Posts of April 2007

China to Top GHG Emissions in 07

♠ Posted by Emmanuel in China,Environment at 4/30/2007 12:53:00 AM

This news from the Independent is not very welcome for you environmentalists out there: In a seismic shift for the world, China will overtake the United States as the biggest emitter of greenhouse gases this year, far earlier than thought - and present the problem of tackling climate change in even more difficult terms. The Chinese economy, which is now growing at the unprecedented rate of 11 per cent annually, is sending carbon emissions from China's mushrooming coal-fired power stations beyond those of the whole of the US, the International Energy Agency (IEA) said yesterday. Less than three years ago the Paris-based IEA forecast that China would overtake the US as the world's biggest polluter - but not before 2025. More recently it said that China would be first by 20...

The World is Flat Taxed

♠ Posted by Emmanuel at 4/30/2007 12:10:00 AM

Here's an interesting article from American.com on flat taxes (please, no remarks on the potential oxymoron):Fifteen years ago, advocates of the flat tax had lots of supporting theory, but very little firm data. Milton Friedman had championed the flat tax, and Alvin Rabushka and Robert Hall of the Hoover Institution authored an elegant book detailing how a flat tax would work, but the political establishment largely ignored these efforts. Hong Kong had a flat tax, but critics said it was somehow a special case. Two other British territories, Jersey and Guernsey, also had flat tax systems, but the outside world was (and largely still is) unaware of those systems. The world has changed. Today, spurred by tax competition, there are now 16 jurisdictions that have some form of flat tax, and two more nations are about to join the club. With the exception of Iceland and Mauritius, all of the new flat tax nations are former Soviet Republics or former Soviet Bloc nations. This is a sign...

Dropping $ = Dropping US Power?

♠ Posted by Emmanuel in Trade at 4/28/2007 07:08:00 PM

Here is an interesting piece from Reuters tackling the issue of whether a dropping dollar is a sign of America's diminished financial standing in the international political economy. I have some problems with it such as mentioning that pricing oil in euros would cause the US more hardships, but it is a thought provoking read nonetheless:The United States may have no military equals, but the challenges to its financial power have become impossible to ignore. A stark reminder came on Friday when the weakening dollar slumped to a record low against its main rival, the euro, after the U.S. economy recorded its fourth consecutive quarter of below-trend growth. The euro hit a record high of $1.3680. The strength of the dollar is more than just a matter of bragging rights. Experts say the consequences of its long-term decline could have deep significance - for average Americans and for the country's position as an unrivaled global pow...

Robert Mugabe, Friend of China

♠ Posted by Emmanuel in Africa,China,Trade at 4/23/2007 01:59:00 AM

China has tried to meet its voracious appetite for natural resources by hooking up with regimes considered toxic in the west. Iran, Sudan, Myanmar...the list grows longer. Here's the latest in a long line of friends with dubious histories, Zimbabwe's Robert Mugabe, #7 on Parade's 2007 list of the World's Worst Dictators. To no one's surprise, state media has made no mention at all of his rather colorful history or the current state of Zimbabwe after twenty-seven years of (mis)rule:Top Chinese Political advisor Jia Qinglin said here Saturday that China will work with Zimbabwe to deepen bilateral reciprocal cooperation in...

Foreign Banks Take RMB Deposits

♠ Posted by Emmanuel in China,Trade at 4/23/2007 01:25:00 AM

After waiting for some time to offer yuan accounts in the presumably lucrative China market, overseas firms will get their chance today. Although it has been reluctant to open up its banking sector to foreign competition, China needed to meet WTO stipulations on financial services at the end of 2006. Note though that these foreign banks will mainly target affluent clients. As I pointed out before, this may have something to do with onerous restrictions designed to safeguard the interests of local banks, most of which are state-owned:To become eligible for the operations being launched Monday, each foreign bank has undertaken a vast restructuring that was mandated by local regulators, including the establishment of a legally incorporated holding company in China. The lengthy process had left uncertain when the long promised access would actually be permitted. According to details the banks published in legal notices over the weekend, they have received approvals necessary to open...

