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Lisboa, Portugal
Nasci no dia 11 de Junho de 1964 na cidade da Beira, MOÇAMBIQUE.

A Estação dos CFM, Beira

A Estação dos CFM, Beira
Ex-libris da cidade, 1966

The Euro, as a single currency, should be abolished

Another black and white motion statement leaving me no option but to choose No.
While I agree to the first part I am not prepared to contemplate the idea that the Euro should get abolished.
Abolished? Then what?
All 17 countries now sharing the single currency would revert back to their old monies?
Or a new version of yesteryear's currencies?

Simplistic as I made it out to be packed in a few odd questions, every single serious economic, financial and social consequence is inextricably wrapped up within each.
That is where the stakes are high enough to ensure that the Euro is given a new lease on life.
It calls for closer European integration.
What form and shape this will take is for policymakers and far-sighted politicians to grasp and propose.

It would seem to me that the Euro has many underlying strengths but will not - contrary to the founder's beliefs - assure convergence between all the economies it services. How could it?
The divide has been felt acutely lately (1-2 years) the logical consequence of relevant economic under-performance among member-countries.

There has obviously got to be a political solution rooted in realistic economic fundamentals.
The road traveled so far proved artificially smooth during the first 10 years I dare say but unsurprisingly very bumpy in the last 1-2.
It could not have been otherwise given the structural differences setting these countries apart. And excessive spending pursued mostly by a few Southern European States who could not see beyond the present.
Adherence to the Maastricht criteria never again seemed to be taken seriously once countries landed themselves inside the Euro club. Not to mention Greece that never fulfilled the criteria in the first place or ever bothered to balance its books.

Very disappointing to admit but the Euro Zone is indeed right in the middle of a storm testing its main crews to the limit.
The latest summit decisions seem to indicate that where there is a will there is a way.
It may have just been one first small step in the right direction.

The specifics are very hard to work on.
Yet it would seem to me that the 17-member Euro Zone and the larger EU can hardly afford shooting down the Euro.
The broader picture needs to come into full view.
An hypothetical demise of the single currency would deal another severe blow to Europe's economic fortunes.
Its relative decline vis-a-vis the rest of the world would get a further boost.

I do not like misplaced calls for solidarity from Southerners but would rather see the stronger half of the dividing line realize where their medium-to-long interest lies.
To that end many balances across the Euro Zone need to be restored at the earliest.

Europe agrees a "shock and awe" bailout for Greece

A rescue package of epic proportions, epic challenges for the Greek government and people, epic uncertainties and epic stakes for the single-currency.

It was the Euro's defence that ultimately forced politicians from Germany to Malta to perform a hard balancing act whose overall success is far from assured.Each finance minister has enough reasons to fret and grumble about.It being the Euro as a common currency, because of Greece despite Greece.
Up to now every 'least damaging' approach failed miserably to cool down the financial markets that remained as unimpressed as ever throughout.
For its part Greece is effectively the main winner in this high-finance gamble.The country bought time the markets were not willing to give it once confidence vanished.Precious time desperately needed to restore credibility and good governance at home.
A daunting internal fix with daunting external implications.
Three full years is what the government and Greek society top-down and bottom-up now have to set the record straight in so many ways.
Literally and figuratively.

For the other 15 Eurozone countries - each facing own troubles to varying degrees - keeping fingers crossed would be mild to describe the monitoring of Greece's performance over the coming 36 months.Potentially they are all losers, starting out by losing simply to avoid bigger losses!
There are so many relevant questions that might be asked to which full answers ought to be provided.
They won't get asked or get answered.
Tellingly, each and every single one of them would now seem rhetorical or at best an exercise for academia.

The spectre that haunts Europe

I am still hopeful that Greece will not require a bail-out in whatever form pinning my hopes on the PM's own words.

He did sound very bold and brave in the face of such overwhelming odds but until a deal is actually in place I would rather believe the Greeks can and will take care of themselves.

My stance is wholly based not on immediate needs triggered by the Western financial meltdown that led to the economic downturn.This in turn led to a collapse in tax revenues across countries caused by economies shrinking badly.

To a large extent Greece is indeed a one-off case-study for the worst reasons, its latest fiscal deficit the sum total of profligate spending, widespread cultural-rooted tax evasion, underbudgeting, creative accounting, weak notion of public service and duty, etc - all conspiring over decades to bring the country to the brink of bankruptcy.

I am sure many Greeks will have seen it coming and warned their governments in years past.To no avail as even the present government was elected as recently as late 2009 on a platform to increase spending.

