Korean talks were a disaster

Analysis by John Feffer

Sept. 6— It is a testament to the absurdly low expectations attached to the diplomatic abilities of both North Korea and the United States that pundits have avoided the obvious conclusion concerning the recently concluded Six-Party Talks in Beijing.

They were a disaster.

Here’s the rub, though: the hardliners in Washington got exactly what they wanted and may get hoisted by their own hubris as a result.

The two indicators frequently cited as evidence that the talks went smoothly are: none of the six delegations stormed out of the meeting hall, and all sides agreed to meet again within two months. For a brief moment the day after the delegates went home, North Korea told the truth about the talks — that they were a failed effort and probably a waste of time — before returning to a more open-ended pledge to continue participating. Without any sign of compromise from Washington, though, North Korea is pushing forward with its nuclear program along with the threat to test a nuclear weapon.

Hardliners such as Defense Secretary Donald Rumsfeld and the State Department’s John Bolton are probably greeting this result with little jigs of exultation. Pyongyang couldn’t have followed their script any better. Its skepticism concerning future talks has made North Korea look militantly ham-fisted. Russia and China are ever more frustrated with their erstwhile ally. And a nuclear test, should North Korea be so technologically equipped or politically stupid to hold one, would be the checkered flag to signal the final lap toward regime change.

The hardliners in Washington have made no secret of their distaste for negotiations with North Korea and so contrived to ensure that the Six Party talks would fail. For instance, they made sure that the talks would not involve any negotiations. Negotiations require give and take, and despite rumors floated in the press about potential flexibility on a non-aggression pact or a package of economic incentives, there was no wiggle room in the US position in Beijing.

This uncompromising stance is all the more remarkable given that both sides are talking about roughly the same elements of a deal: ending North Korea’s nuclear program in exchange for various economic, political, and security guarantees. The chief disagreement, at least on the surface, concerns sequence. In other words, should North Korea freeze its program first or should the United States offer security guarantees first? That the two sides couldn’t begin to address the issue of sequence in Beijing suggests that the talking cure is not fully subscribed to by either side.

The Six Party Talks were flawed as well because the particular multilateral format only encouraged North Korea’s infamous “cornered badger” behavior. Outnumbered five to one over the validity of its nuclear program, North Korea couldn’t effectively marshal what remains of comradely feeling in China and Russia. Nor could it exploit the obvious fact that the United States can only count on limited support from one country in the region (Japan) for a more aggressive solution to the stand-off. The informal discussions, particularly between the US and North Korea, were scant. The formality of the presentations precluded much in the way of creative thinking (for example, a joint economic deal from Russia and South Korea) or creative pressure (on either North Korea or the United States to be more flexible).

China’s role as convener of the talks was, of course, a plus. However, it has come up against a stubborn law of diplomacy: you can bring six parties to the table, but you can’t force them to compromise. This was the primary flaw of the meeting. Hardliners on both sides have been, at some level, happy to pursue “talks without negotiations.” North Korea wants more time to develop its nuclear program. The United States wants more time to see if the government in Pyongyang will collapse. To move from talks to negotiations, both sides will have to be pressured into more flexible positions.

North Korea’s reputation in the world these days is not exactly sterling. The Bush administration wanted, through the Six Party Talks, to isolate the country further by demonstrating that it can’t play well with five others. To do so, however, the US delegation had to act just as uncompromisingly. This lack of diplomacy prompted China to declare after the talks that US policy was a “main problem,” a sign that the hardliners in Washington may well have overreached themselves. If another round of talks does take place within the next two months, the hardliners might not be able to pull of a repeat performance.

The flaws in the structure and outcome of the Six Party Talks should not lead to the conclusion that engagement and diplomacy are failed options. Neither side has yet pursued engagement, not since relations took a turn for the worse when George W. Bush assumed office. Rather, responsibility for the hexagonal headache in Beijing should be attributed to the failures of non-engagement. Diplomacy is still the best method of resolving the current crisis. We just haven’t seen any of it yet.

John Feffer, editor of PowerTrip: U.S. Unilateralism and Global Strategy After September 11,, writes regularly for Foreign Policy in Focus. He is the author of the forthcoming North Korea, South Korea: U.S. Policy at a Time of Crisis (Seven Stories Press).

Source: Counterpunch

Catholic bishops in Latin America speak out against Free Trade Area

By Raúl Pierri

Montevideo, Uruguay, Sept. 4 (IPS)— The Free Trade Area of the Americas (FTAA) looks less like a true regional integration project than a “neo-colonialist’’ plan that will make poor communities even poorer and will not respect national sovereignty, said the Catholic bishops of the members of South America’s largest trade bloc.

“What we condemn is that the only aim of the project is to increase trade flows, regardless of whether or not it devastates everything and everyone in its path,’’ the secretary-general of the bishops’ conference of Uruguay, Bishop Pablo Galimberti of the southern Uruguayan city of San José, said on Thursday.

