World important news by Hailey

October 26, 2011 at 8:39am

She came, she saw, she confounded: Clinton in Pakistan


Secretary of State Hillary Clinton’s recently concluded visit to Pakistan has left us none the wiser about how the United States and its allies will end the  Afghan war. In her public comments, she spoke of action ”over the next days and weeks – not months and years, but days and weeks”.  She promised the United States would tackle Taliban militants in eastern Afghanistan in response to a long-standing Pakistani complaint that Washington had neglected the region when  it decided to concentrate its forces in population centres in southern Afghanistan in 2010 (remember “government in a box”?). She called, in return, for cooperation on the Pakistani side of the border to ”squeeze these terrorists so that they cannot attack and kill any Pakistani, any Afghan, any American, or anyone.”  Between the two countries, they would tackle the Afghan Taliban, the Haqqani network and the Tehrik-e-Taliban Pakistan (TTP), or Pakistani Taliban. But squeeze them to what end?  To weaken all but the hard-core leadership of the Afghan Taliban and the Haqqani network so that they agree to lay down arms and rejoin the political process in Afghanistan? Or to entice them into serious negotiations through which they might be offered a share of power in Kabul, or accommodated in a “soft partition” of Afghanistan (an idea deeply unpopular among Afghans) which leaves them in control of the south and the east? As Pakistani columnist Ejaz Haider wrote in Pakistan Today just before Clinton arrived, the current U.S. policy looks a bit like the dialogue between Alice and the Cheshire Cat. “‘Would you tell me, please, which way I ought to go from here?’ asked Alice. ‘That depends a good deal on where you want to get to,’ said the Cat. ‘I don’t much care where—’ said Alice. ‘Then it doesn’t matter which way you go,’ said the Cat.” True, Clinton stressed the need for a peace process to reach a political settlement in Afghanistan.  But that idea has been on the diplomatic agenda  for nearly two years. By the second half of last year, we were hearing that the United States had endorsed talkswith all of Afghanistan’s main insurgent groups, including the Haqqani network. By January this year, western countries said there would be no preconditions set for insurgents entering peace talks – only end-conditions that they sever ties with al Qaeda, renounce violence and agree to respect the Afghan constitution. In February, Clinton stressed the need for negotiations in a landmark speech to the Asia Society which coincided with reports the United States had begun direct talks with the Taliban. In other words, we have heard a lot about talk about talks without any explanation as to why these have achieved so little so far (some blame U.S. military strategy, others Pakistani interference, others Taliban intransigence, others poor Afghan governance).   And the danger is that as long as these talks about talks continue without  yielding results, all parties to the Afghan conflict arm themselves up in readiness for an escalating civil war. True,  Clinton admitted in public during her visit to Islamabad that the United States had held a preliminary meeting with representatives of the Haqqani network. But we already knew that.    According to The Washington Post, U.S. officials met Ibrahim Haqqani, the brother of the group’s patriarch, Jalaluddin Haqqani, in a Gulf kingdom in August. The meeting was arranged by the head of Pakistan’s Inter-Services Intelligence (ISI) agency, Lieutenant General Ahmed Shuja Pasha, who also attended, it reported. But that meeting does not seem to have gone well. It was followed by an attack on the U.S. embassy in Kabul which the United States blamed on the Haqqani network and which prompted outgoing chairman of the U.S. Joint Chiefs of Staff Admiral Mike Mullen to describe the group as a “veritable arm” of the ISI. Clinton has made clear the U.S. strategy will continue. ” We’re going to be fighting, we’re going to be talking and we’re going to be building,” she told reporters in Afghanistan.  