THE INDEX — November 30, 2009

Iranian Press TV reported on Sunday Iran’s intention to construct ten additional uranium enrichment facilities. President Mahmoud Ahmadinejad has requested Iran’s Atomic Energy Organization generate 20,000 megawatts of electricity for domestic use through 500,000 additional centrifuges by 2020. Vice President Ali Akbar Salehi explained that the decision was a direct response to the recent criticisms from the United Nations, and especially the International Atomic Energy Agency (IAEA) and the P5+1 (the five permanent members of the Security Council, plus Germany). “We had no intention of building many facilities like the Natanz site,” Salehi said, “but apparently the West doesn’t want to understand Iran’s peaceful message.” In Paris, French Foreign Minister Bernard Kouchner labeled Iran’s decision “a bit childish.” Also on Sunday, more than 200 members of the Iranian parliament signed a letter urging Ahmadinejad to restrict the IAEA’s presence in Iran, and some called for Iran’s withdrawal from the Nuclear Non-Proliferation Treaty (NPT). Withdrawal would eliminate the West’s already limited inspection capability in Iran, but in so doing would signal malicious intent—beyond Iran’s stated peaceful intent for civilian energy—that might prompt harsher sanctions and perhaps even preemptive military action from Israel or others. As to Iran’s peaceful nuclear power generators, Russian sources told Reuters on Monday that the Bushehr plant—which Iran has contracted to Russia for an estimated $1 billion—will likely begin generating electricity in March 2010, coinciding with the Russian New Year.

Results from the Honduran presidential election, in which voters have appeared to reject President Manuel Zelaya, are putting the United States and Brazil at odds over the future of the Latin American nation. Zelaya, who was ousted from the presidency in a military coup in June, apparently lost to opponent Porfirio Lobo, who according to provisional election results won about 56 percent of the vote. The United States praised the vote; a U.S. State Department spokesman said the “the Honduran people took a necessary and important step forward.” But Brazil, which has hosted Zelaya in its embassy in Tegucigalpa since mid-September, said it would not recognize the results because of the military coup. “Brazil will maintain its position because it’s not possible to accept a coup,” said Brazilian president Luiz Inacio da Silva. Zelaya has called the election a “fraud” and tried to get Hondurans to boycott the vote.

The government of Dubai announced on Monday that it will not guarantee the debt of the investment firm Dubai World. The Director General of Dubai’s finance department, Abdulrahman al-Saleh, warned that creditors are responsible for their own lending decisions. “Creditors need to take part of the responsibility for their decision to lend to the companies. They think Dubai World is part of the government, which is not correct.” The federal United Arab Emirates (UAE) pledged cautiously on Monday to lend to Dubai banks, hoping to allay a crisis of confidence similar to, if on a far smaller scale, that which crippled the global economy last fall. “We will look at Dubai’s commitments and approach them on a case-by-case basis,” an anonymous UAE official told the press. “It does not mean that Abu Dhabi will underwrite all of their debts.” The Dubai finance department last week requested a six-month standstill on all Dubai World debts, including that of its property development subsidiary, Nakheel, totaling some $59 billion. Dubai World, a major impetus for Dubai’s stellar economic growth, had invested in lavish real estate projects, including artificial islands in the Persian Gulf and properties in Manhattan and Las Vegas. The standstill request surprised global investors who believed, and were told by Dubai officials, that the emirate would face no financial troubles in the near future. Mr. Saleh cautioned that global markets were overreacting to the news of Dubai’s standstill request and that, while firms will take losses in the near future, they will emerge stronger as the government restructures the businesses.

Trade chiefs from over 150 countries gathered in Geneva as the World Trade Organization (WTO) opened its first ministerial conference in four years. The conference, which commenced on Monday, was arranged as “a platform for ministers to review the functioning” of the multilateral trade body, said Director-General Pascal Lamy. Though it is not a negotiating forum, Lamy still urged the ministers to speed up their progress on the eight-year-old Doha Development Round, the WTO’s currently stalled round of trade negotiations. “The best way of strengthening the [international trade] system is concluding this round,” said Lamy, as world leaders set a new 2010 target to conclude the process. “Now we need action, concrete and practical action, to close the remaining gaps.” Developing countries echoed his call for urgency; the Cairns group, an alliance of 19 nations that account for more than 25 percent of the world’s agricultural exports, expressed its dismay at the lack of progress on Doha. The group of 33 developing countries (dubbed the G-33) also called for action, noting that it would stand firm to preserve developing-country interests as the Doha round proceeds, particularly on the contentious special safeguard mechanism (SSM)—the right to retain protective tariffs on agriculture should imports surge or prices drastically fall—that led to last year’s breakdown in talks. The conference (which will conclude on Wednesday) is set to address other trade-related issues as well, such as improving the resolution of trade disputes, preventing protectionism, enlarging membership, and cooperating with other international organizations.

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