NEWS,07. AND 08.06.2013

Denmark's CEOs bank the most

Denmark's CEOs are leading the field in receiving the highest gross pay levels for those in middle order jobs, although the countries with the highest basic CEO salaries are in the two struggling economies of Italy and Spain.

There are also some signs that companies are converting bonus payments into base salary for senior staff.

The 12th edition of Europe’s most comprehensive review of remuneration levels has just been published by the Federation of European Employers (FedEE).

Pay in Europe 2013 provides median pay figures for 32 job positions in 47 countries and territories ranging from the micro states of Andorra and Liechtenstein to the continents biggest and most populous economies such as Germany and Russia.

The figures are expressed as gross hourly rates and exclude bonus, commission, 13/14th month payments and benefits.

Generally, the differential between Europe’s poorer and higher paying countries is narrowing, although for some countries such as Moldova - where gross hourly pay levels are just 4% of those in Denmark - improvement remains slow.

In fact, nine countries remain with median wages and salaries less than 10% of those in Denmark - Moldova (4%), Belarus (5%), Albania (5%), Ukraine (6%), Bulgaria (7%), Macedonia (7%), Serbia (7%), Romania (9%) and Russia (9%).

Speaking at the launch of this year’s report Robin Chater, secretary-general of FedEE, pointed out that “the pay gap between Denmark the other higher paying states of Liechtenstein, Norway and Switzerland is now closing fast".

In many eastern and southern European states the increased attention of tax authorities is bringing many hitherto unrecorded payments into the formal payroll.

"Although gross salary levels in eastern Europe are rising, the continuation of inflation rates well above the European average mean for many people in countries such as Romania and Turkey real pay levels are failing to improve,” Chater said.

EU, IMF at odds over Greek bailout

The European Commission clashed with the International Monetary Fund on Thursday over their handling of the first Greek bailout, which the IMF said had pushed an extra burden on Eurozone taxpayers by letting Athens delay restructuring its debts.
The Commission, together with the IMF and the European Central Bank, forms the so-called Troika that prepared financial assistance programmes for Greece, Ireland, Portugal, Spain and Cyprus in the three years since the euro zone sovereign debt crisis started.
The IMF said some aspects of the first aid package to Athens might have been handled better, starting with a restructuring of Greek privately held debt already in 2010.
"I think we would all agree that some things could have been done differently," IMF spokesperson Gerry Rice told reporters in Washington. "And I think we would all agree that with our European partners we have learned, and we have adapted."
The European Commission said the first, €110bn rescue for Greece had been put together in extremely difficult circumstances and stressed it had a very different view from the IMF on the feasibility of an early Greek debt restructuring.
"The (IMF) report argues that an upfront debt restructuring in 2010 would have been desirable. We fundamentally disagree," Commission spokesman Simon O'Connor told a news briefing.
Greece restructured privately held Greek bonds only in 2012, imposing losses of more than 70 percent on investors after the country's recession turned out to be longer and deeper than anticipated and reforms were delayed.
"An upfront debt restructuring would have been better for Greece although this was not acceptable to the euro partners," the IMF report said late on Wednesday.
It said the delay only allowed private investors to sell their Greek bonds and shifted the burden to euro zone governments and their taxpayers, who now, being the main creditors of Greece, might have to offer it further debt relief if the country meets agreed fiscal targets.
IMF mistake
The IMF said it, too, made mistakes; it lowered its normal standards for debt sustainability to take part in the bailout and made overly optimistic forecasts for the Greek economy.
The euro zone had asked the IMF to take part in its emergency lending programmes to boost their credibility with markets, undermined by the lack of respect for the European Union's own budget rules among EU governments.
After three years of close cooperation with the single currency bloc on five aid packages, the IMF said their operations would benefit from some changes.
"Options for dividing up work on areas that are not macro-critical should ... be explored," the IMF said in the section of its report entitled "Possible lessons".
"There may also be some scope for streamlining procedures and documents to reduce the burden on the authorities," it said.
European Central Bank President Mario Draghi told a news conference the IMF's remarks should be considered.
"If the IMF decides to do a mea culpa, identifies mistakes that have been made, we have to take this into account in the future," he said, but appeared to distance himself from the IMF's view that debt restructuring should have happened earlier.
"Often ... you judge what happened yesterday with today's eyes. It's always very hard to make ex-post judgments," he said.
Last month ECB Executive board member Joerg Asmussen told the European Parliament that the arrangement with the Troika should eventually be replaced by the euro zone bailout fund and the European Commission. But this was for the future, he said.
"I would not advise to change the Troika system now in the middle of the crisis," he said. "We have no alternative to it right now."
Some Eurozone policymakers, including authorities in Berlin, are unhappy with the fact that the Troika is composed of officials who are not democratically accountable for the tough reforms they prescribe to governments.
"It is clear that the Troika needs to be rethought," said Sharon Bowles, who heads the European Parliament's economic committee. "It is not possible that decisions which strike at the very heart of a country continue to be taken without the proper level of accountability," she said.
Asked about the prospects for future cooperation with the IMF within the Troika, the Commission spokesman said the two organisations had been effective despite their differences in extremely complex circumstances.
"We have different traditions, different approaches to many issues. We have always managed to come to sound and constructive solutions and a way forward. I would not jump to any conclusions if there should be any changes to the way we work together on the basis of this report," O'Connor said.

