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Futurism Is Workless: Calling G20 2020

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Credit: Diego Rivera

Today, increasingly all our work of sorts, repeated laborious and mundane, now openly snatched across the world by robotic revolutions, supported by AI+AR+VR and block-chained programs. This is not a bad thing. This is a global uplift for our imagination creating extra thinking time. Humankind finally on way liberated from boredom of mundane and slavery of grind. Maybe we will produce entire new generations of deep thinkers to live in global harmony, diversity and tolerance, where gender fluid, smiley robots allowed hating each other and backstabbing considered sports.  

Not to destroy our real spiritual values of our miraculous creation; humans originally designed to invent advancements, as if designing a wheel, while our minds, designed to think of wisdom, as if discovering gravity, we cannot ignore the most valuable miracle of our known universe, a mind given to all us as a free gift. Obviously, our relentless pursuits of last decades failed; Tik-Tok damaged and Social Media controlled global populace awaits for new wisdom

History is not just a series of rigid facts but also rather a mirror of our fluid understanding of our own present; the future is not some abstract dream but rather built out of our own carvings from the past. Whatever we did during our last few decades laying out the foundations of our present castles, we now enter, haunted as they are, but this is where we reside. Trick or Treat, candy or no candy, we have to chase the shadows with our trepidations.  

Futurism is workless, but indeed, such revolutionary transitions can only be measured as juggling monstrous calamities but blindfolded or playing with ‘time-machines’ without driving licensees. Equally, not easy is the erasing of the status symbols when century old habits of paper pushing offered security or out of box thinking only created butterflies in the stomach. The decades of enforced cubicalized-culture has hurt our mental productivity, stolen emotional contributions of innovative excellence. Such affairs demand special skills with stamina, wisdom to debate and courage to table action plans with transparency or surrender to defeat.

Acquisition of such skills of nouveau entrepreneurialism, not to be confused with common curriculum in need of elimination at universities of the world offering half-baked notions of entrepreneurial leadership as academic certification.  As a proof, to save themselves from the absence of contents and suffocation of illusionary mastery, they must hang in their hallways the portraits of the last 10,000 earth shattering entrepreneurs who unbounded from the Ivy, dropped out from moist edifices and changed the course of history. Research this deeply as denials will fail.

Today, we kneel in the middle of economic purgatory and pandemic hell…

Today, nation-by-nation, the intelligentsia of the recent past, fermented and marinated in their selective influences, now hiding in panic rooms in need of oxygen. The way out is not to face the pitchforks of restless citizenry but rather new understanding with a new definition of a workless future and how to open honest debates on how such advancement will unfold.

The harshness of the message, written on the wall, speaks volume. Some 200 nations are in the races to survive. Some 10,000 cities are busy figuring out their future. The futurism demands new thinking and new deployments. The pandemic recovery is 100 moons long. The restless citizenry, workless seeking directions, a billion replaced by advanced technologies, a billion displaced by remote working, a billion misplaced as out of box entrepreneurs…time to face the music.

The forbidden hot-topics and major crossroads ahead…

Digital divide is Mental Divide; Mental-divide is number one blockade of digital-divide; such digital transitions feared for fast speed of performance to expose incompetency of workers. Furthermore, creating redundancy and fearing for creating accuracy of work exposing checks and balances to display hidden mismanagement, as such slowing down overall speed and performance and destroying economies. Despite worldwide access to almost no-cost technologies since the past decade, the majority of nations still buried under heaps of paper to avoid exposing proper columns indicating correct balances and totals. Only digitized nations will thrive in a digitized world.  National leaderships across the world must issue decree not to fire during transition for incompetency but rather guarantee them upskilling and reskilling options.

