The US ambassador to the UK, Louis Susman, caught biting the hand that feeds him, has issued this tough statement."Releasing documents of this kind place at risk the lives of innocent individuals – from journalists to human rights activists and bloggers to soldiers and diplomats. It is reprehensible for any individual or organization to attempt to gain notoriety at the expense of people who had every expectation of privacy in sharing information."

The state department condemned WikiLeaks for the release of classified material and said that the release will place lives and interests at risk.

The state department's legal adviser has written to Wikileaks founder Julian Assange and his London lawyer, warning that the cables were obtained illegally and that publication would place at risk "the lives of countless innocent individuals … ongoing military operations … and cooperation between countries".

Cables from the US embassy in Bangkok have not yet been released though there is nothing more recent than February 2010 which must come as a relief to the Thai government. Although there probably are cables about the succession issue. The Thai media will not dare cover this!

The archive of cables are a historical treasure trove. And a diplomat's nightmare! What did we learn:

1. Arab leaders were privately urging an air strike on Iran. King Abdullah of Saudi Arabia urged the United States to attack Iran to destroy its nuclear programme.One memo showed that the king told the United States to "cut off the head of the snake," and said that working with Washington to roll back Iranian influence in Iraq was "a strategic priority for the king and his government."

Some of the middle east cables are very revealing; and what is said privately is very different to the public message of Arab unity. Arab governments won't know how to react now that Wikileaks is exposing their dual positions regarding Iran, Israel and other Arab states. And the muzzled Arab media will be very measured in their coverage.

2. US officials have been instructed to spy on the UN's leadership.

3. That the US and the UK had grave fears over the security of Pakistan's nuclear weapons programme

4. The cables allege links between the Russian government and organised crime......(really - is the world round!)

5. The US was very critical of the UK's military operations in Afghanistan.

6. Their are claims of inappropriate behaviour by a member of the British royal family...(again, why would this be a surprise!)

7. China’s Politburo directed the intrusion into Google’s computer systems in that country, a Chinese contact told the American Embassy in Beijing in January, one cable reported. The Google hacking was part of a coordinated campaign of computer sabotage carried out by government operatives, private security experts and Internet outlaws recruited by the Chinese government. They have broken into American government computers and those of Western allies, the Dalai Lama and American businesses since 2002, cables said.

8. American diplomats in Rome reported in 2009 on what their Italian contacts described as an extraordinarily close relationship between Vladimir V. Putin, the Russian prime minister, and Silvio Berlusconi, the Italian prime minister and business magnate, including “lavish gifts,” lucrative energy contracts and a “shadowy” Russian-speaking Italian go-between.

9. The close relationship between the USA and the UK will be damaged by some of the dispatches from the London embassy of the US will make uncomfortable reading in Whitehall and Westminster. They range from serious political criticisms of David Cameron to requests for specific intelligence about individual MPs.

In totality the cables contain specific allegations of corruption and against foreign leaders, as well as harsh criticism by US embassy staff of their host governments, from tiny islands in the Caribbean to China and Russia. But they will not reveal much that we do not already know of suspect about international leaders: some examples - there is a reference to Vladimir Putin as an "alpha-dog", Hamid Karzai as being "driven by paranoia" and Angela Merkel allegedly "avoids risk and is rarely creative". There is also a comparison between Mahmoud Ahmadinejad and Adolf Hitler.

The cables name countries involved in financing terror groups, and describe a near "environmental disaster" last year over a rogue shipment of enriched uranium. They disclose technical details of secret US-Russian nuclear missile negotiations in Geneva, and include a profile of Libyan leader Muammar Gaddafi, who they say is accompanied everywhere by a "voluptuous blonde" Ukrainian nurse....again just one!

The big issue for Washington is that it now faces a difficult task in convincing contacts around the world that any future conversations will remain confidential.

The electronic archive of embassy dispatches from around the world was allegedly downloaded by a US soldier earlier this year and passed to WikiLeaks which has then made them available to the Guardian and four other newspapers: the New York Times, Der Spiegel in Germany, Le Monde in France and El País in Spain. All five plan to publish extracts from the most significant cables, but have decided neither to "dump" the entire dataset into the public domain, nor to publish names that would endanger innocent individuals. WikiLeaks says that, contrary to the state department's fears, it also initially intends to post only limited cable extracts, and to redact identities.

How secure was this information - apparently more than 3 million US government personnel and soldiers, many extremely junior, are cleared to have potential access to this material, even though the cables contain the identities of foreign informants, often sensitive contacts in dictatorial regimes. Some are marked "protect" or "strictly protect".

But the fact that 3million people could see these documents puts them in the public domain already. So why the surprise and shock at their release? The US argues that since the attacks of 9/11, the US government has taken significant steps to facilitate information sharing. These efforts were focused on giving diplomatic, military, law enforcement and intelligence specialists quicker and easier access to more data to more effectively do their jobs.

So why the fuss only now - when it was as long ago as the spring that 22-year-old intelligence analyst Bradley Manning was charged with leaking many of these cables, along with a gun-camera video of an Apache helicopter crew mistakenly killing two Reuters news agency employees in Baghdad in 2007, which was subsequently posted by WikiLeaks. Manning is facing a court martial. Hopefully Reuters will help with the defence costs.

Asked why such sensitive material was posted on a network accessible to thousands of government employees, the state department spokesman told the Guardian: "The 9/11 attacks and their aftermath revealed gaps in intra-governmental information sharing. "

He added: "We have been taking aggressive action in recent weeks and months to enhance the security of our systems and to prevent the leak of information."

The biggest revelations may in fact impact the Arab nations - where the reality of Gulf relations can no longer be denied. How will Iran respond to such naked Arab hostility puncturing diplomatic niceties?

Nothing earth shattering; some high quality gossip; some embarrassing revelations; some diplomatic discomfort.

But really these documents confirm what we already suspected.

The question we do need answered is who was the misbehaving royal and what did he do ?

Abhisit's last days?

29 November 2010

Hated by the reds - regarded with contempt by the yellows; Thailand's puppet Prime Minister looks like he will not be in power for much longer. Maybe not past today.

At 2pm today what is left of the constitutional court will pass judgment on whether the Democrats misused state funds in its political campaigns. The ruling Democrat Party made its closing argument this morning.Mr. Abhisit and party leaders have denied any wrongdoing.

The arguments are summarised in a graphic in the Nation newspaper which you can read here.

It is unclear which way the court will lean. It may decide to ban some party executives from politics for a maximum of five years while leaving the Democrat Party intact. The party is also accused of receiving an undeclared political contribution. The court also may choose to ban top politicians such as Mr. Abhisit and dissolve the party, or it may choose to take no action at all.

Thailand's recent political turmoil will likely weigh heavily on the outcome of the case, and the verdict could trigger more tension in this already-divided nation.

One potential outcome is that Deputy Prime Minister for security affairs, Suthep Thaugsuban, would be made acting prime minister if Prime Minister Abhisit Vejjajiva is banned from politics following the dissolution of the ruling party.

Another verdict may be a high score draw. There should be nine judges. There are now only six. A hung vote is very possible. Three of the judges have stood down after taking legal action in respect of video clips released in YouTube which allege irregularities in the court's handling of the dissolution case and the court's recruitment process for its staff.

No embarrassed resignations from these judges; just a legal case in the Criminal Court suing people that they allege are responsible for the release of the videos. Apparently caught red handed the judges sue the messenger. It is an interesting response.

The country's judicial system is accused by the Democrat Party's political opponents of being biased in favor of Mr. Abhisit's party, which broadly represents the country's traditional ruling establishment. Since a military coup ousted former populist leader Thaksin Shinawatra in 2006, the same court has taken action to bring down two populist governments and have outlawed two pro-Thaksin parties, Thai Rak Thai and the People Power Party.

One pro-Thaksin prime minister, the late Samak Sundaravej, was removed in 2008 for receiving token payments to appear on a television cooking show. Another government led by Mr. Thaksin's brother-in-law fell later that year after the Constitutional Court convicted it of electoral violations, enabling the rival Democrat Party to put together a new coalition government.

Political analysts say a court verdict to dissolve the Democrats could go a long way to easing opposition criticism about the political and judicial system being rigged in the establishment's favor.

However, dissolution likely means “the military will simply oversee another shotgun marriage of disparate political interests in a new coalition government,” PSA Asia, a Bangkok-based security and risk consulting company, said in a report today.

While Democrat leaders publicly say they have no contingency plan to cope with an adverse court verdict and expect to be exonerated, Thai observers suggest Democrat authorities have already set up a smaller party to absorb Democrat politicians and stay on as head of the ruling coalition in the event that the Democrat Party is dissolved.

Still, Thailand's powerful armed forces, which helped put the ruling coalition government together, would be taking a substantial risk by allowing such a political realignment take place, analysts say. Mr. Thaksin's supporters in the opposition might gather fresh momentum amid the confusion and refocus their challenge to the government, six months after a series of violent clashes between antigovernment protesters and troops on the streets of Bangkok earlier this year.

At least 91 people were killed in that conflict, badly tarnishing the country's international reputation and cementing deep divisions in a country badly polarized by its mostly-urban middle class and bureaucratic and military elites on one hand, and a mostly rural opposition bloc who support Mr. Thaksin and are lobbying for a greater say in how Thailand is run.
 

One year on - Dubai begins to rebuild

28 November 2010 The Independent

Sheikh Mohammed bin Rashid al-Maktoum, the ruler of Dubai, had a dream to create a city rivalling the finest in Islamic history, and spearheaded one of the most extraordinary building drives in recent memory.

Then, a year ago, one of the emirate's biggest conglomerates admitted it was struggling to pay its creditors, and it all came crashing down.

Twelve months on, signs of cautious optimism are emerging. Rodney Wilson, a professor at the Institute for Middle Eastern and Islamic Studies at Durham University, said: "Dubai had grandiose ambitions that verged on the surreal. Reality has set in now. They are not out of the woods but things look a lot better."

