21st Year of Publication number 1069 16 -22 februarY, 2014 € 3.50

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W hile the US resorted to obscenities, being frus-trated by the sluggish-

ness of Brussels, Russia has taken a different attitude: It is decision time.

As the Russian Minister of For-eign Affairs. Sergey Lavrov, notes in his article written exclusively for New Europe, “one can say that Russia-EU relations have approached the mo-ment of truth.” A situation precipi-tated by the question of Ukraine.

When it comes to Ukraine, Rus-sia and the EU are destined to even-tually cooperate. A sign of this prag-matism was when Putin won a major concession from the Europeans: Russia will be consulted in the future about the evolution of the Eastern Partnership, of which Ukraine is the principal member.

From the extreme of cavorting with the opposition on the Maidan, Kiev’s main square, where the pro-tests have been going for two months, the EU high officials went now to the opposite extreme of offering Russian experts to discuss with the EU the Association agreements offered to neighbouring countries.

EU officials were shocked back in November when Ukraine refused to become the first Eastern Partnership country to sign an Association agree-ment with the EU.

In Brussels, EU officials seemed bewildered at the Ukrainian leader-ship’s hesitations, while others con-

sidered Russia’s behind the scenes string-pulling as foul play. In fact, the EU seems to have miscalculated Ukraine’s huge affective importance for the Russian psyche. The territory of today’s Ukraine was the birthplace of the old Russian culture, and in the eyes of most Russians Ukraine plays the same historical and symbolic role as Kosovo for the Serbs.

Ukraine was the cradle of the first Russian political formations, includ-ing Kievan Rus', and in the Middle Ages those feudal political entities laid the foundation for the national identity of Russians. Vladimir the Great, Putin's namesake, ruled from Kiev and Christianised his subjects, making the Russians identify them-

selves with the Orthodox, Eastern Christian church.

Russians and Ukrainians have al-ways had a complex relationship. Until the early XXth century, the Ukrain-ians were simply known as the "little Russians”. More recently, after Stalin s death, his successor, Nikita Khrush-chev, offered the Crimean peninsula to Ukraine, something that Russian nationalists resent even today. Many in Russia are outraged at Ukraine’s “un-gratefulness”. The Russian Black Sea fleet is based in the Crimean port of Sevastopol, and there have been re-current tensions between Russia and Ukraine about this, with Kiev reluc-tant to renew the lease of the harbour to Russia.

Russian Prime Minister Vladimir Putin (left) takes the arm of European Commission President Jose Manuel Barroso (R). EPA/OLIVIER HOSLET

Scotland Page 22

South Sudan Page 14

Page 03

Interview with Gianni Pittella Page 05

More secrecy for Swiss banks?

by dan alexe Page 07

Füle calls for dialogue in ukraine

by Kostis Geropoulos Page 29

Make a decision

Europe needs a ‘parliamentary coup’The Vice President of the European Parliament, Gianni Pittella calls for a new European coun-teroffensive led by the European parliament which after the May 2014 elections should pro-mote a new constituent phase. In this regard, the nomination of a candidate for the presi-dency of European Commission by each politi-cal group may result in a parlamentarisation of the European Commission which will become accountable to the European Parliament and “Martin Schulz will be a great President of the Commission elected by the Parliament”. Yet, Mr Pittella is aware of the growing gap between citizens and the European Union and calls for a more concrete EU approach to meet up peo-

ple’s expectaions: “A dogmatic approach to aus-terity is leading Europe to the brink of disaster.” said Mr Pittella who also calls for a flexible but responsible implementation of the stability pact and the introduction of Eurobonds. In Mr Pit-tella’s vision, the European counteroffensive should also promote bold reforms. “I believe that the battle between global democracy and unregulated finance will be the dividing line of European politics in the following decades. Thus, the goal of the next round of reforms should be aimed at continuing the reform of the financial system, already started by the Parlia-ment”. In particular, he supports a full separa-tion between investment and retail banks.

“I never mix politics with singing”

The latest feats of traian Basescu

by Dula barDha Page 08

interview with antonis remos Page 15

Russian FM Lavrov tells Brussels to get serious

EXCLUSIVE:

02 ANALYSIS NEWEUROPEwww.neweurope.eu16 -22 February, 2014

Australia $3.4, Austria EURO 1.81, Balkans EURO 4,

Belgium EURO 3.50, Holland EURO 2.69, Central Asia

USD7.5, Central Europe USD5, Canada $5, Denmark:

DKK 19,95, Eastern Europe USD7.5, France EURO 3.04,

Germany EURO 3.57, Greece EURO 4, Hungary

HUF430, Japan Y900, Italy EURO 3.62, Nordic countries

USD7, Pacific Rim USD8.5, Russia USD 4, Switzerland

Relations out in the cold

The European Commission last weekadopted a communication on EU-Russiarelations, which proposes measures toimprove the effectiveness of relations withthe largest country of world.

Editorial p. 2

Italy unveils investors bill

Italian Prime Minister Silvio Berlusconiand his cabinet last week heralded a newera in the financial regulatory system ofthe country by unveiling a draft law toreform the modus operandi in the sector.

p. 17

Luxembourg OKsEU enlargement

The parliament of Luxembourg ratifiedlast Tuesday the treaty for the enlargementof the European Union from the current15 member states to 25 on May 1.

p. 23

Banking sector strategy changes

Central bankers predict a boom in Russia’sconsumer credit market over a two orthree-year period, but strict control mea-sures are on their way, said governmentofficials recently.

p. 36

Ukraine and WTO membership

Ukraine expects further French support inits bid for membership in the World TradeOrganisation, and is moving towardobtaining market economy status from theEuropean Union.

p. 40

EU gears up for budget battle

NOTEBOOK

Why doing business in EU is less competitiveEuropean Union markets suffer from complexrestrictions and concerted practices mainly inthe professional services sector. This leads tovery expensive and non-competitive services inthe entire economy, making at the end the EUeconomy less competitive, mainly in mainlandEurope.

To the same extent, Britain does not sufferfrom this severe drawback. To change this, theEuropean Commission last week called onmember states, the professions and their regu-latory bodies to reform or eliminate price-fixingand other restrictions which prevent competi-tion between, among others, lawyers and archi-tects unless clearly justified by public interestconsiderations.

In a report on Competition in Professional Ser-vices adopted last week, the Commission con-cluded that those restrictions must be dealt withat national levels, as they are mostly national inscope. But the Commission will continue tomonitor efforts by national antitrust bodies. It

also will continue to tackle violations wherethis cannot be achieved at national levels.

Extensive research by the Commission into thestate of competition among lawyers, notaries,accountants, architects, engineers, pharmacistsetc, concludes that existence of fixed prices,bans of advertisement and other restrictionsprevents the delivery of benefits of competitionto the economy and consumers of such ser-vices. Based on Eurostat figures, services arethe main motor for growth in the EU economy,accounting for 54 percent of GDP and 67 per-cent of employment. Professions are an impor-tant part of these and the enduring restrictionsare holding back productivity and growth in theentire economy. So the business communityfeels that doing business in Europe is muchmore expensive than doing business in theUnited States. The final result is a less compet-itive economy in total. And this has to mustchange.

AAt least six states are vocalin their opposition to theEuropean Commission’sdemands for a major

upward swing in spending as theEuropean Union expands from 15 to25 members in May.

The current budget of around100 billion Euro a year amounts to0.98 percent of the EU’s GDP. TheCommission wants to put the figureup to 1.22 percent of gross nationalincome (GNI) in the years after2007. That would still come in underthe permitted upper limit of 1.24percent. But the six countries -Britain, France, Germany, TheNetherlands, Austria and Sweden -want the limit lowered to 1 percentof GNI.

According to the Commissionproposals the expanded budgetwould focus on three main areas -sustainable development, the inter-ests of the citizens and strengtheningthe union’s voice as a global partner.

German Finance Minister HansEichel quipped last Monday: “Itdoesn’t fit. You can’t say on onehand, ‘You in Germany have to savemoney and cut down expenditure’

and demand at the same time ‘Youhave to pay more money to Brus-sels,’” adding: “You cannot preachwater and drink wine.”

Commission President RomanoProdi said he could not work “mira-

cles” on limited funds as the expan-sion goes ahead. And European Par-liament chief Pat Cox said, “This isnot the time to do Europe on thecheap, nor is it the time for short ter-mism, retreat or hesitation,” he said.

www.new-europe.info12th Year, Number 560

THE EUROPEAN WEEKLY

February 15 - 21, 2004

New EuropeWorking TimeDirective in EU

The “Work-ing Time”Directive wasadopted 10years ago in1993 andincluded thepossibility for

individual workers to sign anopt-out from the central pro-tection given by the Directivewhich is that any worker canrefuse to work on averagemore than 48 hours per week.According to Stephen Hugh-es Member of European Par-liament (PES) the opt-outwas agreed purely to try andbuy the support of the thenconservative UK govern-ment. Hughes pinpointedthat the original Directivesaid that after 7 years beyondthe implementation of theDirective, which was back in1997, the Commission wouldhave to review the situationon the operation of this opt-out, and make appropriaterecommendations. The Com-mission did indeed come upwith its communication at theend of December, but didn’tmake a firm recommendationas to what should happen tothis opt-out. The MEP in acandid interview spoke toAlexander B. Coronakisabout the “Working Time”Directive and pros and consof its implications for work-ers. p 3

cyanmageyelloblack

EU Commissioner for Economic Affairs Pedro Solbes (R) shares a lightermoment with Austria’s Finance Minister Karl Heinz Grasser

Tug of war between paymasters and beneficiaries set to develop

KLM-Air France tie knot

Following two months of deliberations about fair com-petition aspects, the EU Commission last Wednesday

gave the go-ahead to the alliance of Air France and KLMRoyal Dutch Airlines - but the two will have to forfeitnearly 100 starting and landing rights. The Commissionruling means the new airline forged by the two willbecome Europe’s biggest.The forfeited slots will be given to competing airlines -mainly flights to and from Amsterdam and Paris, and anumber of routes between Europe and North America. Interms of turnover the new Air France-KLM concern willbe the world’s biggest; in terms of flights operated it willbe the third-biggest after US concerns American Airlinesand Delta Air Lines. EU Competition Commissioner Mario Monti said inBrussels the long-expected consolidation within the Euro-pean aviation industry conformed with EU competitionrules. The Air France-KLM deal would give passengers agreater choice of destinations without obliging the twopartners to pay more for routes where the other wasstronger. Most affected by the obligation to give up a totalof 94 take-off and landing rights per day would be routesto or from Amsterdam, followed by routes from Amster-dam or Paris to overseas destinations.

p. 5

New Europe bylines

Older and eager to work By

Bashir Khanbhai, p. 7

Stephen Huges

The Shooting Gallery

Pardon Herman? What do you mean we’re going to have fewer MEPs after May because we’re ‘a much smaller landmass’ now? EPA/ANDREW PARSONS

A decade ago six northern countries were looking to keep a rise in the EU budget to 1% of gross na-tional income, the previous level being just 0.2% lower. The Commission was hoping for a rise to 1.24%, saying the money would be needed for “sustainable development” the less well defined “interests of the citizens” and the most important investment of all, “strengthening the union’s voice as a global player.”Happy times, when such a thought could be said with a straight face. Pat Cox was disappointed, say-ing “This is not the time for short termism, retreat or hesitation.”The Commission adopted a communication de-signed to improve relations with Russia. Berlusconi introduced a new regulatory system and Luxem-bourg approved the enlargement of the EU.

ne 10 YeARS

AGO

MMThe result of Switzerland’s referendum in which voters decided to im-pose new curbs on immigration appears to have shocked many leaders in Europe. The majority of Swiss voters called on their government to forge a new legislative framework as regards the arrival of new immigrants from Eu-ropean Union member states. Switzerland is not a member of the EU. It is only a signatory of the Schengen Agreement and as such keeps its borders open to job seekers who are citizens and residents of EU countries. This is nothing new. For decades, workers from the neighbouring EU countries have been crossing the border into Switzerland to go to work in the morning and then crossing back in the evening to return home. So, what has changed? The enlargement of the EU to 28 countries has opened the Swiss labour market to a huge number of EU citizens from every corner of Europe.It goes without saying that the favourable labour conditions in Switzer-land are a strong magnate for job seekers from the EU. Obviously many European leaders have been quick to criticise the Swiss. One by one, EU politicians and opinion leaders have accused the Swiss of violating one of the most “sacred principles” of the EU – the freedom of movement.Luxembourg’s Foreign Minister Jean Asselborn, for instance, said: “One of the achievements of the European Union is the free movement of people and that can’t be watered down”.In a similar vein, France’s Foreign Minister Laurent Fabius told RTL radio that the EU’s 1999 agreement with Switzerland has a “guillotine clause” which means that if one element is challenged “then everything falls apart”.It is true. The recent referendum in Switzerland shed new light on the two opposing sides of Swiss society. On one side are the traditionalists who live in a conservative dream world in which the Swiss are isolated and believe that nothing good can come by living together with foreign-ers. On the other side are the Swiss who realise that a considerable part of their wealth and success is due to the presence of immigrants.After all, the healthy state of Switzerland’s economy is not only due to the country’s banking sector. It is also due to its industry and services and this fortune is directly related to the massive presence of foreign workers - whether they are immigrants from EU member states or from other countries.Nevertheless, the result of the referendum suggests that the conserva-tive side of Switzerland is representative of a large population group in the country. But there is also another question that has arisen from the referendum. This one is about the EU’s reaction, which is rather hypocritical.What was the reaction in some of the EU’s richest countries when Ro-manians and Bulgarians secured the right of free movement in the EU this past January? It was racist and xenophobic. Was this reaction a reflection of our European principles? Were the citi-zens of Romania and Bulgaria - both EU countries - treated as equals by their European counterparts? The answer to both questions is, without a doubt, a resounding no.Let’s not forget those European politicians who have even come out in favour of restricting the free movement of workers from the southern European countries, mainly Italy, Spain, Greece and Portugal. Should these views be acceptable to the representatives of the common Euro-pean house? Are these thoughts compatible to European solidarity and the European values? These are not difficult questions to answer. The answer to both questions is once again: absolutely not!Therefore, before we start shouting and pretending to be offended by the result of the Swiss vote, we should take a closer look at the situation in our own backyard.

Swiss say “Nein”, not “Non”

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03inside eUNEWEUROPEwww.neweurope.eu16 -22 February, 2014

Events in Ukraine raised the tone of rhetoric in the European media on the issue of EU-Russia relations. The de-

velopments are often depicted in a straight-forward, even primitive way, as a standoff between Washington and Brussels, on one side, and Moscow on the other. It is being said that the strive of the Ukrainian people to join Europe is being blocked by the Russians, and thus there is need to “go to the end” and support the “democratic forces” in Ukraine.

This widespread media picture does not reflect the real situation. Ukraine is not in-vited into Europe, meaning it is not offered the prospect of full EU membership. The draft association agreement which was being prepared for signature at the Eastern Partner-ship summit in Vilnius envisages extending EU standards to Ukraine and opening the Ukrainian market for European products. It was also drafted so as to hamper economic cooperation of Ukraine with its partners in the East, first of all Russia.

Nevertheless, Russia believes that it is up to the Ukrainians to decide whether to ac-cept or decline that offer. We have unswerv-ingly proceeded from the premise that the people of Ukraine, and of any other country, have the sovereign right to choose in which direction they want to develop and in which integration structures they want to take part. Russia does not impose anything on anyone, understanding that an integration project will last only if it is based on mutual interests. All we did was to explain to our Ukrainian partners that changing the economic rules of the game on their side of the border would mean departure from arrangements reached within the framework of the Commonwealth of Independent States Free Trade Area and would lead to a strictly adequate reaction from Russia in accordance with international standards, including WTO norms.

However, the US and the EU tended to see the situation differently. Our Western partners have already made the choice for the Ukrainians and are not prepared to wait for the citizens of that country to solve the ques-tion of their future constitutionally, in a dem-ocratic way. The opinion of several thousand demonstrators who are trying to violently pressure the government passes for the voice of the people.

Desta- bilizing a nation in the centre of

the European continent can hardly serve anyone’s interest. It is impossible not to see that the actions of antigovernment forces in Ukraine increasingly display nationalist, anti-Semitic, racist feelings. In the meantime the issue of participating in one or another in-tegration project is overshadowed by radical slogans which have nothing to do with Euro-pean culture.

The internal strife in Ukraine proves that the Ukrainian society seems today unable to decide quickly and resolutely which way to take in country’s external relations – West or East. Former President Victor Yushchenko’s attempts some time ago to do that brought

the Ukrainian State to the brink of disintegra-tion. Unfortunately, the country is now being pushed in the same direction.

We are against returning to the logic of zero-sum geopolitical games, be it in Ukraine or in Europe as a whole. President Vladimir Putin came up with the initiative to a create common economic and humani-tarian space stretching from the Atlantic to the Pacific and providing for free movement of people and free exchange of goods and services. The implementation of this idea would make it possible to unleash the huge potential of Russia-EU partnership. Uniting technologies, resources and human power would serve as a mighty catalyst of develop-ment of both EU and Russia while strength-ening their positions in today’s world of in-tense competition.

The foundation is there: irreconcilable ideological differences are a thing of the past, principles of democracy and market econ-omy are now recognized everywhere across the Euro-Atlantic area. And over the last two decades cooperation between the two main actors on the European continent – Russia and the EU – has made great strides.

Of course, a new level of partnership can only be attained on the basis of equality and

mutual respect. States in the post-Soviet space have the same right to develop integration ties as do countries in the West of Europe.

The Eurasian Economic Union (EAEU) being created by Russia, Belarus and Kazakh-stan is built on principles similar to those of the European Union and is based on WTO rules. At the very launch of this large-scale integration project it was understood that it would be desirable to harmonize it with the integration processes in the EU.

Certainly such a task will not be solved overnight, but we believe this goal is achieva-ble. That is why we suggested to our partners at the recent Russia-EU summit in Brussels to study the possibility of establishing a free trade area between the European Union and the EAEU by the year 2020.

Such a shared view of the future would clearly help our common neighbours to de-velop ties both westwards and eastwards comfortably, without conflict. As a result a historic step towards building a common European home would be made. Nowadays, when military confrontation in Europe has become unthinkable, it is time to convert into practical deeds the decisions taken in the OSCE and Russia-NATO Council on creat-ing a common space of peace, security and stability in the Euro-Atlantic area.

One can say that Russia-EU relations have approached the moment of truth. To develop our cooperation continuously and purposefully we should understand whether we want to proceed along the way of attaining ambitious goals of strategic partnership. Oth-erwise we will go on stumbling at every step because of lack of clear sense of direction. In-formation wars won’t help, what we need is real leadership and political wisdom.

Russia-EU: Decision Time

Euro-stat’s Days: Part II.

Russian President Vladimir Putin speaks during a joint press conference with EU Council president and European Commission President on January 28, 2014, following an EU-Russia summit. AFP PHOTO / JOHN THYS

Minister of Foreign Affairs of Russia

By Sergey Lavrov

Ukraine is not invited into Europe, meaning it is not offered the prospect of full EU

membership... Russia does not impose anything on anyone, understanding that an integration project

will last only if it is based on mutual interests

The foundation is there: irreconcilable ideological differences are a thing of the past,

principles of democracy and market economy are now recognized everywhere across the Euro-Atlantic area. And over the last two decades cooperation between

the two main actors on the European continent – Russia and the EU – has made great strides

EXCLUSIVE:

04 inside eU NEWEUROPEwww.neweurope.eu16 -22 February, 2014

The EU will use economy as a policy tool to pressure Israel for talks with Palestine for the promotion of the

two-state solution.On 13 February, Azriel Bermant of the

Institute for National Security Studies in Tel Aviv told the Chinese news agency Xinhua that the EU wants to use its influence on the Israeli-Palestinian negations and one choice is by using its economic ties with Israel as a car-rot. According to Xinhua, Mr. Bermant said that the internal market, is a very important destination for Israeli exports, and the EU wants to use this power wherever it can in or-der to promote the two-state solution for Is-rael and Palestine.

On the other hand, Jonathan Rynhold of the Bar-Ilan University disagreed with Mr. Ber-mant and told Xinhua that while the EU wants to have an influence in the peace process its eco-nomic influence might be over-rated. “The EU speaks loudly, but carries a small stick,” Mr. Ryn-hold said and added, “it’s very hard for the EU to act as a block on these kinds of things, it tends to be left to individual states.”

The policy expert doubted how much economic influence the EU really has over Israel, noting that Israel was allowed to join Horizon 2020, where Israel can compete for over 104 billion U.S. dollars in research grants.

“Since Europe is Israel’s second largest export market, a lot of companies in the economical-ly shaky Europe are interested in what Israel has to offer and would like to continue to buy goods from Israel,” he stressed.

According to Xinhua, a few European banks and insurance companies have already stopped investing in Israeli companies that operate in the West Bank or are considered to help the Jewish state maintain its occupation of the area.

However, analysts disagree on how much the EU can influence the Israeli economy

Xinhua: EU will use economy to pressure Israel for talks with PalestineBringing together important figures in ur-

ban policy, the CiTIEs: Cities of Tomorrow: Investing in Europe forum is scheduled to take place on February 17 and 18 in Brus-sels with a view to putting urban agenda at the top of EU policy-making. The meeting aims at making sure that citizens’ voices are heard and policies are more co-ordinated in order to achieve wider European goals like tackling climate change, unemployment and social exclusion.As European Commissioner for Regional Policy Johannes Hahn stated: “I am deter-mined to raise the profile of our cities. Cities are too important to be treated as a side is-sue. They should be central to our thinking. After all, most Europeans live in cities. We need to make them a better place to live in and make sure they are better heard.”He added: “This is why I now want to launch a debate to ensure the urban reality of today’s EU is fully understood and taken into account by policy makers. Cities of to-morrow are the Europe of tomorrow.”The forum will explore how a more coordi-nated approach can be extended across all levels of European policy making, as well as explore the role of cities in implementing policies which should reflect their potential and needs.Urban experts, city associations, local au-thorities, representatives from national ministries as well, as well as mayors from 16 capital cities in the EU are expected to par-ticipate in the forum.

Cities of Tomorrow: Urban policy in the EU

I never promised EU a rose garden. Palestinian workers harvest carnations at a plastic greenhouse in the Gaza Strip. AFP PHOTO/ SAID KHATIB

Eurozone economy expanded by 0.3%Eurozone economy increased by 0.3% in the fourth quarter of 2013, according to the latest Eurostat figures.However, according to the statistical office of the European Union, over the whole year the Eurozone economy shrank by 0.4%. In regard with the EU economy, it increased by 0.4% in the fourth quarter of 2013 while for the whole year it expanded by 0.1%. At the same quarter the US economy grew by 0.8%.Today, INSEE also announced that the French economy rose by 0.3% in the fourth quarter of 2013, while German GDP also rose by 0.4% for the same period. Both growth figures were above the market’s expectations. Besides Germany and France, the third largest economy in Eurozone, Italy, registered the first quarterly growth since 2011. The Italian statistics agency announced today that the Italian economy grew by 0.1%. Moreo-ver, Spanish growth accelerated to 0.3% in the fourth quarter from 0.1%, while the Dutch economy grew by 0.7% being more than twice as much as forecasted.Thomas Harjes, senior European economist at Barclays Plc in Frankfurt told Bloomberg about the data, “these data confirm our out-look and that of the ECB that we are in recov-ery mode…It might not be a strong recovery

but we are heading in the right direction.”Besides the expansion of the Eurozone econo-my, Eurostat also announced that Eurozone’s in-ternational trade in goods recorded a €153.8bn surplus in 2013, compared with €79.7bn sur-plus in 2012.

Electronics industry submits action planElectronics industry CEOs said that Europe can capture up to 60% of new electronics markets, and double the economic value of semiconductor component within the next 10 years, in a plan delivered to the European Commission today. The detailed plan from 11 Electronics CEOs was requested by European Commission Vice-President Neelie Kroes from an Electronics Leaders’ Group (ELG), set up in 2013.As Vice-President Kroes said: “I want us in the driver’s seat. The sector wants to be back in the driver’s seat. So my message is this: we are go-ing to make Europe the place to make and buy innovative micro and nano-electronics.”In the plan, CEOs stressed that production in Europe’s strong sectors such as automotive, en-ergy, industrial automation and security can be doubled in the next 10 years. Regarding, new high growth areas, in particu-lar Internet of Things (IoT) and the develop-

ment of ‘Smart-X’ markets (e.g. smart homes, smart grids etc.), the target is to capture 60% of this emerging market by 2020. In respect with mobile and wireless communi-cations, the target is for Europe to capture 20% of the projected growth.The group also proposed: a major initiative, “Smart Everything Everywhere” to establish centres of excellence and zones for large-scale, real-life testing of emerging technologies throughout Europe; to increase capacity by 70,000 new wafers (the slices of semiconduc-tor material on which the chips are manufac-tured) per month from 2016/17 onwards; and to preserve competition in production by relying on the strong material and equipment industry.

Two new ‘innovation communities’ launchedThe European Institute of Innovation and Technology (EIT) has today launched a selec-tion process to set up two new Knowledge and Innovation Communities (KICs), with part-ners from higher education, research and busi-ness. The two KICs will focus on innovation for healthy living and active ageing, and on raw materials – sustainable exploration, extraction

processing, recycling and substitution. The ap-plication process is open until 10 September. As Androulla Vassiliou, the European Commissioner responsible for the EIT stated: “This is the first step in our expan-sion of the EIT, with five new KICs planned over the next seven years. We’re looking for great innovators and entrepreneurs with the drive to tackle concrete challenges and deliver results. I hope that many organisa-tions will respond to this call and join us in this exciting journey.”The KICs are autonomous public-private partnerships that aim to bring together higher education institutions, research centres, com-panies and other organisations committed to helping society through the development of products, services and processes.There are currently three KICs focused on climate change, ICT and sustainable energy (Climate KIC, KIC InnoEnergy and EIT ICT Labs). They have provided entrepreneurship training for more than 1 000 students and con-tributed to the creation of more than 100 start-ups. The KICs have also assisted the launch of around 90 new products, services or processes, as well as the implementation of more than 400 business ideas.The partnership for the new KICs must consist of at least three organisations, established in at least three different EU Member States. It must include at least one higher education institu-tion and one private company.