Micro-Power-Nations and Super-Power-Nations: As Super-Power-Nations lost their powers to fix the entire world, but now Micro-Power-Nations will try. Super power economies more aligned to attacking or destroying other economies as a prime necessity for their own survival. While new emerging Micro-Power-Nations are upcoming hungry performers with very special skills and are willing and able to help any small or super power without threatening their base of power. These 100 plus, Micro-Power-Nations may deploy highly selective, well-trained and extraordinary strengths and deliver surgical solutions to any mammoth nation and mutually rewarded. Such specialized capabilities will create universal borderless residencies, merit-based immigration, global friendly fair-trading, and unlimited human resources platforms for the new global age world. This is not about armies invading, here armies of entrepreneurs landing in collaborative synthesizing to create massive local prosperity. Such advancement will affect thousands of cities and nations and will towards faster advancements. Technology silently creates some 100 plus mighty micro power nations that with upskilling play a key role.

The Population-Rich vs. Knowledge-Rich Nations:  Pandemic recovery demands economic intellectualism to embrace futurism as global shifts from ‘knowledge-rich-nations’ to ‘population-rich-nations’ changing economic behavior across the world. Decades ago, large populations in any country considered an economic curse; sheer burden of visible poverty, scenes of survival and struggle of feeding millions of hungry mouths provided the blatant proof. Today considered a blessing; when citizens armed with mobile online transactional centers, digital humming and trading with billions of devices with trade activity are now new proofs of economic vibrancy for such overly populated nations.

Over centuries, the supremacy of knowledge housed in the West, Knowledge Rich Nations, primarily the developed economies now harshly tested as such outdated wealth of knowledge as if water gushing down from broken dams flooding faraway lands across the world. Knowledge-rich nations must rapidly re-learn how to compete and survive against highly agile and low-cost brilliance creating shine within some 100 emerging population-rich nations. The monopoly of knowledge has been shattered. Population-Rich-Nations must become platform economies; thrive on national mobilization of entrepreneurialism platforms of upskilling 

Referenced from “15 Monster Trends– by Naseem Javed” Dec 2014

National Mobilization of Entrepreneurialism:  Struggling economies of the world are visibly showing the lack of upskilling of exporters and reskilling of manufacturers across their national small and midsize vertical business sectors.  Key Questions: Are there 1,000, 10,000 or 100,000 high potential small medium business enterprises within a region or a nation? Are they doing USD $1-20 million in annual turnover and ready to further quadruple growth via exports? Is there a national agenda on upskilling, reskilling for fast track transformation to recovery and job creation? Are Associations and Chambers of Commerce receptive to such goals on creating excellence and exportability?

Key Realities: Unlimited, global markets can absorb unlimited innovative ideas, goods and services. Unlimited, SME Founders with entrepreneurial talent and energy are always anxious for global age expansion. Unlimited, well-designed, innovative ideas and global age skills can quadruple enterprise performance. Missing Links, lack of upskilling, reskilling and global-age thinking and execution styles are all strangling growth. Key Agenda for Discussions: How digitization of national entrepreneurialism on upskilling platforms saves economies and creates growth?  How simultaneous synchronization of upskilling of 100,000 SMEs and MFGs results in exports within a nation?  How is the Pentiana Project placing 25,000 SME MFG on digital platforms of upskilling and soon add another 100,000 SMEs?  How Chambers & Associations will take lead, creating a marathon on exportability, and inviting a national dialogue?

Understanding the Last Seven Societies: How 100 years of evolution has landed us here; during the Print Society in 1900, when the printed word was power, literacy was perquisite and only the privileged had access to knowledge. Why similar scenario 120 years later occurring today, futurism demands futuristic literacy.

“The Radio Society made its impact after a quarter century. It brought information freely available to the air and music to tap dance on assembly line floors. The ‘voice’ created radio-personalities with opinions and opinion leadership became noticeable. There were 5 other major societies.  TV Society brought live action dramas, and started the colorful consumerism. Telecom Society shorthanded distance and created standardization. The Computer Society created miniaturization and a sense of accuracy. The Cyber Society brought the world to the desk and started the diffusion between work and other lifestyles. We just left the Click Society, which brought the world into our pockets and seriously disrupted the traditional work model. “

Excerpted Source: Naseem Javed, Sunrise, Day One, Year 2000.