According to EMU rules public finances were clearly to remain national responsibilities.A considerable chunk of sovereignty for States to manage through their democratically-elected governments of the day.
Would the Greeks have liked their Finance Ministry to be ruled or dictated to from Brussels or Frankfurt just so the Maastricht-agreed criteria could not have been so despondently ignored?

Current turmoil is the Euro's hardest test ever but one that will also represent a defining moment in the single-currency's future.

It is a fact that Southern European countries are faced with similar issues though not on the same scale and urgency.Others in Northern Europe, the US and Japan also recorded their biggest fiscal deficits and added up noticeably to their debts in 2009.
Each one has its own track-record, however.
This is exactly what sets Greece apart from the rest.
Each country is unique in its own way, there being obviously overlapping between them.

International rating agencies must make the effort to closely monitor and register those differences and then advise financial markets.

After all it is sovereign countries and sovereign debt one is dealing with.

There is much more at stake than strictly soulless bundling of nations.

Arquivo do blogue

quinta-feira, 27 de dezembro de 2012

TEc - Chinese growth - Upward bound

China's economy is now comfortably in the second spot behind the USA.
It must be reminded that its origins are very modest to, over three decades of relentless crescendo, overtake every single G7 but the US.
For the time being, that is.

A remarkable feat that has impacted the world in no small measure.
One consequence of an already huge economy is that it is ever harder to achieve high growth-rates.
As such anything above 5-7% is robust by most reckonings.
China's potential is far from exhausted yet its ratcheting up has been so real, consistent and quick that the economy could overheat at any time in the years ahead.
Or the leadership succeeds in keeping the economy running cool at manageable rates thus avoiding bubbles in the making.
Time will tell but Chinese leadership has demonstrated remarkable control dealing with economic issues.
From results delivered that may only be considered stellar.

segunda-feira, 24 de dezembro de 2012

TEc - Halfway to paradise - The allure of Mumbai

A must-read to all who care for Mumbai/Bombay.
As ever the city that never sleeps remains full of promise and challenge.
For all its renowned enduring energy Mumbai struggles on daily to cope with requirements that have long surpassed the ability of multiple systems to deliver.

But hope never fades away in such an environment. It is embedded in the genetic code of hustling and bustling metropolises not to give up regardless of how overwhelming the odds may be.
If the sleek design of this 8-laned bridge-over-the-water-viaduct is anything to go by the future should see many more modern infrastructure projects brought into service: sections of urban highway, the metro line, monorail line, new airport terminal, etc.
Much of it will fall far short of pent-up demand or needs that have built up over many decades.
Nonetheless, a bold start has been made;
Sea-Link underpinning it much more than merely symbolically.

sábado, 15 de dezembro de 2012

TEc - Broken hearted - On yet another mass shooting in the US

It is too late for the children whose lives were cut down early enough for them to begin to comprehend the ways of the adult world.
Just so for every other who survived the latest outrage. These will have a memory to live with.
The latest outrage indeed, on top of every other. There have been countless many before that grown-ups should feel ashamed of themselves for their objective inaction.
Not equally ashamed as only a few bear far more responsibility than the rest of us.

In America regardless of constitutional rights, cultural tradition, individual freedoms (to buy guns) dating back to the country's foundation, the time is Yesterday for a majority resolve on this particular issue.
To my mind there is a clear mix-up between the individual and the collective.
The rights of individuals and potential consequences to a group of individuals who each, theoretically, has the right to hold a gun in self-defence.
If only one of the children at that school had a gun - grabbed from a parent - and were at the right place at the right time, or a teacher, or a staff member and the outcome might have been different.
That's exactly the crux of the matter.

Should each American possess a gun - man, woman or (child) - such outrages could be prevented!!!!
Could they? Would self-appointed killers who premeditated their act take a hit before opening fire on others?

Ridiculous that I should even be writing on the subject.
Gun-control ultimately leading to the lawful ban of gun sales to civilians is a matter of utmost urgency for the lasting well-being of American society.
Statistics say so. Comparative analysis with other societies prove it. Mainly, the depths of our own-selves should be able to reason it out without an opinion being forced on us by whoever.

