Chancellor Angela Merkel said on Sunday she was confident that a majority of German lawmakers would back aid for Spain's ailing banking sector at a special sitting of the lower house Bundestag set for Thursday (19 July).

Euro zone finance ministers agreed last Monday on a rescue package of up to €100 billion for Spanish banks, which have been crippled by a burst housing bubble.

Merkel's government needs a green light from the Bundestag before Finance Minister Wolfgang Schaeuble can commit at a meeting of euro zone finance ministers on Friday to pay out Germany's share of the bailout.

"We always get the majority we need," Merkel said in a pre-recorded interview for ZDF television channel due to be aired on Sunday evening.

Parliamentary politics

Michael Grosse-Boehmer, chief whip of Merkel's conservatives and Volker Kauder, the conservatives' parliamentary leader, both said in newspaper interviews on Sunday they were confident Merkel would get a majority, even if it was not absolute.

But Grosse-Boehmer also sounded a cautious note, saying while the vast majority of her Christian Democrat Party (CDU)supported Merkel's course of action, some members of parliament were questioning whether they could support her on this issue.

"Everyone is aware of the concerns of the people in their electoral districts," he told Spiegel news magazine.

A small minority of lawmakers from Merkel's centre-right coalition voted recently against the euro zone's new bailout fund and new budget rules, highlighting the growing unease in Germany about the costs of supporting weaker members of the single currency bloc.

The European Commission is proposing tougher vehicle testing rules that for the first time would require inspections of all motorcycles and scooters. The move comes as the number of road deaths spiked in recent months.

Commission Vice President Siim Kallas revealed the proposed measures on Friday (13 July) amid "worrying increases" in highway fatalities after a decline of close to 50% over a decade.

Kallas also unveiled new vehicle testing proposals, which the Commission hopes could save more than 1,200 lives a year and prevent a further 36,000 accidents linked to technical failure.

Testing for scooters and motorbikes would become compulsory across the EU under the new legislation, since two-wheelers are the highest risk group among road users, the EU executive said.

If approved, the directive would require nine countries that do not inspect motorcycles and scooters to do so.

Under a new `roadworthiness package' old vehicles and those with exceptionally high mileage would be required to undergo a first test after four years, then every 2 years after.

Statistics show that the likelihood of technical failure increases dramatically after five years. Cars and light commercial vehicles of up to 3.5 tonnes which have more than 160,000 km after four years would then have to undergo yearly inspections.

The Commission also proposed EU-wide minimum standards for vehicle inspection and a clamping down on mileage fraud.

The Simon Wiesenthal Center's chief Nazi hunter, Efraim Zuroff, said on Monday that he was "thrilled" that its most wanted suspect, Hungarian Laszlo Csatary, 97, accused of complicity in the killings of 15,700 Jews in World War II, had been located in Budapest, but added he was concerned the man might flee.

OAS_RICH('Middle2'); Zuroff said he was unimpressed with Hungary's record in bringing Nazi war criminals to justice and that he had urged the prosecutor in Budapest at a meeting last week to seize Csatary's passport.

"He said he had to be declared an official suspect and questioned before that could happen. I said 'What are you waiting for?" Zuroff told SPEGEL ONLINE.

Zuroff said British tabloid daily The Sun, which photographed Csatary and reported his whereabouts on Sunday, had acted on information the Wiesenthal Center had released last September after receiving a tip-off from an informer whom the Center had paid $25,000.

'How Can I Be Confident?'

Asked if he was confident the Hungarian justice authorities would bring Csatary to trial quickly, Zuroff said: "How can I be confident? I can't be confident of that. I can hope that it can happen, the only good news is that he's very healthy, as far as we know he's still driving a car."

"The Sun deserve credit because they were willing to spend tens of thousands of pounds on tracking him to be able to get into a situation where they could photograph him and film him. They didn't discover him, but they built it up and this is already the fourth case that they helped us with."

The Center put Csatary at the top of its most wanted list in April.

François Hollande has set up a cross-party government committee to look into injecting greater morality into French politics.

The commission will examine the traditional presidential immunity from criminal prosecution and draw up guidelines covering the behaviour of ministers, MPs and others in public life.

It will also look at how to ensure gender equality in Gallic corridors of power and will consider the introduction of limited proportional representation in elections to both houses of parliament.

Hollande pledged greater transparency and openness in government during the election campaign that saw him installed as president in May.

The commission will be headed by his one-time mentor, Lionel Jospin, the Socialist former prime minister who bowed out of national politics after his shock defeat in the first round of presidential elections 10 years ago.

The 14-strong committee for the moralisation and renovation of public life also includes the former health minister Roselyne Bachelot, who served in the previous right-of-centre government, as well as magistrates, judges, academics, political specialists and senior civil servants. It is under instructions to report back to the president by November.

Germany's Chancellor Angela Merkel told her party the country risked becoming a "laughing stock" over a court ruling calling religious circumcision a criminal act, according to a report Monday.

The mass-circulation daily Bild said in an article to be published Tuesday that Merkel warned the board of her conservative Christian Democratic Union (CDU) that Germany must restore legal protection for circumcision.

"I do not want Germany to be the only country in the world in which Jews cannot practise their rites," Bild quoted Merkel as saying, citing several CDU members who attended the meeting.

"Otherwise we would make ourselves a laughing stock among nations."

Merkel's centre-right government has pledged to take quick action to protect the right of Jews and Muslims to circumcise baby boys on religious grounds, and voiced concern about the ruling by the court in Cologne published in June.

The court said the removal of the foreskin for religious reasons amounted to grievous bodily harm and was therefore illegal, in a judgement that prompted an outcry at home and abroad.

