 5.6% to $23.6bn.
But US imports of foreign automobiles rose 4.6% between January and February to reach $24.8bn.
On a 12-month basis, the US trade deficit has dropped by 3.5%.

Ireland slowly recovering

Ireland's central bank said on Friday the country's gradual economic recovery was broadly on track, barely changing its growth forecasts but warning the government it could not afford to ease back on its austerity programme.
It predicted gross domestic product would expand by 1.2%, a touch below the 1.3% foreseen three months ago, and kept its 2014 growth forecast at 2.5%.
Bailed out in late 2010, Ireland has been one of the few eurozone economies to grow over the past two years and closed in on weaning itself off emergency assistance last month by raising €5bn ($6.42bn) in a landmark 10-year bond sale.
The International Monetary Fund (IMF), one of Ireland's bailout lenders, struck a similar note on Wednesday when it said the economy would grow by 1.1% this year, the first time in six quarterly reviews it has not marked down its view for 2013.
However like the IMF, which cautioned that Ireland's gradual recovery remained highly uncertain, the central bank said its medium-term assessment for the export-focused economy relied on a pick-up in external demand from the second half of 2013.
"The gradual recovery of the Irish economy is continuing," the central bank said in its latest quarterly review.
"The prospects for such a recovery must be treated with some caution, however, given the high degree of uncertainty regarding the near-term outlook for world demand."
The bank said that while recent surveys, particularly in consumer sentiment, pointed to an easing in the rate of decline in the eurozone, the bloc was facing a delayed emergence from recession, and that would have knock-on effects for Ireland.
Export growth - driven completely by the booming services industry - would fall to 2.5% this year as a result, down on the 3% expected in January, while expansion in 2014 was marked down by just under the same amount to 5%.
That should be mostly offset by a lower than previously expected drop of 0.2% in consumer spending this year and slightly quicker rise of 0.4% in 2014. The fall in domestic demand may, finally, be nearing an end, the bank said.
With any growth in the domestic economy slight at best, unemployment is still forecast to fall only slightly, to 13.9% next year even though the estimated rate fell to 14% over the last two months.
The bank added that while unemployment rates for those with the lowest levels of education were around four times higher than those with third-level qualifications, in absolute terms the majority of the unemployed come from higher education.
It gave a cool reception to the government's promise to voters of a 20% reduction in the €5.1bn of austerity measures planned by 2015, following a deal struck with the European Central Bank to ease its the burden of its bank-assumed debt.
"Full implementation of the announced budget measures remains essential to preserve market confidence and to keep a buffer against negative shocks," the bank said.

Germans back Merkel's crisis management

A new poll shows Germans widely approve of Chancellor Angela Merkel's crisis management following a bailout deal for Cyprus, suggesting it remains a key asset for the leader as she prepares to seek a third term in elections in September.

The poll for ARD television published on Friday also showed Merkel's popularity riding high and that of centre-left challenger Peer Steinbrueck, who had a gaffe-strewn start to his campaign, sinking further.
But, although Merkel's conservative bloc is easily the biggest single party, it gave neither Merkel's current centre-right coalition nor the combination of Steinbrueck's Social Democrats and the Greens a parliamentary majority.
Merkel's hard-nosed handling of the debt crisis has long been popular at home, though many in the nations that have been bailed out resent the austerity and reform policies attached to the deals.
The poll of 1 002 people, conducted on Tuesday and Wednesday, found 65% agreed that Merkel has "acted correctly and decisively in the euro crisis”.
Only 33% thought that the German government thinks too little about the well-being of people in crisis-hit countries as it works to rescue the euro.
Fifty percent said it was right that investors and bank depositors in Cyprus had to contribute to the bailout for the small island nation.
Merkel's government was insistent that large depositors should help pay, but was criticised by Germany's opposition for initially accepting a short-lived plan that would have involved a levy on small deposits as well.
The survey found that 68% were satisfied with Merkel's work, unchanged from last month, and that Finance Minister Wolfgang Schaeuble was close behind, with 63%. But Steinbrueck's rating was down four points to 32%.
Still, the survey pointed to one risk for Merkel: It found that 75% of respondents believed the worst of the euro crisis is still to come.
Germany's economy so far has been relatively unscathed by the crisis, even as several countries suffer recessions.
A new group calling itself Alternative for Germany, which advocates scrapping the euro in its current form, plans to launch itself as a party on 14 April and run in the 22 September elections.
It's unclear whether it will be able to make any impact; another party, the Free Voters, has failed to make any inroads with a more moderate platform of opposition to the current bailout policies.
The ARD poll gave a margin of error of plus or minus up to 3.1 points.

