Category Archives: Resource Based Economy

ByArvind Subramanian

Economic Survey 2017-18 presents four striking findings about urbanisation in the country and the challenges being faced by Indian cities. Magnitude of Indias urbanisation is not unusual but the pattern is: Contrary to perception, the level and evolution of the countrys urbanisation are similar to those of other countries.

Broadly, urbanisation has increased with per-capita GDP, so that the difference in the level of urbanisation between, say, India and China can be attributed mainly to the different levels of development (see Per-Capita GDP and Urbanisation).

However, Indias pattern of urbanisation seems unusual. One indicator is Zipf s law, which says that the city with the largest population in a country is generally twice the size of the next biggest, three times the size of the third biggest, and so on. But as Zipf s Law and India shows, Indias pattern does not conform to Zipfs law in two ways: smaller cities are too small and, seemingly, the largest cities are also too small.

The reasons for this could be manifold: overburdened infrastructure in Indian cities; distorted land markets leading to unaffordable market rents that, in turn, discourage migration; and strong place-based preferences embedded in the deep social networks in the country.

For example, better service delivery is positively correlated with capital expenditure and staffing (see Per-Capita Capital Expenditure & Services and Adequacy of Staff and Services). More resources seem to be associated with better outcomes. Resource mobilisation by ULBs, therefore, remains one of the key challenges.

ULBs like Mumbai and Pune, even with low scores on taxation powers, do very well in own revenue mobilisation, while ULBs like Kanpur and Dehradun, etc, even with relatively greater taxation powers, perform poorly in terms of own revenue generation. So, the constraint on resource mobilisation is not the law but effective performance even within the law.

Challenges to the property tax collection also include inaccurate enumeration and likely undervaluation. An analysis based on satellite imagery done for this years Economic Survey has shown that Bengaluru and Jaipur collect only 5-20% of their property tax potential. There is considerable scope for improvement.

Taking cognisance of the political economy challenge state governments reluctance to cede power and share more resources with ULBs, evoking Professor Raja Chelliahs famous comment that everyone prefers decentralisation but only up to his level perhaps finance commissions could consider allocating even more resources to urban local bodies.

However, this should be subject to meeting clear criteria on good governance, transparency and accountability. Municipalities must also make the most of their existing tax bases and use the latest satellite-based techniques to map urban properties to realise the untapped potential.

Just as states are competing with each other, so too must cities. Cities that are entrusted with responsibilities, empowered with resources and encumbered by accountability can become effective vehicles for competitive federalism and, indeed, competitive sub-federalism to be unleashed.

The writer is chief economic adviser. Co-authored with Shobeendra Akkayi, Parth Khare, Gopal Singh Negi, MRahul, Rabi Ranjan. The writers worked on this years Economic Survey

DISCLAIMER : Views expressed above are the author's own.

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Financially empowering urban local bodies, and holding them accountable - Economic Times (blog)

NEW DELHI: Reacting to a report citing India will need no coal-based power plant after 2025, the World Coal Association (WCA) said it is not credible to suggest that the country can achieve universal energy access and develop its economy without coal in the next 10 years, regardless of the country's investment in renewables.

WCA chief executive officer Benjamin Sporton said, "India's energy needs are too huge for any suggestion that it will not need coal in the future. In a country where 244 million have no electricity and 819 no access to clean cooking facilities, it is impossible to find a solution without coal being part of the energy mix- Coal is essential to global efforts to achieving universal energy access. "

The Energy and Resource Institute (TERI) on Monday said that excess power generation capacity provides India an opportunity to shift completely to green energy. The study by TERI said if the country can halve storage technology prices by 2024 it can do without the need for new coal-based plants. TERI report is partially in line with a recent report by the Central Electricity Authority that said the country does not need new coal based power generation capacity till 2022.

WCA said for a country like India, it's not a choice between coal and renewables - both are needed and both will play a big role. Renewables have an important role to play but coal will remain the driving force behind electrification and industrialisation and according to the International Energy Agency (IEA), coal will continue to make the largest contribution to electricity generation in India through to 2040.

WCA said although the competitiveness of renewables and gas-fired technology in India is likely to improve over time, coal is expected to remain the most affordable option through to 2035.

Given India is exploring emerging technology such as battery storage we would encourage them to also support CCS. In India there is an unsubsidised, fully commercial CCUS facility which has been operating since 2015. This CCUS project from Carbon Clean Solutions in the port of Tuticorin has been able to significantly reduce the costs associated with capturing the CO2.

"There is an assumption that we can get rid of coal, and only by doing so can we meet climate objectives. This is false. Coal plays a critical role in the world's energy mix and is going to do so for a very long time to come, especially for a country like India where the need for stable, reliable and affordable energy has never been greater," Sporton said.

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India can't write-off coal-based energy so soon: World Coal Association - Economic Times

As a former member of Maines Consensus Economic Forecasting Commission, I have learned to remain humbly silent about any prognostications I may have made. Nonetheless, I find it gratifying that just a week after saying that we would do well to pay more attention to principles than to partisanship, the headlines proclaim that we are at least so far still a nation with an independent judiciary based on the principle of a constitutional separation of powers. However the issues of executive power and immigration reform may ultimately be resolved in the case of temporary bans, it is clear that we all need to be involved in formulation of whatever new social contract emerges from the constitutional turmoil in which we are now embroiled.

To my mind, the most important element such a contract must include is an expanded version of economic adjustment assistance. It is often forgotten that many of the central elements of the implicit social contract that emerged nationally in the New Deal of President Franklin Roosevelt in the 1930s Social Security, unemployment insurance, wage, hour and worker organization regulations were not created by our federal government, but borrowed from the most successful experiments conducted in a variety of state governments. And these programs were, in turn, the product of collaborations among social activists, labor unions, academic researchers and philanthropists.

