www.canada.com MALCOLM MORRISON
CP Thursday, March 20, 2003

As zero-hour for a war in Iraq approached, the closely watched Dow average of blue-chip stocks rose yesterday to close up for a sixth session in a row - something that hasn't happened since August 2000.

Most North American stock markets gained on reports that U.S. planes attacked several artillery batteries in southern Iraq.

Hopes for a short war also fired up the U.S. dollar, in turn driving the Canadian currency lower by 0.37 of a cent to 67.45 cents U.S.

Lowered fears about a shortage of oil as a result of a new war in the Persian Gulf took crude prices beneath $30 U.S. a barrel.

While U.S. crude inventories remain low, OPEC producers other than Iraq and strife-torn Venezuela have been increasing production for weeks.

Generally, the tone on stock markets yesterday was of caution ahead of the expiry of the U.S. ultimatum to Saddam Hussein, even as U.S. forces began moving through the Kuwaiti desert toward Iraq.

"We had a pretty strong move in the last week that needs to be digested," said Arthur Hogan, chief analyst at Jefferies & Co. "We now know war is a matter of hours, not weeks. So this is definitely a wait-and-see day."

In New York, the Dow Jones industrials gained 71.22 points to 8265.45. The Dow has racked up more than 700 points in the last six sessions as investors bet any war will be short.

"It has sort of slowed down in intensity from what we've seen in the last couple of days, but the equity markets are proving remarkably resilient here," said Scott Kinnear, economist with MMS in Toronto.

Toronto's S&P/TSX composite index moved 14.87 points higher to 6453.48.

The Nasdaq lost 3.48 points to 1397.07 while the S&P 500 was ahead 7.57 at 874.02.

Generally, stock markets have been driven higher since the middle of last week as investors looked to the rally that followed the start of the 1991 Persian Gulf War and hoped that history would repeat itself.

"The general feeling out there is that there will be a quick war so you don't necessarily want to wait for the start of the war because by that time it will be too late," Kinnear said.

But there are plenty of reasons for caution, including the possibility of torched oil fields, use of biological weapons and terrorist attacks.

www.guardian.co.uk Mark Tran and agencies Thursday March 20, 2003

Oil prices jumped this afternoon following TV reports that oil wells in southern Iraq were burning out of control after apparent acts of sabotage.

The market reacted to a report by Fox News, based on information from military personnel in Kuwait, that fires south-west of the city of Basra had been burning for several hours.

The Arab satellite television channel al-Arabiya also said fires had broken out in Iraq's al-Rumeila field, also in the Basra area.

However, neither British nor American officials could confirm the reports. In a Pentagon briefing Donald Rumsfeld said: "We're not on the ground but I have seen indications of reports that the Iraqi regime may have set fire to three or four wells in the south."

On the London exchange, North Sea Brent crude surged to $27.25, up 50 cents a barrel, after hitting an early morning low of $25.53.

The jitters came despite an earlier statement by the Organisation of Petroleum Exporting Countries (Opec), which sought to calm oil markets by announcing that its members had pledged to maximize output to make up for any disruption in crude exports from Iraq.

Opec president Abdullah bin Hamad Al-Attiyah said: "I am herewith reiterating Opec's resolve to make up for any supply shortfall resulting from developing events. To this end, member countries have pledged to use, in the interim, their available excess capacities to ensure continued supply."

Iraqi crude exports, totalling 2m barrels a day, are expected to cease as the war intensifies.

Earlier today, officials from the cartel said that there was no need for such a move as oil prices had dropped to a three-month low. London's benchmark Brent crude oil fell to $25.5 a barrel overnight as traders expected a quick end to the one-sided war.

A week ago, a barrel of Brent crude was trading at $33.70 as stock markets around the world fell sharply on diplomatic wrangling between UN security council members.

Mr Attiyah said that the producer group was keeping in close contact with non-Opec producers and the Paris-based International Energy Agency (IEA), which oversees consumer stocks in 26 industrialised nations.

Iraqi exports ground to a virtual halt this week after the UN evacuated its staff overseeing Baghdad's oil-for-food programme. Saudi Arabia, the world's leading oil exporter, has already raised production well beyond 9m barrels daily - its allowed Opec quota is 8m - in part to cover shortages from strike-hit Venezuela.

