From Volume 7, Issue 20 of EIR Online, Published May 13, 2008
Asia News Digest

Vietnam Will Join Rice Cartel, if Pro-Development

May 7 (EIRNS)—Vietnam can join a rice cartel if the organization ensures the interests of both Vietnam and the international community, said Deputy Minister of Industry and Trade Nguyen Cam Tu. Vietnam should ensure national food security, economic development, and the interests of rice growers, while helping increase the world's food supply and prevent food crises, he said.

Various media, including the major financial press, have charged that formation of a rice cartel would drive up prices even further, by withholding rice from the market. The critics also charge that a cartel in rice just won't work, due to the nature of the commodity: Rice planting can't be turned off like an oil spigot, the countries won't work together, rice is subject to spoilage, etc.

U.S. Troops Are Moving into Southern Afghanistan

May 5 (EIRNS)—On May 3, U.S. Defense Secretary Robert Gates said the United States could consider taking over NATO's command in southern Afghanistan, where some NATO allies have been reluctant to provide combat forces. His announcement coincided with a report by the New York Times that the Pentagon is planning to send another 7,000 troops to Afghanistan. This will bring up U.S. troop levels to 41,000 and the overall strength of foreign troops in Afghanistan, would be close to 72,000. The United States has recently increased its troop presence in Afghanistan. Some 3,500 Marines have been deployed to reinforce NATO forces in the south for seven months.

As of now, the U.S. troops function under two different commands. About 18,000 work under the U.S. Central Command, engaged in counterterrorism operations and training of Afghan troops. Another 16,000 U.S. troops work under the joint U.S.-NATO command in the eastern part of the country.

When the U.S. troops take command of southern Afghanistan, which is now under the NATO command and manned by the British, Canadian, Australian, and Dutch soldiers, U.S. troops will be deployed close to the Iranian border. The U.S. has already built an airbase in Herat, a few miles from Iran.

Cyclone's Devastation of Myanmar Will Worsen Rice Crisis

May 7 (EIRNS)—As the first estimates of the devastation of Myanmar caused by Cyclone Nargis on May 4, have begun to emerge, and while the people of Myanmar are trying to cope with their losses, the UN Food and Agriculture Organization (FAO) said that the five states of Myanmar that were the hardest hit produce 65% of the country's rice. Thus, a large amount of the Summer rice that was not yet harvested, has been lost.

The World Food Program pointed out that the immediate concern is to salvage the Summer rice that was ready to be harvested and is now under water in the flooded Irrawaddy Delta. There is no doubt that the Summer rice produced in the Pegu division, considered the rice bowl of Myanmar, will be mostly lost; its production capability of the more-important monsoon season rice is also threatened.

The Philippines-based International Rice Research Institute (IRRI)'s Beth Woods said that the situation will influence the price for rice, and that no country will go unaffected. "So, anything that knocks production and export capacity in Southeast Asia doesn't just affect Southeast Asia. It's likely to make the situation for a lot of very hungry, very poor people in Africa worse, as well," she said.

Meanwhile, at the Chicago Board of Trade, rice for July delivery rose as much as 50 cents, or 2.4%, to $21.60 per hundred pounds, on speculation that Myanmar may be transformed from a rice-exporting to rice-importing nation.

Pakistan's Economy Is in Deep Crisis

May 8 (EIRNS)—While leaders of the two major political parties in Pakistan's coalition government are making almost a last-ditch effort to prevent the collapse of the newly formed government, Pakistan's economy, which has been in deep trouble for a long while, has begun to unravel. On May 9, Finance Minister Ishaq Dar ordered a massive cut in budget expenditures across the board, including military spending, to cope with the rising cost of fuel and food subsidies. Pakistan's currency slumped to a record low against the U.S. dollar on May 2, as rising oil prices exacerbated concern about its yawning trade deficit and high inflation. The dollar was worth 69 Pakistani rupees in official inter-bank trading on May 2, compared to 67.7 rupees the previous day.

The economic crisis was triggered by the U.S. post-9/11 invasion of Afghanistan and the rise of militancy inside Pakistan, opposing Islamabad's alliance with the foreign occupiers in Afghanistan. Although Washington has pumped in about $10 billion since then to keep Islamabad afloat, the British-led insurgency operations against Islamabad in the tribal areas bordering Afghanistan, has forced Islamabad to ignore the physical economy, and spend huge sums on security.

Indian Food Consumption Going Down

May 6 (EIRNS)—Indian leaders from across the political spectrum are attacking President George Bush's statement blaming India and China for rising food prices, Voice of America reported today. Bush made the outrageous statement on May 2 that the Indian and Chinese middle classes are driving up food prices. VOA quoted Indian physicist Vandana Shiva, who is an environmentalist, saying that Indians are now eating less per capita than they did 15 years ago. Shiva said Bush made his remarks "to distract the American public. And, second, is to continue the myth of globalization, to make it look like globalization is bringing benefits to countries like India, when it's not.... Per capita consumption of food [in India] has dropped from 177 kilograms per capita per year to 152 in the last decade and a half. Instead of Mr. Bush citing that 350 million middle class, he should be citing the Indian children being denied. One million a year are dying for lack of food."

Today, Indian Finance Minister P. Chidambaram was quoted by the London Financial Times, on the question of converting food crops to biofuels: "To put it mildly, it is foolish; to put it strongly, it is a crime against humanity." Chidambaram has attacked biofuels production before. Speaking at the Asian Development Bank (ADB) meeting in Madrid, he also said that using palm oil for biofuels is a bad idea.

The VOA also reported that the Confederation of Indian Industry, representing 7,000 business entities, is setting up a task force to look into rising food costs. The CII says that biofuels, drought, and "land set-aside" subsidies are sending prices up.

Indian Defense Minister A.K. Antony called Bush's comment "a cruel joke," because U.S. biofuel policies are responsible for higher food prices. And M.A. Nagvi, vice president of India's BJP, the leading opposition party, said that Bush is shifting from his earlier role of global "bomb inspector" to world "bread inspector."

Sun Yat-sen Recalled During Hu Jintao Visit to Japan

May 7 (EIRNS)—China and Japan agreed to hold joint annual summits, during the first full day of Chinese President Hu Jintao's visit to Japan. This is the first visit by a Chinese head of state to Japan in ten years, and the second ever, after then-President Jiang Zemin's trip in 1998. Hu Jintao said his five-day trip would bring in a "warm Spring" of relations between the two nations. President Hu told a press conference today that "Prime Minister Fukuda and I believe that Sino-Japanese relations are at a new historic starting point." He praised Japan's "peaceful" role in world affairs, and in their joint statement, the leaders said that China and Japan "both share larger responsibilities for the world's peace and development in the 21st century. The leaders confirmed that the two nations are cooperative partners, not threats, to each other." It says that China "takes a positive view of the more than 60 years since the war during which Japan has developed into a peaceful state and contributed by peaceful means to the world's peace and stability."

China Daily described Prime Minister Fukuda's informal reception for President Hu yesterday evening, at the same restaurant where Dr. Sun Yat-sen, referred to as the "father of modern China" by China Daily, married his second wife, Soong Ching-ling, while Sun was in exile in Japan in 1915. Soong Ching-ling's piano is still there, among other items in an exhibition about Sun, his wife, and the restaurant's former owner.

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