Martes, Mayo 17, 2011
Reaction in Military spending:
War isn't convenient. The blog below proved that. It only builds uncertainty to the people, also drags the economy down, wherein the budget should be for the betterment of the whole population; public hospitals, schools, feeding and etc. Nowadays, the big shot countries like the US and China are wasting more money on high end technologies and weaponry for defense. More countries increased their military spending and it is a bad thing to do. Countries should focus more on how to raise their economic status and should tackle first the crisis of the country; poverty. It's very sad to think that half of our budget is wasted on weaponry. With our condition now, my reaction would be a good protest. I'm not saying that we should not buy anymore weapons but it would've been better, in my opinion, to first take care of poverty.
Military Expenditures
World Military Spending
Global military expenditure stands at over $1.6 trillion in annual expenditure at current prices for 2010 (or $1.56 trillion dollars at constant 2009 prices), and has been rising in recent years.(1991 figures are unavailable. Chart uses 2009 constant prices for comparison.)
Summarizing some key details from the Stockholm International Peace Research Institute (SIPRI)’s recent trends summary:
- World military expenditure in 2010 is estimated to have reached $1.62 trillion in current dollars;
- This represents a 1.3 per cent increase in real terms since 2009 and a 50 per cent increase since 2001;
- This corresponds to 2.6 per cent of world gross domestic product (GDP), or approximately $236 for each person in the world;
- The USA with its massive spending budget, is the principal determinant of the current world trend, and its military expenditure now accounts for just under half of the world total, at 43% of the world total;
- The 15 countries with the highest spending account for over 82% of the total;
- The USA is responsible for 43 per cent of the world total, distantly followed by the China (7.3% of world share), UK (3.7%), France (3.6%), and Russia (3.6%):
Military spending is concentrated in North America, Europe, and increasingly, Asia:
Increased spending before and even during global economic crisis
The global financial and economic crisis has resulted in many nations cutting back on all sorts of public spending (often against the criticism of targeting sectors that were not responsible for the crisis), and yet military spending seems to be increasing. How is that justified?It should be noted that just before the crisis hit, many nations were enjoying either high economic growth or far easier access to credit without any knowledge of what was to come.
A combination of factors explained increased military spending in recent years before the economic crisis as earlier SIPRI reports had also noted, for example:
- Foreign policy objectives
- Real or perceived threats
- Armed conflict and policies to contribute to multilateral peacekeeping operations
- Availability of economic resources
China, for the first time, ranked number 2 in spending in 2008.
But even during the past year in the aftermath of the financial crisis and cries of governments cutting back, military spending appears to have been spared. How is that justified? SIPRI provides some observations:
The USA led the rise [in military spending], but it was not alone. Of those countries for which data was available, 65% increased their military spending in real terms in 2009. The increase was particularly pronounced among larger economies, both developing and developed: 16 of the 19 states in the G20 saw real-terms increases in military spending in 2009.
— Sam Perlo-Freeman, Olawale Ismail and Carina Solmirano, Military Expenditure
, Chapter 5, SPIRI Yearbook, June 2010, p.1
- Some nations like China and India have not experienced a downturn, but instead enjoyed economic growth
- Most developed (and some larger developing) countries have boosted public spending to tackle the recession using large economic stimulus packages. Military spending, though not a large part of it, has been part of that general public expenditure attention (some also call this “Military Keynesianism”
- Geopolitics and strategic interests to project or maintain power: “rising military spending for the USA, as the only superpower, and for other major or intermediate powers, such as Brazil, China, Russia and India, appears to represent a strategic choice in their long-term quest for global and regional influence; one that they may be loath to go without, even in hard economic times”, SIPRI adds.
Natural resources have also driven military spending and arms imports in the developing world. The increase in oil prices means more for oil exporting nations.
The “natural resource curse” has long been recognized as a phenomenon whereby nations, despite abundant rich resources, find themselves in conflict and tension due to the power struggles that those resources bring (internal and external influences are all part of this).
In their earlier 2006 report SIPRI noted that, Algeria, Azerbaijan, Russia and Saudi Arabia have been able to increase spending because of increased oil and gas revenues, while Chile and Peru’s increases are resource-driven, “because their military spending is linked by law to profits from the exploitation of key natural resources.”
