New Issue

New Issue: Credit Cruch + Exchange Rate Policy + Global Imbalances + Girls Labour + Vital Signs

* The Most Recent Global Financial Crisis. From market turmoil to credit crunch
Almost exactly ten years after the Asian crisis, the world is again confronted with a veritable financial crisis. This time the harbingers arise on the other side – the USA rather than East Asia. Whereas ten years ago a real estate bubble in Thailand burst, triggering the flight of international speculative capital, today it is the fallout of the real estate crisis in the USA which threatens the financial markets. By Rainer Falk
>>> more

Also in WDEV Issue 5/Sep-Oct 2007:

* Child Labour: New ILO Study on Girls in Mining. Out of sight
A new study of the International Labour Organisation (ILO) shows that not only are children still being forced to work in mines, but many of them are girls. It is child labour in its worst form: Young girls risk permanent injury from carrying heavy loads of rock and contamination from nerve-damaging mercury. Without a chance to go to school, they are locked into a life of poverty. WDEV presents the report.
>>> more

* Vital Signs: World Record Levels of Consumption. EU should raise pressure on US

* What the G5 Expects from Dialogue with the G8: Joint position paper for the Heiligendamm Process

* TDR 2007: New Global Exchange Rate Arrangements Needed

The European Civil Society Round-Up

* Latests posts in WDEV's news blog:
+ Oxfam: Six million more teachers, doctors and nurses needed
+ EU appeal at WTO Panel seeks wo weaken Brazil's green laws
+ Controversial mining projects: Weaknesses of IFC standards
>>> more (free content)

Take your tour:

* Take a Tour on WDEV's Website: One week free

WDEV Summer Special: Valid only 4 days more

* +++ Subscribe now, and we charge you only as of October 2007 +++
Get access (by username and password) to 6 regular issues per year, to all our special reports and to all additional website articles for only € 25.00 or € 50.00!
>>> more

7:12 AM - 0 Comments - 0 Kudos - Add Comment

WDEV Issue 2/Mar-Apr 2007

Now Available: Entire Issue 2/Mar-Apr 2007 of World Economy & Development In Brief

* Financing for Development: From Monterrey to Doha. Towards the 2d World Conference on FfD
Currently Doha, the capital of the Arab Emirate Qatar, stands for the latest WTO round. This may soon change: In 2008, the United Nations will hold their 2nd Global Conference on Financing for Development (FfD) in Doha. This conference is intended to take stock of the outcomes of the resolutions of the first FfD conference in Monterrey in 2002 and to determine what new initiatives are necessary, esp. to attain the millennium development goals. Jens Martens summarises the most recent trends, possible issues and official preparations.
>>> more

Further contents:
* North Falls Short of Development Aid Promises: New DAC report gives serious warnings (WDEV summary)
* Development Assistance à la Chávez: Motives and forms of Venezuela's foreign aid (by Bodo Ellmers)
* Before the Bretton Woods Spring Meetings: A Double Majority for the IMF. Governance reform at the IFIs (by Peter Chowla, Jeffrey Oatham and Claire Wren)
* New Patterns of Mobility for India Needed: The limits of a state-sponsored car boom (WDEV highlight)
* The European Civil Society Round-Up: WDEV's Newsblog Mar-Apr 2007
* WDEV New Online Resources

Also at wdev.eu:

* WDEV Speciall Report: Democracy in the Light of Globalisation (by Bernd Hamm)
This essay explores ways in which democracy must be reformed in order to meet the new requirements posed by globalisation. It argues that the main problem is not how to conceive a blueprint of a global democratically structured government, and define its tasks. The main problem is rather to find out how we could come from here to there. To come closer to an answer, the paper analyses who or what it is what blocks the road towards global democracy, and why. In concluding, it shall mention some new developments which possibly allow to open a new window of opportunity. European governments will have an especially important part to play here, together with civil society.
>>> more

* Take a Tour on WDEV's Website: One week free

and

* Subscribe to World Economy & Developoment In Brief (WDEV)
Get access (by username and password) to 6 regular issues per year, to all our special reports and to all additional website articles for only € 25.00 or € 50.00!
>>> more

You receive this e-mail since you are currently on our mailing list. To unsubscribe please click send an e-mail to Webmaster.

