Covid and the criminal leadership

Data and acts are truly clear. Covid is a serious threat. To life and to the economy. Only a fool can pretend otherwise. And if such fool occupies a position of power, he is not only a dupe but also and, above all, a criminal.

The transition ahead of us

Many of us are now getting tired of the lockdown. This is, therefore, a dangerous period, when people start looking for opportunities to escape the quarantine and become more critical of the authorities. They are also feeling the squeeze when it comes to their income. Many families have been living on small budgets. They are at the limit of what they can sustain. They want to go back to the economy. They think it should be possible if adequate protection measures are implemented. Long transition periods might be wise from a public health point of view but have serious political costs. Governments must be clear when explaining the way the transition is expected to work. That is a task that requires top attention.

The balance that must be found

There is fear and growing poverty, in most corners of the world. We witness uncertainty and despair. The pandemic is killing people and destroying livelihoods. These are the two critical dimensions that must be tackled as a matter of great priority. Both are very urgent matters. The wise leader is the one that can strike the right balance between them. And who knows how the balance should evolve. That means, among other things, that an absolute and prolonged lockdown, with no economy, is not a balanced approach. It is not even necessary if there are enough masks to go around and the appropriate human behaviours are followed.

I just learned, for instance, that Argentina has decided to close its commercial airspace up to September. That is too long and certainly not a sage decision. A country like Argentina, which is already in an awfully bad economic shape, should approach any drastic decision with lots of prudence. The same, elsewhere. I mention Argentina as just an example.

A war economy or just words?

You call it a war, but you keep acting as if there was no need to reorganise the entire production to win the war. When you are at war, your economy must become a war economy. If not, you are not a good leader and you cannot connect your words with the reality that must be put in place. 

Our daily dose of fear

In my area of the city there is one big supermarket. I go there every Thursday morning, for the weekly shopping. And sometimes, one more time, for some item that might be needed and was left out of the weekly list. During the last two or three weeks, I noticed that the number of people inside the supermarket is much smaller. Not because of any entry control, let me add. It all starts at the underground parking. Nowadays, it’s much easier to find a good spot for the car. I should add that most of those shopping on Thursday in morning are older customers, retired people. I am told they are afraid of spending time in the big shop. And today, as I was chatting over the phone with a friend, I got the confirmation that there are many people – and more so now, as the bad figures keep increasing – who are simply afraid of any contact, even a distant one, with other shopping fellows. And I said to myself that we are living in very strange times, when the simple act of moving along the wide aisles of a supermarket is seen as a dangerous exercise.  

So much has changed

We are about to close the second decade of the XXI Century. As we look back, the last 10 years have been a time of major transformation and change. The year 2010 seems to be far back and to belong to another era. Politics have changed, and not for the better. Lies and polarisation are new key features. The economy has also gone through major transformations. Artificial Intelligence, computerisation are the new dimensions. But they are not alone. The economic changes have also brought new levels of precariousness and powerlessness, job insecurity and a frustration. And then, there is a new understanding of the climate crisis. It is unfortunately accompanied by actions that are too small to effectively respond to the issues we face.

In many ways, I think we end the decade with a stronger feeling hopelessness and deep distrust for those who are in charge. We are also more contradictory in our own way of looking at things. We know but we do not want to change what we got used to. We just hope others will do it.

That goes along with a serious leadership crisis. The political and thought leaders are no longer those who are in power. They are among the little people, the ordinary citizens and, in many ways, among the very young. There again, there is a serious gap between political authority and moral authority. That’s one the challenges we have to address we get into the next decade.

Not bad, this year's G7 Summit

Several experienced international analysts raised the issue before the meeting: is the G7 still relevant? They had in mind last year’s messy summit in Canada, as well as the fact that there are serious divergences within the group, particularly with President Trump’ views, not to mention that these countries have lost weight in the world economy. They barely represent about 40% of the global output, much less than when the G7 was established, over twenty years ago.

Many concluded that the G7 Summit had outlived its usefulness. That the summit was no longer justified.

My opinion has gone in the opposite direction. I wrote in my Portuguese language blog that such meetings are still advisable. They can help. Summits give an opportunity for eye contact between the leaders. That is important, particularly at a time when so much power is concentrated in so few hands. We live in a period that considers electoral legitimacy almost absolute, even beyond established rules and practises. I am against such an approach, but the fact of the matter is that we see leaders of our democracies claiming levels of authority that come close to personal autocratic rule. In such circumstances, personal contact can make a difference. Leaders must meet frequently.

