Foreign Confidential ™
Foreign News and Analysis Since April 2005 -- formerly China Confidential -- What's Really Happening in the World
Saturday, May 12, 2012
Oil-Rich Iran Reports Big Gulf Gas Find
Iran's oil reserves are the third largest in the world at approximately 150 billion barrels--about 10% of the planet's total proven petroleum reserves. Iran is the world's fourth largest oil producer and OPEC's second-largest producer after Saudi Arabia.
Notwithstanding its incredible oil and gas resources, Iran is developing nuclear energy--at great economic and political costs.
What's wrong with this picture?
Friday, May 11, 2012
Ireland Could be Next to Resist Austerity
Referendum Could Kill EU Cost-Cutting Policy
Ireland is the only EU country that is putting austerity, which has not worked anywhere, to a national vote. A May 31 referendum asks citizens to approve an EU treaty that seeks to control member nations’ deficits and longer-term debts.
Critics of the pact, including Gerry Adams, head of Ireland's Sinn Fein party, the former political wing of the Irish Republican Army, say the cost-cutting measures fail to stimulate growth.
Read more.
Related: Greece Hurtles Towards New Elections
NYSE Amex Rebranded NYSE MKT
Another Name Change for a Storied Stock Exchange
NYSE MKT is a fully integrated trading venue within the NYSE Euronext community and the new name reinforces that fact," said Scott Cutler, EVP and Co-Head of U.S. Listings and Cash Execution at NYSE Euronext. "The venue is dedicated to growth-oriented companies in the U.S., and we continue to enhance the platform to best meet the needs of these clients."
NYSE Euronext bought the American Stock Exchange (Amex) in 2008 and renamed it NYSE Amex (after initially rebranding it NYSE Alternext).
Amex traced its origins to the curbstone brokers of the early 19th century, a group of non-New York Stock Exchange-member brokers who conducted their auctions in the street. After several years of outdoor trading, the curbstone brokers moved indoors in 1921 to a building on Greenwich Street in Lower Manhattan. In 1929, the New York Curb Market changed its name to the New York Curb Exchange. It quickly became the leading international stock market, listing more foreign issues than all other U.S. securities markets combined. In 1953, the Curb Exchange was renamed the American Stock Exchange.
Right up until its sale to NYSE Euronext, however, many Wall Street veterans still referred to Amex as "the Curb."
Disclosure: This reporter was CEO of an Amex-listed media company and, after its sale, senior public relations adviser to Amex, supporting the listing of overseas equities on the exchange until its acquisition by NYSE Euronext.
Radio Silence: Legendary Dutch Service Stops Broadcasting
Austerity Kills RNW, Which Kept Hope Alive in World War II
After six-and-a-half decades, Radio Netherlands Worldwide today ends its broadcasts aimed at Dutch people abroad. Read more.
Related: RNW Leaving Airwaves After 65 Years
Dutch Premier Wants Greece to Stick With Euro and Austerity
Cruel Joke? Lame Duck Rutte, Whose Cabinet Collapsed Over Austerity, Admonishes Greece as EU Forecasts Weak Dutch Economy Through 2013
The lame duck leader of one of Europe's weakest economies, Dutch Prime Minister Mark Rutte, whose own cabinet collapsed last month over EU austerity demands, told reporters Friday that the Netherlands wants Greece to remain within the euro zone and hopes that a new Greek government will be formed that will adopt policies to meet the European Union's budget criteria.
"Our policy is to keep Greece in the euro zone because we think it is better to have Greece in the euro zone than outside," Rutte said. "It is not the case that the euro zone falls apart without Greece."
In related news, The European Commission, which is the EU's executive body, said the Netherlands will be one of Europe's weakest economic performers in 2012 and 2013. Dutch gross domestic product will contract 0.9% in 2012 and the economy won't show any meaningful improvement until 2013, with just 0.7% growth, according to the Commission's forecast.
The report includes the Netherlands among Europe's weakest economies--Greece, Portugal, Italy and Spain.
