Nobu. Where To Next?

Whilst I accept that the United States is not perfect, I have always been fascinated by the ideology behind 'The American Dream'. The possibility of someone rising to the top 'against all odds' and being able to achieve success, when starting from the bottom and having seemingly insurmountable obstacles, reads something from Hollywood. This does not only happen in fairytales. This happened to Nobu Matsuhisa, who literally ended up in Hollywood. Nobu Matsuhisa has created a restaurant empire. Having started out as a dishwasher in Tokyo, he now has established restaurants in the world's most glamorous cities. New York, London, Dubai, Hong Kong, Milan, Athen, Mykonos, Cape Town, just to name a few. Nobu attracted such interest with his restaurants, that after repeated attempts, Robert De Niro persuaded him to become his business partner. Nobu has become a 'fashion-symbol' and attracts clientele that range from Sports-icons to Movie-stars. Regardless of it's location, it has become the 'in' place to be in every city that boasts it's presence. I find it incredibly inspiring to read about 'rags to riches' stories. They give people from various different backgrounds and foundations, the belief that 'the sky is the limit'. I also feel that when I hear about these stories, it teaches me to be respectful of everyone I meet. Often in society, people working lower status jobs are looked down upon. There are unlikely to be many people that had faith in Nobu Matsuhisa when he was a dishcleaner in Tokyo. There are also unlikely to be many people that envisioned the future that he was destined to achieve. An entrepreneurial genius. In every sense of the word.

How Chef Nobu Built His Sushi Empire

Although I had known several aspects about Nobu's story and entrepreneurial career path, I learned various details from an article by 'CNNMoney'. The article begun with a few short paragraphs giving a brief introduction and this was followed up with an interview with Nobu Matsuhisa. There is no better way to gain an insight into someone's story, then through a printed interview. I was impressed by the questions that the author chose to ask Nobu. She started out by inquiring into his 'early days' and how he 'started out'. This gave the reader a good foundation of knowledge. The style of questions were 'thought-provoking' and gave the interviewer a chance to elaborate on his responses and provide a great amount of detail. An example of this is, 'When did you first know that you wanted to be a sushi chef?'. This differs greatly from a 'yes' or 'no' type question and due to its 'personal nature' is likely to persuade the interviewee to be thorough in his answer. I also felt it was extremely effective how the questions were revised, based on what the interviewee said. This flexible structure, provides for a much more interesting interview. After reading this interview, I must admit that I have a much higher degree of admiration for his accomplishments. I have always felt that it is never enough to simply have 'the talent' in the Business world. You need to possess an overpowering passion and tenacity to succeed.

Nobu Finds A Recipe To Keep The Hunger of Recession At Bay

Another article that I found quite interesting, was an article by 'The Telegraph'. It puts the success of the Nobu franchise into a current context, by looking at how the empire is being affected by the current economic turmoil. I enjoyed reading the article as it maintained a realistic yet optimistic tone. The author mentions how 'the company has yet to lay off any staff during the economic downturn' but maintains a sense of balance as he also confirms that 'it has not all been smooth sailing, as the company closed down in Canary Wharf.'


The article decides to approach the topic from a different angle and perspective to the previous author. In this article, it is not Nobu Matsuhisa that is interviewed, but instead one of Nobu's Managing Partners, Richard Notar. Whilst obviously not as integral as the primary owner, it was interesting to see the opinions of another important stakeholder in the company. I find that the article written by 'The Telegraph' showed more 'narrative flair'. In some ways this is difficult to compare with the article by 'CNNMoney' as that was predominantly an interview, but I was very impressed with the writting style of 'The Telegraph'. The author inter-weaves together facts as well as his own perspective. I have contemplated which of the two articles did I prefer reading. I think that they each have their attributes and it would be unfair to compare 'apples and oranges'. The 'CNNMoney' article was possibly more informative and interesting from the point-of-view that it was conducted with the 'man behind the vision'. However 'The Telegraph' article was very cleverly written and the style of writing of the author was unique and witty. In this sense, they have a 'collective synergy' and would recommend any interested readers to refer to them both.

The author reflects on how the next stage for Nobu's growth is to find prospective partners. The article refers to the final aspects of this strategy as it is reports that, 'Goldman Sachs was hired to find a buyer for 51% of the business - a deal that would have been worth £270 million'. I was shocked when I read these figures. It is absolutely remarkable how someone can go from the status of 'dishwasher in Tokyo' to 'owning a restaurant empire of nearly double £270 million'. The expose always mentions how the company has been considering on 'launching a range of hotels based on the Nobu concept of high quality individual service.' In my opinion, this move could really work. It is reported that plans to open up a hotel in Israel, were put on hold due to the economic recession, but given the right economic time-frame it could really work. Now that Nobu has established a successful brand-name and has become a 'household product' in the eyes of the celebrities, it really has 'the world at it's feet'. If this venture into the hotel industry proves successful, then there are a host of possibilities and methods of attracting this lucrative clientele base.

I chose to review these two articles for one primary reason. In my previous entries, I have tended to focus on two or more sources with very contrasting angles. This was beneficial from the point of view that the reader was able to get an holistic view on the issue and topic. However, in this instance I decided that I wanted to show how two differing articles could 'work together'. I found that it was almost as if each article was 'one half' of the puzzle and needed the other to be complete.

