Author Archives: Edward Hugh

About Edward Hugh

Edward 'the bonobo is a Catalan economist of British extraction. After being born, brought-up and educated in the United Kingdom, Edward subsequently settled in Barcelona where he has now lived for over 15 years. As a consequence Edward considers himself to be "Catalan by adoption". He has also to some extent been "adopted by Catalonia", since throughout the current economic crisis he has been a constant voice on TV, radio and in the press arguing in favor of the need for some kind of internal devaluation if Spain wants to stay inside the Euro. By inclination he is a macro economist, but his obsession with trying to understand the economic impact of demographic changes has often taken him far from home, off and away from the more tranquil and placid pastures of the dismal science, into the bracken and thicket of demography, anthropology, biology, sociology and systems theory. All of which has lead him to ask himself whether Thomas Wolfe was not in fact right when he asserted that the fact of the matter is "you can never go home again".

Russia’s Iran Offer

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Russia is offering to build up to six new nuclear reactors for Iran. I think that if the loss of global consensus attendant on the Iraq war has a price, a ‘less cordinated world’ will be one part of it. I think there is a serious danger of all this getting out of control.

Russia has pressed ahead with construction of Iran’s first nuclear power plant near the southern city of Bushehr, dismissing Washington’s belief that Tehran could use Moscow’s technology and know-how to make an atom bomb. “When Iran announces new tenders to construct nuclear reactors, we’ll take part in them,” Alexander Rumyantsev, head of Russia’s Atomic Energy Agency, told Itar-Tass news agency.

Desertification

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The FT has a timely piece of Spain’s drought. You see, it isn’t simply a question of special pleading on my part :). And note the little detail, 700,000 new homes built last year. I suppose at least when the construction sector stops all those builders will be able to finally cool off.

A severe drought in Spain, the worst since records began in 1947, is playing havoc with livelihoods, sparking forest fires and threatening millions of tourists with water rationing as they head for the beaches this summer.

Worse yet, 2005 is unlikely to be a freak year. Spain is getting hotter and drier, with average temperatures rising by 1?C since 1960. The European Environment Agency estimates that average temperatures will rise by a further 4?C over the next century.

Winters are now so mild that storks have stopped their annual migration to north Africa. Scientists are witnessing desertification many estimate that up to one third of the country may be a desert within 50 years.

Coup de Grace for Italy, or for the SGP?

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Well I got it wrong (or so it seems). Someone has ‘leaked’ to the FT the news that Italy will be ‘given two years grace’ on the deficit problem. If this is confirmed I suppose it shows that the Commission fears more the Italian voters than it does the international financial markets. Obviously a ‘to the letter of the law’ application of the revised SGP would present Italy with hard economic decisions (which she will face anyway), but not applying it tests yet one more time the credibility of the EU’s institutions. It depends I suppose which you think is more damaging in the long run.
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Too Hot For Blogging?

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“Southern Europe was on heat wave alert faced with baking temperatures and drought conditions…….”

“Despite refreshing morning rainfall in Madrid, much of southern and central Spain has been sweltering in temperatures reaching 40 degrees Celsius (104 Fahrenheit) for weeks, though the weekend did bring some respite.”

Unfortunately I’m in Barcelona. The temperatures aren’t much cooler, but there’s no sign of the rain here. Fires, and dehydration victims are going to be the main problems. And, of course, lethargic bloggers :).

Sarkozy Favours Enlargement Freeze

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Nicolas Sarkozy, France’s current interior minister, and 2007 presidential hopeful has said he favours a freeze on future EU enlargement:

“We have to suspend enlargement at least until the institutions have been modernized,” Sarkozy said after talks with Prime Minister Dominique de Villepin on France’s role in Europe after voters rejected the EU constitution in a referendum on May 29. “Europe cannot enlarge indefinitely,” he said.

Promising Elections

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The Guardian today has a short profile on Angela Merkel, while the FT looks at some of the proposals which may well form part of the SPD campaign manifesto. Far be it from me to worry about ‘sting the rich’ tax proposals, but as far as I can see the main isssue is getting Germany back to work, and Schr?der’s time might be better spent adressing this issue.

Talking of which, this could be a good moment to mention the whacky world of Hans Werner Sinn.
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On Negotiations

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A few days back I had a post, Iraq’s Legacy, which dealt with the issue of whether or not the continuing Iraq war was in fact serving to increase the level of international terrorism, and whether at the end of the day we might not be left with a bigger headache than the one we started out with. During the ensuing debate in comments we had a kind of guided tour round a lot of the associated issues, including the one of when you might, and might not, negotiate with terrorists. Well today we have this news, which also helps us put the heroic efforts of Spain’s current government to bring Eta to the negotiating table and away from guns into some sort of perspective. (Zapatero struggles on regardless, despite intense criiticism from the opposition Partido Popular, and despite the ongoing efforts of Eta itself to make life as difficult as it can for him).

CNOOC Bids for Unocal

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All those ‘O’s and ‘C’s, I just couldn’t resist it. So what the hell is this one about. Well, something quite important really. They are oil companies, and one of them is in China. Brad Setser has a great post on it. The issue is what China is starting to do with all those surplus dollars and euros she is accumulating:

“One of China’s largest state-controlled oil companies made a $18.5 billion unsolicited bid Thursday for Unocal, signaling the first big takeover battle by a Chinese company for an American corporation. The bold bid, by the China National Offshore Oil Corporation ( CNOOC), may be a watershed in Chinese corporate behavior, and it demonstrates the increasing influence on Asia of Wall Street’s bare-knuckled takeover tactics.

The offer is also the latest symbol of China’s growing economic power and of the soaring ambitions of its corporate giants, particularly when it comes to the energy resources it needs desperately to continue feeding its rapid growth.”

Bulgarian Elections

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Tomorrow Bulgaria will have elections:

Nearly six decades after Simeon II, Bulgaria’s 9-year-old child-king, was removed by the Communists, their heirs are again poised to oust him from power. The opposition Socialist Party is leading opinion polls ahead of the June 25 general election and is likely to defeat Prime Minister Simeon Saxcoburggotski.

Actually I know a little bit about Bulgaria as I did some research into Bulgarian immigrants in Spain a couple of years back. My impression is that the Simeon regime is extraordinarily corrupt. Many Bulgarians have had to leave simply to send money home to their parents who can only survive with difficulty on the state pensions. Of course, one extract in the article did catch my eye:

Bulgaria’s demographic decline is also likely to favor the Socialists, who count heavily on the country’s 1.8 million pensioners for support. An estimated 700,000 mostly young people have left the country since the fall of communism in 1989 in hopes of a better life in the West

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German Unemplyment Drops (slightly)

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According to preliminary figures released today the number of people looking for work in Germany dropped in June for the third month in a row, but the slight change revealed little evidence of a real labour market turnaround.

Bild quoted preliminary figures from the Federal Labor Agency — the body responsible for compiling monthly unemployment statistics — in its front-page story.

The paper quoted agency sources as saying that the wave of layoffs in the country appeared to be ebbing.

The …..newspaper said that about 60,000 fewer people were jobless this month versus in May, leaving the national total at 4.75 million unemployed.