The emirate's government is believed to be preparing a $1.5bn Islamic bond to issue to Malaysian investors. This comes just months after its $1.2bn sovereign bond was fully taken up, in what was its first credit market activity since last November. Turker Hamzaoglu, the chief Europe, Middle East and Africa economist at Bank of America Merrill Lynch, said: "The market now believes things are getting better; we expect Dubai to issue more bonds."

Signs of a slowdown in Dubai's real estate market emerged in the middle of 2008. Yet it was an announcement on the eve of Eid al-Adha, a three-day Muslim holiday, that sent shockwaves around the global markets, prompting fears of sovereign debt default well before such talk hit Europe. Dubai World, a state-backed conglomerate, revealed that it had been unable to service its debts and had asked its creditors for a six-month grace period to get its house in order. While the problem of its $25bn debts was a commercial one, the company's close links with Dubai's ruling family immediately raised fears over the state of the emirate's finances, and whether it would default on its Islamic bond payments.

The news sent investor confidence in Dubai to an all time low and when its exchange re-opened after the holiday, the index slumped 7 per cent.

The shock announcement also raised questions over the emirate's lack of transparency, the strength of its governance controls and the relationship between the government and state-backed companies.

Sheikh Maktoum's father started plans to offset Dubai's lack of oil or natural gas by establishing a trading centre for the Middle East in the 1950s. His son's plans were more ambitious still, aiming to create a thriving financial services industry and a glamorous tourist destination. These plans included the development of Burj Khalifa, the tallest building in the world, and the Palm Islands, three artificial islands shaped like palm trees. Last year, Jim Krane, author of Dubai: The Story of the World's Fastest City, said: "When you start building a third island shaped like a palm tree, intending it to be as big and crowded as Manhattan, you are crying out for a sober voice to bark: Stop." The roots of last year's crisis came from Dubai's heavy borrowing from abroad to fund its staggering infrastructure programme.

The problems at Dubai World a year ago came from its property arm Nakheed, which was unable to service its bonds. Yet the real estate boom had already slowed, with property prices spiralling down by more than 70 per cent. Some believe prices will fall further. More than 400 projects were cancelled, and the third palm island was put on ice.

After the debt crisis hit, the International Monetary Fund downgraded its forecast for Dubai. The rating agency Standard & Poor's followed as it downgraded five state-backed companies to below investment grade.

Dubai's oil-rich neighbour Abu Dhabi stepped in with a $20bn bailout package, and it succeeded in bringing stability back to the troubled emirate. Mr Hamzaoglu said there were no longer fears that Dubai would default, and the belief was that it would will "muddle through". Analysts at Citi have estimated that the economy will grow 1.6 per cent this year.

There are still significant issues facing Dubai. BofA Merrill Lynch estimated that its loans and guarantees amounted to $150bn, $18bn of which need servicing next year.

Dubai has also suffered as all the pillars supporting its economy have been damaged in the downturn. Not just real estate and financial services, but trade, tourism and shipping have all struggled. Sheikh Maktoum is now concentrating on several key industries – including transport, retail and tourism – to drive the recovery.

One of the main problems brought on by the crisis was more intangible. Jim Krane said: "There is still an air of shame." Another big consequence, he said, was that the loss of autonomy to its neighbouring emirate had damaged the state. "Abu Dhabi has more leverage now, and that is hurting Dubai's recovery. The bail-out has cost it dearly"

Yet investors are certainly more upbeat despite the black clouds. Rob Lay, head of Europe, Middle East, and North Africa for Barings Asset Management, said: "Last year's events were a real shock, especially as it was the first time in the region." Yet appetite is back, and Barings opened a Dubai office last month. "Clients have moved beyond it. Last year was a painful process but confidence is returning and last year is increasingly seen as a blip," Mr Lay said. His optimism was reflected by the reception of the emirate's recent bond issue.

Mr Krane said: "The wild predictions from the West never came to pass. The infrastructure is there and it is a better proposition than a year ago. It still offers the best lifestyle and social freedoms and amenities in the region. Dubai stumbled badly and needs to reset its course, but this is still its game to lose."

Dubai in numbers

$112bn The total value of Dubai's debt, according to estimates from Barclays Capital. The figure equates to 140 per cent of its gross domestic product.

$31bn The debt that is due to mature in 2011 and 2012, excluding borrowing that Dubai has already arranged to restructure. Some $16bn is due next year alone.

11% The contribution of Dubai's property sector to its GDP this year, down from 14 per cent last year and 17 per cent in 2008.

-2.5% Dubai's economic growth rate during 2009, compared to an expansion of 5.7 per cent in 2008. HSBC thinks the figure this year will be 2 per cent, rising to 4 per cent in 2011.

Tiger Woods's Dubai dream evaporates in the desert

28 November 2010 - extracted from The Observer

The decline and fall of "brand Tiger Woods" is a story best told by a journey, along the Emirates Road to the south of Dubai and then left and down an unmarked road.

Drive for a mile over the speed bumps, past an abandoned security hut, until Tarmac becomes gravel and then another mile until the gravel becomes sand, and there it is: The Tiger Woods Dubai. The first golf course in world designed by the man many consider, or at least considered, the greatest ever to play the game.

Read the three-year-old press releases and gasp at the numbers. Fifty-five million square feet. Two hundred "residences" – £7m villas, £10m mansions and "palaces". A boutique hotel, a spa and a Michelin-starred restaurant. And then the centrepiece: the Al Ruwaya Golf Club. Eleven thousand imported trees; 22m cubic meters of earth to be moved; and 3m square feet of water. An 18-hole masterpiece hewn from the sand. All hail the winner of "best golf development" at the 2008 Arabian Properties Awards. Estimated total cost on completion: $1.1bn.

Now gasp at the tumbleweed reality on the morning of 27 November 2010, the first anniversary of the car crash that led to the world's richest and most famous athlete falling to earth. The Tiger Woods Dubai: a dust-bowl, an empty car park, an "Arabian palace" as real as a Hollywood film set.

Like so much else in post-boom Dubai, the palace is a facade, propped up by wooden beams. Behind it lies a collection of portable cabins that in the glory days of the economic boom served as a sales office. These days the salesmen have gone, to be replaced by a handful of cleaners and maintenance staff trying to keep alive what is left of the $1.1bn fantasy.

There is not much; a scale model of the proposed development in one of the rooms, some dusty furniture and a telephone long disconnected. What has happened to Tiger Woods Dubai? "No comment. I don't know,'' said a Dubai-based spokesman for IMG, the sports agency that represents Woods around the world, while repeated attempts to contact the Dubai Properties Group, the government-controlled company that now owns the development, are met with no response.

Six holes have been completed and the outline of 12 more are in place, all behind a fenced-off compound hidden away from public view. Ghostly fairways lined by 3,000 trees, with 8,000 more stored under canvas. Will the project ever be finished? "Who knows? It could be great if it ever gets finished, but we don't know if it will ever get finished," says one member of the staff. "They better make a decision soon because we are struggling to keep the desert at bay."

The urgency is understandable. It takes one million gallons of water a month to keep the vegetation alive – an inconsequential financial indulgence in 2008 but an unsustainable loss in these straightened times. There are options. Either abandon Tiger Woods Dubai to nature, or turn it into an exclusive golf retreat for high-rollers brought in from the downtown palaces such as the £1,500-a-night Burj al Arab. A decision is expected before February, when Woods will arrive here to play in the Dubai Desert Classic. The smart money around town is on the return to nature. After all what use is a billionaires playground when there are no billionaires?

"Why Dubai?" said Tiger Woods when asked why he had chosen to build his first golf course design in the Emirates, thousands of miles from his home in Florida and a world away from the Old Course at St Andrews, the links lay‑out designed and built by nature he has always described as his golfing lodestar. "Dubai is basically in the biggest, greatest and newest of everything."

Maybe so, but we can assume that money played a hugely significant part in the decision. Neither Woods nor his people ever discuss the vulgar subject of money, but no one in the business of golf has ever confused this reticence with modesty. In the era of the global sporting superstar, Woods was bigger than anyone. He worked hard to attain that status, was proud of it and was well aware of its worth. How much was he paid to put his name and apply his expertise to the Tiger Woods Dubai?

A figure as high as $25m was bandied around when Woods came here to launch the project in the autumn of 2008. But as time passed and Dubai's property-based economy collapsed, so the numbers have been rounded downwards. "Realistically, I have heard the fee was $10m, and not all of that was up front,'' one leading sports agent said last week. "But the real big money was in the 'back end' of the deal; the royalties he would have received from the sales. That could have run into tens of millions."

Such vast sums sound outrageous today but there was a time when Dubai gloried in the obscenity of wealth. It was willing to gamble millions to attract billions, and in that context the appropriation of the Tiger Woods brand seemed like a one-way bet. And for a short period of time it was, with the then project manager Abdulla al‑Gurg claiming in the autumn of 2008 that 35% of the development's properties – some of them priced as high as £25m – had been sold. Gurg has since left, but one member of staff who has been around since the start confirms the early successes.

"The place was buzzing. You would come in here every morning and find the sales staff had put up yet another red triangle [signifying a sale] on the map. There were always potential buyers around the place, being taken out for site visits,'' he says. The first signs of trouble came at the end of 2008, as economies around the world began to crash. Dubai's was more heavily leveraged than most and as it result it crashed harder. Properties prices fell 30% in a matter of months, while the market for high-end developments such as the Tiger Woods Dubai simply vanished.

In March 2009, it was quietly announced the scheduled opening date for the real estate side of the development had been pushed back. "We are prioritising the golfing components – the course, the clubhouse and the academy," Gurg said.

