The US has endorsed French Finance Minister Christine Lagarde as the next head of the IMF, essentially guaranteeing her appointment, the Wall Street Journal reports. The decision comes just hours before the Fund’s board meets to decide on its new leader, and gives her the explicit support of more than…
Continue reading …Greek workers launched a 48-hour general strike today to protest government austerity measures as 20,000 demonstrators headed to Parliament and another 7,000 marched in the country’s second-biggest city. Some 5,000 police guarded Athens, and while the initial protests were peaceful, things are heating up. Young people threw…
Continue reading …Google stole a chunk of Microsoft’s corporate customers when it introduced its web-only Google Apps, but now Microsoft is pushing back with Office 365. The company is putting its extremely popular Microsoft Office software in the “cloud,” introducing the new online version this week. Customers will be able to use…
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Abdul Qadir Fitrat, who has fled to the US, denies claims he failed to act on warnings about corruption at Kabul Bank The former governor of the Afghan central bank who fled Afghanistan will be prosecuted over the failure of the country’s largest private lender, the attorney general’s office in Kabul said on Tuesday. Abdul Qadir Fitrat and other officials at the bank face prosecution for not acting on warnings about corruption at Kabul Bank, which nearly collapsed last year because of mismanagement and questionable lending practices, said General Rahmatullah Nazari, the deputy attorney general. He told reporters that an arrest warrant for Fitrat has been sent to Interpol and the US embassy in the Afghan capital. Kabul Bank – now under the control of the central bank – has become a symbol of the country’s cronyism and corruption. The lender is now considered a bellwether on attempts to root out patronage and show accountability to world financial institutions, such as the International Monetary Fund. The deputy attorney general said that Fitrat received several warnings from the country’s intelligence service and anti-corruption officials about widespread irregularities at Kabul Bank. “Instead, he wrote to the anti-corruption body that Kabul Bank was moving in the right course and that the bank was not facing any financial threats – that there was no crisis to be worried about,” Nazari said. “It, in itself, indicates involvement of the central bank governor with Kabul Bank authorities in the crisis. He did not take any precautionary steps.” On Monday, Fitrat told Associated Press in a phone call from Virginia that he resigned and fled to the US because threats had been made on his life. He said the Karzai government in Kabul was refusing to charge those involved in fraudulent loans. “My life has become completely endangered,” Fitrat said. “Since I exposed the fraudulent practices on 27 April in parliament I have received information about threats on my life.” He said he has permanent resident status in the US and would not return to Afghanistan. Afghanistan United States Banking guardian.co.uk
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Documents obtained by Greenpeace show prominent opponent of climate change was funded by ExxonMobil, among others One of the world’s most prominent scientific figures to be sceptical about climate change has admitted to being paid more than $1m in the past decade by major US oil and coal companies. Dr Willie Soon, an astrophysicist at the Solar, Stellar and Planetary Sciences Division of the Harvard-Smithsonian Centre for Astrophysics, is known for his view that global warming and the melting of the arctic sea ice is caused by solar variation rather than human-caused CO2 emissions, and that polar bears are not primarily threatened by climate change. But according to a Greenpeace US investigation , he has been heavily funded by coal and oil industry interests since 2001, receiving money from ExxonMobil , the American Petroleum Insitute and Koch Industries along with Southern, one of the world’s largest coal-burning utility companies. Since 2002, it is alleged, every new grant he has received has been from either oil or coal interests. In addition, freedom of information documents suggest that Soon corresponded in 2003 with other prominent climate sceptics to try to weaken a major assessment of global warming being conducted by the UN’s leading climate science body, the Nobel prize-winning Intergovernmental Panel on Climate Change . Soon, who had previously disclosed corporate funding he received in the 1990s, was today reportely unapologetic, telling Reuters that he agreed that he had received money from all of the groups and companies named in the report but denied that any group would have influenced his studies. “I have never been motivated by financial reward in any of my scientific research,” he said. “I would have accepted money from Greenpeace if they had offered it to do my research.” He did not respond to a request from the Guardian to comment. Documents provided to Greenpeace by the Smithsonian under the US Freedom of Information Act (FoIA) show that the Charles G Koch Foundation , a leading provider of funds for climate sceptic groups, gave Soon two grants totalling $175,000 (then roughly £102,000) in 2005/6 and again in 2010. In addition the American Petroleum insitute (API) , which represents the US petroleum and natural gas industries, gave