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Give Greece A Chance, Again – OpEd

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By Miguel Otero-Iglesias*

A lot of Europeans, especially in Germany and other northern countries, appear to be steadily more unsympathetic towards Greece. Greece’s stubborn defiance is becoming tiresome. Grievances multiply, and have piled up for decades.

Let us recount them briefly here. Greek governments, both Pasok and New Democracy, fiddled accounts to join the euro and later concealed their deficits so as not to be penalized, while they severely mismanaged the crisis since 2009. George Papandreou was oblivious to the storm that was gathering and had to retire with his tail between his legs after not being able to call a referendum on the first rescue package.

Antonis Samaras was little better. When in opposition he unfailingly insisted that the memorandum of understanding Papandreou signed with the Troika was dishonorable and was leading the country’s economy to disaster, although once in office he lost no time in signing an adjustment program that was very similar to the one he had so vehemently opposed. He showed that his only interest was gaining office, and that his priority was party over country.

The Greek two-party system failed to prepare the country for globalization. The political elites dispensed cash and favors to gain votes, essentially a patriarchal system. For a government employee, or for someone with a patron in the system, a comfortable life was merely dependent on a continuation of the traditional set-up, while those outside this system had only limited chances of social advancement. The pattern was replicated in the private sector, dependent on public sector favoritism for contracts.

Greece had become a rentier state, dependent especially on the following: income from tourism (due to the sun and beaches); seaborne transport, thanks to its geographical location; real estate (those who could buy a second or third property relied on rentals in the black economy); the domestic expenditure of civil servants and pensioners; and on foreign lending, both private (with many German and French banks encouraging Greek consumption by way of cheap loans) and public, through EU cohesion funds. This external financing was necessary to cover the current account’s structural deficit.

With such a weak economic structure there were few incentives to innovate and produce. Young people who dropped out of school worked in the tourist sector, construction or the black economy, while university graduates had four options: (1) attempt to become civil servants to gain a “tenured” job; (2) exploit family contacts to get decent work; (3) in the absence of patrons, make the best of it and end up frustrated in a substandard job; or (4) emigrate. The best-educated Greeks are in exile in the U.S., the U.K. or Germany.

Despite these drawbacks, for a time the Greek economy grew extraordinarily. Like Spain and Portugal, Greece had shed a dictatorship and there was much to build in the 1980s and 90s. Then came the triumphant first years of the 21st century, with the Athens Olympics and the national football team winning the 2004 European championship. The average Greek had a good life. Retirement age was, on average, 56 in the public sector and 60 in the private. Pensions were, and continue to be, extremely important, because they boost domestic demand and, at the same time, given the patchiness of the welfare state, are the only regular sources of income for families with a spouse or son or daughter lacking employment.

Alas, the crisis has brought the system tumbling down. Foreign lending has evaporated, the real estate sector has collapsed, wages and pensions have been cut by 40 percent, GDP has fallen by a spectacular 25 percent, the EU has doled out the biggest bail-out in the EU’s history (in exchange for reforms and cuts) and two-party dominance has given way to Syriza, a party of the radical left which has championed the rejection of austerity and the demand for debt restructuring. This is the programme that has taken it to power and that it has defended tooth and nail — as we’ve seen in the “Oxi” vote.

“Kick them out of the euro,” many in Europe say. The idea of amputating the gangrenous Greek limb is gaining adepts. Germany’s Minister of Finance Wolfgang Schäuble is at the forefront of this camp.

But this attitude is a mistake. Compliance with the rules is important, but politics even more so. Can Europe allow itself to see the eurozone, the clearest exemplar of European unity, split apart? What message would the world receive? What sort of a political project would throw its weakest members overboard at the first sign of trouble? To say nothing of geostrategic and geopolitical factors: Does Europe really want Greece to submit to Vladimir Putin’s Russia?

There are historic times when both leaders and their people, if they wish to continue united and earn the respect of the rest of the world, have to look beyond domestic economic interests and legal niceties. Despite their criticism of Tsipras’ attitude, most Spaniards — my compatriots, who are better placed to understand Greek woes than, say, the German — seem to get the underlying issue.

The latest Elcano Royal Institute barometer (BRIE) shows that 65 percent of Spaniards surveyed believe that Greece should recover economically before paying its debts. That is an intelligent response. Greece is prey to many problems, but that does not mean it is incapable of transforming itself from a rentier state to a modern economy. Greece should be given a last chance to reform itself.  Are you listening, Frau Merkel?

About the author:
*Miguel Otero-Iglesias, Senior Analyst for International Polical Economy, Elcano Royal Institute | @miotei

Source:
Elcano Royal Institute, and published on 10/7/2015 in Politico. Updated and translated from original version in Spanish: Grecia: ¿torniquete y amputación?.

The post Give Greece A Chance, Again – OpEd appeared first on Eurasia Review.


Ethanol And Biodiesel: Guilty As Charged – OpEd

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Bogus biofuel trading costs us millions – while the absurd biofuel program costs us billions

Two notorious crooks are helping us wrap up another sordid episode in the saga of the United States biofuel mandates, while further highlighting how bungled and long past its expiration date the program is.

Congress concocted the mandates over fears that US gasoline demand would rise forever and keep the United States dependent on foreign oil, as America’s supposedly limited reserves were depleted. The mandates currently require that we blend 15 billion gallons of ethanol with gasoline every year, and produce over a billion gallons of biodiesel. They hammer us consumers every time we fill our tanks.

Turning corn into ethanol requires vast amounts of land, fertilizers, pesticides, tractor and truck fuel, and natural gas for distillation. It enriches some farmers but raises animal feed prices and thus the cost of beef, pork, chicken, eggs, fish and international food aid. Biodiesel from restaurant waste oil makes some sense, but making it from palm oil or soybeans has similar negative ecological impacts.

The ethanol mandate encourages farmers to plow wildlife habitats and fallow fields to grow corn, releasing millions of tons of carbon dioxide. Ethanol gets one-third less mileage per gallon than gasoline, so motorists get fewer miles per tank and per dollar. It produces ozone, attracts water and corrodes car and small engine components, forcing us to spend billions on repairs.

The tale of Philip Joseph Rivkin (aka Felipe Poitan Arriaga) reveals an equally disgusting aspect of the mandate, resulting from the absurdly complex Renewable Identification Number (RIN) system devised by EPA bureaucrats. As Ron Arnold explains in our book, Cracking Big Green, EPA requires that every gallon of biofuel must also have its own unique 38-digit RIN. That’s billions of RINs per year!

“Dry” RIN paper credits are supposed to be associated with actual “wet” gallons of biofuel: corn-based ethanol, biomass-based diesel or nonexistent “advanced cellulosic” fuels. When fuels are not available, refiners can buy RINs from another party that was able to blend the fuel. This “tradable credits” market creates irresistible opportunities for “entrepreneurs” like Rivkin, whose Green Diesel company sold phony biodiesel RINs to oil companies and brokers.

Between 2011 and 2012, Rivkin sold $29 million worth of phony RINs, without producing a single gallon of anything. Secret Service agents arrested him last year in Houston, after he had been expelled from Guatemala, where he had falsely claimed to be a citizen. He plead guilty and now faces ten years in prison, millions of dollars in fines, and the forfeiture of his Lamborghini, Maserati, Canadair LTD plane, $29 million in cash, and an art collection valued in the millions.

His escapade copied what Rodney Hailey pulled off in Perry Hall, Maryland. He rented a garage, filled it with pipes, tanks and pumps (none connected to one another), registered his Clean Green Fuel company with EPA, put up a fancy website, and claimed he would produce 20 million gallons of biodiesel annually from recycled cooking oil. Through a network of traders, Hailey sold more than 32 million bogus RINs for $9 million, while still collecting unemployment.

Eventually, his fancy house, 20 luxury cars and lavish lifestyle attracted law enforcement. In 2013, he was sentenced to 12-1/2 years in prison and ordered to pay more than $42 million in restitution: his sleazy profits plus what his victims had to pay for valid replacement RINs.

The good news is that Rivkin and Hailey will have to pay for their fraudulent actions. (How many other biofuel crooks have not been caught we have no way of knowing.) The bad news is that the RIN system is still in place, under a misguided federal law that benefits almost no one outside the biofuel industry. The worse news is that the cost of their fraud pales by comparison to the lies and fraud perpetrated by EPA and its climate crisis, clean energy and ultra-pure air allies.

Since the biofuel mandate was imposed in 2005 and expanded in 2007 under the Renewable Fuel Standard, it has sent billions of taxpayer and motorist dollars to corn farmers and ethanol producers. It has cost consumers countless billions in reduced mileage, higher food prices, and repairs to their cars, trucks, boats, snowmobiles, chain saws and other small engine equipment. The corn converted into biofuel each year is enough to feed 412 million malnourished people in African and other countries.

Antique autos and other older cars are not compatible with fuels containing ethanol, especially E15 (15% EtOH). Gaskets and other rubber parts can fail, causing fuel leaks and even engine failure or fires. On boats, fiberglass fuel tanks deteriorate and outboard motors can overheat and stop functioning. On airplanes – well you don’t want to ponder what happens when your engine stalls at 10,000 feet.

Many consumers – even corn farmers with older tractors – prefer straight gasoline, which is increasingly hard to find. Nevertheless, in 2014, straight gasoline accounted for almost 7% of total US gasoline sales, double the 3.4% of pure gasoline sold in 2012.

Meanwhile, worries about “peak oil” and “over-dependence” on foreign oil have nearly evaporated. Thanks to fracking and other advanced drilling technologies, the United States is now the world’s largest producer of oil and natural gas. As consumers drive less and invest in more fuel-efficient newer vehicles, gasoline demand is moderating, after peaking in 2007.

And the other justification for ethanol, “dangerous manmade climate change,” is steadily being exposed as just another über-expensive ecological scare.

If consumers want “alternative fuels,” natural gas presents more viable, environmental, free-market, cost-competitive choices. Compressed into high-pressure tanks, it can (and already does) power cars, trucks, taxis and buses. Converted into methanol, our abundant natural gas would enable Detroit to build light, powerful, low-pollution, high octane engines that get better mileage than ethanol-tainted fuels. Existing cars can be converted into “flex-fuel” vehicles for less than $100 – and producing the natural gas and converting it into methanol involves minimal land impacts, no food price hikes and no harm to engines.

Biofuels are guilty as charged. They do to motorists, taxpayers and consumers what wars and riots do to cities. Justifying legislative mandates by saying they create jobs for a few corn growers, biofuel producers and engine repairmen is akin to claiming mobs and warfare foster employment for insurers, firemen, carpenters and window repair companies. The perverse logic also ignores jobs destroyed and businesses destroyed or relocated, and the far better ways our billions of dollars could have been spent.

Politicians, bureaucrats and eco-activists clearly care little about the coal mine workers and communities they have destroyed. Why should biofuel producers be more sacrosanct and protected – based on false claims that these fuels ensure emission reductions, “home-grown” energy supplies and climate stability?

The Renewable Fuel Standard and biofuel mandates do more harm than good. They have outlived their usefulness and should not merely be “fixed,” as some suggest, but scrapped entirely.

Americans should no longer be forced to prop up crony-corporatist biofuel companies and pay for expensive repairs under outdated congressional and EPA edicts.

The post Ethanol And Biodiesel: Guilty As Charged – OpEd appeared first on Eurasia Review.

The Maritime Silk Road And China-Southeast Asia Relations – Analysis

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By Zhao Hong*

ASEAN-China relations have improved dramatically since the inking of their strategic partnership in 2003. Bilateral trade increased more than six-fold from US$60 billion in 2003 to over $500 billion in 2014, and Chinese investment in Southeast Asia increased from US$0.12 billion in 2003 to US$7.3 billion in 2013. While the degree and nature of China’s economic importance vary among individual ASEAN countries, China is a critical economic partner for all ten of them. It is the most important export market for Malaysia, Singapore, Laos, and Cambodia and the largest foreign investor in Cambodia, Laos and Myanmar.

However, greater economic cooperation with Beijing since 1990s seems to have failed to spill over into the political security realm, and Southeast Asian states continue to be concerned to varying degrees about China’s growing military capabilities and the lack of transparency about its intentions. Although the past few years have witnessed increasing economic ties between China and Southeast Asia, Beijing has found that its growing geo-economic strength does not necessarily translate into concomitant geopolitical influence and mutual trust.

Thus it is believed that China needs to ease up on its “economy-oriented” policy, and to take into consideration the political and security demands of its southerly neighbours.1 Chinese analysts have indeed opined that the best way for China to build its “international reputation” is by “taking on more responsibilities in international security” which means “providing the entire world and all regions with more public security goods”.2 It would seem therefore that Beijing, through policies such as the promotion of free trade agreements, infrastructure investment and the development of maritime cooperation, hopes to mend and improve its security relations with Southeast Asian countries. It was against such a background that it the New Maritime Silk Road initiative was proposed.

THE MARITIME SILK ROAD AND THE CONCERNS OF ASEAN COUNTRIES

Chinese President Xi Jinping proposed the Maritime Silk Road (MSR) – now a part of the “One Belt, One Road” initiative – during his visit to Indonesia in October 2013. The main aim of this broader initiative is for China to develop its landlocked western provinces and enable them to access the markets of Southeast Asia and the Middle East. The MSR is an attempt to promote economic cooperation and connectivity by reviving the ancient maritime Silk Road trading route, and US$40 billion has been pledged to the Silk Road Fund to this end. China has also established the Asian Infrastructure Investment Bank (AIIB) to develop infrastructure along the route.

While Southeast Asian countries may laud some of Beijing’s initiatives, their view of the long-term trajectory of their economic ties to China is also tinged with caution, for two reasons. First, as the economic size and power of China have expanded tremendously relative to Southeast Asia since the 1990s, this growing asymmetry alone worries some in the region, and poses an important obstacle to China’s ability to convince ASEAN countries that its intentions are benign. Thus, as an analyst has said, “even given China’s and ASEAN’s common sense of vulnerability and common grievances against larger Western powers, China remains a major power in the eyes of ASEAN”.3 This suggests that ASEAN governments continue to view China’s foreign policy with some measure of mistrust and suspicion with regards to the stability of the region.4

This is especially so in light of Beijing’s growing assertiveness in terms of its energy resource exploration, maritime claims and frequent military activities in the South China Sea. In Myanmar, the desire to balance overwhelming dependence on China is frequently cited as a strong impetus for the country’s political and economic opening in 2011 and its efforts to establish positive relations with the EU, Japan and the US.

In Vietnam, popular anger over China’s large economic role, coupled with a strongly nationalistic response to maritime disputes with China, has cast a large shadow over economic relations between the two. China is Vietnam’s largest trading partner and their bilateral trade had increased by a phenomenal amount, from US$8.2 billion in 2005 to $103.5 billion. In the process, Hanoi suffers a growing trade deficit with China which reached US$64 billion in 2014.5 Vietnam is closely integrated into regional supply chains, and many of its factories depend on inputs from China. Its leadership is acutely aware of deep public mistrust and antipathy towards China and that safeguarding Vietnam’s interests in the South China Sea is therefore critical to the government’s legitimacy.

Second, ASEAN countries may worry that being overly dependent on China economically would allow Beijing to undermine their foreign policy. For example, the Philippines, the second largest Southeast Asian state by population, seems to be excluded from the Maritime Silk Road. Some Western scholars believe that China may have intentionally avoided the Philippines, implying that “the smaller countries around China need to accommodate themselves to the values and interest of China to avoid the loss of rights and privileges in the Community of Common Destiny sponsored by China”.6 Indeed, ASEAN is concerned that China might “use economic incentives to lead ASEAN into broader and deeper ‘all-dimensional’ cooperation” and threaten the regional body’s unity.7 They fear that “in the long run, when China’s growing economic power morphs along more strategic-oriented pathways, pressure will mount on ASEAN members to reciprocate China’s regional and global interests.”8

ASEAN’s caution and concerns are not surprising. After all, the share of ASEAN’s trade with China in its total external trade increased from 7.6% in 2003 to 13% in 2012, and China’s FDI in Southeast Asian countries rapidly increased from US$120 million to US$7.3 billion in 2013 although its share in ASEAN’s total FDI inflow is still limited. The relationship is not a balanced one: ASEAN registers a substantive trade deficit with China, which increased from US$2.4 billion in 2008 to $63.7 billion in 2014.9 ASEAN also invests more in China, but at a much slower than China’s capital inflow into the region. What is more striking is that China’s economic growth has profoundly changed the structure of the regional political economy by causing most Southeast Asian economies to become significantly reoriented into a regional production network centred on China,10 and it has been suggested that “the Silk Road clearly reflects China’s ambitions to create a China-centric, albeit still open, Asian order”.11

THE SOUTH CHINA SEA AND THE MARITIME SILK ROAD

Under President Xi Jinping, China’s South China Sea policy has undergone a major adjustment, from an emphasis on rhetorical sovereignty claims to vigorous maintenance of rights through selective actions. On the other hand, with its new periphery diplomacy, Beijing considers its strategy on the South China Sea issue to be crucial to its ASEAN policy, driving it to adopt some flexible measures. China conditionally welcomes a CoC (Code of Conduct) arrangement based on a six-point guidance for China-ASEAN negotiations under Indonesian auspices;12 put forward the South China Sea “two-track approach”, which states that China would cooperate with ASEAN collectively to de-escalate tensions, and simultaneously work with each claimant on resolving differences through consultation.13 Indeed, if everything remains at the status quo, the South China Sea issue is low in Beijing’s diplomatic priority, especially in the framework of China-ASEAN relations.

Yet, the South China Sea dispute is far from being resolved and could become an obstacle in the building of the Maritime Silk Road. For example, the prospect for joint development of maritime resources in the South China Sea has been under discussion since the early 1990s. Yet little progress has been made up. From the Southeast Asian perspectives, Beijing has not suggested that the ‘shelving’ of the territorial disputes and the promotion of joint development mean that their sovereign claims have become less strong or that joint development would lead to longer-term prospects for territorial compromises,14 as China had indicated that “Beijing would only concede to joint cooperative activities if the other claimants first acknowledge Chinese sovereignty over the South China Sea”.15 While China believes that domestic regime change and resource nationalism are the main factors for the failure of joint development,16 as in the case of the Philippines where it has been claimed that “a joint venture with China on equal terms would be a violation of the country’s constitution”.17 Hence, the claimant states have continued to argue over the sovereignty issue instead of temporarily shelving it to benefit the establishment of a joint development scheme.

