Denial in Switzerland: Xenophobia Rears Its Ugly Head, Denounce the Anti-Minaret Vote

Denial in Dubai

The financial turmoil in Dubai this week provides yet more motivation for Globophobe to post. We first went to the emirate exactly eight years ago to work on a conference organized by the office of the Ruler of Dubai, Sheikh Mohammed Bin Rashid Al Maktoum. The Dubai Strategy Forum was meant to be an opportunity for the local business community to listen to and learn from top global strategists and thinkers such as John Naisbitt, John Gage, Paul Kennnedy, John Kao, and Dani Rodrik. The event went well and the participants seemed energized by the sessions which covered topics including high-tech innovation, entrepreneurship, culture and values in a globalized world, and the global economy.

In 2001, Dubai was not yet the vast construction site that it is today. Globophobe was in Dubai last week just as the current turmoil was brewing. Looking out the window of a high-rise apartment, a friend remarked that it is impossible to view the city skyline and not see a cluster of buildings under construction. Another friend who lives in Dubai noted that not all the construction sites were active, as a number of projects have been halted due to the economic crisis. Indeed, Dubai today is like a movie set - a lot of lights and fancy scenery for the eye to take in, but behind the facade, the reality is somewhat different. The revelations about the debts of Dubai World belie the image of Dubai as this dynamic can-do city that is building its way to global greatness.

Globophobe is no Gulf region expert - and neither are we intimate with all the details about Dubai's history and development. But as the news broke about Dubai's debt woes, we recalled our thoughts eight years ago on first becoming acquainted with the emirate:

First, it struck us then that the business community seemed enthralled by Sheikh Mohammed, the ruling family and his courtiers. Because sessions at the conference in which the Sheikh would be present could not start until he arrived, panel discussions ran late. To a man, everybody dutifully stood up as soon as the Sheikh entered the room and did not sit down until he had sat down. Practically every speaker from Dubai made reference to the munificence of the Sheikh, thanking him for giving the business community the opportunity to learn from the great global thinkers.

Second, the centrality of Sheikh Mohammed in the consciousness of the Dubai business community, it seemed to us, was accompanied by an overwhelming focus on state leadership. Many of those who posed questions to the speakers would ask what the government could or should do - how can the government promote entrepreneurship? how can the government stimulate creativity and innovation? how can the government turn Dubai into a global city? The idea that government was the source of all the solutions was so often repeated that Globophobe, when asked by a local resident what we thought about the conference, this was the first comment we made: that it seemed to us that the Dubai business sector relied too much on guidance from the state.

Third, several times during the conference discussions, Singapore was mentioned as a model for Dubai to follow. Few if any talked of Hong Kong as an economy to emulate. This only underscored for us how the government was the dominant player in Dubai and how the business community took all its cues from the state and looked to the state to lead it to the promised land of global city status. The businesspeople seemed to think that it was up to the government to lead the way even when it came to promoting entrepreneurship.

Finally, Dubai was already looking somewhat unreal to us. We stayed briefly at the Emirates Towers hotel, part of a twin-tower development that was home to the Sheikh's office. It seemed odd to have such a glass-encased skyscraper - kept ultra cool by airconditioning - in such a hot, sunny place, a desert. Many of the hotel staff were not in fact from Dubai but were Filipinos or South Asian. To us, it all seemed illogical: a city of immense wealth where the ruling family is at the core of everything, the locals are far too rich to be willing to do even middle-level service jobs, and even the highly educated business class looked to the government for instruction. On top of all this, a glass-and-steel fantasy film set was under construction.

Globophobe recalls telling a local Dubai associate that this all seemed unsustainable. Dubai should be emulating Hong Kong, not Singapore. In the globalization age, Singapore's state-centric model is untenable. Singapore's leaders know that and have been trying to lessen government intervention. Old habits die hard and the Singaporean government remains at the core of the city's commerce and the consciousness of its business community and the population in general. It will take a generation to change the mindsets of its people and policymakers.

The statist gene is similarly in Dubai's DNA and it will take a long time to switch it off. Meanwhile, the denial continues. Now, Globophobe is all for benevolent authoritarianism so long as it produces results for the people and gradually introduces democratic reforms. But from what we hear, Dubai makes Singapore look like Hong Kong when it comes to the dominance of the state and the state's domineering attitude towards its people. And there remains this troubling sense among the local population that they possess a status in everyday life above that of visitors and foreign residents. Globophobe has seen local people in Dubai and elsewhere in the Gulf cut queues without so much as a nod to the simple folk they have left in their wake. Any traveller arriving at an Gulf airport on an airline from the region has seen the luggage (often rather considerable in bulk and number) of some "privileged" passenger roll on to the carousel ahead of everybody else's. Globophobe is all for VIP treatment, but it is disconcerting to see primus-inter-pares treatment for regular people solely because of their ethnicity.

In Dubai, the public reverence for the rulers continues. At the conference that we were attending last week, when Sheikh Mohammed appeared, all were upstanding. The Sheikh and his retinue, of course, sat on special armchairs in the front row. Dubai's ruler was accompanied by his son, Sheikh Hamdan, the 27-year-old crown prince, who was introduced as an accomplished equestrian and poet. He apparently has a passion for fast - and expensive - cars including Porsches, Lamborghinis and Ferraris. As we watched the young prince speak while the grandees of the Dubai business community hung on his every word, we wondered whether Dubai - or any such fiefdom - can make it in the age of globalization, the age of the Internet, if it remains so much in the thrall of one family and a ruling elite - emperors who turned out to have no clothes.

Denial in the Philippines

The massacre of 57 people in Maguindanao this week was so atrocious and senseless that Globophobe feels compelled to post a comment, something that we have not had much time to do of late. Among those killed were a dozen journalists. This has made the Philippines the most dangerous place in the world for reporters. The slaughter will be a shameful blot on the image of the country for many years to come. At this point, given the country's track record, the likelihood of any real justice for those who were murdered is very low. In this society where the politically and economically powerful enjoy impunity from the law, maybe some underlings will be found guilty, but the masterminds will probably get off - or be put in a jail where they live in comfort. After all, despite the plundering of the nation by its leaders since the beginning of the republic, few if any have actually paid for their evil deeds. To quote Tennyson, we are "a savage race".

But as Globophobe frequently says about revelations that are not in fact revealing, this is not news. Philippine politics is all about clans, families that claim mayorships, governorships, congressional seats and even the presidency as their birthright. They may wish to serve the public but to them, public service means that they must get a cut. In many cases, these potentates rule through the barrel of a gun, or more likely semi-automatic rifles. They maintain private armies and think nothing of wiping out adversaries large or small. They are warlords in a semi-feudal society.

The elite in the Philippines - the technocrats, the business leaders, the educated middle class - is in denial about this very dark side of the nation. They see the progress the nation has made in recent years and believe that the country has left its brutish past behind. A few years ago, when Globophobe used the term "semi-feudal" to describe the Philippines in a published article in a regional news magazine, we received a phone call from one of the top business tycoons, a US-educated denizen of Forbes Park, who proceeded to give us a tongue lashing for using that word. But how else can one explain a heinous act such as the Maguindanao massacre?

Time has come for Filipinos to stop denying that this darkness in our society exists or that there is nothing that can be done about it. Hold the country's leaders accountable. Keep putting pressure on them until there is real justice in the land. The people have to turn their backs on those who deny and those who do not deliver. Put a stop to the reign of political dynasties and rule by guns, goons and gold. The first step: end the denial, admit the problem, and cease the idle resignation. Something can be done and has to be done now.

Back in Davos

Globophobe has been absent for some time, but now that we are back in Davos for the 39th World Economic Forum Annual Meeting (the 12th time we have attended), we are once again online. Right now, we are watching a session entitled "The New US Administration: Can It Meet the Expectations of the World?" This panel discussion is being filmed by CNN for broadcast "as live" for a program called "Dateline Davos: Obama's World", which is hosted by Christiane Amanpour.

Who is on the panel? There are six leaders: Mohamed M. ElBaradei, Director-General of the Internatonal Atomic Energy Agency (IAEA); Bernard Kouchner, Minister of Foreign and European Affairs of France; Manouchehr Mottaki, Minister of Foreign Affairs of the Islamic Republic of Iran; Raila Amolo Odinga, Prime Minister of Kenya; Abdul Rahim Wardak, Minister of Defence of Afghanistan; and Hoshyar Zebari, Minister of Foreign Affairs of Iraq.

To be sure, an interesting mix of political leaders. But why the focus on the Middle East? Why no leader from Asia east of Afghanistan? The most important bilateral relationship in the world is between the US and China - so why no Chinese panelist? What about Japan? India? Yet again, we see the media's narrow coverage of US foreign policy. American media outlets like CNN focus on American involvement with the countries of the Middle East and maybe Europe, but do relatively little on economically and politically more important relationships in Asia. Odinga seems to be just an afterthought to round out the panel. Forty minutes into the session, Amanpour has only conversed with him for a few minutes at the start of the program. Most of the rest of the time has been spent on discussing Iran, Iraq, Afghanistan and the Arab-Israeli conflict. We guess that must be what CNN considers to be "Obama's World".

Obama's So-Called "World" Tour: Why Not China?