The oil cartel has tried to keep prices within a price range of $22 to $28, with varying degrees of success. Opec's big fear is that prices will eventually crash, as they did after the end of the 1991 Gulf war.

www.nationnews.com Thursday 20, March-2003 by ROXANNE GIBBS

February 23: A man by the name of Colonel Michael Dewar, formerly of the British Army, tells a group of editors gathered in Sri Lanka that war against Iraq would take place in mid-March.

I was among the editors. Here is what he said: “The launch date would most likely be mid-March. That would allow for a second resolution at the United Nations. It would also allow British forces to get in place, train and acclimatise. It would allow United States logistic support to get in place and for axis from Turkey to be developed”.

About weather conditions there, he said: “Temperatures in Iraq will be about 100 degrees Fahrenheit during the day from April, thus the coalition will wish to finish the bombing campaign at the latest by early April.”

He also confessed that sandstorms were possible.

On the timeline: The war, he said, would last “inside one week”. “There will be an intense 48-hour aerial bombardment. There will then be a rapid advance on the main centres including Basra, Baghdad, Nasiriyah, Kirkuk and Mosul. The Iraqi forces will collapse or surrender very quickly.

“When he sees the writing on the wall, Saddam is likely to make a run for it, possibly to Libya. The United States and Britain would be quite happy with that. Having to put the man on trial would be complex and unpredictable in its consequences,” Dewar said.

In answer to a question, he stated emphatically: “This war has nothing to do with oil.”

And: “Thank God for America”, he said, to a question as to why America believed that it could dictate to another country how it should run its internal affairs.

“Would you have preferred it to be Russia running the world?” he said indignantly.

That was one side of the story.

February 26: Abdel bari Atwan, the editor-in-chief of a Pan-Arab newspaper in London, painted another picture when it was his turn to speak, days after after the colonel was safely back in London (there was no way the two could have been in the room together).

In an equally spirited and passionate address, he told editors that the expected war in Iraq had little to do with weapons of mass destruction, democracy, human rights, or the ignoring of United Nations demands; but was anchored in a sadistic need by Washington to remove Hussein from office.

Every time United States President George Bush gave a reason for the war and the reason was no longer valid, he came up with a new reason, Atwan said.

“The reason for this war is to make George’s mummy happy,” said the Arab editor who once interviewed bin Laden. “He would have avenged his father’s death threat from Saddam, so his mummy would be happy. He promised her to take care of the ‘bully’,” he said cynically, much to the amusement of many in the room.

His view was that the war would last much longer than the Americans anticipated.

He also spoke of Bush’s statements that Hussein had ties to bin Laden (the suspected terrorist of the 9/11 tragedy).

“Everybody in the Arab world knows that bin Laden hates Saddam and vice versa. bin Laden will be happy if Bush destroys Saddam . . . Bush must be the only person who doesn’t know that,” he said.

He described Bush in exactly the same words that Bush used to describe Saddam . . . sadistic, a dictator, a madman and a tyrant.

At the end of the presentation he made a dash for the airport where he caught the next flight back to London.

Left me saying hmmm . . . .

I remember, ten years ago, the world supported the defeat of Iraq after it had invaded Kuwait. At that time an international coalition went into the Persian Gulf and removed the Iraqis from Kuwait. Iraq had violated the sovereignty of another nation.

Now what has happened to America’s commitment then to: “a just world order based on respect for the rule of law and social justice and peace . . . .”

Since taking office, President George Bush has sought to tell Venezuela why its elected President Hugo Chavez should leave . . . . it has done all it could to engineer the ouster of Arafat, the Palestinian leader . . . our own Minister of Foreign Affairs Billie Miller is right when she asks: “Who will be next?”

How could we justify such a war in the name of peace . . . ?

And . . . the $25 million question – whatever happened to bin Laden?

www.zwire.com 03/20/2003

Cries for energy independence helps ethanol cause, unless another renewable source grabs market.

COLUMBUS - One impact Americans have felt with a looming war with Iraq has been an increase in gas prices.

Gas prices are currently averaging $1.68 a gallon - a 54-cent increase from this time last year.