05INTERVIEWNEWEUROPEwww.neweurope.eu16 -22 February, 2014

I n the corridors of Brussels, he is considered one of the top front-runners for the posts of President

of the European Parliament and leader of the Socialist group but when asked about his personal projects , Gianni Pittella, vice-president of the Europe-an Parliament from the Italian Demo-cratic Party, simply replies: “ This is not the issue. At the next European elections, the future of Europe will be at stake and ideas will matter more than careers”.

Mr Pittella calls for a new Eu-ropean counteroffensive led by the European parliament which after the May 2014 elections should promote a new constituent phase. In this regard, the nomination of a candidate for the presidency of European Commission by each political group may result in a parlamentarisation of the European Commission which will become ac-countable to the European Parliament and “Martin Schulz will be a great President of the Commission elected by the Parliament”.

Yet, Mr Pittella is aware of the growing gap between citizens and the European Union and calls for a more concrete EU approach to meet up people’s expectaions: “A dogmatic ap-proach to austerity is leading Europe to the brink of disaster.” said Mr Pit-tella who also calls for a flexible but responsible implementation of the stability pact and the introduction of Eurobonds.

In Mr Pittella’s vision, the Euro-pean counteroffensive should also promote bold reforms.

“I believe that the battle between global democracy and unregulated fi-nance will be the dividing line of Euro-pean politics in the following decades. Thus, the goal of the next round of reforms should be aimed at continu-ing the reform of the financial system, already started by the Parliament”. In particular, he supports a full separa-tion between investment and retail banks.

This new European assertiveness should also result in a more ambitious foreign policy. “The future of Europe as a project of peace and democracy also depends on our ability to contrib-ute to supporting human rights and rule of law all over the world.” Ukraine but also Sub-Saharan Africa will there-fore be the litmus test to assess Eu-rope’s commitment to really support these values.

Mr. Pittella, many pundits ar-gue that the European Un ion is fac-ing an existential crisis. How do you see the situation?

“Europe, as a civilizing project, will only survive if it finds a political dimension and I have the impression that on this point all member states are too shy and not active enough. To counter this stalemate, in the next mandate the European Parliament needs to follow Jacques Delors’ and Helmut Schmidt’s provocative advice and initiate a “parliamentary coup”. We need a pro-European counteroffensive to support a new constituent phase led by the Parliament. An open debate during the electoral campaign on the future of Europe is the most powerful weapon at our disposal to support the next Parliament’s initiative. Each politi-cal group is nominating a candidate for the presidency of the European Com-mission and working on a manifesto for Europe which will clarify theirs visions of the European project. That way we can finally start having a debate about concrete issues transforming the Commission into the democratic government of Europe, fully account-able to the European Parliament. We, as socialists, are ready for this debate. We have a natural leader for the Com-mission, Martin Schulz, and we are working on an ambitious manifesto.

Mr Pittella, you talk about po-litical union but, according to many polls, a growing number of voters is likely to support anti-European parties. Perhaps you are too opti-mistic…

I am not too optimistic. I know that the situation is very complicated

but I believe that there is still room to manoeuver to change it. I am not scared of anti-Europeans. The most dangerous enemy of Europe is inaction and a lack of political will. That is why I call for a strong European counterof-fensive. There are still three months before elections. The game is open and we cannot surrender to pessimism.

Who and what should be at the heart of this counteroffensive?

The next Parliament may use all its powers and initiate a process to reform the treaties to build a political and federal Europe. But the creation of a federal Europe should not become an exercise of constitutional law for academics. To make Europe stronger we have to bridge the gap between the European Union and citizens by an-swering the concrete demands com-ing from society. The first demand is growth and jobs.

And what can Europe do to shore up growth?

We have to put an end to auster-ity. I know that some people think that this is too easy an answer but I really believe this dogmatic approach to aus-terity is leading Europe to the brink of disaster. Despite the introduction of austerity debt has increased and the social situation in Southern Europe is extremely precarious. For the first time in contemporary history some Italian cities have experienced deflation.

Challenging austerity means two things. First, it is time to be more flex-

ible with the implementation of the Stability pact. The current investment clause foreseen by the Commission is too weak. Productive public invest-ment should not be taken into account from the calculation of the stability pact.

Second we have to re-open dis-cussions on the introduction of Eu-robonds. On this point, we have to be clear: the level of debt in almost every Eurozone country is unsustainable in the long-term. I am not only referring to Italy, Greece and Portugal but also to countries like France with a debt which accounts for more than 90% of its GDP. With this level of debt, it is very difficult for households and firms to trust in the economic prospects of their countries and, thus, they stop consuming and investing. A mutuali-sation of the debt is necessary for the survival of our economies.

You said you are worried by the effects of austerity in Europe but if Southern European econo-mies suffer, the fault is only related to the austerity measures… Don’t you think there is also a need for reforms?

I acknowledge that Europe’s econ-omies also have structural problems that need to be addressed through bold reforms. However, I do not agree with the rhetoric of structural reforms. I have the impression that people who advocate structural reforms do not want real reforms but only a free mar-ket society. For me structural reforms are something else.

I believe that the battle between global democracy and unregulated fi-nance will be the dividing line of Euro-pean politics in the following decades. Thus, the goal of the next round of re-forms should be aimed at continuing the reform of the financial system, al-ready started by the Parliament such as the banking union and the regulation of the credit rating agencies.

We also need to do more to re-form the banking structure. At the end of January the European Commission proposed a structural reform of the banking sector but this is too little. We need a full separation between invest-

ment and retail banks as we have to stop credit institutions from speculat-ing with the depositors’ money. Pock-eting the profits when business goes well, and making the taxpayers pay when they get into trouble.

You have focused on economic issues but on the headlines of the European newspapers there is Ukraine…

Ukraine is a litmus test to assess Europe’s commitment to support these values. I know the situation as I was in Kiev in the beginning of January and I was shocked by the repression carried out by the authorities.

President Yanucovitch’s offers of political concessions to Euromaiden is a good starting point for a com-prehensive agreement with the op-position but we should not be naive about these offers. If the presidential commitment remains on paper only, we should not rule out the possibility of introducing sanctions targeting the individuals involved in the repression. If the democratic movement fails in Ukraine, we as Europeans all fail. But there is no only Ukraine..

What else then?Ukraine, Syria, Lebanon, Central

Africa, Iran, Egypt, the list is longer but I will stop here. It is clear that the future of Europe as a project of peace and democracy also depends on our ability to contribute to supporting hu-man rights and rule of law all over the world. I am particularly worried by the situation in Africa and by the fact that we tend to overlook what is happening there. If we don’t find a viable solution to the regional conflicts in the sub-Sa-hara, Europe will face a humanitarian tragedy. Solidarity is a crucial Europe-an value we should not forget.

More flexibility for the stabil-ity pact, debt mutualisation, sup-port to the democratic movement in Ukraine: this is a very ambitious agenda but I am not sure that these priorities will be chosen by your country, Italy, that will take over the Presidency in July in a crucial pe-riod for the E.U.

As our President Napolitano rightly pointed out two weeks ago in Strasbourg, Italy will always be a driv-ing force for the European project.

Let me add that now the Italian left has a new dynamic leader, Mat-teo Renzi. I see him as the leader of a new European left which is putting the reform of Europe at the heart of the political agenda. The impact of his leadership on Europe will be huge.

Europe needs a ‘parliamentary coup’Pittella says the left are ready to lead

Gianni Pittella, vice-president of the European Parliament

The most dangerous

enemy of Europe is inaction and a lack

of political will

06 ANALYSIS NEWEUROPEwww.neweurope.eu16 -22 February, 2014

The Commission might be forced to approve a genetically modified maize regardless of how many countries are against it.

Thanks to a little-noticed detail in the Euro-pean Union Copyright Directive, the entire European Union’s legislations on copyright are essentially a mirage without effect. This small detail was rushed through well before the Internet had permeated every aspect of daily business and daily life, and this grave mistake needs to be corrected.

The Commission has announced a round of reviews of, and an update to, the union’s copyright legislation. This is an opportunity to fix the worst mistakes made in all haste before we understood what the Internet would come to be, and before we understood just how much

a special interest the copyright industry repre-sents against the public interest of the future.

The grave mistake in question is a small de-tail in the EUCD that says, paraphrased, “but if publishers don’t like the checks and balances carefully laid out in this law, they can make up their entirely own copyright law, and have that enforced instead”. This mechanism is invoked practically every single time by publishers, and makes everything else moot. Copyright doesn’t expire at all anymore, there is no fair use, and citizens barely have any rights at all - especially not those specifically written into copyright law.

The small detail is spelled DRM, Digital Re-striction Measures.

(Publishers and the copyright industry would like the letters DRM to stand for some-thing else that has a better ring to it, kind of like how crazy people in the USA who murder abortion clinic physicians like to call themselves “pro-life”. As legislators, however, we have a duty

toward the public to call a spade a spade.)The catch lies in a two-pronged approach

from the copyright industry. First, they are using DRM - which is shorthand for technical meas-ures restricting the owner from legitimate and lawful usage of a purchased work - to impose any limits they like, including but not limited to:

- only using the media with certain brands of equipment, in violation of competition rules

- only using the media at certain times of day, or in certain countries

- disallowing lending of the media, even within a family

- making sure exclusive rights (“copyright”) never expire at all, despite what the law says

- preventing the owner from using the same media at home and in the car

- basically prohibiting anything lawful the owner wants to do that the publisher doesn’t like

These rules are embedded by publishers

as technical restrictions as part of the media it-self. The second prong is the fiendish one: the EUCD specifically prohibits disabling any such Digital Restriction Measures, considering such disabling to be a violation of copyright law.

The net result is that publishers have been given the right to make up their own copyright law entirely, through the inclusion and protec-tion of DRM. That’s not acceptable for any country that aspires to have a rule of law and a democracy. It’s important to note that Digital Restriction Measures never prevented copying, nor indeed, were ever intended to. If you have a DRM-infected work like a DVD, you can make a copy of it just fine, and the DRM of the origi-nal will faithfully follow along to the copy. What DRM does, however, is limit and control usage of culture and knowledge, not its copying. And it does so in a way that most audaciously robs citizens of rights they would otherwise have to their own property.

Copyright law today is a mirage and a lie. Let’s make it better

By Dan Alexe

The EU’s General Affairs Council end-ed on Tuesday 11 February on a note of acrimony following the prolonged

impossibility to decide on Commission’s plans to allow pesticide-producing GM maize.

The public debate in the Council of Min-isters, chaired by the Greek Foreign Minister Evangelos Venizelos, and in the presence of the Health Commissioner, the Maltese To-nio Borg, showed that a record number of EU countries oppose the Commission’s initiative, first introduced in 2001.

Nineteen countries voted against the ap-proval of the GM crop (France, Italy, Hungary, Greece, Romania, Poland, the Netherlands, Austria, Bulgaria, Croatia, Cyprus, Denmark, Ireland, Latvia, Lithuania, Luxembourg, Malta, Slovakia, Slovenia,) in a meeting of EU ministers, with only five in favour (Spain, the UK, Finland, Estonia and Sweden) and four abstentions (Germany, Portugal, Czech Re-public and Belgium).

Still, at the end of a heated public debate, the ministers passed the hot potato to the Commission, because of a legal loop, which, in the end might not be the best way to enhance EU citizen’s trust in the institutions.

The loophole is due to the fact that when-ever the ministers cannot reach a qualified majority (as in this case) for or against an ap-plication, the Commission becomes legally bound to accept it. The Commission is thus theoretically forced to approve it, regardless of how many countries were against it.

This means that it is from now left to the Commission to decide whether or not mem-

ber states be given the right to cultivate the ge-netically modified maize crop in question, Pi-oneer 1507, and to sell it on the EU market. In case of an approval by the Commission, every country would be free to cultivate GMOs, or to reject their cultivation. As Commissioner Borg said: “Each state is at liberty to block or to adopt the cultivation, on grounds other than health or environment”.

In order to avoid an institutional dead-end, the obviously reluctant Greek foreign minister Venizelos, who chaired the meeting, decided that no formal vote would take place. Venizelos specifically asked the college of Commissioners to take into account the trend of the intentions of the member countries.

“Since there was no qualified majority for or against (due to the fact that there was no

formal vote)”, said Venizelor, “we now have a political and institutional problem, stemming from comitology and subsidiarity”.

But “comitology” itself should be dead by now and replaced by the Lisbon provisions, al-though “comitology” was mentioned by prac-tically everybody during the debate, a debate that looked at times like a confrontation be-tween Venizelos (anti-GMO) and the Health Commissioner, the Maltese Tonio Borg (to-tally in favour).

Among other supplementary legal tangles that stem from this is also the fact that by be-ing practically forced to adopt an initiative in-troduced by a different Commission 13 years ago, the present Commission is thus losing its right to fully withdraw the initiative.

The Hungarian Minister of State in charge

of EU Affairs Enikő Győri transmitted to the press that the manoeuvre represents a “risk not only to fields, but also to democracy”. “Under the arcane rules of the EU’s commit-tee system, originally devised to provide great-er efficiency in decision-making on technical matters, the Commission can easily sidestep the concerns of member states – even in an is-sue as politically sensitive as this. For, unless a super-majority rallies against the proposal, the Council will be deemed to have had “no opin-ion” and the Commission will go ahead with the authorisation, reneging on its 1999 pledge never to go against the predominant majority in sensitive issues. This procedure is wrong in itself and should be checked.”

“If we don’t act now”, continued Enikő Győri, “it will be too late. Once the floodgates are opened, it is impossible to put the GMO genie back in the bottle. And if we allow a genetically modified seed to be authorised through the backdoor, it will damage the cred-ibility and legitimacy of the entire European Union and risk contributing to a bumper har-vest for EU sceptic parties at the May Euro-pean elections.”

Later in the week, twelve EU ministers (from (Austria, Bulgaria, Cyprus, France, Hungary, Italy, Latvia, Lithuania, Luxem-bourg, Poland, Slovenia and Malta) sent an open letter to the health commissioner, Tonio Borg, pressuring the Commission to withdraw its proposal to approve the genetically modi-fied maize. The signature of the Maltese min-ister is rather remarkable: Commissioner To-nio Borg himself, who pushed hard in favour of the genetically modified crop, hails from Malta.

Crumbling EU: legal loopholes and GMO-fuelled imbroglios

Going round in circles over GMO crops. EPA/SANDRO CAMPARDO ELECTRONIC IMAGE

A member of New Europe’s Knowledge Network

Member of the European Parliament Piratpartiet - The Pirate Party

By Christian Engström, MEP

Pirate Cove

07ANALYSISNEWEUROPEwww.neweurope.eu16 -22 February, 2014

By Dan Alexe

The result of the 09 February referen-dum in Switzerland has stunned the EU. The Swiss have voted 50.3% in

favour of curbing immigration. Many EU poli-ticians reacted with dismay, even bordering on anger. Thus, Luxembourg’s prime minister Jean Asselborn said: “I respect the decision of the Swiss people… but the Swiss people must also respect the values of the EU.”

The same tone was heard from the French Foreign Minister Laurent Fabius, who said on Monday 10 February that Europe would review its relations with Switzerland after the “worry-ing” Swiss vote to reintroduce immigration quotas with the European Union. “In my opin-ion it’s bad news both for Europe and for the Swiss because Switzerland will be penalised if it withdraws,” Fabius said. “We’re going to review our relations with Switzerland,” he said.

The withdrawal in question would be Swit-zerland’s retreat from the Schengen agreement, of which Switzerland is one of the signatories, but which cannot be applied selectively.

Opinions are still split as to whether it is possible to renegotiate with a country that was viewed as being practically the EU’s 29th mem-ber state. “The European Union’s fundamental freedoms of free movement of persons and free movement of goods belong together - you can not have one without the other” said Jo Leinen, German Socialist MEP and President of the European Movement International. ”Swit-zerland cannot expect its goods to continue to flow freely into the huge European market, while it closes its borders to EU citizens. The restriction of immigration from the EU puts all bilateral agreements between the EU and Swit-zerland into question.”

Asked by New Europe about the foresee-able impact of the referendum, Jo Leinen said: “Switzerland and the EU have common inter-ests. It will be absolute disaster if we were now

to turn backwards. What we see is how the right wing populist forces all across Europe bring back their nationalist obsessions and the eter-nal talk of sovereignty. There is a real danger that if Switzerland leaves Schengen we might start dismantling everything that we have built together in the last decades.”

Another legal conundrum appeared imme-diately after the Swiss referendum: Switzerland was meant to imminently sign an agreement with Croatia, since that country’s EU accession in 2013, but now it cannot do it now, after Swiss voters rejected any further extension of the pre-sent agreements.

Both Switzerland and the EU are now in a legal vicious circle: the Swiss authorities cannot bypass the citizens’ vote, and have to wait until the Federal Council (the Swiss government) finds a solution to the imbroglio (it has three years for this). Meanwhile, Switzerland cannot discriminate among EU citizens. That is: Cro-ats cannot be treated differently from the citi-

zens of the other 27 countries. Also, on the day following the referendum,

Monday 10 February, the EU has suspended, in reprisal, the negotiations with Switzerland on electricity. It so happens that the EU would have much more to lose from a possible break-down of the discussions on energy. Whole chunks of southern Germany, like the Länder of Bavaria and Baden-Württemberg, depend on cheap energy from Switzerland.

Some observers are less pessimistic. Thus the Romanian conservative MEP Monica Ma-covei, a legal expert and former prosecutor who is known for her fight against corruption in her own country said: “It was a referendum won by a tiny margin, but still won democratically. This is how democracy functions. The impact of this referendum can be kept limited. The most important actors in Switzerland are against any limitation on immigration from EU and inside Schengen. The government, most political par-ties, the business associations are against and

they have now three years at their disposal to renegotiate. But we have to be vigilant. The EU Commission is still discussing with Switzer-land the exchange of information concerning the fiscal domain and the banking secret. This shouldn’t be touched. We don’t want the Rus-sian mafia going leisurely to stash their money in Swiss banks.”

“I wouldn’t get overexcited over this my-self ”, says on the same tone Marianne Dony, president of the Institut d’études européennes in Brussels. “From a juridical point of view, the situation is rather simple. Switzerland is not a member of the EU, and it is their right to an-nounce that they would not conclude new agreements. But things would become really complicated if the Swiss were to become se-lective and start saying things like: we are per-fectly fine with allowing free movement to the French, Germans and other Westerners, but not, say, to Romanians and Bulgarians. This would empty the treaties of all their substance and produce a domino principle, meaning that by not respecting one clause, they would empty the whole text of its substance.”

Asked by New Europe who would lose most, Marianne Dony considers that both sides would have to lose. “Relatively few Swiss nationals work in the EU, so that wouldn’t nec-essarily pose the same problem to the Swiss. But Swiss companies would risk losing access to EU tenders and public procurement. The Swiss pharmaceutical sector in particular could be badly hit, but also the research and the ser-vices. On the other hand, in the fiscal domain the Swiss have only to win. They could simply go back again to their old bank secrecy and start operating again in a totally opaque manner.”

“After all our efforts over the years”, con-cludes a Belgian diplomat, “with threats and promises of an amnesty, to convince fraudsters to bring their money back from Switzerland, the thing we need least is indeed the Swiss pull-ing back the lid on their coffers.”

The EU would have much more to lose: whole Länder of southern Germany, like Bavaria and Baden-Württemberg, depend on cheap energy from Switzerland.

By Meghan Boggins

The rise of xenophobic parties across Europe is worrying many ahead of the May elections for the European Parliament and migration, from inside and outside the EU has become a central issue.

“We need to return the principle of free movement to a more sensible basis and make it clear that it cannot be a completely unquali-fied right,” the UK leader, David Cameron said, according to the Guardian, at a Brussels summit.

France caused alarm when former Presi-dent Nicolas Sarkozy expelled more than 1,000 Roma immigrants and demolished many Roma camps. In Sweden, the Guardian

reported a march of 20,000 people follow-ing the accession of a far-right party to their parliament, as well as the arrest of a man sus-pected of shooting nine people, mainly of im-migrant backgrounds.

The rise in anti-migration rhetoric is tied to the rise of populist movements in several coun-tries, with far-right groups pushing their agenda on liberal coalitions. In most EU15 countries, these groups have pushed center-right coalitions to call for curbs on free movement, said Julian Priestly in a Policy Network op-ed.

“The strategists among the anti-Europe-ans have realised for some time that by con-

centrating on immigration they can keep eu-roscepticism on the agenda, almost by proxy,” Priestly said.

Other countries voicing their opinions in-clude Germany, which recently complained of EU benefit tourism, Belgium and France both expressed concerns over “social dumping,” in which cheap workers arrive from other coun-tries and undercut local workers or deprive them of jobs. France accused Ryanair of social dumping last October and fined the company eight million euros.

Furthermore, some think there aren’t enough facts to back up the debate. EU com-

missioner Laszlo Andor said the UK’s debate on quotas is based on myths like benefits tour-ism, and that the conversation is being fueled by parties that want the UK out of the EU. Andor cited studies that showed the arrival of immigrants in the early 2000s as having a positive effect on the country, specifically its labour market.

Now that Bulgarians and Romanians have free movement, there is growing concern that there will be another wave of immigrants-- specifically, poor ones.

There is a large gap in wages between rich and poor EU countries. In 2011, on average, company employees were paid 4,668 euros in Bulgaria, 6,146 euros in Romania, 40,045 eu-ros in the UK and 43,300 euros in Germany.

Threats to free movement

After the Swiss referendum: the possible return of bank secrecy

Ja, but now what? AFP PHOTO / MICHAEL BUHOLZER

08 ANALYSIS NEWEUROPEwww.neweurope.eu16 -22 February, 2014

The Creative Society

By Francisco Jaime Quesado

Richard Florida, the Emeritus Professor in Toronto, has a clear message – only with a very strong Creativity So-ciety it will be possible to face this crisis and construct a new agenda of competitiveness for Europe. Creativity is a global trend that crosses different people, firms aand other relevant actors of society towards an agenda of effective ambition. The Creativity Society is the commitment be-tween those who want a different roadmap for the future and those that want to build a new strategic capability for society. The Creativity Society is based on a stronger coordination among the different partners towards action: develop ac-tive policies towards the participation of SME in global networks; reinforce the role of “Clusters of Innovation” as Centers of Excellence for new areas of knowledge (bio-tech, renewables energies, new communications); reinvent the role of Universities as active players in the develop-ment of a culture of competitiveness among civil society; enable the States to progressively eliminate obstacles to investment and innovation;The perspectives faced by the Horizon 2020 are a good example of this new strategic vision for a new agenda of excellence. But it´s not enough. It must be effectively com-plemented with an active participation of policymakers in disseminating the new message for the future. The Porter effect will be an effective and strong enabler to the social and economical development of the institutions and the citizens. That´s why we need new programs, new answers, new solutions.In this way, the extremely positive experience of integrated projects like the “Poles of Competitiveness” and Clusters of Innovation across the different regions should be repli-cated in other European countries. It allows – as it can be confirmed by its results – a very strong commitment be-tween the implementation of a global national economic strategy and specific areas of regional development, which is now considered by the European Union as a key enabler for the future.This new economic strategy demands an effective Partner-ship Contract between all the actors (States, Universities, Companies, Civil Society), in order to build a real Strategy of Confidence in the implementation of the different poli-cies. The focus on Innovation and Knowledge as the driv-ers of creating added value with international dissemina-tion is a unique challenge that may be the answer to a new way of interaction between those who have the responsi-bility of thinking and those that have the responsibility of producing goods and services.It´ s time to believe in a new cycle for Europe. Reinvent-ing the Competitiveness Agenda and giving the European Actors (States, Universities, Enterprises, Civil Society) the opportunity of developing new challenges focused on in-novation and creativity is in a large sense giving a central contribution to the reinvention of Europe. This is the basis for the Creativity Society. This is the basis for a new indi-vidual and collective agenda.

Francisco Jaime Quesado is the General Manager of the Innovation and Knowledge Society in Portugal, a public agency with the mission of coordinating the policies for Information Society and mobilizing it through dissemination, qualification and research activities. It operates within the Ministry of Science, Technology and Higher Education

A member of New Europe’s Knowledge Network

By Dula Bardha

I t is universally accepted that a presi-dent of a republic symbolises the unity of a nation. Whether president

of a presidential or parliamentary republic, he or she is the president of all citizens of his country.

It is also universally accepted that the president of a republic represents the offi-cial state policy and whatever he or she says is official!

Therefore, it goes without saying that the president’s “wrong” actions can pro-voke severe criticism from offended par-ties, both national and foreign.

The president of Romania does not seem to care about this.

Over the past few weeks, Traian Bas-escu has “scored” not one but two foul shots! One was national and the other in-ternational.

At home, Basescu offended Roma-nian citizens who are of Roma descent with some rather sniffy and calumni-ous declarations. Abroad, he reinforced pro-Russian propaganda of the Gagauz leadership in the latest (and illegally de-clared) referendum for independence in Gagauzia, Moldova.

Even though the first instance oc-curred several years ago, a Romanian court has only now rendered a ruling - finding Basescu guilty of insulting Roma.

As reported in the local media last week, the Romanian Commission for Combating Discrimination (CNCD) fined Basescu 600 lei (about €130) for his statement that “there are very few nomad Roma wanting to work; many of them tra-ditionally live on what they pilfer”. He had made the controversial statement at a press conference in Slovenia in 2010.

His statement enraged his Roma citi-zens - the citizens of the country he, as the president, represents.