The G7 is one such opportunity.

This time, the expectations were relatively low.

But the summit in Biarritz, France, went well beyond the expectations. It has been a better meeting than we had anticipated. The final press conference, that brought together the French and the US Presidents, has showed that the dialogue avenues are not closed. Both Presidents did well when responding to the media. We could see the differences of opinion between them, but they were dealt with tact.

One could say that much of the success achieved during the summit must be put to the credit of Emmanuel Macron. That is to a large measure true. He has been able to navigate the very difficult matters that were on the table as well as the unique egos in the room. It would be unfair not to recognise President Macron’s ability and efforts. However, there is more to it. The issues on the agenda are too big and complex – we have undoubtedly a very delicate mix of global problems. And global means global, when it comes to the negatives of such issues. The mood, when discussing them, could only be a serious one. Even in the case of those leaders that tend to see the world from their own very narrow prism. That’s not bad.

Europe and China: let's be constructive

The EU and China have their annual summit in Brussels today. The preparatory work has shown that Europe is now prepared to have a firmer position in matters of trade, investment and protection of industrial patents and copyrights. That is the right approach for the economic relations between both sides. Beijing might not like it, but they understand the rationale behind the European position. They fight for their interests, and we should fight for ours. That is the only basis for a sound relationship between two major international players.

When dealing with China, the EU must remain united around the principles of reciprocity, fair competition, and respect for the natural environment.

The Europeans have also to consider that we are dealing with State capitalism at its strongest form. Behind each big corporation, there is the Communist leadership of China and their concern with their own survival as a regime. For that, they need to expand the Chinese economic interests abroad, control new sources of wealth in foreign lands, and bring back prosperity to the people of China. Europe is a special land of business opportunities, an attractive economic space for big investments. That’s fine, if the basic international rules are respected and the link between each side is open to accept traffic on both directions.

Above all, the Europeans must keep in mind issues of national security. As far as we are concerned, China is a partner with greater potential for business but is also a first-grade geostrategic player. We must be able to keep our strategic sectors under our own control. That will contribute in no small manner to balance the geopolitical power of our Chinese neighbours. The world needs our contribution to the balance. Europe’s big challenge, in this area, is to remain a strong pillar of international wisdom.

Politics as currently played

I rarely write about religion. I am even tempted to say I never write about the matter. But being prudent by nature, let me use the word “rarely”. Or let me say it differently: to me is clear I avoid commenting on religious matters.

As a regular blogger, both in English and Portuguese, and when for many years I wrote as a columnist, politics is my theme.  And now, as I watch the political debate and the fights associated with it, I am getting the impression that for many people partisan politics has become like an act of faith.

Politics today seems to be much closer to religious beliefs, and the traditional intolerance that goes with them, than to social and economic choices. There is plenty of emotion and very little rationality. That has an obvious impact on the discourse of public figures that want to be successful in politics. They go for the soul, not for the mind.

The Chinese move to London

The Chinese President´s official visit to the United Kingdom has not received a lot of attention in the European media. This is rather surprising. The visit is significant for a number of reasons that go beyond its obvious impact on the UK´s economy. 

Let´s mention some of them. The visit has substantially strengthened the Chinese political and economic interests in Europe, making the UK the preferred launching pad for further Chinese investments in the EU. It has also shown that Beijing believes the UK will remain within the EU. And it is tying the UK´s foreign policy to the Chinese ambitions.

It is true that both countries gain from the closer relationship. However, with time, this is above all a very strategic move by President Xi Jinping. He comes out of it stronger, abroad and at home. 

Spain is getting back on its feet

I just spent a good number of days travelling in the Andalusia Region, in Southern Spain. I saw once again a country full of dynamism. To me, all signs appeared to show that the economic recovery is firmly on its way. Business is moving up. This is certainly good news.

It is also true that people keep complaining about the cost of living, the scarcity of job opportunities and the high-handed taxation system. They are certainly right. Spain, like other EU countries, is putting too much pressure on the working people. They are the ones that finance a good deal of the recovery. They are the ones that get heavily taxed. And this should not be the case. 

In Riga with hope

When in Riga, as it is again the case at present, I am amazed by the elegance and good manners of its people. I can only wish they will be able to keep the society together, notwithstanding the linguistic and social divisions, and keep the economy growing.

