Kaisa Schreck

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Business and Finance

Good News, But Bad News Will Keep Coming

In the wake of the Xinjiang riots, mass casualties and plenty of unwanted press, Chinese leaders were undoubtedly hoping for some good news.

They did not have to wait long. Little more than a week after the Urumqi riots Chinese authorities announced that the Chinese economy had grown by a healthy 7.9 percent in the second quarter of 2009. Compared to the West, this is a spectacular achievement and an encouraging sign for all those that saw the end of the world coming just months ago.

To the surprise of many seasoned China analysts and economists, China’s stimulus package managed to inject much-needed capital into the industrial sector; succeeded in offsetting the worst effects of massive export-industry layoffs by employing migrant workers in government projects, and perhaps most importantly, ensured that government-owned banks continued to lend despite the downturn. Even retail sales rebounded, the government announced, indicating that the Chinese consumer is still feeling confident and secure (unlike the rest of us).

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Categories
Business and Finance

Is Anything Recession Proof?

Indian women in Akbarpura / photo: lecercle, flickr
Indian women in Akbarpura / photo: lecercle, flickr

Well, it turns out microfinance institutions and microenterprises may very well be.

In an interesting reversal of fortunes, small, flexible and locally connected microfinance institutions seem to be fairing better than their larger commercial counterparts in the current economic climate. Due in large part to flexible business models, locally connected operations (microcreditors tend to know their customers much better), low exposure to the hazy world of high-flying finance, and an attractive product, microfinance institutions are flourishing all over the world.

By lending small amounts to poor people with no traditionally defined credit-worthiness, microfinance institutions are keeping the lower tiers of the world economy afloat, even thriving in parts.

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The Power of Photography: Life in a Failed State

Screenshot of Foreign Policy photo essay on failed states
Screenshot of Foreign Policy photo essay on failed states / www.foreignpolicy.com

In an insightful photo essay titled ‘Life in a Failed State’, Foreign Policy provides us with a sobering view on what life looks like in some of the most desolate countries in the world.

Haunting images serve as visual reminders of the failure of national governments and the international community to address the conflicts and history of instability and underdevelopment that underlies their fragility.

The 20 top countries on the 2009 Failed States Index are featured, among them: Somalia, Iraq, Pakistan, North Korea, Ethiopia, Yemen and Sudan.

Further, for a rare glimpse into life in North Korea, check out a haunting slideshow by Tomas van Houtryve for Foreign Policy.

Honesty is the Best Policy

Two boys at a cafe, Makassar, Indonesia / photo: Mo Riza, flickr
Two boys at a cafe, Makassar, Indonesia / photo: Mo Riza, flickr

What do you do when you’re number 126 out of 180 on Transparency International’s corruption perception list? What do you do when prosecuting mid- and high-level officials for corruption doesn’t seem to be doing enough to curb the corrupt tendencies rampant in society?

Well, if you’re Indonesia, you start with the basics. In an ingenious move aimed at teaching people the value of honesty, Indonesia’s attorney general and his provincial counterparts have kick-started a national campaign that aims to open 10 000 so-called ‘honesty cafes’ all over Indonesia by the end of the year. The idea- intuitive and inventive at once- is that instead of paying a set amount to a cashier (someone who is, in effect, employed to enforce morality in a low-level commercial transaction), customers pay an ‘honest amount’  into a clear, unsupervised  box.

In effect they pay what they think they should pay and pay because they know it is the right thing to do (and because others watch them pay). If I ever saw an interesting social experiment on a society-wide scale, this must be it.

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What’s really going on in Iran?

Rioters and police in Tehran / photo: vipez, flickr
Protester and police in Tehran / photo: vipez, flickr

In the wake of a vehemently challenged election in Iran last Friday, the blogosphere and mainstream media outlets are on fire today.

With talk of a totally rigged election (and we’re not talking some lost ballots here), complete with rigged software counting the ‘votes’ of children and dead people, locals, bloggers and journalists are all weighing in on what happened in Iran and where we might go from here. The wildest, and to many the only acceptable, scenario involves the re-scheduling of the entire election due to massive fraud. But how likely is the hardline leadership in Iran to admit its mistake (or rather its crime) and allow for a rerun of the whole process? What happens if the results are allowed to stand? Are we witnessing a hardline ‘soft coup’, as our Tehran correspondent argued in an article published on 11 June, or is there still enough fire in the opposition movement to put the hardline plans under such pressure that they will have to cave in, one way or the other?

Here are some of the best sources for information and opinions on the topic:

  • Our Tehran correspondent, Kamal Nazer Yasin, has written an update, titled Days of Rage for the ISN, detailing the aftermath and likely outcomes of the current stand-off between Ahmadinejad and the opposition forces. The article gives unparalleled insight into the mood, news and events  in Tehran as they unfold on the ground.
  • A blogger on Global Voices has posted Youtube videos of the protests as they unfolded last Friday and Saturday. This gives more insight into how the protests proceeded on the streets of Tehran. The chanting is loud and passionate and the crowds are massive.
  • Michael Tomasky, head of the Guardian’s America bureau has posted an impassioned blog on the election, detailing reasons for why he believes that the elections were rigged. In the Analysis section, the Guardian has also provided some more insights, showing just how muddy the statistics are in terms of vote counts.
  • Ken Ballen and Patrick Doherty of the Washington Post urge caution and remind us that opinion polls three weeks before the election gave a 2 to 1 margin for Ahmadinejad, indicating that the results could be correct.
  • The Meedan site provides more information on the debate over the election results- both a case for and a case against, as well as supporting sources and links.
  • Some striking pictures, courtesy of the Foreign Policy Passport blog, from Tehran on Monday. The opposition forces, it seems, are still alive and well (and growing).
  • Alan Taylor of the Boston Globe has put together a fascinating slideshow on the protests. Please be warned that the last three images contain graphic content.

What do you think?