The Philippine Remittance Economy

♠ Posted by Emmanuel in Migration,Southeast Asia at 4/22/2007 08:46:00 PM

There's a lengthy feature in today's New York Times Magazine detailing the reliance of the Philippine economy on the remittances sent home by overseas workers. Again, this third aspect of globalization through migration--the movement of persons instead of capital and trade--gets less attention though it probably shouldn't:About 200 million migrants from different countries are scattered across the globe, supporting a population back home that is as big if not bigger. Were these half-billion or so people to constitute a state — migration nation — it would rank as the world’s third-largest. While some migrants go abroad with Ph.D.’s, most travel as Emmet did, with modest skills but fearsome motivation. The risks migrants face are widely known, including the risk of death, but the amounts they secure for their families have just recently come into view. Migrants worldwide sent home an estimated $300 billion last year — nearly three times the world’s foreign-aid budgets combined....

China's "Mega Import Deals" w/ US

♠ Posted by Emmanuel in China,Trade at 4/18/2007 05:02:00 PM

China is supposedly set to appease trade tensions with America by buying $12B worth of US goods according to China Daily when the Strategic Economic Dialogue comes to the United States: China is likely to ink mega import deals, possibly amounting to $12 billion, with the United States during the second Sino-US strategic economic dialogue next month, in a move to narrow the trade gap. The talks, which will be co-chaired by Vice-Premier Wu Yi and US Treasury Secretary Henry Paulson, are the highest-profile dialogue mechanism over economic issues between the two. The proposed procurement delegation is likely to be led by Vice-Minister of Commerce Ma Xiuhong, covering a wide range of US agricultural and industrial products, from soybean and cotton manufacturing machinery to electronic products. The delegation will visit Atlanta, Chicago, San Francisco and Washingt...

Climate Change IS a Security Issue

♠ Posted by Emmanuel in Security at 4/17/2007 08:58:00 PM

The UK and China have gone at it in the UN Security Council over climate change. First up is British Foreign Minister Margaret Beckett:But Foreign Secretary Margaret Beckett, who chaired the meeting, argued that the potential for climate change to cause wars had to move from the fringes of the debate to the Security Council, the most powerful U.N. body."Our responsibility in this council is to maintain international peace and security, including the prevention of conflict," said Beckett, whose country holds the current council presidency. "An unstable climate will exacerbate some of the core drivers of conflict -- such as migratory pressures and competition for resources."She noted that Ugandan President Yoweri Museveni, whose economy depends on hydropower from a reservoir depleted by drought, had called climate change "an act of aggression by the rich against the poor.""He is one of the first leaders to see this problem in security terms. He will not be the last," she said in...

NRA Response To VT Shootings

♠ Posted by Emmanuel in Education,Security at 4/17/2007 07:35:00 PM

The National Rifle Association (NRA) did not make extensive comments on the Virginia Tech shootings as it concluded its annual conference in St. Louis. There appears to be nothing about the incident on the NRA website. Instead of bringing up the issue of gun control, a former NRA president simply repeated the famous line of "guns don't kill, people do":In a prepared statement, the group sent its "deepest condolences to the families ... and everyone else affected by this horrible tragedy.'' It said it would not comment further. Former NRA President Bob Corbin declined to say what the slaying might mean for NRA's public image....

China Sets 42M Fakeries Afire

♠ Posted by Emmanuel in China,Trade at 4/15/2007 05:05:00 PM

China appears to be making a show of its efforts to combat piracy according to Xinhua News Agency, though I think doing so before the US went to the WTO would have done it more good:China launched a new nationwide crackdown on pornography and pirated tapes and DVDs on Saturday, setting fire to 42 million offending items, Xinhua news agency said. It was the latest in a series of purges which have yet to show much effect in a country where fake designer goods and pirated Hollywood blockbusters can be bought for next to nothing on most street corners. "Through the act of destruction, we wish to show to the world the firm determination of the Chinese government in protecting intellectual property," Xinhua quoted Long Xinmin, chief of the State Press and Publication Administration, as saying. Of the items destroyed, smuggled and pirated audio/video, software, electronic publications made up 30 million, and pirated and illegally published books and magazines totaled 11 million....

