Increasing doubts about aid to corrupted Kenya

Development and emergency aid continues to pour into Kenya. There are without doubt many needy people in Kenya, who could use the aid, but donor countries and organizations are finally beginning to ask, whether their efforts are worthwile. Faced with the facts in this one of the world´s most corrupted countries, it is not difficult to understand the growing doubts:

‘The permanent secretary in Kenya’s finance ministry estimated last November that he lost a third of his budget – $2bn – to graft’.”

The Kenyan daily The Nation writes about a growing corruption scandal:

A scandal similar to one that led to donor freeze of Free Primary Education funding has emerged in the programme to save communities from the effects of drought.

Billions of shillings committed by various donors and international lending institutions for fighting drought in Northern Kenya are frozen as the country begins to confront suspension by the World Bank of a critical drought management project that has been running since 1996, and which is currently under the ministry for the Development of Northern Kenya and Other Arid Lands. It is financed by the government and a World Bank loan.

The forensic audit exposed massive corruption and fraudulent transactions across seven districts of Northern Kenya.

From transactions picked at random from the seven districts, the audit established fraudulent transactions amounting to Sh362 million in two financial years.

The forensic audit catalogues cases where money was spent on dispensaries that were not in use, butcheries that were not certified by Health ministry and schools that did not exist.

Read the entire article here

A tiny example of the sad reality in Kenya:

Officials of Mawingu IDP camp in Nyandarua Central district were allegedly intercepted on Sunday night as they ferried 91 bags of relief maize. IDPs who spoke to the press said they have been suspecting that the officials have been selling the food aid. The IDPs said they laid a trap and nabbed a lorry with grains, at 2am They smashed the lorry's windscreens and windows.

The World Bank has now finally reacted to the corruption in Kenya:

Nairobi - The World Bank did not renew funding for a project to help more than 1 million Kenyans to withstand recurrent droughts after some of the money could not be accounted for, an official said on Friday.

Johannes Zutt, the World Bank country director, said the group chose not to give new funding to the Kenyan government for the Arid Lands Natural Resource Management Program until it accounts for $4.1 million that was used.

The unaccounted money was part of $120 million the bank gave to the project from 2003 to 2010. The Kenyan government says it is looking into the fraud allegations.

Critics say mismanagement and endemic corruption in Kenya's government are partly to blame for the hunger situation in Kenya where the UN anticipates that 3.5 million people will need food assistance in coming months.

Kenya, East Africa's largest economy is one of the most corrupt countries in the world according to anti-corruption watchdog Transparency International which ranks the country at 154 of 178.

Read the entire article here

In spite of the widespread corruption (In the 2010 Corruption Perception Index published by Transparency International, Kenya was number 154 out of 178 countries surveyed) the steady flow of aid to Kenya continues:

The government of Finland has donated 643 million shillings to the Kenyan government in an effort to promote efforts aimed at attaining Millennium Development Goals in the country.

German chancellor Angela Merkel recently visited Kenya, and promised more aid - although she also spoke about fighting corruption. Whether there will be any actual improvements in the near future, is highly doubtful:

Visiting German Chancellor Angela Merkel on Tuesday pledged increased development aid and stronger trade ties with Kenya on her first visit to the country.

Merkel said the strong business delegation accompanying her underscored the desire to deepen economic ties, but stressed the success of the bilateral support is pegged on transparency and the effective fight against corruption.

She praised progress in implementing the Constitution and promised Germany’s support in setting up credible institutions to fight corruption and organise next year’s General Election.

PS

There is, of course, the question whether development aid to Africa - even under the best kind of circumstances - in reality does more harm than good. But even those who still believe in the usefulness of foreign aid, should abstain from giving to corrupted regimes and countries. It is also worth noting that the likelihood of corruption increases with more and more of e.g. EU aid going to fighting (imaginary) human caused global warming/climate change.