Inquiry may curb China's thirst for wine

China's rapidly growing urban middle class has fuelled a boom in wine sales over the past decade and offered a lifeline to ailing European vineyards, especially in France.
That lifeline could be jeopardised if Beijing decided to impose tariffs on EU wines, analysts said on Thursday.
"The EU countries were the first to introduce and import wines to China," said Deng Yutian, general manager of importer and distributor Blue Beacon Fine Wines.
"The French government and district trading associations made collective efforts to promote their products, leaving Chinese consumers with a strong first impression," Deng said, adding that other EU wine-producing nations were slower to enter the Chinese market.
"Countries like Italy produce wines that are equal in quality to the French wines, but their sales fall far behind," he said.
France is Europe's biggest supplier of wine to China with exports last year reaching a value of €546m the European Commission's data shows.

Spain and Italy are also among the top exporters.

But China said earlier that it would carry out an anti-subsidy and anti-dumping investigation into EU wine, a day after the commission imposed duties on imports of Chinese solar panels after finding evidence of below-cost selling by Chinese producers.
The Chinese investigation was a cause of "legitimate concern" to French producers, who count on new markets like China's to keep 500 000 people employed, the French Federation of Wines and Spirits Exporters said.
Subsidised
Overall, EU producers shipped 257 million litres of wine to mainland China last year, the EU statistics agency, Eurostat, said.

China was the third-largest consumer of EU wine outside the bloc, behind only the United States and Russia.

Chinese data showed 68% of wine imports came from the European Union.
If China imposes additional duties on EU wines, pushing up their prices, 'new world' wines would gain market share, Deng said.
"The current tariff is around 47%", he said.
If the Chinese investigation concludes that EU wines had been illegally dumped or subsidised, the tariff could increase to about 70%, making EU wines "really too expensive," Deng said.
China is already the world's largest wine market and remains the fastest growing market, according to London-based International Wine and Spirit Research.
Consumption in China rose by 142% from 2007 and 2011 and was forecast to rise by another 40% by 2016, the research group said in a report for the Vinexpo wine trade fair.
Online sales in China accounted for 27% of total wine sales in 2011 and were expected to jump to 47% in 2016 with sales at supermarkets also soaring, the Vinexpo report said.
Avoiding the cheaper wines offered by shops and online retailers, some wealthy Chinese wine drinkers and dealers travel to Hong Kong or Europe to buy high-end vintages.

Thai rice losses lower than reported

Losses incurred by the Thai state budget from its rice intervention scheme are lower than the 260 billion baht ($8.5bn) mentioned by some media but it is too soon to come up with a precise figure, Deputy Commerce Minister Nattawut Saikuar said on Friday.
The government has been buying rice from farmers at a price higher than the market since October 2011. It has given very little information on how much it has bought or how much it has managed to sell, and at what price.
Media have reported various figures for the losses.
One report that the losses had reached 200bn baht ($6.5 in) in the 2011/12 crop year drew a warning about the cost to the budget from Moody's rating agency this week, adding fuel to a political debate and forcing Prime Minister Yingluck Shinawatra to promise more transparency.
Nattawut was speaking at a briefing as part of that initiative. 
($1 = 30.60 Thai baht)

