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Knowledge "Knowledge is Power" goes the old German adage. But power, as any schoolboy knows, always has negative and positive sides to it. Information exhibits the same duality: properly provided, it is a positive power of unequalled strength. Improperly disseminated and presented, it is nothing short of destructive. The management of the structure, content, provision and dissemination of information is, therefore, of paramount importance to a nation, especially if it is in its infancy (as an independent state). Information has four dimensions and five axes of dissemination, some vertical and some horizontal. The four dimensions are: 1. Structure information can come in various physical forms and poured into different kinds of vessels and carriers. It can be continuous or segmented, cyclical (periodic) or punctuated, repetitive or new, etc. The structure often determines what of the information (if at all) will be remembered and how. It encompasses not only the mode of presentation, but also the modules and the rules of interaction between them (the hermeneutic principles, the rules of structural interpretation, which is the result of spatial, syntactic and grammatical conjunction).
In the economic realm, there are five important axes of dissemination: 1. From Government to the Market the Market here being the "Hidden Hand", the mechanism which allocates resources in adherence to market signals (for instance, in accordance with prices). The Government intervenes to correct market failures, or to influence the allocation of resources in favour or against the interests of a defined group of people. The more transparent and accountable the actions of the Government, the less distortion in the allocation of resources and the less resulting inefficiency. The Government should declare its intentions and actions in advance whenever possible, then it should act through public, open tenders, report often to regulatory and legislative bodies and to the public and so on. The more information provided by this major economic player (the most dominant in most countries) the more smoothly and efficaciously the Market will operate. The converse, unfortunately, is also true. The less open the government, the more latent its intents, the more shadowy its operations the more cumbersome the bureaucracy, the less functioning the market.
Positive information is characterized by four qualities: 1. Transparency Knowing the sources of the information, the methods by which it was obtained, the confirmation that none of it was unnecessarily suppressed (some would argue that there is no "necessary suppression") constitutes the main edifice of transparency. The datum or information can be true, but if it is not perceived to be transparent it will not be considered reliable. Think about an anonymous (=non-transparent) letter versus a signed letter the latter will be more readily relied upon (subject to the reliability of the author, of course).
There is no difference in the application of these rules to information and to interpretation (which is really information that relates to other information instead of relating to the World). Both categories can be formal and informal. Formal information is information that designates itself as such (carries a sign: "I am information"). It includes official publications by various bodies (accountants, corporations, The Bureau of Statistics, news bulletins, all the media, the Internet, various databases, whether in digitized format or in hard copy). Informal information is information, which is not permanently captured or is captured without the intention of generating formal information (=without the pretence: "I am information"). Any verbal communication belongs here (rumours, gossip, general knowledge, background dormant data, etc.). The modern world is glutted by information, formal and informal, partial and comprehensive, out of context and with interpretation. There are no conceptual, mental, or philosophically rigorous distinctions today between information and what it denotes or stands for. Actors are often mistaken for their roles, wars are fought on television, fictitious TV celebrities become real. That which has no information presence might as well have no real life existence. An entity person, group of people, a nation which does not engage in structuring content, providing and disseminating it actively engages, therefore, in its own, slow, disappearance. Kosovo, Economy of Should the United Nations administer Iraq? Is it - as Kofi Annan, its General Secretary, insists, the best-qualified to build nations? Or will it act as a bureaucracy out to perpetuate itself by preventing true transformation and indigenous rule? Kosovo is a lucrative post for more than 10,000 exorbitantly overpaid international administrators and perked consultants as well as 40,000 itinerant peacekeepers. The U.N. has been reasonably successful elsewhere both in peacekeeping and administration - notably in East Timor, Afghanistan and Sierra Leone. It widely thought to have dismally failed in Bosnia-Herzegovina. But the lessons of its involvement in Kosovo - the second longest and least reserved - may be of particular relevance. In the wake of NATO's Operation Allied Force in 1999, Kosovo was practically severed from Yugoslavia and rendered a U.N.