On July 23, Ivica Dacic is going to take office as Serbian prime minister. In an interview with DW he talks about the Serbian approach to Europe, his stance on Kosovo and why his political past is nothing to worry about.

DW: Regarding your own political past and your former role as spokesperson for Slobodan Milosevic - have you experienced any criticism due to that in Europe?

Ivica Dacic: I survived politically, despite Milosevic's attempts to bully me out of the party. I was elected as chair of the leading committee of the party, even though Milosevic was against it. And even though Slobodan Milosevic's family supported the other candidates, I became the party leader.

So why should anyone talk about my political past? Policy making and the results are what count. If there is anyone who has something to say about that - well, by all means. But the Ministry of the Interior, under my leadership, was the most successful ministry of the Serbian government, according to our citizens. And that's the only thing that counts.

The Serbian government - under its ruling coalition between ex-nationalists and socialists - doesn't have a good reputation among other governments in Europe. How capable is it to lead Serbia into the European Union?

Believe me, nowadays President Nikolic is a far bigger euro-fanatic than many other politicians in Serbia; and that's what other European politicians are saying. Indeed, many foreign ambassadors in Serbia approach him to then complain about my governance. I believe Nikolic had positioned himself in the eyes of the international community rather well for a victory in the elections. Probably Boris Tadic [and his way of governing the country] has helped him with that. And that's why Tadic now really shouldn't complain.

Cleaners employed to work on London's Olympic Games are facing abysmal living conditions for the, according to reports from the Daily Mail detail.

The British paper reports that cleaners are being housed in portable containers resembling trailers with ten people to a room, bathrooms shared between 25 people, and the shower to people ratio running at a ratio of 75:1.

To make matters worse, recent rains that have caused flooding on the grounds and roofs to leak, and the living situation is beginning to sound more like a refugee camp than an official Olympic ground. 

It seems that the London Organizing Committee of the Olympic and Paralympic Games (Locog) knew the conditions would be poor too -- in order to live on the ground and get the job, workers were forced to sign gag orders so they could not discuss the conditions, reports the Daily Mail. And before the workers moved in, environmental health officers gave their take on the temporary residences, describing that the bathrooms were "unlikely to be adequate" and that the sleeping arrangements would be "cramped".

Worse yet, original plans to give the jobs too out-of-work Londoners never came to fruition. Instead, the jobs were largely filled by foreign workers from places like Spain, where unemployment has forced many to relocate in search of work. 

The German constitutional court has postponed its ruling on the ESM/fiscal treaty, creating two months of acute uncertainty in the markets; the court's website says the EFSF is big enough to handle the programme for Spain, so there is no rush; Italy also has not yet ratified the ESM; uncertainty has triggered another rise in spreads: Italian 10 year spreads are now over 5%, and Spanish spreads over 5.6%; the IMF says that Spain will even miss the revised fiscal targets; predicts debt-to-GDP at close to 100%, but says a direct bank recapitalisation would significantly reduce that number; IMF also cuts global growth forecast, warning that the eurozone crisis constitute a drag on the global economy; also warns that the productive potential of the BRICs may have been exaggerated; a Spanish union warns that mass branch closures leave large parts of the population without access to banking; wealthy German states are challenging the intra-German state transfer system in the constitutional court; FT Deutschland reports that Mario Draghi received the full backing of his governing council when he pushed for senior bondholders to take losses; Christian Noyer says low policy rates do not benefit the banks; S&P warns that the extremely low interest rates are threatening the business model of money market funds; ECB's policy shift gives munition for Michael Noonan's argument to relieve the burden on Irish taxpayers; the IMF approved the next loan disbursement to Portugal,  but warns of a deficit overshoot; Gillian Tett looks at the FDIC, and says the eurozone needs a similarly decisive body to resolve the banks; Latvia, meanwhile, is on the verge of meeting the criteria for full eurozone membership.

This tension between Europeans' goals and their ability to achieve them is playing out again in the wake of the recent EU summit. Europe's leaders now agree on a vision of what the EU should become: an economic and monetary union complemented by a banking union, a fiscal union, and a political union. The trouble starts as soon as the discussion moves on to how - and especially when - the last three should be established.

...

Europe has been here before - in the 1990's, when the decision was taken to establish the euro. At that time, there were two schools of thought. One camp argued that it would be reckless to create a monetary union before economic policies had converged and institutional reforms were complete.

...

The consequences have not been happy. Monetary union without banking, fiscal, and political union has been a disaster.

But not proceeding would also have been a disaster. The 1992 crisis proved that the existing system was unstable. Not moving forward to the euro would have set up Europe for even more disruptive crises. That is why European leaders took the ambitious steps that they did.

Not proceeding now with bank recapitalization and government bond purchases would similarly lead to disaster. Europe thus finds itself in a familiar bind. The only way out is to accelerate the institution-building process significantly. Doing so will not be easy. But disaster does not wait.

ForexLive: ECB Asmussen: EMU Needs Authority To Limit Govt Debt Issuance (17 July, 2012)

Such sovereignty pooling "would imply that a euro area authority would have competence to limit countries' ability to issue debt and have intervention rights into national budgets, and to compel member states to correct their policies, be that in the fiscal, structural and financial fields," Asmussen said.

The most important consequence of running the state like a private firm is that the state should not be in the business of providing free or implicit guarantees of any kind, as these are large "contingent liabilities" threatening to bankrupt the state. The threat of bankruptcy is real, as the state must fund itself by borrowing from private lenders, unable as it is to create money to fund necessary expenses deriving from the exercisising of implicit guarantees. One alternative to bankruptcy is default, but this is considered unthinkable as defaulting on obligations to fellow EU member states is "uneuropean". In addition, countries with a large primary trade deficit may find it impossible even to default.