Lastly, this is random terrorism on the loose. The worst type.
No one is safe in a society where there are reportedly 300m guns in the hands of ordinary citizens.
It only takes being at the wrong place at the wrong time.
No type of terrorism - acts of sheer terror aimed at innocent civilians - is ever acceptable.
This is how American society should start viewing these episodes as.

sexta-feira, 14 de dezembro de 2012

TEc - The London effect - About the change to Britain's population mix

The colouring of Britain would be a suitable title to the article.
From a London that sets the example for the rest of the country to follow.
Volumes of new settlers and offsprings are now sizeable which makes it a welcome development that there's a better spread across the land thus alleviating excessive concentrations.

But a legitimate question must be asked as to what Britain will look like 10, 20 years ahead going by the past decade now tallied up.
At the end of the day the real issue is about numbers and volumes.
It is not indifferent to have minorities of 5%, 10%, 15%, 20%, 25%, 30%, 35% or more as a percentage of total indigenous population.

30 years ago Mrs. Thatcher publicly aired her concerns over entire communities being swamped by immigrants in the heartland of English cities. She was attacked by many but her point had to be made.
It has already happened and none should feel hesitant to openly discuss it.

For Boris Johnson London's ethnic diversity represents a competitive edge on top of every other plus. A cosmopolitan city drawing talent from all over.
Fair enough if this is the future of an increasingly intermingled borderless world.
Will he still hold the same view say if 10-20 years down the line - assuming current trends stick - there is a complete upset of London's population make-up?
If, for instance, today's white majority (as a single group) becomes tomorrow's minority?

There are of course social, economic, cultural, physical and political implications to such a reversal that British society should be able to deal with right now.
No one should get explicitly or implicitly accused of racist undertones simply for stating an objective point.
A point on the consequences of mass movement and (re)settlement of people. One that might eventually lead to the complete change in the human landscape of a major city such as LONDON.

sábado, 8 de dezembro de 2012

TEc - Life and death struggle - Battling corruption in China

This will be an entirely Chinese call to heed and deliver.

For many high-ranking, middle-ranking, low-ranking officials appointed to any matching job awarded by the party the spoils have been/are plentifully enticing in a surging economy as China's.

"Make hay while the sun shines" is an old saying that resonates everywhere especially where the emergence of wealth - real or perceived - is quick and large-scale.
Despite well publicized trials meant to deter would-be prevaricators, it is not clear who ends up facing the bar in China.
Those who fall out of favour with the more powerful within the party or those who have indeed fouled up no matter who or what their rank?

Corruption in China is generally portrayed as a high-level gamble.
If one is pushed out because he/she is no longer politically trusted by the leadership then high-level corruption will only thrive with renewed vigour every time.
In such a scenario it isn't being addressed at all.

I am in no doubt that China's top leaders are genuinely concerned.
They'd better be!
They wish to be seen to be ridding the party of corrupt and corruptible individuals.
This is an ongoing hard task of permanent vigilance and endeavour fostering a culture efficiently disapproving of corrupt practices.

China, mainly the Chinese people, stand to gain immensely if corruption is severely frowned upon for the right reasons to eventually become a low-intensity side show...

sexta-feira, 7 de dezembro de 2012

TEc - Goodbye Europe - Britain loudly discusses own exit from the EU

'The Economist' has chosen the appropriate word to define a hypothetical British exit from the EU: gamble!
Before it stands reckless...
The two together sum up brilliantly what might become of the UK as a stand-alone major European country proudly posturing on the fringes.
It is true the British have not quite reconciled themselves with the demise of Empire. Or perhaps more accurately they haven't yet carved out a new role for them in Europe and the world.
Such adjustments do indeed take decades but time is now running out for Britain's Establishment to clearly decide on the EU and carry along the better part of the nation.
Given the UK's track-record in Europe since 1973, its many hesitations mainly, the outright rejections euphemistically called opt-outs are relevant enough to warrant a final IN or OUT commitment.
And what it takes to bear one or the other.
Unless the EU is on its death throes - which I would want to believe it is not despite current troubles/divisions undermining it - I fail to see how a lone UK might, on balance, fare better.
The issue is far wider than mere conjecture or partial evaluation.
It is an across-the-board assessment of financial, economic, cultural, societal, military, geographical, logistical and political implications.
In a globalized world where countries have over the years joined to scale up trading and political blocs - to sort out their differences and measure up to the majors of the day - for the UK to increasingly wish to breakaway from one is anathema to no-nonsense moderate thinking.
The debate that has always simmered in the back burner of British life now seems to have reached boiling point.
Dithering won't help when clarity is required.
The UK must be part of the solution to the EU's multiple problems and challenges.
Not a permanent source of anxiety, sovereign demands and added concerns.
'The Economist' is a renowned British institution whose independent voice must be heard on a plethora of vital issues. This is one of them.
The point the newspaper makes here should be a powerful contribution to the nagging assertiveness and doubts of many sitting at polar opposites of opinion in the UK.