Three month's later, guardian.co.uk revealed the golf course itself was being delayed until 2010, prompting Woods into an embarrassing public loss of face. "The delay is six months as of right now,'' he said. "Obviously, the economy has turned over there and they've slowed down construction because of it. The economy needs to turn around. If it gets stimulated, we can pick up to the point where we might open earlier, but who knows? It's out of my hands."

Flying into trouble

The current death toll is close to 460 and this is likely to increase.

On the board outside a Cambodian military hospital that had taken some of the nearly 400 killed in a still-unexplained stampede at Phnom Penh's annual Water Festical, all but one of the faces was identified only by a number and letter. D10 had her eyes half-open. D09 wore a striped sweater; his face was locked in a grimace. D06 and D05 had curly hair and wore pink sweatshirts-they looked like sisters. D08 had a stream of black hair fanned out beneath her, as if she were underwater.

Only D01 -- tiny, with bangs and a polka-dotted shirt -had a name: Chhan Chhorlida.

Chhorlida's brother, Chhan Kimly, hovered over a railing near the photos, keeping a close watch on his sister's frozen face. "That's my younger sibling," he repeated several times. "I'm her older brother."

Nearby, Phan Tun pushed her way to the front of the crowd to look at the photo board. She saw what she had been dreading. "Dead, dead, they're all dead!" she shrieked into a cell phone, convulsed in tears.

The morning after a massive holiday stampede that has emerged as the deadliest peacetime disaster in modern Cambodian history, thousands of families embarked today on a grim march around Phnom Penh's hospitals, scrutinizing corpses and snapshots of corpses for the faces of their children.

There were many to see: the death toll stood at 379 when authorities stopped counting at 4 pm today, with at least 750 more injured. Cambodia's prime minister, Hun Sen, said it was the country's greatest tragedy since the Khmer Rouge, which killed millions in the 1970s.

Survivors described chaos and blinding terror at the scene of the stampede, a bridge leading to a new island development, Diamond Island. The bridge, strung with fairy lights and capped with massive fake gemstones, is formally called Diamond Bridge, but city residents have already started to refer to it as Spean Khmouch: the Bridge of Ghosts.

Diamond Island itself is home to a motley collection of attractions that can look odd to Westerners, but have come to captivate Cambodians over the past few months. In a country that claims only two playgrounds and a handful of movie theaters, the island's merry-go-rounds, ersatz Greco-Roman pergolas, ice sculptures, and electric light shows draw large crowds.

The island was packed with visitors on Monday, the last night of Cambodia's annual Water Festival, which serves the same function here as Bartholomew Fair might have in 17th-century England. Simply put: everyone comes.

This is still a nation largely made up of small-scale, far-flung rural farmers. But during the three-day festival, seemingly all of them make their way to the city. They pack themselves into convoys of makeshift trucks and trailers, often squeezing 10 or 20 to a car, doing anything and everything possible to get to the bright lights of Phnom Penh.

Many villagers spend the whole holiday camped on the banks of the Tonle Sap and Mekong Rivers watching the boat races, fireworks and pop concerts of the festival, which celebrates the end of the rainy season and the beginning of the rice harvest.

The population of Phnom Penh swells by around 3 million people during these three days, but city officials don't keep close tabs on this figure, and police rarely seem willing or able to control the crowds. They routinely accept bribes to let vehicles past roadblocks into the city's riverside area.

The crowds in Phnom Penh for Water Festival can be terrifying, almost beastlike. They often seem to move as a single body, flouting traffic laws, taking over entire boulevards, colonizing parks and pagodas, leaving massive piles of debris in their wake. That annual mayhem reached what may have been its inevitable conclusion on Monday night.

Survivors spoke of a mob packed so tight it was as if their limbs were glued together, of lying crushed beneath piles of bodies for more than four hours before rescue came. Although the timeline of events is still sketchy -- partly because it took emergency responders almost an hour to fight their way through the throngs to get to the scene -- many on the bridge reported feeling electric shocks just before the panic, or having seen others get shocked. Some said police had shocked them with batons; others said that shoddy wiring on the bridge's decorative lights had shocked them after police doused them with water.

Police have vehemently denied all these claims, and the government has mounted a vigorous response to the disaster, anticipating political backlash and serious questions over its handling of the festival's logistics. It immediately set up three committees to deal with the stampede and offered $1,200 -- a small fortune here -- to each victim's family. Even Hun Sen, a strongman who has held power here for most of the past three decades, publicly apologized.

But this was small consolation to today's mourners.

At the hospital's photograph board, Phan Tun recognized her niece, who she said had gone to Diamond Island with a cousin.

"They should not have died," she said through tears. They are young. It is the first and the most terrible and massive amount of death I've ever seen before."

Behind her, a line of people filed silently into the hospital's makeshift morgue to look for their dead. Inside, two barefoot corpses lay on the floor, a bunch of bananas and a bundle of smoldering incense set out as offerings at their feet.

Eight other bodies lay in another room, a heap of empty bottles of formaldehyde on the floor. Chheang Nhil, a medic, was injecting the preservative into each corpse so they wouldn't decompose in the tropical heat, and stuffing their mouths and noses with wads of cotton.

At Calmette Hospital, one of the city's biggest, desperate family members peered through flaps in a tent set up in the courtyard that served as a morgue for the 140 corpses that had been brought there.

Sam Pov, 43, was hovering above the body of his sister-in-law, 18-year-old Sann Ra. He displayed her national ID card and a portrait of her bright, eager face, framed by a pair of turquoise earrings. The girl's mother stood to one side, weeping wildly. Mr. Pov said both of Ra's parents had attempted suicide by jumping into the river after they discovered their daughter was dead.

Next to Ra's family, Nget Sokhoeurn kept vigil over the body of his 15-year-old nephew, Lanh Tou. He had placed a scrap of Cambodian ritual fabric over the boy's face and a bowl of rice porridge at his feet.

"I am hoping my nephew's dead soul is not going to become a hungry ghost," he explained. "The fabric is to offer him magic to go to a happy and new life."

Doctors at the hospital reported many cases of shock, severe bruising and bone fractures, especially from those who had tried to jump off the bridge in panic. Calmette was clearly struggling to handle the sudden influx of wounded, and dozens were sprawled on mats in corridors, many of them too weary or shocked to speak.

At another hospital, the emergency ward was filled with 49 survivors, twice as many anxious relatives, and the sickly-sweet fumes of ponlei, a traditional herbal remedy. In the hospital's dirt courtyard,139 corpses were being identified, packed into military trucks, and sent off en masse to their home provinces. By 1 pm, five trucks had already departed and bodies were being packed into a sixth. The hospital had the air of a bus station.

"Kompong Cham province, Kompong Cham, Kompong Cham, Kompong Cham!" authorities barked into megaphones as families waiting by bodybags began to line up and heave their corpses onto the truck.

"I don't want to cry, but I can't stop," said Chea Phearun, a heavily tattooed soldier who was mopping his eyes with his shirt. "I cannot curb my tears. The tears drop because I feel so sorry to see the bodies of a nephew and two nieces lying along here. ... They should not have died. They should have been able to grow up to lead and help their country."

Outside the hospitals, the city's streets were quieter than usual. Near the Bridge of Ghosts, which was still carpeted with the scattered shoes of the dead, crowds gathered to mourn and speculate. Many stared in disbelief, standing on motorbikes to get a better look at the empty bridge.

"This bridge should be knocked down," said 47-year-old Soum Bunna. "It has bad memories for people. A terrible thing occurred there. I used to cross it all the time, but now I don't want to cross again. I don't even want to say the name anymore."
 

Second blast ends all hope

24 November 2010

Police have confirmed there was an explosion at the Pike River coal mine on the West Coast today and they believe there is no chance of any of the 29 miners survived.

Families of the miners were told in Greymouth this afternoon there was an explosion at 2.37pm, bigger than last Friday's, and all hope was now lost.

Very sad. Families need answers - they believe the recovery effort was too slow. And a full investigation of what triggered the first explosion is needed.

Kuwait bans digital slrs

23 Septmebr 2010

It is not a country that I have much interest in visiting. And if I did visit,  I would have to leave my camera behind. As photographers in Kuwait are now facing a ban on the use of larger digital cameras in public places, according to a local media report.

Three government ministries in the Gulf state have outlawed the use of "digital SLR" (single lens reflex) cameras in public for all citizens except accredited journalists, according to the Kuwait Times.

The Ministry of Information, the Ministry of Social Affairs and the Ministry of Finance implemented the ban late last week, according to the English-language newspaper. Smaller digital cameras and mobile phones are understood to be exempt from the ban.

The government has yet to issue a statement on the reported ban.

The Kuwait Times reports: "What most Kuwaiti photographers have come to wonder is how such a decision could be reached by authorities, especially considering digital cameras and cell phone cameras have the same abilities.

Digital SLR cameras may have been targeted as "big black camera[s] tend to worry people", the newspaper said. "Taking a picture of a stranger would seem like much less of an issue if you were using a more discreet camera or even a cell phone."

All Kuwait news media must obtain licences from the Ministry of Information, which regulates the publishing industry. A 2010 report on press freedom by campaign group Reporters without Borders gave Kuwait the top ranking among all Gulf states in terms of the freedom of its newspapers, despite the convictions of a number of high-profile bloggers in recent years.

Mohamed Abdel Qader Al-Jassem, a lawyer and prominent blogger, was jailed in Kuwait City on Monday evening after being found guilty of "attacking national unity" and defaming the prime minister.
 

One year on

23 November 2010 - The Guardian

"Dubai will never be the same again. The tourists will still fill Jumeirah's golden beaches, the traffic will speed dangerously along Sheikh Zayed Road, the hedonistic bars and night clubs will still pulsate into the early hours.

But the past year has utterly changed the ethos of the glitzy Gulf emirate. The crisis that exploded a year ago has dealt a serious blow to Dubai's self-confidence and its grandiose plans to be the Middle East's financial capital.