Also, “China and India, the world’s two emerging economic powers, are demonstrating a sustained increase in their military expenditure and contribute to the growth in world military spending. In absolute terms their current spending is only a fraction of the USA’s. Their increases are largely commensurate with their economic growth.”
The military expenditure database from SIPRI also shows that while percentage increases over the previous decade may be large for some nations, their overall spending amounts may be varied.
(See also this summary of trends, also from SIPRI. The latest figures SIPRI uses are from 2010, and where necessary (e.g. China and Russia), include estimates.)
Spending for peace vs spending for war
In a similar report from 2004, the SIPRI authors also noted that, “There is a large gap between what countries are prepared to allocate for military means to provide security and maintain their global and regional power status, on the one hand, and to alleviate poverty and promote economic development, on the other.”Indeed, compare the military spending with the entire budget of the United Nations:
The United Nations and all its agencies and funds spend about $30 billion each year, or about $4 for each of the world's inhabitants. This is a very small sum compared to most government budgets and it is less than three percent of the world's military spending. Yet for nearly two decades, the UN has faced financial difficulties and it has been forced to cut back on important programs in all areas, even as new mandates have arisen. Many member states have not paid their full dues and have cut their donations to the UN’s voluntary funds. As of December 31, 2010, members’ arrears to the Regular Budget topped $348 million, of which the US owed 80%.
— UN Financial Crisis, Global Policy Forum (accessed May 2, 2011)
- The UN was set up to be committed to preserving peace through international cooperation and collective security.
- Yet, the UN’s entire budget is just a tiny fraction of the world’s military expenditure, approximately 1.8%
- While the UN is not perfect and has many internal issues that need addressing, it is revealing that the world can spend so much on their military but contribute so little to the goals of global security, international cooperation and peace.
- As well as the above links, for more about the United Nations, see the following:
- This web site’s section on the United Nations and Development looks at its role in fighting poverty and other issues, plus some of the problems it faces.
- The United Nations web site
At a time when a deep economic recession is causing much turbulence in the civilian world … defense giants such as Boeing and EADS, or Finmeccanica and Northrop Grumman, are enjoying a reliable and growing revenue stream from countries eager to increase their military might.
Both geopolitical hostilities and domestic violence tend to flare up during downturns.
…
Shareholders and employees in the aerospace and defense industry are clearly the ones who benefit most from growing defense spending.
Defense companies, whose main task is to aid governments’ efforts to defend or acquire territory, routinely highlight their capacity to contribute to economic growth and to provide employment.
Indeed, some $2.4 trillion (£1.5tr), or 4.4%, of the global economy “is dependent on violence”, according to the Global Peace Index, referring to “industries that create or manage violence” — or the defense industry.
…
Military might delivers geopolitical supremacy, but peace delivers economic prosperity and stability.
And that, the report insists, is what is good for business.
— Jorn Madslien, The purchasing power of peace, BBC, June 3, 2009
Global Peace Index 2009 attempts to rank nations on various indicators of peace. Most countries are not considered peaceful, unfortunately.
Other spending priorities»
These issues have been of concern for a number of years. For example, consider this from 1998:
The illegal international drugs trade is estimated to be worth more than $400 billion, coming second only to military expenditure.
And consider the following, reflecting world priorities:
And compare that to what was estimated as additional costs to achieve universal access to basic social services in all developing countries:
(Source: The state of human development, United Nations Human Development Report 1998, Chapter 1, p.37)
It would seem ironic that the world spends more on things to destroy each other (military) and to destroy ourselves (drugs, alcohol and cigarettes) than on anything else.
The illegal international drugs trade is estimated to be worth more than $400 billion, coming second only to military expenditure.
And consider the following, reflecting world priorities:
Global Priority | $U.S. Billions |
---|---|
Cosmetics in the United States | 8 |
Ice cream in Europe | 11 |
Perfumes in Europe and the United States | 12 |
Pet foods in Europe and the United States | 17 |
Business entertainment in Japan | 35 |
Cigarettes in Europe | 50 |
Alcoholic drinks in Europe | 105 |
Narcotics drugs in the world | 400 |
Military spending in the world | 780 |
Global Priority | $U.S. Billions |
---|---|
Basic education for all | 6 |
Water and sanitation for all | 9 |
Reproductive health for all women | 12 |
Basic health and nutrition | 13 |
It would seem ironic that the world spends more on things to destroy each other (military) and to destroy ourselves (drugs, alcohol and cigarettes) than on anything else.