The Catholic bishops of the countries of South America’s Mercosur trade bloc — Argentina, Brazil, Paraguay and Uruguay — and the bloc’s associate members Bolivia and Chile met Tuesday through Thursday in Montevideo, the Uruguayan capital, to discuss the challenges of integration in Latin America and the “ethical and moral’’ aspects of the creation of the FTAA.

The initiative promoted by the United States will create a free trade zone made up of 34 countries — all of the nations in the Americas with the exception of Cuba — with a total population of 800 million people and a combined Gross National Product (GNP) of over $11 billion by 2005.

The main objections to the FTAA raised by the bishops were that it will benefit the richest countries — like the United States and Canada — at the expense of the less competitive members, and that it will consolidate the hold of ‘’unfettered neo-liberalism’’ on the entire region.

“Christian ethics and the Christian vision encompass everything, not just the moral aspects,’’ said Galimberti. ‘’They encompass the spiritual as well as the economic. We do not separate out religious and social aspects..’’

In a statement, the bishops said the creation of the FTAA would have ‘’grave consequences’’ due to “the excessive disproportion of the competitive capacities of the countries, some of which have very strong, developed economies while others are weak.

“This initiative will foment the concentration of economic power in a few hands, favouring the formation of monopolies and oligopolies, which will end up imposing their hegemony over governments, especially in the weakest countries in the Americas.

“Rather than integration, this could involve neo-colonialism, with a negative impact on local communities...The chief aim of an initiative like the FTAA should be to promote the common good and solidarity between nations, and not merely to search for the greatest advantage for just a few,’’ they said.

The bishops also expressed concern over the future of indigenous and rural communities, “which in this system would run the risk of being displaced,’’ from land rich in natural resources, for example.

In addition, they said the strategic natural resources of poor nations “should not be susceptible to appropriation by private interests.

“A true process of integration in the Americas should be based on a continent-wide policy that takes into account human rights and the principles of sovereignty, justice, solidarity and respect for the cultural identities of nations,’’ said the statement.

The secretary-general of Brazil’s bishops’ conference, Bishop Odilo Scherer of Sao Paulo, told IPS that the Brazilian Catholic Church is working with non-governmental organizations on a campaign aimed at raising awareness about the FTAA, which will include another “people’s referendum’’ in which Brazilians will be asked what they think about the future free trade area.

“We will hold an unofficial popular referendum this month to allow Brazilians to express their opinions about the FTAA. Our big concern is human beings, who should always take top priority,’’ he said.

In a similar “referendum’’ held in September 2002, 10 million Brazilians said they were opposed to the free trade area, according to the organizers.

The president of Argentina’s bishops’ conference, Eduardo Mirás, stressed the negative impact that the prescriptions of the multilateral lending institutions have had on his crisis-stricken nation.

“Our countries need help, without a doubt, but they don’t need an invasion of our sovereignty, which also implies a loss of our identity. By meddling in our educational programs, for example, they are undermining the free determination of nations,’’ said Mirás, the archbishop of the eastern Argentine city of Rosario.

The bishops who met in Montevideo did not agree on any concrete common strategy, nor did they decide to discuss their point of view with their respective governments.

‘’We are making closer contact with political leaders, but we are not a political party. This statement simply has the objective of helping to form the faith of Christians, with a social dimension,’’ said Galimberti.

The declaration signed Sept. 4 by the bishops of the Mercosur nations and their associates Bolivia and Chile concurs with the pastoral letter Ecclesia in America that Pope John Paul II made public in Mexico in 1999.

Ecclesia in America stated that more and more, in many countries of the Americas, a system known as “neo-liberalism” prevails; based on a purely economic conception of man, this system considers profit and the law of the market as its only parameters, to the detriment of the dignity of and the respect due to individuals and peoples.

“At times this system has become the ideological justification for certain attitudes and behavior in the social and political spheres leading to the neglect of the weaker members of society. Indeed, the poor are becoming ever more numerous, victims of specific policies and structures which are often unjust.’’

The views of the Roman Catholic Church are of great significance in the Americas, which is home to 528 billion Catholic faithful, nearly half of the world’s 1.1 billion Catholics, according to statistics from the Vatican.

Nuclear pressure could backfire, Iran warns US

By George Jahn

Vienna, Austria, Sept. 8— Pressure from the US and other countries gathering for a UN atomic energy meeting this week could aggravate tensions instead of clearing up concern about Iran’s suspected nuclear activities, Tehran’s delegate said in a blunt warning yesterday.

Washington accuses Iran of working on a secret nuclear weapons program. Iran insists its programs are devoted only to generating electricity. Tehran’s nuclear intentions are the main item at a meeting of the International Atomic Energy Agency (IAEA) today in Vienna.

The UN agency’s board of governors will be debating how to react to an IAEA report revealing traces of weapons-grade uranium at a nuclear facility at Natanz, 300 miles south of Tehran. The Iranians say the second-hand centrifuge components in question were contaminated before they were purchased by Tehran.

