VENICE, Italy – Ministers from seven EU countries called on Tuesday for sharply higher state aid for fishermen hit by soaring fuel prices that are stoking inflation and protests across the globe.
Britain announced figures for May showing inflation at its highest in 11 years, a day after a meeting of European and Asian finance ministers heard warnings of the gravest inflation crisis since the oil shock of the 1970s.
South Korea said strikes by truckers and a major umbrella labor group over pay and prices were illegal and vowed to crack down on strikers unless they return to work. Troubles in Asia, where governments have struggled with fuel subsidies, have been reflected in strikes and protests across much of Europe.
In Venice, Italian Agriculture Minister Luca Zaia said Italy wanted to boost aid to fishermen to 100,000 euros ($155,100) a head over three years. The current level is 30,000 euros over three years.
The proposals from ministers from France, Spain, Slovenia, Italy, Greece, Portugal and Malta are part of a package of measures to help fishermen which will be sent to a full meeting of EU agriculture ministers next week.
Protests by truckers, fishermen and other groups particularly vulnerable to rising energy costs have swept across countries from Spain to India and South Korea in recent weeks. Analysts fear any raising of interest rates to choke back prices could further slow world economic growth.
A government source said on Tuesday Taiwan planned to raise power prices by 25.2 percent on average by the end of the year to reduce subsidies and bring them more in line with the market following a two-year freeze.
Analysts said any increase would add to inflationary pressures, as elsewhere in Asia, and that would probably prompt the central bank to let the currency firm and raise interest rates further. The cabinet would have to approve any increase.
IRAN ACCUSES WEST
A meeting of finance ministers on the South Korean resort island of Jeju on Monday highlighted the global nature of the inflation surge.
“It's no overstatement to say that the world is faced with the gravest crisis since the oil shock of the 1970s, with oil, food and raw materials prices skyrocketing,” South Korean President Lee Myung-bak said.
Inflation is fuelled by food and energy costs, which are surging on steadily rising demand from fast-growing economies like China and India and some supply disruptions.
Iranian President Mahmoud Ahmadinejad saw fuel inflation as the result of political manipulation by Western powers.
“At a time when the growth of consumption is lower than the growth of production and the market is full of oil, prices are rising and this trend is completely fake and imposed,” he said.
“It is very clear that visible and invisible hands are controlling prices in a fake way with political and economic aims,” he said, opening a meeting of the OPEC Fund for International Development in the central Iranian city of Isfahan.
Oil eased to stand near $134 on Tuesday after touching a record high near $140 the previous day, with the market looking ahead to a meeting of oil producers and consumers in the Saudi city of Jeddah at the weekend.
(Writing by Ralph Boulton; editing by Keith Weir)
($1-.6447 Euro)