Expothon is also planning a “Special Senior Level Regular 3-Hour-Webinar-Workshop-Series” in 2021 to create detailed and pragmatic discussions with powerful and specific debates with pragmatic and immediately implementable solutions. The “National Mobilization of SME via Upskilling on Exports” calibrated for the selected 100 Chambers and 100 Special Trade Associations across the world along with gatekeepers of trade and commerce of selected countries.

Recommendations:

The Micro-Exports: With some 500 million SME in the world, a billion new big and small, young and old entrepreneurs on the march, G20 2020 Riyadh, Saudi Arabia had some great opportunities to table tactical combative blueprints to advance the challenges of local grassroots prosperity. As a smarter way to save economies, the emergence of such “Micro-Exports” thinking on global exportability, amongst most of the ‘micro-power-nations’ and ‘super-power-nations’ creates “productive occupationalism” and keeps their restless citizenry away from magnetizing towards populism.

The New Blocks: With global block emerging, The RCEP, ‘Regional Comprehensive Economic Partnership’, now the world’s largest free trading block comes into action. Australia, Brunei, Cambodia, China, Indonesia, Japan, South Korea, Laos, Malaysia, Myanmar, New Zealand,  Philippines, Singapore, Thailand, Vietnam. Upskilling exporters and reskilling manufacturers the new way of the future to create grassroots prosperity becomes a logical progression.

The Economic Recovery: The G20 members are Argentina, Australia, Brazil, Canada, China, France, Germany, India, Indonesia, Italy, Japan, Mexico,  ​Republic o​f Korea,​Russia, Saudi Arabia, South Africa, ​​​Turkey, the United Kingdom, the United States and the EU the European Union. They have serious differences and critical pathways, but the commonalities of problem points to pandemic recovery and economic prosperity gaps to calm restless citizenry. Nevertheless, missing from the main action plans, the national mobilization of entrepreneurialism to create upskilling platforms to upscale small medium business bases will be a serious challenge. Optimizations of zoomerang culture of high quality virtual events are still at infancy… therefore, next generation of curated events will bring global economics more closely and display new thinking live across the world. 

The rest is easy.

Naseem Javed is a corporate philosopher, Chairman of Expothon Worldwide; a Canadian Think tank focused on National Mobilization of Entrepreneurialism Protocols on Platform Economy and exportability solutions now gaining global attention. His latest book; Alpha Dreamers; the five billions connected who will change the world.

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Economy

Reforms Key to Romania’s Resilient Recovery

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Over the past decade, Romania has achieved a remarkable track record of high economic growth, sustained poverty reduction, and rising household incomes. An EU member since 2007, the country’s economic growth was one of the highest in the EU during the period 2010-2020.

Like the rest of the world, however, Romania has been profoundly impacted by the COVID-19 pandemic. In 2020, the economy contracted by 3.9 percent and the unemployment rate reached 5.5 percent in July before dropping slightly to 5.3 percent in December. Trade and services decreased by 4.7 percent, while sectors such as tourism and hospitality were severely affected. Hard won gains in poverty reduction were temporarily reversed and social and economic inequality increased.

The Romanian government acted swiftly in response to the crisis, providing a fiscal stimulus of 4.4 percent of GDP in 2020 to help keep the economy moving. Economic activity was also supported by a resilient private sector. Today, Romania’s economy is showing good signs of recovery and is projected to grow at around 7 percent in 2021, making it one of the few EU economies expected to reach pre-pandemic growth levels this year. This is very promising.

Yet the road ahead remains highly uncertain, and Romania faces several important challenges.

The pandemic has exposed the vulnerability of Romania’s institutions to adverse shocks, exacerbated existing fiscal pressures, and widened gaps in healthcare, education, employment, and social protection.

Poverty increased significantly among the population in 2020, especially among vulnerable communities such as the Roma, and remains elevated in 2021 due to the triple-hit of the ongoing pandemic, poor agricultural yields, and declining remittance incomes.

Frontline workers, low-skilled and temporary workers, the self-employed, women, youth, and small businesses have all been disproportionately impacted by the crisis, including through lost salaries, jobs, and opportunities.

