By Matthew Duhan, Global Counsel
Despite the economic and currency crisis engulfing Ukraine, by 7 o’clock in the evening the National Bank of Ukraine (NBU) is virtually empty. But as the majority of its 12,000 employees head home, lights remain on in a few offices and footsteps echo through dark hallways as a small group of reform-minded individuals arrive for their unofficial night shift. To paraphrase the old line about the Indian economy, at the National Bank of Ukraine reform happens in the night while the government sleeps. Read more
By Olly Buston and Peter Nicholls
Many people think that slavery ended with the demise of the barbaric trans-Atlantic trade 150 years ago. But modern forms of slavery still exist. According to the Global Slavery Index, an estimated 35.8m people are victims of forced labour, human trafficking or debt bondage, more than at any other moment in history. That’s 35.8m people who are more or less completely controlled by another for their use or profit. An astonishing two thirds of these people live in the Brics economies of Brazil, Russia, India and China, with 14m people living in slavery in India alone.
The International Labour Organisation estimates that $150bn of illegal profits are generated each year by the use of modern slavery worldwide. One third is made through forced labour. The reality is that slavery exists in the supply chains of many of the products that we consume. This means consumer pressure has a major role to play in defeating this terrible crime. Read more
By Chris Tucker of MBX Systems
“What do you know about shipping product into Brazil?” When I think of the conversations I have had with our appliance customers over the last several years, this question makes a regular appearance. Brazil’s rapidly growing IT market (estimated at $191bn) and developing infrastructure have been appealing to our small and large customers alike, in markets from broadcast media to security. It is easily apparent why this market is so interesting, but it can actually be more taxing than one may think due to multiple factors.
Read on if you are considering shipping product into Brazil and want to know the challenges of selling and deploying your technology there. Read more
Before Hungary’s general election last April, Viktor Orban, the prime minister, began to laud the advantages of a two-thirds “super majority” in parliament. It gave Hungary a big advantage over its central European peers – its competitors for foreign investment – because it allowed for “quick decision making”.
Orban got his super majority. But “quick” can also mean hasty, ill-considered and lacking in consultation – as Hungary’s logistics sector is finding out. Read more
A problem in a single electricity transmission line running between India and Bangladesh caused a nationwide blackout in Bangladesh on November 1. The outage lasted nearly 10 hours, making it the country’s worst incidence of power failure since a cyclone knocked out the national grid in 2007.
Insufficient energy production remains a major roadblock to Bangladeshi growth. Apart from such poorly maintained infrastructure, power generation is stifled by ancient land acquisition laws that impede mining and a severe shortage in the production of natural gas; coal and gas account for 70 per cent of energy generated in the country. Read more
By Timothy Ash of Standard Bank
A new initiative by the government of Viktor Orban in Hungary appears to be “right-sizing” the country’s banking sector, boosting its efficiency and cost effectiveness as a means to kick start lending. The agenda also appears to be to promote the development of a domestically owned banking sector – 70 per cent domestic ownership is being targeted. To achieve this, state ownership is being promoted as a short term measure to help deliver on the longer term plan.
Reviewing this programme, the obvious question is, what are the Hungarian authorities trying to achieve? Read more
Anything you can do, we can do better.
Malaysian policymakers might not be fans of the hit song from the musical Annie, but they’re acting as if they are, fast FT reports.
Days after Indonesia’s new president, Joko Widodo, lowered fuel subsidies – resulting in a 31 per cent rise in petrol and 36 per cent rise diesel prices – Malaysia has gone a step further. Read more
China’s status as the world’s largest outbound tourism market is in the global spotlight this week after it announced an agreement with the US at the Apec summit to extend the validity of visas for tourists and students between the two countries.
Under the reciprocal agreement, tourists and business travellers between the US and China will now need to re-apply for entry visas just once every 10 years instead of annually under the prior arrangement. The duration of student visas will also be extended from one year to five years. Read more
By Timi Soleye of CRYO Gas
Seated on the dais at an investment conference in one of Lagos’s posher hotels are the luminaries of the Nigerian power sector: the minister of power, the head of the national electricity regulator, the chairman of the presidential task-force on power and chief executives of the newly privatised electricity generation companies and distribution companies. They are desperate for the money of the reluctant foreign private equity managers and local investors who mill about the room.