North Korea advises diplomats to leave

Foreign diplomats in Pyongyang huddled on Saturday to discuss a North Korean evacuation advisory as concerns grew that the isolated state was preparing a missile launch at a time of soaring nuclear tensions.
The heads of all EU missions had agreed to meet to hammer out a common position after Pyongyang warned embassies it would be unable to guarantee their safety if a conflict broke out and that they should consider leaving.
Most of their governments made it clear they had no plans to withdraw any personnel, and some suggested the advisory was a ruse to fuel growing global anxiety over the current crisis on the Korean peninsula.
"We believe they have taken this step as part of their country's rhetoric that the US poses a threat to them," a British Foreign Office spokesperson said in London.
Missiles
The embassy warning coincided with reports that North Korea had loaded two intermediate-range missiles on mobile launchers and hidden them in underground facilities near its east coast.
"The North is apparently intent on firing the missiles without prior warning," the South's Yonhap news agency quoted a senior government official as saying.
They were reported to be Musudan missiles, which have never been tested, but are believed to have a range of around 3 000km, which could theoretically be pushed to 4 000km with a light payload.
That would cover any target in South Korea and Japan, and possibly even reach US military bases located on the Pacific island of Guam.
The White House said on Friday it "would not be surprised" by a missile test.
"We have seen them launch missiles in the past.... And it would fit their current pattern of bellicose, unhelpful and unconstructive rhetoric and actions," White House spokesperson Jay Carney said.
'Provocative act'
The Pentagon warned any such test would be "a provocative act", with spokesperson George Little urging Pyongyang to "follow international norms and abide by their commitments".
North Korea, incensed by UN sanctions and South Korea-US military drills, has issued a series of apocalyptic threats of nuclear war in recent weeks.
The North has no proven inter-continental ballistic missile capability that would enable it to strike more distant US targets, and many experts say it is unlikely it can even mount a nuclear warhead on a mid-range missile.
Nevertheless, the international community is becoming increasingly skittish that, with tensions showing no sign of de-escalating, there is a real risk of the situation spiralling out of control.
The latest expression of concern came from Communist icon Fidel Castro, who warned the danger of a nuclear conflict erupting was higher than it had been at any time since the 1962 Cuban missile crisis.
If war broke out on the Korean peninsula, "there would be a terrible slaughter of people", Castro wrote in a front-page article in Granma, the Cuban Communist Party's newspaper.
UN won't withdraw
The United Nations said it had no plans to pull staff out after the North Korean warning message to embassies and NGOs in Pyongyang.
Spokesperson Martin Nesirky said UN chief Ban Ki-moon was "studying the message," and added that UN staff "remain engaged in their humanitarian and developmental work" throughout North Korea.
According to the British Foreign office, embassies and organisations were told to inform the Pyongyang authorities by 10 April what assistance they would require should they wish to evacuate.
"Our understanding is that the North Koreans were asking whether embassies are intending to leave, rather than advising them to leave," the spokesperson said.
Russian Foreign Minister Sergei Lavrov said Moscow was consulting with China over the warning, as well as the United States and other members of the stalled six-party talks on North Korea.
In South Korea, a Navy official told Yonhap that two Aegis destroyers with advance radar systems had been deployed - one off the east coast and one off the west coast - to track any missile launch.
North Korea refused on Saturday to lift a ban on South Koreans accessing their companies in a joint industrial zone on the North side of the border.
Entry to the Seoul-funded Kaesong complex has been barred since Wednesday.