The repercussions of an economic slowdown in China

The Taiwanese know China better than most other people. That is why it is worth reading what Wu Hui-lin, a researcher at the Chung-hua Institution for Economic Research, has to say about the deteriorating trend for China´s small and medium-sized companies, which contribute about 60% to China´s GNP and 80% of urban employment:

It is a well-known fact that China’s economy is going through great structural changes. Small and medium-sized enterprises (SMEs), which make up more than 99 percent of all Chinese companies, require a healthy operating environment and such an environment normally includes free entry to the market, fair competition, a mature and reasonable financial order, a sound legal system, transparent regulations and controls, as well as effective execution. However, for some time now the Chinese operating environment has placed major restrictions on the development of SMEs. In particular, these companies have been treated differently when it comes to financial assistance.

The interest rates on 62.3 percent of loans to SMEs are higher than the benchmark interest rate, while only 27.2 percent of large enterprises are subject to a higher rate. In addition, large enterprises receive more preferential loans. SMEs also tend to have less sound credit, which makes it difficult for them to obtain loans. Now that China is tightening access to credit, SMEs tend to be the first to have their loans put on hold by banks, compounding their already difficult situation.
---
Judging from the situation in China, the manufacturing industry is clearly deteriorating. While it is true that this sector has been affected by the continued appreciation of the yuan, rising raw material prices, rising labor costs and the international financial crisis, the factor that has most directly undermined the manufacturing and -processing industries is the difficulty accessing capital as a result of financial controls and tightening credit.

On April 30, an article in the Chinese magazine Economic Review revealed that many Chinese SMEs are experiencing problems.

Rising costs have led to declining profits and many businesses facing a situation where stopping production will cause them to close, while continued production will lead to an even faster demise. Needless to say, a wave of SMEs are having to close.
One entrepreneur said that the biggest problems for Chinese SMEs is that: “Regardless of whether they are selling to the domestic market or for export, there is a clear shortage of orders and it is very common to see factories running at half capacity and making a loss. Even if they run at full capacity, they will not make any profits to speak of and everyone is doing all they can just to hold on.”
---
Last year, there were more than 10 million registered SMEs in China and the final value of their products and services was equal to about 60 percent of the GDP. They provided 80 percent of urban employment and their tax payments made up 50 percent of all tax revenue. SMEs are clearly vital to China’s economic and social stability, and the current wave of closures will undoubtedly have an impact on the nation.
Now there is increasing talk of the Chinese economy’s possible collapse. Not long ago, “Dr Doom” himself, renowned economist Nouriel Roubini, included China’s demise as one of four factors in a perfect storm. Even those who used to have a bullish outlook are now changing their tune.

Read the entire Taipei Times article here

There are, of course, a number of other factors contributing to the risk of a serious slowdown in China, such as e.g. inflation and the looming real estate bubble.

The slowdown of the Chinese economy will without doubt have major repercussions in other countries as well. From a European point of view, Germany is the country that is going to be hardest hit, considering the importance of China in the German export success of recent years:

China is now Germany´s most important non-European export destination. As the Economist recently pointed out, German firms "happen to produce exactly the things that a booking China wants, from luxury cars to the machinery that enable Chinese factories to be the workshops of the world". Mercedes and BMW e.g. make 40% of their profits in China.

There are already signs of cooling in the German economy:

German investor confidence dropped for a fifth month in July, executives grew less optimistic and manufacturing growth slowed. German consumer confidence will drop for a fifth month in August, a survey by the GfK SE (GFK) market-research company showed on July 26.

Add the euro crisis and the financial turmoil in the US and you have the ingredients of a "perfect storm".

The US and China will not accept EU climate charges for their airlines

                                          American Airlines B777 landing in Heathrow - without unlawful EU ETS charges

The European Union´s unlawful and stupid attempt to impose its own Emission Trading System (ETS) on non-EU airlines is going to fail. There is no way the EU can win the fight against  the US and China, both of which strongly oppose the new regulation:

Does Europe really want to dictate an idea for climate protection to the rest of the world? That's the question being asked by US leaders in Washington, who are throwing their support behind a protest by the American airline industry against an EU climate rule.

The new regulation comes into force in January 2012 and requires airlines to buy certificates for carbon emissions to take off or land at European Union airports. The EU will sell the certificates and allow them to be re-sold. It's a way of bringing the airline industry under the EU's emissions-trading scheme, the European Union Emissions Trading System (EU ETS), which has applied to European industry since 2005.