For China, the construction of “One Belt One Road” is the primary strategic objective for the time being. It cannot be easily separated from the South China Sea question, especially in light of the new round of dispute escalation since April this year. It is essential for China to still (or at least significantly reduce) the security concerns of ASEAN countries. Thus, as some Chinese scholars suggest, it is necessary for China to move on to the following matters instead: clarifying its South China Sea assertion and substantiating its insistence on the nine- dotted line;18 putting forward its own roadmap for dispute resolution and promoting a new collective security concept. A new security concept can be broad and flexible, and include binding multilateral security mechanisms, multilateral forms, bilateral security consultations and non-official academic security dialogues.19 Moreover, taking into account the fact that the large-scale construction of islands will have an impact on the claims of ASEAN countries, it is appropriate for China to disclose information relating to the island’s construction scale and its overall use.20

Some scholars have suggested that China should adjust its terrestrial conception of bounded space. For example, Hans Dieter-Evers holds that the South China Sea is one of many “Mediterranean seas”. It is typically bordered by a number of distinct states and surrounded by narrow outlets to oceans or other seas.21 All Mediterranean seas experienced periods of intensive trade relations, exchange of knowledge, economic prosperity and the flowering of science, religion and innovation.

But unlike other Mediterranean seas, in spite of intensive trade relations and cultural exchanges, the South China Sea remains an entity only in name. Indonesians, Malaysians and Filipinos concentrate on their own seas, such as the Sulu, Sulawesi and Java seas and the Strait of Malacca, and theirs is basically a maritime conception of free and undefined space; while the Chinese view appears to be land based, and considers the South China Sea as a bounded and exclusive sovereign territory.22 This adds difficulty to the resolving of maritime disputes. One illustration is that “China has long called for joint development, but other claimant-states’ unease with Beijing’s premise of ‘indisputable sovereignty’ has prevented any progress on the idea”.23 Dieter-Evers hopes that “the Chinese terrestrial conception of bounded space can be changed into a maritime conception to allow a solution of the claims to the South China Sea.”24

Southeast Asia has since ancient times been an important hub along the ancient Maritime Silk Road. The Chinese people had ventured into Southeast Asia, traditionally called Nanyang by them, and China had in fact already been conducting maritime activities along its coastline and in the Nanyang well before Admiral Zheng He’s expeditions (1405-1433). By the Song Dynasty (960-1280), Imperial China had established tributary relations with many states in the Nanyang, and the tribute-bearing missions were, as observed by Harvard’s eminent historian John K Fairbank, a convenient “cloak for trade”.25

The new MSR initiative aims to create a modern network of high-speed railways, motorways, pipelines and ports stretching across the region. Beijing has also called for building a community with “shared interests, destiny and responsibilities” which entails further embracing of the international marketplace, and provides a vision for durable security for the region.
Indeed, as the largest country among the claimant states in the South China Sea and a major power in Asia Pacific and the world, China should exercise more leadership in facilitating joint development in the South China Sea. This holds prospects for longer-term territorial compromises and can become an underpinning factor for peace and stability in the region.

CONCLUSION: TOWARDS A NEW REGIONAL ORDER?

ASEAN countries have an immense stake in maintaining good relations with China, but many of them are certainly apprehensive about how China will choose to use its power. As of now, ASEAN continues to adopt a dual approach towards the US and China. While most ASEAN states “have welcomed America as a hedge against growing Chinese power, their economies have become increasingly dependent upon China and they don’t want to be a party to any potential conflict between these two giants”.26 While they continue to rely on the US on security matters, they have responded enthusiastically to China’s numerous economic initiatives. The disconnection between China’s economic strength on the one hand, and the significant security role assumed by the US on the other highlights the imbalance of power in the region.27

Good relations with ASEAN countries remain a priority of China’s foreign diplomacy. After disputes in the South China Sea heated up in 2013, China offered an upgraded version of the FTA with ASEAN, and to continue negotiations to develop the CoC, and proposed setting up the AIIB and the Maritime Silk Road fund. This strongly suggests that the importance of the ASEAN region in China’s overall diplomacy layout is on the rise.

The US may still be the predominant power that provides the security public goods that have facilitated the rapid economic growth of most of Asian states, and continue to play an essential role in setting norms and rules for global commerce, but American predominance is being challenged – in part because of the rise of China and other emerging powers and in part because of the relative decline of the US itself. The Obama administration’s strategy to pivot towards Asia and to give higher priority to its relations with ASEAN was aimed to counter- balance China’s growing regional influence, as it sees the AIIB as a political tool for China to pull countries in Southeast Asia tighter into its orbit.28

The relationship between China and the US is one between a rising power and an established dominant power. Competition in Southeast Asia is inevitable although “the balance of interests in the region strongly favours China because the various diplomatic and territorial quarrels roiling East Asia are of much greater salience and concern to China than to the US”.29 While it has become difficult for the US to hold its primacy in the region, China cannot be a single power of domination in the region either. The two powers will have to develop a clearer mutual understanding and greater mutual acceptance, and work together to maintain a balance of power in the region to limit strategic rivalry.30

ASEAN is at the centre of this big power relationship and has been able to establish platforms that could play a supplementary role in channelling the US-China relations in more predictable and constructive directions. American and Chinese interests do intersect in Southeast Asia, and ASEAN is a relatively neutral body friendly to both.31 Therefore, Southeast Asia can help determine whether China and the US can build a new model of big power relations, based on rules and dynamic changes of economic relations developed in the region.

About the author:
* Zhao Hong is Visiting Senior Fellow at ISEAS; e-mail: zhao_hong@iseas.edu.sg

Source:
This article was published by ISEAS as ISEAS Perspective Number 35 (PDF)

Notes:
1. 陈琪、管传靖,“中国周边外交的政策调整与新理念” (China’s peripheral diplomacy adjustment and new ideas),《当代亚太》2014年第3期(Contemporary Asia-Pacific, no.3, 2014).
2. Ibid.
3. Alice D. Ba, “Who’s socializing whom? Complex engagement in Sino-ASEAN relations”, in Theorizing Southeast Asian Relations, edited by Amitav Acharya and Richard Stubbs, Routledge, 2009.
4. Denny Roy, “Southeast Asia and China: balancing or bandwagoning”, Contemporary of Southeast Asia, vol.27, no.2, 2005.
5. China’s Customs Statistics.
6. David Arase, “China’s Two Silk Roads: Implications for Southeast Asia”, ISEAS perspective, #2, 22 January 2015.
7. David Arase, “Explaining China’s 2+7 initiative towards ASEAN”, Trends in Southeast Asia, 2015, #04.
8. Kavi Chongkittavorn, “Pushing East Asia Summit to new level”, The Strait Times, 11 November 2014.
9. China Customs Statistics.
10. Evelyn Goh, “The modes of China’s influence”, Asian Survey, Vol. 54, Number 5, 2014.
11. Yong Deng, “China: the post-responsible power”, The Washington Quarterly, Winter 2015.
12. In his Southeast Asian trip in May 2013, Foreign Minister Wang Yi reiterated Beijing’s willingness to work with ASEAN for a mutually acceptable CoC. But Beijing insists that the CoC is for crisis management and should not touch on EEZ demarcation.
13. Xinhua News Agency, 9 August 2014.
14. Philip Andrews-Speed and Roland Dannreuther, China, Oil And Global Politics, Routledge, 2011, p.147.
15. Ralf Emmers, Resource Management and Contested Territories in East Asia, Palgrave Macmillan, p.61.
16. Cha Wen, “feilibing nanhai zhengce zhuanbian beihou de guonei zhengzhi yiinsu”, (Domestic political factors behind Philippines’ shift in its South China Sea policy) Journal of Contemporary Asia-Pacific Studies, no.5, 2014, pp.120-139.
17. Jeffrey Ordaniel, “The geopolitical stakes of the 2016 Philippine election”, The Diplomat, 28 May 2015.
18. You Ji, “China’s civil-military strategies for South China Sea dispute control”, EAI Background Brief, No.1002, 25 February 2015.
19. Zhang Biwu, “Chinese perceptions of U.S. return to Southeast Asia and the prospect of China’s peaceful rise”, Journal of Contemporary China, 2015, Vol. 24, No.91, 176-195.
20. Xue Li, “China and the US did not enter the South China Sea military conflict countdown”, FT Chinese network, 27 May 2015.
21. Hans Dieter-Evers, “Understanding the South China Sea: an explorative cultural analysis”, IJAPS, Vol. 10, No. 1 (January 2014).
22. Ibid.
23. Jeffrey Ordaniel, “The geopolitical stakes of the 2016 Philippine election”, The Diplomat, 28 May 2015.
24. Hans Dieter-Evers, “Understanding the South China Sea: an explorative cultural analysis”, IJAPS, Vol. 10, No. 1 (January 2014).
25. John Wong and Lye Liang Fook, “Revising the ancient Silk Road: China’s new diplomatic initiative”, East Asian Policy, volume 6, no.3, Jul/Sep 2014.
26. Michael Yahuda, “China’s new assertiveness in the South China Sea”, Journal of Contemporary China, 22:81, 2013.
27. 薛力,“‘一路一带’ 折射的中国外交风险” (China’s diplomatic risk reflected by ‘one road one belt’), FT Chinese net, 30 December 2014 <http://www.ftchinese.com/story/001059886#s=p>
28. Jane Perlez, “U.S. opposing China’s answer to World Bank”, The New York Times, 9 October 2014.
29. Suisheng Zhao, “A new model of big power relations? China-US strategic rivalry and balance of power in the Asia-Pacific”, Journal of Contemporary China, 24:93, 2015, 377-397.
30. Ibid.
31. Bilahari Kausikan, “The idea of Asia”, The Straits Times, 8 November 2014.

The post The Maritime Silk Road And China-Southeast Asia Relations – Analysis appeared first on Eurasia Review.

Trans-Pacific Partnership, India And South Asia – Analysis

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The Trans-Pacific Partnership (TPP) will have multiple impacts on India and South Asia, ranging from a short-term effect, such as the loss of preferential access for exports, to the longer-term impact of having to comply with higher quality-standards. The most significant impact, however, can be the gradual isolation of South Asia from a significant part of global trade governed by new rules.

By Amitendu Palit*

The Trans-Pacific Partnership (TPP) will be formalised soon, with the United States Senate granting US President Barack Obama the fast-track Trade Promotion Authority (TPA) for implementing new free trade agreements. The Senate vote cleared one of the most important hurdles for the TPP. The remaining talks on the trade deal can now be concluded fast, as all negotiating countries look forward to its early commencement.

The TPP will be a game-changer for the world economy and global trade. As one of the most important mega-RTAs (Regional Trade Agreements) in the world economy, the TPP will introduce new rules and systems for global trade. With its 12 members (Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore, the US and Vietnam) accounting for around two-fifths of the world output and a quarter of global trade, the TPP’s rules and writ will cover large chunks of the world economy and trade. Many of the same rules might also be implemented under other mega-RTAs that are being currently negotiated, as well as under new bilateral trade agreements.2

The TPP has implications for several countries including India and others from South Asia. Given that several TPP member-economies are major trade partners of South Asian countries, these impacts would have both short-term and long-term implications, spread over time.

Loss of Preferential Market Access

The TPP is expected to make around 11,000 tariff lines duty-free for its members. This wide-ranging tariff elimination will affect the competitiveness of these exports from countries that currently enjoy duty-free access in the TPP member-markets. The biggest erosion of competitiveness will be in the US market. The US offers duty-free access to around 5,000 items of export from developing countries under its Generalized System of Preferences (GSP). The preferences apply to all countries from South Asia. Non- developing-country TPP members like Australia, Brunei, Japan and New Zealand, which do not have these preferences now, might get duty-free access for many of the products covered by the GSP scheme. Moreover, non-preference-receiving exports from India and other South Asian countries to the US would be affected by the fact that, while their exports will attract duties, similar exports from other TPP members to the US will not.

Tariff-preference erosion is a particularly serious concern for South Asian LDCs (Least Developed Countries) – Afghanistan, Bangladesh, Bhutan and Nepal – that receive additional preferential access in several TPP member-markets. The GSP schemes of Australia, Canada, Japan, New Zealand and the US allow greater preferential access to exports from the LDCs.

These preferences, extended over a greater number of items than for other developing countries, can now get offset to a large extent by tariff eliminations under the TPP. These can result in fairly serious implications for the prospects of some major exports from South Asian LDCs, such as textiles and garments. Garment exports from a competing country which is also a TPP member, like Vietnam, for example, can pose significant challenges for the South Asian LDCs, given the much greater access it will get in the Asia-Pacific TPP markets (e.g. US, Canada, Australia, Japan) that are among the top destinations of the South Asian LDC garment-exports as well.

India’s specific concerns over tariff-preference erosion will extend to the preferential accesses for its exports through the various bilateral and regional agreements it already has with many TPP members. These include bilateral agreements with Chile, Japan, Malaysia, Peru and Singapore. It also gets preferential access to the markets of Brunei and Vietnam through its agreement with the ASEAN (Association of Southeast Asian Nations). Significant preferential market access, in the form of zero or low tariffs currently available to Indian exports through these agreements, can be neutralised post-TPP. Furthermore, India’s existing trade agreements with these TPP members are much narrower than what the TPP will cover in terms of the number of goods that are likely to be made tariff-free. As a result, there will be several Indian exports, both agriculture and manufacturing and including final products, raw materials and intermediates that are expected to continue facing tariffs in these TPP markets, whereas these are likely to become duty-free for all TPP members.

Complying with Tougher Quality Standards

Given that global tariffs are coming down through various regional and bilateral trade agreements, in addition to phased reductions through the multilateral process of the World Trade Organization, tariff-preference erosion from the TPP will be a relatively short-term effect. What can, however, be far more significant for the excluded countries are the effects of higher quality-standards being adopted under the TPP. These standards are expected to be implemented through strict norms for ensuring health and safety of plants, animals, people and the environment. The TPP will implement a series of common standards for its members in this regard. By and large, these standards are likely to reflect those already prevalent in the US and other major TPP member-markets.

High quality-standards, key to gaining market share, have several implications for exports from India and other South Asian countries. Indian and South Asian exports have struggled to meet high standards of developed country markets due to various factors including lack of adequate knowledge of standards, insufficient domestic capacities for standardisation and lack of awareness among both producers and consumers. Several exports from South Asia – agricultural products, fisheries and marine products, minerals, chemicals, leather, textiles and garments, jewellery, metals, mechanical and electrical items – will now have to comply with progressively higher standards in the TPP markets. Such compliance calls for the institutionalisation of higher quality-standards in their domestic markets, in the first instance. The quality standards of the TPP might be more demanding than the basic global standards as fixed by the ISO (International Standards Organisation), given the active role of private industry in fixing these standards. The challenge for India and other South Asian countries will be to continuously upgrade their domestic standards. This is going to be particularly difficult in the areas of food-safety management and carbon-emission norms. For India, these challenges are going to be particularly critical as it aims to integrate deeper in global value chains through ambitious initiatives like ‘Make in India’. High standards would be major imperatives for Indian producers both as suppliers of intermediates as well as processors of final products.

Several South Asian LDCs are yet to develop domestic testing and certification capacities for satisfying high quality-standards. The absence of such facilities is likely to reduce market access for their exports to the TPP markets. Such access will be less globally over time, given that more and more economies might shift to the standards being set by the TPP. Even for India, the largest economy in South Asia, certification capacities must expand far more beyond what is currently available with the BIS (Bureau of Indian Standards). At the same time, the standards for the domestic market will also have to be upgraded and enforced. Large gaps between the domestic and the TPP standards might force exporters towards suboptimal choices.

Absence from the New Trade Governance

The TPP symbolises mega-RTAs aspiring for ‘deep’ trade liberalisation; such liberalisation goes well beyond the cutting of tariffs and into the realm of reforming domestic regulations in sectors that influence cross-border trade in goods and services, and flows of capital, people, technology and knowledge. The TPP is bound to bring in significant changes in the rules governing investments, intellectual property, competition, state procurement, investor-state disputes, labour laws and the environment-management policies of its member-economies. Most of these are areas that the WTO has refrained from legislating on, given their political and social sensitivities for the members. But as the TPP countries, some of which are among the world’s largest economies and trading nations, adopt these regulations, the latter would come to govern a significant part of the global trade.

India has been uncomfortable in discussing and negotiating many of the issues taken up by the TPP. But it can no longer avoid these, given that the TPP will influence other ongoing trade negotiations. Foremost among these is the RCEP (Regional Comprehensive Economic Partnership).3 Despite their far-more moderate ambitions than the TPP, the RCEP negotiations are not immune to the TPP’s influence, because it has several common members (Australia, Brunei, Japan, Malaysia, New Zealand, Singapore and Vietnam). The RCEP is being negotiated across such areas as investment, competition policy and intellectual property issues; the evolving framework of rules in the TPP could well influence the RCEP’s course of negotiations on these subjects. Furthermore, India is also likely to experience the pressure of negotiating these issues in its ongoing bilateral trade talks with the TPP members such as Australia and Canada.

Conclusion

The impact of the TPP on India and South Asia will be much more than the short-term tariff-preference erosions for the region’s exports. The effects are likely to include the challenges of upgrading to new quality standards of the TPP markets and developing long-term strategies for negotiating ‘new’ issues in trade governance.

India’s Foreign Trade Policy (2015-2020), while noting the advent and some of the implications of the TPP, does not spell out any clear strategies for addressing these. But it is essential for India to do so. Otherwise, Indian exports will face increasingly adverse prospects in the TPP markets, as well as in the markets of countries that are negotiating other mega-RTAs, like the EU. A lack of strategic vision for mega-RTAs like the TPP can gradually isolate India and South Asia from a significant part of the global trade space. With much of world trade beginning to fix comparative advantages of national producers on satisfaction of high quality standards and domestic institutional reforms in their countries across a wide range of cross-cutting ‘WTO plus’ issues, India must look closely at the global trade agenda set by the TPP for staying relevant in world trade.

