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2008/03/04 (Tue)

Overlooking the Kremlin walls and the gates to Red Square, a huge campaign billboard shows President Vladimir Putin with the man he wants to succeed him as Russia's leader.

As a piece of propaganda, it would not have looked out of place in Soviet Russia.

A relaxed Mr Putin and his political protege, Dmitry Medvedev, are depicted sharing a light-hearted joke.

The message is clear - as Russians prepare to vote this Sunday, 2 March, their current president believes Mr Medvedev is the right man to run the country and its economy.

Political pressure

In many ways, the giant billboard represents the close-knit relationship between the Kremlin and big business in Russia.

As well as being Mr Putin's deputy prime minister, Mr Medvedev is the chairman of Russia's biggest state-run company, Gazprom.

But the way the billboard was put up also suggests something about the relationship between private business and political power in modern Russia.

Shortly after it appeared, reports in Russian media not controlled by the Kremlin suggested that advertising executives had been pressured into replacing adverts from paying customers with campaign billboards for Mr Medvedev.

Some advertisers complained they had been coerced into handing over prime space at heavily discounted rates for fears of reprisals if they did not comply.

Mr Medvedev's campaign team denied any meddling.

Whatever the truth, in the space of a few hours large commercial billboards advertising luxury Western goods had been replaced by a single giant image of Mr Medvedev side-by-side with Mr Putin.

Economic growth

In the years since the fall of the Soviet Union, Russia has embraced its own form of capitalism.

Under Mr Putin, the country has witnessed soaring economic growth, based largely on its huge reserves of gas and oil.

Russia's big businesses are flourishing, and the country boasts a booming stock exchange.

But critics say that stability has come at the expense of genuine democracy and business freedom in the country.

Few Russians see anything other than flattering election coverage of Mr Medvedev on television, with all major TV stations controlled and owned by the Kremlin or Gazprom.

Many private businesses too have faced increasing levels of government interference.

Mikhail Khodorkovsky, once Russia's richest man, is currently serving eight years in a Siberian prison after being convicted of fraud and tax evasion. Critics say it is the result of a political campaign by the Kremlin against him.

Western oil firms, too, have been pushed to hand over many of their assets in Russia to state-run corporations such as Gazprom.

Security links

In one of his first major speeches since his nomination, Mr Medvedev called for an end to Kremlin interference in Russian boardrooms.

Russian businesses, he said, needed more economic freedom.

 

Many hope that Mr Medvedev will be true to his word, if, as expected, he replaces Mr Putin as president following elections on Sunday.

But several key Russian businesses remain intertwined with the Kremlin.

Mr Medvedev has no background with the country's intelligence services, but many of the men at the top of Russian business have close links with both the government and the Federal Security Service (FSB), the organisation that replaced the KGB.

Sergei Ivanov, Russia's first deputy prime minister and a former FSB director, currently heads the United Aircraft Corporation, the recently forged conglomerate tasked with reviving the country's military and commercial aviation industry.

Igor Sechin, the Kremlin deputy chief of staff, who is also thought to have close links with the security service, is currently the chairman of Russia's state-run oil giant, Rosneft.

And of course Mr Putin himself famously served as a KGB officer in Germany during the Cold War.

Mr Medvedev's pledge to encourage more economic freedom will be welcomed by many in Russia.

But the country's well-connected business and political elite is unlikely to see any change in its influence as long as the Kremlin strives to hold the reins of big business in Russia.

PR
2008/03/04 (Tue)
The US government has begun a project to develop ways to spot terrorists who are using virtual worlds.

Codenamed Reynard it aims to recognise "normal" behaviour in online worlds and home in on anomalous activity.

It is likely to develop tools and techniques for intelligence officers who are hunting terrorists and terror groups on the net or in virtual worlds.

The project was welcomed by experts tracking terror groups using the net to organise or carry out attacks.

Growing threat

Brief details about Reynard came to light in a report sent to the US Congress by the Office of the Director of National Intelligence (ODNI) - which co-ordinates the work of US intelligence agencies.

