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Report: US shipping arms ahead of strike on Iran
YNet News

Scottish newspaper says US transferred ammunition containers with 'bunker-buster' bombs to Diego Garcia in Indian Ocean. Expert: They are gearing up totally for the destruction of Iran.

Hundreds of powerful US “bunker-buster” bombs are being shipped from California to the British island of Diego Garcia in the Indian Ocean ahead of a possible attack on Iran, The Herald reported Wednesday.

The Scottish newspaper said the American government signed a contract in January to transport 10 ammunition containers to the island. According to a cargo manifest from the US navy, this included 387 “Blu” bombs used for blasting hardened or underground structures, The Herald reported.

The report quoted experts as saying that the bombs are being put in place for an assault on Iran’s nuclear facilities.

According to the newspaper, although Diego Garcia is part of the British Indian Ocean Territory, it is used by the US as a military base under an agreement made in 1971.

The report said Superior Maritime Services, a shipping company based in Florida, , will be paid $699,500 to transport many thousands of military items from Concord, California, to Diego Garcia.

The cargo includes 195 smart, guided, Blu-110 bombs and 192 massive 2000lb Blu-117 bombs, said The Herald.

Dan Plesch, director of the Center for International Studies and Diplomacy at the University of London and co-author of a recent study on US preparations for an attack on Iran was quoted by the Scottish newspaper as saying, “They are gearing up totally for the destruction of Iran. US bombers are ready today to destroy 10,000 targets in Iran in a few hours."

According to Plesch, US President Barack Obama may decide that it would be better for the US to act instead of Israel.

“The US is not publicizing the scale of these preparations to deter Iran, tending to make confrontation more likely,” he was quoted by The Herald as saying. “The US ... is using its forces as part of an overall strategy of shaping Iran’s actions.”

According to The Herald, the British Ministry of Defense has said in the past that the US would need permission to use Diego Garcia for any attack. It has already been used for strikes against Iraq during the 1991 and 2003 Gulf wars.

The report said about 50 British military staff are stationed on the island, with more than 3,200 US personnel. Part of the Chagos Archipelago, it lies about 1,000 miles from the southern coasts of India and Sri Lanka, well placed for missions to Iran.

http://www.ynetnews.com/articles/0,7340,L-3863920,00.html


World Bank tells China to tighten policy
By Alan Wheatley, China Economics Editor

BEIJING- (Reuters) — The World Bank raised its 2010 growth and inflation forecasts for China and recommended a tighter monetary policy as well as a stronger exchange rate to restrain inflation expectations and asset bubbles.

The bank revised its projection of gross domestic product growth this year to 9.5 percent from 8.7 percent in its previous China Quarterly Update in November and 9.0 percent in a regional report released in January.

For 2011 the bank penciled in GDP growth of 8.7 percent -- exactly the same rate China enjoyed in 2009 as the economy responded to massive monetary and fiscal stimulus.

"In China the economy has held up very well during the global crisis and growth prospects for this year and next year remain quite good," Louis Kuijs, senior economist in the bank's Beijing office, told a news conference on Wednesday to issue the report.

Growth this year of 9.5 percent, which was the median forecast of economists in a recent Reuters poll, would vault China past Japan and make it the world's second-biggest economy.

UBS also raised its 2010 GDP forecast on Wednesday, to 10 percent from 9 percent, citing the momentum of domestic demand and a likely recovery in net exports back to pre-crisis levels.

The World Bank now expects consumer prices to rise by 3.7 percent on average this year -- it had forecast 2.0 percent in November -- and by 2.8 percent in 2011.

"We think that inflation risks remain modest, in large part because of the global context. Nonetheless, the macro stance needs to be noticeably tighter than in 2009 to manage inflation expectations and contain the risk of a property bubble," the Washington-based lender said.

Meeting this year's target of 7.5 trillion yuan in new loans -- down from a record 9.6 trillion yuan in 2009 -- would be important to anchor inflationary expectations. Higher interest rates would make the tightening more convincing, the bank said.

"The world economy is still very subdued, but China's growth has been strong and, unlike in most other countries, overall output in China is, according to our calculations, rather close to its potential -- which means there is not a lot of spare capacity," Kuijs said.

STRONGER YUAN

As for the yuan, a stronger exchange rate would help dampen inflation pressure by lowering the price of imports and toning down demand. It would also help rebalance China's growth toward services and consumption and away from industry and investment.

"Over time, more exchange rate flexibility can enable China to have a monetary policy independent from U.S. cyclical conditions, which is increasingly necessary," the report said.

Yet the bank coupled its stress on the need to contain inflationary expectations with a warning that wrestling inflation down to very low levels might hinder the relative price changes required in such a rapidly growing economy.

"For instance, China needs to increase administrative prices for resources and utilities that are necessary to adjust the structure of the economy. And higher prices for agricultural products and higher migrant wages can help boost rural incomes and reduce urban-rural inequality..." the bank said.

"It would be unfortunate if such desirable developments were suppressed because of concerns about moderate inflation."