Websites Read:

http://money.cnn.com/2009/03/25/smallbusiness/nobu_fish_story.fsb/index.htm

http://www.telegraph.co.uk/finance/newsbysector/retailandconsumer/5172886/Restaurant-chain-Nobu-finds-a-recipe-to-keep-the-hunger-of-recession-at-bay.html

You May Have Been Mocked In The Past. But Asia, Your Having The Last Laugh.

I have always found it fascinating how perspectives and ideas change over time, especially when these changes lead to role reversals. This is particularly evident with the way the world now views Asia. Before the 'opening of China' and other Asian power-houses, that saw an increasingly open trading environment with the West, there was a great divide between the 'Western mentality' and the 'Eastern mentality'. The mentalities were so contrasting that it was as if they viewed the other as 'aliens from a different planet'. However, slowly but surely, there has been a development in the relationship between these two philosophies. It seems that each side has acknowledged that there are positives to be taken from the opposing side. The 'West' has taken on several aspects such as the experimentation with various herbal health remedies that have supposedly worked better than many technologically advanced health procedures in the 'West'. It has also become 'fashionable' to eat Asian cuisine and in many of Europe's major cities these restaurants are amongst the most expensive and trendy. Yoga has become relatively main-stream and continues to grow in popularity.

There are also many predominantly 'Western' traits that are now being exposed to this up-and-coming Asian market. The 'Luxury Brands' certainly aren't complaining. Gone are the days when it was only Westerners that indulged in luxuries such as fancy sports cars, premium fashion brands and expensive liquors. It is progressively becoming just as likely to see a decadently dressed woman strolling down the streets of Beijing with a 'LV handbag' as it would be in Milan or Paris.

Designer Brands Battle For Slice of Booming Asian Market

During such economically uncertain times, it is in some ways surprising to see many 'Luxury Brands' expanding their presence in new regions. However, it does seem 'just as good a time as any' to take advantage of this lucrative opportunity. An article by 'SouthAsianPost' highlights the importance of this new market to these fashionable heavy-weights. It reveals that, "Major designer brands, including Christian Dior and Gucci, spent more than 60 million dollars on advertising in Hong Kong last year, 23% more than 2006." That is a tremendous increase that is made all the more significant considering that most companies are scaling back on divisions such as advertising. It seems that these companies have 'both eyes' on the region. The article boldly states, "With Asia being the world's biggest market for Western luxury goods, international brands are shifting their focus from Paris, New York and London to the fast-growing emerging markets in the region." This seems a far cry from the days where Westerners would make fun of 'those Asians with the gowns and silk cloths, and the Asians would mock 'those Western big-noses with the silly hats'. Whilst I think overall globalisation is a good thing and there is nothing wrong with cultures merging and taking the benefits from each, it is also important to maintain a sense of identity and tradition and not let these fade away into distant memories. This seems to be a distinct possibility, "The reason why Asians buy so many luxury brands is that in Asia, you are, what you wear. A luxury brand is a symbol that defines who you are and your social status. People judge each other by what brand of handbag they are carrying." It appears that there is now less emphasis on familial values and more on the notoriously superficial ideals of the West.

Whilst I am not surprised that these Asian economies are lucrative new target-markets for these companies, I was slightly taken-aback about how readily it appears that they are willing to neglect their European markets for the Asia. This is was embodied as Vincent Shaw, Chanel's president for Asia Pacific, claimed, "Hong Kong was carefully chosen as the best place to launch the exhibition before it tours other fashion capitals around the world, including London and New York." He continues by explaining the reasons behind this decision, "Asia has a huge population and an incredible liquidity. We believe that there's a huge opportunity and that Asia will be extremely successful." This view is given some credibility by Radha Chadha, author of the 'The Cult of the Luxury Brand', who adds in, "Asian consumers account for more than 50% of the annual 80 billion dollar sector, more than the U.S. and Europe combined." This willingness to try cash in on this market even during unstable times seems to remain true across the board. Louis Vuitton has seen similar opportunities in Asia as it steps up its battle for a bigger slice of the market with the re-opening of its massive store after a year of renovation. The new store is double the size of the previous one and is the company's second largest after its flagship building on the Champs Elysees in Paris.

China seems to be starting to take a leadership role in this rapidly growing movement. It is estimated that the country will overtake Japan as Asia's biggest luxury market within the next 7 years. Louis Vuitton already has 18 stores in the country, with 6 more expected to open this year. Jean-Baptiste Debains, Louis Vuitton's president for Asia Pacific, underlined the company's ambitious plans, "There are a lot of cities in China where we can have stores, maybe not today, but in three years." Such growth potential is not limited to China. The company also plans on opening stores this year in Indonesia, South Korea and Taiwan. Whilst Radha Chadha maintained a sense of caution that due to the economic slowdown in the United States, this was likely to hit the luxury goods consumption, Louis Vuitton's Debains seemed adamant that growth in Asia "was unstoppable". From current reflections, it seems that fortunately for Louis Vuitton and the other premium brands, he seems to be proven right.

