Blow for Cameron as China welcomes Hollande

Beijing punishes PM for his meeting with Dalai Lama while French president gets full state visit treatment

The Guardian, Nicholas Watt, chief political correspondent, Friday 26 April 2013

The French president, François Hollande, meets his Chinese counterpart,
 Xi Jinping, in the Great Hall of the People in Beijing, China. Photograph:
Pool/Getty Images

David Cameron's mission to change the focus of British foreign policy by boosting trade links suffered a setback after Downing Street was forced to abandon a trip to China as Beijing punished the prime minister for meeting the Dalai Lama.

In a blow to Cameron, who had hoped to hold an annual summit with the Chinese leadership, the French president François Hollande was on Friday feted in Shanghai on a full state visit a few weeks after the prime minister was due to visit China.

Cameron is understood to have abandoned the planned trip after Beijing indicated that he was unlikely to be granted meetings with senior figures. He is now expected to visit in the autumn, two years after his first and only visit as prime minister.

Britain accepts that Beijing is exacting punishment after Cameron met the Dalai Lama, the spiritual leader of Tibet, at St Paul's Cathedral last May. The meeting, which was similar to Gordon Brown's discussions with the Dalai Lama at Lambeth Palace in 2008, was designed to minimise offence in China by showing that Britain regards him as a spiritual leader. Downing Street has made clear to Beijing that it accepts Tibet is part of the People's Republic of China.

Government sources said that tentative plans for the prime minister to visit China this month were put on hold before his visit to India in February for the simple reason that the new Chinese leadership only took over in March. Cameron spoke to Li Keqiang, his new Chinese counterpart, after his appointment.

But the Guardian understands from diplomatic sources that a visit was firmly placed in the prime minister's diary for earlier this month. This was abandoned when it became clear that the prime minister would be denied the access usually granted to a G8 leader.

Douglas Alexander, the shadow foreign secretary who has just returned from China, told the Guardian: "David Cameron came to office claiming he would prioritise the UK's diplomatic and trade relationship with China, and yet the real difficulties in relations have now been laid bare. I was in China this week and it is clear that the new Chinese leadership are focused on the French president's visit, along with a large number of French companies looking for business.

"In the past, UK prime ministers have met with the Dalai Lama without the deterioration in relations with China that we are now seeing. For all of their initial boasts and bluster, the UK government has lacked a strategic or a joined-up approach to China since it came to office, and that's now showing."

A No 10 source said: "Of course, as any good diary planner would, we pencil in early on dates when the prime minister could potentially travel overseas without going firm on destinations. We decided several weeks ago that we wanted to visit some European capitals in the time we had earlier this month. When the prime minister and Premier Li Keqiang spoke in March they looked forward to meeting in due course."

Officials said trade with China is still rising and the two countries are on course to achieve £1bn in bilateral trade by 2015. Exports to China grew 13.4% last year.

But the decision to abandon the visit is a personal setback for Cameron, who said after coming to office that he would place trade at the heart of foreign policy, with a particular emphasis on the so-called Bric countries of Brazil, Russia, India and China. A visit to India in February fell flat after private complaints that the prime minister appeared to regard the country as a trading opportunity rather than an emerging world power.

Hollande was greeted by Xi Jinping, the new Chinese president, when he arrived in Beijing with his partner Valerie Trierweiler on Thursday. They agreed to hold an annual summit – Cameron's original aspiration when he first visited China in November 2010 – after Hollande said he hoped to build a "multipolar" world. This is the classic French ambition to ensure the US cannot dominate the world in a "unipolar" world.

Cui Hongjian, director of European Studies at the China Institute of International Studies, a foreign ministry thinktank, told the South China Morning Post that this message was well received in Beijing. "France sometimes has different ideas from the US. China may co-operate with France."

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Ex-US govt employee indicted on Cuba spy charge

Google – AFP, 25 April 2013

The US State Department is seen on November 29, 2010 in Washington, DC

(AFP/File, Nicholas Kamm)

WASHINGTON — The United States has indicted a former State Department employee now living in Sweden with conspiracy to commit espionage for Cuba, the Justice Department announced Thursday.

Justice officials said that Marta Rita Velazquez, 55, allegedly helped to "spot, assess and recruit US citizens" in sensitive national security positions to serve as Cuban intelligence agents.

One of those citizens was Ana Belen Montes, 55, currently serving a 25-year prison sentence after pleading guilty in March 2002 of conspiracy to spy on behalf of Cuba's communist regime.