The pandemic has also highlighted deep-rooted inequalities. Jobs in the informal sector and critical income via remittances from abroad have been severely limited for communities that depend on them most, especially the Roma, the country’s most vulnerable group.

How can Romania address these challenges and ensure a green, resilient, and inclusive recovery for all?

Reforms in several key areas can pave the way forward.

First, tax policy and administration require further progress. If Romania is to spend more on pensions, education, or health, it must boost revenue collection. Currently, Romania collects less than 27 percent of GDP in budget revenue, which is the second lowest share in the EU. Measures to increase revenues and efficiency could include improving tax revenue collection, including through digitalization of tax administration and removal of tax exemptions, for example.

Second, public expenditure priorities require adjustment. With the third lowest public spending per GDP among EU countries, Romania already has limited space to cut expenditures, but could focus on making them more efficient, while addressing pressures stemming from its large public sector wage bill. Public employment and wages, for instance, would benefit from a review of wage structures and linking pay with performance.

Third, ensuring sustainability of the country’s pension fund is a high priority. The deficit of the pension fund is currently around 2 percent of GDP, which is subsidized from the state budget. The fund would therefore benefit from closer examination of the pension indexation formula, the number of years of contribution, and the role of special pensions.

Fourth is reform and restructuring of State-Owned Enterprises, which play a significant role in Romania’s economy. SOEs account for about 4.5 percent of employment and are dominant in vital sectors such as transport and energy. Immediate steps could include improving corporate governance of SOEs and careful analysis of the selection and reward of SOE executives and non-executive bodies, which must be done objectively to ensure that management acts in the best interest of companies.

Finally, enhancing social protection must be central to the government’s efforts to boost effectiveness of the public sector and deliver better services for citizens. Better targeted social assistance will be more effective in reaching and supporting vulnerable households and individuals. Strategic investments in infrastructure, people’s skills development, and public services can also help close the large gaps that exist across regions.

None of this will be possible without sustained commitment and dedicated resources. Fortunately, Romania will be able to access significant EU funds through its National Recovery and Resilience Plan, which will enable greater investment in large and important sectors such as transportation, infrastructure to support greater deployment of renewable energy, education, and healthcare.

Achieving a resilient post-pandemic recovery will also mean advancing in critical areas like green transition and digital transformation – major new opportunities to generate substantial returns on investment for Romania’s economy.

I recently returned from my first official trip to Romania where I met with country and government leaders, civil society representatives, academia, and members of the local community. We discussed a wide range of topics including reforms, fiscal consolidation, social inclusion, renewably energy, and disaster risk management. I was highly impressed by their determination to see Romania emerge even stronger from the pandemic. I believe it is possible. To this end, I reiterated the World Bank’s continued support to all Romanians for a safe, bright, and prosperous future.

First appeared in Romanian language in Digi24.ro, via World Bank

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US Economic Turmoil: The Paradox of Recovery and Inflation

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The US economy has been a rollercoaster since the pandemic cinched the world last year. As lockdowns turned into routine and the buzz of a bustling life came to a sudden halt, a problem manifested itself to the US regime. The problem of sustaining economic activity while simultaneously fighting the virus. It was the intent of ‘The American Rescue Plan’ to provide aid to the US citizens, expand healthcare, and help buoy the population as the recession was all but imminent. Now as the global economy starts to rebound in apparent post-pandemic reality, the US regime faces a dilemma. Either tighten the screws on the overheating economy and risk putting an early break on recovery or let the economy expand and face a prospect of unrelenting inflation for years to follow.

The Consumer Price Index, the core measure of inflation, has been off the radar over the past few months. The CPI remained largely over the 4% mark in the second quarter, clocking a colossal figure of 5.4% last month. While the inflation is deemed transitionary, heated by supply bottlenecks coinciding with swelling demand, the pandemic-related causes only explain a partial reality of the blooming clout of prices. Bloomberg data shows that transitory factors pushing the prices haywire account for hotel fares, airline costs, and rentals. Industries facing an offshoot surge in prices include the automobile industry and the Real estate market. However, the main factors driving the prices are shortages of core raw materials like computer chips and timber (essential to the efficient supply functions of the respective industries). Despite accounting for the temporal effect of certain factors, however, the inflation seems hardly controlled; perverse to the position opined by Fed Chair Jerome Powell.