So, what kinds of implicit guarantees are Eurozone governments providing that they shouldn't be in the business of providing? I can think of half a dozen off the top of my head:

• deposit insurance for banks
  
• granting limited liability to businesses
  
• disaster relief
  
• access to health care
  
• access to education
  
• access to legal redress
  
• public safe[t]y

All of these are implicit guarantees that every citizen in Europe expects to enjoy relatively free of charge. These are large contingent liabilities of the state. Any and all of them could not be undertaken by a private entity that didn't charge hefty fees up front and wasn't adequately capitalised in case a particularly large claim presented itself.

The International Monetary Fund has cut its forecast for global growth to the lowest level since 2009, when the world was first emerging from the great recession.

The IMF said Monday it expects the world economy to grow 3.5% this year, 0.1 percentage points lower than its forecast three months ago, and warned that a sharper downturn was possible if policymakers in Europe and the US fail to act.

"Clearly, downside risks continue to loom large, importantly reflecting risks of delayed or insufficient policy action," the IMF wrote in the latest World Economic Outlook.

The report welcomed the measures announced at the European Union leaders' summit in June but warned that timely implementation of these measures and further progress on banking and fiscal union, "must be a priority".

In the United States, the IMF said policymakers must avoid the fiscal cliff, the expiration of Bush-era tax cuts and the imposition of $1tn in spending cuts that are both set to occur on 31 December unless a political compromise can be reached.

Growth will be slower in almost every major economy this year, the IMF believes, as fears of a deeper downturn weigh on businesses and consumers and dampen trade.

While the IMF praised actions taken to head off the euro crisis, it warned the situation in Europe "will likely remain precarious until all policy action needed for a resolution of the crisis has been taken".

The June summit of the eurozone was initially trumpeted as a decisive step towards resolving the crisis. Italy and Spain won agreement to allow European institutions to recapitalise banks and purchase sovereign debt directly.

But once financial markets had a closer look, it became clear that little of substance had been achieved, and the borrowing costs of Italy and Spain again approached forbidding heights. Meanwhile the Spanish government has imposed fresh austerity, breaking its promises to the electorate. And unemployment in the eurozone continues to rise, exceeding 11% on average.

It is now a fair guess that the European Monetary Union (or the eurozone) has crossed the Rubicon and is heading towards breakup or collapse. In the periphery of Greece, Portugal, Ireland and Spain, there is despair at the ever-deepening recession. In France and Italy there is burgeoning opposition to long-term austerity. In Germany there is frustration at feckless southerners.

Disintegration is likely to take a turn for the worse in 2013, as a global slump is in the offing. The large economies of Europe, including the UK, are entering recession largely due to austerity policies. The US economy is veering towards negative territory, as Barack Obama's expansionary policies were never vigorous enough. China is facing a hard landing that will force a re-examination of its growth strategy. The international financial system, meanwhile, remains weak and unreformed.

The European Central Bank, in a sharp turnaround, advocated imposing losses on holders of senior bonds issued by the most severely damaged Spanish savings banks--though finance ministers have for now rejected the approach, according to people familiar with discussions.

The ECB's new position was made clear by its president, Mario Draghi, at a meeting of euro-zone finance ministers discussing a rescue for Spain's struggling local lenders in Brussels the evening of July 9.

It marks a contrast from the position the central bank adopted during the 2010 bailout of Irish banks--which, like Spain's, were victims of a property meltdown--when it prevailed in its insistence that senior bondholders in bailed-out banks shouldn't suffer losses.

The ministers' decision confirmed a pattern in the euro zone for dealing with bank troubles in which senior bondholders have been spared even in the most brutal failures. But the ECB's shift may be a sign that the tides are turning on the issue, as the euro zone embarks on a fundamental overhaul of the way bank failures are dealt with within the currency union.

In the July 9 meeting, Mr. Draghi argued in favor of including senior bank creditors in burden-sharing between taxpayers and investors in the case of Spain, three people familiar with the discussions said. Two said Mr. Draghi favored forcing losses on senior bondholders only when a bank was pushed into liquidation.

This would mean senior creditors would be safe in cases where a bank was merely being downsized--so far the most common way national authorities dealt with struggling banks. In Spain, in any case, larger banks are expected to continue operations after restructuring and wouldn't have been affected.

Last week, more than 200 economists signed a petition organised by Hans-Werner Sinn, head of Germany's Ifo economics institute and the most eurosceptic voice among the country's economists. He has not yet advocated a withdrawal from the euro, but his recommendations are not consistent with the eurozone continuing in its present form. The petition focused on the banking union, and why this would open the door to a fiscal union and large-scale burden fiscal sharing.

Other economists then launched a counter-petition arguing that a banking union is a logical extension of a monetary union. That in itself is correct. But, like the pro-euro campaigners in the UK in the 1990s, they played down the implications. They said a banking union is nothing to be afraid of; there would be no transfers; there is no question of Germany taking on anybody else's banking debt.

I disagree with the views of Professor Sinn and his group. But I have to admit their position is internally coherent. It opposes transfers and ultimately accepts the break-up of the eurozone.

The position of the so-called pro-euro movement, however, is a lot less coherent. A properly constructed banking union will, of course, imply permanent transfers, as would a properly defined fiscal union. The idea that you can resolve the eurozone crisis without transfers of any sort is delusional. Since the German banking system is relatively stronger than Spain's, a banking union would, of course, imply a loss for Germany. If you have joint deposit insurance and joint banking recapitalisation, surely transfers will take place - just as they now take place inside countries themselves.

The number of companies going bankrupt rose 25% in the first six months of the year to nearly 4,000, according to new figures from the national statistics office CBS.

