ECB to take action; Merkel, Barroso express concern
Money is talk of the town and money, “The social lubricant” with a near free-fall of the US dollar, is sending ripples across the globe affecting all quarters of life. The steady fall of the American dollar against other global currencies and the meteoric rise of the nascent European currency, the Euro, is making financial pundits act and react.
Acknowledging the reemergence of tension in money markets, the European Central Bank (ECB) announced, “To counter the re-emerging risk of volatility, the ECB intends to reinforce in the upcoming main refinancing operation, as well as in the following ones for as long as it is needed and at least until after the end of the year, its policy of allocating more liquidity than the benchmark amount in main refinancing operations.” The benchmark amount is an estimate of the liquidity needed by banks to fulfil their minimum reserve requirements.
“In line with its communication of October 8th, the ECB will continue to closely monitor liquidity conditions, consistently with its aim to limit the volatility of very short term rates around the main refinancing operations minimum bid rate,” the bank in a move aimed at financial markets said.
Reiterating faith in the earlier ECB actions as “effective and flexible,” ECB president Jean- Claude Trichet said, “Looking ahead, and in line with its previous communications and actions, the ECB will continue to steer very short term interbank rates close (to) the minimum bid rate.”
Commenting on the strength of the Euro becoming a problem for some European exporters, German Chancellor Angela Merkel told N24 television on November 22 that the strong Euro and high oil prices pose a risk to the country’s economy — Europe’s largest. “We are pleased that Europe has a strong currency, but this obviously also creates problems for exports,” she said adding, “We are working on an international level to balance currency imbalances reasonably.”
European Commission President Jose Manuel Barroso echoed her sentiments last week. Speaking on the side lines of an EU-ASEAN Summit in Singapore, Barroso said, “It’s true that the very strong Euro is becoming a concern to some export sectors in some parts of the European economy.”
The European Commission this month cut its forecast for 2008 Eurozone economic growth to 2.2 percent from 2.5 percent.
In related fallout in the industry, Airbus CEO Thomas Enders said the Euro has now “crossed the pain threshold” and that the rate of the dollar’s fall “hardly leaves room for reasonable adapting.” “That is lifethreatening,” he was quoted by Der Spiegel magazine as telling the company worker’s council in Hamburg on November 22.
Although the company is expecting a record number of orders, it still must reckon with “tremendous losses,” he said. But the German economics ministry reacted the next day saying it is up to the aircraft maker Airbus and not the government to estimate the impact of the strong Euro on the company’s performance. “Only the company itself can assess how threatening such a development is for the company,” said an economics ministry spokeswoman. “Only the company can say to which degree the Euro has contributed to its development.”
Moreover, there is a flip side of the strong Euro as was pointed out by Merkel’s deputy economics minister. The rising Euro is damping the effect of rising oil prices, noted Bernd Pfaffenbach, who is also Merkel’s advisor on the Group of Eight industrial nations’ issues.
Recalling the worries during the birth of the European currency that Euro will even stay weaker than the Deutsche Mark, Pfaffenback welcome the news that China has announced plans to shift its currency reserves into Euro adding, “This shows a growth in faith in the European currency.”
Although burdened with strikes and transport chaos at home and silent directly on the rising Euro, French President Nicolas Sarkozy was about to address the currency issue during talks with Chinese leaders in Beijing.
According to media reports, a senior French official was cited as saying that Sarkozy will make proposals for an “equitable and fair” relationship among four major currencies - the US dollar, Euro, Japanese Yen and Chinese Yuan.
The common currency for the 13-nation Eurozone is hovering close to the USD 1.50 mark against the American dollar, breaking all records.
Sunday, November 25, 2007
Bakoyannis’ pragmatic ideas
Greece paves way for European prospects of Western Balkans
The citizens of the Western Balkans need a specific vision to feel welcome into the fold of the European Union while the concerned governments need to embark on specific road with a goal none other than the EU, according to a Greek package with five specific proposals on giving a new impetus to the European course of Western Balkan countries.
After presenting the proposals to the European Union’s General Affairs Council in Brussels on November 19, Greek Foreign Minister Dora Bakoyannis said that Greece took the opportunity of tabling a very specific new initiative on the European prospects of the Western Balkans. She said that the time is very difficult for the Western Balkans and there is an urgent need for a specific vision and a specific goal than can be none other than the European vision.
Calling on the governments of 27 member states and the executive arm, the European Commission to explore the possibility to charter a path of specific moves to implement the Greek proposals, the Greek foreign minister stressed the need to convey a loud and clear welcome message to all the people of the Western Balkans.
“We believe that we will be having the possibility of discussing this proposal in more detail in December at the EU summit,” she said. Bakoyannis added that the initial response by her European counterparts, and by Enlargement Commissioner Olli Rehn, was very positive. “We all realise that it is a difficult period that requires a substantive, aggressive and effective European policy on this issue,” she said.
Recalling that in 1999, Greece had formulated a comprehensive policy, the Stabilisation and Association Process (SAP) and in 2003, the Thessaloniki Agenda took it a step further along the elements inspired by the enlargement process, the Greek Foreign minister Bakoyannis reiterated the need to take “some new courageous decisions on the Western Balkans.”
Lamenting today’s EU accession prospect for the Western Balkans appearing distant and even uncertain, Bakoyannis said, “A clear prospect of membership is the most important and perhaps the most effective tool at out disposal, to help the countries of the Western Balkans overcome state weaknesses and political, social and economic challenges, and catch up with the rest of Europe.”
Answering journalists’ questions, Bakoyannis said, “We need to send a positive message to the whole region that they are not left alone there and we must do it by giving practical and tangible signals.” “We need to have a specific road map for moving from today’s position to further.”