terça-feira, 20 de novembro de 2012

TEc - Moody bleus - France's rating

The second sister has just caught up with the first.
It won't be long before the third joins the two.
There and then the three will increasingly decide France's fortunes in bond markets.
Such is the logic of the system, the natural order of things, the déjà vu setting that has carried every peripheral country to its present plight. Risky debt warrants risk premiums on top of rates in an upward spiral eventually driving entire nations/economies to the wall.
The most unfortunate circumstance is governments relied on debt to finance expenditure way above basic rules of prudence.
Once rating agencies - the sisters (3 of them, all US-based) - determine what financial markets should do and both gain the upper hand, politicians and governments look hapless, dejected, thorn between a crude systemic function and their peoples.
Who wins the contest?
The system, the very system they ought to know inside out.
To the detriment of countless millions among their own citizens.
I would like to believe that France will be different for all its underlying strengths and pivotal role in the EU and Eurozone.
Its strengths should, on balance, outweigh weaknesses and rigidities.
The tug-of-war has just begun.
There are now only 4 triple As remaining in the Eurozone.

domingo, 18 de novembro de 2012

TEc - Making great strides - Bangladesh's gains

An impressive video report that does justice to what has gone right with Bangladesh. And it is not little for an overpopulated huge flood plain whose natural challenges are permanently as demanding as those posed by man.

I have been pleasantly surprised by improvements reported here not least because they were achieved despite overwhelming multiple odds the country has faced since birth in 1971.
Empowering women as agents for economic and social change seems to have been the root cause of gains made.
In a Muslim society this strikes as of great relevance.
It does show countries need to tackle their problems with ingenuity and inborn/inbred solutions.

Despite grinding poverty afflicting the vast majority, there are pointers turned firmly upwards Bangladeshis can genuinely feel proud of.

quarta-feira, 14 de novembro de 2012

TEc - Battling French decline - France steps up to the plate?

No political leader aspiring to do the things that need doing can give more than a sigh to popular ratings.
No matter how important to remain in touch with the populace, government is about running day-to-day business with a clear view to the future. To that end any responsible French President backed by responsible advisors could no longer ignore the real issues explaining France's underperformance and new challenges posed by the global economy.
France has a long tradition of enlightenment, culture, human rights, values, innovation, savoir-faire and state-of-the-art technology.
However, it cannot go unnoticed that the country has slipped in industrial competitiveness vis-a-vis next door Germany. A relative decline it has been for which adequate measures must be enacted now that will arrest and reverse the slide.
Home to such world-famous names as Mirage jets, Exocet missiles, Areva nuclear reactors, Airbus commercial aircraft, Carrefour retail chain, TGV/high speed trains (itself a brand-name), Renault-Peugeot-Citroen cars, Total oil, perfumes, champagne, etc, France must ensure it retains all of these by providing a business-friendly environment for them to prosper and invest in.
To my mind this will be Mr. Hollande's most critical test.
His administration has already given due relevance to Louis Gallois' report. It has started out in great style acknowledging the need of the hour as pin-pointed by one of the country's greatest managers.
Changes to VAT rates seem to me generally well-balanced between a desired increase in overall revenue and a cut to the reduced rate on essentials.
Many governments across the developed world face similar problems to varying extents. Most are underpinned by excessive State spending over many years now demanding adjustment in line with tax revenue.
Turning France's fortunes around will require time, reform and boldness.
First steps in the right direction appear to have been taken.
More will follow but balance must remain the keyword.
The stakes are high enough for France, the Eurozone and the wider EU.

TEc - A new Atlantic alliance - Brazil reaches out across the South Atlantic

A natural environment to work in as any number of commonalities would spring to mind between Brazil and Africa. Lusophone Africa featuring prominently for reasons that do not need telling.