Back home Basescu tried to avoid any further action under his country’s anti-discrimination law. His lawyers argued that he could not be punished for statements made abroad! At first, the CNCD had re-fused to hear the case against Basescu on the grounds that it was outside its juris-diction. A ruling by the Bucharest Court of Appeal and a decision of the Supreme Court of Romania, however, forced the CNCD to rule on merits.

Roma activists welcomed the CNCD’s decision to fine the president. “This is an important and symbolic act of justice. We hope that this decision will cause other people to stop the discrimination against Roma,” Marian Mandache of Amnesty Romani Crisis was quoted as saying by the local media.

Anyhow, the president has never liked Roma. It was not the first time he insulted

them. In May 2007, he called a reporter who tried to photograph him and his wife while shopping a “stinking Gypsy”.

Official statistics put the number of Roma living in Romania at about 620,000, but the actual number is believed to be at least twice as high.

Last year, Romanian citizens of Roma descent were the target of discriminatory actions in France and in other European Union countries. In the far-right terminol-ogy, any and every Romanian is consid-ered a Roma. Since January when Romani-an and Bulgarian citizens secured the right of free movement in the EU, many racists and xenophobes have been quick to equate Romanians with Roma.

Statements like the one made by Bas-escu in Slovenia are nothing but arrows in the quiver of xenophobes and, in this case, anti-Romanian philology.

Meanwhile, Basescu has made an even more dangerous statement that can have tremendous international consequences.

On the eve of an ambiguous referen-dum organised by local authorities in the autonomous region of Gagauzia in Mol-dova where voters were asked to decide on their right for independence (something that is backed by Russia), Basescu scored his second foul shot.

The Gagauz leadership said that Mol-dova’s rapprochement to the EU could put the country at risk of being swallowed up by Romania. The Gagauz, a people of Tur-kic origin, feel strange among the Roma-nian-speaking Moldovan nationals. From their point of view, the Moldovan govern-ment has done little to ease this concern and to defend the integrity of Moldovan territory now and in the future.

Only Moscow-backed media and politicians insist on the legitimacy of the

Gagauz’ leadership concerns. But it wasn’t only them. Basescu has also declared on several occasions that Moldova is a target in Romanian politics.

On November 27, for instance, Bas-escu said: “I am convinced that if there will be a unionist movement in Moldova, Romania will say ‘yes’ without hesitation”.

On New Year’s Eve, he said: “The year 2014 must be the one to say honestly and openly that Moldova is Romanian land”.

And finally, on January 7, Basescu made headlines with yet another state-ment. Speaking on Romanian television, he said: “In Romania, there has to start an internal debate about whether Romanians agree or not with the union with the Re-public of Moldova, a debate that doesn’t have to concern the politicians in Moldo-va. Why? In the event a turn of Moldova towards the Eurasian Union is predictable, Romania has the obligation to offer Mol-dova the possibility to continue its Europe-an course through a union with Romania (…) Romania has to offer this alternative”.

Is Basescu obsessed with Moldova? Probably. On another occasion, for in-stance, he had said that when he retires from office he will dedicate the rest of his life to Romania-Moldova unity!

Are these kind, noble and patriotic views? Probably not. Most likely they are a danger for the stability in the region.

Basescu’s statements should mobilise an EU reaction. His statements are a threat to the integrity of a state which believes in and trusts the EU and its future course within EU institutions.

Basescu’s statements are also an insult to all European citizens. It is a shame that a president of a European country uses such scornful and defamatory terms against some of these citizens.

Anger rises after leader’s clumsy interventions at home and abroad. AFP PHOTO/ABBAS MOMANI

A not-so exemplar president: the latest feats of Traian Basescu

09ANALYSISNEWEUROPEwww.neweurope.eu16 -22 February, 2014

NATO’s new frontier

BRUSSELS – An American ship sailing into a Spanish naval base this week is mak-ing history. The arrival of the USS Donald Cook from Norfolk, Virginia, to its new home port in Rota, on Spain’s Atlantic coast, marks the first time that a US Navy ship equipped with the high-tech Aegis ballistic missile-defense system will be permanently based in Europe.

The USS Donald Cook is the first of four US Navy destroyers that, with around 1,200 sailors and personnel, will play a central role in NATO’s missile-defense capability. But the ships will carry out many other tasks as well, such as maritime security operations, bilateral and multilateral training exercises, and participation in NATO operations and deployments, including the Standing NATO Maritime Groups.

The arrival of the USS Donald Cook marks a step forward for NATO, for European security, and for transatlantic cooperation. It clearly demonstrates the strength of the bond between America and Europe in dealing with the complex and unpredictable security challenges of our age.

Steady progress has been made since November 2010, when, at its Lisbon summit, NATO decided to develop a missile-defense capability to protect all NATO European populations, territory, and forces. In April 2012, at its summit

in Chicago, NATO announced an inter-im capability as an operationally signifi-cant first step. Full capability is expected to be attained in the years ahead.

The purpose of NATO’s missile-de-fense system is to defend Europe against a real threat. At least 30 countries around the world either have ballistic missiles or are trying to acquire them. The know-how needed to build them is spreading, and their range is increasing, with some from outside the Euro-Atlantic region already capable of targeting European cities.

The USS Donald Cook and the three other US destroyers have advanced sen-sor capabilities and interceptors that can detect and shoot down ballistic missiles directed at Europe. In the future, other important components of the missile-defense system will include additional radars, sensors, and interceptors – and more ships.

Already, thanks to the US European Phased Adaptive Approach to missile defense, NATO can rely on a powerful radar based in Turkey. Work has already begun on construction of a land-based interceptor and radar site in Romania. Poland has announced plans to build up its air and missile-defense capabilities. The Netherlands is upgrading four radar frigates to make them capable of missile defense, and has offered its Patriot anti-missile systems. So has Germany.

The Netherlands, Germany, and the US have already deployed Patriot mis-siles on NATO’s southeastern border to help defend and protect Turkey from possible missile attacks from Syria. And, by hosting the four US Navy destroyers, Spain is making a vital contribution not

just to NATO’s missile defense, but also to security throughout the Mediterra-nean region.

To link all of these national assets together, NATO has developed, and is expanding, a technologically advanced command-and-control system, based at Ramstein Air Base in Germany. The system already can connect satellites, ra-dars, and interceptors to defend against missile attacks, and that capability will grow more complex and agile in the years ahead. This makes NATO unique: it is the only multilateral organization that can combine the most complex systems from the world’s most capable countries to create an effective whole.

Above all, this deployment is a step forward for transatlantic cooperation, because the US ships represent more than a military capability. Each one is an eight-thousand-ton reminder of Ameri-ca’s commitment to security in Europe.

At the same time, NATO’s missile defense demonstrates European allies’ commitment to security as they develop their capabilities in this area. I encour-age all allies to consider how they can contribute further to a system that will defend all of us in Europe.

Missile defense heralds a new form of cooperation, with new capabilities against new threats. Where once we lined up tanks along borders, we are now building a complex system that requires a range of high-tech contributions from many allies – on land, at sea, and in the air. NATO’s missile-defense system is what transatlantic teamwork looks like in the twenty-first century.

Copyright: Project Syndicate, 2014. www.project-syndicate.org

It’s time to end Africa’s celebrity Hell

By Andy Carling

Constructive Ambiguity

Is there no end to Africa’s suffering? Well, there is some-thing we can do to improve the lives or Africans and to raise people’s understanding of the continent.We can ban celebrities from travelling there. It seems to be the top destination for celebrities needing a touch of PR. Perhaps the tabloids have papped them in the bushes with the kids nanny, or their assistants are more per-sonal in their assistance than stated in the job description. Others just want to go shopping for babies.Either way, it’s time to step up and stop celebrity exploi-tation. The offenders are the professional good hearts, the messiahs of misery, the NGOs. They exist to Do Good. Now that is trickier than you may think, especially as all the big donors, governments, who have essentially privatised the aid industry but can ask a lot of awkward questions about how the money was spent.So, the NGOs wanted large sums of cash from people who would not know much and ask fewer questions. Hello gen-eral public! And so the need for ‘raising awareness’ began. This is how it works, you find an issue, frame it in such a way as to extract the most cash from those who know the least and raise funds, sorry awareness.But ‘raising awareness’ is an end of itself these days, but what is the value, beyond cash donations?It is impossible, in a globalised world to be aware of more than a tiny fraction of what is happening on the planet. And if we know, say that X% of a defined age group in Country Y have illness Z, how are we to respond?Is it worse than X-1% having illness B in country C?You see the problem. It seems that some grim league table of suffering is the re-sult of raising awareness.Stop Kony. Remember that, where messianic youth sud-denly became experts on a deeply complex and long run-ning issue within mere seconds of watching a glossy video. In fact there was a good reason the video was glossy: al-most all the funds were spent of flying the staff and cameras around the world.Awareness raising always results in offering simplistic solu-tions to people who won’t ask awkward questions, about the organisation or how it spends the cash.The trend really got silly when God told Christian Aid to send the winner of the first UK Big Brother bore-a-thon to Jamaica. Poor bloke ran away in tears, utterly horrified at being outside Sarf London.There have been a string of such incidents since, most re-cently with someone who plays posh totty on TV, Eliza-beth McGovan behaving stupidly, but she did get one thing right, she asked the charity’s pr minders, “I need to know what distinguishes World Vision from its competitors?” For she understands, vaguely admittedly, that this is about a competition for resources: people’s cash.In the meantime, the white people can fuss over suitably photogenic black babies.And nirvana can strike, as it did Madonna, “I thought, ‘I have to help. I have to save these people.’ And then I thought, ‘Wait a minute; I think it’s the other way around. I think they might be saving me.”Now let’s save everyone from these people. Step one is to remove Bono’s passport.

Secretary General of NATO

By Anders Fogh Rasmussen

USS Donald Cook is moored at Funchal, Portugal for a routine refueling on her way to Rota, Spain. Donald Cook is underway en route to Rota, as the first of four Arleigh Burke-class guided-missile destroyers to be stationed in Rota. (U.S. NAvy Photo By MASS CoMMUNiCAtioN SPeCiAliSt 2ND ClASS ANDRew B. ChURCh/ReleASeD)

10 ANALYSIS NEWEUROPEwww.neweurope.eu16 -22 February, 2014

Let me start with two examples: A few years ago, one of the largest German public banks agreed on a new code of

conduct for a better, more ethical culture in the company. Shortly before that time, prose-cutors had started an investigation against one of the bank’s top managers, which eventually resulted in an 8 years prison sentence on the charge of corruption. Would this manager’s criminal energy have been reined in by an eth-ics code? Most probably not.

At roughly the same time, after a large-scale corruption scandal, another large mul-tinational corporation decided on a cultural change in the way it would be doing business in the future. Less than two years later, its CEO declared the change completed. After this short period of time, it nonetheless seems highly unlikely that thousands of managers had adopted ethical values and adapted their leadership.

If companies are to engage in a change of culture towards sustainable, ethical and fair management, it takes much more than just declaring it. And it takes much more than streamlined CSR reports and strict compli-ance. What we need is value-driven leader-ship in all parts of business. Still, business and human values are too often perceived as two separate worlds. It sometimes even goes so far that in some sectors unethical behaviour becomes a structural element. In the financial sector, it now looks as though no lessons have been learnt from the crisis of 2008. Trade with

toxic papers and short-term, high-risk specu-lation have reached the same if not higher lev-els as in the years before the breakdown.

But employees have greater and greater expectations regarding ethical leadership. A study showed that in the financial sector, 72% of managers had to act against their ethical values at least once. This figure shows that the values are present but that the system and

the lack of ethical leadership undermine them. We need to build on these values that are still there but that are at risk of being lost in the globalised economy.

The financial crisis erupted because of a fixation on short-term profit and a lack of transparency and accountability. This is what economics students were taught was the right behaviour. Like we teach our children to live

by the values of our society and to show re-spect towards others, our schools and univer-sities must teach the managers of tomorrow a new, value-driven business culture. We need curricula in which they are taught that a yearly profit margin of 15% cannot be made without a cost to others and to society and in which they learn to stand up to unethical business decisions in their company.

And we also need a political climate in which this new value-driven business gets the support it needs. In the European Parliament we have passed several resolutions asking for more transparency, more accountability, and urging companies to integrate social, environ-mental and ethical concerns into their busi-ness models.

I am therefore very happy to see that new initiatives have emerged lately, such as the Ethical Leadership Curriculum by the World Forum for Ethics in Business.

When you look at the two examples from the beginning and at what it takes to really make a change towards ethical leadership, you realise that a lot still needs to be done. But we are on a good way. Initiatives all around the world are emerging in Civil Society, like the World Forum for Ethics in Business. These movements are a very important part of cul-tural change towards more ethics in business. They are a forum to communicate ideas and to show good practices and are creating a mo-mentum that will drive the business world to-wards value-driven and ethical leadership.

By Paul Schemm, Associated Press

RABAT — Morocco is abusing sub-Saharan mi-grants, especially those trying to force their way into the Spanish enclaves on its coast, despite an-nouncing a more humanitarian immigration pol-icy last year, Human Rights Watch said Monday.

Migrants seeking to enter the Spanish en-clave of Melilla on Morocco’s coast told the rights group they were tied up and beaten by both Mo-roccan forces.

“We are not asking Morocco to adopt any new initiatives. It’s just a matter of respecting the agreements they have already made,” said Eric Goldstein, deputy director of the group’s North Africa division.

Morocco, a major transit point for immi-grants with an estimated 25,000 sub-Saharans living there illegally, announced a new immigra-tion policy in September involving greater re-spect for human rights.

Europe has encouraged Morocco to do more to stop the migrants.

The bodies of seven migrants were recovered last week off the coast of the Spanish enclave of Ceuta after hundreds tried to force their way in.

Witnesses said Spanish forces used rubber bul-lets. “We are shocked by this tragedy, and we hope there will be an investigation into the secu-rity measures that witnesses said included the use of rubber bullets,” said Katya Salmi, the report’s main researcher.

The rights group said the Moroccan policy of expelling migrants to Algeria appears to have

ceased. Instead many are bused to other Mo-roccan cities and left there. An aid organization confirmed that since December sub-Saharan mi-grants have been dumped on a daily basis around the capital. “We are in a situation of permanent crisis,” a representative of the organization said on condition of anonymity because of the sensi-tivity of the information.

Critics: Morocco’s abuse of migrants persists

A member of New Europe’s Knowledge Network

Business as usual or a new basis for ethical leadership?

KABUL - Afghan locals in Baraki Barak district of eastern Logar province have made uprising against Taliban militants, authorities said on Monday. “The residents of the Cheltan area of Ba-raki Barak district made uprising against Taliban militants and vowed to resist any-one who prevents children to go to school or blocks people participation in the com-ing elections,” the district governor, Rahim Amin, told Xinhua. More than 1,000 residents took up arms to drive out the militants from their villages in the province 60 km south of national capi-tal Kabul, the official noted. Taliban militants who have been fighting the government and lashing at government-run schools have termed the elections as “ waste of time” and vowed to disrupt the electoral process. (Xinhua)

Locals make uprising against Taliban in Afghan town

Ethical financing for ethical business is the futire says MEP. AlEx Guibord

demonstration in Puerta del Sol in Madrid on February 12, 2014 against the deaths of 11 people who drowned trying to swim to the Spanish exclave from Morocco last week. AFP PHoTo/ GErArd JuliEN

Member of the European Parliament, President European Movement International (EMI)

By Jo Leinen

World Forum for Ethics in Business

11ANALYSISNEWEUROPEwww.neweurope.eu16 -22 February, 2014

PRINCETON – How quickly emerging markets’ fortunes have turned. Not long ago, they were touted as the salvation of the world economy – the dynamic engines of growth that would take over as the economies of the United States and Europe sputtered. Economists at Citigroup, McKinsey, Pricewaterhouse-Coopers, and elsewhere were predicting an era of broad and sustained growth from Asia to Africa.

But now the emerging-market blues are back. The beating that these coun-tries’ currencies have taken as the US Federal Reserve begins to tighten mon-etary policy is just the start; everywhere one looks, it seems, there are deep-seat-ed problems.

Argentina and Venezuela have run out of heterodox policy tricks. Brazil and India need new growth models. Turkey and Thailand are mired in political cri-ses that reflect long-simmering domestic conflicts. In Africa, concern is mounting about the lack of structural change and industrialization. And the main ques-tion concerning China is whether its economic slowdown will take the form of a soft or hard landing.

This is not the first time that devel-oping countries have been hit hard by abrupt mood swings in global financial markets. The surprise is that we are sur-prised. Economists, in particular, should have learned a few fundamental lessons long ago.

First, emerging-market hype is just that. Economic miracles rarely occur, and for good reason. Governments that can intervene massively to restruc-ture and diversify the economy, while preventing the state from becoming a mechanism of corruption and rent-seeking, are the exception. China and (in their heyday) South Korea, Taiwan, Japan, and a few others had such govern-ments; but the rapid industrialization that they engineered has eluded most of Latin America, the Middle East, Africa, and South Asia.

Instead, emerging markets’ growth over the last two decades was based on a fortuitous (and temporary) set of ex-ternal circumstances: high commodity prices, low interest rates, and seemingly endless buckets of foreign finance. Im-proved macroeconomic policy and over-all governance helped, too, but these are growth enablers, not growth triggers.

Second, financial globalization has been greatly oversold. Openness to capital flows was supposed to boost domestic investment and reduce mac-roeconomic volatility. Instead, it has ac-

complished pretty much the opposite.We have long known that portfolio

and short-term inflows fuel consump-tion booms and real-estate bubbles, with disastrous consequences when market sentiment inevitably sours and finance dries up. Governments that enjoyed the rollercoaster ride on the way up should not have been surprised by the plunge that inevitably follows.

Third, floating exchange rates are flawed shock absorbers. In theory, market-determined currency values are supposed to isolate the domestic econ-omy from the vagaries of international finance, rising when money floods in and falling when the flows are reversed. In reality, few economies can bear the requisite currency alignments without pain.

Sharp currency revaluations wreak havoc on a country’s international com-petitiveness. And rapid depreciations are a central bank’s nightmare, given the inflationary consequences. Floating exchange rates may moderate the adjust-ment difficulties, but they do not elimi-nate them.

Fourth, faith in global economic-policy coordination is misplaced. Amer-ica’s fiscal and monetary policies, for ex-ample, will always be driven by domestic considerations first (if not second and third as well). And European countries can barely look after their own common interests, let alone the world’s. It is naïve for emerging-market governments to expect major financial centers to adjust their policies in response to economic conditions elsewhere.

For the most part, that is not a bad thing. The Fed’s huge monthly purchas-

es of long-term assets – so-called quanti-tative easing – have benefited the world as a whole by propping up demand and economic activity in the US. Without QE, which the Fed is now gradually ta-pering, world trade would have taken a much bigger hit. Similarly, the rest of the world will benefit when Europeans are able to get their policies right and boost their economies.

The rest is in the hands of officials in the developing world. They must re-sist the temptation to binge on foreign finance when it is cheap and plentiful. In the midst of a foreign-capital bonanza, stagnant levels of private investment in tradable goods are a particularly pow-erful danger signal that no amount of government mythmaking should be al-lowed to override. Officials face a sim-ple choice: maintain strong prudential controls on capital flows, or be prepared to invest a large share of resources in self-insurance by accumulating large foreign reserves.

The deeper problem lies with the excessive financialization of the global economy that has occurred since the 1990’s. The policy dilemmas that have resulted – rising inequality, greater vola-tility, reduced room to manage the real economy – will continue to preoccupy policymakers in the decades ahead.

It is true, but unhelpful, to say that governments have only themselves to blame for having recklessly rushed into this wild ride. It is now time to think about how the world can create a saner balance between finance and the real economy.

Copyright: Project Syndicate, 2014. www.project-syndicate.org

Dr. Greg Austin, Professorial Fellow, the EastWest Institute (New York)

Death by Finance

Traders work on the floor of the New York Stock Exchange on February 10, 2014 in New York City. SpENCEr plaTT/GETTY ImaGES/aFp

Berlin and Computopia

By Greg Austin

On 31 January this year in Munich, the German President, Joachim Gauck, raised the idea of more robust leadership by his country in shaping the global future. I have a suggestion. It would see new leadership initiatives grafted on to well-established poli-cy, while also advancing German economic interests. It is an area where the country could assume moral leadership that few other major economies can, while mapping out innovative pathways for Third World development.Germany could become the new architect-in-chief of an invigor-ated “computopia” project. The vision was laid out by a Japanese sociologist Yoneji Masuda who coined the word in 1980 and helped set in train the idea of an information society, so named because of the transformational potential of new information technologies and applications. The international community em-braced the goal beginning in 2003 with a world summit but it has done too little to deliver on its promise for disadvantaged com-munities and poorer countries.Germany adopted the idea of an information society early. In terms of comprehensive global engagement in this field, the country re-ally kicked itself into higher gear only in 2008 when the govern-ment approved a report on “Strengthening Germany’s role in the global knowledge society”. The strategy commits Germany “in due course” to apply advanced information technologies to its devel-opment partnerships with poorer countries, as well as staking out leadership positions in industry inside developed country partners.By January 2014, some new ethical elements had been added to Germany’s vision of the global information society. They includ-ed the need to protect the internet and other forms of electronic communication from pervasive intrusion by states. This diplo-matic goal and related objectives were evident in the Germany-Brazil draft resolution at the United Nations in November 2013 regarding online privacy. The same objectives figure in the Coali-tion agreement between the CDU, CSU and SPD of November 2013. At the same time, the latter document contained a heavy commitment to boosting innovation in Germany and achieving a global effect for it. This innovation intent depends on a deepen-ing of the information society—in Germany and globally.Germany continues to work at matching outcomes to ambitions in this area of policy, and like most states, has difficult choices yet to make. Even with much work still to be done, there has never been a greater need or a better opportunity for a country like Germany to take a policy lead on the ethics and practicalities of helping poorer countries work more quickly toward a global in-formation society. Germany does not doubt its ability to lead either on the technolo-gies or the economics. It is the fourth biggest national economy in the world. It sits at the centre of the European Union, an economy that in 2013 was close to par in GDP with the United States (on PPP estimates). It has technology in its DNA in a way that most of the other actors in international development assistance do not.On the moral side, as President Gauck said, it takes a little more prodding for Germany to take a lead on big social issues of the day. It can do this for the information society because its hands are clean on the privacy aspects issue of a free an open internet. But there is another reason. Gauck’s speech made a strong rhe-torical reference to “this Germany”, a turn of phrase which allows people to concentrate much more on what the Germany of today can do without being held back by memories of darker times.There can be no easier path for “this Germany’s” future global lead-ership than a high priority field of collective human endeavor that has emerged almost entirely since the early 1990s, especially through the internet—a timing that puts this field of international policy more out of reach of shadows of the past than almost any other.

EastWest Institute

A member of New Europe’s Knowledge Network

Professor of Social Science at the Institute for Advanced Study, Princeton, New Jersey, is the author of The Globalization Paradox: Democracy and the Future of the World Economy.

By Dani Rodrik

12 EnErgy & climatE NEWEUROPEwww.neweurope.eu16 -22 February, 2014

Gazprom closes in on Chinese gas dealBy Kostis Geropoulos

M oscow and Beijing have reached a political understanding for Russian gas giant Gazprom to supply gas to

China and the agreement will be signed once the contract details are settled, sources close to Gazprom told New Europe on 11 February.

Russian President Vladimir Putin met his Chinese counterpart Xi Jinping in Sochi on 6 February before the official opening of the Win-ter Olympic Games in the Black Sea resort.

“In fact, the project has had its political ‘blessing’ already, and what is being discussed now are the contract details, including those on pricing issues. The contract will be signed once all the details, including the technical ones, are settled,” the sources told New Europe.

Experts assume that Gazprom would do its best to try and get the final draft by May so that Putin can sign it during his planned trip to the Asian country.

In January, Gazprom Chief Executive Of-ficer Alexey Miller met with China National Pe-troleum Corp (CNPC) Chairman Zhou Jiping in Beijing.

Gas price remains a main obstacle as the two countries negotiate a natural gas supply deal. Gazprom has sought a breakthrough in talks on building a pipeline to China, the world’s biggest energy consumer, for more than 15 years. The two state-controlled energy giants signed the first framework accord in 1997, with talks stall-ing since over prices.

Alexei Kokin, a senior oil and gas analyst at UralSib Financial Corp, told New Europe on 11 February that if Gazprom manages to secure a deal based on the European price it will be a success.

Pipeline gas is different from liquefied natu-

ral gas (LNG) and there is not much certainty over this gas market seven-eight years from now, he said, adding that the Chinese are increasingly cautious and noncommittal. “China is less ready to commit itself to large purchases at a price that would be tied to Europe which is not really Chi-na’s reference market. So it’s understandable,” Kokin said.

Regarding the oil agreement reached be-tween China and Russia, he explained that oil is a different commodity and China doesn’t have that much leverage over pricing. “China is very much interested in making sure that physically there is no shortage of crude pumped via the pipeline so they were quite happy to give the pre-

payment to Rosneft,” Kokin said.Meanwhile, the UralSib expert said that a

potential gas deal between Russia and China would not affect Gazprom’s gas supplies to Eu-rope since East Siberian gas and Sakhalin gas are sources that would never reach Europe.

“I think, at least in the short term, there is not going to be much competition as far as pipeline gas goes because Gazprom has some spare ca-pacity in the existing system and the East Sibe-rian gas and Sakhalin gas is naturally destined for China rather than Europe,” Kokin said.

But Gazprom faces mounting international and domestic competition in the LNG market. New supplies are expected to come on stream

over the next decade from Australia, the US, Canada, and offshore east Africa. All these pro-jects are aimed at Asian demand.

On the domestic front, recent moves in Moscow have put pressure on Gazprom from state-controlled Rosneft and independ-ent producer Novatek. The gas export liber-alisation bill signed in early December breaks Gazprom’s longstanding monopoly on LNG exports. Rosneft and Novatek are eager to secure contracts with energy-hungry Asia-Pacific consumers, especially China. Novatek recently reached an LNG supply deal with CNPC, which allows it to go ahead with its Arctic Yamal LNG project.