Battered Luxury Brands Eye Chinese Market For Growth

An expose by 'ChinaDaily', starts off with the use of a little 'tongue-in cheek', "while people in the developed world tighten their belts and focus on daily necessities, the big luxury companies are looking to China's new rich to buy their jewellery, clothes and bags." This is a slightly exaggerated remark with the use of 'focus on daily necessities'. It makes out as if the whole of the "developed world" is on the bread-line. I think that this illustrates some remnants from the past cultural clashes and the author is taking her opportunity in offering a 'slight dig' at the former adversaries. Being a local journalist, for a Chinese paper, this bias is rather expected. It seems that the sources used were carefully planned out and each quotation appears to have atleast a little hint of nationalistic pride. This can be seen with comments made from Guo Zuli, director of the World Luxury Research Center, whom emphasizes, "The Chinese market shows remarkable resilience in the financial crisis because it has an increasing number of people able and willing to buy luxury goods. Unlike the mature traditional markets, demand in China is far from saturated either materially or psychologically."

The depressing reality of how the economic downturn has affected 'Luxury Brands' is reflected with the use of statistical figures. A study by the consultants at 'Bain and Company' illustrates the severity of the situation, "sales growth in the luxury goods sales were estimated to have slowed significantly to 3% during 2008. The slower growth rate stood in sharp contrast with 6.5% in 2007 and 9% growth in 2006." There appears to be further setbacks this year with Deutsche Bank indicating the market will contract between 5 to 10% in 2009. Similarly to the first article, there seems to be joint argreement that China can provide its 'saving grace'. Experts agree that the Chinese luxury goods market remains "resilient", due to the country's stable economic growth and rising number of rich with a steadily increasing purchasing power. It is estimated that during 2007, 415,000 Chinese had more than $1 million in disposable assets, more than any other country in the world.

The information provided in the first article is verified as 'ChinaDaily' similarly mentions the same luxury brands that are excited by the growth opportunities in China. Gucci is reported to have opened their flagship store in Shanghai during May of this year. Louis Vuitton is also mentioned, with profits estimated to have experienced a growth of 2.1% from 2008's figures. This is in stark contrast from its performance in other markets, "sales in the United States fell 4.03% and in Japan 5.16% last year." These poor financial results were mentioned in jest, as the company chose to focus on its successes in China which reflected, "strong and solid" growth.

The article uses Bain & Company repeatedly to reflect market predictions and reflections. Their consultants estimate that, "the Chinese luxury market would see a growth of 20 to 25% in the next 5 years." The Chinese Ministry of Commerce chimes in proudly, "China will become the world's largest luxury market by 2014, accounting for 23% of global business." I am sincerely shocked at the rapid speed in which the Chinese market has taken to these traditionally Western 'luxury brands'. Whilst I was never in doubt that it was only a matter of time before these luxuries were adopted by the East, I would be very surprised if anyone could have anticipated the tremendous growing demand during such an uncertain economic period.

Whilst I'm sure that the mentioned 'luxury brands' wouldn't agree with me, I feel as though this sudden and drastic 'adoption' of the Western lifestyle is a little unfortunate. The reason I am against this transition, is that it has come at the cost of local customs and traditions. In a growing population where nearly 13% of the people can now afford to buy luxury brands, there is going to be those who consequently suffer. This growth will come at the expense of the local fashion designers and even 'the man on the street selling hand-made bags' whose lively-hood now remains in the balance. After all, as Asia embraces such a superficial mentality, who is going to turn down the latest designer LV bag to help out the local street vendor by buying his?

Websites Read:

http://www.southasianpost.com/portal2/c1ee8c4418e1e94f011905dc070602db_Designer_brands_battle_for_slice_of_booming_Asia_market.do.

http://www.chinadaily.com.cn/bizchina/2009-04/11/content_7669126.htm

Football Is Not Just A Sport. It's A Life-Saver.

Football, or 'Soccer', as the Americans like to refer to it, has had a large impact on my life. There are times when it seems that my calendar revolves around the next set of matches and everything takes second priority. The amount of exhilarating football on offer these days is limitless, from the English Premier League, Italian Serie A or the Spanish Primera Liga to name a few. However there is no bigger stage then the World Cup. It is almost as if the world comes to a halt during this month-long tournament once every 4 years. It was estimated that around 715 million people tuned-in to watch the last World Cup Final between Italy and France. This is more than any other sports event, even more than any Olympics event in history. The tournament is turned into a colorful spectacle as people from all over the world go to support their team dressed in every color of the rainbow. Next year, the privilege of hosting the event is bestowed upon South Africa. Whilst the sporting benefits that comes along with hosting such an event is obvious, the economic and social positives that are presented cannot be understated.