The Bush administration decided late last week not to ask the meeting to endorse a resolution that would have found Iran in noncompliance of its IAEA obligations, an apparent victory for Tehran. Member states found in noncompliance can be reported to the UN Security Council, which can take steps ranging from criticism to sanctions.

Instead, the resolution, which is still being drafted and must be approved by the board, is likely to call on Iran to come up with answers to questions raised in the report and provide full disclosure of its program.

The resolution could also set a deadline for Iran and warn that if it does not, it will be declared in noncompliance, diplomats said before the meeting.

Kenneth Brill, the chief American IAEA delegate, declined to comment on what the US was seeking. But he and other board members believe there is an effort by Iran, “to evade international obligations and to seek the capacity to build nuclear weapons,” he said. “The majority of board members will want to see Iran ... enhance its co-operation” and “provide the answers to all the questions that are outstanding,” he said.

In Tehran, a Foreign Ministry spokesman, Hamid Reza Asefi, said the IAEA did not share the view of the US, “which pursues an extremist position. Its behavior is politically motivated.” And in Vienna, Iran’s chief IAEA delegate warned both the US and the board to back away from excessive pressure on his country.

While not going into specifics, Ali Akbar Salehi warned of “unexpected or surprising consequences” should the Iranian leadership decide that board demands were too harsh.

Anthony Cordesman, a senior analyst with the Washington-based Center for Strategic and International Studies, also said too much pressure on Iran could backfire.

“You may make a country halt, but you may also push it into a more institutionalized covert [nuclear weapons] program,” he said. “If you push too hard in the nuclear dimension, you can simply end up making a country shift toward another program of weapons of mass destruction.”

Cordesman, in a recent survey of Iran’s nuclear activities, wrote that Iran wants to “develop a complete nuclear fuel cycle,” from mining its own uranium to enriching the ore, for its energy projects.

“In this guise, it seeks to obtain whole facilities, such as a uranium conversion facility, that, in fact, could be used ... in support of efforts to produce fissile material needed for a nuclear weapon,” he wrote.

Under international pressure, Iran offered last month to negotiate on a protocol obliging it to open its nuclear program to IAEA perusal. Salehi said that offer still stood — but indicated it could be withdrawn.



Source: Independent (UK)

World Bank urges rich to ‘go first’ on Free Trade

By Emad Mekay

Washington, DC, Sept. 4 (IPS)— As delegates begin gathering in the Mexican sea resort of Cancun for talks aimed at liberalizing world trade, experts are warning the meeting will fail without substantial moves by rich nations, whose positions are largely now blamed for the chronically stalled negotiations.

“They are the dominant players and account for two-thirds of the global market,” said Nicolas Stern, chief economist of the World Bank, on Wednesday.

“They could show leadership by reducing agricultural protection, cutting high tariffs, and ensuring that the poorest countries have access to affordable medicines on the same terms as bigger developing countries,” he told reporters.

A leading business group also called on the US administration to lead the way if it wants to see real development at next week’s high profile meeting on free trade of the World Trade Organization (WTO).

The Washington-based Committee for Economic Development (CED) on Wednesday urged the Bush administration to adopt vital policy reforms.

They include de-linking agricultural subsidies from prices and production while opening agricultural markets everywhere, and eliminating all tariffs and non-tariff barriers in both manufacturing and services.

Also on Wednesday, the World Bank released its annual ‘Global Economic Prospects’ report with a fervent call on rich nations to work towards a trade deal that could spur global growth and reduce poverty in the world.

It was published prior to a crucial meeting of some 147 trade ministers in Cancun, Mexico, Sept. 10-14. The gathering is an interim assessment of global trade talks that are scheduled to end by Jan. 1, 2005.

But the WTO talks have been marked by sharp differences between rich and poor countries.

Those differences made a failure of the organization’s meeting in December 1999, which ended without an agreement over rules for starting a new round of global trade talks.

WTO members eventually launched new talks in 2001 in Doha, Qatar, only a few months after the Sept. 11, 2001 terrorist attacks on US landmarks.

Disputes revolve around rich nations and economic groupings like the United States, Japan and the European Union (EU) on the one hand and developing countries like Brazil and India on the other.

Among the sticky issues are agriculture trade, tariff reductions on manufactures and drug patents in poor countries.

But CED, the World Bank and other organizations now say the onus lies almost entirely on the United States and other rich nations to lead the way and stop practices that have crippled small farmers and businesses around the world.

“It is time for the United States to break the cycle of low expectations and provide real leadership on trade,” said James D. Robinson III, chairman of CED’s subcommittee on expanding world trade.

“The United States can and must lead the way to progress on agricultural and other issues and guide the WTO towards fully open markets,” he added at a press conference.

Robinson argues that trade talks have been plagued by limited expectations, so that even the smallest gains are often hailed as major victories, while the more significant goals of comprehensive free trade remain illusive.

By going first, Washington would show a clear commitment to the principles of open trade and would challenge its trading partners to respond in kind, he argues.

Lingering inequities in the world’s trading system have, according to the World Bank, dragged down export growth in developing countries and prompted them, especially middle-income countries, to delay trade liberalization and view trade talks with suspicion.

