Western European News Digest
European Union Declaration on Iraq Policy
What follows is the full text, from BBC, of a statement by European Union leaders issued Feb. 17 after a summit on the Iraq crisis, attended by UN Secretary General Kofi Annan. It represents a compromise, but, as German Chancellor Gerhard Schroeder stressed, it does not alter the positions of France and Germany. Important is the reference to "what the people of Europe want," as expressed in the mass demonstrations on Feb. 15.
"War is not inevitable. Force should be used only as a last resort The way the unfolding of the situation in Iraq is handled will have an important impact on the world in the next decades.
"In particular, we are determined to deal effectively with the threat of proliferation of weapons of mass destruction.
"We are committed to the United Nations remaining at the center of the international order.
"We recognize that the primary responsibility for dealing with Iraqi disarmament lies with the Security Council. We pledge our full support to the Council in discharging its responsibilities.
"The Union's objective for Iraq remains full and effective disarmament in accordance with the relevant [UN Security Council] resolutions, in particular Resolution 1441. We want to achieve this peacefully.
"It is clear that this is what the people of Europe want. War is not inevitable. Force should be used only as a last resort. It is for the Iraqi regime to end this crisis by complying with the demands of the Security Council.
"We are committed to working with all our partners, especially the United States, for the disarmament of Iraq, for peace and stability in the region, and for a decent future for all its people. We reiterate our full support for the ongoing work of the UN inspectors. They must be given the time and resources the UN Security Council believes they need.
"However, inspections cannot continue indefinitely in the absence of full Iraqi cooperation.
"This must include the provision of all the additional and specific information on the issues that have been raised in the inspectors' reports.
"Baghdad should have no illusions: It must disarm and cooperate immediately and fully. Iraq has a final opportunity to resolve the crisis peacefully.
"The Iraqi regime alone will be responsible for the consequences if it continues to flout the will of the international community and does not take this last chance.
"We recognize that the unity and firmness of the international community, as expressed in the unanimous adoption of the Resolution 1441, and the military build-up, have been essential in obtaining the return of the inspectors. These factors will remain essential if we are to achieve the full cooperation we seek.
"We will work with the Arab countries and the League of Arab Nations.
"We will encourage them, separately and jointly, to bring home to Saddam Hussein the extreme danger of miscalculation of the situation and the need for full compliance with Resolution 1441.
"We support Turkey's regional initiatives with the neighbors of Iraq and Egypt.
"In this regional context, the European Union reiterates its firm belief in the need to invigorate the peace process in the Middle East and to resolve the Israeli-Palestinian conflict. We continue to support early implementation of the roadmap endorsed by the Quartet. Terror and violence must end. So must settlement activity.
"Palestinian reforms must be speeded up and, in this respect, President Arafat's statement that he will appoint a Prime Minister is a welcome step in the right direction.
"The unity of the international community is vital in dealing with these problems. We are committed to working with all our partners, especially the United States, for the disarmament of Iraq, for peace and stability in the region and for a decent future for all its people."
Chirac Lashes Out at Gang of Eight and Vilnius 10
French President Jacques Chirac launched a blistering attack Feb. 17 on Eastern European nations who signed letters backing the U.S. position on Iraq, warning that their action could jeopardize their chances of joining the European Union. "It is not really responsible behavior," he told a news conference. "It is not well-brought-up behavior. They missed a good opportunity to keep quiet."
This riposte came in response to the actions of EU candidates Poland, Hungary, and the Czech Republic, who joined pro-U.S. EU members such as Britain, Spain, and Italy last month to form the "Gang of Eight," signing an open letter supporting Washington's line on Iraq. Paris was further upset when 10 other Eastern European nations (the "Vilnius 10") signed a similar letter a few days later.
"Concerning the candidate countries, honestly I felt they acted frivolously because entry into the European Union implies a minimum of understanding for others," Chirac told reporters after an emergency EU summit on Iraq (the statement from that summit is reproduced in full at the beginning of this DIGEST).
He warned the candidate countries that the pro-U.S. position they had taken could be "dangerous," because the parliaments of the 15 EU nations still have to ratify last December's decision to enable 10 new members to join the bloc on May 1, 2004. Chirac particularly warned Romania and Bulgaria, which are still negotiating to enter the bloc in 2007. "Romania and Bulgaria were particularly irresponsible to [sign the letter] when their position is really delicate," Chirac said. "If they wanted to diminish their chances of joining Europe"i.e., the European Union"they could not have found a better way."
Although Spanish Prime Minister Jose Maria Aznar and British Prime Minister Tony Blair were the driving forces behind the letter backing America, and EU members Italy, Denmark and Portugal also signed up, Chirac reserved his wrath for the candidates, explaining, "When you're in the family you have more rights than when you're knocking on the door."
