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« Reply #6375 on: May 16, 2013, 06:09 AM »


The reason France has gone into double-dip recession

This isn't a uniquely French problem – EU nations of various political hues are in trouble because of a fixation on austerity

Ann Pettifor   
guardian.co.uk, Wednesday 15 May 2013 18.21 BST   

Today's BBC headline fairly trumpets the news: "French economy returns to recession". Funny how we Brits seem happy if our trans-Manche neighbours are doing a wee bit worse than we are. Especially if you can add that it is the fault of their government for being, well, a bit too left of centre.

True, the French have just entered double-dip recession, while we have just escaped. But in fact, in recent years the French and British economies have performed pretty much similarly in terms of GDP "growth" (or lack of).

The real European news today should, though, focus not so much on France, and certainly not alone, but on the dire state of the eurozone and broader EU economies. And this has no correlation with the formal political orientation of the government (centre-left, centre-right or whatever).

There is now a group of 10 EU states, not including France or the UK, who have experienced an annual fall in GDP for each of the past four quarters. This "Austerity A10 Club" includes the usual southern Europe list of Greece, Spain, Italy, Cyprus and Portugal. But it also includes two central European countries – the Czech Republic and Hungary – and the northern bloc of Belgium, Finland and the Netherlands – the land of Jeroen Dijsselbloem, Dutch finance minister and chair of the Eurogroup finance ministers, fresh from the Cyprus bailout "triumph".

Italy's GDP has now fallen 4.8% in just two years. Its annual GDP is back to the level of the year 2000. Greece has lost a staggering 31% of GDP, compared with its peak in 2008. These are catastrophic declines that have greatly worsened in the past two years.

And even Germany and Poland – which until recently have done reasonably well – each managed last-quarter growth of just 0.1%.

The problem that unites of all of these countries and the UK is not the political colour of the government but the macroeconomic policy that has been followed. It is particularly harsh for the eurozone countries which cannot rely on a central bank to ward off the bond vigilantes, and who are subject to the Bundesbank's destructive (and increasingly self-destructive) policies of focusing on the risk of inflation just as the eurozone slides into deflation.

The deficit and debt/GDP ratio fetishes that unite the UK government, Ukip, the European Central Bank and the European commission are part of the economics of the poorhouse, where co-ordinated austerity is seen as a "solution", even while unemployment reaches mass levels unknown in Europe's modern history. Let's remember why Keynes wrote his General Theory of Employment, Interest and Money: in sum, employment must come first, the rest follows.

The problem for social democratic parties across Europe is that – scared in many cases of being viewed as anti-European – they have accepted the iron logic of the Bundesbank's dogma, and are unable to offer an alternative of generating internal European demand.

This means hitting hardest the working class and other not-so-well-off voters in their countries, who turn either inwards on themselves (depression, suicide etc) or to other political forces, mainly rightwing populism.

The only solution for Europe's social democratic parties is to say: no, time to change course. To make alliances with Greens and other new democratic forces. The European economic orthodoxy has to be challenged in unison by the centre-left parties if they are to survive and stand for any positive policies.

The EU from the outset was a balance between the interests of capital (common market) and labour (social protection). While that balance was maintained, most people across Europe were content with the EU, for all its faults. But the Troika (the ECB, the EC and the International Monetary Fund) is destroying that balance, leaving the EU simply as a neoliberal vehicle.
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« Reply #6376 on: May 16, 2013, 06:14 AM »


'Recessions can hurt, but austerity kills'

In the US, more than five million people have lost access to health care. In Greece, there's a 200% increase in HIV cases. And in some of the worst-hit countries, suicide rates are up. David Stuckler, author of an explosive new book, says the facts speak for themselves

Jon Henley   
The Guardian, Wednesday 15 May 2013 17.40 BST   

The austerity programmes administered by western governments in the wake of the 2008 global financial crisis were, of course, intended as a remedy, a tough but necessary course of treatment to relieve the symptoms of debts and deficits and to cure recession. But if, David Stuckler says, austerity had been run like a clinical trial, "It would have been discontinued. The evidence of its deadly side-effects – of the profound effects of economic choices on health – is overwhelming."   

Stuckler speaks softly, in the measured tones and carefully weighed terms of the academic, which is what he is: a leading expert on the economics of health, masters in public health degree from Yale, PhD from Cambridge, senior research leader at Oxford, 100-odd peer-reviewed papers to his name. But his message – especially here, as even the IMF starts to question chancellor George Osborne's enthusiasm for ever-deeper budget cuts – is explosive, backed by a decade of research, and based on reams of publicly available data: "Recessions," Stuckler says bluntly, "can hurt. But austerity kills."

In a powerful new book, The Body Economic, Stuckler and his colleague Sanjay Basu, an assistant professor of medicine and epidemiologist at Stanford University, show that austerity is now having a "devastating effect" on public health in Europe and North America.

The mass of data they have mined reveals that more than 10,000 additional suicides and up to a million extra cases of depression have been recorded across the two continents since governments started introducing austerity programmes in the aftermath of the crisis.

In the United States, more than five million Americans have lost access to healthcare since the recession began, essentially because when they lost their jobs, they also lost their health insurance. And in the UK, the authors say, 10,000 families have been pushed into homelessness following housing benefit cuts.

The most extreme case, says Stuckler, reeling off numbers he knows now by heart, is Greece. "There, austerity to meet targets set by the troika is leading to a public-health disaster," he says. "Greece has cut its health system by more than 40%. As the health minister said: 'These aren't cuts with a scalpel, they're cuts with a butcher's knife.'"

Worse, those cuts have been decided "not by doctors and healthcare professionals, but by economists and financial managers. The plan was simply to get health spending down to 6% of GDP. Where did that number come from? It's less than the UK, less than Germany, way less than the US."

The consequences have been dramatic. Cuts in HIV-prevention budgets have coincided with a 200% increase in the virus in Greece, driven by a sharp rise in intravenous drug use against the background of a youth unemployment rate now running at more than 50% and a spike in homelessness of around a quarter. The World Health Organisation, Stuckler says, recommends a supply of 200 clean needles a year for each intravenous drug user; groups that work with users in Athens estimate the current number available is about three.

In terms of "economic" suicides, "Greece has gone from one extreme to the other. It used to have one of Europe's lowest suicide rates; it has seen a more than 60% rise."

In general, each suicide corresponds to around 10 suicide attempts and – it varies from country to country – between 100 and 1,000 new cases of depression. In Greece, says Stuckler, "that's reflected in surveys that show a doubling in cases of depression; in psychiatry services saying they're overwhelmed; in charity helplines reporting huge increases in calls".

The country's healthcare system itself has also "signally failed to manage or cope with the threats it's facing", Stuckler notes. "There have been heavy cuts to many hospital sectors. Places lack surgical gloves, the most basic equipment. More than 200 medicines have been destocked by pharmacies who can't pay for them. When you cut with the butcher's knife, you cut both fat and lean. Ultimately, it's the patient who loses out."

Such phenomena, he says, "are just a few of many effects we're seeing. And with all this accumulation of across-the-board, eye-watering statistics, there's a cause-and-effect relationship with austerity measures. These issues became apparent not when the recession hit Greece, but with austerity."

But public health disasters such as Greece's are not inevitable, even in the very worst economic downturns. Stuckler and Basu began to look at this before the crisis hit, studying how large personal economic shocks – unemployment, loss of your home, unpayable debt – "literally could get under people's skin, and cause serious health problems".

The pair examined data from major economic upsets in the past: the Great Depression in the US; post-communist Russia's brutal transition to a market economy; Sweden's banking crisis in the early 1990s; the East-Asian debacle later that decade; Germany's painful labour market reforms early this century. "We were looking," Stuckler says, "at how rises in unemployment, which is one indicator of recession, affected people's health. We found that suicides tended to rise. We wanted to see if there was a way these suicides could be prevented."

It rapidly became clear "there was enormous variation across countries", he says. "In some countries, politicians managed the consequences of recession well, preventing rising suicides and depression. In others, there was a very close relationship between ups and downs in the economy and peaks and valleys in suicides."

Investment in intensive programmes to help people return to work – so-called Active Labour Market Programmes, well developed in Sweden (where suicides actually fell during the banking crisis) but also effective in Germany – were a factor that seemed to make a big difference.

Maintaining spending on broader social protection and welfare programmes helped, too: analysis of data from the 1930s Great Depression in the US showed that every extra $100 of relief in states that adopted the American New Deal led to about 20 fewer deaths per 1,000 births, four fewer suicides per 100,000 people and 18 fewer pneumonia deaths per 100,000 people.

"When this recession started, we began to see history repeat itself," says Stuckler. "In Spain, for example, where there was little investment in labour programmes, we saw a spike in suicides. In Finland, Iceland, countries that took steps to protect their people in hard times, there was no noticeable impact on suicide rates or other health problems.

"So I think we really noticed these harms aren't inevitable back in 2008 or 2009, early in the recession. We realised that what ultimately happens in recessions depends, essentially, on how politicians respond to them."

Poorer public health, in other words, is not an inevitable consequence of economic downturns, it amounts to a political choice – by the government of the country concerned or, in the case of the southern part of the eurozone, by the EU, European Central Bank and IMF troika.

Stuckler seizes on Iceland as an example of "an alternative. It suffered the worst banking crisis in history; all three of its biggest banks failed, its total debt jumped to 800% of GDP – far worse than what any European country faces today, relative to the size of its economy. And under pressure from public protests, its president put how to deal with the crisis to a vote. Some 93% of the population voted against paying for the bankers' recklessness with large cuts to their health and social-protection systems."

And what happened? Under Iceland's universal healthcare system, "no one lost access to care. In fact more money went into the system. We saw no rise in suicides or depressive disorders – and we looked very hard. People consumed more locally sourced fish, so diets have improved. And by 2011, Iceland, which was previously ranked the happiest society in the world, was top of that list again."

What also bugs Stuckler – an economist as well as a public-health expert – is that neither Iceland nor any other country that "protected its people when they needed it most" did so at the cost of economic recovery. "It didn't break them to invest in programmes to help people get back to work," he says, "or to save people from homelessness. Iceland now is booming; unemployment fell back to below 5% and GDP growth is above 4% – far exceeding any of other European countries that suffered major recessions."

Countries such as those in Scandinavia that took what Stuckler terms "wise, cost-effective and affordable steps that can make a difference" have seen the impact reflected not just in improved health statistics, but also in their economies. Which is why, occasionally, the austerity argument angers him.

"If there actually was a fundamental trade-off between the health of the economy and public health, maybe there would be a real debate to be had," he says. "But there isn't. Investing in programmes that protect the nation's health is not only the right thing to do, it can help spur economic recovery. We show that. The data shows that."

Drilling into the data shows the fiscal multiplier – the economic bang, if you like, per government buck spent, or cost per buck cut – for spending on healthcare, education and social protection is many times greater than that for money ploughed into, for example, bank bailouts or defence spending.

"That," says Stuckler, "seems to me essential knowledge if you want to minimise the economic damage, to understand which cuts will be the least harmful to the economy. But if you look at the pattern of the cuts that have happened, it's been the exact opposite."

So in this current economic crisis, there are countries – Iceland, Sweden, Finland – that are showing positive health trends, and there are countries that are not: Greece, Spain, now maybe Italy. Teetering between the two extremes, Stuckler reckons, is Britain.

The UK, he says, is "one of the clearest expressions of how austerity kills". Suicides were falling in this country before the recession, he notes. Then, coinciding with a surge in unemployment, they spiked in 2008 and 2009. As unemployment dipped again in 2009 and 2010, so too did suicides. But since the election and the coalition government's introduction of austerity measures – and particularly cuts in public sector jobs across the country – suicides are back.

Ministers seem unwilling to address the increase in suicides, arguing it is too early to conclude anything from the data. Stuckler points out that this is because the Department of Health prefers to use three-year rolling averages that even out annual fluctuations. But based on the actual data, he is in no doubt. "We've seen a second wave – of austerity suicides," he says. "And they've been concentrated in the north and north-east, places like Yorkshire and Humber, with large rises in unemployment. Whereas London … We're now seeing polarisation across the UK in mental-health issues."

He cites, also, the dire impact on homelessness – falling in Britain until 2010 – of government cuts to social housing budgets, and the human tragedies triggered by the fitness-for-work evaluations, designed to weed out disability benefit fraud.

"What's so particularly tragic about those," he says, "is that the government's own estimates of fraud by persons with disabilities is less than the sum of the contract awarded to the company carrying out the tests."

At least, though, no one in the UK has been denied access to healthcare – yet. Stuckler confesses to being "heartbroken" as what he sees happening to the NHS. "Britain stood out as the great protector of its people's health in this recession," he says. "By all measures – public satisfaction, quality, access – the UK was at or near the top, and at very low relative cost."

But that, he says, is now changing. "I don't know if people quite realise how fundamental this government's transformation of the NHS is," he says. "And once it's in place, it will be difficult, if not impossible, to reverse. We haven't yet seen here what can happen when people are denied access to healthcare, but the US system gives us a pretty clear warning."

He finds this all in stark and depressing contrast to the post-second world war period, when Britain's debt was more than 200% of GDP (far higher than any European country's today, bar Iceland) and the country's leaders responded not by cutting spending but by founding the welfare state – "paving the way, incidentally, for decades of prosperity. And within 10 years, debt had halved."