World Cup 2010 Immune To Global Crisis

In an expose by 'Africagoodnews', the great importance and responsibility of hosting such a large event was highlighted from the opening line, "Africa waited decades to host its first soccer World Cup and when it comes, it's during an unprecedented global economic crisis." From first glance, this statement could take on two meanings. It could be beneficial that the tournament comes at a testing time as this would obviously bring investment and revenue into the country. However the situation could also be taken from the view-point that it is detrimental to host the competition during a period when people are less inclined to travel and spend as much during these uncertain times. The author appears to have taken the positive side of things, as he remarks, "not even the worst crisis since the Great Depression seems likely to deter millions of fanatical football fans or big commercial sponsors." This sense of optimism is given some credibility with the inclusion of quotes from the Marketing Manager of FIFA, "We are quite lucky that the recession has not touched FIFA, and in that regard the World Cup. Our sponsors are strong partners. They have suffered under the crisis, but all are clearly behind FIFA and the World Cup". FIFA is a football governing body and handles the organisation of the World Cup, so this positive outlook must be a huge relief to South Africa.

During the article things are still put into perspective. There is no denying that the world's major economies such as the United States and those in Europe which consist of the top footballing nations, have been struggling during the recession. This has affected every sports industry which has had to "counteract dwindling incomes". Colen Garrow, an economist for financial services group Brait, issues a cautionary message whilst trying to be upbeat, "there is a risk that the success could be hindered by the lack of tourist buying power. But by then the global economy will have recovered somewhat and people may feel more confident to spend." I have to agree with this argument. South Africa is fortunate that slowly-but-surely things look like they are recovering and it appears that the worst period is over. Had the World Cup been a year or two earlier, things may have turned out rather sourly.

The USP (Unique Selling Point) that the World Cup possesses is that it is only every 4 years and whilst people may not have the same amount of disposable income as before, there is the acknowledgment that it is a one-off event. The author of the article points this out, "The World Cup may just be the tonic that helps not just South Africa but its neighbors get through the economic downturn." Rightfully so, other countries in Africa are taking full advantage of this period of increased exposure for the continent. Mozambique has encouraged its private sectors to build more tourist hotels and countries like Botswana and Zimbabwe are hoping to attract teams and fans for practice matches. In my opinion, the World Cup could turn out to be a 'life-saver' to many countries in Africa. A country like Zimbabwe which has really struggled economically in recent times with its unprecedented inflation, needs to take full advantage of any opportunities that presents itself with the World Cup. The consultancy division of Nomura International has estimated that "the World Cup will add about 0.6% to 0.7% to South Africa's economic growth in 2010. This has occurred as a result of "the country pouring billions of dollars into infrastructure spending, leaving construction as virtually the only industrial sector left standing in the recession." This illustrates the impact that the sporting tournament can have on an economy. It has the power to enhance the performance of various sectors and industries within the local economy for a tournament that lasts no longer then a month.

Hopes Are High Africa's First World Cup Will Bring Tourists And Financial Benefits

There seems to be a universal agreement about the potential benefits that the World Cup can bring to South Africa and the continent in general. In an article written by 'GlobalPost', Nicolas Brulliard reinforces the honor and prestige presented in hosting the world's largest sporting event to a country that "less than 20 years ago was excluded from most international competitions because of sanctions against the apartheid regime." The inclusion of this point truly exemplifies the progress that South Africa has achieved in a short time period after overcoming one of the most repressive social systems in history and it has certainly improved its global image.

Like the first article, there is similarly the addition of a sense of caution. It notes that "the World Cup will be an immense logistical challenge for the country, which despite having the continent's largest economy, is plagued by a chronic skills shortage, widespread poverty and one of the world's highest crime rates." This is one of the fears looming over those responsible for hosting the tournament. Having been born in South Africa and having chosen to leave due to the escalating crime, I can personally testify first-hand at the destructive nature that this enormous social problem can have. I believe that its impact during the tournament will either be black or white. Either there will be no major issues and the tourists get to enjoy the competition in a relatively care-free environment, or it will be a major issue and could potentially spoil a magnificient event.

The 'GlobalPost' similarly highlights the vast array of benefits that South Africa has encountered due to the event. It is approximated that around "400,000 jobs have already been created, which is significant in a country that has an unemployment rate of 23.5%." The impact on the tourist industry is also considerable with "local organisers expecting around 450,000 overseas visitors and an economic benefit that could reach $7 billion." The article is concluded with a message that I thought was succinct but sweet in nature. "The elections of 1994 really changed the way the world thought of South Africa. Effectively, 2010 has the opportunity to take it to the next level."

The World Cup has presented Africa with a great opportunity to showcase its beauty and potential in front of the eyes of the world. The importance of putting on a show in a relaxed and friendly environment and not letting the social and economic problems that grip the continent get in the way, is paramount. I personally believe South Africa has the potential to put on the best World Cup the world has ever seen by some distance. However, having the potential counts for nothing unless it is realised. Fingers crossed South Africa.



Websites Read:

http://www.africagoodnews.com/2010-fifa-world-cup/world-cup-2010-seen-immune-to-global-crisis.html

http://www.globalpost.com/dispatch/south-africa/090610/one-year-hosting-world-cup-south-africa-looks-at-soccer-tournament

Venturing Into China. Tasty Proposition, But Could It Be The Forbidden Fruit?