Presenting the fivepoint proposal package also nicknamed “Thessaloniki II” to the journalists, George Koumoutsakos, spokesman of Greek foreign ministry summarised it as follows:
- Within this framework and as a first step, the EU should immediately sign Stabilisation and Association Agreements with Serbia and at the earliest with Bosnia Herzegovina: the two countries remaining within which internal problems haven’t permitted such a positive step so far
- Serbia, in the first place, followed by the rest of the countries that would have a SA Agreement but no candidate status, should be encouraged to apply for membership. The Commission could present the avis on the application in the fall of 2008. The December European Council of 2008 could decide about granting the candidate status to any applicant country
- A date for the start of Accession negotiations will be decided later on, depending on the progress on fulfillment of specific benchmarks that will be set. Any additional step in the accession process will depend on each country’s progress in meeting the specific and tailormade requirements set by the EU in full application of the principle of conditionality
- However, in order to have, through the European perspective, the effect we desire, we should combine it with measures that would translated this perspective into something practical and tangible for the peoples of the region. Something that corresponds to their basic requests. Already in Thessaloniki we declared, “We were aware of the importance the peoples and governments of the region attach to the perspective of liberalisation of the visa regime.” We had promised to help the countries to deal with these issues to make such a move possible. Following the visa facilitation agreements, that we signed this year, the EU should not provide the countries of the region with a road mal that would eventually lead to the visa liberalisation: A series of concrete and measureable benchmarks and an outline of the necessary steps with an indicative timetable
- Additional financial resources will also be necessary. Within out actual budgetary obligations, we should make full use of the “principle of flexibility” in order to guarantee that any additional available fund will be directed, as a priority, to the region of the Western Balkans. Furthermore and in the light of the net financial perspectives, we should explore all possibilities that would allow a substantial increase of aid, in an effort to meet the increasing needs and serve our own priorities, in this sensitive region at this very delicate of time.
The citizens of the Western Balkans need a specific vision to feel welcome into the fold of the European Union while the concerned governments need to embark on specific road with a goal none other than the EU, according to a Greek package with five specific proposals on giving a new impetus to the European course of Western Balkan countries.
After presenting the proposals to the European Union’s General Affairs Council in Brussels on November 19, Greek Foreign Minister Dora Bakoyannis said that Greece took the opportunity of tabling a very specific new initiative on the European prospects of the Western Balkans. She said that the time is very difficult for the Western Balkans and there is an urgent need for a specific vision and a specific goal than can be none other than the European vision.
Calling on the governments of 27 member states and the executive arm, the European Commission to explore the possibility to charter a path of specific moves to implement the Greek proposals, the Greek foreign minister stressed the need to convey a loud and clear welcome message to all the people of the Western Balkans.
“We believe that we will be having the possibility of discussing this proposal in more detail in December at the EU summit,” she said. Bakoyannis added that the initial response by her European counterparts, and by Enlargement Commissioner Olli Rehn, was very positive. “We all realise that it is a difficult period that requires a substantive, aggressive and effective European policy on this issue,” she said.
Recalling that in 1999, Greece had formulated a comprehensive policy, the Stabilisation and Association Process (SAP) and in 2003, the Thessaloniki Agenda took it a step further along the elements inspired by the enlargement process, the Greek Foreign minister Bakoyannis reiterated the need to take “some new courageous decisions on the Western Balkans.”
Lamenting today’s EU accession prospect for the Western Balkans appearing distant and even uncertain, Bakoyannis said, “A clear prospect of membership is the most important and perhaps the most effective tool at out disposal, to help the countries of the Western Balkans overcome state weaknesses and political, social and economic challenges, and catch up with the rest of Europe.”
Answering journalists’ questions, Bakoyannis said, “We need to send a positive message to the whole region that they are not left alone there and we must do it by giving practical and tangible signals.” “We need to have a specific road map for moving from today’s position to further.”
Presenting the fivepoint proposal package also nicknamed “Thessaloniki II” to the journalists, George Koumoutsakos, spokesman of Greek foreign ministry summarised it as follows:
- Within this framework and as a first step, the EU should immediately sign Stabilisation and Association Agreements with Serbia and at the earliest with Bosnia Herzegovina: the two countries remaining within which internal problems haven’t permitted such a positive step so far
- Serbia, in the first place, followed by the rest of the countries that would have a SA Agreement but no candidate status, should be encouraged to apply for membership. The Commission could present the avis on the application in the fall of 2008. The December European Council of 2008 could decide about granting the candidate status to any applicant country
- A date for the start of Accession negotiations will be decided later on, depending on the progress on fulfillment of specific benchmarks that will be set. Any additional step in the accession process will depend on each country’s progress in meeting the specific and tailormade requirements set by the EU in full application of the principle of conditionality
- However, in order to have, through the European perspective, the effect we desire, we should combine it with measures that would translated this perspective into something practical and tangible for the peoples of the region. Something that corresponds to their basic requests. Already in Thessaloniki we declared, “We were aware of the importance the peoples and governments of the region attach to the perspective of liberalisation of the visa regime.” We had promised to help the countries to deal with these issues to make such a move possible. Following the visa facilitation agreements, that we signed this year, the EU should not provide the countries of the region with a road mal that would eventually lead to the visa liberalisation: A series of concrete and measureable benchmarks and an outline of the necessary steps with an indicative timetable
- Additional financial resources will also be necessary. Within out actual budgetary obligations, we should make full use of the “principle of flexibility” in order to guarantee that any additional available fund will be directed, as a priority, to the region of the Western Balkans. Furthermore and in the light of the net financial perspectives, we should explore all possibilities that would allow a substantial increase of aid, in an effort to meet the increasing needs and serve our own priorities, in this sensitive region at this very delicate of time.
Saturday, November 17, 2007
Climate change action gets into fast lane
“Better late than never.” With that the participants heaved a sigh of relief in Valencia, Spain after a marathon 24- hour session ending November 16 as the compromise 20-page Intergovernmental Panel on Climate Change (IPCC) document emerged to act as a manual on how to tackle global warming and set the tone for a crucial United Nations (UN) climate conference next month in Bali, Indonesia.
Officially unveiling the report in Valencia, UN Secretary General Ban Ki-moon pointed out that the IPCC report states that climate change is “unequivocal” and may bring “abrupt and irreversible” impacts.
Fresh from a fact-finding mission to Antarctica and South America, Ban cautioned, “All humanity must assume responsibility for these treasures,” saying, “I come to you humbled after seeing some of the most precious treasures of our planet threatened by humanity’s own hand.” “Let us recognise that the effects of climate change affect us all, and that they have become so severe and so sweeping that only urgent global action will do. We are all in this together - we must work together,” Ban added.
