Australia to levy $1.8b flood tax

Australian Prime Minister Julia Gillard announced a new 1.8 billion Australian dollar (US$1.79 billion) income tax to help fund reconstruction in flood-devastated Queensland state without tipping the government budget further into deficit. With a slender grip on power after last year’s election left neither of Australia’s two major political forces with enough seats to govern alone, Ms. Gillard’s handling of the flood recovery will be pivotal for the Labor government.

It comes as Canberra begins counting the clean-up cost of its worst natural disaster in decades, estimated by officials Thursday to trim about A$5.6 billion from the government budget and cut economic growth by half a percentage point in the fiscal year ending June 30.

The proposed year-long temporary tax hit the Australian dollar Thursday, sending it down to US$0.9964 from US$0.9997 during the Asian trading day, on the belief that it could have a dampening effect on consumer spending and take pressure off Australia’s central bank to raise rates. Australian stocks ended flat.The temporary tax, to apply to the fiscal year beginning July 1 to Australians earning over A$50,000 a year, will cost around A$1 a week for someone on an annual income of A$60,000, rising to A$5 a week for someone earning A$100,000 a year. In announcing the tax, Ms. Gillard is judging that the political cost of not delivering on a promise to restore the budget to surplus by the year ending June 30, 2013, would be greater than any voter backlash against higher taxes. The great majority of Australians are ready to contribute, I have no doubt about that, Ms. Gillard said. But Tony Windsor, one of a handful of independent lawmakers keeping the Labor government in power, warned: Don’t count on my vote for the new tax. Mr. Windsor is calling for a permanent National Natural Disaster Levy to fund future crises including floods, wild fires, hail storms or cyclones. Another key independent, Robert Oakeshott, is undecided. Meanwhile, the increasingly influential Greens Party said it supports the idea of a flood tax. But it added it opposes Ms. Gillard’s proposed spending cuts to other government programsincluding solar hot water rebates and energy efficiency measuresto help fund the recovery costs. That raises the prospect the tax legislation could be voted down when introduced into Parliament next month. It beggars belief that the government would choose to cut climate change programs…to fund disaster relief when such disasters will be made worse by climate change, acting Greens leader Christine Milne said. Joe Hockey, shadow Treasurer for the main conservative Liberal-National opposition coalition, said a tax to fund the flood recovery effort is too much on top of an anticipated rise in food prices as a result of the damage to agricultural land. On top of the recent Labor party increases in the cigarette tax and also alcohol taxes and car taxes and given that electricity prices are rising, it is too much at this point in the economic cycle, Mr. Hockey said. Rick Kuhn, a political expert at Australian National University, described the tax as an incredible act of hypocrisy on the part of the government. It is placing the burden for the flood relief onto ordinary working class taxpayers at a time when the government is going to be cutting the corporate tax rate, he said, referring to plans to cut the company tax rate to 29% from 30% from July 1, 2013. Devastating floods have washed out thousands of homes, roads and rail lines and killed more than 30 people across resource-rich Queensland state since December, disrupting exports and destroying agricultural crops. Australia is the world’s largest exporter of coal used for steelmaking and the second largest supplier of coal for power plants. Separate floods spreading across Victoria state over the past two weeks have affected 60 towns in an area larger than Denmark. Ms. Gillard pledged Thursday an immediate government payment of A$2 billion toward the Queensland reconstruction effort, to be funded by cutting spending in other areas and delaying non-urgent infrastructure projects in other states. Australia & New Zealand Banking Group Ltd. economists warned the flood tax will act as another constraint on household spending, reinforcing market expectations that the country’s central bank will hold interest rates steady for some time. This federal government flood tax will cost jobs, slow the economy and destroy households that are just hanging on, said Scott O’Driscoll, National President of the United Retail Federation. Woolworths Ltd., one of the country’s largest grocery and general-merchandise retailers, this week downgraded guidance for earnings growth this year, partly citing disruptions from the floods. Given the economy already is taking a big hit from higher food prices, rents and insurance premiums, it seems strange that the government wants to take the chance of damaging it further, Macquarie Research Economics director Brian Redican said. These policies increase the risks to the economy recovering in a quick and timely fashion from the flood impact. Economist and Reserve Bank of Australia board member Warwick McKibbin panned the tax proposal as politically motivated, saying that relaxing the government’s goal of restoring the budget to surplus in fiscal 2013 is a better option. (WSJ)

Mexico: Activists protest against world environmental policies

Activist from environmental group Greenpeace on Wednesday submerged models of iconic buildings and structures from around the world into the Caribbean Sea in a bid to draw attention to the threats posed by rising sea levels.