In total a record 3,760 firms went bust in the 2012 first half, beating the previous record set in 2009 by over 200.

The construction sector was particularly hard hit, with 495 firms going bust. This was a rise of some 44% on 2011.

`In 2000, lots of companies could absorb the downturn but after four bad years, they've now had it,' a CBS spokesman told news agency ANP.

Business services

Trading groups were also badly effected, with bankruptcies up 22% at 676. Financial and business service sector bankruptcies rose slightly to 1094.

Italy's economic performance is mentioned in the second factor mentioned by Moody's and is something I have discussed previously:

The real problem in Italy is that its economy has been stagnate for nearly the entire decade. According to the IMF between in 2000-2010 among all countries of the world Italy only grew faster than Haiti and Zimbabwe. In 2010, Italian GDP was only 2.5% higher than in 2000. This problem is actually made worse by the fact that this is such a long term trend. Italy's per-capita GDP growth was 5.4% in the 1950s, 5.1% in the 1960s, 3.1% in the 1970s, 2.2% in the 1980s and 1.4% in the 1990s. Since the new millennium the country has hardly moved forward and if we extrapolate out that trend Italy will spend the next decade in contraction.

On top of stalling growth, Italy has a demographics issue. With a debt to GDP ratio at 120% along with a population with a median age of approximately 45 Italy really does look like the Japan of Europe. The only problem is Japan is competitive, runs a trade surplus and is sovereign in its own currency. Italy has none of these things.

Italy's latest round of business data suggests that the short-t0-medium term outlook of the economy isn't about to deliver a turn around:

The latest Business Outlook survey conducted by Markit shows that confidence among Italian businesses has dropped since the start of the year, and is only slightly higher than at the height of the global financial crisis. Respondents highlighted concerns over the impact of greater fiscal pressures and a lack of credit availability on prospects for growth in output and investment in the year ahead, and have signalled their intentions to reduce staffing levels further.

And the country's PMI tells the same story:

The Irish property crash was one of the biggest in history and has proved the ruin of many as the country tries to shake off the effects of the collapse and subsequent bank bailout.

But Dylan Cullen, a 35-year-old property entrepreneur, plans to be on the side of the winners by orchestrating the firesale of properties to rich Russian buyers and by enticing Irish buyers back into the rock bottom market at home.

The sales of properties - principally on the Bulgarian Black Sea coast - range from the cheapest at €15,000 (£11,764) to the most expensive at €135,000. So far, Appreciating Assets, his company, has sold 400 Irish- or British-owned properties. Cullen estimates there may be thousands more out there waiting to be sold and he believes his business can help revive the devastated Irish market.

When the Irish economy hit the buffers, he and his partners shifted their focus from obtaining foreign properties for Irish investors to off-loading them to the Russian nouveau riche.

But now the genial and chatty Cullen, son of a leftwing councillor, says his clients are no longer distressed sellers; instead, they are looking to sell abroad to fund new purchases at home.

It's true that macroeconomists, as a group, did not see the signs of the disaster that was about to hit the economy. There were a few lonely voices who warned that a dangerous bubble was building in the housing market, but they were mostly ignored. And even after the economy's troubles became evident, it took macroeconomists longer than it should have to correctly diagnose the problem as a balance sheet recession.

...

And that dysfunction [of the US Congress] coupled with the influence of big money interests caused Congress to listen to the wrong voices. Instead of paying attention to economists who had been right about the recession all along, Congress listened to the voices that had mostly gotten things wrong. In large part, the people who favored deregulation of the financial sector, assured us there was no housing bubble, and told us problems could be easily contained even if there was a bubble are the very same people who brought us the push for austerity, the fear of inflation, the fear of bond vigilantes, and so on, none of which was helpful.

...

So while I can offer a partial defense of economists - Congress has ignored the economists it ought to be listening to - a full defense is impossible. The continued push from some economists for austerity, interest rate increases, and other policies that satisfy political and ideological goals but work against the recovery, and the failure of economists in charge of monetary policy to adopt policies consistent with the Fed's mandate undermine any attempt to fully defend the economics profession.

Syria's army blasted rebel strongholds in Damascus with mortars Sunday, sparking the "most intense" fighting in the capital since the revolt erupted 16 months ago, a monitoring group said.

The army's offensive, aimed at driving rebels of the Free Syrian Army (FSA) out of Damascus, was launched soon after the foreign ministry held a press conference to deny its troops had carried out a massacre in Treimsa village.

"The regular army fired mortar rounds into several suburbs" where FSA rebels are entrenched, said Rami Abdel Rahman, head of the Syrian Observatory for Human Rights.

The fighting was heaviest in the Tadamon, Kfar Sousa, Nahr Aisha and Sidi Qadad neighbourhoods, he said. Six civilians were reported killed in the city.

"(It has) never been this intense," Abdel Rahman said.

"The security forces are attempting to take control of these neighbourhoods but so far they have not succeeded," he added.

The Local Coordination Committees, which organise anti-regime protests in Syria, said plumes of black smoke were billowing out of Tadamon late Sunday and that loud explosions had been heard in Nahr Aisha.

The Britain-based Observatory said violence across Syria on Sunday had killed 105 people -- 48 civilians, 16 rebels and 41 soldiers.

The main opposition coalition, the Syrian National Council (SNC), hailed the insurgents fighting army troops in the capital, accusing the regime of having transformed rebel neighbourhoods into "a battlefield."

A 57-year-old Israeli man was in a critical condition yesterday after setting fire to himself during a demonstration by more than 8,000 people marking the anniversary of last summer's widespread protests in support of social and economic justice.