Ultimately, these elements of the New Deal social contract were based on an evolving understanding of certain of our foundational goals. Individual liberty and equality before the law could, in the industrialized world of the 1930s, have practical meaning only within a community that created programs that at least tried to ensure some degree of equality of opportunity to all citizens. Hence, a tax on wages that went into a fund to ensure that those who had worked for years could enjoy some level of financial support for their last, non-working, years. Hence, another tax on those working today to go into a fund to help those who may lose their jobs tomorrow.

The traditional New Deal economic adjustment assistance programs worked well into the 1980s, but they are clearly inadequate to the demands of the post-1980s globalized economy. And just as the programs of the 1930s emerged to address the socio-economic changes from the agriculture-based economy of the 19th century, so programs today must recognize and adapt to the globalized and digitized economy of the 21st.

Through the better part of the 20th century, unemployment insurance was relatively effective in buffering the worst of the business cycles. When business declined and workers were laid off, funds collected when they were working could be used to tide them over until business improved and they were called back. Since the 1980s, fewer and fewer workers were ever called back. Each recession served as motivation for businesses to become more productive to produce more with fewer workers.

What the unemployed need today in addition to pure wage replacement is the three Rs: re-engagement, retraining and relocation assistance. To anyone following the labor market closely, it is obvious that skilled and motivated human beings are increasingly the scarcest and most valuable resource on earth. Designing and implementing the programs to meet this need will be the battleground from which some political party will become the majority party for the next generation. Will it be the Democrats? The Republicans? The Greens? The nationalists? Who knows, but if someone doesnt, the United States experiment in democracy will certainly fail.

In the interests of focusing discussion, heres a proposal: Reduce the federal corporate income tax rate from 35 percent to 20 percent. Create a federal-state worker learning assistance program modeled after the federal-state unemployment assistance program. Dedicate all federal and, where applicable, state corporate income tax revenue collected to this newly created worker learning assistance program. Include in this dedication all corporate income tax collected on repatriation of any of the estimated $2.4 trillion of corporate income held abroad by U.S. corporations on earnings they made outside the U.S. Include an additional 5 percent credit on earnings repatriated within six months of enactment of this program. Establish a board comparable to the National Science Foundation to solicit, evaluate and allocate money to proposals for use of these funds from schools (public and private), universities, labor unions and any other entity with ideas for helping workers displaced by business disruptions caused by international trade or abrupt technological change.

Such a program would, I believe, do more to make real for the 21st century the fundamental American principle of equality of opportunity than any other public program we could design. It would simultaneously productively disrupt our glacially slow educational institutions, more fully exploit the opportunities presented by the digital communications revolution and begin to stem the alienation and hopelessness that feed the anger and addictions that so threaten our social fabric.

Charles Lawton, Ph.D., is a consulting economist. He can be contacted at:

[emailprotected]

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Charles Lawton: Here's a proposal to create real equality of job opportunity - Press Herald

(MENAFN - The Peninsula)

Tech giant Siemens, after delivering for more than four decades as a local company in Qatar, has quantified its contribution to society through business in a report titled In Qatar, for Qatar Making real what matters'.

The findings illustrate the company's commitment to the country in line with the Qatar National Vision 2030, as it seeks to support its transition into a diversified and sustainable economy. Siemens outlined its impact by focusing on key pillars in Qatar's plan for the future, including developing local skills, improving quality of life, supporting the drive for innovation and preserving the environment.

As a local company with almost 500 employees, Siemens in Qatar redistributes 60 percent of its profit to local shareholders. From a technology aspect, for example, Siemens contributes to transmitting and distributing more than 60 percent of the power generated in Qatar. It also facilitates electricity and water generation through one of the largest projects in the region that will help boost the country's electricity output by more than 23 percent and water supply by over 25 percent come 2018.

Siemens seeks to further strengthen its position as a digital company and achieve double-digit growth in software, digital services and cloud platforms every year through 2020. Its new MindSphere cloud platform will also be a growth driver, enabling the company for the first time to offer customers in sectors ranging from industry to rail operation a cloud-based, open operating system for the Internet of ings. It will also make it possible to develop and operate apps and digital services.

As Qatar enjoys a period of prosperity and economic progress, the company is supporting its sustainable development with a portfolio of digital solutions. Siemens enables safety and comfort in buildings for working and living environments across Qatar through its building technologies. More than 55,000 sensors and 1 million data points work in unison to ensure fire safety, building automation and security in Qatar.

Throughout the country, 200 buildings are equipped with the company's innovative solutions and advanced technologies.

'As an international company with a strong local presence, we understand the importance of operating in-line with the country's goals and ambitions. " "We have realised that entrepreneurship, innovation and best practice in technology will facilitate Qatar's transition from a resource-based economy to one with knowledge as its foundation. Siemens looks forward to further supporting these aspirations for a sustainable future, as they turn into reality, said Adrian Wood, CEO of Siemens in Qatar. To strengthen its power of innovation, Siemens is planning to increase its investments in research and development (R & D) globally in fiscal 2017 by some 300m to around 5bn. Since fiscal 2014, the company's R & D investments have grown by about 25 percent. A major part of these additional funds are earmarked for automation, digitalisation, decentralised energy systems and the new venturing unit next47.

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Siemens backs Qatar''s economic ambitions with innovation - MENAFN.COM

Do resource booms enhance growth in a country or lead to a crowding out of other tradable industries, such as manufacturing? Traditional theories suggest that crowding-out effects dominate. The idea is that gains from the boom largely accrue to the profitable sectors servicing the resource industry, while the rest of the country suffers adverse effects from increased wage costs, an appreciated exchange rate and a lack of competitiveness as a result of the boom.

In the research literature, such a phenomenon is commonly been referred to as Dutch disease, based on similar experiences in the Netherlands in the 1960s. But traditional studies of Dutch disease do not account for productivity spillovers between the booming resource sector and other non-resource sectors. We put forward a simple theory model that allows for such spillovers. We then quantify these spillovers empirically, allowing for measurement of both resource and spending effects through a large panel of variables.