"Probably the biggest economic impact we would see with a war with Iraq would be sustained high gas prices," said Matt Roberts, Ohio State University agricultural economist.

Ag impact. With natural gas prices following suit, it could mean higher-priced fuel and fertilizers for farmers, Roberts added.

Roberts said the United States imports more natural gas than it once did. Because natural gas is the primary feedstock from which anhydrous is made, that has some potential to impact farming profitability this year.

"I don't think this is shaping up to be a year like 2001 where there was a gross anhydrous shortage, but those gas prices will stay higher," Roberts said.

"We may see a slight shift from corn planting to soybean planting because corn production requires higher input costs."

Venezuelan card. The other piece to the crude oil price puzzle is the political unrest in Venezuela that has substantially reduced the flow of petroleum products.

Venezuela is the United States' third-largest oil exporter, behind Mexico and Saudi Arabia.

"Venezuela pretty much shot itself in the foot with this situation," said Roberts. "Many of our refineries were built to process Venezuelan oil, but they have had to alter their processes and it has made them less efficient."

Boost for ethanol? Carl Zulauf, an Ohio State agricultural economist, said that another impact a war with Iraq could have would be a renewed emphasis on U.S. energy independence.

This would result in the increased use of alternative fuels like ethanol and biodiesel, crop byproducts.

"In the short run, this is probably good for U.S. agriculture, in particular corn producers because of increased demand for ethanol," said Zulauf. "In the long run, the impact could be more problematic if some other source of alternative fuel emerges that displaces the demand for ethanol."

Roberts said in the past year, since harvest, ethanol has "been a savior to the corn market" because corn exports have been very weak.

Ethanol production has exploded over the last six months, to the point where ethanol is consuming around 8 percent of American corn production, said Roberts.

Biodiesel in the news. Biodiesel, another renewable fuel, is also making headlines in U.S. energy production.

Last March, the Minnesota legislature passed a law mandating a 2 percent inclusion of biodiesel into the state's petroleum diesel supply beginning in 2005.

Minnesota is the first state to require the addition of biodiesel in commercial diesel supplies.

Tax incentives. More recently, a bill was introduced to the U.S. Congress that would give biodiesel the same tax incentives that ethanol currently receives.

"Much of the tax incentive for ethanol is because it is exempt from the highway excise tax, but it has begun to impact the budget of the interstate highway system," said Roberts.

"If biodiesel is exempt from those same taxes, concerns are being raised that as the production of alternative fuels increases, it will seriously impact that budget and the money is going to have to come from somewhere."

More emphasis on alternative fuels, however, would provide support for farm prices.

"Over the course of the year, my feeling is that national prices have been a dime higher because of increase in our ethanol production," said Roberts

Venezuela case study: Iron deficiency is costly, finds study

20/03/03 Anaemic adults and children cost developing countries billions of dollars in lost productivity, according to a recent study.

"One in three of the world's population suffers from anaemia so this has tremendous economic consequences," said Sue Horton, a University of Toronto economics professor and lead author of the study, ‘The Economics of Iron Deficiency’. The economic loss due to iron deficiency in South Asia alone is staggering: close to $4.2 billion is lost annually in Bangladesh, India, Sri Lanka and Pakistan. Adults who lack sufficient iron in their diets are more lethargic which leads to lower productivity, while the motor and cognitive development of small children is also impaired.

Horton and co-author Jay Ross, an epidemiologist from the non-profit organisation Academy for Educational Development, calculated the economic impact of iron deficiencies in 10 developing countries in South Asia, Central America, Africa and the Middle East. They found that, on average, a country loses 0.6 per cent of its gross domestic product (GDP) due to physical productivity losses from adults lacking iron. When learning and motor impairments in anaemic children are added, the figure rises dramatically to 4 per cent of its GDP.

"A loss of 4 per cent of GDP even in poor countries translates into billions of dollars lost," said Horton.

Horton says iron fortification is extremely important and inexpensive. For example, it costs only 12 cents (US) per person per year to fortify wheat flour in Venezuela – and the payback is tremendous for a country's economy.

"With every dollar you invest, you receive $36 back in physical and cognitive productivity. Those are huge returns," he said.

The study, funded by Micronutrient Initiative, was published online in the February issue of the journal Food Policy.