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  Nation World  


 

Gold hits record highs, oil drops amid inflation fears

LONDON (AFP) – Gold prices hit record highs close to $1,500 this week while oil and base metals fell on expectations that rising global inflation risks will lead to higher interest rates and slower growth.
Gold reached record highs at the start of the week and continued higher from there to finish with an all-time peak of $1,486.07 an ounce.
Investors piled into the safe-haven precious metal amid spikes to global inflation and fresh eurozone debt worries.
“Gold hit yet another record high and silver charged to another 31-year high as inflation concerns and some fresh safe-haven investment demand pushed the precious metals still higher,” said Ian O’Sullivan, analyst at Spread Co trading group.
“The ongoing simmering European sovereign debt concerns and inflationary price pressures coming from China and the US continue to drive investors to buy the precious metals as an inflation hedge.”
Record-breaking gold will likely soar past $1,600 per for the first time later this year, driven by fears over high inflation, consultancy GFMS forecast.
Gold is a traditional safe-haven store of value in troubled times.
The metal hit its latest highs after China said inflation jumped to a 32-month high, suggesting Beijing’s efforts to rein in soaring costs are still falling short.
China’s consumer price index rose 5.4 percent year-on-year in March – the fastest pace since July 2008 and well above the government’s 2011 target of four percent – and 5.0 percent in the first quarter.
The US consumer price index rose by 0.5 percent in March, while India’s inflation rate unexpectedly accelerated while eurozone price rises ran at 2.7 percent last month, way above a 2.0 percent target.
Elsewhere, Moody’s cut its credit ratings on Ireland by two notches to just above junk status, citing an “expected decline” in government finances that is set to hamper recovery of the indebted eurozone nation.
Meanwhile, oil prices slipped of 30-month highs, weighed down by a sharp inflation rise in China, the world’s largest consumer of energy, and predictions of weaker demand.
The market also waited on weekend presidential vote in oil exporter Nigeria.
“The news from China is having a dampening effect on oil prices because the market is expecting the Chinese Government to raise (interest) rates,” following the inflation data, said Thina Saltvedt, analyst at Nordea Bank Norge.
Oil prices slumped after the International Energy Agency warned that recent high prices had started to hurt global demand for energy.
“Investor focus has finally shifted from the supply side to concerns over potential damage to demand, as highlighted by the IEA monthly report,” VTB Capital analyst Andrey Kryuchenkov told AFP.
The Paris-based IEA warned that “there are real risks that a sustained $100 dollars a barrel-plus price environment will prove incompatible with the currently expected pace of economic recovery.”
Traders are particularly concerned that rocketing prices could undermine the delicate recovery in the United States, the world’s biggest economy and the largest oil consuming nation.
Soaring oil prices have sparked fears of a return to the record levels above $147 seen in 2008.
The International Monetary Fund, meanwhile, warned this week that high oil prices were a key risk to solid global economic recovery.
Crude futures enjoyed a brief mid-week rebound as data showed stockpiles of motor fuel slumped ten times more than expected in the United States.
The US Department of Energy said that inventories of gasoline, or petrol, tumbled 7.0 million barrels last week. Analysts had forecast a much smaller drop of 700,000 barrels.
The oil market was also looking ahead to weekend elections in Nigeria, a key exporter of crude but which is regularly hit by supply disruptions owing to unrest between rebels and the African nation’s government.
“Any political unrest created from the polls in Nigeria could further increase the geopolitical risk and may retrace recent losses in the price of oil,” said Nick Campbell, an analyst at energy consultants Inenco.
The oil-producing Niger Delta region, hit by years of violence, has seen relative calm following a 2009 amnesty deal but the situation remains fragile and many have warned of a likely eventual return to unrest.