Using mineral abundant Australia and petroleum rich Norway as representative cases studies, we find that a booming resource sector has positive effects on non-resource sectors, effects that have not been captured in previous analysis. The wider benefits for the economy are particularly evident when taking account of productivity spillovers and learning-by-doing between industries. The most positively affected sectors from a resource boom are construction and services. Yet, manufacturing also benefits, though less so than the other industries.

Augmenting traditional Dutch disease theories

Experience in resource-rich countries suggests that there may be important spillovers from the resource sectors to other industries. Norway is good example. As the development of offshore oil often demands complicated technical solutions, this could in itself generate positive knowledge externalities that benefit other sectors. And since these sectors trade with other industries in the economy, there may be learning by doing spillovers to the overall economy.

Traditional Dutch disease theories do not account for such spillovers. The model developed in this study does take account of them. We allow for direct productivity spillovers from the resource sector to both the traded and non-traded sector.

We further assume that there is learning-by-doing in the traded and non-traded sectors, as well as learning spillovers between these sectors. Hence, we extend the more traditional model of learning-by-doing with technology spillovers from the resource sector. To the extent that the natural resource sector crowds in productivity in the other sectors, the growth rate in the overall economy will also increase.

The positive effects of a resource boom

We test the predictions from our suggested theoretical model against data by estimating a dynamic factor model that includes separate activity factors for the resource and non-resource sectors in addition to global activity and the real commodity price.

This makes it possible to examine separately the windfall gains associated with resource booms (that is, volume changes) from commodity price changes, while also allowing global demand to affect commodity prices.

The main finding emphasises that there are large and positive spillovers from the exploration of natural resources to the non-resource industries in both Norway and Australia. In particular, in the wake of the resource boom, productivity, output and employment increase for a prolonged period of time in both countries, see Figure 1.

The expansion in Norway is substantial; after one to two years, 25-30per cent of the variation in non-resource GDP is explained by the resource boom, while the comparable numbers are 43-50 per cent for productivity. In Australia, the expansion is more modest: 10-15 per cent of value added in non-mining is explained by the resource boom, while 5-6 per cent of productivity is explained by the same shock.

Examining the different industries, we confirm that value added and employment increase in the non-traded sectors relative to the traded sectors, suggesting a two-speed transmission phase. This is in particular evident in Australia. The most positively affected sectors are construction and business services. Still, and in contrast to the predictions from the traditional Dutch disease theories, manufacturing also benefits from the resource boom, although less so than the other industries see Figure 2.

Notes:

Hilde C. Bjrnlandis Professor of Economics at BI Norwegian Business School and Director at the Center for Applied Macro-and Petroleum economics (CAMP). She is also scientific advisor atthe research department of Norges Bank and member of the Swedish Fiscal Policy Council. Her main research interests are applied macroeconomics and time series. Special interests include the study of natural resources, business cycles, andmonetary and fiscal policy. Dr.Bjrnland has published extensively in top international journals. She is also the co-author of the book: Applied Time Series For Macroeconomics. Email:hilde.c.bjornland@bi.no

Leif Anders Thorsrudis a Senior Researcher in Monetary Policy Research at Norges Bank and Researcher II at the BI Norwegian Business School and Center for Applied Macro and Petroleum Economics.He obtained his Ph.D. at the BI Norwegian Business School in 2014. Dr. Thorsruds research on forecasting and energy economics has been published in top field international journals. Currently his research agenda centres on how unstructured data sources can be used to understand macroeconomic fluctuations. He co-authored the book: Applied Time Series For Macroeconomics. Email: leif.a.thorsrud@bi.no

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The 'Dutch disease' reexamined: Resource booms can benefit the wider economy - USAPP American Politics and Policy (blog)

by Sean Orr | So Christy Clark somehow thought it would be a good idea to go on Facebook Live. The results were as disastrous/totally benign as you might think.

Watch for yourself as a sea of angry emojis engulfs the premier while she doubles-down on her populist rhetoric in an exercise of pure agitprop. Watch as Vaughn Palmer lobs handpicked softballs from BC Liberal digital influencers.

Watch as she says I think we are implementing those recommendations regarding the recent report on the death of Alex Gervais while rejecting the idea of replacing herembattled B.C. childrens minister.

Watch as she says we are armed and ready to fight Trump on softwood while weve lost 30,000 forest jobs in this province since the B.C. Liberals took power due to a record number of raw log exports.

Watch as she says that Debt Free BC means we have the intention of getting there. Watch as she admits that job creation in Alberta had stalled because it hitched its entire economy to a single resource, and then just seconds later doubles down on LNG. Watch as she says LNG is clean. Again.

Watch as she actually thinks that British Columbians calmed down their fiery rhetoric to the Kinder Morgan pipeline just because it was Justin Trudeau who approved it. As though thousands of people didnt take to the streets.

Watch as she admits that there are two British Columbias, one that is falling behind because of their resource-based economies.

Watch her saywith a straight face that BC in fact does have a poverty reduction plan: Its called a jobs plan. Oh great, tell that to the disabled. Tell that to the mentally ill. Tell that to the addicted.

Take a drink every time she mentions jobs, as though shes never heard of precarious labour and ignoring the fact that were losing full-time jobs everywhereexcept in Vancouver and Victoria. People want to work! Yeah, just maybe not at the 24 Hour Tim Hortons on Abbott and Pender.

Watch as she intermingles the political and the personal with ease! (Dont talk about my son, Hamish. My Dad was an alcoholic). The problem with mental health issues is not just that people dont talk about them, its that governments do nothing about them until an election comes around.

Watch as she says that her stipend had suddenly become an issue and that she could do without the money as though it wasnt in The New York Times.

Watch as she says the NDP has said this is going to be the ugliest and dirtiest campaign weve ever seen when it was actually Liberal cabinet minister Bill Bennett who said that. Watch as she doubles down on the claim that her website was hacked despite the fact Mike Smyth found it in plain sight. As Palmer says (as he found his spine), perhaps it was Putin.

