Watchman Newsletter

In a St. Paul lab, scientists race to defeat a wheat famine 'time bomb'

Twin Cities (Link) LA Times - Karen Kaplan (June 20, 2009)

The spores arrived from Kenya on dried, infected leaves ensconced in multiple layers of envelopes.

Working inside a bio-secure greenhouse outfitted with motion detectors and surveillance cameras, government scientists at the Cereal Disease Laboratory in St. Paul suspended the fungal spores in a light mineral oil and sprayed them onto dozens of healthy wheat plants each day. After two weeks, the stalks were covered with deadly reddish blisters characteristic of the scourge known as Ug99.

Nearly all of the plants were goners.

Crop scientists fear the Ug99 fungus could wipe out more than 80 percent of worldwide wheat crops as it spreads from its home base in eastern Africa. It has jumped the Red Sea and traveled as far as Iran. Experts say it is poised to enter the breadbasket of northern India and Pakistan, and the wind inevitably will carry it to Russia, China and even North America — if it doesn't hitch a ride with people first.

"It's a time bomb," said Jim Peterson, a professor of wheat breeding and genetics at Oregon State University in Corvallis. "It moves in the air. It can move in clothing on an airplane. We know it's going to be here. It's a matter of how long it's going to take."

Although most Americans have never heard of it, Ug99 — a type of fungus called stem rust because it produces reddish-brown flakes on plant stalks — is the No. 1 threat to the world's most widely grown crop.

Global crisis pushes 100 million into hunger

Gulf News (Link) - Reuters, Bloomberg (June 20, 2009)

Rome: The global economic crisis will help push 100 million people into poverty this year through lost jobs and lower earnings, leaving one sixth of the world's population living in hunger, a UN agency said on Friday.

The UN Food and Agriculture Organisation (FAO) forecast the number of people living in hunger would reach a record high of 1.02 billion this year, exacerbated by persistently high prices for staples following the food crisis of 2006-2008.

World food prices have risen in the past four months after falling from a record in June 2008, according to FAO data. The organisation's index of 55 foods has gained for six consecutive years and surging prices of wheat, rice and corn sparked riots from Haiti to Ivory Coast last year.

Not only will the global slowdown destroy livelihoods in the developing world - where almost all of the world's hungry live - it will reduce aid spending from wealthy countries by around a quarter, just when it is most needed, the FAO warned.

"The silent hunger crisis ... poses a serious risk for world peace and security," said FAO Director General Jacques Diouf. "We urgently need to forge a broad consensus on the total and rapid eradication of hunger."

Geithner says Federal Reserve best positioned for super regulator role

Xinhua (Link) (June 19, 2009)

U.S. Treasury Secretary Timothy Geithner said on Thursday that the Federal Reserve is best suited to become a super regulator to oversee large institutions whose failure could threaten the stability of the entire system.

"The Federal Reserve is best positioned to play that role," said Geithner in testimony before the Senate Banking Committee. "It already supervises and regulates bank holding companies, including all major U.S. commercial and investment banks."

"Our plan gives a modest amount of additional authority -- and accountability -- to the Fed to carry out that mission. But it also takes some authority away," said the Treasury chief.

According to the rules unveiled by U.S. President Barack Obama Wednesday, large, interconnected firms whose failure would threaten the financial system's overall stability would face new consolidated supervision by the Federal Reserve.

The reform also will create a council of regulators with broad coordination responsibility across the financial system.

"This Council will fill gaps in the regulatory structure where they exist. It will improve coordination of policy and resolution of disputes," Geithner explained in the testimony. "And, most importantly, it will have the power to gather information from any firm or market to help identify emerging risks."

"The Council does not have the responsibility for supervising the largest, most complex and interconnected institutions. The reason is simple: that is a specialized task, which requires tremendous institutional capacity and organizational accountability," said Geithner.

"Nor would the council be an appropriate first responder in a financial emergency. You don't convene a committee to put out a fire," he added.