About the author:
1. Dr Amitendu Palit is Senior Research Fellow and Research Lead (Trade and Economic Policy) at the Institute of South Asian Studies (ISAS) at the National University of Singapore (NUS). He can be contacted at isasap@nus.edu.sg. The author, not ISAS, is responsible for the facts cited and opinions expressed in this paper.

Source:
This article was published by ISAS as ISAS Insights Number 284 (PDF)

Notes:
2. The Trans-Atlantic Trade and Investment Partnership (TTIP), Pacific Alliance (PA) and the Regional Comprehensive Economic Partnership (RCEP) are the other major mega-RTAs being negotiated. Several TPP members figure in these negotiations. New bilateral trade agreements like the Canada-EU and China-Australia trade pacts arguably contain several provisions that are there in the TPP as well.
3. The RCEP is being negotiated by the ten-member ASEAN, Australia, China, Japan, India, New Zealand and South Korea.

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Hindu Group Upset At Trivialization Of Lord Krishna At Sydney Gallery

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A US-based Hindu group is upset over what it claims is an inappropriate portrayal of Hindu god Krishna in a sculpture at a current exhibition at Art Gallery of New South Wales (NSW) in Sydney.

A sculpture titled “Everyone no 83” is currently on display as part of the “Conversations” exhibition at the Gallery, which shows Lord Krishna and Radha,  with Krishna apparently wearing sneakers, large earrings, wrist-band/bangle, a contemporary T-shirt underneath of his layers of petals and sports a fashionably cropped beard.

Rajan Zed, in a statement in Nevada (USA), said that Lord Krishna was divine and highly revered in Hinduism and was meant to worshipped in temples or home shrines and not to be thrown around loosely in reimagined versions for dramatic effects in art galleries. Such absurd depiction of Lord Krishna with no scriptural backing was hurtful to the devotees.

Such trivialization of Lord Krishna was disturbing to the devotees, Zed, who is President of Universal Society of Hinduism, stated and urged Art Gallery of NSW to withdraw it from display.

Rajan Zed stressed that Hindus were for free expression as much as anybody else if not more. But faith was something sacred and attempts at belittling it tormented the devotees. Art galleries should be more sensitive while handling faith related subjects, Zed added.

Hindus welcomed galleries and artists to immerse in Hinduism but taking it seriously, respectfully and responsibly and not just for indecorous showing of Hindu symbols and concepts to advance their selfish agenda. Casual flirting sometimes resulted in pillaging serious spiritual doctrines and revered symbols and hurting the devotees, Zed pointed out.

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Sri Lanka: Sirisena Says Education Sector Should Be Enhanced To Make Productive Generation

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The prime concern of education is to empower students with knowledge, abilities and attitudes aiming to make a productive generation. Accordingly, Sri Lanka’s President Maithripala Sirisena said his endeavor is to ensure that similar facilities and opportunities are given to every child in town as well as in village for better education.

Recalling the hardships he endured in his school life by having to walk miles and miles to school, the President said although he reminisces the sweet memories of the bitter experience he gained during school education, he is not prepared to hand down it to the future generation.

“Though I happily recall incidents of my school life with hardships experience by walking miles and miles, I am not ready to allow future generations of children to suffer such hardships,” the President said.

“Therefore, my endeavor is to ensure that similar facilities and opportunities are given to every child in town as well as in village for better education,” he stated.

President Sirisena made these remarks at 150th anniversary celebration of St. Benedict College, Kotahena held on Friday (July 10). The President who arrived there was ceremonially received and escorted by the students of the college.

The President said he would create an education system in which the children can win their future through knowledge, ability and skills.

He pointed out the skill development education is as important as the knowledge-based education. He pointed out that every country in the world that proceeded towards development has implemented such educational policies.

A first day cover and a stamp issued for 150th anniversary celebration were presented to the President at this occasion.

The President also planted a Na sapling in the college premises to mark the 150th anniversary of the college.

Cardinal Malcolm Ranjith, former Archbishop of Colombo Oswald Gomez and Principal of St. Benedict College Mr. Janaka Fonseka were among those participated at this ceremony.

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Promoting Long-Term Care Insurance – Analysis

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Limited insurance for long-term care threatens the sustainability of publicly funded social assistance programs such as Medicaid in the US. This column looks at the effectiveness of a program that encourages middle-income people to save for possible long-term care expenses. The evidence so far indicates that although this program has indeed increased insurance applications, it has not increased insurance uptake.

By Savannah Bergquist, Joan Costa-i-Font and Katherine Swartz*

Incentivising long-term care insurance

Barely 14% of Americans over the age of 50 purchase private insurance to protect against the costs of long-term care needs (Norton 2000, Costa-Font 2012, Frank 2012). As a result, either individuals (or their families) bear the (financial or personal) costs of long-term care, or they turn to Medicaid, the federal-state program for low-income people, to finance their long-term care expenses. The latter option is straining the financial sustainability of Medicaid as a program (as it has been designed to date).

To reduce the financial burden of long-term care on Medicaid, both the federal and state governments have developed strategies that attempt to shift such costs away from Medicaid. These include point-of-purchase incentives, such as state and federal tax deductions, for purchasing long-term care insurance. However, analyses of these strategies indicate limited returns of state tax deductions on the dollar (Goda 2011).

Alternatively, insurance design has been experimenting with incentives targeting the point of use. One version of this strategy includes long-term care partnership insurance contracts, which, in their most common format, allow individuals to purchase long-term care insurance that protects any assets up to the value of insurance coverage so that once exceeded, they become eligible for Medicaid coverage. This strategy is known as the Long-Term Care Partnership Program. Its design attempted to provide an incentive for middle-income people to save more for possible long-term care expenses in their older years and to reduce the use of ‘spend down’ strategies to qualify for Medicaid. The program was initially developed in four states (California, Connecticut, Indiana, and New York) and its extension to the majority of US states has taken place only since 2005 (Meiners 1992, Bergquist et al. 2015a).

Figure 1. Evolution of the total number of contracts, 2000-2008

Figure 1. Evolution of the total number of contracts, 2000-2008

 

Evidence from partnerships

In a recent paper we examine the effects of purchases and applications of long-term care insurance during the period 2000-2008 (both included), and trends in such purchases and applications after the introduction of the Long-Term Care Partnership Program (Bergquist et al. 2015b). We adopt a flexible strategy using a triple interaction model so we can separate the pre-existing trends in the market for long-term care insurance from the effect of the program.

Our findings indicate some interesting results, namely that the Partnership Program expanded insurance applications but not insurance purchases (except for the year of implementation), as Figure 1 reveals.

These findings suggest two implications. First, insurance underwriting of potential insurance consumers is limiting the expansion of insurance uptake. That is, insurance applications are declined for being ‘too risky’ despite consumers being willing to pay the premium. Second, we find a short-term substitution between traditional insurance contracts and the Long-Term Care Partnership Program contracts when they were launched. Other explanations for our results include poor targeting of Partnership Program policies to middle-class individuals, along with poor informational and marketing campaigns for the programs (Bergquist et al. 2015a).

Policy implications

The expansion of private long-term care insurance is subject to a number of barriers. In Europe, social insurance in some countries makes private insurance complementary or supplementary. In the US, even when public insurance is limited to poor people, insurance underwriting limits the potential purchases of private insurance to the middle class who are left without much alternative but to either spend down their wealth or self-insure. In addition, amongst those who manage to get insurance coverage, substantial increases in premiums often cause individuals to allow their insurance contract to lapse. Hence, incentives ought to be more targeted to the middle class, and policies should be put in place to reduce the incentive of insurance companies to only provide coverage to the ‘best risks’.

*About the authors:
Savannah Bergquist, PhD Student in Health Policy, Evaluative Science and Statistics, Harvard University

Joan Costa-i-Font, Associate Professor (Reader) of Political Economy, London School of Economics and Political Science

Katherine Swartz, Professor of Health Economics and Policy in the Department of Health Policy and Management, Harvard T.H. Chan School of Public Health

References:
Bergquist S, J Costa Font, and K Swartz (2015a), “Partnership program for long-term care insurance: the right model for addressing uncertainties with the future?” Aging and Society: forthcoming.

Bergquist S, J Costa-Font and K Swartz, (2015b), “Long Term Care Partnerships: Are they ‘Fit for Purpose’?”, CESifo Working Paper Series 5155, CESifo Group Munich.

Costa-Font, J (2012), “Addressing the incompleteness of long-term care insurance”, VoxEU.org, 9 June.

Costa‐Font J, C Courbage and K Swartz, (2015), “Financing Long‐Term Care: Ex Ante, Ex Post or Both?”, Health Economics, 24, 45-57

Frank, R G (2012), “Long-term care financing in the United States: sources and institutions”, Applied Economic Perspectives and Policy, 34(2), 333-345. doi: 10.1093/aepp/pps016

Goda, G S (2011), “The impact of state tax subsidies for private long-term care insurance on coverage and Medicaid expenditures”, Journal of Public Economics,

Meiners, M R, H L McKay,  and K J Mahoney(2002), “Partnership insurance”, Journal of Aging & Social Policy, 14(3-4), 75-93..

Norton, E C (2000), “Long-term care”, In A J Culyer & J P Newhouse (Eds.), Handbook of Health Economics (Vol. 1): Elsevier Science B.V.

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Where To Invest? Ranking 120 Countries On Their Private Equity Attractiveness

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Which countries offer the most promising markets, strongest institutions, most entrepreneurial support, best protections and strongest corporate governance practices that make investing attractive for venture capital and private equity (VC/PE) professionals?

At the very top of the charts sit the United States, the United Kingdom, Canada, Singapore and Japan. They take positions one through five, respectively, in the 2015 Venture Capital and Private Equity (VC/PE) Country Attractiveness Index, now in its sixth annual edition.

Analyzing 120 countries, based on thousands of data points, and ranking them according to their overall attractiveness to VC/PE investors based on six key drivers, this index is a useful tool for spotting emerging market winners and for assessing risk/reward profiles around the globe. It may also help regulators set or revise policies in order to better attract VC/PE money down the road.

Completing this year’s top ten are Hong Kong (sixth), Germany (seventh), Australia (eighth), New Zealand (ninth) and Switzerland (tenth).

Expanding Scope

For the 2015 index, Malta and Panama were added to the mix, bringing the total up from 118 to 120 countries. The two debuted around the middle of the pack, with Panama ranked 51st and Malta 66th.

The 120 countries are analyzed according to six key drivers measured by 65 individual indicators. The six key drivers are:

  • Economic activity, including GDP and expected GDP growth
  • Depth of capital markets, including IPO activity and financial market sophistication
  • Taxation, including incentives for entrepreneurs and the ease of filing
  • Investor protections and corporate governance, including legal protections
  • Human and social environment, including education, labor regulations and corruption measures
  • Entrepreneurial opportunities, including indicators of innovation, corporate R&D, and the ease of starting, running and closing a business.

To achieve a high ranking on the VC/PE Country Attractiveness Index, a country must score well on all six key drivers.

The index was designed and elaborated by IESE’s Center for International Finance, working in conjunction with EMLYON Business School. The team includes IESE’s Heinrich Liechtenstein, EMLYON’s Alexander Groh, Karsten Lieser and Markus Biesinger.

Trend-Spotting Over Five Years

In the uppermost echelon of the rankings, relative stability reigns. Comparing 2015 results to those of five reports ago (the 2011 report), the United Kingdom climbed two spots to second place, switching places with Singapore, which dropped two spots to land at fourth. The United Kingdom has benefitted from improving entrepreneurial opportunities and GDP growth prospects, while Singapore has seen growth prospects dampen and tighter competition within Asia.

The index creators prefer to highlight five-year shifts to see the more important trends. They caution against reading too much into year-to-year changes, which may stem from short-term volatility.

They also note that private-equity investors will often set their sights on emerging regions, in search of new transactions with satisfying risk/reward ratios. Among the BRICS (Brazil, Russia, India, China and South Africa), China — ranked 21st this year — stands out for its economic growth, capital markets development, and favorable taxation practices for entrepreneurs. That said, China has remained relatively stable in the rankings, climbing just one spot in five years.

Meanwhile, the biggest gains within the top 20 over the past five years belong to New Zealand — climbing from 15th to ninth place — and Malaysia — climbing from 18th to 12th. Farther down the list, the Philippines jumped an impressive 22 spots, from 64th in 2011 to 42nd in 2015. The Philippines scores particularly well on the economic indicators, with impressive growth projections going forward.

In the bad news column, Cyprus stands out for its 28-spot drop in the index over the past five years. Now ranked 65th overall, the crisis-hit Mediterranean island is the ranked dead last (120th) for its ratio of non-performing bank loans to total gross loans. Growth prospects also look bleak.

Heat Map

To help track region trends, the index is accompanied by a heat map. On the map, North America and Europe appear largely green, reflecting their attractiveness to investors, while Africa appears largely red, indicating its markets are still developing. Within Africa, South Africa and Morocco score highest, coming in at 37th and 50th, respectively. South Africa slipped five spots over five years while Morocco has gained six, with particular strides seen in Morocco’s quality of corporate governance and security of property rights.

Seeing the long view is key to private equity investors, who might wait several years for an investment to bear fruit. To help provide this view, the index is accompanied by an interactive website to view five-year-trends and regional shifts.

Going forward, IESE and EMLYON plan to continue expanding the index’s scope, while maintaining comparability. Looking back to 2006, when the project was first initiated at IESE with a Europe-only pilot, progress is obvious.

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Two Members Of ETA Terrorist Organization Arrested In France

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At a private address on the night of July 7, as part of Joint Operation “Tonel/Tonneau”, the Spanish Guardia Civil and the French General Directorate for Internal Security (DGSI) arrested two members of the terrorist group ETA, who were on the run from the Spanish justice system and among the most wanted by both the Spanish and French police forces.

According to the Spanish government, arrested were Xabier Goyenechea Iragorri, born in San Sebastián, aged 35, and Joseba Iñaki Reta de Frutos, born in Elorrio (Biscay), aged 56.

The Spanish government said that the two men arrested played an important role within the terrorist group ETA as they were in charge of the techno-logistical department of the terrorist gang.

On July 20, 2014, the websites of the “Gara” and Naiz.info” newspapers published a communiqué from ETA in which the terrorist group announced it was carrying out an internal restructuring process which provided for the decommissioning of its “logistics-military” framework, the creation of a “techno-logistical” structure, responsible for sealing its arms caches, and strengthening its “political system”, without this leading to the abolishment of its structures necessary for internal operations.

Up until the time of his arrest, Xabier Goyenechea Iragorri was ultimately responsible for this system, with support in terms of management and coordination from the second individual arrested during the operation, according to the Spanish government.

The Spanish government said that the two men are members of ETA and have extensive experience in activities supporting the terrorist group, adding that Xabier Goyenechea was one of the organizers and catalysts behind the so-called ‘street fighting’ in Rentería (Guipuzcoa) and had taken part in various acts of violence and sabotage. For this reason, and to escape a police operation, he went into hiding in April 2008.

Xabier Goyenechea was also involved in the theft of six top of the range cars by numerous members of ETA in March 2010 from the “Auto Contac” dealership in the French town of Dammarie Les-Lyes (60 kilometres from Paris), which ended in the killing of French police officer Jean-Serge Nérin – the first member of the French police force to be killed by ETA, the Spanish government said.

Joseba Iñaki Reta joined the terrorist group ETA in 1978 and, as leader of the MUGARRA ‘legal unit’ [a unit comprising members who do not have police records], took part in various terrorist actions over the course of 1981. Since then, he has been sentenced for his collaboration with and membership of an armed or terrorist gang, most recently in September 2008, when he went into hiding.

The ongoing nature of the terrorist activity by Joseba Iñaki Reta has been demonstrated by the discovery of several of his fingerprints among the abundant ETA material seized by the Spanish Guardia Civil in January 2010 in the town of Bermillo de Sayago (Zamora), which two members of the terrorist gang were trying to relocate to Óbidos (Portugal), a town where ETA was installing an explosive device storage facility and manufacturing workshop. This facility was dismantled by the Portuguese Guardia Nacional Republicana (GNR) in February 2010.

Furthermore, Xabier Goyenechea and Joseba Iñaki Reta were the leaders of the ERREKA ‘legal unit’ dismantled by the Spanish Guardia Civil in Guipuzcoa in 2011, leading to the largest seizure of explosive material from ETA in Spain. The two men arrested are the subject of various arrest warrants issued by several Central Courts of Instruction of the Spanish National High Court, the Spanish government said.

Two French citizens were also arrested as part of this operation (J.F.M. and M.T.L.) for providing accommodation to the two terrorists in a property owned by them in Ossés.

This joint operation between the Spanish Guardia Civil and the French DGSI represents the first police action against one of the youngest structures of the terrorist group ETA – the techno-logistical department – and the arrest of its leaders – two of the most wanted members of ETA – is especially significant.

This outstanding police action carried out within the framework of international police cooperation represents a hard blow to ETA, and will make controlling and managing the material it still has extremely difficult. Operation “Tonel-Tonneau” forms part of the investigations being carried out by the Spanish Guardia Civil into the clandestine structures of the terrorist group ETA and represents another important step towards their definitive dismantling.

The operation remains active and further arrests have not been ruled out.

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US Judge Orders Release Of Guantánamo Force-Feeding Tapes, Condemns Government Delays – OpEd

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Sick of delaying tactics, a US federal court judge has ordered the government to stop wasting time with “frivolous” appeals against her rulings, and to release videotapes showing a Guantánamo prisoner being brutally force-fed.

On October 3 last year, in the District Court in Washington D.C., Judge Gladys Kessler ordered the government to prepare for public release 32 videotapes of a Guantánamo prisoner, Abu Wa’el Dhiab, being dragged from his cell and force-fed. The tapes contained 11 hours of footage in total, and, as I explained at the time, Judge Kessler responded to the government’s concerns about the need for anonymity for US personnel by ordering them to be “redacted for ‘all identifiers of individuals’ other than Mr. Dhiab.”