The United States, for example, spends some $50 billion annually on direct support to its agriculture sector alone. Annual cotton subsides to US farmers stand at more than three billion dollars, or three times Washington spends on foreign aid to all of Africa.

This, too, depresses world cotton prices and “crowd(s) out poor but efficient farmers in West Africa” and Brazil, says the Bank.

The international development group Oxfam says the same is happening to Mexican corn farmers.

The United States spends $10 billion of taxpayers’ money each year subsidizing its corn farmers and, in turn, inflating production. Excess corn is then sold at prices below the cost of production — or “dumped” — on Mexican markets, causing corn prices to plummet.

“In the end, Mexico’s 2.5 million corn farmers suffer dearly; in fact, corn prices in Mexico have dropped by 70 percent since 1994,” said Oxfam in a statement Wednesday. Corn is at the heart of Mexico’s diet and culture.

The pattern is being repeated elsewhere.

Japan’s support to its rice producers, for example, amounts to 700 percent of production cost. This, the World Bank says “effectively shuts out exports from Thailand and other producers.”

And direct budget subsidies to producers in the EU cost some $100 billion every year, which depresses world market prices in sugar, dairy, and wheat.

According to a report released Monday by Oxfam, rich countries are also guilty of applying higher tariffs on imports from poor nations than imports from other rich nations, a view that was echoed in the Bank’s ‘Global Economic Prospects.’

Industrialized countries on average charge each other tariffs of about one percent on their imported manufactures but collect as high as five percent from East Asia, six percent from the Middle East and eight percent from South Asia, says Oxfam.

Mongolia, for example, pays nearly the same dollar amount in tariffs to the US government as Norway, although it sells only three percent of the value of goods that the Nordic nation sells in the United States.

“Can anyone argue this system is living up to its development potential for the poor?” asked Richard Newfarmer, economic adviser at the World Bank.

The bank says that progress in Cancun could restore investor confidence and pave the way towards a comprehensive WTO deal that would in turn spur trade and eventually raise incomes around the world.

The Washington-based economic powerhouse estimates that if the rich nations lead in negotiating a fair outcome to the Cancun meeting, an eventual trade deal could produce up to $520 billion in income gains to both rich and poor countries.

That would reduce the number of the world’s poor by as many as 144 million people by 2015.

US policy in Latin America: low-intensity conflict

Jack Nelson-Pallmeyer is an author, professor and longtime member of the Resource Center of the Americas. His books include War Against the Poor (1989), and School of Assassins (2001).

During the 1980s, you described US involvement in Central America as “low-intensity conflict,” and as a war against the poor. You wrote then that low-intensity conflict “is an evolving strategy of counter-revolutionary warfare. It is the nuts-and-bolts means by which the United States is projecting power into the Third World.” Has your analysis changed since the end of the 1980s wars in Central America?

I think it’s evolved. What I’ve tried to talk about in more recent writings is that we need to look at US foreign policy not as static but as constantly evolving in its methods while retaining an essential goal of domination and control.

From 1945–1980, the United States mainly carried out its policy in Latin America by supporting repressive military dictatorships. Beginning in 1980, we saw a second phase where the continuation of repression was necessary, but so was the use of debt as leverage. We have IMF austerity measures that essentially accomplish similarly repressive goals. A war against the poor can be fought with bullets or it can be fought with bankers.

By around 1991, we entered a period of about seven years during which US foreign policy focused on economics — the World Bank and the IMF were strengthened, the World Trade Organization and NAFTA were created.

Beginning about 1998, we saw a remilitarization of US foreign policy, driven mainly by two factors. One factor was the power of the US military-industrial complex. It regarded the end of the cold war as a disaster because it wanted to maintain its power and privilege and huge military budget. And the other is that corporate-led economic globalization destabilized various countries’ economies, leading to remilitarization.

The focus in the 1980s was Central America. Where do you see the focus in the coming decade?

Venezuela, Colombia, Brazil, and other nations in Latin America are economically very important to the United States. Our present foreign policy is guided by a number of factors, one of which is taking control of the world’s oil supplies, wherever they are found. We are seeing very, very intense US involvement in trying to destabilize Venezuela and get control of that country’s oil resources. Oil is also the major reason that we are involved as aggressively as we are in Colombia.

You mentioned Colombia and the current US military involvement in Colombia. Could you elaborate on that and give us your analysis, in a nutshell, of what we are doing there?

I’ve heard a number of people say they worry about Colombia because it may be another Vietnam, and maybe that’s a legitimate fear. But I think more likely the way we need to view Colombia is as another El Salvador…. another El Salvador, but with resources at stake. In El Salvador, the US really didn’t have resources at stake. The US had other battles there—we wanted to make sure that no revolutionary government came to power.

Colombia is a place where the United States has fairly significant economic interests, including oil, and business has been very involved in shaping US policy there. The Colombian government wants to defeat any kind of guerrilla movement and in the guise of doing so -- as in El Salvador -- they are targeting all progressive groups for repression. My big fear is that the US government is conducting a similar kind of war in Colombia as it did in El Salvador, only on a much grander scale. Because Colombia is much bigger, we are committing more resources and we have more at stake economically.