In Brussels, the seat of the European Union, the untiring champion of the fight against climate change, it was hailed as “vital reading for decision makers,” by top EU officials. European Union Environment Commissioner Stavros Dimas said in a statement, “The Fourth Assessment Report is a milestone in our scientific knowledge about climate change and the grave threats global warming poses to the planet.”
Dimas said, “The report’s findings amount to a stark warning that the world must act fast to slash greenhouse gas emissions if we are to prevent climate change from reaching devastating levels. The good news is that it also shows that deep emission cuts are both technologically feasible and economically affordable.”
He added: “This synthesis report is vital reading for decisionmakers everywhere ahead of the UN climate change conference in Bali starting in just over two weeks. It fully supports the EU policy that global warming must be limited to no more than 2ºC above the pre-industrial temperature. The global community must respond to this scientific call for action by agreeing in Bali to launch negotiations on a comprehensive and ambitious new global climate agreement.
Efforts will be needed by all major emitters if we are to have a chance of controlling climate change before it is too late.”
Reiterating its commitment, the European Commission listed the key elements of EU action:- To reduce greenhouse gas emissions by at least 20 percent below 1990 levels by 2020, that will be strengthened to 30 percent reduction in the context of a fair global agreement - A firm target to increase the use of renewable energy to 20 percent by 2020- A broad range of measures to improve energy efficiency by 20 percent by 2020- Further evolution and strengthening of the EU’s emissions trading scheme;- An ambitious limit to CO2 emissions from cars- A framework for introducing Carbon Capture and Storage (CCS) in power production- Development of an effective adaptation strategy
Moreover, the United States, which has earned the wrath of climate change campaigners for not doing enough, did participate along with nearly 150 countries to nod the compromise report through after five days of haggling.
Rajendra Pachauri, an Indian scientist who heads IPCC warned that even if global emissions are curbed and the present levels of CO2 in the atmosphere stayed at the same level there would be a rise between 0.4 and 1.4 metres of the present day sea-levels simply because water expands as it warms.
“If you add to this the melting of some of the ice bodies on Earth, this gives a picture of the kinds of issue we are likely to face,” Pachauri said in post-publication comments on the report.
The synthesis report forms the final part of “Climate Change 2007”, the IPCC’s report. The other three parts were released earlier this year and covered the physical science of climate change; impacts, adaptation and vulnerability and ways to mitigate climate change.
The IPCC was awarded this year’s Nobel Peace Prize jointly with former US Vice-President Al Gore “for their efforts to build up and disseminate greater knowledge about man-made climate change and to lay the foundations for the measures that are needed to counteract such change”.
Officially unveiling the report in Valencia, UN Secretary General Ban Ki-moon pointed out that the IPCC report states that climate change is “unequivocal” and may bring “abrupt and irreversible” impacts.
Fresh from a fact-finding mission to Antarctica and South America, Ban cautioned, “All humanity must assume responsibility for these treasures,” saying, “I come to you humbled after seeing some of the most precious treasures of our planet threatened by humanity’s own hand.” “Let us recognise that the effects of climate change affect us all, and that they have become so severe and so sweeping that only urgent global action will do. We are all in this together - we must work together,” Ban added.
In Brussels, the seat of the European Union, the untiring champion of the fight against climate change, it was hailed as “vital reading for decision makers,” by top EU officials. European Union Environment Commissioner Stavros Dimas said in a statement, “The Fourth Assessment Report is a milestone in our scientific knowledge about climate change and the grave threats global warming poses to the planet.”
Dimas said, “The report’s findings amount to a stark warning that the world must act fast to slash greenhouse gas emissions if we are to prevent climate change from reaching devastating levels. The good news is that it also shows that deep emission cuts are both technologically feasible and economically affordable.”
He added: “This synthesis report is vital reading for decisionmakers everywhere ahead of the UN climate change conference in Bali starting in just over two weeks. It fully supports the EU policy that global warming must be limited to no more than 2ºC above the pre-industrial temperature. The global community must respond to this scientific call for action by agreeing in Bali to launch negotiations on a comprehensive and ambitious new global climate agreement.
Efforts will be needed by all major emitters if we are to have a chance of controlling climate change before it is too late.”
Reiterating its commitment, the European Commission listed the key elements of EU action:- To reduce greenhouse gas emissions by at least 20 percent below 1990 levels by 2020, that will be strengthened to 30 percent reduction in the context of a fair global agreement - A firm target to increase the use of renewable energy to 20 percent by 2020- A broad range of measures to improve energy efficiency by 20 percent by 2020- Further evolution and strengthening of the EU’s emissions trading scheme;- An ambitious limit to CO2 emissions from cars- A framework for introducing Carbon Capture and Storage (CCS) in power production- Development of an effective adaptation strategy
Moreover, the United States, which has earned the wrath of climate change campaigners for not doing enough, did participate along with nearly 150 countries to nod the compromise report through after five days of haggling.
Rajendra Pachauri, an Indian scientist who heads IPCC warned that even if global emissions are curbed and the present levels of CO2 in the atmosphere stayed at the same level there would be a rise between 0.4 and 1.4 metres of the present day sea-levels simply because water expands as it warms.
“If you add to this the melting of some of the ice bodies on Earth, this gives a picture of the kinds of issue we are likely to face,” Pachauri said in post-publication comments on the report.
The synthesis report forms the final part of “Climate Change 2007”, the IPCC’s report. The other three parts were released earlier this year and covered the physical science of climate change; impacts, adaptation and vulnerability and ways to mitigate climate change.
The IPCC was awarded this year’s Nobel Peace Prize jointly with former US Vice-President Al Gore “for their efforts to build up and disseminate greater knowledge about man-made climate change and to lay the foundations for the measures that are needed to counteract such change”.