It is a tough call. On November 1 a year will have passed since the effective privatisation of electricity generation and distribution in Nigeria and it must now be acknowledged that the privatisation is on the brink of collapse. Yet this is a good thing for Nigerians and for future investors. Read more
By Andrey Petrushinin of the Central European Aluminum Company
In a guest post published here on October 10, Milo Dukanovic, Montenegro’s prime minister, asserts that his country is “proving its commitment to Euro-Atlantic values”. This would be funny if it were not so tragically ironic. It seems that Dukanovic is desperately scrambling to make the best of his recent bad scorecard from the European Commission. Read more
By Arturo Porzecanski of American University
José Antonio Ocampo, a former United Nations official and co-president with Prof. Joseph Stiglitz of Columbia University’s Initiative for Policy Dialogue, which promotes the adoption of heterodox economic policies in developing countries, recently wrote a guest post welcoming a UN General Assembly resolution calling for the launch of negotiations on a multilateral framework for sovereign debt restructuring. The resolution was Argentina’s initiative and it passed with the backing of a coalition of developing countries (the so-called G-77 plus China) in the wake of, as Ocampo put it, “the absurd decisions of a New York judge on Argentine debt.” Read more
Investors should be extra careful about betting on South Korean banks, given the sector’s frequent internal strife and failures of risk management.
The latest case is Kookmin Bank, the country’s biggest consumer lender. The bank has come under increasing scrutiny after a series of scandals involving an internal power struggle among its top executives and allegations of leaked customer data, embezzlement and illegal loans. Read more
A long-running dispute between Croatia and Mol, the Hungarian oil and gas company, over control of Ina, Mol’s Croatian counterpart, has flared up again.
Zagreb is seething over a statement issued by Mol after talks on Friday which said the latest round of negotiations had achieved precisely nothing. The ministry told beyondbrics the Mol statement was “a lie” and threatened to publish a recording of the negotiations unless Mol withdraws it. Read more
In the aftermath and shock of the Rana Plaza disaster, in which more than 1,100 people died, many promises were made. Yet the Bangladesh government has been lethargic and its promises of action on factory safety and labour relations have hit familiar walls. Foreign powers, meanwhile, have produced contrasting responses. Read more
By Dalibor Rohac of the Cato Institute
Can the European Union help Ukrainians get their country back on track? Notwithstanding the threat the country faces from the east, the bulk of Ukraine’s problems are domestic: lack of economic growth and employment opportunities, rampant corruption, mismanagement of public funds and burdensome regulation.
In the late 1990s and early 2000s the prospect of EU membership served as an impetus for radical reforms across central and eastern Europe. A credible timeline for joining the Union would certainly improve the prospects for similar reforms in Ukraine. On the other hand, given the EU’s internal problems and the current state of disarray in Ukraine, European leaders are not keen to rush into accession talks. Read more
Ever eager to point out exemplars, the World Bank this week made a point of praising Mexico as one of the few countries where “ambitious and advanced reform agendas” were aiming to transform the economy.
Mexico has already passed some laws liberalising the labour market and improving education, but the centrepiece of President Enrique Peña Nieto’s reform effort is to introduce competition into public and private monopolies: the energy sector, dominated by the state-owned Pemex, and telecoms, where Telmex has been in a hugely powerful position ever since the system was privatised in 1990.
Anyone reading about Bangladesh would be forgiven for thinking it’s a one-industry country. And when it comes to exports, they wouldn’t be far wrong. More than three quarters of Bangladesh’s exports are of ready-made garments. The anniversary of the Rana Plaza disaster, in which more than 1,100 people died, has focussed attention on the industry’s dangers. But what is being done to move the economy away from sweat shop factories? Read more
Tough times ahead for Russian smokers and for the international tobacco groups that feed their obnoxious habit: a ban on smoking in government buildings introduced last year was expanded to include all public places at the weekend, as the Kremlin stepped up the war on Russia’s estimated 40m cigarette addicts. Read more
By Nicholas Watson of bne
A simmering row is building over a memorial to the Czechoslovaks who joined the Royal Air Force during World War 2, highlighting planning issues that property developers in Prague have been complaining about for years.
This year, the British community in Prague including BAE Systems, Tesco and Royal Bank of Scotland raised about €100,000 to build a memorial (pictured below) to the roughly 2,500 Czechoslovak airmen who served with distinction in the RAF during WW2. Read more
In India, summer, when the temperatures soar, is mango season. And no mango variety is as prized as the luscious Alphonso mango, often referred to as the king of fruits.
Alphonso mangoes usually sell at prices out of reach of the Indian common man, as most of the annual crop is exported to Europe, where deep-pocketed consumers are willing, and can afford, to pay more for rare tropical treats. Read more