The singular growth process of India (I)

Generally, the economic growth process is a sequence that starts with the loss of importance of the agricultural sector (either the percentage of GDP or in percentage of the workforce employed) and an increase of the importance of industry first, and services next.

As the economic growth nears maturity, the dominant sector is the services, followed generally by the industry and then by agriculture.
However, the economic growth process of India was deviated from this common process, going straight from agriculture to the leadership of the service sector.
The lack of industrial development was due in very of the presence of a stifling regulation, especially in the legislation about the work and the policies about the small size industries.
Another unusual aspect is the permanence of the same distribution of the employed population among the diverse sectors: the majority of the employed population still remain in the agriculture.

The IT related activities still represent a small parcel of the service sector. The sub-sectors that had increase considerably due to economic liberalization were the business services, comunications and banks.
However, due to high qualifications, and technic capacity of human resources in IT field, we expect that this will the sub-sector with the higher increase in the next years.
And could India have a sustained economic growth in the future, without the industrial sector? The most likely scenario is no.
The manufactured production will be a way to India have a sustentable growth, and will contribute to the poverty reduction.
One of the fundamental variables to the manufactury development will be the increase in qualifications and skills of the rural population.
A more qualificated population together with a liberalization of agriculture, would allow an exit of workforce to the more procutive areas.
This process will fortify the pruduction level of the rural areas and generate a bigger work suplly to the manufactury activity.
Through this process, India will have a economic path similar to its asiatic neighbors, and could also have a biggest urbanization of its territory.

In the last 50 years, India has change its isolation policy (namely, domestic view policy): the increasly economic liberalization and gradual opening to the world economy, boosted the economic growth rate and lifted millions out of poverty.
If these reforms are maintained and move forward at the same rytm and intensity in the next 10-15 years, then the economy could increase in an average of 6%/year.
However, if the reforms will be deeper , the GDP coul increase an average of 7-8% per year in the same period.
In 2020 India would be the economy with thw higher annual economic growth, and the 3rd biggest economy in the world (behind China and USA). Its GDP per capita also could duplicate in the same period of time.
This projection will only be possible if the demographic conditions remain the same. And these conditions will be discussed in the next message.

Eurovision 2015: Vienna is comming (I)

Yes I'm back with my comments about the Eurovision's entries. This year we are going to Vienna, and I'll start to comment the choice from my own country.

PORTUGAL AND LEONOR ANDRADE

Like in some many years in the past, the portuguese public broadcast (RTP) held the 'Festival da Canção' in March to select its representative for the Eurovision Song Contest. In the last years we have watched some changes in the selection process. The same happened this year, with the (re)introduction of two semifinals, one final and a super-final. In the semifinals and in the final three songs were chosen - two by the public and the other but the composers - to advance for the next round.
Despite the differences the Fetsival received the same criticisms by some people about the repetition of the same music style and the weakness of the songs. Also this new method of asking to all the composers to  select a music from the 'competition' to advance to the next round was very criticized. However, the public agreed with almost all the qualifiers from the semi-finals. The same we cannot say about the qualifiers for the super-final with many people expecting to see Yola in this last round. After all, the public with 100% of decision power, chose Leonor Andrade to represent Portugal in Vienna in May.

This year we had the return of one of the symbols of the portuguese participation in the Eurovision: Simone de Oliveira, the portuguese representative in  1965 and 1969. Simone de Oliveira was qualified for the final but missed the qualification for the super-final. As for the other participants, most of them were known from their participation in some portuguese talent shows (like the winner) and/or from previous participations in the Festival, like Filipa Baptista in 2009 (that failed to qualify from the semi-final) and Teresa Radamanto in 2007 (that was in the super-final). Like in the previous years, we could see that there are really good voices in Portugaal. Unfortunately the voices are underused and their potential are not fully availed.