Rutte resigned on April 23, two days after the PVV, which supported the government from the outside, withdrew its support. Populist PVV leader Geert Wilders refused to sanction the austerity measures the government sought, asserting the spending cuts would hurt economic growth.
Rutte's government lasted only 558 days, making it one of the country's shortest since World War II.
New elections are scheduled for September 12.
Copyright © 2012 Foreign Confidential™
N. Korea Continues Cyberwar on South
Nuclear-armed North Korea--the world's worst dictatorship--is continuing its cyberwar on South Korea, disrupting civilian air traffic and shipping. Read the full, updated report.
Related: S. Korean Politician Calls for Nuclear Deterrent Against North, Reintroduction of U.S. Tactical Nuclear Weapons
Related: S. Korean Politician Calls for Nuclear Deterrent Against North, Reintroduction of U.S. Tactical Nuclear Weapons
Germany Hardens Line on Greece
No compromise on austerity--Berlin's message. Read the full story. Germany says the eurozone can survive Greece's exit.
Related: Stalemate in Greece
Related: Stalemate in Greece
Thursday, May 10, 2012
Syrian Christians Still Support Assad
The Christian-Alawite alliance is still strong in Syria, where an uprising is increasingly led by Islamists and infiltrated by Al Qaeda operatives hailing from Iraq. Read more.
Greek Socialist Parties Raise Coalition Hopes
Greece's two socialist parties said they are committed to staying in the eurozone, spurring speculation of a possible coalition deal with the conservative (Christian Democratic) New Democracy party. The socialist parties, including social-democratic PASOK, which has been a major player in Greek politics, also criticized the Coalition of the Radical Left (SYRIZA) for insisting on renegotiation of the country's unpopular bailout/austerity agreement with the EU. Read the full story.
Iran's Curious Car Crash Coverage
The International Atomic Energy Agency has yet to release the identity of the IAEA inspector who was killed in a car crash in Iran on Tuesday. But Iran's official Islamic Republic News Agency (IRNA) quickly named the fatally injured inspector as Ok-Seok Seo, or Seo Ok-Seok, from South Korea.
IRNA said he died when the car he was riding in overturned about 250 km southwest of Tehran.
Iranian state TV showed video of the heavily damaged vehicle. Press TV, the regime's overseas propaganda vehicle, reported Seo Ok-Seok was "part of an IAEA team that periodically visits the heavy water nuclear reactor in the city of Arak in west-central Iran."
Iran claims the reactor will be used to produce isotopes for medical and industrial uses. But the United States and other nations suspect that the reactor could be used to produce plutonium for nuclear warheads.
The IAEA says the following about the Arak reactor, the existence of which was first disclosed by an Iranian opposition group.
F. Heavy Water Related Projects
30. Contrary to the relevant resolutions of the Board of Governors and the Security Council, Iran has not suspended work on all heavy water related projects, including the construction of the heavy water moderated research reactor, the Iran Nuclear Research Reactor (IR-40 Reactor), which is under Agency safeguards.32
31. On 14 February 2012, the Agency carried out a DIV [Design Information Verification] at the IR-40 Reactor at Arak and observed that construction of the facility was ongoing and that one heavy water concentration column had been installed. According to Iran, the operation of the IR-40 Reactor is planned to commence in 2014.33 In a letter dated 27 January 2012, the Agency, having not received any update of the DIQ [Design Information Questionnaire] for the IR-40 Reactor since January 2007, requested Iran to provide an updated DIQ.
32. Since its visit to the Heavy Water Production Plant (HWPP) on 17 August 2011, the Agency, in letters to Iran dated 20 October 2011 and 27 January 2012, requested further access to HWPP. The Agency has yet to receive a reply to those letters, and is again relying on satellite imagery to monitor the status of HWPP. Based on recent images, the HWPP appears to be in operation. To date, Iran has not provided the Agency with access to the heavy water stored at the Uranium Conversion Facility (UCF) in order to take samples.34
Is there any significance to Iran's rush to report the inspector's identity? In theory, the crash could have been staged in order to prevent the IAEA inspector from seeing something Iran didn't want him to see and/or as a retaliation for presumed assassinations by foreign intelligence services of Iranian nuclear scientists.