The Body Economic should come as a broadside, morally armour-plated and data-reinforced. The austerity debate, Stuckler says, is "a public discussion that needs to be held. Politicians talk endlessly about debts and deficits, but without regard to the human cost of their decisions."

What its authors hope is that politicians will take the message they have uncovered in the data seriously, and start basing policy on evidence rather than ideology. (Some already do. When Stuckler and Basu presented some of their findings in the Swedish parliament, the MPs' response was: "Why are you telling us this? We know it. It's why we set up these programmes." Others, notably in Greece, have sought to divert responsibility.)

"Our book," says Stuckler, "shows that the cost of austerity can be calculated in human lives. It articulates how austerity kills. It shows austerity and health is always a false economy – no matter how positively some people view it, because for them it shrinks the role of the state, or reduces payments into a system they never use anyway."

When times are hard, governments need to invest more – or, at the very least, cut where it does least harm. It is dangerous and economically damaging to cut vital supports at a time when people need them most.

"So there is an opportunity here," Stuckler concludes, "to make a lasting difference. To set our economies on track for a happier, healthier future, as we did in the postwar period. To get our priorities as a society right. It's not yet too late. Almost, but not quite."

The Body Economic: Why Austerity Kills by David Stuckler and Sanjay Basu is published by Allen Lane on May 21 (rrp £20).


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« Reply #6377 on: May 16, 2013, 06:16 AM »

 SPIEGEL ONLINE
05/15/2013 03:53 PM

Coming to Germany: Spanish Workers Look for a Future in Bavaria

By Andrew Bowen in Munich, Germany

Youth unemployment in Spain is enormously high, yet some companies in Germany can't find the skilled labor they need. Now, a program in Bavaria is trying to kill two birds with one stone. It has been overwhelmed with applications and the first Spanish newcomers have begun arriving.

It's a cool, cloudy morning in Munich as Antonio nimbly climbs up the narrow ladders of the scaffolding outside Wilhelmstrasse 17. The six-story building is under renovation -- one of several in the neighborhood -- and the metal work that lines each floor has to be replaced and molded to the building.

When Antonio reaches the top, his boss greets him and promptly demonstrates how to use a hammer and pliers to fasten a small sheet of copper to the gutter. His explanation of the task is a crude exchange of hand motions and incomplete sentences -- Antonio understands almost no German. But he picks up the work quickly. It's his fourth day on the job.

Antonio José García Roca, 27, is one of 11 Spanish immigrants participating in a pilot program organized by the Chamber of Crafts for Munich and Upper Bavaria. The program aims to address the shortage of medium-skilled specialized workers among small- and medium-sized German companies, considered to be the engine that keeps the German economy humming. Spaniards between the ages of 18 and 30 possessed of job training and work experience are paired with employers in and around Munich that have job openings. Now in its ninth month, the program hopes to place at least 21 Spanish workers in Germany by the end of its pilot phase at the end of the year.

"Given the high youth unemployment in Spain at the moment, there was this idea that there are a lot of people in Spain who could do the work, (and) we have a lot of companies that need to fill their vacancies," said Elisabeth Kirchbichler, one of the coordinators of the program. "So let's bring them together."

Increasing Immigration from Spain

Spain's unemployment rate is at an all-time high of 27.2 percent. It is even worse among youth, at 57 percent. Kirchbichler says she and her colleague were shocked on a recent trip to Cordoba when officials from the local chamber of commerce handed over a USB drive containing well over 1,000 applications -- a fact that highlights the massive amount of interest among Spanish youth in coming to Germany.

The flow of immigrants is already well underway. Figures released last week indicate that the number of people coming to Germany from Southern Europe sharply increased in 2012, with 9,000 more immigrants arriving from Spain than in the previous year, a jump of 45 percent.

García Roca has the tall and strong build of a manual laborer, wears a pointed stud in his left ear and has a thick accent that gives him away as being from southern Spain. His home state of Andalucia has the second highest unemployment rate in the country.

"I have 20 friends who are unemployed," García Roca says, sitting down for an interview at a café around the corner from the construction site. "Most of them worked in construction and manual labor, and there's no work there."

Upon completing the minimum education level in Spain at age 16, he received vocational training in welding. After working four years in the shipbuilding business, the sector collapsed along with the rest of the construction industry amid the economic crisis and García Roca lost his job in 2009. "The banks stopped lending them money to build ships, so they kicked 80 percent of the people onto the street," he says. "And I was one of them."

Searching for a Future in Germany

Odd jobs and seasonal work in the tourism sector provided little relief. García Roca says he grew tired of relying on his parents and wanted to become more independent -- to buy a house and start a family some day. "I had a dream, and if I stayed in Spain I wasn't going to achieve it," he says. He knew Germany's economy was doing better, so he saved up money from a summer job and bought a one-way ticket to Munich, landing in November 2012. It was the first time he had ever left Spain.

García Roca says he lucked out in that he found work relatively quickly, handling packages for the postal service. But staying at a hostel quickly ate up all his savings, and a merciful but meager payday advance from his part-time job lasted all of two weeks.

The details of the time that followed are murky. García Roca bites his lower lip and inhales, repeating several times that things were "complicated." He slept on the couches of various people he met, relying on the kindness of semi-strangers, before he found his way to a Catholic relief organization. A counselor there pointed him to the Chamber of Crafts, which eventually found him the job he now has at Moreno Nigro Tinsmith and Roofing Co. Nigro and his wife offered García Roca a room in their home, where he is staying until he can move into his own place in June.

García Roca is atypical of the program's participants in that he came to Germany independently. The standard procedure is for the Chamber of Crafts to match German companies with youth who have submitted applications in Spain. They then organize a Skype interview between applicant and employer, and if both sides are interested, the chamber pays for a round-trip plane ticket and accommodation for the applicant to come and work for a short trial period.

Should the German employer decide to hire the Spanish applicant full-time, the chamber pays for another ticket to Germany and helps the new hire get settled, which includes subsidizing their rent for the first 5 months and paying for German language classes.

Integration Via the Private Sector

The Chamber of Crafts declined to reveal its budget for the program, but said that roughly half of the money comes from its own funds while the other half comes from the EU's European Social Fund and the Bavarian Labor Ministry.

Demetri Papademetriou, president of the Migration Policy Institute Europe, a Brussels-based think tank, says that when integration became a hot-button issue in the middle of the last decade, the government was the driving force. That is now changing. The program by the Munich Chamber of Crafts reflects a growing awareness among private companies and labor unions that they, too, have a stake in the integration of their immigrant employees.

"There is nothing more important than enlightened self-interest," he says. "A worker who speaks the language, who's better adjusted in terms of his or her life in the community, who understands what it means to be a member of that community, is a better worker."

This is not, of course, the first time Germany has imported foreign labor to fill a gap. The postwar "economic miracle" was made possible to a significant degree by Germany's guest worker program, which brought in laborers from Italy, Greece, Turkey and other Southern European countries.

At the heart of the program was the assumption that the guest workers would ultimately return home, making integration superfluous. But many guest workers opted to stay in Germany, and many employers saw no sense in sending them home after investing in their training. Nowadays politicians and social scientists point to this lack of foresight in the guest worker program when explaining the tensions between "native" Germans and those with immigrant backgrounds.

'Lessons Have Definitely Been Learned'

"I think some lessons have definitely been learned," Kirchbichler says. "People just didn't know that those problems would occur. I think now we have learned the importance of (things like) language classes."

As a European Union citizen, García Roca doesn't need a visa to work in Germany. Yet EU rules allowing freedom of movement across borders address only the most basic legal barriers to immigration within the bloc. Once here, García Roca and the other Spanish immigrants needed help navigating a host of bureaucratic hurdles, like registering with the city, finding accommodation and opening a bank account.

Moreno Nigro, the owner of the company that hired García Roca, says there's little interest among young Germans entering the workforce in learning the tinsmith and roofing crafts. Thus it would be better for his business, and for the many other small businesses that can't find qualified workers to fill open positions, if immigrants like García Roca were to stay in Germany long-term.

"We're very satisfied, he fits in with us," Nigro says. "In a small business you have to fit in. He's always positive -- he even sings on the job."

The Chamber of Crafts also believes that program participants wish to establish themselves in Germany. "I think a lot of them are aware that the economic crisis in Spain will not be something that will pass within a few months," says Kirchbichler. "I think they do see a future here."

García Roca is less certain. He says his main goal now is to continue to learn the tinsmith trade and the German language, and to save some money. When asked what it would take for him to commit to staying longer, he laughs. "Get a German girlfriend," he says.


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« Reply #6378 on: May 16, 2013, 06:23 AM »

Anger over East German medical ‘human guinea pigs’

By Agence France-Presse
Thursday, May 16, 2013 7:42 EDT

Germany is confronting another chapter from its past — allegations that Western drug companies used more than 50,000 people in the former communist East as “human guinea pigs” in 1980s medical trials.

News magazine Spiegel this week reported that a who’s who of big German, Swiss and US pharmaceutical companies made deals with the dictatorship to test medicines, sometimes without the knowledge of the patients.

Several people were known to have died during trials, and some tests involved infants and delirious alcoholics, said the report on the agreements with the police state that collapsed with the 1989 fall of the Berlin Wall.

Major drugs companies, some of which have taken over other firms in corporate mergers since, insist they stuck to the standards and laws of the times.

But calls have grown for full transparency into the agreements overseen by the State Security (Stasi) secret police to earn the communist state tens of millions in hard-currency Deutschmarks.

“It was a nasty German-German deal” in which profits were made on both sides of the Berlin Wall, Stasi Archives Commissioner Roland Jahn, who was a dissident-journalist in the former German Democratic Republic (GDR), told the Zeit weekly on Thursday.

“I am not surprised that medical tests were carried out in the GDR that didn’t meet the standards of democratic countries. The dictatorship was capable of a lot.”

A senior member of the opposition Greens party Volker Beck this week demanded a full investigation into what he called “the systematic circumvention of ethical and legal standards in drug trials by pharmaceutical companies in the GDR”.

Health Minister Daniel Bahr urged drugs companies to financially support an inquiry, while the Berlin Charite hospital announced it would search its archives to bring clarity.

The commissioner for questions on the former East Germany, Christoph Bergner, on Wednesday said he had “promised financial support” to the Charite project, without mentioning amounts or details.

The Spiegel report said some 600 clinical trials, including for blood pressure and depression drugs, were carried out in more than 50 hospitals, according to previously unpublished documents of the East German health ministry, pharmaceutical institute and Stasi.

The German drug industry’s Association of Research-Based Pharmaceutical Companies in a statement said the tests met the common standards of the time.

“GDR law had requirements for the conduct of clinical studies that were comparable to those of Western countries including the United States,” said its chief executive Birgit Fischer.

Several major drugs companies contacted by AFP said they would support an inquiry.

Germany’s Bayer said it always applies equal standards in its medical trials worldwide, and that it presumed the GDR had followed its own laws at the time.

A Novartis spokesman said the Swiss group was open to cooperating with an independent research group, provided the transfer of sensitive patient data to third parties complies with legal standards.

And a Roche spokesman said the company was completely committed to applying rules and guidelines but pointed out that the “state of knowledge” had changed in the past 30 years.

Critics charge that, even if strict guidelines exist on paper, carrying out drug trials in police states or poor countries means rules may not be enforced, and that even patients informed about the risks may have little choice but to consent.

Jahn told the Zeit weekly that “I am not aware that during GDR times anyone looked into whether the tests complied with the rules”.

“The State Security was tasked with covering up the drug tests. They were meant to secure the hard-currency deals and prevent disruptions, and for that they set up a spying system. We know that much from the files.”

For East Germany, the millions in profits aimed to “preserve the power” of the regime and “to get the ramshackle health system going”, he said.

For victims groups who suffered under the communist regime, the report revived some bitter memories.

Rainer Wagner, chairman of the Union of Groups of Victims of Communist Tyranny, said it showed how “leaders of the criminal state the GDR were chasing Western cash and therefore knew no moral scruples”.

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 SPIEGEL ONLINE
05/14/2013 05:37 PM

Deadly Side Effects: New Details Emerge in East German Drug Test Scandal

By Nicola Kuhrt and Peter Wensierski

Until the fall of the Wall, Western pharmaceutical companies conducted drug trials in East German hospitals. More than 50,000 patients served as subjects, often without their knowledge, and many died. The human experiments haven't been fully investigated to this day despite fresh evidence of wrongdoing.

Nicole Preiss was nine when her mother died in 1986. The woman had been stricken by skin cancer, which was deemed benign at first. But there was something, a strange remark, that little Nicole didn't understand. Why on earth, her stone-faced father and grandparents had asked at the time, did the doctors administer "drugs from the Berlin Westapotheke pharmacy " to her? And why did her condition worsen considerably after that?

Preiss, now 37, is still searching for answers today, still trying to understand what East German doctors did to her mother at a hospital in the city of Erfurt.

She suspects the doctors were testing a new drug from the West on their patient. "My mother's case was even presented in the lecture hall," says Preiss. But the treatment didn't do her any good. "There are too many secrets associated with her death, at the age of only 30," says her daughter, who is now seeking to finally gain access to the files and find answers to the questions of which drugs, which tests and which pharmaceutical companies played a role in her mother's death.