-protectorate under resolution 1244 of the Security Council. UNMIK (United Nations Mission in Kosovo) was formed to serve as the province's interim administrator. It was charged with institutions-building and a transition to self-governance by the now overwhelmingly Albanian populace. Its mission was divided to four "pillars": Police and Justice, Civil Administration, Democratization and Institution Building (overseen by the Organization for Security and Cooperation in Europe) and Reconstruction and Economic Development (managed by the European Union). Four years later, Kosovo has its own government, installed last month - and a viable police force. UNMIK had to spent the first 18 months of its mandate re-establishing basic services in a land scorched by 78 days of massive bombardment. It also put in place the rudiments of a municipal administration. A parliament and presidency followed. Surprisingly resilient, they survived two - bloodied - elections. The U.N. is planning to transfer, over the next few months, many of its "competencies" to the three-party broad coalition in power. Last month, a transfer council was established to manage the transition. But Kosovo is an unsettled place. Its status is unresolved. Is it to be independent, as its legislators demand - or an inseparable part of Serbia, as the late assassinated Serbian prime minister, Zoran Djindjic claimed? UNMIK's travel documents and its license plates, for instance, are still not recognized by many countries. Investors - including wealthy diaspora Kosovars - are deterred by this uncertainty and the social and civil unrest it fosters. Had it not been for KFOR, the 35,000-strong NATO-commanded military detachment, Kosovo might well have reverted to civil war, or crime-infested anarchy. That, astoundingly, Kosovo has no law to deal with foreign investment does not help. Partly because of that, Kosovo's economy is still a shambles. The United Nations - and the acronym soup of multilateral development banks, aid agencies and non-governmental organizations that descended on the region - failed to come up with a coherent plan for endowing Kosovo with a sustainable economy. Where UNMIK, with European Union assistance, did intervene - in setting up institutions and abetting economic legislation - it has done more harm than good. The establishment of workers' councils, for instance, inhibited the proper management of socially owned enterprises and rigidified the budding labor market with dire consequences. One in two Kosovars is unemployed. Whatever activity there is, is confined to trading (read: smuggling), retail and petty services. The wild construction or reconstruction of 250,000 houses wrecked by the war is fizzling out and the absence of both mortgage financing and a sizable domestic industry of construction materials are detrimental to the sector's viability. Tenders for complex infrastructure jobs are usually snatched by foreign competitors. Reputable Kosovar-owned construction multinationals hint at discrimination and worse. But the business segment of the economy is illusive and dilapidated. Of 861 socially-owned firms identified by the International Crisis Group, only 330 are viable, according to UNMIK. Kosovo has no private sector to speak of - though it has registered 50,000 small and medium, mostly paper, typically ad-hoc, enterprises. Of 2774 members of the Kosovo Chamber of Commerce - 1667 were fly-by-night construction outfits. The majority of economic assets are still in public or "social" hands. In an interview granted to the Far Eastern Review last year, Ali Jakupi, Minister of Trade and Industry of Kosovo, diplomatically pointed the finger at UNMIK's glacial pace of reform. Land ownership is a contentious issue. The privatization of utilities is a distant dream, despite the creation of the Kosovo Trust Agency, a convoluted attempt to dispense of certain assets while skirting the legal no man's land which is Kosovo. Despite all efforts, commercial law is scant and poorly enforced. No one understands why the number of commercial bank licenses is limited, why, until recently, UNMIK worked only through one bank and why establishing an insurance company is such a harrowing - and outlandishly expensive - ordeal. Kosovo is the only place on earth where price cartels (for instance, in the assurance sector) are not only legal - but mandatory. Kosovar banks still keep most of their clients' deposits abroad for lack of an indigenous legal framework of collateral and bankruptcy. Interest rates are prohibitively high and repayment terms onerous. The only ray of light in a decrepit financial system is the euro, Kosovo's official currency and a source of monetary stability and trust. The new Ministry of Finance and Economy has introduced customs duties and a few taxes with modest success. But the government's revenue base is pitiful and a Byzantine, import-biased, tax law makes export-oriented manufacturing a losing proposition. Kosovo's trade deficit is almost equal to its gross domestic product. Had it not been for generous remittances from Kosovar expats and immigrants - pegged at $1 to 1.5 billion a year, the province's economy would have crumbled long ago. Nor has Kosovo's infrastructure been rehabilitated despite the $5 billion poured into the province hitherto. Electricity, for instance, is intermittent and unpredictable. The roads are potholed and few, the railways derelict. Fixed line penetration is low, though mobile telephony is booming. This sorry state was avoidable. Kosovo is not as poor as it is made out to be by interested parties. It has enormous lead reserves, coal and lignite veins and loads of zinc, silver, gold, nickel, cobalt and other minerals, including rumored mines of uranium. The territory actually used to export electricity to both Macedonia and Montenegro. Official statistics ignore a thriving informal economy, encompassing both the illicit and the merely unreported. Kosovo is a critical node in human trafficking, cigarette and oil derivatives smuggling, car theft and, to a lesser, extent, drugs and weapons trading networks. Revenues in service businesses - cafes, restaurants, gambling institutions, prostitution - go unreported. Kosovo is one of the global centers of piracy