Climate change action gets into fast lane
“Better late than never.” With that the participants heaved a sigh of relief in Valencia, Spain after a marathon 24- hour session ending November 16 as the compromise 20-page Intergovernmental Panel on Climate Change (IPCC) document emerged to act as a manual on how to tackle global warming and set the tone for a crucial United Nations (UN) climate conference next month in Bali, Indonesia.
Officially unveiling the report in Valencia, UN Secretary General Ban Ki-moon pointed out that the IPCC report states that climate change is “unequivocal” and may bring “abrupt and irreversible” impacts.Fresh from a fact-finding mission to Antarctica and South America, Ban cautioned, “All humanity must assume responsibility for these treasures,” saying, “I come to you humbled after seeing some of the most precious treasures of our planet threatened by humanity’s own hand.” “Let us recognise that the effects of climate change affect us all, and that they have become so severe and so sweeping that only urgent global action will do. We are all in this together - we must work together,” Ban added.
In Brussels, the seat of the European Union, the untiring champion of the fight against climate change, it was hailed as “vital reading for decision makers,” by top EU officials. European Union Environment Commissioner Stavros Dimas said in a statement, “The Fourth Assessment Report is a milestone in our scientific knowledge about climate change and the grave threats global warming poses to the planet.”
Dimas said, “The report’s findings amount to a stark warning that the world must act fast to slash greenhouse gas emissions if we are to prevent climate change from reaching devastating levels. The good news is that it also shows that deep emission cuts are both technologically feasible and economically affordable.”
He added: “This synthesis report is vital reading for decisionmakers everywhere ahead of the UN climate change conference in Bali starting in just over two weeks. It fully supports the EU policy that global warming must be limited to no more than 2ºC above the pre-industrial temperature. The global community must respond to this scientific call for action by agreeing in Bali to launch negotiations on a comprehensive and ambitious new global climate agreement. Efforts will be needed by all major emitters if we are to have a chance of controlling climate change before it is too late.”
Reiterating its commitment, the European Commission listed the key elements of EU action:- To reduce greenhouse gas emissions by at least 20 percent below 1990 levels by 2020, that will be strengthened to 30 percent reduction in the context of a fair global agreement - A firm target to increase the use of renewable energy to 20 percent by 2020- A broad range of measures to improve energy efficiency by 20 percent by 2020- Further evolution and strengthening of the EU’s emissions trading scheme;- An ambitious limit to CO2 emissions from cars- A framework for introducing Carbon Capture and Storage (CCS) in power production- Development of an effective adaptation strategy
Moreover, the United States, which has earned the wrath of climate change campaigners for not doing enough, did participate along with nearly 150 countries to nod the compromise report through after five days of haggling.
Rajendra Pachauri, an Indian scientist who heads IPCC warned that even if global emissions are curbed and the present levels of CO2 in the atmosphere stayed at the same level there would be a rise between 0.4 and 1.4 metres of the present day sea-levels simply because water expands as it warms.
“If you add to this the melting of some of the ice bodies on Earth, this gives a picture of the kinds of issue we are likely to face,” Pachauri said in post-publication comments on the report.
The synthesis report forms the final part of “Climate Change 2007”, the IPCC’s report. The other three parts were released earlier this year and covered the physical science of climate change; impacts, adaptation and vulnerability and ways to mitigate climate change.
The IPCC was awarded this year’s Nobel Peace Prize jointly with former US Vice-President Al Gore “for their efforts to build up and disseminate greater knowledge about man-made climate change and to lay the foundations for the measures that are needed to counteract such change”.
Tuesday, November 13, 2007
Gas era set to dawn in India
Ships equipped with re-gasification gear an answer
Power shortages leading to blackouts are already taking their toll on production, and then the cumulative effect is filtering down to export markets. That’s the scene blurring grand visions of making India a manufacturing hub to alleviate poverty, which keeps more than two-thirds of the rural population engaged in a vicious cycle of an agricultural sector dependent on weather unpredictability.
With an economic boom touching nine percent over the last few years showing no sign of slowing down, India’s insatiable hunger for energy has not been matched by a proportionate increase in supply over the years. Estimates point that India’s energy needs are set to grow by 40 percent, moving it from sixth slot to fourth position in the world’s top consuming nations by 2012.
“Cleaner burning and more efficient than coal,” coupled with the fact that tonnes of stranded gas around the world are just looking for a market, natural gas seems to be the answer to the ever-increasing demand for power in the present Indian environs, where the ways and means to provide sustainable and reliable solutions are far from clear.
Government figures show that the country’s domestic gas supply is 65 million standard cubic metres per day, while demand stands at 231 mmscmd and the projections put it to rise to 313 mmscmd by 2011-2012. India’s Planning Commission in its approach paper to its 11th Five-Year Plan that an ongoing sequence since it was launched five decades ago identified that among other factors, “... above all, power supply are not comparable to those prevalent in our competitor countries.”
Warning that, “... this gap must be filled within the next five to 10 years if our enterprises are to compete effectively,” the paper stressed that, today, Indian companies are not asking for state protection but at least, “expect a level playing field.” It may be noted that although industrial units are savvy about their own power plants, the acute lack of feeding fuel remains a major stumbling block. With focus shifting to cleaner industrialisation, there is a gas era ready to come of age, but latest government figures show the country failed to import only a third of the gas it wanted in 2006-2007.
One of the major reasons is the inadequate infrastructure in the country to handle gas imports as only two of the planned four terminals for LNG (Liquefied Natural Gas) re-gasification viz. Shell’s Hazira terminal and Petronet’s Dahej terminal, are operating while the Kochi terminal and the Dabhol are yet to get commissioned. These special terminals are needed as gas is shipped in liquid form and needs to be re-gasified when the ship berths. Lack of such specialised terminals left not only the power sector but also the fertilizer sector literally gasping for gas.
The geo-political situation around the world has cast its long dark shadows on the Indian government’s options to get international pipeline projects like the Iran-Pakistan-India, the Myanmar-India and the Turkmenistan-Afghanistan-Pakistan-India to deliver.
According to tough-talking sector observers, the first one has an American negative influence on it, the second seems to be lost to Chinese efforts, while the third is losing to its preferred sister project moving toward Russia on its journey to the more lucrative market of Europe, giving leverage to Moscow over Brussels in energy matters.