The events triggered by what is known locally as 25/11 (ed - curious - I have never heard that term used in Dubai!) – the date on which Dubai World, the heavily indebted conglomerate, told its creditors that it could not repay about $25bn (£15.6bn) of debts as planned – will continue to have profound effects on the economic, financial and political character of the emirate.

Dubai will recover, and may even in time regain some of its swagger, but it will be a long process and the emirate that emerges at the other end will not be the same brash millionaires' playground it was in early 2007.

In February of that year, Dubai's hubris was at its peak. Sheikh Mohammed bin Rashid al-Maktoum, its ruler, forecast that by 2015, Dubai would be "an Arab city of global significance, rivalling Córdoba and Baghdad". That his benchmarks were the two urban jewels of Muslim culture at the height of the medieval Islamic empire demonstrated the scale of the ambition.

The financial crisis has dashed that vision forever. The strategy was predicated on annual growth in gross domestic product of 13.5% a year – always an ambitious target but now in the realms of fantasy.

Simon Williams, chief Middle East economist at HSBC, believes that GDP for the United Arab Emirates as a whole (Dubai is just one emirate out of seven making up the federation) fell by nearly 2.9% in 2009, and will rise by a modest 2% this year and 4.1% next. Given that most of that will be led by the oil-rich capital Abu Dhabi, it is likely that Dubai's growth will be negative this year and flat in 2011 – not the stuff of Islamic imperial dreams.

"Although Dubai's recession is probably over, we fear the economy will struggle to regain momentum this year and into 2011," Williams said. "The emirate continues to be weighed down by the excesses of earlier years."

Others are even more pessimistic. Christopher Davidson, reader in Middle East politics at Durham University and author of a study of Dubai, said: "Dubai is still very much in the midst of its crisis, as its decade-long misadventure into real estate still has a good few years to play out due to much more supply hitting the market and much more debt reservicing."

The Dubai real estate boom was fuelled by the government's decision to allow foreigners to own property in the emirate in 2002. The explosion in property prices that followed reached its peak in early 2008, when some apartment and villa prices were appreciating 10% in a week. For a country without significant reserves of oil in an energy-rich region, property became Dubai's equivalent of the black gold, driving economic growth.

Those days will probably never return. JP Morgan, the US investment bank, recently forecast that property prices would continue to fall until they bottomed out at 80% below 2008 levels. The fall is currently estimated at 50%-60% of those values. There is more pain to come in Dubai property. (ed- the fact is arriving in Dubai and and no one can upgrade because they cannot sell existing properties).

More than half of the near-1,000 real estate projects in the emirate have been cancelled, according to government statistics. Some of the big prestige developments – such as the tallest building in the world, the Burj Khalifa – have been completed or are still in progress but the bread-and-butter projects of the construction industry have been shut down. Orders for cranes, which once dominated the city's skyline, have fallen 40%.

With property in the doldrums, Maktoum has had to rethink the strategy. Now, according to the government's revised plan, the focus will be on those core activities that made Dubai a thriving commercial hub before the cheap-credit property boom: transport and logistics, the re-export business, retailing, leisure and tourism.

The role of the financial services industry in this new scheme is uncertain. If the bust of 25/11 was sparked by property, its most obvious effects were apparent in the financial sector. Overnight, liquidity dried up and credit was almost impossible to find. Credit default swap prices soared to Icelandic levels. Banks that had lavished borrowings on Dubai's corporations in the good years prepared for the inevitable hit to their balance sheets.

Dubai World's decision to appoint a chief restructuring officer (CRO) – the British accountant Aidan Birkett, hired from Deloittes – showed the interdependence between property and finance. Many of the conglomerate's big liabilities were contained within its Nakheel subsidiary, the developer of the manmade islands that include Palm Jumeirah and other "lifestyle waterside developments", which came to symbolise the emirate's brashness.

Birkett, a plain-speaking Geordie with experience of some of the biggest corporate collapses in recent British history, saw the link between property and finance early on. "Fix Nakheel, and you go a long way to fixing Dubai real estate; fix real estate, and you fix Dubai," he said.

Birkett's strategy was largely successful in persuading Dubai World's banks to play ball. Appointed on 25 November last year, by May he had secured the agreement of a majority of creditors, and in October he was able to quit the CRO role with his job done and 100% of creditors signed up to the rescheduled repayment plan for its $25bn liabilities.

But Dubai is far from out of the woods. The Dubai World debts will now be repaid in five to eight years, at lower interest rates, but those repayments still have to be met. By any measure, the emirate still has a mountain of debt.

The International Monetary Fund estimates its total indebtedness at $110bn, including the debts of central government, government-related companies such as Dubai World, and other corporations. This is about 140% of GDP – putting the emirate above Greece and Ireland in the world debt league.

Compounding Dubai's problems, much of this debt falls due in the short to medium term. Some $24bn is repayable between now and the third quarter of 2012, suggesting that a raft of restructurings – smaller than Dubai World but still onerous – are likely soon.

Dubai Holding, the conglomerate owned personally by Sheikh Mohammed, which owns the Jumeirah hotels brand as well as the emirate's once gung-ho private equity group, Dubai International Capital, sent a shiver through UAE markets just before the Eid al-Adha holiday last week with a statement that it was in talks with bankers to restructure its $12bn or so of debts. It had missed two big debt repayments, and is in serious risk of a formal default. It promises a resolution by the end of this month.

As well as rescheduling, Dubai has also said it will sell assets to repay debts. Some of these will be baubles that the emirate picked up on international markets in the boom years, from the New York retailer Barneys to the Canadian entertainment group Cirque du Soleil and the cruise-liner QE2.

Others possibly earmarked for disposal or flotation on international markets include the indigenous businesses built up as part of the core economic strategy: Jumeirah hotels, Emirates Airlines and the DP World ports and shipping group (which contains the old P&O business bought in 2006).

"Is Dubai going to sell the family silver to pay for its profligacy? That would be a big blow to its pride," said a local banker.

In particular, another branch of the UAE family might object. Abu Dhabi, the biggest emirate, which plays Washington to Dubai's New York, will want a say in the fate of these and other assets regarded as core to the UAE's global strategy. There are already plans to merge the Dubai and Abu Dhabi stock markets, and there has been open speculation about Abu Dhabi taking over Dubai's huge new airport, the modestly named Dubai World Central.

Perhaps the most significant change of the past year has been the relationship between Dubai and the far richer but more conservative Abu Dhabi. The capital bailed out Dubai with $20bn of loans at the height of the crisis. These also have to be repaid and it is likely that Abu Dhabi will ultimately want a different kind of return.

Davidson said: "For the first time in 170 years, Dubai has lost its de facto autonomy, given that its creditor and lifeline is now oil-rich Abu Dhabi, which has clear and unashamed ambitions to centralise the UAE federation and curb any autonomous macroeconomic or political activity within its borders."

Apart from the possibility of Abu Dhabi taking over Dubai's assets, this new subservience to the capital could make itself felt in two other ways, both with serious implications for Dubai: the setting of the emirate's budgets within the overall federal financial structure; and its relationship with Iran.

If Abu Dhabi set caps on the emirate's autonomous borrowing powers, it could hinder Dubai's ability to debt-finance its recovery; and if, at American urging, the capital forces Dubai to halt much of its trade with Iran, which is just across the Straits of Hormuz, it would seriously impair the role of Dubai as the region's commercial hub.

Iran is the UAE's biggest re-export partner, with trade worth about $7bn accounting for 17% of its total re-exports. Most of this goes through Dubai, and its loss would be a big blow, both financially and culturally.

Dubai still has big advantages over other would-be financial capitals in the Gulf: the region's best infrastructure, the most liberal and cosmopolitan environment of any Gulf state and a dynamic can-do ethos compared with that of other Arab countries.

But a year of living dangerously has changed all the previous assumptions. Now Dubai is getting back to basics, but with more uncertainties and less self-confidence than ever."
 

Missing the point

22 November 2010

In Bangkok in the last month, three constitutional judges were caught on film meeting with the Privy Council chairman to discuss the Tory dissolution case. They were then filmed discussing favoured court appointments.

Despite TV and news coverage the three judges do not seem to think they have done anything wrong. They would have resigned in any country where the rule of law works

Instead the three Constitution Court judges filed a lawsuit today with the Criminal Court against two people and a newspaper for defamation and violation of the Computer Crimes Act over video clips which were released on YouTube, allegedly with the intention of ruining their reputations.

Maybe a better way to help their reputation is to tell the truth, say you were misled and that lessons have been learned.

Named defendants in the lawsuit are Pasit Sakdanarong, who was dismissed as secretary to Constitution Court president Chat Cholaworn after the release of the first sets of video clips, Puea Thai Party spokesman Prompong Nopparit, and Matichon newspaper.

The judges - Jaroon Inthacharn, Supoj Khaimuk and Chalermpol Ek-uru - had lawyer Napol Arun-asirakul file the lawsuit on their behalf.

The lawsuit stated the alleged offences happened between April 26, when the Constitution Court accepted for consideration a case filed by the Election Commission seeking the dissolution of the Democrat Party for alleged misuse of the political party development fund, and Oct 29.

During that period, a group of people including Mr Pasit and Mr Prompong filmed video clips to disseminate false information to attack the Constitution Court with an intention of destroying its credibility, according to the lawsuit.

On Oct 14, the group using the login name "ohmygod3009" posted the first set of five video clips on YouTube.

The first clip was entitled "Prem [Privy Council chairman Prem Tinsulanonda] met Constitution Court judges, discussing ways of helping the Democrat Party in the dissolution case."

The second featured a meeting between Mr Pasit and Democrat MP Wirat Romyem.

The third, fourth and fifth clips featured Constitution Court judges discussing ways of making EC chairman Apichart Sukhagghanond speak in favour of the Democrat Party.