And even if that carries a ring of ”if at first you don’t succeed, try, try and try again”, that is no reason to dismiss it out of hand. However much the United States and its allies are looking for a way out of the Afghan war, pressure is also mounting on Pakistan. Washington is stepping up efforts to bring supplies to Afghanistan through Central Asia – Clinton flew from Pakistan to Uzbekistan and Tajikistan – thereby reducing U.S. dependence on Islamabad/Rawalpindi even as Pakistan’s own deteriorating economic health is making it harder for it to risk losing international and U.S. financial support. And more importantly India this month signed a strategic partnership agreement with Afghanistan – one unlikely to have been reached without U.S. approval — which gives India the capability, if not the intention, to put Pakistan under pressure on both its western and eastern borders. Yet even as the United States doubles down, do also consider two quite different approaches, both of which have the merit of greater clarity but which are also  diametrically opposed. One of them I heard presented this month by Amrullah Saleh, the Tajik former head of the Afghan National Directorate of Security (NDS) and a fierce critic of talks with the Taliban. At a conference organised by the Asia-Pacific Foundation in London,  he argued there was no reason to believe Pakistan would be any more inclined to cooperate with the United States now than it was when Washington sent in more troops to Afghanistan. “With that escalation, Pakistan did not cooperate. Why would Pakistan cooperate with de-escalation?” he said. Rather than rely on Pakistan, he argued that the Afghan government must implement reforms to restore the trust of the Afghan people so they would at least have a state by 2014, when U.S.-led troops are meant to hand over responsibility for security to Afghan forces. And Kabul should change its policy of talks with the Taliban which had “blurred the narrative” for Afghans about who they were fighting, looking instead at reintegrating all but the 200 or so in the inner circle of the insurgency’s leadership.. But a scenario which led to a ceasefire and a political deal which left Pakistan and what he called its proxies with control over eastern and southern Afghanistan would offer only “a temporary, deceptive, stability”.  The Taliban would remain militant in order to put pressure on Kabul and extort further concessions from the west. Such a deal might provide cover for a withdrawal of western troops, but would also lead to ”massive civil strife”. The opposite approach is the one advocated by Pakistan, which  – in somewhat unfortunately chosen words - is to “give peace a chance”.  Articulated in detail in a report produced jointly by the Jinnah Institute and the United States Institute of Peace, it aims for a negotiated settlement giving Afghan Pashtun a bigger say in the political process and possibly including the Afghan Taliban and the Haqqani network. According to this version, the U.S. position of fight, talk and build cannot work because the insurgents will not trust the Americans to negotiate sincerely as long as they reserve the right to use their very considerable force.  Only a ceasefire on all sides would pave the way for meaningful talks on a political settlement. The report, criticised to some extent within Pakistan, also notes what is perhaps one of the trickiest issues in the whole approach to Taliban talks: this is not just about Afghanistan. Whatever Pakistan really wants to happen in Afghanistan, and whatever it support it does or does not give to the Afghan Taliban and the Haqqani network, it is also dependent on them to keep control of the Pakistani Taliban (TTP). According to this excerpt, those who contributed to the Jinnah Institute report questioned “the mis-perception that the Pakistani security establishment is unaware of the growing linkages between the Afghan Taliban and Pakistani militant groups.” “ However, they argue that while the current links remain limited, it is precisely the fear of these growing into full blown operational cooperation and coordination that prevents the Pakistani state from targeting Afghan insurgent groups on its soil. Moreover, the security establishment is able to take advantage of the present linkages between these groups from time to time by persuading the Afghan Taliban to pressure the TTP and other North Waziristan-based militants to curtail their activities.” Stretch that argument out further and you could make a case that Pakistan needs to get a reasonable deal for the Afghan Taliban and the Haqqanis in Afghanistan if it wants them, in return, to bring the Pakistani Taliban to heel. So to get back to Clinton and the Afghan settlement. We have three possible approaches, with various permutations.  The one currently favoured by the United States is to keep fighting, to keep the door open for talks, and to keep piling pressure on Pakistan in the hope that it yields results. The second – as expressed by Amrullah Saleh – is to take the idea of talks with insurgent leaders off the table altogether, end the confusion and build up governance within Afghanistan in the years that are left before 2014. The third is to seek a ceasefire, so that in the absence of violence, talks might take place in a more conducive atmosphere. Any one of those approaches has its merits.  But as long as all these conflicting ideas remain out there, we will see a lot of different groups lining up to argue with the Cheshire Cat.