But what didnt Palmer ask about? He didnt ask about raising the rates. Didnt ask about the current lawsuit by First Nations against the government regarding Kinder Morgan. He didnt ask about the conflict of interest with the conflict of interest commissioner, probably because hes already defended him.

He didnt ask about the BCTF lawsuit. He didnt ask about the health care firings. He didnt ask about MSP premiums. He didnt ask about getting big money out of politics.

He didnt ask about the 25,502 unoccupied homes in Vancouver, more than double City Halls estimate.

Meanwhile, Patients in hallways as hospital space reserved for Kate Winslet movie. The movie is called The Mountain Between Us. Sort of like the mountain between us and the bureaucracy that thinks this was a good idea.

Some good news: Missing Canadian found undocumented in Brazil after years. When asked if he had found what he was looking for during his many years of wandering, Pilipa simply replied, Im still looking.

Introducing a new game called Vancouver snow bingo. Spaces include: someone saying the city just shuts down; someone with an umbrella; that one guy wearing shorts; someone from Alberta saying it isnt a big deal; someone from Ontariosaying they moved here to get away from this shit; a Dodge Caravan just spinning its wheels; someone complaining about bike lanes being ploughed;some one the Skytrain saying its not the snow that I hate, its the slush; someone calling it a snowpocalypse;and of course someone making an AirBnB out of a snow fort.

Other possibilities: Someone saying only in Canada: Only in Canada: Central Saanich man uses Zamboni to clear streets of snow, police say.

Exhibit B: Hapless Abbotsford burglars getaway van gets stuck in snow, asks for help from homeowner he ripped off.

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Bonus: VIDEO: Body Break TV stars are back, results are bloody brilliant.

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TEA & TWO SLICES | On Giant Snow Penises And Christy Clark's Shudder-Worthy Interview - Scout Magazine (blog)

Despite constant talk about plans to boost the nations economic growth, experts remain skeptical about any efforts to wean the Russian economy off its dependence on oil.

Risks differ because they are possible to measure, while unpredictability is impossible to assess. And this bring about a sort of torpor among investors. Photo: RIA Novosti

As Russias top economic leaders prepare for the upcoming Russian Investment Forum in Sochi, scheduled on Feb. 27-28, there has been increased discussion among experts about what steps need to be taken this year to propel the Russian economy forward. For now, the focus seems to be on new investment projects for economic growth.

Yet, as Russian and foreign experts discussed at a Feb. 8 event at the Carnegie Moscow Center, it will take more than just new investment to jump-start the economy. As long as the Russian economy depends on oil and the gray market remains commonplace in the country, it will be challenging to carry out effective structural reforms, attract investors and boost economic growth.

This is the key message of the discussion that brought together the director of Stockholm Institute of Transition Economics Torbjorn Becker, the head of the Moscow-based Economic Expert Group Evsei Gurvich and Carnegie Moscow Center expert Andrei Movchan.

Gurvich argues that Russias key problem is the resource curse, which results from the cyclical nature of oil prices (with alternating cycles every 15 years or so). When prices rise, oil revenues also increase, which increases the rivalry among political elites for the control of the oil rent. In this situation, the authorities think not about the efficiency of the economy, but about grabbing a bigger slice of the pie. This is how the state assumes a greater control over the economy, in general.

Russian economic dependence is very deep on the macroeconomic level, Becker continues, adding that volatile changes in oil prices could have either negative or positive effects on Russias gross domestic product (GDP) and other economic indicators.

According to him, about 80-90 percent of forecast mistakes come from the fact the pundits and politicians cannot predict oil prices properly. For Russias policymakers, it means that they cannot control the economic situation in the country and this a big challenge for the authorities, said Becker.

Even though Russias sovereign wealth funds the Reserve Fund and the National Welfare Fund are good tools for rainy days, they primarily deal with short-term management of oil volatility. Thus, they cannot resolve the problem of unpredictability.

As Andrei Yakovlev, the director of the Institute for Industrial and Market Studies at the Higher School of Economics, told Russia Direct in a 2016 interview, investing in an unpredictable environment is highly difficult, because business is used to assessing risks.

Risks differ because they are possible to measure, while unpredictability is impossible to assess, he clarified. And this bring about a sort of torpor among investors.

Moreover, the unpredictability that stems from the volatility of oil prices is narrowing the planning horizon among those at the helm, said Gurvich. Thus, the Kremlin relegates any strategic thinking to the secondary agenda and prefers to think even shorter term. This cannot help affecting the countrys economic growth; it does create favorable environment for the budget deficit.

Not only does the oil-dependent economy create a great deal of uncertainty and make the authorities helpless during abrupt changes in oil prices, but also it affects the structure of Russias trade with its European partners by making it one-sided.

To illustrate this trend, Becker gives an example of the trade between Russia and Sweden, with oil exports comprising about 80 percent of the products from Russia and Swedish exports being more diversified. Russia should be careful about the danger of one-sided oil dependence. After all, it could affect the countrys economic growth and efficiency, said Becker.

However, Movchan looks at the resource curse from a different angle. He prefers to focus on the advantages that the commodity-based economy creates for the authorities and the population. Even though he sees oil dependence as a challenge for Russias economic and political future, Movchan admits that those who work for the government about 38 percent get their salaries from the state budget that depends on oil revenues. In other words, the Russian population itself is the key consumer of the resource curse, because its income is determined to a larger extent by oil prices.

Second, significant oil resources yield another advantage: very cheap energy. Movchan gives an example from day-to-day life: the average temperature in Russian houses is 23 degrees Celsius (73.4 degrees Fahrenheit), while American houses are heated to just 16-17 degrees Celsius (62 degrees Fahrenheit). In fact, the energy consumption (and economy) in Russia is adjusted to lower prices on hydrocarbons and it defines the key habit of Russians, which they are reluctant to change.