Sanctions on Iran will be lifted eventually and lawmakers have therefore started opening the door to investors, Mehdi Hossein, a contracts supervisor for Iran’s Oil Ministry, told report-ers on 9 February.

Iranian lawmakers authorised the Oil Min-istry to sign buy-back agreements with private or state-owned investors worth as much as $5 billion for the next fiscal year, which in Iran starts on 21 March. Iran’s buy-back contracts call on companies to pay for exploration and work to recover costs through production, news agencies reported.

Iran is developing new hydrocarbon con-tracts that are “in line” with international prac-tice and law and will offer more flexible terms than those Iraq uses, Hosseini said. “We want oil companies to be involved in joint fields and high-risk fields,” Hosseini told the Tehran news conference. “We are looking at longer-term commitments so that our own compa-nies can learn alongside foreign companies.”

Iran, the fifth-largest Organization of Petroleum Exporting Countries (OPEC) member, is discussing limits to its nuclear pro-gramme to remove Western sanctions against

its financial and energy businesses. Iran will resume negotiations with world powers over its nuclear activities on 18 February.

On 11 February, Iranian President Has-

san Rouhani spoke in Tehran’s Azadi Square to mark the 35th anniversary of Iran’s Islamic revolution, calling for “fair and constructive” nuclear talks.

“Iran is determined to hold fair and con-structive talks within the framework of inter-national regulations and we hope to see such an intention on the other side as well,” Rou-hani said.

He added that the talks must be “based on good intentions and peacefulness,” and dismissed any perception of military threats against Iran. “If some have the illusion that there is a threat against the Iranian nation on the table, we say they need new eyeglasses,” Rouhani told the rally in Tehran. “There is no military threat against the Iranian nation.”

Rouhani added that his country’s path “to-ward the peak of progress, science and tech-nology, including peaceful nuclear technol-ogy, will be continuous”.

Since taking office in August, Rouhani has eased the isolation Tehran endured under Mahmoud Ahmadinejad. He spoke by phone with US President Barack Obama, made con-cessions that led to a tentative nuclear agree-ment, and visited Davos’ World Economic Forum. Iran has repaired with the UK, and several ministers and businessmen are visiting Tehran.

Iran to offer luring oil exploration terms to attract investors

Russia’s President Vladimir Putin, left, welcomes his Chinese counterpart Xi Jinping during their meeting in the Russian Black Sea resort of Sochi, 6 February 2014. AFP PHOTO/RIA-NOVOSTI/POOL/ALEXEI NIKOLSKY

Iranian President Hassan Rouhani waves as he delivers a speech during a rally in Tehran’s Azadi Square (Freedom Square) to mark the 35th anniversary of the Islamic revolution, 11 February 2014. AFP PHOTO/ATTA KENAR

13EnErgy & climatENEWEUROPEwww.neweurope.eu16 -22 February, 2014

GDF Suez said a US decision on gas ex-ports opened the door for the French com-pany to enhance its position in the growing US natural gas market.

GDF Suez Chairman Gerard Mestral-lat said he welcomed the decision on 11 February by the US federal government to allow consortium Cameron LNG, LLC to export liquefied natural gas (LNG) pro-duced in the US from the Cameron LNG project in Louisiana to countries that don’t have a US free-trade agreement (FTA).

“The decision of the Department of Energy to grant non-FTA approval opens a major opportunity for GDF Suez to fur-

ther develop long-term LNG sales in a fast-growing global market,” Mestrallat said in a statement. “Cameron LNG will open new horizons for US gas production that is dra-matically boosted by the shale gas revolu-tion and will strengthen GDF Suez’s posi-tion in the LNG world market,” he added.

The completion of the environmental impact assessment by the Federal Energy Regulatory Commission (FERC) is ex-pected in the coming weeks as the last gate before FID. The US Energy Department said on 11 February the decision, which is still subject to environmental review and regulatory approval, authorises the export

of as much as 12 million tonnes of LNG, per year for a period of 20 years.

GDF Suez in May signed a joint ven-ture agreement with US natural gas com-pany Sempra and Japan’s Mitsubishi and Mitsui to develop the Cameron LNG pro-ject. Under these agreements GDF Suez will hold a stake of 16.6% in the Project and will have a long-term liquefaction ca-pacity of 4 million tonnes per year, which will enhance the Group’s LNG portfolio. The facility should be commercially op-erational in 2018.

GDF SUEZ is a global LNG player and the main LNG importer in Europe.

Gazprom Neft, Schlumberger target Siberian shaleOn 10 February, Gazprom Neft,

the oil subsidiary of gas com-pany Gazprom, said it signed

an agreement with oilfield services company Schlumberger to examine shale reserves in Western Siberia. Both sides signed a framework agreement on technology co-operation for shale oil reserve areas in the Khanty-Mansi autonomous district in Western Siberia.

Gazprom Neft said it was drawing on Schlumberger’s experience to de-velop hard-to-extract shale oil reserves, mainly from Bazhenov deposits in Western Siberia.

In the near future, the companies will cooperate on Gazprom Neft plans for the development of Bazhenov-Abalaksky group at the Palyanovskaya area of the Krasnoleninskoye field, and later, co-operation will extend to other projects for development of non-con-ventional oil reserves in Khanty-Mansi Autonomous District.

The expertise that Gazprom Neft will acquire from these activities shall be combined with the experience that Schlumberger gained from the opera-tions at the Bazhenov-Abalaksky group in Western Siberia, as well as from the development of shale oil reserves worldwide.

As a technology partner, Schlum-berger will provide Gazprom Neft with proven technical solutions backed by the experience and expertise of Russian and global Schlumberger unconventional resources experts. Representatives of Gazprom Neft and Schlumberger will be members of the Joint Coordinating Committee, which will determine the strategy, objectives and performance indicators in the implementation of Bazhenov formation development pro-jects. Schlumberger experts shall also participate in the Gazprom Neft Scien-tific and Technical Council meetings re-lated to the Bazhenov-Abalaksky group

projects.Currently, Gazprom Neft explores

shale oil deposits in three projects. In summer 2013, Gazprom Neft ap-proved the program for further study of the Bazhenov-Abalaksky shale oil group of the Palyanovskaya area of the Krasnoleninskoye field (being devel-oped by Gazpromneft-Khantos). The exploration programme includes drill-ing of four directional wells to depths of 2,700—2,800 metres until autumn 2014. Drilling of the first well started in December 2013.

Gazprom Neft is also gaining ex-perience in developing similar reserves through Salym Petroleum Develop-ment (SPD), a 50/50 joint venture with Shell.

In January, SPD announced drilling of the first horizontal appraisal well for

exploring the Bazhenov Formation at the Upper Salym. In 2014—2015, SPD plans to build five similar wells using multistage hydraulic fracturing technol-ogy. Moreover, in 2013, a second joint venture of Gazprom Neft and Shell was formed, which will operate new pro-jects of exploration and development of shale oil deposits in the Khanty-Mansi Autonomic District.

In December, Russian energy ma-jor Rosneft inked an agreement with its Norwegian counterpart Statoil to ex-plore the shale oil potential in the Ural mountains of Russia.

Shale development in Russia is in its early stages. Hydraulic fracturing and horizontal drilling, two drilling tech-nologies used for shale reserves, has led to an oil and natural gas boom in North America.

Lower Oil Prices Won’t Upset Slick Putin

By Kostis Geropoulos

Energy Insider

Claims that $80 oil would lead to an economic crisis in Russia and an end to the presidency of Vladimir Putin are not true, Chris Weafer, a senior partner with consultancy Macro-Advi-sory in Moscow, wrote in an e-mailed note to investors on 14 February.“One of the frequently heard criticisms about Russia is that the economy and socio-political stability are completely dependent on the price of oil,” Weafer wrote. “In recent weeks, in the run up to the Olympics, there have been several articles published claiming that at an average of $80 per barrel for Urals crude, economic growth would collapse and lead to social instability which would, in turn, bring about radical political change and an end to the Putin presidency. It would not. The short answer is that oil averaging down to $80, possibly to $70, per barrel would do neither,” the Moscow-based expert wrote.But Julian Lee, senior energy analyst at London’s Centre for Global Energy Studies (CGES), told New Europe on 14 Feb-ruary that an $80-per-barrel oil price, were it to persist for any length of time, will undoubtedly cause real difficulties for the Russian economy. The country is heavily reliant on tax rev-enues from the oil and gas sector to fund expenditure. Russia needs an oil price of at least $100 per barrel to fund planned spending from current income, without drawing on reserves. “Like many big oil and gas-dependent countries, it could weather a short period of lower prices, but it is unable to boost production to offset such a fall and economic problems would quickly begin to emerge,” Lee said.Weafer wrote that the Russian ruble will partly compensate for lower oil. “If the price of Urals were to slide sharply the ruble would also be allowed to weaken against the dollar to protect budget ruble revenue. We saw this in 2012 when Urals fell quickly from $120 per barrel to $90 per barrel. We should get the same response again in the event of an oil price slide,” Weafer wrote, adding that the weak ruble is already helping. He noted that an oil price drop would increase the budget defi-cit and the domestic and foreign public debt. Moreover, the lower ruble rate would add to inflationary pressures.But, lower oil would also bring some benefits, including in-creasing pressure to restructure budget spending so as to cut or reschedule less productive spending in favour of spending which might boost economic activity. The privatization pro-gramme would likely pick up again. Moreover, there would be more support for plans to reform the pensions system and to regulate the insurance market so as to help build a bigger pool of domestic long term capital, Weafer wrote. Furthermore, lower oil would reduce the current complacency within gov-ernment and help accelerate efforts to improve the investment and business climate, he wrote.Turning to politics, Weafer noted that there is no evidence of a loss of support for Putin. Lower oil, if only down to $80 or even $70 per barrel, would not materially change the political landscape. Suggestions that public support for Putin is falling are also not supported with the evidence, Weafer wrote, point-ing out that Saudi Arabia would be in more trouble than Russia and sooner. KGeropoulos@NEurope.eu follow on twitter @energyinsider

GDF Suez to export LNG from the Cameron project in US

Gazprom Neft said it was drawing on Schlumberger’s experience to develop hard-to-extract shale oil reserves. GAZPROM NEFT

14 EU-WORLD NEWEUROPEwww.neweurope.eu16 -22 February, 2014

A new report by human rights watchdog Amnesty International details the ethnic cleansing of Muslims in the Central African Republic. The group says that militia attacks have resulted in a “Muslim exodus of historic proportions”. According to Amnesty International, the in-ternational community has failed to respond to the crisis and to protect the Muslims in the country. The group is calling on inter-national peacekeeping forces to break the control of anti-balaka militias and station sufficient troops in towns where Muslims are threatened.

“Anti-balaka militias are carrying out violent attacks in an effort to ethnically cleanse Mus-lims in the Central African Republic,” said Joanne Mariner, senior crisis response adviser at Amnesty International.The most lethal attack documented by Am-nesty International took place on January 18 in Bossemptele, where at least 100 Muslims were killed. Among the dead were women and old men, including an imam in his mid-70s.To escape the anti-balaka’s deadly attacks, the Muslim populace has fled from numer-ous towns and villages, while the few who remain have taken refuge in and around

churches and mosques.“The urgency of the situation demands an im-mediate response,” said Mariner. “It is time for the peacekeeping operation in the Central Af-rican Republic to protect the civilian popula-tion, deploy to threatened areas, and stop this forced exodus.”According to Amnesty International, the current violence, hatred, and instability are a direct result of the human rights crisis that began in December 2012, when mostly Mus-lim Seleka forces launched an armed offensive that culminated in their seizure of power in March 2013. In power for nearly ten months,

the Seleka were responsible for massacres, extrajudicial executions, rape, torture, and looting, as well as massive burning and de-struction of Christian villages, says Amnesty International in its report.Meanwhile, the United Nations has an-nounced plans to airlift food into the coun-try from neighbouring Cameroon. Road transport is too dangerous without a military escort. But the food, mainly rice and cereal, which will be arriving in the coming weeks, will be enough to feed only 150,000 people. More than a million are in dire need of aid. B. S.

Muslims flee ‘ethnic cleansing’ in Central African Republic

By Theodoros Benakis

A new state was born on 9 July 2011. South Sudan was formed following a referendum in which 99% of the votes

cast were in favour of independence. This was expected to mark the final chapter in South Su-dan’s bloody story of 35 years of armed conflict and massacres

At the time, however, many political analysts doubted the successful future of the new state - the newest state in Africa - despite the fact that South Sudan has one of sub-Saharan Africa’s largest oil reserves. Following the civil war which exploded last year, the question now is whether the sceptics were right.

On the eve of gaining its independence, South Sudan was one of the most underdevel-oped regions in Africa. In addition, ethnic and religious divisions aggravated the situation.

Under President Salva Kir, South Sudan’s new leadership failed to govern. The ruling Su-dan People’s Liberation Movement (SPLM) became the new political leadership and did not manage to digest the new state’s multi-party sys-tem. As a result, the executive branch assumed the role of the state’s army.

Nevertheless, very little was achieved as re-gards the efforts to control the spread of arms which to this day remain in the hands of a large part of the population, including the ethnic and local leaders.

Another major issue is the country’s eco-nomic situation which remains critical. The rate of unemployment, especially among youth, is very high. According to the United Nations, 30% of population remain acutely food insecure.

The petrol-dollars the leadership received from the concession of large parts of land to for-eign companies have not resolved the poverty issue. Instead, it has fuelled large scale corrup-tion. President Kir and his entourage have been repeatedly accused of funnelling money ear-marked for the development of agriculture and infrastructure development to finance their own personal enrichment.

Even in the field of democracy, the situation remains grim. The ruling party has used dictato-rial methods to govern the country. Members of the opposition, as well as ethnic minority groups, have accused the ruling party of violent and oppressive tactics. Media that were critical

to the government face the brutality of the po-lice forces. One journalist, Isaial Abraham, who was known for his harsh criticism against the government, was killed in front of his home in the capital city of Juba.

South Sudan’s struggle for independence began in 1955 when the country gained its in-dependence from joint British-Egyptian rule. In 1972, the Addis Ababa Peace Agreement grant-ed a kind of autonomy to South Sudan. But in 1983, the Sudanese government revoked South Sudan’s autonomy. Led by the SPLA, civil war broke out again.

Adding more fuel to the fire, discord within the ranks of the rebel forces in 1991 exploded into a “civil war within the civil war” following a split by Riek Machar, the leader of the SPLA. Of the numerous massacres that were reported, the most gruesome was that in which 2,000 peo-ple in Bor were killed by Machar’s men. During the civil war, there was no limit to the methods employed, including the forced recruitment of ‘child soldiers’ as young as seven years old.

In 2002, rebel forces reunified. In 2005, the Comprehensive Peace Agreement with Sudan granted regional autonomy - a precursor to the 2011 referendum for independence. During the war of independence, as many as 1.5m people

were killed and another 4m others were forced to flee to neighbouring countries in search of refuge.

It was expected that the new state of South Sudan would avail itself of its oil wealth. After all, 75% of the oil reserves of the former unified Su-dan lie in the south. But this was not the case be-cause the refineries, including the pipelines, lie in the Red Sea in Sudan. The oil and all its wealth remain a cause of chronic dispute between Su-dan and South Sudan.

The ethnic factor is another reason for the ongoing crisis in South Sudan. The country is inhabited by many ethnic and linguistic groups, among them the Dinka, which is the largest, fol-lowed by the Nuer and the Shilluk. While the majority of the population follows traditional African beliefs, there is also a minority of Chris-tians. After South Sudan gained its independ-ence, two leading figures monopolised politics.

One is President Kir, 63. He is a veteran of the rebel movement of the late 1960s, a fervent Christian, a low-ranking officer and a Dinka by descent. President Kir assumed the leadership of the movement after the death of its charis-matic leader John Garang in 2005. Donning his trademark cowboy hat, Kir won the 2010 elec-tions even though his opponents accused him

of intimidation and intolerance to any kind of dissent.

The other is Machar, who was the first vice-president of the country. The 61-year-old is a de-scendent of the Nuer tribe. He studied engineer-ing in Sudan and obtained a PhD in philosophy and strategic planning at Bradford University, in the United Kingdom. His life has been riddled with controversies. In 1984, Machar was a leader of the SPLM, but in 1991 he split and founded his own armed forces, the SPLA-Nasir. At the time, he received backing from the Sudanese government and in 1997 became an assistant to the Sudanese dictator. In 2002, he rejoined the SPLA and since 2005 he has been serving as the vice-president in the south.

But what happened to trigger yet another civil war?

Last year, Machar announced he would run for president in the upcoming elections in 2015. President Kir did not like this. In response, Kir booted Machar out of office under the pretext that he was preparing a coup d’etat. This was in July 2013.

In retaliation, Machar reacted by forming his own armed forces and initiated a guerrilla war against the government.

In response, President Kir began to round up and jail main opposition leaders who he also accused of plotting against him. He threatened them with the death penalty. Despite the fact that most of them were eventually released from prison, Kir is determined to prevent them from participating in the peace talks.

But there are also other armed players in this game who are making the situation spiral out of control. One is the head of the South Sudan Lib-eration Army, Peter Gadet, who is a former gen-eral of the SPLA (the largest and most powerful guerrilla movement). The other is the armed group of George Athor (killed in 2011), who was the mastermind behind the 2011 massacre in which 200 civilians were killed.

The current civil war is just as bloody as the first one. Thousands of people have been killed and hundreds of thousands of others have fled their home to escape the fighting.

The peace talks are scheduled to start again and to focus on political dialogue and national reconciliation. But as long as the protagonists of the crisis remain seated at the table, any peace ac-cord will be fragile and unstable.

South Sudan, a lost cause?

A patient waits to be treated by Medecins Sans Frontieres (MSF) staff at a temporary clinic in a church of Malakal on February 5, 2014. AFP PHOTO/CArl de SOuzA

15ARTS & CULTURENEWEUROPEwww.neweurope.eu16 -22 February, 2014

By Alexandros Koronakis

Before performing at Brussels’ prestigious Cirque Royale, the King of the Greek music scene visited the New Europe stu-

dios to chat about Athens, Brussels and building a bridge after the imposition of austerity.

Life is tough in Athens, Remos says, adding that people have made great efforts and been patient, but tension remains high, “We all hope there will be no random incident to trigger an outbreak in the country.”

He is concerned, however, “There are many reactionary voices, there is high unemployment, much pressure, harsh measures and high taxa-tion. But for the time being I feel like we are get-ting by.”

So, where better for the singer to speak out! “Well, we are in the centre of Europe, here is where all decisions are taken, so people’s voices should be heard, at least here, in the centre for the decision making.”

How do you feel when you hear these words: European Union? “I have experienced the Euro-pean Union both from the perspective of a Eu-ropean country as Germany is, but also from the very first moments when the meaning of the EU was perceived as something that would save us,” he says. “Of course our country, within the EU, has traveled and continues to travel, it belongs and it is a member of the EU. But I certainly be-lieve maybe we mismanaged some opportuni-

ties that the EU gave us but we have also received a lot of help as well.”

Looking at Greece from the outside, the Golden Dawn are causing grave concern, what does it look like from inside Athens?

“It is sad that these extremes in Greece have gained so much power, and there’s not only Golden Dawn, there is also the extreme left, all

the extremes generally in Greece. Unfortunately these are the signs of times, when there is pres-sure and people feel it, they think the solution is

to resort to extremism.”We saw that this had a cultural impact as

well, since artists put an end to their cooperation due to political differences. Would you do some-thing like that?

“I never mix politics with my work, with singing. What I believe and what efforts I make for the country is my own personal matter. I al-ways try not to expose either my co-workers or businessmen.”

How about the audience? “The people that come to watch me sing, I think they want to trav-el and forget about their troubles and not to have me reminding them all the time of what happens in my country and especially during a time when they need relaxing and entertainment.”

Finally, Remos has an important message for Europe, “I hope that the heart of Greece will continue beating in Brussels and in the entire Europe and the entire world. It’s very important for people in Greece that they feel the heart beat-ing outside the country supports the Greek cul-ture and pride.”

He adds, “You give us strength to continue walking in this hard path.”

To see the full video interview with Antonis Re-mos (in Greek) go to: http://neweuro.pe/remoslive

ST. PETERSBURG - Russia’s cultural capital St. Petersburg Monday celebrated the 177th anniversary of the death of its greatest son, the poet and national cultural icon Alexander Pushkin.

Several hundred people laid flowers and joined in a minute’s silence at the house where Pushkin spent his last days, now converted into a museum.

The observance of a minute’s silence at the precise time of the poet’s death, 14:45 local time, is an unbroken tradition continued by locals even during the Nazi Siege of Leningrad from 1941 to 1944.

Meanwhile, in the Chyornaya Rechka dis-trict of the city, crowds gathered at the obelisk commemorating the famous duel in which Pushkin lost his life in 1837.

A series of poetry readings and other Pushkin-related cultural events have been or-ganized across the city to commemorate the anniversary.

Pushkin is widely regarded as the father of modern Russian language and literature, serv-ing as an inspiration to subsequent Russian authors including Leo Tolstoy, Fyodor Dos-toyevsky, Anton Chekhov, Vladimir Nabokov and poets of the so-called Silver Age in the late

19th and early 20th centuries. Pushkin’s most famous work, Eugene On-

egin, tells the story of a young man’s coming of age, and is widely regarded as Russia’s national poem.

Ballet and opera adaptations of the story are routinely performed in St. Petersburg theaters and on stages all over the world. A popular local adage informs the foreign visitor that “ Pushkin is our everything.” (Xinhua)

Antonis Remos sings a song for Europe

St. Petersburg celebrates memorial of Russian national poet Pushkin

And speaks exclusively to New Europe

Antonis Remos being interviewed in the New Europe Studios

A self portrait by the poet Pushkin

16 ARTS & CULTURE NEWEUROPEwww.neweurope.eu

16 -22 February, 2014

New big-budget film about Vikings to be shot in IcelandFew people know that the Vikings, apart from being brutal, were also well educated and savvy businessmen and merchants. This is one reason why Iceland’s most famous director and producer Baltasar Kormákur’s next movie will be a character-driven film showing the Vikings in a new light. Kormákur is planning to start filming as soon as he finishes making his current project Ev-erest, which is about the ill-fated 1996 expe-dition that left eight climbers dead. He has spent more than a decade writing the script for his Vikings movie, which he will film in Iceland. Though little is known about the film, Ko-rmákur has revealed to local media that the lead actor is Irish and most of the cast is Scandinavian and European. He has also se-cured financing to cover the budget (about

$100m) from an American partner who has yet to be named.

A new Golden Age of Dutch masters on display The Hermitage Museum in Amsterdam will soon offer visitors a unique opportunity to view 30 large paintings by the famous Dutch master Rembrandt van Rijn and his contem-poraries. It will be the first time ever that the paintings will be shown together. The exhibition is titled Gallery of the Golden Age. It will focus on Dutch citizenship dur-ing in the 17th and 18th centuries when Am-sterdam was at the height of its international powers. “We have many more paintings than we can display. This is a great opportunity to go big on these massive group portraits,’ said Amsterdam Museum director Paul Spies.The exhibition will open in November.

By Federico Grandesso

In an exclusive interview with New Eu-rope, Christos Doulkeridis explains why Brussels’ chocolate industry is one of the

sweetest ways to attract tourism. As Brussels’ minister for tourism, Doulkeridis recently in-augurated the city’s first ever Salon du Choc-olat and has just announced plans for a new Beer Museum.

New Europe: This is the capital’s first ever Salon du Chocolat. Why is it impor-tant?

Christos Doulkeridis: The chocolate industry in Brussels not only creates jobs, but can also promote tourism. Chocolate and beer are the two products that Belgium is widely recognised as world leader. In this context, it was essential to have a Salon du Chocolat in Brussels. After all, the Belgians are the second largest group of chocolate con-sumers in the world - per capita, per year - af-ter the Swiss. Another reason is that we have an important group of extraordinary crafts-men who are able the reinvent with new ideas

the chocolate panorama and to associate it with all kinds of other products. Chocolate is for us an important business card for our tourist attractions.

Can you tell us more about how you are planning to increase tourism to Brussels?

There is a project of a big contemporary art museum. We opened the Magritte Museum and in a few years we will also have a new Beer Museum - a Beer Temple. As regards choco-late, we have the museum and the Chocolate Pass, which offers people the possibility to meet the craftsmen in various areas of Brus-sels. The pass contains 10 coupons and costs only 6 euros. Another strategy we have pushed a lot is gastronomy, which is the promotional theme we chose in 2012. And I can say that in Brussels, the quality level of the food is high at a relatively good price.

What is the strategy to promote the chocolate industry?

We have to reinforce and consolidate the international role of the Salon du Chocolat in Brussels because, unfortunately, we face in-

creased competition from other countries like France, Japan and the United States with New York. In this competition, we need the big his-torical houses like Leonidas, Godiva and Neu-haus and the old craftsmen like Marcolini. We have to work together to promote this sector as a “national pride”.

We just saw here a fantastic chocolate fashion show. How do you see this combi-nation?

It’s important to combine the two because when we see the work of chocolate masters like Marcolini, for example, it’s almost a work of “haute couture”. So it was clear to combine the two forms of haute couture. Also, Brussels was not recognised as a fashion capital, but now it’s entering among key cities in the sector at an international level

Is the number of international visitors growing in Brussels?

First, for us, the Intra-Belgian tourists are fundamental. After this, we have the neigh-bouring countries like France, the Nether-lands and Germany. Among the most success-ful countries in terms of growth, China is a leader, followed by the BRICS, Japan and the Gulf countries. For the Chinese tourists, for example, Brussels is becoming a key destina-tion to visit during one’s lifetime. Finally, Brus-sels is more and more a preferred destination in Europe for a city trip. Brussels, as the capital of Europe and for its symbolic role, can be at-tractive especially for the young tourist. This is why in our strategy - in our triennial plan - we have put forward gastronomy. In the future, we would also like to promote the creativity in a transversal way.