Castro urges calm in North Korean crisis

Communist icon Fidel Castro on Friday called on North Korea and the United States to avoid confrontation and reminded both sides of their "duties" towards peace.

"If a war breaks out there, there would be a terrible slaughter of people" in both North and South Korea "with no benefit for either of them”, Castro wrote in a front-page article in Granma, the Communist Party's newspaper.
Now that the North Korean government "has demonstrated its technical and scientific advances, we remind them of their duties with those countries that have been their great friends."
Castro urged North Korea to remember that "such a war would affect... more than 70% of the planet's population”, and decried "the gravity of such an incredible and absurd event" in such a densely populated region.
Castro said the present crisis presents the most serious risk of a nuclear war since the 1962 Cuban missile crisis, a two-week standoff between the United States and the Soviet Union over placing nuclear missiles in Cuba.
The "duty" to avoid the conflict is also in the hands of Washington "and of the people of the United States”, Castro said.
If a war breaks out, President Barack Obama's second term "would be buried in a deluge of images that would portray him as the most sinister personality in the history of the United States."
Castro, 86, handed over power to his brother Raul in 2006 but remains influential in Cuba and among leftists worldwide.
Meeting Kim Il-Sung
In his article, the Cuban leader recalled "the honour" of meeting Kim Il-Sung, the founder of the North Korean regime and grandfather to current leader Kim Jong-un.
The late North Korean leader, who died in 1994, was a "historic figure, notably brave and revolutionary," Castro wrote.
Castro also wrote that North Korea "has always been friendly with Cuba, as Cuba has been always and will continue to be" friendly with North Korea.
Castro writes an occasional column titled "Reflections of Comrade Fidel" that runs in state media. This is his first column since June 2012.
North Korea, incensed by UN sanctions and South Korea-US military drills, has issued a series of apocalyptic threats of nuclear war in recent weeks.
On Thursday the North Korean army said it had received final approval for military action, possibly involving nuclear weapons, against the threat posed by US B-52 and B-2 stealth bombers taking part in the joint drills.

NEWS,21.02.2013

Hope for foreign workers in US

The leading business advocacy group and the largest labor federation say they have a deal on principles for a new visa programme to bring lesser-skilled workers to the US a key component of any immigration overhaul bill. The groups, the Chamber of Commerce and the AFL-CIO, announced the breakthrough on Thursday after weeks of closed-doors negotiations at the request of senators involved in crafting an immigration deal in Congress.The principles include agreement to create a mechanism to let businesses more easily hire foreign workers when Americans aren't available to fill jobs. This will require a new kind of worker visa program that does not keep workers in permanent temporary status.But the joint statement from the chamber and AFL-CIO makes clear that more work needs to be done to turn their deal into a bill.

5 big US banks cut mortgage debt

Five of the biggest US banks have cut struggling homeowners' mortgage balances by $19bn, part of a total $45.8bn in relief provided under a landmark settlement over foreclosure abuses. More than 550 000 borrowers received some form of mortgage relief between March 1 and December 31 2012, according to a report issued on Thursday by Joseph Smith, the monitor of the settlement.That translates to about $82 668 per homeowner, according to the report, which is based on the banks' own accounts of their progress.The report says $19.5bn of the $45.8bn in relief was in the form of short sales, in which lenders agree to accept less than what the seller owes on the mortgage.

