Gmail - Development Gateway FDI Topic Page: Newsletter No. 12China and India rival one another and are aggressively challenging the United States as the world's most favored destination for FDI, according to the latest Foreign Direct Investment Confidence Index, an annual survey of executives from the world's largest companies conducted by global management consulting firm A.T. Kearney. For the third year in a row, the United States lagged China as the second most attractive investment destination in the world, and now India is not far behind. For the first time in the Index, India displaced the United States, now in third place, to become the second most attractive FDI location among manufacturing investors.

Telegraph | News | US megachurches bring shopping mall theology to thirtysomethings: "The number of megachurches in the country has risen from 20 to 740 in 20 years and newly released figures showed that their congregations went up four per cent last year, the fastest of any kind of church in the US. But what their events lack, and what makes them controversial among America's traditionalist Christians, is a clearly defined doctrine."

Telegraph | News | US megachurches bring shopping mall theology to thirtysomethings: "This is the United States' latest religious phenomenon. As Americans like going to shopping malls for all their consumer needs in one spot, so self-styled 'megachurches' are the fastest growing form of service in the country.
They offer a one-stop spiritual supermarket. At the Saddleback Church in Lake Forest just outside Los Angeles County, the second biggest church in the country with 20,000 worshippers each weekend, there are not only four main Sunday services but 18 small ones."

Cable TV Study - Violence, sex and profanity on cable - Wired For Raunch: "Overall, sexual content averaged 3.6 instances per hour. The fall '99 broadcast rate also was 3.6. "

Cable TV Study - Violence, sex and profanity on cable - Wired For Raunch: "The overall combined per-hour rate of sexual references, use of coarse language, and instances of violence was 21.7. The combined average found in the PTC's last study of prime time on the broadcast networks, which examined fall '99 programming, was 9.8. "

Asia Times - Asia's most trusted news source: "The population of the Arab world doubled during the 20 years between 1978 and 1998, and between 1998 and 2010 will have grown by yet another third. [6] "

Asia Times - Asia's most trusted news source: "Like everything in the Greater America of globalization, you have turned religion into a consumer goods. Americans choose among 139 major brands of Christianity. Your old churches close for lack of worshippers, and you build new churches in shopping malls where religion is sold along with sausages."

WIDER Publications there is much less consensus on whether utilities—power,water, transport infrastructure—should be in private or public ownership, although the fiscal crises of developing countries have nonetheless driven many governments to privatize their state utilities. Finally, countries are now keener to attract private capital flows, in part because of the decline in official flows, however private flows remain concentrated on a relatively narrow range of countries (China in particular).
DP2004/09 Tony Addison: Development Policy: An Introduction for Students (PDF 151KB)
http://www.wider.unu.edu/publications/dps/dps2004/dp2004-009.pdf

WIDER Publications Reform may be opposed because it has large social costs, or because the losers from reform often have more incentive, and find it easier to organize themselves politically, than winners from reform.

The Observer | Comment | The coming war: "Richard Clark, Bush's former anti-terrorism coordinator who took charge in the White House on 9/11 and who retains close contact with intelligence agencies around the world, tells me that 'by almost any measure... the war on terrorism is being lost'. He cites the rate of terrorist atrocities, more than doubled since 9/11, and insists that the number of terrorists has risen to around 100,000 active 'jihadists' around the world. Chillingly, he believes these zealots are likely to be supported 'philosophically, politically, and perhaps with money' by upwards of 700 million Muslims - roughly half the global population of the Islamic faithful."

People's Daily Online -- China's reliance on imported oil grows: "China imported 76 million tons of crude oil in the first eight months of this year, making up 40 percent of the total domestic demand, a six percent rise over 2003.
China's year end oil import volume is expected to hit 100 million tons in 2004, and the country's demand for petroleum may exceed 400 million tons in 2020. But only approximately 160 million to 170 million tons of that amount can be produced in a year in China. "

WIDER PublicationsKey points:
• Getting trade policy right is crucial for economic development, and the merits of using import protection and other trade policy interventions are hotly debated.
• Import protection can stimulate investment in infant industries, but it can also reduce growth by distorting economic incentives and encouraging rent-seeking.
• The failure of many countries to achieve growth through import protection has led to a new emphasis on outward-orientated development, but this too requires a well-designed strategy, particularly in creating new skills to sell in the global market-place.

