AUSTRIAN MEDIA HIGHLIGHTS: August 8, 2007

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SUBJECT: AUSTRIAN MEDIA HIGHLIGHTS: August 8, 2007


Verzetnitsch Defends Himself


1. All media report that former Austrian Unions Association (OeGB)
boss Fritz Verzetnitsch has come under fire in connection with the
bank Bawag trial currently underway in Vienna: It has been alleged
that he made false statements earlier this year before the
parliamentary committee looking into the losses incurred by the
bank. Verzetnitsch may be facing legal proceedings should it turn
out he knew about the Bawag's disastrous currency speculations as
early as 1998, and not in 2000, as he has been claiming. The former
OeGB boss has now gone on the offensive, with his lawyer dismissing
the allegations.
The majority of Austrian media, including mass-circulation
provincial daily Salzburger Nachrichten and mass-circulation daily
Kurier, are suggesting false testimony charges against former OeGB
President Fritz Verzetnitsch are extremely likely. The Kurier quotes
a spokesperson for the Vienna Public Prosecutor's office as arguing
an indictment is "realistic," given that Verzetnitsch is suspected
to have facilitated the concealment of the bank Bawag's huge losses.
The bank Bawag trial on Tuesday meanwhile continued to focus on the
questions of which of the defendants, including former bank CEO
Helmut Elsner and investment banker Wolfgang Floettl, knew what
about the failed currency speculations and when.


Debate over Early Tax Reform Continues


2. In Austria, strong economic growth has led to a healthy increase
in federal tax revenues and produced numerous calls for tax breaks
before 2010, when they are scheduled to occur. Government revenues
were seven percent higher in the first half of this year than they
were in the first six months of 2006. The increase in revenues from
corporate taxes on company profits has been especially strong.
Finance Minister Wilhelm Molterer of the People's Party, however,
has so far been adamant in his refusal to introduce tax reforms
prior to the date agreed on in the coalition pact between the Social
Democrats and the OeVP.
All Austrian media continue to report on the current growth in tax
revenues in Austria. Liberal daily Der Standard writes that the
economic boom has resulted in a surplus of two billion Euros in tax
revenues: This has increased pressure on Finance Minister Wilhelm
Molterer to use the additional money for tax reform before 2010. The
government partners have so far dismissed such calls, however, the
daily adds. Likewise, centrist daily Die Presse reports on "record
revenues" and "record spending." The daily explains that the surplus
from tax revenues will likely be "spent immediately," as federal
expenditures have also increased this year. A reform cannot be
expected prior to the scheduled date of 2010, for which the
government is planning tax cuts of up to three billion Euros. It is
not yet clear, however, which income groups can expect to profit
from the reform measures, says the Presse.


UN to Decide On Its Role in Iraq


3. Iraq's Prime Minister Nuri al-Maliki is visiting Iran today for
talks aimed at reducing violence in Iraq. Meanwhile, the union
representing the United Nations staff in Iraq says workers should be
pulled out of the country until their security can be guaranteed.
The union claims that UN personnel cannot be properly protected by
the US-led forces in Iraq. The call comes as UN officials are
preparing to pass a draft resolution, which would give the
organization an expanded role in Iraq. The United States and Britain
had presented the draft in the face of growing calls at home for a
pullout of their troops from Iraq.
Meanwhile, in Baghdad, the crisis in the Iraqi government continues,
with additional Sunni representatives leaving the administration,
semi-official daily Wiener Zeitung says. Five Sunni politicians from
the circle around the former Iraqi head of government Iyad Allawi
have announced they would not participate in cabinet meetings for
the time being because Shiite Prime Minister Nuri al-Maliki appears
to be unwilling to meet demands presented by the Sunnis. With the
boycott of the five ministers there a no Sunni representatives left
in al-Maliki's government, the daily notes, and adds that this makes
the government's task to boost reconciliation beyond ethnic and
religious boundaries in Iraq even more difficult.


North-South Korea Summit Scheduled for August


4. Leaders of North Korea and South Korea will meet for a summit
later this month in Pyongyang -- the second such meeting between the
two countries that are still technically at war. South Korea's
national security advisor says the aim of the summit is to "connect
and develop in a positive way the progress made at the six way talks
and North-South relations." The scheduled summit is a "natural
result," which is part of that "positive development." The United
States has meanwhile welcomed the announcement.
ORF online news reports on the current "thaw" between North Korea
and South Korea: After their last summit meeting in 2000, Pyongyang
and Seoul have now taken another step toward a normalization of
relations between North Korea and South Korea, scheduling another
meeting for late August. The summit aims at further defusing the
nuclear conflict between the two states that are officially still at
war, and at launching a "phase of peace," ORF online news says.
Welcoming this development, spokesperson for the US State Department
Joanne Moore said that the US "has been welcoming and supporting the
North-South dialogue for a long time, and we hope this meeting will
help promote peace and security on the Korean Peninsula."


The Allies Have Fallen Out


5. ... headlines independent provincial daily Salzburger
Nachrichten, publishing an analysis of the US-Afghan relations. The
provincial daily suggests that the two allies have chosen different
paths on a key issue: While President Bush wants to isolate Iran,
his Afghan colleague Hamid Karzai is doing everything not to
jeopardize his country's relationship with Tehran.
US President Bush and Afghanistan's President Karzai may be close
allies, but when it comes to Iran, the two leaders are apparently
unable to agree on a joint course, the daily says. For Karzai, the
situation seems to be clear: "Iran supports Afghanistan in promoting
the peace process and in its fight against terror and drugs," the
daily quotes. Meanwhile, Karzai's key ally George Bush recently
stressed at a press conference that the US would "continue to
isolate Iran, as that country is up to no good." Only rarely will
two allied heads of state voice their different views so openly, and
only rarely is it as apparent to what extent the positions of
governments are determined by individual interests, the Salzburger
Nachrichten points out. Nonetheless, both Karzai and Bush are right,
considering that Iran, intent on safeguarding its own interests, has
for months been playing on both sides of the road in the area,
according to the Salzburger Nachrichten.
Kilner