Sunday, August 3, 2008

The China model???

This one is from the NYT:

There is no single “China model” to running a mega-economy. Instead, it is a blend. From the Europeans and the Japanese, the Chinese have borrowed the concept of protecting essential industries. So the state is striking exclusive oil deals around Africa, keeping a loose but steely hand over media outlets, and cracking down — even executing a few people, when needed — to respond to scandals involving tainted food or defective goods.

But the Chinese realized quickly that Japan’s downfall came in part because it never created a culture of innovation. The Chinese know they do not want to be assembling low-cost goods for long — and so they are experimenting with companies like Lenovo. Lenovo, a sophisticated computed manufacturer, is also a Chinese corporate sponsor of the Olympics. Its design won the competition for the Olympic torch — an intended symbol of China’s rise to the rank of a near superpower that, during its relay around the world, also came to signify Chinese repression in Tibet and beyond.

Sliding towards Socialism

I have always been skeptical about the Maoists' ability to steer the economy towards a path of success because of their anti-market behavior(I have been always critical of their planned land reform program). Now, they have agreed to form a government and have a 50 point common minimum agenda. And, there are a lot of commissions:

...In the program, the Maoists pledged to form a peace and reconstruction commission, a truth and reconciliation commission, a state restructuring commission, a commission on disappearances and a land reforms commission. It has vowed to make necessary arrangements for monitoring past peace accords through the peace and reconstruction commission.

Besides, the program proposed an administration reforms commission, a youth commission and a powerful Muslim commission.

...The Maoists proposed a model of economic activity through the partnership of government, cooperatives and the private sector. It pledged to formulate immediate short-term, mid-term and long-term plans for development and give priority to agriculture, hydropower, tourism, human resources and infrastructure.

The Maoists have proposed to categorize hydel projects for purposes of investment. "Small and medium-size projects will be run through internal investment and big and export-oriented projects through foreign investment," the proposed program stated.

...The Maoists propose to attract foreign investment in industrialization and development for the benefit of the country. The party pledged dual citizenship for Non-Resident Nepalis to attract their investment in national development.

The Maoist program proposed revolutionary land reforms to end feudal ownership of  land and establish access of peasants to the land.

The program also proposed that primary health care, employment and education up to high-school will be made part of the fundamental rights of the people. The party proposed to reduce the age criteria for senior citizens to 70 from existing 75 for purposes of the old age allowance. It pledged an increment in the allowance amount for widows and old people.

 

Food crisis in Nepal

Sky News has a good series of articles, some of them focusing on a typical Nepali household, about the impact of rising food prices (HT: Deepak's Diary).

24 Hours of A Nepalese Diet (the reporter experiences firsthand how it feels to live in a typical Nepali household)

Life Below The Breadline in Nepal

Lush Land Where Millions Need Aid

This one makes me homesick:

...There's no running water either, so Anju has to wash the vegetables in rather murky water from a container. Quite a bit has gone into the cooking too. I notice that the dal, which Anju complains has become so expensive lately, was thoroughly diluted.

Markets at work (if you try to destabilize equilibrium by charging more, demand will decrease!):

...I work in the shop with my wife Anju. We sell food and basic household items. But business is slow now. People can't afford to buy much with the increased prices. We have a profit margin of around 3%. If we charged more money, we wouldn't sell anything. I don't want to lose my customers.

And, signs of more people being pushed below the poverty line by rising food prices:

...Its costs about 300 rupees ($5) to put a basic meal together for the family. And that's the same amount we earned working in shop all day. The worrying thing is that prices are increasing daily. I don't know how we'll manage if this trend continues. Maybe we won't be able to stay in the city. At least in the village we could grow our own food. But prices are high there too now.

Again, similar stuff:

A gardener living in the capital Kathmandu, Rajendra Bahadur Bista, 30, earns 5,000 Nepalese rupees a month (about £36). He spends 3,000 rupees from that to feed himself, his wife and two daughters, aged eight years and six months respectively.

"We eat less rice now, less bread and fewer vegetables," he tells me. "We had to cut back on other things, too, such as clothes."