Also, if Brazilians can make a real difference while competing with Chinese firms to African countries' gain then an added value may be counted up.
Brazilian companies' know-how, expertise and technology have seen them operate successfully around the world.
There being so much to be built in most parts of resource-rich, infrastructure-poor Africa to focus there is therefore a natural winner.

sexta-feira, 9 de novembro de 2012

TEc - Europa to the rescue - Europe wanders on

Europa to rescue Europe?
Mythology called in to ease reality filled with voids and uncertainty?
Whatever it is there is a growing sense that something has to change before it becomes too late to save Europe from itself. Even when it goes unsaid, unspoken or unwritten there is deep-seated apprehension, disbelief and fear in the air. And it is not good.
As it is few can see where the EU is headed for.
For it is not only about the sovereign debt crisis, fiscal imbalances, uneven wealth levels, production and consumption patterns or sluggish to no-growth to negative growth across most countries.
Latest forecasts (for all they are worth) point to recession, stagnation or meagre growth at best, in just about every EU-member State.
Isn't there an answer politics can work from?
Is there no alternative to stop the rot?
No way of tackling every problem simultaneously while promoting growth?
Sound growth that's so critical to sustain life and hope?

quarta-feira, 7 de novembro de 2012

TEc - Obama's win raises questions for Republicans - Republicans must show less dogma but BO is the man of the hour

A fine re-election win no doubt.
Barack Obama and his Administration did deservedly get the vote of confidence from most Americans across the country.
But America is a neatly divided house in established voting patterns and societal views as much as in the options of the political leadership in Washington.
The concerns of average Americans, however, are understandably largely shared.
The economy and jobs.
Throughout the 20th. century the US saw ever rising prosperity, material well-being and external projection of power.
Many do not realize the world has already changed relevantly posing new and permanent challenges. These will require some painstaking consensus-building on main issues especially among those whose economic and financial decisions bear an immediate impact on large groups of people.
In a nutshell BO can fairly be said to have rescued America from the brink. Financial and economic meltdown loomed large when he took office in 2009. His Administration has governed in the context of a rising economic, financial and industrial power that puts up additional pressures and opportunities.
His job is only half done for the structural imbalances that created huge year-on-year trade deficits and debt - government and household - are yet to be addressed in earnest.
This requires a vision for the collective future of the nation. One that will take on board the vast majority of those who make a difference in America's society whether in government or running a private company.
An economy geared to show better balance between domestic production, private consumption and exports.
Social policy too has seen relevant progress over the past 4 years. The scope for improving efficiencies in the system remains immense.
4 more years are indeed direly needed to consolidate policy choices undertaken and strengthen the economy.
The world can count on the renewed stay at the White House of a cosmopolitan man with a sharp intellect.
Politically a moderate who has displayed sound judgement in action and uplifting speeches that reach out to just about everyone.

sexta-feira, 2 de novembro de 2012

TEc - Which one? - An endorsement I concur with...

Three days ahead of the elections in the US The Economist has reluctantly picked its horse.
Going by the article's gist it does so out of a lack of a solid alternative than for the incumbent's allegedly chequered record and, importantly, unknown future promise.
But Barack Obama, to the best of my ability to assess America from the safe distance of a pond, has done enough over his 4-year term to deserve a second one.
Indeed, unless a President screws up real bad in the first term he does actually need two to deliver meaningfully on main policy choices. This is much more so given the parlous state of America's economy and financial position back in 2007/8.
The Obama Administration's achievements on many fronts of domestic and foreign policy can in no way be understated. All countries have their own built-in inertias that are hard to move/remove. In the US's case the opposition camp gathered around the GOP is particularly tough on a wide range of issues which is why American society has become so severely polarised.
However light-heartedly, that "The Economist" should renew its endorsement of the Democrat Barack Obama to the White House is itself an indictment of Mitt Romney's failure to make a convincing case but also a confirmation of the current Administration's proven overall track-record.
The latter shows a fair number of accomplishments despite an awful starting line and a fast changed/changing world economic context.

America is no longer immune to many interplaying variables from outside its borders.
While the rest of the world may still catch cold when America sneezes - unevenly though - America may also get a rough ride when the world stalls...

quarta-feira, 24 de outubro de 2012

TEc - Forward and reverse - European car-makers are hard-pressed

The one and only issue - just about - with car-making in Europe is the deep economic mess the Continent finds itself in.
There are a few bright spots such as Poland, The Czech Republic, Finland, Sweden, Norway, Germany, Austria perhaps a couple more, if as many. Even many of these countries now face tougher times with their own markets beginning to feel squeezed.
Europe - the Old Continent where the motor-car was born - home to some of the best household brand-names the world has ever known is being toroughly tested from within and from without.
The Continent that boasted 4 major world car-making countries for decades: Germany, France, the UK, Italy.
Europe's main decision-makers - a very broad class ranging from industrialists, businessmen, financiers, bankers, politicians, etc - have to act now. They have to deliver on where they wish their individual countries and the whole Continent to stand in a fast changed/changing world.
It is not good enough to candidly say Volvo is now Chinese-owned or JLR is Indian-owned or mock the French State for trying to save Peugeot providing it with a lifeline.
Or realize Italy is now but a junior player in motor-vehicle production having been relentlessly overtaken by new producers who started from scratch.
Or the UK whose volume makers of indigenous brands disappeared altogether.
All these rather seem the outward signs of manufacturing decline brought about by unchecked globalisation, ultra-free capital flows and greedy profit.