Mr. Loverman Paul Wolfowitz

♠ Posted by Emmanuel in Bretton Woods Twins,Development at 4/13/2007 10:54:00 PM

Woman if a loving yuh looking for yuh buck upon the right man (Mr. Wolfie Man)Loving yuh looking for yuh buck upon the right oneDem call me Mr. Loverman dem call me Mr. Lover(World Banka gonna make you feel alright)I am late to this, quite frankly, ridiculous story of Wolfowitz fighting for his survival as World Bank president as I limited my Internet access while away these past two days. Oddly enough, I did mention Wolfowitz's profile on Tuesday in the New Yorker that is now being cited widely for insights into Wolfowitz's special and differential treatment (sorry) of his girlfriend Shaha Riza in her reassignment from the World Bank to the US State Department together with a hefty pay raise. It is not everyday that Nouriel Roubini gets away from his soapbox on Stateside subprime carnage to comment on World Bank shenanigans, but he sets the matter in order by saying "As the World Bank rightly prods countries all over the world to pursue good governance and clamp down on corruption...

China's SAFE is DEADLY

♠ Posted by Emmanuel in China at 4/13/2007 09:17:00 PM

I still get a kick out of the unaptly named State Administration of Foreign Exchange (SAFE) that has the unenviable task of "safekeeping" China's foreign exchange reserves. The biggest problem as pointed out by many are the risks posed to the country of a virtually guaranteed dollar devaluation. What has been galling--to me at least--is that the SAFE English site has lamely tried to cover up China's now $1.2T pile by not updating its figures since, oh, September 2006 at the convenient level of $987B. Message to the Chinese government: just because you don't publish FX reserve figures anymore on the English SAFE site and publish...

Off to PSA 2007 @ Bath

♠ Posted by Emmanuel in Service Announcement at 4/11/2007 02:51:00 AM

Dear readers, I will be attending the 57th Political Science Association Annual Conference at the University of Bath from later today till Friday. Bath is a beautiful and historic city, which is primarily why I decided to present at this conference :-) I hope to keep you posted on interesting papers that deal with issues of political economy. Provided that I can obtain Internet access, I will be posting throughout this event with my trusty del.icio.us and digg bookmarking tools in tow. If you are going, I hope to see you the...

Tom Tancredo for President 2008

♠ Posted by Emmanuel in Election 2008,Migration at 4/11/2007 01:55:00 AM

The isolationist's choice in the 2008 US presidential sweepstakes is none other than Republican Congressman Tom Tancredo from Colorado, who has built his career on a strong anti-immigration stance. He is seeking his party's nomination; given the strong isolationist sentiment Stateside, don't be surprised if he makes at least some headway a la Jean-Marie Le Pen in France during 2002. Despite discontent from the Latin community that Bush's new immigration plan is too harsh on would-be immigrants, Tancredo still believes it is too lenient. As his campaign site states, he is "For a Secure America" (read: illegal immigrants need...

Reactions to US China IP Complaints

♠ Posted by Emmanuel in China,Trade at 4/10/2007 07:36:00 PM

Here are the respective blurbs from the USTR on China's lack of protection and enforcement of copyrights and trademarks as well as its market access restrictions on IP-intensive goods from the US. (The official filings should appear on the WTO site soon.) Industry groups such as the Recording Industry Association of America (RIAA) and Motion Picture Association of America (MPAA) voiced their strong approval of this action. On the other hand, China expressed its--you guessed it--"strong dissatisfaction" over the US complaints. A top Chinese IP official expressed dismay in this manner, though again USTR Susan Schwab was critical...

2007 Reith Lectures: Jeffrey Sachs

♠ Posted by Emmanuel in Development,Environment at 4/10/2007 01:17:00 AM

Economist Jeffrey Sachs of Millennium Development Goals and "The End of Poverty" fame will be delivering this year's BBC Reith Lectures. These lectures will be broadcast on BBC Radio Four at the times indicated (GMT)--they are all on Wednesdays:11 April at 9am (rpt Saturday 14 April at 10.15pm): "Bursting at the Seams"The 21st century will be marked by severe natural resource limits, the rise of new economic powers and the threats of failed states. These are tectonic changes with the potential to unleash global-scale upheavals. Global cooperation of an unprecedented depth and scale will be needed but we are not yet prepared...

Wolfowitz Profile in the New Yorker

♠ Posted by Emmanuel in Development at 4/10/2007 01:02:00 AM

There is a lengthy profile of World Bank President Paul Wolfowitz in the New Yorker magazine that I highly recommend to all of you interested in IPE, international relations, economics, development, or all four. Paul Wolfowitz is a highly controversial figure (especially as a key architect of the Iraq war) and the World Bank already was a highly controversial organization without him; the combination of both has made for some spectacular infighting. The inside angle on the reassignment of Wolfowitz's girlfriend from the World Bank; the skirmish with England's DfID over his anti-corruption measures; accusations of cronyism...