Europe divided on shale gas

European countries are divided on the extraction of shale gas.
This new source has sparked an energy boom in the United States, but its method of extraction, fracking, is controversial because of the risks it poses to the environment.
Exploratory drilling has been allowed and started in some European countries like Poland, but extraction has not yet begun.
The exact quantity of shale gas reserves and their quality have not been established yet.
Nod for exploratory drilling
Poland, Britain, Romania, Hungary and Spain are the strongest advocates of shale gas energy in Europe. They all delivered permits for exploratory drilling. Poland is far ahead with 44 exploratory wells though ExxonMobil pulled out because of disappointing results.
Last December, Britain decided that exploratory fracking can resume.
In Romania, US oil giant Chevron obtained permits to explore on Romanian Black Sea Coast and hopes to do so in the Eastern region of Barlad.
Lithuania recently passed a law allowing Chevron to proceed with exploration and extraction.
While Sweden and Denmark have delivered permits for exploration, shale gas is not a priority in their energy mix.
Countries that said no
France was the first country to ban fracking in 2011 because of the risks for the environment, as did Bulgaria and the Spanish region of Cantabria.
Italy has also said that it has no intention to launch shale gas extraction.
Countries in the middle
Germany has so far refused to allow exploratory drilling, and a move to allow prospecting under tight controls was postponed until after elections later this year.
The Netherlands has issued permits but they are suspended awaiting the results of a government investigation on the potential risks of fracking.
Belgium is conducting scientific studies before issuing any permits.
The Czech Republic is preparing a moratorium freezing for any prospecting for two years.
Austria has no exploratory drilling under way, and permits can be issued only after an environment impact study.
Slovakia, Finland and Latvia have shown no interest in shale gas extraction. In Portugal, exploratory drilling has been abandoned because of a lack of commercial interest.

US, Venezuela meet to mend ties

US and Venezuelan officials will meet soon for talks that could lead to the countries exchanging ambassadors for the first time since 2010, Venezuela's foreign minister said late on Thursday.

The meeting will be "in the next days, probably in Washington", said Foreign Minister Elias Jaua, speaking on the sidelines of the Organisation of American States general assembly meeting here.
Washington and Caracas have had a stormy relationship for years, even as Venezuela exports 900 000 barrels of oil per day to the United States.
Caracas and Washington have been operating embassies in each other's country without an ambassador since a diplomatic spat in 2010.
In one sign of the difficult ties, President Barack Obama has yet to acknowledge the victory of Venezuelan leader Nicolas Maduro - the hand-picked successor of the late leftist icon Hugo Chavez - in the 14 April presidential election.
Maduro won the controversial vote by a razor-thin margin in an election that his rival, centrist Henrique Capriles, has refused to concede.
Jaua did not give a date for the meeting, but told reporters that Venezuela will be represented by its charge d'affairs in Washington, Calixto Ortega.
"I believe there is good will on both sides," Jaua said about the upcoming meeting.
Jaua also downplayed Obama's failure to recognise Maduro's victory. It is "not an issue that matters”, he said.
During his lengthy presidency Chavez regularly criticised US "imperialism" and courted US foes like Iran and Syria.
Jaua, however, said it was the late leader who told Venezuelan officials "that we had to work towards normalising these relations" with Washington.
On Wednesday Jaua met with US Secretary of State John Kerry in Antigua in a first step to mend ties.
Kerry described the meeting as "very, very positive”.
Both diplomats agreed that "we would like our countries to find a new way forward, establish a more positive relationship”, Kerry said.
The Kerry-Jaua meeting came on the same day that Venezuela expelled Timothy Tracy, a US filmmaker who said he was filming a documentary, but who authorities labelled a spy - a charge the United States denied.

Russia ready to replace Austria in Syria

Russia is ready to replace peacekeepers from Austria in the Golan Heights, President Vladimir Putin said on Friday, after Vienna said it would recall its troops from a UN monitoring force due to worsening fighting in Syria.