Significantly, the Eastern European candidates were not invited to the EU summit on Iraq, at Chirac's insistence. Tony Blair sent the Eastern European countries a letter apologizing for not having been able to get them in to participate.
European Union Members Back Chirac Against Eastern European Mice
The failing British wire service Reuters on Feb. 18 ran the petulant reaction of Tony Blair and the insulted East European mouse-ministers to French President Jacques Chirac's blistering attack on the latter, under the headline, "Chirac Under Fire After EU Unites To Warn Iraq." (Chirac had blasted the Eastern European nations, the so-called Vilnius Ten, for their temerity in issuing a letter supporting the U.S. position on Iraq.)
But Reuters also paraphrased European Commission President Romano Prodi as saying the Eastern European governments, candidates for admission to the European Union, "had to realize the EU was a political union and not just an economic club, but he was sure they would get used to it."
An unnamed European diplomat is reported to have said that "Chirac's feelings were shared by some other member states, who believed the [Eastern European] candidates had been manipulated by Washington to divide Europe and marginalize France and Germany in their anti-war drive. 'Chirac expressed aloud what many feel in the Chancelleries. That they were naive enough to fall into the trap caused the discontent.'"
German Chancellor Wants Control of WMD in Other States, Too
German Chancellor Gerhard Schroeder wants control of weapons of mass destruction (WMD) to be imposed in other states, toonot just Iraqwith inspections being the priority. At a joint Berlin press conference with visiting Egyptian President Hosni Mubarak Feb. 19, Schroeder reiterated his position against war, urging intensified inspections instead.
Schroeder also said that the non-military removal of weapons of mass destruction by United Nations inspections in Iraq was a model for establishing control of such weapons potentials in other states. "International law, which is the basis for such arms inspections, applies to all nations, not just Iraq," he said, although he identified no other states, with the exception of North Korea, where Schroeder said the establishment of a new inspections regime was urgent, to help contain the crisis.
German Oriental Institute Targetted by Slanders for Its Anti-Bush Position
On Feb. 16, the new issue of the German weekly Der Spiegel attacked a leading researcher at the renowned German Oriental Institute, Iraqi-born Al Kazaz, for his views critical of the U.S.views which the Spiegel article called pro-Saddam Hussein.
At a Hamburg press conference, Udo Steinbach, director of the Institute, denounced the article and defended Al Kazaz, whom he characterized as one his "most qualified, most knowledgeable colleagues." Steinbach said that in his personal engagement for the protection of Iraq against a new war, Al Kazaz shows a "humanitarian motivation primarily," because he has been familiar with the situation of the Iraqi civilian population during the 12 years since the last Gulf War in 1991.
At an event of the Atlantic Academy Rhineland-Pfalz Feb. 17, Steinbach said that the Bush Administration wants the Iraq war by hook or by crook, for geopolitical reasons. He said that one aspect of the present U.S. approach to Iraq is the unfinished agenda of 1991, which the younger Bush inherited from his father. But he added that the real motive behind the war buildup has little to do with that, nor with Sept. 11, but rather with the geopolitical design for firm U.S. control of the combined Mideast/Gulf/Central and South Asia region. Tony Blair is sailing along with Bush, Steinbach asserted, because he is under the influence of certain Empire-minded people inside the British power apparatus who want to revise the British decision of 1967 to pull out from the Gulf, and to return to that region, to the Emirates, in some form or the other. Iraq is not even the real target, he asserted: Iran is, and the mobilization against Saddam Hussein just serves as an avenue towards the coming conflict with Iran.
Anglo-American Circles Mobilize German Assets Against Schroeder's Iraq Policy
As part of the Anglo-Americans' effort to block Gerhard Schroeder's policy for peace, not war, in Iraq, a herd of Atlanticists being trotted out with the line is: Schroeder is selling out Europe to Russia. Thus, former Chancellor Helmut Kohl warned against further strife in German-U.S. relations, saying: "If the German government further damages trans-Atlantic relations, the arithmetic of power in Europe will shift to Russia's benefit."
Historian Arnulf Baring comments: "Schroeder is swapping the Americans for the Russians, without further ado." Referring back to earlier historical periods, when Russian-German relations were close, Baring says, "Since [the end of the Cold War], the Soviet [Russian] leadership has had one aim in particular: to force the Americans out of Europe." Baring believes that European integration has already failed, since the "entrance of Russia."