Moreover, the Russian army depends on low energy prices in the country and nobody even cares about the amount of money to maintain the countrys military forces. Given the fact that Russians sees these forces as a guarantor of political stability, territorial integrity and geopolitical influence, oil in this regard mobilizes people around the leader and creates a sort of stability, even if illusionary and ephemeral.

However, it doesnt necessary mean that oil is good for the nation per se. According to Movchan, the oil dependence is a curse, an evil for the long-term development of the country, but it is necessary to understand the short-term oil benefits for the Kremlin and the population to avoid many pitfalls on the path to structural reforms. It is also essential not to turn into another oil-dependent Venezuela, which is now on the verge of political collapse because of ill-thought-out economic initiatives.

Today, the Russian authorities are looking for political and economic stability. And if one looks at the situation from their perspective, they naturally shy away from any reforms, which could endanger their positions and this is a normal behavior, says Movchan. In order to foster the sweeping changes, they should stop being policymakers and turn into reformers who are ready to destroy the old system and build the new one. Obviously, this is not what the current Russian political elites are looking for now.

Thats why any forecast about higher oil prices is music to the ears of those in the Kremlin. After all, high oil prices (which translate into economic prosperity) boosted the approval ratings of Russian President Vladimir Putin as well as Soviet leader Leonid Brezhnev during their tenures. Meanwhile low prices on hydrocarbons (which led to economic woes) ruined the reputations of Soviet President Mikhail Gorbachev and his successor Boris Yeltsin, in part, because their presidencies coincided with a period of low oil prices. Gurvich pointed out the correlation between their popularity and the oil cycles during his speech.

The expert believe that Russia will become a magnet for investors only when the oil dependence era will end, when oil revenues wont be relevant for the authorities anymore, when oil prices will drastically plummet. If it happens Russia will be forced to produce the goods that it imports now.

Thus, the Russian political elites will be ready to conduct the sweeping structural reforms, only if they will be faced with the existential threat for their stability and well being, Gurvich concluded.

The only problem is that when the Russian authorities have to deal with economic challenges, they arent ready to take the difficult next steps. Instead, they have a penchant for organizing lavishly funded economic forums that bring together top economists, politicians and diplomats from Russia and abroad.

There are at least five major economic forums that take place in Russia each year the St. Petersburg International Economic Forum, the Eastern Economic Forum in Vladivostok, the Gaidar Economic Forum, the Yalta International Economic Forum, and the Russian Investment Forum in Sochi. In a nutshell, their major goal is to create an intellectual and business platform for boosting the countrys economic growth and raising Russias global profile.

There is no unanimity about the efficiency and viability of such forums among experts and independent economists. While some see them as an opportunity to attract foreign investors and discuss the most urgent challenges while cutting important deals, others describe such forums as a convenient photo-op, a sort of party or talk show for pundits and politicians. Such platforms may be splashy, but are often inefficient. In short, they may promise more than they actually deliver.

For example, Oleg Buklemishev, an associate professor of Economics at Lomonosov Moscow State University, is skeptical about the impact of investment forums.

Do these many economic gatherings pay off? Im not sure, he told Russia Direct. But inertia and the benefits for organizers and the local communities in general outweigh the costs, which are usually spread between many and some of them cant vocally speak out (for example, the taxpayers).

At the same time, Buklemishev admits that these investment forums do perform some useful functions no matter how strange it may seem.

First, there are very few places where politicians have to address businesses and their everyday needs, explain their position, speculate about intentions and even logically justify them. Sometimes this is the easiest way to access the views of top government leaders and themselves personally, he clarified.

Second, these are platforms for communication between business leaders, to share news and challenges, forge practical contacts and relationships and get a feel for the atmosphere of the marketplace, he notes.

Third, this is a mechanism for the general audience to know something about the authorities views and economic perspective, Buklemishev concluded. Fourth, sometimes the discussions put forward some helpful ideas, which experts share with the bureaucrats and the business community. Fifth, this is a powerful way to support local hospitality industries hotels, restaurants, transportation and entertainment.

Pavel Koshkin is the Editor-in-Chief of Russia Direct. He has contributed to numerous publications, including Kommersant, the Moscow bureau of BBC and Russia Profile, specializing in politics, society, education and international affairs.

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When will Russia finally break its 'resource curse'? | Russia Direct - Russia Direct

= Despite many strategies, it has been difficult to achieve many development goals in agriculture. 2daysago

The country is in the throes of a ravaging drought with an estimated 2.7 million people facing acute food shortage.

Yet the country has settled into the frenzy of electioneering underlining the insensitivity of the political leadership. But this precisely underscores why we regard enough food and agriculture as a key agenda item in this election.

For many households, enough food is neither available nor affordable. However, this lack of enough food is not new. Since independence the government has declared its desire to have all Kenyans enjoy, at all times, safe food in sufficient quantity and quality to satisfy their nutritional needs that meets their cultural preferences, throughout their life-cycle.

Kenya Vision 2030 aspires to set the country on a prosperity path to be a globally competitive newly-industrialising, middle-income prosperous nation with a high quality life for all citizens by the year 2030, The Kenya Vision is being implemented through medium term plans.

The second medium plan identifies a number flagship projects for the agricultural sector including (i) policy, legal and regulatory reforms; (ii) Asal development in the Tana and Athi river basins; (iii) fertiliser cost-reduction; (iv) establishment of disease-free zones; (v) development of geo-spatial land use master plan; (vi) development of fisheries (blue economy).

Despite many strategies and efforts, many regrettably half-hearted, by the past and current government, it has been difficult to achieve many measurable aspirational development goals in the agricultural sector.

It is worth noting that agricultural systems in the country are characterised by eight agro-ecological zones suitable for different crops and livestock systems, based on altitude and rainfall patterns. Incidentally, human settlement has virtually followed the same geographical zonation.

