Category: Economics

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Economics Environment Science & technology

[565] Of spurious carbon emission reporting?

I’ve just read a piece written by Beth Romulo and published by Philippines-based Manila Bulletin Online regarding the new Asia-Pacific Partnership for Clean Development and Climate.

I have no problem with the article save one point:

The new agreement is not intended to replace the Kyoto protocol, Deputy Secretary of State Robert Zoellick explained, when the agreement was announced, but to complement it, by bringing in the developing countries, and offering them the most modern technology to help lower emissions. Despite the fact that the US did not ratify the Kyoto pact, it has proceeded voluntarily and been able to reduce carbon dioxide emissions by 0.3 percent while the EU’s 25 members have increased to 3.4 percent.

Wow. According to him, the US has been able to reduce carbon emission by 0.3%. Moreover , that sentence that touches on US vs. EU emission is written as weaselly as it could be written.

Why is it spurious?

The author says that there is a drop but fails to give the time frame. Is it year to year basis? Is it 2005 against 1990?

According to BBC, “the US carbon dioxide emissions have increased to more than 15% above 1990 levels.” Moreover, Washington Post says the US 2004 emission level has increased by 1.7%.

I could give him a benefit of a doubt and assume he meant a reduction for the year 2005 (despite that there are 5 more months before the year ends). However, mind you at the same time that the US targets 18% reduction in emission intensity, not reduction of 18% of emission level. There is a huge different in intensity and level and this is where the US has been able to do. The US has been able to reduce the intensity and I think the author of the article us confused with the two terms.

More about emission intensity from the same article by Washington Post:

Connaughton, the chairman of the Council on Environmental Quality, and other administration officials said they are focused on obtaining practical commitments industrialized countries can meet without damaging their economies. He said that although some G-8 countries are struggling to meet their goal of bringing greenhouse gas emissions down to 1990 levels by 2012, the United States is on track to fulfill its pledge to reduce its carbon intensity — how much emissions are rising relative to overall economic growth — 18 percent by 2012.

On Thursday, the Energy Information Administration announced that the nation’s carbon emissions rose 1.7 percent in 2004 — but that amounted to a 2.6 percent drop in carbon intensity, because the U.S. economy grew 4.4 percent that year. The rate of increase in U.S. carbon emissions more than doubled from 2003 to 2004 because of heightened economic activity.

Now, I’m not saying reducing in emission intensity undesireble. Quite the contrary, any reduction is good to me. But this Beth Romulo needs to recognize which is which or else, misinformation might be spread out whenever he writes anything about greenhouse gases emission.

Categories
ASEAN Economics Environment

[561] Of haze and the need to invade Indonesia

There was one time when I could see the Petronas Twin Towers clearly from my home in Kuala Lumpur. At the moment however, the view is kind of hazy, no thanks to Indonesia.

In ASEAN, there is a treaty known as Agreement on Transboundary Haze Pollution (pdf). Basically, it encourages parties of the treaty to cooperate with each other in combating haze. As of August 2005, seven ASEAN members have ratified the agreement. They are Brunei, Laos, Malaysia, Myanmar, Singapore, Thailand and Vietnam. It is, however too bad that none of the parties is a major contributor to the – the one prime source of this haze, Indonesia, has yet to ratify the treaty.

ASEAN members need to pressure Indonesia into signing this treaty. Forget about Myanmar’s progress towards democracy for awhile. I don’t think Malaysians and indeed Singaporeans should care for Myanmar if we all are going to choke ourselves to death with Indonesian smog. We should criticize Indonesia first and Myanmar second unless Myanmar somehow gets some sort of nuclear warhead from North Korea.

ASEAN politicians have praised Indonesia for reducing open burning in Sumatra. But surely, praise or no praise, Indonesia is not doing enough. ASEAN’s worst haze happened in 1998 and since then, several ASEAN members have themselves covered by smog yearly. More needs to be done and Indonesia’s ratification of the transboundary haze pollution treaty is a great jumpstart towards improving the air quality in Southeast Asia.

If Indonesia lacks the resources needed to implement enforcement against open burning, I’m sure Malaysia and Singapore and even Brunei could offer assistance in term of manpower and monetary aid.

If nothing could convince Indonesia to tie up its shoelaces, then Malaysia and Singapore should team up and invade Indonesia, divide Sumatra among themselves and solve this haze problem once and for all.

Or, we, about 25 million Malaysians plus a couple millions of Singaporeans could together take a deep breath and blow the haze towards Jakarta. Let’s see if they like their own shit.

Or the Malaysian government could build fat ass fans that could redirect the haze towards Jakarta. Or at least until all the haze reaches Singapore… err, I mean Indonesia.

God, this haze thing is driving me nut.

p/s – Oh, if you are reading this David, don’t let Monika read this. Else, the grand scheme to grab Sumatra would fail!

pp/s – I’m moving to a new host soon. So, please bookmark www.maddruid.com instead of my current url.