There is no denying it. In recent years China has been the location of choice, for many MNC's to establish themselves. It doesn't take much probing to see why. Companies benefit from cheaper labor rates, land, raw materials, tax benefits and the ability to gain access to a large up-and-coming consumer market. However the picture is not always as rosy as it is made out to be. There are many hidden pitfalls that lurk underneath the glossy surface.

Apple has established itself as a company that has become synonymous with success. It seems that in China, it has met it's match. The iPhone which has had revolutionary success in the United States and in Europe, has started its pursuit of trying to crack the Chinese market. This is proving to be a hard nut to crack. There are several issues that the iPhone faces: the threat from the large counterfeit industry which produces 'knock-off iPhones', the extremely strong bargaining power of the dominant mobile phone carriers as well as service limitations.

More Battles Ahead For IPhone in China

An article by 'PCWorld' reflects upon the 'trials and tribulations' that Apple are facing in China. The company's predicament is illustrated from the beginning of the article as although Apple has "emerged from winding negotiations with an iPhone deal in China", there will still be the ongoing issues of "government pitfalls and look-alike competitors in the country". After protracted negotiations Apple has finally managed to secure a deal with the local carrier Unicom. Amidst the cautionary rhetoric in the article, there is the admission that this deal "launches Apple into a huge market where its products have a following among fashion-conscious urbanites." From the outside this seems to be an extremely promising opportunity for the company as whilst China has nearly '700 million mobile subscribers', Unicom had 141 million subscribers at the end of July. These figures represent a large market share and appears to have all the right ingredients to create a lasting synergy between the local carrier and Apple. However this optimistic sentiment does not carry throughout the article.

In order to gain some credibility, the author quotes an analyst at Daiwa Securities who expects that "2 million iPhones will be sold in China each year, not far above the number sold in other countries". Apple currently sells approximately 30 million iPhones per year worldwide. If these sales expectations are accurate then this does not appear to be as lucrative an opportunity as once imagined. Another negative pitfall that needs to be accounted for is the threat of the 'black market' and competition from 'imitation handsets'. This is a more prevalent threat in China than most other countries and is a risk that cannot be ignored. With regards to the level of service provided there is another obstacle. The Chinese iPhone will "not be able to access Wi-Fi, a function China banned on mobile phones until this year and now only allows on certain handsets". In my opinion, this is a significant draw-back as a company like Apple should persevere to ensure that they offer their clients the same quality of service worldwide. Without this key feature, this ambition would not be realized.

There is a 'conflict of interest' problem on the horizon between Apple and Unicom. In order for customers to purchase songs or applications on the iPhone they have to use the App Store service of iTunes. However there are fears within Unicom that this would "draw users away from the carrier's own value-added services". This conflict of interest is not the only obstacle. There could also be problems related with billing, as Apple would require "a government license to accept download payments through Unicom."

After reading this extract, I wasn't too sure the future would be as bright for Apple in China as I'd first thought. However I was skeptical of cementing these sentiments until I had further evidence. Would this article prove to be filled with unrealistic pessimism? Or would it turn out to be a prophetic vision?

Apple and Its Iphone Get Fleeced in China, But Will Google Fare Any Better?

The second article I read on this issue not only confirmed what I had seen before, but it nailed the point home. You can tell how badly something has turned out, when it becomes a reference to failure. 'Venturebeat' pulls no punches in its reflection on the iPhones success in China. Although there is the acceptance at the start of the extract that, "China is the largest market in the world, it's consistently the fastest growing economy and there is a lot of money to be made there", there is also the illustration of the success at which "local entrepreneurs have found ways to fleece American companies bare". Like the first article there is the mentioned deal with Unicom, but describes it as "a pretty depressing deal".

'Venturebeat' refers to the 'black market' issue that the iPhone faces but puts emphasis not so much on the problems with competition but with reference to "creating confusion and dangerous brand dilution". This could occur in the event that a person in China buys the imitation and "gets turned off by phones that don't work, and may not buy the real thing when it does hit the market". The counterfeit industry is clearly a growing problem in areas like China and this can only work in creating greater obstacles and problems for MNC's like Apple.

Similarly to the 'PCWorld' extract, the 'Venture Beat' article mentions that with Apple's deal with Unicom, the company will gain access to 140 million subscribers. However it continues to mention, rather cheekily, that this pales in comparison to China Mobile's 600 million subscribers and 70% market share. This is proof that certain facts can be manipulated to push forth a certain view. One article could mention how Apple has done well in gaining access to 140 million viewers, another could use this as a negative aspect and say that they wouldn't be able to rival China Mobile's dominance.

Ultimately one can make out that China is becoming a little bit of a conundrum for large MNC's. There are many pitfalls and obstacles along the way when a country decides to enter China. However I still believe that this shouldn't dissuade these companies from entering. It should instead make them more aware that whilst they are entering a large market, they are entering a 'different market'. I feel the key to success in China is not trying to force a certain product upon the locals because this will never work. The key ingredient is to discover what the local consumer there wants. If a company manages to find the right mix between maintaining its traditional product and service yet catering to the local market and their requirements, then the sky really is the limit.

Websites Read:

http://venturebeat.com/2009/08/16/apple-and-its-iphone-get-fleeced-in-china-but-will-google-fare-any-better/

http://www.pcworld.com/businesscenter/article/171132/more_battles_ahead_for_iphone_in_china.html

No Singapore Is Not A Village In China.....

