Moscow and Washington warn each other to ease tensions in Ukraine

Moscow and Washington are urging each other to exert influence on the two sides in the Ukraine crisis in the absence of any sign that last week’s Geneva accord is being implemented.

Pro-Russian separatists are still refusing to vacate buildings they’ve occupied in east Ukraine, and ultra-nationalists are being blamed for the weekend’s shootout at a separatist checkpoint.

In a web chat with a Russian radio station, the US State Department said more sanctions were being considered unless Moscow tells its allies in Ukraine back down, with even the Russian president now a possible target.

In a show of US support Vice-President Joe Biden has arrived in Kyiv where he’s expected to announce new technical support to the Ukrainian interim government to implement energy and economic reforms.

However Russia’s Foreign Minister Sergey Lavrov, has called for the US to restrain what he called the Kyiv 'hotheads'.

'The Geneva agreement is not only not being implemented, but also steps are being taken – primarily by those who have seized power in Kyiv – that are crude violations of the agreements reached in Geneva. The authorities aren’t doing anything, they haven’t lifted a finger to eliminate the causes that are the basis for the deep crisis today in Ukraine.'

As the diplomatic exchanges continue, members of the OSCE – a European security body – has deployed mediators in Ukraine to explain the Geneva accord.

Subsidies for oil, gas and coal must be curbed

Germany's development agency GIZ, the UN's Environment Program and the International Monetary Fund worked together to organize the talks. GIZ expert Dr. Detlev Schreiber spoke with DW about why they are working to reform subsidies for the fossil fuel industry.

DW: Dr. Schreiber, how do fossil fuels subsidies work?

Detlev Schreiber: Many countries are pouring money into subsidizing energy prices. In some cases, this means they are not charging the actual market price for energy. Oil-rich countries like Venezuela and Saudi Arabia have ridiculous fuel prices as low as a few cents per liter.

Now, this has a long, complicated history which differs from country to country. As far back at the late 18thcentury, the United States used tax revenue to subsidize coal. Why have governments around the world been willing to subsidize gas, coal and oil?

Some do it to help national industries be more competitive, while others want to give their citizens advantages in order to secure reelection.

What kinds of differences are there in the way rich and poor nations subsidize fossil fuels?

Nowadays, most rich countries - especially European countries - have stopped subsidizing fossil energy. Some EU nations are also selling fuel above market price. But indirect subsidies are not calculated in here. In Germany, there has been an ongoing discussion about the disposal of nuclear waste, for example. We do not include the price of disposal of nuclear waste in the energy price. The same is true when we speak of global warming effects caused by burning fossil fuel.

Many developing nations are still providing heavy direct subsidies. Most of the world's oil-rich nations are subsidizing fossil fuels - though some countries like Mexico are already tackling this problem. Astonishingly, countries like Egypt, which don't have many fossil fuel resources, are subsidizing this energy. It's tough to get rid of because there is a tradition in place. So transporters, taxi drivers and the industry think they are dependent on those subsidies.

So you are defining these subsidies not just as the funds invested in direct price reduction, but also the money paid to deal with waste and environmental damage.

Yes, this is part of subsidizing fossil fuels. In total, an estimated 500 to 600 billion US dollars are being spent to subsidize fossil fuels each year. Imagine if all that money was used for green economy transition programs, for social welfare programs, for education. Many governments could use this money in a more effective way.

Countries like Ghana have started eliminating their fossil fuel subsidies because of budget deficits. They simply cannot afford to pay so much into subsidies anymore.

What are delegates at the talks in Nairobi telling you about the challenges they are facing at home as they attempt to curb subsidies?

In some places, fuel prices, bread prices, prices for basics like milk and flour, even transportation, are fixed by the government. These are not market prices. The population attributes responsibility for the price to the government. If the government says we have to raise prices because we are paying more for fuel, many groups think that's bad. Taxi drivers, transport companies, unions, bus drivers and political parties organize protests.

Look at Indonesia or Tunisia, where - some decades ago - prices increased, triggering protests and the governments were suddenly in trouble. This shows it's important to establish good communication about these changes and also fund compensation.

In Iran, Ghana and Vietnam they've answered this challenge by providing direct cash transfers to poor households. This can smooth the transition, while slowly lifting fuel prices to market level.