Categories
Economics Environment

[559] Of King Kong vs. Godzilla

When I was taking labor economic last year, my professor presented a case in class concerning monopsony meeting monopoly and dubbed it, in theory, it’s like King Kong versus Godzilla. I bursted into laughter immediately.

In retropect, I’m not sure whether I laughed because of his figurative presentation, or the truth behind it.

In the real world, the war between a real King Kong and Godzilla has begun; Microsoft versus Google. Of course, none of them are monopsonies but both of them are monopolies. They do hold considerable market power to themselves.

SEATTLE – In a simmering legal tussle, Google Inc. is asking a judge to reject Microsoft’s bid to keep a prized research engineer from taking a job at the Internet search company, saying the software titan filed its lawsuit to frighten other workers from defecting.

Anyway, some sort of climate change agreement between the US and five other Pacific rim nations have been signed prior to ASEAN + 3 + Australia + New Zealand meeting in Laos.

WASHINGTON – The United States and five Asian and Pacific nations, including China and India, agreed Wednesday on a partnership to use cleaner energy technologies in hopes of curtailing climate-changing pollution.

The goal is noble but the problem is, this agreement is non-binding. Because it is non-binding, I suspect there will be freerider problem – which hardly solve Kyoto’s flaw to start with.

With Kyoto, all non-Annex 1 members, including China and India, are not binded to emission reduction and hence, freeriding others’ effort to combat climate change.

Categories
Economics

[551] Of Ringgit unpegged!

I’m going to exchange all the dollar I have left to ringgit right now. From Bank Negara:

Bank Negara Malaysia announces today that the exchange rate of the ringgit with immediate effect will be allowed to operate in a managed float, with its value being determined by economic fundamentals. Bank Negara Malaysia will monitor the exchange rate against a currency basket to ensure that the exchange rate remains close to its fair value. Promoting stability of the exchange rate continues to be a primary objective of policy.

And wow, we didn’t wait for China.

p/s – I’ve just found out that China has ditched their fixed regime in favor of flexible exchange rate. This can only one thing – the rumor that the Malaysian government did send a team to China for consultation purposes is true. It must be true since it is almost impossible for both Malaysia and China to simultaneously switch to floating exchange rate.

About less than a year ago, I read somewhere that the Ringgit should be approximately between MYR 3.20 and 3.50 to a dollar. Let’s see if people in the economic circle have made the right prediction.

I’m sure that whiny and bitchy US manufacturers are happy with today’s development. China right now, however, I think, has a strong incentive to reduce its holding of US T-Bills.

Categories
Economics Environment Politics & government

[550] Of US – India nuclear cooperation

I saw Manmohan Singh’s address to the US Congress yesterday. In his speech, he asserted how important it is for the US and India to work together in a globalized world. In actuality, he seeks the Congress’ consent for the US cooperation with India on India’s nuclear work for civilian purposes. I for one, hope the Congress won’t block any step taken towards that direction.

Chernobyl was a tragedy. So was Three Mile Island incident. However, with growing human population, it is obvious that we will consume more and more power. Unfortunately, that power has to come from somewhere, be it from fossil fuel, green energy or nuclear.

The Indian Prime Minister mentioned yesterday that in any scenario, coal plays a central role in India energy industry. India is a huge country and their reliance on coal would increase carbon emission tremendously all the while the Annex 1 parties to Kyoto are struggling to reduce emission. With or without China and the United States, India could single-handedly wreck the fight against climate change. Nuclear provides a clear alternative to coal while clean and safe renewable sources, at its current state, are simply not enough to quench India and indeed the world’s thirst for energy,

The US has refused to ratify Kyoto and has stubbornly argued that any reduction in emission would damage its economy. Moreover, Bush and his supporters have said that only technological progress is the answer to climate change. Frankly, I’ve yet to see or hear Bush do something about that but now is the time to back that claim up. Now is time to prove that Bush really belief that instead of simply trying to dodge a commitment that the US made under the Clinton Administration. Congress now needs to approve such cooperation to give Bush’s words a spine.

Some fear that this might encourage nuclear proliferation. This groups need to be reminded that India already has nuclear capability. In fact, in my opinion, the US cooperation with India would make nuclear energy safer.

Perhaps, if others still feel strongly against such cooperation, perhaps US offer assistance on a condition that India will sign the Nuclear Non-Proliferation Treaty, which India is not a signatory. With India in the NPT, the world might even be able to persuade Pakistan to sign the treaty. Of course, there will have to be a change in the first pillar of the NPT.

In the end, wouldn’t that make the world a bit safer?

On the other side, a lot of people are saying that this new American relationship with India spurs out of concern of China’s growing power. Well, I prefer to some something to counter China’s regional influence – Japan simply can’t counter China alone.

p/s – Michigan is currently second in the ASC and they are closing in on the leader, Minnesota, fast. MIT and Missouri-Rolla is far behind.