This song has definetly many aspects to be improved and Leonor and her team have a long and hard work to do before May. However, even with better and strongest voices in the final, as Yola and Teresa, it's amazing to see Portugal choosing a different style to represent it in the Eurovision.

This year the semifinal where Portugal was allocated is not very hard, but it will not have the political voting from Spain and France, the two countries that usuallt give more points to Portugal. However, improving the performance a qualification is really possible.

The public intervention in the startegic sectors

New year, new life! And it's time to refresh my blog. I will start this new "season" of messages by starting a set of messages about the challenges for the future of the European Union.

The public intervention of the EU-instituions in the strategic sectors

Despite the fact that the EU have some responsabilities on the strategic sectores of the economy, there is no rules or legislation about how to define and how to intervent in the strategic sectors. There is no legislation that defines in which sectors the State needs to intervent. Usually the public intervention is a result of the historic tradition.
Inside the European Union, there is a belief that in the southern countries, the publci intervention os excessive (which can be supported by the current debt crisis) but it's nothing more than a myth. If we see the weight of the public intervention in the total of the economic's activity, we can see that in the Nordic countries is much higher. However, there is no limitation about how far the State can intervent in the economy: not even in each member.

In the last decades we saw among the majority of the EU-members a decrease in the importance of the State's role in the economy. Why is that happening, even not existing legislation about that? Mainly for three reasons:
- the increase in the intern market's dimension;
- the economic liberalization and globalization, which brought the international competitiveness;
- the privatization of the public business sector (an inspiration of the anglo-saxon model);

The big consequence of the decrease of the public intervention is the redution of the instruments the governments can use to make its intervention.
Currently with the redution of the public companies, we see the States giving benefits to the private companies, under the previous authorization of the European Institutions. So, even taking in account the reality of each member, the EU needs to take part on the intervention due to the importance of the sectores not only for the stability of the respective member, but also for the stability of the EU.
There is also another reason for the public intervention: the public economic interest services (different from the social interest services). These services are the activities that don't have the profit maximization as a goal, but a social purporse instead. So the sustainability is guaranteed by the Government.

From the pratical experience, the European Union defined some sctores that can be considered strategic such as:
- Water supply and distribution;
- Energy (the supply and distribution of energy is giving many problems between countries all over the world, including inside the UE, which gives a special attention to this sector);
- Transportation;
- Telecommunications (not only important because allow people to communicate, but also because the telecommunications sector are essential to the functioning of the economy - the vulnerability of our lives is big now because of the privacy questions);
- Defense industry;

To conclude this first message, the criteria that define the protectionist politics at european level, give more importance to the economistic side, withiout giving the right importance to the social and ambiental impacts of the proteccionism.

Porque não conseguem os economistas prever uma crise? (Parte I)

Fazer previsões sobre o futuro da nossa situação económica tornou-se uma grande incógnita

Desde 2008 que o cidadão comum tem recebido quantidades gigantescas de informação sobre a crise económica. Vimos pelos ecrãs dos nossos televisores, ouvimos pela rádio ou lemos em jornais ou pela internet inúmeras notícias e artigos com informação sobre a actual situação económica. A situação chegou ao ponto de o cidadão comum debater assuntos de teor económico como um expert no assunto. Mas o mais curioso é que o cidadão comum parece que conseguiu prever que a crise financeira de 2008 inicaida nos EUA iria afectar seriamente a Europa e que esta não iria acabar em 2009 como muitos economistas afirmaram.
Então, porque os economistas, analistas e estudiosos reagiram de forma tão impotente e estupefacta perante o que se passou na economia mundial nos últimos anos?

