News from the globe impacting our world.
World Bank Chief Warns of Global Food Inflation. World Bank President Robert Zoellick on Thursday warned of rising food inflation and high oil prices risks to world growth, as they threaten to push more people into poverty. "We are at a tipping point in terms of food prices," Zoellick said in a press conference at the opening of the spring meetings of the World Bank and the International Monetary Fund here. Zoellick also cited high sovereign debts in advanced countries as another risk to the world's economic outlook. Zoellick urged the Group of 20 industrialized and emerging nations, which is gathering on the sidelines of the IMF and World Bank meetings, to work on ways to limit food price volatility.
Chinese Inflation Rising. Data released Friday showed that Chinese consumer prices rose 5.4 percent over a year ago, driven by surging food costs. That's up from February's 4.9 percent increase and was a setback for communist leaders who have boosted interest rates four times since October and taken other steps to cool prices. Chinese inflation is now at a thirty-three month high. The country’s gross domestic product rose 9.7 percent from a year earlier in the first quarter, data released Friday by the National Bureau of Statistics show, down marginally from the 9.8 percent expansion reported in the fourth quarter of 2010. More reaction from the Wall Street Journal.
Meanwhile, Dr. Vikram Mansharamani of Yale University warns in the Asia Sentinel of a bubble economy developing in China.
From a macroeconomic perspective, most asset bubbles are associated with "easy" or cheap money that drives overinvestment and overconsumption. Evidence of such easy money can be found in Chinese commercial real estate, where both entire cities – like Kangbashi, in Inner Mongolia – as well as gigantic malls remain virtually empty. Time magazine profiled Kangbashi as a modern "ghost town," and foreign newspapers have referred to the South China Mall in Dongguan as the "mall of misfortune." Despite a 95-plus percent vacancy rate six years into its opening, the solution proposed by the mall's management is as disturbing as its existence: an expansion of approximately 200,000 square meters.
An Army Mutiny in Burkina Faso. Blaise Compaore, president of Burkina Faso, has reportedly fled Ouagadougou as a mutiny among his military bodyguards spread through barracks at the presidential compound and other army bases. Burkina Faso has recently been hit by unrest. On April 8, people took to the streets of Ouagadougou to protest soaring prices of basic foods. In March, students torched government buildings in several cities after a young man's death in custody. More from Al Jazeera.
Opposition Leader Shot in Uganda as Army Moves to Quell Protests. Days after arresting three prominent opposition leaders, Uganda’s opposition leader Kizza Besigye was shot in the arm as soldiers moved to quell riots over high living costs. It was the second day of a walk-to-work protest to symbolise the hardship encountered by Ugandans in paying for transport costs. Uganda People’s Defence Force soldiers took over from the police to crush the demonstration. More from All Africa.
GOP Invites Israeli PM to Speak. The Israeli daily Haaretz is reporting that Prime Minister Benjamin Netanyahu will give a Mideast peace policy speech in front of U.S. Congress in late May. The office of U.S. House Speaker John Boehner confirmed the report, saying Boehner's will invite Netanyahu to address a joint meeting of the U.S. Congress during a visit to Washington next month. When did Boehner become Secretary of State?
Irish Credit Downgrade. Moody's downgrades Irish sovereign debt rating two grades to Baa3 and warns of more austerity measures as euro value falls. The story in The Guardian.
Robert Fisk on The Arab Awakening. Noted journalist and Middle East expert Robert Fisk writes in The Independent on the roiling Arab protests of 2011. He notes that "the "Arab awakening" began not in Tunisia this year, but in Lebanon in 2005 when, appalled by the assassination of ex-prime minister Rafiq Hariri, hundreds of thousands of Lebanese of all faiths gathered in central Beirut to demand the withdrawal of Syria's 20,000 soldiers in the country."
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