Horsemeat scandal spreads to Asia

The fallout from Europe's horsemeat scandal has spread far outside the continent, with an imported lasagne brand pulled from shelves in Hong Kong and a new row over the treatment of horses farmed in the Americas.A host of top players have been caught up in the spiralling scandal including Nestle, the world's biggest food company, top beef producer JBS of Brazil and British supermarket chain Tesco.Hong Kong authorities ordered ParknShop, one of the biggest supermarket chains in the city, to remove lasagne made by frozen food giant Findus, one of the firms at the centre of the scandal.The product was imported from Britain and made by French firm Comigel.Hong Kong's Centre for Food Safety said Wednesday that the item "might be adulterated with horsemeat which has not undergone tests for veterinary drugs".The chain, owned by tycoon Li Ka-shing, has about 280 stores in Hong Kong and the neighbouring gaming hub of Macau.In Europe, the Czech Republic became the latest country embroiled in the horsemeat affair, with food inspectors ordering Tesco to withdraw Nowaco brand frozen "beef" lasagne after detecting horsemeat.The Czech Agriculture and Food Inspection Authority said it had found horse DNA in two samples of the Nowaco meals manufactured by the Tavola company in Luxembourg.Croatian company Ledo, which imported beef lasagne containing horsemeat into Slovenia, on Wednesday also accused Tavola of being responsible.Supermarkets in Belgium, Britain, Denmark, Ireland, Finland, France, Austria, Norway, The Netherlands, Germany, Italy, Spain, Portugal, Sweden and Slovenia have all removed meals from shelves.The Czech authority noted that horsemeat is sold for human consumption in the country, but that if not mentioned on the product label it was misleading to consumers and could lead to a fine of up to three million koruna (€118 000, $159 000).Spanghero, the French firm that sparked the food alert by allegedly passing off 750 tonnes of horsemeat as beef, was on Monday allowed to resume production of minced meat, sausages and ready-to-eat meals.But the company, whose horsemeat found its way into 4.5 million "beef" products sold across Europe, will no longer be allowed to stock frozen meat.The firm's sanitary licence was suspended last Thursday after it was accused of passing off huge quantities of mislabelled meat over a period of six months.Investigators on Wednesday conducted a second day of raids on Spanghero's headquarters in Castelnaudary in southern France, a source close to the probe said, adding they had already seized several documents and copied computer records.About 60 workers from French company Fraisnor, which produces fresh lasagne, demonstrated on Wednesday in the northern town of Feuchy for state financial aid, saying their sales had dived 70% after the scandal.The company, which manufactures about 700 tonnes of fresh lasagne a month, is on the point of laying off some of its employees.Most Swiss supermarkets on Wednesday withdrew horsemeat products from their shelves, not due to the spiralling fake labelling scandal but over allegations of cruel conditions on farms where horses are bred for meat.German discount chain Lidl said it had removed all horsemeat products from its shelves in Switzerland, while the country's second largest supermarket chain, Coop, said it had withdrawn around 20 horsemeat sausage products.The move came amid outcry over an investigative consumer show that aired on Tuesday evening on Swiss public television, featuring images taken by animal protection activists showing starving and visibly sick and suffering horses on farms in a number of countries that provide meat to Swiss stores.The Zurich-based Animal Protection Association had sent investigators to large horsemeat producing countries Canada, the United States, Mexico and Argentina to probe how the animals were kept, transported and slaughtered."Our investigators found that the horses were bred in conditions that did not meet any of the norms in place in Switzerland and the European Union," project leader Sabrina Gurtner said.Coop however said it would continue to sell fresh horsemeat, pointing out that it receives 70% of that meat from France and the remaining 30% from Poland.Switzerland's largest supermarket chain, Migros, meanwhile said it would not withdraw any horsemeat products, saying it trusted its Canadian supplier.Dried horsemeat products are widely consumed in Switzerland.Elsewhere Bolivia's President Evo Morales slammed western fast food as "a threat to humanity" as he accused multinational firms of seeking to block the development of his country's staple food quinoa.The left-wing Bolivian leader slammed capitalist "fast food" for causing cancer and other diseases, in a speech to the UN General Assembly to launch the commemorative year.Morales steered clear of the growing horsemeat scandal which European officials have been keen to stress is a labelling issue not a public health issue.

