Friday, April 28, 2006

Star power?

George Clooney and Barack Obama think that the White House might be willing to get tough on Khartoum over Darfur but that they just need some domestic encouragement.
David Adams in today’s Irish Times (subscription required) is sure what he doesn’t want but can’t specify what he does want.
A way has to be found where the UN can intervene to prevent conflict and protect the sovereign rights of hapless individuals. (Indicating a greater willingness to do so would be a start.) But invasion and war, even if logistically possible, are not the answer.

There might not be any options that haven’t been tried before so why not examine the precedents of UN troops entering hotspots with good intentions? They include;

-Mogadishu, Somalia circa 1993
-Srebrenica, Bosnia circa 1995
-Sierra Leone circa 1999

Khartoum doesn't want western troops on the ground and the African Union force (Nigerian and Rwandan troops) which is already there is roundly deemed inadequate. So there aren’t any easy solutions but here is one quite bizarre suggestion. My last post on Darfur giving the current situation is here.
One certainty is the aid agencies could do with more help.

Thursday, April 27, 2006

The Topic Du Jour

I’ve posted before about how I think its best to live with oil for the rest of the Oil age. Right now it’s the topic du jour. The lads over at in fact ah have a good post on it which I’d like to address. They seem to accept the concept that we are reaching ‘Peak Oil’ but I doubt that we are. I think the price is high because global unused refining capacity (the amount by which supply of refined oil is greater than the demand) is very slim and that an awful lot of available supply/production/refining is correctly thought to be located in fragile areas. That is the small picture. The big picture is there is still an awful lot of oil and the Oil age will not end with us burning the last drop of oil, the Stone Age didn’t end because we ran out of oil. If more refining capacity is built, all things being equal the price will come back down.

The oil producers are in a sweet spot right now, they are producing to the absolute maximum and at a record high price. Governments are in the same sweet spot because the greater the oil revenue the greater their fiscal take becomes. The real dynamic is the billions that are being collected by these two groups and what they decide to do with it and that is what I addressed in my initial post. It is a once in a generation opportunity.

Tuesday, April 25, 2006

Charity Art Auction in Donegal

Damien Blake, one of Ireland’s foremost blogging politicians, has posted information on an art auction that will raise money for the Donegal Hospice. The art is by Martin Mooney and the auction will take place in Donegal at the Mayor’s Ball on May 5th. They are also auctioning Bruce Springsteen tickets on Ebay!

I laid down for one week…

So, it was quite severe. And it comes and goes. Maybe in the mornings you feel better, but than around two o'clock in the afternoon you see that you feel cold all the time. And you would be shivering and you have to lay down. And you start vomiting and you vomit and vomit and vomit. Even if you get treatment, sometimes it doesn't go just like that. It takes two, three or four days before you get better. But even if you get better, you can be laying down for two weeks sometimes. But when you go to the hospital, maybe than they give you injection and maybe some tablets of paracetamol.

Roger Casement suffered from it but was hung before it killed him and last year some Portsmouth footballers contracted it. It kills 1.1 million people each year and a child dies every 30 seconds from it. I’ve read that four times this morning and I still can’t get my head around it.
Today is Africa Malaria Day.

Monday, April 24, 2006

Wasted Arrows?

The frustration is evident in John O'Shea's letter in today's Irish Times (subscription required). The World Bank has relieved billions in debt for some very corrupt governments including Rwanda, Mozambique, and Uganda. Debt Relief was supposed to mark a step forward from the bad old days of aid money enabling corrupt leaders to augment among other things their Swiss Bank accounts. Such practice was not only terribly wasteful it also discouraged donors from coming up with further aid.