These statistics are quickly getting old. If someone has had the time to research updated statistics, please let me know!
US Military Spending
The United States has unquestionably been the most formidable military power in recent years. Its spending levels, as noted earlier, is the principle determinant of world military spending and is therefore worth looking at further.Generally, US military spending has been on the rise. Recent increases are attributed to the so-called War on Terror and the Afghanistan and Iraq invasions, but it had also been rising before that.
For example, Christopher Hellman, an expert on military budget analysis notes in The Runaway Military Budget: An Analysis
Overall spending
Defense budget vs War spending
Raw data and sources
Year | National defense budget ($bn) | War Supplemental ($bn) | Total military spending ($bn) |
---|---|---|---|
Source: Growth in U.S. Defense Spending Since 2001 Note: Numbers may not add up due to rounding. Figures include Department of Defense spending (which includes non-war supplemental appropriations for some years) and the costs of the wars in Afghanistan and Iraq. Department of Energy’s nuclear weapons program are not included and typically range from $21bn – $25bn each year. FY11 and FY12 figures are estimates. Laicie Olson from the Center for Arms Control provides further information and analysis. | |||
2012 | 553 | 118 | 671 |
2011 | 549 | 159 | 708 |
2010 | 529 | 162 | 691 |
2009 | 520 | 146 | 667 |
2008 | 480 | 187 | 667 |
2007 | 435 | 166 | 601 |
2006 | 419 | 116 | 535 |
2005 | 403 | 76 | 479 |
2004 | 377 | 91 | 468 |
2003 | 365 | 72 | 437 |
2002 | 328 | 17 | 345 |
2001 | 303 | 13 | 316 |
Unfortunately, the budget numbers can be a bit confusing. For example, the Fiscal Year budget requests for US military spending do not include combat figures (which are supplemental requests that Congress approves separately). The budget for nuclear weapons falls under the Department of Energy, and for the 2010 request, was about $25 billion.
The cost of war (Iraq and Afghanistan) has been very significant during George Bush’s presidency. Christopher Hellman and Travis Sharp also discuss the US fiscal year 2009 Pentagon spending request and note that “Congress has already approved nearly $700 billion in supplemental funding for operations in Iraq and Afghanistan and an additional $126 billion in FY'08 war funding is still pending before the House and Senate.”
Furthermore, other costs such as care for veterans, health care, military training/aid, secret operations, may fall under other departments or be counted separately.
The frustration of confusing numbers seemed to hit a raw nerve for the Center for Defense Information, concluding
The articles that newspapers all over the country publish today will be filled with [military spending] numbers to the first decimal point; they will seem precise. Few of them will be accurate; many will be incomplete, some will be both. Worse, few of us will be able to tell what numbers are too high, which are too low, and which are so riddled with gimmicks to make them lose real meaning.
— Winslow T. Wheeler, What Do the Pentagon’s Numbers Really Mean? The Chaos in America’s Vast Security Budget, Center for Defense Information, February 4, 2008
In Context: US Military Spending Versus Rest of the World
Using the SIPRI military expenditure database we see the breakdown described earlier:As a pie chart
The US alone accounts for over two-fifths (or just under half) of the world’s spending:Since 2001
World spending has risen since 2001. Both the US and other top spenders have influenced that rise.(Click on the “Play” button to see the data over time)
US vs. others
- US military spending accounts for 43 percent, or over two-fifths (almost half) of the world’s total military spending
- US military spending is almost 6 times more than China, 12 times more than Russia, and 98 times more than Iran.
- US military spending is some 47 times the spending on the six “rogue” states (Cuba, Iran, Libya, North Korea, Sudan and Syria) whose spending amounts to just under $15 billion.
- US spending is more than the next top 17 countries.
- The United States and its strongest allies (the NATO countries, Japan, South Korea and Australia) spend something in the region of $1.1 trillion on their militaries combined, representing 72 percent of the world’s total.
- The six potential “enemies,” Russia, and China together account for about $178 billion or 26% of the US military budget.
