Cyprus bailout spreads panic; China is fifth largest arms exporter; Here come the domestic drones

1 Cyprus bailout spreads panic (Paul Gallagher & Helena Smith in The Guardian) Cypriots reacted with shock that turned to panic on Saturday after a 10% one-off levy on savings was forced on them as part of an extraordinary 10bn euro bailout agreed in Brussels.

People rushed to banks and queued at cash machines that refused to release cash as resentment quickly set in. The savers will raise almost €6bn thanks to a deal reached by European partners and the International Monetary Fund (IMF). It is the first time a bailout has included such a measure and Cyprus is the fifth country after Greece, the Republic of Ireland, Portugal and Spain to turn to the eurozone for financial help during the region's debt crisis. The move in the eurozone's third smallest economy could have repercussions for financially overstretched bigger economies such as Spain and Italy.

People with less than 100,000 euros in their accounts will have to pay a one-time tax of 6.75%, Eurozone officials said, while those with greater sums will lose 9.9%. Without a rescue, president Nicos Anastasiades said Cyprus would default and threaten to unravel investor confidence in the eurozone.

The prospect of savings being so savagely docked sparked terror among the island's resident British community. In the coastal town of Larnaca, Cypriots described how they had queued from the early hours in the hope of withdrawing deposits from banks. "A lot of us just can't believe it," said Alexandra Christofi, a divorcee in her 40s who said she had rushed to her bank before doors even opened at 6am.

The levy does not take effect until Tuesday, following a public holiday, but action is being taken to control electronic money transfers over the weekend. Co-operative banks, the only ones open in Cyprus on a Saturday, closed following a run on the credit societies while ATMs cancelled transactions due to "technical issues".

2 China is fifth largest arms exporter (Straits Times) China has overtaken Britain as the world's fifth largest arms exporter, a Swedish think-tank has said. The volume of Chinese weapons exports rose by 162% in the five-year period 2008-2012, compared to the previous five-year period, the Stockholm International Peace Research Institute (Sipri) said in its report. That means China's share of all international arms exports increased to 5% from 25, and the country climbed to fifth from eighth in the rankings.

The largest buyer of Chinese weapons was Pakistan, which accounted for 55% of the country's exports, followed by Myanmar with 8% and Bangladesh with 7%, Sipri said. "China's rise has been driven primarily by large-scale arms acquisitions by Pakistan," said Mr Paul Holtom, director of the Sipri Arms Transfers Programme.

2 Here come the domestic drones (Matthew  L Wald in The New York Times) “The sky’s going to be dark with these things,” said Chris Anderson, the former editor of Wired, who now runs a company, 3D Robotics, that sells unmanned aerial vehicles and equipment. He says it is selling about as many drones every calendar quarter — about 7,500 — as the US military flies in total.

The burst of activity in remotely operated planes stems from the confluence of two factors: electronics and communications gear has become dirt cheap, enabling the conversion of hobbyist radio-controlled planes into sophisticated platforms for surveillance, and the Federal Aviation Administration has been ordered by Congress to work out a way to integrate these aircraft into the national airspace by 2015. 

Some fans of the technology wince at the word “drone,” which implies that there is no pilot. And they have grown resentful about the alarms raised over privacy issues, noting that a few city and state governments have begun banning drones even where they do not yet operate. 

Aside from the missing persons mission, experts here outline a number of uses for the planes: “precision agriculture,” with tiny planes inspecting crops several times a week for the first sign of blight or insect invasion; safety missions by semiautonomous flying machines that could cruise the two-mile length of a freight train and examine the air brakes on each car, far faster than a person could, and be available for accident assessment in case of derailment; inspection operations of pipelines or power lines, a job that is notoriously dangerous for helicopters, and scouting out fires or car crashes. Remote control equipment might even displace some human pilots, in the cockpits of cargo planes.

New Pope is conservative with common touch; Catholic Church's shift southward; Why the World Bank group president visited Uttar Pradesh

1 New Pope is conservative with common touch (Emily Schmall & Larry Rohter in The New York Times) Like most of those in Argentina, he is a soccer fan, his favorite team being the underdog San Lorenzo squad. Known for his outreach to the country’s poor, he gave up a palace for a small apartment, rode public transportation instead of a chauffeur-driven car and cooked his own meals.

The new pope, Jorge Mario Bergoglio (pronounced ber-GOAL-io), 76, will be called Francis. He is in some ways a history-making pontiff, the first from the Jesuit order and the first pope from Latin America.