October 18, 2011 at 9:35am

UPDATE 1-Olympus scandal highlights board inadequacies in Japan


* Olympus case takes shine off recent steps to improve governanceBy Nathan LayneTOKYO, Oct 18 (Reuters) - The scandal at Olympus Corp triggered by accusations of improper payments has put a spotlight on what critics say is a key weakness of Japanese-style management: the lack of strong independent oversight on most boards.Japanese boards are typically stacked with insiders, and Olympus, a camera and medical equipment maker whose chief executive was abruptly dismissed last week, is no exception.Twelve of Olympus’ 15 board members are company executives, and one of its three outside directors failed to pass a test of independence set by top proxy voting firms.This structure, while common among Japanese companies, appears to have left the Olympus board vulnerable to groupthink when dissension and rigorous debate were needed most.”You have so many insiders, very few independent members and none of them is really in a position to challenge the decision-making of long-standing members of the board,” said Robert McCormick, chief policy officer at proxy advisory firm Glass Lewis & Co. “I think the CEO kind of came into that.”A spokesman for Olympus said its board of directors was functioning well.Former Olympus CEO Michael Woodford has told media he believes he was sacked for questioning about $680 million in payments to financial advisers in the purchase of Britain’s medical equipment firm Gyrus in 2008, or one-third of the transaction price, and $600 million in goodwill impairment after other small acquisitions in Japan.Olympus says that Woodford was dismissed because of a clash of management styles and that it has carried out proper accounting and disclosure for the acquisitions.SHARES PLUNGEBut the relentless slide in the share price — it has lost 43 percent in the past three sessions — suggests investors are not satisfied with the company’s explanation and generally lack confidence in management.Chairman Tsuyoshi Kikukawa, who replaced Woodford as CEO, told the Nikkei newspaper on Tuesday that the Gyrus-related payment was closer to 30 billion yen ($391 million) and said losses at the domestic companies it acquired represented lapses in judgment on his part.But to some critics Kikukawa’s comments may only reinforce the notion that there have been few checks on his authority and may not silence criticism of the payments, which at 30 billion yen were still unusually high for an acquisition of that size.The lack of independent directors supervising management is one of the key factors behind Japan’s No. 36 ranking out of 39 countries on corporate governance in the latest survey by research firm GMI .Other propagators of poor governance include cross-shareholdings with business partners and a tendency for executives to hang on wielding influence in advisory posts even after they’ve retired from the board.The Olympus case may give the impression that governance is moving backwards, despite a series of steps aimed at improving the situation in recent years, including the Tokyo Stock Exchange’s requirement from this year that all companies have at least one independent director or auditor.”This is a negative step for corporate governance in Japan,” said Jamie Allen, secretary general of the Asian Corporate Governance Association based in Hong Kong.”There had been some hope that Japanese companies would take on not just outside directors but outside managers and that corporate cultures in Japan would be more open and international.”

October 14, 2011 at 3:31am

UPDATE 1-Sony Ericsson to shift fully to smartphones in 2012


* No comment on reports of Sony taking 100 pct controlSTOCKHOLM, Oct 14 (Reuters) - Mobile handset maker Sony Ericsson said on Friday it would in future focus entirely on the fast-growing smartphone market as it posted in-line quarterly profits, making no reference to a report electronics giant Sony would take full ownership.Pretax profit at the company, currently owned jointly by Sony and mobile network gear maker Ericsson, was 31 million euros ($42 million), just higher than the mean forecast of 27 million euros in a Reuters poll and a swing back from a loss of 42 million in the previous quarter.Last week, a source with direct knowledge of the matter told Reuters that Sony is in talks to buy Ericsson’s 50 percent stake in the joint venture.Sony Ericsson, facing strong competition from Apple’s iPhone as well as the likes of Samsung and HTC, has been losing market share — and money — for a while. A recent focus on smartphones based on Google’s Android platform has been gaining traction, pulling the company back into the black.The company, which stuck to its outlook for modest growth in the handset market this year, said that it would shift all its production to smartphones during 2012.”Android-based Xperia(TM) smartphone sales now account for more than 80 percent of sales and we have shipped 22 million Xperia smartphones to date,” the company said in a statement.”We will continue to invest in the smartphone market, shifting the entire portfolio to smartphones during 2012.”