A day after 500,000 demonstrated in Berlin in support of Schroeder's policy, the German newspaper of record, Frankfurter Allgemeine Zeitung, in its Feb. 16 issue came out with a front-page story, "Bio-Terror: Danger Kept Secret"a blast at the Schroeder government.The story is that last summer, the government had hard information about Iraq's possession of biological weapons, but kept it secret. Cited is a government paper from Aug. 9, 2002, which warned against a possible use of smallpox, and stated that, outside of official laboratories in the U.S. and Russia, there were also illegal caches of the virus in Russia, North Korea, and Iraq. On the basis of this paper, the Health Ministry ordered massive amounts of vaccine.
Interior Otto Minister Schily stated categorically, that the Health Ministry paper had been wrongly formulated, and that what was involved were samples of camel smallpox virus, which the Iraqis had been experimenting with in the 1990s. This was known, he said. He rejected the accusation that the government had been covering up any evidence against Saddam Hussein, saying there was no indication that the human virus could be developed out of the camel virus.
Finally, according to a Feb. 16 report in Bild am Sonntag, the Opposition is considering a "constructive vote of no confidence" against Schroeder. Christian Democratic Union deputy chairman Christoph Boehr told Bild: "Schroeder is sitting on top of a pressure cooker. He's begging for a constructive no-confidence vote" by his actions. The last Social Democratic Party parliamentary faction meeting, he said, had shown that "every vote for reason" in the SPD had been smashed. Earlier that week, CDU chief Angela Merkel had called Schroeder "a danger for the German Federal Republic," and Christian Social Union state leader Michael Glos had declared, "I think they have to gono matter how." He added, "At any democratic price." Similar statements are quoted from other regional CDU political figures.
It should be recalled that Richard Perle had told the German press that the relations between the U.S. and Germany could be repaired only under a different German government. Regime change in Baghdad, apparently, is to begin with regime change in Berlin.
Italian Finance Minister: We Need Protectionism
Speaking in Pesaro on Feb. 13, Italian Finance Minister Giulio Tremonti announced that Italy, during the coming semester of European Union chairmanship, will propose the reintroduction of import tariffs. "We must not be afraid of talking about tariffs. Maybe it is true that globalization will make all of us richer in the future. But we risk arriving there dead. We must defend Italian products."
"I realize," Tremonti said, "that the stereotype of a conservative government includes the mythology of free market. We leave this mythology to others. Maybe it is not 'politically correct,' maybe it is not 'global' or 'no global' fashion, but the Italian government intends to raise its voice on this issue also in the EU." Tremonti rejected the idea that in the era of globalization only large corporations can survive. "A small enterprise is not a fault, it is a richness." And he criticized banks which do not help small enterprises: "[Italy's] Mezzogiorno is practically the only European region without a real bank."
Meanwhile, official figures show that Italian industrial production declined 2.1% in 2002.
ThyssenKrupp Downgraded to Junk Status
Standard & Poor's on Feb. 21 announced that it has cut the long-term credit rating of Germany's largest steel producer by two notches at once, from "triple B" to BB+, a rating that belongs to "junk" territory. ThyssenKrupp stocks in the first hours after the news plunged by 7%, the risk premium on its corporate bonds almost doubled from 2.4% to 4.7%. Many investment funds in the world are not allowed to hold "junk bonds" and are now forced to sell off ThyssenKrupp corporate bonds. Any new bond emission by the company would now require the promise of much higher interest rates. The only other "junk-rated" component in the DAX-30 is Fresenius Medical Care, the producer of medical instruments and technology.
ThyssenKrupp became the first European company to be hit by a new policy at S&P regarding pension liabilities. S&P recently decided to strike out at all corporations that do not follow Anglo-Saxon orthodoxy in financing pension obligations. According to this model, a corporation has to cover future pension obligations by setting up special funds, which then invest in stocks or bonds. Most German corporations still stick to "pay-as-you-go" pension systems, and these are building special reserves for the pension obligations, backed up by fixed assets such as real estate and machines, rather than financial assets. In early February, S&P put out a list of 12 European companies which, according to the new policy, are threatened by a downgrade.
ThyssenKrupp management "strongly" criticized the S&P decision and described it as "incomprehensible." Since the last S&P rating in 2001, the company's pension obligations, about 7 billion euros, have not changed at all. At the same time, ThyssenKrupp has reduced its net debt from 7.2 billion euros to 4.9 billion euros. The company states, "The facts concerning ThyssenKrupp have not changed; the only thing that has changed is S&P's view of the way it assesses pension obligations." The management said it might take legal action against the S&P decision. However, it will not cut down on planned investments.
ThyssenKrupp is part of the consortium building the Transrapid magnetic levitation rail system in China and Germany.
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