But Cardinal Bergoglio is also a conventional choice, a theological conservative of Italian ancestry who vigorously backs Vatican positions on abortion, gay marriage, the ordination of women and other major issues — leading to heated clashes with Argentina’s left-leaning president.

He was less energetic, however, when it came to standing up to Argentina’s military dictatorship during the 1970s as the country was consumed by a conflict between right and left that became known as the Dirty War. He has been accused of knowing about abuses and failing to do enough to stop them while as many as 30,000 people were disappeared, tortured or killed by the dictatorship.

Despite the criticism, many here praise Cardinal Bergoglio — who likes the more humble title of Father Jorge — as a passionate defender of the poor and disenfranchised.

2 Catholic Church’s shift southward (The New York Times) In 1900, two-thirds of the world’s Catholics lived in Europe. Today only 20% do.

Over the last century, much of the growth of the Roman Catholic Church has been outside Europe, and there are now more than 200 million more Catholics in Latin America than in Europe.

3 Why the World Bank group president visited Uttar Pradesh (Prasanta Sahu in The Wall Street Journal) World Bank Group President Jim Yong Kim spent a significant chunk of his three-day trip in India in the northern state of Uttar Pradesh. India has the highest number of poor people in world: about 400 million people, or over 30% of its 1.24 billion people, according to World Bank data. Over half of U.P.’s population of 200 million lives on less than $1.25 a day.

This makes U.P. central to the World Bank’s poverty eradication strategy. Mr. Kim said that unless significant progress is made in U.P., it will be difficult to eradicate poverty in India, and in the world more broadly.

India is the largest client of the World Bank, which has lent the country around $26 billion over the past five years. Mr. Kim said the bank plans to lend between $3 billion and $5 billion a year to India from 2014 to 2018.

“The World Bank Group’s mission of eradicating global poverty and boosting shared prosperity cannot be fulfilled if Uttar Pradesh continues to be home to 66 million of India’s poor – the highest in any state,” Mr. Kim said in Lucknow, U.P., on Tuesday.

 

 

 

 

 

 

France to break deficit pledge; The health of nations

1 France to break deficit pledge (BBC) President Francois Hollande has admitted France will miss its target on lowering the budget deficit this year. France's deficit will "without a doubt" be 3.7% of its output this year, he said, above the 3% he promised to cut it to during the election last year. The 3% deficit target is also one set by the European Union - but most of the major euro nations are in breach.

Greece, Ireland and Portugal have been effectively shut out of borrowing long term on international financial markets, which forced them to seek help from European partners and the International Monetary Fund. They all adopted austerity policies to cut public spending, but France has bucked the trend, raising taxes instead to protect its social model.

During the election last year, Mr Hollande vowed to bring the deficit to 3% from its current 4.5% and had insisted this was possible until now admitting defeat. But he defended his record, saying that the deficit has come down from more than 5% in 2011. "Addressing our accounts is a financial obligation... but it is also an obligation of sovereignty because France must never be in difficulty in the markets." The number of jobless in France has now risen past 3 million.

2 The health of nations (Khaleej Times) According to many scholars of the liberal tradition, the state’s sole purpose in a capitalist society should be to prevent its citizens from impinging on each other’s freedoms. So, in the modern world founded on principles of democracy and freedom, how far can the state go to violate a consumer’s freedom, purportedly for the sake of his or her own good? While most countries have actually managed to curb smoking in public areas, they struggle with consumer behaviour, which pits freedom of choice against imperatives of public health.

The latest revocation of the ban on large-size sugary drinks by a court in New York — a place where 58% of adults are obese — is proof of the fact that it is difficult for the state to change consumption habits, even if they are for the sake of the collective good.  Two days before the ban on large sugary drinks was going to be implemented in the city, a court blocked it, terming it “arbitrary and capricious”. The ruling marks the triumph of industry groups, particularly the American Beverage Association, which sued the city for proposing the ban. 

However, New York city mayor Michael Bloomberg has denounced the new judicial ruling, saying that he will continue to fight the ban. This example clearly shows that is it difficult for states to implement checks on the modern production of food and other goods involving the use of harmful hormones, chemicals and processes, especially because of influential industry lobbies. 

But there’s another path that governments can tread to solve this issue. Instead of struggling to ban widely consumed products that may harm health, educating consumers is actually more effective. For instance, effective public campaigns against tobacco consumption in the developed world, have contributed to a significant decline in cigarette smoking over the decades. The secret to changing individual habit, therefore, lies in awareness, not prohibition.