If convicted, Velazquez faces a sentence of up to life in prison, the Justice Department said in a statement.

A Puerto Rico native educated at prestigious American schools, Velazquez worked for the State Department's international development arm USAID from 1989 until 2002, when she left the country and never returned.

A grand jury returned an indictment against her in February 2004, but it remained sealed until it was opened Thursday in US District Court in Washington.

The Justice Department said Velazquez, also known as "Marta Rita Kviele" and "Barbara," is currently living in Stockholm, but its statement made no mention of any request to Sweden for her extradition.

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Leiden shooting threat suspect spent time in Costa Rica

DutchNews.nl, Thursday 25 April 2013

The new suspect in a threat to shoot a teacher and pupils at an unnamed school in Leiden is an 18-year-old youth travelling around Latin and South America, the public prosecution department says.

The youth went to school in Leiden and 'had an interest in weapons'. He also gave a school presentation about school shootings in the US, the department said. According to his family, he plans to spend some time in Costa Rica.

Officials are now trying to locate where the boy is staying in the hope of bringing him back to the Netherlands to face charges. The public prosecutor does not rule out issuing an international arrest warrant for the youth.

The threat, made on internet site 4chan, led to all secondary schools in Leiden being shut on Monday and put under armed guard. Another boy was arrested in connection with the case but released on Tuesday without charge.

Dutch police free Leiden school gun threat suspect

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Dutch police free Leiden school gun threat suspect

US welcomes Venezuela's appointment of envoy

The Daily Star – AFP, April 24, 2013

(FILE) Picture taken on June 17, 2005 in Washington, DC of Calixto Ortega (L),
 then vice president of the Venezuelan National Assembly speaking beside
 Saul Ortega (R), president of Venezuelan Foreign Relations Committee, during
 a press conference at the Venezuelan Embassy regarding Venezuela's request
for extradition of Luis Posada Carriles. (AFP PHOTO/Andrew COUNCILL)

                              

WASHINGTON: The United States voiced hope Wednesday for a "productive" relationship with Venezuela as it welcomed the appointment of a new envoy to Washington by the successor of leftist leader Hugo Chavez.

President Nicolas Maduro on Tuesday named ruling lawmaker Calixto Ortega as the charge d'affaires at the embassy in Washington after the United States clarified that it was not seeking sanctions over Venezuela's disputed election.

State Department spokesman Patrick Ventrell said Ortega was "known and respected" for work in a group seeking to improve relations between the United States and Venezuela, which have not exchanged full ambassadors since 2010.

"With all bilateral diplomatic relationships, it's important to establish effective channels of communication between governments so we can discuss matters of mutual concern," Ventrell told reporters.

The appointment of Ortega "could be a step in that direction," he said.

"We believe it is important and timely to establish a productive relationship based on mutual interests such as counternarcotics, counterterrorism, the energy relationship," he said.

However, Ventrell repeated US support for a recount of votes in the bitterly fought April 14 election "to ensure that the Venezuelan people feel that their democratic aspirations are being met."

Chavez, who died last month after a long fight with cancer, was a strident critic of the United States and accused Washington of supporting a 2002 coup in which he was briefly overthrown.

But Venezuela, which relies on oil sales for 90 percent of its revenue, nonetheless exports 900,000 barrels a day to the United States.

Maduro briefly threatened to cut off such commerce after a US official was quoted as saying that Washington was open to economic sanctions against Venezuela over its election.

The State Department on Tuesday denied sanctions were under consideration, a statement welcomed by Maduro.

Former FIFA Kingpin Allegedly Stole Australia Cash

Jakarta Globe, Agence France-Presse, April 23, 2013

Former FIFA vice president Warner resigned as Trinidad and Tobago\'s
national security minister on Sunday, two days after an investigation
 accused him of \"fraudulent\" management of the Concacaf soccer
confederation. (Reuters Photo/Andrea De Silva)

               

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Sydney. Football Federation Australia demanded answers on Tuesday after a $462,000 donation it made to a Caribbean soccer organization was allegedly stolen by disgraced former FIFA kingpin Jack Warner.

The incident was detailed in a damning integrity report by the Caribbean, North and Central American international football body, Concacaf, that accuses Warner of enriching himself through fraud.