Crash de 1929 vs Crise de 2008

Muitas têm sido as comparações feitas entre o crash de 1929 e a crise de 2008. E de facto podemos encontrar no crash de 1929 um dos exemplos que justifica tamanha surpresa dos economistas face ao desenrolar dos acontecimentos na economia internacional nos últimos anos: o excesso de confiança no sistema económico que os levou a acreditar que a economia não poderia passar por uma crise semelhante ao crash de 1929.
O que está na base do que se passou com a economia mundial recentemente, é a consequência dos ciclos económicos e toda a perplexidade e impotência com que os economistas reagiram, mostra o pouco avanço que foi feito pelos cientistas económicos na área da análise, previsão e explicação dos ciclos económicos. E quando os economistas não conseguem ter esta visão de longo-prazo que englobe fases de expansão e declínio, está a falhar o que é mais importante na ciência económica: visão global, pensamento estratégico e capacidade de actuação antecipada e prevenção.
Isto pode chegar a parecer ridículo mas é a verdade. A governação das nossas sociedades centra-se quase exclusivamente na previsão de curto-prazo e muitas vezes apenas se governa como reacção aos fenómenos que acabaram de ocorrer, sem conseguir antecipar qualquer situação por mais iminente que se encontre de ocorrer.
De facto, o excesso de confiança e a crença de que a economia mundial estava "protegida" contra quaisquer crises de carácter devastador, foram os motivos da negligência face aos indicadores, tanto nos anos 20 do século passado, como na primeira década deste século.
Há no entanto obviamente, bastantes diferenças no mundo entre 1929 e 2008. E infelizmente essas diferenças fazem com que a actual crise tenha consequências ainda mais devastadoras e mais duradouras do que a de 1929, ainda para mais pelo facto de que, ao contrário do que até muitos economistas afirmaram, o mundo sofreu duas crises distintas, desde 2008.

Crise de 2008 e crise de 2010: crises financeiras vs crises económicas

Outro factor que explica a impotência de muitos economistas e decisores políticos em reagir a esta crise, reside no facto de na verdade ter ocorrido não uma mas duas crises. Sim é verdade: em 2008 o mundo foi brutalmente atingido por uma crise financeira, esta unicamente causada pela mão do Homem, e provocada pelas consequências da sua obra. Mas em 2010 o mundo sofreu outra crise: desta vez uma crise económica, fruto da evolução do planeta e do próprio ciclo da natureza e que não é fruto da mão do Homem.
Não se devem portanto confundir crises financeiras com crises económicas, se bem que as primeiras podem ajudar a implosão das segundas, como de facto aconteceu em 2010.
Uma crise financeira, sendo única e exclusivamente consequência da acção do Homem, pode ser evitada ou pelo menos pode ver os seus efeitos atenuados. No entanto uma crise económica faz parte das condições do planeta e a Humanidade tem que aprender a viver com ela.
Se analisarmos a História da sociedade humana é fácil constatar que a um período de crescimento e expansão da actividade e aumento da riqueza produzida se seguiu um período de crise com contracção da actividade, aumento do desemprego e redução do rendimento dos agregados económicos. E a frequência com que estes ciclos mudam tem até alguma regularidade, mesmo tendo em conta os factores extraordinários que podem ocorrer: e nestes factores extraordinários encontram-se as acções provocadas pela mão do Homem, como as crises financeiras.


É possível concluir pela História económica que o Homem ao "complexificar" a ciência económica, está a torná-la indomável e algo difícil de analisar e de estudar o seu padrão, agindo preventivamente.
Solução? Aquilo que tem sido apresentado e defendido por vários pensadores: o regresso às origens.

Unpaid internships: exploitation or a consequence of modern trends?