Where would US industry be if the Obama Administration had not rescued GM 4 years ago allowing management time to turn its fortunes around? Or in pure capitalist logic is it indiferent for the US economy, society and country to have a GM or not to have it?
Yes there was downsizing, factory closures, brands were lost but the huge company is up and running again. Making cars in America at a profit. In fact, if the American market rebounds further, as looks increasingly likely, it might even open new factories once more.
Europe as a whole, the Eurozone in particular, needs to reshuffle itself by kickstarting the economy with a visionary widespread growth plan.
Not fake growth based on deficits, excessive credit and excessive debt that triggered current woes. One that spurs production and consumption on balanced grounds.
It has been achieved in the past, why not revisit it again?
It is in the very nature of a market economy to witness companies set up shop to grow and prosper while others age, wilt and shutdown. What is very worrying - ultimately untenable - is to see far too many closures, relocations, outsourcings and a willingness on the part of many to deem it as the natural course.
Unless Europe (at the highest levels) considers itself a spent force whose economy, society and political relevance in the larger world is inexorably set to decline absolutely.
I used to think up until recently it need be no more than a relative decline.
The 13m car market has to bounce back at some point in time.
To that end European leaderships must pay much more than lip-service to its wounded economy.

segunda-feira, 22 de outubro de 2012

TEc asks - Will manufacturing return to the West? - I believe every country aspiring to become/remain rich needs manufacturing

A vote that reflects more a wish than a certainty.
For there are far too many variables that interplay in the world of business decisions.
What is now plain for everyone to see is the West in general, Europe in particular, face terminal decline if manufacturing is increasingly lost to other regions. As we debate a trend reversal has not clearly established or if it has I have failed to grasp it.
Rising labour costs in China are of course a natural consequence of the country's growing wealth, development and social aspirations. China's hinterland, however, still holds vast reservoirs of untapped potential before the country's average costs become unattractive to many a Western company seeking to relocate manufacturing.
Then, there are still vast regions of the developing world whose supply of cheap labour, educated to varying degrees, is plentiful.
At the core of it all what is required in the highest circles of the West's power corridors and crucially, company Boardrooms, is awareness as to the multiple consequences of unchecked relocation of manufacturing. One needs to go no further than to examine existing evidence.
Short-term gain to individual companies has already spelt major loss to local communities and a country's economy as a whole. In brief, the sum total of individual companies' gains equals the total loss to a given economy's output. Social and other related losses are not even accounted for.

My argument stands firmly on solid ground:
If the social-economic set-up has not changed relevantly from yesteryear - people still need to consume the same goods to have a decent living standard - manufacturing remains as vital as ever.
Whether the goods are made in A or B country is by no means irrelevant in the larger scheme of things.
Indeed countries that have lost siginficant chunks of manufacturing industry face permanent imbalances even where financial services are strongest as in the UK.
Retaining manufacturing in the West - whatever's left of it - is as much about far-sight as it is about China's and other low-cost regions' attractiveness within a typically capitalist mindset.

sábado, 20 de outubro de 2012

TEc - More pain, less gain - Portugal's troubles add up

Something has changed in Portugal in a matter of weeks.
The government backtracked on its controversial proposal to shift part of the social security tax burden from employers to employees. Then it presented the 2013 budget that jolted just about everyone including the governing coalition as well as prominent members from the ruling parties.
Talk of the day - the 2013 draft budget - rumbles on endlessly until the budget is approved. Many seek to predict the extent of further doom and gloom brought about by punishing income tax raises and cuts to social benefits. 
Others suggest amends or would rather see it ditched altogether.
Few offer workable alternatives that might ease the economic plight.
The Finance Minister has the upper hand as would be expected in such circumstances. Respected for his technical credentials yet accused of social insensivity and for staying aloof.

The country's mood is sad, angered and restive.
Mostly there is apprehension in the air as to what the future holds in store. 
For the underlying case is Portugal is overloaded by a debt pile which is barely manageable under current (and future?) conditions.
The government's top and only priority is to assure that bailout funds keep flowing in (at regular intervals) until the country is eventually able to borrow from markets at affordable rates.