That was over nine months ago, and on Friday (July 10), Judge Kessler ordered the government to “complete all national security-related redactions to the first eight tapes — which show Abu Wa’el Dhiab being forcibly removed from his cell and tube-fed — by August 31, and to complete other key redactions by September 30,” as Mr. Dhiab’s lawyers at Reprieve explained in a press release.

Reprieve added, “The tapes were first filed to court as classified evidence in a legal challenge to prison conditions at Guantánamo Bay, Dhiab v Obama. 16 press organizations, including [the] Associated Press, the Washington Post and the New York Times, intervened seeking the videos’ release to the public on First Amendment grounds. Judge Kessler ordered them to be released; the Obama Administration then appealed in what Judge Kessler called ‘as frivolous an appeal as I’ve ever seen.’”

A month ago, a panel of three appeals court judges turned down that appeal, and in a hearing on Thursday (July 9), Judge Kessler made clear her frustration with what Reprieve called the government’s “protracted delaying tactics” in the case. Not only is it over nine months since Judge Kessler’s order, but it is over a year since the 16 media organizations first sought the public release of the videotapes, and two years since Dhiab — who was finally freed from Guantánamo and resettled in Uruguay in Decemberfirst sought to have restrictions imposed on the authorities’ claimed right to force-feed him as they wished, without any outside scrutiny. He has stated that he was subjected to force-feeding about 1,300 times during his imprisonment.

As Reprieve explained, in court on Thursday, lawyers for the Justice Department “made two main points, which found little favor with Judge Kessler.” Firstly, after nine months, they had the nerve to ask the court “to reconsider its prior order to release the videotapes,” and secondly they “claimed it would take several more months for the Obama Administration to redact any tapes,” contradicting the government’s “previous assessment that they would need five weeks to redact all 32 tapes.”

When Andrew Warden of the Justice Department “began asserting that it would take until the end of August to prepare even 8 of 32 tapes,” Judge Kessler “interjected very swiftly,” and stated, “No, that’s not how we are going to it. The Government has made it possible to delay this for, according to my count, eight and a half months. Eight and a half months. The Government’s appeal was as frivolous an appeal as I have ever seen. Of course the Court of Appeals didn’t have jurisdiction. The minute I heard you were going to go up [to the Court of Appeals] I remember then talking to my law clerk saying, ‘I don’t understand this, the case is still on my docket. The Court of Appeals doesn’t have jurisdiction now.’ But that’s neither here nor there.”

Making clear that “she was not going to tolerate excessive further delay on the part of the Justice Department,” Judge Kessler added, “We are going to move as fast as we can.”

The Intercept reported that the following exchanges had taken place in the courtroom. David Schulz, attorney for the media organizations, said of the government’s proposed timetable, “This whole thing is a ploy. It’s delay, delay, delay.”

Eric Lewis, counsel for Mr. Dhiab, was “incredulous,” as The Intercept put it. “Last year, they could do 32 tapes in five weeks,” he said. “This year, they can do 8 tapes in seven weeks.”

The Intercept added that the government’s response was to pin the delay “on the Pentagon’s video editors, and claiming that the process has ‘proven to be much more burdensome and time-consuming.’” Andrew Warden told the court, “This is a very difficult project that is to some degree unprecedented,” adding, “there are real practical and technological burdens with the redaction process.” He explained, “There are 30 frames per second, and the video editors have to go frame by frame to redact names, faces and other personally-identifiable information.

Dhiab’s attorney “responded with skepticism,” as The Intercept put it. Eric Lewis said, “Video editors do that all the time. It’s a matter of commitment and resources.” As a compromise, Eric Lewis suggested, “rather than putting all 32 tapes through editing, which will be painfully time-consuming based on the government’s track record thus far, that only an hour-and-a-half long compilation video go through the redaction process and be released to the public.” Lewis said, “We’re looking for a way to break though this and make up for a great deal of lost time.”

Prior to the ruling, Cori Crider, Mr. Dhiab’s attorney at Reprieve, said, “The Defense Department has been playing stall ball from the second we forced them to turn over this grisly secret footage, and they remain determined to keep every second of it out of the hands of the US media. Their motive is obvious: if Americans were permitted to see the truth in these tapes, the conversation about Guantánamo would change overnight.”

Afterwards, she said, “This is a great win for the US press, and for the First Amendment. The Obama Administration has been kicking and screaming to avoid processing even one minute of this footage, and never wanted to have to give a specific reason for keeping it secret. That is because the real reason for trying to hide Mr. Dhiab’s face is that what he suffered is a scandal and an embarrassment to the Administration that allowed it.

She added, “The Government has been rightly chided by the judge and now will be made to give real reasons for every frame of this footage that they want to keep hidden from the public. Images of a suffering detainee are matters of public importance and should no more be suppressed than those of Abu Ghraib, Eric Garner or Rodney King. An Administration truly committed to transparency would release the tapes forthwith. That’s why the US press is intervening in this case, and the courts are standing firm to preserve our right to see what is being done in our name.”

I wrote this article for the “Close Guantánamo” website, which I established in January 2012 with US attorney Tom Wilner. Please join us — just an email address is required to be counted amongst those opposed to the ongoing existence of Guantánamo, and to receive updates of our activities by email.

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Nuland On Crisis Visits To Kosovo, Macedonia

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By Una Hajdari and Sinisa Jakov Marusic

The US Assistant Secretary of State for European and Eurasian Affairs, Victoria Nuland, is due in Kosovo and Macedonia – on a mission to push for the formation special war crimes court in Kosovo and break the political stalemate in Macedonia.

On her visit to Kosovo on Sunday, Nuland is expected to try to persuade MPs to back unpopular constitutional changes that will allow for the establishment of a special court to handle war crimes committed by the Kosovo Liberation Army, KLA, in the 199os conflict.

Nuland will meet President Atifete Jahjaga, Prime Minister Isa Mustafa and Foreign Minister Hashim Thaçi.

Thaci has for months been pushing for the ratification of the amendments, but in the last vote, held two weeks ago, even members of his own Democratic Party of Kosovo voted against it, calling it an “unfair smear of the just struggle for liberation” by Kosovo Albanians.

Former members of the KLA, a guerilla force that took on Serbian paramilitaries and the Yugoslav army during the late 1990s, could now be tried for crimes committed against civilians during and after the conflict.

According to media reports, the government is likely to resubmit the draft amendments to the assembly following Nuland’s visit.

While in Kosovo, Nuland will also discuss the Kosovo-Serbia dialogue and progress on implementation of the April 19, 2013 Brussels Agreement on normalization of relations, the US State Department said.

On Monday, Nuland is expected to head for Macedonia, where a political crisis revolves around a massive illegal surveillance scandal centred on Prime Minister Nikola Gruevski.

Nuland’s visit to Macedonia comes after the opposition said EU and US-brokered talks with the government had failed and a deal on early elections was therefore void. The opposition has accused Prime Minister Gruevski of avoiding talks.

Nuland’s scheduled meeting with Gruevski and opposition chief Zoran Zaev is seen as a chance to revive the talks and enable a deal to be reached on a transitional government.

The coalition of opposition parties led by the Social Democrats on Thursday expressed support for Zaev’s decision to halt further negotiations and for his view that the Prime Minister had broken the June 2 agreement on early elections.

The ruling VMRO DPNNE party on the other hand says it will not accept a new Prime Minister leading a transitional government until the snap elections.

As the Macedonia crisis talks hit dead end, the International Crisis Group, a think tank, said the scandal over leaked wiretaps had revealed “a state apparatus captured and corrupted by the leading party”.

The ICG said the EU should “redouble efforts” to persuade Macedonian leaders to reach a deal that would envisage the formation of an “interim government with appropriate membership of all main parties, whose main task should be to implement reforms necessary for credible elections by April 2016”.

The main reforms needed before elections “are those related to voter lists, equal media access and abuse of office for partisan purposes” the ICG wrote.

Nuland’s visit is part of a regional tour that also includes visits to Croatia, Bosnia and Herzegovina, Montenegro, Albania and Serbia.

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Modest Proposal To Help ASEAN Reconcile Overlapping Claims In Spratlys – OpEd

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By Michael McDevitt*

Because the multiple Spratly sovereignty claims largely overlap, attempting to unscramble these claims is generally considered too difficult. What follows is one way ASEAN claimants – the Philippines, Vietnam, Malaysia, and Brunei – could reconcile their competing claims in the Spratly Islands.

The reason for doing so is simple. It would set a positive example for subsequent resolution with China. It would also make it easier for ASEAN to speak with one voice to China regarding a resolution of overlapping claims, and would create a useful precedent for other maritime disputes in East Asia. It might also make it easier for each country to begin to exploit resources in their Exclusive Economic Zones (EEZ).

The following is how such an approach might unfold.

The least complicated of the overlapping Spratly claims are those between the Philippines and Malaysia. Reconciling these overlapping claims:

  • Manila would renounce its claim to islands, rocks, and low tide elevations (LTE) that Malaysia currently controls, and vice versa. In practice, this would mean: the Philippines would renounce its claim to rocks named Eric, Investigator, and Marvelles Reefs and to the low tide LTE Ardasier Reef, which Malaysia controls, while Malaysia would renounce its claim to the Commodore Reef/Rizal Reef, which the Philippines controls.
  • Then, Malaysia would reconcile its claims with Vietnam:
  • To make any claims reconciliation scheme work, Hanoi would have to take the essential step of compromising its claim to all of the Spratlys. Clearly, this would be difficult because of worries about setting a precedent that China might exploit. Hanoi would also need a compelling public rationale to avoid a nationalist outburst like that which that took place when the Chinese National Offshore Oil Company (CNOOC) drilling rig began operations in the contested waters where Vietnam’s and China’s EEZs overlap. Such a rationale might argue that reconciliation with other ASEAN governments would strengthen its position in the Spratlys legally and militarily, as well as in the court of world opinion.
    Another enticement could prod Hanoi to participate in the reconciliation process: a 1998 legal precedent suggests that its claim to all the Spratlys might not be upheld by an arbitral panel. Specifically:
  • The arbitration between Eritrea and Yemen is the case most analogous to the Spratlys. In that case sovereignty over the many islands in the Red Sea between the opposite coasts of Eritrea and Yemen was in dispute. The Tribunal found that the evidence did not support Yemen’s claim of natural or physical unity for the entire island chain in dispute. Rather the Tribunal analyzed the evidence that applied to each of the six groups of islands and divided sovereignty over the groups between Eritrea and Yemen.

Third, if Hanoi agrees to the reconciliation process, then:

  • Vietnam would renounce any claim to Brunei’s only claimed Spratly feature: the LTE Louisa Reef.
  • Malaysia would renounce its claim to Amboyna Cay and Banque Canada Reef, which Vietnam currently occupies.
  • Vietnam would renounce its claim to the features Eric, Investigator, and Marvelles Reefs and the LTE Ardasier Reef, which Malaysia already controls.
  • These two steps would solve the claims overlap between Malaysia, Brunei, and Vietnam.

Fourth, the Philippines would have to reconcile its claims with Vietnam:

  • Manila would renounce its claim in favor of Vietnam to Thitu Island (the second largest Spratly), Northeast Cay, and Loaita Island. In the process, Manila would also abandon its claim to the section of the Spratlys enclosed in its dotted-line box surrounding what it calls the Kalayaan Island Group (KIG), and disestablish that political entity (it was annexed in 1978). Obviously this would be very difficult for Manila, despite the fact that its claim has little or no legal credibility. This action would recognize the reality that the Philippines is never likely to attempt to force Vietnam, China, or Taiwan off the 18 features that those countries already occupy in the KIG, as well as the fact the features it currently occupies are essentially indefensible.

Finally, Vietnam would renounce its claim in favor of the Philippines to four features that Manila can credibly claim based on a principle of first discovery and effective occupation: West York, Nanshan, Flat Islands, and Lankiam Cay. Vietnam would probably argue that these small islands were covered by its original claim, but they are not clearly identified in the original French annexation document and there is little or no historical evidence to support continued activity to reassert sovereignty.

This action would complete the reconciliation of claims among ASEAN claimants. They would also have to recognize that LTEs and totally submerged features, such as Reed Bank or James Shoal, that are on the recognized continental shelf of one of them belong to that coastal state.

This approach comes close to the suggestion made by a number of observers that the best way to solve the Spratly dispute would be to resort to the well-established legal principle of uti possidetis, which means that in absence of agreement to the contrary, everybody is entitled to keep what they have. While the process suggested above is not a perfect example of this principle – because it leaves both China and Taiwan out of the process – among ASEAN claimants it comes close.

Finally the ASEAN participants would need to come to some agreement over what features they would consider an island, as defined by UNCLOS, and which features they would collectively agree are rocks. Because of the proximity of many of these features, 200-nm EEZs drawn from features that claimants assert are islands would overlap one another, and would overlap the EEZ drawn from the coastal base-line of each state. Reconciling EEZs is necessary to remove any ambiguity over ownership of resources.

The biggest problem with this proposal is China. What would Beijing do once it learned what was afoot, particularly since the Philippine-Vietnam facet of the deal would greatly strengthen Vietnam’s position in the Spratlys? The features that the Philippines would cede to Vietnam would be the 2nd, 5th, and 10th largest of the 13 largest naturally formed features in the Spratlys. Would this action trigger China’s use of force, seizing features before Vietnam could take possession?

In fact, given the very difficult compromises that Hanoi and Manila would have to make in giving up portions of their claims, plus the uncertainty surrounding Beijing’s reaction, this modest proposal will likely never take place. It does, however, highlight the devilishly difficult problem of eliminating the Spratlys as a potential East Asian flashpoint.

*RADM (ret) McDevitt, a long time commentator on US policy and security matters in East Asia, is a senior fellow at CNA Corporation, a not for profit research center in Arlington, Virginia

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Defusing The Bombs In Macedonia – Analysis

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Macedonia is reeling from two shocks. Amid a scandal over leaked wiretaps revealing a state apparatus captured and corrupted by the leading party, a battle in ethnically mixed Kumanovo between police and ethnic-Albanian gunmen, many from Kosovo, caused the region’s worst loss of life in a decade. Unless addressed urgently, the double crisis (government legitimacy/regional security) carries risk that could extend to violent confrontation, perhaps in worst case to elements of the conflict narrowly averted in 2001. Discredited national institutions cannot cope alone.

The opposition has broken off talks on a European Union (EU) mediated deal between parties for reforms and early elections that deadlocked, substantially over whether the prime minister, in power since 2006, must resign and the time a transitional government would need to level the field. The EU must press for a comprehensive agreement addressing the state capture and alleged corruption, including independent investigation and monitoring with international help. Macedonia and Kosovo, also with aid, should jointly investigate Kumanovo.

In February 2015, the main opposition party began publishing excerpts from what it said was an illegal wiretap program leaked by unidentified persons. The massive surveillance, from at least 2010 to 2014, seems to have targeted thousands, including nearly all top opposition and government officials, as well as ambassadors and media figures. The fraction of published wiretaps focus on what appear to be conversations of senior government persons plotting to subvert elections, manipulating courts, controlling a nominally independent press and punishing enemies. Many who should be responsible for dealing with apparent illegalities are themselves implicated.

In the midst of this crisis, a police raid in Kumanovo on 9 May found a heavily armed group of ethnic Albanians, including former liberation army fighters from Kosovo. By the time fighting died down the next day, a multi-ethnic neighbourhood was destroyed, eight police were dead and 37 wounded; ten gunmen were dead and about 30 in custody. Top Macedonian and Kosovo officials had advance knowl­edge of at least some of the group’s activities, but much remains worryingly obscure, including its plans in Macedonia, possible allies on both sides of the border and many details of the police operation.

The incident did not spark ethnic conflict. Ethnic Albanians, roughly a quarter of the population, deeply resent what they perceive to be their second-class status and unequal treatment in a state dominated by ethnic Macedonians. They had expected more from the 2001 Ohrid Framework Agreement (OFA) that ended the incipient civil war and was meant to give them a power-sharing role in a unitary state. For now, there is little constituency for fighting. While the inter-ethnic peace has proven resilient, however, further wiretap releases or a new deadly incident could raise the risk quotient unpredictably.

Macedonia appeared for a time to be building a modern, transparent state and integrating its ethnic-Albanian community, but that progress has ceased, even reversed, at least since a 2008 Greek veto resulting from the two countries’ eccentric dispute over the republic’s name blocked the prospect of EU and NATO integration indefinitely. The wiretaps, which appear to illustrate that governing parties have entrenched their power and privileges through corruption and criminality, have also dramatically compromised the ruling coalition’s ethnic-Albanian partner. Prime Minister Nikola Gruevski, who has denied any wrongdoing, and opposition leader Zoran Zaev are playing high-stakes poker at the EU-sponsored talks, while some of the tens of thousands of activists who held duelling political rallies in the centre of Skopje in May remain encamped outside government and parliament buildings.

The EU, which has a direct stake in the threat to regional stability and a responsibility to assist a country right itself to which it has granted membership candidacy status, should redouble efforts to persuade Macedonia’s leaders to restore trust in government by reaching an inter-party agreement that commits to:

  • establishing through normal parliamentary procedures an interim government with appropriate membership of all main parties, whose main task should be to implement reforms necessary for credible elections by April 2016 (two years early), especially those related to voter lists, equal media access and abuse of office for partisan purposes;
  • adopting a law in parliament establishing two independent commissions (“A” and “B”), both with authority to request and receive active expert help from the EU, U.S. and others. The mandate of “A” should be to assist with and monitor the transitional government’s efforts with respect to preparing credible early elections; The mandate of “B” should be to deal with the wiretaps, including investigation into the crimes and corruption they appear to show;
  • accepting that the transitional government will remain in office and early elections will not be held unless Commission “A” determines that benchmarks have been met, and implementation is sufficiently advanced; and
  • working to improve implementation of the OFA by ensuring equal representation of ethnic Albanians at all levels of public office; a fair share of government investment in ethnic-Albanian areas; and respect for language equality.

The inter-party agreement should further commit Macedonia’s leaders to:

  • seek a joint Macedonia-Kosovo investigation into the Kumanovo incident, with expert assistance from EU and U.S. agencies, in order to improve the security situation and prevent future attacks; and
  • improve bilateral relations with Kosovo, for example by holding regular joint cabinet meetings and cooperating on border monitoring.