This movement must be unsettling for industry leaders as you push for a rollback in the funding they receive. How much influence do oil, gas and coal companies have when governments decide to support the shift away from subsidies?

In many countries, industry is opposed. This must be taken seriously. Industry has one argument on their side: we will lose competitiveness, we have to close down, we are dependent on oil prices.

The fossil fuel industry argues that their energy products are keeping the lights on. They say oil, coal and gas are necessary for energy security - and are the most reliable sources of energy we have. How do you respond to that?

Okay, fossil fuels were the backbone of industrialization, but in many countries, they are diminishing in importance rapidly. Not only in Germany, which wants to say goodbye to nuclear energy and fossil fuels, but also places like Uruguay, which doesn't have its own fossil fuels. They are saying, 'We need independence and we have to reduce our fossil fuel bill.'

Look at Costa Rica. They have to pay about two billion US dollars every year to import fossil fuel. But they have many sources of renewable energy. Most of their electricity is already generated by hydropower. They have geothermal resources, solar resources. There is so much potential.

How do subsidies for fossil fuels affect the development of renewable energy?

Fossil fuel subsidies have a very strong effect on the competitiveness of renewable energy. In countries with heavy subsidies for fossil fuels, renewable projects are just niche projects. In countries that do not have fossil fuel subsidies, renewables do very well. According to the International Energy Agency, the elimination of fossil fuel subsidies will be the single most effective measure for climate change mitigation and would be one of the most effective measures for keeping the temperature rise beneath two degrees, which has been agreed upon in the international climate negotiations.

Dr. Detlev Schreiber is with Germany's development agency GIZ. Working with the United Nations Environment Program and the International Monetary Fund, GIZ has launched a series of talks on reforming fossil fuel subsidies.

Testing times for transatlantic ties

German-American relations have seen better days. While there was a disturbing amount of empathy and understanding for Russia's President Vladimir Putin illegally annexing Crimea among German journalists, politicians and intellectuals, these same people are highly suspicious of everything the US does these days.

Chancellor Angela Merkel's visit to Washington, DC is widely seen as delicate because it is her first personal meeting with President Barack Obama since Cell-Phonegate. Last fall, just weeks after President Obama's trip to Berlin, which conjured up the deep German-American friendship at the Brandenburg Gate, German-American relations hit another low point, when it became known that the NSA had been spying on the German chancellor, who is widely admired in the United States because of her sturdy embrace of individual freedom, home-grown in the GDR during the communist dictatorship, and her supposed ability to run the economy.

It is not only a question of cell phones, however. The current state of German-American relations suffers from a whole set of unsolved problems. There is Edward Snowden and the very different perceptions of him and his deeds in Germany and the United States. There is the German wish for a No-Spy-Agreement, which Washington is unwilling to grant. There is the American drone warfare conducted from German soil. There are the controversies around the Transatlantic Trade and Investment Partnership (TTIP), and, of course, Guantanamo continues to be a thorn in the German-American flesh.

History of estrangement

The transatlantic differences become even more visible because all actors involved are continuously stressing the stability of the German-American friendship. While there is no need for alarm as both countries continue to be so deeply entangled with each other politically, economically and culturally that mutual interests will prevent them from ever breaking up completely, there is no denying that the United States and Germany have become estranged from each other. This estrangement did not start with Edward Snowden, NSA, and the federal cell phone.

Ironically enough, it began with the fall of the Berlin Wall and the collapse of the Soviet Union in 1989/91, when both partners reoriented themselves, beginning to pursue their own post-Cold War agendas and starting to move into different directions. The unified Germany first turned inward, then continental and became a motor of European integration. The US turned its back on Western Europe, got more interested in the new democracies in Eastern Europe, put greater emphasis on hemispheric relations, and directed its energies to the Asian countries more than before.

Yet, the current German-American problems do not just involve 'hard' political interests and economic issues. In the end, it is all a matter of trust - and this trust is eroding. In the debates about the NSA and Edward Snowden, about drone wars and TTIP, both sides are also negotiating whether they still can trust each other. They are debating how they see themselves, how they are being seen by the other side, and how they want to be seen by each other. On both sides, this debate is marred by clichés and age-old stereotpyes, irrational fears and myths that one would not expect in a friendship so old and mutually beneficial as the one the United States and Germany have enjoyed since 1945.