The mainstream U.S. media is covering Senator Barack Obama's tour to the Middle East and Europe as if he were already the president. Journalists call it a "world tour" but it could hardly be that. Like all the American politicians before him, Obama's world view is focused on the conflict in Middle East and the trans-Atlantic relationship with Europe. Yet the most important bilateral relationship that the U.S. will have this century will be with China. We would bet Obama isn't going there anytime soon. And what about India? Unlikely.

This is disappointing. If Obama really wants to change America and bring a fresh perspective to U.S. foreign policy, he needs to break the Beltway's captivation with the Middle East and Europe and stress to Americans that they must pay as much if not more attention to strengthening ties with Asia, particularly China and India. Unfortunately, it looks like an Obama government will be yet another administration that focuses more on the alliances of old without thinking more deeply and strategically about relationships of the future. At least George W. Bush knows enough to see the benefit of traveling to China next month for the opening ceremony of the Olympics. From Obama, expect some hackneyed anti-China diatribe during the Olympic fortnight. So much for "change you can believe in."

Up the Magic Mountain - Again

Globophobe is once again in Davos - our 11th time to this Swiss ski resort that becomes globalization central for one week every January when more than 2,000 business, government and civil society leaders converge in this non-descript linear town with stunning mountain scenery. It has been snowing all day today, heightening the anticipation. Tomorrow, the World Economic Forum's Annual Meeting 2008 begins. 

We tend to be quite busy during the meeting, but Globophobe will do our best to post a few observations as this jamboree proceeds.

Season's Greetings - and Happy New Year!

To Our Readers,

Best wishes to you and your families for the holiday season and for a Peaceful and Prosperous New Year!

Globophobe

Bullied but Unbowed

This has been a difficult week for Globophobe. We were accused by somebody high (well, physically not that high) and mighty of lying not just once, but twice. The first time this fellow made the accusation was in a letter to a third party with whom he has been engaged in a nasty public feud. Globophobe had intervened to set the record straight, but instead of accepting our explanation, this person, whom we have known for nearly 20 years and had thought was a friend, accused us of lying in the letter which he released to the media.

Now, Globophobe is always ready to defend our honor. So we sought to provide our accuser with the explanation for his misunderstanding. Instead, our bull-headed friend-turned-adversary accused us of lying a second time, alleging some kind of Nixonian cover-up! (If I'm Nixon, then this guy has got to be George W Bush - arrogant, single-minded and dumb.) At this point, we had one hand in a clenched fist and the other reaching for our lawyer's speed-dial button. But the counsel of friends calmed us down and we decided to continue on the high road and ignore our petty bully. Besides, this powerful man, a local tycoon, has quite a bit more financial resources than we do and could probably outspend and outlast any legal barrage that came his way.

Still, we are seething. We know the truth - and it has set us free. But our reputation has been sullied and this self-absorbed Napoleon gets away with lobbing unsubstantiated accusations in public, which he made without even seeking clarification. He is simply a bully, a petulant child, someone whose own stained record (Does Enron ring a bell? Hint: Think audit committee.) gives him no moral authority to self-righteously and wantonly accuse others of dishonesty.

For now, we will ignore him and move on. Globophobe draws inspiration from a six-(almost-seven-)year-old kid we know who was himself recently the victim of bullying. He was pinned against a fence by some of his mates because he had professed not to believe in God, a truthful admission that his tormentors, who possibly thought themselves more worldly or sophisticated because they had been baptized or were made to adopt a faith by their parents, could not accept. They couldn't handle the truth and were too closed-minded or arrogant - if only during that encounter - to accept that they are not always right.

Well, the little boy got out of the scrape, rescued by a teacher. The bullies were made to admit their transgression to their parents and to write a letter of apology to the child they harassed. A few days later, the same children were playing together again, as if nothing had happened. And what about our six-year-old friend? It was no big deal, he told his parents. He brushed it off as much ado about nothing. But if it were to happen again, he said, he wouldn't be happy.

Globophobe can only admire such pluck. This courageous young man would not let playground bullies get him down. And so shouldn't we. Our accuser is nothing more than one of those playground bullies in life who comes around every so often to bug us. In the end, when he harms others, he really only hurts himself. By making patently false accusations and then adamantly refusing to accept that he has erred, our bully only digs his pathetic little self deeper into that dark hole where all hapless bullies eventually end up.

Globalization at the Movies: "You make me want to be a better economy"

When we talk to people about globalization and its impact, we often discuss how China's rise shouldn't cause its competitors to lose hope. The key is for other economies to figure out how to take advantage of the opportunities China offers and how to better compete. It's a matter of pursuing the reforms, restructuring and retooling necessary to survive, whether that means going up the value chain or creating new innovative products and services. Globalization, in our view, is all about that pressure-reaction dynamic - the winners will be those that want to become better economies, companies, individuals once it dawns on them that they aren't that competitive anymore. Can they take the tough medicine?

All of this is neatly summed up in the following dialogue form the film As Good As It Gets, which starred Jack Nicholson as Melvin Udall, the author suffering from obsessive-compusive disorder, and Helen Hunt as Carol Connelly, the long-suffering coffee shop waitress, to whom Melvin is attracted. The two go out on a date and Melvin's behavior is frustrating for Carol. She demands that he pay her a compliment:

Melvin: I've got a really great compliment for you, and it's true.
Carol: I'm so afraid you're about to say something awful.
Melvin: Don't be pessimistic, it's not your style. Okay, here I go: Clearly, a mistake. I've got this, what - ailment? My doctor, a shrink that I used to go to all the time, he says that in fifty or sixty percent of the cases, a pill really helps. I *hate* pills, very dangerous thing, pills. Hate. I'm using the word "hate" here, about pills. Hate. My compliment is, that night when you came over and told me that you would never... well, you were there, you know what you said. Well, my compliment to you is, the next morning, I started taking the pills.
Carol: I don't quite get how that's a compliment for me.
Melvin: You make me want to be a better man.
Carol: ...That's maybe the best compliment of my life.
Melvin: Well, maybe I overshot a little, because I was aiming at just enough to keep you from walking out.

When the China juggernaut appears, the survivors - the winners in this age of intense globalization - will be those economies that want to take their medicine and look China in the face and say "You make me want to be a better economy" rather than haplessly sulk in self-pity, inefficiency and odd behavior.

Catching Hypocrites - But What About the Terrorists?

The Senator-Playing-Footsie-in-the-Men's-Room scandal is troubling to us. Not because the "sex sting" uncovered potentially lewd behavior in a public toilet, though we guess we should be thankful for that. No, what bothers us more is that, with all the talk of terror threats at airports, the police in Minneapolis-St Paul are still able to deploy a big-gun officer undercover to root out lasciviousness lurking in the loo. Instead of "the guy that we get out of the 'hood", as the arresting officer put it, the operation trapped a big, fat ("fairly wide guy", as the hapless Senator Craig described himself) hypocrite.

America and the world are safer today with another disingenuous politician disgraced. Meanwhile, the war on moisture continues - and Osama traipses around the netherworld between Pakistan and Afghanistan, trundling along with his dialysis equipment and evading capture or bombing. The US continues its adroit handling of General Musharraf, its pointman in Pakistan, by forcing him to enter into a devilish deal with the discredited Benazir Bhutto, a corrupt former prime minister now deemed to be a necessary evil in what we suppose to be Washington's "cunning plan" to ensure stability in that critical frontline state.

So fairly-wide-guy-senator is goaded into resigning by his fraidy-cat Republican colleagues worried about their re-election prospects, while the man whom they should be dumping sits in the White House still, dreaming up ways to mess more things up over the next 16 months. And in airports across the United States, gung-ho police officers are trawling toilets for that insidious menace to the American way of life - the elected hypocrite.

Welcome to the United States of America! Be Patient!

Over the past three years, we have been splitting our time between Asia and America, using two bases - Hong Kong and New York. We haven't really spent that much time in either city because our work means that we travel almost six months a year. Going in and out of the United States as often as we do, we have noticed how entering the country has become more and more of a nuisance. The immigration and customs procedures at New York (JFK), Los Angeles (LAX) and Chicago (ORD) can be quite tedious, particularly for a foreigner arriving on a foreign carrier that is normally filled with other foreigners (The planes of American carriers tend to have more Americans on them).

To be sure, other airports around the world are nowhere near as smooth sailing as either Singapore or Hong Kong. (We should note that Globophobe has the advantage of holding a permanent Hong Kong ID card so we can breeze through immigration at Chek Lap Kok.) Heathrow can be horrible for most of the day as this youtube.com clip amply demonstrates. At peak times, Tokyo, Beijing and India's main airports - Delhi and Mumbai - can be frustrating. But we dread the US airports more than the others for three reasons.

First, the climate of fear in America is such that any arrival feels very much under suspicion. The US has tightened its visa policies and requires most foreigners to be digitally fingerprinted and photographed. Making matters worse, homeland security officers are typically humorless, even rude, but the visitor dares not say anything critical or mildly sarcastic in case it should jeopardize entry.