Some 50,000 Participated in Drug Tests

Preiss isn't the only one. Apparently at least 50,000 people in the German Democratic Republic (GDR), or East Germany, served as test subjects for the Western pharmaceutical industry, often unknowingly. Drug manufacturers, especially from West Germany, Switzerland and the United States, engaged GDR hospitals to perform more than 600 clinical drug trials, some with fatal consequences. This emerges from previously unknown documents, to which SPIEGEL has gained access, from the private archives of individual physicians, from the files of the former East German Health Ministry and the Ministry for State Security (Stasi), as well as the country's Institute for Drug Regulatory Affairs.

The East German institutions participating in the arrangement included internationally renowned university hospitals, like Charité Hospital in East Berlin, as well as more than 50 hospitals throughout the country, in such cities as Dresden, Erfurt, Halle, Jena and Rostock.

Virtually every major name in the pharmaceutical industry was involved, including Bayer, Schering, Hoechst, Boehringer, Pfizer, Sandoz and Roche. The companies administered everything produced in their research laboratories: chemotherapy drugs, antidepressants and heart medications, as well as other substances fresh from the laboratory, the effects of which were still largely unknown to scientists.

Human trials are among the darker chapters of the pharmaceutical industry's history. Medical progress has always claimed victims. But medical research becomes particularly dangerous to patients when efforts to benefit mankind are dominated by the quest for quick profits. When this happens, researchers overstep limits that should never be exceeded, jeopardizing the health and lives of people in the interest of improving a company's bottom line.

Today drug manufacturers depend on emerging economies like India, China and Russia when they want to test new drugs quickly and inexpensively. In the 1970s and 80s, though, the ideal testing ground was conveniently nearby: in East Germany.

The mechanism is similar today to the way it was back then. Many patients don't know what their doctors are prescribing to them, regulators in partner countries dispense with thorough testing to secure urgently needed hard currency or modern medical technology, and a critical public hardly exists at all.

The West's Responsibility

The human trials that were conducted in East Germany on behalf of West German firms still haven't been fully investigated, although Germany's current coalition government of the center-right Christian Democratic Union (CDU) and the pro-business Free Democratic Party (FDP) will address the issue on Tuesday. The effort to come to terms with the former East German dictatorship should not consist solely of addressing the issues surrounding the country's notorious secret police, the Stasi, reads a motion for debate in the German parliament, the Bundestag. According to the motion, drug trials in East German hospitals demonstrate that "West German companies also profited," just as they did from forced labor in East German prisons. The lawmakers argue that, for this reason, "society and the scientific community should focus more heavily on" the West's responsibility.

But that is a responsibility that the former business partners have shirked until now. Hospitals are either unwilling to release their records on drug trials involving their patients or they have already destroyed them. This was Nicole Preiss's experience when she wanted to review her deceased mother's medical file, but she isn't the only one.

Pharmaceutical industry leaders are being especially uncooperative. The data from the clinical trials are stored in their archives, and if a number of industry executives have their way, that's where they will stay.

"I don't want to see these kinds of investigations here," says Ulrich Vorderwülbecke. He is the director of Research-Based Pharmaceutical Companies (VFA) and has been working as a lobbyist for the last 30 years. "There have been no suspicions so far that something shady was going on," he adds. Vorderwülbecke suggests that an "outside authority," perhaps headed by the German Interior Ministry, should address the issue.

When individual companies are asked today about their former business practices in East Germany, they are suddenly overcome by amnesia. "Well, that was a long time ago," they typically respond. Employees who might be able to provide information on the issue, they say, are no longer employed there, deceased or suffering from dementia. Some companies refuse to talk to journalists altogether.

Recruiting the 'Class Enemy'

In the early 1980s, Fehrbelliner Strasse in Prenzlauer Berg, a neighborhood of East Berlin at the time, was a stronghold of East German opposition. It was home to civil rights activists like Bärbel Bohley, the Catholic congregation of Wolfgang Thierse, who is now the deputy president of the Bundestag, and a rehearsal space used by punk bands like Rosa Extra and Feeling B, a few members of which later formed the metal band Rammstein.

Other residents began noticing unusual activities taking place at Fehrbelliner Strasse 5. "We had no idea what was going on there, but different cars with West German license plates were parked outside every day," recalls Carlo Jordan, a member of the opposition who later became one of the founders of the Green Party in East Berlin.

The civil rights activists had no way of knowing that the East German health ministry had rented an apartment in the dilapidated building in 1983, which was used as a contact point for Western managers. It was officially known as the "Advisory Office for Drugs and Medical Devices" (BBA). According to visitor logs, which read like a who's who of the Western medical industry, there were weeks when up to 40 pharmaceutical industry representatives came to the office.

"Now you too can become one of our customers." Those were the words with which Joachim Petzold, the head of the advisory office, recruited the drug manufacturers, from the West, otherwise known as the class enemy during GDR times, starting in 1983. It was a breakthrough: the institutionalization of a lucrative business relationship.

Up to 800,000 Deutsche Marks Per Study

First lobbyists for the likes of Bayer and Schering had to discreetly negotiate with their East German contacts over patient trials. To that end, marketing people from the West had been regularly traveling to the Leipzig Trade Fair since the 1970s, bringing along gifts for their hosts -- based on the requests, large and small, they had previously received from the heads of East German hospitals. Many of their wishes were fulfilled, not out of charity but for business reasons. The companies donated computers and other equipment, and they also invited East German doctors to attend lavish meetings in the West.

Starting in 1983, the Western companies were able to officially submit their offers to a central office. During their visits to Fehrbelliner Strasse, the pharmaceutical representatives offered the East Germans up to 800,000 deutsche marks per study. Petzold and his comrades at the Health Ministry drummed up the funds for their republic, raising millions for the struggling East German economy. Like a pimp, their government sold its sick citizens and prostituted the country as a laboratory for the West's clinical trials.

The dismal condition of the East German healthcare system was one reason that the Western customers had such an easy job of it. Although East German doctors went to great lengths to improvise as much as possible, citizens faced growing waiting lists for life-saving operations, there was a shortage of effective drugs and necessary treatments were not performed.

Even Ludwig Mecklinger, the then East German health minister, had no illusions. In office from 1971 to 1989, he was known for bluntly stating his position, albeit not openly.

In a 1983 meeting of top East German officials, Mecklinger outlined the extent of the dire problems facing the healthcare system. Mecklinger died in 1994, but according to documents from his archives, he feared "growing frustration within the population and among doctors" in light of the state of healthcare, and noted the East Germany had "fallen almost completely behind" international standards. The country was increasingly behind the curve in all key areas of diagnosis and treatment, Mecklinger wrote, adding that East Germany was inferior to West Germany when it came to mortality rates in almost all age groups in recent years.

Alexander Schalck-Golodkowski, who consistently raised Western capital for the regime in convoluted ways, occasionally managed to come up with injections of funding for hospitals. They were then suddenly showered with gifts of disposable gloves and surgical materials, in the same way people in East Germany could briefly look forward to oranges and bananas during the Christmas season (fruits that were extremely difficult or impossible to get during other times of the year).

But his efforts were far from sufficient to rehabilitate the healthcare system. Mecklinger, Schalck-Golodkowski and a small group of experts discussed ways to address the problem. They knew that human trials were required before a drug could be approved, and they also knew that the West German Federal Health Ministry had tightened its requirements for these trials. After the thalidomide (sold under the brand name Contergan in Germany) scandal of the 1960s, the public had become far more critical in the West and was taking a more skeptical view of animal experiments and human trials.

The East German officials agreed that such problems would not arise in the German Democratic Republic (GDR). But they disagreed over how to distribute the hard currency they expected to raise. Schalck-Golodkowski initially wanted to see 60 percent of the proceeds paid to his Berliner Import & Export Gesellschaft (BIEG), whose profits went directly into the coffers of the then East German leader Erich Honecker. Mecklinger preferred to see the money invested in his backward hospitals. After 20 minutes, the meeting ended with Schalck-Golodkowski and Mecklinger agreeing to split the spoils evenly, paving the way for the advisory office in Prenzlauer Berg to begin its work.

No Objections to Using East Germans as Guinea Pigs
A profitable period began for the business partners. Take, for example, Schering. On Oct. 15, 1985, employees of the West Berlin pharmaceutical company, which Bayer acquired in 2006, made a trip to their new testing ground.

Even at the border crossing, executive board member Heinz Hannse and development head Werner-Karl Raff were given preferred treatment. They were greeted in the East by a high-ranking delegation of representatives of the Health Ministry and Charité Hospital, as well as employees of Schalck's BIEG.

The initial negotiations revolved around a series of tests of Rolipram, a psychotropic drug, a contrast agent called Echosan and Iloprost, a drug designed to treat severe circulatory disorders. The East German officials had no objection to allowing their Western partners to use the people of the GDR as guinea pigs.

During a break, one of the Schering executives took aside the Charité representative, Dietmar S. In a private conversation, the two men discussed Schering's desire to have even more drugs tested, including nifedipine, a medication to treat high blood pressure, with which the company hoped to generate substantial profits.

The Schering representative offered Charité a deal worth six million deutsche marks a year, noting that this amounted to a third of the company's entire budget for clinical trials. The GDR, he said, was an attractive business partner for Schering, and the proposed arrangement could spell the beginning of even more lucrative deals. "In our mutually commercial interest," he added, it would be preferable to leave aside the political issues involved.

He also had some good news for Charité, he said, namely that Schering executive board member Hannse had spoken with the then-mayor of West Berlin, Eberhard Diepgen. Hannse, he explained, had discussed with Diepgen "the scope of Schering's business plans with the GDR, so as to possibly set aside potential political reservations of the CDU/FDP Berlin Senate (the official name for the city government), or to secure the necessary political backing."

Conflicts and Moral Qualms

Did the West Berlin Senate provide support for patient trials in the East German dictatorship? "I can no longer recall the exact details," says Diepgen. "If that was the case, we would have treated it as a normal development at the time. We had no reason to review the medical aspects of cases under the jurisdiction of the Federal Health Office."

Stasi reports on conversations among East German doctors highlight the conflicts they faced and the moral qualms they confronted.

According to these reports, Christian Thierfelder, the director of research at Charité, sought to explain the generous offer from the West by saying that, first of all, it offered Schering the opportunity to "bolster its international standing with clinical trial reports from Charité, a reputable institution." Second, Thierfelder argued, Schering was handicapped by the fact that it "could not perform certain tests in West Germany, because of the prevailing public mood there." For this reason, he added, Schering was interested in having trials performed at Charité "that the press in the West has already portrayed as undignified and inhumane."

The company, Thierfelder said, apparently had "general ethical problems when it comes to using human beings as guinea pigs." This was because well-heeled patients in the West were refusing to "submit to such treatments." Thierfelder argued that because Bayer and Hoechst had made similar offers recently at the Leipzig Trade Fair, if the public learned about the trials, the GDR would acquire the dubious reputation of being a "low-cost country" and an "inexpensive proving ground."

But such qualms were apparently overcome. Representatives of both sides met once again two weeks later, this time at Schering, where they signed a framework agreement, to be followed by several agreements on individual testing series.

Fatalities and Snail-Paced Investigations

In addition to Charité, many other East German hospitals began testing drugs on their patients. The trials resulted in several fatalities, which the participating hospitals were slow to investigate. Some studies had to be discontinued because of serious side effects that had suddenly occurred.

"I experienced it myself," says Hubert Bruchmüller, 59, from the eastern German state of Saxony-Anhalt. A former electrician, he was diagnosed with myocarditis when he was 35. "I might be the only survivor of clinical trials that were performed at the Lostau Chest Clinic in 1989," he says.

His family doctor had referred him to the hospital near the eastern city of Magdeburg, he says, "because, as he said, they had a new drug there for me." The word "test" wasn't mentioned, he adds. His doctor, he says, told him that he should take advantage of the opportunity, and that if he did he would have access to the drug in the future. "I wasn't suspicious at all, and I went there full of hope. Nothing was explained to me, and I didn't have to sign anything, either."

Bruchmüller was given shiny yellow capsules from a small container labeled: "Cardiac agent, patient No. 030," by Sandoz. The pharmaceutical company is part of Novartis today. When his roommate, who received the same treatment and was listed as "patient No. 029," collapsed and, according to the medical record, died of "acute cardiac failure," the test of Sandoz's antihypertensive drug Spirapril was abruptly terminated.

Apparently the case of Patient No. 29, as well as that of another fatality, was not investigated. The only reference to it is a brief comment in the files of the Zentraler Gutachterausschuss für den Arzneimittelverkehr, a board that evaluated adverse drug reactions for the Health Ministry in East Berlin. The minutes of a meeting that took place on March 6, 1990, shortly before the demise of the GDR, included the following remark: "Prof. Dr. Assmann is to be reminded of her duty to provide a statement on the two fatalities in Lostau."

Bruchmüller, who still has his Sandoz pill container with a few pills left in it, paid another visit to Lostau last winter. He was permitted to take a brief look at his medical file, but he has since been waiting for months for the copies he requested.

The doctors involved in the study in 1989 are now far away, working at private hospitals somewhere in Germany. "And besides, who is in a position to fight the powerful pharmaceutical companies?" Bruchmüller asks, sounding resigned.

Problems Abound

Other drug trials also resulted in fatalities. In 1988 Hoechst, now part of the Sanofi Group, tested the drug Trental, a treatment for poor blood circulation, in East Germany.