Diverse agro-ecological potentials imply that different counties have varying economic opportunities in developing their crop and livestock sectors (and fish farming). Historically, counties with high or medium rainfall have received more public investments compared to those regions perceived to bear low potential such as the arid and semi-arid lands.

Public investments in agriculture have been considerably influenced by politics through policy making, public finance and donor funding.

As we enter another electioneering period, it can be safely said that there have been little efforts by our politicians to listen to voices of the farming community. During the election period, populist policies are promised to farmers in order to get their votes, and in many cases, little follow up is made to implement the promised projects.

For instance, in the last election cycle, Jubilee (and other opposing parties) made promises that cheap fertiliser would be made available to the poorest farmers, promises of reviving meat-processing facilities (such as Kenya Meat Commission, irrigation dams to be built and export markets to be sought. Often, many such promises are quickly forgotten once the elections are over, or are implemented in a half-hearted manner.

This cannot continue while the potential in agriculture to feed the nation, create gainful employment, revive our agro-based industries, and earn foreign exchange lies unexploited to the maximum possible limit? It is time to make some reality check on what agriculture can offer Kenyan citizens since the country aims to promote an innovative, commercially-oriented, and modern agricultural sector.

Irrigation reduces reliance on rainfed agriculture and that is reason several delegations have visited many countries, including Israel, to learn from what they do. However, the government has not done much on irrigation and neither have we benefited from the so-called benchmarking trips.

Four years ago, this government pledged to put one million acres under irrigation in five years. It identified 1.78 million acres in the Galana/Kulalu ranch (Kilifi and Tana River counties) for irrigation. A feasibility study was undertaken at a cost of Sh 1.2 billion.

The study recommended 10 investment plans, including beef and game ranching (49,085 acres), horticulture (42,817 acres), orchards (74,646 acres), sugarcane (177,136 acres), maize (93,540 acres), fish (9,577 acres), dairy (4,703 acres), bee keeping (4,611 acres) and agro-processing (5,334 acres).

It was expected that a total of about 25 million bags of maize were to be annually produced from Galana and thus bring the country back to the state of annul national food sufficiency with a surplus. So far, only 2,500 acres have been put under irrigation and produced 60,000 bags of maize.

It is disappointing. Perhaps it is time to look for any strategic lessons of the abandoned Bura irrigation scheme.

Maize consumption per person is estimated at 1.5 bags per year. Based on an estimated adult population of about 35 million, the countrys annual maize consumption stands at more than 50 million bags. Beans production stands at 6.8 million bags while consumption is an estimate 6.5 million bags, wheat production is 3 million bags, rice production is estimated at 113,000 tonnes while consumption is at 564,000 tonnes.

When shall Kenya have enough food? Any war is waged and won based on a definitive strategy.

One, there must be a deliberate political and policy shift to other ways and means of ensuring that enough food is available, accessible and affordable. Second, it is perhaps time to look for alternative ways to approach irrigation.

INVESTMENTS IN SMALL DAMS

It may involve investments in small dams using supplementary irrigation systems to reduce energy running costs.

Third, community ownership in irrigation and water management will be crucial and this brings into focus the role of county governments in driving agriculture as a devolved function.

Fourth, making water and improved sanitation easily accessible implies that girls would spend more time in school, and women would spend more time in productive activities, thus improving the general well-being of households. The UNDP estimates that for every Sh100 investment in water and sanitation leads to a Sh800 return in economic productivity.

Finally, while it is important that the country moves from dependency on rain-fed agriculture and maize, our national focus on food will require deliberate and sustained investments in better information services, use of modern agro-technologies to increase production, preservation and better use of food, investment in high-value traditional and non-traditional foodstuffs (agribusiness). Without value addition, agriculture, livestock and fisheries will be of little value to counties.

The government embarked on three-tiered fertiliser cost-reduction programme involving supply chain improvement in the market, blending of fertilisers and local manufacturing of fertiliser.

The policy objective was to reduce the cost of food production to enable the county have enough food. The average price of a 50-kg subsidised bag of top-dressing fertiliser was Sh 2,000 while market price was Sh4,500.

The fertiliser cost-reduction programme required multiple initiatives including (i) capacity building of farmers, farmers co-operatives / associations; (ii) estimating annual fertiliser demand, (iii) efficient fertiliser procurement and distribution systems, (iv) provision of warehousing (NCPB stores, large co-operative societies, etc.); and (v) addressing infrastructure challenges.

A fertiliser manufacturing factory has been completed (August 2016) at a cost of Sh120 billion in Eldoret although it is yet to be commissioned.

Kenyans will be waiting to see how the facility will contribute towards the reduction in the cost of fertiliser in the foreseeable future due to a number of potential bottlenecks.

First, Kenya is not endowed with substantial quantities of raw materials for manufacturing fertiliser except filler material such as limestone.

Second, the domestic market for fertiliser is too small for any viable fertiliser plant.

Third, key industry experts have never interrogated the contents of both the feasibility study and the independent appraisal to understand the parameters used for establishment of the plant in Eldoret.

Fourth, according to the presentation made to the Parliamentary Committee on Agriculture, the Eldoret plant is not a fertiliser manufacturing factory but a blending plant where the same fertilisers are imported and blended. There are several types and many types of fertilisers used in Kenya.

Land is perhaps one of the most contentious political, economic and social problems in the country and is at the core of most of the resource-based socio-economic challenges Kenya faces, the most profound being the 2007-2008 post-election violence. It touches the very fabric of national cohesion.

There have been many past attempts to harmonise and consolidate the legal framework touching on land and its administration in order to guide equitable and efficient utilization of land for different purposes (agriculture, industry, human settlement, wildlife and forestry).

There have been calls for a national land information management system, legislation of minimum acreage per person to reduce speculation, automation (digitisation) of land registries, development of a national geo-spatial land use master plan, amongst other measures, to safeguard individual and community claims to land.

