Headlines:

• Three tons of food stolen from grocery stores in Spain as millions struggle
• US Promises $1B in debt relief for Egypt, even more for military aid
• Iran supplying Syria with weapons
• Saudi Arabia to become an oil importer?
• Pakistan, Afghanistan, US discuss safe passage for Taliban leaders to join peace talks

Details:

Three tons of food stolen from grocery stores in Spain as millions struggle

As the economic and financial systems of the world rapidly approach the real possibility of total collapse, signs of what we can expect on a mass scale in the near future are beginning to appear throughout Europe. In Spain, a country that just a few years ago was heralded as a shining example of real estate entrepreneurship, international tourism and a rising middle class, the situation is so bad that many are unable to meet the most basic necessities for life. Social safety nets across the continent are visibly under stress and breaking down, so much so that unemployed Spaniards have begun raiding supermarkets in order to put food on the table. As recently as last month the people of Cadiz and Sevilla, which have a reported unemployment rate of 32%, joined together to loot local grocery stores of three tons of food - some of which was distributed to local food banks.

US Promises $1B in debt relief for Egypt, even more for military aid

The United States is getting ready to finalize a deal for $1 billion in debt relief for Egypt, a move that could set a new tone for Egyptian-U.S. relations. The countries' partnership has long been based more on defence and strategic interests than on economic alliances. But as Egypt charts its own way forward in the aftermath of a historic revolution, the old ways of doing things may be falling out of favour.

Negotiations over debt relief and other U.S. funding initiatives in Egypt have been dragging for months. The United States has been hesitant to fund a new Islamist-dominated government, and Egypt has been wary of the conditions that are often attached to development funding. President Barack Obama first promised assistance to Egypt in May 2011, shortly after a popular resistance movement overthrew Mubarak. Still, despite auspicious news that negotiations are near completion, nothing has yet been finalized. The U.S. deal will probably be completed in tandem with another agreement between Egypt and the International Monetary Fund. IMF director Christine Lagarde visited Cairo in August to discuss a $4.8 billion loan, and her presence there underscored the diplomatic importance of strengthening Egypt's faltering economy. Things have not improved much since Mubarak was ousted; the country still suffers from high unemployment rates and stagnant growth. Egypt owes $3.2 billion to the United States, so the debt deal will relieve about a third of that obligation, partly through forgiveness and partly through debt swaps that help channel money into important areas like infrastructure and job creation.

Though the current debt relief negotiations are plagued by complications, U.S. aid for Egypt is nothing new. In 2010, the last full year of Mubarak's presidency and the most recent year that statistics on overseas loans and grants from USAID are available, Egypt was one of the top five recipients of American economic and military assistance worldwide. If you disregard Afghanistan, Iraq and Pakistan, all of which took clear priority because they were integral to major U.S. military operations at the time, Egypt was the second most heavily U.S.-funded country on earth after Israel. In 2010, U.S. financial assistance for Egypt totalled $1.6 billion. The vast majority of those funds went for military purposes.

Iran supplying Syria with weapons

Iran is sending weapons to Syria in order to cement its fight against the Syrian uprising, the New York Times reported on Tuesday. Despite the Syrian rebels' attempts to control border-crossings, which Iran uses to send aid to the regime, the weapons are sent using an Iraqi air corridor, which United States president Barak Obama urged Iraq to shut down earlier in August. The New York Times reported statements by unnamed military officials claiming that Iran supplies the Syrian regime with both arms and training by the Iranian Quds force. US defence secretary Leon E. Panetta had touched upon that matter earlier in August, when he spoke about "an indication that they're trying to develop, or trying to train, a militia within Syria to fight on behalf of the regime." The Syrian regime is also believed to be receiving arms from Russia. The eastern ally has always been Syria's top arms supplier and has repeatedly managed, alongside China, to veto any Security Council regime implicating Al-Assad, imposing sanctions on him, or asking him to leave.

Saudi Arabia to become an oil importer?

The idea that Saudi Arabia could become an oil importer by 2030 is laughable. But that's the scenario outlined in a report this week by Citigroup analyst Heidy Rehman. Looking at the Kingdom's growth in power demand (much of which is generated by burning oil), Saudi Arabia's domestic demand is on track to suck up ever more of its oil production to the point that there's nothing left for export. That sounds hard to believe given that the Kingdom produced 9.9 million bpd last month, the most in the world, and more than 10% of global demand. But developing countries usually grow electricity demand faster than population growth, and in Saudi Arabia air conditioning is not an option. Compounding the problem, writes Rehman is that Saudi power generators only pay $5 to $15 per barrel for the oil they burn.To assuage civic unrest in the wake of the Arab Spring, Saudi King Abdullah has granted his 30 million subjects a host of new social handouts. He's not about to yank subsidized electricity or gasoline now - but eventually it will probably have to happen. It's unlikely that by the time the Saudis need to import oil that there would be enough available on global markets to meet their needs. What's more, considering that the $600 billion Saudi economy is based almost entirely on energy exports, if the Kingdom were to be able to afford to buy oil from the rest of the world it would have to sufficiently diversify to the point that it made enough other products for export that it could offset its oil import bill. This is highly unlikely for a country with no tradition of entrepreneurship, few rights for women and a reliance on indentured laborers brought in from the likes of Sri Lanka and Malaysia to do any kind of manual labor.

Pakistan, Afghanistan, US discuss safe passage for Taliban leaders to join peace talks

Pakistan, Afghanistan and the United States on Wednesday discussed how to provide Taliban leaders safe passage to join peace negotiations, a key issue to allow the talks to succeed, officials said. The U.S. and Afghan governments have urged Islamabad to push the Taliban to participate in a peace process that has had trouble getting off the ground. All three countries believe a peace deal is necessary to prevent Afghanistan from descending into civil war after most foreign forces withdraw by the end of 2014. But the process has been plagued by mistrust between the three governments and the Taliban. The discussions that took place Wednesday in the Pakistani capital, Islamabad, marked the inaugural meeting of the Safe Passage Working Group, said the Pakistani Foreign Ministry in a written statement. The three governments agreed to form the group in April, the ministry said. The group is focused on choosing which Taliban leaders should be provided safe passage, guaranteeing their security and dealing with logistics like visas, said a U.S. official, speaking on condition of anonymity because the official was not authorized to talk to reporters about the meeting. The official described the meeting as "positive." The U.S. began clandestine talks with the Taliban last year, aided by Germany and secretly held in Qatar. It is widely believed that Pakistan provided safe passage to some Taliban militants to attend those discussions.