On Oct 17, Mr Prompong held a press conference to tell the public of the clips.

On Oct 29 three more video clips were posted by the same group of people on YouTube. They were aimed at implicating three judges in alleged irregularities over the recruitment of court officials.

On Oct 30 Matichon newspaper, operator of website www.matichon.co.th, ran texts of those video clips on the website and invited viewers to see the clips on YouTube.

The named defendants had defamed the judges and violated the Computer Crimes Act, the lawsuit said.

The court accepted the lawsuit for consideration.

Mining miracle unlikely in NZ

22 November 2010

After the worldwide joy at the rescue of the Chilean miners the plight of 29 Miners in New Zealand is especially sad. Four days ago an underground methane blast trapped the miners after a powerful and sustained explosion.

Toxic methane gases continue to prevent rescuers from entering the Pike River coalmine on the South Island's rugged west coast.

Hopes of finding the miners alive are fading after several setbacks including the breakdown of an exploratory robot, and the stalling of drilling a bore hole after machinery hit hard rock.

There are safe areas in the mine that have access to oxygen. But there has been no communication with the miners since the explosion. Rescue teams still cannot enter the mine due to toxic gas levels.

Euro crisis?

22 November 2010

First is was the Euro110bn bailout of Greece. Now we have Euro90 billion bail out of the Irish.

Neither deal will stem concerns about the eurozone.

The rescue of Greece proved ineffectual in stopping contagion; similarly the aid package for Ireland will not prevent further deterioration of the sovereign debt crisis.

One commentator noted that "the markets are moving faster than the European politicians can keep up with."

Stock markets across Europe tumbled. Spain's Ibex index was off 2.7%, Italy was down 1.2% and Ireland closed 1.4% while the FTSE was down 52 – about 1% – at 5680.

Analysts use the cost that the markets charge to insure against a country defaulting on its debt as an indicator of distress. The cost of buying insurance on Portuguese debt rose and while Ireland initially enjoyed a reduction in its insurance costs, these had increased again by the end of the day. Ratings agency Moody added to the gloom by saying that it might cut the country's credit rating by more than previously.

More market volatility is expected while the Irish package is still being negotiated and not expected to be finalised before the end of the month.

The likelihood of an Irish election in early 2010 will make lenders feel even less confident.

It started with Greece, Ireland was next; and what or who will follow - Portugal and Spain?
 

Never a truer word

22 November 2010

Never a truer word. This is a grab from today's Bangkok Post web site. The PAD is re-branded as the Peoples Alliance Against Democracy. Which may be a typing accident but it is exactly what it is ! This is a group that believes that most Thais are not smart enough to make decisions for themselves. A group that wants the wealth of the nation to be shared among a non elected elite.

Parliament locked down

No Thai Christmas for Camerons

21 November 2010

The Independent on Sunday is reporting that David Cameron will cancel a planned family holiday to Thailand this Christmas. The Independent argues that the cancellation follows complaints from campaigners about the country's human-rights record.

BUt it may be more to do with Cameron's domestic issues in the UK. A Thai holiday might not look so good given the UK's austerity measures and spending cuts.

The Prime Minister had faced claims that the trip would be viewed as "showing support" for a "brutal" regime. The United Front for Democracy Against Dictatorship – known as the Red Shirts – has submitted abuse claims to the International Criminal Court. More than 90 protesters were killed in angry clashes in Bangkok earlier this year, as the government moved to crack down on the demonstrations.

Downing Street said it would not comment on the Camerons' plans, but it is understood that the family had booked flights some time ago and now felt it was better to enjoy the festive season in England. It had been reported that Mr Cameron chose Thailand because the Thai Prime Minister, Abhisit Vejjajiva, is a fellow Old Etonian – something that No 10 denies.

This summer the Camerons holidayed in Cornwall, a break interrupted by the early birth of their daughter Florence.

There must be some disappointed media types who were all hoping to follow Cameron for an all expenses paid Christmas trip to Thailand.

In China's Orbit

20 November 2010 The Wall Street Journal - Niall Ferguson

"We are the masters now." I wonder if President Barack Obama saw those words in the thought bubble over the head of his Chinese counterpart, Hu Jintao, at the G20 summit in Seoul last week. If the president was hoping for change he could believe in—in China's currency policy, that is—all he got was small change. Maybe Treasury Secretary Timothy Geithner also heard "We are the masters now" as the Chinese shot down his proposal for capping imbalances in global current accounts. Federal Reserve Chairman Ben Bernanke got the same treatment when he announced a new round of "quantitative easing" to try to jump start the U.S. economy, a move described by one leading Chinese commentator as "uncontrolled" and "irresponsible."

"We are the masters now." That was certainly the refrain that I kept hearing in my head when I was in China two weeks ago. It wasn't so much the glitzy, Olympic-quality party I attended in the Tai Miao Temple, next to the Forbidden City, that made this impression. The displays of bell ringing, martial arts and all-girl drumming are the kind of thing that Western visitors expect. It was the understated but unmistakable self-confidence of the economists I met that told me something had changed in relations between China and the West.

One of them, Cheng Siwei, explained over dinner China's plan to become a leader in green energy technology. Between swigs of rice wine, Xia Bin, an adviser to the People's Bank of China, outlined the need for a thorough privatization program, "including even the Great Hall of the People." And in faultless English, David Li of Tsinghua University confessed his dissatisfaction with the quality of Chinese Ph.D.s.

You could not ask for smarter people with whom to discuss the two most interesting questions in economic history today: Why did the West come to dominate not only China but the rest of the world in the five centuries after the Forbidden City was built? And is that period of Western dominance now finally coming to an end?

In a brilliant paper that has yet to be published in English, Mr. Li and his co-author Guan Hanhui demolish the fashionable view that China was economically neck-and-neck with the West until as recently as 1800. Per capita gross domestic product, they show, stagnated in the Ming era (1402-1626) and was significantly lower than that of pre-industrial Britain. China still had an overwhelmingly agricultural economy, with low-productivity cultivation accounting for 90% of GDP. And for a century after 1520, the Chinese national savings rate was actually negative. There was no capital accumulation in late Ming China; rather the opposite.

The story of what Kenneth Pomeranz, a history professor at the University of California, Irvine, has called "the Great Divergence" between East and West began much earlier. Even the late economist Angus Maddison may have been over-optimistic when he argued that in 1700 the average inhabitant of China was probably slightly better off than the average inhabitant of the future United States. Mr. Maddison was closer to the mark when he estimated that, in 1600, per capita GDP in Britain was already 60% higher than in China.

For the next several hundred years, China continued to stagnate and, in the 20th century, even to retreat, while the English-speaking world, closely followed by northwestern Europe, surged ahead. By 1820 U.S. per capita GDP was twice that of China; by 1870 it was nearly five times greater; by 1913 the ratio was nearly 10 to one.

Despite the painful interruption of the Great Depression, the U.S. suffered nothing so devastating as China's wretched mid-20th century ordeal of revolution, civil war, Japanese invasion, more revolution, man-made famine and yet more ("cultural") revolution. In 1968 the average American was 33 times richer than the average Chinese, using figures calculated on the basis of purchasing power parity (allowing for the different costs of living in the two countries). Calculated in current dollar terms, the differential at its peak was more like 70 to 1.

This was the ultimate global imbalance, the result of centuries of economic and political divergence. How did it come about? And is it over?

As I've researched my forthcoming book over the past two years, I've concluded that the West developed six "killer applications" that "the Rest" lacked. These were:

• Competition: Europe was politically fragmented, and within each monarchy or republic there were multiple competing corporate entities.

• The Scientific Revolution: All the major 17th-century breakthroughs in mathematics, astronomy, physics, chemistry and biology happened in Western Europe.

• The rule of law and representative government: This optimal system of social and political order emerged in the English-speaking world, based on property rights and the representation of property owners in elected legislatures.

• Modern medicine: All the major 19th- and 20th-century advances in health care, including the control of tropical diseases, were made by Western Europeans and North Americans.

• The consumer society: The Industrial Revolution took place where there was both a supply of productivity-enhancing technologies and a demand for more, better and cheaper goods, beginning with cotton garments.

• The work ethic: Westerners were the first people in the world to combine more extensive and intensive labor with higher savings rates, permitting sustained capital accumulation.

Those six killer apps were the key to Western ascendancy. The story of our time, which can be traced back to the reign of the Meiji Emperor in Japan (1867-1912), is that the Rest finally began to download them. It was far from a smooth process. The Japanese had no idea which elements of Western culture were the crucial ones, so they ended up copying everything, from Western clothes and hairstyles to the practice of colonizing foreign peoples. Unfortunately, they took up empire-building at precisely the moment when the costs of imperialism began to exceed the benefits. Other Asian powers—notably India—wasted decades on the erroneous premise that the socialist institutions pioneered in the Soviet Union were superior to the market-based institutions of the West.

Beginning in the 1950s, however, a growing band of East Asian countries followed Japan in mimicking the West's industrial model, beginning with textiles and steel and moving up the value chain from there. The downloading of Western applications was now more selective. Competition and representative government did not figure much in Asian development, which instead focused on science, medicine, the consumer society and the work ethic (less Protestant than Max Weber had thought). Today Singapore is ranked third in the World Economic Forum's assessment of competitiveness. Hong Kong is 11th, followed by Taiwan (13th), South Korea (22nd) and China (27th). This is roughly the order, historically, in which these countries Westernized their economies.

Today per capita GDP in China is 19% that of the U.S., compared with 4% when economic reform began just over 30 years ago. Hong Kong, Japan and Singapore were already there as early as 1950; Taiwan got there in 1970, and South Korea got there in 1975. According to the Conference Board, Singapore's per capita GDP is now 21% higher than that of the U.S., Hong Kong's is about the same, Japan's and Taiwan's are about 25% lower, and South Korea's 36% lower. Only a foolhardy man would bet against China's following the same trajectory in the decades ahead.

