by Richard Gowan | Aug 3, 2009 | Africa, Climate and resource scarcity, Conflict and security
Bad news from South Sudan:
At least 185 people – mostly women and children – have been killed in ethnic violence in South Sudan, officials say.
Members of the Lou Nuer community had gone fishing south of Akobo town amid a severe food shortage when ethnic Murle fighters reportedly attacked them.
Eleven soldiers from the South Sudan army, the SPLA, who were protecting the Lou Nuer, were among those killed.
Several hundred people have died in such clashes this year – more than in Sudan’s Darfur conflict, the UN says.
How can this be stopped?
The state’s governor, Kuol Manyang, told the BBC that a few survivors had made it back to Akobo town, though many of them were wounded.
Those killed, he said, were on the fishing expedition because food supplies were running out following an attack in June on river barges carrying aid.
He appealed to the UN World Food Programme to find a way of getting food to them.
But there’s a bit of problem with that, highlighted by the BBC last week:
The UN food agency says it is facing critical funding shortages that have forced it to cut aid deliveries to millions of people facing starvation.
The World Food Programme (WFP) said it could have to close parts of its airway, used to fly aid workers to humanitarian trouble-spots.
Deliveries have already been suspended to north Uganda, Ivory Coast and Niger.
The organisation has issued similar warnings in the past when facing funding shortages.
The UN Humanitarian Air Service (UNHAS), operated by WFP, has a budget for 2009 of $160m (£96m) but has received less than $90m in fees and contributions this year.
WFP spokesman Greg Barrow said UNHAS was “a vital component of humanitarian operations across the world”.
“But because of a funding shortfall there is now a grave risk that the air service … could literally be grounded in the next few weeks due to a lack of funds,” he said.
It’s less than a month since the G8 leaders promised billions of dollars to food aid – with a focus on increasing agricultural capacity rather than crisis response. That’s the right approach. But we need crisis response too, or this sort of violence is going to get worse.
by Jules Evans | Aug 3, 2009 | Economics and development, Global system
As you probably know, one of the main causes of the huge debt bubble of the last few years was the fact banks created Special Investment Vehicles (SIVs) – or off-balance-sheet virtual companies – which then bought trillions of dollars in securitized debt (or asset-backed securities – ABS).
This enabled banks to lend like mad – in loans, mortgages, credit cards etc – then securitize the loans into ABS, take them off their balance sheet, insure them, then buy them back via the SIVs.
This led to the growth of a $60 trillion – yes, a $60 trillion – securitization market, according to ECB estimates, with average issuance every quarter of $900bn.
Then the market collapsed, because it turned out a lot of the mortgages that had been securitized were dodgier than thought, and the rating agencies had got the ratings wrong, and the insurers didn’t have enough capital to cover the losses, and, well, it got a bit messy.
Then no one wanted to lend to the SIVs anymore, so they went bust or were unwound. That meant suddenly there was no demand left for ABS in the securitization market, so no financing for all those mortgage and credit card lenders out there.
Faced with the prospect of the collapse of retail lending, US and European central banks stepped in and agreed to buy banks’ mortgage-backed bonds from them, to try and get demand going in the securitization market.
The Fed, for example, has said it will buy $1.25 trillion in mortgage-backed bonds from the market. Its buying around $20 billion in mortgage bonds a week.
The ECB has also agreed to buy ABS and MBS from the market, via its repo auction system – essentially, banks can use ABS as collateral for ECB liquidity, as long as the ABS was once rated AAA and is now rated no lower than A (or, at one point, BB -).
European banks have leapt on this magnanimous gesture from the ECB, and raced to re-securitize their toxic waste and swap it with the ECB for something worth a bit more.
I rang up the ECB to ask them how much ABS it had accepted as repo collateral from European banks. I was told:
‘Oh, we don’t tell people. You won’t be able to find it out. We don’t reveal that information.’
Can you imagine – this is a public bail-out of private European banks for their bad decisions in buying so much asset-backed debt, and we can’t even find out how big the bail out is, or what sort of price the ECB paid for the debt.
All we know is that, in contrast to the UK Treasury’s programme, banks have fallen over themselves to participate, suggesting the ECB’s terms are more than generous to the hapless banks.
And we also know that many banks – Barclays Capital, HSBC and others – have posted record profits this quarter…
But we have no way of knowing quite how much we have helped the banks to their record profits, because the ECB won’t reveal the terms. I rang up some securitization analysts at investment banks to find out how much the ECB had bought, but funnily enough, they wouldn’t tell me either.
This isn’t democracy. It’s a financial oligarchy.
by Elizabeth Sellwood | Aug 1, 2009 | Middle East and North Africa
Palestinian President Abbas and the Fatah-dominated Palestinian Authority face regular criticism that they are being “more Israeli than the Israelis” in their efforts to control Palestinian terrorism in the West Bank. While leading Israelis and Americans are impressed by the PA’s efforts to oust terrorist cells and arrest suspects in Jenin, Nablus and other West Bank towns, sceptical Palestinians are beginning mockingly to refer to General Dayton, the US military adviser, as the “Palestinian minister of defence”. Members of Abbas’s Fatah party are also reportedly concerned that its leaders’ efforts to quell “resistance” against the Israeli occupation will limit its popularity among ordinary Palestinians.
Now Hamas, Fatah’s main rival, has begun to adopt an Israeli tactic too: closure. The Israeli newspaper Ha’aretz reports that
Hamas, which rules the Gaza Strip, denied Fatah members permission to travel to the West Bank to take part in an internal Fatah election. The 400-odd Gazans want to to to Bethlehem, where they would be among 1,550 Fatah officials voting to elect the organisation’s leadership. But Hamas has announced that it will not allow them to attend until “the issue of political arrests in the West Bank is resolved” – meaning, until Hamas men are released from Palestinian Authority prisons.
Israel has long used its capacity to deny movement between the West Bank and Gaza as a way to control Palestinian political developments. The fact that the occupied are beginning to adopt the tactics of the occupiers in their efforts to prevent progress by their domestic political rivals is a sad indication of the dire state of inter-Palestinian politics.
by Alex Evans | Aug 1, 2009 | Climate and resource scarcity
Is a peak for global oil demand in sight, wonders the Guardian’s Data Blog this morning? Er, no – what might make them think that, you wonder? Answer: a new Greenpeace report called Shifting Sands, which argues that the case for developing tar sands in Canada is rapidly diminishing as oil demand falls. The report pulls together demand forecasts from OPEC and IEA, and argues that on top of the effects of the recession,
“In the longer term, the impact of two key policy instruments adopted in the US and EU are cited as gaining in influence. These are the US Energy Independence and Security Act and the EU Climate and Energy package. These policies, and the fact that there has been a degree of saturation in these markets, have led to the unanimous conclusion among these agencies that oil demand in the OECD has peaked.”
OECD, schm-OECD! They’re beside the point! Let’s remind ourselves of what the last IEA Outlook report actually said:
Global primary demand for oil (excluding biofuels) rises by 1% per year on average [in the report’s Reference Scenario], from 85 million barrels per day in 2007 to 106 mb/d in 2030 … all of the projected increase in world oil demand comes from non-OECD countries.
It is entirely true to point out, as Greenpeace do, that investment in tar sands has fallen off a cliff as oil prices have crashed from $147 last July to their current level of around $60, and that investor uncertainty over future demand is the big driver here.
But to go from there to talking about a peak in world oil demand? I wish.