Full report can be found here

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US Condemns Al Shabaab Attacks In Mogadishu

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The US on Sunday strongly condemned yesterday’s al-Shabaab’s terrorist attacks against the Siyad Hotel, Weheliye Hotel, and an African Union Mission to Somalia (AMISOM) position in Mogadishu.

*We extend our deepest condolences to the families and loved ones of the soldiers, government officials, and civilians killed in the attack, and our regrets to the many who were injured,” said John Kirby, US State Department Spokesperson in statement.

According to Kirby, the US praises the Somali and AMISOM forces for their response to this attack, which was conducted just as residents were breaking their Ramadan fast.

“Through these murders, al-Shabaab once again has demonstrated its brutality and its complete rejection of a Somali society free of violence and oppression,” said Kirby, adding that, “The United States remains committed to working with the Somali people, their government, and international partners to continue forward in progress, prosperity and stability.”

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West Now Resolved To Confront Moscow On Ukraine And Moscow Is Frightened, Illarionov Says – OpEd

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After 15 months of uncertainty, the West has resolved to stand up to Moscow on Ukraine and demand a return to the status quo ante before relations between the West and Russia can be restored, according to Andrey Illarionov. And that resolve, he says, has “seriously upset” the Kremlin.

This represents “a qualitative shift,” the Russian analyst told the Gordon news agency yesterday, one in which during the last two months, “the West have given the Kremlin to understand the following: ‘You want a confrontation with us? You’ve got it!’” (gordonua.com/publications/Illarionov-Vpervye-za-15-mesyacev-Zapad-dal-ponyat-Kremlyu-Hoteli-konfrontacii-s-nami-Poluchite-Kreml-serezno-ispugalsya-89080.html).

Illarionov says that the shift in the West’s position began at Brisbane and was sealed by the declaration of Chancellor Angela Merkel in Moscow on May 10 when she referred to Crimea and insisted that Russia’s “illegal occupation” be ended, that the peninsula be returned to Ukrainian control, and that Russian aggression elsewhere in Ukraine be stopped and reversed.

From February 2014 to that point, he continues, that is “almost a year and three months, not a single Western leader made reference to Crimea in such a context.” Consequently, there was an implicit suggestion that “if Putin stops military actions in the East of Ukraine, the West either de jure or de facto would agree that the peninsula would remain under the control of the Russian Federation for the foreseeable future.”

Please note, Illarionov says, “Crimea was not mentioned orally or in writing in one document signed as a result of negotiations in Geneva in April 2014, in Normandy in June 2014, or in Minsk in September 2014 or February 2015.” Now, it has been, and that shows how far the West’s position has shifted and hardened.

According to the Russian analyst, “an important role” in this shift was played by three reports on Russian forces in Ukraine: Boris Nemtstov’s “Putin. War” (putin-itogi.ru/putin-voina/), the Atlantic Council’s “Hiding in Plain Sight: Putin’s War in Ukraine (atlanticcouncil.org/publications/reports/hiding-in-plain-sight-putin-s-war-in-ukraine-and-boris-nemtsov-s-putin-war), and the Ukrainian intelligence service study, “Russian Aggression Against Ukraine” (cdn3.videos.bloomberg.com/bview/documents/russian-aggression-against-ukraine.pdf).

The sea change in the West has been marked not only by Merkel’s words but also by NATO’s actions and “what is most important,” changes “in the opinion of the political elites of the West.” For a long time, “the West slept, having convinced itself that Putin’s aggression against Ukraine was a mistake, an accident, or ‘Putin’s emotional outburst’ that it would disappear with time.”

Indeed, there appeared to be “a serious danger,” Illarionov says, that the West would continue to occupy “approximately the same position it did in the Russian-Georgian war of 2008 when three months after the Kremlin’s aggression against Georgia, the West continued relations with the Russian Federation in the style of business as usual.”

But instead, the West has adopted a tough line and is demanding as the price of restoring normal relations “the restoration of the status quo before February 2014” when Russian forces began their attacks on Ukrainian institutions in Crimea and ultimately occupied the Ukrainian peninsula while beginning their attacks on Ukraine’s southeast as well.

“The Kremlin is seriously frightened,” Illarionov says. It didn’t expect this show of toughness, and it is sending signals that it doesn’t want because it cannot sustain confrontation with the West. “Putin has said that Russia has not pans for an attack on NATO countries, including the Baltic countries,” he points out.

And in words even the Kremlin’s opponents would be unlikely to use, Sergey Ivanov, head of the Presidential Administration and a possible Putin successor, compared NATO’s forces with Russia’s as those of “a behemoth and a house cat.” Given that, Moscow isn’t going to attack: “Are we suicidal?” he asked rhetorically.

Ivanov’s words were a clear signal to the West. They appeared only in the English-language version of “The Financial Times” but not in the Russian version.” In this way, Illarionov says, “the Kremlin send the West a clear message: we do not intend to fight with you; we are frightened, and we do not want that. Please stop your military preparations.”

Illarionov even opened the door to the possibility that there will be an international tribunal on the shooting down of the Malaysian airline in July 2014. The Netherlands and Malaysia have called for one, although the Russian Foreign Ministry has denounced such calls as “untimely and counterproductive.”

Whether such a tribunal will be convened depends on the attitudes of Western governments. “If they support it,” he says, “such a tribunal will take place independent of the opinion of the Russian Federation. The details depend on the degree to which the West will maintain that line of behavior which it has chosen over the last two months.”

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Driving Policies Through Fraud And Fear-Mongering – OpEd

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A physician offers sanity-based perspectives on EPA’s “Data Derangement Syndrome”

Propaganda tactics employed by the Environmental Protection and its activist allies increasingly employ emotion as a primary media tool. Mothers and children pose on the US Capitol steps, waving signs that claim they are fighting for clean air and their children’s health. Images of these “lovable lobbyists” for EPA’s Clean Power Plan and other rules are intentionally heart-tugging.

It is maternal instinct versus scientific facts; emotions versus informed debate. If EPA issues dire warnings, that is all these moms need to hear. Indeed, it is hard to overcome such pleadings with cold facts alone.

The well-orchestrated “do something” demonstrations enable politicians and agencies to devise and implement new legislation and regulations. It is much like physicians who succumb to patients’ “do something” demands by prescribing antibiotics for common colds. It is a useless, if not dangerous practice.

The public’s general fear of anything labeled a chemical, or requiring some comfort with numbers, is a powerful psychological tool for alarmists. In-the-street TV interviews showing fearful reactions to di-hydrogen monoxide represent but one example. The scary-sounding chemical, of course, is H2O: ordinary water.

If the air is hazy, even from natural sources like pine trees, many people automatically assume it is injurious to their health, even if the “pollution” levels are perfectly safe. The dose makes the poison. It’s even worse for invisible toxins. The linear no-threshold mindset now governs virtually all government toxicology programs.

The attitude assumes there is no safe limit. Any and all substances in any amount may be injurious to health, until proven otherwise. Forgone possible health or economic benefits from the demonized substances are not considered. Economist Julian Simon coined the term “false bad news” to describe how activists, regulators and the media make innocuous substances sound harmful, when they target something and set-out to ban it.

These crusaders ignore impartial and even convincing scientific rebuttals, since they specialize in publicizing bad news and perpetuating their own prejudiced agendas. Hollywood celebrities and politicians have become pseudo-authoritative fonts of pseudo-scientific knowledge for the media-obsessed public. Actors should be the least believable, as they make a career by pretending to be what they are not and regurgitating words written for them by others. But somehow they become star experts. Many career politicians are little better.

EPA reports that the six major Clean Air Act pollutants have declined some 62% on average. Meanwhile, reported asthma incidence has risen from 8.9% in 2005 to 9.4% in 2010. How can that be? EPA blames air pollution. But more likely factors include increased public awareness and reporting; expanding the agency’s asthma definition to include all reactive airway diseases; and blunted development of natural immunity, as children exercise less and play less outdoors, in environments that may now be too clean to challenge and bolster developing immune systems.

EPA’s guiding principles seem to be “never let a hypothetical disease go to waste” and “look for data that prove the assumption” (but ignore all unsupportive data). A favorite new bogeyman is what EPA calls PM2.5 (particulate matter or soot 2.5 microns or smaller in diameter). Pollutants like this are appropriately categorized under the rubric of DDS: “Designer Disease Syndrome” or “Data Derangement Syndrome.”

PM2.5 is a most peculiar disease-causing agent, compared to traditional agents. Its pathophysiologic mechanism is undefined, even by EPA. It includes multiple substances whose only common characteristic is that they are really tiny: human hair is 16 to 48 times wider than 2.5 microns. However, they must pose a substantial health threat because EPA says they do – even though the particles have no unique chemical composition, arise from both natural and manmade activities, and vary in composition from one geographic location to another and over different periods of time.

EPA claims inhaling PM2.5 can cause death, including sudden death and long-term death (which the agency calls “premature deaths”). But what level is healthy or safe, and by whose and what criteria? Former EPA Administrator Lisa Jackson must have known, since she told Congress in 2011: “If we could reduce particulate matter to healthy levels, it would have the same impact as finding a cure for cancer in our country.”

Her claim has no scientific basis, and underscores EPA’s growing credibility problem. The agency claims PM2.5 particles cause death. However, epidemiological studies provide no direct evidence of definitive causation, or even validated explanations for the biological mechanisms allegedly causing death.

EPA claims “epidemiological studies … have found consistent, precise positive associations between short-term exposure to PM2.5 and cardiovascular mortality … at short lags (0-1 days).” Do we really face a zero to one-day timeframe? Is EPA predicting near-instant deaths? Even if so-called precise positive associations exist – and EPA has not shown that they actually do – how does this demonstrate cause-and-effect relationships?

Even EPA’s epidemiological tests on human subjects do not show such relationships. Volunteers were told PM2.5 is associated with health risks and death. However, EPA had conducted “297 controlled human exposures” to PM2.5, while encountering only “one clinically significant event” – and even that study participant experienced “no harm or injury.” Some tests even involved pollution levels close to what a person might encounter in “a typical urban center in America on a smoggy day,” also with no problems.

Valid, useful experimental designs must define what animal species, human test subjects and dose sizes are involved. Were all possible confounding factors identified and accounted for? Were these valid, random population samples – or biased selections? Were the computers programmed to find the sought-for correlations? We do not know. But we do know that weak statistical correlations are being presented as proof of cause-and-effect. We do know that EPA is a master at trolling data banks to find needle-in-the-haystack clinical correlations that can be used to predict “dire risks” and project “deep concerns” to mothers.

EPA has conducted controlled human exposure studies to air pollutants for more than thirty years, at the University of North Carolina. During that time, more than six-thousand volunteers were studied, without a single serious adverse event.

The Harvard Six Cities Study (Laden et al 2006) provides a key scientific basis for EPA claims regarding supposed PM toxicology. Yet examination of the data shows that the statistical “relative risk” (RR) for total mortality claims ranges from below one to barely above one and a fraction. That does not meet the minimum legal standard of a RR of at least 2 to identify a significant population risk.

Even worse, the Harvard study teams have walled-off their raw clinical data from independent investigators, by claiming patient confidentiality, thereby preventing verification of results by other experts. Independent reproducibility and verification of test results are the traditional (and essential) hallmarks of scientific research. Invoking patient confidentiality to block access to raw data casts doubt on the entire process, especially since providing adequate patient confidentiality is rather easy to do.

So is there a health problem to investigate, or not? How much more testing do we need to demonstrate an actual problem? It looks more like a disease concept in search of a susceptible victim.

Representative Lamar Smith (R-TX) has led the congressional effort to make governmental agencies provide open disclosure of data and analyses used to formulate policy. The Secret Science Reform Act of 2015 (H.R. 1030) is designed to ensure such ethical behavior. Public funds support most such research, which is used to justify costly rules. We have a right to expect that our funds are used in an open and ethical manner.

EPA claims PM2.5 mortality begins at just 35µg/m3. Then why are airport smokers and the Shanghai population not dropping dead on the spot? Airport smoker lounges have ambient levels of 600 to 10,000µg of PM2.5 per cubic meter. A single draw on a cigarette floods a smoker’s lungs with 10,000µg to 40,000µg. The Shanghai press reports PM outdoor levels of 600µg/m3 – and says average life expectancy there is 82.5 years – greater than in any major US city. Where are our overflowing emergency rooms and mortuaries?

EPA’s chosen path has been to fabricate a PM2.5 disease entity, endow it with a unique pathological profile, fund scientific reviewers who support its claims, and present as proof of serious health impacts the favorable published reviews it paid for – while ignoring contrary findings by other scientists. Post-modern medicine has fused with post-modern pseudo-science. This perverse combination does not justify expensive regulations that kill jobs and impair people’s health and welfare.

*Charles G. Battig, MD is a physician in Charlottesville, VA: www.Climateis.com. This article is based on his presentation at the Heartland Institute’s 2015 International Conference on Climate Change.

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Syria Energy Profile: Oil And Gas Production Down On Civil War – Analysis

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Syria’s energy sector is in turmoil because of the ongoing civil conflict that began in the spring of 2011, with oil and natural gas production declining dramatically since then.

Syria’s energy sector has encountered a number of challenges as a result of conflict and subsequent sanctions imposed by the United States and the European Union. Damage to energy infrastructure—including oil and natural gas pipelines and electricity transmission networks—hindered the exploration, development, production, and transport of the country’s energy resources.

Syria, previously the eastern Mediterranean’s leading oil and natural gas producer, has seen its production fall to a fraction of pre-conflict levels. Syria is no longer able to export oil, and as a result, government revenues from the energy sector have fallen significantly. Prior to the current conflict, when Syria produced 383,000 barrels per day (b/d) of oil and 316 million cubic feet per day (Mmcf/d) of natural gas, Syria’s oil and gas sector accounted for approximately one fourth of government revenues.

Syria faces major challenges in supplying fuel oil to its citizens. Electricity service in much of the country is sporadic as a result of fighting between government, opposition forces and the Islamic State of Iraq and Syria (ISIS). Further, the exploration and development of the country’s oil and natural gas resources have been delayed indefinitely. Nevertheless, even if the fighting were to subside, it would take years for the Syrian domestic energy system to return to pre-conflict operating status.

Syria summary energy statistics
Oil
Proved reserves, 2015 (million barrels) Petroleum and other liquids supply, 2014 (thousand b/d) Petroleum and other liquids consumption, 2013 (thousand b/d)
2,500 33 224
Natural gas
Proved reserves, 2015 (billion cubic feet) Dry natural gas production, 2013 (billion cubic feet) Dry natural gas consumption, 2013 (billion cubic feet)
8,500 187 200
Electricity
Generating capacity, 2012 (gigawatts) Electricity generation, 2012 (billion kilowatthours) Electricity consumption, 2012 (billion kilowatthours)
8.9 29.5 25.7
Source: U.S. Energy Information Administration, Oil & Gas Journal

Sector organization

In 1964, Syria passed legislation that limited licenses for exploration and investment to the Syrian government. The Ministry of Petroleum and Mineral Resources oversees the Syrian oil and natural gas sectors, and is in charge of setting policy priorities and coordinating the efforts of the state-led companies that operate in the sector. The following information reflects the pre-conflict operating status of Syria’s oil and natural gas sector.

The General Petroleum Company (GPC) oversaw the strategies for exploration, development, and investment in Syria’s oil and gas sector, and supervised the activities of its many affiliated companies, including the Syrian Petroleum Company (SPC) and the Syrian Gas Company (SGC). The SPC was Syria’s largest state-owned oil company, and it had a number of production-sharing agreements (PSAs) in place throughout the oil sector. Most of the country’s PSAs were split equally between the SPC and its partners. These arrangements often ensured that the Syrian government retained a certain percentage of the oil produced in its fields as royalties. Contracts regularly lasted up to 25 years.

The SPC operated through several subsidiaries, the most notable being the Al-Furat Petroleum Company (AFPC), which was a joint venture between the SPC, Royal Dutch Shell, the Chinese National Petroleum Company (CNPC), and India’s Oil and Natural Gas Corporation (ONGC). Other SPC subsidiaries included the Deir Ez-zor Petroleum Company, the Syria-Sino Alkawkab Oil Company, the Hayan Petroleum Company, the Oudeh Petroleum Company, and the Dijla Petroleum Company. International oil companies with interests in Syria prior to the conflict included Gulfsands, Sinopec, and Total, as well as several other smaller companies. By most accounts, nearly all of Syria’s foreign partners have left the country.

The General Organization for Refining and Distribution of Petroleum Products (GORDPP) managed the country’s downstream portfolio for oil and natural gas. It also oversaw the operations of the Banias Refinery Company and the Homs Refinery Company, among other duties. Other important state entities overseen by the GORDPP included the Syrian Company for Oil Transport (SCOT, which operated the country’s pipelines), Mahrukat (which dealt with refined products), and Sytrol (the state marketer of petroleum products).

The Syrian Gas Company (SGC)—which fell under the GPC—was the key entity in Syria’s upstream natural gas operations, a position it inherited after being split off from the SPC in 2003. Syria’s natural gas distribution network was managed by the SCOT. The majority of Syria’s gas-processing plants were operated by state-owned firms—led by the SPC—but there were a handful that were operated by international companies.

The Ministry of Electricity oversaw the electricity sector in Syria, while the General Establishment for Electricity Transmission operated the country’s transmission system. Syria also had separate entities for the generation and distribution of electricity.

Petroleum and other liquids

Syria flows of petroleum and other liquids

Syria flows of petroleum and other liquids

Syria’s oil sector has been in a state of disarray since 2011. Production and exports of crude oil have fallen to nearly zero, and the country is facing supply shortages of refined products.

The Oil & Gas Journal estimated Syria’s proved reserves of oil at 2.5 billion barrels as of January 1, 2015, a total larger than each of Syria’s neighbors except for Iraq.1 Most of Syria’s crude oil is heavy (low gravity) and sour (high sulfur content), which requires a specific configuration of refineries to process. Sanctions placed on Syria by the European Union in particular—whose countries accounted for the majority of Syrian oil exports previously—limited the number of markets available to import and process the heavier Syrian crudes. The loss of oil export capabilities severely limited Syrian government revenues, particularly the lost access to European markets, which in 2011 imported over $3 billion worth of oil from Syria, according to the European Commission.2 Prior to sanctions, European refineries were the target market for Syrian oil because they were configured to process heavy, sour oil.

