Wednesday, October 26, 2005

International Migration, Remittances, & The Brain Drain

The World Bank released a timely report this week on the topic of migration and its effects on world development. The study's findings point to a worrying pattern of "brain drain" - In other terms, the flight of skilled middle-class workers who could otherwise help lift their countries out of poverty. Although the exact effects are still not completely understood, there is a growing sense among economists that such migration plays a crucial role in a country's ability to pursue sustainable development.

From the NYT:

The study found that from a quarter to almost half of the college-educated citizens of poor countries like Ghana, Mozambique, Kenya, Uganda and El Salvador lived abroad in an O.E.C.D. country - a fraction that rises to more than 80 percent for Haiti and Jamaica. In contrast, less than 5 percent of the skilled citizens of the powerhouses of the developing world, like India, China, Indonesia and Brazil, live abroad in an O.E.C.D. country.

These patterns suggest that an extensive flight of educated people is damaging many small to medium-size poor countries, while the largest developing countries are better able to weather relatively smaller losses of talent, and even benefit from them when their skilled workers return or invest in their native lands.

Most experts agree that the exodus of skilled workers from poor countries is a symptom of deep economic, social and political problems in their homelands and can prove particularly crippling in much needed professions in health care and education. But some scholars are asking whether the brain drain may also fuel a vicious downward cycle of underdevelopment - and cost poor countries the feisty people with the spark and the ability to resist corruption and incompetent governance.

Devesh Kapur and John McHale argue in their book, "Give Us Your Best and Brightest," published last week by the Center for Global Development, a research group in Washington, that the loss of institution builders - hospital managers, university department heads and political reformers, among others - can help trap countries in poverty. "It's not just the loss of professionals," said Mr. Kapur, an associate professor of government at the University of Texas at Austin. "It's also the loss of a middle class."

"The labor forces in many developed countries are expected to peak around 2010. Conversely, the labor forces in many developing countries are expanding rapidly. This imbalance is likely to create strong demand for workers in developed countries' labor markets, especially for numerous service sectors that can only be supplied locally." - International migration, remittances, and the brain drain, World Bank, 2005.


Friday, October 21, 2005

Lebanon: Report of the Commission Established Pursuant to Security Council Resolution 1595

Published October 19, 2005
Author: Detlev Mehlis


1. The Security Council, by its resolution 1595 of 7 April 2005, decided to establish an international independent investigation Commission based in Lebanon to assist the Lebanese authorities in their investigation of all aspects of the terrorist attack which took place on 14 February 2005 in Beirut that killed former Lebanese Prime Minister Rafik Hariri and others, including to help identify its perpetrators, sponsors, organizers and accomplices.

2. The Secretary-General notified the Council that the Commission began its full operations with effect from 16 June 2005. The Commission was granted an extension to the initial period of investigation mandated by the Council, until 26 October 2005.

3. During the course of its investigation, the Commission received extensive support from the Government of Lebanon and benefited from expert inputs from a number of national and international entities.

4. The main lines of investigation of the Commission focused on the crime scene, technical aspects of the crime, analysis of telephone intercepts, the testimony of more than 500 witnesses and sources, as well as the institutional context in which the crime took place.

5. The full case file of the investigation was transmitted to the Lebanese authorities during October 2005.

6. The present report sets out the main lines of enquiry of the investigation conducted by the Commission, its observations thereon, and its conclusions, for the consideration of the Security Council. It also identifies those matters on which further investigation may be necessary.

7. It is the Commission’s view that the assassination of 14 February 2005 was carried out by a group with an extensive organization and considerable resources and capabilities. The crime had been prepared over the course of several months. For this purpose, the timing and location of Mr. Rafik Hariri’s movements had been monitored and the itineraries of his convoy recorded in detail.

8. Building on the findings of the Commission and Lebanese investigations to date and on the basis of the material and documentary evidence collected, and the leads pursued until now, there is converging evidence pointing at both Lebanese and Syrian involvement in this terrorist act. It is a well known fact that Syrian Military Intelligence had a pervasive presence in Lebanon at the least until the withdrawal of the Syrian forces pursuant to resolution 1559. The former senior security officials of Lebanon were their appointees. Given the infiltration of Lebanese institutions and society by the Syrian and Lebanese intelligence services working in tandem, it would be difficult to envisage a scenario whereby such a complex assassination plot could have been carried out without their knowledge.

9. It is the Commission’s conclusion that the continuing investigation should be carried forward by the appropriate Lebanese judicial and security authorities, who have proved during the investigation that with international assistance and support, they can move ahead and at times take the lead in an effective and professional manner. At the same time, the Lebanese authorities should look into all the case’s ramifications including bank transactions. The 14 February explosion needs to be assessed clearly against the sequence of explosions which preceded and followed it, since there could be links between some, if not all, of them.

10. The Commission is therefore of the view that a sustained effort on the part of the international community to establish an assistance and cooperation platform together with the Lebanese authorities in the field of security and justice is essential. This will considerably boost the trust of the Lebanese people in their security system, while building self-confidence in their capabilities.