Top spenders (and sources)
Country | Dollars (billions) | % of total | Rank |
---|---|---|---|
Source: The 15 countries with the highest military expenditure in 2010, SIPRI, 2011 Note: Due to rounding, some percentages may be slightly off. If you are viewing this table on another site, please see http://www.globalissues.org/article/75/world-military-spending for further details. | |||
United States | 43% | 1 | |
China | 7.3% | 2 | |
United Kingdom | 3.7% | 3 | |
France | 3.6% | 4 | |
Russia | 3.6% | 5 | |
Japan | 3.3% | 6 | |
Saudi Arabia | 2.8% | 7 | |
Germany | 2.8% | 8 | |
India | 2.5% | 9 | |
Italy | 2.3% | 10 | |
Brazil | 2.1% | 11 | |
South Korea | 1.7% | 12 | |
Australia | 1.5% | 13 | |
Canada | 1.4% | 14 | |
Turkey | 1.1% | 15 | |
Rest of world | 17.3% | ||
Global Total (not all countries shown): 1,630 |
In Context: US military budget vs. other US priorities
Supporters of America’s high military expenditure often argue that using raw dollars is not a fair measure, but that instead it should be per capita or as percentage of Gross Domestic Product (GDP), and even then the spending numbers miss out the fact that US provides global stability with its high spending and allows other nations to avoid such high spending.Although some of the issues discussed here are about US spending, they are also relevant to a number of other nations.Should spending be tied to GDP?
Chris Hellman argues that GDP is not an appropriate way to measure necessary US military budget allocation:Linking military spending to the GDP is an argument frequently made by supporters of higher military budgets. Comparing military spending (or any other spending for that matter) to the GDP tells you how large a burden such spending puts on the US economy, but it tells you nothing about the burden a $440 billion military budget puts on U.S. taxpayers. Our economy may be able to bear higher military spending, but the question today is whether current military spending levels are necessary and whether these funds are going towards the proper priorities. Further, such comparisons are only made when the economy is healthy. It is unlikely that those arguing that military spending should be a certain portion of GDP would continue to make this case if the economy suddenly weakened, thus requiring dramatic cuts in the military.
— Chris Hellman, The Runaway Military Budget: An Analysis
, Friends Committee on National Legislation, March 2006, no. 705, p. 3
As Travis Sharp summarizes, critics of tying the US military budget to 4% of GDP fail in 3 ways:
- It would add $1.4 trillion to $1.7 trillion to deficits over the next decade and provide more defense funding than is forecast to be necessary;
- It would determine budgets using rigid formulas instead of realistic threat-based analysis, which would allow procurement to drive strategy rather than the other way around; and
- It is politically unviable in the economic and budgetary environment faced by the United States.
GDP is an important metric for determining how much the United States could afford to spend on defense, but it provides no insight into how much the United States should spend. Defense planning is a matter of matching limited resources to achieve carefully scrutinized and prioritized objectives. When there are more threats, a nation spends more. When there are fewer threats, it spends less. As threats evolve, funding should evolve along with them.…
Unfortunately, setting defense spending at four percent of GDP would shield the Pentagon from careful scrutiny and curtail a much-needed transparent national debate.
— Travis Sharp, Debate: Four Percent of Gross Domestic Product for Defense?, Center for Arms Control and Non-Proliferation, February 26, 2009 (Emphasis added)
With the change in presidency from George Bush to Barack Obama, the US has signaled a desire to reform future spending and already indicated significant changes for the FY 2010 defense budget. For example, the US has indicated that it will cut some high-tech weapons that are deemed as unnecessary or wasteful, and spend more on troops and reform contracting practices and improve support for personnel, families and veterans.
There is predictable opposition from some quarters arguing it will threaten jobs and weaken national security, even though spending has been far more than necessary for over a decade. The Friends Committee on National Legislation argues that the job loss from decreased military spending argument is weak: “It is true that discontinuing weapons systems will cause job loss in the short term, but unnecessary weapons manufacturing should not be considered a jobs program (that would be like spending billions of dollars digging holes), and research shows that these jobs can be successfully transferred to other sectors.” In other words, this is unnecessary and wasted labor (as well as wasted capital and wasted resources).Furthermore, rather than creating/sustaining jobs, some research suggests that increased military spending leads to job losses .