Hoechst had the drug tested against a placebo. The subjects were not told whether they were taking the real drug or the placebo. Two patients died. Although the trial was eventually terminated, the East German clinical investigators took their time doing so. At a meeting on Feb. 17, 1989, they decided to establish a task force to address problems with the trial, and they also requested a complete list of infusion volumes before taking further action.

Problems were also encountered with Ramipril, a drug developed by Hoechst to treat high blood pressure. In the Ramipril trial, half of the patients were also placed in the placebo group, which meant that they were exposed to the risk of stroke or heart attack. The doctors treating the patients were also kept in the dark over which patients received the drug or the placebo.

The East Germans involved in the business end of the deal were ecstatic. The trial would generate 500,000 deutsche marks in revenue, and it had "produced the best result to date in this field!"

But a senior physician at Charité at the time voiced concerns, saying: "The company wants to demonstrate efficacy and sell the drug." The Hoechst trial, he told a senior Stasi officer, could "lead to acute hazards to health and even death. And the doctor doesn't even know what's happening, which prevents him from responding, that is, if that's even possible anymore and the patient hasn't died yet."

When the doctor took his case to Petzold at the advisory office on Fehrbelliner Strasse, who had prepared the agreement with Hoechst, he was unsuccessful. The disappointed physician reported "that others signed the agreement, over the heads of Charité, focusing primarily on the money," which was "unacceptable."

Drugs Administered to Babies

Boehringer Mannheim, now owned by the Roche Group, even conducted experiments in East Germany that it would have hard a hard time explaining to West Germans. The company tested erythropoietin (commonly known as EPO), a substance that has been abused as a performance-enhancing drug, on "premature babies," according to 1989 reports.

Thirty preemies weighing between 750 and 1,500 grams (1.6 to 3.2 lbs.) were given the hormone to stimulate the production of red blood cells at Charité. The study protocol called for administration of the synthetically produced agent at three-day intervals. The tiny subjects were between four and 25 days old. Today the manufacturer is either unable or unwilling to explain how the drug was administered to the babies.

Meanwhile, Bayer was testing nimodipine, a drug used to improve cerebral blood flow, at the Central Clinic for Psychiatry and Neurology in East Berlin. Some of the subjects were alcoholics in acute delirium who, as a result of their condition, could not be questioned to obtain their consent. According to hospital records, the drug reduced their blood pressure and caused perspiration and trembling.

The Role of Doctors
Ulrich Moebius, a doctor who went from being a pharmaceutical manager to a critic of the industry after the Contergan affair, characterizes these tests as a crime. "They could have killed people," he says. Bayer rejects the accusations, saying that East German physicians were the ones who proposed the tests.

Severely depressed East German citizens were also used in drug trials. Instead of treating patients in acute phases with drugs with demonstrated efficacy in treating their disease, Charité doctors used them to test two antidepressants known for their severe side effects, levoprotyline and Ludiomil. The trial was done of behalf of Swiss firm Ciba-Geigy, which is now part of Novartis. Moebius, the co-founder of arznei-telegramm, a German medical journal critical of the pharmaceutical industry, classifies levoprotyline as one of the so-called dirty drugs. The East German tests would not have been possible in Western countries he says.

But the East German clinical investigators running the trial almost never detected problems with the patient trials, either because they could not or would not recognize them. In response to the sudden cardiac death of a patient who had participated in a trial involving Roche's drug carvedilol in 1989, they merely concluded that the patient's death was to be "classified as an event possible within the context of his illness." What exactly happened was never determined.

Could the physicians involved at GDR hospitals have recognized the dangers of the drug trials? Should they have opposed the Socialist Unity Party (SED) officials' deals with the Western pharmaceutical industry, and should they done more to protect the interests of their patients?

Harald Mau developed the pediatric surgery department at Charité, which he headed until 1983. He later become director of pediatric surgery and eventually was named dean of the hospital. Few people are as familiar with Berlin's largest hospital.

The dictatorial system left research directors and medical directors with no alternatives, he says. "One mistake, or one objection, and they would no longer have enjoyed the benefits resulting from the pharmaceutical testing," says Mau, who retired four years ago. Some gave and others took, he explains, and those who didn't participate with sufficient enthusiasm faced the wrath of their colleagues, because their lack of cooperation translated into the loss of benefits for their respective departments.

'It Brings In Hard Currency, So We'll Do It!'

"If we were lucky, the proceeds went directly to the department, and instruments could be purchased. If things didn't go well, the clinic kept the money or it was spent at the Charité level," says Mau. In the context of the competitive socialist system, the hospital administration would announce, at the end of each year, the amount of deutsche marks each department had earned. This meant that doctors who conducted the studies for Western companies were constantly under pressure to acquire hard currency in competition with one another. Mau remembers a sentence often uttered by senior physicians at Charité at the time: "It brings in hard currency, so we'll do it!"

Mau himself conducted clinical trials with antibiotics in his pediatric ward. "Everyone knew that when a new narcotic or a new sedative was coming, we would try it out, all in the context of 'testing,'" says Mau. Hospital staff documented the drugs' effects on patients for the Western pharmaceutical companies. The study protocols clearly defined how often they were to take various readings, including blood pressure and lipid and cholesterol levels.

Everything was done in a strictly hierarchical manner, and providing doctors with insights into the system frowned upon. The medical director at Charité passed on the orders to conduct trials to the clinic directors, who in turn notified the department heads. The drugs were always supplied through the hospital pharmacy, where they were treated like gold. The doctors were told: "We have received a Western drug, and you now have the opportunity to use it." But they were also expected to carefully document everything, which they were told was Charité's contribution in return for receiving the drugs.

The surgeons, neurologists and pediatricians working in the wards were given pills, as if out of thin air, without being told the circumstances under which they had made it across the Berlin Wall. "No one knew what agreements had been signed, and with whom," says Mau.

All of this was kept from patients, who were inadequately informed about the risks and side effects of the drugs being tested on them. A written informed consent was viewed as unnecessary.

Issues related to informed consent were handled by the SED medical officials, in direct coordination with the drug makers. In the case of Hoechst, for example, the company expressly declared in 1989 that it agreed with "information about the drugs remaining with the investigator and not being given to the patient."

This statement appears in the minutes of a meeting between Hoechst managers and an East German representative in Frankfurt on March 6, 1989. "The patient's consent is documented by the signatures of the treating physician and one witness," the document also reads. A comparable approach would have been inconceivable in West Germany. The company did not respond specifically to questions about the case.

Extremely Awkward Insights for Drug Makers

Such insights into their past are extremely awkward for the drug makers, which, following a wave of mergers, have mutated into giant global corporations. They don't coincide with the preferred self-image of an industry that pledges to uphold exemplary ethical standards. "In every clinical trial, the safety of participants is more important than anything else," writes the VFA in a statement. "We are responsible not only to ourselves, but to the entire world," Bayer HealthCare avers in its Global Guidelines.

The companies are especially confident when it comes to one issue: The human trials in East Germany were also done strictly according to protocol. Pfizer, the world's largest pharmaceutical company, which acquired Mack Illertissen, a company that had ordered many clinical trials on the other side of the Berlin Wall, insists that it is "not aware of any information on these issues."

Bayer also believes that everything was done by the book, says a spokesman. "At Bayer, all clinical trials were conducted and still are conducted in accordance with uniform global standards." Officials at Boehringer Ingelheim claim to be aware of only three studies conducted in the former East Germany, even though records indicate that there were at least twice as many.

Even the German government has done little to clear up this particularly dirty chapter of inter-German relations. But this is especially relevant, because the drugs tested in the GDR were later approved by the West German Federal Health Office, which was part of the Health Ministry. "Everyone at the Federal Health Office knew that Western companies were conducting clinical trials in East Germany," says Peter Schönhöfer, who headed the Office's department for post-approval drug safety until 1982. "No one ever asked why or how."

And yet there were high-level political talks on inter-German cooperation in medicine. For instance, records show that when West German Health Minister Rita Süssmuth (CDU) met with her East German counterpart, Mecklinger, she stated in a private conversation that West Germany had a special interest in "cooperation in scientific research."

Klaus Jürgen Henning, who in the 1980s was the spokesman for the Federal Health Office, which reported to Süssmuth, says today that when it came to drug licensing, West German officials had no concerns about studies done at East German hospitals, and that they were treated as the equivalent of West German studies. A spokesperson for Süssmuth says that she "was too unfamiliar with the issue" and that she could provide no "detailed information about trials in the GDR."

Time of the Essence for Researching Trials

The recent debate over the use of forced prison labor in East Germany shows that avoiding and ignoring the mistakes of the past isn't the only approach. In March, the Union of Associations for Victims of Communist Tyranny launched a research project on the issue in March. The effort is funded by furniture retailer IKEA, which had some of its products, including the Billy line of bookshelves, manufactured in East German prisons.

Germany isn't nearly as far along when it comes to addressing the pharmaceutical trials. Volker Hess, a medical historian, is finally interviewing contemporary witnesses at Charité and wants to see the archives completely declassified, so that researchers can identify the perpetrators and the victims. A two- to three-year research project would be needed, says Hess, although, as he notes, the VFA hasn't been willing to provide any funding for the effort yet.

Time is of the essence, because of the risk of important evidence of the human trials being lost. As part of regular housecleaning, Charité is in the process of destroying its files from 1983. In an old warehouse in Berlin's Tempelhof district, forklifts are currently transporting boxes of records to be destroyed.

Translated from the German by Christopher Sultan

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 SPIEGEL ONLINE
05/14/2013 05:56 PM

Testing Meds: Companies Look Overseas for Cheap Subjects

By Nicola Kuhrt

For years, major pharmaceutical companies have been testing new drugs in developing countries like India. The practice is forbidden, but the use of subcontractors makes it difficult to detect.

In 2008, the Indian Uday Foundation published a controversial list. In it, the children's aid organization identified the names of every medicine that had been tested by the All India Institute of Medical Sciences. Within two and a half years, 49 babies died in the hospital during clinical studies.

Among the various substances tested on children was the anti-hypertensive drug Valsartan. The compound was produced by the Swiss manufacturer Novartis. The company denies all culpability in the deaths. "The children that participated in the tests were very ill. It cannot be determined that administering Valsartan was the cause of death for any of these patients," says Novartis spokesman Michael Schiendorfer. Would similar tests have been possible in Germany or Switzerland? How would the public react if babies had died at a clinic in Basel or Frankfurt?

International drug manufacturers regularly avoid such questions -- while sending their new substances around the world to be tested. India, Brazil, Russia and China are all popular destination countries.

Several studies indicate that more than half of all drug trials worldwide take place in newly industrialized countries. Not only are the studies cheaper to carry out there, but many participants are thankful that they are being cared for in any way at all. The companies are lured by the prospect that established international standards are less stringently applied than they are in Western Europe, Japan or the United States.

Human Rights Standards Ignored

The Declaration of Helsinki leaves no doubt as to the required procedure for medical testing. Authored by the World Medical Association in 1964 and last revised in 2008, the document outlines how participants in medical tests should be protected from harm. It reads: "In medical research involving human subjects, the well-being of the individual research subject must take precedence over all other interests." Moreover, it stipulates, the needs of the economically and medically disadvantaged must particularly be taken into consideration.

Yet when it comes to the everyday practice of researchers, these precepts are often disregarded. Whether the drug companies abide by all the rules is scarcely possible to monitor. Many manufacturers outsource the often controversial pill testing to smaller firms in developing countries, the so-called clinical research organizations, or CROs. Among the tasks of CROs are the planning, preparation and implementation of clinical studies, along with data management, monitoring and the recruitment of test subjects.

The size of the Association of Clinical Research Organizations attests to how powerful the CROs have become. In 2008, companies contracted by major pharmaceutical companies planned and carried out more than 9,000 studies involving around 2 million test subjects in 115 countries. The sales amounted to some €15.4 billion ($20 billion), according to estimates, equivalent to a third of all global spending on drug research.

A Race for Profits

Fast, cost-effective, reliable: The CROs aggressively advertise their services on their websites. Such promises are well-received by the large manufacturers. The more quickly each phase of a clinical study can be completed, the sooner the companies can put profitable new drugs on the market. This is something companies like Bayer, GlaxoSmithKline and Pfizer have apparently already recognized. All three firms have tested medicine in India.

The biopharmaceutical company AstraZeneca tested its circulation-enhancing drug Ticagrelor at Bhopal Memorial Hospital & Research Centre. The hospital was founded after more than an estimated 10,000 people died in a chemical disaster in the city of Bhopal in 1984. The survivors received medical treatment in the clinic. But some of them also incidentally served as test subjects for a non-yet-approved heart medicine.


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 SPIEGEL ONLINE
05/14/2013 04:18 PM

Letter From Berlin: Anti-Euro Party a Growing Challenge for Merkel

By SPIEGEL Staff

German Chancellor Angela Merkel wanted to ignore the Alternative for Germany. But with the anti-euro party gaining ground, many among her conservatives say it is time to change strategy. They are concerned that the currency heretics could cost Merkel her re-election.

Germany's center-right has long been in a luxurious position. Whereas conservatives across Europe have been struggling in recent years with the rise of right-wing populist parties eating into their base, Chancellor Angela Merkel's Christian Democrats have had little to worry about. Though the German left is splintered among three, or even four, parties, the right is a monolith. There is the CDU, its Bavarian wing known as the Christian Social Union, and its favorite coalition partner, the Free Democrats (FDP).