Moshe Silman, a former small businessman who has since fallen on dire financial circumstances, was said to have second- and third-degree burns on more than 90 per cent of his body after dousing his clothes with petrol and starting to immolate himself.

Mr Silman, who in a 265-word note he had written earlier blamed the Israeli government for having "robbed me" was shown in harrowing television footage on fire at the rally in Tel Aviv on Saturday night while demonstrators tried to put the flames out amid audible shouts of "medic" and "bring water quickly."

As politicians joined in expressing shock at the incident, Benjamin Netanyahu, Israel's Prime Minister, described it as a "great and personal tragedy" and asked the welfare and housing ministers to investigate Mr Silman's complaints of serial rejection by state agencies and the courts.

In his note, which was later read out by protesters, Mr Silman said: "The State of Israel has stolen from me and robbed me, left me with nothing. Two committees from the Ministry of Housing have rejected me, despite the fact that I have undergone a stroke and was granted 100 per cent work disability...

Elected by the 54-member pan-African bloc in Ethiopia on Sunday, she becomes the first woman to head the African Union commission.

An experienced diplomat, Dlamini-Zuma (63) is known for her competent management and stern personality.

A doctor by training, she was health minister when Mandela became the country's first black leader.

She went on to be foreign minister for a decade, earning praise for her shuttle diplomacy to end the war in the Democratic Republic of Congo.

But her critics found fault with her "quiet diplomacy" towards neighbour Zimbabwe, during a crisis that saw President Robert Mugabe evict thousands of white farmers from their land in 2000.

Her former husband President Jacob Zuma named her interior minister.

Although that was seen as a demotion, she won plaudits for turning around a ministry mired in gross mismanagement to achieve the first clean audit in 16 years.

'I'm a Zulu'
In her campaign to win the pan-African bloc's top job, she vowed to work at making it "a more efficient and effective organisation".

And while she may have defeated the incumbent, French-speaker Jean Ping of Gabon, she has refused to be labelled as an English-speaking candidate.

"I am not Anglophone, I'm Zulu," she said.

Once she got to work in the post, she added, she would be "implementing programmes ... agreed upon by everybody" rather than "consulting the Anglophone and the Francophone".

Keeping track of women's hemlines is, admittedly, an unusual way to judge the mind-set of a country's leader.

But that is just what veteran North Korea watchers have resorted to in trying to peer into one of the world's most isolated countries and divine what its new young leader, Kim Jong-un, is thinking. For weeks now, those analysts have puzzled over photos of women sporting miniskirts and heels in downtown Pyongyang, a stunning change from the years when Western wear was mostly shunned in favor of billowy traditional dresses or drab Mao-style work uniforms.

Then, Mr. Kim himself was shown on state TV giving a thumbs up to a girl band featuring leggy string players performing for him and his generals, and the debate over deeper meaning began in earnest.

In a political system that tightly choreographs its messages, could short skirts -- along with the appearance of Mickey Mouse and a film clip of Sylvester Stallone as Rocky Balboa at the same concert -- indicate some rethinking of the North's attitudes toward the West? Or was the fashion statement decidedly less weighty: perhaps another short-lived attempt to divert the attention of an unhappy populace?

Koh Yu-hwan, a North Korea expert at Dongguk University in Seoul, counts himself in the hopeful camp. He calls recent changes in the North "a glasnost," a shift he said was supported by a new generation of Communist Party members, mostly the old elite's children who, like Mr. Kim, have traveled abroad and may envision Chinese-style economic reforms.

On the other side are analysts like Lee Sung-yoon, a North Korea specialist at the Fletcher School of Tufts University in Boston, who says any belief in real change based on Mr. Kim's education in Switzerland as a teenager is wishful thinking.

It is customary to focus on the amount of money the international community offers Afghanistan: the higher the sum and the longer the commitment, the lower the risk of further destabilisation. And so the 16 billion dollars pledged by the donors for the next four years at the Tokyo conference earlier this month has been widely welcomed. But such aid may not be quite the virtue it seems.

The message of strong support at Tokyo for Afghanistan's economic development aimed to reassure Afghan people and others who are concerned that the money needs of the Afghan state cannot be met by domestic revenues.

This financing gap, "according to the World Bank, is likely to be 25 percent of GDP by 2021/22 and may be even higher in some of the intervening years," Thomas Ruttig, co-director of the Afghanistan Analysts Network (AAN), writes in a recent comment.

Last December, at the international conference on Afghanistan in Bonn, Masood Ahmad, director of the Middle East and Central Asia branch of the International Monetary Fund, estimated that "the withdrawal of foreign troops from Afghanistan (from 2014) will reduce annual GDP growth by 2-3 percentage points or more per year," and that "fiscal sustainability is a distant goal."

Such evaluations lead to the idea that the more the international community commits to Afghanistan, the better it is for that country. But, Afghanistan scholar Antonio Giustozzi tells IPS that reduction of foreign aid could be positive "because it brings the level of expenditure more in line with what realistically can be absorbed by Afghan society."

It has been slow for a chain reaction, but more than a year after the biggest nuclear crisis in a quarter century, Japanese demonstrations against atomic power are beginning to generate serious steam.

A string of some of Japan's biggest protests in decades - each attended by tens of thousands of people - have in recent weeks given voice to a wave of anti-nuclear sentiment caused by the failure of the tsunami-crippled Fukushima Daiichi plant on March 11, 2011.

By challenging the government's attempts to restart Japan's nuclear industry, the demonstrations could have far-reaching implications for energy policy in the world's third-largest economy, and thus for the sector's global development.

On Monday, an estimated 75,000 people gathered near a Tokyo park in what was dubbed by state broadcaster NHK the capital's largest anti-nuclear event yet.