Top G20 economies face scrutiny over imbalances

WASHINGTON (AFP) – Seven of the world’s leading economies including China and the United States face deep scrutiny over fiscal and financial imbalances as the G20 group announced a new framework for assessing potential risks to the global economy.
A Group of 20 delegation member told AFP the seven “included the G5” – the United States, France, Britain, Japan and Germany – and “two big emerging countries,” suggesting China and India.
The move would boost fraternal scrutiny in the elite G20 club, underscoring the growing worry over how structural problems in one large economy can spill across the world and pull others down – as became apparent in the 2008-2009 financial crisis.
The move fell short of the “name and shame” approach some observers expected, with members apparently uncomfortable with having any official public list of those found substandard by the new G20 guidelines.
French Finance Minister Christine Lagarde, who presided over the G20 meeting would only confirm that France was one of the seven countries. But the appearance of China, the United States, Japan and Germany was expected prior to Friday’s session.
Finance officials called the meeting a solid step ahead for policing the globe’s increasingly integrated economy, when policies by the biggest players have long been decided at the national level.
US Treasury Under Secretary Lael Brainard said there were already signs of how peer pressure was being taken, citing US President Barack Obama’s speech outlining an ambitious plan to cut the massive US budget deficit, and internal discussions the Chinese are having on their side of the problem – their massive trade surplus.
“The reality is that we are in a world of sovereign states, we have national parliaments and congresses to answer to, and each country has a complicated policy process to undertake,” she said.
“You have to recognise how far this conversation has come.”
After discussions launched late last year, the G20 decided a framework for assessing the most risky economies in a “very mechanical and very objective” manner, Lagarde said.
The G20 represents 85 percent of the global economy, and comprises Britain, Canada, France, Germany, the United States, Italy, Japan, South Africa, Saudi Arabia, Argentina, Australia, Brazil, China, South Korea, India, Indonesia, Mexico, Russia, Turkey and the European Union.


Chernobyl survivor still backs nuclear energy

SINGAPORE (AFP) –
It happened a quarter of a century ago but Sergei Belyakov still remembers vividly how much he suffered from high radiation exposure after the Chernobyl nuclear plant meltdown.
“I was extremely weak, my motion senses were altered and I had difficulty breathing normally,” said the Ukrainian-born scientist, part of a Soviet clean-up crew assigned to tackle the world’s worst nuclear plant disaster.
Belyakov could not even muster the strength to play his favourite sport, basketball, for more than a year after Chernobyl and says he still suffers from the lingering effects of exposure during a 40-day stint at the stricken plant.
But as the world prepares to mark the 25th anniversary of the April 26, 1986 Chernobyl incident against the backdrop of an ongoing emergency at the Fukushima nuclear plant in Japan, Belyakov still believes in nuclear energy.
“Despite the fact that I was deeply affected personally, I still truly believe that this is the only choice for us,” he said.
“We don’t have any other choices because we are going to run out eventually of oil, we are going to run out of coal,” he told AFP.
A coin-sized patch of skin on his neck which was exposed to the air in Chernobyl has lost pigmentation, but Belyakov prefers not to talk in detail about his current health condition.
“It’s just too private. I can tell you this, I am seemingly physically OK but I am not,” said the 55-year-old naturalised American citizen now working in Singapore for AMRI, a US chemical research firm.
Japan has upgraded the Fukushima nuclear emergency to a maximum seven on an international scale of atomic crises, the first time the highest ranking has been invoked since the Chernobyl disaster.
It has been struggling to bring the emergency under control since the March 11 quake-tsunami disasters crippled the Fukushima plant’s cooling system.
The quake and tsunami killed 13,500 people and left 14,500 unaccounted for.
The way Belyakov sees it, the Chernobyl and Fukushima accidents were largely the result of human shortcomings and not problems with the technology itself.
He said France, proportionately the world’s biggest user of nuclear power with 75 percent of its energy needs met by atomic plants, was an example of how tight regulations can be effective in ensuring safety at such facilities.
“In Chernobyl, it was a human mistake and it was a design flaw, and Fukushima had its own unfortunate chain of events plus human factors once again,” said Belyakov.
Japan’s nuclear crisis has opened a floodgate of memories for Belyakov, who took up American citizenship after he emigrated to the United States in 1992.
He was 30 and teaching chemistry at a university in what was part of the then Soviet Union when he volunteered to join thousands of other people to help clean up the Chernobyl fallout.
Belyakov wrote a memoir titled “The Liquidator” in Russian based on his experience, an effort that has helped him overcome the psychological scars of his Chernobyl experience.
“That’s what psychologists recommend, if you need to get rid of it, you need to draw or write about it,” he said.
Alternatives such has hydroelectric dams, solar panels and wind turbines pale in comparison with the efficiency of nuclear energy as a substitute for the fossil fuels blamed for climate change, according to Belyakov.
He was not surprised by the upgrading of the Fukushima crisis alert.
“Looking at the pictures from the first day of the accident, you see the plumes of smoke coming out and you know it’s serious damage to the plant,” he said.
“Already, I know it’s not going to take weeks or months, it’s going to take years to clean up.”