Aid and debt relief are not benign pills. They need to be administered intelligently or they will cause great harm. Some of the downsides are that they
-can create dependancies
-relieve governments of some of their duties of care to their citizens
-decrease the amount of leverage available to coercise reform

John O'Shea is no doubt frustrated as once these arrows are wasted there is less available in the quiver. His charity GOAL is reknowned for its efficiency and for their selection of projects to maximize impact for those who need it most. The World Bank would counter that they are fighting the problem going forward and they are getting to grips with corruption, today's FT reports -
Paul Wolfowitz, the president of the World Bank, yesterday pledged to develop a formal framework for dealing with corruption in developing countries, a move urged on him by European shareholders anxious that his anti-corruption drive should not paralyse the bank's lending and lead to it abandoning people in need.
Britain and some other European countries have pressed Mr Wolfowitz, the former US deputy defence secretary, to put greater emphasis on fighting corruption by building institutions in the developing world rather than simply suspending loans where corruption is suspected.

It seems like an impossible task but they are persuing more than one avenue. Rather then focusing solely on corrupt regiemes they are recognising that for every bribe taker there is a bribe giver and that many of these bribe givers are western. They already have a blacklist of such companies. Its a start.

Thursday, April 20, 2006

This is a map of the world where...

This is a map of the world where each countries size is represented by the number of emigrants that leave that country. The World Bank has released a major report on the effects of migration on developing economies.
It seems emigrants originating from quickly developing countries like India, Mexico and the Philippines send such significant amounts of money home that they considerably effect growth and investment in their original countries. Mexico and India are particularly easy to find on the map above. However remittances from those that leave underdeveloped countries do not come close to adequately compensating their home countries for their ‘Brain Drain’.

Apparently there are more Malawian doctors in Manchester, than there are in Malawi and Malawi has one of the highest HIV infection rates in the world. Similarly 47% of Ghana’s highly skilled workers live in the 30 OECD countries.
The Ford Foundation largest ever program, a USD 280 million investment with a recent additional USD 75 million, the International Fellowships Program is trying to redress this problem and is worth checking out.

Wednesday, April 19, 2006

What do Illnois, Burundi and Goa have in common?

They have all have seriously addressed the issue of mandatory pre-martial HIV testing. In Illnois and Goa’s case it was at a government level, in Burundi it was at a church level.
When it comes to individual’s rights verses the protection of society - HIVS/AIDS throws up the most challenging moral dilemmas. The slogan ‘AIDS doesn’t discriminate, do you?’ is well known and aims to remove the stigma that adds to AIDS victims suffering. This is a desirable goal but to say AIDS doesn’t discriminate is misleading.

AIDS successfully targets societies that suffer from Poverty, War, Weak leadership, Diminished women’s rights and/or Diminished Sex Education. It is such a difficult threat to tackle because it flourishes in societies that are already under threat from the aforementioned menaces. When sorrows come, they come not single spies, but in battalions. Is it possible to have success tackling AIDS without draining the swamp of these problems and is possible to reverse the momentum once it is in motion? Furthermore AIDS is becoming less of a symptom of these crises and more of a catalyst for them. The realities on the ground are not much to our liking and yet we must deal in these realities in order to combat the threat.

When you look at the numbers it soon becomes clear that prevention is easier and more effective than treatment, yet both are necessary. A key to prevention and removing the stigma of HIV/AIDS is testing. Testing is the key as individuals are unlikely to change their behaviour if they don’t know their HIV status.

-Should HIV positive people be excluded from the army?
Our western sensibilities would of course say no - AIDS does discriminate, neither should we – and yet peacekeeping forces in Cambodia and Sierra Leone have been linked to the spread of the disease in those areas. Having recognised that the military is both a ‘highly at risk group’ and ‘major spreader’ of HIV Russia and Zambia now test military recruits. Uganda's army has a "Post-Test Club" which works with soldiers to promote openness and dialogue about the disease. In Bangladesh and the Philippines HIV-positive soldiers are automatically discharged.

-AIDS is heading East
By 2010 the largest HIV/AIDS populations will be in Asia rather than Africa. India, China and Russia are the next wave of countries that will have HIV/AIDS populations that will be a critical drain on their societies. It is projected that by that year India will have a HIV/AIDS population of 20 to 25 million. Young women are the most at risk and young women are already at a disadvantage in India due to marital traditions. So should the government make HIV test mandatory for couples before marriage and would it help? It could be a start but it would have unintended consequences - it would violate privacy, stigmatise entire families and create a black market in false HIV-test results amongst other consequences. Furthermore couple that are 'in the clear' could subsequently be more at risk from infection through infidelity. The state of Goa in India has an estimated 5 million HIV positive people and the UN is urging it not to make testing compulsory for couples who want to get married and yet it still plans to make the law effective in July of this year.