China's has been the biggest and fastest of all the industrialization revolutions. In the space of 26 years, China's GDP grew by a factor of 10. It took the U.K. 70 years after 1830 to grow by a factor of four. According to the International Monetary Fund, China's share of global GDP (measured in current prices) will pass the 10% mark in 2013. Goldman Sachs continues to forecast that China will overtake the U.S. in terms of GDP in 2027, just as it recently overtook Japan.

But in some ways the Asian century has already arrived. China is on the brink of surpassing the American share of global manufacturing, having overtaken Germany and Japan in the past 10 years. China's biggest city, Shanghai, already sits atop the ranks of the world's megacities, with Mumbai right behind; no American city comes close.

Nothing is more certain to accelerate the shift of global economic power from West to East than the looming U.S. fiscal crisis. With a debt-to-revenue ratio of 312%, Greece is in dire straits already. But the debt-to-revenue ratio of the U.S. is 358%, according to Morgan Stanley. The Congressional Budget Office estimates that interest payments on the federal debt will rise from 9% of federal tax revenues to 20% in 2020, 36% in 2030 and 58% in 2040. Only America's "exorbitant privilege" of being able to print the world's premier reserve currency gives it breathing space. Yet this very privilege is under mounting attack from the Chinese government.

For many commentators, the resumption of quantitative easing by the Federal Reserve has appeared to spark a currency war between the U.S. and China. If the "Chinese don't take actions" to end the manipulation of their currency, President Obama declared in New York in September, "we have other means of protecting U.S. interests." The Chinese premier Wen Jiabao was quick to respond: "Do not work to pressure us on the renminbi rate…. Many of our exporting companies would have to close down, migrant workers would have to return to their villages. If China saw social and economic turbulence, then it would be a disaster for the world."

Such exchanges are a form of pi ying xi, China's traditional shadow puppet theater. In reality, today's currency war is between "Chimerica"—as I've called the united economies of China and America—and the rest of the world. If the U.S. prints money while China effectively still pegs its currency to the dollar, both parties benefit. The losers are countries like Indonesia and Brazil, whose real trade-weighted exchange rates have appreciated since January 2008 by 18% and 17%, respectively.

But who now gains more from this partnership? With China's output currently 20% above its pre-crisis level and that of the U.S. still 2% below, the answer seems clear. American policy-makers may utter the mantra that "they need us as much as we need them" and refer ominously to Lawrence Summers's famous phrase about "mutually assured financial destruction." But the Chinese already have a plan to reduce their dependence on dollar reserve accumulation and subsidized exports. It is a strategy not so much for world domination on the model of Western imperialism as for reestablishing China as the Middle Kingdom—the dominant tributary state in the Asia-Pacific region.

If I had to summarize China's new grand strategy, I would do it, Chinese-style, as the Four "Mores": Consume more, import more, invest abroad more and innovate more. In each case, a change of economic strategy pays a handsome geopolitical dividend.

By consuming more, China can reduce its trade surplus and, in the process, endear itself to its major trading partners, especially the other emerging markets. China recently overtook the U.S. as the world's biggest automobile market (14 million sales a year, compared to 11 million), and its demand is projected to rise tenfold in the years ahead.

By 2035, according to the International Energy Agency, China will be using a fifth of all global energy, a 75% increase since 2008. It accounted for about 46% of global coal consumption in 2009, the World Coal Institute estimates, and consumes a similar share of the world's aluminum, copper, nickel and zinc production. Last year China used twice as much crude steel as the European Union, United States and Japan combined.

Such figures translate into major gains for the exporters of these and other commodities. China is already Australia's biggest export market, accounting for 22% of Australian exports in 2009. It buys 12% of Brazil's exports and 10% of South Africa's. It has also become a big purchaser of high-end manufactured goods from Japan and Germany. Once China was mainly an exporter of low-price manufactures. Now that it accounts for fully a fifth of global growth, it has become the most dynamic new market for other people's stuff. And that wins friends.

The Chinese are justifiably nervous, however, about the vagaries of world commodity prices. How could they feel otherwise after the huge price swings of the past few years? So it makes sense for them to invest abroad more. In January 2010 alone, the Chinese made direct investments worth a total of $2.4 billion in 420 overseas enterprises in 75 countries and regions. The overwhelming majority of these were in Asia and Africa. The biggest sectors were mining, transportation and petrochemicals. Across Africa, the Chinese mode of operation is now well established. Typical deals exchange highway and other infrastructure investments for long leases of mines or agricultural land, with no questions asked about human rights abuses or political corruption.

Growing overseas investment in natural resources not only makes sense as a diversification strategy to reduce China's exposure to the risk of dollar depreciation. It also allows China to increase its financial power, not least through its vast and influential sovereign wealth fund. And it justifies ambitious plans for naval expansion. In the words of Rear Admiral Zhang Huachen, deputy commander of the East Sea Fleet: "With the expansion of the country's economic interests, the navy wants to better protect the country's transportation routes and the safety of our major sea-lanes." The South China Sea has already been declared a "core national interest," and deep-water ports are projected in Pakistan, Burma and Sri Lanka.

Finally, and contrary to the view that China is condemned to remain an assembly line for products "designed in California," the country is innovating more, aiming to become, for example, the world's leading manufacturer of wind turbines and photovoltaic panels. In 2007 China overtook Germany in terms of new patent applications. This is part of a wider story of Eastern ascendancy. In 2008, for the first time, the number of patent applications from China, India, Japan and South Korea exceeded those from the West.

The dilemma posed to the "departing" power by the "arriving" power is always agonizing. The cost of resisting Germany's rise was heavy indeed for Britain; it was much easier to slide quietly into the role of junior partner to the U.S. Should America seek to contain China or to accommodate it? Opinion polls suggest that ordinary Americans are no more certain how to respond than the president. In a recent survey by the Pew Research Center, 49% of respondents said they did not expect China to "overtake the U.S. as the world's main superpower," but 46% took the opposite view.

Coming to terms with a new global order was hard enough after the collapse of the Soviet Union, which went to the heads of many Western commentators. (Who now remembers talk of American hyperpuissance without a wince?) But the Cold War lasted little more than four decades, and the Soviet Union never came close to overtaking the U.S. economically. What we are living through now is the end of 500 years of Western predominance. This time the Eastern challenger is for real, both economically and geopolitically.

The gentlemen in Beijing may not be the masters just yet. But one thing is certain: They are no longer the apprentices.

Six months on

19 November 2010

The red shirts are back rallying in Bangkok; it is exactly six months since the 19 May crackdown that saw over 90 people killed on the streets of Bangkok as troops were used to clear the red shirt camps around Siam and Ratchaprasong.

On the surface the country is quiet; people are shopping in BKK; tourists are back; the baht is booming; the red shirt leaders are in detention or hiding; the government has not fallen; central world has re-opened.

Scratch away the surface and all is not as well. The CRES still appears to determine government policy; There are occasional bomb and grenade attacks in Bangkok; there is a new hard line army commander; lese majeste cases continue on the thinnest of evidence; internet censorship has extended to cover anything that might be seen as pro-red and anti government. And, sadly, after 14 months the King remains in hospital; presumably either not well enough, or not willing, to return to the Palace.

The PAD - yellow shirts - are also determined to rally from 23-25 November.

The latest gem from the CRES is to order a ban of subversive goods within Bangkok and adjacent provinces still under an official State of Emergency. The ban includes clothing and all consumer goods deemed objectionable. Who decides what is objectionable? The ban is apparently in response to the latest red shirt rallies. Clothing and other accessories sold at these rallies including flip flops with the face of PM Abhisit on them. 

Bangkok and other provinces have been under emergency rule since April 7. This represents the longest State of Emergency in Bangkok in more than a quarter century. (Prior to this, after the Thammasat Student Massacre of 1976 the Thai military maintained a State of Emergency in Bangkok for nearly 8 years, until 1984.)

Interesting that the CRES can make law.

Anyway this is a translated excerpt from the ban, which is in effect immediately:

Item 1: Individuals are forbidden to have in their possession, or possess with intent to sell or otherwise distribute, products, clothing, consumer goods, or any other objects that contain printing, writing, drawing, photography, or any other method that conveys a meaning which provokes, incites, agitates, or causes disunity in the general populace, or acts or supports acts which cause a state of emergency.

Item 2: Authorities are authorized to order the seizure or confiscation of products, clothing, consumer goods, or any other objects as outlined in Item 1, and are authorized to act as necessary to maintain the security of the state or the safety of the public.

Item 4: Any person violating this order is subject to up to 2 years imprisonment or a fine of up to 40,000 baht, or both.

Thaksin meanwhile has been quiet; but that does not mean he has disappeared. It will probably remain quiet until after the Kings birthday. After that, all bets are off.

Willy and Katie to wed

16 November 2010

The will he, wont he propose debate is over. Prince William, for those who live on Mars he is the second in line to the English throne, proposed to commoner Kate Middleton and they will marry in the spring or summer next year.

Another Royal Wedding. The news networks are already talking about nothing else. CNN, BBC, Sky; it is royal wedding tv. And we have months more of the same.

They will marry in 2011; thirty years after Charles and Diana married - and that was watched by one billion people around the world. Not by me. I went to play golf with my Dad.

Jim Clancy on CNN tweeted - "Aung San Suu Kyi represents a much more striking individual image to me than any member of royalty." Well done Mr. Clancy. The sad thiing is that Aung San Suu Kyi has already disappeared from the news.

In the UK both the BBC News channel and Sky News devoted their entire schedule to the couple today following the marriage announcement by Clarence House, with BBC1 also interrupting its normal programming to bring viewers the big news.

Good luck to the couple; but do we all have to switch off from the real world to follow this spoon in mouth couple.

Maybe they could just get married quickly tomorrow and save us from months of tv hell.