What do you see as the most significant signs of hope you can share.... to give people energy for the future?

This is a time when a lot of us are struggling with the issue of hope. So my first message would be -- if that’s how you’re feeling, that’s okay. I’m 52 years old and I’ve been active a long time, and this is the most difficult political moment that I have lived through, in terms of where our country is, the leadership, the foreign policy, the arrogance of US policy. And in some ways the flag waving, the uncritical patriotism that is being cultivated -- all those things make it a very difficult moment. But within that I do see some signs of hope.

For me the biggest sign of hope is that there are now two superpowers in the world -- the United States and world public opinion. I think the New York Times said this during the Iraq fiasco. Survey after survey after survey in country after country after country reveal that if you ask people the question, “In the next year which country is the most dangerous in the world -- North Korea, Iraq (before the invasion) or the United States,”eighty to ninety percent say the United States.

I’d just like to remind progressive people that we are part of a global majority. Look at the polls -- the vast majority of people in the world see the United States as a bellicose power or a dangerous country. When at times we feel like a very small minority, that’s a really important thing to hold onto.

A second sign of hope for me, as I mentioned earlier, is that in the midst of the horrible reality Latin Americans have faced during the last 40 or 50 years, they have continued to organize. They’ve developed many, many non-governmental organizations, women’s movements, community movements. People understand their own experience in relation to things like free trade agreements and policy. They are beginning to articulate alternatives and they’re certainly committed to working for changes.

A third sign of hope for me is that, though the transition in Latin America from militarized societies to more democratic societies is only partially fulfilled, it would be very hard to put the genie back in the bottle. It’s important that we aspire to authentic democracy because our voices are important. People’s voices are important. People also recognize that even when you replace a military leadership, it doesn’t necessarily mean democracy -- not if you have an economic elite operating under free trade agreements and a World Trade Organization dominated by corporate needs. Those are now the huge constraints on democracy. A lot of our struggles in the next 20 years will be over those issues, as is reflected in the increasing globalization protests already.

Another sign of hope for me would be -- it’s probably too early to predict this -- but I think there’s a reasonable possibility that this administration will go down. Current US foreign policy has resulted in domestic cutbacks, US soldiers being placed in untenable positions; there’s going to be a lot of backlash on that. I think we are on the cusp of a pendulum swing in a direction that will be much more progressive. We have to put all the force of our conviction towards continuing to organize, even when it doesn’t feel like we’re winning.

Source: www.guerillanews.org

IMF achieves too few of its promises, review says

By Emad Mekay

Washington, Sept. 10 (IPS) -- IMF fiscal policy programs, implemented in dozens of borrowing countries across the globe, largely fail to improve budgets and often over-optimistically predict investment and economic growth, says an independent report from the body.

The report, issued late Tuesday by the independent evaluation office (IEO) of the International Monetary Fund, is aimed at helping the IMF improve its management of the programs, under which it gives near obligatory policy advice in return for loans.

Fiscal adjustments include measures like reducing government deficits, cutting expenditures and increasing revenues.

“The fiscal component of IMF programs is a critical part of the overall programs of the fund,’’ said Marcelo Selowsky, assistant director of the IEO, in an interview on Wednesday.

Pushed by their political masters among the Group of Seven (G7) most industrialised nations, the fund and its sister institution, The World Bank, often prescribe large fiscal contractions that they say stimulate economic activity.

Larger IMF-imposed programs have traditionally been based on controlling inflation, selling public assets, deregulating laws and liberalising trade.

But repeated financial crises across the globe, as in Argentina and East Asia in the late 1990s, have sparked heated debate over the effectiveness of the policies of the two institutions.

Critics among civil society groups and economists say forcing such policies on borrowing and often impoverished nations leads to drastic cuts in essential social services — such as education and health — extra charges and loads on poor consumers, and weaken economic growth.

The IEO is appointed by the IMF but works independently. Montek Sigh Ahluwalia, a former Indian finance official, chairs the IEO, which also examined the role of the IMF in recent capital account crises in Brazil, Korea, and Indonesia.

It found that the fund failed to estimate the gravity of the three recent capital account crises and made mistakes as it handled the ensuing economic meltdown in the three countries.

The IEO survey, which covers lending programs from 1993 to 2001, found that, on average, fund programs achieved only about one-half of the projected improvement in fiscal balances.

The success rate was highest for countries in transition, including many in Central and Eastern Europe, and lowest for “non-transition’’ (stable but still developing) countries.

“Fiscal balances on average did not improve through the first two years of the arrangement ... except in the transition economies,” said the report, adding, “shortfalls appear to reflect weak fiscal performance rather than very ambitious fiscal targets.”

Long-term economic development, according to Selowsky, is the sole responsibility of sovereign nations but he said the fund would be “well advised” to open a dialogue with developing nations.