In that report, which talked about the data mining efforts undertaken by the ODNI, Reynard was described as: "a seedling effort to study the emerging phenomenon of social (particularly terrorist) dynamics in virtual worlds and large-scale online games and their implications for the intelligence community".

Using publicly available data Reynard researchers will carry out observational studies to establish "baseline normative behaviors".

Once these are identified, Reynard will "then apply the lessons learned to determine the feasibility of automatically detecting suspicious behavior and actions in the virtual world".

"It's a positive step," said Andrew Cochran, founder and co-chairman of the Counterterrorism Foundation. "For a number of years we were behind in chasing jihadists' presence on the net and detecting it."

"That's a very sensible step at the moment," said Roderick Jones, a vice president of Concentric Solutions and a former special branch officer. "Just to feel their way around them and work out what new intelligence collection methods might be required to deal with this threat, because you won't be able to use traditional law enforcement methods."

New worlds

A senior intelligence officer at the ODNI said Reynard was in its very early stages and it was too soon to say which online worlds it would be studying. He added that any work on it would be purely for research rather than "operational" purposes.

 
"I think its highly unlikely terrorists would use things like Second Life or World of Warcraft as they do not have the necessary security," said Mr Jones.

"Terrorist use of the internet at the moment relies on password protected forums," he added.

Said Mr Cochran: "All of the major terrorist treatises have been distributed through the internet so taking it to a virtual world with multi-player role games is really an easy step."

It was inevitable that terror groups would make greater use of the internet and the possibilities that virtual spaces offered them, said Mr Jones.

"There's more a chance of things like Jihad worlds coming online in the next five years I think," he said.

The visual richness of virtual worlds made them good places to educate recruits about techniques, said Mr Jones.

Attack pattern

"We can see groups emerging in cyber spaces and virtual communities that would be wholly virtual," he said. "They would organise and radicalise in virtual worlds and attack using cyber methods without becoming a real world presence in any real way."

Many groups were likely to use the expertise and skills they learn in virtual worlds to target key net systems.

Ken Silva, chief technology officer for Verisign which oversees some of the net's core address books, said such an attack could be "devastating".

"We see a continuing growth in the amount of horsepower in the attacks that are directed at infrastructure servers," said Mr Silva.

 
"We are seeing a large shift from attacks that are directed at individual websites," he said. "The sophistication is getting a little smarter and they are attacking the infrastructure pieces behind them..., which is typically in most production environments the least invested in."

Some of the basic systems of the net, such as the Border Gateway Protocol (BGP) which helps data reach its intended destination, were open to attack.

An accidental misconfiguration of BGP in some routers in Pakistan caused the recent problems with YouTube which left many people unable to reach the video site.

"BGP is essentially a relatively unprotected protocol and is seriously vulnerable to disruption," he said. "Should that happen, it could take a very long time to correct that situation."

"This has to be fought at every level," he said.

2008/03/04 (Tue)
Israel's deputy foreign minister has called on Indonesia to play a more active role in the Middle East. The BBC's Lucy Williamson in Jakarta asks whether the government will listen.

 

This month, a letter appeared in Indonesia's main English-language newspaper.

It was signed by Israel's Deputy Foreign Minister Majalli Whbee and it called on Indonesia to expand its role in the Middle East, and to engage more with the challenges facing the Muslim world.

This might come as something of a surprise, given that Indonesia has no diplomatic relations with Israel.

It also happens to be the world's most populous Muslim country, is a member of Opec and enjoys good relations with Iran and Syria.

But Indonesia is the kind of Muslim country many western nations and their allies feel comfortable with - it is democratic, pluralist, and has had real success in tackling Islamic extremism.

No wonder some people see it as an ideal candidate to bridge the gaps between the Muslim world and the West.

To some extent, it is already involved in that dialogue. Indonesia took part in last year's Middle East peace conference in Annapolis, and is working on capacity-building programmes for the Palestinians.