Austria, whose peacekeepers account for about 380 of the 1 000-strong UN force observing a four-decade-old ceasefire between Syria and Israel, said it would pull out after intense clashes between Syrian government forces and rebels on the border.
"Given the complicated situation in the Golan Heights, we could replace the leaving Austrian contingent in this region on the border between Israeli troops and the Syrian army," Putin said at a televised meeting with Russian military officers.
"But this will happen, of course, only if the regional powers show interest, and if the UN secretary general asks us to do so," he said.
Russia, a long-time ally and arms supplier to Syrian President Bashar Assad, has been trying along with Western powers to bring the warring sides in Syria together into talks, on a solution to the more than two-year-old conflict.
The UN Security Council will meet on Friday to discuss the Austrian withdrawal after anti-Assad rebels briefly seized the crossing between Israel and Syria, sending UN staff scurrying to bunkers before Syrian soldiers managed to push them back.

UN can't accept Russia Golan offer

The United Nations on Friday thanked Russia for offering to replace peacekeepers from Austria in the Golan Heights but said an agreement between Israel and Syria bars all permanent members of the Security Council from the UN observer mission there.
President Vladimir Putin made the offer in Russia on Friday after Vienna said it would recall its troops from a UN monitoring force due to worsening fighting in Syria.
Austria, whose peacekeepers account for about 380 of the 1 000-member UN force observing a 4-decade-old ceasefire between Syria and Israel, said it would pull out after intense clashes between Syrian government forces and rebels on the border.
But UN spokesperson Martin Nesirky said it was impossible for the United Nations to accept the offer from Russia, which along with the United States, Britain, France and China, is a permanent veto-wielding member of the 15-nation Security Council.
"We appreciate the consideration that the Russian Federation has given to provide troops to the Golan," he told reporters. "However, the Disengagement Agreement and its protocol, which is between Syria and Israel, do not allow for the participation of permanent members of the Security Council in Undof."
The departure of the Austrians from the United Nations Disengagement Observer Force is the latest blow to monitoring force. In addition to the increased fighting in its zone of operation, there have been several recent incidents in which Syrian rebel forces detained Undof monitors.
Since 1974 Undof has had the task of monitoring the "area of separation," between Syrian and Israeli forces, a narrow strip of land running 45 miles from Mount Hermon on the Lebanese border to the Yarmouk River frontier with Jordan. The force has helped keep the area relatively stable, UN diplomats say.
Russia, an old ally and arms supplier to Syrian President Bashar Assad, has been trying along with Western powers to bring the warring sides in Syria together into talks on a solution to the more than 2-year-old conflict. A planned Geneva peace conference has been delayed until July at least.
The UN Security Council will meet later on Friday to discuss the Austrian withdrawal after anti-Assad rebels briefly seized the crossing between Israel and Syria, sending UN staff scurrying to bunkers before Syrian soldiers managed to push them back.
Nesirky said a meeting was under way between UN peacekeeping officials and troop contributing countries to find a member state willing to offer monitors to replace the departing Austrians, who make up a third of the force.

Obama defends phone spy programme

President Barack Obama on Friday staunchly defended the sweeping US government surveillance of Americans' phone and internet activity, calling it a modest encroachment on privacy that was necessary to defend the United States from attack.
Obama said the programmes were "trade-offs" designed to strike a balance between privacy concerns and keeping Americans safe from terrorist attacks. He said they were supervised by federal judges and Congress, and that lawmakers had been briefed.
"Nobody is listening to your telephone calls. That's not what this program is about," Obama told reporters during a visit to California's Silicon Valley.
"In the abstract you can complain about Big Brother and how this is a potential programme run amok, but when you actually look at the details, I think we've struck the right balance," Obama said. "There are trade-offs involved."
The Washington Post reported on Thursday that federal authorities have been tapping into the central servers of companies including Google, Apple and Facebook to gain access to e-mails, photos and other files allowing analysts to track a person's movements and contacts.
That added to privacy concerns sparked by a report in Britain's Guardian newspaper that the National Security Agency had been mining phone records from millions of customers of a subsidiary of Verizon Communications.
The two reports launched a broad debate about privacy rights and the proper limits of government surveillance in the aftermath of the 11 September, 2001, attacks in the United States.
Obama, who pledged to run the most transparent administration in US history, said in his first comments on the controversy that he came into office with a "healthy skepticism" about the surveillance programmes but had come to believe "modest encroachments on privacy" were worth it.
Obama said his administration also had instituted audits and tightened safeguards to ensure the programs did not overstep their bounds.
Make choices
"You can't have 100% security and also then have 100% privacy and zero inconvenience," he said. "We're going to have to make some choices as a society."
Obama may be forced to broach the subject during his meetings with Chinese President Xi Jinping at a California summit on Friday, in which US concerns about alleged Chinese hacking of American secrets were expected to be high on the agenda.
While members of the US Congress are routinely briefed by the NSA on secret surveillance programmes, it is not clear how much they knew about the widespread surveillance of private internet activity.
Representative Henry Waxman, a California Democrat, said he thought the administration had good intentions but stressed the programme was "just too broad an overreach."
"I think there ought to be some connection to suspicion, otherwise we can say that any intrusion on all of our privacy is justified for the times that we will catch the few terrorists," Waxman told MSNBC. "Good intentions are not enough. We need protections against government intrusion that goes too far."
The Washington Post said the surveillance program involving firms including Microsoft, Skype and YouTube, code-named PRISM and established under Republican President George W Bush in 2007, had seen "exponential growth" under the Democratic Obama administration.
It said the NSA increasingly relies on PRISM as a source of raw material for its intelligence reports.
James Clapper, the director of national intelligence, said the report contained "numerous inaccuracies," and some of the companies identified by the Washington Post denied that the NSA and Federal Bureau of Investigations (FBI) had "direct access" to their central servers.
Microsoft said it does not voluntarily participate in government data collection and only complies "with orders for requests about specific accounts or identifiers."
Erwin Chemerinsky, a law professor at the University of California, Irvine, said the program was "deeply disturbing" and went beyond what was constitutionally acceptable.
"It is a huge gathering of information by the federal government. The argument that it protects national security is unpersuasive," he said.