him multiple grants between 2001 and 2007 totalling $274,000, oil company Exxon Mobil provided $335,000 between 2005 and 2010, and Soon received other grants from coal and oil industry sources including the Mobil Foundation, the Texaco Foundation and the Electric Power Research Institute . As one of very few scientists to publish in peer-reviewed literature denying climate change, Soon is widely regarded as one of the leading sceptical voices. His scientific position and the vehemence of his views has made him a central figure in a heated political debate that has informed the US right wing and helped to undermine public trust in the science of global warming and UN negotiations. “A campaign of climate change denial has been waged for over 20 years by big oil and big coal,” said Kert Davies, a research director at Greenpeace US. “Scientists like Dr Soon, who take fossil fuel money and pretend to be independent scientists, are pawns.” Soon has strongly argued that the 20th century was not a uniquely extreme climatic period. His most famous work challenged the “hockey stick” graph of temperature records published by Michael Mann, which showed a relatively sharp rise in temperatures during the second half of the 20th century. A paper published with Sallie Baliunas in 2003 in the journal Climate Research which attacked the hockey stick on flimsy evidence led to a group of leading climate scientists including Mann deciding to boycott the journal . In a letter to the Guardian in February 2004 , Soon wrote that the authors had been open about their sources of funding. “All sources of funding for our research were fully disclosed in our manuscript. Most of our funding came from federal agencies, including the Air Force Office of Scientific Research and Nasa,” he wrote. He has also questioned the health risks of mercury emissions from coal and in 2007 co-wrote a paper that down-played the idea that polar bears are threatened by human-caused climate change The investigation is likely to embarrass Exxon, the world’s largest oil company, which for many years funded climate sceptics but in 2008 declared it would cut funds to lobby groups that “divert attention” from the need to find new sources of clean energy . According to the documents, Exxon provided $55,000 for Soon to study Arctic climate change in 2007 and 2008, and another $76,106 for research into solar variability between 2008 and 2010. Exxon spokesman Alan Jeffers said this week the company did not fund Soon last year, and that it funds hundreds of organisations to do research on climate and the environment. Southern gave Soon $120,000 starting in 2008 to study the Sun’s relation to climate change, according to the FIA documents. Spokeswoman Stephanie Kirijan said the company has spent about $500m on funding environmental research and development ,and that it did not fund Soon last year. In one 2003 email released to Greenpeace, that Soon sent, it is believed, to four other leading sceptics, he writes: “Clearly [the fourth assessment report] chapters may be too much for any one of us to tackle them all … But as a team, we may give it our best shot to try to anticipate and counter some of the chapters …” He adds: “I hope we can … see what we can do to weaken the fourth assessment report.” In 2003 Soon said at a US senate hearing that he had “not knowingly been hired by, nor employed by, nor received grants from any organisation that had taken advocacy positions with respect to the Kyoto protocol or the UN Framework Convention on Climate Change.” Climate change scepticism Climate change Climate change Oil John Vidal guardian.co.uk
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Libya stabilisation report submitted by UK to Benghazi opposition outlines priorities after ceasefire Britain is calling for a “politically inclusive settlement” in post-Gaddafi Libya that will take heed of the mistakes made in Iraq after the 2003 US-led invasion. A detailed “stabilisation document”, overseen by the Department for International Development, has been submitted to the Benghazi-based Libyan opposition and sets out priorities after a ceasefire between the regime and rebels. It assumes that Gaddafi – wanted by the international criminal court for alleged crimes against humanity – will leave or be forced from power, but it does not predict when that will happen. “It (the stabilisation process) must be Libyan-owned and United Nations-led,” Andrew Mitchell, the international development secretary, said on Tuesday. “The work seeks to ensure that the international community learns the lessons of what happened in Iraq.” Issues range from preventing looting and revenge attacks to providing basic services, and ensuring effective communications to ensure Libyan citizens know what is happening at a time of uncertainty. Unarmed UN monitors would most likely police a ceasefire if the environment was “benign” but there are discussions about a heavier peacekeeping force. Turkey, Nato’s only Muslim member, is expected to play a key part. Britain, playing a leading role in Nato’s bombing campaign, has ruled out contributing to any peacekeeping force on the principle that it will not put “boots on the ground”, insisted Mitchell. Security and justice are the second of five priorities, with the recommendation that Libya should not follow the Iraqi example of disbanding the army, which has been seen by some officials as a strategic mistake that helped fuel the insurgency in the sensitive