Obama sees 2014 as 'breakthrough' year for US economy; UK deficit at 24-year high; Blackberry quarterly loss at $4.4bn; Of diplomats and privileges

1 Obama sees 2014 as 'breakthrough' year for US economy(BBC) Citing stronger growth figures, US President Barack Obama says 2014 will be a 'breakthrough year' for the US economy. Economic growth in the US was revised upwards to its fastest pace since late 2011 on Friday. The Commerce Department said GDP grew at an annualised rate of 4.1% between July and September, up from an earlier 3.6% estimate.

In his last press conference of the year, the US President highlighted the improving data as promising for the year ahead. "We head into next year with an economy that's stronger than it was when we started the year [and] more Americans are finding work and experiencing the pride of a paycheck," he said. Much of the revision was due to stronger consumer spending, which accounts for two-thirds of the economy.

On Wednesday the US central bank, the Federal Reserve, announced it would start to slow its economic stimulus programme because of the improving economy - in particular the falling unemployment rate. The central bank said it planned to scale back - or "taper" - its $85bn a month bond buying programme by $10bn a month.

http://www.bbc.co.uk/news/business-25461164

2 UK deficit at 24-year high (Katie Allen in The Guardian) There are warnings Britain's economic recovery was on shaky ground after official data showed the country's current account deficit with the rest of the world soared to its highest since 1989. Dealing a blow to chancellor George Osborne's push for a Britain that can "pay its way" in the world, the gap – Britain's trade deficit, plus the losses UK plc makes on its overseas ventures – ballooned to £21bn in the three months to September from a deficit of £6bn in the previous quarter.

As a percentage of GDP, the deficit was 5.1%, the biggest share for more than 20 years, the Office for National Statistics said. There was similarly downbeat news for the government's push to rebalance the economy from figures on what has been driving growth, and separate ONS data showed that public finances deteriorated last month.

There was some good news for Osborne on Friday when S&P affirmed the UK's AAA rating. But it said the outlook remained negative. The British Chambers of Commerce (BCC), which has been campaigning for more government help for companies that want to export, described Friday's data as a "mixed bag". With the economy now 2% smaller than before the crisis, according to the ONS, the BCC welcomed progress on closing the gap on pre-recession times.

http://www.theguardian.com/business/2013/dec/20/uk-trade-deficit-share-gdp-ons

3 Blackberry quarterly loss at $4.4bn (Charles Arthur in The Guardian) Blackberry's new chief executive John Chen signalled a new strategy focusing on providing secure email and device management to large businesses as the company plunged to a quarterly net loss of $4.4bn, on revenues down 56% to just $1.2bn. The huge loss, driven partly by enormous writedowns on existing inventory, is the largest in the company's history – but Chen insisted that the company is "very much alive" as he tries to shift it away from making handsets.

The company announced a five-year partnership with Taiwan's Foxconn, which already makes products for Apple and Microsoft, that will see it jointly develop and manufacture smartphones for the Canadian company, effectively taking over manufacturing operations and much of the risk of being left with unsold inventory. BlackBerry shipped just 1.9m handsets during the quarter, but customers bought a total of 4.3m handsets from outlets – of which 3.2m were the ageing BB7 model. Since its launch in January, only 4.6m BB10 handsets have been sold, making up less than half of total sales.

Chen, who only took over 45 days ago following a radical boardroom shakeup that ousted previous chief Thorsten Heins, acknowledged that the company has lost money on its handset business as part of the business's degradation over the past two years. Competition from Apple and Samsung has squeezed it from a commanding position in the consumer market back to its origins as a provider of secure email and communications for large "enterprise" businesses.

http://www.theguardian.com/technology/2013/dec/20/blackberry-record-net-loss-foxconn-partnership

4 Of diplomacy and privileges (Neeta Lal in Khaleej Times) A full-fledged diplomatic row has broken out between India and the US over the arrest in New York City of Devyani Khobragade, a mid-ranking, young diplomat at the Indian mission in New York. The charge against Khobragade is of visa fraud. She is said to have misrepresented the work conditions of a woman on her household staff.

It’s to review the sundry “immunities” enjoyed by diplomats.  Many of these were not conceived of by the drafters of the Vienna Convention, and the treaty was not meant to extend to episodes like ill treating maids. It’s time such frills were rationalised as a lot of them are archaic entitlements harking back to an earlier era.

For instance, why do Indian diplomats need to be accompanied by a battery of servants to foreign postings when Westerners seem to get by perfectly without such help? As is well-known, this leads to all kinds of under-the-radar dealings. It is a common practice amongst Indian diplomats serving in foreign countries to pay less than what is shown on official documents. The claim is that the salary fixed by the US government is too high for Indian diplomats to afford. How can they, plead Indian diplomats, pay their domestic help $4,500 monthly (as stipulated by the US Wage Act) when their own remuneration hovers around that mark? Besides, they question, are the American diplomats bound by any minimum wage framework when they hire help in India?

The lesson for India’s Ministry of External Affairs is that it needs to carefully vet the type of people it is sending to be the country’s face to the world. In the last two years alone, two Indian consular officers to the US have been in the news on charges of fraud and mistreatment of employees. Khobragade’s name has already cropped up in relation to the controversial Adarsh Cooperative Housing Society scam, yet she was packed off to an important international posting.

All said and done, perhaps there’s been one happy fallout from the brouhaha after all. While the US has got an unambiguous message that it can’t bully any or everybody at whim, India also seems to have discovered its diplomatic spine against Uncle Sam, at last.

http://khaleejtimes.com/kt-article-display-1.asp?xfile=data/opinion/2013/December/opinion_December39.xml&section=opinion