‘Financial globalisation can reinforce Islamic finance’

KARACHI: Dr Shamshad Akhtar, Governor, State Bank of Pakistan (SBP), has said the Islamic financial services industry needs to consolidate itself to be able to better compete with global players through achieving scale efficiency and cost effectiveness in addition to rapidly building its capacities to standardise regulation, supervision and accounting practices, while strengthening the governance of the industry.

Delivering her keynote address as the Chairperson of the Islamic Financial Services Board (IFSB) on “Financial Globalization and Islamic Financial Services Industry” at the 5th Annual Summit of the IFSB held in Amman, Jordan, Dr Akhtar said the Islamic financial services industry has been transformed from being a peripheral activity to a sizeable industry which is attracting global interest.

She said financial globalization would foster this industry and given the inherent features and richness of Islamic principles, modalities and products’ growth, it would be beneficial for supporting the process of regional and global financial deepening. Although currently the size of the industry is small relative to the global financial system, it has promising growth prospects, she added.

Introducing basic social protection in low-income countries: lessons from existing programmes

Authors: Barrientos,A.Produced by: Brooks World Poverty Institute, University of Manchester (2007)

This paper reviews tax-financed social assistance through transfers in kind or cash in low-income countries. Such assistance is often constrained by path dependence at a micro level due to fragmentation of programmes and the presence of attached constituencies. Important factors for the sustainability of social protection programmes are:

<political support or at least the absence of significant opposition -often induced by exogenous factors such as the intervention of donors and NGOs, cross-national policy transfers led by donors and regional bodies domestic policy learning.

perceived opposition to government policies or social unrest urging policy makers to counteract;Social protection can contribute to the development process by:

reducing poverty and associated costs

helping overcome inefficiencies associated with missing or imperfect markets

facilitating investment in human capital

lifting cash and credit constraints

protecting people and assets against sudden or random hazards

 

However, there is only limited evidence regarding the quality and strength of these effects. Local economy multiplier effects have not been proved, but there is also no sign of rising prices induced by social assistance. This is likely to be due to the programmes’ very low level of coverage.

Financing is a key constraint on the development of social protection. Most programmes are financed by donors, which however, exhibit a preference for short-term aid. This leaves national governments in low-income countries with worries about medium and long term fiscal liabilities and strategic positioning vis-…-vis donors. The medium and long run sustainability of social protection programmes will therefore rely on the tax collection capacity of domestic governments.

Available online at: http://www.eldis.org/cf/rdr/?doc=36894

Aid makes us feel good, but how about real commitment?

Daniel Flitton

Ignoring suffering is impossible, so is thinking there is a quick fix.

BORDERS between countries are often inconvenient — ask any tourist trying to negotiate minefields associated with passports and visas. But for some people, closed borders are literally matters of life and death. After the ravaging impact of cyclone Nargis in Burma last week, the world is again confronted with a dilemma. Just how much respect does a political line on the map actually deserve?

The argument is about responsibility, or rather, its limits. When massive numbers of people suffer in another country, beyond the boundary of our control, does the world community have a moral obligation to act in response to tragedy? And what happens if local authorities resist outside help?

Knowing the dismal record of Burma’s military rulers, a chorus of capitals across the globe — from Washington to Paris and Canberra — has pleaded with the regime to throw open the borders to foreign assistance.

The signs are far from encouraging. Barely a trickle of aid has made it through and some food shipments have been hijacked by the regime for the generals to put a personal stamp on aid distribution.

The junta is famously paranoid. Over the coming months, it’s safe to expect those aid groups able to negotiate a role in the recovery effort will complain that their work is being hampered by official interference. The regime may even abruptly demand the outsiders leave, especially if any private Western organisation is seen to be doing its government’s bidding.

Such a move would hardly be without precedent. The principle of a country’s sovereign independence is still fiercely guarded in many areas where the memory of colonial rule is barely a generation past. Soon after the 2004 Indian Ocean tsunami, Indonesia’s leaders demanded all foreign military forces leave Aceh inside three months. India stubbornly refused any international assistance at all.

The Global Food Crisis…and the Ravenous System of Capitalism

Courtesy this site

As Josette Sheeran of the UN World Food Program put it last month, “We are seeing food on the shelves but people being unable to afford it.” That’s a situation in which people start to question the very property relations that stand between them and those sacks of rice and bags of beans piled up behind that storefront grill and the riot policemen in front of it.⁴

—Tony Karon, writer for Time.com, April 9, 2008

The beginning of April 2008 witnessed an explosion of “food riots” around the world.

In Haiti, thousands protested for days throughout the country. In the capital city of Port-au-Prince, people carried empty plates to signify their hunger and smashed windows, set buildings and cars on fire, looted shops looking for food, and tried to storm the presidential palace. UN Blue Helmets (MINUSTAH) shot and killed at least five Haitians and wounded many others. In Bangladesh, many workers earn only $25 a month and the price of rice has doubled over the past year. 20,000 textile workers took to the streets to demand higher wages and to protest rising food prices. Scores were injured when police used gunfire to disperse the crowds.

In Egypt, when workers protested food prices in the textile center of Mahalla al-Kobra, north of Cairo, security forces shot dead two people and hundreds were arrested. In Burkina Faso in West Africa, unions and shopkeepers went on strike for two days to demand a cut in the price of rice and other staples. In Phnom Penh, Cambodia—where the average income is 50 cents a day and the cost of a kilogram of rice has risen to $1—demonstrators marched on parliament to protest food price hikes. In the Ivory Coast, where food prices have soared by between 30 percent and 60 percent from one week to the next, thousands marched on the home of President Laurent Gbagbo, chanting “We are hungry” and “Life is too expensive, you are going to kill us.” Over a dozen protestors were injured when police attacked the crowd with tear gas and batons.

