ITALY

ITALY
Corriere della Sera, Milan, May 28: It has been noted that the peace negotiations in the Middle East depend on two men and the power to influence. The two men are the prime minister of Israel and the representative of the Palestinians, each charged with expressing the aggression and conciliation of their respective societies. The power to influence is that of the president of the United States, who embodies the only foreign power able to alter the equilibrium between the two parties.
With the political decline of Yasser Arafat, the job of stopping the suicide bombings has been left to newly-appointed Palestinian Prime Minister, Abu Mazen (Abbas). For now, he can say he does not have the means to carry out his orders and that the peace process will become hypocritical if the Palestinian government does not receive help. But ultimately, the prime minister must prove himself capable of stopping the attacks. That will be his moment of truth.
Binding conditions
Ariel Sharon has become a man of surprises, or perhaps of enigmas. Fundamentally, he is obligated to approve the road map, even if he attaches 14 binding conditions (the first of which calls for the end of Palestinian attacks). But the fact is, if Abu Mazen does his part, it will be difficult for Sharon not to do his.
George Bush has been accused of disinterest for quite some time, but the Iraqi enterprise and next week's Summits on the Middle East have changed everything. Now, Bush no longer criticizes Clinton's attempts and seems willing to follow the path of his father who imposed 1991's Madrid conference on the two parties. But will George Bush have the political courage to use the full weight of his influence despite the discord within his administration and the pressure of an upcoming election year? If so, he will earn the respect and full support of Europe.
SWEDEN
Dagens Nyheter, Stockholm, May 27: What's worrying Washington is the information that Al-Qaida members in Iran took part in the recent bombing attacks in Riyadh, Saudi Arabia, as well as suspicions that Teheran is developing nuclear weapons.
Because of this, the world may be confronted with the same dilemma as it was during the war in Iraq.
Nonproliferation treaty
There is a broad unity in the world that no country should be able to shelter terrorists and that the nonproliferation treaty should be respected. The disunity is about the method.
And if the American conclusion will be that something similar will work in Iran, then the world order as we know it is in a bad fix.
BRITAIN
The Guardian, London, May 27: The closure of financial markets in the U.S. and U.K. brought momentary calm to the main foreign exchange markets yesterday but no one will be surprised if turmoil is renewed later this week.
Europe has entered serious economic turbulence without an agreed road map to get out. The long-predicted decline of the dollar has given the euro the strength its architects hoped for -- but at the worst possible moment.
Germany, Europe's biggest economy, is facing the self-reinforcing threats of recession and possible deflation. Most of the other eurozone economies are not doing much better (though France grew by 0.3 percent in the first quarter). In these circumstances they need a sharply increasing currency like a hole in the head. The erupting euro will make exports more difficult and imports easier, thereby exacerbating the threat of recession.
Deficiency of demand
What can Europe do? The rising euro has aggravated Europe's real economic problem -- deficiency of demand. That should be dealt with by putting more money into people's pockets and industry's coffers by cutting interest rates and easing fiscal policy. But the eurozone's masochistic fiscal rules will not permit deficits above 3 percent of GDP even when unemployment is over 10 percent.
Germany is supposed to raise taxes or cut public spending -- the reverse of what it should be doing to prevent its economy from going into free fall.
Germany now -- and maybe the rest of Europe later -- is facing an actual fall in prices. Not "benign" deflation when technology forces down the price of computers but malign deflation when falling prices prompt consumers to postpone purchases of ordinary goods (knowing they will be cheaper later) and companies to cut investment and employment to stave off falling sales and profits.