A possible additional motive comes to mind--namely, eliminating someone who could have been especially bothersome to Iran's partner in nuclear and missile crimes, North Korea, in a future inspection of its nuclear sites. Including the deceased inspector's name in a published news story would have been a secure way to communicate to Pyongyang that it no longer needed to concern itself about a certain South Korean national.
Copyright © 2012 Foreign Confidential™
Syria Says Suicide Bombers Kill 70 in Damascus
Deadliest Attacks Since Uprising Began
Dozens of people were killed today in a double suicide bombing in Damascus--the country's deadliest attack since an opposition uprising began 14 months ago.
State media say two suicide car bombers with 1,000 kilograms of explosives blew themselves up in quick succession in the capital's southern Qazaz district during Thursday's morning rush hour.
CBS News' George Baghdadi says human remains and badly burned bodies littered the streets after the explosions, which also destroyed as many as 40 cars and pickup trucks. Syrian Ministry of Interior says 70 people were killed by the explosions, including 15 whose bodies were completely torn apart. Another 372 were wounded, including civilians and members of the military, the ministry added.
Witnesses say the attack appeared to target a Syrian military intelligence building and damaged its facade.
The Syrian government blamed the bombings on terrorists whom it says are behind the revolt against President Bashar al-Assad. But the main exiled Syrian National Council accused the government of orchestrating the attack to try to smear the opposition movement and scare away a U.N. observer mission.
There was no immediate claim of responsibility for the blasts.
Thursday's attack happened one day after a roadside bombing near the rebellious southern city of Daraa wounded 10 Syrian soldiers who were escorting General Mood and other U.N. monitors. The U.N. personnel were unharmed.
N. Korea Vows to Build More Nukes
New Nuclear and Missile Tests Likely
Amid speculation of another rocket--really an ICBM--launch, North Korea vows to further strengthen its “nuclear deterrent” to protect its sovereignty “regardless of whatever the price it would pay.”
South Korea says the North appears to have completed preparations for a nuclear test, digging a new underground tunnel at its Punggye-ri test site in the country's northeast.
Something is going to happen this month, Foreign Confidential™ analysts predict. The North is likely to fire another ICBM or detonate a nuclear device, or do both of these things, before the end of May.
Wednesday, May 09, 2012
Kim Calls Theme Park 'Pathetic'
After lashing out at agriculture management, North Korea's young dictator has lambasted a state-owned theme park. Click here for the story.
There is more to this than meets the eye. Possibly influenced by China--meaning Mao--Kim could be attempting a modified revolution-from-the-top strategy in order to present himself to the masses as a populist leader at odds with a privileged class of uncaring bureaucrats. His real targets could be members of the elite; Kim and members of his inner circle could be preparing a purge.
The Pain in Spain
Tsipras Fails to Form Coalition
Turmoil in Greece
Anti-austerity SYRIZA (Coalition of the Radical Left) leader Alexis Tsipras today failed to form a coalition government in Greece. The baton will now pass to the Socialist PASOK party leader (who backs the austerity/bailout deal). A new election looms. Read more.
New Democracy won the most parliamentary seats in Sunday's election, followed by SYRIZA and PASOK. But no party won enough seats to be able to put together a new government on its own. Each party that tries gets 72 hours; PASOK's mandate will be the last, after which elections will be required.
Food Banks Mushrooming in the UK
Hunger No Longer Associated Only With the Developing World
Austerity Under Fire, 'Fatal Flaws' Slammed
Pulitzer Prize-winning journalist Joel Brinkley writes:
Austerity programs drive weak economies directly into recession. It's just that simple. And that's exactly what's happening in Europe. So far, 12 of Europe's 27 nations have fallen into recession. Spain and Britain are only the two most recent states to join that list, while several others are teetering. And if the tea-party types in Washington have their way, that's exactly what will happen here.