The report compiled by several former judges into the financial management of Concacaf relates to when Warner, a former vice-president of FIFA who quit in 2011 after being accused of paying bribes, headed the organization.

It said FFA paid a check into a Caribbean bank account maintained by Concacaf in 2010 to help the Trinidad and Tobago Football Federation improve a center of excellence.

The donation was part of Australia’s attempt to demonstrate its international football credentials during its failed bid to host the 2022 World Cup.

But the account was allegedly controlled by Warner who pocketed the money and never declared it to Concacaf, the report said.

“The committee concluded that Warner committed fraud and misappropriated funds that were sent by Football Federation Australia to Concacaf for development of the COE,” the integrity report said. “[He] breached his fiduciary duties to Concacaf through fraud and misappropriation of funds.”

Warner, who stepped down as Concacaf president in 2011, denies any wrongdoing but resigned as Trinidad and Tobago’s minister of security over the weekend.

Media in Australia said the donation raised questions about the FFA’s decision to give lucrative grants to football organizations headed by influential FIFA officials previously accused of corruption.

But an FFA spokesman told AFP the cash was donated with “complete transparency” and Australian football authorities only became aware it had allegedly been misused when the Concacaf report came out on Friday.

“FFA is currently considering the findings of the Concacaf Integrity Committee report,” said the FFA’s chief spokesman. “FFA has assisted Concacaf in this investigation and yesterday wrote to Concacaf regarding next steps.”

He said the funding “related to the mandatory FIFA World Cup bidding criteria.”

“FFA was required to demonstrate its credentials in the area of international development,” he said, adding that all funding was reported to the Australian government.

Despite a $45 million grant from the government and intense lobbying, Australia managed to secure just one vote when the FIFA executive committee decided the 2022 hosts.

Qatar was controversially awarded the hosting rights.

Agence France-Presse

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Horacio Cartes wins Paraguay election

Rightwinger from Colorado party tied to big agricultural interests sweeps to popular victory despite stain of corruption scandals

guardian.co.uk, Jonathan Gilbert in Asunción and Jonathan Watts, Latin America correspondent,  22 April 2013

Horacio Cartes celebrates his victory in the Paraguayan presidential election.
Photograph: Jorge Saenz/AP

Paraguayan voters have elected the rightwing tobacco tycoon Horacio Cartes as president after a campaign marked by allegations of vote-buying, crime and homophobia.

Despite having been investigated for fraud and drug smuggling, Cartes recorded a clear-cut victory that marks the resurgence of his Colorado party, which held a grip on power for six decades until 2008.

The main challenger, Efrain Alegre of the ruling centre-right Liberal party, conceded defeat on Sunday evening when a partial count showed him almost 10 points behind. With more than half of the polling stations reporting, Cartes was on course to win 46% of votes while Alegre lagged with 36.9%.

Thousands of red-clad Colorado supporters gathered outside Cartes's campaign headquarters on Sunday night, waving flags, blaring music from cars and letting off fireworks. Cartes made a brief victory speech in which he called for unity. "I won't work alone," he told the crowd. "We have to work together to move Paraguay forward."

"I'm so happy we're back in power," said Norma Silva, 48, a member of the party celebrating on the back of a pick-up truck with her family. She works in a government ministry. "Cartes will create work for young people. He's the future."

The return of the party – which represents landowners and agribusiness – looks likely to worsen Paraguay's troubled relationship with the leftwing governments that run most of its South American neighbours. Many withdrew their ambassadors in 2012 after the ousting of Fernando Lugo as president.

Cartes, who has shares in more than 20 companies, campaigned on the promise of creating jobs, and investing in health and education. This appealed to voters looking for more growth in the isolated and poor nation.

Many Paraguayans migrate to Argentina and Spain in search of employment. "Cartes will open the doors for young people to work," said María Fleitas, a 34-year-old lawyer voting at a downtown Asunción polling station.

But both candidates faced corruption allegations during the election campaign. Cartes, who will start his five-year term in August, spent nearly a year in jail in 1989 for illegal currency dealings, though he was later acquitted.

WikiLeaks cables reveal he was recently investigated by the US for trafficking drugs and contraband cigarettes from the tri-border with Argentina and Brazil. In 2000 a plane loaded with marijuana and cocaine was seized by police after it landed on one of Cartes's farms. Cartes has also been accused of laundering money for Brazilian drug traffickers.

Cartes dismissed such claims as mere "anecdotes" on Sunday morning.