WIDER Publications Nevertheless, in the early era of development (from the 1940s to the 1970s), many policymakers saw the domestic market as the main motor for growth; in other words, inward-orientated development was favoured over outward-orientated development.

WIDER Publications However, in the latter 1990s a reaction against market liberalization and privatization set in, and the intellectual pendulum began to swing back towards the state, owing to sharp increases in inequality, rising concern over liberalization’s social effects, and the mismanagement of privatization. This was bound up in the intense debate about globalization (see Nayyar 2002). Economists increasingly recognized the importance of institutions in making the market mechanism work well for development and poverty reduction.

WIDER Publications The key elements of the Washington Consensus
are: fiscal discipline, reorientation of public expenditures, tax reform, financial liberalization, competitive exchange rates, trade liberalization, openness to foreign direct investment (FDI), privatization, deregulation, and secure property rights.

WIDER Publications Much of the debate on development strategy can be reduced to differences in views about how far market mechanisms (the operation of supply and demand) yield socially-desirable outcomes and therefore the virtue or otherwise of state action (where the definition of ‘socially desirable’ is also contested).....
People who are pessimistic about the market mechanism’s ability to deliver any or all of their chosen set of socially-desirable outcomes will favour a more active state, but their conceptualization of what the state should do can show a very wide range. At one extreme is central planning (practiced by the former Soviet Union) where society’s productive factors are allocated according to a plan without reference to market prices, and where state ownership of enterprises and property prevails. At the other end of the scale of the active state, there is the ‘European model’ where continental European states provide very high levels of public goods, regulate the market in the public interest, but otherwise encourage a very vigorous private sector.

WIDER Publications Economic growth can occur in many ways; population growth adds to the stock of workers and, provided that they are productive, to output; labour productivity rises through the accumulation of capital equipment together with technical progress.

WIDER Publications But when it comes to spending public money, basic pro-poor services—especially those that serve the rural poor—are often at the bottom of the list, after services that meet the needs of more vocal, and more effectively organized, non-poor groups (especially in urban political centres). A general bias against the rural areas and in favour of the urban areas (urban bias) was evident in much of post-independence Africa. Vocal and wealthy interests may effectively control the legislatures that determine the pattern of public spending and taxation (Central America is an example). And when economic crisis strikes, governments have too often let the burden of adjustment fall on the meagre services that are of benefit to the poor.

WIDER Publications Looking at economic growth (the rate of growth in gross domestic product (GDP) often presented on a per capita basis), Sub-Saharan Africa has performed very badly for much of the period since 1980 (with the notable exceptions of Botswana and Mauritius) and many African countries today have a level of per capita GDP below that of 1980: GDP per capita is below the level of the 1960s in countries that have experienced civil war (for example, Angola, the Democratic Republic of the Congo, and Liberia). At the other extreme, the growth of some East Asian countries has been at rates which are historically unprecedented. Whereas it took the United Kingdom—the world’s first industrial nation—54 years to develop from a low per-capita income economy to a middle-income economy, it took Hong Kong, Singapore and Taiwan only 10 years to achieve middle-income status (estimates from Parente and Prescott 2000). China is presently growing at over 9 per cent a year....the Middle East and North African countries raised their standard of living using their oil wealth, but have largely failed to achieve economic diversification and provide employment for their growing and young populations, while dictatorship and war have driven countries such as Iraq back down into the low-income country group.
In summary, the developing world today presents a very mixed picture: very fast growth and poverty reduction in much of Asia; slow or negative per capita GDP growth in SSA combined with rising poverty; high volatility in Latin America’s economic performance; and widespread stagnation in North Africa and the Middle East, despite often abundant natural resources.

WIDER Publications The paper then discusses how to achieve economic growth, starting with the caveat that growth must be environmentally sustainable, and moves on to the big question of the respective roles for the market mechanism and the state in allocating society’s productive resources.