An early return to economic growth seems as distant as ever.
The export sector continues to outperform itself displaying remarkable resilience in the midst of a worsening world economy.
Some say, however, that export growth is explained by sales of household gold and refined oil only. I suspect there is more to it.

Portugal remains in a very tight corner would be understatement.
The country's wish to break free from the shackles imprisoning it is for the moment severely hampered by both internal and external constraints. Until such time as the EU moves forward on key issues of Eurozone's monetary policy.
Or there is an unlikely change of heart by the trio of lenders.

It is hoped that once the adjustment program is complete there will still be an economy and a people sound and upbeat enough to start anew.

segunda-feira, 8 de outubro de 2012

TEc - Meet the Fukushima 50? No, you can't - The true heroes following the Nature-triggered nuclear accident

Revulsion is what I feel on reading this article.
Well over a year since the momentous event at Fukushima in the wake of a major natural calamity hardly any public recognition - endorsed first by Tepco management then by Japan's government - has gone to those 50 brave men.
It goes far to show the workings of Japan's establishment and wider group interests at the very top.
Yet Japan as a country, as a nation, as a technologically sophisticated entity made to kneel down by Mother Nature owes so very much to so very few.
It cannot be overstated that the 50 are the only heroes in the aftermath of the accident. Without their direct intervention - and exposure to unknown risks - much more serious consequences would have ensued.
I deem it highly relevant that the full story of what happened at Fukushima be told.
Praise and outward recognition should be lavishly heaped on the 50 lone men.
Also, official rebuke and public disapproval should fall on those who did not live up to their responsibilities.
All facts have by now been established.
Japan would feel much more at ease with itself if only objective recognition were placed where it falls due: the 50 men who had their hands on the job and their lives on the line and none other could fill in for them.
Least of all Tepco's top manager...or the PM of the day!

domingo, 30 de setembro de 2012

TEc - Concrete jungles - Urban India

Indian cities remain mired in overwhelmingly towering challenges that defy any quantifiable scale. Ranging from unchecked population growth to a lack of or inadequate infrastructure to cope with ever growing multiple needs nearly everything is amiss. From the basic to the upmarket elaborate.
Despite the odds modernity has been seeping through layers of endemic corruption and institutional bad practices.
Successful individual projects bear testimony to this.
For the most part urbanisation in India is a random hit and run process where planning is as poor as its exact opposite is painfully true.
There are of course exceptions to this general rule.
It can fairly be said that concepts such as systematic urban planning and city management have not taken root.
If Surat should represent hope that things can be done differently then all city planners and urban managers from the rest of the country should be taking a hard look at it.

sexta-feira, 21 de setembro de 2012

TEc - The tipping point - Portugal takes to the streets

It does look like a tipping point of some sort has been reached. Question is what tipping point is it?
I have long held the view that austerity was never the right word to define government policies already implemented or in the pipeline. The correct one would be adjustment made forceful on a country whose reliance on external finance became unbearable.
How could it not be whether in a single currency area or otherwise?
The sad thing is it all came to a head suddenly, starkly exposing how unsustainable the trajectory had become.
Of course there could and should be better tools from the EU/ECB to deal with the situation in as severe an economic downturn.
But the underlying issues - imbalances that built up over 15-20 years - had to be addressed sooner rather than later.
There has been a peaceful uprising in Portugal following the PM's latest announcement for the 2013 budget.
It is unlikely that the one measure now made the major bone of contention will get approved in its current form.
A compromise of some type will nevertheless have to be reached on ways to make Portugal's economy more competitive and better balanced between exports and internal consumption.
Quite a difficult balancing act but one that needs to take account of such simple concepts as take-home pay being sacred to any working person anywhere.
Especially when the government must first be seen to be digging into as yet no-go areas of deals struck with private companies in the past.
Tens of notoriously bad public-private partnership deals whose main financial burden falls to the State.
That means the taxpayer having to foot excessive bills over 30-40 years.