One of the biggest consequences of the current crisis was the incredible increase in the unemployment rate across almost all over the world, and both in the developed and developing countries.
All groups of people were highly affected: the youngers with no experience, the olders with years or even decades of experience, the people with higher education or with the basic education.
However, even being dramatic for the people in the 40's or 50's to find a new job or to change their careers, in my oppinion the problem is even bigger within the youngers, especially those with higher education, because after completing their studies and doing their part of the task, our current society is not corresponding with the other part. But, even not being the fault of the youngers, the reality is that they are who is really suffering the most.
The companies don't want to waste time teaching the youngers, especially because they see that, what the students learn on college is too far away from the reality. Also the recession and the increase in the retirement age don't allow the economy to create enough vacancies for the youngers who are starting to join the labour market.
So we are facing a very hard dilemma: the youngers want and need to find a job, and the labour market can't give them one. What is the solution for this dilemma? On one side we have the youngers, desperate to find a job and to show they value, ready to do anything and to obtain some work experience. On the other side we have the companies that, even the recession and the increase in the retirement age, they always need new employees, But, since the main goal of any company is to maximize the profits, by reducing the costs, the best way to achieve it, is by subcontract and explore the workforce. And the better way to do that, is by the unpaid internships.

Some years ago, before the beggining of the current crisis, this could be seen as an abuse. However, the arguments used now turn it in the best way for the youngers to enter the labour market.
I can admit that one paid internship can be a good way to enter the labour market and to know how the labour market really works. I even made one on holidays. But when the internship is not a summer internship? And when it's lenght is more than 3 or even 6 months? And when the youngers  take not only one but many more unpaid internships? What about the many youngers that arrives to the 30's only doing unpaid internshiops without any permament job?
The argument of "a unpaid position to help the yungers to adapt themselves to the labour market" is not valid anymore? And in fact, it was never valid. The companies are trying to turn the fresh graduates in some kind of some illiterate people, like if they don't even know how to use a computer, how to make mental calculus, or to take care of some tasks. It's true that there is a gap between what is learnt on the college and what is the reality, but that doesn't mean that the graduates are so unable like rocks with diplomas. And a 3 month placement can be used as an argument for the experimental period. And what about the longer internships?
Is it really necessary so much time to learn the tasks, especially when the intern is working always in the same department, in the same team and even doing the same tasks?

The other argument used by the companies is the fact that the interns don't create value for the company, and the comapnies are loosing money and time teaching the interns.
To answer this, we need to analyze what the interns do in the company. Do they start to take important and full of responsabilities tasks? The answer is obvious! But even being the less important tasks, that abyone want to do, they are still necessary for the company's activity.
And no one needs so much time to understand and to make the tasks right!

To conclude, more than never, the unpaid internships are a consequence of the current crisis. And until the power of decision is not balanced between the demand and the supply of work, they will still persist.
Probably the youngers don't have other choice than accept them. But of course, there are limits. When the life, the safety and the respect by the intern are not fullfiled. Even not receiving a salary, the unpaid interns should nottake some situations that don't respect his integrity.
There are a line, beyond it's really considered slavery.

Eurovision in Copenhagen 2014: after-show analysis (II)

Let me analyze now the second semifinal.

This was the semifinal with the most difficult predicitions, since only a few countries are used to make a presence in the grand final. I'm talking about Greece and Romania, which really advanced to the grand final, even thought I need to admit with weaker performances than usual. Especially Romania: there was lots of expectation about the duet Paula &Ovi, but I was very disapppointed with the performance. The same for Greece: I'm glad they changed the style, like last year, but I knew that the juries wouldn't rank the greek entry very high.
As for the other qualifiers, I was expecting the qualification of Norway (Carl really gave a great performance and brought lots of emotion for the stage), Poland (especially due to the public which appreciated such "happy" performance! I didn't like the english part, but it was very funny to see the performance) and Finland (due to the unique style in this semifinal and to the power and energy brought by the band).
As for the others, everything was unknow. Like the previous years Malta was unfairly benefited by juries and Belarus by the public. The first song was to simple and without a climax, and the second was to "plastic" and empty of emotions, and a little bit ridiculous.
I had two positive surprises: the qualification of Switzerland and Slovenia. I was happy for the qualification of these two countries, which rarely advance to the grand final. Both had great peformances on stage. And finally the controversial performance of Conchita. If at the beginning (weeks before the show) many expected a non-qualification of Austria, the tru was that his popularity was growing a lot. This allied to a great performance, put Austria in the grand final.