More troubling is the second reason why we find US airports a pain: US immigration officers seem less and less skilled. We have found from our experience that more officers do not even know basic rules. Globophobe travels on a Canadian passport but several times we have encountered immigration agents who do not understand the special relationship that the US and Canada have and the conditions that apply to Canadian visitors, eg in most cases, they do not need to acquire a visa before arrival. We have on a couple of occasions been required by an officer to fill in an I-94 form, which Canadians generally do not need to complete to gain entry. On other occasions, when entering on a J-1 "exchange visitor" visa, the officer simply did not know how to process such an arrival and gave up, leaving the task to the secondary inspectors in the back room. One time, we ourselves had to instruct an officer on how to process our papers. Initially, this young man wasn't even going to stamp our passport!

The third reason for our dislike of the US arrival process is that American airports typically are badly designed, uncomfortable and not really user-friendly. There are exceptions, of course. We prefer to arrive at Newark's Liberty International over JFK - it's more spacious and airy and the queues seem to move more quickly. If JFK it has to be, then it is usually better to arrive at one of the newer terminals such as T4. It can be much more pleasant to fly into a little used international gateway. We once flew into Las Vegas on a Japan Airlines flight from Tokyo and zoomed through immigration, baggage claim and customs. But for the most part, the poor design of US airport terminals contributes to the slow processing. There are also other problems such as the lack of immigration officers and the occasional computer glitch (read this wire story on yahoo.com).

Because of all these difficulties, it is wise to allocate at least two hours to transit through an American airport. Three or more hours would be much better - and safer - to allow for late arrival, processing delays, terminal transfer if necessary, and security. If you have too tight a transit and miss your connection, you may encounter difficulties, particularly at this time of year when flights are full. Fail to make a flight and you may have to wait hours, maybe even a day or more, to get on the next one.

US authorities should learn a lesson from the debacle at Heathrow. London's gateway has gained a bad reputation among passengers, even though statistics suggest that some of the gripes are unfair. (Read this Economist article on "Britain's Awful Airports".) Thank goodness that Heathrow's Terminal 5 will be opening early next year. (Check out this youtube.com clip to see how the state-of-the-art terminal looks.) Before the situation seriously deteriorates in the main American gateways, the US should look at how they can make the passenger's arrival a more comfortable and efficient process. If the US government is determined to be less welcoming to foreigners, at least they should make those who do arrive at their doorstep and gain entry feel like guests and not intruders.

The Death and Life of Hong Kong: Eating Crow

Twelve years ago, Fortune Magazine roving reporter Louis Kraar wrote a startling cover story that was meant to provoke. "The Death of Hong Kong" issue so stirred up the city's business elite that they set up The Better Hong Kong Foundation, an organization aimed at countering the perception that the 1997 handover of sovereignty over the territory by the British back to the Chinese would mark the end of Hong Kong.

Ten years after the handover, Hong Kong is alive and well and Fortune has now repented for their dire prediction. Sadly, Lou Kraar, who was a wonderful gentleman and great journalist, died a few years ago and is not around to see for himself how Hong Kong has managed to survive. Sure, the city has its problems - the environment is one major one - but on its deathbed? Not on your life!

Here are links to the 1995 story and Fortune's nostra culpa piece written by another veteran Asia hand and author Sheridan Prasso.

Read Lou Kraar's Fortune Magazine story on "The Death of Hong Kong" on cnn.com

Read Sheri Prasso's Fortune Magazine story "Oops! Hong Kong is Hardly Dead" on cnn.com

Handover Hangover: What Were We Doing a Decade Ago?

Ten years ago on 1 July, China resumed sovereignty over Hong Kong. We were there - from the firing of the Noonday Gun on 30 June to the firing of the Noonday Gun 24 hours later. Globophobe was the last reporter to leave the Convention Centre - after all the new leaders of the Hong Kong SAR government had boarded their limos to go home around 4 am. We think that the following is the best coverage of the handover produced by any news team at the time (even though a lot of good reporting never made it to print):

http://www.asiaweek.com/asiaweek/97/0620/index.html
http://www.asiaweek.com/asiaweek/97/0711/index.html

Check it out.

The Saga of the Lost Bag - and What to Do About Delayed Luggage

As Globophobe's loyal readers (all three of you!) know, we travel a great deal. Currently, we are at the tail end of a business trip that started in mid-May. Not to bore you or dazzle you with our itinerary, but suffice it to say that we have been bouncing between continents and have touched down in Asia (including the Middle East) three times, Europe three times (four before we're through), Africa once, and in between managed to spend four days back in the US - three in Washington, one in New York. On that one day in New York, we barely managed to get a some laundry done and to do some necessary errands such as pay bills. The last two months have been a whirl.

The most testing part of the trip was the two weeks during which we were minus our bag of clothes. In mid-June, as mentioned, we went back to the US for a few days and then had to rush back to Asia. We tried to get on a non-stop flight from New York to Singapore so we could have some time to recuperate on arrival before getting down to business but the Singapore Airlines flight we wanted was fully booked. So instead, we took a gamble. The plan seemed simple on paper: use four separate tickets to travel from New York to Singapore via London Heathrow, Shanghai Pudong and Hong Kong. All the transit times between flights were generous enough and we were even ready for the possibility that a British Airways agent in London might contend that we would need a visa to transit in Shanghai. We xeroxed the pertinent transit rules from the Chinese Foreign Ministry website and carried a paper ticket that indicated that we were booked on a flight to Hong Kong within 48 hours of arriving from London.

Still, we were worried so for the first flight out of New York, we packed our one check-in bag only with clothes. We also decided to wear business attire (suit, tie, leather shoes, dress shirt, cuff links) on board. At the British Airways check-in counter, we presented all four of our tickets, as well as a summary of the itinerary with the respective locator numbers for each leg of the journey. The check-in was fairly simple. The agent tagged the one bag all the way to Singapore but she had to put two tags on the bag because one tag can only accommodate three flight segments. We expressed some concern to her, but she said that this was not unusual and that there should be no problem.

If the bag made all the conections it was supposed to. But we were flying out of New York's JFK on what had been a rainy day. A backlog of flights had piled up and BA182 was more than three hours late departing for London. We arrived at Heathrow more than two hours behind schedule. Globophobe rushed through the Terminal 4 security but got to the gate for the flight to Shanghai just minutes after the flight had closed. The bag of course could never have made the half-hour transit even if Heathrow were operating at optimum efficiency - London's "premier" airport just ain't Changi or Chek Lap Kok. If you're ever on a bus between terminals, check out all the random piles of tagged bags strewn all over the place. Heaven knows how many bags are just lying in luggage limbo at LHR.

After missing the connection to Shanghai, BA made us go through an excruciatingly long queue at the "Flight Connections" counter. We tried approaching "Customer Service" but they provided no customer service. Only the Connections counter could make changes to passenger travel. Once we got to the counter, an agent put us on a flight to Hong Kong; all the flights to Singapore were apparently full. We were actually pleased by this turn of events since we would arrive in Hong Kong in time to catch our original flight to Singapore. The agent told us that since we had three hours before the Hong Kong flight left, it was possible that our bag would be retagged and put on the flight with us. Yeah right, we thought. Fat chance of that. Still, if the bag was put on the next flight to Shanghai the following day, it would arrive in Singapore only a day late.

That was not to be. We got to Hong Kong ahead of schedule. But when we got to the gate from where our Cathay Pacific flight to Singapore was leaving, the agent there refused to let us board. We could not travel without our checked bag, she insisted. The BA agent in London had put us on a later CX flight to Singapore. If our bag made it on the BA flight to HK then it would be on that flight. So we waited and got on the later CX flight. Once in Singapore, however, there was of course no bag. We were late for a dinner engagement so we asked the CX ground staff to handle the lost bag report. We went to our meeting, thinking that the worst thing that could happen would be for our bag to be 24 hours behind.

Wishful thinking. A day passed and there was no bag. Another day, no bag. And no service. CX, the last carrier we flew, was silent on offering compensation or money to buy emergency clothing. Phone calls to "their" baggage service led us to a company called SATS, the CX ground services agent in Singapore. It was not until the day we were to leave Singapore - four days after arrival - that we received an offer of SGD150 to buy clothes and other necessities. This was hardly sufficient. Neither SATS nor CX bothered to call. Instead, we had to call them to check for any update. We could use an online "tracer" service but it gave no indication of where the bag could be. The night we left Singapore for Stockholm via a Qantas flight to London, we went shopping at Changi with the SGD150 and bought a pair of shoes, two shirts, trousers and a coat (necessary for the cold nights in rural Sweden). We ended up spending about USD200 more than the emergency funds.

Once we got to Sweden, we called SATS. Still no bag. The company promised to call us every day with an update. We got no such calls. We were promised an additional SGD100 but as we were in a country with no CX office there was no way we could receive the funds. A week and a half after the bag was lost, just as we were giving up hope, we received an email from a China Eastern baggage service person at Shanghai Pudong. He had apparently found our bag, which had been put on a flight to Shanghai five days after it landed in London. Ryan of China Eastern spotted our email address on our luggage name tag and took the liberty of contacting us. He offered to send the bag to Hong Kong or Singapore. We emailed him back to ask him to send it to Hong Kong, our next destination. We called CX and SATS and they continued to be oblivious, doing nothing to find the bag or to help us out. Cathay kept passing the buck to SATS and SATS could not have cared less about a CX passenger; they are not an airline. Singapore efficiency? Well, not quite.