"Visual summary of disasters in the past decade (International Red Cross, World Disaster Report 2004) :
Description:This graphic provides a a visual summary of disasters in the past decade. URL:http://www.alertnet.org/thefacts/imagerepository/disastersgraphic750.jpg

Red Cross Red Crescent - World Disasters Report 2004 - Chapter 1: "In the last two decades, 'resilience' has become the buzzword to describe the capacity to survive, adapt and bounce back from crisis. "

Red Cross Red Crescent - World Disasters Report 2004 - Chapter 8: "The reason less people are dying from hydro-meteorological disasters, in particular, may be partly explained by better satellite forecasting and early warning systems. Equally, systematic disaster preparedness at community level has helped reduce death tolls. The fact that more people are being affected by disasters reflects a combination of factors: rising numbers of reported disasters; rapid population increase in poorer parts of the world; and rapid, unplanned development (particularly in urban areas). "

Red Cross Red Crescent - World Disasters Report 2004 - Chapter 8: "Despite the increased number of disasters, average annual death tolls have dropped from over 75,000 per year (1994 to 1998) to 59,000 per year (1999 to 2003). However, over the same period, the numbers affected continued to climb. For the first five years of the decade, an average of 213 million people were affected. The second half of the decade saw this figure rise by over 40 per cent to an average of 303 million per year. "

Red Cross Red Crescent - World Disasters Report 2004 - Chapter 8: "Both hydro-meteorological and geophysical disasters have become more common, becoming respectively 68 per cent and 62 per cent more frequent over the decade. This reflects longer-term trends. However, weather-related disasters still outnumber geophysical disasters by nine to one over the past decade. Among natural disasters, floods are the most reported events in Africa, Asia and Europe, while windstorms are most frequent in the Americas and Oceania. "

Red Cross Red Crescent - World Disasters Report 2004 - Chapter 8: "Over the past decade, the number of 'natural' and technological disasters has risen. From 1994 to 1998, reported disasters averaged 428 per year - from 1999 to 2003, this figure shot up by two-thirds to an average 707 disasters each year. The biggest rise was in countries of low human development, which suffered an increase of 142 per cent. Transport accidents registered the biggest rise, climbing 75 per cent during the second half of the decade. However, our tables only account for accidents where at least 10 people were killed or 100 affected by a single incident."

TFF Features US Empire - future & end: "'A country's violence, Hannah Arendt said, can destroy its power. The United States is moving quickly down this path. Do American leaders imagine that the people of the world, having overthrown the territorial empires of the nineteenth and twentieth centuries, are ready to bend the knee to an American overlord in the twenty-frist? Do they imagine that allies are willing to become subordinates? Have they forgotten that people hate to be dominated by force? History of packed with surprises. The leaders of the totalitarian Soviet empire miraculously had the good sense to yield up their power without unleashing the tremendous violence that was at their fingertips. Could it be the destiny of the American republic, unable to resist the allure of an imperial delusion, to flare out in a blaze of pointless mass destruction?'"

The Power and Interest News Report (PINR): "global trend toward multipolarity, with each major power consolidating its interests within its region of influence...For example, in a multipolar world, China would attempt to increase its power in Asia, upping its rhetoric on Taiwan, gaining more influence in the South China Sea, and supporting pro-Beijing regimes in countries like Myanmar. Geopolitical concerns would push Japan and South Korea toward remilitarization. India could make a move on Pakistan. Russian encroachment on the Caucasus and Central Asia would result. Iran would continue its pursuit of regional power and nuclear weapons -- with Russian assistance -- and North Korea could be expected to sustain its belligerency in the face of the United States and its allies. "

Self-determination goals Of the 161 groups that had self-determination goals in 1998-2000, only one-quarter (41) were engaged in armed conflicts in 1998-2000, usually in the form of guerrilla wars like those being fought by Chechens in Russia, Tamils in Sri Lanka, and southerners in Sudan.

Self-determination We also have documented another seventy-six territorially concentrated groups that currently support significant movements seeking greater self-determination by political means.

Self-determination conflicts Twenty-two armed self-determination conflicts are ongoing as of the beginning of 2003.

Independence Seventy territorially concentrated ethnic groups have waged armed conflicts for autonomy or independence at some time since the 1950 s not counting the peoples of former European colonies.

Bad neighborhoodsThe idea and evidence for our indicator of “bad neighborhoods” is that a conflict-ridden country exports refugees, armed conflict, and insecurity to surrounding countries.