But this election year is different. With thebirth of the anti-euro party Alternative for Germany (AfD), Merkel is facing competition from within her own clientele. Furthermore, though her preferred strategy has been that of maintaining complete silence about the AfD so as not to lend it credibility, there are many in Merkel's party who disagree with that approach. And they are increasingly giving voice to their displeasure.

"To imagine that nobody will talk about the AfD if we avoid talking about them would be a fatal conclusion to draw," says Wolfgang Bosbach, a senior CDU member and chair of the Internal Affairs Committee in German parliament. The party, he says, has to confront critics of the euro "with well founded arguments."

Bosbach was quoted in the Monday edition of SPIEGEL in an article that also included details from a paper written by CDU leaders from a trio of German states protesting against the party's strategy in dealing with the AfD. The authors of the paper urged the CDU to "take the new party seriously" and to engage it in a debate on the issues.

Widespread Interest

Merkel was furious. In a Monday party meeting, she complained bitterly about the critique reported on by SPIEGEL and took the authors of the paper to task. "We are both older than 18," she snapped at one of the renegade party members, according to meeting participants.

Her touchiness is understandable. For months, the CDU and the FDP have sought to ignore the Alternative for Germany in the hopes that it would simply disappear as so many anti-euro movements have in the past. Instead, though, the party has quickly grown. Earlier this month, it surpassed the 10,000 member mark -- just seven weeks after its official founding -- and it has attracted widespread interest among the German electorate.

More worrisome, significant elements within Merkel's CDU have grown uncomfortable with massive bailouts of heavily indebted euro-zone member states, with several conservative lawmakers either abstaining or voting no on aid packages in German parliament last year. While no parliamentarians have yet abandoned the CDU, the Alternative for Germany has proven adept at attracting lower-ranking CDU and FDP members. Just last week, a state lawmaker with the FDP in Hesse named Jochen Paulus switched parties.

Many see the AfD as a political home representing what German conservatives used to stand for, before Merkel moved the CDU to the center in recent years. And before the euro crisis forced Berlin to embark on the expensive path of saving the common European currency. While most Germans remain favorable toward the euro, a significant number are not -- and many of them are political conservatives.

The fact that AfD head Bernd Lucke is a professor of economics, with many of the other founders working as economists, academics, lawyers or business leaders, has also helped. For one, it lends the party the aura of respectability and expertise. For another, it has helped the party to quickly navigate the various bureaucratic obstacles for establishing a party and getting on the ballot. Furthermore, even as there have been some complaints that the party has not done enough to clearly define its right-most boundary, the AdL has not emerged thus far as a home for racists and Islamophobes. Party leadership has also been careful to keep a tight rein on the kind of cranks who often plague new political movements, even if that has meant strict limits on grassroots influence on strategic decisions.

'Our People'

Still, despite the early successes, few pollsters believe that the party will be able to leap the 5 percent hurdle necessary for representation in German parliament. But even a result of 2-3 percent would be more than respectable. And more to the point, with the FDP likewise struggling to attract sufficient votes to surpass the minimum, any supporters lost to the AdL could prove dangerous for Merkel's re-election ambitions.

That, in short, is why the CDU is nervous. "You only have to see the television images from AfD events to see that they could easily be our people," says Michael Fuchs, an economic expert within the Christian Democrats.

The FDP is likewise growing concerned. Whereas the CDU's coalition partner in mid-April saw the Alternative for Germany as being primarily a problem for Merkel's conservatives, that view is slowly changing, particularly after Matthias Niebel, cousin of long-time FDP General Secretary Dirk Niebel, who is currently Merkel's Development Minister, switched from the FDP to the AfD earlier this year.

"The FDP has to take the AfD much more seriously because its message is one that is dangerous for the coalition," says Frank Schäffler, a senior FDP official in Hamburg. "You can't simply launch heavy-handed attacks and you certainly can't ignore them."

No Internal Conflict

Given the AfD's central plank, a pledge to withdraw Germany from the European common currency zone and reintroduce the deutschmark, challenging the party wouldn't be difficult, say many politicians and economists. Were the euro zone to collapse, Germany's currency would appreciate dramatically, with exports becoming 30 percent more expensive virtually overnight, they say. An economic crisis and significant unemployment would be the result. The paper written by the CDU leaders from three German states proposes using such arguments to publicly challenge the AfD.

There were indications on Monday that, despite Merkel's anger, the conservatives might be considering doing just that. In a press conference following a meeting in Berlin, CDU General Secretary Hermann Gröhe insisted that there was no internal conflict within his party.

He then proceeded to hold forth on the dangers associated with leaving the euro.

With reporting by Melanie Amann, Matthias Bartsch, Peter Müller, Ralf Neukirch, Michael Sauga and Philipp Wittrock

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 SPIEGEL ONLINE
05/14/2013 04:04 PM

New Biography Causes Stir: How Close Was Merkel to the Communist System?

A biography focusing on Chancellor Angela Merkel's time growing up in East Germany is making headlines because it suggests she was closer to the communist system than hitherto known. Her spokesman has denied she has covered anything up.

A new biography covering Chancellor Angela Merkel's life in East Germany has caused a stir by suggesting she was closer to the communist apparatus and its ideology than previously thought.

Published this week and written by journalists Günther Lachmann and Ralf Georg Reuth, the book quotes Gunter Walther, a former colleague of hers at the Academy of Sciences in East Berlin, as saying she had been secretary for "Agitation and Propaganda" in the Freie Deutsche Jugend (FDJ) youth organization at the institute. Merkel, a trained physicist, worked at the academy from 1978 until 1989.

Excerpts from the book, "The First Life of Angela M.," were published in the newsmagazine Focus on Monday. The mass-circulation Bild newspaper has also given the book prominent coverage in recent days.

The book explores Merkel's life growing up in German Democratic Republic (GDR), where her father Horst Kasner was a Protestant pastor and a committed socialist. He moved to East Germany from West Germany in 1954.

Merkel has said in the past that her FDJ role at the academy was more that of a cultural secretary and that her duties included buying theater tickets and organizing book readings.

'Closeness to the System'

But former German Transport Minister Günther Krause -- an eastern German politician who worked with her in the final months of the GDR and as a fellow minister in the government ex-chancellor Helmut Kohl in the early 1990s -- contradicts her in the book and says she propagated Marxism-Leninism.

"With Agitation and Propaganda you're responsible for brainwashing in the sense of Marxism," he said. "That was her task and that wasn't cultural work. Agitation and Propaganda, that was the group that was meant to fill people's brains with everything you were supposed to believe in the GDR, with all the ideological tricks. And what annoys me about this woman is simply the fact that she doesn't admit to a closeness to the system in the GDR. From a scientific standpoint she wasn't indispensable at the Academy of Sciences. But she was useful as a pastor's daughter in terms of Marxism-Leninism. And she's denying that. But it's the truth."

On Sunday evening, Merkel said she hadn't covered up anything about her past. "I can only rely on my memory," she said at a public screening of her favorite movie, a popular love film made in East Germany, on Sunday night. "If something turns out to be different, I can live with that."

Her spokesman, Steffen Seibert, denied on Monday that the chancellor had ever covered up political aspects of her life in East Germany. "The chancellor has been making statements about her life in the GDR for years in books and interviews," he said. "She always answered questions openly and based on her honest memories."

The book adds that Merkel and her father refused all attempts by the Ministry for State Security or Stasi, the feared secret police, to recruit them as informants.

A Latecomer to the East German Reform Movement

Merkel, who speaks good Russian, was well informed about Perestroika and the distancing of the Soviet government from the East German regime, the book says. She read Soviet President Mikhail Gorbachev's speeches in the Communist Party newspaper Pravda, and made contacts with East German reform groups only a few months before the Berlin Wall fell in November 1989.

The book says she and her father and brother Marcus discussed political developments with other people on September 1989. For them, the biography says, German unification was still inconceivable at that point "not just because it wouldn't have fitted into the bipolar world but because they strictly rejected the Western system of society."

It quotes Merkel as having said at the time: "If we reform the GDR, it won't be in terms of the Federal Republic."

Merkel's political ascent after that is well documented. She joined the opposition political movement Demokratischer Aufbruch (Democratic Awakening) in December 1989, became deputy spokeswoman of the democratically elected transitional East German government after the May 1990 election and joined the staunchly conservative Christian Democratic Union party in 1990s -- a surprising move given her apparent previous political leanings.

'Not Many Know What She's Really Thinking'

The chancellor at the time, Helmut Kohl spotted her potential and made her family affairs minister in his cabinet after the November 1990 German election. The rest is history.

"Only Angela Merkel herself can answer how much of her old life is still in her," Focus magazine wrote.

Her past may have contributed to making her inscrutable. Focus quotes Werner Schulz, a member of the European Parliament for the Greens who grew up in East Germany, as saying: "Her secrecy is a legacy of the GDR, I think. At the time you had to be careful about blurting out your opinions without thinking first. (…) Even today not many people know what she's really thinking."

In power since 2005, Merkel is running for a third term in a September general election. She is widely expected to win. Her inscrutability and political shrewdness are legendary. She has sidelined every potential rival in the male-dominated, largely Catholic CDU. There's no obvious successor to her in her party and she's far more popular than her challenger from the center-left Social Democratic Party, Peer Steinbrück.

Critic: Book Spreads Spurious Conspiracy Theory

According to SPIEGEL journalist Stefan Berg, the book hasn't really shed any new light on the first 35 years of Merkel's life. Instead, he writes, it has thrown a fresh veil over it -- a veil of supposed conspiracy. "A disproportionate amount of mistrust runs through this book," writes Berg, who was born in East Berlin in 1964. "While Merkel's own declarations are eagerly called into question, intelligence reports are taken at face value and Socialist phrases are taken more seriously than they were in GDR times."

The book makes the "perfidious" suggestion that secret powers aided Merkel's path into politics, that she is some kind of Soviet plant, writes Berg.

"Those who lived in the GDR can recall that everything was in disarray in the autumn of 1989, when careeers ended and new ones opened up -- a lot of it by chance, unintended, surprising. But coincidence is the enemy of journalists who -- firstly -- weren't there and -- secondly -- often see spies or other concealed forces at work. When they find no clues or can't interpret the clues they find, they see that as further evidence of their theory."

The book, writes Berg, paints a scenario in which "only naïve people can believe that Merkel wasn't steered by unknown forces." In fact, it doesn't present significant new facts, he adds.

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« Reply #6380 on: May 16, 2013, 06:30 AM »


Latvia: Stateless Russians seek identity

15 May 2013
Lietuvos Rytas Vilnius

Ever since Latvia gained independence with the dissolution of the USSR, the status of the Russian minority has remained a divisive issue. Following a referendum on the use of the Russian language, today the focus of debate is on the question of citizenship.

Tomas Ancytis

No one could accuse Vladimir Linderman of a lack of ideas or enthusiasm. Not so long ago, he triggered a heated debate with his idea for a referendum to recognise Russian as Latvia’s official second language. The failure of the referendum came as no surprise, but Linderman has now moved on to other preoccupations. In particular, he is focusing on the issue of Latvia’s “non-citizens”.

Linderman is campaigning for these “aliens”, most of whom are of Russian nationality but deprived of Latvian or other citizenship, to be automatically granted Latvian passports. [Latvia distinguishes between citizenship and nationality. Citizenship is defined as belonging to a country. However, nationality is determined solely on the basis of ethnic criteria].

Although the Kremlin is upset about the allegedly deplorable situation of stateless Russians, the majority of non-citizens tend not to want to change anything.

Marina Afanasenko, age 51, works as a street sweeper. Caught in the path of her broom, scraps of torn election posters are there to remind her that Riga will shortly be holding municipal elections [on June 1]. But for Marina, who is not entitled to vote, they are just meaningless pieces of paper.
No political voice

“For my husband and I, the election campaigns are like a huge TV show. In front of the television every evening, we get to see who has been elected, or who has joined the coalition. But for 20 years, we have had no influence on this process,” she sighs.

Marina is one of Latvia’s 300,000 non-citizens. “It is all because I was not born to the right family,” she explains. Her Russian parents emigrated to Soviet-occupied Latvia in 1947 and 1952. When independence was restored, only people who were Latvian citizens before June 17, 1940, the date when the Soviet occupation began, were recognised as citizens. And the same rule automatically applied to their descendants.

“I can see some logic in denying citizenship to my parents who were immigrants. But as for my children and myself, we were born in Latvia. We are not responsible for what happened before we were born,” argues Mrs Afanasenko.

The granting of citizenship is conditional on passing a written language and history test. However, that does not mean that by learning Latvian, Marina would be able to solve all of her problems, because she is unwilling to acknowledge that the Soviet Union occupied Latvia, which is the correct answer on the history test. “I really think there was no occupation. Latvia voluntarily joined the Soviet Union. Why should I be forced to lie,” she insists.

Kristine is a dark-haired Russian speaker in her 30s. Unlike Marina, she is hardly worried about the question of occupation and whether or not it took place. She has just left the premises of the Latvian naturalisation office where she sat the history test.

Travel freedoms

“I got it,” she announces exultantly. In three or four months, she will return here to exchange her purple stateless passport for a blue Latvian one. However, Kristine is largely unconcerned about the colour of her identity papers. “I am planning to move to Great Britain soon, and as a Latvian citizen, I will not face any obstacles.” She is very much typical of the type of non-citizen who passes the exam in Latvia.