US Files WTO China IP Complaints

♠ Posted by Emmanuel in China,Trade at 4/09/2007 06:44:00 PM

If you've been visiting here, I've given advanced warning--not once, but twice--that the US Trade Representative (USTR) would file intellectual property (IP) complaints against China soon. This issue has been a matter of dispute for the longest time between these two countries. Although the US has held back when on the brink countless times before, it appears that it has now become fed up with perceived Chinese inaction. (Or at least domestic political undercurrents have become too strong to hold back any longer.) Some have estimated Chinese counterfeit goods to account for between 15 to 20% of products made in China. Well,...

"Z" Visa and Its Discontents

♠ Posted by Emmanuel in Migration at 4/09/2007 01:48:00 AM

US President George Bush has long been considered a relatively immigrant-friendly politician. When then-Governor of California Pete Wilson (R) passed the now-infamous Proposition 187 denying public services such as education from illegal immigrants, then-Governor of Texas George Bush (R) distanced himself from such efforts. According to Bush, "I said when it first came out I was against the spirit of 187 for my state. I felt like every child ought to be educated regardless of the status of their parents." Fast-forward a couple of years to the present time with Bush nearing the end of his second term. He is concerned with leaving...

20 Years Ago: ABC Airs Amerika

♠ Posted by Emmanuel in Security at 4/09/2007 01:26:00 AM

I am not sure if most of you are old enough to remember the ABC miniseries Amerika starring Kris Kristofferson which depicted the United States in the aftermath of a Soviet takeover accomplished through the Trojan Horse of UN peacekeeping forces (!?--no John Bolton was not the executive producer). Though many of you are probably guffawing at the very thought right about now, a Soviet invasion seemed like a more plausible scenario back in 1987. While it would only be a few years until the collapse of the Soviet Union, very few among us figured that was about to happen at the time. The USSR with its numerous conventional and...

Moral Complexion of China's Growth

♠ Posted by Emmanuel in China,Development,Religion at 4/08/2007 03:16:00 AM

Pardon me for my tardiness in reading the Economist's recent survey on China's international relations; there is a lot of good stuff from there. Let me list some of these before moving on to the seasonally-inspired title of my post...(1) Here is a transcript of a session on the book Power Shift: China and Asia's New Dynamics, edited by David Shambaugh of the Brooking Institution. Here, various academic authors tackle how China is using diplomacy to ensure that its political weight matches its growing economic clout in the Asia-Pacific region. For those of you in academia, the book is available from ebrary. Much as I dislike...

China Bans More Processing Trade

♠ Posted by Emmanuel in China,Trade at 4/08/2007 02:47:00 AM

China is banning yet more items involved in the processing trade, in which manufacturers in the country add value and then re-export. This move is related to China's efforts in moving up the value-added ladder while simultaneously addressing its widely noted problems with resource-intensity and pollution from heavy industry. While China has had a list of prohibited exports from the processing trade since 2004, it seems that it is only seeing results as of late. I previously mentioned China's efforts to move away from giving export-tax rebates to products from such industries, especially as America's case against China (DS 358) pertaining to export subsidies is about to reach the adjudication stage in the WTO. These are tentative signs that China is backing down:China will ban processing trade in more categories of chemical and resource products in the latest move to restrict the export of resource-intensive products and to balance trade. The 2007 Prohibited List for Processing...

Bush as Development Friend & Foe

♠ Posted by Emmanuel in Development,Environment at 4/07/2007 08:28:00 PM

Two recent articles in the NY Times that deal with development cast the US president in a different light. Let us start with the first article. Here, Bush's efforts to make the delivery of food aid in Africa more efficient by purchasing locally have run into opposition from powerful US interests:For a third year, the Bush administration, which has pushed to make foreign aid more efficient, is trying to change the law to allow the United States to use up to a quarter of the budget of its main food aid program to buy food in developing countries during emergencies. The proposal has run into stiff opposition from a potent alliance...