The Fed already insinuated earlier that the economy recovered sooner than originally expected, making it worthwhile to ponder over pulling the plug on the doveish leverage that allowed the economy to persevere through the pandemic. The main cause was the rampant inflation – way off the 2% targetted inflation level. However, the alluded remarks were deftly handled to avoid a panic in an already fragile road to recovery. The economic figures shed some light on the true nature of the US economy which baffled the Fed. The consumer expectations, as per Bloomberg’s data, show that prices are to inflate further by 4.8% over the course of the following 12 months. Moreover, the data shows that the investor sentiment gauged from the bond market rally is also up to 2.5% expected inflation over the corresponding period. Furthermore, a survey from the National Federation of Independent Business (NFIB) suggested that net 47 companies have raised their average prices since May by seven percentage points; the largest surge in four decades. It is all too much to overwhelm any reader that the data shows the economy is reeling with inflation – and the Fed is not clear whether it is transitionary or would outlast the pandemic itself.

Economists, however, have shown faith in the tools and nerves of the Federal Reserve. Even the IMF commended the Fed’s response and tactical strategies implemented to trestle the battered economy. However, much averse to the celebration of a win over the pandemic, the fight is still not through the trough. As the Delta variant continues to amass cases in the United States, the championed vaccinations are being questioned. While it is explicable that the surge is almost distinctly in the unvaccinated or low-vaccinated states, the threat is all that is enough to drive fear and speculation throughout the country. The effects are showing as, despite a lucrative economic rebound, over 9 million positions lay vacant for employment. The prices are billowing yet the growth is stagnating as supply is still lukewarm and people are still wary of returning to work. The job market casts a recession-like scenario while the demand is strong which in turn is driving the wages into the competitive territory. This wage-price spiral would fuel inflation, presumably for years as embedded expectations of employees would be hard to nudge lower. Remember prices and wages are always sticky downwards!

Now the paradox stands. As Congress is allegedly embarking on signing a $4 trillion economic plan, presented by president Joe Bidden, the matters are to turn all the more complex and difficult to follow. While the infrastructure bill would not be a hard press on short-term inflation, the iteration of tax credits and social spending programs would most likely fuel the inflation further. It is true that if the virus resurges, there won’t be any other option to keep the economy afloat. However, a bustling inflationary environment would eventually push the Fed to put the brakes on by either raising the interest rates or by gradually ceasing its Asset Purchase Program. Both the tools, however, would risk a premature contraction which could pull the United States into an economic spiral quite similar to that of the deflating Japanese economy. It is, therefore, a tough stance to take whether a whiff of stagflation today is merely provisional or are these some insidious early signs to be heeded in a deliberate fashion and rectified immediately.

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Carbon Market Could Drive Climate Action

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Authors: Martin Raiser, Sebastian Eckardt, Giovanni Ruta*

Trading commenced on China’s national emissions trading system (ETS) on Friday. With a trading volume of about 4 billion tons of carbon dioxide or roughly 12 percent of the total global CO2 emissions, the ETS is now the world’s largest carbon market.

While the traded emission volume is large, the first trading day opened, as expected, with a relatively modest price of 48 yuan ($7.4) per ton of CO2. Though this is higher than the global average, which is about $2 per ton, it is much lower than carbon prices in the European Union market where the cost per ton of CO2 recently exceeded $50.

Large volume but low price

The ETS has the potential to play an important role in achieving, and accelerating China’s long-term climate goals — of peaking emissions before 2030 and achieving carbon neutrality before 2060. Under the plan, about 2,200 of China’s largest coal and gas-fired power plants have been allocated free emission rights based on their historical emissions, power output and carbon intensity.