We should point out here that Globophobe is a Cathay Pacific Marco Polo Club gold card holder - oneworld sapphire, to those who keep track of these things - which means that we flew more than 60,000 miles on CX and other oneworld carriers last year. Did that "elite" status mean we got better service from Cathay? Not at all. Just the run around and promises to call back that were never kept. The only way we got things done such as the payments or SATS staff to call us back was by shouting, lecturing and cajoling the Cathay staff into action. We did more to retrieve our bag then the CX and SATS staff did. They had no idea the bag was in Shanghai, while all the time we were in communication with China Eastern.

When we got to Hong Kong, on the spur of the moment, we decided to fly down to Singapore. We would pick up the errant bag later, we thought. Before boarding the plane, however, we managed to get CX to pony up the additional SGD100. We went shopping at Hong Kong airport and again went beyond the budget by about USD45. We sent a chaser email to Ryan to find out about the bag, but heard nothing. The day after we got to Singapore, he emailed to say that the bag would be on a China Eastern flight to Hong Kong that afternoon. Great - we were to fly back up to Hong Kong the next day and would finally be reunited with our bag two weeks after it had gone astray. Thank you, Ryan of China Eastern! Who says that China's carriers don't provide good service?

That Friday, just as we were about to pack for the flight, we received a call from SATS. We have your bag! Now this was confusing. We thought our bag would be in Hong Kong, but now here it was in Singapore. When we got to Changi, we had SATS deliver the bag up to the Cathay check-in counter. It was indeed our long-lost High Sierra backpack! The double tags from BA in New York were still on it. There was no evidence of China Eastern's involvement. But there it was - in good order and with everything inside (the bag was unlocked).

We repacked at the CX counter so all our new clothes fit into the prodigal bag and a rollerbag which we usually carry on board but which we were using as a check-in bag to carry liquids. At the counter, we saw the agent making calculations, adding up the weights of the two bags. We explained the saga of the lost bag and said that there was no way we would be paying any excess baggage charge. He was sympathetic and rejigged the weights so we could board our CX flight to HK in peace.

So after two weeks of washing our clothes every night, we found what was lost and arrived back in Hong Kong with an expanded traveling wardrobe and a tale of woeful service to tell.

Moral of the story:
1. If you lose your bag, you're practically on your own. Keep pestering the last airline you flew. They are responsible even if they were not the ones that misplaced your bag. Particularly if they rely on ground service agents, service is more than likely to be poor or non-existent. Do not rely on anyone. Keep badgering them.

2. Demand compensation money - emergency funding - immediately. If you have arrived in your home city, the airline may be reluctant to pay up. So if you can provide an alternative home address, then do so. Get as much as you can and ask for more every few days. The airline will have to pony up. (They should also give you an amenities kit to tide you over for at least one night.) Once they promise funds, keep them to that promise and get them to deliver the cash to you as soon as possible.

3. Keep receipts and records of everything you had to purchase due to your lost bag including toiletries and phone calls. Don't go on a spending spree on the assumption that the airline will reimburse you for everything. Be reasonable and you will more than likely be compensated. Some airlines will be more generous than others. When we were stranded in Halifax after 9/11, Singapore Airlines - bless their hearts - paid for a nice hotel room (after we spent two nights in an emergency shelter) and whatever clothes we had to buy. No questions asked.

3. Make sure your name and contact information is on your bag and IN your bag. Include our email address. Tape your business card to an obvious place inside your packed bag so that the card is immediately visible to anybody who should open it.

4. Even after you get your bag, put in for a compensation claim. The airline's liability is limited, but you should claim what you can. If the bag never turns up, then you can also make a separate claim for the loss. Treat the delay and the loss as SEPARATE issues. You should get compensation for both the delay and the loss. Don't forget to claim the cost of the bag, as well as the contents. Note, however, that the airline is not responsible for valuable items unless it is informed that they are in your bag and have agreed in advance to compensate you in case of their loss (not likely).

5. Avoid Heathrow. LHR is now THE transit blackspot of international travel. Stay away! If you are heading to or through Europe, try a more efficient and user-friendly transfer point such as Munich or Helsinki. LHR is not the only problem airport. Apparently Copenhagen's Kastrup has also been flagged by travellers as a troubled port of call. A lot depends on the time of day you are travelling. We went through LHR en route to Sweden at 6 am and it was a breeze. Still, the baggage handling difficulties at Heathrow have created literally a mound of problems for the BAA management. Heathrow had to send a few thousand bags to Milan to have them sorted! Who would have thought that the British would be going to the Milanese to bring order to chaos???????

The Crisis Plus Ten (Part Two): Asia's Leadership Challenge

One of the challenges analysts of Asia have is that the continent is a place where it is often difficult to discern rhetoric from fact, perception from reality. The gap between what is at the surface and what lies beneath, between what is said in public and what is admitted behind closed doors, can be significant.

Take South-East Asia and the region’s integration. On the one hand, ASEAN countries have hailed their efforts to create a free-trade area and to conclude a spaghetti bowl full of bilateral deals in the face of setbacks at the multilateral level. At the same time, ministers tacitly acknowledge that much of the work so far has been focused on lowering tariffs, while certain sensitive sectors have been kept protected. The heavy lifting required to eliminate non-tariff barriers, facilitate trade, and create a real single and seamless market remains to be done. For example, there is no harmonization of rules in the trade of services in the ten ASEAN economies. This deficiency means that global services companies have no ASEAN business strategy; it would not make sense to have one. “What we need is for ASEAN to have a free trade agreement with itself,” advised Steven Okun, Vice-President, Public Affairs, for global package and document distribution company UPS in Singapore, at the World Economic Forum on East Asia which recently took place in the city.

Behind that somewhat jocular statement was a very serious plea for authenticity, for leaders to focus less on grand visions and more on pragmatic policies that would have real impact. “We need less planning and more doing,” said meeting Co-Chair Carlos Ghosn, who is President and Chief Executive Officer of both Japanese automaker Nissan and French car manufacturer Renault. “ASEAN has more of a facility for planning and less of a facility for execution. We may have wonderful plans but execution is 5%.”

ASEAN officials usually bristle at charges, particularly from the business sector, that the organization is all talk and no action. But today, with the pressures of globalization mounting and China and India continuing their market-shaking rise, the chips are down and South-East Asian leaders are speaking more plainly. “The step-by-step way they are handling the integration of ASEAN and East Asia is slow by the reckoning of many of us, too slow by the reckoning of business people,” Singapore Senior Minister Goh Chok Tong conceded. Vowed Ong Keng-Yong, the Secretary-General of ASEAN: “In the coming year or two you will see the leadership focus on implementation.”

In politics, there may be wisdom in discretion and necessity for spin. Yet leaders today cannot coast on vision alone but need to deliver results – and in short order. To be sure, the collective record of Asian leaders over the past two decades has been laudable. Asia has performed extraordinarily well, the 1997-98 financial crisis notwithstanding. According to the World Bank, the number of East Asians living on less than a dollar a day was halved from 300 million to about 150 million between 1990 and 2004, a decline in the incidence of poverty from 29% of the population to just 8%. In Asia as a whole, however, about 20% of the population is still poor.

“We have two faces in Asia,” said Rajat M. Nag, Managing Director-General of the Manila-based Asian Development Bank. “One Asia is growing; the other is falling behind. There are 1.9 billion people in this part of the world who live at US$ 2 a day; some regions are even worse off than sub-Saharan Africa. These two faces must converge rather than diverge as is the case now.”

As Asia progresses and many of its countries become middle-income economies, the shortcomings of the region will stand out more sharply against the backdrop of its fantastic success. Already, a new set of problems has emerged – infrastructure deficits, environmental degradation, energy security, technological development and innovation, and ageing demographics. The most urgent priority will have to be the growing gap between the rich and poor, particularly in countries such as China and India, where the ranks of the middle class have swelled and some have become rich while hundreds of millions remain in poverty. “Differential responses to globalization are leading to income inequality that is becoming a more serious problem in every country, every city and maybe every family around the world,” warned George Yeo Yong-Boon, the Singaporean Minister of Foreign Affairs. “Unless we have global leadership, this problem will become even more acute.”

But therein lies a major challenge. Today, there are no clear lines of global or regional authority. In a world of global threats that require regional and global solutions, there is a lack of regional and global leadership with any clear mandate. In the absence of such an agenda-setting force in Asia, it is up to each country to balance their national interests with their regional and global responsibilities. Authentic leadership means acting to prevent or prepare for crises, not responding to them. It means staying ahead by pursuing reforms constantly, not reacting to competitive pressures or public criticism. It means taking a long view, not governing with the next election or quarterly results in mind.

Indeed, how a government responds to widening disparities in income that are stirring a sense of insecurity, fear and resentment among citizens could be a real test. “Governments may be pressured to roll back reforms and liberalizations and revert to nationalistic rules for foreign investments or protectionist policies for trade,” Singapore Prime Minister Lee Hsien-Loong told participants. “This will not only choke off growth in the region but lead to tensions and souring of relationships.” How countries prepare for the next regional or global crisis will also be an indicator of the quality of their leadership in both the public and private sectors. “A shock will come at some point,” warned Tharman Shanmugaratnam, Singapore’s Minister for Education. “Emerging markets must have shock absorbers. It requires astute management.”