World Economy & Development In Brief
Editor: Rainer Falk
98, avenue du X Septembre
L-2550 Luxembourg
Phone +352/26440990
Fax +352/26441009
Mobile +352/621/249485
E-mail: info@wdev.eu
Website: www.wdev.eu

3:13 AM - 0 Comments - 0 Kudos - Add Comment

New WDEV Special Report

..> ..>

New Special Report: Democracy and Globalisation

By BERND HAMM

This essay explores ways in which democracy must be reformed in order to meet the new requirements posed by globalisation. I will argue that the main problem is not how to conceive a blueprint of a global democratically structured government, and define its tasks. The main problem is rather to find out how we could come from here to there. To come closer to an answer, the chapter analyses who or what it is what blocks the road towards global democracy, and why. In concluding, it shall mention some new developments which possibly allow to open a new window of opportunity. European governments will have an especially important part to play here, together with civil society.

This Report, Democracy in the Light of Globalisation (WDEV Special Report, 2/2007) is reserved for subscribers with username and password. To read the Report please log in >>> here or pick your subscription >>> here. To order the Report separately by e-mail (as pdf file by e-mail) click >>> here.

6:29 AM - 0 Comments - 0 Kudos - Add Comment

Retreat or a New Wave of Globalisation?

Retreat or a New Wave of Globalisation? The present world economic juncture

Whereas the prominent globalisation critic Walden Bello already sees the "retreat of globalisation" – 15 years after its advent –, the World Bank in its most recent report, Global Economic Prospects (see note), believes that a new globalisation wave is about to hit and the decisive issue is how to manage the globalisation of the next 25 years. Yet the protagonists, notes Rainer Falk, have more in common than generally assumed.

On the surface, their positions could scarcely diverge more. However the contradiction weakens when one considers that proponents and critics each use different concepts of globalisation. The anti-globalisers usually identify globalisation as "neoliberal globalisation" or a new, more internationalised phase of capitalist development whereas the others mean increasing cross-border economic integration facilitated by both accelerating international flows of trade and investment and the rapid development of so-called new technologies. Whereas there are – without any doubt – indicators of a crisis of "neoliberal globalisation" (for example the recent retreat of many countries from the IMF), there is no indication whatsoever of a substantial slowdown or decline in global economic integration – quite the contrary.

In the short-term we will witness – even in a historical perspective – above average global economic expansion with growth rates in the South being twice as high as in the North and output growth again being exceeded by the increase in international trade and investment (>>> World Economic Perspectives in 2007). The picture is somewhat dulled by the frequently cited global imbalances (double deficits in the USA, primary commodities prices, etc.) which have not yet become an open crisis even if everyone says that they cannot be maintained indefinitely. Also according to the new UN report, World Economic Situation and Prospects (see note), there is a real risk of chaotic adjustment even if that does not necessarily mean that the US economy slides into recession.

However, the UN authors – like others – forecast a slight slowdown of the global economy in 2007 – caused above all by a decline in the US as a result of cooling off in the real estate market (down to 2.2% growth) and weaker growth in Europe (approx. 2%) which had risen more than generally expected in 2006. The augurs also prophesy continued robust expansion in the South for 2007 (approx. 6%) with peaks in East Asia (7.6%), China (10%) and South Asia (7%). Even the taillights of the world economy, the LCDs, are currently growing at an average of about 7%.

It is much more difficult of course to prepare long-term scenarios. Hence the World Bank's main thesis that world economic growth will be higher between 2006 and 2030 than it was between 1980 and 2005 almost automatically provokes criticism, especially as it predicts a 3.1% annual rise in per capita income in the developing countries – despite population growth. Rising incomes, the World Bank says, would lead to halving of absolute poverty (from 1.1 billion to 550 million people with income below US$ 1 per day) and shape the formation of a global middle class with approximately 1.2 billion people by 2030 in the Third World alone.