The report also found that measures to cut costs often were not sustained beyond a program’s first year. “Many of the fiscal measures in programs aimed at quickly reducing fiscal deficits exhaust themselves over time or become reversed,’’ it said.

For example, raising value-added (VAT) or social security taxes when the tax base was narrow increased tax evasion. Measures to limit public sector wages were difficult to sustain beyond the program period, the document said.

Improved monitoring would help identify those reversals, it added.

The report cites many examples — including Ecuador — where the impact of measures like controlling spending and raising the VAT was supposed to be monitored, but the social impacts were not measured.

Conditions in the Pakistan program included a target for social and poverty-related spending, but it was not met.

And despite the “good intentions’’ of the Philippines program, which saw the fund’s staff urge authorities “to protect programs directed at poverty reduction in implementing the cuts’,’ the proportion of the population served by various health programs actually declined, the report says.

This, it adds, reflects the absence of clear guidelines about what critical programs must be protected.

The 156-page report also found the fund’s estimates for growth exaggerated.

“Many programs are over-optimistic in projecting growth, especially when programs start from adverse situations. In particular, they are reluctant to project a slowdown in growth and very rarely project negative growth,’’ it said.

Investment growth was often overstated in the fund’s literature associated with lending programs, it added.

The report urged the fund staff to work towards projecting “realistic growth rates’.’

But the cautiously critical report sided with the fund on the charge that it endorses “one-size-fits-all” policies.

It says the accusation that IMF-supported programs are not flexible but force a rigid pattern of fiscal adjustments that are not sensitive enough to changing circumstances was not supported.

The report said that about two-thirds of the programs studied actually underwent revisions to the initial fiscal deficit targets by the completion of the second program review, which occurs at different times in each program.

Earlier, the office, which was set up in July 2001, criticized the fund’s use of loans for prolonged periods of time, saying that they created many problems for the institution as well as for borrowing nations.

Cancun: ‘serpents nest’ surrounded by poverty

By Diego Cevallos

Cancun, Mexico, Sept. 10 (IPS)— This Mexican resort city on the Caribbean coast was all decked out Wednesday for the arrival of 146 trade ministers and their entourages, but in the poor neighborhoods just beyond the luxurious hotels nothing had changed.

Hotels are at 100-percent capacity this week in the “serpents nest,” the English translation of the Maya word “cancún.”

Posters and stickers repeating the slogans “Our life is tourism” and “Take care of Cancun” popped up throughout the city in the last few days, in preparation for the World Trade Organization’s Fifth Ministerial Conference, Sept. 10 to 14.

Giving the 33-year-old Cancun that extra shine are new layers of paint on buildings and recently pruned trees in parks and along avenues.

Every year, more than three million tourists come to this beach town to take in the sun and enjoy the white sands and the turquoise-colored sea. But today its imposing hotels hold thousands of government delegates and civil society representatives attending the WTO official meeting.

Also in Cancun are thousands of activists, who are gathering in parks and plazas, out of view of the heavily guarded official conference venue. These non-governmental organization campaigners are discussing the effects of the neoliberal economic globalisation model now in force, and strategies to change its course.

But the local residents are not reporting many benefits from the event that has filled the city to overflowing. They are complaining.

“There is no way to circulate in the area of the hotels. Everything is under heavy security, and the shops can’t operate normally,” said taxi driver Cristóbal Trinidad.

And the tourist activities that made Cancun famous are limited, also for security reasons. No boats are allowed near the coast, sea tours have been canceled, and even vehicular traffic is sharply limited on area streets. The entire hotel zone is surrounded by hundreds of police and by temporary fences.

Construction began here in 1970 as part of the government’s Cancun-Rivera Maya project for a 150-km stretch of nearly virgin Caribbean beaches. Numerous archaeological sites and ruins form the millenniums-old Maya culture can still be found in the region, which now also holds 26,000 hotel rooms.

The project could be considered a great success, if not for the poverty of the communities living not far from the major tourist spots.

Just 10 km from Cancun’s hotel district, where the WTO conference is taking place, live some 750,000 people: 60 percent are poor, with 39 percent considered indigent.

Most residents have moved here from other points in Mexico with the aim of finding work in the international tourism industry.

Many have indeed found jobs, and work during the day and into the evening, returning home at night to their small wooden houses, located in neighborhoods with unpaved streets and no potable water or electricity.

“Cancun is the model of success in global tourism, but also the reflection of worst poverty. Here misery exists alongside great wealth, and one only has to take a short walk around the city to see it,” said Marco Origel, an activist with environmental watchdog Greenpeace and participant in the civil society forum.

According to figures from the Mexican government, the average monthly income of Cancun’s poor population is around $400, while those considered extremely poor earn less than $250.

In contrast, for the tourists staying at the luxury hotels in Cancun, spending $250 or $400 per night on a room is considered relatively economical. In some of the best hotels, a suite can cost more than $5,000.

South of Cancun, two hours by car, is the municipality of Solidaridad, founded in 1993. It is another of the examples of poverty that tourists are not likely to see when they visit the region, arriving via commercial airlines and cruise ships.