Jerusalem launches debate on sharing holiest site

Reuters (Link) - Ari Rabinovitch (June 18, 2009)

Espousing a dream of harmony that may stretch credibility among even the most fervent believers in dialogue among the great religions, clerics in Jerusalem launched a project on Thursday aimed at finding a way to share the city's holiest, and most fought over, site.

Even the Jewish religious scholar promoting it acknowledges it might need divine intervention before a peaceful remapping of the area where Muslims built the 7th century Dome of the Rock and al-Aqsa Mosque on the site of the biblical Jewish Temple.

"We offer this vision for a long and deep discussion, and of course want to continue with a parallel research from other religions," said Yoav Frankel, director of the project promoting a vision of "God's Holy Mountain" (www.godsholymountain.org).

Invitations to Thursday's launch conference depict a sunlit imagined future for the area Jews call Temple Mount. Happy Muslims and harp-playing Jews mingle between the Dome of the Rock and a new Temple, as Christians walk over from the nearby Sepulchre Church, traditional site of Jesus's resurrection.

The project, headed by Jewish members of the Interfaith Encounter Association (www.interfaith-encounter.org) encourages all three faiths to re-examine the complex and perhaps foster a new theological outlook, making room for all to worship there.

Wall St. Pushes Back

Investor's Business Daily (Link) (June 18, 2009)

Reform: A White House plan to re-regulate the U.S. financial industry on "a scale not seen since the reforms that followed the Great Depression" would be a disaster. Just ask the target of the new regime: Wall Street.

The White House characterization of the bill is accurate: It is the biggest change in financial regulation since the time of FDR. But that's not necessarily a good thing.

Since much of what FDR begat — Fannie Mae, the Glass-Steagall Act, the Securities and Exchange Commission and an empowered Federal Reserve, among others — is still around today. And all of these Depression-era creations have been implicated, one way or another, in our current crisis.

Yet, Democrats in Congress vow to push through a massive new regulatory scheme as fast they can. Just one day after the plan's unveiling, and showing their impatience, they dragged Treasury Secretary Tim Geithner to the Hill for quick hearings.

Clearly, a fast vote is desired, and anyone who votes against it will no doubt be portrayed as an anti-regulatory nut willing to sacrifice the U.S. economy for free-market extremism. The mainstream media, with their schoolgirl fixation on the current occupant of the White House, will pliantly parrot the slanders.

Fortunately, the financial industry isn't lying down this time. Many on Wall Street have been stunned by a plan that subjects America's free-market capitalism to the controlling whims of bureaucrats, newly appointed czars and congressional committees headed by anti-business liberals such as Rep. Barney Frank.

"We intend to take our case to Congress to explain why we believe adding new layers to a broken regulatory system is not the answer," David Hirschmann, who heads the U.S. Chamber of Commerce's Center for Capital Markets, told the Los Angeles Times.

Deal agreed on financial supervision

EU Observer (Link) - Andrew Willis (June 18, 2009)

EU leaders reached a general deal on financial supervision on Thursday night, with Britain's Gordon Brown agreeing to a European System of Financial Supervisors on condition national governments maintained control over the public purse strings, say diplomats.

Britain has lobbied strenuously in recent weeks against European Commission proposals that would give strong powers to three pan-European authorities that could force national governments to recapitalise banks against their will.

Under the deal however, the three European authorities in the areas of banking, insurance, and securities, will get binding powers to oversee and investigate cross-border firms and to mediate in disputes between national regulators.

Mr Brown also appears to have conceded on the question of who should chair a new European risk council that will monitor the overall European financial system and issue risk warnings where necessary.

Russia, China sign cooperation pact

United Press International (Link) (June 18, 2009)

China and Russia formalized their interest in forging a closer relationship Wednesday, signing a five-point statement on mutual cooperation.

The signing came during Chinese President Hu Jintao's three-day state visit to Moscow following the Shanghai Cooperation Organization summit and the meeting of representatives of Brazil, Russia, India and China in Yekaterinburg in central Russia, the Chinese news agency Xinhua reported.