But the Americans don't like it. In fact, the Obama administration is protesting the plan with enough vigor to risk a massive trade dispute. "The European Union is imposing this on U.S. carriers without our agreement," said Wendell Albright, director of the Office of Aviation Negotiations at the State Department, to the New York Times this week. "It is for the U.S. to decide on targets or appropriate action for U.S. airlines with respect to greenhouse gas emissions."

This rift has been growing for months, meanwhile congress is working up defensive measures. Lawmakers in the House of Representatives are forging a bill to forbid any American airline from taking part in the EU ETS. Airlines in the country have also taken action against the rule before the European Court of Justice.
Nancy Young, vice president for environmental affairs at the Air Transport Association, an airline industry group, says the EU is "attempting to regulate the airlines of the world," according to the New York Times. "The plan violates international law."
The airlines estimate that participating in the EU ETS would cost $3.1 billion through 2020. China has also protested the new rules, and it has reportedly blocked an order worth billions to the European aerospace company Airbus.
The EU, nevertheless, intends to stick to the new plan. Connie Hedegaard, a European Commission member in charge of climate action, says it would be unfair to demand emissions certificates only from European airlines while big foreign firms like United Airlines or Air China fly the same routes for free.

Read the entire Der Spiegel article here

PS

Connie Hedegaard, quite rightly thinks that "it is unfair to demand emission certificates only from European airlines". The anwer is quite simple: Remove the useless certificates also for European airlines! It´s just as simple as that.

Finland and Russia to modernise their icebreaker fleets - not trusting global warming predictions

Flashback: The Baltic Sea last winter:

"More than 60 vessels stuck in ice in Gulf of Finland"

"The Baltic Sea currently has the most extensive ice cover that it has seen in 24 years. On Thursday, 310,000 square kilometres of the sea were covered in ice, and the area is growing.
After the severe winter of 1987, the ice cover in the Baltic was nearly 400,000 square kilometres wide, which in practical terms means that the entire surface of the Baltic was effectively covered in ice. The entire sea has been completely frozen over just 20 times since 1720."

The global warming alarmists do not seem to have convinced the Finnish and Russian governments about ever warming winters:

Finland´s new government has decided to modernise its icebreaker fleet:

The programme of the new government contains a pledge to undertake replacement of outdated icebreakers. One matter under consideration is who will own the vessels. The present fleet is owned by Arctia Shipping, a state-owned company.

Finland has five traditional-type icebreakers and three multi-purpose icebreakers. The oldest is the Voima that has been in service since 1954. The most powerful icebreakers, the Urho and Sisu have been in service for 35 years and the most recent traditional icebreaker has seen 25 years of service.
The three multi-purpose icebreakers were constructed in the 1990s.
According to Ilmari Aro, an expert on winter shipping at the Transport Ministry, the Voima is to be replaced during the term of the present government. Arctia Shipping's CEO Vauraste says that the rest of the fleet is to be replaced by around 2020. The lifetime of the vessels can be extended with investment in repairs and maintenance.
A new traditional icebreaker carries a price tag of around 100 million euros. Multi-purpose icebreakers are a bit more expensive.
Icebreakers and their services are important because of Finland's heavy reliance on maritime shipping for exports and imports. Estonia and Finland are the only countries in the world where all of the nation's ports freeze over in the winter

Read the entire article here

Neither is the Russian government trusting the warmists´ predictions:

“A very important decision was made in connection with the situation in the Gulf of Finland this winter, to build icebreakers. Currently all the fleet used to escort ships in the ice, except for two icebreakers, is obsolete. The new icebreakers to be ordered should be built to optimized projects”, stated A.Davydenko.

Read the entire article here

PS

Both governments are, of course, basing their decisions to modernise the ice breaker fleets on the realities of the northern winter - not the climate scientists´ computers models. One must hope that the Finnish and Russian - as well as other - governments perform the same reality checks with regard to other areas involved in the global warming scam, too.

Australia intends to finance communist Cuba´s international propaganda campaign

Merles: "I also think it's important for them (Communist Cuba) in terms of building their international profile"

Radio Australia is telling us about the Australian government´s intention to finance communist Cuba´s medical propaganda campaign in the Pacific.