Run-up to Britain’s royal wedding

LONDON (AFP) – A round-up of brief stories about the marriage of Britain’s Prince William and Kate Middleton on April 29:
Kate Middleton and her family will spend the night before the wedding in a five-star London hotel, St James’s Palace said.
The family have chosen to stay at the Goring Hotel, not far from Buckingham Palace.
The Edwardian hotel’s chief executive Jeremy Goring said: “We are delighted that we are able to play a small part in what’s going to be a wonderful day of celebration around Britain.
“When a guest walks through the door here they feel instantly relaxed and as if they belong.”
Kate would spend her last night as a single woman in the hotel’s luxurious royal suite costing £5,000 ($8,150/5,650 euros).
St James’s Palace, Prince William’s office, released details of the wedding day timings, which show the event has been planned with military precision.
The 1,900 guests start arriving at Westminster Abbey from 8:15am (0715 GMT), before prime ministers, diplomats, and other distinguished guests.
William and his best man, his brother Prince Harry, arrive next before foreign royals and the Middletons, then the British royals in ascending order of importance.
Finally, the bridal party arrives before Middleton and her father Michael leave the Goring Hotel at 10:51am (0951 GMT).
Well-wishers will be able to hear the service relayed along the procession route.
The service starts at 11:00am (1000 GMT) and the newlywed couple will leave at 12:15pm (1115 GMT) before Queen Elizabeth II and then the rest of the royals and other guests making up the 600 going to Buckingham Palace.
Pop star George Michael has recorded a song as a wedding gift to the couple, he revealed on his Twitter account.
The cover song, which will be free to download, took two days to record.
“It’s going to break your heart!”, the former Wham! singer said.
“I want Will and Kate to know that this a genuine gift, not a promo exercise.”
Michael, who was not invited to the wedding, said he was not “angling” for an invitation, adding the couple should be “surrounded by people they love, not dodgy ex-con pop stars.”
Two horses named William and Catherine are to take part in the celebrations, being ridden by Household Cavalry soldiers.
Catherine is said to be gentle and affectionate but can be strong-willed when she wants to be.
William is tall and described by his rider Captain James Hulme as having a good temperament and when in public knows what is expected of him.
“He holds his head very well, his carriage is very good and he’s comfortable at the trot,” Hulme said.