Erosion of trust

Very telling in this context is the recent public relations offenisve by the US embassy in Germany to counter European anxieties connected to TTIP. Everyone visiting the website is asked to 'pick a myth,' only to have it refuted with facts and rational argumentation provided by the US government. The TTIP-related myths you can pick range from 'TTIP is undemocratic/the process lacks transparency. Why can't people vote on it?' to 'TTIP will force Germans to accept genetically modified foods and will force Germany to abandon laws to protect the environment.'

These government-identified myths reveal a lot about how the US perceives Germany these days. At the same time, you don't start something like this, unless you have the feeling that transatlantic misunderstanding abounds, and that nothing less than mutual trust is at stake.

This erosion of trust is driven by very different historical experiences. Some of them go way back to the 18th and 19th centuries, some of them are pretty recent. Regarding the more recent experiential divides, one should not forget that German-American relations are still moving in the shadow of 9/11. The terrorist attacks on the Pentagon and the World Trade Center of September 11, 2001 opened up a deep emotional divide between the Old World and the New World that has not been closed since. The experience of being attacked on one's own soil by enemies coming from within shocked Americans to a degree hardly imaginable in Europe.

Before 2001, terrorism from an American perspective was always something that either happened to others or to Americans in other countries but never at home. Europeans, in contrast, had not only learned to live with terrorism in their midst by 2001. Prior to 1945, they had spend so much time going to war with each other and throwing bombs on each others cities that they - cyncially enough - could never fully understand, why Americans were so shocked when the planes hit the World Trade Center, regardless of all articulations of empathy.

Reacting to the Urangst

Much of America's reaction to 9/11 - the global 'War on Terror,' Guantanamo, Homeland Security, and last not least the NSA - strikes Europeans as overdrawn, while the US considers all these measures necessary to ensure their citizens' safety and to defend their way of life based on individual freedom and self-determination. In many ways the American fears that strike Europeans as paranoid are actually the fears of modern societies. Modern societies are open and pluralistic, and the fear of being destroyed by 'enemies within' is something like their Urangst. This anxiety, paranoid or not, created the broadly shared consensus among Americans about the legitimacy and necessity of the drastic security legislation passed in the aftermath of 9/11.

President Obama did not change one of the security measures initiated by the administration of George W. Bush in response to the terrorist attacks. Guantanamo continues to operate, the Department of Homeland Security is still there, and also the centralization of America's many intelligence agencies under the roof of the NSA was not changed by the Obama administration. In all, therefore, the NSA's spying on Chancellor Merkel's mobile phone is still an effect of 9/11, and the German-American controversy revolving around it results from the deep emotional gap opening up on that day.

Volker Depkat is Professor of American Studies at the University of Regensburg, Bavaria.

Eastern US lashed by unremitting rain 30 million people under threat

Rain is hammering a large part of the eastern US with forecasters predicting the wettest day of the year in many areas.

Authorities say 20 eastern states are in danger of being flooded.

The Florida Panhandle has been hit hard along with coastal Alabama.

In Pensacola over half a meter of rain fell in 48-hours spreading concern in the community::

'It was coming hard, just real hard, trying to see what was going on, it was dark and you could see the water keep on rising. You’re just praying it didn’t get all the way in the house.'

The severe weather as well as damaging property and infrastructure has claimed the lives of more than 30 people over the last week.

In Alabama the rain caused havoc: 'An insane amount of rain. It’s crazy, way more than I have ever seen in my entire life. Just, torrential downpour, flooding everywhere, roads collapsing all over the place. It was insane,' said one of those affected.

The deadly weather pattern looks set to continue until the end of the week.

The National Weather Service believes around 30 million people are under threat from the severe conditions.

Kerry: all sides must ‘pause’ to reassess Middle East peace talks

Negotiators involved in drafting an outline for an Israeli-Palestinian peace plan failed to meet their deadline this week, after working for roughly nine months with little success. It wasn't until Thursday that US Secretary of State John Kerry, who launched the initiative, commented on passing of the April 29 deadline.