North Korea top task for new South head

Park Geun-Hye will be sworn in as South Korea's first female president next week - a historic landmark clouded by North Korea's recent nuclear test and threats emanating from Pyongyang. The daughter of the late dictator and vehement anti-communist Park Chung-Hee, Park campaigned on a policy of cautious engagement with Pyongyang in contrast to her hawkish predecessor, Lee Myung-Bak.But her plans are likely to be shelved, at least for the short term, after the 12 February nuclear test angered the public in the South and emboldened hawks in Park's ruling conservative party.The UN Security Council is still debating how to respond, but is almost certain to toughen sanctions on Pyongyang - a move that could trigger a sharp response from the North and possibly even another nuclear test.Kim Jang-Soo, a former defence minister who has been appointed Park's national security adviser, signalled on the same day as the test that the new administration's policy could "not be the same as before".Park strongly condemned the test and warned the regime of North Korean leader Kim Jong-Un that it would bring about its own collapse with its complete isolation from the international community.Park's first challenge will be hardliners in her own party who are staunchly opposed to engaging Pyongyang and some of whom have even begun calling in public for South Korea to build its own nuclear deterrent."We urgently need to solve the unbalanced nuclear capability between the two Koreas and may need nuclear arms ourselves for minimum self-defence," said Won Yoo-Chul, a senior member of Park's New Frontier Party.A survey by Gallup Korea published on Wednesday showed more than 60% of South Koreans support the idea of Seoul having its own nuclear weapons capability.At the same time, Park's efforts to mollify her party hawks are being undermined by the increasingly bellicose statements coming from the North.On Tuesday, the North Korean envoy at the UN Conference on Disarmament in Geneva warned that South Korea faced "final destruction" if Seoul and its allies pushed for tougher UN resolutions over the North's nuclear programme.Kim Yong-Hyun, a professor of North Korea studies at Dongguk University, said Park's hands would be tied after she took office."The UN Security Council will surely impose more sanctions that will be supported by Seoul," Kim said. "In that climate, I see little possibility for substantial cross-border talks for six months at least."Park had promised a package of substantial welfare programmes aimed at the South's rapidly growing elderly population, but the North's test has already resulted in a shift in spending priorities."We are now faced with an unexpected need to increase the defence budget," Park said on Monday.The North has traditionally sought to test the mettle of the South's new leaders as they take office, sometimes with a view to forcing Seoul -and the US - into negotiations.Despite the difficult environment, Moon Chung-In, a politics professor at Yonsei University, said Park needed to move swiftly and "proactively" to position South Korea as the chief international mediator with the North."That way Park will enjoy more diplomatic leverage with China and the US than before... so she needs to take a more open and proactive stance," Moon said.Inter-Korean contacts have been effectively frozen since Seoul accused Pyongyang of torpedoing one of its warships in March 2010, and halted almost all trade and aid to the impoverished North.The North denied involvement, but went on to shell an island on the South Korean side of their disputed maritime border in November 2010, leaving four South Koreans dead and sparking brief fears of a full-scale conflict.Paik Hak-Soon, a North Korean analyst at the Sejong Institute think tank, said the hard-line stance of Park's predecessor, president Lee, had failed to produce any results and should be discarded."If Park takes a confrontational stance, she will end up repeating the same mistake as Lee, who not only failed to curb the North's nuclear ambitions, but also saw inter-Korea relations worsen," Paik said."She needs to act as soon as possible to restart a dialogue, though it won't be politically easy," he said.