Before going on to that part of the story, here is some useful background information:

Nothing has changed since Raúl Castro took over after his brother Fidel in Cuba, Human Rights Watch reports:

Raúl Castro has kept Cuba’s repressive machinery firmly in place and fully active since being handed power by his brother Fidel Castro. Scores of political prisoners arrested under Fidel continue to languish in prison, and Raúl has used draconian laws and sham trials to incarcerate scores more who have dared to exercise their fundamental rights. In particular, the Raúl Castro government has relied on a "dangerousness" provision in the Criminal Code that allows authorities to imprison individuals before they have committed a crime, on the suspicion that they might to commit an offense in the future.

This is HRW´s most recent human rights story from Cuba:

The conviction of six dissidents in summary trials for doing no more than exercising their fundamental rights highlights the continuing abuse of the criminal justice system to repress dissent in Cuba. Raúl Castro's government should immediately release the prisoners, who were given sentences ranging from two to five years in prison, and cease all politically motivated repression against Cubans who exercise their fundamental freedoms.

The story often repeated by western mainstream media about the "unselfish" Cuban "doctor diplomacy" is in real life somewhat different:

But in 2003, Castro went big, and shipped 20,000 doctors and nurses to Venezuela's jungles and slums to treat the poor, doing the work "selfish" private-sector doctors wouldn't. Hugo Chavez touted this line and the mainstream media followed.

Now the ugly facts are getting out about what that really meant: indentured servitude to pay off the debts of a bankrupt regime.
This week, seven escaped doctors and a nurse filed a 139-page complaint in Miami under the RICO and Alien Tort acts describing just how Cuba's oil-for-doctors deal came to mean slavery.

The Cuban medics were forced to work seven days a week, under 60-patient daily quotas, in crime-riddled places with no freedom of movement. Cuban military guards known as "Committees of Health" acted as slave catchers to ensure they didn't flee.

Doctors earned about $180 a month, a salary so low many had to beg for food and water from Venezuelans until they could escape.

What they endured wasn't just bad conditions common inside Cuba. The doctors were instruments of a money-making racket to benefit the very Castro regime that has ruined Cuba's economy.

"They were told 'your work is more important to Cuba than even its sugar industry,'" their attorney, Leonardo Canton, told IBD.

That's because their labor was tied to an exchange: Castro took 100,000 barrels of oil each day from Venezuela's state oil company in exchange for uncompensated Cuban labor.

Most of the oil was then sold for hard currency, bringing in cash. Cuba also charged Venezuela $30 per patient visit, meaning a $1,000 daily haul per doctor. But the doctors never saw any of it.

Read the entire article here

Neither is the medical care in Cuba as excellent as many western media picture it. Leaked US diplomatic cables tell another story:

A Cuban woman in her thirties confides, “It’s all about who you know. I’m okay because I am healthy and I have ‘friends’ in the medical field. If I didn’t have my connections, and most Cubans do not, it would be horrible.” She relates that Cubans are increasingly dissatisfied with their medical care. In addition to the general lack of supplies and medicines, and because so many doctors have been sent abroad, the neighborhood family physicians now care for 300-400 families and are overwhelmed by the workload. (Note: Neighborhood doctors are supposed to provide care for only 120 families. End Note.) In the absence of the physicians, patients go to their municipality’s “polyclinic,” but long lines before dawn are common, with an all too common 30-second diagnosis of “it’s a virus.”

---

Few medical professionals are allowed access to the internet and are rarely allowed to travel to participate in international conferences or continuing education courses. Access to up-to-date medical literature is not available. Some physicians have confided to the FSHP, “All of us want to leave.” They are dissatisfied with their salaries and their own medical care. They receive no special privileges – most of them do not even have access to care at the better foreigner hospitals, even if they work there.

---

As described in reftel, the best medical institutions in Cuba are reserved for foreigners with hard currency, members of the ruling elite and high-ranking military personnel. These institutions, with their intended patient clientele in parentheses, include: Clinica Central Cira Garcia (diplomats & tourists), Centro Internacional de Investigaciones Restauracion Neurologica (foreigners & military elite), Centro de Investigaciones Medico Quirurgicas (military & regime elite), Clinica de Kohly (Primer Buro Politico & Generals of the Ministry of Interior), and the top floors of the Hermanos Ameijeiras Hospital (foreigners) and Frank Pais Hospital (foreigners). These institutions are hygienically qualified, and have a wide array of diagnostic equipment with a full complement of laboratories, well-stocked pharmacies, and private patient suites with cable television and bathrooms

Read the entire article here

Keeping the above mentioned facts in mind, we now read about the intention of the Australian government to finance Cuba´s international medical propaganda efforts:

Australia is looking to work more closely with Cuba in delivering development aid to the Pacific.
Australia's Parliamentary Secretary for Pacific Island Affairs, Richard Marles, visited Cuba last week to hold talks about linking up the countries health assistance programs in the Pacific.