'We believe the best thing to do right now is pause, take a hard look at these things and find out what is possible and what is not possible in the days ahead,' Kerry told reporters during visit to the Ethiopian capital of Addis Ababa on Thursday.

Progress during the span of the negotiations has been marked by an unwillingness on both governments' parts to accept key preconditions. Israel, for its part, has continued approving settlements for disputed territories. On the other hand, Palestinian leaders have continued to refused to recognize Israel as a Jewish state.

Surprize pact

However, it wasn't until last week that Israeli Prime Minister Benjamin Netanyahu announced the suspension of peace talks, citing a surprise political pact among Palestinian leaders which was viewed by Israel as a threat to national security.

In 2007, Hamas, which is considered a terrorist organization by the United States and Israel, seized the Gaza Strip from forces loyal to Fatah's president, Mahmoud Abbas. Since then, Fatah and the Palestine Liberation Organization (PLO) have ruled the West Bank.

Suddenly last week, Hamas and Fatah announced their intention to form a 'national consensus' government in coming weeks, ending years of political division. They are to hold national elections in six months that would make the Palestinian territories to Israel's west and east, respectively, one political entity.

In response to the unexpected agreement, the Israeli Cabinet refused to resume talks if they included Hamas, 'a terrorist organization that calls for the destruction of Israel,' a statement issued last week said.

Kerry still optimistic

On Thursday, US Secretary of State Kerry expressed optimism that talks would, in fact, resume.

'Both parties still indicate that they feel it's important to negotiate and want to find a way to negotiate,' Kerry said

Germany suspends budget support to Malawi

Germany, a development partner since Malawi's independence in 1964, announced a change in its membership status within the Common Approach to Budget Support (CABS) group: it is now only taking on an observer status in the group, which was set up by donors to provide direct monetary aid to the government of Malawi.

Asked whether this meant that Germany was actually ending its budget support, the German Ministry for Economic Cooperation and Development (BMZ) said in a written reply to DW that this step did not represent a final decision to end general budget support. Instead, the present decision was 'based on the fact that Germany's general budget support has been frozen since 2011.'

'Given the deficit in public financial management in Malawi, Germany does not see a perspective to disburse general budget support in the near future,' the ministry stated.

Other CABS group members include the African Development Bank, the UK's Department for International Development (DFID), the European Union, Norway, and the World Bank. The International Monetary Fund, the United Nations Development Program (UNDP) and Ireland have an observer status.

The CABS group has been delaying funds for Malawi's 2013/14 budget. This delay comes after reports that the government has mismanaged state resources and failed to prosecute officials accused of overseeing projects that never materialized.

The government is embroiled in a 6.1 billion kwacha ($14.5 million) corruption scandal known locally as the cashgate scandal. According to Augustine Magolowondo, Africa regional program coordinator at the Netherlands Institute for Multiparty Democracy, Germany's decision has also very likely been prompted by the scandal. 'Probably, this is actually the most decisive factor that has been considered, because it doesn't really come as a big surprise, given the developments that have evolved until this time,' he told DW.

In a press statement, Peter Woeste, the German ambassador to Malawi, said it was important for the people of Germany to know that every cent of their hard-earned taxpayers' money reached those who were really in need and brought relevant improvements to their livelihoods. 'Germany is committed to continue supporting the people of Malawi on their path to sustainable development, it is just that we are exploring alternative ways how best to achieve this goal,' the ambassador said.

On the streets of Blantyre, news of Germany withdrawing direct financial aid to the government has caused outrage among Malawians. 'How do we have better education, health facilities, good roads with this development?' Alfonso asked. 'I think government has to justify the matter, because it seems Lilongwe was aware,' he demanded. 'What this means is that there is a loss of trust in the government by Germany,' Mercy said. 'I think Germany is not happy with the looting of taxpayers' money, because even justice has not been executed.'

'We don't have to rely on donors for 50 years, and then we keep on relying on donors for the next 50 years again - that will be retrogressive,' Watipaso Mzungu, a Blantyre-based commentator on socio-economic issues said. 'I feel like the decision by Germany is good: It will teach Malawians - or Malawi's government - to start budgeting using its own materials generated locally,' he said.