With Sarkozy's loss, 11 European heads of state have been driven out of office largely because they embraced austerity programs. The Dutch government just fell over a proposed austerity plan.
In Europe right now, the continent-wide unemployment rate stands at 10.9 percent -- the highest in 15 years. In Spain, the "leader," 23.6 percent are unemployed. As serious as those problems are, they aren't the only ones. Across southern Europe, primarily, dozens of people who have fallen into economic desperation are shooting and hanging themselves. Authorities have recorded scores of suicides.
Others are holding vast, angry rallies, like the ones across Europe on May Day. All of that certainly shattered still another of the Germanic arguments for austerity: to build confidence in the nations and their economies. That one clearly isn't working.
In fact, as Joseph Stiglitz, the Nobel Prize-winning American economist, aptly put it recently, "Europe is heading to a suicide" because "there has never been any successful austerity program in any large country."
The United Nations' International Labor Organization, in a new report, predicts that 6 million more people worldwide will lose their jobs by year's end -- "primarily in Europe" because "the narrow focus of many Eurozone countries on fiscal austerity is deepening the job crisis."
Francois Hollande, the French president-elect, is calling for what he calls "growth" policies instead. Generally that means spending stimulus money (as the Bush and Obama administrations did in the U.S.) so that the economy will grow and begin producing more tax revenues that can then be used to pay down the debt….
In Europe, German Chancellor Angela Merkel still refuses to accept that her policy prescription has been a cataclysmic failure. On Monday she insisted that "the fiscal pact" calling for austerity "is not negotiable."
Certainly, domestic politics are helping define her position. But millions are suffering; scores are dying. In Berlin, and Washington, it's time to wake up, look around and change your stance.
Click here to read Brinkley's entire essay.
Economist Paul Heise adds:
Austerity is being imposed on southern Europe by the Germans and is being supported by the international banks, including the European Central Bank. It is a disaster. Most observers now recognize that austerity is pushing these countries deeper and deeper into recession.
In Spain, the unemployment rate is 25 percent, and among those under 25 years of age it is 50 percent. We do not want to go there.
Europe has a problem, but it is not overspending, and austerity is not the solution. The deficits in Ireland, Spain, Portugal and to some extent Italy arose as a result of the financial crisis and the subsequent depression.
The normal cure for this is for a country to print money, lower the value of its currency and thereby increase exports, decrease imports and stimulate growth. This is a tried-and-true solution but an option that is not available as these countries do not have their own currency. When they joined the euro, they gave up the right to manage their economies using fiscal policy, and they set up no coordinating mechanism.
Iceland and Britain, though they were in worse financial shape than Spain and Portugal, do not have a problem because they still have their own currency.
Click here to read the full column.
Read all about "the Austerity Trap" here. An excerpt:
In countries that have pursued austerity and deregulation to the greatest extent, principally those in Southern Europe, economic and employment growth have continued to deteriorate. The measures also failed to stabilize fiscal positions in many instances. The fundamental reason for these failures is that these policies--implemented in a context of limited demand prospects and with the added complication of a banking system in the throes of its “deleveraging” process--are unable to stimulate private investment. The austerity trap has sprung. Austerity has, in fact, resulted in weaker economic growth, increased volatility and a worsening of banks’ balance sheets leading to a further contraction of credit, lower investment and, conse- quently, more job losses. Ironically, this has adversely affected government budgets, thus increasing the demands for further austerity. It is a fact that there has been little improvement in fiscal deficits in countries actively pursuing austerity policies.
S. Korea to North: Stop Jamming
South Korea said Wednesday that it was urging North Korea to immediately stop the massive GPS jamming that has raised aviation and shipping safety concerns amid the North's threats of armed action against Seoul. Click here to read the full story.