PAKISTAN: Literacy ratio still at 50 percent

“Literacy ratio in Pakistan still remains at 50 percent, mainly because of small budgetary allocations, lack of political will and delays in disbursement of funds, according to Unesco. In the region, Pakistan has been ranked higher only than Nepal and Bangladesh, which have literacy rates of 49 and 43 percent, respectively. Other countries have far better ratios: the Maldives, 96 percent; Sri Lanka, 91 percent; and India, 61 percent.

Sindh has the highest percentage in education which stands at 54 percent followed by Punjab (52 percent) and the NWFP (40 percent). Balochistan has the lowest ratio — 33 percent. Unesco attributed the low level of literacy rate to factors like weak organizational infrastructure, low professional capacity, lack of research, non-availability of proper training institutes, low public awareness and lack of evaluation and monitoring system.”

Source: muslimnews.co.uk - full story here

Pakistan: 5.6 million mobile subscribers added in 2008

By Romail Kenneth

KARACHI: In the first three months of 2008 more than 5.6 million mobile subscribers were added, registering an increase of 6.82 percent. Figures released by Pakistan Telecommunication Authority (PTA) show.

Total number of subscribers now stands at 82 million with a mobile density of 52.16. In December 2007, the mobile phone subscribers stood at 76.88 million.

Ufone retained its second position with 17.19 million subscribers followed by Telenor with 16.70 million subscribers. Mobilink is still leading the market with 31.75 million subscribers, while Warid stands on fourth position with 14.39 million subscribers.

China Mobile lost growth in terms of subscribers, but according to industry analysts, after the launch of Zong the next month figures are expected to be positive.

Food crisis, food justice, food relationships

This article by Ornaith O’Dowd, NYC found at Interventions blog is revealing

We are in the midst of a global food crisis the likes of which we have not seen in at least a generation. Such is the official consensus, from the UN to the corporate media. We have heard appeals for increased food aid from humanitarian organizations; we have heard of unrest in over thirty countries as a result of soaring food prices. There are dark mutterings of political destabilization, even revolution. Already one head of government, Haiti’s Prime Minister, has been turfed out of office as people protest the growing gap between their incomes and the price of food. Others are surely feeling uneasy.

Commentators have reached a broad consensus about the causes: rising oil prices, increased ethanol production, more people in India and China adopting Western food consumption habits (such as eating a lot of meat and a lot of processed foods), extreme weather events (such as the Australian drought, arguably caused by global warming). Major producers from Argentina to Vietnam have restricted exports, further tightening supply.

Two other factors are relevant, but somewhat less widely mentioned: the effect of large-scale speculation in commodities markets (see here, and the effects of neoliberal trade “reforms” dictated to poorer countries by international financial institutions (IFIs) like the IMF and World Bank (see here). As speculators have helped drive prices up, poor countries whose food production base was destroyed by trade “liberalization” are left dependent on ever more expensive food imports.

Who are the winners? Predictably, major transnational corporations– and not only in the food/ agribusiness sector (the recent good news for big oil being the most obvious example).

More here

Innovative slum dwellers ignored in redevelopment plan

“Dharavi, one of Asia’s largest slums, is known for its remarkable entrepreneurial spirit and flourishing economy. Its annual turnover is estimated at anywhere between $700 million and $1 billion. For all its drawbacks, in a city where rents are among the highest in the world, Dharavi offers a roof over heads for a rent as low as $4 per month. The Dharavi Redevelopment Project was first conceived in 1995. It took the government eight years to give the go-ahead and in June last year it invited bids to execute the $2.3 billion project.

Agricultural corporations boast huge profits in midst of food crisis

By Naomi Spencer

As inflation and shortages expose billions to hunger worldwide, agricultural giant Archer-Daniels-Midland Company revealed a 42 percent leap in quarterly profits. The announcement follows similarly skyrocketing earnings reports from half a dozen other agribusinesses and suppliers, as well as from major oil companies BP, Shell, and Exxon.

For the third fiscal quarter ending March 31, ADM reported $517 million in profit. In an April 29 conference call, executives attributed record earnings throughout all of the company’s operations to an enormous increase in speculative activity in commodities markets.

“Volatility in commodity markets presented unprecedented opportunities,” ADM chief executive Patricia Woertz told investor analysts in on the call. “Once again, our team leveraged our financial flexibility and global asset base to capture those opportunities to deliver shareholder value.”

Commodities markets have been flooded with investors from out of the credit and housing markets looking for more sound sources of profit. As a result, the grain, metals and oil markets have been subject to rampant turnover of stocks and huge fluctuations in the valuation of the most basic goods.

Blogging for governance: on countries and governments

Kauffman writes on here on blogging and its importance for making governments and their actions more transparent and accountable to their citizens….

 Notwithstanding the reality that the positive impact of blogs to promote improved accountability, governance and transparency far outweigh some of its negatives, the question of when blogging does cross the line cannot be begged — and figuring out what is the appropriate response when such line is crossed.  Does the (demand-driven) market test suffice and the more responsible blogs end up dominating, so that the system is self-correcting?  Or, to fend off unwarranted calls for outright ban (or closing down of sites), editorial accountability or some degree of filtering is at times needed?