Category Archives: A Few Euros More

All AFEM Blog Posts

Planting The News?

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Wow! The FT today has a very long and extensive story about how the US military have been ‘placing’ stories in the Iraqi press. While I don’t disagree with the observation by one commentator in that “I don’t think that there’s anything inherently evil or morally wrong with it” in a war situation, I do agree with another Pentagon spokesman quoted who argues that it is more than just efficacy which is at stake:

“Here we are trying to create the principles of democracy in Iraq. Every speech we give in that country is about democracy. And we’re breaking all the first principles of democracy when we’re doing it,” said a senior Pentagon official who opposes the practice of planting stories in the Iraqi media.

All this takes me back to my Afoe post last week about alleged suggestions that it might be a good idea to bomb the Doha headquarters of the Arabic satellite TV channel al-Jazeera. The point is, you don’t bomb people just because you disagree with their opinions. That in fact is terrorism, not anti-terrorism, and if you want a free and independent pressthen that is what you have to accept, that it won’t necessarily agree with, or support you. The big danger is that the official Iraqi press loses credibility through this kind of thing, and as a consequence the fragile Iraqi democracy also loses credibility.

Morocco’s Offshoring Advantage

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Following up on my Euromed post on Afoe, I see McKinsey have a report of Morocco’s potential as a services outsource base for the Spanish speaking and Francophone parts of the EU (registration required, but easy and worthwhile IMHO):

Morocco’s appeal includes wages for white-collar workers that are half those in France, a relatively high proportion of university graduates, and many citizens who speak French, the second language in the central region of the country. Furthermore, the cost and quality of its already respectable telecommunications infrastructure are set to improve further with the expected entry of Spain’s Telefónica as a second fixed-line operator. The country’s nascent offshoring sector, with an estimated current turnover of €85 million, includes some 50 mostly small providers that will employ a total of about 10,000 people by the end of 2005. Still, Morocco has captured almost half of the fledgling market for call centers serving French-speaking companies. In addition, Telefónica has established a captive call center in northern Morocco, where Spanish is the second language.

Against All Advice

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Well, despite the fact that the eurozone finance ministers aren’t on board, and that the OECD doesn’t approve, Trichet and company will undoubtedly go ahead tomorrow with the first refi rate rise in 5 years. (I think important issues are involved here, so I’ll try and write something more substantial for Afoe tomorrow, when the decision is announced.):

Europe’s finance ministers on Tuesday delivered a last-ditch plea to the European Central Bank not to raise interest rates, amid fresh international criticism of the bank’s hawkish stance.

Jean-Claude Juncker, Luxembourg’s prime minister, claimed inflation was under control and warned the bank that a rate rise could hit growth in the 12-country eurozone. Simultaneously, the Organisation for Economic Co-operation and Development said it believed a rate rise was premature.

Incidentally, the IMF, in the person of Rodrigo Rato, is also contrarian, so this is very much ‘go it alone’ stuff from Frankfurt: ‘into the valley of death, rode the 600’.

What A Surprise!

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The results of the latest GfK’s consumer confidence survey are just in. The results are hardly a surprise. (Btw there is a good discussion of consumption in Germany in this post and comments):

Consumer confidence in Germany, Europe’s largest economy, fell for a second month in three as Chancellor Angela Merkel’s government decided to raise sales tax.

GfK’s confidence index, based on a November survey of about 2,000 people that aims to forecast household spending one month ahead, fell to 3.1 from last month’s revised 3.3 reading, the Nuremberg-based market-research company said in an e-mailed statement today. GfK reiterated its forecast that private consumption won’t increase more than 0.2 percent this year.

Higher energy costs are leaving German shoppers with less money to spend in the holiday season while the prospect of a sales tax increase and an 11.6 percent jobless rate dent sentiment. With the European Central Bank poised to raise interest rates as soon as this week, increased borrowing costs will also crimp spending.

Incidentally Wolfgang Munchau in the FT today states that the recent announcement by Jean-Claude Trichet that the ECB was going to raise eurozone rates “must rank as one of the most bizarre monetary policy decisions of recent times”!

Who am I to disagree.

Much Ado About Nothing?

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The European Commission’s has just published the latest set of EU trade trade figures. Among the surprising details are that overall EU textiles imports were little changed. China textile importas, of course, rose – by 40% – but this was offset by a decline in 54.4% (from Burma) and 41.4% from the Philippines, South Korea, Thailand, Pakistan and Bangladesh also “saw significant falls, by 28.6 per cent, 15.1 per cent, 16.3 per cent and 9.3 per cent respectively”. (all data in value terms and for the first first eight months of the year). As the FT notes the numbers:

“are likely to confirm fears that developing countries are among the main losers after last January’s worldwide removal of textiles quotas.They have struggled to keep up with China’s large and modern clothing production facilities in a liberalised trading environment

“.

One To Watch in Russia

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Russia’s by now well known demographic problems are not, IMHO, going to leave us in peace, the danger is always going to be there of a nasty political evolution which we will in the end have to sit up and take notice of. One of the many possibilities seems to take the form of the Rodina party which Neil Buckley and Arkady Ostrovsky write about in the FT today:

A blonde, Slav-like woman pushes a pram over the rubbish. Then two respectable-looking men arrive. One is Dmitry Rogozin, leader of the nationalist Rodina (Moth- erland) party. They order the men to pick up the litter, while Mr Rogozin’s companion asks menacingly, “Do you understand the Russian language?” On the screen, the slogan appears: “Let’s rid our city of rubbish.”

So runs a television advertisement for Rodina that may have got Russia’s fastest-growing political party banned from elections to the Moscow city parliament next Sunday. The city court ruled this weekend that Rodina’s advertisement incited ethnic hatred and the party should be struck off the ballot. Mr Rogozin is appealing to the supreme court.

The advertisement has been central to Rodina’s campaign for the Moscow parliament poll, the biggest test of its popularity since it unexpectedly won 9 per cent of the vote in national parliamentary elections in 2003.

Remember Me When I’m Gone

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Just when he’s left the FT concludes that Schroder’s labour market reforms are in fact working. It is perhaps worth bearing in mind that although the German economy is producing a lot of jobs, a very high proportion of these are temporary.

Controversial labour market reforms introduced in Germany by Gerhard Schröder in 2004 are showing results, according to data published less than a week after he stood down as chancellor…..The state-run BA employment service in Nüremberg said the total number of job placements by employment offices across Germany would exceed 1m this year, an increase from 496,000 in 2004. The average length of unemployment had fallen from 22 months a year ago to about 21 months today – a downward trend that was set to continue next year.

Revolting High Rises

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Revolting High Rises

Le Corbusier called houses “machines for living.” France’s housing projects, as we now know, became machines for alienation. In theory, the cause of this alienation is some mix of the buildings themselves and the way they’re joined to the city. But in practice, the most effective urban renewal has tended to focus on the buildings. It focuses on the buildings by razing them.