Facilities that cut emissions quickly will be able to sell excess allowances for a profit, while those that exceed their initial allowance will have to pay to purchase additional emission rights or pay a fine. Putting a price tag on CO2 emissions will promote investment in low-carbon technologies and equipment, while carbon trading will ensure emissions are first cut where it is least costly, minimizing abatement costs. This sounds plain and simple, but it will take time for the market to develop and meaningfully contribute to emission reductions.
The initial phase of market development is focused on building credible emissions disclosure and verification systems — the basic infrastructure of any functioning carbon market — encouraging facilities to accurately monitor and report their emissions rather than constraining them. Consequently, allocations given to power companies have been relatively generous, and are tied to power output rather than being set at absolute levels.

Also, the requirements of each individual facility to obtain additional emission rights are capped at 20 percent above the initial allowance and fines for non-compliance are relatively low. This means carbon prices initially are likely to remain relatively low, mitigating the immediate financial impact on power producers and giving them time to adjust.

For carbon trading to develop into a significant policy tool, total emissions and individual allowances will need to tighten over time. Estimates by Tsinghua University suggest that carbon prices will need to be raised to $300-$350 per ton by 2060 to achieve carbon neutrality. And our research at the World Bank suggest a broadly applied carbon price of $50 could help reduce China’s CO2 emissions by almost 25 percent compared with business as usual over the coming decade, while also significantly contributing to reduced air pollution.

Communicating a predictable path for annual emission cap reductions will allow power producers to factor future carbon price increases into their investment decisions today. In addition, experience from the longest-established EU market shows that there are benefits to smoothing out cyclical fluctuations in demand.

For example, carbon emissions naturally decline during periods of lower economic activity. In order to prevent this from affecting carbon prices, the EU introduced a stability reserve mechanism in 2019 to reduce the surplus of allowances and stabilize prices in the market.

Besides, to facilitate the energy transition away from coal, allowances would eventually need to be set at an absolute, mass-based level, which is applied uniformly to all types of power plants — as is done in the EU and other carbon markets.

The current carbon-intensity based allocation mechanism encourages improving efficiency in existing coal power plants and is intended to safeguard reliable energy supply, but it creates few incentives for power producers to divest away from coal.

The effectiveness of the ETS in creating appropriate price incentives would be further enhanced if combined with deeper structural reforms in power markets to allow competitive renewable energy to gain market share.

As the market develops, carbon pricing should become an economy-wide instrument. The power sector accounts for about 30 percent of carbon emissions, but to meet China’s climate goals, mitigation actions are needed in all sectors of the economy. Indeed, the authorities plan to expand the ETS to petro-chemicals, steel and other heavy industries over time.

In other carbon intensive sectors, such as transport, agriculture and construction, emissions trading will be technically challenging because monitoring and verification of emissions is difficult. Faced with similar challenges, several EU member states have introduced complementary carbon taxes applied to sectors not covered by an ETS. Such carbon excise taxes are a relatively simple and efficient instrument, charged in proportion to the carbon content of fuel and a set carbon price.

Finally, while free allowances are still given to some sectors in the EU and other more mature national carbon markets, the majority of initial annual emission rights are auctioned off. This not only ensures consistent market-based price signals, but generates public revenue that can be recycled back into the economy to subsidize abatement costs, offset negative social impacts or rebalance the tax mix by cutting taxes on labor, general consumption or profits.

So far, China’s carbon reduction efforts have relied largely on regulations and administrative targets. Friday’s launch of the national ETS has laid the foundation for a more market-based policy approach. If deployed effectively, China’s carbon market will create powerful incentives to stimulate investment and innovation, accelerate the retirement of less-efficient coal-fired plants, drive down the cost of emission reduction, while generating resources to finance the transition to a low-carbon economy.

(Martin Raiser is the World Bank country director for China, Sebastian Eckardt is the World Bank’s lead economist for China, and Giovanni Ruta is a lead environmental economist of the World Bank.)

(first published on China Daily via World Bank)

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