by Mark Weston | May 7, 2009 | Conflict and security, Middle East and North Africa
Two major cruise lines – Fred Olsen and MSC Cruises – have announced that they are dropping their Indian Ocean routes to avoid Somali pirates. From now on, their ships will go round the Horn of Africa and up the west coast, instead of crossing the Gulf of Aden and the Suez Canal. This will hurt the economies of stopping points like Dubai, Oman, Jeddah and Egypt, as they lose out on docking fees and cruise ship passengers are forced to divert their spending to West African ports (or, more likely given the absence of gleaming shopping malls on that coast, bypass the entire shore). It could be the cue for a more concerted response to piracy by Middle Eastern governments, which haven’t yet done much to tackle the piracy epidemic.
For the cruise liners, West Africa might appear a safer bet, but as I mentioned here a few months ago, going the other way round the continent is far from risk free. It may be that West African criminal networks, which are notorious for their protean nature, expand into piracy (piracy in the region has so far mostly been limited to attacks on oil tankers off Nigeria).
Antonio Mazzitelli of the United Nations Office on Drugs and Crime told me recently that West African criminal networks switch easily from one activity to another: “Networks are built purely for carrying out a specific business,” he said. “Someone might do one job and then move to a completely different job.” Law enforcement authorities, including those in the West, are not well adapted to such fluidity – “they are crime-specialised,” said Mazzitelli, “those who look at drugs don’t look at internet fraud, and the latter don’t look at stolen vehicles, for example.” The US navy has recently begun training Nigeria’s navy to fight off pirate attacks on oil tankers, but they may have to broaden their scope if West African criminals take a leaf out of their Somali brothers’ books and target cruise liners as well.
by Alex Evans | May 6, 2009 | What we're watching
[youtube]http://www.youtube.com/watch?v=ka_KfSPkrw4[/youtube]
by Alex Evans | May 6, 2009 | Economics and development, Influence and networks
Something I didn’t know: Portugal has way more liberal drug laws than the Netherlands. In fact, it’s the first European country to have abolished all criminal penalties for personal possession of all drugs: marijuana, cocaine, heroin, methamphetamine, the lot. That was over five years ago. Now, there’s been a major study of what happened. Guess what?
…in the five years after personal possession was decriminalized, illegal drug use among teens in Portugal declined and rates of new HIV infections caused by sharing of dirty needles dropped, while the number of people seeking treatment for drug addiction more than doubled.
“Judging by every metric, decriminalization in Portugal has been a resounding success,” says Glenn Greenwald, an attorney, author and fluent Portuguese speaker, who conducted the research. “It has enabled the Portuguese government to manage and control the drug problem far better than virtually every other Western country does.”
Compared to the European Union and the U.S., Portugal’s drug use numbers are impressive. Following decriminalization, Portugal had the lowest rate of lifetime marijuana use in people over 15 in the E.U.: 10%. The most comparable figure in America is in people over 12: 39.8%. Proportionally, more Americans have used cocaine than Portuguese have used marijuana.
The Cato paper reports that between 2001 and 2006 in Portugal, rates of lifetime use of any illegal drug among seventh through ninth graders fell from 14.1% to 10.6%; drug use in older teens also declined. Lifetime heroin use among 16-to-18-year-olds fell from 2.5% to 1.8% (although there was a slight increase in marijuana use in that age group). New HIV infections in drug users fell by 17% between 1999 and 2003, and deaths related to heroin and similar drugs were cut by more than half. In addition, the number of people on methadone and buprenorphine treatment for drug addiction rose to 14,877 from 6,040, after decriminalization, and money saved on enforcement allowed for increased funding of drug-free treatment as well.
All of which makes you wonder: given that Mexico’s drug war – which is responsible for many, many, many more deaths than swine flu – stems largely from the Prohibition policies in the US, what’s the US waiting for?
by Alex Evans | May 6, 2009 | East Asia and Pacific, South Asia
As Sri Lanka’s assault on the Tamil Tigers continues, Kotare has an interesting observation on an angle of the conflict that I’d missed:
While the US is entangled in an escalating war in Afghanistan, China is quietly strengthening its strategic position in the Indian Ocean. One sign of this is the way Beijing is helping the Sri Lankan government crush the Tamil Tigers while building a port at Hambantota, on Sri Lanka’s south coast.
China’s Achilles heel is its reliance on imported oil and minerals from the Middle East and Africa, and the need to ship those resources across the Indian Ocean and through the Straits of Melaka and the South China Sea. This poses a security problem for Beijing. If China and the US went to war, say over Taiwan, the US Navy could stop the flow of oil and minerals and do real damage to the Chinese economy and war machine. Similarly, India, which has a large navy, could interdict China’s ships in the Indian Ocean.
To safeguard its shipping, China needs to be capable of projecting power into the Indian Ocean, the Middle East and Africa. From ports and airfields like Hambantota, sited along the Eurasian seaways like a ‘string of pearls’, Chinese forces could gather intelligence, protect its shipping and attack hostile navies.
by Alex Evans | May 6, 2009 | East Asia and Pacific, Economics and development, Global system
Back in March, I flagged up the significance of a proposal from Zhou Xiaochuan, China’s central bank governor, for the dollar to be replaced as the world’s reserve currency with a new, more multilateral system based on Special Drawing Rights – and noted that his proposal harked back explicitly to discussions at the Bretton Woods summit in 1944.
As Ngaire Woods points out over at the GEG blog, this is just one component of a Chinese strategy for pursuing power shift in the international monetary order. Another is the increasingly emphatic Chinese tone on the need for IMF reform – with Wen Jiabao making clear back in March that much-needed additional Chinese contributions to the IMF would be contingent on more voice for developing countries.
Now, another important plank of their reform drive has been unveiled: a new $120 billion emergency currency pool based on the existing Chiang Mai initiative. Details according to the WSJ:
The initiative aims to create a network of bilateral currency-swap arrangements among Asean and the three East Asian countries. Asean includes Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar, the Philippines, Singapore, Thailand and Vietnam.
Japan, South Korea and China will provide 80% of the $120 billion currency pool and Asean members the remaining 20%. Japan will contribute $38.4 billion, while China, including Hong Kong, will also offer $38.4 billion. South Korea will provide $19.2 billion. Under terms of the program, smaller Asian economies will be able to borrow larger amounts in proportion to their contributions than the more-developed economies.
As Ngaire observes, proposals in the late 1990s for a new Asian Monetary Fund were publicly torpedoed by the US, but it’s the bilateral swap arrangements that Asian nations started to agree then that have grown into the initiative announced yesterday. And, she stresses,
It is worth highlighting that while China is politely offering something to the IMF (it announced a contribution of $40 billion), it has just announced an almost equivalent contribution ($38.4 billion) to the Asian pool.
All this creates useful independence from the IMF, she continues:
…the ASEAN+3 countries have created for themselves an alternative to borrowing from the IMF. Their arrangements actually use the IMF as a monitor, but crucially guard control (within the region) over their shared reserves. It has emerged in no small part because countries in the region see the IMF as a useful but American instrument of economic coordination.