Dashing any hopes of salvaging the Myanmar-India gas pipeline project, the Oil and Natural Gas Corporation Limited, ONGC – Videsh Limited or OVL scrapped the project in the footsteps of the Gas Authority of India Limited, GAIL. R S Butola, Managing Director of OVL said in New Delhi on May 14: “Since Bangladesh has disagreed to our proposal, the project is now becoming a costly affair while China is trying hard to procure gas from Myanmar through a pipeline because the country has been suffering from a huge energy crisis for long.”
He ruled out any further bid to get back the pipeline project without a cost-benefit analysis. Such a delayed scenario for pipelines leaves the door wide open for imports of gas through ports. The Indian west coast is already dotted with ports which have emerged as leading container handlers with overstretched capacity and the time is ripe for the eastern ports of Kolkota, Haldia and Paradeep to take the initiative to grab this golden opportunity to become a hub of gas imports to meet the energy needs of the parent state, and for the onward transport to other parts of the country.
Usually, it will cost around USD 500 million to equip each port with a re-gasification terminal and a number of years of construction before gas starts flowing to consumers, but pundits offer a new pioneering working model showing a simple way out. With tailor-made delivery-driven solutions catering to exponentially increasing demands for gas, there are technologically advanced vessels which have the facility to re-gasify LNG onboard and discharge natural gas into the pipeline system through an “Energy Bridge” process. The time frame for opening the tap to consumers for this unique way of the re-gasification equipped vessels docking at the ports needs just a year from the time the final decision is taken to when work starts to install various discharge points like a buoy (deepwater port), a turret (shallow water port) or quayside.
Moreover, this also takes care of concerns of vocal environmentalists who have been campaigning against new terminals aimed to boosting imports of LNG. One market expert on India predicted that the move can lead to frenzied investment from abroad in Bengal for constructing short delivery pipelines to industrial units across the region. Calling it “the financial backbone of the future for Bengal (an eastern Indian state),” which is a state striving to transform its poor agro-economy into an industry powered financial giant in the coming years, the expert said in Brussels, “The state can contribute with tax rebates during high risk initial phases with applicant shipping companies committing to help in getting gas contracts at affordable prices.” Time will show if the industry and the state can take advantage of this opportunity to agree on terms of development of gas inlets and beyond.
Written for New Europe, the European Weekly on May 19, 2007 - Issue : 730
Power shortages leading to blackouts are already taking their toll on production, and then the cumulative effect is filtering down to export markets. That’s the scene blurring grand visions of making India a manufacturing hub to alleviate poverty, which keeps more than two-thirds of the rural population engaged in a vicious cycle of an agricultural sector dependent on weather unpredictability.
With an economic boom touching nine percent over the last few years showing no sign of slowing down, India’s insatiable hunger for energy has not been matched by a proportionate increase in supply over the years. Estimates point that India’s energy needs are set to grow by 40 percent, moving it from sixth slot to fourth position in the world’s top consuming nations by 2012.
“Cleaner burning and more efficient than coal,” coupled with the fact that tonnes of stranded gas around the world are just looking for a market, natural gas seems to be the answer to the ever-increasing demand for power in the present Indian environs, where the ways and means to provide sustainable and reliable solutions are far from clear.
Government figures show that the country’s domestic gas supply is 65 million standard cubic metres per day, while demand stands at 231 mmscmd and the projections put it to rise to 313 mmscmd by 2011-2012. India’s Planning Commission in its approach paper to its 11th Five-Year Plan that an ongoing sequence since it was launched five decades ago identified that among other factors, “... above all, power supply are not comparable to those prevalent in our competitor countries.”
Warning that, “... this gap must be filled within the next five to 10 years if our enterprises are to compete effectively,” the paper stressed that, today, Indian companies are not asking for state protection but at least, “expect a level playing field.” It may be noted that although industrial units are savvy about their own power plants, the acute lack of feeding fuel remains a major stumbling block. With focus shifting to cleaner industrialisation, there is a gas era ready to come of age, but latest government figures show the country failed to import only a third of the gas it wanted in 2006-2007.
One of the major reasons is the inadequate infrastructure in the country to handle gas imports as only two of the planned four terminals for LNG (Liquefied Natural Gas) re-gasification viz. Shell’s Hazira terminal and Petronet’s Dahej terminal, are operating while the Kochi terminal and the Dabhol are yet to get commissioned. These special terminals are needed as gas is shipped in liquid form and needs to be re-gasified when the ship berths. Lack of such specialised terminals left not only the power sector but also the fertilizer sector literally gasping for gas.
The geo-political situation around the world has cast its long dark shadows on the Indian government’s options to get international pipeline projects like the Iran-Pakistan-India, the Myanmar-India and the Turkmenistan-Afghanistan-Pakistan-India to deliver.
According to tough-talking sector observers, the first one has an American negative influence on it, the second seems to be lost to Chinese efforts, while the third is losing to its preferred sister project moving toward Russia on its journey to the more lucrative market of Europe, giving leverage to Moscow over Brussels in energy matters.
Dashing any hopes of salvaging the Myanmar-India gas pipeline project, the Oil and Natural Gas Corporation Limited, ONGC – Videsh Limited or OVL scrapped the project in the footsteps of the Gas Authority of India Limited, GAIL. R S Butola, Managing Director of OVL said in New Delhi on May 14: “Since Bangladesh has disagreed to our proposal, the project is now becoming a costly affair while China is trying hard to procure gas from Myanmar through a pipeline because the country has been suffering from a huge energy crisis for long.”
He ruled out any further bid to get back the pipeline project without a cost-benefit analysis. Such a delayed scenario for pipelines leaves the door wide open for imports of gas through ports. The Indian west coast is already dotted with ports which have emerged as leading container handlers with overstretched capacity and the time is ripe for the eastern ports of Kolkota, Haldia and Paradeep to take the initiative to grab this golden opportunity to become a hub of gas imports to meet the energy needs of the parent state, and for the onward transport to other parts of the country.
