No image available
/ 26 September 2006
An awful lot of water has passed under the bridge since the International Monetary Fund and World Bank last met in Asia. In 1997, when the annual gatherings were held in Hong Kong, power in the former British colony had only just been handed over to China, Gordon Brown had been British finance minister for only four months and Asia was in the grip of a ferocious financial crisis.
The first full-scale audit of how the G8 group of leading industrialised nations has performed on its promises to the world’s poor since last year’s Gleneagles summit has revealed that rich countries are failing to meet almost all the targets they set themselves.
When he was 11, Ben Bernanke, the spelling champ from South Carolina, was within a whisker of appearing on The Ed Sullivan Show. Back in 1965, this was a big deal. But Bernanke couldn’t remember how many ”i”s there were in edelweiss and missed the televised national final by one mark. For Bernanke, it proved a minor setback on the road from boy prodigy to chairperson of the Federal Reserve.
A day of panic selling in the world’s financial markets on Tuesday knocked off the price of a barrel of oil, provided the sharpest one-day fall in gold for 13 years. Amid growing fears that rising global interest rates could bring a halt to the boom in asset prices of recent years, the toughest day for Japan’s Nikkei index since the 9/11 terrorist attacks was followed by extreme nervousness in European markets.
Strong trade unions and employment-protection laws can go hand-in-hand with low levels of unemployment, the West’s leading think tank said last week in a keynote study that rejected the notion that there was a single blueprint for a successful labour market.
The Dow Jones Industrial Average slid back below the 11 000 mark in early trading on Tuesday after falling nearly 200 points on Monday, as Ben Bernanke’s baptism of fire as chairperson of the United States Federal Reserve prompted a fresh bout of jitters on Wall Street.
Ghana has its own stock exchange. True, it only trades shares in 30 companies and is only open for three hours a day, but you have to start somewhere. As the trade minister, Alan Kyerematen, puts it: ”This is the Wall Street of Ghana. Wall Street used to be like this once.”
It was just the sort of message British Finance Minister Gordon Brown wanted to see. As he arrived at the Hilton in the Nigerian capital of Abuja this week to warn Africa that stamping out corruption was the flipside of greater financial generosity from the West, the TV monitor behind the reception desk said: ”Important notice. Anti-money-laundering measures are observed in this hotel.”
Gold is through an ounce for the first time in a quarter of a century. Platinum prices have gone through the roof. Copper is now so expensive that the metal in a two pence coin is now worth three pence. Oil is trading at between and a barrel. But beware, it is a time of extreme danger for the unwary, with all the sadly familiar tell-tale signs of trouble ahead.
World stock markets finally expunged the memories of one of the worst bear markets in history recently when they surpassed the levels reached ahead of the collapse of the dotcom bubble in 2000. The most widely used yardstick of equity performance around the globe, showed that a recovery in developed economies coupled with boom conditions in emerging markets has created a new record for shares.