IMF Head Says World Economic Situation ‘Serious’

“All developed countries are suffering from the slowdown in the US putting the world economy in a serious situation, International Monetary Fund (IMF) Managing Director Dominique Strauss-Kahn said on Monday. …  

He warned that emerging market growth could also be dragged down by the outlook in the US. ‘Fortunately, emerging markets continue to have strong enough growth and will continue to drive global growth. Nevertheless, it is not impossible that it may have an effect even on emerging market countries, that growth is weaker than forecast.’ …” [Reuters/Factiva]

  AP reports that “The head of the IMF called the global economic situation ‘serious’ and said markets worldwide had responded skeptically to a US stimulus plan. Strauss-Kahn stressed that a US recession would affect economies across the globe. …” [The Associated Press/Factiva]

Carbon Revenues Can Aid Climate Fight-Barroso

“The European Commission wants EU states to spend on clean energy technologies a fifth of the billions of Euros they raise from selling emissions permits to high-polluting industry… [Commission President Jose Manuel Barroso] said on Monday. …  

Brussels will announce on Wednesday a raft of new climate change policies, to kick in from 2013, aiming to boost low carbon-emitting businesses while trying not to harm traditional high-polluting industries such as steel. …He said Europe was lagging in so-called venture capital funding for start-up renewable energy companies. …” [Reuters/Factiva]

            Dow Jones notes that “The European Commission is willing to consider forcing companies from non-EU countries exporting goods to the EU for their emissions in a bid to stop EU companies being placed at a competitive disadvantage, Barroso said in speech in London Monday. …  

Barroso said the commission would be willing to do so only if such a system is compatible with World Trade Organization requirements. …” [Dow Jones/Factiva]

  AFP writes that “EU plans to cut greenhouse gas emissions could cost at least EUR 60 billion a year, Barroso said... ‘Taking action is not cost free, although we think we can limit the cost of our proposals to around 0.5 percent of GDP’ he said…

Barroso's total estimate, which will apply for the next 12 years, counts on the 27 EU nations undertaking all the commission's recommendations, in a package to be unveiled Wednesday, in an extremely cost efficient manner. … 

The commission's package aims to strengthen the EU's emissions trading system, set targets for renewable energy use and review rules on national aid for environmental purposes. …” [Agence France Presse/Factiva]

FAO Sees Record World Food Prices Staying

“Record food prices are unlikely to ease in the foreseeable future, as high grain demand and low stocks mean the world remains vulnerable to possible food shocks, a UN expert said on Monday.  

Efforts to increase wheat output may not be enough to offset soaring demand and bring the cereal off the all-time price highs it is continuing to hit, said Abdolreza Abbassian, grains economist at the Food and Agriculture Organization (FAO). … 

He said that if there is the slightest weather problem next year in any major producing country or in any major developing country importer that also produces, such as China or India, wheat prices will soar again. With global stocks low, a major weather disaster would push the world into real food shortages, he added. …  

Abbassian said… [the] FAO was now less optimistic for increased 2008 wheat production than it had been in its last Food Outlook report, issued in November. …” [Reuters/Factiva]

In related food prices news, FT writes that “Scarcity of water and arable land means that the boom in food prices could last longer than most expect, a new study has warned.

The report, to be published on Tuesday by the UK-based consultants Bidwells Agribusiness, said the boom – until now fuelled by rising demand from emerging countries and the biofuels industry – would be exacerbated by supply constraints. …

Instead of focusing on the current factors behind rising food prices, such as growing populations, increasing income levels and new demand from the biofuels industry, the report for the first time examines the limitations faced by farm production in the medium term. It said water and land scarcity, together with slow improvement in agronomics, would be key factors shaping food production. …” [The Financial Times (UK)]

Japan Should Focus More Aid On Africa: Expert Panel

“Japan should allocate its foreign aid more ‘strategically’ to maintain its diplomatic clout, including focusing more assistance on Africa for sustainable development, an expert panel said Monday in an interim report on Japan's aid policy.  

The report submitted to Foreign Minister Masahiko Komura also recommended establishing a dialogue channel to strengthen cooperation between the government and private sector, especially Japanese companies and nongovernmental organizations operating in African and other aid recipient nations. …  

The panel also warned that continued cuts in ODA budgets have made it ‘difficult for Japan to flex its diplomatic muscles’ … ‘For Japan not to show its presence here (in Africa) will be to lose face as a key donor nation,’ the panel member said on condition of anonymity in briefing reporters. …” [Kyodo News/Factiva]

Commentary: A Pandemic That Wasn't But Might Be

“Last year, for the first time since avian flu emerged as a global threat, the number of human cases was down from the year before. As the illness receded, the scary headlines - with their warnings of a pandemic that could kill 150 million people - all but vanished.  