ADVERTISEMENT

An exclusive (and sweet) interview with Christos Doulkeridis, Brussels’ minister for tourismThe capital’s first ever Salon du Chocolat

Christos Doulkeridis on the sweet side of Brussels. |BELGA PHOTO JASPER JACOBS

17fashion & styleNEWEUROPEwww.neweurope.eu16 -22 february, 2014

This season, the subtle and delicious Asian aroma we’re accustomed to seeing in In-

donesian designer Prabal Gurung’s work, took the form of loosely draped skirts, oversized pullovers and capes in serene saffron and Ti-betan red, pashmina paisley motifs, tribal handmade fabric-inspired designs and luxurious embroidery. The modernity in Gurung’s col-lection lies in the combination of traditional influences with cutting edge tailoring, like sexy cutouts that compliment the bust and side slits that elongate the legs, as well as in the harmonious patchwork of mate-rials: leather, fur, chiffon, brocade, satin and wool.

Although best known for its co-

lourful swimwear, Australian brand Zimmermann has also been pre-senting successful ready-to-wear and resort lines in Sydney for sev-eral years, before showing at New York Fashion week for the first time last June. This season, head design-er Nicky Zimmermann presented a beautifully romantic-rock collec-tion – a refreshing combination of both sweetness and edge. Combed back boyish hairstyles, plum lip-stick, black socks with shiny loafers, studs and faux bomber jacket prints conveyed a definite biker attitude, while cute bow chokers, sweet-heart bust lines and elegant floral, retro lingerie-inspired lace prints gave the collection a feminine aura along with a certain nostalgia

for long gone days. The coherence and styling finesse of the collection surely make Zimmermann a brand to watch.

As for Kate and Laura Mul-leavy, their Rodarte collection had its usual touch of New England romanticism with sparkly evening wear in powdery tones and suffrag-ette outfits with mini gloves, over-sized coats, fluffy collars, knitwear, and woolen sweaters in earthly co-lours. The last part of the collection took a sari twist, with long evening gowns that paid tribute to pop cul-ture through Sci-Fi inspired themes like Star Wars and Lord of the Rings prints.

Zac Posen’s famously spectacu-lar evening gowns had a Sci-Fi twist this season as the designer played with volume and matched ample Victorian-shaped skirts to pointed cone-like geometrical busts in a gor-geous palette of apple, teal, bronze, watermelon and slate blue.

Joseph Altuzarra’s collection was particularly noticeable for its luxurious minimal wraparound double-faced cashmere coats and suits with belts and large lapels or shawl collars. There was a distinctive modern art style in Altuzarra’s way of reviving total black, grey, bottle green or navy blue coloured looks with surprising touches of shocking pink, orange and Klein blue.

Upcoming and very promising designer Jonathan Simkhai intrigu-ingly mixed sportswear elements like geometrical baseball jackets, tan leather lining, diving tops and front zips, with 40s stripped grey flannel trousers and dresses, while another

part of the collection featured lac-quered turtleneck tops and mini-skirts for a trendy ‘crocodile effect’.

Hats off to Anna Sui for pre-senting an extremely refined and wonderfully styled collection this season – certainly one her best to date. As usual, all Chinoiseries and Art Deco inspired, Sui combined silk pajamas and tunics with retro prints in bold colours, fur coats and tassel necklaces for 20’s ‘Chinatown’ femme fatales.

Last but not least, for his very conceptual collection, Alexan-der Wang presented a bleak vi-sion of urban life. The models were groomed to look like window shop dummies, or rather like robots, as their ‘wax face’ and boyish hairstyle would suggest. Flat chested, unisex silhouettes with strict shirt collars, geometrical silver sweaters and utility pockets for gadgets and por-table devices added to the futuristic mood, while hunting boots and heat sensitive outfits that changed colour

added to the idea of uniformity, camouflage and external threat.

Louise Kissa lkissa@neurope.eu

NEW YORK FASHION WEEK: FALL 2014

Yesterday, Today and Tomorrow

RODARTE© Slaven Vlasic/AFP

ALTUZARRA© Don Emmert/AFP

JONATHAN SIMKHAI© Ilya S. Savenok/AFP

ANNA SUI© Frazer Harrison/AFP

RABAL GURUNG© Don Emmert/AFP

ZIMMERMANN© Jemal Countess/AFP

ALEXANDER WANG© Stan Honda/AFP

ZAC POSEN© Frazer Harrison/AFP

18 BRUSSELS AGENDA NEWEUROPEwww.neweurope.eu16 -22 February, 2014

20-24 Feb. 2014 - International Pavillion

The theme of this year’s book far, “history with a large ax,” will focus on the Great War. The fair’s many events-- including meetings, exhibi-tions and dedications-- will bring together writ-ers and historians to explore the connection between history and intimacy.

The fair will feature programs for all ages, with events on children’s literature and “family reading.” Other meetings and debates will look at themes of war and peace, as well as literature in the UK. A number of authors and publish-ers will also be present, including AC Grayling, Anne Fine and Gilles Bachelet.

For a more interactive experience, you can check out the Imaginarium. Shows will feature the world of comics, with multimedia per-formances on everything from the Smurfs to graphic novels.

Tickets are available in advance for 8 € through ticketnet.be. Tickets are 8 € on week-

days, 9 € on weekends and 5 € for students, sen-iors and groups. Admission is free for children under six.

25 June -- Forest National, 20:00

Tickets are now on sale for ZZ Top’s June performance at Forest National. The band, known as much for their lengthy beards as their music, will perform classics such as “La Grange,” “Gimme All Your Lovin’” and “Sharp Dressed Man.”

The tour follows the band’s 2012 release of “La Futura.” The album received warm re-views, especially for its adaptation of a hip-hop classic with “Gotsta Get Paid.”

22 Feb.--19:00 to 1:00--Brussels

About 20 museums will participate in the sev-enth Brussels Museum Night. The event, involv-ing museums from all over the city, includes spe-cial exhibitions, live performances, live music, museum tours and more.

One of the participating museums is the Museum of the City of Brussels, which will be hosting the exhibition “From bread hall to Mu-

seum of the City.” This exhibition highlights the medieval history of the buildings that came before the bread hall and what purposes those buildings served. The exhibition includes en-gravings, drawings, paintings, blueprints, sculp-tures, photographs, graphic digital reconstruc-tions and more. The event will take place on Saturday, 22 Feb. from 19:00 until 1:00. Free shuttles will be available to take participants be-tween the museums.

Museum Night Fever 2014Foire du Livre de Bruxelles

ZZ Top

John Newman

Cite du DragonChaussee de Waterloo, UccleTel 02 375 8080www.citedudragon.be

You may have passed this restau-rant and wondered if the cuisine matches its incredible facade.The answer is a resounding Yes!The decor, both outside and the cav-ernous inside, is quite astounding, all water features, oriental antiques and painted murals. But, of course, the food is the most important thing and, here, you most certainly won´t be disappointed.Apart from a very long a la carte, there are various menus, including the “Lacquered Duck”, featuring appetiser, starter and the main dish - a whole, melt-in-the-mouth Peking duck,served in pancakes in its crispy, caramelised skin, with vegetables and, finally, in a delicious soup.For starters, the “Dim Sum basket” is recommended and even the sticky Thai rice is wonder-ful. There are also plenty of options for veggies and an “all-you-can-eat” €27 pp (drinks excl.) buffet on Friday and Saturday evenings, plus Sunday lunch.Considering the splendour of the food and surroundings, it`s all very affordable. The Vietnamese-born owner Luc Tu Liem, who also has a restaurant of the same name in Liege, presides over a 20-strong highly efficient team. After a sumptuous meal, you can take a stroll in the amazing Asian-style garden.This is a Brussels dining institution and it´s easy to see why.

Resto Bites26 Feb. - Ancienne Belgique, 20:00

Newcomer John Newman will bring his striking vocals to Ancienne Belgique in late February. The Telegraph’s James Lachno compared New-man to „Otis Redding...after gargling glass,” and described his vintage sound as a cross between ‚50s rock-and-roll and ‚60s Motown. After releas-ing his debut album in October, Newman has been nominated for two Brits Awards: Best Brit-ish Single and Best British Male Solo Artist. Both categories feature a slew of popular artist, includ-ing Passenger, One Direction, Ellie Goulding and even David Bowie.

Newman, who writes and produces his own songs, said in a January interview with The Guardian that he’s not interested in fame. He de-

cried the music industry’s abundance of celebri-ties rather than artists, especially in the UK.

Upcoming EvEnts

Singer John Newman performs at The CW Showcase at Pinnacle II Lobby Cafe on January 14, 2014 in Burbank, California. ANGELA WEISS/GEttY IMAGES FOR CW/AFP

Attendees check out books at the 2013 Foire du Livre in Brussels. BELGA PHOTO BRUNO FAHY

This undated file picture shows people visiting the Museum of the City of Brussels at the Grand Place. BELGA PHOTO ARCHIVES

19SocietyNEWEUROPEwww.neweurope.eu16 -22 February, 2014

By Denise Wall, Xinhua

HELSINKI, On a frigid morning in the depths of Finnish winter a gaggle of more than 250 experts, high-ranking decision makers and retirees gathered to ponder the challenges and opportunities presented by the country’s aging population.

Experts at the meeting have stressed that Finland’s elder power in starting up new busi-nesses and volunteering their services should be unleashed.

“We have the second-fastest aging popula-tion after Japan,” said Antti Kivela, head of the Empowering Society unit of the Finnish Inno-vation Fund Sitra, the body that organized the talk shop.

It’s hard to believe that small, vibrant and technologically-forward Finland is grappling with the challenges of a rapidly aging popula-tion. But the numbers don’t lie.

According to the Finnish Centre for Pen-sions, more than 73,000 people retired from working life on an earnings-related pension in 2013. For the first time ever, the number of retirees cashing in on their old age pensions in a single year exceeded 50,000, the Centre reported.

“The target group we’re speaking of is about one million, but it’s increasing because the population is aging. So in about 20 years’ time it will increase by about 500,000,” Kivela explained.

Sitra’s Empowering Society offensive aims to target this aging cohort and exploit their potential for community-building work while ensuring meaningful lives in the 20-plus years they have remaining.

Finland’s well-educated seniors have very promising post-retirement prospects.

Because of the skill, work experience and connections accumulated over an average 25 - 34 years of working life, many of them - about 50,000 - continue in full time employment af-ter retirement.

Another 100,000 work on a temporary ba-sis and the numbers are growing, Kivela noted.

Apart from paid employment, Sitra sees seniors stepping up to provide voluntary ser-vices to complement municipal offerings in areas such as child care. Since many retirees are technology-savvy, the medium to match elderly service providers with municipalities or even individuals could be the internet, Kivela said.

“There are people who are lonely and who

want to help someone and there may be peo-ple nearby who need the help, but they may be too isolated from each other. So we think that new technology should be used in a voluntary work dating system,” the Sitra director said.

According to Kivela, Sitra’s role is to identi-fy gaps in the market and try to fill them, typi-cally by trialing new ideas. The “work dating” concept is just such an example. The idea will move into pilot stage during the summer in cooperation with selected municipalities, with a view to having the first set of results by the end of 2014.

More traditional forms of entrepreneur-ship are further options for Finland’s experi-enced elders, Kivela noted.

“We speak a lot about start-ups. Every-body thinks it’s youngster business. We think it should be elderly business,” Kivela declared, noting that seniors have already raised fami-lies, paid off home loans and face less risk than young adults looking to break into business.

If Sitra and Finland’s corps of skilled and vigorous retirees have their way, the next five to ten years will see more seniors starting new businesses, volunteering their services and leading meaningful lives as active members of society.

LOS ANGELES (AP) — TV viewers increas-ingly are watching programs on their own schedule, according to a Nielsen company me-dia study released a few days ago.In the past year, time-shifting of television content grew by almost two hours, averag-ing 13 hours per month, the study found. Viewers averaged nearly 134 hours of live TV viewing a month in 2013, down nearly three hours from 2012.Television still remains central to media con-sumption, the study found, despite the increase in time-shifted viewing and streaming video

through a computer or smartphone.On average, American consumers own four digital devices, the report found. The major-ity of U.S. households own high-definition TV sets, Internet-connected computers and smart-phones, while nearly half also own digital video recorders and gaming consoles.The average consumer spends about 60 hours a week viewing content across various plat-forms, Nielsen found. Multitasking is com-mon; 84% of smartphone and tablet owners say they use their devices as second screens while watching TV.

“It’s an incredibly exciting evolution in the ways people are using devices to get media,” said Megan Clarken, Nielsen executive vice president.While sports events generated the most Twitter postings last year, more than 400 million, TV se-ries also had impressive numbers. The top three: “Breaking Bad” with 6 million tweets, “The Walking Dead” with 4.9 million and “American Horror Story: Coven” with 2.9 million.An offbeat survey finding: 40% of adults be-tween the ages of 18 and 24 use social media in the bathroom.

Unleashing Finland’s elder power in business, volunteering

Tumblr founder David Karp and Yahoo CEO Marissa Mayer | MARIO TAMA/GETTY IMAGES/AFP

Thousands of Israeli Sephardi Jews consider

Spanish citizenshipBy Susana Mendoza, Xinhua

JERUSALEM - Thousands of Israelis have in-quired authorities about information on how to acquire a Spanish passport since Madrid an-nounced its decision to grant dual citizenship to Jews of Sephardic descent. The Spanish government announced Friday a new amendment to the legislation that allows Sephardi Jews (descendents of Jews that fled the Iberian peninsula 500 years ago) to obtain Spanish citizenship if they can prove a link to Spain. With the amendment, applicants will not be forced to give up their current citizenship, but will be able to keep both. This move has prompted many Israelis to seek a Spanish passport, some out of an emotional connection to Spain and others out of a motive to become an European citizen. The announcement caused outrage among Se-phardi Jews in Israel. “I’m going to apply because I checked the list of the names that they consider as having Se-phardic origins, and it turns out mine is on the list,” A.S., an Israeli whose roots are related to Iran and Iraq, told Xinhua. “I’ve been to Spain on a few times because I have a good friend there, but I don’t hold any kind of emotional link to the country, I just want to have the option to take if I want to leave,” he said. “I think many Israelis will leave if they get the passport because they are tired of the hard-ships here, despite the economic crisis in Spain,” he added. Many Israelis reacted to the news wondering why the Spanish government is so keen to bring Jewish people back to the country. “I think it’s a political manoeuvre, probably it’s a simplistic way to think that by bringing Jews back to Spain, the economy is going to recover somehow,” Michael Telias, an Israeli of Sephardic origin, told Xinhua. “I’m pretty sure this decision doesn’t have anything to do with making any kind of compensation for kicking the Jews out 500 years ago,” he said. “I don’t care how fast or how easily they give out passports from now on, I am not moving to Spain, that’s for sure,” he said, “at least not until there is a public apology for what the Spaniards did to us back then.” Many Sephardi Jews have maintained for gen-erations the language known as Ladino, which is a mix of archaic Spanish and Hebrew, as well as a longing for the land of Spain, Sefarad in Ladino. The Jews who lived and thrived in Spain for centuries were forced to either convert to Ca-tholicism or to leave the country, as well as the Muslim population. Most of the Jews fled to other surrounding countries like Morocco, Turkey, Greece, with some reaching as far as Syria or Iraq.

Study: Media everywhere, bathroom included

Investing in the elderly will bear fruit say Finns. EPA PHOTO LEHTIKUVA-MARTTI KAINULAINEN-SR

20 TECHNOLOGY NEWEUROPEwww.neweurope.eu16 -22 February, 2014

When Electronic Arts, the world’s leading interactive entertainment company based in California, released the strategy video game Dungeon Keeper in 1997, it was an instant cult hit. Today, its new free-to-play Dungeon Keeper reboot for Apple and Android devic-es is an instant flop.

Gamers all over the internet are criticis-ing EA for its “unfair” in-app payment sys-tem that makes Dungeon Keeper “unplay-able”.

As in the original Dungeon Keeper, the player must construct and operate an under-ground lair to attract monsters that are then used to defend the place against attackers. Imps (this is what the game calls the min-ions) are needed to dig out rooms and cor-ridors in order to create the dungeon.

One of biggest criticisms is that the imps work excruciatingly slow - it can take them a

full day to dig out some types of territory - unless the player makes an in-app purchase.

In an interview with the BBC, Peter Molyneux, the designer of the original 1997 Dungeon Keeper game, admitted that he too was shocked. “I felt myself turning round saying, ‘What? This is ridiculous. I just want to make a dungeon. I don’t want to sched-ule it on my alarm clock for six days to come back for a block to be chipped,’” he said.

“I don’t think they got it quite right, the balance between keeping it familiar to the fans that were out there but fresh enough and understandable enough for this much bigger mobile audience,” Molyneux added.

EA, however, disagrees. In a statement issued by the company, EA insists it has de-signed an experience wherein players don’t have to spend money if they don’t want to.

In an interview on Tab Times, Jeff

Skalski, the game’s senior producer, was quick to respond to the criticism.

“It’s important to emphasise that we de-signed a game that is built around the typical mobile play patterns,” he said.

“This means Dungeon Keeper is meant to be played on the go multiple times a day with a few minutes here or there. This way of playing allows fans to naturally progress as a free player...

That’s not to say you can’t quickly blow past 30 minutes in one sitting by summon-ing new minions, reorganizing your dun-geon layout, find a keeper to attack, check in with your guild, queue up your next digs then take on a new event raid before calling it a night. To that end, yes, we’ve designed the game to offer players the option to spend money if they’d like to speed up their game-play.”

New Dungeon Keeper game digs up in-app criticism

Sometime in the future, people might start trading in their keys and credit cards for microchip implants. According to a re-

cent article by the BBC, at least one Londoner wants his sooner rather than later.

Frank Swain is the impatient cyborg. A few years ago, he tried to remove the microchip from his Oyster card (London’s public trans-port pass) in hopes of transplanting it into his hand. The only problem was that he couldn’t find the high-grade silicone needed to coat the chip to prevent his body reacting against it.

Across the Atlantic in Seattle, Washing-ton, however, Amal Graafstra has implanted two microchips - one in each hand. The self-described “adventure technologist”, has a re-writable chip in his right hand. As crazy as this all might sound, Graafstra can download infor-mation from his body or upload to it just by pressing his hand to his smartphone. The chip in his left hand is a simple identity number that can be scanned. Graafstra uses it to unlock his

front door, start his motorbike or access his computer.

Earlier this month, Graafstra even set up a one-of-a-kind “implantation station” at San Francisco’s sold-out Transhuman Visions conference. For $50, he offered to use a large needle (like the one used to microchip pets) to inject a glass coated RFID tag (the size of a rice grain) into each volunteer. He found 15 willing volunteers.

“Every Hollywood movie has told them that implants are for tracking people,” Graaf-sta told the BBC. “People don’t get that it’s the same exact technology as the card in your wal-let. When someone uses a credit card, wireless or not, they are tracked because several other corporations know who they are, when they purchased, how much they spent, and where they spent it.

“Basically you’ve taken an RFID access card normally stored in a pocket and moved it to a skin pocket,” he added.

STOCKHOLM - Bitcoin had become a common medium of exchange in illegal drug deals in Sweden, local media reported Sunday. Bitcoin was used by drug dealers in at least six transactions in Sweden in 2013, and in several cases the offenders completed the deals on internet, said the Swedish Daily News(DN). Four people were convicted of drug smug-gling in the northern city Haparanda of Sweden in December, when a large amount of Bitcoin was found in the computer of the main suspect, involving around a hundred

transactions. The suspect has handled “half a million Swedish kronor (about 77,000 U.S. dol-lars),” Lindha Stromberg, a local prosecutor, was quoted as saying by DN, while adding that the increase in the value of Bitcoin was difficult to say as its price had risen sharply. It was difficult for the police to obtain the password to the virtual wallet for Bitcoin storage, and users’ identities were also hard to trace on websites which served as plat-form for those illegal trades such as deals of drug, weapon and other services. Furthermore, Bitcoin used cryptography to

control the transactions between the users and therefore the process was independent from banks or financial institutions. However, Mats Henricson, president of Bit-coin Association, did not consider Bitcoin as a competitive alternative against cash or drug deals. “Of course you can pay anonymously, but you still have to receive post packages...They do not just disappear because you pay in Bit-coin,” said Henricson. Bitcoin is an electronic cash system first described by pseudonymous developer Sa-toshi Nakamoto in 2008. (Xinhua)

Cyber attacks in Bulgaria, Slovenia and Tokyo halted or delayed the exchange of Bitcoins - a vir-tual currency.Slovenia’s Bitstamp, one of the largest Bitcoin exchanges in the world, was forced to impose a freeze on all withdrawals of this virtual currency after coming under cyber-attack. A similar as-sault against Tokyo’s MtGox forced the Bitcoin exchange to suspend withdrawals, while Bulgar-ia’s BTC-e warned that some of its transactions would be delayed.The Bitcoin Foundation, which developed the cryptographic code on which the currency relies, is now creating workarounds and fixes to combat future cyber attacks. The foundation has assured that all Bitcoin savings are safe even if they are temporarily “tied up”.“This is a denial-of-service attack; whoever is do-ing this is not stealing coins, but is succeeding in preventing some transactions from confirming,” Gavin Andresen, chief scientist at the founda-tion, explained in a statement published on the Bitcoin Foundations website.According to the Bitcoin Foundation, its mem-bers and developers from a number of exchanges are working “collectively and collaboratively” to tackle the problem and allow withdrawals to resume. For a Bitcoin transaction to be pro-cessed - this is called “mining” - the computer is programmed to solve a maths problem with a 64-digit solution. One block of bitcoins is pro-cessed for each problem that is solved. In return, the “miner” is rewarded with new bitcoins. To receive a bitcoin, however, a user must have a Bitcoin address - a series of up to 34 letters and numbers. This is a virtual post box where the bitcoins are delivered. The address is completely anonymous. One bitcoin is currently trading for about $665, below the $830 level before news of the cyber attacks.

The making of futuristic cyborgs, today

Tumblr founder David Karp and Yahoo CEO Marissa Mayer | MARIO TAMA/GETTY IMAGES/AFP

Bitcoin used in illegal drug deals in Sweden I’m gonna make you a man ESChIPul

Bitcoin exchanges suspended after

cyber-attack

21EUROPEAN UNIONNEWEUROPEwww.neweurope.eu16 -22 February, 2014

Germany|euro-exit

Lawmaker courts Germany’s euro-exitMost Europeans haven’t even heard of Peter Gauweiler, a member of Germany’s parliament and a lawyer by profes-sion, but they will soon. Gauweiler convinced Germany’s Constitutional Court in Karlsruhe that the European Cen-tral Bank’s programme to save the euro currency is illegal. The case is now before the European Court of Justice in Luxembourg. “Karlsruhe has shown ECB President Mario Draghi what a bazooka really is,” Gauweiler told reporters as he celebrated news of the court’s ruling. But not everyone in Germany or the rest of Europe is celebrating with Gauweiler. According to a report in Der Spiegel, Germany’s top-selling newsmagazine, there is growing concern that Germany’s constitutional court is flexing its muscle to forbid the Ger-man government from contributing to efforts to save the euro or even force Germany to leave the Eurozone entirely. Others are not as pessimistic. Some welcomed the decision to “push” the case to Luxembourg because they believe the European Court of Justice will not rule to cancel the bond-buy programme (officially called “Outright Monetary Trans-actions” or OMT). As regards the German court’s ruling, it said the ECB’s plan to proceed with unlimited sovereign bond purchases from debt-stricken Eurozone member states is in violation with European law because the OMT “exceeds the mandate” of the ECB. The German court also ruled that the ECB is encroaching on the responsibility of the mem-ber states for economic policy. “The constitutional court is apparently unable to deal with the complexities of the is-sue and is now seeking to push responsibility onto the Eu-ropean Court of Justice,” Michael Hüther from the Cologne Institute for Economic Research, told Der Spiegel. Another question that has yet to be answered, however, is how the German court will react if the court in Luxembourg throws out the case. Will the German court be satisfied? Whatever happens, Hans-Werner Sinn, the euro-sceptic head of the Munich-based Ifo Institute, told Der Spiegel that the Ger-man ruling has sent a powerful message to the ECB. He said it “will strengthen the position of euro critics and the general scepticism Germans have of the ECB”. But Michael Meister, parliamentary state-secretary in Germany’s finance ministry, sounded an alarm. “Stability can only be established where there is trust,” he said. “And you can’t establish trust where there are open legal questions in the Eurozone.”

FinLand|reFuGies

Finland mulls new asylum rulesAsylum seekers in Finland who have had their applications re-jected may be forced to leave the country under new rules that could deny them the right to settle for temporary residency. Officials in Finland report that there are currently 222 failed asylum seekers living in the country legally. They have been issued a two-year residence permit that they can renew in-definitely. Finland has also been offering to pay for failed asylum seekers voluntary return to their homeland, but this programme has not been popular. According to Interior Min-ister Paivi Rasanen, changes need to be made to the country’s asylum and immigration law. She wants to tighten the rules so that failed asylum seekers are no longer eligible for a tempo-rary two-year residence permit, which can later be made per-manent. The question now is what to do with failed asylum seekers. Even though countries like Afghanistan, Somalia and Iraq are now considered “safe”, it is very difficult to deport peo-ple to these countries. In fact, some 800 people are currently in Finland awaiting deportation. One way to reverse this trend, according to Rasanen, is to discourage asylum seekers from coming to Finland in the first place.

German policymakers are in the throes of debate over the new coalition govern-ment’s plans to introduce dual citizenship for the children born to immigrants in Germany.

Chancellor Angela Merkel’s Christian Democrats (CDU) and the Social Demo-crats (SPD) reached agreement on dual citizenship. But, according to Germany’s top-selling newsmagazine Der Spiegel, the two parties have different ideas about what a new dual citizenship should look like.