Many of Solidaridad’s 110,000 residents work in the hotels and tourism services along the coast. But at home, 30,000 people do not have electricity and 70,000 do not have potable water.

The Cancun-Rivera Maya project focused on tourism, but not on the people who would be drawn to the area in search of work, according to Agustín Cruz, of the local environmental group Society for Vital Ecology.

Population growth in urban Cancun and in Solidaridad is more than 20 percent a year, far above the national average of less than five percent in this country of 100 million people.

“Cancun is one of the best examples of the globalization of tourism: a lot of money and rich people enjoying vacations on the shores of misery,” said Greenpeace activist Origel.

Rumsfeld visits occupied Iraq

Compiled by Shawn Gaynor

Sept. 9 (AGR)—Donald Rumsfeld flew to Baghdad last week. Not to a skyline bristling with cranes, but to a city where there is still no electricity for much of the day because less power is being generated than had been under Saddam Hussein.

There he meet with weapons inspectors, who have still to find any evidence of weapons of mass destruction in Iraq, a claim that British and US officials are beginning to retreat from.

Rumsfeld was visiting to highlight progress on reconstruction efforts and dampen criticism of the US presence there and the almost daily casualties in a guerrilla campaign against occupation.

Rumsfeld traveled from Baghdad to Tikrit, Saddam Hussein’s birthplace. US troops fenced off broad areas of the city, flying helicopters and C-130 aircraft to protect the area.

“Donald Rumsfeld is nothing, but Bush I would cut to pieces,” said a man in a gray robe, who identified himself only as a former major in the Iraqi army, just 40 yards from US soldiers on a street corner.

US troops said if they had the chance, U.S. soldiers at a base in Iraq would have had one question for Defense Secretary Donald Rumsfeld — When are we going home?

But Rumsfeld canceled a speech he was due to give last Friday to the troops at their base at the palace of deposed Iraqi leader Saddam Hussein.

“I don’t give a damn about Rumsfeld. All I give a damn about is going home,” Specialist Rue Gretton said, humping packs of water bottles on his shoulders from a truck.

“If I got to talk to Rumsfeld I’d tell him to give us a return date. We’ve been here six months and the rumor is we’ll be here until at least March. This is totally, totally uncalled for,” she said.

Another soldier, who asked not to be identified, complained she would miss seeing her 16-year-old through her whole school year.

When the Armed Forces Network showed earlier footage of Rumsfeld saying that fresh US troops were unnecessary in Iraq, soldiers at the base threw their hands in the air and shouted “No way” at the television.

“I ain’t happy. No way am I happy seeing that,” said Specialist Devon Pierce, whose wife was due to give birth to his first son in two weeks. “This tour is hard, real hard. It’s too much. It should be six months.”

Nahidah Ismail, a nurse in Tikrit thought of what she would say to Rumsfeld if she saw him.

“Since you came here, what have you done for us,” she said. “Most of the people’s conditions are getting worse. They are not getting salaries. Prices keep going up. Before life was better for the middle class.”

Sihama Salah Ali, 43, dressed in a black chador, stood outside her decrepit three-floor apartment complex across the street from Saddam’s old palace.

“Life is only getting harder with the presence of the Americans,” she said, as she watched her three children, the oldest one nine years old, chase laughing after a US tank.

She lamented the hardness of life in post-Saddam Iraq, a complaint heard around the country and not just in the dictator’s favorite city.

“I have to run after cooking fuel and wait in long lines for food rations,” said Ali, a government clerk.

“Why don’t they help the poor families, especially with school starting next month and then the Ramadan fast?” she said, looking worn out.

Two missiles were fired at a US transport plane taking off from Baghdad’s airport, at the time that Donald Rumsfeld was leaving Iraq. The missiles missed their target.

Stopping over in Shannon, Ireland the US Defense Secretary said on Monday opposition to the US president was encouraging Washington’s enemies and hindering his “war against terrorism.”

It was in Shannon that some of the most direct opposition to the US war in Iraq took place as time after time Irish peace activist breached base security and damaged US military aircraft with shovels and hammers. Operations at the base were moved during the official wartime.

Rumsfeld said if Washington’s enemies believed Bush might waver or his opponents prevail, that could increase support for their activities.

“They take heart in that and that leads to more money going into these activities or that leads to more recruits or that leads to more encouragement or that leads to more staying power,” he told reporters traveling with him on his plane.

Reconstruction for whom?

Though calling the pace of reconstruction in Iraq slow would at this point be optimistic, major US corporations, particularly those who have lined the pockets of the Republican Party continue to be granted lucrative contracts.

One of the accusations leveled at the US invasion was that it was simply paving the way for a subsequent American corporate invasion. But despite billions of dollars of contracts won by American companies, there are no visible signs of reconstruction at all.

This week J. P. Morgan Chase, the second largest financial institution in the US, has been selected to operate a bank the United States is creating in Iraq to manage billions of dollars to finance imports and exports.