Download Complete Report

Excerpt from the Report:

Rafik Hariri, taped conversation with Walid Al-Moallem on 1 February 2005:

“In connection with the extension episode, he (President Assad) sent for me and met me for 10 to 15 minutes.”

“He sent for me and told me: “ You always say that you are with Syria. Now the time has come for you to prove whether you meant what you said or otherwise.” (…) He did not ask my opinion. He said: “I have decided.” He did not address me as Prime Minister or as Rafik or anything of that kind. He just said: “I have decided.” I was totally flustered, at a loss. That was the worst day of my life.”

“He did not tell me that he wished to extend Lahoud’s mandate. All he said was “I have decided to do this, don’t answer me, think and come back to me.””

“I was not treated as a friend or an acquaintance. No. I was asked: “Are you with us or against us?” That was it. When I finished my meeting with him, I swear to you, my body guard looked at me and asked why I was pale-faced”

Saturday, October 01, 2005

Global Competitiveness Report

Global Competitiveness Report 2005-2006 (Click for Report)

Europe's largest economies – Germany, the U.K., France, Italy, and Spain – are all losing ground in an annual survey on global competitiveness, dragged down by concerns of sluggish economic growth and high budget deficits.

The rankings, published by the Geneva-based World Economic Forum, pit Italy and Poland as the least competitive members of the European Union. Italy has slipped steadily to 47th of the 117 nations measured this year from 26th in 2001. Italy is burdened by perceptions that its government is interfering in the private sector, as recently alleged in the Bank of Italy's intervention in banking mergers. Finland for the third consecutive year and the U.S. for a second straight year, respectively, once again top the international organization's list of most competitive economies in the annual survey, though the U.S.'s image is tarnished by the health of an economy posting large budget deficits and near-record trade deficits.

Along with Finland, the Nordic European countries of Sweden, Denmark, Iceland and Norway hold five of the top 10 spots, as they did last year.Other stars include Taiwan and Singapore, ranking fifth and sixth, respectively, ahead of 12-seated Japan, which is still suffering from years of deflation.

China and India, often cited as the greatest competitive threats to western economies as they flood markets with cheap products and labor, ranked 49th and 50th. Despite their high growth rates in recent years, the survey found that both countries need to cut red tape, educate their people and improve infrastructure in order to continue to compete in the years ahead.

The World Economic Forum defines competitiveness not just on the basis of productivity and exchange rates. It also looks at policies and institutions that can affect productivity and prosperity.

Western Europe's slip in competitiveness from the beginning of the decade – though from fairly high levels -- reflects the region's economic development of late. Gross domestic product in the 12-nation euro zone that forms the bulk of the region's economy is projected to have expanded on average at just 1.3% during the first five years of this decade, compared with more than 2% during the previous decade. The euro zone is forecast to grow just 1.2% this year, behind 3.5% growth in the U.S. and 4.3% growth globally, according to recent forecasts by the International Monetary Fund. The region's budget deficit has risen to 2.7% of GDP in 2004 from 1.9% of GDP in 2001.

The United Kingdom slipped to 13th place from 11th last year; Germany to 15 from 13; and France to 30 from 27. The dimmer outlook for nations such as Germany and France, which the IMF expects to grow this year 0.8% and 1.5%, respectively, is even beginning to harm the outlook for relatively robust Spain, which has been one of the euro zone's fastest growing economies in recent years. Spain's overall ranking dropped to 29 from 23, and the indicator ranking Spain's economic outlook has dropped to 65 this year from 29 in 2001.

Country Rankings (World):

1. Finland 2. USA 3. Sweden
4. Denmark 5. Taiwan 6. Singapore
7. Iceland 8. Switzerland 9. Norway
10. Australia 11. Netherlands 12. Japan
13. UK 14. Canada 15. Germany
16. New Zealand

The Arab World Competitiveness Report 2005 (Click for Report)

The Arab world finds itself at a critical crossroads.Population growth has pushed unemployment rates to some of the highest levels in the world, and brought into sharp relief the urgent need for a reorientation of economic policies. Reforms are essential to engender a process of sustained job creation, well into the next decade, if the region is to avoid the inefficiencies associated with poor utilization of human resources, to say nothing of the social and political costs.

The call for urgent action is underscored not only by the burgeoning pressures on labor markets, but also the resurgence of other major emerging economies—in China, India, and central and eastern Europe, to name a few—whose presence in the global economy is quickly expanding, against a background of sustained improvements in per capita incomes, institutional development and international competitiveness.

To remain viable in the global economy in areas other than the energy sector, it is vitally important that the Arab countries improve the overall quality of governance, significantly raise their levels of competitiveness, improve macroeconomic management, institute reforms to enhance the efficiency of public sector institutions and, facilitate the absorption of new technologies.

Country Rankings (Arab World):

1. Qatar 2. UAE 3. Bahrain
4. Oman 5. Jordan 6. Tunisia
7. Saudi Arabia 8. Morocco 9. Egypt
10. Algeria 11. Lebanon 12. Yemen