Author: Hafiz Noor Shams

For more about me, please read this.

Categories
Conflict & disaster

[1164] Of North Korea versus Islamic Courts Union?

Interesting fact:

WASHINGTON, April 7 — Three months after the United States successfully pressed the United Nations to impose strict sanctions on North Korea because of the country’s nuclear test, Bush administration officials allowed Ethiopia to complete a secret arms purchase from the North, in what appears to be a violation of the restrictions, according to senior American officials.

The United States allowed the arms delivery to go through in January in part because Ethiopia was in the midst of a military offensive against Islamic militias inside Somalia, a campaign that aided the American policy of combating religious extremists in the Horn of Africa. [North Koreans Arm Ethiopians as U.S. Assents. NYT. April 8 2007]

Other salient points:

American officials said that they were still encouraging Ethiopia to wean itself from its longstanding reliance on North Korea for cheap Soviet-era military equipment to supply its armed forces and that Ethiopian officials appeared receptive. But the arms deal is an example of the compromises that result from the clash of two foreign policy absolutes: the Bush administration’s commitment to fighting Islamic radicalism and its effort to starve the North Korean government of money it could use to build up its nuclear weapons program.

[…]

Several officials said they first learned that Ethiopia planned to receive a delivery of military cargo from North Korea when the country’s government alerted the American Embassy in Addis Ababa, Ethiopia’s capital, after the adoption on Oct. 14 of the United Nations Security Council measure imposing sanctions.

“The Ethiopians came back to us and said, ‘Look, we know we need to transition to different customers, but we just can’t do that overnight,’ ” said one American official, who added that the issue had been handled properly. “They pledged to work with us at the most senior levels.”

[…]

The measure had special relevance for several African states that have long purchased low-cost military equipment from North Korea. Ethiopia has an arsenal of T-55 tanks that it acquired years ago from the Soviet Union and Eastern European nations. For years, it has turned to North Korea for tank parts and other equipment to keep its military running.

The Ethiopians bought the equipment at a bargain price; the North Koreans received some badly needed cash. In 2005, the Bush administration told Ethiopia and other African nations that it wanted them to phase out their purchases from North Korea. But the Security Council resolution put an international imprimatur on the earlier American request, and the administration sought to reinforce the message.

[…]

It is not clear if the United States ever reported the arms shipment to the Security Council. But because the intelligence reports indicated that the cargo was likely to have included tank parts, some Pentagon officials described the shipment as an unambiguous Security Council violation. [North Koreans Arm Ethiopians as U.S. Assents. NYT. April 8 2007]

Would we be seeing radical Islamists targeting North Korea in the future?

Categories
Economics

[1163] Of blog war between DeLong, The Street Light and Free Debate

Economists are taking sides. It starts at The Economist:

Despite a dispiriting start that saw the imposition of steel tariffs, the Bush administration has made great efforts on trade, pushing forward with both multilateral and bilateral deals. Its biggest goal, a substantive deal from the Doha round of World Trade Organisation negotiations, is currently on life support. But the administration has managed to secure a variety of smaller deals, while letting steel tariffs die a death at the hands of the WTO. Now even progress of that sort may end. [Trouble with trade. April 2 2007. The Economist]

The Street Light fires the first shot:

The Economist takes a massive dive today, as they continue to bizarrely and irresponsibly assume the best (or maybe “the least bad” would be more accurate) of the Bush administration. [The Economist on Bush on Trade. April 2 2007. The Street Light.]

