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POLITICAL ECONOMY
Rule of law index finds faults in China, Russia, US
by Staff Writers
Washington (AFP) June 13, 2011

IMF hit by sophisticated cyberattack: report
Washington (AFP) June 11, 2011 - The International Monetary Fund (IMF) was the target of a sophisticated cyberattack earlier this year, the New York Times reported Saturday, quoting senior officials at the world lender. The global financial institution -- which has been spearheading the response to the eurozone crisis in recent months -- has detailed and market-moving information on the fiscal shape of the world's economies. "This was a very major breach," an IMF official said, according to the Times, adding that the months-long attack began before former IMF chief Dominique Strauss-Kahn was accused of sexually assaulting a hotel maid in Manhattan. The IMF could not be reached Saturday, but the Times quoted its spokesman as saying the fund was investigating an incident and was "fully functional."

The Times also reported that the World Bank, which is headquartered across the street from the IMF, had cut the computer link between the two entities out of caution over the incident. The World Bank could not be reached either. The Times said IMF staff were informed of the attack on Wednesday but the fund did not make any public announcement. The officials cited by the Times declined to say where the attack might have originated, but the newspaper said it could have been carried out by "spear phishing," where a user is tricked into clicking on a malicious web link or running a program that gives an outsider access to a network. Earlier this month, the vigilante hackers group "Anonymous" declared an online attack against the IMF over the strict conditions imposed by its bailout for Greece.

An annual survey of the rule of law around the world released Monday sees weak protections for fundamental rights in China, "serious deficiencies" in Russia, and problems with discrimination in the United States.

Sweden and Norway scored highest on the World Justice Project Rule of Law Index, which ranks countries on such key areas as whether the government is held accountable, there is access to justice, rights are protected and crime and corruption is prevented.

"Achieving the rule of law is a constant challenge and a work in progress in all countries," said Hongsia Liu, the executive director of the project, which was funded by a grant from the Bill and Melinda Gates Foundation.

He said the index was "not designed to shame or blame, but to provide useful reference points for countries in the same regions, with comparable legal cultures and similar income levels."

In the case of China, the report noted that the Asian giant had made "major improvements" in the quality, effectiveness and accountability of its legal institutions.

It came in second after Brazil among the so-called BRIC group of emerging powers -- Brazil, Russia, India and China.

But more progress was needed in the area of judicial independence, the report said.

"Indicators of fundamental rights are also weak, including labor rights (ranking 61st out of 66), freedom of assembly (ranking 66th), and freedom of speech (ranking 66th)," it said.

On India, the report found strong free speech protections, an independent judiciary, and a relatively open government with functioning checks and balances.

"However, the unsatisfactory performance of public administrative bodies keeps generating a negative impact on the rule of law," it said.

India's courts are congested, processing of cases is slow and law enforcement is deficient, with significant corruption and police discrimination and abuses "not unusual," it said.

Of the BRIC countries, Russia fared the worst in the rankings.

"The country shows serious deficiencies in checks and balances among the different branches of government (ranking 55th), leading to an institutional environment characterized by corruption, impunity, and political interference," it said.

"Violations against some fundamental rights, such as freedom of opinion, freedom of association, and arbitrary interference of privacy are areas of concern," it added.

The rule of law was also found wanting in countries like Iran, long at odds with the international community over its nuclear program and which ranked last in the world on protection of fundamental rights.

"As a state-dominated country, law enforcement in the country is relatively strong, but often used as an instrument to perpetrate abuses and favor the elites," the report said.

"Government accountability is weak (ranking 59th globally and last within the region), and corruption is prevalent. Courts, although fairly efficient, are subject to corruption and political interference."

In Latin America, Venezuela was rated "the worst performer in the world in accountability and effective checks on the executive power.

"Corruption appears to be widespread (ranking 54th), crime and violence are common (ranking 64th), government institutions are non-transparent, and the criminal justice system is ineffective and subject to political influence (ranking 66th).

"The country also displays serious flaws in guaranteeing respect for fundamental rights, in particular, freedom of opinion and expression, and the right to privacy," it said.

Western Europe was the top performing region of the world with most countries, except Italy, getting high marks in most categories.




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Romney blasts Obama on jobs
Washington (AFP) June 13, 2011 - Republican White House hopeful Mitt Romney unleashed a hard-hitting campaign ad Monday blasting President Barack Obama's handling of the economy, the top issue on voters' minds in the 2012 race.

Romney himself does not appear in the video, which turns Obama's June 3 comment that "there are always going to be bumps on the road to recovery" into an attack highlighting historically high unemployment of about 9.1 percent.

Instead, the ad shows people lying in a road, then standing up each in turn to declare "I'm an American, not a bump in the road" and holding up a placard with their name followed by "stands with Mitt."

The ad drew an immediate response from the White House, with spokesman Jay Carney telling reporters that "as we emerge from this recession it is not going to be a straight road, there are going to be some bumps on the road."

"These are common phrases in the English lexicon and I think that his meaning is clear, which is that we are heading in the right direction, but it is not necessarily a smooth path," said Carney.

"That is precisely because of the devastating impact the recession did have on the economy and the unemployment in this country," said the spokesman.

Romney's camp released the video ahead of a Republican presidential debate in New Hampshire, where the former Massachusetts governor was sure to face criticism tied to his health care overhaul, which conservatives have charged closely resembles Obama's own health law which they despise.

With Americans overwhelmingly singling out the economy and joblessness as the top issue on their minds, the president and his Republican rivals were sure to battle over the issue right up to the November 6, 2012 elections.

Romney has repeatedly hit Obama over the "bumps in the road" remark, made in a speech to automotive workers in Toledo, Ohio, in which he listed "some headwinds that are coming at us."

The president listed high gas prices, "economic disruptions" in the wake of the earthquake and tsunami in Japan, and instability in the Middle East among the "bumps in the road" and said the economy was "taking a while to mend."





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Japan core machinery orders down 3.3% in April
Tokyo (AFP) June 13, 2011
Japan's core private-sector machinery orders, a leading indicator of corporate capital spending, posted a surprise decline of 3.3 percent in April, government data showed on Monday. The negative core data, which exclude volatile demand from power companies and for ships, followed a revised 1.0 percent gain in March and missed forecasts for a 1.2 percent increase, according to a Dow Jones New ... read more


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