A spot-on observation on one of the most intractable problems in Portugal's electoral system. The obvious consequence being the downgrading of Democracy as you rightly point out.
Citizens in many countries hardly feel represented by the politicians they vote for even where direct elections are held. Let alone where they are clearly systemically misrepresented.
Democracies are indeed discredited to varying degrees because the main driver of all activity is found elsewhere not in Parliaments or governments anymore.
This would of course take us into a much wider argument on issues affecting political systems these days.
But yes I would agree the Portuguese electoral system is one such critical issue. I'm not sure it is the crux of the problem.

sexta-feira, 7 de setembro de 2012

TEc - Not too little, possibly too late - The ECB takes action

Finally the ECB is beginning to sound like a Central Bank for all countries sharing the single currency. When called upon to deliver directly on its latest announcements then only will European citizens across the eurozone acknowledge they have not been thrown entirely into the frying pan of financial markets.
For all the specificities of which there are many the whole gambit boils down to this.
It is only fair to say Mario Draghi has made some solid statements on the ECB's readiness to uphold the Euro. He has spoken up consistently since taking over the ECB's top job from JCTrichet. Yesterday he made good on those statements by cobbling together a set of measures that redefine the ECB's role in the current Eurozone context.
However, it cannot go unnoticed that it took Spain's size and potentially Italy's - or nightmarishly both together - to force the ECB spring into action.
While small countries were targeted by bond markets eventually succumbing to the bailouts, the ECB in retrospect effectively failed to stand up for them in earnest.
The ECB has at long last seized its role as a Central Bank would for the Euro-17.
At national and EU level focus must equally shift to growth policies. Not a theoretical approach but a very clear and pragmatic one.
Importantly, to where sound economic growth is to be generated in the future across many countries.
Ultimately the only way for any country/economy to settle dues and refinance itself in the now all but shuttered financial markets.

terça-feira, 21 de agosto de 2012

TEc - Untangling the custo Brazil - Overtaxed?

I am appalled by the contents of the article that if accurate enough reveal an absurdly taxed country.In a sector that should provide a powerful incentive to growth.
Brazil is so blessed by Nature's bounty that power costs are eligible for natural competitive advantage. Yet it does seem like government has made it into a cash cow seeking to extract as much tax revenue from it as its failures to raise elsewhere where it might.
Even if transmissions lines are lengthy and theft occurs - it does to varying degrees in most developing countries - there is no plausible justification for electricity to be as pricey to the end user.
How much more competitive could Brazil's economy be - government still taking in sizeable tax revenue - if only the entire system/cost structure+taxes were adjusted to reflect all variables in a balanced way?
Will there be political drive to deliver fairly and squarely in this
vital sector over the coming years?
Whatever decisions are made going forward, Brazil cries out and deserves significantly cheaper electricity prices for the end user, both private and industry.
Such an objective must be regarded as strategic to the country's overall performance and well-being.
Well within its reach and to be achieved at the earliest.
Will it?

I see your point, there being a number of examples to back up that tendency.
But a tendency it is for it need not be destiny.
Canada and Australia, to mention two major economies with relatively small populations, do defy the notion.
Brazil too is indeed a manufacturing powerhouse in South America with relevant sales of manufactured goods across all sectors from needles and pins to advanced aircraft.

terça-feira, 24 de julho de 2012

TEc - Disunited states of Europe - EU woes

The title to Charlemagne's latest piece is fitting enough.
Tellingly it wraps up the actual root cause of most macro problems now facing the EU.
I was never in any doubt that EU integration would be a slow, painful often heated-and-prone-to-setback process spread out over decades.
How could nations that lived at loggerheads with each other, in fierce competition and animosity over centuries ever hope to stand as one after a handful of years?
That said I cannot help being awed at the level of disunity that has surfaced thanks largely to a flawed economic model. A model based on seeking permanent help from money lenders to plug mounting deficits as if there was no tomorrow.
Rolling debt is acceptable until the debt pile is so huge as to become unmanageable. Yet this is exactly what happened to Southern European countries (Spain excepted), Ireland and outlier UK.
Uncertainty remains the only meaningful word.
The Eurozone's complexity is far from being approached aiming for resolution through balanced compromise.

While I instinctively agree with the points you've raised I am yet to see that silver lining come into full view.
There never was such good timing for a serious review of sorts and ways within societies. Much, however, hinges on prevailing dynamics in each of them. The way government and various leaderships across the full spectrum play out their stakes also featuring decisively.
I would hope to see balanced change driven by a greater goal come about.
As critical as it is for main bodies from civil society to rise up to the times, governments too must lead the way. Not by playing Daddy but by preventing or managing conflict wisely always for the greater good of the greatest number.
Failure to do so will mean a relapse to the very causes of the current mess. Such a mess would then perpetuate itself.
Each man for himself would signal a civilizational leap backwards most of us would not wish for.