How can East Asian countries ensure that they have the leadership that can provide that astute management? One way is to invest in education that encourages creativity, innovation and a global perspective, attributes that future leaders of the region will need. “The educational system is not responsive enough to the new world that we are facing,” said meeting Co-Chair James T. Riady, CEO, Lippo Group of Companies, Singapore. Minister Yeo stressed the importance of preparing the next generation for globalization. “We can’t just feed them rules and regulations or canned knowledge,” he concluded. “Countries which pay attention to education and value systems will do well. Those which neglect this area are not in the game.”

The Crisis Plus Ten (Part One): Asia's Competitiveness Landscape

When South-East Asian economies were laid low by the financial crisis of 1997-8, their vulnerability to the swift movement of short-term capital and the weakness of their banking and corporate sectors were exposed. Investors fled. Then came a surge of China fever as investors discovered the mainland’s second and third-tier cities and the impressive cost-competitive power of Chinese manufacturing fully flowered. The China machine would produce everything, relegating ASEAN to the role of purveyor of commodities and agricultural products to feed the hungry dragon, said some analysts. China would suck away FDI and South-East Asia’s factories would close, its manufacturing shifting to its giant neighbour. Recently, India’s rise has grabbed the attention of investors and raised questions about East Asia’s competitiveness in the low-cost services sector.

But South-East Asia held its own. ASEAN exports grew along with China’s, though raw material and natural resources demand from China was in no small measure responsible. Vietnam has emerged as a low-cost manufacturing platform with a skilled workforce, an attractive alternative for Japanese investors concerned about their country’s tense relationship with Beijing. According to Nguyen Sinh Hung, First Deputy Prime Minister of Vietnam, speaking at the recent World Economic Forum on East Asia held in Singapore, FDI into his country this year could increase by up to US$ 20 billion, doubling the inflow in 2006. The Philippines, meanwhile, has managed to carve out a niche in electronics, software programming, back-office and call-centre operations. Thailand has continued to be a key automobile assembly hub, while Malaysia’s electronics and semiconductor industries have thrived. Singapore has pushed itself further up the value chain, developing new industries such as biotechnology and strengthening its position as South-East Asia’s premier financial hub. Even in Indonesia, shunned by investors for years after the crisis, FDI has started to rebound. “We have seen companies that left after the crisis come back,” said Muhammad Lufti, Chairman of Indonesia’s Investment Coordinating Board. Indeed, while investment levels in crisis-hit countries may not yet have recovered to pre-1997 levels, not all of the FDI heading to developing Asia is going to China.

The scenario of an overwhelming China juggernaut has not happened. And now, among business strategists, the talk is of a “China Plus One” approach – don’t put all your eggs in one basket, even if it is a Chinese basket. “China Plus One” makes sense for three reasons, said Ko Kheng-Hwa, Managing Director, Singapore Economic Development Board, Singapore. First, there is the logical need to diversify operational risk. SARS, the tsunami, and earthquakes that have hit the region underscore how a sudden crisis could disrupt supply chains. If China’s is knocked out, manufacturers will need reliable alternatives where production can be ramped up quickly. This is especially true in these days of just-in-time production, delivery and inventory management. Second, there is the business optimization motive. Many companies including Chinese enterprises know they have to be global in scale to compete even in their home markets. And third, China and India’s rise is forcing other economies in East Asia and elsewhere to find ways to be more competitive and more attractive to investors. “Everybody is trying to replace red tape with red carpets,” said Koh.

Marketing an economy to investors has become a global game. If an economy cannot beat China on labour costs, then it must try to do so in other ways – the availability of skills, the strength of the intellectual property regime, and a workforce’s capacity for innovation could be key drawing cards. Investors setting up offshore operations do not necessarily flock to the lowest-cost market, said Joseph L. Rice III, Chairman of US direct investment group Clayton, Dubilier & Rice. Reliability and quality are important considerations since these companies keenly want to maintain or even increase the quality of their products, not just make them more cheaply.

There are many other factors for success that countries have to keep on their planning boards. China, for example, has already found that as labour costs go up in parts of the country due in part to the shortage of skilled managers and the growing affluence of the workforce, it must adjust. Affected businesses have moved to hinterland regions. Others have moved up the value chain. Indeed, China has surprised competitors by how quickly it has moved from low-end manufacturing where it dominates to more sophisticated mid-range and even high-end products where it is beginning to have an impact in the market. The Chinese leadership also understands that as energy and environmental costs mount, the country’s industries must become more efficient and innovative.

To be competitive, every economy has to take up the innovation mantra. Singapore, which regularly performs well on global competitiveness rankings, has put the cause at the forefront of government policy. “If we leave out education and skills training, then we will be stuck with the old ways of growing the economy,” explained Goh Chok Tong, Senior Minister of Singapore and Chairman of the Monetary Authority of Singapore. “For the future, you have to create wealth. To create wealth, you have to innovate.” Concluded meeting Co-Chair Carlos Ghosn, President and Chief Executive Officer of both French carmaker Renault and Japanese automobile manufacturer Nissan: “Because of the increasing weight of Asia, the number of industries and sectors where Asia is leading in innovation has got to increase.”

The winners in the globalization age will be those economies and regions that put their competitive advantages package together right and make the right policy choices. The challenge for a region such as ASEAN is that the going is only going to get tougher. South-East Asia will have to make good on its regionalization commitments and go beyond the superficial lowering of tariffs to achieve much deeper integration that truly makes the area a single, seamless market. In this respect, quality leadership and governance – actually implementing ambitious plans – could be the essential ingredient of a globally competitive economy or region. As Goh said, “if you don’t have a government that understands the importance of macroeconomic policies, investment in education, and how to manage socioeconomic divisions in a country, it would be difficult for an economy to thrive.” This plain truth applies as much to the giants of Asia – China and India – as it does to their smaller neighbours who may be scrambling to keep up.

L'état, c'est lui: Will Sarkozy be a Thatcher/Reagan or a Bush/Blair?

The election of Nicolas Sarkozy as the next president of France yesterday had us thinking about the nature of leadership in the globalization age. His arrival on the scene marks a major break from the past for France: the Hungarian immigrant's son is the first French president to be born after the World War II. In addition, Sarkozy has presented himself as a reformer, a tough guy who would not hesitate to make tough choices in pursuit of his strong-held beliefs.

The question is whether he will turn out to be a Thatcher/Reagan or a Blair/Bush. What do we mean by this distinction? Both pairs of British and American leaders presented themselves as people of conviction who governed by principle rather than by polls. They pushed ahead with their ideas regardless of the political setbacks and, at least in the case of Thatcher and Reagan, they were either admired or vilified for their commitment, grit and steely determination. Though his administration ended up creating a huge deficit due to the combination of high defense spending and tax cuts, Republican Ronald Reagan is now beloved - even by many Democrats - for his vision, his simple ways and his communication skills. Even Thatcher's critics would agree that her handbagging style and "the-lady-is-not-for-turning" rhetoric did force structural changes in Britain that were necessary and have turned out to be beneficial in the medium term.

As for Blair and Bush, both have turned out to be less-desirable "mini-me" versions of the two giants of the closing years of the Cold War. Blair came in on a wave of optimism, promising a "third way" - the free market outlook of Thatcher with the compassion and progressiveness of the Labour Party. Bush spoke in a pseudo-folksy manner and promised to rid Washington of the parsing of the Clinton years and instead govern along simple conservative principles. After 9-11, he took that a step further when he adopted a "with-us-or-against-us" stance in his "war on terror" - black and white, no gray.

Unfortunately, Blair and Bush went down the path to Iraq together, ensnaring themselves, their countries and the world in possibly the worst foreign-policy debacle in their respective histories. Their performance, however, has belied the rhetoric. Blair has been less than successful in improving education, healthcare and public services, while Bush has turned the Clinton surpluses into huge deficits. And of course there is Iraq - a devastating triumph of demagoguery and corruption over thoughtfulness and common sense that the world will pay for for many years to come.

So what then of Sarkozy? As former US treasury secretary Larry Summers said last year in Singapore, globalization means that the positives that result from it are magnified, as are the negatives. So when leaders do right, the full impact of benefits is greater than it might have been when the world was not as interconnected as it is today. In other words, good governance can really help. But the opposite is true: screw up and you can really make a mess. Iraq is just such a debacle.

If Sarkozy comes in with ideological blinkers on and pursues reform for reform's sake without the pragmatism and wisdom that comes with experience and perspective, then he could turn out to be a Bush/Blair. But if he takes a pragmatic approach even as he pursues his policies, he could be a great leader. France certainly needs to be shaken up. But you can shake a tree by the roots and kill it.

América latina a China: Usted hace que desea ser una economía mejor

After the Asia-Pacific Economic Cooperation (APEC) forum summits became annual events on the diplomatic calendar more than a decade ago, visits by Latin American leaders to Asia and Asian leaders to Latin America became more frequent. Yet whenever a Latin president turned up in Beijing or an Asian prime minister headed to São Paulo, the getting together of distant amigos seemed more quaint happenstance than a meeting of valued trading partners with strategic mutual interests।

By 2004, when Chinese President Hu Jintao spent two weeks touring Argentina, Brazil and Chile before passing through Cuba, that had changed. Both sides hailed Hu’s trip as a milestone in three decades of Chinese relations with South America. The reason: trade and investment between China and the region had been climbing sharply in recent years – and many South American countries were reaping the benefits of China’s soaring demand for commodities, still the backbone sector of the continent’s economies. In 2006, trade between China and Latin America rose to US$ 70.2 billion, up from about US$ 10 billion in 2000.