“The number of applications for naturalisation increases when advantages associated with Latvian citizenship become apparent. For example, in 2005 [a year after the country joined the EU], approximately 20,000 non-citizens applied for naturalisation. Three years later, and in the wake of decisions by the Commonwealth of Independent States and later Russia to exempt non-citizens from a requirement to obtain visas, the number of applications has declined dramatically,” explains the manager of the Latvian naturalisation office. Barely more than 2,000 people now apply for naturalisation every year.

Alternative elections

One of the new ideas from the groups that support non-citizens is alternative elections. “The congress of non-citizens” is planing to organise a vote this year, to coincide with official local elections in Latvia. The goal of the initiative is to create a “parliament” to take charge of the rights of non-citizens.

“Anyone from an EU country who has lived in Latvia for at least a year can vote and even stand for election. I, however, cannot, even though I was born here and have lived here all my life,” affirms Vladimir Linderman.

It is hard to believe that this friendly man who speaks such good Latvian is the same person who threatened to blow himself up in the tower of Saint Peter’s Church in 2001, when the “Russian Bolsheviks” were on trial in Latvia.

“I have decided to apply for Russian citizenship,” he announces. While Marina adds: “Russia is offering retirement at age 55, whereas in Latvia, you have to wait until you are 65." However, one question remains: is Russia willing to welcome her?


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« Reply #6381 on: May 16, 2013, 06:35 AM »

State Department official denounces ‘repression’ in lead-up to Iranian presidential election

By Agence France-Presse
Wednesday, May 15, 2013 17:45 EDT

US officials Wednesday slammed a campaign of “unrelenting repression” ahead of Iran’s presidential elections, and said the outcome would be very hard to predict amid a secret vetting process.

The future direction of the next Iranian leadership in ongoing talks with world powers about the Islamic republic’s suspect nuclear program was also difficult to determine, top State Department officials told US lawmakers.

“There are probably some candidates who would be perceived by us as more interested in looking at the nuclear negotiations in a more positive vein,” under secretary of state Wendy Sherman said.

“However the nuclear file is held by the supreme leader and no one else, and he is the final decision maker regarding the nuclear file.”

The race for Iran’s highest elected office took a stunning turn at the weekend when former president Akbar Hashemi Rafsanjani and top nuclear negotiator Saeed Jalili officially registered for the June 14 election.

President Mahmoud Ahmadinejad is constitutionally barred from seeking a third consecutive term. But on Saturday he endorsed his controversial aide and ex-chief of staff Esfandiar Rahim Mashaei.

Jalili, a known hardliner, is close to Iranian supreme leader Ayatollah Ali Khamenei, and was Wednesday in Istanbul for a new round of talks with EU foreign policy chief Catherine Ashton.

But the final line-up of presidential candidates will not be known until later this month when Iran’s Guardians Council releases the approved list of names after the vetting process.

Denouncing “a deliberate and unrelenting level of repression in the lead-up to these elections,” Sherman told the Senate Foreign Relations committee that the council was “using vague criteria to eliminate potential candidates.”

“Without a transparent process, it is difficult for us to say whether Iran’s elections will be free, fair, or represent the will of the Iranian people.”

Conservatives were “pushing very hard against Mashaei and Rafsanjani, because they don’t see either of those candidates as tough enough,” she said.

“We don’t know the impact — as you may recall in 2009, everyone thought Ahmadinejad was going to be one kind of leader and he’s turned out to be quite another kind of leader.”

Ahmadinejad’s disputed re-election in 2009 sparked massive street protests, leading to a heavy-handed regime crackdown and the arrest of hundreds of journalists, activists and reformist supporters.

“We take no sides in Iran’s presidential election,” Sherman insisted.

“The decision about who leads Iran is for the Iranian people, who should have every opportunity to express freely and openly their opinions, ideas, and hopes for the future of their country.”


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« Reply #6382 on: May 16, 2013, 06:36 AM »

 SPIEGEL ONLINE
05/14/2013 12:25 PM

Afghanistan Exit: Kabul and Berlin Estranged as Withdrawal Looms

By Ralf Beste, Matthias Gebauer and Gordon Repinski

With the security situation deteriorating in Afghanistan, Chancellor Merkel paid a visit to German troops last week without even informing Afghan President Karzai. The move highlights frosty relations between Berlin and Kabul amid difficult negotiations for the 2014 troop withdrawal.

It's a hot morning at the German military's Kunduz field camp when Chancellor Angela Merkel has a brief close encounter with war. She looks up at a soldier, a man who towers 2 meters (6.5 feet) tall, with tattoos up to his neck. The rifle hanging in front of his chest comes to the height of her face. Surrounding the chancellor and the soldier are his unit's light-wheeled tanks, which ran into an improvised explosive device two weeks ago. The troops are lined up at attention.

Against this backdrop, the chancellor wants to know what war feels like. She has just a brief moment. "How many attacks have there been?" she asks. "Seven," the soldier replies. Merkel nods, reflects for a second and says: "Not nice!" Fortunately, the soldier assures her, nothing has ever happened aside from material damage. "Well, I'm sure it gave you quite a scare!" Merkel says. Then the chancellor hurries on.

Quite a scare -- that is occasionally Berlin's view of the war. But the reality in Afghanistan became clear the weekend before last when one German and seven American ISAF soldiers were killed during attacks and clashes with the enemy.

The death of this Bundeswehr soldier called to mind a war that hardly receives any attention anymore in Germany. After all, the withdrawal has already begun and the German military has weathered the worst of the fighting, or at least that's what many had hoped after nearly two years without a combat casualty.

But the latest German soldier killed in action is emblematic of the security situation on the ground, which began deteriorating once again during the first few months of this year. After 11 years in Afghanistan, the Bundeswehr faces the most difficult year of its military mission. While the Taliban gains ground amid a rising number of attacks and clashes, it has to master the massive logistical challenge of a withdrawal.

The German military will leave behind a country still far from peace after decades of war. It seems that the decline in clashes over the past year was not a sign of the sustainable success of the West, but merely a tactical break by the insurgents.

Roughly one-and-a-half years before the planned end of the international military effort, its success appears more doubtful than ever. German politicians deflect attention from the imminent failure of this mission -- which was designed to bring security, stability and democracy to Afghanistan -- with vague demands for "reforms" and progress in the "political process."

Among the Bundeswehr soldiers in the two large camps in Kunduz and Mazar-e-Sharif the mood was gloomy during the week following the deadly clash. "Death seemed so far away," says a friend of the dead soldier, "now it has come one step closer."

Serious Concerns about Withdrawal

Depressing figures recently released by the Afghanistan NGO Safety Office in Kabul confirm this impression. According to the organization, the number of attacks by Afghan insurgents during the first quarter of 2013 rose by 47 percent in comparison to the previous year, with most now directed against Afghan security forces.

The statistics paint a grim picture for the Bundeswehr's area of operations in the north of the country. In many regions the number of clashes has increased, and the situation is even worse in southern and eastern Afghanistan.

There has even been increased fighting in parts of Badakhshan Province in the northeastern part of the country, which has been relatively calm until recently. At the end of last year, the Bundeswehr held an official ceremony in which it handed over control of its camp in Faizabad to the Afghan security forces, a move that was seen as a test of how the situation might develop after the troop withdrawal. Now, ISAF officials are doing their best not to recognize any trend in the dramatic increase in the number of incidents. No one is willing to admit the possibility of failure in the northeast.

The withdrawal has begun and heavily-loaded military transport aircraft leave the country and head west nearly every day. The first camps have already been closed, and this year the Bundeswehr intends to close its fortress at OP North and the Kunduz field camp.

In northern Afghanistan the government is expressing serious concerns about the withdrawal of the Germans, which is proceeding much more rapidly than many had imagined. Atta Mohammed Noor, the powerful governor of the northern Afghan region of Balkh, is urging a long-term German mission in Mazar-e-Sharif. "Without the help of the Germans, the army will quickly fall apart again," he warns. "Which is why a further stationing of troops is urgently required here."

While the situation is better than it was during the crisis year of 2011, says German State Secretary of Defense Christian Schmidt, who visited Bundeswehr troops last week, he admits that "the Afghans are still unable to achieve security on their own." In other words, the security situation is so precarious that Afghanistan is in danger of sinking into chaos and civil war after the withdrawal of ISAF troops.

Frosty Relations

It still remains unclear whether, and how, the international mission will continue following the withdrawal at the end of 2014. In April, Germany pressed ahead with an offer to station 600 to 800 soldiers to train Afghan military forces starting in 2015. The main objective of this early commitment was to ensure that the issue remained out of the election campaign as Germans go to the polls in September 2013.

Nevertheless, German Defense Minister Thomas de Maizière pointed out in April that this offer depends on a number of factors. As planned, NATO must launch a training mission throughout the country, and not merely in Kabul, he said. The UN Security Council must also grant this military force a mandate, he added. But above all, the minister demanded that Kabul be more obliging, saying that he expected a formal invitation from the Afghan government: "We want to be welcome," de Maizière said.

That invitation has not been extended, though. In view of the shaky security situation, it is particularly important to maintain good relations with the Afghan hosts during the withdrawal phase. Only by working in close cooperation with Kabul can NATO member states plan an effective military involvement for the period following the withdrawal at the end of 2014. However, Chancellor Merkel appears to have little interest in this.

Her brief visit last Friday illustrated once again how strained relations remain between Berlin and Kabul after 11 years of the German mission in Afghanistan. There is so little trust that German protocol officers didn't even bother to announce the chancellor's arrival to their counterparts in Kabul.

There would have been an opportunity for a phone call with Afghan President Hamid Karzai shortly before Merkel disembarked from her government aircraft in Mazar-e-Sharif at 6 a.m. -- but no telephone conversation took place. This has annoyed officials in Kabul, who see Merkel's visit as an "open affront," says one of Karzai's advisers. "In Germany it would be a scandal if we landed in Berlin without advance notice, but one can do this with us Afghans," he quipped. The mood is so frosty that Kabul is even considering making an official complaint to Berlin.

Merkel's view of Karzai is no less critical. During their last meeting, Karzai spoke at length about reforming his corrupt government, including revamping the justice system and bolstering women's rights. But virtually none of this has happened. Instead, Berlin has closely observed how Karzai attempts to control the electoral commission and forges unholy alliances with dubious warlords to secure his power base beyond the elections slated for April 2014.

All Eyes on Washington

It's not merely a lack of trust between Berlin and Kabul that is making post-withdrawal planning difficult, though. Germany's NATO partners have also been hesitant to commit to a further mission. France and Canada have stayed out completely, and among the remaining major allies it is primarily the British who are reluctant to shoulder a portion of the burden. Nevertheless, the Mongolians, Swedes and Belgians have indicated that they are willing to remain in northern Afghanistan under German leadership.

The greatest problem is Washington. The United States, which should actually assume a leading role, is mired in internal squabbling over Afghanistan. Due to his hesitation, US President Barack Obama is already the subject of ridicule in defense circles, where they say that the beginning of his second term in office is "more reminiscent of Jimmy Carter than Bill Clinton." Staff members at ISAF headquarters in Kabul are also getting nervous.

Negotiations over stationing a follow-up mission have stalled. While President Karzai indicated last week that he is prepared to tolerate American military bases even after 2014, the mid-June summit planned by leaders of NATO member countries to determine their further engagement in the country will now no longer take place.

If Obama decides against committing some 8,000 US troops, all plans for the period following the combat mission will be off, and the Germans will have little choice but to withdraw their trainers from northern Afghanistan -- leaving the Afghans to face an uncertain future on their own.

Translated from the German by Paul Cohen
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« Reply #6383 on: May 16, 2013, 06:39 AM »


May 15, 2013

After Bangladesh, Seeking New Sources

By KEITH BRADSHER
IHT

SEMARANG, Indonesia — Bennett Model helped pioneer the exporting of garments from China in 1975, the year before Mao Zedong died, and ever since, his New York fashion company has searched for other countries, from Guatemala to Vietnam to Indonesia, capable of supplying top retailers like Bergdorf Goodman and Neiman Marcus.

The relentless search for new locations has taken on more urgency after the deadliest industrial accident in the global garment industry’s history, a multistory factory collapse in Bangladesh that left 1,127 people dead. Buying from Bangladesh, said Mr. Model, “has been politically incorrect ever since problems started there, so a lot of major players had already been looking for alternatives.”

When a senior executive from one of the largest American mass-market retailers called him last week with worries about suppliers in Bangladesh and plans for a trip to Vietnam and Cambodia to seek alternatives, Mr. Model was ready with advice: “I told him to add a stop in Indonesia.”

Many Western executives are taking such trips this spring. A lethal factory fire in Bangladesh last November, 33 regional or national strikes there since January, hundreds of deaths in factional street fighting there since February, and the Rana Plaza collapse in late April have left multinational corporations scrambling for other options.

“Right now, the name of Bangladesh just gives a bad rep to a company,” said Mr. Model, the dapper chief executive of Joseph Model Associates, which designs and distributes the Annabelle New York brand of high-end apparel and also makes private-label brands for various department store chains.