The Trade Bank of Iraq will give banks access to the financial system of Iraq, which has huge oil reserves; foreign bank companies have not operated in the country since a policy of nationalization in the 1950’s and 1960’s.

The situation in Iraq remains difficult for those awarded US contracts for reconstruction. Foreign businessmen are too afraid to visit Iraq for fear of being kidnapped. Those who have ventured in report being threatened at gunpoint by Iraqis. New Iraqi ministers have finally been appointed -- but the all-important Oil Minister, Ibrahim Mohammed Bahr al-Ulum, is not even in Iraq. He is holed up in Kuwait.

Iraqi businessmen gather every Thursday morning at the convention center taken over by the American occupation authority, where KBR (formerly Kellogg Brown and Root), a subsidiary of Halliburton and one of the US contractors for reconstructing Iraq, hands out tenders to local firms. As Doris Carter announces the tenders for this week, hands shoot up in the air. “We need two tractors with 40-foot trailers and an operator for two months,” yells Carter. There is a scramble for application forms.

Outside the auditorium, the Iraqi businessmen sit gloomily drinking coffee. “We left early,” explains a representative from a company that sells heavy equipment to the oil industry. “We could send our tea-boy to the local market to get contracts of the type they are awarding today. Everybody should stop going to these meetings as a protest against what is happening.”

Halliburton, the American corporation formerly headed by the US Vice-President, Dick Cheney, started out servicing Texas oil wells. It won contracts worth more than $1.7 billion in Iraq without ever having to go through a bidding process.

Then there is Bechtel, a major Republican contributor. The former Republican secretary of state from the Reagan era, George Schultz, is a Bechtel board member. As chairman of the so-called Committee to Liberate Iraq, Schultz was one of the biggest campaigners for war. Bechtel was awarded the primary contract -- worth as much as $680m (£415m) andpotentially much more lucrative -- to rebuild Iraq’s water and electricity supplies, roads, schools, sewers, and hospitals. Bechtel was chosen in a closed-door process, with just six companies, all American, invited to put in bids.

Bechtel’s contract is for work on many sectors, but most crucially electrical power, which Paul Bremer, head of the Coalition Provisional Authority, has called “the key to reconstruction”.

And yet Bechtel is now to get an extra $350m on top of the $680m contract it originally won. The new money is “to maintain momentum in high-priority infrastructure projects”, according to a funding document from the US-led Iraqi provisional authority.

That is despite a commitment from the US Agency for International Development (USAid), a government agency handing out massive contracts for reconstructing Iraq, that Bechtel would get no more American taxpayers’ money. A USAid spokesman said “security conditions” had prompted Bremer to change his mind.

International troops requested

The Bush administration suffered a humiliating diplomatic back-down over Iraq last week as it presented a draft resolution to the UN, asking for military and financial help to rescue it from the ballooning human, financial and political costs of the occupation.

The draft resolution calls for a Security Council mandate for a multinational military force, under a unified command and with American commanders ultimately in charge.

“Certainly, the United States will continue to play a dominant role,” Secretary of State, Colin Powell, said. “But a dominant role does not mean the only role.”

With the Bush administration having sidestepped the UN in order to go to war, the move marks a defeat for the White House, where defense department hawks had dismissed the UN as irrelevant.

The latest initiative comes primarily in a response to the widespread perception that Washington is losing control of the security situation in Iraq, prompted by the recent bombings by Iraqi insurgents of a senior Shia cleric, the UN’s offices in Baghdad, and the Jordanian embassy.

The French and German leaders delivered a cool response to a draft resolution sponsored by the United States, which aims to create a United Nations mandate for an international force while keeping the troops under US command.

Jacques Chirac, the French President, told a press conference yesterday: “We are ready to examine the proposals, but they seem quite far from what appears to us the primary objective, namely the transfer of political responsibility to an Iraqi government as soon as possible.”

He was speaking in Dresden after a summit with the German Chancellor, Gerhard Schröder, who endorsed Chirac’s comments. “I agree with the President when he says, ‘not dynamic enough, not sufficient’,” Mr Schröder said.

Wary of Iraqi hostility to the US-led occupation, India, Pakistan, Bangladesh, Turkey, and other potential contributors have balked at sending troops without an international mandate.

Newly appointed Iraqi Foreign Minister Hoshyar Zebari said his government would not welcome troops from neighboring countries because they might meddle in Iraq’s affairs.

Asked about a possible Turkish peacekeeping role, he told the Arabic television channel Al Jazeera: “Our neighboring countries have their own political agendas, which they could bring with them to Iraq, thus causing more instability in Iraq.”

Washington wants Turkey, NATO’s only Muslim member, to send troops quickly. The Turkish public has little enthusiasm for such a mission, but Ankara knows that another refusal to commit forces to Iraq could jeopardize much-needed US loans.

The UN secretary general, Kofi Annan, has made it clear that he does not want UN blue helmets to be deployed in Iraq.

Source: Agence France-Presse, Guardian/UK, Independent (UK), New York Times, Reuters