Having first moved to Singapore during the beginning of 1992, I have experienced first-hand the incredible growth that this city-state has encountered during the last couple of decades. The country has progressed leaps-and-bounds which is made all the more impressive considering it only achieved a position of independence as recently as 1965. Singapore is now considered as one of the leading financial centres in the world and an Asian economic power-house alongside Tokyo and Hong Kong.

The one thing that has frequently irked me during periods that I spend away from Singapore is the lack of knowledge and recognition that many people around the world afford to the country. I have countless memories about questions that people have asked, when they find out that I am based there. "Singapore? That's a city in China right?", "Really? But your not Chinese are you?", "Is that the capital? Oh.... or is it Beijing?" These are a few examples of the slighly more intelligent reponses that I've heard. In order to preserve the dignity or lackthereof of the responsible few, I won't post the rest. Therefore I have decided to reflect upon a few articles that I have read recently about the economic growth within the country. Hopefully this will provide a 'baby-step' in enhancing the country's visibility as well as minimising the irksome responses that I will have to encounter.

Whilst Singapore has become synonymous for it's strict governmental policies and has even earned the nickname of 'Fine City', there has been an easing of such restrictions to continue the country's rapidly growing economy. This has triggered large investment into the country with the construction of casinos, trendy restaurants and night-spots as well as theme parks. This was a necessary step in order for the government to succeed in its ambitious plans of making Singapore the number one financial and entertainment hub in Asia.

Lift on Singapore's Casino Ban To Encourage Economic Growth

An article published by 'AllBusiness' reflects how during 2005, the government legalized casino gambling in an attempt to further boost the economy. Similarly to the United States, Singapore has suffered from the growth of China and India as this has led to lost manufacturing jobs. The article reports the views of a consultancy expert who reflected, "This is really a bold move by a governement that has traditionally been conservative. Projections are that the GDP will grow by 1% just because of the casinos and 100,000 jobs will result from construction".

The expose from 'AllBusiness' is a rather brief extract but succeeds in presenting an interesting topic with enough information and analysis to be a credible source. The style of writing is 'informative' and although there is the inclusion of several quotes, there does not seem to be any bias towards one perspective or another.

Singapore's Growth Beats Estimates on Construction

An extract from 'Bloomberg' reported the rapid rate of expansion of the Singaporean economy. The opening line of the article was succinct, "Singapore's economy expanded 7.6% in the first quarter amid a boom in construction, exceeding all forecasts and increasing the likelihood that growth this year can withstand a U.S. slowdown."

'Bloomberg' highlighted the impact of the new casinos, as "builders broke ground on a $3.3 billion casino-resort last quarter, helping spur the fastest construction rate in nine years." It seems that the construction was not the only sector that was prospering as financial heavy-weights, "Merrill Lynch and Morgan Stanley are among businesses expanding operations, as the government cuts corporate taxes to lure international financial services companies and reduce the economy's dependence on manufacturing."

The article uses the inclusion of quotations of an economist at Standard Chartered Bank in Singapore to add some financial expertise to the equation. "The domestic growth story is extremely strong at this point in time, driven primarily by real estate as well as equities." When an expert gives his own perspectives on a given subject, this works to persuade the average reader that the results being presented can be verified by a specialist in the field.

Whilst there is no disputing that the world in general is dependent on the stability of the U.S. economy, it is a testament to Singapore's progress that they are far less reliant, which is a luxury that few countries in the world could claim. Their ambition of becoming a central hub in Asia seems to be gather pace. This is exemplified as, "Merrill Lynch is building an office block that will house 900 employees when it opens at the end of next year, making Singapore its largest center in Asia. Morgan Stanley will open a prime brokerage office this year to be closer to its hedge-fund clients". The introduction of companies with such a great prestige can not be undermined as this brings in foreign-investment and higher net-worth individuals. As the article correctly states, "this spills over to the rest of the economy."

The Paradox of Singapore's Economic Growth: Time and Income

After having looked over numerous articles reflecting up Singapore's successes and fascinating growth rate, I felt that the only way to present a balanced arguement, would be to uncover some of the negative aspects that can be attributed to such growth. I came across an article by 'The Temasek Review', which is a platform where news and opinions are presented from an 'independent perspective'. There are some captivating points highlighted and reflects upon 'the other side of the coin'.

The review starts off by mentioning how, "In a typical economic growth model, the assumption is that an economy that grows from a low income to a higher income suggests that the economic growth will bring along positive growth with regards to 'real incomes' and 'leisure time'." This means that due to the population earning a higher income, they should be able to possess a great level of 'purchasing power' as well as have the freedom to spend more time doing the things that they enjoy, as a result of a greater level of efficiency in work and technological improvements. The author points to the fact that this is not the case in Singapore. Whilst "an average income in Singapore in 2008 was 42 times more than that in 1960", there are still "fewer people calling their incomes as comfortable or sufficient". This perspective is hammered home with various arguements that suggests that Singaporean workers are being overworked with 'increased working hours', 'greater pressure to have two-workers in a family unit' and 'incomes unable to compete with rising costs'.