Usually, it will cost around USD 500 million to equip each port with a re-gasification terminal and a number of years of construction before gas starts flowing to consumers, but pundits offer a new pioneering working model showing a simple way out. With tailor-made delivery-driven solutions catering to exponentially increasing demands for gas, there are technologically advanced vessels which have the facility to re-gasify LNG onboard and discharge natural gas into the pipeline system through an “Energy Bridge” process. The time frame for opening the tap to consumers for this unique way of the re-gasification equipped vessels docking at the ports needs just a year from the time the final decision is taken to when work starts to install various discharge points like a buoy (deepwater port), a turret (shallow water port) or quayside.
Moreover, this also takes care of concerns of vocal environmentalists who have been campaigning against new terminals aimed to boosting imports of LNG. One market expert on India predicted that the move can lead to frenzied investment from abroad in Bengal for constructing short delivery pipelines to industrial units across the region. Calling it “the financial backbone of the future for Bengal (an eastern Indian state),” which is a state striving to transform its poor agro-economy into an industry powered financial giant in the coming years, the expert said in Brussels, “The state can contribute with tax rebates during high risk initial phases with applicant shipping companies committing to help in getting gas contracts at affordable prices.” Time will show if the industry and the state can take advantage of this opportunity to agree on terms of development of gas inlets and beyond.
Written for New Europe, the European Weekly on May 19, 2007 - Issue : 730
“Enough is Enough,” warns Morgantini
On the occasion of “40 years of occupation and no end in sight” for the Palestinian people, Luisa Morgantini, the Vice President of European Parliament last week spoke at length to Tejinder Singh (Tito), strongly denouncing the Israeli’s indiscriminate attacks against civilians as representing a serious breach of the principles of the Geneva Convention amounting to a war crime and called for an international UN force to protect civilians.
The Italian firebrand MEP said: “It’s very important to have one (UN force) but not forever. We need international UN peacekeeping troops to be sent to Gaza and West Bank. The international community has a duty to protect civilians, to stop the Israeli occupation of Palestinian territories, put an end to house demolitions and the destruction of infrastructure.”
Calling the situation as “a tragedy for both Palestinians and Israelis if there is not a rapid solution,” Morgantini said, “This month is 40 years of occupation and the Israeli occupation of West Bank and Gaza is extremely cruel and has really taken away freedom of Palestinian people with the Wall which in the beginning was build for security reasons, blocking the people; it’s a Wall that penetrates deep inside the Palestinian territories and takes away land from what should be a Palestinian state, the fertile land of the villages.”
Portraying a factual image of Israel as a “divided society,” she said: “On the other hand, Israeli society is facing a lot of problems including corruption, imagine President of the country being accused of rape, one of the ministers also accused of rape and many accusations of corruption.”
Stressing the importance of mutual trust and recognition to find a lasting solution to the ongoing sanguinary crisis, Morgantini called the international community “to recognise the democratically elected government of Palestine and to support the efforts made by all Palestinian political forces and President Mahoumud Abbas in their efforts to stop Palestinian militia groups firing rockets on Israeli towns and people.”
Accepting the fact that there are elements in Palestinian society that need taming she said, “Launching rockets is an criminal act on civilian population but the Israelis are responding to these acts through collective punishment, killing children, families, destroying homes and above all putting Palestinians in the jails.”
The Palestinian elections were held in a free and fair democratic manner and the outcome must be respected by law-abiding democratic governments argued Morgantini saying, “After 40 years the occupation continues, we have been talking about a two-state two-people solution since 1980 and we still have not even recognised a democratically-elected Palestinian government,” she said, calling for the EU to “show that it truly believes in international law.”
About the upcoming Quartet meeting, MEP said, “The real player in Middle East is United States. If it’s true what Condoleezza Rice is saying now that Palestinian state should exist along with Israel, then I am sure that Israeli government will accept and start to discuss seriously on negotiations.” “Normally Israelis say that there is no partner on Palestinian side for peace talks but as a matter of fact, President Abbas has been elected by the Palestinians on a clear platform: no violence, Palestinian state and peace with Israel. So Abbas is quite ready to have negotiations and Palestinian government is ready too now. The only way is to convince the Israeli government that it’s in their interests that they have to make peace.” “Palestinians have a Unity government based on a programme that clearly states that the government recognise agreements signed by PLO with recognition of occupied territories and a cease fire,” she said.
Asked to comment on Israel’s withholding of Palestinian customs duties, Morgantini urged the EU and the Quartet to force Israel to return the funds confiscated from Palestine. MEP lambasted Israel saying, “It is unacceptable that Israel is still withholding Palestinian tax and customs revenues and aggravating the Palestinian humanitarian crisis.” “The funds must be immediately transferred,” she demanded.
She commented, “In the European parliament while discussing Darfur, members are demanding sanctions against Sudanese government. What about sanctions against Israeli government which is violating human rights everyday and there are 11,000 Palestinian prisoners among them 370 children and 200 women?” Saying, “Gaza is a total prison,” Morgantini cited the instance of the border opening with Egypt “for only 74 days out of 365 days last year.”
Morgantini demanded the need for using Article two of the EU-Israel Association Agreement, according to which, in the case of violations of human rights the agreement should be suspended and she pointed that there was “no doubt about the human rights violations committed by the Israeli government.”“Enough is enough,” MEP Morgantini concluded urging the Europeans to step out of “guilt consciousness of the Holocaust,” and step forward for values of “justice and freedom for everyone” and to be “very honest with the Israeli government.”
Written for New Europe, the European Weekly on June 9, 2007 - Issue : 733
The Italian firebrand MEP said: “It’s very important to have one (UN force) but not forever. We need international UN peacekeeping troops to be sent to Gaza and West Bank. The international community has a duty to protect civilians, to stop the Israeli occupation of Palestinian territories, put an end to house demolitions and the destruction of infrastructure.”
Calling the situation as “a tragedy for both Palestinians and Israelis if there is not a rapid solution,” Morgantini said, “This month is 40 years of occupation and the Israeli occupation of West Bank and Gaza is extremely cruel and has really taken away freedom of Palestinian people with the Wall which in the beginning was build for security reasons, blocking the people; it’s a Wall that penetrates deep inside the Palestinian territories and takes away land from what should be a Palestinian state, the fertile land of the villages.”
