Hong Kong, PRC, Democracy & the 'Sixth Column'

♠ Posted by Emmanuel in at 8/31/2014 01:30:00 AM
Would you like to see Britannia rule again, my friend? The worrying thing about Chinese President Xi Jinping is that unlike his modernizing predecessors, he appears not to give only lip service to Marxist-Leninist-Maoist rhetoric but may actually believe in that schtick. Once upon a time, before Xi Jinping, Hong Kong's integration was supposed to be based on "one country, two systems." These days, however, more militant residents are calling China on it while choosing who gets to stand during elections. To paraphrase Henry Ford, you can vote for anyone you like--as long as they've been vetted by the Communist Party. During...
Read More

IMF Conditionalities Don't Matter...If You're 'Ukraine'

♠ Posted by Emmanuel in at 8/30/2014 01:30:00 AM
 If we go by the Weberian definition of what a state is, "Ukraine" fails on the counts of territorial integrity and having a monopoly on the legitimate use of force. Into this muddled picture comes the IMF. The characterization of the IMF as a Western tool is well-founded and not subject to much debate, at least in IPE circles. Today's case in point is the "country" of Ukraine. While Ukraine as we know it has ceased to exist and so has its economy, the IMF is busy shoveling wads of cash in Kiev's direction and will do so for as long as it doesn't go over to the dark side (Russia). Being broke would hasten that process....
Read More

Morgan Stanley & the Making of Rosneft

♠ Posted by Emmanuel in , at 8/29/2014 01:30:00 AM
Morgan Stanley's John Mack chillin' with Putin back in the day. The recent (re-)isolation of Russia after coming in from the cold after the end of the Cold War is having interesting repercussions for its Western financiers. From an IPE standpoint, the fate of the giant oil conglomerate Rosneft will be pivotal. Not only is it a gargantuan oil firm, but it is also a creation made possible through Western bankers providing the investment necessary to put it together. Today's case in point is Morgan Stanley's involvement in the formation of modern-day Rosneft. It remains quite a reward for Igor Sechin's fealty to Vladimir...
Read More

Modi's India: Japan or China as Business Muse

♠ Posted by Emmanuel in ,,, at 8/28/2014 01:30:00 AM
Japanese, Chinese want the "Gujarat Model" replicated across India. The selection of Najendra Modi as India's prime minister is taken as a sign that the rest of the country wishes to follow in the footsteps of Gujarat state that he used to govern--a liberalizing, open-for-business attitude that has seen it attract a considerable amount of foreign investment. The Japanese, in particular, seems excited. Having invested a lot in Gujarat, they look forward to similar liberalization and FDI-friendly measures being put into place nationwide: Japanese executives at the meeting were also ebullient, praising the business sense...
Read More

Will Ebola Stop the African Cup of Nations?

♠ Posted by Emmanuel in , at 8/27/2014 01:30:00 AM
Another Ebola Victim? The 2015 African Cup of Nations. It's only a game, the refrain goes when people take football too seriously. In Africa, though, it may be a game of life and death. Recently, a player died from being hit by a rock thrown at the end of a match. Now, the outbreak of the deadly Ebola virus for which there is no cure is threatening to stop the continent's most prestigious international tournament, the African Cup of Nations. There always seems to be interesting IPE-ish stuff going on with this tournament. Four years ago, I discussed how China was using "football diplomacy" by building stadiums for Angola...
Read More

World's Governments vs Uber: In South Korea, India

♠ Posted by Emmanuel in ,, at 8/26/2014 01:30:00 AM
To Gangnam, man, on the double! (wherever that is.) Libertarians for the most part tout the ride-sharing service Uber as a way to avoid taxis whose need to be government-regulated allows them to charge exorbitant fares. With Uber, anyone who can afford a smartphone and a data plan can use his or her vehicle as a privateer taxicab. Break the monopoly! Or that's how Uber works in theory. In practice, local governments the world over have taken legal action against the app's developers for skirting regulations on who can offer tax services in their jurisdictions. I do not exaggerate when I say it's Uber against the world's...
Read More