The region might feel nervous because of the events in Ukraine. But the Baltic States are not in the same predicament as Ukraine. They are now part of the EU and NATO. They belong to a greater political space. And their geo-economic situation can be an advantage, a major trump card. They can be a strong link between the rest of the EU and Russia, once the situation goes back to normal. And I hope that will be the case one day in the coming future. 

Interdependence and new approaches to conflict resolution

During the last two or three days, there have been gigantic amounts of financial resources that have been transferred between countries as well as many selling operations in the stock markets. Financial assets owned by Russian entities have been moved out of American and European banks and transferred to what they consider to be safer havens. In addition, EU banks and funds have taken way from Russia many of their financial investments. There is a move away from the Russian currency, the rouble.

All this is precautionary. But it sends a very strong message, including to Vladimir Putin, that today´s economic and financial interdependence does require a different approach to conflict between major states. Diplomacy and compromise are more in line with today´s interests. 

Global America

President Obama’s address, this afternoon, about the health coverage initiative and the shutdown of government services, will certainly have an important impact on American public opinion. The finger pointing at the Republicans was very effective. I think it is the right approach. The pressure on the Republican Party should convince its leaders that it is in their electoral interest to find a way out of the current crisis. The sooner they do it the better as the continued shutdown will end up by having a major impact on the economy both in the US and elsewhere. Today’s world is too interconnected for us, Europeans, to say this is a mere American issue. It is not. We will end up by being concerned as well.  

Challenging the welfare state

Willem-Alexander, who has recently been inaugurated as King of the Netherlands, addressed Parliament for the first time. In his speech he announced that the Dutch welfare system is no longer sustainable. And he linked his statement to the globalisation and the ageing population.  He could also have mentioned the serious public account deficit the country is confronted with.

I suspect this statement will be quoted often in the near future.

In the meantime, on the same occasion, a friend of mine, an American lawyer well known in some circles, reminded me that in the US the age group that is growing faster, in proportional terms, is the one concerning the people aged 95 and plus.

Globalization needs public debate

As the discussions on a free trade agreement with the US get – painfully – off the ground, I notice growing opposition in many segments of the EU public opinion against anything that might look like opening new doors to globalization. It is not just the workers’ movements, or the small entrepreneurs, or people from the left or the centre-left. The opposition also comes from heads of larger firms and others that know the world and have very much benefitted from the opening of the borders. It is also now the key feature within the nationalist groups.

The debate about globalization has lost objectivity. Everything is now about fears, vested interests, and protection from outside competition.  Those who should explain the advantages of a more open world market and how to operate in tomorrow’s global economy have preferred to remain silent. To do so is to give space to all kinds of populist views and to encourage retrograde politics to take over. It is, in my opinion, a dangerous withdrawal.  

The baby and the UK economy

Looking at the TV pictures on the Royal Baby, and seeing the crowds and the fever in the national media, I can only say to myself that the British will never stop amazing me.  Then, I look at the Financial Times and find there a very serious assessment of the baby’s impact on the economy. Great Britain, indeed!

Alentejo, a Province in Southern Portugal

As I drove over the vast expanses of land that make Alentejo, the Southern Province of Portugal, I thought that all those, all over the world, that are interested in investing in commercial agriculture, food production, biofuels, exotic fruits, should consider visiting the region. There is so much farming land available there, just waiting for capital investment and technology. And the weather, on top of it, is not bad at all. 

Eastern Europe's commerce

During my recent road trips in the Benelux, I have seen a very visible increase of Baltic, mainly from Latvia, and other Eastern European trucks, ferrying all kinds of goods left and right. This is certainly good news. The greater the economic inter-dependency the better it is for Europe.  

On conflicts

Today’s conflicts are complex and asymmetric, thus no crisis can be resolved through a linear approach, with a single silver bullet. Complexity calls for multidimensional responses that should combine military, political and civil instruments. But there is an additional challenge when there are multiple actors responding to a conflict: the coherence of the diverse interventions. Coherence is, very often, missing. Also frequently missing is a clear understanding of the political economy of each conflict. What are the economic and business interests that drive a given conflict? From diamonds to columbite-tantalite (Coltan, as it is known in simpler terms), from opium to khat,  from weapons smuggling to access to water and grazing land - the economics of conflict are key determinants and need to be clearly identified.