Hu and Russian Prime Minister Dmitry Medvedev spent time exchanging views on major international and regional issues before reaching a broad consensus, Xinhua said.

With the two countries having worked out their border issues, the two leaders expressed their desire to maintain stability in the region. They also said the countries will work together to develop their energy industries and oppose global trade protectionism.

Update: Iraqi Christian Radio Station Now on the Air

The Joshua Fund (Link) - AP (June 1, 2009)

It’s finally on the air!

It has taken more than a year of intense prayer, and a meeting between Joshua Fund President Joel C. Rosenberg and the Hon. Nechirvan Barzani, the Prime Minister of the Kurdistan Regional Government (KRG), requesting his personal assistance. But by God’s grace, and with the kind assistance of the Prime Minister’s office, the Kurdish government of Iraq in May gave permission for a Christian radio station that The Joshua Fund has helped finance to officially begin broadcast operations. The establishment of such a station owned and operated by Iraqi followers of Jesus Christ is really an historic development in the history of Christianity in the land once called Babylonia, and we are deeply grateful for your prayerful and financial support in making this happen. Thank you so much.

The station’s headquarters and main broadcasting facility is located in the northern Kurdish region of Iraq, in the capital of Erbil, a city of some one million people, not far from the border of Iran. The station is operating on 97.1 FM in Erbil and has a translator station operating on 104.7 FM in the city of Kirkuk, a city of about 850,000. Each transmitter operates at 250 watts. That station — which can be heard throughout the Kurdish region and thus by more than two million people — is broadcasting Christian music, original and previously-produced educational programs, original and previously-produced cultural programs, Bible reading programs and radio dramas based on the Bible. All of this is in the Kurdish and Arabic languages.

Dollar drops on reserve currency doubts

Breitbart (Link) - AFP (June 17, 2009)

The dollar fell against the euro and yen on Wednesday after major emerging economies cast doubt on its long-term future as the world's main reserve currency, dealers said.

In late morning trading in London, the European single currency climbed to 1.3867 dollars from 1.3838 dollars in New York late on Tuesday.

Against the Japanese currency, the dollar slipped to 96.30 yen from 96.42 yen on Tuesday.

Leaders of the so-called BRIC nations -- Brazil, Russia, India and China -- had on Monday called for a "more diversified" currency system.

"The BRIC leaders are divided between supporting the US dollar -- as it is the only choice for now -- and advancing the march for an alternative," said Phil McHugh, who heads the corporate foreign exchange desk at currenciesdirect.com.

"The (BRIC) meeting... will affect future sentiment on the dollar," he added.

Time for 'new world order': Brazilian President

Google (Link) - AFP (June 17, 2009)

The global financial crisis has reduced the differences between nations and created the opportunity to form a new world order, Brazilian President Luiz Inacio Lula da Silva said Wednesday.

Speaking after a meeting with Kazakhstan's President Nursultan Nazarbayev in the Kazakh capital Astana, Lula called on the global community to seize on the crisis to create a fairer world for developing nations.

"I want to say that before the crisis, there were many countries which had greater significance than others, and some countries which had no significance at all," he said through a translator.

"After the crisis, everyone has become similar. We have the possibility to create a new world order and together we should improve our relations."

The Science of Sex

One News Now (Link) - Marcia Segelstein (June 16, 2009)

Thanks to medical science, we now know that smoking cigarettes is unhealthy. It can lead to diseases like emphysema and lung cancer, and increase the risks of heart disease and stroke. So we have acted swiftly on that information. In one generation, our attitude about smoking has undergone a remarkable transformation. Where smoking was once commonplace, and homes everywhere had ashtrays, even if only for visiting smokers, today it's almost shocking to see someone light up. Banned from airplanes, offices and many restaurants, smoking – and smokers – are viewed with a kind of disdain at worst, pity at best. TV shows and movies rarely show people smoking, except when they're villains. The dangers of smoking are taught to young people with almost religious zeal. Most modern parents who found evidence that their teenagers were smoking would haul them down to the nearest cancer ward for a close up look at the consequences of smoking, or at least to their doctor, who would undoubtedly back up parental warnings that smoking is dangerous to their health.