In this scenario, globalisation is driven by the new economic powerhouses in the South and above all by a new dynamic in trade in services whereby unanticipated technological advances could even further accelerate the process. As far as the scenario's susceptibility to crisis is concerned, the Bank can point to the fact that over the past 25 years the long-term globalisation trend was not stopped, not even by periodic interruptions, whether by recessions or more dramatic events such as the debt crisis, the demise of the Soviet Union or the tragedy of 11 September 2001.

Despite the optimism, the World Bank does not lose sight of all the risk factors that could intervene. According to the Bank, three factors place globalisation under permanent stress: growing inequality in and among nations, rising tensions in the labour markets and increasing environmental pressure. Even the World Bank can no longer ignore these factors. Recently a new study by the UN WIDER institute shows rising global inequality: only 2% of the world's population own more than half of the world's wealth (see note). Inequality and more aggressive competition in the labour markets have sparked a new globalisation debate among the world's leading economists. Moreover, since former World Bank chief economist Nicholas Stern issued his report on climate change, also the international environmental policy debate has entered a new phase.

According to the World Bank, it is just because of these "stress factors" that careful management of the next globalisation phase is crucial. However what the Bank proposes here (more development aid, more trade liberalisation and new institutions to protect the Global Commons) is so vague and weak that one has to ask "why bother?". Much more specific and without ignoring the obstacles, the UN report favours the establishment of a new international mechanism for macroeconomic policy co-ordination. Nonetheless, even that would not be sufficient to "humanise globalisation" – an idea which is once again being discussed in many progressive circles.

For radical critics like Walden Bello, "globalisation with a human face" may be nothing but an illusory attempt to steer the "corporate-driven" globalisation in a "social democratic" direction. Yet it is worth noting that even Bello sees the major issue today as how to manage the retreat of neoliberal globalisation to avoid chaos and war as followed the first globalisation wave from 1815 until the outbreak of World War I. Of course, there are substantial doubts as to whether we are (again) at a comparable historic juncture. Yet it is worth noting that the misleading thesis of a desirable "de-globalisation" is no longer mentioned in this context. Could it be that after the retreat of neoliberal globalisation a new phase of globalisation will follow in which the main issue is to correct its worst errors?

* James B. Davies/Susanna Sandström/Anthony Shorrocks/Edward N. Wolff, The World Distribution of Wealth, 70 pp., WIDER: Helsinki, 5 December 2006.

* Walden Bello, Globalization in Retreat, in: Foreign Policy in Focus, Washington DC, 27 December 2006.

* UN DESA, World Economic Situations and Prospects 2007, 177 pp., United Nations: New York 2007.

* World Bank, Global Economic Prospects 2007: Managing the Next Wave of Globalization, ca. 180 pp., The World Bank: Washington DC 2006.

Rainer Falk is the publisher of World Economy & Development (WDEV).

Posted: 22 Jan 2007

Recommended citation: Falk, Rainer (2007), 'Retreat or a New Wave of Globalisation?', World Economy & Development In Brief, Issue 1/Jan-Feb (www.wdev.eu)

12:55 AM - 0 Comments - 0 Kudos - Add Comment

WDEV Issue 1/Jan-Feb 2007 and WDEV Special Report 1/2007

Current Issue 1/Jan-Feb 2007: G8 theme Intellectual Property Rights

* Intellectual Property High on the G-8 Agenda: The wrong focus in Heiligendamm
Intellectual property rights are supposed to play a crucial role at the coming G-8 summit in Heiligendamm. The subject itself is politically highly explosive. The German federal government's G-8 agenda leans heavily toward the short-term interests of knowledge owners (= industrialised countries). Thus it contradicts its own claim to assume "responsibility for the political, economic and social shaping of globalisation", writes Klaus Liebig.
>>> more

* Retreat or a New Wave of Globalisation? The present world economic juncture
Whereas the prominent globalisation critic Walden Bello already sees the "retreat of globalisation" – 15 years after its advent –, the World Bank in its most recent report, Global Economic Prospects (see note), believes that a new globalisation wave is about to hit and the decisive issue is how to manage the globalisation of the next 25 years. Yet the protagonists, notes Rainer Falk, have more in common than generally assumed.
>>> more