Indeed, in some areas where land is not titled, this government pledged to issue six million title deeds. Although there was a recent setback, a number of titles have been issued although proper procedures were not fully followed, as was ruled by the High Court in January 2017.

Greater effort must be made to address the land question for various reasons, including providing incentives for greater use of agricultural land. Secure land ownership is the bedrock of all investments.

It is clear therefore that a significant investment in agriculture is key to resolving our challenges in food self-sufficiency, employment, economic development of the Asals and, the conundrum around land ownership and land management issues.

management issues. Blithe promises are inevitable during campaigns but Kenyans must be empowered to query political parties, and later governments, on such promises.

Traditionally, the main factors of production are land, labour and capital (including knowledge, credit). Taking energy as a proxy for labour, we have to use people, livestock and machines to increase the amount of energy for driving agriculture for production, processing, transportation and preservation.

In the early years, the country relied on human labour and animals in agriculture. However, the country must embrace mechanisation to reduce drudgery and offer the youth a viable motivation to engage in farming as a more dignified and dependable occupation.

Mechanisation promotes social recognition as it significantly reduces the hardship of employing farm labour. Hard work is regarded as a poor persons job or an occupation for people with little brains.

It will require specific and deliberate strategies to make appropriate mechanisation services (like hiring tractors) a profitable and sustainable investment for different agricultural processes. We can do it and those seeking leadership must demonstrate beyond the rhetoric that they understand this and have concrete plans to implement them.

The pastoral communities are amongst the hardest hit when we experience droughts and they are often the ones at whom empty promises are directed during elections.

The various challenges posed by drought as epitomized by periodic conflicts over pasture and water must be addressed in a holistic manner.

Kenya is a water scarce country and must improve water security, management of water catchments and wetlands, enhance water resources monitoring as well as increase investments in water infrastructure development.

Development of boreholes must take cognisance of underground water resources to guard against overexploitation as water will become salty and unusable. We, nonetheless, must end drought emergencies.

Kenyas livestock and livestock products are not perceived to meet international zoo-sanitary ( hygiene and safety) standards.

MEET MARKET ACCESS CONDITIONS

In order to meet international market access conditions, the government pledged to create six disease-free zones and three export abattoirs in the coastal zone (Kwale, Kilifi and Taita Taveta); Laikipia, Isiolo and Samburu zone; Makueni and Kitui zone; Tana River zone; Central Kenya zone and South Rift zone.

So far, a feasibility study and bill of quantities had been done for only the Bachuma disease free facility on a 15,000 acre land (Taita-Taveta County). The government will spend Sh2.6 billion. When completed, the Bachuma Disease Free facility will have a holding capacity of 24,000 cattle, 297,000 sheep and goats and 18,000 camels.

While commendable, it is time to revisit the issue of disease free-zone as a strategic investment considering the importance of the pastoralist economy and the perennial electioneering promises that have been pledged time and again. Perhaps, except for the Middle East, Kenya must focus on improving livestock production to meet domestic and regional demand.

Many farmers lose most of their produce, especially perishable commodities (like vegetables, milk, fish and tea). Post-harvest losses are estimated at between 30 and 75 per cent depending on the commodity.

These losses are mostly because of poor transport networks, low value addition, lack of storage and preservation facilities. This calls for effective strategies to invest in post-harvest management; cold storage facilities, value-addition and warehousing.

There are many investment opportunities (by both local and foreign entities) in many agricultural value chains (input supply, production, agro-processing and marketing) if marketing infrastructure is developed and expanded.

Can we address the land question?

Land is perhaps one of the most contentious political, economic and social problems in the country and is at the core of most of the resource-based socio-economic challenges Kenya faces, the most profound being the 2007-2008 post-election violence.

It touches the very fabric of national cohesion. There have been many past attempts to harmonise and consolidate the legal framework touching on land and its administration in order to guide equitable and efficient utilization of land for different purposes (agriculture, industry, human settlement, wildlife and forestry).

There have been calls for a national land information management system, legislation of minimum acreage per person to reduce speculation, automation (digitization) of land registries, development of a national geo-spatial land use master plan, amongst other measures, to safeguard individual and community claims to land.

Indeed, in some areas where land is not titled, this government pledged to issue six million title deeds. Although there was a recent setback, a number of titles have been issued although proper procedures were not fully followed, as was ruled by the High Court in January 2017.

Greater effort must be made to address the land question for various reasons, including providing incentives for greater use of agricultural land. Secure land ownership is the bedrock of all investments.

It is clear therefore that a significant, strategically consistent investment in agriculture is fundamental to resolving, in a sustainable manner, our challenges in food self-sufficiency, employment, economic development of the ASALs and, the conundrum around land ownership and land management issues.

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Substantial investment in agriculture needed to ensure enough food for all - Daily Nation

As the United States foreign policy under new President Donald Trump is still faltering and China refrains from becoming a full global playmaker, Russia and its post-Soviet helmsman Vladimir Putin are apparently calling the shots in the world stage.

From the Baltic in Europe to the South China Sea in East Asia, a Russian diplomatic cobweb has in fact been spun across the Eurasian continent and its appendices in North Africa. Now, the question is whether Moscow will be able to handle this strategic over-extension, which entails the use of considerable resources, while its economy is in bad shape.

Many believe that the Kremlins current transcontinental projection will not be halted by the countrys economic problems; and this because Russia included in its Soviet configuration has always been an imperial power capable of facing up to structural economic weaknesses.

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According to this vision, economic liabilities historically have never prevented the Russian bear from expanding its territorial boundaries to prop up the nations internal security. In this equation, the Russian rulers would have successfully leveraged on the deeply-rooted patriotic sentiment of their people, who have showed a strong resilience to material shortages through the centuries.

So, encouraged by the perceived vulnerability of the US, which is linked to many factors, among them former President Barack Obamas decision to shift focus from Europe and the Middle East to Asia-Pacific, Donald Trumps shocking electoral triumph, a confused presidential transition and a turbulent start of tenure for the new US commander-in-chief, it is reasonable to expect that Russia will continue to move on many fronts, regardless of its economic woes.