Now substitute the words "casual sex" for "smoking." Thanks to medical science, we now know that casual sex is unhealthy.

Not just because of the myriad of sexually transmitted diseases it can cause, to say nothing of the unwanted pregnancies it can create, but because of what it does to the human brain.

Two doctors, Joe McIlhaney and Freda McKissic Bush, explain what we now know about sex and the human brain in their book, Hooked: New Science on How Casual Sex Is Affecting Our Children.

Medvedev: World Needs New Reserve Currency

Fox News (Link) - AP (June 16, 2009)

Russian President Dmitry Medvedev said Tuesday the world needs new reserve currencies.

Medvedev told a regional summit that the creation of new reserve currencies in addition to the dollar is needed to stabilize global finances.

Medvedev has made the proposal before. It reflects both the Kremlin's push for greater international clout and a concern shared by other countries that soaring U.S. budget deficits could spur inflation and weaken the dollar.

Airing it at a summit meeting underlined the challenge to U.S. clout.

Medvedev spoke at a summit of the Shanghai Cooperation Organization, which includes China and four Central Asian nations.

Later Tuesday he hosts a summit of the BRIC group of leading emerging economies — Brazil, Russia, India and China.

The Kremlin's top economic adviser said Russia may put part of its currency reserves in bonds issued by Brazil, China and India.

Arkady Dvorkovich said Russia could make the move if the other three nations reciprocate. Brazil, Russia, India and China are the members of the BRIC group of leading emerging economies.

Global warming? Temps on an 8-year decline

One News Now (Link) - Pete Chagnon (June 16, 2009)

The Science & Public Policy Institute has released their monthly CO2 report for the month of May.

The monthly CO2 report is edited by Lord Christopher Monckton, who says the organization takes satellite and scientific data and presents them to the public without any alteration. He says the data collected shows a surprising trend.

"Temperatures have now been declining quite rapidly for nearly eight years," he notes. "And none of the U.N.'s models predicted that."

The report also shows that despite a decline in the average global temperature, carbon dioxide (CO2) levels continue to climb, but not as fast as the U.N. predicted.

"And it's certainly only rising at about half of what the U.N. had predicted," Monckton adds. "That alone requires us to divide all of the U.N.'s forecasts for temperature change between now and the year 2100 by two -- you have to halve them."

According to Monckton, any warming gained by higher CO2 levels will be drowned out by natural climate variation. He also notes that the sun, which has a great effect on the weather, has entered an 11-year solar minimum, which is causing a cooling effect on the planet.

Shoveling Hail In Sandals?

WCBSTV (Link) (June 16, 2009)

Hail Storm Pounds Parts Of Garden State With Several Inches; Residents Watch In Amazement As Plows Clear Streets.

Parts of New Jersey were pummeled by a massive hail storm on Monday afternoon, leaving it looking as if a June blizzard blew through with inches of dime-sized pellets piling up.

Washington Township residents were seen on their driveways breaking out the snow shovels and officials sent out bulldozers to act as snow plows to clear the streets after severe thunderstorms pounded the region. Children were seen forming hailballs.

CBS 2 HD's Christine Sloan was in Washington Township and spoke to stunned residents. This as the snow and ice piled up around them.

It was a day for snow boots and a jacket as several inches fell in what's being looked at as one freak storm.

Plowing snow, ice, whatever you want to call it on a street in Washington Township in June. It wasn't an understatement to say folks in the neighborhood were shocked.

"Never in my lifetime, never," Karen Yates said.

GM agrees Saab sale to Koenigsegg

BBC News (Link) (June 16, 2009)

General Motors has reached a tentative agreement to sell Saab to the Swedish sports car manufacturer Koenigsegg.

GM said that as part of the deal there would be $600m (£367m) of funding from the European Investment Bank (EIB), guaranteed by the Swedish government.

It is the latest part of GM's reorganisation, which is also set to see the Opel and Vauxhall brands going to Canada's Magna.