Landlocked Paraguay is considered one of Latin America's most corrupt nations and few here expected clean elections before polling stations opened on Sunday.

A Colorado party senator was suspended on Saturday after he was filmed supposedly offering cash to provincial Liberal party officials in exchange for annulled ballot papers. Local press reported votes being bought for just a few pounds, a practice that has been commonplace in the past.

Many voters were unperturbed by Cartes's time in jail and the accusations against him. "All the candidates are stained," said María Cattebeke, 31, a teacher voting in the capital. "So the dirt on Cartes doesn't really matter."

She added: "He is an excellent businessman and that will reflect in his management of the government," echoing a view held by many. "He can take the country forward."

Cartes will inherit benign economic conditions. Thanks to a strong harvest, Paraguay, a major beef and soy exporter, is forecast to grow economically by around 10% this year.

In 2008 voters elected the leftwing Lugo as president but his reforms were blocked by opposition from landowning elites and multinational agrochemical companies.

His supporters were left disillusioned. "Lugo cheated me," said Verónica Gómez, a 53-year-old housewife who voted for him five years ago but cast her ballot for Cartes on Sunday. "I believe in Cartes."

The former president has warned that Cartes's government will do little to alleviate conditions for the third of the population who live in poverty. "The Colorado party represents the interests of a small privileged group," Lugo, who was impeached in a parliamentary coup last year, told the Guardian. "Its political model is a return to the past."

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Venezuela's Maduro retains key Chavez ministers

Google – AFP, Jim Mannion (AFP), 22 April 2013

President Nicolas Maduro salutes militay-style during a motorcade after

his installation in Caracas on April 19, 2013 (AFP/File, Luis Acosta)

CARACAS — Venezuelan President Nicolas Maduro launched a "government of the streets" Monday with new finance and interior ministers, even as his election to replace the late Hugo Chavez remained in dispute.

Other key ministers who had been appointed by Chavez were confirmed in their posts, including the foreign, defense and energy portfolios in a line-up that also ratified Chavez's son-in-law Jorge Arreaza as vice president.

The changes suggested that Maduro, who narrowly escaped defeat at the polls April 14, intends to tackle two major sources of public discontent -- an inflation-ravaged economy and soaring violent crime.

"We have to control inflation," Maduro said in announcing his so-called "government of the streets" late Sunday, saying more goods needed to be made in Venezuela to deal with "overheated" domestic consumer demand.

He split the ministry of planning and finance in two, naming central bank chief Nelson Merentes the new finance minister to replace Jorge Giordani, who was left in charge of the separate planning ministry.

Giordani was the architect of a system of strict foreign currency controls that critics say have contributed to shortages, a sharp decline in investment and Latin America's highest inflation rate, at more than 20 percent.

Maduro praised Giordani as "one of the most loyal men Chavez had," but said Merentes was "a brain on the economy" who would bring new ideas on how to control speculation and inflation.

The president said Merentes' goal was to reduce inflation to single digits in three years, and proposed the creation of special economic zones as a way of attracting foreign investment to boost domestic production.

He also named his intelligence chief, Miguel Rodriguez Torres, as minister of the interior and justice "to protect and build the foundations of peace" in a country with one of the world's highest murder rates.

The new government came after an estimated 700,000 voters swung to opposition candidate Henrique Capriles following his 11 point loss to Chavez in October presidential elections.

Maduro was proclaimed the winner with a 1.8 percentage point margin.

National Assembly speaker Diosdado Cabello, the second most powerful Chavista figure after Maduro, said Sunday he had ordered an internal review within the ruling party to try to understand what happened.

He said the spirit of self-criticism should also extend to the government.

Meanwhile, the opposition's fight for a recount of the April 14 election moves back to National Electoral Council, which has promised an audit of the vote while warning it will not overturn Maduro's win.

Pope Francis, who hails from Argentina and is the first pontiff from Latin America, said in a statement from the Vatican Sunday that he was following events in Venezuela "with great concern."

"I invite the dear Venezuelan people, and in particular its institutional and political leaders, to establish a dialogue based on the truth, mutual recognition in the search for the common good and out of love for the nation," he said.

Maduro responded: "I agree, Pope Francis. I'm concerned about the intolerance, the hate and the violence that generated deaths and injured."

Capriles tweeted: "A million thanks to Pope Francis for his mention of our Venezuela and the search for solutions founded on the truth."