France fears triple-dip recession; Italy on the brink; Motorola Mobility cutting 1,200 jobs

1 France fears triple-dip recession (Phillip Inman in The Guardian) France appears to be heading for a triple dip recession amid concerns that political deadlock in Italy could drag the eurozone back into crisis. French industrial production dropped by 1.2% in January despite a strong rebound in German imports that some analysts believed might rescue some of its neighbours.

Official figures from Paris showed that a longstanding slump in car buying across much of the eurozone has undermined efforts to maintain a 0.9% rise in December. Car-making dropped by 13.5% in January after a revised 8.8% increase in December. Peugeot Citroen and Renault have suffered a steep fall in sales during the last year and cut production at many of their factories. Analysts said the drop in overall output was a further sign that France's €2tn economy could slip into recession after contracting 0.3% in the final quarter of 2012 and following a series of weak data this year.

Italy has proved a particular graveyard for car sellers, prompting the boss of Fiat to say production in Turin may stop if the slide continues for much longer. Fiat, which owns Chrysler, has expanded production in the US while restricting output in the eurozone. Rome was battling to maintain some stability after figures showed its recession is likely to run into 2014 even with a resolution to the electoral stalemate. One analyst said Italy posed a "near and present danger" for the eurozone.

2 Italy on the brink (Liz Alderman in The New York Times) Since a government austerity plan took hold last year, the Italian economy has tumbled into one of the worst recessions of any euro zone country. Businesses of all sizes have been going belly up at the rate of 1,000 a day over the last year; especially hard hit among Italy’s estimated six million companies are the small and midsize companies that represent the backbone of Italy’s $2 trillion economy.

Economists worry that the pace of business closings may accelerate as long as the country lacks a functioning government. The departing prime minister, Mario Monti, was ousted by austerity-weary voters, but the election left Parliament gridlocked. With the European Union standing as America’s largest trading partner, the economic problems that plague Italy — and the rest of stagnating Europe — are felt across the Atlantic.

“This underscores the likelihood of Italy having a Japan-like decade with phenomenally slow growth,” said Kenneth S. Rogoff, a professor at Harvard and a former chief economist of the International Monetary Fund. “And it raises painful questions about the long-run stability of growth in the euro zone over all.” 

The afflictions of Italy’s economy, one of Europe’s largest, are not new, of course: a lumbering bureaucracy, stifling labor regulations and an eroding ability to compete in the global marketplace. As the economy of the 17 members of the European Union that use the euro as their currency was expanding at a weak average of 1% a year for much of the last decade, Italy grew at only half that rate, according to the International Monetary Fund. 

But Italy’s longstanding problems have grown worse in the last year as tax increases and spending cuts were pressed by Mr. Monti, who took over as prime minister in November 2011 after the euro crisis forced out Silvio Berlusconi. Last year the economy shrank 2.4%. One in two small companies cannot pay its employees on time, according to CGIA di Mestre, a research institute. With layoffs surging, unemployment rose to 11.7% in January. Youth unemployment has jumped to 38.7%. 

3 Motorola Mobility cuts 1,200 jobs (BBC) Google's Motorola Mobility Unit has said it is cutting 1,200 jobs, or more than 10% of its workforce. It follows a 4,000 jobs cut last August as Google aims to turn around the loss-making business it acquired last year for $12.5bn. The layoffs are expected to affect the US, China and India, according to a company email. The Motorola unit was bought for its Android-operating mobile devices and access to more than 17,000 patents.

"These cuts are a continuation of the reductions we announced last summer," Google spokeswoman Niki Fenwick said. An internal email published by the Wall Street Journal said: "Our costs are too high, we're operating in markets where we're not competitive and we're losing money." Motorola, which once dominated the mobile phone market, has fallen behind its competitors, including Apple and Samsung.

Motorola Mobility was created in 2011 when Motorola Inc split the company into a mobile devices unit and a government and public safety division known as Motorola Solutions.

The price of marriage in China; When dad is absent; 'Decline' of India Muslims

1 The price of marriage in China (Brook Larmer in The New York Times) Three decades of combustive economic growth have reshaped the landscape of marriage in China. A generation ago, China was one of the world’s most equal nations, in both gender and wealth. Most people were poor, and tight controls over housing, employment, travel and family life simplified the search for a suitable match — what the Chinese call mendang hudui, meaning roughly “family doors of equal size.”