Moscows hunt for geopolitical influence is indeed remarkable, starting from its squabbling with the European Union (EU) and Northern Atlantic Treaty Organization (NATO) in Eastern Europe, where it has been supporting separatist rebel groups in eastern Ukraine after annexing Crimea in 2014. The Kremlin is also developing a robust military apparatus in the Baltic area and reactivating military capabilities in the Arctic region.

The post-Soviet space from the Caucasus to Central Asia obviously remains Russias strategic backyard. Still, the Kremlin will insist on playing the kingmakers role in the Syrian crisis while trying to extend its clout in the Middle East and North Africa. In this sense, Moscow is enhancing ties with Egypt, eying a possible part in the Libyan peace process and cautiously monitoring developments in the worn-torn Yemen.

Furthermore, the Russian diplomacy is reaching out to Afghanistan, where it is working to find a diplomatic solution to the current civil war, quite separately from Washington. To conclude, Russia has a visible presence in the Pacific region, where it still has to settle the age-old territorial row with Japan over the Kuril Islands; Moscow is also an important stakeholder in dealing with the North Korean nuclear threat, discreetly teams up with China on the South China Sea territorial disputes and has even promised naval help to the Philippines against piracy in the Sulu and Celebes seas.

Russia/Soviet Union found itself in a similar situation between 1974 and 1979, when it raised the stakes in the confrontation with the US. In the space of six years, in fact, the Kremlin displayed a wide-ranging foreign policy that led many to believe that it was going to win the Cold War. All of this as Washington was struggling with a deep political and identity crisis amid a climate of widespread cultural contestation, marked by President Richard Nixons resignation due to the Watergate scandal and the countrys defeat in the Vietnam War.

Moscow tried to profit from the American apparent disorientation during that period and launched its multi-pronged challenge. It backed communist guerrillas in Central America and sent military advisers in Angola and Mozambique. In these two African countries, which had just gained independence from Portugal, the Russian troops supported along with Cuban soldiers the local Marxist armed formations in their efforts to seize power.

Then, Russian regular and irregular military personnel came to the rescue of Ethiopia as this was fighting the Ogaden War against Somalia. In addition, Moscow strengthened further its ties with the Baathist regime in Syria, buttressed the communist-leaning government in Southern Yemen, where it had naval facilities, and sustained Vietnams occupation of Cambodia against the pro-Chinese Khmer Rouge regime. Lastly, the Soviet Red Army placed the icing on the cake by invading Afghanistan.

This far-flung foreign commitment proved to be largely unsustainable in the short-run. In the 1970s, the Soviet Union was in a critical economic situation, largely dependent on grain and technology supplies from the US, with a centralized and inefficient political system and a natural resource-based economy resembling an underdeveloped countrys. A picture that has several similarities with the current health of the Russian economy, hit hard by years of budget deficit. Though a timid recovery is forecast in 2017, at the recent Gaidar Economic Forum, Russian Prime Minister Dmitry Medvedev warned the nation against the structural problems of Russias economy, particularly its technological gap with developed countries, the dependence on commodity export at a time of low oil and gas prices and the excessive public role in the productive processes.

Thus, a hypertrophic foreign conduct, not backed up by a solid economy, contributed to the fall of the Soviet empire along with other geopolitical and cultural factors. If Russia wants to avoid this outcome and protract the Putinian Pax for a while, it will have to eliminate this antinomy; or, at least, it will have to find creative alternatives. The idea of using money and propaganda to bolster the rise of anti-EU and anti-NATO populist movements in Europe could serve this purpose. Unless, like in the 1980s, the Western world comes out with new, effective antidotes to the Russian advance.

Emanuele Scimia is a journalist and foreign policy analyst. He is a contributing writer to the South China Morning Post and the Jamestown Foundations Eurasia Daily Monitor. In the past, his articles have also appeared in The National Interest, Deutsche Welle, World Politics Review, The Jerusalem Post and the EUobserver, among others. He has written for Asia Times since 2011.

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Can Russia project power while battered by economic woes? - Asia Times

THUNDER BAY Thunder Bays population grew between 2011 and 2016, but not by much.

According to census data released on Wednesday by Statistics Canada, the city and surrounding communities grew by just 25 people over five years

Thunder Bays census metropolitan area population now stands at 121,621, slightly more than the 121,596 posted in 2011.

However, the city itself experienced a slight drop in population, from 108,359 five years ago to 107,909, a decrease of 0.4 per cent.

"I think it underscores the challenge that all northern, rural, smaller communities right across Canada (and) right across North America continue to have," said Minister of Municipal Affairs Bill Mauro. "There is a level of large-scale urbanization that is taking place in our large centres -- Vancouver, Calgary, Edmonton, Montreal, Toronto and the like.

"Communities like ours and hundreds of others are continually faced with work and an effort to try to grow and sustain their population. It's not easy to do."

Mauro said the key to turning things around is economic diversification and embracing a knowledge-based economy, while protecting resource-based jobs as best as possible.

"I think that's the goal, I think that's the best way for us to see increases in our population and we've actually had some successes in that regard."

Regionally, Terrace Bay experienced tremendous population growth over the past five years, jumping by 10.5 per cent to 2,798 residents last year when the census was taken. Nearby Schreiber, however, fell by six per cent to 1,059, down from 1,126.

The national average growth was five per cent, representing about 1.7 million people. The countrys population was 33,476,688 in 2011 and is now 35,151,728.

Sylvan Lake, Alta experienced the highest growth level between census periods, increasing in size by 19.6 per cent. Among communities with more than 100,000 residents, Calgary was the fastest growing, jumping 14.6 per cent to 1,214,839.

Campbellton, N.B. was the lowest performing CMA in the country, seeing its population drop by 9.3 per cent.

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Thunder Bay's population experiencing low growth - Tbnewswatch.com