In talks prior to establishing the coali-tion government, Merkel’s conservatives and the socialists agreed to scrap the cur-rent requirement of forcing the German-born children of immigrants to decide by

their 23rd birthday about which citizen-ship they would like. However, Der Spiegel reports that the conservatives are seeking to place new hurdles in the way of dual citizenship.

The interior ministry, which is led by Thomas de Maizière, a member of Mer-kel’s CDU, has finished drafting a law that would require the children of immigrants to prove they have lived in Germany for at least 12 years in order to become eligible for citizenship.

This is much stricter than the agree-ment reached during the coalition agree-ment, which merely said that dual citizen-ship would be extended to those who were “born and raised” in Germany.

In an interview with Der Spiegel, Ali Dogan, deputy director of the SPD work-ing group Migration and Diversity, said: “The deal in the coalition agreement al-ready represents a minimal consensus. We can’t afford to accept further limitations”.

The SPD caucus in parliament issued the following statement: “We do not want to erect hurdles that are not feasible or are too bureaucratic”.

But Merkel’s conservatives are not backing down from their plans to intro-duce a residency requirement. “People who receive German citizenship must be a part of our society,” said Volker Kauder, the conservative floor leader in parliament.

German government to decide who is a German

FinLand |Corruption

Germany |Citizenship

By elina xu, xinhua HELSINKI - Finland, a Nordic country that has been a model in the world in com-bating corruption, has witnessed an in-crease of suspected business related crimes in the past few years.

According to a fresh police report quoted by the Finnish Broadcasting Com-pany Yle, alleged economic crimes have more than doubled over the past six years, from 91 cases in 2009 to 204 in 2013.

The increase was almost entirely due to a rise in cases involving the abuse of au-thority, which number has doubled since 2012.

Erkki Laukkanen, chief of Transparen-cy International Finland, said the public-private partnerships are “far from transpar-ency, and much more open to corruption.”

“I think the reasons are the same in many developed countries. The new rules of the world economy have affected pub-lic procurement too,” he told Xinhua on Tuesday. A report on corruption pub-lished by the European Commission last week also urged Finland to make more effort to tackle corruption, particularly in public procurement decisions and elec-tion funding. The European Commis-sion pointed out that old-boy networks are spreading in the country, distorting the public procurement procedures. It also said that the Finnish laws on the openness of public activities failed to keep pace with the trend of local governments to transfer part of their services to private sectors, resulting in difficulties in monitoring pub-lic procurements. Laukkanen said public procurements are often decided by private companies that have no obligation to re-veal details publicly.

The above accusations were made in the context of the overall stagnant eco-

nomic situation, which has haunted Fin-land in recent years and could be blamed for the chances of corruption.

Due to the continuous recession, the debt burden has been increasing and the Finnish government has to slash public spending and reduce staff size. As a result, more and more public services have to be outsourced to private sectors, causing the rise of corruption risks.

Moreover, Juuso Oilinki, an inspector specialized in corruption in Finnish police, said Finns have been naive when it comes to corruption. Long-established ways of operating are not perceived as illegal, and even officials often fail to recognize cor-ruption, he elaborated. Despite of the rise of corruptive cases in recent years, Finland still remains one of the front-runners in the anti-corruption movements both in Europe and around the world, with its good social climate, well established anti-corruption system and transparent super-visory mechanisms. Compared to those

nations with conspicuous problems of corruption, the circumstance in Finland is much better. Laukkanen admitted, “our ability to distinguish corruptive behavior is now much more better than it was - say - 10 years ago,” he said, adding that there is very little so-called street-level corruption in Finland, which encompasses things like bribing officials. To prevent business re-lated corruption, Jouni Hirvonen, Detec-tive Chief Inspector of National Bureau of Investigation of Finland, suggested, “com-petitive bidding processes should be more sharply scrutinized and closer attention paid to transparency.”

In addition, some Finnish police offic-ers have called for tougher punishments on economic criminal cases.

Finland has been ranked the first place in Transparency International’s Corrup-tion Perceptions Index for eight times, al-though slipping from the top to the third place in the annual corruption ranking published in the end of 2013.

Finland’s record of transparency blemished by increasing corruption cases

President of the European Council Herman Van Rompuy (L) meeting Finnish Finance Minister Jutta Urpilainen. EPA/MAURI RATILAINEN

22 EUROPEAN UNION NEWEUROPEwww.neweurope.eu16 -22 February, 2014

Denmark|TransgenDers

amnesty Int. blasts Denmark for discriminating against transgendersIf Danish transgenders want their new gender recognised by the state, they must first undergo procedures like castration or sterilisations. The local branch of Amnesty International has warned that this requirement is in stark violation of human rights. A large number of transgenders simply want to under-go hormonal treatment in order to change their appearance. According to Amnesty International Denmark campaign lead-er, Helle Jacobsen, Denmark is giving transgendered people an “impossible” choice to make. She said castration and steri-lisation are unnecessary operations. The government is now under mounting pressure to change the law so that transgen-ders will be able to obtain a new ID or passport that state their gender without having first to be castrated or sterilised. Am-nesty International also wants the government to unclassify transgender as a psychological illness.

sweDen|Defence

sweden’s new military system challenged by high dropout rateSTOCKHOLM - Seven of ten soldiers in Sweden’s voluntary military drop out before their contracts expire, which was be-low the worst predictions calculated since the new military system was introduced in 2010, local media reported Monday. Among 3,784 people started basic training with the Swedish Armed Forces in 2013, only six of ten chose to continue their careers in the military, said the Swedish online daily the Local. “The developments are alarming,” Peter Nordlund, economist at the Swedish Defence Research Agency (FOI) was quoted as saying by the Local. However, according to the forecast there should be eight of ten soldiers that would stay in the military as employees. To count in the 14% trained soldiers that dropped out before their contracts were up, there were only 23% sol-diers would complete their six-year contracts. A former sol-dier that was interviewed revealed that salary was the reason that he quit, according to the Swedish daily Svenska Dagbladet (SvD). “It is about the activities and about that people have faith in their future,” Karin Enstrom, Swedish Defence Min-ister, was quoted as saying by SvD, while adding that if people could feel it was meaningful, they would be convinced to stay. “Back in 2010, we began thinking about a plan B if the new sys-tem didn’t develop according to plan. It may be time for plan B now,” Nordlund said. In order to fill in the gap left by the drop-outs, 7% of a given age group would have to volunteer to join the military, which was a higher recruiting figure even than the United States. In 2010 Sweden abolished its compulsory military service which had existed since 1901.The new system allows conscripts to choose whether to continue or not, which is extended to both men and women, aiming to increase the flexibility and mobility of the country’s defense. (Xinhua)

Danmark | sOcIaL

number of ‘poor’ Danes on the riseNew research shows that the number of people in Denmark struggling to make ends meet and who cannot afford to put food on the table has doubled since 2002. According to the Danish think-tank Kraka, there were 23,400 “poor” in the coun-try in 2002. In 2011, Kraka said the number reached 46,600. Another important finding from the research is that almost 20% of “poor” people reside in public housing and that three-quarters of them are from non-Western countries. Officials define “poor” as falling under the annual income of 103,200 kroner (€11,600) before tax for three consecutive years.

By Danica kirka, associated Press

LONDON — Scotland has been warned.

If it votes to leave the United King-dom later this year, then the new country walks away from the pound.

That’s the hard-line and potentially game-changing message presented Thursday by U.K. Treasury chief George Osborne, who ruled out a currency un-ion in a speech in the Scottish capital of Edinburgh.

“The pound isn’t an asset to be di-vided up between the two countries af-ter breakup as if it were a CD collection,” Osborne said. “If Scotland walks away from the U.K., it walks away from the U.K. pound.”

Underscoring the importance of the day, senior leaders for all three major parties took to the airwaves and backed Osborne’s remarks — an unusual show of unity on any issue other than national security. The pound — also known as sterling — is one of the world’s most-en-during currencies and is one of the main battle-lines in the run-up to September’s referendum.

Though the comments may raise

the hackles of many and contrasts with the “love-bombing” approach of Prime Minister David Cameron in his appeal for unity last week, Osborne is gambling that the majority of Scots will move be-yond the romantic appeal of independ-ence and focus on more tangible bread-and-butter economic issues.

It also signaled that U.K. leaders were willing to stand and fight for the union on its strengths, and not just on emotion. Pro-independence leader Alex Salmond reacted angrily to Osborne’s speech, describing the attack on his planned currency union as an effort to bully and intimidate Scottish voters. Being part of a sterling zone has been the centerpiece of the Scottish National Party’s strategy to guarantee a secure, stable transition.

“Their efforts to claim ownership of sterling will backfire spectacularly in terms of reaction from the people of Scotland who know that the pound is as much theirs as it is George Osborne’s,” he said. Osborne noted the recent ex-perience of the euro to back up his view that a currency union cannot work if there isn’t a high degree of political un-ion. Why, he asked, should the remain-ing U.K. members — England, Wales

and Northern Ireland — shoulder the risk of a currency union should Scotland vote to break away?

Osborne’s remarks signal an intensi-fication of the independence debate. By ruling out the pound, Osborne is hoping that Scotland’s population of around 5 million will ask a series of questions that will tilt the debate against independence and seasoned economists continue to ponder. Such as: What would replace the pound? How would Scotland raise money? What currency will I use for my pint, let alone my mortgage?

There’s no question that Scotland has a welter of resources, such as oil and gas, highly-rated universities and a whisky so wonderful the whole world knows about it. However, aside from the currency issue, there are issues relat-ing to how the country would deal with the loss of billions of pounds handed out by London as well as future oil produc-tion levels. Polls have consistently put support for independence at between 25 percent and 30 percent over the past three years, with support for remaining in the union at between 45 percent and 50 percent. But the number of undecid-ed voters is significant.

UK to Scotland: Bank independence means no pound

An increasing number of Lithuanians are doing business in China these days. In fact, one-fifth of Lithuania’s major producers and nearly half (43%) of food industry busi-nesses are planning to enter the Chinese market this year

According to Aleksandras Izgorodinas, an analyst with the Lithuanian Confed-

eration of Industrialists, the recovery of the European Union market is encouraging Lithuanian businesses to start exporting to China.

“Due to the vulnerable state of Rus-sia’s economy and expected EU market recovery, Lithuania’s companies pay more attention to the new markets and especially

China’s market,” said Izgorodinas.The Lithuanian Confederation of In-

dustrialists, with the support of the govern-ment, is now planning to establish a Coun-cil of Lithuania-China Business.

Exports to China currently make up only 0.45% of all of Lithuania’s overseas trade, but this figure is expected to increase.

Lithuanian businesses lining up to enter Chinese marketLITHUanIa | cHInese markeT

UnITeD kIngDOm |scOTLanD

British Finance Minister George Osborne said Thursday there was no legal reason the rest of the United Kingdom should share the pound with an independent Scotland if it votes to break away in a referendum this year. AFP PHOTO / JAMES GLOSSOP/POOL

23EUROPEAN UNIONNEWEUROPEwww.neweurope.eu16 -22 February, 2014

Poland|Polish immigrants

Polish baby boom in the UKNew research shows that Polish women are having twice as many children in the United Kingdom than in Poland. Accord-ing to the figures released by Britain's Office for National Sta-tistics, the average Polish-born woman in England and Wales has given birth to 2.13 children, while comparative statistics in Poland show the birth-rate at 1.3. The figures also show that Polish-born women are giving birth at a higher rate than Brit-ish women (1.9 children). The new data was published hot on the heels of British Prime Minister David Cameron’s deci-sion to change the rules on child benefits so that they are not wired out of the country by mothers whose children are not living in the UK, but in Poland and other EU member states. According to Professor Krystyna Iglicka, a demographer at the Łazarski University in Warsaw, the data suggests that Polish immigrants in the UK are settled and integrated into society and that they feel secure.

France|swiss Vote

France rethinks relations after swiss votePARIS- France and its European partners will review relations with Switzerland after a "worrying" Swiss vote to reintroduce immigration quotas with the European Union (EU), French Foreign Minister Laurent Fabius said on Monday. "There are accords with Switzerland on the free movement of workers and many other elements since 1999 ... if one of these elements will be called into question ... we are going to review our rela-tions with Switzerland," Fabius told RTL radio. "It's a worry-ing vote because it means that Switzerland wants to withdraw into itself. It's bad news for both Europe and the Swiss because Switzerland will be penalized if it withdraws," the minister added. (Xinhua)

the netherlands|emPloyment

ing to cut hundreds of jobs in the netherlands and BelgiumThe growing popularity of online banking is costing jobs. ING, the international financial services group, announced last week that it will shed 450 jobs - 300 in the Netherlands and another 150 in Belgium. The reason for the cuts, according to ING, is that more and more of its customers are switching to online banking. The job cuts were announced at ING’s pres-entation of its full year figures. The bank’s net profit last year dropped 22% to €3.2bn, ING said in a statement. But this year may be different. “For 2014, I am confident that we are well positioned to achieve our strategic objectives and that we will continue to make progress in completing the restructuring, while keeping our customers at the heart of everything we do,” Ralph Hamers, CEO of ING Group, explained in a statement published on the bank’s website.

BelgiUm|eUthanasia

Belgian lawmakers extend euthanasia to childrenBRUSSELS— Belgian lawmakers have voted overwhelm-ingly to extend the country's euthanasia law to children under 18. The 86-44 vote Thursday in the House of Representatives, with 12 abstentions, followed approval by the Senate last De-cember. The law empowers children with terminal ailments who are in great pain to request to be put to death if their par-ents agree and a psychiatrist or psychologist find they are con-scious of what their choice signifies. (AP)

BEIJING - Chinese President Xi Jin-ping met with Hungarian Prime Minis-ter Orban Viktor on Thursday and they pledged to boost cooperation between the two countries.

Hailing the traditional friendship between China and Hungary, Xi said the Chinese people will not forget Hun-gary's precious help soon after the es-tablishment of the People's Republic of China (PRC) in 1949.

Xi lauded the development of the bilateral relationship over the 65 years since the establishment of China-Hun-gary diplomatic ties, especially over the past decade since they announced their friendly and cooperative partnership.

"The Chinese side stands ready to work with the Hungarian side, continue to support each other and boost cooper-ation in an all-round way to further step up the bilateral relationship," said the Chinese president, highlighting coop-eration in finance, telecommunications, infrastructure and high technology.

Xi also called for cultural, educa-tional and people-to-people exchanges between the two nations, both boasting long history and rich culture.

He said the world is a diversified one and the development path of a country should be decided by its own people.

"Practice is the sole criterion for test-ing truth," Xi said, noting that the Chi-nese people had chosen a path fit for the

national conditions after a long period of trial and error.

Xi briefed Orban on China's national revival embodied by two major goals: the building of "a moderately prosperous society in all respects" by the time the Communist Party of China celebrates its centenary in 2021; and to turn China into a modern socialist country that is prosperous, strong, democratic, cultur-ally advanced and harmonious when the PRC marks its centennial in 2049.

"We have full confidence in our fu-ture," said the Chinese leader.

Orban said Hungary admires China for the great achievement of develop-ment and attributed China's success to the path taken by the Chinese people in accordance with China's own situation.

Hungary advocates multi-polari-zation of the world, supports China's peaceful development and attaches great importance to China's significant and constructive role on the world stage, said the prime minister.

Orban said the Hungarian side looks forward to more high-level interactions, continuous mutual support, closer prac-tical cooperation and deeper friendship with the Chinese side.

During the meeting, Xi also reiter-ated China's endorsement for the inte-gration of Europe and his great atten-tion to the relationship with European countries.

For his part, Orban expressed his gratitude for China's backing for Europe and European integration, pledging to make further efforts to promote coop-eration between China and Europe, es-pecially between China and central and eastern European countries.

Orban arrived in Beijing on Tuesday for a three-day official visit China, where he held talks with his Chinese counter-part Li Keqiang on Wednesday, and met with China's top legislator Zhang Deji-ang on Thursday.

According to a joint statement is-sued on Thursday, China and Hungary signed a series of deals on trade, invest-ment, infrastructure and people-to-peo-ple exchanges during Orban's visit.

In the statement, the two sides pledged to respect each other's sover-eignty and territorial integrity, and take care of each other's core interests and major concerns.

The two countries also reiterated opposition to all kinds of trade protec-tionism.

According to the statement, China welcomes Hungarian investment in Chi-na and will encourage Chinese enter-prises to import more from, and invest more in, the European country.

The two sides also vowed to make joint efforts with the international com-munity to fight terrorism and safeguard cyber security. (Xinhua)

Chinese president meets Hungarian PM

The euro is not the objective of the coali-tion and it has never been discussed. So said the Czech Republic’s Finance Minis-ter Andrej Babis (ANO) in parliament last week. He was responding to a controversial

statement in favour of the euro made by the country’s foreign minister, Lubomir Zao-ralek (Social Democrats, CSSD).

Zaoralek said the government will pre-pare to introduce the Eurozone currency as

soon as possible. According to Babis, the new coalition government has only agreed to join the EU's fiscal pact that obliges all EU countries to transpose into their legisla-tion budget discipline rules.

‘The Czechs don’t want the euro’czech rePUBlic| eUro

hUngary |china

Chinese Premier Li Keqiang (R) escorts Hungary Prime Minister Viktor Orban (L) after witnessing a signing ceremony of their delegations at the Great Hall of the People in Beijing on February 12, 2014. AFP PHOTO / POOL / ROLEX DELA PENA

24 EUROPEAN UNION NEWEUROPEwww.neweurope.eu16 -22 February, 2014

Bulgarian authorities have approved the Environmental Impact Assessment (EIA) Report for the South Stream Offshore Pipe-line, the offshore component of the South Stream Gas Pipeline System, officials said on 10 February.

The EIA Report, approved by Bulgar-ian Ministry of Environment and Water, concluded that the environment will not be significantly affected by the Project, ac-cording to the press release of South Stream Transport (SST), an international joint venture established for the construction and operation of the offshore gas pipeline through the Black Sea.

“We take our environmental and social responsibility very seriously and we un-

dertook a thorough impact assessment to ensure the pipeline will not harm the envi-ronment,” Oleg Aksyutin, CEO of SST said.

The EIA Report contained the findings of the environmental, cultural heritage and socio-economic studies for the construc-tion and operation of the Bulgarian Sector of the South Stream Offshore Pipeline, con-ducted by a team of Bulgarian and interna-tional experts.

The report described the potential im-pact of the project and contained over 200 protection measures that SST would imple-ment to ensure that the project would not have any significant adverse impacts, the press release said.

“Following the positive decision of the

Bulgarian Ministry of Environment and Water, SST is seeking to complete the next stages of permitting to receive all the re-quired construction permits in time to start construction in the middle of 2014,” the company said.

South Stream is a step in pursuing Russian gas mnopoly Gazprom strategy to diversify the Russian natural gas sup-ply routes. South Stream’s offshore sec-tion with the total length of 925 kilome-tres will run under the Black Sea through the exclusive economic zones of Russia, Bulgaria and Turkey. The maximum depth will be more than two kilometers and the design capacity will amount to 63 billion cubic metres.

Authorities approve South Stream environmental report

Romania’s nuclear power plant operator Nuclearelectrica said it plans to invest up to 8.9 million lei (€1.9 million) in the Tarnita-Lapustesti pumped-storage hydropower plant (HPP) project and €2.0 million in the construction of a subsea power cable, SeeNews reported.

Nuclearelectrica said in a statement

it is considering acquiring 2 million shares of the project company that will develop an electricity interconnector between Romania and Turkey under the Black Sea. The shares will have a nominal value of €1 each.

In the project company for the HPP, Hidro Tarnita, Nuclearelectrica plans to

buy 89,000 shares with a nominal value of 100 lei each. The pumped-storage hydro-power plant, which will be located in the northwestern county of Cluj, will require an investment of more than €1 billion and will comprise four reversible pump-turbines of 250 megawatts each. So far, Romania has not attracted any investor in the project.

Nuclearelectrica to invest in HPP project

The head of the Democratic Party has yanked away vital support for Italian Premier Enrico Letta’s government, making it virtually impossible for Letta to stay at the helm of the fragile coali-tion, AP reported.

Florence Mayor Matteo Renzi told fellow party leaders on 13 February it’s time for “radical change” in economi-cally stagnant and politically unstable Italy as he bid for a mandate to shep-herd electoral and other economic re-forms through parliament.

For that to happen, Letta must re-sign, and Italy’s president would have to ask Renzi to put together a new coali-tion solid enough to command a work-ing majority in parliament.

Renzi, 39, has been critical of Letta since December, when Renzi was voted head of their Democratic Party.

Renzi could be tapped to form a new government, but it would need to win a vote of confidence in both houses of Parliament.

Letta, 47, made a pitch to hold on to

power on 12 February, highlighting the economic relief since he took power 10 months ago.

He said the economy is showing signs of growth after years of contrac-tion and the country’s high public debt has begun to decline for the first time in six years.

While analysts say a Renzi gov-ernment could accelerate reforms, it also risks alienating Silvio Berlusconi’s center-right party, an influential com-ponent of the opposition.

SPAIN|ECONOMY

BBVA: Economy to grow 0.9% this yearThe Spanish economy will grow 0.9% this year and 1.9% in 2014, BBVA, the country’s number two bank, said in a report released on 11 February. The rhythm of growth will be enough to create jobs in a sustained manner but it will not reduce the unemployment rate significantly, given that this will stand at 25.6% in 2014 and only decline to 24.8% in 2015, the bank’s research unit said. The study found that there still exist risk fac-tors that could inhibit the recovery and the bank says it is “indis-pensable” for the European Union to establish a banking union.

ROMANIA|ENERGY

Conpet 2013 prelim net profit rises 21.1%The preliminary net profit of Romanian oil pipeline operator Conpet rose by 21.1% on the year to 37.3 million lei (€8.3 million), the company said. Its gross profit rose to 48.1 mil-lion lei last year from 40.8 million lei a year earlier, Conpet said in its preliminary financial statement for 2013. Conpet’s operating revenues increased 3.2% in 2013 to 391.11 million lei, while its operating costs were 1.6% up on the year at 354.4 million lei. The company’s turnover rose 4.4% to 348.9 mil-lion lei last year. Conpet transports domestic and imported crude oil, rich gas, ethane and condensate through pipelines and by railway tanks to refineries in Romania and the Balkan region. It operates a network of 3,800 kilometres of oil pipe-lines across the country.

CYPRUS|DIVIDED ISLAND

Anastasiades, Eroglu resume peace talksOn 11 February, the leaders of Cyprus’ rival Greek and Turkish Cypriot communities embarked on a new round of talks aimed at achieving the long-elusive goal of reunifying the ethnically split island nation. Greek Cypriot President Nicos Anastasiades and the leader of the breakaway Turkish Cypriots, Dervis Ero-glu met inside the UN-controlled buffer zone that slices through the capital, Nicosia, to herald the restart of talks after a 20-month stalemate. Cyprus was split in 1974 when Turkey invaded after a coup aiming for union with Greece. Only the internationally recognized, Greek Cypriot-dominated south enjoys the benefits of the island’s 2004 European Union entry. Talks resumed after the two leaders agreed on a document outlining key provisions of an envisioned federation. It’s a different approach from pre-vious talks, one that Anastasiades insisted was necessary to pre-vent talks from dragging on without results like so many earlier rounds of negotiations over the last four decades.

ITALY|ENERGY

ENI discovers new oil in Republic of CongoOn 13 February, Italy’s energy major ENI announced a vast oil discovery in the Republic of Congo. “This is an Elephant find,” the WSJ quoted ENI CEO Paolo Scaroni as saying. “Africa is our backyard,” Scaroni said in describing the Ital-ian company’s success in new discoveries. “Discoveries aren’t over” as two further wells are due to be tested, he said, refer-ring to the offshore Republic of Congo finds. The company now estimates there are 1.2 billion barrels of oil and 30 billion cubic metres of gas in place, with an overall potential of about 2.5 billion barrels of oil equivalent.

ROMANIA|ENERGY

BULGARIA|ENERGY

ITALY|POLITICS

Rival yanks vital support from Letta

Italian Prime Minister Enrico Letta leaves after a press conference in Rome’s Palazzo Chigi Palace government office, 12 February 2014. AFP PHOTO/FILIPPO MONTEFORTE

25ENLARGEMENTNEWEUROPEwww.neweurope.eu16 -22 February, 2014

AlbAniA|DemilitArizAtion

Albania to continue demilitarization processTIRANA - Albanian Defence Minister Mimi Kodheli said Friday the country will continue the ongoing demilitarization process, including eliminating hazardous chemicals, old am-munition and small arms and the cleaning of former military hot spots. In a round-table discussion at the Demilitarization Factory in Elbasan, central Albania, Kodheli said the country has dismantled around 80% of its aged ammunition stockpile over the past five years, and more than 100 tons of hazardous chemicals were repacked last year. “We will continue to carry out demilitarization process and improve working conditions in military factories,” Kodheli said, adding that Albania will expand demilitarization to build “a clear and safe country.” Kodheli thanked international donors for providing assistance in disposing of the country’s large stockpiles of aging ammuni-tion, but said Albania needs more funding for the removal of chemicals and ensuring they are safely destroyed abroad. Flo-rian Raunig, representing the Organization for Security and Co-operation in Europe (OSCE) in Albania, said the organi-zation is considering launching a new phase of hazardous ma-terials removal and destruction at the request of the Albanian Ministry of Defence. “Together with the ministry and poten-tial donors, we will explore possibilities for further assistance in this area,” Raunig said, describing the decommissioning of small arms and light weapons as “another challenge.” (Xinhua)

turkey|religion

istanbul’s new mosque boasts new designOf the tens of thousands (there are more than 85,000) mosques in Turkey, one Muslim prayer hall stands out above the rest. It is the country’s newest mosque in Buyukcekmece, Istanbul. The Sancaklar Mosque is spread over an area of 1,200 square metres. According to architect Emre Arolat, who designed the mosque, it is modern and free of all the mosque stereotypes. “The interest that the construction of that mosque revealed has shown that my aim is not unfounded at all,” Arolat told the SES Türkiye news website. “Citizens in Turkey, especially pious ones, have had mostly positive feedback after having strolled around and used the mosque for their worship. It is the biggest prize that I, as an architect, can obtain to see people who have internalised this building I worked on for years.” According to Arolat, prayer areas should be simple and show a kind of mod-esty to highlight the “essence” of religion. “Sancaklar Mosque follows these requirements and establishes a similar relation-ship with its congregation.

turkey|Securit y

turkey, Afghanistan, Pakistan vow to cooperate on security ANKARA - Leaders of Turkey, Afghanistan and Pakistan on Thursday pledged further cooperation on security and eco-nomic development, particularly reconciliation and peace building efforts on Afghanistan. “We have exchanged views on achieving peace and security in Afghanistan and Pakistan. We have conducted friendly and transparent discussions in these issues,” Afghanistan’s President Hamid Karzai said in a joint press conference with Turkish President Abdullah Gul and Pakistani Prime Minister Nawaz Sharif after the two-day trilateral summit held in the Turkish capital of Ankara. “Some concrete steps will be taken in field of economy, particularly on transportation,” the Turkish president stated. Pakistani Prime Minister Nawaz Sharif said that his country was determined to keep up good neighborhood relations with Afghanistan.