'The impact Germany's pullout will have on ordinary Malawians is something that will still have to be assessed,' Augustine Magolowondo of the Netherlands Institute for Multiparty Democracy said. 'Obviously, if the resources are not going to be channeled through some alternative means, this is going to have a serious negative effect,' he told DW. 'As a matter of fact, Germany was and remains one of the most important development partners for Malawi.'

Tough challenges for a troubled friendship

Over the years, German Chancellor Angela Merkel has addressed Congress and been awarded the Presidential Medal of Freedom on her US visits. This time, however, her visit is overshadowed by crises, and she faces an ally that has become a stranger.

NSA spying and the crisis in Ukraine are exacting issues for both countries. The Ukraine issue in particular has the potential to push Germany and the US further apart, according to Nile Gardiner from the Heritage Foundation think tank: 'There's a big divide between Berlin and Washington with regard to how to treat the Russian problem.'

Germany and a number of European countries have been pursuing 'a policy of appeasement towards Russia and that's largely due to the economic dependence in terms of energy supply,' the Europe expert told DW.

Karen Donfried, the new head of the German Marshall Fund transatlantic organization, however, points out that German-US coordination has been very good so far. 'Europe has important trade and energy ties with Russia, but even so, they, too, want to put pressure on Russia,' the former top advisor on Europe to President Obama says.

Stand united

'It's very important that Putin notices this solidarity.' Donfried says.

The Ukraine crisis is at the very top of Angela Merkel's agenda in Washington. The German Chancellor is not only bound to encounter completely different assessments and expectations of Europe and Germany, but also a president who is under considerable domestic pressure to toughen his stance on Russia.

'This meeting is incredibly timely and important,' says Heather Conley of the Washington Center for Strategic and International Studies (CSIS). The two leaders are meeting 'at a time when the West's policy toward Russia has come to a dramatic end and a new policy needs to be rebuilt,' the think tank's expert on Germany says. 'Germany's role in shaping that new policy is going to be critical for its success.'

Reluctant Europeans

Recent media reports suggest the Obama administration is dissatisfied with America's European allies. Earlier this week, the Washington Post wrote that 'US officials have indicated that they were ready to issue new sanctions last week but decided to wait for the European Union in order to protect a unified front.' The New York Times quoted unnamed presidential staff as arguing 'that effectively deferring to the 28-member European Union is a recipe for inaction.'

That's also a stab at Chancellor Merkel, whom Washington regards as its most important ally in Europe and a leader in harmonizing a joint position on Russia.

'President Obama is going to come under increasing pressure to toughen his stance on Russia,' Gardiner predicts. 'The US is going to significantly enhance the sanctions against Russia, and the Germans will probably hesitate to do so for a number of reasons: The Ukraine issue has potential to push Germany and the US further apart.'

Close cooperation with Germany

Karen Donfried has a completely different view of the German-US relationship, saying it has been strong over the past years, and remains strong today. Donfried admits the NSA spy affair is a difficult chapter, but 'the Ukraine crisis, Iran and Syria show how closely we cooperate.'

Obama faces domestic pressure on Russia, while Merkel is under pressure concerning the NSA spy scandal. 'It's certainly a priority issue domestically in Germany, but it's not a priority in Washington,' Nile Gardiner of the Heritage Foundation concedes. 'I don't see the US administration making any concessions on this or bowing to various demands coming from different political parties.'

Not obliged

Concrete results are not expected from the meeting, least of all the mutual no-spy pact that Germany has been propagating. It will take time and an intensive dialogue to mend the loss of trust, says Karen Donfried.

Heather Conley hopes the Obama administration will be 'more proactive in helping to find those areas where we can address German and European concerns.' She expects the White House to announce recommendations and assessments on US data privacy this week. It will, however, only concern the US.

After Ukraine and the NSA scandal, the Transatlantic Trade and Investment Partnership (TTIP) is the third-most important issue on the agenda. The Chancellor is scheduled to hold a speech on the trade talks at the US Chamber of Commerce. According to media reports, the planned speech has annoyed officials close to the president: the chamber is a powerful conservative business lobby and a domestic opponent.

'She's going to offer a robust defense of TTIP,' Nile Gardiner says, adding there are a lot of sceptical people in Washington with regard to the agreement. 'I think she'll be trying to convince not only the American business community but also members of Congress that it's a good agreement