of intellectual property, notably software and movies. The Central Fiscal Authority of Kosovo estimated that, in 2001, duties and taxes were paid only on $590 million worth of imports (at the time, c. $540 million euros) - only about 30 percent of the total. These figures are proof of the entrepreneurial vitality of the Kosovars and their aversion to state interference. USAID chief Dale Pfeiffer praised Kosovo, in an interview granted to the daily paper, Koha Ditore: "There is bureaucracy, there is a corruption, but if we compare with neighboring countries, it seems to be at a lower level. Since 1999, Kosovo is building its own new governmental structures. Mainly, your government is more modern than government in Serbia, Macedonia or even Bosnia. I think that corruption is not even same at the level as neighboring countries. Although corruption is something that can grow very easily, currently it doesn't seem to be a big obstacle for businesses." Still, he reverted to typical counterfactual condescension. Federal Yugoslavia, of which Kosovo was a part, was a modern state, more advanced than many EU members. Yet, Pfieffer professed to be worried. "Day by day, more competencies are being given to the Kosovo Government. My concern is, does the Government have the ability to manage its own competencies. I think there should be a balance; you must gain competencies which can be applied." Many observers think that had it not been hobbled by the indecision and overbearing officialdom of the international community, Kosovo would have fared better. Even evident economic assets - such as nature parks, vineyards and ski slopes - were left undeveloped. Because it hasn't met EU regulations - Kosovo is unable to export its wines, juices and agricultural produce. But to hold this view is to ignore UNMIK's contribution to the containment of organized crime - mostly imported from Albania and Macedonia. Admittedly, though, UNMIK failed to defend minority rights. Kosovo has been ethnically cleansed of its Serbs. The UN High Commissioner for Refugees (UNHCR) and OSCE warned last month that minorities "continue to face security problems and lack access to basic services (such as) education, health services and equitable employment." Kosovo teaches us lessons which should be diligently applied in Iraq. The involvement of a long-term active military component intended to guarantee basic law and order is crucial. U.N. administrations are good at reconstruction, rehabilitation - including humanitarian aid - and institution-building. But they are utterly incompetent when it comes to the economy and to protecting minorities from the majority's wrath. Pecuniary matters are best left to private sector firms and consultants while helpless minorities better start praying. Worse still, as opposed to an occupying army, whose top priority is to depart - U.N. bureaucracies fast gravitate towards colonialism. The U.N.-paid and U.N.-sanctioned rulers of both Kosovo and Bosnia-Herzegovina exercise powers akin to erstwhile British viceroys. Nor do they have any incentive to terminate their position - gratifying as it is to both their egos and their wallets. UNMIK is the reification of the concept of conflict-of-interest. If it succeeds to render the natives economically and politically independent - it is no longer needed. If it fails - it survives on a bloated budget. To be an international official in Kosovo is to endure the constant clashes between one's professional conscience and one's propensity to live the good life. Only saints win such battles. Whatever UNMIK is - it is decidedly not saintly. But, as Augustin Palokaj, Brussels correspondent for Koha Ditore, notes, comparing Kosovo to Iraq can go too far: "Kosovo has no oil and one-third of the population of Baghdad, and it is not interesting for investments ... Iraq will have an easier time when it comes to political status. Iraq is, and will remain, a state. It is still not known what Kosovo's fate will be. Unlike in Kosovo, there will be both aid and investment in Iraq. The Iraqi people will decide on the status of their country, whereas the Security Council, that is to say China and Russia, will decide about Kosovo." And does he think the United Nations should administer a postwar Iraq? "The UN would only complicate things, but the Americans will give it a role, just for the sake of it, which will satisfy the bureaucrats that must get their huge salaries. Americans are also aware of the danger that if the UN takes over the administration of postwar Iraq ... criminals from various countries would be infiltrated into Iraq, as they have done in Kosovo. How can peace be established by an organization whose policemen allowed eight war crimes suspects to escape from prison, as happened to UN policemen in Kosovo. Instead of feeling shame for such things, the chiefs of UNMIK Police produce propaganda about their successes. The key American role in postwar Iraq will prove what was learned from Kosovo." Kyoto Protocol The 185 member states of the United Nations Climate Change Convention met last week in New Delhi to contemplate what steps may be needed to implement the Kyoto protocol, already ratified by 95 countries, including the European Union. Signatories have ten years - starting in 2003 - to cut their emissions of greenhouse gases. In the decade or so of transition, the countries of central and eastern Europe have suffered droughts and floods in equal measure. They attribute this shift in climate patterns to global warming. Ironically, the crumbling of their smokestack industrial infrastructure reduced their emissions by 38 percent between 1990-2000, according to a report presented at the conference. In Estonia, transition's poster kid, emissions declined by 56 percent, according to ETA, the news agency. The