David Cameron’s immigration speech

Designed to emphasise coalition differences

By Alan Travis
Perhaps the most significant fact about David Cameron’s speech on immigration is that it comes only hours after Whitehall went into its traditional pre-election period of “purdah.”
With the local and devolved elections only weeks away, the speech contains no new policy developments or ideas on immigration, but that is not its purpose. Instead, it concentrates on advertising the existing state of coalition policy on immigration – or, rather, Conservative intentions about immigration.
For it is not so much a speech by a prime minister as one by a party leader in a coalition government which, going into an election campaign, is desperate to emphasise his political differences with his coalition partner, Nick Clegg.
As far as the Conservatives are concerned, there is no better issue than the populist and emotional issue of immigration to emphasise the difference with the Lib Dems, as they found during the general election leadership debates.
The Tories favour a cap to reduce net migration below 100,000, while the Lib Dems want to see an earned “amnesty” for illegal migrants who have already been here a decade. It would not be a surprise if Cameron made it a feature at the start of the local election campaigns every May between now and the general election in 2015.
So does what he says about immigration actually stack up?
• The “invasion” thesis: he says Britain went through the largest influx of people in its history between 1997 and 2009, with two million more coming to live in the UK than left to live abroad.
Cameron is trying to portray this as Labour presiding over a period of mass immigration. But if he looked a little further back in the long-term migration figures, he would see that the turning point was 1991, not 1997.
The period from 1991 – when John Major was in No 10 – to 1997 saw total net migration of 2.5 million. Looking further back, you would see that the 1970s and 1980s were decades when more people left Britain than came here.
The raw figures for 1997 to 2008 are even scarier, with six million migrants coming to live and work in Britain and four million going to live abroad.
Economists argue that migration ebbs and flows with the economic cycle and, as wars come and go, will remain a constant feature of British life that needs to be managed.
The sharp rise in immigration to Britain in the early 1990s followed the fall of the Berlin Wall and the break-up of Yugoslavia. More than 25% of the surge in migration since 2004 was accounted for by the integration of former communist countries in eastern Europe into the EU. Others say it is the inevitable consequence of globalisation.
Much of the new migration is short-term movement of seasonal workers, and could be regarded as increased labour mobility across Europe. Most people go back home after a year or two rather than settle.
• Migration has placed some communities under real pressure, creating a kind of “discomfort and disjointedness” in some neighbourhoods.
It has been recognised that some areas, such as Cambridgeshire and Lincolnshire, have been put under pressure by rapid population growth. But a £70m migration impacts fund, set up by Labour to ease the burden on schools, hospitals, councils and the Police, has been axed.
The government has also dropped the annual citizenship survey, which measures community cohesion, integration and the rise of extremism.
• The immigration cap is already working: the need to find an accommodation with the Liberal Democrats means the government has been far less tough in placing annual limits on skilled work permits and overseas student numbers than was previously envisaged.
Home Office figures show that the much-trumpeted cap on skilled foreign workers will only cut net migration – currently running at 214,000 a year – by 17,000 in its first year of operation.
Net migration is then actually forecast to rise in years two and three. Cameron says the curb on overseas students will reduce their numbers by 80,000 a year, but the Home Office has not yet published the evidence on which the figure is based.
The pledge to get net migration down below 100,000 by the next general election is, significantly, not in the coalition agreement, but is a Conservative promise.
After trying to get the numbers down through the work and student routes, ministers are now turning to those coming on family visas. Human rights legislation on the right to family life means there is little room for manoeuvre in this category.
Unless immigration falls sharply for other reasons outside the control of the government, the pledge is looking unlikely to be met.
(The Guardian)


BRICS nations against use of force in Libya

SANYA, China (AFP) – Leaders of five of the world’s major emerging powers said the use of force in Libya and the Arab world should be avoided, at a summit intended to showcase their growing global clout.
The leaders of Brazil, Russia, India, China and South Africa also warned in a joint statement that volatile commodity prices could slow the global economic recovery and that huge capital flows could hurt the developing world.
Chinese President Hu Jintao chaired the wide-ranging morning talks in the southern China resort city Sanya with South Africa’s Jacob Zuma, Brazil’s Dilma Rousseff, Russia’s Dmitry Medvedev, and Indian Prime Minister Manmohan Singh.
The leaders were seeking to present a united front as they push for their countries to have a bigger say on the world stage, particularly within the United Nations, the International Monetary Fund and other global institutions.
The five nations – which together represent more than 40 percent of the world’s population – said their unusual joint presence on the UN Security Council in 2011 offered an opportunity to work together on Libya.
“We are of the view that all the parties should resolve their differences through peaceful means and dialogue in which the UN and regional organisations should as appropriate play their role,” the leaders said in the statement.
“We share the principle that the use of force should be avoided. We maintain that the independence, sovereignty, unity and territorial integrity of each nation should be respected.”
South Africa was the only BRICS nation to approve a UN Security Council resolution establishing a no-fly zone over Libya and authorising “all necessary measures” to protect civilians, opening the door to coalition air strikes.
The other four countries have expressed concern that the NATO-led campaign – which aims to thwart Moamer Kadhafi’s assault on rebels seeking to end his 41-year rule – is causing civilian casualties.
The statement, however, did not specifically single out the NATO campaign.