Mexico vigilantes kill criminal - claim

Armed vigilantes in southern Mexico engaged in a shootout on Wednesday with a group of men they described as criminals, killing one in what appeared to be the first death related to the month-and-a-half-old "self-defence" movement.The confrontation near the town of Ayutla raised the stakes in a growing movement that has seen residents of several towns arm themselves with a motley assortment of old hunting rifles, shotguns and pistols while conducting patrols and manning checkpoints to fight crime spawned by drug cartels.Bruno Placido, leader of the vigilante movement in the southern state of Guerrero, said one of the civilian patrols caught sight of a group of armed men, who opened fire on the patrol"There was one killed on the side of the criminals," he said.The masked vigilantes frequently stop passing motorists to search for weapons or people whose names are on hand-written lists of "suspects" wanted for crimes like theft and extortion.The vigilantes have opened fire before on motorists who refused to stop, slightly wounding a pair of tourists from Mexico City visiting a local beach in early February. The shootout on Wednesday came one day after the vigilantes freed the last of 42 people detained on suspicion of crimes ranging from theft to extortion and murder, a move that authorities had hoped spelled the beginning of a new, more regulated phase for the "self-defence" groups.The Guerrero state government said the vigilantes turned 20 of the final detainees over to police. It said the other 22 had been suspected of lesser offenses and were released on Tuesday because the vigilantes considered they had been sufficiently punished."The state government foresees that the release of these detainees closes a chapter, and sets things on the road to institutionalising and regulating community police forces," the state government said in a statement.Placido, the vigilantes' leader, confirmed that some prisoners had been turned over.State officials hope the vigilantes can be persuaded to join already-established "community police" forces that operate in some Guerrero towns, where unmasked residents with some training and minimal uniforms, usually printed T-shirts, perform routine patrols and turn over suspects to town assemblies. Following local custom, those assemblies try the suspects and can impose some sentences.The recently formed "self-defence" groups, however, have none of those trappings. They consist of men wearing ski masks and bandanas over their faces while manning the improvised highway checkpoints and patrolling rural areas.Residents tired of rampant crime set up the roadblocks in early January and detained about 53 people. They held the detainees at improvised jails in villages around Ayutla, in some cases for more than 1 month. They released the first 11 detainees in early February.While local media have reported that self-defence groups have spread to 36 communities in eight states, that may exaggerate their numbers. For example, assistants to the mayors of two towns in the State of Mexico, next to Mexico City, where self-defence groups had reportedly formed, denied that any vigilante committees existed in their towns.But "self-defence" represents an attractive option for some rural towns in Guerrero and neighbouring states like Michoacan and Morelos. Because official forces are woefully inadequate and often corrupt, vigilante groups can press to have their members hired by local governments as backup security forcesEven in some of the rougher neighbourhoods on Mexico City's eastern outskirts, improvised block committees have formed to fight crimes like burglaries and muggings."No More Robberies! If We Catch You, We Will Lynch You!" reads one banner that a local block committee hung across the street in the town of Texcoco, east of the capital. A local resident who works at a car wash said residents organized the block committee, called "Vigilant Neighbour Committee", about two years ago in the face of frequent home robberies.Residents ring local church bells to alert each other if they see a crime in progress. The man said they had caught thieves but hadn't lynched any. "The police usually come to pick them up before anything can happen," said the car-wash employee, who did not give his name for fear of reprisals."Before, they would just come into your house to steal, and you would say, 'Sure, take whatever you want,'" said the man. "But nowadays, they beat your family, they start attacking your family."Eduardo Gallo, a prominent anti-crime activist, said the armed community groups pose the danger of becoming vengeful mobs, "but that is what the citizenry is being forced into when they don't have any public safety".Gallo said the "self-defence" groups are likely to hang on, and perhaps grow, if authorities don't guarantee public safety in the wave of drug cartel violence and common crime.Police reform has a long way to go in Mexico, with only about half of the country's police officers vetted and subjected to background checks."I think we are going to see the self-defence phenomenon grow a bit more, and even see them turn into revenge groups, until this hits bottom and the government begins to change its attitude," Gallo said.