In an interview with the Ultimas Noticias daily, Cardinal Jorge Urosa, the head of the Venezuelan church, offered to help arrange a dialogue.

The Catholic Church has often mediated in Latin American conflicts but was largely sidelined in Venezuela under Chavez, a leftwing populist who claimed to be a devout Catholic but often clashed with the bishops.

Urosa acknowledged the church's appeals have often gone unheeded.

Archangel Michael on Who Was Behind the Boston Bombings: It Was an Extreme Right-Wing Group of Disaffected Americans

goldenageofgaia.com, Steve Beckow,  April 17, 2013  

I’ve just had a personal reading with Archangel Michael through Linda Dillon (April 17, 2013). I asked him to tell us who caused the Boston Bombings and here is his response.

Steve Beckow: Who was behind the Boston Bombings?

Archangel Michael: What we would call disillusionaries.

SB: OK.

AAM: What you would think of as … no, it was not a planned government action, if that is what you are asking.

SB: How then could it be that pages appear on Facebook before the fact talking about the bombing?

AAM: Oh, there was a lot of planning implementation and the bombing was known about and not prevented. So we are not saying that there was not a form of collusion but the bombing itself was in fact perpetrated by two … well, originally two and then it grew … by a group of individuals that are very disenchanted, shall we say, by the existing regime of government.

SB: Now I would like to confirm that they were not Saudi nationals.

AAM: No.

SB: American citizens?

AAM: Yes.

SB: Alright. Will their identities become known? Will they be arrested or will this be covered up?

AAM: No, eventually it will come to the surface. And, as you well know, things are moving much more rapidly these days.  And so it will come to the surface. We are not talking about years. We are talking about a brief period of time.

SB: So the FBI will not cover this up?

AAM: The FBI will not be in a position to cover it up.

SB: Alright. Now, why did the galactics not intervene?

AAM: Because it is part of the bringing to the forefront [of] the violence. Now let us tell you something about the galactics. Just like us [the celestials] they do not intervene in acts of free will where there is a grander unfoldment – for example, the exposure of the violence in your society – that will make people denounce and change their behaviors.

So they do not intervene in that kind of a situation. Where they will intervene is more of a greater chance for, shall we say, global disaster.

SB: OK. Lots of people are saying that President Obama is complicit in this. Is he complicit.

AAM: No, he is not.

SB: Alright. So anything more you can tell us. Is it useful to know if this a right-wing group?

AAM: It is an extreme right-wing group that would like to see the elimination of what you think of as the federal government.

If you took the Tea Party and put them on the left and then put this group on the right, you would have the positioning.

SB: And you don’t want to say exactly who it is, I take it?

AAM: No, we do not. 

Tamerlan Tsarnaev travelled to Russia in 2012 for

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Venezuela President-elect Maduro bans opposition rally

BBC News, 16 April 2013

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Mr Maduro has blamed the opposition
for violent clashes

Venezuela's President-elect Nicolas Maduro says he will not allow the opposition to go ahead with a rally planned for Wednesday in Caracas.

Mr Maduro blamed the opposition for violent clashes after he was proclaimed winner of Sunday's disputed poll.

The attorney general said seven people had died in the violence.

But opposition leader Henrique Capriles said the government was responsible for the violence as it sought to avoid a vote recount.

In addition to the seven who died, Attorney General Luisa Ortega said more than 60 people were injured and 139 arrested during violent clashes at opposition protests.

She said some offices had been set on fire and public property destroyed.

Mr Maduro said the government would not be blackmailed, and he called on Venezuelans to remain peaceful.

For his part, Mr Capriles accused the government of orchestrating the violence to avoid a recount, something which he has been demanding.

Mr Capriles also earlier repeated his call for peaceful demonstrations.

He has said he will not accept the election results until all the votes are counted again, and he has called Mr Maduro "illegitimate."

The run on Latin America's resources

Deutsche Welle, 15 April 2013

Once neglected, now courted: Latin America is becoming increasingly important as a supplier of raw materials for German industry. China, Canada and the US are competitors in the race for natural resources.

Copper and lithium from Chile, iron ore from Brazil and gold from Peru: German industry is increasingly turning to South America when it comes to raw materials, seeking to join forces with the emerging region.