Saab filed for reorganisation under Swedish law on 20 February.

Koenigsegg produces 18 cars a year and employs 45 people, and there has been some doubt as to whether it has the expertise to run Saab, which sold 93,000 cars in 2008.

Saab employs about 3,400 people in Sweden and about 12,000 other jobs in the country are dependent on Saab and its suppliers.

But GM Europe's president Carl-Peter Forster said: "Koenigsegg Group's unique combination of innovation, entrepreneurial spirit and financial strength... made it the right choice for Saab as well as for General Motors".

Iran and Russia nip at US global dominance

Christian Science Monitor (Link) - Fred Weir (June 16, 2009)

The "age of empires has ended" and the "international capitalist order is retreating," declared a beaming Mahmoud Ahmadinejad on Tuesday, speaking in the Siberian city of Yekaterinburg before an audience that included the top leaders of Russia, China, and India.

Experts are debating why Iran's controversial president chose to address the summit of the Shanghai Cooperation Organization (SCO), a regional grouping led by Russia and China – of which Iran is only an observer – even as he still faces mass protests and sharp questions at home over his deeply disputed election victory last week.

Some argue that Mr. Ahmadinejad selected exactly the right forum in which to make his case. The six-member SCO, founded in 2001, has grown rapidly into a key political and economic alliance, which has successfully moved to oust United States military bases from member states Uzbekistan and Kyrgyzstan, and is angling for a much wider role in regional affairs.

The group comprises Russia, China, Uzbekistan, Kyrgyzstan, Tajikistan, and Kazakhstan. India, Pakistan, Iran, and Mongolia attend meetings as observers.

OPT: Council conclusions on Middle East Peace Process

Relief Web (Link) - EU 2951st EXTERNAL RELATIONS Council meeting (June 15, 2009)

The Council adopted the following conclusions:

1. The European Union remains committed to a comprehensive settlement of the Arab-Israeli conflict, on the basis of the relevant UN Security Council Resolutions, the terms of reference of the Madrid conference, including land for peace, the Roadmap, the agreements previously reached by the parties and the Arab Peace Initiative. The Council reiterates its commitment to the two-state solution with an independent, democratic, contiguous and viable Palestinian state, comprising the West Bank and Gaza, living side by side in peace and security with the State of Israel. The Council confirms its view that this constitutes a fundamental European interest. It is an indispensable and urgent step towards a more stable and peaceful Middle East.

2. The Council welcomes the US Administration's commitment to vigorously pursue a two-state solution and a comprehensive peace in the Middle East and confirms the Union's readiness to work actively with the United States and other Quartet members to achieve this goal, including through coordinated monitoring of actions by all parties to the conflict and of developments on the ground. The EU is also ready to contribute substantially to post-conflict arrangements aimed at ensuring the sustainability of peace agreements, addressing also the regional economic and security dimensions.

3. The European Union calls on the government of Israel to commit unequivocally to the two-state solution and welcomes the initial step, following the Israeli policy review, announced by Prime Minister Benjamin Netanyahu of commitment to a peace that would include a Palestinian state. It urges both parties to take immediate steps to resume peace negotiations, respecting previous agreements and understandings. To that effect, the Council also calls on both parties to implement their obligations under the Roadmap.

EU close to deal on Irish Lisbon guarantees

Financial Times (Link) - Tony Barber (June 15, 2009)

European Union leaders are close to a deal on the legal guarantees of national sovereignty that will be offered to Ireland so that it can hold a second referendum that could unblock the group’s Lisbon reform treaty, EU diplomats said on Monday.

Negotiators from the EU’s 27 countries have yet to agree on the precise wording of the guarantees on taxation, neutrality and abortion, but diplomats said there was widespread optimism that an accord would be ready in time for a EU summit on Thursday and Friday.

“We would hope to be in a position to sign off on those texts tomorrow [Tuesday] at the latest,” Micheál Martin, Ireland’s foreign minister, told Irish radio.

Irish voters rejected the Lisbon treaty last June in a referendum whose outcome forced a delay in the EU’s efforts to streamline its decision-making procedures and project its influence more effectively on the world stage.