OECD countries increased theirs by 8.4 percent over the same period. This disparity between rich and poor nations in Europe casts a cynical light over the European Union's constant environmental castigation of east Europeans. The EU adopted the Kyoto protocol in May and committed itself to a total reduction of 8 percent of emissions by 2012. Even if wildly optimistic forecasts regarding car usage and the restoration of central and east Europe's manufacturing base are met - emissions would still be well in compliance with annex I of the Kyoto protocol, which lists the reductions required of the candidate countries. This cannot be said about the current members of the European Union and other rich, industrialized polities. Lawmakers in the former communist bloc are aware of it. Quoted by Radio Free Europe/Radio Liberty, the Russian Federation Council Science, Culture, Education, Health, and Ecology Committee Chairman Viktor Shudergov told the news agency Rosbalt three weeks ago: "We must calculate and anticipate the maximum possible improvement for our own industry so that in a few years we don't find ourselves purchasing (pollution) quotas. Russia is currently the world's major supplier of oxygen in the atmosphere. Other countries are using Russia's biological resources to develop their industries. The USA has every possibility to reduce its own emissions but refuses to do so. It would have been more useful if the main source of ecological pollution, the United States, had participated." Central and east Europeans have a few things going for them as far as the environment goes. Public transport is more developed in the countries in transition than in the rest of the continent. Industry - rebuilt from scratch - invariably comes equipped to minimize pollution. Private cars are less ubiquitous than in Western Europe. Vast swathes of countryside remain virtually untouched, serving as "green lungs" and carbon sinks. If, as the European Commission envisions, a community-wide regime of emissions-trading is established, the countries east of the Oder-Neisse line could well benefit as net sellers of unused quotas. According to Ziarul Financiar, a Romanian financial newspaper, last year, the government of Romania negotiated the sale of some $20 million in carbon dioxide emission rights to Japan. A similar deal - this time for c. $4 million - was struck with the Swiss. The money was used to refurbish the decrepit central heating systems in a few townships. The interesting twist is that the very enhancement of the energy efficiency of the antiquated pipelines freed for sale portions of the emissions quota. It is telling that Romania was unable or unwilling to sell its emissions to the United Kingdom, Denmark, or the Netherlands, all three of which host functional emissions-trading pilot projects. The trading rules are so complex - certain sectors and gases are excluded and fiendishly intricate auctions regulate the initial allocation of quotas - that many potential buyers and sellers prefer to abstain. Estonia circumvented the nascent exchanges altogether. It convinced the Dutch, Finns, Germans, and Swedes to invest in reducing carbon dioxide emissions in Estonia. The reductions, according to the Baltic News Service, will be applied to the quotas of the investing nations. Still, the political leadership of most countries in transition understands that it has at least to be seen to be supportive of the Kyoto process. Russia announced in the World Summit on Sustainable Development in Johannesburg in September its intention to ratify the protocol by the end of the year. It will also host next year's International Conference on Climate Change. Its Prime Minister Mikhail Kasyanov boasted of a one third reduction in emissions in recent years. Environment ministries - a novel fixture - have proliferated throughout the region and, backed by the international community, have become assertive. The Croat minister of environment, for instance, warned his own government in March, in his first national report on local climate changes, of international sanctions due to a considerable increase in the emissions of noxious gases since 1990. According to the Regional Environmental Center for Central and Eastern Europe, many countries in the region - including three New Independent States, Ukraine, Bulgaria, and the Czech Republic - have completed national climate change action plans. Hungary, Kazakhstan and Russia are preparing theirs. The BBC says that Slovenia is working on a program of its own, though in compliance with the Kyoto requirements. Less scrupulous politicians regard the environment as another way to extract funds from Western governments and multilateral lending institutions. Especially active are the European Bank for Reconstruction and Development (EBRD) and the World Bank. The former approved $12 million to Vetropak Straza, Croatia's only glass factory. The money will be invested in a new technology with less harmful emissions. Together with Citibank, the EBRD is committed to financing the $470 million conversion of the Bulgarian thermal power plants, Maritsa 2 and 3 to more efficient and less polluting coal burning. The Bank is collaborating with the Dutch to establish a carbon credits market exclusive to its client states - the countries of central and eastern Europe and the Balkan. Pollution-phobic European countries - mainly in Scandinavia - work with the World Bank and match its funds in specific environmental undertakings. Thus, the Danish Agency of Environment has financed 13 projects in Bulgaria last year, part of $18 million it has granted that country alone since 1995. It is now assisting Bulgaria in its application for world Bank funds to counter the effects of past pollution. |
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