Turkish parliament is as busy as ever these days, as lawmakers find themselves scrambling to attend meetings and de-bates on several key draft laws tabled by the government. One of the most controversial pieces of legislation is the government’s proposal to shake up the country’s judicial system. A new contro-versial bill that will restructure the coun-try’s Supreme Council of Judges and Prosecutors (HSYK) will soon be tabled by Justice Minister Bekir Bozdağ.

The government last month was forced to backtrack on several articles in-cluded in the bill after critics warned the new measures would serve to increase the state’s power over the justice system.

The government needs to win the

approval of the opposition parties in or-der to secure a two-thirds majority in the parliament to pass the bill.

According to Bozdağ, the latest ver-sion of the new HSYK bill will be put on parliament’s agenda after lawmakers vote on a new draft law about the Disas-ter and Emergency Management Presi-dency (AFAD) institution. Lawmakers are currently debating yet another high-priority draft law amending the coun-try’s military legislation. This is also controversial, as critics warn that it will undermine the promotion system in the Turkish Armed Forces (TSK).

Also in the parliament, the Constitu-tion Commission have started to debate a so-called “democratisation package” on

fundamental rights and freedoms. An-other debate on a package of new judicial measures is being debated by members of parliament’s Justice Commission.

According to the main opposition Republican People’s Party (CHP), the commission meetings are overlapping and making it difficult for lawmakers to attend both. The party filed an official complaint to the office of the Parlia-ment Speaker calling for a new schedule. “When the link and content of each of the two bills are taken into considera-tion, members of the Constitution and Justice Commissions are obliged to per-sonally follow both bills,” the CHP said, arguing that this was not possible with the current timing.

Turkish lawmakers busy with new bills

Turkey appears keen to show the interna-tional community that it is taking a strong stance against Islamic extremists and that it has zero tolerance for terrorism.

Earlier this month, the Turkish army opened fire on a convoy of Islamic State of Iraq and the Levant (ISIS) - a jihadist group active in Iraq and Syria. This was in retalia-tion for a series of cross-border strikes that hit Turkish soil. Turkey has also warned of possible terrorist attacks in Istanbul after receiving intelligence that al-Qaeda-linked jihadists were planning to disrupt the Syr-ian peace talks.

According to Cenap Cakmak, an as-sociate professor of International Law and Politics at Eskisehir Osmangazi University, Turkey needs to send a clear message that regardless of the role it plays and the contri-bution it makes to the opposition groups, al-Qaeda will not be tolerated.

“This is particularly important because the ongoing conflict is being portrayed also as a sectarian divide, suggesting that Turkey may become inclined to support Sunni groups. In order to preserve its nor-mative approach, Turkey therefore needs to act carefully. This recent incident may be analysed from this perspective: that Turkey

is not tolerant of any incident of al-Qaeda-linked extremism,” Cakmak told the SES Türkiye news website.

But Alper Dede, an assistant profes-sor of international relations at Zirve University in Ankara has another take on the situation. He told SES Türkiye that the most recent attack was not part of a deliberate plan to clamp down on the ISIS, but “just a quick response to the

shootings at the border”. Meanwhile, Turkey has been accused

of secretly supplying arms to rebel groups fighting against the Syrian leader. Ankara has denied it.

The war in Syria has killed more than 130,000 people and forced more than 2.3m civilians to flee the country. An estimated 600,000 Syrian refugees are currently in Turkey.

Why Turkey needs to stand up against al-Qaeda

The President of FYROM met with Rus-sian Orthodox Church Patriarch HH Kiril in Moscow last week. The two discussed efforts to settle the Macedonian Orthodox Church-Ohrid Archbishopric (MOC) canonic status.

“Finding ways to canonize MOC is

very important at this time. The canonic status of your church is of enormous im-portance, because it will secure the [FY-ROM] identity, language and culture”, said Patriarch Kiril, who stressed that the Former Yugoslav Republic of Macedonia and Russia are building on two decades

of friendly diplomacy. “We are politicians with a mandate, but church issues have no mandate,” said Ivanov. “They are settled in long periods... Our followers should have the Christian virtue of patience, meaning church issues should be gradually resolved through dialogue and building trust.”

From FYROM to Russia with loveFyrom |ruSSiA

turkey | iSlAmic extremiSm

turkey |lAwS

Men carrying children run out of a burning building following a barrel bomb attack reportedly dropped by government forces in the northern Syrian city of Aleppo on February 8, 2014. AFP PHOTO/BARAA AL-HALABI

26 ENLARGEMENT NEWEUROPEwww.neweurope.eu16 -22 February, 2014

SERBIA|ENERGY

Serbia seeks financing for HPP Pirot upgradeOn 11 February, Serbian Energy Minister Zorana Mihajlovic said talks are planned with international lenders on financ-ing for an upgrade at the Pirot hydro power plant (HPP), SeeNews reported. The investment plan, being drafted by the energy ministry and state-owned power utility EPS, calls for investments of €10-20 million in the HPP upgrade, Mihajlovic said in a statement posted on the government’s website after she toured the site of the power station which is part of the Djerdap hydro power complex. HPP Pirot, launched in 1990, operates only during times of peak power demand. Pirot is a town located in eastern Serbia.

SERBIA|ENERGY

Corpbank, partners eye Serbian energy projectsBulgaria’s Corporate Commercial Bank is interested in in-vesting alongside partners in local thermal power projects, the Serbian Energy Ministry said on 10 February, SeeNews reported. Bulgarian investor is eyeing the projects for the construction of the Stavalj and Despotovac thermal power plants (TPPs) and for a new unit at the Morava TPP, the min-istry said in a statement issued after energy minister Zorana Mihajlovic met with the lender’s supervisory board chair-man Tsvetan Vasilev in Belgrade to discuss potential invest-ments. Vasilev was leading a delegation comprising experts from the mining and energy industries. The statement added that talks will be held in parallel with all investors interested in the Stavalj thermal energy and coal mining project, which includes firms from the Czech Republic and China. Two weeks ago, the Serbian government adopted a decision to set up a task force for the implementation of the Stavalj project. The team will explore the opportunities and the strategic partnership options for the restructuring of the Stavalj mine and the possible construction of a 300 megawatt TPP. As of the end of 2013, Corporate Commercial Bank, Corpbank, was the fourth largest among Bulgaria’s 24 locally-registered lenders and branches of six foreign-based banks.

MONTENEGRO|AGRICULTURE

Agriculture enters demanding EU negotiation phaseMontenegro’s accession to the EU is entering a phase where the focus shifts from the rule of law, treated as a top priority at this point in time, to the issues such as agriculture, food safety and consumer protection, Dirk Lange, head of the Monte-negro Unit at the European Commission’s Enlargement Directorate, and Mitja Drobnic, Head of EU Delegation to Montenegro, noted following their visit to several agricultural manufacturers in Montenegro, the country’s government said in a press release. Montenegro’s agriculture has entered a more demanding negotiation phase, which requires more quickly adoption of standards and boosting farmers’ competitiveness in order to increase chances of selling their products on Euro-pean market. High product quality and compliance with food safety standards are the minimum requirements to be met, Lange pointed out. After their visit to Kolasin, the two EU representatives and Montenegro’s Agriculture Minister Petar Ivanovic visited a number of agricultural producers and in the north of Montenegro, as well as the company Plantaze 13 jul, Montenegro’s top exporter. Lange said that farms in Montene-gro are small and they hardly use modern technology, which certainly causes an increase in the cost of production. There-fore they require structural changes, he explained.

On 10 February, thousands protested in a dozen Bosnian cities to demand that politicians be replaced by non-partisan experts who can better address the nearly 40% unemployment and rampant corrup-tion, AP reported.

It was the sixth day of the worst unrest the Balkan country has seen since the end of the 1991-95 Bosnian war, which killed 100,000.

“My father, mother and brother are unemployed,” said Meliha, a 34-year-old former art professor who earns €7 a day waiting tables. She refused to give her last name fearing she would lose that job as well. “I’ve had enough!”

Two elderly people held a banner not-ing that one politician’s monthly salary equals four years of the average pension payment. Protesters say overpaid politi-cians are obsessed with inter-ethnic bick-ering. “They are living in a different world, completely disconnected from the peo-ple,” said Anes Podic, a computer engineer without a steady job.

Protesters have gathered daily by the presidency in Sarajevo, the capital, and in a dozen other cities. They set the presi-dency and other government buildings ablaze on 7 February, with graffiti on one reading:

“He who sows hunger, reaps anger.”Local governments in five cities, in-

cluding Sarajevo, have resigned long be-fore October general elections.

The peace deal that ended the war cre-ated a complex political system in which more than 150 ministries govern Bosnia’s four million people. Corruption is wide-spread and high taxes eat away at pay-checks. One in five Bosnian lives below the poverty line. Svjetlana Nedimovic, an unemployed political scientist, accused

the European Union — whose 28 foreign ministers were discussing Bosnia on Mon-day — of turning its back on her country even as it supports protesters in Ukraine.

“We tried elections, peaceful protests — nothing worked,” said Nedimovic, 40. “All those who were teaching us democ-racy are now bailing out.”

In Brussels, EU foreign policy chief Catherine Ashton urged the authorities to guarantee the right to peaceful protests and to act on the people’s demands.

Angry protesters want new government of experts

On 11 February, Serbia’s war crimes court convicted nine former paramilitary mem-bers of the brutal killings of more than 100 ethnic Albanian civilians during the Kosovo war and sentenced them to between two and 20 years in prison, AP reported.

The crime by the “Jackals” paramilitary group includes the massacre of 41 people in the Kosovo village of Cuska, where Serbs rounded up villagers, robbed them, separat-ed women and children from men, locked the men in a house and set it on fire.

The crime in Cuska and three other villages in western Kosovo in May 1999 were among the most brutal of the 1998-

99 conflict that killed 10,000 people after independence-seeking Kosovo Albanians rebelled against Serbian rule. The brutality of Serbia’s crackdown prompted NATO to intervene with airstrikes to stop the war.

Rexhep Kelmendi, one of only three survivors of the massacre in Cuska, wel-comed the verdicts on 11 February but said they fell short of easing the anguish families have lived with for over a decade.

“I think the pain will never go away,” Kelmendi said.

Kosovo’s top defense official, Agim Ceku, whose family members were killed, said the verdicts fell short of overcoming

differences between Serbia and Kosovo, which declared independence in 2008. He blamed Serbia’s top leadership at the time with launching a violent campaign against ethnic Albanians. “This is not a massacre by a group of paramilitaries that did this on this on their own,” he said. “This is a massacre that was planned and executed by the state of Serbia.”

Judge Snezana Nikolic Garotic said in her reasoning the civilians were attacked with the aim of forcing them to leave Koso-vo and never come back. Civilian property was destroyed so they would have nothing to return to, she added.

9 Serbs jailed for Kosovo massacre

On 11 February, Montenegro’s Deputy Prime Minister and Minister of Foreign Affairs and European Integration Igor Luksic participated in Brussels in a work-ing dinner attended by foreign ministers from the EU member states and the can-didate countries, traditionally hosted by EU High Representative Catherine Ashton. The working dinner was also

attended by EU Commissioner for En-largement and Neighbourhood Policy Stefan Fule, the government of Monte-negro said.

Ashton praised Montenegro’s partic-ipation and contribution to common for-eign and security policy of the EU, as well as its constructive contribution to the promotion and strengthening of regional

cooperation in the context of European integration of the Western Balkans. For his part, Luksic said maintaining good dynamics of the integration process of the Western Balkan’s countries and their rapid overall development require fur-ther reinforcing of regional cooperation and stressed the need to further improve the existing cooperation mechanisms.

Ashton, Luksic address common foreign policy issues

SERBIA|POLITICS

MONTENEGRO|EU AFFAIRS

BOSNIA-HERZEGOVINA|PROTESTS

Bosnian citizen rights activists block traffic at one of busiest intersections in Sarajevo, 11 February 2014. AFP PHOTO/ELVIS BARUKCIC

27PARTNERSNEWEUROPEwww.neweurope.eu16 -22 February, 2014

Strict prioritisation and increased capital efficiency are the two main reasons Nor-way’s biggest energy provider Statoil has decided to reduce its investment budget.

Statoil announced it will invest $20bn on average per year between now and 2016. This is a reduction of 8%.

“The industry is facing demanding challenges and we address these from a position of strength. We have a com-petitive resource base, a robust financial position and a highly competent organi-sation recognised for its technological and operational experience,” explained Statoil’s president and CEO, Helge Lund.

According to Lund, the company’s strategy is still value creation and growth. “But we are making some important changes,” he said. “Stricter project prior-itisation and a comprehensive efficiency programme will improve cash flow and profitability. Our strong balance sheet enables prioritisation of capital distribu-tion to shareholders.

Between 2014 and 2016, Statoil ex-pects to maintain return on average capi-

tal employed (ROACE) around the 2013 level based on an oil price of $100 per barrel (real 2013). Production growth is estimated at 2% this year and 3% organic CAGR from 2013 to 2016.

Statoil is also planning to drill some 50 wells this year and another 20 high-impact wells from 2014 to 2016. The company has earmarked $3.5bn for ex-ploration spending this year.

Norway’s Statoil grounds investments

Up until now, the news was about the financial crisis and the mass exodus of university graduates fleeing Iceland in search of employment opportunities in other Scandinavian countries or in the United Kingdom and the United States. Today, it’s all about economic recovery and new arrivals.

Official figures show that Iceland has finally returned to net immigration since the country’s devastating financial crisis in 2008.

An estimated 7,900 people had emi-grated from Iceland each year between 2009 and 2012, while some 5,700 for-eign migrants and refugees arrived on its

shores annually. The big news came last year when

the number of Icelanders fleeing the country dropped 13% and immigration increased 19%. The result: a net immi-gration increase of 1,600.

Iceland’s population is currently 322,000, according to official figures.

Iceland’s cool shift from emigration to net migration

The United States may slap economic sanctions on Iceland unless this North Atlantic nation does not stop whaling. Ac-cording to the US Department of Interior, Iceland is violating the Convention on In-ternational Trade in Endangered Species of Wild Fauna and Flora.

It is now up to US President Barack Obama to decide whether to impose eco-nomic sanctions. He has two months by which to render a decision.

Iceland is one of two countries in the world (Norway is the other) that do not comply with a global moratorium on com-

mercial whale hunting. The measure was introduced in 1986 to help save the whales from extinction.

In the case of Iceland, the government increased quotas to 383 whales this year. Almost all of the whale meat is exported to Japan.

Obama to decide whether to punish Iceland for whaling

By John Heilprin, Associated Press

GENEVA — Nestle, the world’s biggest food and drinks maker, said Thursday it ex-pects 2014 to be just as challenging as last year amid falling growth in emerging mar-kets and weaker prices in Europe.

The maker of Nescafe, Perrier, Jenny Craig and Haagen Dazs is a major buyer of food commodities such as wheat, sugar, and milk and its results are a good indicator of the strength of consumer demand around the world. Nestle, based in Vevey, Switzer-

land, said that after a weak 2013, it expects an improvement only in the second half of 2014. Organic sales, which do not reflect acquisitions and currency fluctuations, are expected to grow about 5 percent next year.

Its net profit in 2013 fell to CHF10bn, from CHF10.6bn in 2012. In 2011, it made a profit of CHF9.5bn.

“The macro-environment in 2013 was one of soft growth, minimal in the devel-oped world and below recent levels in the emerging markets,” CEO Paul Bulcke said. “Last year was challenging and 2014 will likely be the same.”

He said this year would likely again see improvement “weighted to the second half.” Nestle, like other food companies, is facing slowing demand in emerging markets and in Europe, where many customers are ad-justing to government austerity measures.

In 2013, Nestle’s overall sales grew by 2.7% to CHF92.2bn, kept back by the im-pact of shifting foreign exchange rates. It said organic sales growth was 4.6%.

Nestle’s aim every year for 5-6% organic growth and improvements in its trading op-erating profit margin, underlying earnings per share and capital efficiency.

Nestle: consumer demand to remain weak in 2014

NorwAy|Courts

securing security of Norway’s courts Security was high both inside and outside the Oslo Court-house when Anders Behring Breivik, the confessed Norwe-gian terrorist, stood trial. But these were extraordinary cir-cumstances that required extra security. Usually, anyone can attend a trial without even so much as showing their ID at the door. Security checks are lax. The public is rarely asked to walk through a metal detector before entering the courthouse. The Oslo Courthouse, however, has repeatedly asked officials to install security controls. Last November, the government had reportedly earmarked 33.3m Norwegian Krone to beef up security at the country’s largest courthouse. The money, however, never came. In an interview with VG, Norway’s big-gest newspaper, State Secretary Vida Brein-Karlsen, said: “We did not have a lot of time when we took over government re-sponsibility, and there were some urgent matters that had to be prioritised. However, I would like to say this: This government truly does prioritise the security of our courts, so we will have to see how the budget processes turn out”.

NorwAy|syriA

Norwegian charged with syrian terror offensesSTAVANGER, Norway — Police in Norway say they have charged a man with terror offenses allegedly committed in Syria — the first such case in the Scandinavian country. Secu-rity Police spokesman Martin Bernsen said Thursday that the 22-year-old man of Pakistani background was arrested Friday on his return to Oslo from Syria. The suspect, who was not named, has been charged under laws forbidding Norwegian citizens from supporting or joining terror groups. Local me-dia widely report he is being investigated in connection with terror groups linked to al-Qaida. The suspect’s lawyer, John Christian Elden, says the charges relate to actions committed against Syrian government forces and could not be considered “terrorism from a Western country’s viewpoint.” Elden said Thursday the man is being treated in a hospital for gunshot wounds. (AP)

switzerlANd|MediCiNe

Nestlé exchanges stake in l’oreal for Galderma JOHN HEILPRIN, Associated PressGENEVA — Swiss food and drink group Nestle is creating a new unit for medical skin treatments via a deal that reduces its stake in French cosmetics company L’Oreal. The Vevey, Swit-zerland-based company said Tuesday it would take full owner-ship of Swiss dermatology pharmaceuticals company Galder-ma, which had been a 50/50 joint venture with L’Oreal. It will use Galderma’s management to form a new unit called Nestle Skin Health SA. Nestle is striving to reposition its food-and-beverage business more into the nutrition and wellness fields. Galderma’s business fits in that new mold. “The future of skin health and dermatology is a buoyant market globally,” Nestle CEO Paul Bulcke said. Galderma, a Swiss company created in 1981, sells products in 70 countries that treat skin diseases in-cluding acne, psoriasis and cancer. The deal is subject to regu-latory approval. As part of the complicated deal, which is val-ued at €6.5bn, Nestle’s stake in L’Oreal will fall from 29.4% to 23.3%. L’Oreal will buy back 48.5 million of its own shares and then cancel them. Nestle chairman Peter Brabeck-Letmathe said the deal did not mean the company was abandoning its involvement in L’Oreal. “Nestle will continue to support the development of L’Oreal as in the past 40 years,” he said.

NorwAy |eNerGy

NorwAy |wHAliNG

iCelANd |Net MiGrAtioN

switzerlANd | BusiNess

Company reduces investment but aims to boost productivity. EPA/HAGEN OEYVIND/STATOIL/HO

28 EASTERN PARTNERSHIP NEWEUROPEwww.neweurope.eu16 -22 February, 2014

GEORGIA|DIPLOMACY

Panjikidze does not rule out Russia-Georgia meetingGeorgian Minister of Foreign Affairs Maia Panjikidze does not rule out a possible meeting between the Georgian and Rus-sian top officials. Top officials of Georgia are ready for this step, the Messenger quoted Panjikidze as saying. Panjikidze said she has never excluded such a meeting after Georgia launched normalising relations with Russia, though she said it is very serious to prepare for this step, which needs a certain period of time and cannot be managed today or tomorrow. Panjik-idze said that the format of the meeting between the Georgian Prime Minister’s special representative in Russian relations, Zurab Abashidze, and the Russian deputy foreign minister, Gregory Karasin, is acceptable, but it does not solve the “main problem” between the two neighboring countries, concerning the breakaway territories. “The major priority of Georgia’s for-eign policy is de-occupation and unification of the country”, Panjikidze said.

GEORGIA|HUMAN RIGHTS

Margvelashvili meets with Thomas Hammarberg Georgian President Giorgi Margvelashvili hosted the Euro-pean Union Special Representative for Legal Reforms and Human Rights in Georgia, Thomas Hammarberg, the Mes-senger and Rustavi 2 reported. At the meeting, the sides spoke about the reforms, which are carried out in Georgia for the protection of human rights. Hammarberg said after the meet-ing that he had a very constructive conversation with Margve-lashvili. Hammarberg said the strategy that the Parliament has to adopt with the basic principles of human rights and then the action plan, would contain all the basic human rights, which would be important for Georgia to implement in reality.

GEORGIA|BORDERS

Council determines border management strategy On 11 February, the Interagency Council on the Georgian In-tegrated Border Management Strategy held its first meeting, planning to develop an appropriate strategy and submit it to the Cabinet of Ministers for approval before 1 March, local press reported. The council includes representatives of the agencies involved in border management. It is headed by the prime minister’s assistant and secretary of the Council for Se-curity and Crisis Management. The meeting on 11 February discussed a release version of the strategy and identified key priorities.

GEORGIA|ENERGY

Transmission power line construction starts The construction of 500 kilovolt intersystem transmission power lines is starting in Georgia’s Dariali Gorge, local press reported. Georgian Energy and Natural Resources Minister Kakha Kaladze told journalists that there is no specific project on construction of power transmission lines yet, but this will be extremely important for the country’s power grid in case of a future prospect of connecting the power grids of Georgia and Russia with help of 500 kilovolt power transmission lines. “Today we get the electricity purchased from Russia with help of the Kavkasioni power transmission lines, which suffer from accidents.

On 12 February, Georgia called on for-eign visitors to the Winter Olympics to keep out of Abkhazia, a Russia-aligned breakaway territory just south of Sochi along the Black Sea coast, AP reported.

The International Olympic Com-mittee, however, said there was no rea-son not to go to Abkhazia.

Abkhazia declared independence shortly after Russian forces crushed the Georgian army in a brief 2008 war, but most of the world still considers it Geor-gian territory. Only Russia, Venezuela, Nicaragua, and two Pacific island na-tions have recognized Abkhazia as an independent country.

Russia’s attempts to facilitate travel across its border with Abkhazia, only five kilometers (three miles) south of Olym-pic venues, was “a provocation aimed at undermining the sovereignty and ter-ritorial integrity of Georgia” and “mis-leading foreign citizens,” the Georgian Foreign Ministry said in a statement. Asked the IOC’s view on Olympics visi-tors going to Abkhazia, IOC spokesman Mark Adams said “why not”.

“The talks and exchanges between the two governments, that’s entirely been to the two governments,” he said. “In terms of going to Abkhazia ... well if it’s safe, people will go there.”

Alexandra Kosterina, spokeswom-an for the Sochi organizers, refused to comment. While Abkhazia and another breakaway region, South Ossetia, re-main sticking points in restoring dip-lomatic relations between Georgia and Russia, Russian President Vladimir Pu-tin said Monday that he hoped the Sochi Games would help to mend fences and expressed a willingness to meet with his Georgian counterpart.

The Georgian government respond-

ed positively to Putin’s overture.Mutual personal enmity had pre-

vented any meeting between Putin and former Georgian President Mikhail Saakashvili, whose term ended in No-vember.

The Russian Foreign Ministry said a possible meeting between Putin and Georgia’s new president, Giorgi Marg-velashvili, would be discussed at talks in early March between envoys from the two countries.

Georgia: Olympic guests must not visit Abkhazia

On 12 February, Armenian Prime Minister Tigran Sargsyan and Iranian Am-bassador to Armenia Mohammad Raeesi in a meeting in Yerevan conferred on ways to consolidate bilateral relations and mutu-al co-operation between the two countries.

The Armenian premier called for the further expansion of ties between Armenia

and Iran, and said, expansion of ties with the Islamic Republic of Iran is prioritised in Armenia’s foreign policy.

The two sides also discussed issues re-lated to economic and commercial co-op-eration, construction of Iran-Armenia third transmission line of high-voltage electricity.

For his part, the Iranian ambassador

said Tehran deems as important relations with Armenia and it makes efforts for its expansion. Raeesi said expansion of co-operation with Armenia in different areas is priority of Iran’s foreign policy, adding that broadening of bilateral ties, especially in the fields of energy and transportation are of special importance.

Yerevan, Tehran to expand co-operation

Georgia’s security and defence reforms, including at the political level, are “very good and very positive,” stated NATO’s Military Committee following its first ever visit to Georgia on 11-12 February.

