"MyDD" - 3 new articles
Finns went to the polls on Sunday to elect a new Parliament. The right-wing National Coalition won 20.4 percent of the vote while the left of center Social Democratic Party won 19.1 percent. However, the seats of both the parties shrank in the Parliament, with National Coalition retaining 44 of its previous 50 and Socialists holding on to 42 out of 45. The Centre Party - previously the largest party in parliament - won just 35 seats, down 16 from the last election in 2007. The big winner was the far right nationalist party, the True Finns (Perussuomalaiset in Finnish) which finished in third place with 19 percent of the vote and 39 seats in the 200 seat chamber.
Still, the conservative National Coalition's leader, outgoing Finance Minister Jyrki Katainen, is however almost certain to take the prime minister's office and form a government, as his party rose for the first time in history to become the largest in parliament with 44 seats.The balance of the seats were distributed among the Left Alliance which won 14 parliamentary seats, the Green League with 10, the Swedish People's Party with 9, and the Christian Democratic League with 6.
Voter turnout was 70.4 percent, marginally higher than 67.9 percent that voted in 2007.
More from the BBC.
News from around the globe impacting our world.
Japan Nuclear Crisis to Last Nine Months. The operator of Japan's crippled Fukushima Daiichi nuclear plant says it expects to bring the plant to "cold shutdown" by the end of the year. The story from the BBC.
Cuba to Introduce Wide Reforms. Speaking at the start he first congress of Cuba's ruling Communist Party in 14 years, Cuban President Raúl Castro is calling for wide political and economic reforms. Castro said top political positions should be limited to two five-year terms, and promised "systematic rejuvenation" of the government. In terms of economic reforms, free education and healthcare would still be guaranteed, but mass subsidies of basic goods would be removed and social spending would be "rationalized". More from the BBC.
Early Returns in Nigeria Favor Incumbent. Goodluck Jonathan, the incumbent president leads in Christian south while his main rival, Muhammu Buhari, is ahead in Muslim north as counting is under way. Full coverage from All Africa
World Bank President Warns of Crisis. Robert Zoellick, the President of the World Bank, is warning that the world is "one shock away from a full-blown crisis." In particular, Zoellick is worried that rising food prices pose the main threat to poor nations who risk "losing a generation". The story from the BBC.
A Hong Kong Bubble? The Asia Sentinel looks at the real estate market in Hong Kong. Hong Kong likes to lay the blame for its escalating property prices on the influx of mainland money, particularly into high-end apartments. However the latest evidence from the HK Monetary Authority suggests that Hong Kong is doing much to help the process along. Meanwhile the territory's lending institutions are helping mainland firms avoid the rather modest efforts that China has been making to rein in credit growth.
Finns Voting in Crucial Parliamentary Elections. Finns are voting today in elections that may have a deep impact on the sovereign debt crisis in Eurozone countries and for the future of the euro itself. Finland has a unicameral Parliament with 200 seats and all seats are being contested. These elections, against the backdrop of the ongoing Irish and Portuguese debt crises, have seen the rise of right wing populism in the Nordic country. The polls show that the True Finns party, led by Timo Soini, stand to gain close to 20 percent of the vote in Sunday's elections on an anti-Islam, anti-Europe platform. Der Spiegel has a preview of the Finnish elections and what's at stake in this one of the most pro-Europe countries in the EU. I'll have a wrap-up later once results are in.
On Thursday in the coastal city of Sanya on China's Hainan island, Brazil, Russia, India, China and now joined by South Africa for the first time - the BRICS group of global emergent economies - met in their third annual summit. These economies represent 40 percent of the world's population and 20 percent of the global Gross Domestic Product (GDP). More importantly, these economies are growing over six percent per annum compared to negligible growth in the world's most advanced industrial economies.
At their first meeting in Brazil two years ago, the BRIC economies accounted for just over 15 percent of global GDP. By 2016, the International Monetary Fund predicts the GDP of the four largest - Brazil, Russia, India, China - will total $2.1 trillion collectively out-stripping the US economy. The BRICS group also hold 40 percent of the world's currency reserves, the majority of which is still in US dollars.
While summit dealt with a whole range of issues from Libya to climate change, the primary focus was to forge ever closer financial and trade ties. To that end, the BRICS each represented by their head of governments - Indian Prime Minister Manmohan Singh, China's Hu Jintao, Brazil's Dilma Rousseff, Russia's Dmitry Medvedev and South Africa's Jacob Zuma - signed an agreement to use their own currencies instead of the predominant US dollar in issuing credit or grants to each other. Full text of the Sanya Declaration is available from China's Xinhua Net news service.
"Our designated banks have signed a framework agreement on financial cooperation which envisages grant of credit in local currencies and cooperation in capital markets and other financial services," Manmohan Singh told reporters at a news conference with other BRICS leaders.
While the agreement is confined to credit and not trade, it is only a matter of time before trade is settled in non-dollar denominated currencies. Take Sino-Brazilian trade. Brazil’s imports from China have gone from $1.2 billion in 2000, to $5.3 billion in 2005, to $25.5 billion in 2010 - mostly Chinese manufactured good such as cell phones and televisions. Brazilian exports to China have gone from $1 billion in 2000, to $6.8 billion in 2005, to $30.7 billion in 2010. Over 80 percent of Brazilian exports to China are one of three things: iron, soy, or oil.
While Indian Prime Minister Singh, Russian President Medvedev and South African President Jacob Zuma all headed home or went on to other destinations, Brazilian President Dilma Rousseff is spending five more days in China this week to concentrate on trade talks. As Al Jazeera notes there is concern in Brazil if exporting iron and soy (which is major cause of Amazon deforestation) to China while importing billions of dollars in low-cost Chinese manufactured goods (that would be putting Brazilians out of work) is really the kind of healthy trade relationship Brazil wants with China.
From the Brazilian point of view, there is an increasing worry that Brazil is being pigeonholed as just another commodity supplier to China. The proportion of raw materials within Brazilian exports has grown from 29 percent in 2002 to 41 percent in 2009. Furthermore, Brazil’s manufacturing sector is suffering from Chinese competition. While Brazil does run an overall trade surplus, the country which had been used to running a deficit in manufacturing goods of several hundred million dollars a year has now seen that gap grow to $23.5 billion dollars in 2010. Brazilian imports of Chinese manufacturing goods reportedly lost 70,000 Brazilian jobs in 2010, and a slower GDP growth is forecast in 2011 partly due to Chinese manufactured goods replacing Brazilian domestic goods. In sum, more than 80 percent of Brazilian manufactured exports are being adversely affected. Coupled with China’s undervaluing of the yuan, occurring alongside the sharp appreciation of Brazil’s real, has put Brazilian goods at a massive disadvantage in terms of price.
The Economist Intelligence Unit reports:
Accompanied by a large contingent of Brazilian businessmen and officials, President Rousseff was clear in her message to her Chinese hosts: she wants a “qualitative jump” in what Brazil sells to the Asian powerhouse, with a major increase in value-added and processed goods. The government also wants Chinese investment in Brazil to be more diversified, to include not just extractive industries but also high-tech manufacturing.
There is a major caveat that must be noted, there is reason for concern that the Chinese economy may be in danger of overheating. Numerous economists are already warning of Chinese bubble in real estate and infrastructure. Should China's economy catch cold, much of the emerging market economies that are commodity exporters to China will simply buckle under.
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