And well into 2010, SIPRI comments on the sustained high US military spending despite Obama’s suggestion otherwise:
How is it that US military spending, already far exceeding that of any other country and at record real-terms levels since World War II, is continuing to increase in the face of a dire economic crisis and a president committed to a more multilateral foreign policy approach?
One factor remains the conflict in Afghanistan, to which Obama is committed and where the US troop presence is increasing, even as the conflict in Iraq winds down.
Another is that reducing the military budget can be like turning round the proverbial supertanker—weapon programs have long lead times, and may be hard to cancel. Members of the Congress may also be resistant to terminating programmes bringing jobs to their states….
However, the fact that military expenditure is continuing to increase even as other areas are cut suggests a clear strategic choice: the fundamental goal of ensuring continued US dominance across the spectrum of military capabilities, for both conventional and ‘asymmetric’ warfare, has not changed.
— Sam Perlo-Freeman, Olawale Ismail and Carina Solmirano, Military Expenditure
, Chapter 5, SPIRI Yearbook, June 2010, p.3 (line breaks and emphasis added)
US high military spending means others do not have to?
Some argue that high US military spending allows other nations to spend less. But this view seems to change the order of historical events:- During the Cold War, high spending was common around the world.
- High spending was reduced by allies such as various European and Asian countries as the Cold War ended (almost 2 decades ago) not because other nations felt they would be protected by the US — a dangerous foreign policy choice by any sovereign nation to rely so much on others in this way — but because they perceived any global threat from the Cold War had diminished and simply didn’t need such high spending any more; globalization of trade was supposed to be ushered in and lead to a new era.
- It was only the US as the remaining global super power that maintained a high budget. Many argue this was to strengthen its position as sole super power and that its “military industrial complex” was able to convince their public to maintain it.
However, whether this global hegemony and stability actually means positive stability, peace and prosperity for the entire world (or most of it) is subjective. That is, certainly the hegemony at the time, and its allies would benefit from the stability, relative peace and prosperity for themselves, but often ignored in this is whether the policies pursued for their advantages breeds contempt elsewhere.As the global peace index chart shown earlier reveals, massive military spending has not led to a much global peace.As noted in other parts of this site, unfortunately more powerful countries have also pursued policies that have contributed to more poverty, and at times even overthrown fledgling democracies in favor of dictatorships or more malleable democracies. (Osama Bin Laden, for example, was part of an enormous Islamic militancy encouraged and trained by the US to help fight the Soviet Union. Of course, these extremists are all too happy to take credit for fighting off the Soviets in Afghanistan, never acknowledging that it would have been impossible without their so-called “great satan” friend-turned-enemy!)
So the global good hegemon theory may help justify high spending and even stability for a number of other countries, but it does not necessarily apply to the whole world. To be fair, this criticism can also be a bit simplistic especially if an empire finds itself against a competitor with similar ambitions, that risks polarizing the world, and answers are likely difficult to find.But even for the large US economy, the high military spending may not be sustainable in the long term. Noting trends in military spending, SIPRI added that the massive increase in US military spending has been one of the factors contributing to the deterioration of the US economy since 2001. SIPRI continues that, “In addition to its direct impact of high military expenditure, there are also indirect and more long-term effects. According to one study taking these factors into account, the overall past and future costs until year 2016 to the USA for the war in Iraq have been estimated to $2.267 trillion.”