US to Drag China to WTO Over IP

♠ Posted by Emmanuel in China,Trade at 4/07/2007 01:51:00 AM

Oh boy, it appears there's no rest for the wicked as US versus China trade disputes surface even during this Easter holiday. Though action on it has been held back twice, intellectual property qualms that the US has with China may be acted upon by next week according to Bloomberg:China's illegal copying of movies, music and software cost companies $2.2 billion in 2006 sales, according to an estimate by lobby groups representing Microsoft Corp., Walt Disney Co., and Vivendi SA. The WTO complaints are the first by the U.S. against China for breaching intellectual property rights, in a country where copying has extended to bags, golf clubs and even shampoo. "The U.S. believes that now it's time to put more pressure'' on China, five years after the country became a WTO member, said Standard Chartered Plc's economist Stephen Green in Shanghai. "The U.S. believes that China has clearly infringed rules that it agreed to play by,'' prompting the action, he said... "China...

A Picture Tells a Thousand Words

♠ Posted by Emmanuel in Casino Capitalism at 4/07/2007 01:35:00 AM

The Wall Street Journal has an interesting article on rising home inventories in the US. They have an interactive feature where you can make your own chart to indicate inventories in major metropolitan areas. Being me, I checked everything. Lo and behold, it seems that inventories were higher in a majority of areas in September of 2006, though these figures do not appear to be seasonally adjusted. Click for a larger image:The number of homes listed for sale in 18 major U.S. metropolitan areas at the end of March increased 6.5% from a month earlier, according to data compiled by ZipRealty Inc., a national real-estate brokerage...

A New Trade Policy for America

♠ Posted by Emmanuel in China,Trade at 4/06/2007 09:57:00 PM

For the record, here is a summary of the US House Ways and Means Committee's "A New Trade Policy for America." While the emphasis on "meeting basic international labor standards" and "enforc[ing] common Multilateral Environmental Agreements" appears to be uncontroversial at first glance, these labor and environmental standards may be used in less benign ways as cover for protectionism, red in tooth and claw. Once you go down that slippery slope, there is no telling how far you will go. After all, the United States--the world's largest emitter of carbon dioxide--decided to nonchalantly dismiss the Kyoto Protocol, the mother of all multilateral environmental agreements. Thus, it would be sheer hypocrisy for it to go after other countries on environmental grounds. In any event, take note of this policy for it is the Democrat's take on what President Bush ought to do should he wish to get his fast-track authority extended when it expires at midyear.Also, take note of parts calling...

Hilary Benn on G8 Aid Commitments

♠ Posted by Emmanuel in Development at 4/06/2007 02:47:00 AM

The Right Honourable Hilary Benn, Secretary of State for the UK's Department for International Development (DfID), has asked other G8 nations to live up to the aid commitments they set during the 2005 Gleneagles Summit. (This summit was somewhat overshadowed by the simultaneous occurrence of the London subway bombings.) Benn claims that Britain has lived up to its pledge to increase spending on aid to help meet the Millennium Development Goals, and the others should too:Britain has honoured its promise to increase global aid spending and other countries should follow suit, International Secretary Hilary Benn has urged. His...

A Whole Lotta China Trade Papers

♠ Posted by Emmanuel in China,Trade at 4/06/2007 12:49:00 AM

The IMF is holding an open conference on the Global Implications of China's Trade, Investment and Growth later today in Washington, DC. Though I have qualms about holding a conference on Good Friday (naughty, naughty), the papers to be presented appear interesting based on preliminary viewing. In particular, I have skimmed the Swenson paper which suggests that the presence of multinational firms in specific industries that invest in China may lead to "spillover effects" that boost the export prospects of Chinese firms within those industries. Based on a preliminary reading, the Amiti & Freund and Cui & Syed papers...

About Those Forecasts...

♠ Posted by Emmanuel in Casino Capitalism at 4/05/2007 04:40:00 AM

Above are the results of a poll of economic forecasts from The Titans of Wall Street in the most recent issue of the Economist. As someone who has been bearish on America's economic prospects in 2007 for reasons described by famous bears like Nouriel Roubini and Bill Fleckenstein (who correctly predicted this year's subprime mortgage carnage), I doubt whether the US will manage even the least optimistic predicted GDP growth of 2.0% this year. As Fleckenstein points out, nearly universally bad data nowadays may foreshadow poor results. Worse yet, as America goes, so may the rest of the world--US underperformance will likely...