NEWS,24.01.2013

Britain reaches out to world leaders

British Prime Minister David Cameron insisted on Thursday he was not turning his back on Europe as he came face to face with world leaders for the first time since unveiling plans for a referendum.In a speech to the World Economic Forum in Davos, Cameron said he would use his country's chairmanship of the G8 to counter tax avoidance by corporations and urged action to curb the threat of terror attacks. But the global elite gathered in the snowy Swiss ski resort only had ears for Cameron's comments on the European Union, a day after he unveiled his proposal to let the British public vote on whether to stay in the bloc.He held talks with German Chancellor and EU powerbroker Angela Merkel and the prime ministers of Ireland, Italy and the Netherlands on the sidelines of the annual forum to seek support for his plans."This is not about turning our backs on Europe quite the opposite," Cameron told the audience of business leaders, top politicians and journalists from around the world."It's about how we make the case for a more competitive, open and flexible Europe, and secure the UK's place within it."His announcement on Wednesday that he wants to renegotiate Britain's relationship with Brussels and then hold an "in-or-out" referendum on membership by the end of 2017 has delighted his increasingly anti-EU party at home.European leaders in Davos called on Britain to stay in the 27-nation group and made encouraging noises, in public at least, in support of Cameron's calls for reforms to make the EU more competitive.Cameron will need allies in Europe to back his quest to renegotiate Britain's relationship with Brussels before holding a referendum on the new terms.Dutch premier Mark Rutte warned that without the EU, Britain would be "an island somewhere in the middle of the Atlantic Ocean, somewhere between the United States and Europe".Irish Prime Minister Enda Kenny said the EU would be "stronger if Britain is part of it."Merkel meanwhile sidestepped the topic but reached out to Cameron by vowing more action on one of the key reforms he wants for Europe boosting competitiveness."I say this expressly to my colleague David Cameron. You too have addressed competitiveness, see this as a central issue to ensure Europe's prosperity for the future," she said.Foreign policy guru and former US secretary of state Henry Kissinger told the forum that the "idea of European unity needs to be resolved" if the continent is to make a lasting recovery from the three-year eurozone debt crisis.But Cameron rejected any idea of a European superstate or of Britain ever adopting the euro and added that he did not agree that "there should be a country called Europe".Britain's Finance Minister George Osborne backed up the message when he appeared at Davos later, saying: "I'm arguing for reform in Europe and Britain being part of a reformed Europe."Cameron said in his speech that Britain's presidency of the Group of Eight leading world economies Britain, Canada, France, Germany, Italy, Japan, Russia and the United States would focus on tackling tax avoidance and increasing transparency in a bid to boost the global economy.He said corporations must "pay their fair share" of taxes and that too many businesses were abusing tax schemes, after Britain last year announced a crackdown on multinationals such as Starbucks, Google and Amazon.UN Secretary General Ban Ki-moon, Microsoft tycoon Bill Gates and Jordan's Queen Rania are due to share the stage with Cameron on Thursday evening to speak on issues affecting the global economy.The crisis in Mali, where French forces are helping African troops fight Islamist militants, was also being discussed.No formal decisions are taken at Davos but corporate deals are often sewn up on the sidelines and presidents and prime ministers huddle to thrash out pressing issues.

Concern over currency manipulation at WEF

German Chancellor Angela Merkel expressed concern on Thursday about the risks of currency manipulation, specifically mentioning Japan, where the central bank has decided to quicken the pace of money-printing."I am not completely without worry. We have a much higher sensitivity through the discussion in the G20 for currency manipulation or political influence," Merkel said at the World Economic Forum in Davos."I don't want to say that I look towards Japan completely without concern at the moment. And it will be important for Europe as well that the ample liquidity that was given out to banks last year is collected back again."

EU carbon market plunge 'a wake-up call'

A carbon market price fall to less than €3 on Thursday must serve as a wake-up call to EU member states to back a Commission plan to prop up the European Union's Emissions Trading Scheme (ETS), the EU climate commissioner said.The cost of carbon allowances on the ETS hit a low of €2.81 a tonne on Thursday after a European Parliament committee in a preliminary, non-binding vote, rejected proposals for market reform. The price later climbed back above €4."It must be clear to all that when the Commission warned that the ETS price could drop dramatically it was not a false warning but a real possibility," Climate Commissioner Connie Hedegaard said in a statement."This should be the final wake-up call both to governments and to the European Parliament."Thursday's vote was only an advisory step in the tortuous EU process of trying to agree a plan to remove temporarily some of the surplus allowances that have depressed the market.A more decisive vote in the European Parliament's environment committee is expected next month, to be followed by a vote of member states.Hedegaard said there was widespread agreement an ETS was "the most cost-efficient tool in EU climate politics" and world-wide the idea was catching on.The European Union is working on linking up with other schemes in Switzerland and Australia, for instance.As the rest of the world moves towards coherent carbon pricing, which many in business say they need to plan investment, Hedegaard said the EU was in danger of a messy patchwork of policies, different for each of the 27 member states."The alternative to a well-functioning carbon market is hardly that the EU member states will make it cost nothing to pollute," she said."The alternative is a re-nationalisation of climate tools, meaning a future patchwork of up to 27 different systems and taxes, instead of one market creating a level playing field internally in Europe."