NEWS,07.04.2013

French minister confirms 0.1% growth

French Finance Minister Pierre Moscovici said Sunday that France's economy was expected to grow just 0.1% this year, revising downward an official target as the country struggles to get back on its feet.

The French government had initially forecast 0.8% growth in 2013 for the eurozone's second largest economy, which continues to battle rising unemployment, stagnant growth and a stubborn budget deficit.

Speaking on Europe 1 radio, Moscovici also predicted growth for 2014 at around 1.2%.

For 2015, "I think French growth will get back to a cruising speed that will enable it to create jobs," he said, pointing to an expected growth of 2%.

His 2013 prediction confirms those already made by the European Commission and Organisation for Economic Cooperation and Development, which both forecast that the French economy would manage to grow by just 0.1% this year.

Moscovici already said last week that he "feared" growth in France would be around that figure, and Sunday's announcement confirmed this.

Last month, French President Francois Hollande insisted that the country's promised turnaround was still on course, despite near record unemployment, a drop in household purchasing power and thousands of layoffs.

Offshore accounts data reveal crimes

A trove of data obtained by a US-based journalists' group that details thousands of offshore accounts reveals several instances of swindles and other financial crimes, The Washington Post newspaper reported Sunday.

Among the 4 000 US individuals listed in the records, at least 30 were American citizens accused in lawsuits or criminal cases of fraud, money laundering or other serious financial misconduct, the report said.

They include billionaire hedge fund manager Raj Rajaratnam, who was convicted in 2011 in one of the biggest insider trading scandals in US history, and Paul Bilzerian, who was convicted of securities fraud, the paper noted.

The report was the latest by prominent newspapers around the world which were given copies of the data for scrutiny by the Washington-based International Consortium of Investigative Journalists.

The head of the ICIJ, Gerard Ryle, obtained the data, involving 2.5 million records of more than 120 000 companies and trusts set up by two offshore companies operating in the British Virgin Islands and in Asia and the South Pacific, on a hard drive after investigating a fraud and offshore haven case in Australia.

Several newspapers, including France's Le Monde and Britain's Guardian, have been publishing revelations based on the data.

The Washington Post's report said the records contained information on at least 23 companies linked to an alleged $230m tax fraud in Russia that was investigated by a Moscow-based lawyer named Sergei Magnitsky.

After Magnitsky informed Russian authorities of his findings, he was accused of fraud himself and thrown in prison, where he died in 2009 under suspicious circumstances.

One of the companies mentioned in the records was used to set up Swiss bank accounts, into which the husband of a Russian tax official deposited millions in cash, the paper said.

Today, there are between 50 and 60 offshore financial centers around the world holding billions of dollars at a time of historic US deficits and budget cuts, The Washington Post said.