Organizers and participants see recent demonstrations as signalling a fundamental change in attitudes in a nation where relatively few have been willing to take political issues to the streets since the 1960s.

Demonstrations are common in Tokyo, but they usually center on a narrow issue of policy or labor grievance and rarely attract more than a few thousand people.

Anti-nuclear numbers have yet to match those who joined 1960s protests against Japan's alliance with the U.S., but the anti-nuclear cause is being driven more by individual citizens, says Satoshi Kamata, a journalist and organiser of the Monday protest.

"It's very late, but at last it is starting," Kamata said. "Japanese people historically have not been used to standing up for themselves, we have been a people that just put up with things. . . . Finally that is changing."

A soil framework directive necessary to boost industrial regeneration is creeping back onto the European agenda after years of being shelved by reluctant EU member countries.

Reinhard Bütikofer, the deputy leader of the Greens group in the European Parliament, said sentiment over the directive might be changing in Germany, which has resisted specific EU soil legislation.

Germany's upper house, the Bundesrat, has blocked it in the past, "but the majority in that chamber has changed since that last happened," the former leader of the German Green party told EurActiv in an interview.

The European Commission has been arguing for binding legislation on soil protection since 2006, when it proposed a Framework Directive on Soil Protection as part of a broader soil strategy.

Such a directive would revivify Europe's industrial cities by preventing brownfield sites from remaining disused since it would compel governments to re-use old industrial land, Bütikofer said.

But little progress has been made and Germany, the United Kingdom, France, the Netherlands, Austria and Malta continue to form a blocking minority on the matter in the EU Council of Ministers, arguing that the directive would impinge on their national prerogatives.

"If you take a step back, however, that can hardly be a major problem because not many states have such legislation," Bütikofer said.

Volcanic ash, desert sand, sea salt and other forms of natural pollution are adding to rising levels of human-made dirt sullying the air and making it harder, especially for Mediterranean countries, to meet EU environmental regulations.

A report released this week from EU-body the European Environment Agency (EEA) found the highest levels of natural pollutants were in Spain, which frequently experiences forest fires, most recently this month.

Of 42 instances where the levels in Spain were reported above legal limits, 18 were caused by natural pollution, said the report, which is the first European study of its kind.

Spain's proximity to the Sahara desert makes it especially vulnerable, said the Observatory of Sustainability, an independent organisation in Spain.

"This will get worse [due to] desertification caused by climate change in the peninsula, converting this topic to a very important issue in Spain," the group said in a statement.

Ten other countries - including Cyprus, Greece and Italy - also reported air pollution above legal limits because of natural particles.

"This analysis shows that authorities should make extra efforts to reduce the air pollution they can control, because the cumulative effect of natural and man-made particulates can damage people's health," Jacqueline McGlade, EAA's executive director said.

While pollution from sea spray and sand result from natural phenomena, 90% of forest fires are caused by humans, as estimated by the EU research organisation.

The launch of a flagship nuclear power station in Finland has been delayed for a third time, officials say.

Finnish electricity company TVO says the Olkiluoto 3 plant will not be ready by the latest deadline of 2014 and a new timetable has not yet been set.

The plant will be powered by a new generation of nuclear technology called the European Pressurised Reactor (EPR).

China looks set to be the first country to operate an EPR reactor with one due to enter service in 2013.

Olkiluoto 3, originally due to be ready by 2009, is being built by French nuclear company Areva and German engineering giant Siemens.

In a statement, TVO said it was "not pleased with the situation" although solutions to various problems were being found one by one and work was "progressing".

It said it was waiting for a new launch date from Areva and Siemens.

ermany's lights were kept on by solar power last winter, after Berlin's rapid phase out of nuclear power brought the country to within a whisker of complete breakdown, senior energy industry sources say.

Following the Fukushima nuclear disaster in March 2011, Germany moved to close all 22 of its nuclear reactors. But problems in readjusting electricity supplies led spare capacity - the potential amount of excess production - between France and Germany to fall to just 2 gigawatts (GW) in February.

"It's almost nothing," a well-placed official told a briefing organised by the Institut français des relations internationales (IFRI), "less than one percent."

"Technicians on both sides [of the border] were aware that we were as close as we had ever been to a breakdown of the power system," he said. "We were saved by the sun."

By a stroke of fortune, Germany - which last year accounted for half of the world's installed solar photovoltaic (PV) capacity - enjoyed an extraordinarily sunny February.

Germany is one of the world's solar energy leaders with some 28 GW of PV capacity, mostly in Bavaria, connected to the power network and providing around 3% of total power output. 

Solar is an intermittent electricity generator dependent on the elements, storage facilities and back-up - often conventional - power capacity when the sun is not shining.

But given optimal times and conditions, it can create a surplus power capacity. In the February sunshine, despite Germany's own supply problems, it was actually able to increase electricity exports to France from 4GW to 5GW.   

The official, speaking on condition of anonymity, cautioned that if the electricity crisis had peaked later in the afternoon last year - rather than at lunchtime - the solar supply would not have been able to prevent power cuts. 

Nancy and her family are fishers from the Hula village in the Central Province, located on the south coast of Papua New Guinea.  Over the years, she has noticed striking changes in local fish populations.

"In the 1970s our fishermen were still using traditional fishing methods. One or two would go out in a canoe and catch fish with spears," Nancy recounted. "There was a lot of fish in our coastal area then.

But in the 1980s people began buying large dinghies and using expansive fishing nets.

"One family can own up to four or five dinghies," she continued. "Now there is less fish being caught, especially the large fish, and fishermen are trying to sell everything they get, even the tiny fish, octopus and shells.  There are fewer fish caught and they are more expensive."