But avian flu has not gone away. Nor has it become less lethal or less widespread in birds. Experts argue that preparations against it have to continue, even if the virus's failure to mutate into a pandemic strain has given the world more breathing room.  

            There were 86 confirmed human cases last year compared with 115 in 2006, according to the World Health Organization, and 59 deaths compared with 79. Experts assume that the real numbers are several times larger, because many cases are missed, but that is still a far cry from a pandemic. …  

The world is clearly more prepared. Vaccines have been developed. Stockpiles of Tamiflu and masks have grown. Many countries, cities, companies and schools have written pandemic plans. …In the worst-hit countries - all poor - laboratories have become faster at flu tests. Government veterinarians now move more quickly to cull chickens. Hospitals have wards for suspect patients, and epidemiologists trace contacts and treat all with Tamiflu -a tactic meant to encircle and snuff outbreaks before the virus can adapt itself to humans. … 

Despite the culling of hundreds of millions of birds and the injection of billions of doses of poultry vaccine, the virus is out of control in some of the most populous countries - though exactly which ones are in dispute, because some are touchy about conceding that they cannot rid their flocks of it. …  

Many small mutations have been recorded that seem to make the virus more adaptable to humans and more resistant to known drugs, but no combination of those producing a superstrain has yet emerged. … Some scientists argue for vaccinating millions of people as a precaution. One dose, even if it is based on a three-year-old strain, might protect against death, if not infection. A second, fully protective dose could be made up from whatever strain has gone pandemic.  

Right now, said Dr. Klaus Stohr, who was chief of flu vaccines for the WHO and now does the same for Novartis, it would take manufacturers about one year to produce a billion doses of any vaccine based on a new pandemic strain. But the pandemic would have circled the globe within three months. …” [The New York Times]

Also in this edition; briefly noted…

Rising oil revenues mean Sudan will give free healthcare to children under five and waive fees for caesarean sections from February 1 in a move that will cost $20 million a year, a senior health official said on Monday. [Reuters/Factiva]

  Dubai World Group's Jafza subsidiary signed an $800 million deal on Monday to build and run a special economic zone in Senegal, the latest in a series of Arab investments in the West African country. Dubai World Chairman Sultan Ahmed Bin Sulayem said construction would start before the end of the year on the first phase of the project, covering 650 hectares next to a planned international airport 45 km (28 miles) from Dakar. [Reuters/Factiva]

Several major European chemical firms face possible debarment by the World Bank following allegations they colluded to overcharge a Bank-funded anti malaria program in India. The firms, along with a number of other Indian and European companies, also face possible punishment from the government of India. [The Wall Street Journal/Factiva]

Morocco Prime Minister Abbas El Fassi met Monday in Rabat, with World Bank Vice-President for Middle East and North Africa, Daniela Gressani to discuss the progress of development programs in Morocco and the means to strengthen their cooperation in various fields. [Xinhua/Factiva]

Israeli Defense Minister Ehud Barak announced Monday night that he was lifting some of the restrictions imposed on Gaza and that on Tuesday morning he would allow delivery of a week's supply of industrial diesel fuel for the local power station, as well as 50 trucks of food and medical supplies. [The International Herald Tribune]

Annual inflation in Iraq has fallen dramatically, hitting 12 percent in December 2007, compared with 65 percent a year earlier, the central bank said in a statement seen on Monday. [Reuters/Factiva]

Despite a slowdown, Poland should continue to enjoy robust growth this year but the government must keep watch on rising inflation and labor shortages, the International Monetary Fund said Monday. [Agence France Presse/Factiva]

According to a study by the World Bank's independent evaluation unit to be released today electric grids expand mostly to areas near urban clusters, rarely to remoter areas. [The Wall Street Journal/Factiva]

The EU and the US said on Monday they still hoped to seal a long-delayed global trade deal in 2008, and trade ministers this week could help pave the way for a breakthrough soon. [Reuters/Factiva]

This year is crucial for the outcome of the Doha Round of global trade talks, World Trade Organization Director-General Pascal Lamy has said. It's an Olympic year for China and maybe an Olympic year for Doha, too, he told China Daily after he met Premier Wen Jiabao and the ministers in charge of commerce, agriculture, finance and foreign affairs last week. [China Daily/Factiva]