MARLES: Look we think we've taken the next step forward in doing that. It was a really success to Cuba and Cuba is obviously a fascinating country, but a fascinating player in the development assistance world and it's very renowned in terms of with health. There are ten-of-thousands literally of Cuban doctors around the developing world doing very good work and that includes working in the Pacific and I think they've developed a particular expertise in delivering health care and assistance in developing world settings and we're keen to see how we can, if you like, leverage their expertise against our presence in the Pacific to do something really important. So what we've agreed is we will both participate in a scoping study of Cuban experts and Australian experts hopefully later this year to look at ways in which we can do exactly that and see whether we can ultimately have an agreement about doing that. And I should also say we've taken the first tentative step in relation is actually in Haiti and this occurred prior to my visit, but we do provide some assistance to the provision of Cuban medical assistance in Haiti, after, of course, the tragic earthquake there.

COUTTS: Now you talked about scoping of experts. Is this strictly in health at this stage?

MARLES: Yes, it is. Health is in a sense what the Cubans are most renown for and it does represent the development assistance that they're providing in the Pacific at the moment. So that is what we are looking at seeing how we can work with them to do more in relation to that.
COUTTS: Now health is of course really important and we know that Cuba has many, many universities dedicated to turning out doctors, alone a speciality there. For a small country and a small economy, what's the thinking, why are they doing that?

MARLES: I think that's a really good question and it's one I asked a number of people, including the foreign minister and we also visited a place called the Latin American School of Medicine, which despite its name is actually providing medical training to people from all over the world, including some 160 odd students from the Pacific. So they are drawing people from the developing world to Cuba and giving them medical training and for a full six year course and at the end of it, people go back as trained doctors. I think in answer to your question they see that health care is an important, well it's probably the key social indicator. It's something that they have focused on very heavily within their own country. I think in the process of doing that they have developed a particular expertise around how to develop a health care system in a developing setting and in a setting where there isn't a lot of money going around and this is now something that they feel they can share with the rest of the world and somebody said to me it's kind of in the Cuba DNA now to provide healthcare assistance to as many countries as possible and that's what they're doing.
COUTTS: What's in it for them, who funds all of this?

MARLES: Well, the Cuban government fund it and I mean a good question again, what's in for them. Well, I think they're engaging in developing assistance for the same reasons that we are, that they're in the sense of this is the right thing to do in terms of helping the developing world. I also think it's important for them in terms of building their international profile.

Read the entire article here

The naivety of the Australian Parliamentary Secretary is astounding. Does he not understand that what he actually is proposing, is to use Australian tax payers´ money to finance communist Cuba´s international propaganda efforts? If he really wants to give medical aid to Pacific countries, why not send Australian doctors and nurses to do the job, or educate young people from these countries to become doctors in Australian medical schools?

All-time record harvest in India may lead to riots

As we have reported earlier, India has been blessed with an all time record grain harvest this year - contrary to all "forecasts" by the global warming alarmist community. However, it appears that celebrating this major agricultural breaktrough is somewhat premature:

Less than a week after India announced a record harvest, Hindustan Times has learnt that the nation’s main grain-buying agency is running out of money for its massive nationwide purchase operation. Over the last month, the state-run Food Corporation of India (FCI) has twice stopped payments to state governments, various grain-purchasing agencies and rice millers who buy wheat and rice, the main food crops, from millions of farmers, a senior government source told HT on condition of anonymity.

"If this financial crisis continues, FCI and state agencies funded by it will not be able to procure grain. There is no money for August and September,” said the source. “This is a serious situation, and it is being brought to the notice of the finance minister."