Western executives are checking on potential new suppliers in southern Vietnam, central Cambodia and the hinterlands of Java in Indonesia. Yet safety problems could exist anywhere. The ceiling of a small factory that makes shoes in central Cambodia collapsed on Thursday morning, killing at least two people and injuring nine, three of them severely.

The JW Marriott Hotel in Jakarta, a favorite of Western garment buyers, is nonetheless so full these days that it is hard to book a room on short notice. Indonesian garment executives say they have seen a steady procession of arrivals in recent weeks and months, always asking the same questions about political stability, labor laws, safety compliance and wages.

“At first it was because of China getting too expensive, then came the Bangladesh fire tragedy, and then there have been so many steps in Bangladesh’s troubles,” said Ade Sudradjat, the chairman of the Indonesian Textile Association. “Some buyers feel uncomfortable placing orders in Bangladesh.”

Many multinationals are exploring their options in case street clashes and politically motivated national strikes worsen in Bangladesh, which is the world’s second-largest garment manufacturer after China. A new faction in the country’s Islamist movement has staged more violent protests lately that have sometimes resulted in the temporary closure of factories.

Garment manufacturing makes up a fifth of the economy in Bangladesh and four-fifths of its exports, which means that one of the world’s poorest, most densely populated countries is desperately dependent on continued export orders to stave off soaring unemployment and possibly further political unrest. Some executives say that many multinationals will continue buying from Bangladesh, although some may diversify their orders to more countries.

“People are on the one hand looking at contingency plans in case the unrest gets worse,” said Bruce Rockowitz, the group president and chief executive of Hong Kong-based Li & Fung, one of the world’s largest sourcing companies. “There are some people who want to move completely away from Bangladesh, but there are only a few of them.”

Tessel Pauli, a spokeswoman for the Clean Clothes Campaign, dismissed retailers’ worries about civil unrest as a disingenuous excuse to avoid improving safety standards there. “Political turmoil has been existing in Bangladesh over the last decade,” she said, while adding, “Of course, they should make it clear to the government that bloodily suppressing street demonstrations should stop immediately.”

Dozens of impoverished countries make T-shirts and other very basic clothing. But only a few countries — really just China, Bangladesh, Vietnam, Indonesia and to some extent Cambodia and Pakistan — have developed highly complex systems for producing and shipping tens of thousands or even hundreds of thousands of identical, high-quality shirts, blouses or trousers to a global retailer within several weeks of receiving an order.

The clothing needs to be labeled correctly so that it travels smoothly through a large retailer’s distribution centers and arrives on schedule at each store around the world. The process requires formidable numbers of skilled workers who can oversee quality control as well as labeling and shipping of garments. Big retailers and fashion companies have repeatedly tried and failed to develop alternatives, experimenting in India, Africa and Latin America, only to run into infrastructure bottlenecks and shortages of skilled managers or workers.

Mr. Rockowitz said that all of the potential successors to Bangladesh for very large-scale garment exports were in Asia. Mr. Model said that India was not organized for large-scale, timely production, Africa did not have enough workers with the right skills for high-volume labeling and shipping, and Latin America did not have enough workers interested in operating sewing machines.

Two years ago, Mr. Model spoke enthusiastically about a factory that he had found in Guatemala, which he saw then as an alternative to China and Southeast Asia that was much closer to the United States, which could shorten delivery times.

But Mr. Model said in a telephone interview several days ago that he recently stopped buying from the factory in Guatemala and switched his orders to two factories in Vietnam instead; he also relies on production here in Semarang for knit dresses. In Guatemala, the quality was excellent, he said, but, “They can’t handle big orders and they’re slow on delivery.”

By contrast, Mr. Model said that he had always refused to place orders in Bangladesh for his customers. He said that he and a couple of other suppliers of elite retail chains always worried about Bangladesh’s reliance on high-rise factories, in which workers can be trapped on upper floors during a fire, instead of the single-story and two-story designs found in Southeast Asia.

Indonesia, for example, has had an industry code since the early 1990s that garment factories may not be more than two stories high so evacuation will be easier during fires, volcanic eruptions and earthquakes. Union leaders here say that only a few Indonesian garment factories are taller, because they predate the rule. Even factories with a second floor in Indonesia must make sure that the second floor is open to the first floor with a long balcony or courtyard for easy escape; although there are other labor abuses in Indonesia, local union leaders said that the rule was scrupulously followed.

Rubana Huq, the managing director of the Mohammadi Group, one of the largest garment makers in Bangladesh, said that the prevalence of high-rise factories in Bangladesh reflected the country’s unusually high real estate prices combined with the difficulty of persuading utilities to install electricity and gas connections to larger sites.

What may save Bangladesh from a sharp, immediate drop in export orders is simply that most Southeast Asian factories are already fully booked with orders from multinationals fleeing China’s ever-rising costs. “For this year, it’s impossible — we’re already full,” said Suryadi Sasmita, the president of the Indonesian subsidiary of Wacoal, a big Japanese garment manufacturer.

“There are definitely customers who are looking for more capacity than we can offer them, because they want to move orders out of Bangladesh and out of China,” said Sanjay Kumar Goyal, the chief financial officer of the Busana Apparel Group, a big Jakarta-based manufacturer.

Mr. Rockowitz estimated that even if political violence escalated sharply in Bangladesh, only 10 to 20 percent of its output, or $2 billion to $4 billion a year worth of goods, could be shifted in the next nine months or so to other countries.

Indonesia’s national training center for seamstresses — women make up 98 percent of the students — is here in Semarang, producing 12,000 graduates a year. But even that isn’t enough. Four factories with a combined employment of 30,000 are to open in the next year in Semarang, and many more factories are being built nearby.

Asked how these factories would find workers, Sumidi, the school’s director, shook his head and said he hoped to send instructors to factories to train workers on sewing machines there. (Like many Javanese, he uses only one name.)

Newly opened factories have started competing for scarce seamstresses by offering free meals and free health insurance, said Nurdin Makruf, the vice general secretary of the Semarang chapter of the national union that mainly represents garment workers. Construction companies here are struggling to find enough workers to build all the garment factories now being carved out of the forests of coconut palms, banana trees and conifers that carpet central Java.

Mr. Model predicted that Bangladesh’s lock on mass retailers’ orders would erode.

“It’s going to take time, but it’s going to eventually filter out all over the place,” he said. “It’ll take two or three years.”


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« Reply #6384 on: May 16, 2013, 06:40 AM »

May 15, 2013

Bombings Kill Many Iraqis in Shiite Areas

By REUTERS

BAGHDAD (Reuters) — Bombings in Shiite areas of Baghdad and in northern Iraq killed more than 35 people on Wednesday, after weeks of violence by Sunni Islamist insurgents determined to set off sectarian confrontations.

Tensions between minority Sunni Muslims and the Shiites who now lead Iraq are at their highest since American troops pulled out in December 2011, with relations coming under more pressure by the day from the largely sectarian conflict in neighboring Syria.

A string of car bombings hit Shiite neighborhoods across Baghdad on Wednesday evening, including one outside a cafe and another at a market, killing at least 22 people and wounding dozens more, the police said.

“I saw a bright flash, followed by a strong explosion that shook the building,” said Jabar al-Rubaie, a police officer at the scene of a bombing in the Sadr City district in Baghdad. “Glass was shattered everywhere. People immediately ran to the scene and started evacuating the wounded and the dead.”

One television channel broadcast images from the city’s Zaafaraniya district, where many houses were damaged and several cars were in flames. Ambulances evacuated victims and a man ran, holding a wounded child.

Several attacks singled out police officers. At least two officers were killed in northern Baghdad when a suicide bomber on a motorcycle blew himself up near a police patrol, while a roadside bomb killed a police officer in a town near Mosul, 240 miles north of Baghdad, the police and medical workers said.

Earlier, in the ethnically mixed northern city of Kirkuk, 10 people were killed when two car bombs exploded near government buildings.

As relations between Iraq’s Shiite, Sunni and ethnic Kurds come under growing strain, the coalition government — split among Shiite, Sunni and Kurdish political blocs — is hobbled by disagreements about how to share power.

But the conflict in Syria, where mostly Sunni rebels are trying to oust President Bashar al-Assad, who follows the Alawite offshoot of Shiite Islam, has also put pressure on Iraq’s delicate intercommunal balance.

Although violence is well below the height of sectarian violence in 2006 and ’07, when tens of thousands were killed, Sunni Islamist insurgents now carry out attacks almost daily to try to undermine the Shiite-led government. Militants linked to Al Qaeda, and other Sunni insurgents, are trying to use Syria’s civil war to gain legitimacy and tap into frustrations among Iraqi Sunnis, hoping to regain ground they lost during their long battle with American troops.
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« Reply #6385 on: May 16, 2013, 06:44 AM »

India Ink - Notes on the World's Largest Democracy
May 16, 2013, 4:38 am

Delhi Gang Rape Suspect in ‘Critical Condition,’ Lawyer Says

By BETWA SHARMA

NEW DELHI — A defendant in the Delhi gang rape case has been assaulted by other inmates inside Tihar Jail in New Delhi and was being slowly poisoned by the jail authorities, his lawyer said before a local court earlier this week.

Vinay Sharma, 20, was admitted to Delhi’s Deen Dayal Upadhyay Hospital on May 4, two days after the assault, said Mr. Sharma’s lawyer, A.P. Singh. On Tuesday he was moved to the Lok Nayak Jai Prakash Narayan hospital, a more sophisticated facility in the national capital.

“He is in a critical condition,” Mr. Singh told India Ink on Thursday. “He has had blood vomiting and chest pains.”

Champa Devi, Mr. Sharma’s mother, who visited him in the hospital last week, said her son had complained of chest pain.

Hospital staff declined to comment on Mr. Sharma’s condition.

Mr. Sharma and three other men who are accused of gang raping a 23-year-old student on Dec. 16 are being held in Tihar Jail as their trial continues. A fifth defendant, a minor, is being held in a juvenile home.

Another adult defendant, Ram Singh, was found hanging in his cell inside Tihar Jail on March 11. The jail authorities said it was a suicide, but Mr. Singh’s family members insist that other inmates, with the consent of the prison guards, killed him.

The Delhi government has ordered a judicial inquiry into Mr. Singh’s death.

Vimla Mehra, director general of Tihar Jail, said Mr. Sharma’s allegations of being beaten and poisoned in jail are false. “This is all wrong reporting,” she told India Ink.

But Mr. Singh wants his client transferred out of Tihar Jail. “I have moved an application before the judge,” he said. “This should be done immediately so that he doesn’t risk Ram Singh’s fate.”

The Delhi police commissioner Neeraj Kumar has previously said that a verdict is expected by the end of May, but Mr. Singh said that the trial is not likely to conclude until the first week of July.

“End of May — no chance,” he said. “So Vinay should be kept in a safe place until the trial lasts.”

Mrs. Champa, Mr. Sharma’s mother, also expressed concern about her son’s safety inside the jail.

“They say that he is being monitored all the time on camera. But I don’t buy this,” she said. “He could easily have been beaten up where he couldn’t be seen by a camera.”

**********


India Ink - Notes on the World's Largest Democracy
March 10, 2013, 11:49 pm

Suspect in India Gang Rape Found Dead in Jail

By NIHARIKA MANDHANA and HEATHER TIMMONS

NEW DELHI — One of the men accused in the Delhi gang rape case was found dead in his jail cell on Monday morning, a jail official said.

Ram Singh, who drove the bus in which the fatal rape took place on Dec. 16, appeared to have hanged himself from a metal grille with a rope made from his clothes, a spokesman for Tihar Jail, Sunil Gupta, said in an interview.

Mr. Singh was one of five men and one teenager, including his brother Mukesh, charged with rape and murder in the death of a 23-year old physiotherapy student. The case sparked widespread protests in India and a push to increase safety for women.

Mr. Singh was the first of the accused to provide details of the attack to the police. His confession helped them track the four other men and the juvenile who have been arrested in the case.

Mr. Singh shared a jail cell with other inmates, Mr. Gupta said, and it was unclear how he may have hanged himself without attracting their attention.

“I suspect there is foul play,” said V.K. Anand, the lawyer representing Mr. Singh in the case. “There were no circumstances for committing suicide. His mental state was stable, the trial was going well, he was meeting with his family. I can’t understand why he would commit suicide.”

“This is a high-profile prisoner, and he was under special protection,” Mr. Anand added. “He was never left alone. How could this happen?”

Mr. Gupta said an inquiry had begun.



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« Reply #6386 on: May 16, 2013, 06:48 AM »

May 15, 2013

U.S. Envoy Talks With Chinese About North Korea

By BREE FENG
IHT

BEIJING — The State Department’s senior envoy on North Korea said Wednesday that he had discussed “all aspects of the North Korea issue” with Chinese officials, including sanctions on the North, during a one-day visit to Beijing.

“I think this is all a work in progress,” the diplomat, Glyn B. Davies, said at a briefing for reporters in Beijing. “The Chinese have said to us that they will faithfully implement U.N. Security Council sanctions and are doing so. And, as I’ve said before, we take them at their word."

Mr. Davies arrived in Beijing on Wednesday morning after holding talks with South Korean officials in Seoul. He will depart for Tokyo on Thursday for the final leg of his visit to the region.

His trip to China appeared to be part of an effort by the United States to work closely with Beijing to ease tensions on the Korean Peninsula after North Korea’s third nuclear test in February.