and volatile circumstances after Saddam Hussein’s overthrow. “The report has learned the lesson of Iraq about the importance of using to the maximum possible extent existing structures,” Mitchell said. “One of the first things that should happen once Tripoli falls is that someone should get on the phone to the former Tripoli chief of police and tell him he has got a job and he needs to secure the safety and security of the people of Tripoli. Of course, at that stage the sanctions on assets will be unfrozen and money will be able to flow much more easily than it is at the moment so as well as having a job he might actually get paid.” Benghazi’s rebel leaders “have spent some time working out who to call at that point and who to engage with to demonstrate the importance of good order”. The US, Britain and the UN would have “strong input” into a post-Gaddafi political settlement; the EU, Nato and the UN would take the lead on issues of security and justice; Australia, Turkey and the UN would help with basic services; Turkey, the US and the international financial institutions would lead on the economy. But, added Mitchell: “It is incredibly important that the whole of this process is Libyan-owned. This has been done as a service to the Libyan people.” The 50-page report, which includes recommendations on infrastructure, oil exports and basic services such as education, water and health, was produced by the UK-led international stabilisation response team, and is expected to win Libyan opposition, international and Arab approval at a meeting of the Libyan contact group in Istanbul in mid-July. “The position for Colonel Gaddafi is getting more and more difficult every day,” said Mitchell. “In military terms he has lost half of all his capacity. The international criminal court arrest warrants … have sent a signal to Gaddafi’s militias and his supporters. In the days of the mobile phone you can photograph human rights violators and war criminals in action. People at all levels, including in his militias, are leaving and defecting. All of this suggests that his time is limited.” Libya United Nations Muammar Gaddafi Middle East Africa Ian Black guardian.co.uk
Continue reading …With Robert Gates, who has served eight presidents over four decades, about to retire, the Washington Post looks back at how Gates operated in the Pentagon. He’s been “careful, conservative, and consensus-oriented,” writes Greg Jaffe, and he’s “earned a reputation as the most ruthlessly efficient defense secretary in decades.” So…
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Greece puts €50bn of national assets on sale in hotel ballroom but private equity firms are not interested While Greece erupted in protest again yesterday, representatives of the country’s government were at Claridge’s hotel trying to drum up international investors’ interest in a “fire sale” of its national assets. Up for sale are 39 airports, 850 ports, railways, motorways, sewage works, a couple of energy companies, banks, defence groups, thousands of acres of land for development, casinos and Greece’s national lottery. George Christodoulakis, Greece’s special secretary for asset restructuring and privatisations, said the sell-off would raise €50bn (£44bn) to help pay back the country’s €110bn bailout debt . The private equity bosses gathered in the hotel’s ballroom for the parade of Greece’s national treasures showed little interest in buying anything. Nikos Stathopoulous, managing partner of BC Partners, which has invested more than €3.5bn in Greece, said investors are put off by bureaucracy, strong unions, corruption and a lack of transparency. “Even in the good times Greece is not a country that attracts investment. Foreign investors don’t want to invest in a country where there is no flexibility in hiring and firing people,” he said. “You don’t want to invest in a country in which you wake up and a new law has been passed which totally undermines and destroys the value of the investment you’ve just made.” Stathopoulous said investors were finding it very hard to assess the risk of investing into Greece, which means assets “will be priced at lower than they are worth, lower than the Greek government, and even the European Union, expects”. Aref Lahham, managing director and founding partner of Orion Capital Managers, said most private equity firms would not buy Greek assets because the “risks are too high”. He added: “I think people will not buy those assets, that is the sad truth.” Lahham said more than half of the assets up for sale comprises land for commercial or residential development, which is unattractive because of the difficulty of securing financing to build in Greece. His firm was attracted by the potential of Greek tourism but legislation made it difficult for foreign companies to develop the country’s islands and beaches. “Greece is a fantastic tourism destination with very undeveloped infrastructure. There isn’t a Four Seasons or a Shangri-La or a Peninsula or any of the major hotel chains in Greece,” he said. “It’s strange, they would love to be there and we would love to build it for them, but somehow regulations don’t allow you to do so.” Lahham said Greece’s ambition to sell €15bn of assets by 2012 and the full €50bn by 2015 meant there was not enough time to carry out due diligence properly. “I simply do not believe the timescale. I’m afraid it is not going to happen within times – I’m afraid it is a fire sale.” Christodoulakis denied that the hastily arranged sell-off was a fire sale, preferring to describe it as a “professionally managed privatisation plan”. “We may sell them cheaper than [during normal conditions] but we will devote the funds to buying back debt, that means we are going to buy it back when it is cheaper.” When a fellow Greek interrupted to say the sell-off was “destroying our country”, Christodoulakis said there was “no point crying over spilt milk” and told his countryman to “try and be optimistic”. European debt crisis European banks Greece Europe Rupert Neate guardian.co.uk