Leading the delegation of represent-atives from NATO’s 28 member coun-tries, General Knud Bartels expressed the Committee’s “strong support” for the reforms, and said that he was “confident that the transformation is comprehen-sive, solid and irreversible”.

Speaking at a press conference fol-lowing a bilateral meeting on 12 Febru-ary, Georgian Minister of Defence Irakli Alasania thanked the Alliance for its

“support in the implementation of our reforms,” highlighting in particular the NATO initiatives helping to “increase the transparency of the defence budget and accountability towards Parliament and the people.”

“NATO views Georgia as an ex-tremely reliable partner”, said General Bartels, and “stands side-by-side with Georgia on its path towards Euro-Atlan-tic integration.” The Committee backed “further strengthening military coopera-tion with Georgia.”

Reforms have depoliticised the Georgian armed forces, increased trans-parency and oversight from the parlia-

ment, civil society and the media, and tackled corruption. Operational reforms have also increased professionalism and overall defence capabilities, allowing Georgian troops to today operate at “ex-actly the same level as all the other na-tions” of the Alliance, according to Gen-eral Bartels.

The Military Committee also expressed NATO’s deep appreciation for Georgia’s contribution to international security. “Georgian military personnel continue to stand ready to make the ultimate sacrifice for peace whilst endeavouring to prevent crisis, manage conflicts and stabilize post-conflicts situations,” Bartels said.

NATO: Defence sector reforms ‘comprehensive’

GEORGIA|DIPLOMACY

GEORGIA|DEFENCE

ARMENIA|DIPLOMACY

An Abkhazian woman hangs her wares in the street market in Sukhumi, Abkhazia. EPA/YURI KOCHETKOV

29EASTERN PARTNERSHIPNEWEUROPEwww.neweurope.eu16 -22 February, 2014

Russia remained Belarus’ main trading partner in 2013, with bilateral trade total-ing almost $39.7 billion, reads the review of the operation of the Foreign Ministry and Belarus’ foreign policy in 2013 compiled by the Ministry, BelTA reported.

Russia accounted for 49.5% of Bela-rus’ entire trade. Belarus was among Rus-sia’s six most-important trading partners.

The Foreign Ministry notes that the Belarus-Russia intensive dialogue at the high and highest level allowed the coun-tries to reach fundamental agreements in different areas of bilateral relations such as industry, power engineering, finance, R&D and military and technical co-op-eration. The sides got down to practical implementation of major integration projects which are designed to branch out into high-quality and competitive products by uniting the potential of the two countries in such key areas as auto-mobile industry, electronics and chemi-cal industry. The implementation of the

joint project to construct the Belarusian nuclear power plant with the Rosatom corporation was also continued.

The review reads that traditionally tight coordination of activities of the two countries’ foreign ministries improved the states’ influence in the international scene. The major areas of such co-oper-ation were laid down in the 2014-2015 programme on coordinated actions in the field of foreign policy of the mem-bers of the agreement on the establish-ment of the Union State. “The Union State of Belarus and Russia continued to be the powerhouse of CIS integration,” reads the review.

In 2013 Belarus took an active part in the development of the Eurasian inte-gration project and continued to step up co-operation with the Customs Union (CU)/Single Economic Space (SES) and the Eurasian Economic Commission (EEC). Systemic work was carried out to harmonize Belarus’, Russia’s and Kazakh-

stan’s views on the future Eurasian Eco-nomic Union treaty. The Foreign Ministry noted that the first three meetings of the Supreme Eurasian Economic Council at the level of heads of state, the meeting of the Supreme Eurasian Economic Council at the level of heads of government and 12 meetings of the EEC Council resulted in 140 resolutions on tariff and non-tariff reg-ulation, standardization, technical regula-tion, industrial and agro-industrial policy, the formulation of common competition and public procurement rules, co-opera-tion in transport, power engineering and information exchange. Work continued to codify the CU/SES legal framework and eliminate barriers for free movement of goods, services, capital and labor force on a step-by-step basis. A roadmap on Armenia’s accession to the CU/SES was approved. Work continued to develop a roadmap on Kyrgyzstan’s accession to the Customs Union and draft a number of free trade agreements.

Russia-Belarus trade totals almost $39.7 billion

MOLDOVA|EU AFFAIRS

Timofti urges MPs to continue EU integrationOn 13 February Moldova’s President Nicolae Timofti urged the MPs to be united to decisively anchor Moldova into the European area, Moldpres reported. In the beginning of the first plenary meeting of the parliament’s new spring-summer ses-sion, Timofti said the 2014 was a year that should mark Mol-dova’s detaching from the post-Soviet transition period and to decisively anchor the country into the European space. “Our will is to put an end to oscillations between east and west. The Moldova-EU Association Agreement, which is to be signed, gives us possibilities to improve the citizens’ living and it is ex-tremely important that the EU integration strategy be imple-mented and all Moldovan districts be involved in this process. And those who insist on nobody waiting for us in Europe make a diversion against Moldova,” Timofti said. “We need palpable results, which can be achieved only through co-operation and the political and financial support we are benefiting from Eu-ropean states is crucial. We are bound by the mandate that we got from the citizens to focus on measures to modernise the country. The citizens must regain confidence in the state’s in-stitutions and I urge you to be closer to them by laws. Presently, we have the chance to fulfil our nation’s hopes,” Timofti added.

BELARUS|BUSINESS

Development Bank to consider SME funding in Q3In the third quarter of this year, the Development Bank of of Belarus plans to determine the amount of money that will be available for small and medium business projects, DBRB Chairman of the Board Sergei Rumas said on 12 February, BelTA reported. “Small and medium business is both a prior-ity and a prospect for us. We work in tight cooperation with World Bank experts to establish an effective scheme to credit this branch of the economy. We hope to establish productive collaboration with several Belarusian banks that have advanced furthest in this regard. We are likely to credit small and medium business via agent banks,” he said. The scheme is widely used by major development institutions, he explained. “I think in the third quarter of 2014 we will determine the amount of money available for small and medium business,” Rumas said. As the first step in its work with SMEs the Bank intends to offer loans to Belarusian farmers, who need new agricultural machines. “We are now structuring the deal in association with Promag-roleasing Company in order to offer affordable loans to the clients,” Rumas said. The organisational establishment phase of the Development Bank is over: it now has a team of profes-sionals and operates a chain of outlets in the oblast capitals of Belarus. The Development Bank of Belarus is a specialised fi-nancial institution operating as a stock corporation. The Bank has been tasked with financing projects as part of government programs, with buying out the loans issued by other banks to finance government programmes, and with providing support to Belarusian exporters on preferential terms.

BELARUS|ENERGY

Belarus intensifies energy reductionIn decreasing the level of energy consumption per unit of GDP Belarus has almost approached the world’s leading countries, Belarus’ First Vice Premier Vladimir Semashko said at the meeting of the State Committee for Standardiza-tion on 12 February, BelTA reported. “We have developed a system on GDP energy intensity reduction which has al-ready yielded great results,” the Belarusian official said.

On 13 February, EU Enlargement Com-missioner Stefan Füle urged Ukrainian leaders and opposition to form a coali-tion government as a way out a nearly three month-long political crisis, and is warning authorities against harassing protesters.

Füle told reporters that he has called on the two sides to agree on a constitu-tional reform that would trim presiden-tial powers and bolster the authority of parliament.

It is hard to win the trust of the dem-onstrators amid the continuing “arrest, the intimidation, the harassment of pro-testers and activists,” Füle added.

The protests erupted in Novem-ber after President Viktor Yanukovych spiked a treaty with the EU in favor of a

loan from Moscow, and were fueled by police abuse. Yanukovych still enjoys strong support in eastern Ukraine.

Füle’s statement follows an EU for-eign ministers pledge on 10 February to “pursue its efforts” to “assist” Ukraine once it has a reform-minded govern-ment in place and is implementing “well-established conditions” for aid.

The ministers sought to encourage Ukraine to cement EU ties, saying the bloc’s offer of an economic and political agreement with Ukraine doesn’t “con-stitute the final goal in EU-Ukraine co-operation”.

At a news conference on 10 Feb-ruary, foreign-policy chief Catherine Ashton made clear there had been no major movement on this point but said

all wanted to see ties deepened. “I think wherever people believe the future might be, everybody recognises that there is more to be done in the relation-ship with Ukraine,” she said. “There are many things that could happen in the future.”

In related news, the daughter of Ukraine’s imprisoned former Prime Minister Yulia Tymoshenko said a court is set to consider a defense appeal on her request to ease conditions in custody. Eugenia Tymoshenko said on 10 Febru-ary that her mother wants permission to use a cell phone and to take walks out-side prison.

The EU has condemned the jailing of Tymoshenko as political and urged Yanukovych to free her.

Füle calls for dialogue in Ukraine

BELARUS|DIPLOMACY

UKRAINE|POLITICS

EU Enlargement Commissioner Stefan Füle addresses a press conference in Kiev, 13 February 2014. AFP PHOTO/YURY KIRNICHNY

30 EURASIA NEWEUROPEwww.neweurope.eu16 -22 February, 2014

A visit to the Czech Republic by the auto-cratic leader of Uzbekistan Islam Karimov has put the country’s president Milos Ze-man in the hot seat. Dozens of local and international human rights groups have called on Zemen not to receive Karimov on February 20. The groups are critical of Karimov’s documented use of torture in his country and the forced labour prac-tices in the cotton trade. In response to the criticism, the Czech government has in turn criticised the groups, accusing them of mis-information and "hypocrisy". According to officials, Zeman and Karimov will discuss a number of issues, including visa agreements and trade. According to media reports, Ze-man is eager to seal a deal worth up to $10m during Karimov’s visit.

According to Hynek Kmonicek, Zem-an's foreign-policy adviser, the Czech presi-dent is aware of Uzbekistan's human rights record and will probably use the visit to discuss the situation. "President Karimov is the president of Uzbekistan. Presidents speak to presidents. Simply, we must be able to speak to the people [even when] we would be of absolutely different approach [on certain issues]," Kmonicek says. "But how can you solve the question if you don't speak to the person? If you don't ask, you cannot get answers."

Kmonicek’s argument, however, has failed to convince the European rights community, especially Uzbek activists liv-ing in Europe. Mutabar Tadjibaeva, a rights activist who says he endured years of abuse

in the Uzbek prison system before seeking asylum in France, is one of several dozen Uzbeks planning to travel to Prague next week to protest Karimov’s visit.

"After the Andijon events, when the European Union demanded sanctions, the Czech Republic was among the countries to sign the agreement. And the Czech Re-public knows perfectly well that Uzbekistan didn't fulfill a single demand laid out in the

sanctions," Tadjibaeva says. "The fact that they're now looking at [Uzbekistan] as a partner is very surprising."

This is the third time that Karimov will be visiting the EU. He visited Latvia last year to discuss the military withdrawal from Afghanistan and Brussels in 2011 to meet with European Commission President Jose Manuel Barroso and NATO Secretary-General Anders Fogh Rasmussen.

Czech president to welcome Uzbekistan's Karimov, despite protests

TajikisTan|air PolluTion

More power to the people, less soot for the localIn January, Tajikistan’s President Imomali Rakhmon an-nounced that Dushanbe’s new Heating Power Plant (called Dushane-2) would operate clean and efficiently and make use of the latest filters to reduce emissions by a whopping 99.8%. What he failed to mention was that residents near the facilities should not hang their clothes out to dry. It has only been one month since the plant, which is located in the centre of town, was put into operation and already the local community is up in arms. One resident, 51-year-old Bibiradja Ochildieva, told EurasiaNet.org that it was like there had been a fire. “We had no idea about the consequences,” she said, stressing that she is concerned not only about the black stains on the clothes hung out to dry but about the health hazards. “They [the govern-ment] should have warned us. No one ever asked for our per-mission; we were just told it would be constructed here.” An-other resident, 48-year-old Dilbar Niyazova, told EurasiaNet.org that the facility is producing so much soot that she feels a need to sweep her backyard several times a day. She added that she feels misled by authorities: “My trust in the government is fading," Niyazova said. When plans for the construction of the plant were announced by the government, however, few ob-jected. They hoped it would finally put an end to the extended blackouts each winter. In fact, the plant was widely described as a sign of progress and a source of employment for hundreds of people. As regards the emissions and air pollution prob-lems, Mahmad Safarov, the director of the State Institute for Hydrometeorology, which is responsible for monitoring air pollution in the country, told EurasiaNet.org that the problem was due to a “one-time release,” adding that current emission levels meet Tajik health standards. “There was some techno-logical failure. It’s fixed now,” Safarov said.

kazakhsTan|CounTry ’s naMe

kazakhstan might change its nameKazakh President Nursultan Nazarbaev on February 6 an-nounced the possibility of changing the name of the country. He said: “Quite possibly we should consider a changeover of this country to the name Qazaq (Kazak) Eli or The State of Kazakhs (in English)". A name change will be decided by a public debate, the president added. The country’s current name means “the state” of Kazakhs, but in the Persian lan-guage. Kazakhstan’s 15.5m population is 63% Turkic-speak-ing ethnic Kazakhs. The rest is represented by dozens of eth-nicities, including ethnic Russians who represent 24% of the population.

kazakhsTan|Media FreedoM

Media freedom in kazakh stands trialThe future of Kazakhstan’s new independent weekly news-paper, Pravdivaya Gazeta (The Truthful Newspaper), will be decided by the courts. The owners of the weekly, which is critical of the government, have been charged with mislead-ing readers about their newspaper’s circulation and for failing to redress the complaints. These are the official charges. The owners of the newspaper, however, say the charges are politi-cally motivated and accuse the government of trying to silence them. Pravdivaya Gazeta was launched just nine month ago. It has already been suspended twice for three months and or-dered to pay two hefty fines. Last year, the European Parlia-ment adopted a resolution blasting the Kazakh government of failing to respect political, media, and religious freedoms.

The National Bank of Kazakhstan has de-cided (as of February 11) to stop backing the exchange rate of the tenge, the national currency - a move that devalued the cur-rency by 19%.

The bank’s decision also resulted in the immediate closure of currency-exchange points' dollar and euro trading and is driving many retailers out of business. Car dealers, for instance, were also quick to announce a temporary suspension of operations until the tenge's official rate is stabilises.

"The National Bank of the Republic of Kazakhstan has made a decision today

to stop, as of February 11, supporting the previous rate of the tenge, which yesterday, as you all remember, was 155.6 tenges [for $1]," Qairat Kelimbetov, the chairman of the National Bank of Kazakhstan, said on national Khabar TV. "In connection with this, we consider the proper rate of the tenge is the new exchange rate level, which is about 185 tenges for $1. I would like to repeat it again - 185 tenges for $1."

Kelimbetov also explained that the devaluation was necessary for industry to maintain operations. He assured that the country’s annual inflation rate will remain

at the current level of 6-8% and called on citizens to keep their savings in tenges.

But economists and consumers are worried that the prices of imported goods will increase and that this will spur a rise in inflation. Workers also fear that their sala-ries will not be recalculated based on the new rate and they will see their buying pow-er plummet. Even migrant workers from Kyrgyzstan, Uzbekistan, and Tajikistan are worried because they are paid in tenge, which they usually exchange for dollars, before sending money to families in their home country.

Kazakh’s national currency devalued

The United Nations special rapporteur on torture, Juan Mendez, is calling on Tajik to fully implement policies for the eradication and prevention of torture and ill-treatment. During his visit to Dushanbe on February 12, Mendez said Tajikistan still needs to

"bridge the gap between policies and real-ity" as regards the elimination of torture in the country.

Since the start of the year, at least two people have died under suspicious circumstances while in police custody.

Even though Mendez welcomed a re-cent "national action plan" approved by the Tajik government to end torture and ill-treatment, he was quick to stress that "civil society has not been consulted in the creation or execution of this plan".

UN: Tajikistan needs to eliminate tortureTajikisTan |huMan righTs

uzBekisTan |kariMov ’s visiT

kazakhsTan |CurrenCy devaluaTion

Thirty human rights groups on February 11, 2014 called on Czech President Milos Zeman to reconsider his plan to host his Uzbek counterpart Islam Karimov, accused of serious rights abuses, on a state visit next week. AFP PHOTO/MICHAL CIZEK

31RUSSIANEWEUROPEwww.neweurope.eu16 -22 February, 2014

Neft, the oil subsidiary of gas company Gazprom, intends to expand its filling sta-tion network in Bulgaria by 11 sites, local media reported. The 11 filling stations are currently owned by OMV Bulgaria, Bur-gas-based Bultrans Oil, and Plovdiv-based Lite Commerce, according to Bulgaria’s

Commission for Protection of Competi-tion (KZK).

Gazprom Neft is to acquire the new fill-ing stations through NIS Petrol, a subsidi-ary of Gazprom Neft’s Serbian unit Naftna Industrija Srbije. After the acquisition of the new filling stations, Gazprom Neft will

have a network of 35 sites and 12 terrains. Russian Gazprom Neft entered Bulgaria and the region in 2009 after it acquired the majority stake in Serbia’s state-owned NIS and made investments into the expansion of the production capacity of the oil refin-ery in Panchevo.

Gazprom Neft to acquire more filling stations in Bulgaria

RUSSIA|DIPLOMACY

Putin backs Egypt army chief ’s run for president Russian President Vladimir Putin has wished Egypt’s military chief victory in the nation’s presidential vote as Moscow sought to expand its military and other ties with a key US ally in the Middle East, AP reported. Putin said at the start of his meeting with Field Marshal Abdel-Fattah el-Sissi that he’s aware of his intention to seek the presidency. “I know that you have made a decision to run for president,” Putin said, according to Russian news reports. “That’s a very responsible decision: to undertake such a mission for the fate of the Egyptian people. On my own part, and on behalf of the Russian people I wish you success.” Russia’s Foreign Minister Sergey Lavrov said after meeting with his Egyptian counterpart Nabil Fahmy that Russia and Egypt agreed to “speed up the preparation of documents that would give an additional impulse to our military and military-techni-cal co-operation”. Russia’s Defense Minister Sergei Shoigu, who met separately with el-Sissi, said that the need to strengthen military co-operation between Russia and Egypt stems from “common challenges and threats,” but mainly terrorism. Shoigu said he and el-Sissi discussed possibilities for joint military ex-ercises and training Egyptian officers in Russian military acad-emies. “We also discussed the ways of expanding co-operation between our air forces and navies,” Shoigu said. Neither Lavrov nor Shoigu mentioned any specifics related to weapons sales, but Russian media reported last fall that Egypt was interested in acquiring Russian air defense missiles, MiG-29 fighter jets, helicopters and other weapons. The visit comes nearly three months after Lavrov and Shoigu visited Cairo, the fact that Fahmy said reflects both countries’ interest in expanding their co-operation. “Naturally, we discussed bilateral relations and there is an interest in developing economic ties through a bi-lateral committee next month that will have specific proposals working toward the interest of both nations,” Fahmy said.

RUSSIA|DEFENCE

Russia supplies military helicopters to India

Russia has delivered the first batch of 19 military transport heli-copters Mi-17B-5 to India, as part of the contract to supply 59 helicopters of this type, an official representative of the Russian delegation at Singapore Airshow 2014 said, news agencies re-ported. The remaining 40 helicopters will be supplied to India by the end of 2015. The contract was signed during Russian President Vladimir Putin’s visit to India in December 2012. The contractor is the Kazan Helicopter Plant, which is integrat-ed in the Russian Helicopters holding. In late 2013, KVZ ex-ecuted the previous large helicopter contract with India signed in 2008, under which it supplied 80 MK-17B-5.

By Kostis Geropoulos

Despite what Russian President Vladimir Putin has called “Cold War” mentality in the West, resulting in “unfair criticism” of the 2014 Winter Olympics before their opening, the Sochi Olympics have progressed relatively smoothly, with me-dia attention now turning to the athletes and the events. But the future use of the Black Sea resort remains uncertain.

Russia is not likely to turn Sochi into a gambling resort for high-rollers after the country’s first-ever post-Soviet Olympic Games, to offset losses ex-pected to be made by businesses that invested in the development of the Black Sea resort. Russian President Vladimir Putin said on 10 February that he was against the gambling-zone idea because the Black Sea city would then lose its tra-ditional holiday-makers – middle-class families with children.

Alexei Devyatov, chief economist at UralSib Financial Corp in Moscow, told New Europe on 14 February that in Rus-sia “if the president says ‘I don’t like it,’ it’s not going to happen. So they will try to operate it as a resort and try to attract people from Russia and maybe outside but the profitability of this project is un-der question”.

Putin acknowledged that Sochi would have to come up with its own funds to at-tract tourists after the Olympics, urging lo-cals to opt for a family friendly resort rather than a gambling hub.

“For all the love for Sochi, it now must be developed through very differ-ent means,” Putin said at a meeting with Sochi citizens’ representatives. “Addi-tional investment can’t really be expect-ed after the enormous resources invested here.”

In December, the Kommersant newspaper reported that the proposal to create a gambling resort had been voiced by Russian Prime Minister Dmitry Med-vedev. “The gambling zone was a sug-gestion by some people who were con-cerned about profitability and some of these were investors in Olympic projects but they had not heard from the presi-dent at this point,” Devyatov said.

On 10 February, Putin reminded that Russia already has a gambling zone on the border between the Rostov Re-gion and the Krasnodar Territory. “We even allowed them to access the Black Sea coast. In my opinion, it would be impractical to set up another zone in the region, although it would certainly make things better for investors Putin said.

The Kremlin banned gambling in

Russia in 2009, except for four desig-nated zones across the country. These zones are located in the Baltic exclave of Kaliningrad, the country’s Far East, the southern Krasnodar territory and Sibe-ria’s Altai region.

Putin said that turning Sochi into a gambling zone “would create an atmos-phere that would prevent our citizens from spending their holiday here with their families”.

The cost of the Sochi Winter Olym-pic Games exceeded $50 billion, making them most expensive Olympics of all time. Putin said the money was invested to make Sochi attractive for middle-class tourists, not for a small group of rich visi-tors “who can afford losing hundreds of thousands of dollars in a casino”.

The Russian President said the pri-ority for the coming years would be to make the most of the infrastructure built for the Olympics. “We should put into operation everything that had been cre-ated and ensure that it works efficiently,” Putin said.

Sochi at the foot of the Caucasus Mountains, a vacation retreat favored by Joseph Stalin, is hosting Russia’s first Winter Olympics, which opened on 7 February. The Closing ceremony is on 23 February.

Putin: Sochi for families, not high-rollers

RUSSIA|ENERGY

RUSSIA|TOURISM

Members of a marching band perform in front of the Olympic Rings in the Olympic Park during the Sochi Winter Olympics, 13 February 2014 .AFP PHOTO/LOIC VENANCE

A Russian military helicopter MI-28H at the MAKS 2011 airshow, Zhukovsky, Russia, 18 August 2011. EPA/SERGEI ILNITSKY

KASSANDRA32

Kassandra@NEurope.eu

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The UK has often been con-sidered 'enemy territory' by many in Brussels for some

time, so it was with a mixture of ad-miration and trepidation that Brus-sels watched VP Viviane Reding head to London to discuss the virtues of the European Union and the many and varied benefits that membership provides.

While she was speaking at an event in Mayfair, an exclusive area of the city and highly sought after square

in the board game Monopoly, thieves broke into her official car, which was unlocked and made off with Reding's pie and valuables.

A box of EU papers was left un-touched by the thieves.

Reding said she bought the pie at a farmers market in London, tell-ing reporters, “I got it to show people how good British cooking is. I just hope that at least they eat it and don’t throw it away.”

“It will be really difficult to re-

place the clothes, jewellery and make up," said the Commissioner, adding, "My earrings have been on pictures worldwide. They might not be valu-able but they are original and recog-nisable. The person who wears them should be aware of that."

Reding said it was the first time she had her bag stolen, but she said, "They left my papers fortunately."

She offered no explanation for the thieves lack of interest in EU documents.

16 -22 February, 2014Once Upon A Time In Italy...A week is a long time in politics they say. In Italy, it's a full term in office

Reding's pie pinched

If seen, please return to Berlaymont BEn DALTon

Justice Commissioner has pie, valuables stolen from official car in London

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Courting influenceAustria has nominated oskar Herics to the EU Court of Audi-tors, raising him from his posi-tion as chief of Section 5 of the Austrian auditors in Vienna.He will be examined by MEPS in the Budgetary Control commit-tee on Monday 17 February.The selection of Herics has taken some time, but the choice is said to be more about a close asso-ciation with Vice-Chancellor Spindelegger than experience or qualifications.objections were raised on this very point by Andreas Karlsbock (FPo) and Bruno Rossmann (Green). They also complained about missing information about the nominees and said the choice had not been made in a transpar-ent manner.national Council President Bar-bara Prammer (SPo) agreed that it was legitimate right to have in-formation on the applicants and said this had not happened and even mentioned the possibility of a change to the law to prevent a re-occurrence.Spindelegger, head of the Aus-trian People’s Party (oVP) is said to be plotting to become a member of the next Commission in Brussels.

The VP’s wife, Magrit Spindel-egger, is at the European Court of Auditors, but unusually is ‘on loan’ to the Austrian auditors until the end of the year. It is reported that there is consider-able resentment to her receiving an ‘EU’ salary for a ‘national’ job. Prior to this, she was at the Euro-pean Commission.There is much speculation that she may well become Herics’ head of Cabinet.Many believe this is too much concentration of power and could harm the reputation of the European auditors.Herics, with Madam Spindeleg-ger at his right hand, could end up investigating her husband, in his governmental roles and du-ties, or more worryingly as a Eu-ropean Commissioner.This is beginning to look like nepotism to those questioning the events.It is to be hoped that MEPs will be more rigorous than their na-tional colleagues were, who were not provided with the informa-tion they should have been, but there should also be an exami-nation into, a potential conflict of interest, but into the circum-stances surrounding Ms Spinde-legger’s curious career path.

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