US military budget vs. other US priorities
The peace lobby, the Friends Committee on National Legislation, calculates for Fiscal Year 2010 that the majority of US tax payer’s money goes towards war:As a pie chart
Raw data and sources
2010 (in billions of dollars) | 2010 percent of federal funds budget | |
---|---|---|
Source: Where Do Our Income Tax Dollars Go? | ||
Current Military Spending | 803 | 28% |
Interest on Pentagon Debt | 181 | 6% |
Veterans | 124 | 4% |
Total military percent | 1,107 | 39% |
Health care | 567 | 20% |
Responses to Poverty | 496 | 17% |
Interest on Public Debt | 244 | 9% |
Supporting the Economy | 175 | 6% |
Federal Government Operations | 141 | 5% |
Energy, Science, & Environment | 88 | 3% |
Diplomacy, Development and War Prevention | 46 | 2% |
Year | Total ($) | Defense ($) | Defense (%) | Education ($) | Education (%) | Health ($) | Health (%) |
---|---|---|---|---|---|---|---|
Sources and notes
| |||||||
2009 | 997 | 541 | 54 | 61.9 | 6.2 | 52.7 | 5.3 |
2008 | 930 | 481.4 | 51.8 | 58.6 | 6.3 | 52.3 | 5.6 |
2007 | 873 | 460 | 52.7 | 56.8 | 6.5 | 53.1 | 6.1 |
2006 | 840.5 | 438.8 | 52 | 58.4 | 6.9 | 51 | 6.1 |
2005 | 820 | 421 | 51 | 60 | 7 | 51 | 6.2 |
2004 | 782 | 399 | 51 | 55 | 7 | 49 | 6.3 |
2003 | 767 | 396 | 51.6 | 52 | 6.8 | 49 | 6.4 |
[T]he lion’s share of this money is not spent by the Pentagon on protecting American citizens. It goes to supporting U.S. military activities, including interventions, throughout the world. Were this budget and the organization it finances called the “Military Department,” then attitudes might be quite different. Americans are willing to pay for defense, but they would probably be much less willing to spend billions of dollars if the money were labeled “Foreign Military Operations.”
— The Billions For “Defense” Jeopardize Our Safety, Center For Defense Information, March 9, 2000
But it is not just the U.S. military spending. In fact, as Jan Oberg argues, western militarism often overlaps with civilian functions affecting attitudes to militarism in general. As a result, when revelations come out that some Western militaries may have trained dictators and human rights violators, the justification given may be surprising, which we look at in the next page.
Sources:
http://www.globalissues.org/article/75/world-military-spending
Miyerkules, Mayo 4, 2011
Reaction in Japan's Economy:
After Japan experienced numerous earthquakes and tsunamis...their economy suffered and is doubtful if it would still see itself in the most improved countries. In my opinion, Japan should focus more on their more useful resources left and try to propagate it and start to make it more resourceful. If they are successful in regaining these inputs for products, it would be better if they wouldn't export yet since they are still suffering a break down in economy. This kind of scenario explains why connections and healthy relationship with other countries are most important.
Linggo, Mayo 1, 2011
Japan's economy heads into freefall after earthquake and tsunami
A factory facility burns in Sendai in northern Japan after Friday's earthquake. Photograph: Kyodo/Reuters
The full extent of the economic impact of Friday's earthquake and tsunami is becoming apparent , with hundreds of factories shut across Japan, warnings of rolling blackouts and predictions from economists that the disaster would push the country into recession.
The Bank of Japan is preparing to pump billions of yen into the economy when it announces an emergency "quake budget" on Monday to prevent the disaster derailing the country's fragile economic recovery.
Toyota and Nissan said they were halting production at all of their 20 factories. Toyota, the world's largest carmaker, evacuated workers from two plants in the worst affected regions and has not been able to reach the sites to inspect the damage. The plants make up to 420,000 small cars each year, mostly for export. Two of Honda's three plants remain closed.
Other manufacturers have also reported major damage to their factories, with Kirin Holdings, Fuji Heavy Industries, GlaxoSmithKline and Nestlé among those to halt operations. Sony, the electronics group, has suspended production at eight plants. At one plant, 1,000 workers had to take refuge on the second floor after the tsunami hit. All ports have been closed amid warnings of aftershocks to come.
Japan's utilities providers are warning of rolling blackouts across the country in the coming days because they are unable to meet electricity demand. Nuclear power generates about a third of the country's electricity but six reactor units at Fukushima remain offline indefinitely.
An estimated 2 million homes are without power and about 1.4 million do not have running water. Equecat, a risk consultancy, estimated over the weekend that the economic losses from this earthquake would total more than $100bn (£62bn).
Analysts said one of the Bank of Japan's priorities was to advance "soft" loans to commercial banks to make sure they do not run out of cash as customers in the affected areas rush to withdraw savings. The central bank is expected to flood money markets with more cash than usual, partly to stop the yen from rising too much. Japanese firms and investors are racing to repatriate their assets, selling dollars and other foreign currencies, to prepare for the cost of rebuilding their domestic economy, which will push up the yen's value. It is feared this will make exports more expensive and choke off the hoped-for, export-led recovery.