The DeLong as reinforcement:

Kash Mansouri writes… [Kash Mansouri Is Very Unhappy with the Economist on Bush on Trade. April 3 2007. Grasping Reality with Both Hands]

Free Debate, the blog of the Economist, counterattacks:

BRAD DE LONG approvingly links Kash Mansouri, as he goes after us for claiming that the Bush administration has been relatively strong on free trade issues…

[…]

Despite the good professor’s endorsement, this take on the Bush administration’s trade policy is an implausibly uncharitable reading. I confess I am stonkered at the willingness to blame the Bush administration for being insufficiently active on Doha, since without the trade team’s efforts, Doha would not be on life support; it would be dead. The Bush administration did everything but a fan dance to lure all parties back to the table after the catastrophe at Cancun, and while it has not gone as far on farm subsidies as anyone would like, this is widely regarded as driven by (Democratic and Republican) farm interests in Congress, not some failure on the administration’s part. It does the administration no good to negotiate a treaty that can’t be signed.

[…]

The Bush administration is far from perfect on trade; I think particularly of its ridiculous stance on sugar ethanol. But the Bush administration is constrained by political realities. It has failed to take many damaging steps despite intense political pressure, such as declaring China a currency manipulator, and where it does impose anti-trade measures, they are pleasingly often something like the steel tariffs, which were guaranteed to be overruled by the WTO. And as Mr DeLong’s commenters point out, whatever Mr Bush’s trade sins, they are at this point thoroughly overshadowed by the Democratic protectionists currently flexing their muscles in the House. That’s less an endorsement of the Bush administration than a sad comment on the state of trade policy in the world today: the Bush administration is the best we’ve got. [Tu quoque. April 3 2007. Free Debate]

Would Mankiw and Krugman (or heh, by proxy, Mark Thoma) get a keg and make a merrier party?

Categories
Environment Science & technology

[1162] Of the second part of the AR4

The second part of the Fourth Assessment Report by the Intergovernmental Panel on Climate Change has been released, two months after the first part was published.

In the associated Summary for Policymaker report (SPM):

  • Observational evidence from all continents and most oceans shows that many natural systems are being affected by regional climate changes, particularly temperature increases. (Page 2)
  • A global assessment of data since 1970 has shown it is likely6 that anthropogenic warming has had a discernible influence on many physical and biological systems. (Page 3)
  • Other effects of regional climate changes on natural and human environments are emerging, although many are difficult to discern due to adaptation and non-climatic drivers. (Page 4)

What we know on anthropogenic climate change?

  • More specific information is now available across a wide range of systems and sectors concerning the nature of future impacts, including for some fields not covered in previous assessments. (Page 7)
  • More specific information is now available across the regions of the world concerning the nature of future impacts, including for some places not covered in previous assessments. (Page 10)
  • Magnitudes of impact can now be estimated more systematically for a range of possible increases in global average temperature. (Page 14)
  • Impacts due to altered frequencies and intensities of extreme weather, climate, and sea level events are very likely to change. (Page 16)
  • Some large-scale climate events have the potential to cause very large impacts, especially after the 21st century. (Page 17)

About our possible response to anthropogenic climate change:

  • Some adaptation is occurring now, to observed and projected future climate change, but on a limited basis. (Page 18)
  • Adaptation will be necessary to address impacts resulting from the warming which is already unavoidable due to past emissions. (Page 18)
  • A wide array of adaptation options is available, but more extensive adaptation than is currently occurring is required to reduce vulnerability to future climate change. There are barriers, limits and costs, but these are not fully understood. (Page 18)
  • Vulnerability to climate change can be exacerbated by the presence of other stresses. (Page 19)
  • Future vulnerability depends not only on climate change but also on development pathway. (Page 19)
  • Sustainable development can reduce vulnerability to climate change, and climate change could impede nations’ abilities to achieve sustainable development pathways. (Page 19)
  • Many impacts can be avoided, reduced or delayed by mitigation. (Page 20)
  • A portfolio of adaptation and mitigation measures can diminish the risks associated with climate change. (Page 20)
  • Impacts of climate change will vary regionally but, aggregated and discounted to the present, they are very likely to impose net annual costs which will increase over time as global temperatures increase. (Page 20)

In the report, the media seems to be zeroing on one point: the winners and losers of climate change. The esteemed NYT has a great graphics on the matter. The BBC has produced another graphics describing the effects of climate change all over the world. At the BBC:

The supply of water is very likely to increase at higher latitudes and in some wet tropics, including populous areas in east and southeast Asia. It is very likely to decrease over much of the mid-latitudes and dry tropics, which are presently water-stressed areas. [Climate change around the world. BBC News. April 6 2007]

From the SPM itself:

Copyrights by the IPCC. Fair use.