Groups that monitor tax issues estimate that between $8 trillion and $32 trillion in private global wealth is parked offshore, according to the paper.

According to fraud experts, offshore bank accounts and companies are vital to those wishing to conceal complex financial crimes.

For example, Allen Stanford, who ran a $7bn Ponzi scheme, used a bank he controlled in Antigua, The Post noted.

And Bernard Madoff, who ran the largest Ponzi scheme in US history, used a series of offshore "feeder funds" to fuel the growth of his scam.

The Washington Post quoted a top official in the US Justice Department's fraud section, Paul Pelletier, as saying US owners of offshore accounts were sometimes trying to hide money from US tax authorities, law enforcement or regulators.

"As a prosecutor, it was very difficult pursuing these people," he said.

Italy to pay €40bn owed to business

The Italian government on Saturday gave its go-ahead for a bill to repay €40bn in debts owed to the private sector over the next 12 months in a bid to stimulate growth.

"The cabinet meeting today approved an urgent decree to pay back the debts of the public sector to the private sector," Prime Minister Mario Monti told a press conference after the talks.

US preparing for possible N Korea actions

The top US military officer said on Sunday the Pentagon had bolstered its missile defences and taken other steps because he "can't take the chance" that North Korea won't soon engage in some military action.
Heightened tensions with North Korea led the United States to postpone congressional testimony by the chief US commander in South Korea and delay an intercontinental ballistic missile test from a West Coast base.
North Korea, after weeks of war threats and other efforts to punish South Korea and the US for joint military drills, has told other nations that it will be unable to guarantee diplomats' safety in the North's capital beginning Wednesday.
US General Martin Dempsey, the Joint Chiefs of Staff chair who just wrapped up a visit to Afghanistan, was asked in an Associated Press interview whether he foresees North Korea taking military action soon.
"No, but I can't take the chance that it won't," he said, explaining why the Pentagon has strengthened missile defences and made other decisions to combat the potential threat.
Dempsey said the US has been preparing for further provocations or action, "considering the risk that they may choose to do something" on one of two nationally important anniversaries in April - the birth of North Korean founder Kim Il Sung and the creation of the North Korean army.
US General James Thurman, the commander of the 28 000 American troops in South Korea, will stay in Seoul as "a prudent measure" rather than travel to Washington to appear this coming week before congressional committees, Army Colonel Amy Hannah said in an e-mail on Sunday to the AP.
Thurman has asked the Senate Armed Services Committee, the House Armed Services Committee, and the House Appropriations subcommittee on defence to excuse his absence until he can testify at a later date.
Dempsey said he had consulted with Thurman about the rising tensions on the Korean peninsula.
Missile test

The Pentagon has postponed an intercontinental ballistic missile test that was set for the coming week at Vandenberg Air Force Base in California, a senior defence official told the AP on Saturday.

The official said US Defence Secretary Chuck Hagel decided to put off the long-planned Minuteman 3 test because of concerns the launch could be misinterpreted and exacerbate the Korean crisis. Hagel made the decision on Friday, the official said.
North Korea's military said this past week that it was authorised to attack the US using "smaller, lighter and diversified" nuclear weapons.
North Korea also conducted a nuclear test in February and in December launched a long-range rocket that could potentially hit the continental US.
The US has moved two of the Navy's missile-defence ships closer to the Korean peninsula, and a land-based system is being deployed to the Pacific territory of Guam later this month. The Pentagon last month announced longer-term plans to strengthen its US-based missile defences.

Citing North Korea's suggestion that diplomats leave the country, South Korean President Park Geun-hye's national security director said the North may be planning a missile launch or another provocation around Wednesday, according to presidential spokesperson Kim Haing.

In Washington, an adviser to President Barack Obama said "we wouldn't be surprised if they did a test. They've done that in the past."

US Senator John McCain said the North's young leader, Kim Jong Un, is playing a game of brinksmanship.

"In the past we have seen this repetitious confrontation, negotiation, incentives to North Korea to better behave, hopes that they will abandon their nuclear quest - which they never will, otherwise, they'd be totally irrelevant," McCain told CBS's Face the Nation.
"And so we've seen the cycle over and over and over again, for last 20 or 30 years. They confront. There's crisis. Then we offer them incentives - food, money. While meanwhile the most repressive and oppressive regime on earth continues to function," he added.
McCain said China "does hold the key to this problem. China can cut off their economy if they want to."