Germany launched a charm offensive in January when Chancellor Angela Merkel attended the EU-Latin America summit in Santiago de Chile to promote a new partnership among equals. Until then, the chancellor had shown but mild interest in the region, and since taking office in 2005 had visited the continent but once. Just three months after the summit in Chile, Ecuadorian President Rafael Correa opened German Industry's 13th Latin America Conference in Berlin on Monday (15.04.2013.)

Funds for friends

Chile and Brazil are among the world's most important mining nations, and along with Canada, the US, Australia, South Africa, China and Russia, they produce 50 percent of the global raw materials.

"Apart from Chile and Brazil, Peru is certainly attractive at the moment, too - all are stable countries with a high potential in raw materials," said Peter Buchholz, head of the German Raw Materials Agency (DERA). Political stability is a key factor on the market in particular because some raw materials are concentrated in just a few countries.

 Merkel has taken a sudden interest
in Latin America

An end to the boom is not in sight, certainly not where metals are concerned: the continent has copper, lithium and iron deposits as well as large zinc and lead deposits - not to mention various industrial metal alloys such as manganese, chrome, nickel and molybdenum.

According to DERA, 25 percent of all global investment in the exploration of new crude metal deposits goes to Latin America. With 26 percent, only slightly more is invested in North America. "Only 15 percent of all global exploration expenditures go to Africa," said Buchholz. "The figures exemplify the huge significance Latin America has for the mining and exploration sector."

Brazil, China and the US are the three most important raw materials suppliers - at least according a survey conducted among German businesses by the Federation of German Industries (BDI) in November. Chile and Mexico were also ranked among the top 10.

Catching up

Germany, however, has some catching up to do in the run on mineral resources. "Germany depends on functioning international raw materials markets," said Buchholz says. Canada, Australia, the US and above all China are competitors.

China is the most important trade partner for Brazil, Chile and Ecuador - and invests heavily in mining. By comparison, major German mining companies withdrew from the area in the 1990s because of a slump in prices. Ten years ago, they began trying to regain lost territory.

Most of the mined iron ore is used to make steel

As a result of the sluggish commitment, many raw materials are but commercial products for German businesses, which also gives them little influence on pricing. According to the Hanover-based Federal Institute for Geosciences and Natural Resources (BGR), costs surged by 25 percent in 2011 compared to the previous years while the scale of annual imports remained relatively stable.

The BDI survey shows that 61 percent of German businesses would like to see more political support. A year ago, a group of major companies including ThyssenKrupp, Bayer, Bosch, VW and BMW launched a Resource Alliance that has already been successful. The German government boosted grants for resource projects this year while so-called resource partnerships between countries aim to bring together potential business partners and pave the way for procurement contracts with German companies.

Endangering the environment

NGOs take a skeptical view of the global run on mineral resources. Mining increasingly pollutes rivers, groundwater and the air, Pirmin Spiegel, managing director of Germany's Misereor Catholic aid organization, said on the occasion of the presentation of a study documenting mining conditions and supply chains in the commodities sector. The study was commissioned by Misereor, Germany's Protestant Church "Bread for the World" campaign and the Global Policy Forum.

The group urged far tighter controls of businesses regarding human rights and labor violations. "The German government and the EU should commit companies to disclose financial transactions and proof of origin for resources," said Cornelia Füllkrug-Weitzel, president of "Bread for the World." Human rights and environmental protection are essential pillars of sustainable raw materials policies, she argues - and adds that is what the German government should take into account when supporting foreign trade and negotiating resource partnerships.

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Major EU countries to tackle tax havens

Deutsche Welle, 14 April 2013

Six major EU countries are set to increase the pressure on tax havens. At their meeting in Dublin, finance ministers announced an initiative against tax fraud and creative tax avoidance inspired by the US.

Pressure is growing on so-called tax havens, situated in the Caribbean and in Europe. At the meeting of European Union finance ministers in Dublin, six major EU member states, France, Britain, Italy, Poland, Spain and Germany presented a new initiative against tax evasion and tax avoidance.

In the future, the six countries plan to automatically exchange all relevant data on capital income with each other. That will enable fiscal authorities to collect taxes more easily from taxpayers who invest money in the EU.

The sudden momentum came from across the Atlantic, according to British Finance Minister George Osborne, who was responding to a reporter's question in Dublin.

"We actually have a new international standard emerging," he said. "With the countries represented here taking it up and using it as the basis of a multilateral European system, we're turning what was a bilateral US agreement into something approaching a global standard, which we want to obviously see promoted in Europe, but also more widely than that."