But recent opinion polls have suggested that a clear majority of voters, mindful of how EU and eurozone membership has protected Ireland from economic disaster over the past nine months, will now support the treaty.

Cash to become extinct as chips take off

News.com.au (Link) - Anthony Keane (June 15, 2009)

Cash is accelerating down the path to extinction as new technologies threaten to mark the end of loose change within a decade.

Bank and credit union bosses say cash won't be alone, with wallets and credit cards also likely to disappear too.

They told The Advertiser's round table forum that cash and cards will be replaced by computer chips embedded in mobile phones, watches or other portable devices.

Australian Central chief executive Peter Evers believes cash will be replaced for most transactions in five-to-seven years.

"Cash will disappear as there will be other forms of carrying cash, stored value in your phone or whatever it might be. It will transfer automatically," he said.

"We're very close in countries around the world. If you go in to Hong Kong or Singapore, the low-value transactions have already disappeared. You can't go anywhere, like on public transport, without pre-purchasing a card.

Sarkozy raps globalised economy

BBC News (Link) (June 15, 2009)

French President Nicolas Sarkozy has warned of political and social unrest unless there is greater regulation of the globalised economy.

He argued that the current system of "speculation and dumping" cannot continue. "We have to overhaul everything," he said.

He called for a larger role for social institutions in financial regulation.

The president was speaking in Geneva at the invitation of the International Labour Organization (ILO).

'Obsession'

"Regulation of globalisation is the central issue," he argued.

"Either we have reason or we will have revolt. Either we have justice or we will have violence. Either we have reasonable protection or we will have protectionism.

"It is irresponsible to believe that the financial markets can continue to impose their obsession with short-term profit on the entire global economy, and on society," he added.

Earlier on Monday, the US government outlined plans that will lead to tighter regulation of the biggest financial institutions and a new framework for consumer and investor protection.

Iran embassy in Moscow says Ahmadinejad to visit Russia Tuesday

The Jerusalem Post (Link) - AP (June 15, 2009)

Iranian President Mahmoud Ahmadinejad postponed a planned Russia visit by one day but will make the trip Tuesday, the Iranian Embassy in Moscow said.

Ahmadinejad had been expected to travel to the Russian city of Yekaterinburg on Monday and meet with President Dmitry Medvedev on the sidelines of a regional summit.

The change in plans came amid street protests in Iran following Ahmadinejad's re-election in a bitterly disputed vote Friday.

Not long before his expected arrival, the embassy said Monday that Ahmadinejad would not come that day.

Earlier, the embassy reported that Ahmadinejad had put off the trip indefinitely and it was unclear whether he will come at all.

Geert Wilders: EU is not Israel's friend

The Jerusalem Post (Link) - Benjamin Weinthal (June 15, 2009)

Basking in the glow of his spectacular election showing in last week's European Union (EU) vote, Geert Wilders, the head of the Dutch Freedom Party, told The Jerusalem Post in an exclusive interview on Friday that the EU is "one-sided and always against Israel," adding that "nothing will happen" if Israel "depends on the Europeans" to stop Iran's genocidal threats against the Jewish state.

The Freedom Party campaigned on a platform for shifting more decision-making power away from Brussels, the headquarters of the European Parliament, and back to members of the 27 EU countries. The vote was on European representation within the EU Parliament in Brussels and showed that "people are not so interested in Europe."

Wilders's Freedom Party garnered 17% of the vote, finishing second after the governing Christian Democratic Alliance of Prime Minister Jan Peter Balkenende, which tallied 19.9% of the vote.

"The Netherlands is not against Europe," he said, but "we don't want a European super state."

Terming the EU vote as a "referendum on the political state" in Holland, Wilders attributed the growing support for the Freedom Party as a call for prioritizing the domestic agenda. "Money should be spent in Holland" and not "subsidizing farmers in France and Poland," said Wilders.