Since the swift advance of ISIS in 2014, Syrian oil production has essentially ceased. The lack of domestic crude oil production has caused the country’s two main refineries to operate at less than half of normal capacity, resulting in supply shortages for refined petroleum products. Further, sanctions—and the resulting loss of oil export revenues—make importing petroleum products difficult. It is likely that Iran continues to supply Syria with crude oil and refined products.3 Oil theft is also a problem, with Syrian officials claiming that hundreds of barrels of crude oil are being stolen and shipped to neighboring countries each day.

Exploration and production

Syria crude oil condensates

Syria crude oil condensates

Syria’s oil production, which averaged over 400,000 b/d between 2008 and 2010, was less than 25,000 b/d in May 2015.

With the onset of sanctions by the United States, the European Union, and other countries, almost all of the international oil companies (IOCs) and national oil companies (NOCs) ceased operations in Syria, significantly limiting Syria’s exploration and production capabilities. Most of Syria’s existing oil fields are located in the east near the border with Iraq or in the center of the country, east of the city of Homs. Possession of Syria’s largest producing fields including the Deir-ez-Zour region—which includes Syria’s largest field, Omar—has fallen to ISIS.4 The exact level of current production from these fields is unknown, but U.S.-led airstrikes have certainly caused structural damage in the region and have limited its output.

Syria’s average oil production from 2008—10 was stable at approximately 400,000 b/d, but since the combined disruptions of military conflict and economic sanctions began, the country’s production dropped dramatically. The latest U.S. Energy Information Administration (EIA) estimates indicate that Syrian crude oil and condensates production has fallen to barely 25,000 b/d—including production outside the control of the Syrian government. This level is a drop of roughly 90% since the conflict began in March 2011.

The years prior to the onset of hostilities saw an increased emphasis on the use of enhanced oil recovery (EOR) techniques in Syria, with several companies promising increased investment in the country’s mature oil fields. The AFPC utilized water- and gas-injection systems to aid recovery in many of its fields, and—with little in the way of new discoveries expected—EOR techniques are likely to become increasingly important for ensuring stable output should production resume.

Syria also has shale oil resources, with estimates of reserves in 2010 ranging as high as 50 billion tons according to Syrian government sources.5 The Syrian government delayed a bidding round for the country’s shale resources—scheduled for November 2011—because of the political situation in the country.

Imports and exports

Syria’s crude oil exports are assumed to have ceased, and the country is having difficulties importing refined petroleum products.

In the years leading up to 2011, Syria began importing more refined petroleum products to meet rising domestic demand. In 2010, the country imported an average of 105,000 b/d of refined petroleum products, and exported just 36,000 b/d. At the time, Syria was also exporting more than 150,000 b/d of crude oil, but the country’s crude exports are now effectively zero. Following the imposition of sanctions and the advancement of ISIS, Syria has experienced a shortage of crude oil and petroleum products. Iran continues to supply Syria with approximately 60,000 b/d of crude oil, but this level is still insufficient to meet demand.6

Syria has three export terminals on the Mediterranean Sea, all operated by the Syrian Company for Oil Transport (SCOT) under the GORDPP. Syria has two crude oil export blends, Syrian Light and Syrian Heavy (also known as Souedieh).

Refining and consumption

The combined capacity of Syria’s two refineries has fallen to roughly half its pre-conflict output.

Syria has two state-owned refineries, one in Homs and the other in Banias. The combined nameplate capacity of the two refineries at the beginning of 2015 was slightly less than 240,000 b/d according to the Oil & Gas Journal;7 a total capacity that met only three-fourths of Syria’s pre-conflict demand for refined products. With damage to pipelines and other infrastructure around the refinery at Homs in particular, Syrian officials claim that the country’s actual refining capacity now is closer to 50% of its pre-war nameplate capacity.8 Several proposed refineries are now on hold or canceled altogether, such as the proposed 100,000 bbl/d facility at Abu Khashab backed by the CNPC, which was canceled because of the security situation in the country.

Natural gas

Syria natural gas flows

Syria natural gas flows

Syria’s natural gas sector has not been affected quite as severely by the ongoing conflict as its oil sector, although dry natural gas production is down by at least 40% compared with pre—conflict totals.

The Oil & Gas Journal reported that Syria held proved reserves of 8.5 trillion cubic feet (Tcf) of natural gas as of January 2015. Like the country’s oil fields, the majority of Syria’s natural gas fields are in the central and eastern parts of the country. Most of Syria’s natural gas is used by commercial and residential customers and in power generation. Syria also uses its natural gas in oil—recovery efforts, with approximately 20% of daily gross production reinjected into the country’s oil fields between 2004 and 2013.

In 2008, Syria became a net importer of natural gas, but the country’s current state of conflict—and sanctions—have affected the ability of Syria to receive natural gas. The only source of natural gas imports, the Arab Gas Pipeline, became the target of attacks as the conflict intensified, forcing the pipeline to shut down. Syria’s plans to convert all existing thermal power generation facilities to natural gas—fired plants (many are currently using refined petroleum products) hinge on these import volumes being available, but this goal seems out of reach.

Exploration and production

Arab Gas Pipeline  U.S. Energy Information Administration, IHS Representation of international boundaries is not necessarily authoritative

Arab Gas Pipeline
U.S. Energy Information Administration, IHS
Representation of international boundaries is not necessarily authoritative

Syria’s dry natural gas production fell to less than 200 billion cubic feet (Bcf) in 2013 according to estimates from EIA.

In 2010, the last year under normal operating conditions, Syria produced 316 billion cubic feet (Bcf) of dry natural gas. By 2012, that figure dropped by 28% to about 227 Bcf, and EIA estimates that production was 187 Bcf in 2013. Prior to the current conflict, more than half of Syria’s natural gas production came from nonassociated fields, with those volumes being redirected to oil fields and domestic demand centers through the country’s domestic pipeline network. In 2012, 25% of Syrian natural gas production was reinjected into the country’s oil fields to aid in oil recovery, a slight increase from the 2002—11 average of nearly 19%. According to Syrian government officials, in 2013 more than 90% of the country’s natural gas production was used by the country’s power sector.

Imports and exports

According to press reports, Syria is not currently importing natural gas from Egypt via the Arab Gas Pipeline.

Syria has never produced sufficient volumes of natural gas to export. Prior to the recent conflict, Syria imported a small amount of natural gas from Egypt to supplement its own domestic production, but production volumes dropped by more than 60% between 2010 and 2011 (from 24.4 Bcf to 8.8 Bcf, according to Cedigaz data) and stopped in 2012. Those imports came via the Arab Gas Pipeline, which started operating in 2008 and sends Egyptian gas into Syria (near Homs) via Jordan. There were plans to expand the pipeline into Turkey, Lebanon, and eventually to Europe, but developments are now unlikely.

Electricity

Middle East electricity consumption

Middle East electricity consumption

Syria’s electricity infrastructure, including power plants, substations, and transmission lines, has been a frequent target of sabotage.

In 2010, Syria generated almost 44 billion kilowatthours of electricity, 94% of which came from conventional thermal power plants. The remaining 6% came from hydroelectric power plants. Refined petroleum products and natural gas fuel Syria’s thermal generating facilities. Syria plans to convert all of its thermal generation facilities to run on natural gas as soon as possible, although this is unlikely until hostilities end. Syria’s lack of domestic refining capacity, the ongoing sanctions on the country’s energy sector, and declining natural gas production combine to limit the availability of the necessary fuel for Syria’s electric plants and have contributed to blackouts in many parts of the country.

By early 2013, more than 30 of Syria’s power stations were inactive, and at least 40% of the country’s high voltage lines had been attacked, according to Syria’s Minister of Electricity. Syria’s electricity generating capacity was 8.9 gigawatts in 2012, although damage to electricity generating facilities, high voltage power lines, and other infrastructure has likely reduced the country’s effective capacity. Electricity distribution losses, already 17% of total generation in 2012, have likely climbed even further.

Prior to the current conflict, the Syrian government hoped to emphasize the importance of renewable energy and laid out plans to develop renewable energy sources in the country. The 11th Five-Year Plan for 2011—2015 made that goal clear; however, there will be no progress in the near term.

Syria, along with Egypt, Iraq, Jordan, Libya, Lebanon, the Palestinian Territories, and Turkey, is a member of the Eight Country Interconnection Project, but the current state of Syria’s electricity sector leaves the future of the project—within Syria—in doubt. In 2012, Syria reduced its imports of electricity from neighboring Egypt, Jordan, and Turkey, opting to pursue an arrangement with Iran instead. That agreement would connect 250 megawatts of transmission capacity from Iran to Syria, and came after the announcement that Syria had suspended purchasing electricity from Turkey. Iran agreed to provide Syria with a $1 billion credit facility in mid-2013, with half of the total earmarked for electric power projects.9

In September 2012, Syria’s Minister of Electricity announced plans to boost generating capacity by an additional 1.5 gigawatts over the next several years. However, as with most projects in the country, current conflict and lack of access to international capital makes such an undertaking impossible.

Notes:

  • Data presented in the text are the most recent available as of June 24, 2015.
  • Data are EIA estimates unless otherwise noted.

Sources:
1Oil & Gas Journal, Worldwide Look at Reserves and Production, January 1, 2015.
2European Commission, Trade in goods with Syria, April 2015, page 5.
3Middle East Economic Survey, “Damascus Cash Crunch as Crude Below 10,000 b/d”, volume 58, issue 18 (May 1, 2015).
4Middle East Economic Survey, “Syria’s Economic Woes Only Set to Intensify”, volume 58, issue 5 (January 30, 2015).
5International Business Times, “Syrian Oil and Gas: Little-known Facts on Syria’s Energy Resources and Russia’s Help”, September 4, 2013.
6Middle East Economic Survey, “Syria’s Economic Hardships Intensify with Fuel Shortage”, volume 58, issue 9 (February 27, 2015).
7Oil & Gas Journal, Worldwide Refining Survey, January 1, 2015.
8Middle East Economic Survey, “Damascus Cash Crunch as Crude Below 10,000 b/d”, volume 58, issue 18 (May 1, 2015).
9Reuters, “Iran grants Syria $3.6 billion credit facility to buy oil products”, July 31, 2013.

The post Syria Energy Profile: Oil And Gas Production Down On Civil War – Analysis appeared first on Eurasia Review.

The Hillary Enigma – OpEd

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Does it strike anyone as strange that the only candidate for the Democratic Party’s nomination to be the next President of the United States is the wife of a former President? There is no historic precedent for this, no way to measure this against how Americans have selected Presidents in the past.

Like most Americans, I first took notice of her when Bill began his campaign to become President. I recall being struck by the fact that in 1969 as a student at Wellesley College, her 92-page senior thesis was devoted to the community organizer, Saul Alinsky’s book. The title of the thesis was “There is Only the Fight…”: An Analysis of the Alinski Model.” She would request Wellesley to deny access to it.

Alinksy was a Communist. His twelve rules for radicals, unlike the Ten Commandments, are devoid of a moral message. Instead, the message is “this is how you can win.” Hillary would do well to review Rule 7, “A tactic that drags on too long becomes a drag.” She was already old news when she announced her candidacy and it is becoming older with every passing day as she fails to take questions from the media, participating in totally staged events to look like “one of the people.”

She and Bill are not one of the people. They, like the Bushes, are political royalty. They have both been around a very long time.

Hillary, however, despite the millions of words that have been written about and by her remains an enigma. Other than being farther to the Left than Bill, she is a woman whose “achievements” in life have largely been the result of having married Bill. She would spend eight years in the White House as the First Lady and, pursuing her college dreams of political power, they would move to New York State where she ran and won a Senatorial election.

There isn’t a single Senate bill that she introduced or that is credited to her. She is said to have worked hard and gotten along well with her colleagues, but her Senate years are a blur in her public life. Then she made a bid to be the Democratic Party’s presidential candidate in 2008 and along came Barack Hussein Obama with whom the voters fell in love. When he was elected, he asked her to become his Secretary of State.

With the exception of the Benghazi tragedy on September 11, 2012, a clear failure of judgment and duty, and about which she lied, her years as Secretary of State reflect her years in the Senate; nothing of any significance resulted, no major treaties, no major anything, except for one more scandal.

So the question remains; who is Hillary Rodham Clinton? What are her fundamental principles beyond the acquisition of political power? And money. Lots of it while uttering nonsense such as she and Bill being “dead broke” when they left office?

What are we to make of her deletions of thousands of emails on her private server—something she was not supposed to use as Secretary of State—and her assertion that those we may never see were of no importance? They’re important if, as is widely believed, foreign governments hacked her private email server and thus had access to information about policies affecting themselves and others. She may not have broken a law, but she surely did not obey Obama White House policy regarding the emails.

Alinski’s Rule 1 is “Power is not only what you have, but what the enemy thinks you have. Power is derived from two main sources—money and people.”

We are told that Hillary has a huge amount of money with which to wage a campaign to become the first woman President. In light of the revelations about the Clinton Foundations, virtual slush funds, and the millions earned by her and Bill to give speeches, there is little doubt of that.

You cannot, however, buy trust and the polls indicate that is seeping away.

Her die-hard supporters probably know as little about her as the rest of us, but it is their trust she is depending on right now. Should she actually receive the Democratic Party’s nomination, the distrust of independent voters, disaffected Democrats, and of course Republicans, will play a crucial role in who is elected in 2016. It is not likely to be Hillary Clinton.

It is not likely because, as we have already seen, she seems to have reached a point where her political abilities have grown tired and out-of-date. These are not the 1990s. A whole generation has been born since Bill was President.

Like her, the Democratic Party seems tired as well. Can you believe there is not another Democrat, a Governor or Senator who could emerge to represent the Party? How devoid of any real leadership has the Democratic Party become if the only candidate they can offer is a former First Lady? That has been her primary claim to fame despite the two offices she has held since the 1990s.

I suggest that Hillary ceases to be an enigma if you just think of the Wellesley student who thought the best topic for her senior thesis was the book by a dedicated Communist, Saul Alinsky.

The post The Hillary Enigma – OpEd appeared first on Eurasia Review.

Colombia Energy Profile: Increased Importance As Energy Producer – Analysis

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Colombia has seen a dramatic increase in oil, natural gas, and coal production since the implementation of a series of regulatory reforms in 2003.

In recent years, Colombia has increased its importance as an energy producer in the Western Hemisphere. Colombia is currently the third-largest oil producer in Latin America and is the seventh-largest crude exporter to the United States. Colombia is also the largest coal producer in South America. The enactment of a series of regulatory reforms to make the oil and natural gas sector more attractive to foreign investors led to an increase in Colombian production. The government implemented a partial privatization of state oil company Ecopetrol (formerly known as Empresa Colombiana de Petróleos S.A.) in an attempt to revive its upstream oil industry. However, after nearly a half-decade of relatively secure operations, attacks on oil and natural gas pipelines have increased, and disruptions to oil supply averaged about 45,000 barrels per day (bbl/d) in 2014. Expanded oil production will require discoveries of reserves and improvements to infrastructure safety.

The U.S. Energy Information Administration (EIA) estimates that Colombia consumed 1.545 quadrillion British thermal units (Btu) of energy in 2012. Oil consumption constituted 40%, followed by hydroelectricity, natural gas, and coal. The country relies on hydropower for the bulk of its electricity needs and uses very little coal domestically. Of the 94.2 million short tons (MMst) of coal produced, Colombia exported 87% in 2013. Natural gas consumption in Colombia has grown, rising by more than 54% in the past decade.

Oil

Colombia’s oil production has increased since 2007 because of increased exploration and development. New exploration and development were spurred by the regulatory reforms of 2003.

According to the Oil and Gas Journal (OGJ), Colombia had more than 2.4 billion barrels of proved crude oil reserves as of January 1, 2015.1 Although exploration continues and discoveries are announced, Colombian officials estimate that, at current reserve levels, the current oil reserves will last about seven years.2

Much of Colombia’s crude oil production occurs in the Andes foothills and in the eastern Amazonian jungles.3 Meta Department, in central Colombia, is also an important production area, predominately of heavy crude oil. The area’s Llanos basin contains the Rubiales oilfield, the largest producing oil field in the country.4

Sector organization

Ecopetrol, the national oil company of Colombia, formerly controlled the development of all hydrocarbon resources. However, Colombia decided reforms were needed as a result of declining reserves and production, and in 2003, President Álvaro Uribe enacted energy sector reforms. President Uribe moved administrative and regulatory responsibility for the country’s hydrocarbon resources from Ecopetrol into a new regulatory agency, Agencia Nacional de Hidrocarburos (ANH).5 In 2012, additional restructuring consolidated responsibility for upstream and downstream planning and oversight in the Ministry of Mines and Energy.6

Colombia’s government has taken measures to make the investment climate more attractive to foreign oil companies. Upstream sector initiatives give foreign oil companies the right to own 100% stakes in oil ventures and to compete with Ecopetrol.7 In addition, the government has sold shares of Ecopetrol to private investors, reducing its share to roughly 90%. According to the Colombian central bank, the oil sector received $4.9 billion in foreign direct investment (FDI) in 2013, accounting for 30% of total FDI in Colombia.8

In August 2014, ANH concluded a bid round of 90 exploration blocks that included both onshore and offshore blocks. About 20% of the available blocks are believed to contain shale or coalbed methane gas, but only one of these blocks received a bid. A total of 15 companies were awarded blocks.9

Exploration, production, and consumption

Colombia petroleum production and consumption

Colombia petroleum production and consumption

Colombia produced 1 million bbl/d of petroleum and other liquids in 2014, which includes crude oil, condensate, natural gas plant liquids, other liquids, and refinery processing gain. Colombia’s oil production has increased by an annual average of almost 10% since 2008, but growth has slowed in recent years, and production was relatively flat from 2013 to 2014. Colombia consumed 290,000 bbl/d in 2014, allowing the country to export most of its oil production.