IAEA Inspector Killed in Car Crash in Iran
S. Korean National Was Traveling Near Arak Nuclear Site
The Washington Post's Joby Warrick reports:
The crash occurred at a sensitive time in the agency’s relations with the Iran, which is scheduled to meet with the United States and five other world powers later this month for a second round of talks on curbs to Iran’s nuclear program. The IAEA has been prodding Iran to account for past nuclear research that agency officials say appears related to the design and testing of nuclear warheads. Iran contends that its nuclear program is entirely peaceful.Foreign Confidential™ analysts say the timing of the crash is likely to raise suspicions of foul play. Iran’s lack of cooperation with IAEA inspectors--a cat and mouse game that has gone on for many years--has fueled suspicions of a covert nuclear arms program at Arak and other sites. Arak is one of the most mysterious sites--some exerts believe it is secretly being used to make weapons-grade plutonium.
Tuesday, May 08, 2012
Fighting for His Life, Chavez Looks to Jesus
Not too long ago, the Castro-admiring Venezuelan strongman Hugo Chavez was as anti-religious as he was anti-American. But battling cancer has apparently changed him; he is increasingly seen praying to Jesus, holding a crucifix. Click here for the story.
South Korea, Japan to Sign Defense Pacts
Kyodo News reports South Korea and Japan are expected to sign two historic military accords next Monday. Click here for the story.
Top German Political Leaders Threaten Greece
Greeks Again Feel Germany's Iron Heel on Their Necks
Merkel isn't a fascist, of course. But her insensitive obsession with imposing austerity on France and Greece--a policy that has not worked anywhere--is ironically aiding the rise of xenophobic (anti-German as well as anti-immigrant) Greek fascism. Click here to read about Greece's neo-Nazi party and its plots.
Greece is a bellwether. Every European … and every American … who cares about democracy, stability, social justice needs to pay attention to what's happening in Athens.
Endnote: Kostis Karpozilos, a historian of Greek-American labor radicalism, comments on the neo-Nazi Golden Dawn party, which got seven percent of the vote, bringing it 21 parliamentary representatives:
This is its first entrance to parliament in Greek history; in 2009 it was an insignificant group of true believers with 0.3 percent of the vote. Now Golden Dawn is entitled to substantial state subsidies as a parliamentary party; one can imagine how this will enhance its vigilant paramilitary squads in the streets of Athens. These ideological offspring of Adolf Hitler gained considerable support even in communities that had suffered during the German occupation in the 1940s, attesting to the deep transformations that have occurred over the last few years, but also to the popularity of their slogans calling politicians “traitors.”
Fresh Evidence Iran Sanitized Nuclear Site
John Swaine reports:
New satellite photographs appear to show that unusual activity has taken place in recent weeks at the Parchin site outside Tehran, according to the Institute for Science and International Security (ISIS).
A large stream of water pictured flowing from the building, said to feature an “explosive chamber” for testing, “raises concerns that Iran may have been washing inside the building,” according to the group.Read more.
Leftwing Greek Party Seeks Coalition
SYRIZA Leader Rejects 'Barbaric' Austerity
Alexis Tsipras, 38, head of the Coalition of the Radical Left, or SYRIZA, formally received the mandate to form a coalition government from President Karolos Papoulias at their meeting in Athens on Tuesday.
Conservative New Democracy leader Antonis Samaras, whose party was sharply reduced in Sunday's election, abandoned his bid to form a coalition government on Monday after only six hours of talks.
The mandate is valid for 72 hours.
Voters failed to give any party a majority, plunging Greece into more uncertainty.
The result is part of a wave of anti-austerity feeling that is building momentum in Europe.
International Red Cross Chief Speaks of Syrian Civil War
Kellenberger Says Rebels Use Guerrilla Tactics
Speaking in Geneva, Kellenberger also said the improved organization of the rebels means that recent battles in some parts of Syria meet the definition of a "non-international armed conflict," or civil war. Syrian rights activists said security forces killed at least three people in fighting around the country on Tuesday. Casualties could not be independently confirmed.
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