Portraying a factual image of Israel as a “divided society,” she said: “On the other hand, Israeli society is facing a lot of problems including corruption, imagine President of the country being accused of rape, one of the ministers also accused of rape and many accusations of corruption.”
Stressing the importance of mutual trust and recognition to find a lasting solution to the ongoing sanguinary crisis, Morgantini called the international community “to recognise the democratically elected government of Palestine and to support the efforts made by all Palestinian political forces and President Mahoumud Abbas in their efforts to stop Palestinian militia groups firing rockets on Israeli towns and people.”
Accepting the fact that there are elements in Palestinian society that need taming she said, “Launching rockets is an criminal act on civilian population but the Israelis are responding to these acts through collective punishment, killing children, families, destroying homes and above all putting Palestinians in the jails.”
The Palestinian elections were held in a free and fair democratic manner and the outcome must be respected by law-abiding democratic governments argued Morgantini saying, “After 40 years the occupation continues, we have been talking about a two-state two-people solution since 1980 and we still have not even recognised a democratically-elected Palestinian government,” she said, calling for the EU to “show that it truly believes in international law.”
About the upcoming Quartet meeting, MEP said, “The real player in Middle East is United States. If it’s true what Condoleezza Rice is saying now that Palestinian state should exist along with Israel, then I am sure that Israeli government will accept and start to discuss seriously on negotiations.” “Normally Israelis say that there is no partner on Palestinian side for peace talks but as a matter of fact, President Abbas has been elected by the Palestinians on a clear platform: no violence, Palestinian state and peace with Israel. So Abbas is quite ready to have negotiations and Palestinian government is ready too now. The only way is to convince the Israeli government that it’s in their interests that they have to make peace.” “Palestinians have a Unity government based on a programme that clearly states that the government recognise agreements signed by PLO with recognition of occupied territories and a cease fire,” she said.
Asked to comment on Israel’s withholding of Palestinian customs duties, Morgantini urged the EU and the Quartet to force Israel to return the funds confiscated from Palestine. MEP lambasted Israel saying, “It is unacceptable that Israel is still withholding Palestinian tax and customs revenues and aggravating the Palestinian humanitarian crisis.” “The funds must be immediately transferred,” she demanded.
She commented, “In the European parliament while discussing Darfur, members are demanding sanctions against Sudanese government. What about sanctions against Israeli government which is violating human rights everyday and there are 11,000 Palestinian prisoners among them 370 children and 200 women?” Saying, “Gaza is a total prison,” Morgantini cited the instance of the border opening with Egypt “for only 74 days out of 365 days last year.”
Morgantini demanded the need for using Article two of the EU-Israel Association Agreement, according to which, in the case of violations of human rights the agreement should be suspended and she pointed that there was “no doubt about the human rights violations committed by the Israeli government.”“Enough is enough,” MEP Morgantini concluded urging the Europeans to step out of “guilt consciousness of the Holocaust,” and step forward for values of “justice and freedom for everyone” and to be “very honest with the Israeli government.”
Written for New Europe, the European Weekly on June 9, 2007 - Issue : 733
Banana sector gets slippery
Judgment day arriving as industry awaits Kroes’ moves
Investigations take time and when it comes to investigating in environs full of banana peels, the going gets slippery, slowing down proceedings further. There was, however no slip last week on the part of Jonathan Todd, commission spokesman for competition commissioner Neelie Kroes as he told journalists, “Anti-trust inquiry is ongoing.”
Todd was replying to a question about the latest status of a “cartel probe” launched two years ago into a suspected cartel of banana wholesalers. In 2005, Kroes team had raided the offices of Europe’s largest fruit distributors after Chiquita, the world’s biggest producer of bananas blew the whistle on an alleged cartel in the European banana markets.
At the time, Fyffes of Ireland, Dole and Del Monte of the US had admitted that they had been among the targets of the raids while the European commission had confirmed the “unannounced inspections” at the premises of several producers and distributors of bananas and pineapples in Germany, Belgium, the United Kingdom and Ireland.
“The Commission has reason to believe that the companies concerned may have violated Article 81 of the EC Treaty, which prohibits price fixing and market sharing practices,” the commission statement had said clarifying that raids did not mean that the targeted companies are guilty adding that a full-scale inquiry would be carried out.
The investigation was launched at the instance of Chiquita, based in Cincinnati in the US when it had it had informed the EU competition authorities after the management became aware that several of its employees had been sharing price information with rival companies for “many years.”
Commenting on the inquiry, reliable sources in the European commission and European banana industry sector told New Europe that the regulators are targeting the five biggest banana companies – Chiquita, Del Monte and Dole of the United States, plus Noboa of Ecuador and Fyffes of Ireland for an illegal cartel activity.
The sources also confirmed recent media reports that at the end of two years the European commission has more concrete information and formal charges may be initiated before the end of the current year.
Although Commissioner Kroes has broken many records during her tenure for imposing fines on cartels, the market observers feel that the fines, if imposed may stay within the precedent cases of about 10 percent of annual sales. Moreover, it may take months before the case comes to an end as the accused firms would have several months time period to defend themselves.
One market pundit alleged that the timing is coinciding with the ongoing transatlantic banana war which got reignited last year when Ecuador was joined by the US, Columbia and Panama to open another tug-of-war a decade later.
December 15, 2006 saw the first day of the proceedings at Geneva of revival of the “1990s banana wars” with the then-winner Ecuador coming back to haunt the European Union. Ecuador, the world’s largest banana exporter, complained to the WTO against the EU’s single tariff of 176 Euro that came into force on January 1, 2006, terming it “high.”
Last year, while negotiating for a single tariff system to modify its complex web of duties and quotas for imports, the European Commission had suggested EU duties of 230 Euro and then scaling them down to 187 Euro, but WTO panels had rejected the proposals arguing that those were discriminatory against Latin American (Latam) nations. Out of that deadlock emerged the figure of 176 Euro, but the conflict simmered on.