Prior to 2008, Colombia’s oil production had been largely flat for many years, following a period of steady decline that started in 1999 when Colombia’s oil production peaked at 830,000 bbl/d. The principal causes of the fall in oil production were natural declines at existing oil fields and a lack of new reserve discoveries. However, a combination of changes to the regulatory framework led to higher levels of investment in the country by international oil companies.

As a result of these improvements, Colombia experienced rapid growth in oil production between 2008 and 2013. However, increased rebel attacks on oil infrastructure and a lower world oil price led to a leveling off of production in 2014. In the May 2015 edition of the Short-Term Energy Outlook, EIA projected that Colombian oil production will remain steady over the next two years, averaging 1 million bbl/d in 2015 and 2016.

The largest producing oil field in Colombia is the Rubiales heavy oil field, located in Meta department (state/region). Low levels of production began at Rubiales in the late 1980s, but increasing investment and the completion of a new pipeline allowed production rates to rise from 96,000 bbl/d in 2009 to 212,000 bbl/d by August 2013.10 Since 2013, however, production at Rubiales has fallen, reaching 163,000 bbl/d by December 2014.11 Other large oil fields include Castilla, Chichimene, and Quifa.12

Oil exports

The United States is the top destination for Colombia’s oil exports.

In 2014, the United States was Colombia’s top oil export destination, followed by China, Panama, and India. In that year, Colombia exported 294,000 bbl/d of crude oil to the United States. Crude oil exports to the United States have fallen more than 100,000 bbl/d since 2012 because of strong crude production growth in the United States. China expressed interest in financing new infrastructure projects in Colombia to facilitate the transport of oil to the Pacific coast for export. In May 2012, agreements were made for China Development Bank to finance a 600,000 bbl/d pipeline to transport Colombian and Venezuelan oil to the south Colombian Pacific coast starting in 2016.13

Pipelines

Colombia has seven major oil pipelines, five of which connect production fields to the Caribbean export terminal at Coveñas. These include the 520-mile Ocensa pipeline, which has the capacity to transport 590,000 bbl/d from the Cusiana/Cupiagua area; the 485-mile, 220,000 bbl/d-capacity Cano Limon pipeline; and the smaller Alto Magdalena (9,200 bbl/d) and Colombia Oil (15,000 bbl/d) pipelines, which were sold to Perenco by Petrobas in 2013.14 The Llanos Orientales pipeline (also known as ODL) came online in late 2009, linking the Rubiales field to the Ocensa pipeline, with a capacity of 340,000 bbl/d.15 The 190-mile Trasandino pipeline has a capacity of 85,000 bbl/d and transports crude from Colombia’s Orito field in the Putumayo basin to Colombia’s Pacific port at Tumaco.16

In November 2010, Ecopetrol announced that it would be partnering with an international consortium to develop the Oleoducto Bicentenario pipeline.17 This $4.2 billion project, currently under construction, will have a peak capacity of 450,000 bbl/d. The first phase (110,000 bbl/d) began operations in late 2013, transporting hydrocarbons from Araguaney to Banadia, where it connects to the Cano Limon pipeline. The Oleoducto Bicentenario will eventually connect to the export terminal in Coveñas.18

Pipelines and other energy infrastructure in Colombia are still the targets of attacks by anti-government guerrillas. Pipeline attacks declined significantly from 155 in 2005 to 31 in 2010 according to Colombia’s Ministry of Defense.19 Since 2010, however, the number of attacks has increased substantially, reaching 259 in 2013 and 141 in 2014.20 This rise in the number of attacks has led to significant increases in unplanned production disruptions in Colombia. EIA estimates Colombia averaged 45,000 bbl/d of unplanned production disruption in 2014, nearly a three-fold increase since 2012. After suffering several military setbacks in recent years, anti-government fighters may have increased attacks to strengthen their negotiating position as part of Colombia’s ongoing peace talks.21

Downstream

According to Oil & Gas Journal, Colombia had 290,850 bbl/d of crude oil refining capacity in 2014 at five refineries, owned by Ecopetrol, which are shown in Table 1.22 The 205,000 bbl/d Barrancabermeja-Santander facility and the 80,000 bbl/d Cartagena refinery possess most of the country’s crude distillation capacity.

Although Colombia is a net oil exporter, it must import some refined products, especially diesel fuel. As a result, Ecopetrol has begun efforts to expand refining capacity in the country. The expansion of the Cartagena refinery, scheduled to be completed in 2015, will more than double its current capacity to 165,000 bbl/d.23 Ecopetrol is also expanding the Barrancabermeja plant, which will increase its capacity to 300,000 bbl/d and improve the refinery’s ability to process heavier crude oils.24 The expansion, currently under construction, is expected to be completed in 2018.

Table 1. Refining capacity and expansion, Jan. 2015
Refinery Location (department) Current capacity (bbl/day) Capacity under construction (bbl/day)
Barrancabermeja Santander 205,000 95,000
Cartagena Bolivar 80,000 85,000
Apiay Meta 2,250
Tibu Norte de Santander 1,800
Orito Putumayor 1,800
Source: U.S. Energy Information Administration, Oil & Gas Journal

Natural gas

Colombia natural gas production and consumption

Colombia natural gas production and consumption

Colombia is self-sufficient in natural gas supply and recently began exporting to neighboring Venezuela.

Colombia had proved natural gas reserves of 6.4 trillion cubic feet (Tcf) as of January 2015. The bulk of Colombia’s natural gas reserves are located in the Llanos basin, although the Guajira basin accounts for most current production. Natural gas production, like oil production, has risen substantially in the past few years, because of increasing international investment in exploration and development.

Exploration and production

Colombia produced 360 billion cubic feet (Bcf) of dry natural gas in 2013 and consumed 269 Bcf. Of the country’s total gross natural gas production, about half was reinjected to aid in enhanced oil recovery. In 2007, natural gas production began to exceed consumption, allowing for exports.

Three companies—Ecopetrol, Equion Energia (a partnership between Ecopetrol and Talisman Energy), and Chevron—account for most of Colombia’s natural gas production.25 Ecopetrol operates the Cupiagua and Cupiagua Sur fields in the large Llanos Basin in eastern Colombia. Equion Energia, formed after Ecopetrol and Talisman Energy acquired BP’s Colombian assets in 2010, operates the Cusiana, Cusiana Norte, and Cupiagua Liria fields, also in the Llanos Basin.26 Chevron, in partnership with Ecopetrol, operates the Caribbean Chuchupa offshore field in the Guajira basin, the largest nonassociated natural gas field in the country.27 The company also operates the nearby onshore Ballena and Riohacha fields.28

The Colombian government published a decree in March 2011 outlining a plan to increase domestic natural gas production, including production from shale or coalbed methane gas fields. Policies aimed at increasing domestic natural gas consumption and exports, combined with increased demand from the power sector as a result of weather-related hydroelectric shortages, have made expanding natural gas production a priority for the government.

Pipelines

There are about 3,100 miles of natural gas pipelines in Colombia.29 Transportadora de Gas Internacional (TGI), a subsidiary of Grupo Energia de Bogota, is the largest operator of natural gas pipelines in Colombia, with a network of approximately 2,300 miles.30 TGI was formed after Grupo Energia de Bogota acquired the state-owned Empresa Colombiana de Gas (Ecogás) at auction in 2006.31

Colombia has three main lines that transport natural gas: the Ballena-Barrancabermeja, with a capacity of 260 million cubic feet per day (MMcf/d), links Chevron’s Ballena field on the northeast coast to Barrancabermeja in central Colombia;32 the Barrancabermeja-Nevia-Bogota line, which connects the Colombian capital to the transmission network; and the Mariquita-Cali line through the western Andean foothills.33

Export pipelineIn 2007, the Trans-Caribbean Gas Pipeline, also known as the Antonio Ricaurte pipeline, came online, linking fields in northeastern Colombia’s Guajira department with western Venezuela.34 Venezuela’s Petróleos de Venezuela S.A. (PdVSA) financed the $335 million pipeline. In November 2011, an agreement was signed to extend the Ricaute pipeline across Colombia to Panama and Ecuador. Although initial contracted volumes for export from Colombia ranged from 80-150 million cubic feet per day (MMcf/d), actual exports to Venezuela have often exceeded these levels because of rising Venezuelan demand for natural gas for power generation and reinjection. Exports through the pipeline, which reached levels of 250 MMcf/d, were halted in May of 2014 amidst fears that Colombia’s power supply, derived primarily from hydroelectric facilities, would be impacted by drought.35 Since then, Colombia has resumed exports, albeit at a lower level of approximately 50 MMcf/d.

Coalbed methane

Coalbed methane (CBM) is a gaseous hydrocarbon that occurs along with coal reserves. This source of natural gas is transported and used in the same way as natural gas found in shale or other deposits. CBM has the potential to increase Colombia’s proved natural gas reserves dramatically, to facilitate greater domestic production, and to allow additional natural gas exports to neighboring countries. Estimates of Colombia’s total potential coalbed methane resources range from 11 to 35 trillion cubic feet (Tcf); however, only some of those reserves may ultimately be economically recoverable.36

Coal

Colombia coal production and consumption

Colombia coal production and consumption

Colombia was the fifth-largest coal exporter in the world in 2013.

Colombia had 6,746 million short tons (MMst) of probable coal reserves (mostly bituminous coal) in 2013, the largest in South America, according to the BP Statistical Review of World Energy 2014.37 These deposits are concentrated in the Guajira peninsula bordering the Caribbean and in the Andean foothills. Most of Colombia’s coal production and export infrastructure is located on the Caribbean coast. Colombia’s coal is relatively clean-burning, with a sulfur content of less than 1%. The country exports most of its coal production and was the fifth-largest coal exporter in the world in 2012 after Indonesia, Australia, Russia, and the United States.

Production

Colombia produced 94.2 MMst of coal in 2013, while only consuming 7.4 MMst. Colombian coal production is exclusively carried out by private companies and has doubled since 2002.

Colombia coal exports

Colombia coal exports

The largest coal producer in Colombia is the Carbones del Cerrejon (Cerrejon) consortium, composed of Anglo-American, BHP Billiton, and Xstrata.38 The consortium operates the Cerrejon Zona Norte (CZN) project, the largest coal mine in Latin America and among the largest open-pit coal mines in the world. CZN is an integrated system connecting the mine, railroad, and a Caribbean coast export terminal.39

U.S.-based Drummond Company, the second-largest coal producer in Colombia, operates two mines near La Loma, in the Cesar Basin.40 In June 2011, Drummond entered into an 80%-20% partnership with Japan’s Itochu Corporation known as Drummond International, which now owns and operates its Colombia interests.41 Itochu’s initial investment of $1.5 billion enabled expansion construction of a new export facility, increasing Drummond’s export capacity to 60 MMst per year. The partnership aims to increase coal exports to Japan and other Asian countries.42

Exports

Preliminary customs data show that Colombia exported 96 MMst in 2014, mainly to Europe, other South American countries, and the United States.43 Coal exports are an important part of the Colombian economy. Coal was the country’s second-largest export after oil and petroleum products and represented 19% of export earnings in 2012. The United States and Colombia have an important trading relationship in this sector, and in 2014, Colombian coal represented 73% of U.S. coal imports, or 8.3 MMst.44

Electricity

In October 2014, Colombia had 15.5 gigawatts (GW) of installed electricity generation capacity, almost 70% derived from hydropower, according to the Unidad de Planeación Minero Energética (UPME), the federal special administrative unit responsible for the sustainable development of the mining and energy sectors of Colombia.45

In October 2013, Colombia generated 5.3 terawatt hours (TWh) of electricity. Of the electricity generated, hydroelectric plants provided 68%, natural gas accounted for 18%, coal accounted for 8%, oil accounted for less than 1%, and the remaining electricity was from other sources.46

Exports

Colombia is a net exporter of electricity. According to the UPME, Colombia exported a net total of 60.4 gigawatt hours (GWh) of electricity in September 2014.47 In 2013, most of Colombia’s exports were to Venezuela; however, in 2014, nearly all electricity exports were to Ecuador.48 In September 2014, Colombia imported 3.6 GWh of electricity from Ecuador.49

Notes:

  • Data presented in the text are the most recent available as of May 27, 2015.
  • Data are EIA estimates unless otherwise noted.

Endnotes:

1Oil & Gas Journal, Worldwide Reserves, December 1, 2014.
2Ministerio de Minas and Energia, Colombian oil reserves grew by 2.86% during the year 2013, Press Release: 987, May 5, 2014, http://www.minminas.gov.co/minminas/otroidioma.jsp?cargaHome=2&opcionCalendar=10&id_comunicado=987, Accessed March 3, 2015.
3Agencia Nacional de Hidrocarburos, Mapa de Tierras, December 29, 2014, Accessed March 3, 2015, http://www.anh.gov.co/Asignacion-de-areas/Paginas/Mapa-de-tierras.aspx.
4Agencia Nacional de Hidrocarburos, Produccion fiscalizada de crudo 2014, Accessed March 3, 2015, http://www.anh.gov.co/Operaciones-Regalias-y-Participaciones/Sistema-Integrado-de-Operaciones/Paginas/Estadisticas-de-Produccion.aspx.
5Ministerio de Minas and Energia, Decreto Numero 1760 de 26 Junio de 2003, Accessed March 3, 2015,
http://www.minminas.gov.co/documents/10180/655199/Decreto-1760-26Junio2003.pdf/10da619c-aafa-421f-bcc9-865a5d1e011f.
6Ministerio de Minas and Energia, Ministry Responsibilities, http://www.minminas.gov.co/web/ingles/responsibilities, Accessed March 3, 2015.
7Viscidi, Lisa, Colombia’s Energy Renaissance, Americas Society and Council of the Americas, December 2010.
8Colombia Reports, Accessed April 3, 2015, http://colombiareports.co/colombia-fdi-statistics.
9Deloitte, Colombia 2014 Licensing Round preliminary results and second call for offers, August 2014, Accessed March 3, 2015, http://www.psg.deloitte.com/NewsLicensingRounds_CO_140818.asp.
10Pacific Rubiales, Investor Presentation, November 2009, November 2009; Agencia Nacional de Hidrocarburos, Produccion fiscalizada de crudo 2013, Accessed March 3, 2015, http://www.anh.gov.co/Operaciones-Regalias-y-Participaciones/Sistema-Integrado-de-Operaciones/Paginas/Estadisticas-de-Produccion.aspx. 11Agencia Nacional de Hidrocarburos, Produccion fiscalizada de crudo 2014, Accessed March 3, 2015,
http://www.anh.gov.co/Operaciones-Regalias-y-Participaciones/Sistema-Integrado-de-Operaciones/Paginas/Estadisticas-de-Produccion.aspx.
12Agencia Nacional de Hidrocarburos, Produccion fiscalizada de crudo 2014, Accessed March 3, 2015, http://www.anh.gov.co/Operaciones-Regalias-y-Participaciones/Sistema-Integrado-de-Operaciones/Paginas/Estadisticas-de-Produccion.aspx
13Hall, Simon, Colombia, China Strike Oil Deals. Wall Street Journal, May 9, 2012, http://www.wsj.com/articles/SB10001424052702304203604577394022580435862.
14Darby Private Equity, Darby closes $385 million acquisition of a stake in Ocensa, Colombia’s largest oil pipeline, Darby Private Equity Press Release, April 1, 2014,
http://www.darbyoverseas.com/darby/index.jsp?url=/press/press_releases/release_2014-04-01. Accessed March 3, 2015; Murphy, Peter and Luis Jaime Acosta,  Ecopetrol’s Cano Limon oil pipeline in Colombia shut after attacks, Reuters, November 28, 2014, Accessed March 3, 2015,
http://www.reuters.com/article/2014/11/28/ecopetrol-pipeline-idUSL2N0TI0ZY20141128; Reuters, Petrobras sells Colombian pipelines, blocks to Perenco for $380 mln. September 13, 2013, http://www.reuters.com/article/2013/09/13/petrobras-colombia-idUSL2N0H91SD20130913, Accessed March 3, 2015.
15Pacific Rubiales Energy, Information for Media, March 14, 2012, http://pacificrubiales.mediaroom.com/download/43-folleto_periodistas_EN.pdf, Accessed March 3, 2015.
16Acosta, Luis Jaime and Peter Murphy, Colombia’s Trasandino oil pipeline shut by rebel bomb attack, Reuters, December 17, 2014, http://ca.reuters.com/article/topNews/idCAKBN0JW02J20141218, Accessed March 3, 2015.
17Velez, Patricia and Marco Aquino, Colombiana Ecopetrol definiria esta semana socio para oleoducto, Reuters, November 10, 2010, http://lta.reuters.com/article/idLTASIE6A913720101110, Accessed March 3, 2015.
18Delgado, Diana, Colombia’s Bicentenario pipeline to startup in late 2015, Argus Media, April 24, 2013, As reproduced in Oleoducto Bicentenario press release, http://bicentenario.com.co/news.php?idnews=62, Accessed March 3, 2015.
19Ministerio de Defensa Nacional, Logros de la Politica Integral de Seguridad y Defensa para la Prosperidad, December 2014, http://www.mindefensa.gov.co/irj/go/km/docs/Mindefensa/Documentos/descargas/estudios%20sectoriales/info_estadistica/Logros_Sector_Defensa.pdf, Accessed March 4, 2015.
20Ministerio de Defensa Nacional, Logros de la Politica Integral de Seguridad y Defensa para la Prosperidad, December 2014, http://www.mindefensa.gov.co/irj/go/km/docs/Mindefensa/Documentos/descargas/estudios%20sectoriales/info_estadistica/Logros_Sector_Defensa.pdf, Accessed March 4, 2015.
21Beittel, June. Peace Talks in Colombia, Congressional Research Service, April 3, 2014.
22Oil & Gas Journal, 2014 Worldwide Refining Survey, December 1, 2014.
23Murphy, Peter, Ecopetrol’s Cartagena refinery to restart around May 2015, Reuters, April 3, 2014, http://www.reuters.com/article/2014/04/03/ecopetrol-colombia-refinery-idUSL1N0MV2BG20140403, Accessed March 4, 2015.
24Oil & Gas Journal, Ecopetrol’s Cartagena refinery revamp still under way,  April 30, 2014, http://www.ogj.com/articles/2014/04/ecopetrol-s-cartagena-refinery-revamp-still-under-way.html, Accessed March 4, 2015.
25Agencia Nacional de Hidrocarburos, Produccion fiscalizada-gravable de gas 2014, Accessed March 5, 2015, http://www.anh.gov.co/Operaciones-Regalias-y-Participaciones/Sistema-Integrado-de-Operaciones/Paginas/Estadisticas-de-Produccion.aspx.
26PRNewswire, Ecopetrol and Talisman Energy Finalize the Purchase of BP in Colombia and Announce Change of Company Name, January 24, 2011, http://www.prnewswire.com/news-releases/ecopetrol-and-talisman-energy-finalize-the-purchase-of-bp-in-colombia-and-announce-change-of-company-name-114509274.html, Accessed March 5, 2015; Agencia Nacional de Hidrocarburos, Produccion fiscalizada-gravable de gas 2014, Accessed March 5, 2015, http://www.anh.gov.co/Operaciones-Regalias-y-Participaciones/Sistema-Integrado-de-Operaciones/Paginas/Estadisticas-de-Produccion.aspx
27Agencia Nacional de Hidrocarburos, Produccion fiscalizada-gravable de gas 2014, Accessed March 5, 2015, http://www.anh.gov.co/Operaciones-Regalias-y-Participaciones/Sistema-Integrado-de-Operaciones/Paginas/Estadisticas-de-Produccion.aspx.
28Agencia Nacional de Hidrocarburos, Produccion fiscalizada-gravable de gas 2014, Accessed March 5, 2015, http://www.anh.gov.co/Operaciones-Regalias-y-Participaciones/Sistema-Integrado-de-Operaciones/Paginas/Estadisticas-de-Produccion.aspx.
29Central Intelligence Agency, The World Factbook, Accessed March 5, 2015, https://www.cia.gov/library/publications/the-world-factbook/fields/2117.html.
30Business Wire, Fitch: EEB Regains Full Control of TGI; Neutral to Ratings, April 8, 2014, http://www.businesswire.com/news/home/20140408006396/en/Fitch-EEB-Regains-Full-Control-TGI-Neutral#.VPib_UI9X7U, Accessed March 5, 2015.
31Camacho, Carlos, Fitch: EEB wins bid to buy Ecogas for US$1.43bn, BNAmericas, December 6, 2006, http://www.bnamericas.com/news/privatization/EEB_wins_bid_to_buy_Ecogas_for_US*1,43bn, Accessed March 5, 2015.
32Transportadora de Gas Internacional, Gasoducto Ballena-Barrancabermeja, http://www.tgi.com.co/index.php/es/nuestra-operacion/mapa-red-nacional-de-gasoductos/gasoducto-ballena-barrancabermeja, Accessed March 5, 2015.
33Transportadora de Gas Internacional, Mapa Red Nacional de Gasoductos, http://www.tgi.com.co/index.php/es/nuestra-operacion/mapa-red-nacional-de-gasoductos, Accessed March 5, 2015.
34MercoPress, Colombia gas-links with Venezuela and joins Bank of the South, October 12, 2007,http://en.mercopress.com/2007/10/12/colombia-gas-links-with-venezuela-and-joins-bank-of-the-south, Accessed April 28, 2015.
35Platts, Colombia to suspend natural gas exports to Venezuela next week, May 2, 2014, http://www.platts.com/latest-news/natural-gas/bogota/colombia-to-suspend-natural-gas-exports-to-venezuela-21569469, Accessed April 28, 2015.
36Guzman, Rudolfo, Potential Resources of Unconventional Hydrocarbons in Colombia, ANH Unconventional Hydrocarbons Workshop, June 8, 2011, http://www.anh.gov.co/Sala-de-Prensa/Presentaciones/Dr.%20Rodolfo%20Guzmán,%20Director,%20Arthur%20D’%20Little.pdf, Accessed March 5, 2015.
37BP Statistical Review of World Energy 2014, Accessed April 28, 2015, http://www.bp.com/en/global/corporate/about-bp/energy-economics/statistical-review-of-world-energy.html.
38Cerrejon, Neustra Empresa, http://www.cerrejon.com/site/nuestra-empresa.aspx, Accessed March 5, 2015; Cerrejon, Neustra Historia, http://www.cerrejon.com/site/nuestra-empresa/historia/nuestra-historia-2000.aspx, Accessed March 5, 2015.
39Cerrejon, Neustra Empresa, http://www.cerrejon.com/site/nuestra-empresa.aspx, Accessed March 5, 2015; Mining-Technology.com, The 10 biggest coal mines in the world, October 21, 2013, http://www.mining-technology.com/features/feature-the-10-biggest-coal-mines-in-the-world/, Accessed March 5, 2015.
40Drummond Ltd, Mines, www.drummondltd.com/our-operations/mines/?lang=en, Accessed March 5, 2015.
41Inoue, Yuko and Jackie Cowhig, Itochu-Drummond deal opens Asia to Colombian coal, Reuters, June 16, 2011, http://uk.reuters.com/article/2011/06/16/uk-coal-drummond-itochu-idUKTRE75F3MI20110616, Accessed March 5, 2015.
42Inoue, Yuko and Jackie Cowhig, Itochu-Drummond deal opens Asia to Colombian coal, Reuters, June 16, 2011, http://uk.reuters.com/article/2011/06/16/uk-coal-drummond-itochu-idUKTRE75F3MI20110616, Accessed March 5, 2015; Drummond Ltd, Timeline, http://www.drummondltd.com/about-us/timeline/?lang=en, Accessed March 5, 2015.
43Global Trade Atlas, Colombia Export Statistics, Coal (HTS 2701), Accessed March 6, 2015.
44U.S. Energy Information Administration, Quarterly Coal Report, Table 18, February 24, 2015.
45UPME, Plan de Expansion de Referencia Generacion – Transmision 2014-2028, http://www.upme.gov.co/Docs/Plan_Expansion/2015/Plan_GT_2014-2028.pdf, Accessed March 6, 2015.
46UPME, Plan de Expansion de Referencia Generacion – Transmision 2014-2028, http://www.upme.gov.co/Docs/Plan_Expansion/2015/Plan_GT_2014-2028.pdf, Accessed March 6, 2015.
47UPME, Plan de Expansion de Referencia Generacion – Transmision 2014-2028, Tabla 3-3,http://www.upme.gov.co/Docs/Plan_Expansion/2015/Plan_GT_2014-2028.pdf, Accessed March 6, 2015.
48UPME, Plan de Expansion de Referencia Generacion – Transmision 2014-2028, Grafica 3-10 and 3-11,http://www.upme.gov.co/Docs/Plan_Expansion/2015/Plan_GT_2014-2028.pdf, Accessed March 6, 2015.
49UPME, Plan de Expansion de Referencia Generacion – Transmision 2014-2028, Tabla 3-3,http://www.upme.gov.co/Docs/Plan_Expansion/2015/Plan_GT_2014-2028.pdf, Accessed March 6, 2015.

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UN’s Subversion Of International Law: Sri Lanka Story By Dharshan Weerasekera – OpEd

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A Sri Lankan attorney has attempted to put together a case study that depicts a very sinister move by the UN to subvert international laws and create precedents that would detrimentally affect other nations as well. Taking the reports of the UN Secretary General’s Panel of Experts, the Human Rights Council as well as the Human Rights Commissioners oral reports and recommendations, Dharshan Weerasekera shows that not only is there an illegality involved in the manner three resolutions led to a call for an international investigation but highlights how resolutions and reports that started out being about the last phase of the war ended up maligning Sri Lanka on a plethora of non-conflict related other matters that should have been dealt through the other UN systems in existence. Dharshan presents a solid case for a Sri Lankan citizen to pursue legal action against the UN, the UN Human Rights Council and the Human Rights Commissioner for the subversion of justice and international laws.

Dharshan Weerasekera’s first book ‘The UN’s Relentless Pursuit of Sri Lanka’ combined 3 essays on the resolutions of 2012,2013 and 2014 that appeared in the Foreign Policy Journal. The present book relooks at the 3 resolutions alongside the Panel of Expert Reports as well as the Sri Lankan Government’s own domestic mechanism the LLRC (Lessons Learned and Reconciliation Commission) and the National Action Plan.

The author takes the reader through the timeline of events starting out with how a 30 year conflict ended in May 2009. He also points out to the manner that rebel groups are often connected to foreign interests and funded and cites the case of ISIS. It is a known fact that while Tamil militants were initially trained by India in the 1970s the LTTE became a s urrogate of the West thereafter as seen by the manner Indian former PM Rajiv Gandhi was assassinated in India.

How is it then that immediately following the May 2009 defeat of the LTTE which led to a Germany-led Resolution at the UNHRC against Sri Lanka ultimately ended up with a counter-resolution favourable to Sri Lanka commending the nation for eliminating terrorism and wishing Sri Lanka for the daunting post-war challenges. This resolution confirms that LTTE kept hostages against their will and that the GOSL liberated tens of thousands of citizens kept by the LTTE.

How did commendations and well-wishe s by the UNHRC turn into successive resolutions calling for international investigations? Dharshan Weerasekera takes us to 23 May 2009 days after the conflict ended with the arrival of the UN Secretary General whose joint statement continues to be repeated as confirmation of agreement by the GOSL to conduct an international investigation. However citing the joint statement itself

“the Secretary General underlined the importance of an accountability process for addressing violations of international humanitarian law & human rights law, the GOSL will take measures to address those grievances”.

These lines do not show the GOSL agreeing to conduct any such domestic investigation.

However, obviously due to relentless pressures brought upon by Western governments, threats of cutting aid and other under hand tactics diplomatically used the GOSL consented to implementing in March 2010 the LLRC. However, in June 2010 the UNSG appoints a 3 member panel to appraise him of the last phase of Sri Lanka’s conflict.

What readers are required to take note of is that the POE appointed by the UNSG was outside the UN General Assembly and UN Security Council and was a panel appointed in his personal capacity of UNSG to appraise him. This then leads any to ask how such a pers onal appraisal led to become the foundation on which successive resolutions against Sri Lanka and became quoted by the UN Human Rights Commissioner herself in her 3 reports advocating an investigation against Sri Lanka.

Moreover, Dharshan Weerasekera also highlights that the POE was never officially tabled at the UNHRC officially giving Sri Lanka the right to defend itself.

Dharshan Weerasekera also shows that despite the March 2014 resolution advocating an international investigation in terms of vote while 23 members voted to authorize the investigation, 12 voted against and 12 abstained and the 12 abstentio ns cannot be taken as being favourable and these included India while the Pakistan ambassador reminded the Council that paragraph 10 of the resolution was inconsistent with the principles of the UN Charter and said that the resolution was about ‘politics’ and not human rights and that it was a ‘crass example of hypocrisy and double-standards’.

The book takes us through the argument that while the GOSL appointed the LLRC and from that took recommendations to draw up a National Action Plan, if the Human Rights Council or the High Commissioner knew of allegations that were not included into the LLRC what they should have rightly done was to give evidence of these allegations and officially requested the GOSL to look into them. Without presenting the allegations, giving the evidence for these allegations or from where they emerged the Council or the High Commissioner has no right to chide Sri Lanka and bring about resolutions accusing the GOSL for not looking into these ‘credible allegations’. When looking at the resolutions together, as advised by Dharshan Weerasekera, it reveals how Sri Lanka is being accused of not investigating credible allegations but not being told what these allegations are with evidence.

The author takes us back to the POE’s 5 charges: indiscriminate killing, shelling of hospitals, depriving civilians in the conflict-zone of humanitarian assistance, human rights violations suffered by victims and survivors of the conflict including IDPs and suspect LTTE cadres, human rights violations outside the conflict zone including against media and other critics (the last being totally outside the mandate)

The author highlights how POE in accusing the GOSL of not providing humanitarian assistance to civilians cites only the UN/WFP convoys taking 7435 metric tons of food and claiming that was insufficient for the civilians but purposely omits the parallel food convoys of ICRC/GOSL that transported 534,227 metric tons of food.

The author also takes us to the Panels sole source for alleging ‘executions’ against GOSL as being the Channel 4 videos which the POE presents alongside the report by Special Rapporteur Philip Alston whose report attaches 3 technical expert report one being from an American forensic analyst Jeff S Spivack who writes that ‘there is no way to confirm solely from the recordings the identity of the potential victims or the shooters. Neither whether the shooters were actually Sri Lankan military members as opposed to Tamils dressed in Sri Lankan military uniforms’. If so, as the author rightly questions why did the POE conclude that footage showed summary executions of prisoners by ‘Sri Lankan soldiers’. As the author rightly concludes these are serious credibility issues against the POE report.

The author next takes the reader to the LLRC which recommends investigation to see individual perpetrators (rank & file soldiers) can be prosecuted and punished and was not about incriminating the acts to a chain of command (Command Responsibility) and LLRC concludes that the ‘Security forces had not deliberately targeted the civilians in the NFZs’ and reconfirms that ‘offences of a few cannot be allowed to tarnish the honor of the many who upheld the finest traditions of service’. LLRC recommendations were to probe the 7 possible incidents of indiscriminate and/or deliberate killings plu s the C4 videos only to see if individual perpetrators could be prosecuted. LLRC also recommended to investigate incidents of shelling of hospitals and inadequacy of medical supplies to the conflict zone.

While these were the areas covered by both the LLRC and the POE, nevertheless the High Commissioner and the Councils reports have taken a whole new dimension to what should remain confined to the last phase of the conflict. The High Commissioner cites 2 cases mentioned in the POE – Trincomalee killing of 5 students, Action against Hunger. Col. Ramesh is mentioned under white flag, Issaipriya is mentioned in POE under C4 video.

However, she also brings out cases not mentioned in the POE – the name of Balachandran Prabakaran, How is it that Jeff Spivack the expert consulted by Philip Alston did not cover this?

While the author reiterates that the High Commissioners sole evidence for the allegation on white flag is a newspaper article only!

What the author argues is that the High Commissioner can only demand the GOSL to investigate what is recommended in the LLRC. The Council or the Commissioner cannot with each year add issues to reports and plug it to the POE or initial resolutions and indict the GOSL and charge Sri Lanka for war crimes as is being done. Paragraph 10 that the Pakistan Ambassador refers to says that the High Commissioners recommendations for ongoing violations are the immediate reason for the investigation’ but is there such a situation of ongoing violations to necessitate an international investigation? Moreover as the author rightly points out she did not initially quote ‘ongoing violations’ to require investigation why is she resorting to that argument now? All these show that in the absence of a prima facie case for an international investigation the High Commissioner and the Council are grasping at straws to validate the recommendation for an international investigation.

What readers are compelled to look at as advised by the author is that calls for the involvement of the Human Rights Council and to conduct investigations to ongoing violations of human rights laws are when there are situations that involve killing hundreds of people, causing immense property damage and as examples the author cites – Israel-Palestine /Congo /Darfur / Libya / Syria / Ivory Coast.

The author takes the examples cited by the High Commissioner

  • Former combatants & detainees – there is no allegations of wrong doing by the GOSL in its treatment of former combatants and detainees
  • Attacks on religious minorities/human rights defenders and freedom of opinion and expression – High Commissioner states violence by Sinhala Buddhist nationalist groups led by extremist Buddhist monks and cites as source a NGO called Secretariat for Muslims’ which is a ‘lobby’ for Muslims in Sri Lanka which means its reports and statistics are automatically biased. On one statistic, it is unfair for the High Commissioner to reach a conclusion against Sinhala Buddhists
  • Attack on human rights defenders – the High Commissioner says that her office continues to receive complaints of widespread harassment and intimidation. The author asks whether these have been submitted to the GOSL by her office or checked as to its credibility?
  • Attacks on freedom of speech and expression – author says that 3 attacks are mentioned 2 on the offices of a Tamil newspaper Uthayan and one on the Sunday Leader but no source is cited except for the High Commissioner views. There is also no contention that these attacks were to stifle freedom of expression
  • Extrajudicial, summary and arbitrary killings – the 2 incidents mentioned are Weliweriya and the Welikada prison. The sources given for the Weliweriya incident are Human Rights Watch and the Ministry of Defense Communique while the prison incident cites the NGO Centre for Policy Alternatives. The Army had appointed a court of inquiry to investigate the incident and 4 army officers were found guilty and relieved of duty. As for the Welikada incident a committee had been appointed which concluded that ‘the prisoners shot each other’.
  • Mass graves – 1st discovery in Nov 2012 near Matale with 155 skeletal remains / 2nd discovery in December 2013 in Mannar with 52 skeletal remains. The comments on these are solely the High Commissioners own comments and no sources are cited.

Thus in reading the manner in which the High Commissioner has presented arguments for ongoing violations and the lack of credible evidence it is easy to comprehend a sinister plan to unfairly accuse Sri Lanka and draw up a case for an international investigation without a prima facie case which the author concludes is illegal and a violation of Sri Lanka’s sovereign rights under the UN Charter.

As a response the author had initially advocated that Sri Lanka seek Advisory Opinion of the International Court of Justice – the UN’s official court. The author advises the UNHRC or the General Assembly to request an Advisory Opinion on the legality of the Sri Lankan investigation which Dharshan Weerasekera says would compel the court to look into the entire process through which the investigation was pushed through successive resolutions by a team of the same countries using diplomatic pressures. Even traditionally friendly nations that have backed Sri Lanka can seek on behalf of Sri Lanka such an Advisory Opinion for the precedent being set using Sri Lanka will affect other nations of the General Assembly and that is what the UN Membership must be concerned about.

The UN’s subversion of international law : the Sri Lanka Story by Attorney Dharshan Weerasekera is a 135 page book that includes all of the 3 Resolutions, the key points of the UN Secretary General’s Panel of Expert Report, the GOSL’s LLRC and National Action Plan, the oral and other reports filed by the High Commissioner and provides readers a refreshing argument in simple and easy to read language of the illegality of the resolutions and the international investigation being recommended and provides a solution as well – the possibility of taking legal action against the UN, the Human Rights Commissioner and the Human Rights Council.

The post UN’s Subversion Of International Law: Sri Lanka Story By Dharshan Weerasekera – OpEd appeared first on Eurasia Review.

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