Or how about a sponsored wedding - someone could sponsor the dress; put advertising in the church; sponsor the choir, the page boys, the wedding carriage or the organ (the musical one)?  

Qatar could buy the royal wedding : they already own a list of blue-chip British investments which currently includes Harrods, the (soon to be former) US Embassy in Grovesnor Square, Canary Wharf, Chelsea Barracks, the Shard at London Bridge, shares in the LSE, Barclay’s Bank and Sainsbury’s.

Or maybe Emirates could sponsor the wedding as the logo would look good on the dress!

Brits, mired in a recession and reeling form deep budget cuts, will now all be expected to join merrily in the festivities. The government will expect a huge benefit from the wedding feel good factor.

And you will be able to but William and Kate everything.

For Kate Middleton, her life as she knew and enjoyed it, has just ended. She will be the wife of the future King. And her every move and every statement is now open to public scrutiny.

Nice touch - the engagement ring is the ring that Charles gave to Diana thirty years ago.

Other than that. Can we move on to real news please.

Here we go again

16 November 2010

Dubai has not learned its pr lesson. And that is sad.

You don#t make major financial announcements at the start of an extended government holiday.

But it was announced to day - the Eid holiday - that the Dubai government has pumped $2bn (two billion dollars) into Dubai Holding, taking control of the conglomerate's financial restructuring.

Mohammed Al Shaibani, director of the Ruler's Court, the body that coordinates the activities of government departments, told the Financial Times that  the government  is willing to put more capital into the loss-making conglomerate.

The government also expects banks to accept some of the pain, as was the case in the Dubai World restructuring, Shaibani told the newspaper in an interview.

He said banks could expect to win advisory deals as the government considered future asset sales and privatisations. But they will have to give up money they are owed in order to get those deals.

Dubai Holding, controlled by the emirate’s ruler Sheikh Mohammed Bin Rashid Al Maktoum, apparently owes banks about $12 billion. Almost three- quarters of its debt has been racked up by Dubai International Capital and Dubai Group LLC. Dubai Holding has stakes in U.K.-based hotel chain Travelodge Hotels Ltd, Doncasters Plc and Madame Tussauds, through DIC and Dubai Group.

Dubai’s government had outstanding direct debt of 105.47 billion dirhams ($29 billion) at the end of July, according an updated bond prospectus published on the London Stock Exchange on Sept. 27. The debt includes funds borrowed to finance the expansion of Dubai International Airport, other infrastructure projects, borrowings by Investment Corp. of Dubai, and loans from the Abu Dhabi government and the Central Bank of the United Arab Emirates, the document showed.

Of course no one from the Dubai government was immediately available to comment as today is the Islamic feast of Eid Al Adha.

Reuters cameraman Hiro Muramoto may have been shot by Thai security forces when he was killed during a street protest in April, state investigators said on Tuesday, calling for a new probe into his death.

The statement is the first by Thai investigators to acknowledge that a bullet fired by security forces may have killed the 43-year-old journalist.

"Since there was possible involvement by government officers, we have to start from square one by letting police investigate further," Tharit Pengdith, director general of the Department of Special Investigation, told a news conference.

So what exactly have investigators been doing since April - that is 7 months ago.

Muramoto, a Japanese national based in Tokyo with Thomson Reuters, was killed by a high-velocity bullet wound to the chest while covering clashes in Bangkok between anti-government protesters and Thai troops on April 10.

"I hope the investigation can be completed swiftly so that all who care deeply about Hiro Muramoto's death can have clarity about what precisely happened, David Schlesinger, editor-in-chief of Reuters, said in a statement.

"His family and colleagues need to know who was involved and what the circumstances were that led to this tragedy."

Twenty-five people, mostly protesters, were killed on April 10 and hundreds wounded. Television footage showed Thai troops opening fire on protesters, while soldiers came under attack from grenades and black-clad gunmen moved among the demonstrators.

The DSI said Muramoto was among six people whose deaths will be further investigated because it was unclear if he was shot by security forces, protesters or unidentified "armed militants."

The DSI has yet to release findings from its investigation into Muramoto and others killed on April 10 including the source of gunfire, despite intense diplomatic pressure from Japan. It previously said the probe lacked conclusive witness accounts.

"We have been asking the Thai government at all levels, including in meetings between our foreign ministers and through our embassy, to find out the truth," a Japanese foreign ministry official said. "We will continue to call for the truth into what happened with Mr. Muramoto."

A Thai newspaper reported in July that four witnesses told police Muramoto was killed by gunfire from troops, but the DSI denied the report, saying it did not have reliable witnesses to the shooting.

The New York-based Committee to Protect Journalists said in July that Thailand's government had failed to properly investigate the deaths of Muramoto and Italian freelance photographer Fabio Polenghi who was shot dead on May 19 as troops moved in on protesters in Bangkok's commercial district.

The DSI said on Tuesday that it had evidence that 12 people including seven soldiers were killed by supporters of an anti-government "red shirt" protest movement demanding Prime Minister Abhisit Vejjajiva call fresh elections.

A senior police official who asked not to be identified because of the sensitivity of the issue told Reuters on Tuesday that Muramoto was likely caught in a crossfire and there was a "high possibility" that he was shot by the security forces although the case remained inconclusive.

"Given the line of fire and eyewitness accounts, there is a high possibility but this is in no way conclusive which is why we need further investigation," the official said.

The Thai authorities will delay the investigation for as long as they can but I do not expect either Reuters or the Japanese government will drop their pursuit of a full, thorough and evidenced investigation.

JetBlue joins up with Emirates

14 November 2010

 JetBlue Airways is teaming up with Emirates Airline in a deal under which the pair will sell tickets on each other's flights.

The deal announced Monday allows U.S. passengers to buy tickets through JetBlue to international destinations that Emirates serves. Emirates customers can buy tickets to U.S. cities JetBlue serves.

Emirates flies two daily nonstop flights from New York to its hub in Dubai.

JetBlue Airways Corp. already has similar deals with American Airlines, South African Airways and Irish carrier Aer Lingus. These partnerships allow airlines to expand their available destinations without added costs. They also feed more passengers into their respective networks.

What makes this deal interesting is that Lufthansa is a shareholder in JetBlue but the US airline will be routing its passengers onto Emirates flights not those of its shareholder or Star Alliance partner.

Can't get to Canada so try Basra

13 November 2010

Effective 2 February 2011, Emirates will commence flights to Basra (BSR) in Iraq. Flights will be operated 4x weekly (Mon, Wed, Thu, Sat) using A330-200. The schedule is:

EK945 DEP DXB 1345 ARR BSR 1445
EK946 DEP BSR 1615 ARR DXB 1910

I am surprised that Emirates will commence flights to Basra in the south of Iraq rather than to Baghdad. EK was planning to start Baghdad. Maybe a year ago. Wonder what hppaned to those plans.  EK must be planning to attract many business travelers from the south east of the country. Nevertheless it is an interesting move confirming the airline's ambitions to grow in this country.

And why Basra - oil. Which appears to be transforming the city.

Basra in southern Iraq has been transformed - thanks to oil

Emirates takes on Canada

13 November 2010 - updated 14 November 2010

Emirates has gone on the public relations offensive in its battle to obtain additional landing rights in Canada. The airline has issued a two-page backgrounder for public and media use It is called "Canada and Emirates Airline. Busting Myths. A reasonable request."

Emirates actually hired public relations firm Temple Scott Associates Inc, which specializes in government relations, to do the myth busting for them. Proof as always, that you can write anything if you get paid for it!

It was the the PR firm that issues the two-page press release.

The documents can be read here. There is more here from Emirates Public Affairs - Emirates and Canada

Scattered throughout are selective quotes from major players meant to back up Emirates' position, including British Airways CEO Willie Walsh and WestJet CEO Gregg Saretsky.

Ultimately, Emirates accuses Air Canada of trying "to deny choice to Canadian consumers and protect itself from fair and reasonable competition."

In a statement on October 12, Air Canada said the current agreement between Canada and the U.A.E. "allows more than enough capacity to carry all the point-to-point traffic" between the two countries.

"Air Canada supports liberalization in markets where such agreements benefit both sides, such as with the U.S. and Europe, but opposes capacity dumping by state-owned airlines," the statement said.

The trouble is the more that Emirates protests the less inclined I am to listen. And I suspect the Canadian authorities feel the same way.

My concerns with the Emirates publicity drive are as follows, in no particular order.

1. The document talks about Emirates Airline and Canada. Bilaterals are negotiated between sovereign states. The UAE currently has the right to operates a six flights a week to Toronto. At the moment Emirates lies three times and Etihad flies three times. Emirates had originally been offered all six but said no because they were not offered a daily flight. So Etihad took three leaving only three of Emirates.

Emirates documents fail to even mention the three flights a week operated by Eitihad.

2 Flights from the UAE to Canada are full, not of UAE nationals, but of passengers connecting from mainly South Asia. The UAE airports are hubs. Passengers fly thourgh Dubai, they do not fly to Dubai. Your typical passenger from say Bangalore can fly with Emirates via Dubai, or with Star Alliance partners via Frankfurt with One World alliance via London or with Air India through their Delhi hub.

Emirates simply wants a bigger slice of that pie.

3. Emirates is state owned. Air Canada is a public company with responsibilities to its shareholders; and, lets be honest here, with a responsibility to repay taxpayer loans.

4. Emirates has invoked government support to "bully" Canada into extending landing rights.

The following actions have been taken.

The Canadian base at Camp Mirage has been closed. This was leased to the Canadians rent free; that said the Canadians will contributed to the UAE economy through money spent and supplies acquired here. The base was used to support the Canadian peace keeping activities in Afghanistan. Canada is rightly proud of the fact that for decades it has been in the front line of every NATO supported peace keeping initiative. The UAE was more than happy to see Canadian forces seeking to help maintain stability in this volatile region. In closing the base the UAE put it's airline's commercial profit before humanitarian and diplomatic interests.