Israel Holocaust memorial day begins

Israel's annual memorial day for the 6 million Jews killed in the Holocaust has begun with a ceremony marking 70 years since the Warsaw ghetto uprising.
The uprising has come to symbolize Jewish resistance against the Nazis in World War II.
Sunday's main ceremony was taking place at Yad Vashem, Israel's official Holocaust memorial. Israel's president and its prime minister were set to speak before hundreds of Holocaust survivors and their families, Israeli leaders, diplomats and others.
The Israeli flag flew at half-staff, and a military honour guard stood at one side of the podium as poems and psalms were read and the Jewish prayer for the dead was recited.
The annual Holocaust memorial day is one of the most solemn on Israel's calendar.

Acting president fears death plot

Venezuela's acting president Nicolas Maduro has accused former US officials Roger Noriega and Otto Reich of plotting to kill him to prevent his victory in next week's presidential elections.
Speaking at a televised campaign event on Saturday, Maduro said the plot also involved "right-wing forces" from El Salvador, which had already dispatched paid assassins to Venezuela to implement the plan.
"Their goal is to kill me," said Maduro, who had been designated by the late Venezuelan leader Hugo Chavez as his heir apparent. "They want to kill me because they know they cannot win free and fair elections."
A presidential election to replace Chavez, who died of cancer last month, will be held on 14 April.
Maduro said part of the plot also involved sabotaging the nation's electrical grid.
Parts of oil-rich Venezuela suffer from regular power outages, a problem opposition leader Henrique Capriles had seized upon to criticise the socialist government that Chavez led for 14 years until his death on 5 March.
On Thursday, Maduro also accused the opposition of plotting to sabotage the national power grid to cause a blackout ahead of the election.
A conservative Mexican-American, Roger Noriega served as US Permanent Representative to the Organization of American States (OAS) from 2001 to 2003.
Otto Reich, a Cuban-American, was the US president's special envoy for the Western Hemisphere, assistant secretary of state and US ambassador to Venezuela.
While vocal critics of Venezuelan policies, both have repeatedly denied any involvement in Venezuelan affairs.

UK wants to change welfare system

Prime Minister David Cameron said on Sunday that Britain's welfare system had "lost its way" and become a "lifestyle choice", amid a raging debate on government cutbacks to state handouts.
Cameron's Conservative-Liberal coalition government, trying to rein in the national budget deficit, is bringing in a series of changes to the system this month - in the face of bitter opposition from the Labour Party.
The debate has been fuelled by the case of Mick Philpott, a nationally notorious welfare-dependent father of 18, who was jailed last week for the manslaughter of six children in setting fire to his own house.
Conservative finance minister George Osborne was blasted by Labour in unusually fierce terms when, asked whether Philpott was a product of the welfare system, he suggested there needed to be a debate about whether taxpayers should be subsidising lifestyles like his.
Opposition Labour finance spokesperson Ed Balls said for Osborne "to link this wider debate to this shocking crime is nasty and divisive and demeans his office".
Writing in The Sun newspaper, Cameron launched a staunch defence of the welfare shake-up, which includes capping the amount a household can claim at national average earnings.
Backfiring
He suggested it was "crazy" that welfare claimants could have a bigger income than workers.
The Conservative leader suggested that a system originally designed to protect the frail and be a "stopgap" was now backfiring.
"It was invented to help people escape poverty, but has trapped too many people in it. It was meant to be a stopgap in hard times, but has become a lifestyle choice for some. It was designed to bring us together, but is causing resentment," he said.
"No-one wants to work hard every day and see their hard-earned taxes being used to fund things they themselves cannot afford or keep generations dependent on welfare.
"So this month we are making some big changes. They are changes that have a simple principle at their heart: we are restoring the fairness that should lie at the very heart of our tax and welfare systems.
"We are saying to each and every hard-working person in our country: we are on your side."
The debate has set not only politicians at each other's throats but also newspapers and commentators of opposing political stripes.
Meanwhile a YouGov opinion poll for The Sun found that six out of 10 voters thought welfare handouts were too generous.
About 67% said the system needed an overhaul while 79% back the government's move to limit a family's welfare payments to 26 000 pounds a year - the average working family income.