The sinking of these structures comes as leaders and ministers meet for UN climate talks at the Mexican beach resort of Cancun. Ministers in Cancun are seeking a package deal to set up a fund to oversee climate aid, ways to slow deforestation, steps to help poor countries adapt to climate change and a mechanism to share clean technologies such as wind and solar power. Many rich countries want emerging economies, led by fast-growing China and India, to do far more, including greater oversight of their programs to rein in greenhouse gas emissions.

Dengue claims two lives in Pakistan

Staff Report

KARACHI: Two people died of dengue fever in Lahore and Hyderabad and another 152 patients tested positive for the deadly mosquito-borne disease in different hospitals of Karachi over the past 24 hours.

Failing to take timely preventive measures against the outbreak, the Punjab government on Saturday replaced EDO Health Dr. Fayyaz Ranjha with Dr. Umar Farooq.

With no known treatment, dengue fever is spreading fast in Asia, according to the World Health Organization (WHO).

The WHO has warned that 2.5 billion people are at risk from one of the world’s fastest-emerging infections, which has “grown dramatically in recent decades.”

Officials at the WHO say Asia, home to 70% of the at-risk population, has seen a rise in dengue mainly because of higher temperatures due to climate change, rising populations and greater international

Australian farmers to lose water to restore rivers

CANBERRA: Farmers would lose more than a third of irrigation water in Australia’s major food bowl, the Murray-Darling, under a plan released on Friday to restore ailing rivers, posing a new headache for the Labor minority government.

The move could see the value of cotton production cut by 25 percent, and farmers and irrigators have warned of farm closures, massive job losses and higher food prices if the plan by the Murray-Darling Basin Authority is adopted by the government.

Environmentalists welcome the cuts, saying they will help Australia’s major river system survive future droughts brought on by climate change in the world’s driest inhabited continent.

Prime Minister Julia Gillard’s fragile one-seat majority government is dependent on support from both rural independents and the Green party and will have to balance both interests in deciding whether to

Australian activists close down largest coal port

SYDNEY: Australian environment activists closed down operations at the world’s largest coal port on Sunday, after entering three terminals and attaching themselves to loaders, the terminal operator and the protesters said.

The action by climate change group Rising Tide in Newcastle stopped operations at all three terminals operated by Port Waratah Coal Services, which normally run continuously, a company spokesman said.

Rising Tide said around 50 people were involved in the protest, some entering before dawn on Sunday, abseiling down machinery and attaching themselves to loaders. Others demonstrated with banners.

Annika Dean, a spokeswoman for the environment group, said the protest was an “emergency” action to highlight climate change, which she blamed for recent fires in Russia and floods in Pakistan.

“We have stopped all operations in the coal

Taiwan remembers 700 killed on typhoon anniversary

TAIPEI: Taiwan paid tribute on Sunday to more than 700 people killed or missing in Typhoon Morakot a year ago, one of the island”s worst natural disasters.

The typhoon slammed into Taiwan in August 2009, bringing powerful winds and torrential rain that left at least 614 people dead and 75 missing, including an estimated 400 buried in the village of Hsiaolin alone.

Typhoon Morakot dumped a record three metres (120 inches) of rain and some experts have since warned that global warming could trigger another similarly powerful storm in a year or two.

“Last year”s Morakot brought Taiwan the worst flooding in 100 years and caused havoc… the unusual torrential rains were a signal of climate change,” Vice President Vincent Siew said at a ceremony in Taipei.

President Ma Ying-jeou was to attend an evening memorial service in the southern city of Kaohsiung to commemorate the victims from Hsiaolin village.

While the opposition blamed the Ma administration for what they alleged was a slow response to the flooding, Ma has termed the typhoon a “painful lesson” and is now introducing a tough new planning law.

