July 25 (Reuters) – An African Union (AU) summit in Uganda just two weeks after bombs planted by Somali rebels killed 76 people in its capital will for the next three days tackle the crisis in Somalia. [ID:nLDE66O07Q]
But what is the African Union and what can it do?
* The AU emerged from an earlier continental body called the Organisation of African Unity (OAU), which was set up in 1963 with a charter signed by 32 countries in Addis Ababa. The OAU was considered a bit of an “old dictators’ club” by many in Africa and was criticised for not acting against coup plotters.
* The AU replaced the OAU in 2002 with 51 members and said it would work for closer political integration among African countries. It has set about distancing itself from the OAU by often suspending coup leaders. It now has 53 member states.
* The AU was developed along the lines of the European Union and has 10 commissioners overseeing departments. They include political affairs, agriculture and peace and security. Its founding charter mandates it to work for “democracy, human rights and development”. It also promotes investment in the continent and sends peacekeepers to troublespots.
* Its first military intervention in a member state was the May 2003 deployment to Burundi of peacekeepers from South Africa, Ethiopia and Mozambique. When that mission ended, Burundi became a contributor to AU peacekeeping forces, saying it was grateful for the help.
* The AU also sent peacekeepers into Sudan’s Darfur region in 2004 and, at its height, that force was 7,000 strong. It was replaced by a U.N. force in 2007.
* The AU currently has some 6,300 Ugandan and Burundian troops in Somalia’s capital Mogadishu, keeping that country’s besieged government in power.
* Analysts are divided on how effective the organisation is. It often has trouble mustering troops for its peacekeeping missions. It is also underfunded, with many of its desperately poor members never paying their annual dues.
* But analysts say it has grown teeth in recent years, suspending countries that have suffered coups, imposing sanctions, sending envoys to mediate between governments and rebels and genuinely promoting investment.
* The countries that kick in the most money often try to dominate affairs. This is demonstrated by the fact that the personal mission of Libya’s Muammar Gaddafi — “The United States of Africa” — has been talked about at AU summits for years, despite many delegates thinking it a laughable prospect. (Editing by David Clarke)
Ireland to auction bonds after Moody’s downgrade
July 20 (Reuters) – Ireland is due to auction bonds worth up to 1.5 billion euros on Tuesday, a day after Moody’s cut its credit rating citing mounting bank rescue costs and weak growth prospects.
Moody’s, which dropped the rating by one notch to Aa2, also changed its outlook to stable from negative, which helped make much of the hit to Irish bond markets on Monday short-lived.
Analysts expect the National Treasury Management Agency (NTMA) to meet its target to sell between 1 billion and 1.5 billion euros of 6- and 10-year bonds on Tuesday.
The NTMA almost invariably hits the top of its target size range but borrowing costs could rise compared with similar auctions in May and June as fresh bad news has emerged since then concerning Ireland’s ability to cut its budget deficit.
The cost of bailing out nationalised Anglo Irish Bank [ANGIB.UL] last year gave Ireland a budget deficit of 14 percent of gross domestic product, the highest in Europe, and this could rise to 20 percent this year, the state-funded Economic and Social Research Institute (ESRI) said last week [ID:nLDE66C0WA].
And while the Irish public has so far grudgingly accepted fiscal tightening, a senior official in Prime Minister Brian Cowen’s governing coalition said on Sunday voters might not be ready to accept all the further cuts on the way. [ID:nLDE66H07R]
The International Monetary Fund has also questioned Ireland’s ability to meet an EU deadline to get the deficit down to 3 percent of GDP by 2014. [ID:nLDE66D0F6]
Ministers have stood by the 2014 target and Cowen on Monday reacted to the Moody’s downgrade by saying domestic commentators had painted too negative a picture of the Irish economy.
He referred to praise from investors for his determination to cut spending, which has helped differentiate Ireland from other struggling euro zone member states.
“The message from outside this country is that Ireland is seen to be proactively confronting the challenges that it faces,” Cowen said. “There is a lot of support for what Ireland has been seeking to achieve.”
Ireland does not face any major bond redemptions this year and NTMA Chief Executive John Corrigan said on Friday it had raised enough funds to see Ireland through to the first quarter of 2011 regardless of the outcome of upcoming monthly auctions.
Having raised more than 80 percent of its planned 20 billion euro of borrowings this year, Corrigan said he aimed to have the 5 billion euro in debt maturing next year already funded going into 2011. [ID:nLDE66F0LP]
However, Corrigan also said that the spread of Irish bonds over German Bunds was disappointingly high.
Tuesday’s auction results are due around 0900 GMT.
(For scenarios on hurdles for the Irish fiscal drive please click [ID:nLDE66I10Z]) (Editing by Tomasz Janowski)