For the countries that didn't advance for the grand final, the biggest surprise was Israel. Everyone was expecting the qualification of Israel, and even with the bad choice of the dancers' choreography, Israel deserved the qualification due to the great vocals of Mei Finegold.
The Georgian song and performance were the worst before the semifinal and the performance on stage didn't help in anything.
I never understood the Lithuanian and Irish entries, especially the favouritism around the sencond one. The songs and the performances were to confused and even being both good singers, they didn't show their potential on stage that day.
And finally Macedonia. Even being also a good singer, the strange performance didn't help Macedonia to advance to the grand final.

Being a semifinal were almost everyone was a possible finalist, there wasn't big surprises, neither anything special to comment, except of course the non-qualification of Israel.

Eurovision in Copenhagen 2014: after-show analysis (I)

Unfortunately for another year was impossible for me to analyze all the songs in competition.
So at least I want to leave my comment after the show, about the songs and the controversies, which were so many this year!

Semifinal I:

This was the most hard semifinal, with many of the countries that usually go to the grand final. We had many countries that went to the grand final as usually: Ukraine, Azerbaijan, Armenia, Sweden and Russia with all the controversies (more about the country's situation - the anti-gays laws and the situation with Ukraine).
Armenia, Hungary and Sweden were among the favourites since the beginning and their live performances in the tuesday's evening confirmed that. All well performed with strong voices creating interesting performances.
About Ukraine, I was a little desapointed before the great performance and especially the great singer and voice of Zlata. This song was more comercial and empty of content. However Mariya Yaremchuk deserved a place on the grand final.
Also Azerbaijan, even thought the lower popularity of the song, and the performance too simple and minimalist, deserved a place among the finalists. I really like Dilara's voice.
Now the special cases. In this semifinal we had two controversies that reached the final. First Russia. I can't find anything good on the song and on the performance. But for me the most strange thing was the fact that, being a country that created in the past so many anti-gay laws, wants to participate in the most unofficial gay event of the year, also inviting a gay to be on stage. Is Russia trying to show an image about the country different from the reality only to receive votes? Is Russia acting falsely? I think so.
And second Iceland. With an image of non-discrimination, using a performance a little bit confuse. However, even not being among the favourites of this semifinal, Iceland qualified for the saturday's final, despite almost all the predictions. Probably the energy was the key factor.
On the other side, the countries that (almost) never take part in the grand final. First San Marino, which was the big surprise. In the third attempt Valentina Monetta went to grand final. Many people said that after the last year's "great" song was inpossible for San Marino to achieve the grand final due to the political votes that would always put San Marino outside the grand final. But the fact is that, the good performance of Valentina was enough to put San Marino in the grand final for the first time.
The next country for the first time in the grand final was Montenegro. Like San Marino, everyone was saying that if this year Montenegro didn't achieve the grand final, it would neve be possible for this Balkan country. The performance and voice of Sergej were brilliant, which makes me to not understand the so low place in the grand final. Probably with many Balkan countries voting (but not present) in the final, the result would be different.
And finally a country that only last year went to the grand final. the Netherlands. With a song worse, in my oppinion, it was for me a big surprise when I saw the Netherlands as a finalist, and even more when the results were revealed showing that The Netherlands were placed in the first place both in teh juries and the the televoting. The duet have a great voice and the performance was very charismatic: these were the ingredients for the success.
For the countries that didn't advance for the grand final, the big surprises were Estonia and Portugal. Even with all the bad comments saying that Tanija made a bad copy of Euphoria, I always believed in the qualification of Estonia, which didn't occur due to the televoting. For my (amd many others) surprise, it didn't occur. And, even with all the bad comments in the home country, many were the people expecting the qualification of Portugal, which didn't occur due to the juries.
For the other countries, the result was the expected: Moldova sent a very confuse song, Albania made the terrible mistake to change the song to English and the latvian entry was too pathetic to be approved by the audience.