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French finance minister, who succeeds Dominique Strauss-Kahn, becomes first woman to hold top IMF job French finance minister Christine Lagarde has become the new head of the IMF after the fund’s board confirmed her appointment following a meeting in Washington. Lagarde, who takes over from Dominique Strauss-Kahn, is the first woman to hold the post. She will begin her five-year term on 5 July. After the board’s announcement, Lagarde tweeted : “The results are in: I am honored & delighted that the Board has entrusted me with the position of MD of the IMF!” Official confirmation came after the US hadformally endorsed Lagarde’s candidacy. Treasury secretary Tim Geithner said: “Minister Lagarde’s exceptional talent and broad experience will provide invaluable leadership for this indispensable institution at a critical time for the global economy. We are encouraged by the broad support she has secured among the fund’s membership, including from the emerging economies.” French president Nicolas Sarkozy was quick to show his support for his compatriot. He said in a statement: “The French presidency rejoices that a woman is taking on this important international role.” Chancellor George Osborne hailed Lagarde’s appointment as “good news for the global economy and for Britain.” He said: “She is the best person for the job, which is why Britain was one of the first countries to propose her. She has been a strong advocate for countries tackling high budget deficits and living within their means.” Lagarde has the support of most European countries, and is seen as an ideal candidate to handle the IMF’s ongoing bailout of weak eurozone countries. Many observers felt the time had come for a non-European to take the post, but despite initial coolness towards her candidacy China and Russia backed Lagarde’s appointment. Along with the US, she has the explicit support of nations including Indonesia and Egypt, representing more than half the IMF’s 24 voting board members. The executive board represents the 187 members of the IMF. Russian finance minister Alexei Kudrin told the ITAR-TASS news agency: “I think that she has all the necessary qualities and we will support her candidacy. She will be able to make this key international organisation more dynamic, and ensure its future reform.” Her closest competitor, Mexican central banker Agustín Carstens, won endorsements from Mexico, Canada and Australia, which together represent 12% of IMF board seats. Geithner commended Carstens “on his strong and very credible candidacy.” Lagarde’s appointment caps a tumultuous period for the IMF, currently led by Strauss-Kahn’s deputy John Lipsky, who was planning to retire before Strauss-Kahn’s arrest. “I am well aware that recent events have left open wounds,” Lagarde said in a statement to the IMF. “I know that John [Lipsky's] departure, coming as it does at the very worst of times, will leave a big hole. The incoming MD must take pains to show the outside world that this great institution is not only leading in terms of expertise, but also in terms of integrity and work ethics.” Emerging market countries initially fought hard to have one of their own claim the top IMF job. The IMF has been headed by a European since is creation at the end of second world war. But with Europe in crisis the French minister emerged as the clear favourite. Lagarde, 55, led the Chicago-based law firm Baker & McKenzie before entering French politics in 2005. She is the first woman to head the IMF. Mohamed El-Erian, a former IMF official and now chief executive of Pimco, one of the world’s largest bond investors, said: “[Lagarde's] major priority is to restore legitimacy to an institution demoralised by the arrest of Strauss-Kahn, seen to be excessively influenced by political directives, and lacking global legitimacy, especially among emerging economies. El-Erian added: “She needs to follow up on her promises to emerging economies, including removing nationality-based approaches to key appointments. “She can start with the soon-to-be-vacant first deputy post which, traditionally, has been a US Treasury decision rather than one based on merit. “She needs to make the IMF more representative of today’s global realities, restore technical rigor to its interactions with member countries, and prepare the balance sheet for the potential of some financial impairment on account of recent lending.” Christine Lagarde IMF Economics France Global economy Europe Dominic Rushe guardian.co.uk
Continue reading …President Obama’s 2012 machine is revving up early, and his campaign is using all its assets to pull in wealthy donors—while also courting the small Internet donors that fueled his grass-roots machine in 2008. The Washington Post takes a long look at the fundraising push, which has included everything…
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