According to the United Nations Food and Agriculture Organisation (FAO), 95 percent of small-scale fishers are located in developing countries and over 500 million people in the developing world depend on fisheries for food security.  Coastal subsistence fisheries production in Papua New Guinea is more than 30,000 tonnes per annum, compared to coastal commercial fisheries, which produce approximately 6,000 tonnes annually.

Papua New Guinea, part of the Coral Triangle, which includes the Solomon Islands, Indonesia, Philippines, Timor Leste and Malaysia, is home to diverse marine ecosystems.  Coastal resources of the Coral Triangle - comprised of 53 percent of the world's coral and home to 76 percent of all known corals and 37 percent of coral reef fish species - sustain 363 million people.

But climate change, especially increased air and sea surface temperatures and ocean acidification, is predicted to degrade reef habitats and spur the migration of marine species away from the equator and toward the polar extremes. Ninety percent of coral reefs could be endangered by 2030 and the SPC predicts Pacific reef fish populations could decline by 20 percent by 2050.

I retweeted a document discovered by David Tribe (a.k.a. GMO Pundit) revealing the funding sources behind the proposition for mandatory labelling of GMO foods in California - Big Organic and Big Quacka (`natural health' types) have poured $100,000s into the campaign, far outspending the biotech and grocers campaigns who oppose the proposition. The idea that consumers have a `right to choose' and therefore GMOs should all be labelled irritates me - so I tweeted that organic should be labelled with an environmental warning due to its relative land-use inefficiency. This was picked up by Simon Singh, whose tweet was called "pathetic" by the Soil Association's president Monty Don. (Simon has now blogged about this, posing two important questions for Monty Don to answer - no response as of yet.)

Lots of organic enthusiasts tweeted back at me that I had my facts wrong, or was not considering wider issues. I asked for references, and one proponent sent me the link to a piece in Nature by Verena Seufert, Navin Ramankutty and Jonathan Foley (Nature 485, 229-232, 10 May 2012, doi:10.1038/nature11069) - which I had just tweeted myself as support for my own proposal. The paper is entitled `Comparing the yields of conventional and organic agriculture' and is a meta-study looking at the relevant published literature on yield comparisons world-wide (typically evidence is cited from a single farm). Here is the major conclusion:

The average organic-to-conventional yield ratio from our meta-analysis is 0.75 (with a 95% confidence interval of 0.71 to 0.79); that is, overall, organic yields are 25% lower than conventional

This is just the overall average, however: as the figure below shows, there is considerable variability amongst different crops.

Many large lakes in Central Europe became heavily overfertilized in the twentieth century through sewage. As a result, algal blooms developed and cyanobacteria (photosynthetic bacteria) especially began to appear en masse. Some of these organisms form toxins that can compromise the use of the lake water. Dying algal blooms consume a lot of oxygen, thereby reducing the oxygen content in the lake with negative consequences for the fish stocks.

The problem with overfertilization was not merely the absolute amount of oxygen and phosphorus, the two most important nutrients for algae. Humans have also changed the ratio between the two nutrients: The phosphorus load in lakes has been reduced vastly in recent decades, yet pollution with nitrogen compounds has not decreased on the same scale. The current ratio between the nutrients can thus trigger a mass appearance of certain cyanobacteria, even in lakes that have been deemed "restored."

Burgundy blood algae grow more rapidly

"The problem today is that mankind is changing two sensitive lake properties at the same time, namely the nutrient ratios and, with global warming, water temperature," explains Thomas Posch, a limnologist from the University of Zurich. In collaboration with Zurich Water Supply, he analyzed 40 years' worth of data in a study that has just been published in Nature Climate Change.

The evaluation of this historical data on Lake Zurich reveals that the cyanobacteria Planktothrix rubescens, more commonly known as Burgundy blood algae, has developed increasingly denser blooms in the last 40 years. Like many other cyanobacteria, Planktothrix contains toxins to protect itself from being eaten by small crabs. Burgundy blood algae were first described in Lake Zurich in 1899 and are a well-known phenomenon for Zurich Water Supply. Consequently, the lake water is painstakingly treated for the drinking-water supply to remove the organism and toxins completely from the raw wate

Antipiracy efforts helped slash attacks by a third in the first half of this year, though an alarming increase in incidents in the Gulf of Guinea helped offset declines in the major piracy hot spot offshore of Somalia, the International Maritime Bureau said Monday.

According to a quarterly report published by the International Chamber of Commerce's piracy watchdog, 177 incidents of piracy were reported in the first six months of the year, down from 266 in the same period in 2011, with the decrease largely the result of a drop in Somali piracy.

The IMB attributed the decline in pirate activity in the region to efforts by international navies to disrupt piracy as well as the successful implementation of antipiracy measures by shipowners.

However, the report warned that the drop in Somali piracy was offset by a "disproportionate" increase in activity around the Gulf of Guinea, where 32 incidents were reported in 2012 compare to 25 in 2011.

It added that attacks in this region were becoming increasingly violent, with guns reported in at least 20 of the 32 incidences.

The news comes as the European Union announced plans to launch a fresh mission in the Horn of Africa to fight piracy and instability in the region.

The mission, which will get up and running in the autumn, is designed to wipe out "the scourge of piracy," the EU's foreign-policy chief Catherine Ashton said in a statement. It is part of the bloc's more aggressive crackdown on suspected pirates, and comes after the EU's antipiracy force launched their first airstrikes on a pirate camp in mainland Somalia in May.

In a Bangkok go-go bar, a prostitute in a transparent miniskirt who goes by the name "Joy" said she's ready to benefit from one of the biggest scientific breakthroughs in the 30-year fight against AIDS.