I have to admit that whilst I give credit to the perspectives put forth, I feel the article was written with an excessive amount of venom that prevented me from taking everything being said too seriously. Whilst the article was well presented, it would have given itself more justice if it had presented a countering arguement. In my perspective, it was obviously written by a local Singaporean who had experienced the influx of foreigners into the country and felt aggrieved by the inability to match their lifestyle. It is hard to determine what type of living standard is 'sufficient' and primarily depends on the expectations of the individual. One must sympathise with the locals as it is justifiable that many are maybe not given the same opportunities as a 'foreign skilled worker', but I have witnessed first-hand that the government has several measures in place to maintain and improve the quality of 'government housing' that the Singaporeans benefit from, which is significantly more cost-efficient and to a higher standard than most countries around the world are able to provide. It is important for the country as a whole to accept the fast-paced changes and embrace this level of growth, rarely seen in other parts of the world.



Websites Read:
http://www.bloomberg.com/apps/news?pid=20601068&sid=aUvv19DCPWVA&refer=economy

http://www.allbusiness.com/operations/facilities-commercial-real-estate/4423440-1.html

http://www.temasekreview.com/2009/09/23/the-paradox-of-singapore%E2%80%99s-economic-growth-time-income/

The Heat May Have Been Turned Down. But Still.... There Is Smoke Whenever There Is Fire.

Having just returned from a month long stay in Cuba, I've come to realise that if any country had the merit of being labeled 'news worthy', Cuba would be it. Unlike most destinations in the world, Cuba has no comparisons. It is just as much controversial as it is conflicted and despite all its trials and tribulations, the country maintains its colorful and rhythmic beat that pushes its people forward in the midst of a situation that few would envy.














One would find it rather difficult to talk about Cuba and the situation that is present within the country without mentioning the 'Trade Embargo' and the historically strained relationship that exists with the United States.

When first glancing over articles that have been written about the recent ties between Cuba and the United States, one wouldn't be blamed for having a slightly more optimistic outlook on the strengthening relationship. However having digged a little deeper, it seems rather premature to 'pop open the champagne' and rejoice at this 'new-found friendship'. Whilst it is undeniable that there has been vast improvements and substantially less tension between the two, seen during the 'Bush Era', there remains plenty to be done. The primary articles that I reviewed was one from the BBC, another from the 'New York Times' and a third from 'CNN'.

I felt compelled to investigate this matter as having spent a considerable amount of time there, I know that although one must respect Cuba for sustaining itself without the help of the outside world and its numerous attempts at reaching a level of 'self-sufficiency', the country would greatly benefit from the removal of the 'Embargo' as this would begin to stablise its economic situation and allow the country to start developing 'mutually beneficial' trade-relations with various countries around the world.

Obama Eases Cuba Travel Restrictions

The first article viewed was a publication by 'CNN'. The author takes a strong position of bias towards the current American administration. Throughout the entire article there is spurts of rhetoric against Cuba's political system and casts the view that the United States is the 'peace-maker' against the evil protagonist. This is illustrated with the inclusion of quotes from a Republican Senator who claimed that, "Raul Castro's dictatorship is one of the most brutal in the world. The U.S. economic embargo must remain in place until tyranny gives way to freedom and democracy." Another Republican senator allegedly was quoted as saying, "Over the past 50 years, the Castros and their secret police have been directly responsible for killing thousands of nonviolent, courageous pro-democracy activists and for jailing and torturing tens of thousands of others. And they continue to this day to perpetrate their brutal crimes". In the midst of these hard-lined quotes against the Cuban government, there was the inclusion of steps Obama had taken towards improving relations and went as far as suggesting, "Obama has a historic opportunity not to be the last president of the Cold War but the first president to turn the page in the US-Cuban relations".

Obama Opens Door To Cuba, But Only A Crack

In an article written by 'The New York Times', there seemed to be the acknowledgement that Obama was achieving progress in his ambitions at strengthening relations with Cuba, albeit 'only by a crack' and not as much as was first anticipated. The criticism towards Obama over the slower-than-expected nature of the progress visibly seen has to be put into perspective as the political conflict with Cuba is deep-rooted and it's important for any new president not to try 'step on any toes' so early into his campaign. The article mentions that "whilst he did not lift the trade embargo with Cuba, he is using his executive power to repeal Mr Bush's tight restrictions so that Cuban-Americans can now visit Cuba as frequently as they like and send as much money as they want, as long as the recipients are not Communist Party officials".

The article continues by emphasising how Mr. Obama is encouraging "telecommunications companies to pursue licensing agreements in Cuba, in an attempt to open up communications there by increasing access to cellphones and satellite television." This illustrates how the United States is beginning to change their mindset about Cuba. Instead of viewing them as the 'evil neighbour', they are beginning to work out how they could benefit from the 'opening up' of the country. Some may be critical of this approach and continue on their rants about the US playing the role of the 'imperialists' of the world and doing everything for their own political and financial gain but let's be honest here, which country doesn't look at how they can manipulate a given situation for their own personal gain?