Asked about the EU's posture toward Israel and forcing the Islamic Republic of Iran to halt its nuclear weapons program, Wilders said the European Parliament has "always been biased against Israel." He said he regrets "that they (EU) have a foreign minister" and argued that the "European Parliament should not be involved in foreign politics."

Israel 'perplexed' as Solana meets Hezbollah

Middle East Online (Link) (June 14, 2009)

Israel was left "perplexed" by EU foreign policy chief Javier Solana's unprecedented meeting with an official from Lebanon's Hezbollah, an Israeli foreign ministry spokesman said on Sunday.

"This meeting left us perplexed, and we dare hope that Mr. Solana took advantage of the occassion to press for a disarming of Hezbollah and for the end of the arms smuggling between Syria and Hezbollah," Yigal Palmor said.

Solana held unprecedented talks with a Hezbollah official on Saturday, during a Beirut visit to reaffirm Europe's support for Lebanon after last week's polls.

He met in parliament with MP Hussein Hajj Hassan, whose movement is considered a terrorist organisation by the United States.

"Lists of terrorist groups are not the same in every country," Solana told a news conference when asked about the US blacklist of the Shiite group.

"Hezbollah is a member of the Lebanese society and it is represented in the Lebanese parliament and it will bear responsibilities," he said before leaving for Egypt at the end of a two-day visit.

Israel must seek security through peace: Solana

Google (Link) - AFP (June 14, 2009)

EU foreign policy chief Javier Solana on Sunday called on Israel to seek security through peace while warning that future talks with the European Union would depend on "Israel's behaviour."

"What's important is to work to convince Israel that its security will be better guaranteed with peace and I think that President Obama clearly explained this in his speech and when he met the Israeli prime minister is Washington," Solana told journalists in Cairo.

US President Barack Obama has been seeking to restart the stalled peace process since taking office in January, with his envoy George Mitchell having just toured the region and reaffirmed US support for a two-state solution.

"There is currently an identical approach shared by us and the new US administration concerning the Middle East's problems and the way to act to resolve these problems," Solana said following talks with Egypt's President Hosni Mubarak and Foreign Minister Ahmed Abul Gheit.

Political dialogue between the EU and Israel would continue, Solana added, "but it depends on Israel's behaviour."

Solana has previously hailed a speech by Obama in Cairo on June 4 as opening a "new page" in relations with the Arab-Muslim world and resolving the Middle East conflict.

Israeli Prime Minister Benjamin Netanyahu is to unveil his Mideast peace policy on Sunday, but observers do not expect him to bow to US pressure and back a Palestinian state, the cornerstone of international efforts to end the decades-old conflict.

Full text of Netanyahu's foreign policy speech at Bar Ilan

Haaretz (Link) - Benjamin Netanyahu (June 14, 2009) Watch full speech at bottom of post

Honored guests, citizens of Israel.

Peace was always the desire of our people. Our prophets had a vision of peace, we greet each other with peace, our prayers end with the word peace. This evening we are in the center named for two leaders who were groundbreakers for peace -Menachem Begin and Anwar Sadat - and we share their vision.

Two and a half months ago, I was sworn in at the Knesset as the Prime Minister of Israel. I promised that I would establish a unity government, and did so. I believed, and still believe, that we need unity now more than ever before.

We are currently facing three tremendous challenges: The Iranian threat, the financial crisis, and the promotion of peace.

The Iranian threat still is before us in full force, as it became quite clear yesterday. The greatest danger to Israel, to the Middle East, and to all of humanity, is the encounter between extremist Islam and nuclear weapons. I discussed this with President Obama on my visit to Washington, and will be discussing it next week on my visit with European leaders. I have been working tirelessly for many years to form an international front against Iran arming itself with nuclear armaments.

With the world financial crisis, we acted immediately to bring about stability to the Israeli economy. We passed a two-year budget in the government and will pass it through the Knesset very soon.

The second challenge, rather, the third, so very important challenge, facing us today, is promoting peace. I discussed this also with President Obama. I strongly support the idea of regional peace that he is advancing. I share the President of the U.S.A's desire to bring about a new era of reconciliation in our region.