The 23-year-old sex worker says she'd like the chance to use Gilead Sciences Inc. (GILD)'s pill Truvada to help protect her from becoming one of the 530,000 people in Thailand with HIV.

"I am scared," she said, during a break at the bar. "I want to find a husband. If it works, I'll take it."

Truvada, a staple of treatment for patients with HIV, was approved today in the U.S. to lessen the risk of infection in healthy people by as much as 94 percent when taken regularly. As researchers struggle to develop an AIDS vaccine, having a daily pill to block the virus could be a crucial interim step to rein in the disease. Yet rather than celebrating Truvada's effectiveness, global health planners are now facing a difficult moment of soul searching over how to allocate limited resources.

"On the surface it's something amazing, you can prevent HIV with a pill," said Kevin Robert Frost, chief executive officer of amfAR, The Foundation for AIDS Research. "But then you start to dig deeper and it gets really complicated. When I get to the question of who pays for this I am completely dumbfounded. In developing countries, most of them can't afford to give pills to those who are HIV positive."

The government is to unveil controversial plans to make publicly funded scientific research immediately available for anyone to read for free by 2014, in the most radical shakeup of academic publishing since the invention of the internet.

Under the scheme, research papers that describe work paid for by the British taxpayer will be free online for universities, companies and individuals to use for any purpose, wherever they are in the world.

In an interview with the Guardian before Monday's announcement David Willetts, the universities and science minister, said he expected a full transformation to the open approach over the next two years.

The move reflects a groundswell of support for "open access" publishing among academics who have long protested that journal publishers make large profits by locking research behind online paywalls. "If the taxpayer has paid for this research to happen, that work shouldn't be put behind a paywall before a British citizen can read it," Willetts said.

"This will take time to build up, but within a couple of years we should see this fully feeding through."

He said he thought there would be "massive" economic benefits to making research open to everyone.

Though many academics will welcome the announcement, some scientists contacted by the Guardian were dismayed that the cost of the transition, which could reach £50m a year, must be covered by the existing science budget and that no new money would be found to fund the process. That could lead to less research and fewer valuable papers being published.

It's been two months since governments in the Netherlands and UK ordered ISPs to block BitTorrent search engine The Pirate Bay. Now, the service providers have revealed that the block has done very little to reduce the amount of peer-to-peer (P2P) traffic on their networks. TorrentFreak cites major Dutch ISP XS4All as saying BitTorrent traffic actually went up after the block. rather than down. UPC, another major ISP in the Netherlands, says that although there was a slight traffic decrease immediately after the ban, traffic quickly returned to regular levels. Two further ISPs, KPN and Ziggo, agreed that banning The Pirate Bay has little affect on P2P traffic as a whole.

In the UK, BBC News spoke with a source from a "major ISP" who echoed the Dutch findings. "We saw a fall at the time of the block," the unnamed source said, "but volumes are already pretty much back to where they were before." The British Recorded Music Industry (BPI), a trade organization funded by the majority of the UK's major and independent record labels, says the failure of The Pirate Bay block will not prevent it from pursuing similar action in the future. Geoff Taylor, the organization's chief executive, told BBC News that the BPI would "take further steps to deal with illegal sites that line their pockets by ripping off everyone who makes the music we enjoy." Given the apparent lack of efficacy of the initial ban, we doubt torrent fans are quaking in their boots at the prospect of further action.

Journalist Anton Suryapin was among the first to publish images of teddy bears reportedly found on the ground in in Belarus holding pro-free speech slogans, posting several images on the news website he manages, Belarusian News Photos (www.bnp.by).

The bears were dropped in the early morning of July 4th as part of a publicity stunt carried out by Swedish PR firm Studio Total as a show of support for pro-democracy activists in Belarus.

But at the weekend it emerged that Suryapin had been arrested by Belarusian security police on July 13th and was being detained for 72 hours, according to Russian media reports and reports on Charter 97, a news website associated with the pro-democracy movement in Belarus.

Suryapin's partner at Belarusian News Photos, Sergey Yagelo, also tweeted about his colleague's arrest and posted news of the event on the site, explaining that investigators had called Suryapin's mother to inform her of her son's arrest.

"He said that Anton Suryapin had been detained for 72 hours to determine the involvement of the editor in the 'Swedish assault'," Yagelo wrote, along with a screenshot of text messages from Suryapin saying his apartment had been searched.

Defence ministry officials in Belarus continue to dismiss the Swedish teddy bear drop as a "hoax", and media in Sweden were also initially sceptical that Studio Total had actually organized and carried out the daring flight into restricted air space.

However, Studio Total at the weekend released nearly 90 minutes of additional video footage shot from the plane which includes scenes from the take-off in Lithuania as well as aerial shots from the town of Ivyanets, the town outside of Minsk where residents reported finding teddy bears on the ground following the July 4th flight.

Jon Lord, the former keyboard player with heavy rock band Deep Purple, has died aged 71.

Lord co-founded Deep Purple in 1968 and co-wrote many of the group's songs including Smoke On The Water. He also played with bands including Whitesnake.

He had been receiving treatment for pancreatic cancer since last August.

He died at the London Clinic on Monday, surrounded by family, a statement said. "Jon passes from Darkness to Light," it added.

Lord was influenced by classical, blues and jazz but played his Hammond organ with a rock attitude and helped Deep Purple become pioneers of progressive and heavy rock.

Tributes have been paid by musicians including one-time Deep Purple bandmate Joe Satriani, Iron Maiden and Anthrax.

Ex-Rage Against the Machine star Tom Morello wrote on Twitter: "RIP the great Jon Lord, Deep Purple's cornerstone/keyboardist. So many great great songs and that incredible SOUND of his! Thankyou."