Read the entire article here

Indian Equitymaster has more on this story:

Currently around 99% of the grain produced in India is bought by FCI (Food Corporation of India). And this is entirely funded by the government's subsidies as FCI has no alternate source of income. At the same time, FCI has to buy the grains from the farmers because it cannot legally refuse them.

So what would happen now? FCI has requested the government for Rs 380 bn in addition to the Rs 472 bn it received from this year's annual budget. If the government does not agree to this or delays the payment, the country would face serious problems. These would be in the form of huge protests and unrest from the farmers who would not get paid for their grain. And even worse, if no one buys the grain then it would just be left out in the open to rot and waste away.

Read the entire article here

It would be very sad, indeed, if the all-time record harvest in India would lead to serious unrest and waste of the much needed grain. There is, however, a possibility to avoid a crisis: The European Union could divert a tiny percentage of its huge climate change aid to "mitigate" the storage and distribution problems in India. An initiative from the EU´s chief climate change alarmist Connie Hedegaard would be a pleasant surprise. (Of course, it will never come)

Whatever happens, one thing is almost certain; soon we will hear from some "official" IPCC climate scientist, that the record harvest actually is fully consistent with global warming predictions, and that it in reality only will contribute to an even more catastrophic future harvest reduction.

Republicans ready to stop US climate change funding to IPCC and the World Bank

Great news from the US Congress: GOP is planning to put an end to funding the IPCC and World Bank-led programs:

GOP spending legislation for the State Department and foreign operations announced Tuesday would end U.S. contributions to multilateral funds designed to help poor nations battle climate change.

The fiscal year 2012 bill, which House Appropriations Committee lawmakers will begin considering Wednesday, eliminates funding for the Clean Technology Fund and the Strategic Climate Fund, rebuffing the White House request for a combined $590 million for the World Bank-led programs.

Current U.S. spending for the programs is $375 million.

The bill also bars U.S. funding for the United Nations’s Intergovernmental Panel on Climate Change, which produces closely watched multiyear assessments of global warming.

Nor does it allow funding for the U.N.’s Framework Convention on Climate Change, the international forum for efforts to craft a global emissions treaty.

Read the entire article here

One must hope that the Repbublicans will prevail on this. A decision to bar the IPCC funding would be particluarly welcome and necessary. The decisions to cut the climate aid would also set an example for other countries to follow.

Frank Furedi on the euro crisis: The end of an era

 "From its inception, the EU was an elitist managerial project that was able to construct and promote its agenda without having to directly respond to popular pressure"

Professor Frank Furedi of the University of Kent is one of my favourite academics. In one of his latest articles, dealing with the failure of the EU leaders to adequately address the crisis of the euro, Furedi gives an excellent description of the reality of the European Union:

The rhetoric of responsibility aversion among policy-makers in the EU is underpinned by the realisation that their institution lacks the authority and the political resources to deal with the current crisis. It is important to remember that the EU is a technocratic institution that has always responded to new challenges through cobbling together behind-the-door deals. From its inception, the EU was an elitist managerial project that was able to construct and promote its agenda without having to directly respond to popular pressure. Decisions are never arrived at through public debate, and the majority of EU laws are formulated by the hundreds of secret working groups set up by the Council of the EU. Most of the sessions of the Council of Ministers are held behind closed doors and the EU’s unelected European Commission has the sole right to put forward legislation.
The most distinct feature of the EU’s governance is that it is systematically pursued through the principle of insulated decision-making. For decades the EU political establishment has self-consciously constructed institutions that could insulate them from the necessity of having to respond directly to the type of public pressure faced by a democratic parliament. The EU’s invisible decision-making allowed a variety of political actors in Brussels and in the national capitals to avoid taking responsibility for unpopular decisions. In effect, policy-makers were insulated from having to account for the consequences of their decisions.

Furedi is not optimistic about the ability of the present EU leaders to solve the current problems:

Political leadership is not simply a desirable option. Without winning over a significant section of the European electorate it will prove extremely difficult to restore financial order in Europe. Regrettably, the EU establishment lacks the capacity to offer such leadership. Policy-makers who are used to behind-the-scenes manoeuvring are rarely able to re-invent themselves as persuasive leaders.

The future for the euro, and indeed the EU in its present form, does not look rosy:

I have visited Brussels regularly during the past five years, but this was the first time that my interlocutors appeared to signal their fear that the euro crisis was more than a financial one. It represented the end of an era.