Copyrights by the IPCC. Fair use.

For more legend, read the part 2 of the AR4.

In January in the aftermath of New Orleans of Malaysia, the government promised a report of climate change. Where is that report now, I wonder?

Categories
Economics

[1161] Of why Malaysia is the center of Islamic banking

From the Wall Street Journal, via the Free Debate at the Economist:

Six years ago, a Malaysian bank asked 80 financial institutions in the Persian Gulf for help in selling a corporate bond that complied with Islamic prohibitions on interest.

All but one declined to participate, branding the novel security “haram,” or banned by Islam. Just a few months after the $150 million offering proved a success, however, many of these doubters shelved their theological qualms and came up with similar Islamic bonds of their own.

The global Islamic bond market that has developed since then is now worth an estimated $50 billion in securities outstanding, part of a burgeoning Islamic financial industry that’s fast approaching $1 trillion in assets. The torrents of cash that fuel this boom mostly come from the Persian Gulf’s oil bonanza. But it is distant Malaysia, thousands of miles to the east, that has emerged as the industry’s unlikely trailblazer.

“Malaysia is the catalyst for change,” says Faiz Azmi, Kuala Lumpur-based global head of Islamic finance at PricewaterhouseCoopers, the accounting and consulting firm. Much of what is now considered conventional in the industry, he explains, was test-driven here first — often against the objections of conservative clerics in places like Saudi Arabia. Now such innovations are not just commonplace in the Gulf, but also have become an important revenue source for Western financial giants with Islamic-banking divisions, such as Citigroup Inc. and HSBC Holdings PLC. [Malaysia Transforms Rules For Finance Under Islam. Wall Street Journal. April 4 2007]

I remember religious conservatives claiming that the stock market is haram as well.

Categories
Economics

[1160] Of why the Chinese economy will not be Malaysia’s savior in 2007

For those that read this blog, perhaps you have taken notice that I expect the Malaysian economy to take a dent this year. This is based on expectations that the US economy might experience an economy slowdown later in this year. With a slowdown in the US, demand for Malaysian goods in the US should go down. With worrying data on sub-prime mortgages, I do think the probability is little bit higher than otherwise. There are those that disagree with that prediction. One of the reasons cited to rebuke my prediction is the booming Chinese economy. I would like to prove how the Chinese economy, while important to the Malaysian export sector, is not as nearly as important as the US market.

Firstly, in 2006, the worth of Malaysian export to the US was approximately RM111 billion (roughly, USD32 billion). At the same time, export to the People’s Republic of China was less than half of that to the US. It stood at RM43 billion (roughly, USD12 billion). While the amount going to the Chinese market could increase — it increased by about 21% from 2005 — I do not think it is rational to expect the Chinese economy to be as important as the US market in 2007. Further, the given the size of the US economy, if a slowdown does occur, I do not think the Chinese economy will be able to cushion the entire fall in US demands for Malaysian goods. If the Chinese would to become our savior, each dollar fall in export to the US market needs to be compensated by a dollar worth of export to China or more, with all else being equal, of course.

Secondly, the argument that booming Chinese economy will prevent a slowdown in Malaysia ignores the fact that China is a major exporter to the US. The China exports USD288 billion. It has been estimated that 21% of Chinese export goes to the US in 2006; in the same year, about 19% of Malaysian export goes to the US. Needless to say, a US slowdown will affect China. Therefore, I doubt the Chinese would be our savior.

There are of course many other economies in this world and the US is just one of them. Yet, we would be digging our own grave if we underestimate the importance of the US economy to Malaysia. So, I hope that would put the booming Chinese economy argument to rest.