* Foreign Direct Investment Trends: Record increase to be followed by slowdown
Global foreign direct investment (FDI) inflows grew in 2006 for the third consecutive year to reach US$1.2 trillion, according to UNCTAD's first estimate for the year. The total is a 34 per cent increase from 2005, although still short of the record of US$1.4 trillion set in 2000. The continued rise in FDI largely reflects high economic growth and strong economic performance in many parts of the world. Such growth has occurred in both developed and developing countries. Michael Monks reviews the latest figures.
>>> more

* WDEV Special Report 1/2007: Climate Change and Human Rights (by Wolfgang Sachs)
Climate change is far from being just an ecological issue; it is also an issue of equity. Equity within a generation has at least two dimensions. First, it implies the fair distribution of burdens and benefits of fossil fuel use among nations. Secondly, however, it also implies the universal protection of human dignity by securing the fundamental rights of every human person to water, food, housing, and health. In WDEV's new Special Report (1/2007) Wolfgang Sachs focuses on the latter dimension; the author explores the links between human rights and climate change, without, however, losing sight of the broader framework of equity in climate politics
>>> more

>>> Background Papers: Multistakeholder Partnerships - Future Models of Multilateralism? (by Jens Martens)

>>> WDEV News Portal: Updated continuously!

>>> WDEV Links of the Week: Zombie Economics (Th. Palley) + Alternative Finances: Rediscover Keynes (S. George) + Decent Work: How to realize? (Guy Ryder)

* Start the Year with Subscribing to WDEV! Two month for free for new subscribers

>>> more

You receive this e-mail since you are currently on our mailing list. To unsubscribe please click send an e-mail to Webmaster.

World Economy & Development In Brief
Editor: Rainer Falk
98, avenue du X Septembre
L-2550 Luxembourg
Phone +352/26440990
Fax +352/26441009
Mobile +352/621/249485
E-mail: info@wdev.eu
Website: www.wdev.eu

3:39 AM - 0 Comments - 0 Kudos - Add Comment

Mission of the site
Category: MySpace

The WDEV Experiment at MySpace

Surprised to find me here? It's an experiment. To find out if it's possible to engage young people through MySpace. Why not? Just get a friend of WDEV and post your comment!

Find out more on World Economy & Development (WDEV) In Brief >>> here.

11:56 PM - 0 Comments - 0 Kudos - Add Comment

Towards Heiligendamm

The German G-8 Agenda: Responsible, reliable, sustainable?

At the G-8 summit in Heiligendamm, Germany, to be held from 6-8 June 2007, the German government intends to focus on "shaping globalisation and helping Africa to develop". At such a level of generality one can only agree. Yet the debate begins with the "How?" On this point the approach of the German G-8 agenda proves to be deeply flawed. And: the agenda does not even mention the long overdue reform of the summit architecture itself, writes Rainer Falk.

Many non-governmental organisations have welcomed the agenda that the German government wants to deliberate at next year's G-8 summit. There was obviously great relief that rumours about the marginalisation of the issues of poverty and Africa in favour of an agenda centred around issues of Northern interest have not been manifested. There were only rare expressions of "mixed feelings" (VENRO) regarding the German government's plans for Heiligendamm.

In fact, the German G8 agenda is anything but grounds for jubilation. Instead of returning to the macro-economic coordination functions of the summit, Berlin will now give economic and development policy (i.e. Africa) the same formal priority. However, the specific design of both agenda points is such that one has to ask whose problems are to be solved here.

* Global imbalances

In the economic policy agenda for example, deliberations on "strategies aimed at reducing global imbalances" are planned. The government's agenda mentions the US balance of payments deficit, the weak domestic demand in Europe and Japan and the large currency reserves in Asia. The surpluses in China and other East Asian countries, however, are not only logic consequences of the Asia crisis a decade ago but are also - given the continuing deficiencies of the international financial system - the only way to prevent further such crises. The much more serious and structural surplus problem of the world economy lies in Europe and Japan. In Europe, Germany has been producing chronically export surpluses for decades. It is exactly this structural trade surplus that has to be discussed if there is to be a serious reduction of imbalances. But the host country obviously has no interest to do this.