The Big One: Saudi Arabia Sells Stocks to Foreigners

♠ Posted by Emmanuel in at 8/25/2014 01:30:00 AM
It's Riyadh or bust, baby. The never-ending chase for better investment returns brings us to the doorstep of Saudi Arabia. The country remains an enigmatic mix of integration and isolation with the world economy. For instance, the same government that now funds one of the premier research institutions in the region, the King Abdullah University of Science and Technology (KAUST), has long paid what is in effect hush money to fundamentalist educational groups which have helped radicalize impressionable youths the world over. Or, the same country that is a G-20 member does not allow women to drive cars. One of the restraints...
Read More

Another Papal Accolade: Top Car Salesman

♠ Posted by Emmanuel in ,, at 8/22/2014 01:30:00 AM
This Kia Soul pitchman beats dancing hamsters hands down. You'd think that being "vicar of Christ" would be a heavy enough burden. To the list of many accolades accorded to the current leader of the Catholic church, however, add this one: "savior of Korean manufacturing." You see, Pope Francis recently visited South Korea after receiving an invitation to go there. Unlike the nominally godless North Korea, over a tenth of South Korea's population is composed of Catholics. It is just as well since Korea has been in need of divine intervention as of late given the economic headwind of a fast-appreciating currency. One of those...
Read More

Futbol Geopolitics: Crimean Clubs Join Russian Leagues

♠ Posted by Emmanuel in , at 8/21/2014 01:30:00 AM
"We're all Russians now," Sepp tells Vlad. With the end of the World Cup, I haven't had a single football (soccer)-related post. Let's fix that right here, right now. There's an interesting feature from BBC News on the consequences for incorporation of the Crimean peninsula into Russia through a "referendum." Say what you will about the legitimacy of that vote, but there is no doubting that a vast majority of people there would have wished to join Russia anyway. A rather visible manifestation of this ongoing (re-)integration of Crimea into Russia is that a number of clubs that formerly belonged to the Ukrainian league...
Read More

Money Laundering or Investment? Chinese Buy Oz Property

♠ Posted by Emmanuel in at 8/20/2014 01:30:00 AM
What is capitalism? What is state-driven capitalism? The blurred distinction between the two gives rise to now-frequent crackdowns on Chinese businesspersons during Xi Jinping's current drive to supposedly reduce corruption in the PRC. Unless you're a die-hard Marxist--property is theft, more so in a "Communist" state--the distinction isn't so clear. In an earlier post, I described how many Chinese are hedging their bets by seeking residences abroad should the purge in China reach Cultural Revolution proportions. While that's a remote possibility, you never know. Apparently, one of the choice destinations for the Chinese...
Read More

If Hell Comes: Preparing for UK's EU Departure

♠ Posted by Emmanuel in , at 8/19/2014 01:30:00 AM
Some are intent on killing the goose that lays the golden egg. Never underestimate the human potential for acting stupidly: The UK's ruling Conservative Party has long been playing fire with its Eurosceptic stylings. By bashing the EU and its alleged overregulation at every turn, their intent is to use possible UK departure from the EU as a leverage point to gain more exceptions for its financial services industry. The Tories now plan to hold a referendum on the matter of EU membership if reelected out of electoral self-interest. Now, imagine if UK voters are sufficiently peeved at Europe to vote for leaving it. There's...
Read More

Physical Banks are History: Pakistan m-Banking

♠ Posted by Emmanuel at 8/18/2014 01:30:00 AM
It may sound strange to people from rich countries, but most people in the developing world have never set foot in a bank branch. Not only are they often confined to urban centers, but they are also geared towards meeting the needs of wealthier clients. To correct both of these failings in banking the so-called "unbanked" or folks without access to financial services, m-banking has become popular in many parts of the developing world. That is, mobile services become instruments for delivering financial services. Today's example is particularly instructive: Pakistan is a perennially hard-up country riven by never-ending...
Read More

Chinese Fleeing PRC: The Hotel California Effect

♠ Posted by Emmanuel in , at 8/17/2014 01:30:00 AM
There's no getting away from the PRC, mates. There's an excellent article at the WSJ concerning wealthy Chinese leaving the PRC...for good. It is fairly common for wealthy people in poor countries to secure overseas residences in the event trouble breaks out at home. That is, they have safety nets if, say, the Communist Party starts persecuting capitalist roaders by tossing the in jail or packing them off to reeducation camps. You never can tell when the Communists have an urge to start acting communistic. What I was not aware of, however, is that a fairly large exodus is already underway even in these years of PRC prosperity....
Read More

Atlantic City or Detroit: Which Epitomizes US Decline?

