On Nov. 7, 2012, a motorboat carrying 110 illegal immigrants heading for Malaysia capsized in the Bay of Bengal close to Bangladesh’s southeastern border with Myanmar. This tragedy came less than a fortnight after a boat with more than 135 passengers capsized in the same area. “Boat capsized with illegal immigrants from Bangladesh” is a recurring story, with Thailand, Malaysia, and other Southeast Asian countries the destinations of illegal work seekers. What makes Bangladeshis resort to such extreme methods of migration?
Financial Markets…Year-to-date global corporate bond sales rose to $3.43 trillion, already surpassing 2011’s full year total of $3.29 trillion, as further stimulus from global central banks pushed yields to record lows. Funding costs for the riskiest to the most creditworthy corporates are plunging as the persistent low-yield environment spurred unprecedented investor demand.
- United States
- United Kingdom
- Russian Federation
- Latin America & Caribbean
- Europe and Central Asia
- East Asia and Pacific
- Macroeconomics and Economic Growth
- Financial Sector
- Agriculture and Rural Development
- Industrial Production
- fiscal deficit
- consumer price inflation
- Central Bank policy rates
Financial Markets…US treasuries gained and the benchmark 10-year bond yield edged down 1 basis point to 1.66%, after rising as high as 1.7% earlier, while the 30-year bond yield slid by 2 bps to 2.83% in early Friday session after a government report on wholesale price in September showed domestic inflation remained muted.
Important developments today:
1. European sovereign credit risk rises to eight-week high following Greek debt swap insurance payouts
2. Italy in recession
Important developments today:
1. Eurozone growth projected to slowdown sharply in 2012
Important developments today:
1. Moody’s downgrades 12 U.K. banks and 9 Portuguese institutions
2. U.S. employment growth in September bests economists’ estimates
3. German output falls less-than-expected after July’s surge; but orders slow
These are some of the views and reports relevant to our readers that caught our attention this week.
Africa Can...End Poverty
Two ways of overcoming government failure
"Everyone seems to agree that most, if not all, policy problems have their roots in politics. That is why you often hear that a particular policy will not be implemented because there is no “political will.” Seemingly anti-poor policies and outcomes—untargeted and costly fertilizer vouchers in Tanzania, 99 percent leakage of public health funds in Chad, 20 percent teacher absenteeism in Uganda, 25 percent unemployment in South Africa—persist. Yet these are countries where the median voter is poor. A majority doesn’t vote in favor of policies that will benefit the majority. Why?" READ MORE
The Struggle for Middle East Democracy
"It always seemed as if Arab countries were ‘on the brink.’ It turns out that they were. And those who assured us that Arab autocracies would last for decades, if not longer, were wrong. In the wake of the Tunisian and Egyptian revolutions, academics, analysts and certainly Western policymakers must reassess their understanding of a region entering its democratic moment. What has happened since January disproves longstanding assumptions about how democracies can—and should—emerge in the Arab world. Even the neoconservatives, who seemed passionately attached to the notion of democratic revolution, told us this would be a generational struggle. Arabs were asked to be patient, and to wait. In order to move toward democracy, they would first have to build a secular middle class, reach a certain level of economic growth, and, somehow, foster a democratic culture. It was never quite explained how a democratic culture could emerge under dictatorship." READ MORE
Brain drain—the migration of talent across borders—has an impact on Malaysia’s aspiration to become a high-income nation. Human capital is the bedrock of the high-income economy. Sustained and skill-intensive growth will require talent going forward. For Malaysia to be successful in its journey to high income, it will need to develop, attract and retain talent. Brain drain does not appear to square with this objective: Malaysia needs talent, but talent seems to be leaving.
| Photo courtesy Willem V.
Strien/Flickr under Creative
It is all too easy to see environmental protection and economic development simply as competing philosophies, and nothing more. A range of studies attest to the fact that this is a false dichotomy. In my earlier blog, I described the alternative vision that became a reality in a small Nicaraguan coastal community that chose to invest in a diverse set of clean energy alternatives. Even with cases like this one described in the literature, there remains in some circles a sense that these must be concocted.
The headlines often reinforce this simple dichotomy of environment versus economic growth, where the choice presented is “preserve a forest and forego the lumber”, “save a river and deny a community hydropower”, or “find the financing for more expensive solar power or accept ill-health and global warming from coal.” I have been convinced that another path or paths exist, ever since reading a remarkable paper on the `valuation’ of a tropical rain forest (Peters, Gentry and Mendelsohn, `Valuation of an Amazonian Rainforest', Nature). This short paper got me thinking about how we ignore the longer-term economic wins of sustainability for short-term profit.
I recently had the wonderful fortune to get involved in a case that reinforced the fact that options always exist, if we work together to find them.
Early in 2010, a consortium of citizens from Sabah, Malaysia came to my laboratory at the University of California, Berkeley, convinced that unexplored options must exist to provide the energy needed for this Malaysian Province without placing a 300 MW coal fired power plant on the edge of the ‘coral triangle’ off the coast of North Borneo. This plant was planned at a site only 20 kilometers from the last remaining reserve for the critically endangered Sumatran Rhino of Borneo (of which there may be only 30 individuals or so remaining). This plan would have required the weekly import of coal from South Borneo (Kalimantan). Just a few years ago, the coal plant seemed inevitable.