David Buik at BGC partners said: "The Bank of Japan, I am sure, will be on high alert, doing everything in its power to stop the yen becoming too strong, as well as providing the banking sector with all the liquidity it may require.
"Japan's economy is export-led. So with such an inordinately large budget deficit, it will be imperative to get those factories open again." The bank has little scope to cut interest rates, as they are almost at zero. Economists said the bank was likely to hold fire on more drastic action while it assesses the economic impact 0f the disaster.
Daiwa Capital Markets, the Japanese-owned bank, said it was likely the economy would be pushed into recession, with exports particularly badly hit.
Economists had expected growth of 0.3% this quarter but now expect a second successive quarter of negative growth.
The huge cost of rebuilding the affected areas will push up Japan's public debt, which is already the largest among advanced economies. The Nikkei index, which fell 1.7% on Friday, is expected to post large falls when it reopens as the scale of the damage becomes clear. Some analysts warned it could tumble below the psychologically important 10,000 mark, which would represent a 2.7% drop from Friday's close, with one analyst at Toyota Asset Management telling Reuters it could fall below 9,000 soon.
Oil prices, which fell by 3% on Friday, are likely to continue falling this week. Japan is the one of the world's largest importers of oil but demand is likely to drop as industrial activity falters.
Strategists have been analysing the economic impact of Japan's last major earthquake, in 1995 near Kobe, for clues.
The Nikkei fell 8% in the first five days after that earthquake but then rose by 5% in the next 10 days. After the initial disruption, the economy grew by more than the trend growth rate at the time for 1995 and 1996.
Source:
http://www.guardian.co.uk/world/2011/mar/13/japan-economy-recession-earthquake-tsunami
The Bank of Japan is preparing to pump billions of yen into the economy when it announces an emergency "quake budget" on Monday to prevent the disaster derailing the country's fragile economic recovery.
Toyota and Nissan said they were halting production at all of their 20 factories. Toyota, the world's largest carmaker, evacuated workers from two plants in the worst affected regions and has not been able to reach the sites to inspect the damage. The plants make up to 420,000 small cars each year, mostly for export. Two of Honda's three plants remain closed.
Other manufacturers have also reported major damage to their factories, with Kirin Holdings, Fuji Heavy Industries, GlaxoSmithKline and Nestlé among those to halt operations. Sony, the electronics group, has suspended production at eight plants. At one plant, 1,000 workers had to take refuge on the second floor after the tsunami hit. All ports have been closed amid warnings of aftershocks to come.
Japan's utilities providers are warning of rolling blackouts across the country in the coming days because they are unable to meet electricity demand. Nuclear power generates about a third of the country's electricity but six reactor units at Fukushima remain offline indefinitely.
An estimated 2 million homes are without power and about 1.4 million do not have running water. Equecat, a risk consultancy, estimated over the weekend that the economic losses from this earthquake would total more than $100bn (£62bn).
Analysts said one of the Bank of Japan's priorities was to advance "soft" loans to commercial banks to make sure they do not run out of cash as customers in the affected areas rush to withdraw savings. The central bank is expected to flood money markets with more cash than usual, partly to stop the yen from rising too much. Japanese firms and investors are racing to repatriate their assets, selling dollars and other foreign currencies, to prepare for the cost of rebuilding their domestic economy, which will push up the yen's value. It is feared this will make exports more expensive and choke off the hoped-for, export-led recovery.
David Buik at BGC partners said: "The Bank of Japan, I am sure, will be on high alert, doing everything in its power to stop the yen becoming too strong, as well as providing the banking sector with all the liquidity it may require.
"Japan's economy is export-led. So with such an inordinately large budget deficit, it will be imperative to get those factories open again." The bank has little scope to cut interest rates, as they are almost at zero. Economists said the bank was likely to hold fire on more drastic action while it assesses the economic impact 0f the disaster.
Daiwa Capital Markets, the Japanese-owned bank, said it was likely the economy would be pushed into recession, with exports particularly badly hit.
Economists had expected growth of 0.3% this quarter but now expect a second successive quarter of negative growth.