Stuart notes,
Back in 1988, Illinois passed a law requiring premarital HIV testing as condition of obtaining a marriage license. This had an interesting effect: the number of marriages in Illinois dropped 14% while the marriage rates rose in the neighboring states. When the law was repealed, the number of marriages in Illinois returned to its pre-1988 level. Perhaps the governors of Goa should take note.

Success stories in the fight against AIDS are rare and sometimes disputed but Brazil seems to be the best example. In Brazil education, condom availability and free AIDS drugs brought the threat under control but what works in one particular culture and at one economic level may not work in another. Combating AIDS always ruffles feathers, Brazil abused drug patent laws to bring its problem under control. When it comes to Goa, it should make full use of UN expertise and precedents but the regional government knows the situation on the ground best and should make the informed decision that it thinks is best for its citizens.

Wednesday, April 05, 2006

I will be absent without blog...

...untill after Easter

Trial indicates exactly how not to tackle a nightmare epidemic

South Africa is the epicentre of the Global AIDS epidemic. It is estimated that 1 in 3 deaths in South Africa are a result of AIDS and 3 in 10 pregnant women are HIV positive. Stuart has an update on the rape trial of former South African deputy president Jacob Zuma. Zuma is accused of raping a women and she is HIV positive.

Yesterday saw Zuma take the stand to be questioned by the state prosecutor. The prosecutor asked a simple question independent of the rape charge. Why, the prosecutor asked, would the previous head of the South African AIDS Council and the Moral Regeneration Movement have unprotected sex with a woman he knew to have HIV? His answer was noteworthy: the risk of acquiring HIV through unprotected sex with a woman, he stated, is small for a healthy man. “I had the knowledge that …chances were very slim that you could get the disease.”

How would you feel if you paid more in tax than someone who earned 15 times more than you?

In my opinion improving the terms of trade is the simplest and best way to help the developing world. As I have suggested before, capitalism can be a poor countries best friend. Therefore the latest developments in the Doha trade negotiations don’t look good. The EU won’t budge on their agricultural subsidies and the US are beginning to call their differences with the EU ‘irreconcilable’ and it looks like both the US and the EU will favour improved bilateral deals with targeted nations rather than agreeing a significant Doha deal.

Doha was supposed to reduce farm subsidies and improve trade conditions with the developing world. Ben provides an incite into what bilateral trade looks like in practice. In January 2006 the US imported goods worth nearly $3 billion from France and almost $ 0.2 billion in goods from Cambodia. How much tariffs did they charge on each of these? Actually it was about the same amount, $30 million (Cambodia paid slightly more). They traded 15 times more goods with France than Cambodia but collected about the same nominal amount in tariffs. This is what international trade injustice looks like.

Tuesday, April 04, 2006

A little web alchemy can mean a lot of generosity

Some people like to donate stock portfolios to charities and typically the charity doesn’t know whether it is best to liquid them straight away or hold on to them and see what happens. There was much scratching of heads at the Boston Foundation when they received something much less tangible. Tom Bird registered way back when things were just kicking off the web. It has since become a very valuable asset and he decided to donate it to the Boston Foundation. The charity in return sold it to Pets United LLC, which already owns, and horse for USD 200,000.

In a similar vein Des Walsh has a great post about Freestyle Media’s innovative charity fundraising technique, they are ebaying their firms services for 24 hours and donating the proceeds to a Cancer Charity.

Monday, April 03, 2006

Who would be a Third World Central Banker?

Monday morning quarterbacks have the easiest jobs in the world. Good Central Bankers don’t make spectacular headlines but surely they have one of the most difficult jobs in the world. ‘Bad’ Central Bankers make the job harder for themselves and the Monday morning quarterbacks generally write the headlines.
Being a Central Banker is not like thinking five moves ahead in chess, its more like steering a ship that is in a constant state of metamorphosis - you angle the rudder now not knowing what you’re your speed will be in five minutes time and the effect of your course correction wont be evident for more than five minutes – its hard to see the obstacles and sometimes your instruments don’t work as expected. You often have to plug leaks and worry about what is below the surface. Listed in your hold is the entire financial well being of your country and least of all that is at risk is your professional reputation.
Global financial markets make the job even harder. A crisis is now unfolding in Iceland and much has been made by commentators of the ‘carry-trade’.

