These are some of the views and reports relevant to our readers that caught our attention this week.
The world’s most valuable resource is no longer oil, but data
A NEW commodity spawns a lucrative, fast-growing industry, prompting antitrust regulators to step in to restrain those who control its flow. A century ago, the resource in question was oil. Now similar concerns are being raised by the giants that deal in data, the oil of the digital era. These titans—Alphabet (Google’s parent company), Amazon, Apple, Facebook and Microsoft—look unstoppable. They are the five most valuable listed firms in the world. Their profits are surging: they collectively racked up over $25bn in net profit in the first quarter of 2017. Amazon captures half of all dollars spent online in America. Google and Facebook accounted for almost all the revenue growth in digital advertising in America last year. Such dominance has prompted calls for the tech giants to be broken up, as Standard Oil was in the early 20th century. This newspaper has argued against such drastic action in the past. Size alone is not a crime.
Pathways for Peace : Inclusive Approaches to Preventing Violent Conflicts
World Bank/United Nations
The resurgence of violent conflict in recent years has caused immense human suffering, at enormous social and economic cost. Violent conflicts today have become complex and protracted, involving more non-state groups and regional and international actors, often linked to global challenges from climate change to transnational organized crime. It is increasingly recognized as an obstacle to achieving the Sustainable Development Goals by 2030. This has given impetus for policy makers at all levels – from local to global – to focus on preventing violent conflict more effectively. Grounded in a shared commitment to this agenda, Pathways for Peace: Inclusive Approaches to Preventing Violent Conflict is a joint United Nations and World Bank study that looks at how development processes can better interact with diplomacy and mediation, security and other tools to prevent conflict from becoming violent.
The year 2016 was difficult for many countries. We estimate that global economic growth slowed from 2.7% in 2015 to 2.3% in 2016. High-income economies struggled with subdued growth and low inflation amidst increased uncertainty about policy direction in light of rising populism. Among emerging markets and developing economies, commodity exporters were most affected by the end of the commodity price boom, growing by only 0.3%—much in line with our estimate of 0.4% growth for South Africa, the lowest growth rate since the 2009 recession after the global financial crisis. By contrast, commodity importers carried the torch of global growth in 2016, expanding by 5.6%.
Resource rich nations face unique challenges when attempting to move from low to high value added activities.
Resource sectors (such as mining and oil) tend to be highly capital intensive and offer limited employment opportunities to accommodate workers exiting from other sectors with lower average productivity, such as agriculture and informal services.
Travelling across Africa these days you are likely to run into increasing numbers of mining, oil, and gas industry personnel engaged in exploration, drilling, and extraction across the continent. Although commodity prices are moderating, the discoveries being made in Africa offer the real prospect of significant revenue to many cash-poor, aid-dependent governments in the decade ahead. If you care about development, the question is whether these revenues will catalyze broad economic development and whether they will benefit the poor in Africa.
Co-authored with FARRIA NAEEM
There is widespread belief among Bangladeshi media, civil society and think tanks that collusion exists in the supply chain of many essential commodities, and many blamed this for the price hike in the first half of 2008. Keeping prices low is a high priority for the government. It is therefore important to measure the presence of market collusion through empirical evidence and design appropriate policy responses to mitigate its impact on prices in order for the government to continue to meet its election promise.
Bangladesh is a net importer of major food items. In the absence of market influences and duties, domestic and international prices are expected to be similar. The convergence may not be exact due to transportation and taxation costs but price should follow similar trends as movements of international commodity prices do not of domestic and international markets do not often vary.
We examine and compare the co-mol prices of four essential food items (coarse rice, flour (atta), salt and soybean oil) over time to look for signs of market influences.
The global economic downturn and the consequent pessimistic outlook for exports in developing countries like Bangladesh have reinvigorated voices for protectionism. Even pro-trade minds have vented their skepticism about trade liberalization, as if the punch of the ongoing crisis could be shielded with the help of an embargo on trade with the rest of the world!
Such thoughts, derived from the gloomy prospects of exports, ignore the potential benefits drawn through the imports and disregard the lessons learned from history- that economic isolation leads to further impoverishment.