China is North Korea’s most important economic supporter, providing essential food and energy supplies that keep the North Korean government afloat. China voted for Security Council sanctions after the nuclear test, and the United States has been watching to see how carefully Beijing is enforcing them.

Mr. Davies met on Wednesday with Chinese officials, including China’s special representative on Korean affairs, Wu Dawei, who visited Washington several weeks ago. He also met with Zhang Yesui, China’s executive vice foreign minister and a former ambassador to the United States, and Liu Jieyi, vice minister of the international department of the Chinese Central Committee.

Mr. Davies played down the idea that a decision by the Bank of China to halt transfers to North Korea’s Foreign Trade Bank last week was a strong diplomatic signal by Beijing.

“I think it’s a significant step that has been taken by the bank,” Mr. Davies said. “I don’t believe this was at the direction necessarily of the Chinese government. I think this was a decision made by the bankers at the Bank of China.”

On Tuesday, one of Japan’s most experienced diplomats on North Korea, Isao Iijima, visited Pyongyang, North Korea’s capital. North Korean state television broadcast images of Mr. Iijima’s arrival in the country. The Japanese government refused to confirm Mr. Iijima’s visit.

Mr. Davies said he discussed the visit with a senior Japanese official on Wednesday but declined to comment “given the deficit of information.”
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« Reply #6387 on: May 16, 2013, 06:50 AM »


China lays claim to Okinawa as territory dispute with Japan escalates

China questions Japan's sovereignty over Ryukyu islands, heightening tension over existing Senkakus islands dispute

Justin McCurry in Tokyo
guardian.co.uk, Wednesday 15 May 2013 15.28 BST   

China is attempting to open a new front in its territorial dispute with Japan by questioning Tokyo's sovereignty over the island of Okinawa, home to 25,000 US troops.

The two countries are already pushing rival claims to the Senkakus, a chain of uninhabited islands in the East China Sea that are controlled by Tokyo. The dispute over the islands, known as the Diaoyu in China, has hit bilateral trade and sent diplomatic relations to their lowest point for decades.

Beijing began its attempt to broaden the territorial dispute earlier this month when the communist party newspaper, the People's Daily, ran an article in which two Chinese academics challenged Japan's sovereignty over the Ryukyu chain of islands, which includes Okinawa.

Luo Yuan, a two-star general in the People's Liberation Army, raised the territorial stakes again this week, saying the Ryukyus had started paying tribute to China in 1372, half a millennium before they were seized by Japan.

"Let's for now not discuss whether [the Ryukyus] belong to China, they were certainly China's tributary state," Luo said in an interview with China News Service. "I am not saying all former tributary states belong to China, but we can say with certainty that the Ryukyus do not belong to Japan," he added, in comments translated by the South China Morning Post.

The potential for more diplomatic clashes over territory comes amid fresh criticism of Japan's attitude towards its wartime conduct in China and the Korean peninsula.

Beijing reacted angrily after the outspoken nationalist mayor of Osaka, Toru Hashimoto, said this week that Japan's forced recruitment of Asian women to work in military brothels before and during the second world war had been necessary to maintain discipline among soldiers.

"We are appalled and indignant about the Japanese politician's comments boldly challenging humanity and historical justice," Hong Lei, a Chinese foreign ministry spokesman, told reporters.

"The way they treat the past will determine the way Japan walks toward the future. On what choice Japan will make, its Asian neighbours and the international community will wait and see."

On Wednesday Hashimoto attempted to clarify his remarks, saying he had not sought to justify the use of so-called comfort women, but was questioning why Japan had been singled out for criticism given that other countries had, he said, operated similar schemes.

Okinawa, an island of more than 1 million people, hosts more than half the 47,000 US troops stationed in Japan.

Washington and Tokyo have agreed to reduce Washington's military footprint on Okinawa, but the island is seen as key to the US's ability to respond quickly to maritime provocations by the increasingly robust Chinese navy, as well as a crisis on the Korean peninsula.

In their People's Daily article, Li Guoqiang and Zhang Haipeng, prominent academics at the government-run Chinese Academy of Social Sciences, said Japan's annexation of the Ryukyu kingdom in 1879 amounted to an invasion, and that the sovereignty issue remained open to question.

They pointed out that the kingdom had previously been a Chinese vassal state, adding that the ruling Qing dynasty had been too weak to resist Japan's advance.

"Hanging in the balance of history, the unresolved problem of the Ryukyus has finally arrived at the time for reconsideration," they wrote.

In a later article for the paper's sister publication, the Global Times, Li said: "Not only is Japan obliterating the truth about the Ryukyu issue, but it is doubling its aggressiveness and making provocations over the Diaoyu issue. Therefore it is necessary to revisit the Ryukyu issue."

China's foreign ministry dismissed Japanese protests over the article.

Hua Chunying, a ministry spokeswoman, told reporters that China "does not accept Japan's representations or protests". She said the article reflected renewed interest in the islands in the light of Japan's provocative actions over the Senkakus.

Japan's government effectively nationalised three of the disputed islets after buying them from their private owners last year, sparking violent protests across China and forcing the temporary closure of Japanese businesses in the country.

Okinawa, scene of one of the bloodiest battles of the Pacific war, was controlled by the US until it was returned to Japan on 15 May 1972.

The continued presence of US troops and military hardware is a constant source of tension with the civilian population, who complain about crimes by soldiers, noise pollution and the potential for accidents involving aircraft.

Analysts said China was mistaken if it believed that provoking Japan over Okinawa would add momentum to its claims to the Senkaku islands. "If China's goal is to hold talks with Japan over the Senkakus, articles like these are counterproductive," M Taylor Fravel, a Chinese foreign policy expert at the Massachusetts Institute of Technology, told Associated Press.

"As a result, Japan has an even stronger incentive now to stand firm with China and not hold talks."


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« Reply #6388 on: May 16, 2013, 06:52 AM »

New Zealand Supreme Court to hear Kim Dotcom appeal

By Agence France-Presse
Thursday, May 16, 2013 7:29 EDT

New Zealand’s Supreme Court on Thursday granted Kim Dotcom leave to appeal a ruling that US authorities do not have to disclose all of the evidence they have against the Megaupload founder.

The Court of Appeal in March had overturned a decision ordering US prosecutors to hand over the evidence to Dotcom’s legal team as they seek to extradite him to face online piracy charges.

The appeal court ruled that a summary of the case would suffice.

Dotcom’s lawyers have sought to reinstate the original decision, arguing they could not effectively fight the extradition battle without full disclosure of the evidence against their client.

The Supreme Court agreed to hear Dotcom’s legal challenge at a date yet to be set. “Leave to appeal is granted,” it said in a two-paragraph ruling.

Lawyers representing the United States had argued in the appeal court that the evidence could involve billions of emails and that full disclosure would likely delay Dotcom’s extradition hearing, scheduled for August.

The US Justice Department and FBI want Dotcom to face charges of racketeering, fraud, money-laundering and copyright theft in a US court, which could see him jailed for up to 20 years if convicted.

Dotcom is free on bail. He denies US allegations the Megaupload sites netted more than US$175 million in criminal proceeds and cost copyright owners more than US$500 million by offering pirated copies of movies, TV shows and other content.

The German national, who was arrested in an armed police raid on his Auckland mansion in January last year, launched a successor to Megaupload called Mega in January this year.


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« Reply #6389 on: May 16, 2013, 06:59 AM »


Mali offered more than €3bn in aid – with strings attached

EU-led conference agrees aid lifeline, but Europeans insist Mali must fulfil pledges to carry out democratic and social reforms

Timothy Spence and Frédéric Simon for EurActiv, part of the Guardian development network   
guardian.co.uk, Thursday 16 May 2013 12.24 BST   

An EU-led donor conference agreed on Wednesday to provide €3.25bn (£2.7bn) to fund a sweeping development plan for Mali, but European donors made clear that the interim government must live up to its promises to implement democratic and social reforms in exchange for the international lifeline.

Four months after an EU-backed French force halted an advance by militants in the country's north, the EU hosted the donor conference to help finance the Malian government's plan to improve health, education, the economy and food security. It also pledged to rebuild its impoverished northern region where skirmishes between foreign-backed government troops and militants continue.

The European commission and the 27 member states have pledged to provide €1.35bn for Mali next year, one-third of the international commitment. The pledges included €50,000 from Greece and €18m from Spain, two troubled eurozone countries that have themselves turned to Brussels for financial aid.

European leaders made clear at the Brussels meeting that the aid comes as part of broader efforts to stabilise a west African region that has endured repeated food crises, political instability and armed conflicts. A portion of the EU donations will be used for UN humanitarian and peacekeeping operations, and assistance to carry out elections, scheduled for 28 July – one of the key conditions of the aid.

The French president, François Hollande, welcomed the financial commitments but said it was up to leaders in the former French colony to follow through with its commitments. "We need transparency and good governance," Hollande said.

Earlier, the French foreign minister, Laurent Fabius, emphasised the regional dimension of the conflict, saying that "through Mali, it is the future of the subregion and beyond which is at play". But he warned that the aid provided by the international community comes with strings attached.

Fabius said particular attention would be paid to the traceability of aid and the follow-up of projects, with conditions on disbursement of funds linked to transparency, governance, democracy and the fight against corruption. The war in Mali "is being won", Fabius said but, "now we must win the peace".

Aid in stages

EU representatives repeatedly said aid must be tied to the Malian authorities' adherence to the political stabilisation roadmap (pdf, French) they presented to donors, and free elections due in July. Dirk Niebel, the German development minister, said his country would provide at least €100m in aid over the next two years. But it will be released in stages if Mali "continues to implement its roadmap … and if the transition process goes well", Niebel said.

EU development aid commissioner Andris Piebalgs said the stabilisation roadmap for Mali was the cornerstone of the international community's commitment to the country and had to be followed resolutely. He insisted that beyond Mali, "the EU's commitment is regional" and extends to the wider Sahel area.

"We are investing considerable means", he said, referring to the European commission's €524m commitment. An extra €200m is also available under the EU's strategy for the security and development of Sahel (pdf, French), the commission said. Foreign aid is expected to lead to the creation of 20,000 local jobs in the next two years in areas such as water, sanitation, justice and education, Piebalgs said.

Big boost for poor nation

The aid pledged by 108 countries and organisations is a major boost for Mali, coming a year after a brief military coup and flare-up of violence led the EU and other donors to freeze aid and ultimately back the French military operation.

Mali's foreign minister, Tieman Hubert Coulibaly, promised "effective management" of the aid. "We need money," he pleaded, adding: "Money is the sinews of war."

He said stabilising his nation would help the region, referring to the Economic Community of West African States (Ecowas), which has pledged support for a forthcoming UN peacekeeping mission in Mali. "We believe that a stable Mali is a stable Ecowas [and] a little more stable Sahel."

But the nation of 16 million faces high hurdles, including continued fighting, pressure from Islamist groups and drug traders, and refugee and food crises. Mali must also tackle its reputation for corruption and mismanagement of aid. The Business Anti-Corruption portal, an EU-funded project, reports that bribery and graft are widespread.

In 2010, the Global Fund to Fight Aids, Tuberculosis and Malaria halted funding to Mali amid allegations of fraud and mismanagement. The Global Fund has since resumed aid, and in November announced €110m in new funding.

Human rights concerns

Europe and its global partners were under pressure ahead of the conference to ensure that the Malian government address reports of extrajudicial executions, torture and reprisals carried out by government forces. Mali has been torn for decades by divisions between its northern Islamic and Arab communities and the African south. Attacks by northern insurgents, backed by regional Islamic groups, surged in early 2012, leading the military to temporarily seize control of the government.

UN rights officials and advocacy groups, including Human Rights Watch and Amnesty International, have accused insurgents and Islamic militants of pillaging and rape, while government forces have been linked to reprisals and torture. Amnesty International has accused government forces in the north of carrying out executions and Islamic rebels of recruiting child soldiers.

Positions

Justine Greening, Britain's international development secretary, pledged support to Mali and the wider Sahel through a three-year, €150m aid package. She said:

    Britain's support has been a lifeline to many over the past year, but it makes sense to work out how to prevent future shortages and help the region to become more stable. It is also firmly in the UK's national interest. The international community needs to work together to provide the long-term approach the region needs to avoid falling back into crisis.

Eloise Todd, Brussels director of development campaign group ONE:

    Today's conference was a welcome initiative from the EU and France. The European commission's pledge of €524m, nearly half of the overall EU pledge, will make an important contribution to Mali's recovery. But the big picture is that aid budgets are shrinking across much of Europe, and the EU itself is looking to freeze aid spending over the next seven years. It's becoming a zero-sum game that could mean less money to respond to other crises. EU countries need to reverse aid cuts, prioritise the world's poorest, like those in Mali, and make sure aid is targeted at the programmes that have the biggest impact on development, namely health, agriculture and education.

European commission president José Manuel Barroso:

    It is crucial that Mali's social and economic development and the consolidation of a stable state built on solid democratic foundations go hand in hand with efforts to stabilise the country. Today marks an important step forward in the social, economic and democratic renewal of Mali. By securing the pledged aid required by the country to achieve its development priorities, the international community has sent a strong signal that, collectively, we can feel proud of. This show of solidarity is crucial for all Malians and the country as a whole, the future of which concerns not only the entire Sahel region but international stability. The EU is proud to be at the forefront of these efforts.


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