Read the entire article here

Global warming alarmist Richard Branson´s selective "activism"

 "Necker Island, Sir Richard Branson’s private paradise, is
situated in the British Virgin Islands, a stunning and unspoilt
area of the Caribbean. At 74 acres, the island sits in
turquoise waters surrounded by coral reefs and fringed with
beautiful white sandy beaches."


The British billionaire and global warming "activist" Richard Branson, known among other things for his co-operation with Al Gore, describes why his exclusive private Caribbean island is such a wonderful place:

I know I shouldn’t, but I still like to party on Friday nights. I live half the year on Necker, a tiny island in the Caribbean and it’s always full of people in party mode. Everyone comes up to the big house and we’ll be dancing until the early hours to the island’s band, the Front Line.--
You always see the best side of people on Necker. I suppose that being surrounded by such beauty inspires people. We’ve had Nelson Mandela, Archbishop Tutu, President Carter, Kofi Annan and Mary Robinson staying on the island to brainstorm about ways to tackle conflict and global warming, with cormorants flying past on one side and flamingos on the other. Quite a few non-profit organisations have been conceived there such as The Elders and the Carbon War Room.

Read the entire article here

It is not difficult to understand why people like Kofi Annan, Mary Robinson and Jimmy Carter (probably also Al Gore) have wined an dined on Necker island as honoured guests of the British business tycoon. "Tackling climate change" in that environment must be a rather pleasant experience - if you do not worry about the huge carbon footprint getting there creates. And, of course, over the years, it has become a tradition that politicians and other celebrities accept exotic vacations paid for by oligarchs and business tycoons. Harrison Ford and Peter Gabriel are among  another "activists", who are known to have vacationed on Branson´s paradise island.

But what about Richard Branson´s own climate change "activism"?

It is interesting to note that Sir Richard, owner of Virgin Atlantic airlines, opposes the UK Air Passenger Duty, which is supposed to cut carbon dioxide emission, and the also is against the carbon dioxide cap and trade system for airlines in the European Union. Thus, when it comes to his own business interests,  this "activist" does not anymore seem to be "in the forefront of a growing number of businessmen campaigning to stop it (global warming) running out of control."

Richard Branson may be rich and succesful, but he is also a hypocrite - quite like Al Gore.

PS

It is, of course, possible also for us "ordinary people" to share the same experience as Kofi, Jimmy and Mary. But it ain´t cheap. Here is the latest price information, in case you are seriousle interested:

ARRIVALS FROM 1ST JANUARY 2012
From US $56,000 per night for up to 28 guests
($2,000 per person per night)

Necker Island web page

The shale gas revolution could lead to the end of the Putin era

A new American study confirms, what this blog has brought up in  previous posts, e.g. here and here; the Russian grip on European energy is faltering as a consequence of the American led shale gas revolution:

The natural gas boom in the U.S. has weakened Russia’s influence on European energy supplies and could keep Iran’s influence in check for years to come, according to a new study from the Baker Institute for Public Policy at Rice University.
The study, “Shale Gas and U.S. National Security,” says the surge of drilling in shale formations will have an impact on global supply for years to come and limit the need for the U.S. to import liquefied natural gas, or LNG, for at least 20 to 30 years.
That means more LNG shipments from the Middle East will be available for Europe, which has been beholden to Russia for a large portion of its gas, supplied by pipelines.
The study, funded by the U.S. Department of Energy, predicts that Russia’s share of the natural-gas market in Western Europe will drop to as little as 13 percent by 2040, down from 27 percent in 2009.
“By increasing alternative supplies to Europe in the form of liquefied natural gas (LNG) displaced from the U.S. market, the petro-power of Russia, Venezuela and Iran is faltering on the back of plentiful American natural gas supply,” writes Amy Myers Jaffe, a fellow at the Baker Institute and one of the authors of the study.
The study challenges the notion that the U.S. natural gas shale is a short-lived phenomenon. It concludes domestic production will more than quadruple by 2040, from 2010 levels, and account for more than half of all U.S. gas production by the 2030s.