At the World Economic Forum on Latin America 2007 in Santiago in April, it was therefore highly appropriate that a number of sessions focused on China and the impact of its zooming growth and widening geopolitical role on Latin America. Participants from both sides of the Pacific stressed that the relationship was no flash in the pan of commodities but rather a match of complements with coinciding interests and a long, mutually beneficial future. “The trade and investment relationship between Latin America and China is a long-term strategic partnership,” said meeting Co-Chair Zhang Shoulian, President of China Minmetals Non-ferrous Metals.

But for a real partnership to evolve, China and Latin America will have to develop a more textured relationship, certainly one based on more substance than raw materials trade. Many in Latin America still do not know or understand the China phenomenon. Inasmuch as there is widespread skepticism about globalization among Latin Americans so is there wariness – even fear – of a rising China. Believers such as meeting Co-Chair Andrónico Luksic Craig, Vice-Chairman, Banco de Chile, took the opportunity to rally the doubters. “Let's dare, take risks, step out,” Luksic urged participants. “We need to understand and shake hands with our friends in China. We need to learn and know China.”

At one level, Luksic was exhorting Latin American business to seek out higher-value trade and investment opportunities in China. This dovetailed with the Chilean Finance Minister’s call for a transformation of Latin America’s economies so they are not captive of the boom-bust price cycles of raw materials. When the commodities party should end, Latin America has to be prepared. Countries must not only exploit the opportunities that China offers but must also prepare themselves to exploit their comparative advantages to compete in the global market against China, India and other emerging economies. This is particularly true for nations in Latin America that are not resource rich and may not be benefiting directly from China’s hunger for raw materials to fuel its 11% annual growth.

For countries to boost their competitiveness and come up with the products and services that China and the rest of fast-growing Asia need and will buy, Latin American economies must pursue the key prescriptions of the Santiago Consensus and invest more in education, innovation and infrastructure. Some in Latin America have pointed out that during Hu’s visit in 2004, China had promised to invest in a number of infrastructure projects. While China has been busily financing and building infrastructure across Africa, it has not been as active or munificent in Latin America. The region should not sit and wait for the bounty to come its way, but must move quickly to address its competitive shortcomings such as the lack of infrastructure, countered Javier Santiso, Deputy Director, Chief Development Economist, OECD. “China and Latin America are two faces of the same coin,” Santiso reckoned. “China represents an opportunity. It is a wake up call for Latin America to pursue reforms.”

That is a key proposition of globalization. Globally competitive countries should motivate or even force both partners and rivals to improve themselves and become more productive and efficient. China’s current advantage is its ability to produce quality products at a reasonable price, but its own economic transformation is slowly turning this giant Asian economy into a formidable force in higher-value sectors such as IT services and biotechnology that require innovation, world-class infrastructure and the rule of law to flourish. Latin America must follow suit. Like many Chinese companies that are going global after a period of reform or as a way to force themselves to become more competitive and hence better able to compete at home, Latin American enterprises have to reinvent themselves too. Concluded meeting Co-Chair José C. Grubisich, CEO, Braskem Brazil: “Global companies are looking to India and China which gives our local companies the opportunity to restructure and to prepare a strong platform to move into the international market in a better shape.” That is precisely how the rise of China is driving a powerful positive agenda for Latin America.

A Modest Proposal for Aviation Security: Roll Up Sleeping Passengers in Saran Wrap

Globophobe has just taken a quick trip between New York and Washington, DC. We purchased a combined air ticket and two-night hotel package through Travelocity using a Hong Kong credit card and then departed the next day. On arrival at New York’s LaGuardia airport, we checked in at a counter and received our boarding pass. Immediately, we noticed the dreaded mark of suspicion – the “SSSS” – on our pass indicating that the airline had selected us for “secondary inspection” which entails a pat down and additional screening of carry-on bags and other items such as coats, wallets and shoes.

How do you get chosen for this special treatment? The agent at the check-in desk ventured that it was because we had bought our ticket the day before. True, but we did so through Travelocity using an account we have had with that service for years. We used a legitimate credit card and put in our airline frequent flyer number during the purchase. We did not buy a one-way flight.

So we went through the security checkpoint, putting everything that was in our pockets into our carry-on bag, including our wallet. We also took off our shoes and sent them through the x-ray machine along with our trusty laptop. No alarms. “Secondary screening, no alarm!” shouted the security officer. We were then picked off the line and taken for the pat down by a male agent. Does the fact that no alarm went off make a difference? The inspector said that if the passenger doesn’t set off an alarm then the frisking is less intrusive. What a relief – this guy would be feeling us up with a light touch!

Now, having passed the security check without problem on the way down to DC, we were confident that we wouldn’t be selected again on the return. That was wishful thinking. At Reagan National, our boarding pass again had the SSSS. This time, there was no distinction between somebody who sets off the alarm and one who does not. The pat down was quite thorough – and frankly, humiliating. At one point, the humorless agent felt our hip bones and asked what that was. “Me!” Globophobe replied with a slight sneer. We have learned to hold our sarcastic tongue when under Transportation Security Administration inspection. Upset just one touchy martinet and you could be whisked to Guantanamo! (Okay, that’s an exaggeration but our point is that the climate of intimidation and fear in the US is certainly a lot more intense since 9-11.)

So what does this experience tell us about airline security in the US? The screening procedure is certainly imperfect. The “random” selection seems to be based on the wrong criteria. On a flight from New York to Washington, why single out people who bought their tickets the day before flying? That might make sense for a long-haul route. Should somebody who has bought tickets online for years with the same credit card, leaving a paper trail a mile long, need to be frisked? Should we bother to screen somebody returning home who passed secondary inspection on his outbound flight?

We should abandon the “random” and instead do what the Israelis do and use our intelligence and simple logic to pick out the people who are more likely to be a potential danger. Now, you might ask, is Globophobe for racial profiling? Well, to be honest, if that’s what it takes, then so be it. How many white grannies are suicide bombers? Should we have special screening for Muslims? I would say not but an Islamic name – like it or not – has to raise at least the need for a critical assessment of the person’s appearance and demeanor, as well as other details such as how the passenger purchased his ticket, where he is going, where he has been, and where he lives.

But here’s Globophobe's politically correct solution (formulated with the help of one of our colleagues in Singapore): Get rid of all the seats on planes and instead have shelves with niches. At check-in, passengers would give up all luggage which would be placed in secure boxes and then loaded in the hold. Passengers would then lie on a table and be given a tranquilizer, putting them instantly to sleep. Then each passenger would be rolled up in saran wrap like mummies and conveyed by special multi-layered gurneys on to planes and slotted into the niches. During the flight, attendants would ensure that passengers remain unconscious. On arrival, each person is revived, unwrapped and allowed to retrieve their bags.

Sound fanciful? Think about the benefits. Everybody would get at least a good nap. Long-haul flyers would be well rested on arrival. And after the initial cost of reconfiguring airports and airplanes to accommodate this new way of flying, the cost of air travel would be very low – no meals, no drinks, no class segregation (although some passengers may opt for more expensive bubble wrap for extra comfort), no fuss. Just loads of saran-wrapped sleeping passengers who would be no threat to anybody. We would need fewer flights because all planes would be able to carry many more bodies than they do now. And we would all be safe, secure and able to sleep at night.

Happy (Chinese) New Year!

To all our readers, especially our friends in China and Hong Kong:

新年快乐! 过年好! 恭喜发财!

Happy Lunar New Year! Happy Year of the Pig!

From all of us at Globophobe (who by the way is a dragon)

Davos De Profundis

It didn't take long before another idle thought came to us.

We know you were wondering what the most profound thing we heard during the Davos meeting was. Well, let us tell you. At a dinner session on China's demographics, a Swedish researcher who has studied the issue said that the current generation of elderly Chinese will be "heroic" and will lay down their lives for the younger generation, accepting that their meager pensions won't sustain them and that the healthcare they will receive as they decline will be limited and of poor quality. The Swedish gentleman predicted that there would be an epidemic of suicide among the elderly in China.

Quite a sobering forecast...

Davos Debrief

Globophobe has been sitting in the cafe-bar of a hotel
on the Davos Promenade, sipping a heisse schoggi
and musing about this year's World Economic Forum
Annual Meeting. Now lest you think that Globophobe
has gone glam and is making like the idle rich, please
know that we're here only because we have no
Internet service in our humble digs (once the meeting ends,
an Internet connection is notoriously difficult to get in this town)
and this 60s-70s-vintage lounge (complete with the muzak
of such favorites as "Cuando, Cuando, Cuando" and the
rock-and-roll theme from the Peanuts TV specials) offers
reliable wi-fi service. It's not free, but you aren't compelled
to buy a drink to occupy a chair. It is nearly 6 pm, Davos time,
and Globophobe has been sitting in the same seat working
since 10.30 am!