But given its size and political spread, could it do more? Should it have a more prominent role in issues like the Israeli-Palestinian conflict, or Iran's nuclear programme?

'Active neutrality'

One of those who thinks it should is Wimar Witoelar, a former Indonesian presidential spokesman. He believes Jakarta is well-placed to talk to countries like Iran, and that the US should be asking for its help.

Indonesia, he says, has a made a virtue out of being "actively neutral" - a policy first introduced by Sukarno, the country's first president.

 

"At that time," says Witoelar, "it applied to communism and the West; now it applies equally to Muslim countries and the West."

There is support too from the Indonesian public for a more assertive role, particularly in the Middle East.

A straw poll on the streets of Jakarta found that more than half the people we talked to wanted Indonesia to support the Palestinians - with money or even troops - "because they are Muslims".

 

 

Religious identity in Indonesia is growing - the number of people wearing the headscarf has been rising for decades.

 

And while most Indonesians are proud of their pluralist democracy, they also feel a personal, emotional connection to the situations in Iraq, Afghanistan and the Palestinian Territories.

But is domestic desire for a greater role for Indonesia mirrored among Muslims in Pakistan, or Kosovo, or Egypt?

Broadly, the answer appears to be no.

Most Muslim countries around the world still look to the Middle East for leadership.

Religion 'not enough'

While Israel would like to see Indonesia use its democratic, Muslim weight in the region, Arab countries tend to see it as distant, different and lacking in religious authority.

US officials privately agree that Indonesia's influence in the region is limited.

 

As the BBC's Middle East analyst Magdi Abdelhadi points out, Indonesia has neither the historical weight of a country like Turkey nor the economic leverage of the Gulf.

Religion is simply not enough. To have any kind of real influence Indonesia would need to bridge thousands of kilometres, as well as gulfs in history, culture and language.

Playing a role as a Muslim power simply is not high enough on the government's agenda for leaders to attempt it.

Indonesia's foreign policy is much more focused on its economic and political role in South East Asia, and even its links with Africa, than with the Middle East.

The country's role in global peace and security comes 18th on its list of foreign policy objectives. Islam never gets a mention at all.

The reason is that the government - unlike some of its voters - does not like to see things in terms of religion.

Non-emotional consultants

Analysts like Anak Agung Banyu Perwitz point to Jakarta's unwillingness throughout most of its history to label its foreign policy decisions with an Islamic tag.

He details how Indonesia has supported all UN resolutions calling for the withdrawal of Israel from the occupied territories, and opposed the latest US invasion of Iraq.

But he says such actions have always been justified in terms of political pragmatism, economic development, or anti-colonialism - not Islam.

For example, with Israel, public opinion is seen to be strongly against opening diplomatic relations.

The foreign ministry has confirmed that Indonesia will never have diplomatic relations with Israel before the creation of a Palestinian state.

But the reason, it says, is not the Islamic outrage you can find expressed in homes and coffee shops, but the anti-colonial commitment enshrined in the country's constitution.

Indonesia's weight in the Middle East may be reduced as a result of this attitude.

But Wimar Witoelar believes it is this very quality that is Indonesia's unique selling point.

He admits that his country does not have the influence to tackle the big issues by itself and likens his country's role to that of consultants.

 

"We're useful because we use our mass in a non-emotional way."

2008/03/04 (Tue)
Almost half of Thailand's eligible voters failed to cast their ballots in the country's Senate elections - the second major vote in recent months.

Sunday's poll took place under a new constitution drafted by the military, which ruled for 18 months after ousting PM Thaksin Shinawatra in a coup.

The constitution gives wider powers to the upper house - but nearly half of its members are appointed, not elected.

This may be why turnout was reportedly lower than expected, say observers.

"We are satisfied with the voter turnout although the number was lower than our target [of 70%]," said Praphan Naiyakovit, who sits on the election commission, according to the Thai News Agency.

Votes are now being tallied after the election, in which about 56% of the electorate participated.