China’s transition to a market economy has swept away many restrictions in people’s lives. But of all the new freedoms the Chinese enjoy today — making money, owning a house, choosing a career — there is one that has become an unexpected burden: seeking a spouse. This may be a time of sexual and romantic liberation in China, but the solemn task of finding a husband or wife is proving to be a vexing proposition for rich and poor alike.

The confusion surrounding marriage in China reflects a country in frenzied transition. Sharp inequalities of wealth have created new fault lines in society, while the largest rural-to-urban migration in history has blurred many of the old ones. As many as 300 million rural Chinese have moved to cities in the last three decades. Uprooted and without nearby relatives to help arrange meetings with potential partners, these migrants are often lost in the swell of the big city. 

Demographic changes, too, are creating complications. Not only are many more Chinese women postponing marriage to pursue careers, but China’s gender gap — 118 boys are born for every 100 girls — has become one of the world’s widest, fueled in large part by the government’s restrictive one-child policy. By the end of this decade, Chinese researchers estimate, the country will have a surplus of 24 million unmarried men. 

Single men have a hard time making the list if they don’t own a house or an apartment, which in cities like Beijing are extremely expensive. And despite the gender imbalance, Chinese women face intense pressure to be married before the age of 28, lest they be rejected and stigmatized as “leftover women.” 

2 When dad is absent (Jackie May in Johannesburg Times) A friend once told me the best thing a father can do for his children is to love their mother. There are obvious benefits: harmony in the home and good romantic role modelling for the children. Between 1996 and 2010 there was an increase in absent living fathers in South Africa from 41.6% to 47.4%. That's almost half of fathers who don't live with their children, and who don't share the daily responsibility of taking care of their children.

I've seen how fathers, who don't actively parent, if they can afford it, send a cellphone as a gift once a year or buy clothes for their children at Christmas time. But these rare acts of generosity don't replace the parenting that is lost when parents don't live at home. I have seen the bitterness that creeps in after years of receiving gifts without real caring. Sheryl Sandberg, COO of Facebook, in a piece for this week's Time magazine wrote that "a truly equal world would be one where women ran half our countries and companies and men ran half our homes".

Her book Lean In has caused a stir in the US, with women criticising her for being an elitist, but her words and advice are wise: "We need men to lean into their families more, especially since research has consistently found that children with involved and loving fathers have higher levels of psychological wellbeing and better cognitive abilities". For men to take more care of their children may mean giving up alcohol, girlfriends, power or whatever it is that makes them absent. But they might find they actually enjoy the job, and we know that society would certainly benefit from it.

3 ‘Decline’ of India Muslims (Irfan Husain in Dawn) Traditionally, Muslims in India were urban, with rulers from the Sultanate period to the Mughals settling in cities that were expanded and beautified. Even when they began acquiring jagirs or large rural estates, the aristocrats were reluctant to move far from the seats of power. In his magisterial The Last Mughal, William Dalrymple documents the dismantling of the Indian Muslim aristocracy in the bloody aftermath of the revolution of 1857.

Even though Bahadur Shah Zafar, the last Mughal, was a reluctant figurehead for the anti-British movement, the Muslim community as a whole was held responsible by a vengeful British Empire. Entire neighbourhoods in Delhi were levelled, and thousands of Muslim hanged, shot or blown from the mouths of canons. Many others, including Bahadur Shah, were exiled to die in penury.

Traumatised, Muslims turned inwards. As western education became a requirement for government jobs, few Muslims could compete. Psychologically, many traditional Muslims felt they would be formally acknowledging their defeat by accepting the ways of their conquerors. Hindus, on the other hand, had no such hang-ups and were soon manning many positions in the bureaucracy.

When partition came, a large section of the Muslim leadership and the professional class moved to the newly created state of Pakistan. Tensions and wars between India and Pakistan did nothing to improve the lot of Indian Muslims who were suspected by the majority of secretly supporting Pakistan. Even though the present generation is largely indifferent to their neighbour, their religion still sets them apart. Indeed, watching the rising tide of violence here, several Muslim readers from India have expressed their relief that their families stayed put in 1947.

An Economist article asks: “… are Muslims better off? Wajahat Habibullah, who heads the National Commission for Minorities in Delhi sees only faint reasons for cheer. Muslims in India outperform their neighbours in Pakistan on some social indicators, such as having lower fertility rates and infant mortality, and higher literacy and life expectancy.” But sadly, comparisons with the national average for India present a far bleaker picture.