But enough of our travails. What did we think of this year's
globo-jamboree which ended on Sunday? I suppose that
without the flashy celebrities of the order of 'Brangelina',
there may have been fewer moments of spectacle or
electricity (ie no Sharon Stone spontaneously pledging
USD10K for mosquito nets). What we found most interesting
was a noticeable shift to discussing not just the impoverished
in Africa but also the erosion of the middle class and the plight
of regular workers, those who might actually be hurting from
globalization and not just those who are losing out because
they are so poor and remote that they are untouched by globalization.

Also, we sensed that the international community is perplexed
by what Klaus Schwab, the founder and executive chairman of
the Forum, calls the world's "schizophrenia" - favorable global
economic conditions coupled with underlying instability and
dysfunctionality, particularly on the geopolitical front. How can
things be so bad when we feel so good? To the investment
banker who might ask that question, we say: why not holiday
in Darfur? Or perhaps a few days in Baghdad will put things in
perspective? (On second thought: maybe a trip to Washington,
DC, will do the trick.)

There was also a lot of stuff on Web 2.0, avatars, etc. which
seemed as remote as the wi-fi discussions of five or six years
ago, but probably will be old hat and in common use five or
six years from now. (We tried out Second Life but can't say
we were bowled over. One of our friends contends that
avatar play is for, in his words, "lame-ass losers with no life,"
the LALs, apparently a well recognized consumer segment
with consistently high spending on online shopping.)

We posted some commentary on Davos during the meeting
and hope you will read those entries. If more idle thoughts come
to mind as we sit "un-idle", we may just post more comments.

Tomorrow, we descend the mountain.

America's Power Equation

At the closing plenary session of the World Economic Forum's Annual Meeting 2007 in Davos, US Senator (and probable candidate for president) John McCain offered an American perspective on the current global geopolitical situation. He was reacting to critics who refer to "failed American leadership," he said. Americans are sometimes frustrated when North Korea continues to build nuclear weapons, when China fails to act responsibly even when in its own interest, when little action is taken by the international community to put the brakes on Iran's nuclear programme, when UN 'blue helmets' stand idle as defenseless people are ethnically cleansed, when Russia and China vote against a Security Council resolution to highlight Myanmar's continued detention of political dissidents including Aung San Suu Kyi. "Perhaps maybe some of this we have to do alone," said McCain. "We don't do that very often. We understand the importance of multilateral action and there is nothing we wouldn't like better than to join together to stop another genocide. America's first choice will always be to have an alliance of existing like-minded institutions."

The makings of a foreign-policy doctrine for a McCain presidency? Maybe so. But can we wait two years? Read Maureen Dowd's column today (28 January 2007) and perhaps you might agree that two years of the current Bush-Cheney approach may not be such a good thing. We would bet that many of America's allies and friends, particularly in the Middle East, are wondering - in the privacy of their own minds - what more might go wrong before the new president takes office in Washington in January 2009. (Could they be pining for a return of Bill Clinton to the White House on the arms of the new commander-in-chief?)

All this illustrates how important good governance is. We were reminded of a talk Larry Summers gave in Singapore a few months ago at the Raffles Forum, a meeting organized by the Lee Kuan Yew School of Public Policy at the National University of Singapore. Globalization, Summers said, has meant that "the leverage that comes from successful governance is greater today than it has ever been. Prosperity can be created more rapidly than ever before." Successful governance can really help, bad governance can really cause a mess. At the global level, he added, the stakes are high. "Leadership by a large nation, great power, even a hegemony, depends crucially on competence and a perception of competence - and so these questions of global governance loom larger than they have ever before." Summers, one of Bill Clinton's treasury secretaries, smiled wryly as he spoke those words.

(At Davos, it seemed at times that everybody was calling into question the competence of the current occupant of the White House. David Gergen, a former adviser to several presidents, bemoaned the lack of diplomatic efforts to resolve differences between the US and Iran. "Any halfway competent administration," he said, would pursue diplomacy before even floating the idea of military action. He recalled travelling to Syria with President Nixon to talk to Syrian strongman Assad. Competence...Will Americans vote for it in 2008? More to the point, in this age of spin-of-the-day and image-building, can Americans pick the competent leader they need from the inept featherweight who should never be allowed into the Oval Office?)

So Much Unfairness of Things

In the session "A Business Manifesto for Globalization" at the World Economic Forum's Annual Meeting in Davos, economist Joseph Stiglitz said that as a result of globalization "countries as a whole have gained more than they have lost but that doesn't mean that individuals as a whole are better off." Renault and Nissan chief Carlos Ghosn remarked: "Most people who are hurt or think they are hurt by globalization know it; most people who benefit do not know it."

So who are the winners and losers in this age of rapid and merciless globalization? There are the impoverished of course, but many of the poor particularly in Africa are losing out because they remain untouched by globalization and have not yet benefited from the advantages that it can bring. What about those people whose lives have been humming along nicely but are now finding themselves outsourced or outfought in the competition for jobs or customers? One panelist yesterday said that more people are appreciating the unfairness of globalization because it is hitting skilled workers in the knowledge-based and service industries - middle-class folks in uncompetitive sectors or without niche skills that keep their jobs secure. These are the persons whom globalization is bringing down or at least tripping up. They see the rich get richer, while they stay still or even fall back.

On the first day of the meeting, Arianna Huffington spoke at the US update session of how middle-class Americans are using credit card debt to buy basic necessities. From our own experience in journalism over the years, we know of many professionals our age (40s) and older who have been "globalized" out of their jobs and have struggled to find new employment, full employment or new careers. Many knowledge workers who thought that their education and skill sets had set them up for life have suddenly found themselves sliding off the globalization wave. We're guessing that the erosion of the middle class is so shocking in many countries where upward mobility has become the norm if not part of the culture. If whole groups of people fall back and have to moderate their expectations, that will only create more divides in this divided world.

So it was quite refreshing to hear Larry Summers, the former Harvard President and ex-US treasury secretary, speak about the unfairness of things and the elitism - intended or unintended - that even the most enlightened may be party to. When a participant at the session on freedom suggested that the "spirit of Davos" might be the basis for a framework of global governance, Summers said: "There is a great and profound concern about the cosmopolitization of elites. There is a deep concern that this networking of the elite is not something that is fundamentally directed at the interests of regular working people - people who work hard and play by the rules."

Globalization is now a personal matter. Many ordinary, earnest people who expected to live comfortable lives in clean, well-lighted places have found that even if they play by the rules and work hard, they might not get on; they may even go backwards. Life is no longer so simple.

Too Little Fear?

On the front page of today's (25 Jan. 2007) Wall Street Journal, Marcus Walker writes from Davos that "this year, many of the business and political leaders who gather ever year at the World Economic Forum [Annual Meeting] are questioning whether globalization is good for the ordinary wage-earning people they employ - or in many cases, no longer employ - at their companies." Adds Walker: "A new refrain is emerging in Davos this year: Globalization isn't working for everyone."

Nonsense! That globalization doesn't help everybody is certainly nothing new to the Davos community. The global fellowship or elite, if you prefer, who gather here every January would be remote (and dense) indeed if only now - seven years after anti-globalization activists disrupted the World Trade Organization ministerial conference in Seattle - they grasped that globalization is not fair. Everybody knows there are winners and losers. The real issue is whether there has been, to paraphrase Larry Summers at last year's Annual Meeting, "too much hope and too little fear" about globalization.

It may be that 2007 is the year that fear overtook hope in Davos. That may not necessarily be a good thing. But more prominent voices are articulating what we (the working stiffs) all know to be true – that globalization has a dark side.

With this in mind, my vote for star panellist at yesterday's sessions goes to US pundit and blogger Arianna Huffington. In the US update session, she spoke of the economic hardships confronting middle-class Americans. The pressures are so hard that many are using credit cards to pay for the basics of living. Yet the US is such a consumptive society, that Americans don't have enough space in their homes to keep all their stuff. Self-storage is apparently one of the fastest growing businesses in the US. (Globophobe can believe it, being ourselves frequent users of self-storage facilities in three countries.)

People are looking for moral leadership, Huffington said. "There is a longing for a fundamentally moral discussion about poverty and injustice." People are sick and tired of spin; what they want is authenticity from their leaders. That is a plea that should go to all participants. There is a Davos spirit, but no single Davos view. The idea that suddenly the Davos Man has discovered that globalization can burn is ridiculous. A more pertinent question in this non-flat world is whether what we hear here in the Magic Mountain is authentic, the views not just from those inhabiting the peaks that globalization has pushed up but from those driven into the valleys of despair that globalization has also created.

What is Globophobe?

Nobody has yet asked us this question but we'll answer it anyway. No, it's not a fear of spheres. We are talking about the fear of globalization and its impact. The globalization wave we are experiencing today is so intense and the pressures so heavy that the effects are felt not just at the macro level but also at the micro level - by small and medium-sized companies, by entrepreneurs, by cities, towns, and villages, and by households and individuals. Whether you are a big fish or a small fry, you have to deal with the sometimes jarring effects of the greater interconnectedness of regions and economies and the swifter flow of information, data and capital. The forces of globalization are relentless; they can offer great advantages and they can tear you down without prejudice.

In Asia, the turbulence is particularly strong because in many we ways we are at globalization ground zero. The emergence of China and India, as well as other large emerging markets such as Brazil and Russia, is driving many of the structural changes happening in the world today, in particular, the rise in competition on the cost and quality of both goods and services - and not just at the low end. China and India are both threat and opportunity to everybody from their immediate Asian neighbors to small commodities producers in faraway Africa.