Instead the German government wants the G-8 to issue a "commitment to freedom of investment in industrialised countries and emerging countries". Although investment conditions and the "social dimension of globalisation" - such as global obligations undertaken by transnational corporations to maintain adequate social standards? - will be dealt with as well, we are not told how this will happen. Berlin is very specific only on the "protection of innovations against product and trademark piracy", where the interests between the old industrialised countries and the emerging economies directly collide.

The agenda items "transparency of financial and capital markets" and "energy efficiency and climate protection" certainly are points which NGOs could pick up. However as long as it remains entirely nebulous which initiatives the German government will introduce in Heiligendamm, this remains but a small consolation.

* Twisted Africa agenda

As the just released Human Development Index 2006 documents, the gap between the richest and poorest countries continues to widen, above all due to Africa's economies lagging behind. In view of this fact nobody would have understood if the issue had completely disappeared from the agenda. However, the development, resp. Africa approach of the German G-8 presidency illustrates how one can create the impression to continue the ambitious agenda of Gleneagles in 2005 while in fact setting something quite different in motion. According to the German chancellor Angela Merkel the G-8 relationship to Africa should develop into a "reform partnership". But a closer look reveals the following: "The African states need to develop structures that encourage private investment".

There is nothing to be said against such an approach—it is a fact that in many places in Africa conditions predominate which hinder private investment. However, the question is whether, given the continent's problems, this constitutes an appropriate priority. Fact is the German agenda for Heiligendamm clearly cannot be considered as a follow-up to Gleneagles. Obviously there is no intention of reviewing in detail the implementation of the G-8 promises on aid, debt relief and trade. The only issue that possibly relates to the Millennium +5 year 2005 is the significance that the fight against HIV/AIDS has meanwhile attained for all and hence also for the G-8.

Particularly for the German government it would make sense to critically review the Gleneagles commitments – as is clearly illustrated by a new report on the "Reality of Aid" just published by Deutsche Welthungerhilfe and terre des hommes. According to the report last year's enormous increase in German development aid was only on paper. Without debt cancellation for Iraq, Nigeria and other countries, even less money went to developing countries in 2005 than in the previous year. Deutsche Welthungerhilfe and terre des hommes therefore demand that the German government prepare an "Initiative 07.07.07" with a view toward to the Millennium Goals mid-term in July 2007 to ensure the increase of development aid to 0.7% of GNI by 2015. Yet the planning to date for Heiligendamm shows that the summit will be far from a milestone on the way to this goal.

* No G8 reform

The most pathetic chapter of the German G-8 agenda is clearly that it entirely fails to tackle the challenge of reforming the arcane summit architecture itself. The German government wants to conduct an "intensive dialogue with emerging countries" (about what?). It wants to invite to the summit five so-called outreach countries, namely China, India, Brazil, Mexico and South Africa. However, it intends neither to open the G-8 structure nor considers to replace it by a more representative body for the world economy. Instead the –G-8 as a "community of values" and its "functionality as a group" are to be maintained. Does that mean openness is being replaced by laager mentality? But why? To prepare for the "World War for Wealth" as a new bestselling book of Gabor Steingart (Der Spiegel) titles? The problem of the political approach chosen by Berlin for the G-8, however, is that the perceived "functionality of the group" has long since been a thing of the past.

To summarise: Does the German Presidency agenda signal responsibility, reliability and sustainability as the government would have us believe? The answer is simple and sobering. In the fight against global economic imbalances, Berlin simply avoids its own responsibility. Considering the South's expectations from the industrialised countries, the world champion of exports is not exactly a paragon of reliability. The only "sustainable" aspect of the German G-8 agenda is the fact that it is directed to maintaining the tradition of an exclusive club which in reality has long superseded.

Rainer Falk, Luxembourg, is the publisher of World Economy & Development In Brief.

Recommended citation: Falk, Rainer (2006), 'Towards Heiligendamm: The German G-8 Agenda. Responsible, reliable, sustainable?', World Economy and Development In Brief, Issue 4/Oct-Nov

..>..>..> ..>

..>..>..>..>..>..>

More on the subject: >>> Special feature: Towards Heiligendamm

4:43 PM - 0 Comments - 0 Kudos - Add Comment