GLOBAL TRANSFORMATION TOWARDS MDG JOYDIP CHAKLADAR Table of Contents 1.0 Integrated planning required for Global Energy Needs............................3 2.0 Social Sector Banking: Proper treasury services could create the accountability for treasury replenishment goals. ? .........................................3 3.0 Behind the Frontline : The Rear Enemy...................................................4 4.0 The Age of Supra Nationality ...................................................................5 5.0 Fighting against corruption : The way to global economic salvation ........5 6.0 Credit crisis 2008: The worst ever financial crisis in last 60 years ? ........6 7.0 The Fight against Global terrorism is creating it.......................................8 8.0 Global Governance - Right time for trying this option? ............................9 1.0 Integrated planning required for Global Energy Needs. The World faces a great challenge on meeting its energy needs. Some of the wars, which recently had, take surface, has the key component of aggressively acquiring energy bases of other nations. Energy is a vital input for production of any sort .It also helps to increase the overall competitiveness of a Nation. That is the reason there is so much fight between nation towards each particular nation’s energy security and sustainability. It is the key thought of all the National leaders. The series of crisis, heating one after another into the world, shows the need of growth of our future energy base. The basic elements like water and food are becoming scarcer by improper handling of natural resources. Still, there has been a lack of integrated planning on terms of fulfilling the global energy needs. Instead of getting into wars for increasing the energy bases of particular countries, there has to be a reasonable co-operation between the governments of the nations, to create a new line of thought, on production of energy, according to global needs. A global energy problem requires dealing, beyond national political barriers. 2.0 Social Sector Banking: Proper treasury services could create the accountability for treasury replenishment goals. ? Treasury services include different types, of financial instruments not limited to treasury management, foreign exchange, short-term credit facilities, trade finance, and global liquidity management. The most important part of the services is treasury planning. Bank of America with GTS (Global Treasury Services) provides a robust technology based planning for businesses and institution with integration of supply chain finance technology and supplier outreach service with further enhancing its trade-discounting program. This enables them to reduce working capital requirements, finance cost through their supply chain, strengthen operating margins, and develop stronger supplier relationship. Replenishment program for the future days is the key parameter for treasury service planning in social sector banking. For example, International Development Agency (IDA), which is an arm of World Bank, gives credit to the poorest-of-poor countries. After every 3 years, this body goes through a replenishment program where it asks for more funds, from its donor countries. Only proper Treasury services could create the accountability to realize the Treasury replenishment goals for social sector banking. The front line enemy of the global financial crisis is obviously the burst of housing bubble. However, there is a more powerful rear enemy , yet to come with its full force in the front line . 3.0 Behind the Frontline : The Rear Enemy The shift of production of food grains by replacing, it with the bio-diesel related production in the hope of reaching Crude (Oil) heaven could be referred as the rear enemy, who is yet to come in the front line with his full force. Still, it has been responsible for the much damage, which it caused with its silent impact, on the household expenses. The supply of food grains has been reduced in the global market , which has lead to inflation of the necessary commodities in the common household cost structure . The effect was drastic in the countries of middle-east and far east Asia. In normal cases , the 1/3 of the household budget goes for debt servicing . However with the rising food prices and related commodities , that 1/3 budget has to be cut off, into smaller budget and at the end no-budget , due to priorities of recurring expenses, related to essential commodities much higher, than the debt servicing budget . The end product is the bursting of the housing bubble which lead to global financial crisis. 4.0 The Age of Supra Nationality Europe has learned it after second world war . They had the experience of how the focus on physical territory and religion of nationalism can destroy the entire continent . So they continously put an effort, to create a higher union, which goes beyond physical territories and the religion of nationalism . The efforts has shown fruits with the establishment of G8+5 and European Union ,where there is larger co-operation between Nations, both in a informal and a formal way. Somehow , Asia as a continent has lacked those experience what Europe has gone through . That is the reason that Asian continent has not experienced such broader colloboration in all levels of economy , society and politics. There is still proxy wars going between the countries in Middle East and South East Asia . The latest example is the Suicide Bomd Burst in Indian Emabassy in Afghanisthan which killed 41 people. There is no idea, when the nations of this continent will understand and think beyond physical territories, and give more priority to the people living in this continent, and thier economic and social salvation. Until that understanding takes root in the minds of leaders of these part of the world , there is little possibility to fight against the social evils together which all of them are suffering from. 5.0 Fighting against corruption : The way to global economic salvation Corruption is one of the major elements, which has decreased the ability of the global economic systems to fight poverty. Looking at the Millennium Development Goals (MDG), one would wonder, how far, we are on fighting poverty, in regards to the target year of 2015. There we could see ,that, lot of efforts of building efficient systems ,to make things work for common people, on eradicating poverty, are drained away by corruption. The latest