Whether you are a wheat farmer in Kansas or a street sweeper in Bamako, you are not immune to the pressures of globalization or the impact of the rise of China and India. And it is not so much that the world is getting flat; on the contrary, it is getting more uneven and inequitable. Globalization is creating peaks of excellence, where an economy, company, group or individual masters a particular niche, that connect somewhow or interact with other peaks of excellence, leaving the valleys to the laggards, the uneducated, the impoverished, the uncompetitive, the recalcitrant, the elderly, those untouched by modern communications, the uninsured, the illegal, the discriminated, the sick, the infected, the refugee, and others who are not somehow able to avail of the advantages of globalization. We should all work to somehow help those in the valleys move up to the peaks or at least higher up the competitiveness slope.

We feel that there is altogether too much optimism about globalization and not enough healthy skepticism. Everybody - from your elderly aunt to the newest infant born today - will have to learn about what is going on, about the impact of the rise of China and India, about the consequences of shifting competitive advantages. It may be trite to say, but it really boils down to education. And that is what Globophobe hopes to do - to educate ourselves and others by observing our world, particularly Asia, and writing about what works and what doesn't. We have no answers. Like everybody else, we have a lot to learn.

Teach America's History in the Philippines

When Globophobe was much younger, we spent ten years studying in the United States - from seventh grade through to university. We had grown up in the Philippines so it was not unusual for us to go to America to study. At the schools we attended in Massachusetts, we took two full years of American history, first in the seventh grade and again in the eleventh. Both times, we were surprised that the courses and the textbooks devoted little time to the American colonial experience in the Philippines. Our teachers were generally unaware that Filipinos who had launched a revolution for their Independence from Spain shifted their efforts to battle the American occupiers for about three years from 1898 when the Spanish-American War ended. Some 12,000 US soldiers were sent to the Philippines to subdue the local militias and insurgents who were waging what is known as the the Philippine Insurrection against the United States. Even though the war wound down by the end of 1901, limited conflicts on some islands continued until 1913.

Except for the three-plus years of the Japanese Occupation of the Philippines, the United States armed forces remained in the country until 1992, when Washington closed its major air and naval bases after the Philippine Senate rejected the treaty extending the American lease of its facilities and negotiations between the two governments broke down. The US military presence in the Philippines for nearly a century was an important factor in maintaining the stability of the country through the Commonwealth period before World War II and after Independence in 1946. The US bases were also crucial in ensuring regional security, notably during the Korean and Vietnam Wars. It could be argued that the Philippine Senate's 1992 vote against the bases treaty marked the maturing of the Filipino nation. While Filipino governments have been rocked by coup attempts since then, Filipinos have sought to resolve their problems themselves, without the American military hovering.

If American schoolchildren in the past including George W. Bush at his exclusive New England boarding school had been taught about the US experience in the Philippines, particularly about the Filipino insurgency and how long it took to build the Philippine nation and a working, independent government which even today is still hardly a paragon of stability and good governance, perhaps the debacle in Iraq might have been avoided - or at least the potential for chaos post-Saddam better understood and anticipated. Consider Brent Scowcroft's essay in today's New York Times. Once the US got into Iraq, it landed itself into a messy situation that makes the Philippines seem like Singapore. There is no easy way out. And as in the Philippines, the US may be in for a century of military engagement in Iraq, particularly if it wants to keep the Middle East from blowing up. As John Kerry was trying to say when he botched that election campaign joke, those who haven't learned their history at school get stuck in a quagmire like Iraq.

Bullying the Philippines: For Want of a Nail, the Kingdom was Lost

Philippine President Gloria Macapagal Arroyo's decision to remove convicted rapist Daniel Smith, a 21-year-old US Marine, from the Makati City jail and place him back in American custody was inevitable. Unpopular as the move was bound to be, Arroyo had no choice. The Americans bullied her into taking "executive" action and overriding the judiciary, which had ordered Smith held in the local prison and not in the more comfortable confines of the US Embassy. Washington had cancelled the annual "Balikatan" joint military exercises to show its disapproval of Smith's incarceration. Once Arroyo had returned Smith, who is appealing his conviction and sentencing to 40 years imprisonment, the Americans said the exercises were back on, but did not set a date for them to begin.

The message the Americans are sending is that the comfort of a single convicted American is worth more than the security of the Philippines and the surrounding region. An exaggeration? Maybe so, but tell that to the many Filipinos who are rightly outraged by Arroyo's action. Washington was willing to put on hold useful military cooperation between the US and Philippine armed forces just because one stupid American kid, who was convicted for raping a young Filipino woman and sentenced to 40 years in prison, had been sent to a local jail. We have to conclude that the US is willing to compromise Philippine and regional security just so that Mr Smith can have a private bath and shower, a decent bed and better food for the weeks or months that his appeal may take to be heard. So much for the global war on terror! Smith should be thankful he wasn't in the US-run stockade at Guantanamo Bay!

The US says that it is a matter of adhering to the Visiting Forces Agreement between the US and the Philippines. Smith's legal case is still alive so until his appeals are heard, he must remain in American custody, Washington argues. But what's right or wrong, legal or illegal, doesn't matter. The US has gotten its way, Smith can have his comforts, and now protesters are calling Arroyo a traitor. Yet again, for want of a horseshoe nail, the kingdom was lost. The US sure knows how to win friends across the world. Even in the countries whose citizens are mostly supportive of America, the US will find a way to turn people against them. The ghastly hanging of Saddam Hussein was yet another reminder of how inept the US is at winning the hearts and minds of those who would normally be pro-American. Will they ever learn?

Merry Christmas and a Happy New Year!

To Our Readers:

Whoever you are and wherever you are - God knows, there aren't many of you! - Merry Christmas and a Happy New Year to you and your families!

Why don't you stay a while - and leave us a comment?...

A special greeting to our dedicated readers logging in from Ketchum, Idaho: enjoy the skiing and travel safely!

G.

Globalization (I): India the Isotope

Reading Kishore Mahbubani's recent essay on Yale Global regarding India's emergence as a global power, we were reminded of an idea we and a colleague of ours in Singapore have been discussing for some time. A couple of years ago, we had been musing about how developed India has many things that the developed West has - high-rise buildings, luxury hotels, industries such as automaking and steel production, a sophisticated business culture, financial markets, and so on. While these exist, they were built by Indians for Indians according to Indian tastes and style, created at a time when import substitution was the way to go. Rather than bring in what you needed from the West, you made your own.

Today, visitors to India are struck by how "Indian" things are. Now, that may sound naive, maybe even stupid. But hear us out. What we mean is that the buildings, the airports, the hotels, the vehicles, the physical stuff we see and use, they are all familiar to those of us from other parts of Asia but yet are distinctly Indian. The cars on the road are probably the best example. India developed its own auto industry and produces automobiles that are unmistakably Indian. The Ambassador taxis are as much an iconic presence on the streets of Delhi and other Indian cities as the black "hackney carriage" cabs are in London. The distinctiveness may be discerned in service practices, customs and procedures too. Indian English, both written and spoken, has its own special characteristics. The quirky half hour added on top of the five-hour time difference from Greenwich Mean Time says it all: Indians may tell time like the rest of the world but they set their own pace and standards.

Fair enough. So consider India's development path something of an isotopic phenomenon. The part of India that modernized - mainly its cities and industrial areas - did so in an Indian way. Imitation wasn't really a motive. In those days, the notion of global competition and producing world-class products, ie the pressures of globalization, were not paramount. The aim was development - to meet the needs of citizens.

Times have changed. As India has opened up, the world has creeped in and Indians have been looking out. There are now foreign marques from Japan, Korea and Europe among the Tatas and Marutis on the road. The question is whether India the Isotope is converging with the rest of the world - or will India globalize in its own distinctive way? To us, the latter seems the most plausible. Already, India has turned conventional Asian development wisdom on its head. Its service economy has led the way in growth and it has achieved international success in such sectors as IT and pharmaceuticals. Meanwhile, agriculture has faltered and manufacturing has not grown as fast.

India is still beating its own path. And given the extreme poverty that continues to plague the country, it must produce its own globalization format - what we might call Globalization (I). It's a development model that is both outward-looking and inward-focused. It is about keeping India on a high-growth track equal to those of the most open dynamic markets in Asia, while aiming for inclusiveness. India will develop innovative products and services but at a low cost that would make them available and accessible to its people and those of other emerging markets. That's the global niche India is claiming for itself.

While China is trying to become the United States and Japan and has an embarrassment of riches in foreign direct investment and foreign exchange reserves, India doesn't have the money to throw at its ambitions. In this, it seems more like Brazil or South Africa. Will Indian cars start looking like American, European and Japanese models? Maybe so, but we reckon they will still retain a clearly Indian style. Will Delhi begin to look like Bangkok or Detroit? Again, perhaps some of the city will, but more than likely Delhi won't get scrubbed clean and bland like Singapore.

Isotopes are typically the less stable form of an element. It may be, however, that the Indian way of globalizing will slowly but surely result in a stable, equitable and self-confident society that projects and protects what Indians want to preserve of their unique culture yet remains as open to the world as any.