The election may have been overshadowed by the frenzy of excitement that followed the return from exile of Mr Thaksin on Thursday, says the BBC's Jonathan Head in Bangkok.

Election fatigue?

Another reason for voter apathy could be that the real electoral drama happened over two months ago, when the party led by Mr Thaksin's allies stunned the military government by winning the contest for the lower house, our correspondent says.

In addition, this election is only for just over half the Senate - as 74 of the 150 senators had already been appointed by a committee of judges and top bureaucrats.

This provision was inserted into the new constitution by the military-appointed drafting committee last year as a kind of guarantee that there would be no repeat of the extraordinary concentration of power in the hands of an elected prime minister, as happened when Mr Thaksin was in office.

The Senate has considerable muscle - it can sack cabinet ministers and the heads of all the key political oversight bodies, and it can impeach the prime minister.

Its members are supposed to have no ties to political parties.

But under the Thaksin administration, the upper house was filled with people either allied to him or related to his ministers, and correspondents said it was ineffective in challenging his governments.

The 74 newly-appointed senators appear to be far closer to the outgoing military government than the one now headed by Mr Thaksin's party.

This could for the first time produce some genuine battles between the lower and upper houses, our correspondent says.

2008/03/04 (Tue)
The UK tax authority, HM Revenue and Customs (HMRC), says it has paid an informant for data on British citizens who have bank accounts in tax haven Liechtenstein.

The information could help the UK recover unpaid taxes and comes as Germany steps up its own tax evasion investigation regarding Liechtenstein accounts.

Why has HMRC obtained the data?

HMRC says the information it has bought will recoup £100m in unpaid taxes from UK citizens who have evaded taxes using bank accounts in Liechtenstein.

It said it was seeking "to protect the UK exchequer from those who seek to hide behind secrecy laws".

Is the move legal?

HMRC has the right to pay for information that helps prevent tax evasion. It has held this power since 1892 although analysts say it is not widely used.

Unconfirmed reports say HMRC paid £100,000 for the data, after initially turning it down.

The Financial Times reported that Germany's success with a tax crackdown based on information from the same informant prompted the HMRC to reconsider its decision.

 

What's happening in Germany?

A view of Liechtenstein
The investigation has sparked a diplomatic row

Germany's tax crackdown came to light when Klaus Zumwinkel, the high-profile chief executive of Deutsche Post, was questioned by police over suspected tax evasion.

Reports have said hundreds of other people are being investigated after Germany paid 4.2m euros (£3.2m) in January 2006 for a list of wealthy Germans with money stashed in Liechtenstein.

The crackdown has sparked a diplomatic row with Liechtenstein; Liechtenstein's Prince Alois has accused Germany of placing "fiscal interests above the rule of law".

What penalties do UK tax evaders face?

 

Any UK resident found to have evaded tax will have to pay back the amount of tax owed plus interest. A further penalty of up to 100% of the tax due can also be imposed.

In certain circumstances, those found guilty of tax evasion can face a prison sentence of up seven years.

Richard Murphy of the Tax Justice Network, advises anyone with money in an Liechtenstein account to make a voluntary declaration to the HMRC.

"They will still face an investigation but the penalties will be much lighter," he says.

Who is the informant?

The informant is thought to be a former employee of Liechtenstein's LGT Bank.

The Wall Street Journal named him as Heinrich Kieber, a 42-year-old former archive worker who allegedly stole the data earlier this decade.

LGT has filed criminal charges alleging Mr Kieber stole digital copies of customer archive files, the journal reported.

 

What are some of Liechtenstein's attributes?

The Principality of Liechtenstein borders Austria and Switzerland. It has 35,000 residents and 75,000 businesses are registered there.

"It has an image of being secretive but it is major financial centre. An awful lot of extremely reputable business goes on there," said John Whiting, a tax partner at Price Waterhouse Coopers.

The Organisation for Economic Cooperation and Development lists Liechtenstein as one of only three states remaining on its blacklist of "uncooperative tax havens".

The other two are Andorra and Monaco.

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