Polarization of forces The US, as the world’s preeminent power and most prominent promoter of globalization, and as the defender of the status quo, has become a favorite target for the militants. This high profile confrontation has contributed strongly to the polarization of forces and the development of a “siege mentality” in both “camps” as many believe their most personal, core, values to be under assault by the “other.” In many locations around the globe there is evidence of strong and persistent tensions between Muslim and non-Muslim populations, whether in Sudan, Nigeria, Ivory Coast, Bosnia, the Caucasus, South Asia, Indonesia, or the Philippines.

The emerging global system remains highly vulnerable to sudden shocks; a seemingly small or isolated crisis in one part of the world could have devastating repercussions that spread quickly and reverberate throughout the system.

Resistance to globalization and US hegemony are emerging threats to peace. The
escalating international campaign of protests against multinational economic institutions is the subject of a special feature of this Report. Al Qaeda exemplifies opposition to American hegemony in its most violent and uncompromising form.

Survival of new democracies Armed conflict and lack of development both are inimical to the survival of new democracies. By comparison with their historical predecessors, many “third wave democracies” of the last few decades should have died in infancy. Their survival depends on international support and if that support is diverted, the risks are high that a number of new democracies will falter in the next few years.

Global magnitude of armed conflict Progress and resistance have always been part and parcel of world politics. Whether the global trends toward greater peace and democracy continue or reverse depends on decisions by international policy makers that determine whether and how specific challenges are met. A number of very positive trends have continued during the last two years, as this report documents...The decline in the global magnitude of armed conflict has continued..

La marchandise: La marchandise a pris le pas sur l'esprit. Plus ça va et plus l'homme est plus petit que lui-même, comme l'écrivait Günther Anders. Tout notre mode de pensée s'est mis à tourner autour de la marchandise. Ce qui n'est pas très excitant, sauf bien sûr pour les marchands…

Collaborative learning networks For climate change and biodiversity loss, with planning horizons of 10–20 years, we need to develop collaborative learning networks enabling governments, multilaterals, NGOs, and private firms to develop common views of critical problems, and coordinated approaches to address them.

Global legitimacy What we do not have is a world executive committee that has global legitimacy, representing the interests of the vast majority, dealing with longer term strategic issues. Such a world body would have three main tasks: to think seriously about these internationally issues, to monitor what happens, and to crack the whip when progress is not forthcoming and selfish national or parochial interests threaten to delay progress for the common good.

World community Will we let this window of opportunity close without any real attempt to move toward more effective global governance? Taking those steps will require political commitment by world leaders—the G-8, of course, but increasingly the G-20 developing nations as well—if we are to create a true “world community.”

Geopolitics is once again beginning to affect aid allocation and delivery, as the global war on terror separates allies from less cooperative countries.

Geopolitical goals The end of the Cold War in the early 1990s
made donors more willing to focus on development goals, not just geopolitical goals, in the developing world.

Moving toward a global community Minimizing these risks requires moving toward a global community, not as people observing each other warily and enviously across borders, but as world “citizens” working together to improve the lot of the entire community. And moving toward a global community requires moving toward true global governance, with world leaders concerned about people everywhere, not just the residents in the wealthiest and most powerful countries. Not doing so is likely to breed insecurity, increasing what the rich, the less rich, and even the poor countries spend each day on defense rather than development and poverty reduction. It is also likely to cause retreats to nationalism or regionalism, when globalism should be the goal.

Environmental problems will become more acute, and the toll from HIV/AIDS will be huge in the medium run, in Africa and in other regions.
On current trends, it is reasonable to fear that aid from developed countries to the rest of the world will fall short of what is needed for rapid economic and social development.

Imbalances Even with progress on some of the global indicators, the imbalances between regions and countries will deepen.

Development assistance Projecting development assistance is risky, because it depends heavily on the geopolitical situation and the domestic political environments in donor and recipient countries.

Civil conflict Without much faster development in the poorest regions, civil conflict is likely to continue to be a major feature of the development landscape over the next quarter-century.

MDG poverty target Despite the global progress, Latin America and the Caribbean and Sub-Saharan Africa are projected to miss the MDG poverty target, Africa by a wide margin.By 2030 Latin America and the Caribbean will barely achieve its 2015 target, and Sub-Saharan Africa will still be off, though closing in.