Out of the three articles, I enjoyed the way 'The New York Times' article was written. It seemed to possess a diverse range of qualities. It had an optimistic tone, yet also put forth a cautionary message that whilst changes were being accomplished, it was important not to believe all 'the hype'.

'No Change' from Obama, Says Cuba

The 'BBC News' article was by far the most critical of the progress being made. The tone and direction of the article was established from the first line. "Earlier this week, Mr Obama renewed the embargo for another year". Short and sweet, direct to the point. The Cuban foreign minister, Bruno Rodriguez, was quoted as saying that "the Trade Embargo had cost Cuba $96 billion since 1962". Whilst Mr Rodriguez acknowledged that the easing of restrictions for Cuban-Americans to travel back home and the amount of money allowed to be sent back had been "positive" they had nothing to do with the embargo. The foreign minister then continued by declaring that whilst Cuba hoped for direct talks they would "not discuss its internal affairs with anyone, not with the US nor with any group of countries".

Having read the other articles, this put a dampener on any optimistic sentiments that lingered. If the US was only willing to consider talks with Cuba on the premise that they would work towards implementing a more democratic society and improve it's human rights record, and Cuba was only willing to consider talks without the mentioning of how they conduct 'their internal affairs', then what hope remains?




Websites Read:
http://news.bbc.co.uk/1/hi/8260104.stm

http://www.nytimes.com/2009/04/14/world/americas/14cuba.html

http://www.cnn.com/2009/POLITICS/04/13/cuba.travel/

Size Matters.

Recently there has been a widely-disputed debate about whether the global economy is still in the midst of a recession or if we have already seen the worst of the storm. Like anything, it depends who you ask. A key fundamental behind a market economy, is the feelings and confidence of consumers. The hype surrounding the easing of the recession, is likely to be a combination of truth mixed with a sense of hope.

UK economy is 'still not growing'

An article published on the BBC News website, illustrated how "contrary to expectations, the UK economy did not grow in the third quarter of the year" and this could be attributed to a "failure in registering growth in weak industrial activity". The article was written primarily from an unbiased viewpoint and gave little away in terms of the writers opinion. Instead the focus was fundamentally facts and quotes giving credit to the opinion of the 'Chief Secretary to the Treasury' amongst others. The article uses two primary sources to reflect the evidence presented. The first source mentioned is the 'National Institute of Economic and Social Research' or NIESR. The second source that is referenced is the 'Office for National Statistics' or ONS. Whilst these seem to be fairly reputable sources, I would have enjoyed reading the article more had their been not necessarily 'author bias' but atleast some sort of opinion or perspective on the facts and information that was being presented.

The NIESR calculated that from July to September 2009 there was an unchanged GDP within the UK. This didn't correspond to economist predictions that there would be a level of growth that would effectively signal the end of the recession in the UK. The NIESR went a step further by commenting that "predictions were less likely to be accurate than usual because of the current disturbed economic circumstances". These reports add further speculation as to when the UK economy will follow France, Germany and Japan out of the recession. To further portray this cautionary viewpoint, the article mentions how the ONS announced on the 6th October 2009, that the UK's industrial output had unexpectedly fallen 2.5% during the month of August from the previous few months. This information is relevant as "GDP figures are given prominence as a recession is generally shown by two consecutive quarters when the economic output is contracting".

UK Economy Already Out of Recession

There are however reports that attempt to portray a rather 'brighter' picture of the current economic situation. 'FinFacts' is a website that reveals global financial news. From the articles that I reviewed on the website, it seems to be the sort of media outlet which tries to impress with the use of large quotations, numerous statistics and complicated looking graphs.
The start of the article begins in a brash and convincing fashion, "UK consumer confidence rose to the highest level in more than a year in August as evidence mounts that the economy is emerging from the worst recession in a generation". The main source used in the article is the 'Nationwide Building Society'. To further emphasise this positive sentiment the source highlights a quote in italics from a senior offical, the Nationwide's 'Chief Economist':

"The moderate increase in confidence this month indicates that, for the first time since April, consumers are beginning to feel more positive, not only about the future, but also about the present situation. The rise in positive sentiment across all indices is no surprise as a number of key economic indicators continue to show that we may have reached the bottom of the current recessionary cycle".

I was rather sceptical when I read this article as it seems as though there is an underlying motive behind it's publication and didn't seem to possess a level of objectivity. In my opinion, the article seems to target investors or industry-related professionals as it constantly attempts to persuade and re-assure it's readers that things aren't as bad as they seem. With this in mind, I was not as receptive to the information presented as I was in the first article.

There appears to be a lack of cohesion or synergy between the information presented in the first and second article. In the first article, it clearly states that "GDP remained unchanged from July to September". However in the second article, it mentions that "the UK economy returned to growth in the three months ending August as it rose 0.2%, following a 0.3% decline in the three months to July". What was interesting was that both sources quoted statistics from the NIESR.

In order to get an objective and coherent indication on the validity of these sets of information, it would be most beneficial for the reader of these articles to use a third source and determine which is closer to the truth.


Websites Read:
http://news.bbc.co.uk/1/hi/business/8292958.stm

http://www.finfacts.com/irishfinancenews/article_1017849.shtml