China has set a 3 percent inflation target this year, but the bank said a rate of 4-5 percent is not a major problem in many emerging markets in the throes of reform and development.

The bank described the price risks facing China this year as relatively modest. The big dangers were higher asset prices and strained local government finances, stemming from unprecedented lending by state-owned banks unleashed to prop up growth.

Overall, China's prospects are much less uncertain than a year ago at the peak of the financial crisis, the report said.

As government-led investment slows, the bank expects the composition of growth in 2010 to shift markedly.

Total investment will expand at only half last year's rate, but real estate spending will provide a big boost. Consumption should remain strong. Overall, domestic demand will contribute 9.1 percentage points to this year's projected GDP growth.

Net exports will account for the remaining 0.4 percentage point as global demand for Chinese goods recovers. Last year, by contrast, net exports shaved 3.9 points off headline growth.

(Reporting by Alan Wheatley; Editing by Ken Wills)

http://www.newsdaily.com/stories/tre62g0q3-us-china-economy-worldbank/


Obama pushes climate change in White House meeting
By Jeff Mason and Richard Cowan

WASHINGTON-(Reuters) — President Barack Obama, weighing in on the Senate's efforts to pass a climate change bill, gathered Republican and Democratic lawmakers on Tuesday to try to jumpstart an overhaul of U.S. energy policy.

Obama called the meeting at the White House with influential senators and members of his cabinet to reinvigorate one of his top domestic and foreign policy priorities, which advisers admit has suffered from the president's focus on healthcare reform.

The House of Representatives passed a bill that would require the United States to reduce its emissions of greenhouse gases by 17 percent by 2020 compared with 2005 levels, roughly the same goal Washington has backed at international talks to combat global warming.

But the Senate has not passed a similar measure and a bipartisan group of senators including Democrat John Kerry, Republican Lindsey Graham and independent Joe Lieberman are expected to produce a bill soon.

The trio did not present the outlines of their unfinished bill -- they aim to have one by the end of the month -- and no concrete breakthroughs happened during the Obama meeting.

"We're moving very rapidly," Kerry told reporters, adding there will be a series of meetings on the issue next week.

In his overhaul of U.S. energy policy, Obama wants to reduce dependence on foreign oil, fight global warming and increase the use of renewable sources such as wind and solar, while also building new nuclear power plants.

Some Republicans have said they would support less sweeping measures but Graham said there would not be enough Senate votes for a bill that did not include steps to fight climate change.

"There's not 60 votes for energy only," he said of a bill that would focus solely on mandates for renewable power. "Only when you marry up climate change, cleaning up the air, with energy independence will you get the transformational aspects ... that I'm hoping for."

A U.S. law is seen as a key ingredient for an eventual U.N. agreement to follow up on the emissions-capping Kyoto Protocol, which runs out in 2012. The Senate's failure to pass a bill hampered the U.S. position at talks in Copenhagen in December.

MOVING FORWARD

Obama's meeting on Tuesday -- his first with lawmakers on a broad scale to discuss the Senate legislation -- came just as China and India joined almost all other big greenhouse gas emitters in formally signing up to the non-binding climate accord that was reached during the Copenhagen summit.

Senator Susan Collins said Obama, a Democrat, told the group he wanted a bill completed this year.

"The president expressed his strong support for a bipartisan effort to establish clean energy incentives that will create jobs and reduce our dependence on foreign oil," a White House aide said.

"(The senators) agreed to continue the dialogue about a path forward for comprehensive energy legislation."

Lawmakers must move fast if the bill is to get an airing before summer, an unofficial deadline looming before intense campaigning starts for congressional elections in November that could change the balance of power in both houses.

Lieberman said the meeting showed Obama would make the bill one of his major goals this year and he left open the possibility of a controversial cap-and-trade system for the utility sector -- under a new name.

"We don't use that term any more," Lieberman told reporters before the meeting, referring to cap-and-trade. "We will have pollution reduction targets."

The issue of a cap-and-trade system, which would let companies buy and trade permits to emit greenhouse gases, is one of several open questions about how the eventual law will look. Senate leaders are trying to accommodate requests from a myriad of colleagues to garner enough support for passage.

Ohio Democratic Senator Sherrod Brown, who fears his state's factories could shed jobs under a climate bill, is pushing hard for an import provision that would tax goods from countries such as China and India if they do not have strong climate controls.

"I think we're very close on that," Brown told reporters about the provision.

Senator Lisa Murkowski, a Republican from Alaska who has frustrated the Obama administration by backing measures to block the Environmental Protection Agency from regulating greenhouse gases, is pushing for a bill that would focus on mandates for renewable energy rather than a cap-and-trade market on power plants and industry.

Obama has resisted calls to split the energy and climate aspects of a "comprehensive" bill, just as he has opposed splitting his healthcare reform measures into smaller steps.

(Additional reporting by Timothy Gardner and Ayesha Rascoe; Editing by Russell Blinch and John O'Callaghan)

http://www.newsdaily.com/stories/tre62833h-us-climate-usa/