U.C

Whither 2010?

2010, according to Chinese wisdom, is the year of the metal tiger, one earmarked for tumultuousness by any standards. Hopefully such razzmatazz as the oracles forecast, will remain confined to the electoral and not the cane fields


 

— U.C.

 

As 2009 draws to its close, economic institutions, bankers, brokers, analysts and officials in all countries who have been anxiously poring over the world’s worst financial meltdown, can heave a cautious sigh of relief. Barring unexpected surprises as with the recent Greek spin and its possible damaging repercussions, the signs of a slow recovery in the developed world, whether of U, V or W shape, are creeping in and with them, some degree of rising consumer confidence. This may be solace enough for the countless millions who lost their jobs in the crisis and those aspiring for a start in the labour market, but ordinary taxpayers who footed the bill can remain healthily skeptical whether any lasting lessons have been drawn.

Who can say with some degree of certainty that the perversities of the massive financial dealings in sophisticated products and derivatives have been reined in to any significant extent? Predators have gobbled the failed banks and the system seems set to continue its unbridled course, if the figures being bandied around worldwide for broker bonuses in 2010 are anything to go by. I doubt whether watchdog institutions and fabled credit rating agencies like Moody’s, so prompt to manifest their regal displeasure in smaller foreign countries, have shaken up their act when it comes to large players whose derailment could be far more devastating.

The US can still print dollars at will and run massive deficits that China seems happy to soak up, for the moment at least. As for the re-engineering of the WB and IMF sisters and their scholastic models, one can only hope that the earnestness manifested earlier this year has been translated into concrete actions under the stewardship of Mr Strauss-Kahn. There are no doubt some elements of progress, most notably in the jurisdiction of fiscal havens and in the very recent determination of French and UK governments to heavily tax scandalous bonuses by bailed-out banks, but by and large the common man can legitimately ask for more.

The main pillars of our own economy, including sugar, textiles, tourism, IT and property developments, are so intimately dependent on world events and trends, that we cannot avoid casting 2009 in the wider perspective where many far more resilient and resource-endowed countries have endured severe hardship. At huge cost to budget deficits, they have had to inject massively to prevent total meltdown, protect jobs, preserve the social fabric and nurture their productive sectors through the crisis. Here too the Exchequer has devised an approach that, at reasonable costs to fiscal and budgetary discipline, while still early for definite pronouncements, has reaped a degree of success that has been praised by knowledgeable experts and international institutions.

True to form, the various Opposition elements have quibbled that it was either too much, too little, too early or too late, some even prophesizing that the worst is yet to come. Gloom and doom would no doubt suit their personal agenda but even they must be secretly relieved that the country has faced the worst financial crisis in world history with laudable resilience. Some sectors may not be entirely out of the woods yet but on the whole, whether they entertain disagreements on some particular issues, the population knows that there has been intelligent stewardship at the helm of country during the storm. One could almost forget that the financial storm came soon after other massive international disruptions in fuel prices, food prices, the end of preferential regimes and a hefty 36% cut in EU-sugar export earnings…

While barely creeping out of the after-shocks to the financial crisis, the international community faces an even more intractable and complex scenario, played out at Copenhagen. The era of industrial and economic growth fuelled by seemingly limitless fossil resources is coming to its end and our generation of politicians and policy-makers has to mop up the consequences of two centuries of profligate dependency on coal and oil by today’s developed countries. Global warming, even if specialists disagree on scale and root causes, will impact us along with large tracts of the still developing world including the vulnerable island states. There are numerous implications for us, and even in the shorter-term perspective, our planners and authorities have to pore over the impact of rising ocean levels on the country’s coats and its outer islands and sand or fishing banks.

The most vexing question facing many countries however will be how to continue development with rarefied and costlier fossil fuels while reducing the carbon footprint. Without a massive boost in international research on alternative and commercially realistic energy supplies, the balancing act may prove to be very tricky and the implications wide-ranging. Which brings us to the local front, where the bagasse which ten years ago was still a cumbersome waste, can be tapped in co-generation mode to provide a large fraction of our year-round electricity generation capacity. Provided, of course, that national interests prevail over sectarian ones in the search of an equitable formula that compensates risks and investments fairly and rewards the bagasse from all cane producers equitably while benefiting the country’s electricity and power consumers.

Albeit prodded and pushed by the Alliance Sociale and the Prime Minister, King Sugar has come to abandon some of its rearguard battle-lines and recognize willy-nilly the need for a new consensus-driven sector. The few barons who have engrossed themselves in leonine IPP contracts and those who plan more of the same will have little sympathy should they wish to engage the rest of the MSPA or the country in another inglorious battle.

But then, 2010, according to Chinese wisdom, is the year of the metal tiger, one earmarked for tumultuousness by any standards. Hopefully such razzmatazz as the oracles forecast, will remain confined to the electoral and not the cane fields. Whatever the case, if only because of the electoral horizon, 2010 promises to unlock new perspectives in the continued quest for greater empowerment, economic ouverture and social justice in an era of sustainable development.

 

U.C.

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