Over the past year, the authorities have built 1,480 new houses accommodating nearly 6,000 people, according to a cabinet statement.

But the homeless — most of them aboriginals — remain unhappy at the government moves. About 500 indigenous villagers staged a rally outside the presidential office Saturday in protest at the resettlement plans.

The government faced a wave of public anger over its handling of the disaster, plunging Ma into his worst political crisis since taking office in 2008.

His approval rating fell plummeted to 16 percent in the aftermath of the typhoon, compared with to an all-time high of 79 percent in the days after his election victory in March 2008.

Clinton to Seek Signs of Progress in Afghanistan

By Andrew QuinnSecretary of State Hillary Clinton heads to Afghanistan next week for a crucial conference that U.

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Clinton to Seek Signs of Progress in Afghanistan

IMF sees European banks safe in stress tests

PARIS: Stress tests being conducted in the European Union will show that all the major European banks have sufficient capital, International Monetary Fund chief Dominique Strauss-Kahn said on Friday.

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IMF sees European banks safe in stress tests

Britons to count trees to fight climate change

LONDON: A British museum is urging the public to record trees in parks, streets and gardens as part of a three-year survey to uncover how climate change is affecting the environment.

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Britons to count trees to fight climate change

UN urges more investment in developing world

UNITED NATIONS: As major economies cope with the global financial crisis, Secretary-General Ban Ki-moon has urged businesses to think differently about how and where they devote resources, stressing the importance of investing in developing nations to promote global growth.

“We can’t afford not to invest in the developing world. We all know that’s where the greatest need is. But that is also where some of the greatest dynamism is,” the UN chief told more than 1,200 corporate chief executives, government ministers, heads of civil society and other participants at the Global Compact Leaders Summit in New York City.

“Global economic growth requires investment in the developing world,” he stated, adding that with official development assistance (ODA) under pressure, foreign direct investment is that much more important.

Since its launch in July 2000, the Global Compact a UN initiative that seeks to foster socially responsible business practices has become the world’s largest and most ambitious project of its kind with at least 8,000 participants.

“The business community is coming to understand that principles and profits are two sides of the same coin,” noted Ban, who called on businesses to strengthen their commitment to corporate social responsibility.

He also urged business to do more to uphold human rights and labour rights, protect the environment and fight corruption, noting that business can and should be part of the solution. In addition, he appealed to business leaders to strengthen efforts to help the world achieve the global anti-poverty targets known as the Millennium Development Goals (MDGs) by their 2015 deadline.

“In our efforts to eradicate poverty, create jobs and control disease, 10 years of experience has shown us what works and what doesn’t work,” he said. “Our challenge now is to again scale up our commitment.”

Ban encouraged leaders to take advantage of the 15 partnership opportunities identified for the summit to advance the Goals, covering areas such as hunger, green energy, protecting girls from violence and improving maternal and child health.

“As the world continues to reel from the financial crisis, and as climate change, poverty, resource constraints and other threats test our capabilities, we need business as our partner more than ever before,” he later told reporters at a news conference with some of the leaders attending the summit.

The Secretary-General also announced that the goal for the Global Compact is to have 20,000 participants by 2020. “And our commitment is to do all this while maintaining the integrity of the initiative.”

In the past two years, more than 1,300 companies have been de-listed for failing to communicate progress in implementing the Compact principles.

“The Compact may be a voluntary initiative, but that doesn’t mean it lacks teeth,” he said. Ban said that as a boy growing up in a war-torn country, the Republic of Korea, he saw what business can do to help rebuild a country and transform an entire region.

“Now as Secretary-General of the United Nations, I am delighted to have this opportunity to push the Global Compact forward to the next higher stage and equip it for its second decade,” he said.

Meanwhile, the UN Children’s Fund (UNICEF) has teamed up with the Global Compact and Save the Children in calling on the business community to work with them to develop principles to be known as the Children’s Principles for Business that will help business avoid the negative impacts that their activities may have on children.

“Protecting children’s rights is a global responsibility that requires global commitment from us all, in every sector,” said UNICEF Executive Director Anthony Lake.

“This new partnership will help to establish clear principles for businesses to participate in the global effort to help all children, and especially those most in need.”

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