Even after the introduction of the new EU single tariff system, there was widespread dissatisfaction, and Norwegian Foreign Minister Jonas Gahr Stoere got into the driver’s seat to find a political solution based on a thorough monitoring of the EU banana imports and various price systems in force.
But, after waiting nearly for a year, Ecuador decided to go ahead with the WTO route and on November 23, 2006 was joined by Colombia as a third party. Panama and the US followed and more countries are set to join in the fray according to sector insiders.
The EU’s current banana import policy significantly differentiates access treatment as a tariff-quota volume of 775,000 tonnes is exclusively reserved for bananas of ACP origin. ACP bananas within the quota enter duty-free (i.e., at a 176 Euro/tonne margin of preference), with unlimited ACP over-quota access authorised at a tariff of 176 Euro/tonne. On the other hand, an “autonomous” tariff of 176 Euro/tonne (a rate more than double the previously-applicable rate of 75 Euro/tonne) applies to all other bananas.
Bananas are the most important agricultural product in Ecuador, and its exports account for 25 percent of all Ecuador’s agricultural exports. Some 97 percent of all banana output is aimed for the European market. On the other hand, in Europe it is a “sensitive” commodity and there is a protection regime for the sector.
While bananas grown within the bloc account for only 16 percent of the total EU supply, production is important to the Spain’s Canary Islands, the French overseas departments of Martinique and Guadeloupe and Portugal’s Madeira and Azores islands.
Europeans eat some 4.6 million tonnes of bananas every year, making the bloc the world’s biggest banana market. Over two-thirds of the fruits consumed come from Latin America and a further 17 percent from Africa and Caribbean countries.
Written for New Europe, the European Weekly on June 16, 2007 - Issue : 734
Investigations take time and when it comes to investigating in environs full of banana peels, the going gets slippery, slowing down proceedings further. There was, however no slip last week on the part of Jonathan Todd, commission spokesman for competition commissioner Neelie Kroes as he told journalists, “Anti-trust inquiry is ongoing.”
Todd was replying to a question about the latest status of a “cartel probe” launched two years ago into a suspected cartel of banana wholesalers. In 2005, Kroes team had raided the offices of Europe’s largest fruit distributors after Chiquita, the world’s biggest producer of bananas blew the whistle on an alleged cartel in the European banana markets.
At the time, Fyffes of Ireland, Dole and Del Monte of the US had admitted that they had been among the targets of the raids while the European commission had confirmed the “unannounced inspections” at the premises of several producers and distributors of bananas and pineapples in Germany, Belgium, the United Kingdom and Ireland.
“The Commission has reason to believe that the companies concerned may have violated Article 81 of the EC Treaty, which prohibits price fixing and market sharing practices,” the commission statement had said clarifying that raids did not mean that the targeted companies are guilty adding that a full-scale inquiry would be carried out.
The investigation was launched at the instance of Chiquita, based in Cincinnati in the US when it had it had informed the EU competition authorities after the management became aware that several of its employees had been sharing price information with rival companies for “many years.”
Commenting on the inquiry, reliable sources in the European commission and European banana industry sector told New Europe that the regulators are targeting the five biggest banana companies – Chiquita, Del Monte and Dole of the United States, plus Noboa of Ecuador and Fyffes of Ireland for an illegal cartel activity.
The sources also confirmed recent media reports that at the end of two years the European commission has more concrete information and formal charges may be initiated before the end of the current year.
Although Commissioner Kroes has broken many records during her tenure for imposing fines on cartels, the market observers feel that the fines, if imposed may stay within the precedent cases of about 10 percent of annual sales. Moreover, it may take months before the case comes to an end as the accused firms would have several months time period to defend themselves.
One market pundit alleged that the timing is coinciding with the ongoing transatlantic banana war which got reignited last year when Ecuador was joined by the US, Columbia and Panama to open another tug-of-war a decade later.
December 15, 2006 saw the first day of the proceedings at Geneva of revival of the “1990s banana wars” with the then-winner Ecuador coming back to haunt the European Union. Ecuador, the world’s largest banana exporter, complained to the WTO against the EU’s single tariff of 176 Euro that came into force on January 1, 2006, terming it “high.”
Last year, while negotiating for a single tariff system to modify its complex web of duties and quotas for imports, the European Commission had suggested EU duties of 230 Euro and then scaling them down to 187 Euro, but WTO panels had rejected the proposals arguing that those were discriminatory against Latin American (Latam) nations. Out of that deadlock emerged the figure of 176 Euro, but the conflict simmered on.
Even after the introduction of the new EU single tariff system, there was widespread dissatisfaction, and Norwegian Foreign Minister Jonas Gahr Stoere got into the driver’s seat to find a political solution based on a thorough monitoring of the EU banana imports and various price systems in force.
But, after waiting nearly for a year, Ecuador decided to go ahead with the WTO route and on November 23, 2006 was joined by Colombia as a third party. Panama and the US followed and more countries are set to join in the fray according to sector insiders.
The EU’s current banana import policy significantly differentiates access treatment as a tariff-quota volume of 775,000 tonnes is exclusively reserved for bananas of ACP origin. ACP bananas within the quota enter duty-free (i.e., at a 176 Euro/tonne margin of preference), with unlimited ACP over-quota access authorised at a tariff of 176 Euro/tonne. On the other hand, an “autonomous” tariff of 176 Euro/tonne (a rate more than double the previously-applicable rate of 75 Euro/tonne) applies to all other bananas.
Bananas are the most important agricultural product in Ecuador, and its exports account for 25 percent of all Ecuador’s agricultural exports. Some 97 percent of all banana output is aimed for the European market. On the other hand, in Europe it is a “sensitive” commodity and there is a protection regime for the sector.
While bananas grown within the bloc account for only 16 percent of the total EU supply, production is important to the Spain’s Canary Islands, the French overseas departments of Martinique and Guadeloupe and Portugal’s Madeira and Azores islands.
Europeans eat some 4.6 million tonnes of bananas every year, making the bloc the world’s biggest banana market. Over two-thirds of the fruits consumed come from Latin America and a further 17 percent from Africa and Caribbean countries.
Written for New Europe, the European Weekly on June 16, 2007 - Issue : 734
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