Iceland has had high returns, high interest rates and it is possible for financial operators of all shapes and sizes to borrow money where it is cheap – Japan or Switzerland - and put it into places like Iceland where they will get a much higher return. Of course they leverage the size of this trade to increase the returns and this increases the temperature and sensitivity of the money. Give it time and it accumulates – the longer you watch financial markets the more you come to love rivers. Rivers pay absolute respect to the path of least resistance. If the source of the capital becomes more expensive the net gain narrows – resistance rears its head and the course is changing. Recently high-return Dubai’s stock exchange suffered an experience that can be described as violent vomiting combined with close-door-panic. Iceland’s stock market and currency are now suffering the same. The currency has fallen 10%. Last week the Central Bank increased rates by 0.75% - quite a dramatic move intended to support the currency, the lifeblood of the economy. I’m not familiar with David Oddsson, Chairman of Central Bank of Iceland but he has probably looked at his clock during one of the many recent sleepless nights, made a quick calculation and wondered if he could get put through to the world’s most employable brain - the recently retired Alan Greenspan - in order to get a little friendly help.
If you are forced into a corner global speculators will pulverise you quicker than you can say 'Check-mate' and then no matter what you do the levee breaks.

Larry Summers said “Global capital markets pose the same kinds of problems that jet planes do. They are faster, more comfortable, and they get you where you are going better. But the crashes are much more spectacular.”
If you think its difficult being the Central Banker of a small developed economy of 300,000 people in Iceland imagine how much more difficult it would be in South America or Sub-Saharan Africa. For them the potential pitfalls are the same but your backbone; regulation, independence and fiscal discipline can be much more wobbly. The list of these man made disasters is stunning. Countries that have experienced a crisis that has destroyed more than 10% of their GDP include; Spain (1977), Israel (1977), Japan (1991), Finland (1991) and South Korea (1997) and they are not exactly novices at this game. Look at those that have suffered a crisis that has destroy between 7% and 10% of GDP and you will see Norway (1987), Australia (1989) and New Zealand (1987). Norway! Iceland is joining some impressive company there. It is obviously a jungle out there and if you are a small time player at the more susceptible end of this territory it would be great to be able to learn from a man-made miracle to negotiate the treacherous seas. The good news there is one but who or what is this oracle? Ireland? not really, the IMF? Ha!, Greenspan himself? not even he has that great a track record. It is Botswana.

If there has ever been an economic miracle it is Botswana. In 1965 it was the third poorest country in the world – it then underwent a thirty year growth period when average growth was 7.7%. You should never mix economics and sport but that is kind of like getting promoted thirty years in a row without ever going wobbling – it is the best growth rate of modern times par none – the Celtic Tiger, China or even Hong Kong can not touch it. Mrs Mohohlo is the Governoress of the Bank of Botswana and it is the vintage Rolls Royce of global economies, it might not be the biggest or the fastest but the engine is sound and the paint job is pristine. Even the Swiss would be green with envy.
How did they do it? Pretty simple they diversified their economy and didn’t rock the boat. They got advice from the IMF and World Bank but crucially they didn’t take money from them (that has been the kiss of death for many emerging economies) – so it was free advice that they weren’t forced to follow. They didn’t try juggling more than they could handle and they didn’t tinker too much. Sure they have massive diamond reserves but so has Sierra Leone and South Africa, Saudi Arabia has oil and the Congo has gold; all of those countries can be seen to have been cursed by such resources. Botswana has been a peaceful parliamentary democracy since 1965, its governing institutions are strong and it has got the basics right. The most shocking thing about all of this sustainable development is that it wasn’t achieved at the detriment of anyone else; in short it could be easily argued that any African economy could have done the same – Africa doesn’t have to be poor. The model is there.