The huge cost of rebuilding the affected areas will push up Japan's public debt, which is already the largest among advanced economies. The Nikkei index, which fell 1.7% on Friday, is expected to post large falls when it reopens as the scale of the damage becomes clear. Some analysts warned it could tumble below the psychologically important 10,000 mark, which would represent a 2.7% drop from Friday's close, with one analyst at Toyota Asset Management telling Reuters it could fall below 9,000 soon.
Oil prices, which fell by 3% on Friday, are likely to continue falling this week. Japan is the one of the world's largest importers of oil but demand is likely to drop as industrial activity falters.
Strategists have been analysing the economic impact of Japan's last major earthquake, in 1995 near Kobe, for clues.
The Nikkei fell 8% in the first five days after that earthquake but then rose by 5% in the next 10 days. After the initial disruption, the economy grew by more than the trend growth rate at the time for 1995 and 1996.
Source:
http://www.guardian.co.uk/world/2011/mar/13/japan-economy-recession-earthquake-tsunami
Linggo, Abril 17, 2011
AJ PEREZ DIES IN A CAR CRASH APRIL 17, 2011
He just finished a show in Dagupan, Pangasinan, which celebrated its annual Bangus Festival. His last tweet—which was posted four hours ago, or around 11:00 p.m.—read, "On the way home already from Dagupan.Long drive ahead.. Thanks to everybody who watched..."
Darlasauler.com stated that the Star Magic talent was with his dad, a security personnel, and a driver, at the time the accident took place.
Source:
Lunes, Abril 11, 2011
Scarcity of water in Metro Manila
Perennially, Metro Manila and its adjacent cities have counted on water from the various dams around it. So whenever there is a drought, the danger level goes up. And whenever there is too much— the capital sinks and drowns.
To see this as simply a Manila problem would be a failure to look at the big picture. The United Nations according to the BBC that each person needs 50 liters of water a day for drinking, washing, cooking and sanitation. Further, the story reported that the United Nations in 2000 projected that US$100 billion would be need to tackle water scarcity world wide.
According to this Inquirer article, authorities and water distributors are considering Laguna Lake a source of water for Metro Manila.
Is anybody asking that that move is just a stopgap measure?
Technological solutions
There are a number of technology solutions that could be used. First there is drip irrigation for irrigation. Second, treating of waste water so it could be drunk several times over is a way to conserve water.
Then there is Desalination, which isn’t new technology but has actually been around for years. It is the same technology used in US Aircraft carriers to provide water for the crew (because it could work in tandem with a nuclear reactor).
There are many countries that use desalination such as China and India.
Singapore has constructed a desalination plant and it uses a total of 4.2kWhr/m3 of energy. They are selling US$0.49 per cubic meter of water for the first year. The contractor they used— Black & Veatch did the design, support during construction and operation totaled US$90 million.
The French have constructed a desalination plant. It produces 320,000 cubic meters of drinking water per day. It cost 1.5 billion Euro between Veolia and an Israeli counterpart to cover the finance, construction and operation of the plant in a build operate and transfer scheme for 25 years.
Trinidad and Tobago built a US$120 million dollar plant that would process 28.8 million gallons of water per day. The plant is selling water at the price of US$2.67 per 1,000 gallons. At 46 pesos per one USD, that’s 122.82 pesos per 1,000 gallons of water.
Is Desalination the answer?
That said, there is an ecological cost to desalination and other side effects such as heavy use of energy and it leaves brine. What ecological considerations? For example in Australia, the facility there produces only 140,000 cubic meters of water per day and sucks in 0.1 meters per second of water to allow fish to escape.
Is desalination the answer?
How much water does Metro Manila really need? And if a facility is constructed to meet that demand, would the cost be affordable for people? How much would the cost of water then becomes for Juan dela Cruz?
Perhaps what is needed is a holistic approach. How does this affect the public years down the line.
And sadly yes, if you want water, you got to pay for it. The problem of water not just in the Philippines but for the rest of the world has few solutions and a lot of cost. What else could be done but to start using technology to our advantage— whether it is treating water or desalination or some other solution.
It seems to me that simply tapping Laguna Lake and looking at it as the ultimate solution is a stopgap measure and might not be the best idea. Yet in spite of that, even if a desalination plant is the solution, it would take years and much money to build— in the order of billions of pesos in magnitude but the choice to solve the future has got to start real soon.
source:
http://propinoy.net/2010/07/21/solving-the-water-problem-in-the-philippines/
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