Osborne's statement referred to the Foreign Account Tax Compliance Act (FATCA), passed in the US in 2010, which is applied by an increasing number of countries worldwide in bilateral agreements with the US – among them Germany and Luxembourg. Under FATCA, those who don't pass on relevant data of potential American tax evaders to the US authorities are consequentially banned from doing business in the US. And since the US is the world's most important financial center, most countries and their banks have no choice but to accept FATCA.

 Austrian Finance Minister Maria
Fekter was on the defensive

Austria putting up resistance

Even Switzerland, famous for its banking secrecy, has adopted FATCA in a bilateral agreement with the US. But there has been criticism, with the Swiss daily newspaper the Neue Zürcher Zeitung speaking of a "tax diktat" by the big power, the United States.

The largest EU countries now want to adopt automatic data exchange as a standard for Europe. The last country to put up open resistance was Austria. In Dublin, Finance Minister Maria Fekter of the conservative party ÖVP called it an "attack on banking secrecy."

Banking secrecy has deep traditional roots in Austria and is anchored in the constitution. The proposed data exchange, she criticized, would lead to a "graveyard of data." "It's better to tax at the source," said Fekter. Austria does just that, deducting a tax at the source on returns on interest – in an anonymous way.

Luxembourg's Finance Minister Luc Frieden also criticized the initiative brought forward by the big six. "They want the small EU countries to just follow suit," Frieden said. Nevertheless, on Saturday (13.04.2013), three medium-sized EU member states, the Netherlands, Belgium, and Romania, also decided to join the initiative.

But Austria looks set to give in to pressure from the US, and seems likely to begin negotiations on adopting FATCA. Austria will try and push for an agreement similar to the one Switzerland has adopted, one which doesn't impose an automatic data exchange, so that the anonymity of bank depositors remains somewhat protected.

Brits put pressure on Cayman Islands

In Dublin, Britain's finance minister announced that the new transparency will also apply to tax havens in Britain's sphere of influence.

"First of all the Crown dependencies, the Channel Islands, the Isle of Man and so on: we have in the past couple of weeks concluded automatic exchanges of information, which are based on the US model, based on the model that we are adopting amongst ourselves here," said Osborne.

"With the overseas territories, like the Cayman Islands and the British Virgin Islands, we are in advanced stages of discussions. But I think they are in no doubt about what we expect of them."

The Cayman Islands - beautiful beaches
and an attractive tax system

People who want to evade taxes, Osborne added, should know that the hiding places are becoming few and far between.

Limit creative tax avoidance

German Finance Minister Wolfgang Schäuble stressed that the initiative of the six major EU countries isn't limited on returns on interest. It will also be applied to all forms of capital income by companies. In the future, systems that encourage creative tax avoidance, currently legal and present in many EU member states such as Luxembourg and Ireland, will also come under scrutiny.

"When the International Monetary Fund has its spring meeting in Washington next week, we will continue our efforts on a global level," he said. "We want to fight tax evasion through data exchange and we want to fight tax avoidance that happens when someone uses different tax systems or even tax havens. I believe a global movement is emerging, that will find the support of all Europeans."

But not all EU member states agree. Luxembourg benefits from direct investment by US companies, for example, which settle in the Grand Duchy because they benefit from the limited tax burden there, a prime example being online retailer Amazon.

'Surge in appetite' for stricter rules

At the moment, the EU member states are in competition with each other because of such legal tax avoidance systems. Countries like Cyprus were a popular destination for companies to register low-taxed subsidiaries, so-called letterbox companies. In the future, that system should lose its appeal, said Polish Finance Minister Jacek Rostowski in Dublin.

Schäuble said the IMF will continue
the efforts on a global level

Rostowski explained that Poland has tried to attract big international companies for many years. He wants the multinationals to tax the profits where they make them: in Poland. "As a host country we're always concerned about a reduction of the base for tax. We can only fight tax avoidance in cooperation with other states," he said.

EU Tax Commissioner Algirdas Semeta has urged member states to finally adopt the EU's Savings Directive that was negotiated in 2008. In Dublin, he said he could now see that happening over the coming weeks. But he warned that all questions concerning tax policy require a unanimous vote by all member states.

"The surge in the appetite of member states for progress and action in the fight against evasion is extremely welcome," said Semeta, seemingly surprised by the initiative launched by the six big countries. And yet, it's still up to the member states themselves to determine their tax systems and their tax rates.

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