example was the 'Oil-for Food scam' , where top officials of large scale global institutions are found to be involved . This kind of scams, are eye-openers, how the money, which goes to eradicate poverty, gets routed to different channels , and, often the purpose of the benefit of common people are ignored. Though the problem of corruption, is fundamental to human society, and it exsisted in different forms across, different civilisation at different point of time. The real solution, lies on building process which could stop degeneration of human values. Some says, that the present world with the extensive usage of large scale IT systems and processes is well equiped to solve it . It's true that , with the present generation of technology sophistication , the chances of malpractices are decreased . However the orgination of corruption is in human mind . It is created by excessive lust and greed . How can technology solve this fundamental defects of human nature ? That's why fighting against corruption is more internal that external . Without a strong battle with corruption , it looks impossible to visualise the way to global economic salvation. 6.0 Credit crisis 2008: The worst ever financial crisis in last 60 years ? I have been contemplating on the idea, that, what makes a great food for constructive financial thought,for some time . What can be a better time, than now, to explore, that contemplation, in new dimension, with one of the worst financial crisis within last 60 years hitting hard globally, -'The Credit crisis of 2008'. Here is what, successful Hedge Fund manager, George Soras, says in Financial tmes, who is also the chairman of Soros Fund Management way back in January 23,2008 in The Financial Times Article . Things has deteriorated further, from there, and it seems, that the global financial institution are in a free fall . George makes an interesting comment on the article about the general perception on market moving towards equilibrium. An alumni of London school of business , talking apart from the crowd , says , that the market generally does not move towards an equilibrium. It is the reflexive systems of collective sentiments that create the realities of the market . Few years back , I have been writing the same ideas, though was coined very differently . On my first book named as "You can perform miracles too" - YCPT , I was referring to a principle thought which establishes that 'consciousness creates reality' . The change of consciousness can lead to change of reality . Same way market has its own consciousness , which is somehow a dependent phenomenon, on the collective sentiments ruled either by fear, or by optimism. So there is the boom-burst cycle . A collective fear creates the burst cycle . Same way , a collective optimism makes the boom cycle. It proves the fact that market consciousness is representation of the collective emotions on global scale . The new range of technology and connectivity has given rise to new levels of scalability on market sentiments . So when there is fear , it spreads from one corner to another corner within the fall of eyelid, resulting sudden bail outs of investors . When there is a collective hope springs up , suddenly you see a huge number of funds flowing on the same markets . This kind of fluctuation is the reason , there is a need of regulation .However, it seems our financial institution have gone a long way, on making irresponsible, and complex financial instruments ,which have become somehow so hard to regulate, that the regulators , have put their hands up, and expect the institution in their own, to regulate their products, without the broader understanding of macro-economic interest . The result is what a selfish and greedy profit seeker corporate professionals should achieve, in the cost of negligence of wider macroeconomic factors.In that situation , what better can be expected other than a credit crisis, which is shaking the fundamentals of not only financial institution but also the policies related to structural adjustment , globalization and neo-liberal reforms ? 7.0 The Fight against Global terrorism is creating it? "All human beings are born free and equal in dignity and rights. They are endowed with reason and conscience and should act towards one another in a spirit of brotherhood" - Artcle 1 in United Nations Universal Declaration of human rights (UDHR) Is this a mere academic statement ? . How much of it, is practiced in global context ? Recently , Human Rights watch ,published a detailed documentation about how criminal prosecution has been done on some developed countries to innocent terrorist, suspect, with using minimal evidence. See the report http://www.hrw.org/english/docs/2008/07/02/france19186.htm The fight against global terrorism should not create the same, in any form . That is the sure way to make us defeated , in the war against global terrorism. The effect of an innocent , getting punished, by loosely defined terrorism laws is severe. Rather then decreasing the participation of civil society in terrorist outfits, it could increase it . By any means there has to be substantial legal reforms, globally ,that innocent doesn't get punished . This should be the objective of any juidicial system throughout the world. 8.0 Global Governance - Right time for trying this option? The emergence of Global corporation has made it important , that the regulation, which has national restriction should have wider scope. The need of regulation, which meets the global benchmark, is also growing. The sweeping credit crisis of 2008, is again raising the question, that much responsibilities has been shrugged of by the regulators, due to the complexity of the process, on deriving a regulation involving number of countries. The success of EU and the G7 and other formats of governance, spreaded around multiple nations are gaining momentum . To make sure that we don't fall into a global financial crisis for irresponsible actions of one particular nation, it is important to explore the options of Global governance. With the G7 being holded right now in Japan , this issue of building up a global governence, which could lead us to better management of Food crisis, Oil Crisis, Climate crisis and Credit crisis should be worked out. The solution to these crisis, would involve thinking , beyond political border , within , a standard framework of Global Governance .
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