Canadians will require a visa to enter the UAE from 2 January 2011. They will be only "western nation" that is not part of the UAE's visa waiver programme.

The UAE denied landing rights to an airplane of the Canadian Foreign Minister and the Minister for Veteran Affairs. Sorry to0 say but this looks like petty retribution. Of course every nation has a right to say who can pass through its airspace. But the UAE could have set a precedent. It is a very long way from the UAE to the USA if you cannot pass through Canadian airspace.

The UAE admitted that it lobbied hard to deny Canada a seat on the UN security council.

How is any of the above a a reasonable and predictable response to limiting Emirates Airlines access to Canada. If Emirates wants its PR bluster to be credible it should be distancing itself from the actions taken in its supposed support by the UAE government.

4. The UAE is hardly a bastion of free trade and open competition. Protectionism works very well for the UAE when it is seen as being in the UAE government's interests. Just search on Skype, DEWA, Etisalat in the UAE for background. So do not act surprised or offended when other government's seek to protect their own business interests.

5. Canada has no company with an order book the size of EK. There is no company in Canada that is recruiting pilots in numbers (700) like EK. Canada has a large country with a tiny population. Many of these small communities require domestic air service. Air Canada has to support a significant domestic network. Not a cost that Emirates or Etihad has to bear.

6. No one will argue that Air Canada is a fantastically run business. It is not. But then there are limits to what it can do in comparison to EK/EY. It cannot be competitive to EK/EY so it needs some degree of protection. These are no more than protections that any country sets out when trade imbalances exist. What is best for Air Canada and Canada is to allow competition into the market, from several sources... but to be managed, or as is now protected.

Twitterers beware

12 November 2010

Twitterers beware. Judges have no sense of humor. And even endless exclamation marks will not save you.

The Twitter joke trial is a classic collision between new technology, post 9/11 paranoia, witless judges, and a hapless victim.

So what happened?

Paul Chambers, a 27-year-old accountant, yesterday lost his appeal against his conviction and £1,000 fine for a comment he made in jest when he was concerned he might miss a flight to Belfast.

This was his public tweet.

"Crap! Robin Hood airport is closed. You've got a week and a bit to get your shit together otherwise I'm blowing the airport sky high!!" he wrote in January.

Chambers was controversially prosecuted under a law aimed at nuisance calls – originally to protect "female telephonists at the Post Office" in the 1930s – rather than specific bomb hoax legislation, which requires stronger evidence of intent.

But this is an accountant and a disappointed customer - not a suicidal jihadist.

His appeal was yesterday and after it failed. Mr Chambers has already lost his job because of the prosecution. Some 24 hours after his appeal failed, the "hashtag" #twitterjoketrial remains one of the top trending topics on twitter.

A so-called "I'm Spartacus" campaign encouraging users to "re-tweet" his words has also become a huge hit.

The I'm Spartacus campaign is inspired by the famous scene in the 1960s movie blockbuster, when slaves stood up one by one to claim "I'm Spartacus" in order to save their fellow gladiator (Kirk Douglas as Spartacus) from detection.

Chambers is believed to be the first person convicted in the UK for posting an offensive tweet.

After the hearing, actor and Twitter fan Stephen Fry tweeted that he would pay Chambers' fine. Question for you dear reader - if Mr. Fry, with his hundreds of thousands of followers had sent the same tweet would he have been prosecuted with the same dedication ?

Comedian Dara O'Briain tweeted that the verdict was "ludicrous" while Peep Show actor David Mitchell said it was "punishment for flippancy".

In the meantime, globally, his text (with hashtag #iamspartacus) is being re-tweeted.

Judge Jacqueline Davies yesterday called the tweet "menacing in its content and obviously so. It could not be more clear. Any ordinary person reading this would see it in that way and be alarmed".

She also ordered him to pay a further £2,000 legal bill for the latest proceedings. She dismissed his lawyers' arguments that he should not be punished for a "foolish prank".

Now will everyone who has re-tweeted the message be prosecuted and fined a further gbp1,000. That will quickly add up to millions.

Here is the rebuttal - a well argued and rational response in an Open Letter to Judge Jacqueline Davies.

Judges in the dock

12 November 2010 - The Economist

Economist seeking another ban in Thailand!

"Since 2006, when the armed forces ousted the then prime minister, Thaksin Shinawatra, Thailand’s constitutional court has dissolved two popular pro-Thaksin parties and disqualified hundreds of his allies. Now it may be the turn of the ruling Democrat Party, which is accused of campaign-finance fraud. A final hearing in the first of two cases is scheduled for November 29th.

The party denies wrongdoing. Yet in the court of public opinion, it is the judges themselves who are in the dock. A series of leaked videos posted on YouTube by “ohmygod3009” has dealt a blow to the court’s standing. In one, a member of parliament for the Democrat Party appears to be lobbying the secretary to the court president, Chat Cholaworn, to go easy on the party. In other videos, senior judges appear to discuss how to cover up the leaking of exam papers to relatives applying for jobs at the court. A new batch of YouTube videos released on November 8th, and swiftly blocked in Thailand by court order, also relate to alleged nepotism in hiring. More videos are promised. “Hold on tight,” exhorts a mysterious poster.

The court’s haughty response has been to claim a conspiracy by “ill-intentioned people” out to discredit it. The Democrats accuse their opponents of leaking the videos in the hope of forcing the court to dissolve the party, since to do otherwise would be to imply that it had bowed to political pressure. The MP caught on tape discussing the party’s case said that it was a set-up by Mr Chat’s secretary, who has since fled overseas and may be the source of the videos. Government critics say the court has shown its true, biddable colours.

A guilty verdict in the case and a break-up of the pro-establishment Democrats would tip Thailand back into political chaos after months of relative calm. At the time of the alleged fraud, the current prime minister, Abhisit Vejjajiva, was a deputy leader of the party. Under the latest, military-imposed constitution, party executives share collective guilt for any wrongdoing. Should Mr Abhisit fall on his sword, other Democrats are waiting in the wings. A former deputy prime minister, Suthep Thepsuban, is one candidate. A more likely replacement may be Chuan Leekpai, a two-time prime minister and party elder. But any new leadership would be unstable, and early elections may beckon.

Manipulation of the courts would be nothing new. In 2008 Mr Thaksin’s lawyers were jailed for offering a cake box stuffed with cash to officials at the supreme court, which was trying his wife. The Democrat MP was not seen doing anything as gauche, though the affair has left a nasty whiff. Paradoxically, the scandal may yet help the Democrats if it delays a final verdict. Judges caught on tape may have to recuse themselves from the trial. With more embarrassing videos perhaps to follow, there may be less haste in deciding the fate of Mr Abhisit’s party, determined to hang on to power until its term ends in a year. How very convenient."

The QF32 scarebus

12 November 2010

A full list of the damage to the Airbus A380 has been revealed after it was nursed back to Singapore on three engines.

When it touched down the fuel systems were failing, the forward spar supporting the left wing had been holed and one of the jet's two hydraulic systems was knocked out and totally drained of fluid.

Investigators found shrapnel damage to the flaps, a huge hole in the upper surface of the left wing and a generator that was not working.

The crew could not shutdown the No. 1 engine using the fire switch. As a result the engine's fire extinguishers could not be deployed.

Captain Richard de Crespigny, first officer Matt Hicks and Mark Johnson, the second officer, could not jettison the volume of fuel required for a safe emergency landing.

With more than 80 tonnes of highly volatile jet kerosene still in the 11 tanks -- two of which were leaking - they made an overweight and high speed approach to Changi Airport.

Without full hydraulics the spoilers - the hinged flaps on the front of the wings - could not be fully deployed to slow the jet.

The crew also had to rely on gravity for the undercarriage to drop and lock into place.

On landing they had no anti-skid brakes and could rely on only one engine for reverse thrust - needing all of the 4km runway at Changi to bring the jet to a stop.

The three crew have been interviewed by Australian investigators and cleared to return to duties.

Industry sources said the damage will almost certainly put the airline's flagship jet - the Nancy-Bird Walton - out of service for months.

Investigators found that an oil fire may have caused the engine to explode.

Details of the stricken jet's problems were revealed yesterday in an emergency directive by the European Aviation Safety Authority.

The authority made it mandatory for airlines with the now suspect Rolls-Royce Trent 900 engines to make checks for excess oil.

If not detected, excess oil can cause a fire and ultimately result in "uncontained" engine failure, with potential damage to the aeroplane and to people or property on the ground.

Qantas made it clear it will keep its six superjumbos grounded indefinitely and has rearranged flight schedules using substitute aircraft.

WHAT WENT WRONG ON QF32

1 Massive fuel leak in the left mid fuel tank (there are 11 tanks, including in the horizontal stabiliser on the tail)

2 Massive fuel leak in the left inner fuel tank

3 A hole on the flap fairing big enough to climb through

4 The aft gallery in the fuel system failed, preventing many fuel transfer functions

5 Problem jettisoning fuel

6 Massive hole in the upper wing surface

7 Partial failure of leading edge slats

8 Partial failure of speed brakes/ground spoilers

9 Shrapnel damage to the flaps

10 Total loss of all hydraulic fluid in one of the jet's two systems

11 Manual extension of landing gear

12 Loss of one generator and associated systems

13 Loss of brake anti-skid system

14 No.1 engine could not be shut down in the usual way after landing because of major damage to systems

15 No.1 engine could not be shut down using the fire switch, which meant fire extinguishers would not work on that engine

16 ECAM (electronic centralised aircraft monitor) warnings about the major fuel imbalance (because of fuel leaks on left side) could not be fixed with cross-feeding

17 Fuel was trapped in the trim tank (in the tail)creating a balance problem for landing

18 Left wing forward spar penetrated by debris