‘Game changing’
“The idea that shale gas is a flash-in-the-pan is simply incorrect,” writes Kenneth Medlock III, another Baker Institute fellow and study co-author. “The geologic data on the shale resource is hard science and the innovations that have occurred in the field to make this resource accessible are nothing short of game changing.”
A decade ago, U.S. companies were making massive investments to build LNG-import terminals based on the assumption that domestic natural-gas production would continue to decline and the country would need to draw on supplies from Africa, Russia, the Middle East and Australia.
But U.S. supplies did a U-turn over the past five years as companies perfected the combination of horizontal drilling and hydraulic fracturing — a process of injection millions of gallons of water, sand and chemicals into the ground to crack open shale formations – to economically access more gas reserves.
LNG terminals
U.S. gas production from shale has risen from virtually nothing in 2000 to more than 20 percent of domestic production today. That’s left the handful of new LNG import terminals – such as the Freeport LNG terminal southwest of Houston and Cheniere Energy’s Sabine Pass terminal in Louisiana – seeking permits and funding to build the capacity to export U.S. natural gas.
Help for Europe
By freeing up LNG shipments that might otherwise have been destined for U.S. consumption, Europe will be able to draw more heavily on Middle Eastern and other future LNG sources, cutting its dependence on Russian gas.
“A more diverse energy supply for Europe enhances U.S. interests by buttressing Europe’s abilities to resist Russian interference in European affairs and help border states in the Balkans and Eastern Europe assert greater foreign policy independence from Moscow,” Medlock writes.

Read the entire article here

In an editorial the Houston Chronicle focuses on the importance of the new report from a US point of view, but the the same conclusions also apply to Europe:

Only recently it appeared that the aggressive and hard-line Russian state gas producer, Gazprom, would have a virtual death grip over Western Europe as the major source of natural gas. Likewise with the dictatorial Chavez regime in Venezuela across South America.

As the Baker report notes, the benefits also include the significant economic ones of price stability, job creation and a significant impact on this country's dangerously negative balance of payments.

This report is as important as any national security document in recent memory, touching as it does on energy policy, economic policy and national security, and offering clear solutions to what have long seemed to be intractable diplomatic and political problems. It deserves wide circulation among Washington's top policy-makers — not least the president of the United States.

We urge President Obama to read it carefully and thoroughly. He will find solutions that can make all the difference in charting a prosperous, secure future for this country.

This passage in the study is particularly interesting from a European point of view:

Rising shale gas production in the Unitied States is already impacting markets abroad. In particular, LNG supplies whose development was anchored to the beliefs that the United States would be a premium market are now being diverted to European and Asian buyers. Not only has this immediately presented consumers in Europe with an alternative to Russian pipeline supplies, its also exerting pressure on the status quo of indexing gas sales in Europe to a premium marker determined by the price of petroleum products. In fact, Russsia has already had to accept lower prices for its natural gas and is now allowing a portion of its sales in Europe to be indexed to spot natural gas markets, or regional maket hubs, rather than oil prices. This change in pricing terms signals a major paradigm shift.

The study can be uploaded here

The shale gas paradigm shift makes it clear why Russia and Gazprom are desperately (like Medvedev last week in Hanover) trying to get Germany and other European countries to sign long term delivery agreements, however, without any great success. Why should European countries bother to agree to pay high Russian prices, when they know that prices are going down as a result of the shale gas revolution. And in addition, shale gas exploration in Poland and other countries will bring even more gas on the market.

The Germans are, of course, in a somewhat more difficult situation, since they have already (foolishly) committed themselves to the Russian-German Nord Stream pipeline (which now looks less and less enticing economically). However, the German (and some other western) companies who have entered into this project probably will try to minimise their long term involvement.

The most important change that the paradigm shift will bring about in Russia is, however, not economic, but political. The entire Putin edifice is built on the assumption that Russian energy exports will continue to grow and provide huge earnings, shared between a number of supportive oligarchs, the corrupted government elite and - to a smaller degree - the rest of the population. When, due to low demand and lower prices, the money is not coming in as planned, the former KGB spy Vladimir Putin and his henchmen will not be able to cling to power.  

From a western - and indeed also Russian - point of view, the end of the Putin era is more than welcome. At least there is then hope that the end result would be a better, more democratic Russia, able and willing to engage in a real political and economic co-operation with the west.