♠ Posted by Emmanuel in , at 8/14/2014 01:30:00 AM
They partied till they literally dropped. Thousands of years into the future, when archaeologists sift through the ruins of the United States as they currently do with empires Aztec, Babylon, Carthage to Zulu, what will be their preferred excavation site for artifacts of once-unrivaled splendor reduced to absolute nothingness? Detroit is a prime candidate given its many imposing edifices long deserted. They even make massive photo essays about it. Motown, however, lacks the tabloid-grabbing bacchanalian excesses that I call "history porn": Babylon has been immortalized as the epitome of sinful existence in the Christian...
Read More

Unlike China: India's Civil Approach to Territorial Disputes

♠ Posted by Emmanuel in ,, at 8/13/2014 01:30:00 AM
Civil sorts prefer going this route. This Southeast Asian is rather tired of intrusions by would-be imperialists into our waters: China and the United States are similarly bullying presences, with the former coming more and more into the focus as the latter embarks on the road to nowhere fast. In the study of international relations, there is the so-called "power transition theory" which is frequently invoked to explain how Southeast Asia is being caught in the crossfire between these rival powers: One by-product of differential growth is the high potential for conflict when a challenger [China] and a preeminent or dominant...
Read More

Could Military Rule Work? Thai Junta & Phuket

♠ Posted by Emmanuel in ,, at 8/12/2014 01:30:00 AM
Cleaning up paradise. As a pragmatist, I am not wedded to ideas that "democracy" and "free markets" are necessarily the best solutions in all places at all times. If you want simplistic, crusader-grade pontification, there are many other places for you to visit. For a case in point, consider what was happening to Thailand's famous beach resorts during the years when the Thaksinite red shirts were in power: wiseguys were abusing the system, making private what was public for their own gain. With the ouster of sister Yingluck Shinawatra's regime through a military coup, Westerners were ostensibly aghast at this violation...
Read More

China's Plan on Full Yuan Convertibility in 2015

♠ Posted by Emmanuel in , at 8/11/2014 01:30:00 AM
Decisions made in this building shake the world. It's kind of hard to relinquish on Stalinesque, iron-fisted control once you get used to it: Around 2011, PRC official sources made some noises giving tacit support to the idea that their currency the yuan (RMB) would be fully convertible by 2015. Through fits and starts the yuan has gradually appreciated since then, but now the People's Bank of China (PBOC) has come to an important fork in the road of monetary development: to become fully convertible or not? That is the question that needs to be resolved before 2015 rolls around. Just like an anxious bride-to-be antsy about...
Read More

Pity the Children: 'War on Drugs' Fuels Asylum Seekers

♠ Posted by Emmanuel in ,, at 8/10/2014 01:30:00 AM
This train of pain begins and ends in the United States. I am not sure if there is a moral to recent events, but the number of children seeking asylum in the United States from gang warfare-torn countries El Salvador, Guatemala and Honduras has dropped in the last month. What to do with these young people has given rise to a fierce debate Stateside on an issue Obama would likely prefer not to deal with domestically at this point in time: immigration reform. With an ever-growing Latino population, the stakes are high for center-left politicians like him. Even so, the Tea Party brigade is hung up on antiquated notions of...
Read More

USA vs Russia: Real Victims are the Chickens

♠ Posted by Emmanuel in ,, at 8/08/2014 01:30:00 AM
The victims we know so well / They shine in your eyes when they kiss and tell. The main difficulty for the United States in applying trade sanctions against Russia is that, well, there is not really that much trade between them. The US doesn't buy significant amounts of oil and gas from Russia--its main lines of export. On the other hand, Russia usually reacts to these sanctions by halting imports of the major agricultural product it does import from the US. It's not consulting services, financial services, or the like. Instead, it's poultry as the real losers in this game of chicken are our fair feathered friends:  In...
Read More