freedom (or bread)

<P>Two interesting things crossed my desk this week, both dealing with the growing global economy. One of the reports looks from the bottom up, and one from the top down. I am talking about the Hertige Foundation's <a href="">2007 Index of Economic Freedom</a>, and the Economist Intelligence Unit's <a href="">CEO Briefing: Corporate Priorities for 2007 and beyond</a>.
<P>Heritage produced a system with some new methodologies this year, and created a baseline percentage for each country to be graded by (previously they had only awarded a 1 to 5 rating). The rankings are <a href="">here</a>, and certainly raise some eyebrows. Hong Kong is #1; Singapore, perceived as not so free by the media, is ranked #2; the USA follows at #4. The Russians who congregated to talk about the report together on Wednesday night certainly were not amused at Russia's standing at #120, since they were behind Georgia(#35), Estonia(#12), Moldova(#81), and even the Kyrgyz Republic(#79), but more interesting than that were India's standings at #104 and China at #119.
<P>The reason for China's low dip, and Russia's low standing as well, was explained to me as a product of the inefficient IP laws and piracy in those markets; Russia's $1 billion estimated pirate market and China's $5 billion market heavily affected the ratings. Corruption was another problem; both entries were cross-referenced with <a href="">Transparency International's</a> own <a href="">set of rankings</a>.
<P>The EIU report, instead of being generated by overall economic reports from each country, compiled surveys from CEOs, CFOs and other international decisionmakers. Their opinion of India and China was hmm, more bullish:
<P><code>Six out of ten respondents (60%) believe the
region offers the greatest sourcing opportunities,
followed by central and eastern Europe with 15%.
Businesses are putting their money where their mouth
is. The largest share (43%) of respondents will pump
most new investment into Asia, with western Europe,
eastern Europe and North America all lagging well
<P><code>The Economist Intelligence Unit predicts that
growth in the economies of Asia and Australasia
(excluding Japan) will average 6.3% between 2007
and 2011. China and India lead the way with dramatic
growth rates of 9.6% and 7.6% in 2007, respectively.</code>
<P>In short, both documents are happy with economic growth, but the Heritage report certainly gives us a capsule report of overall economic indicators (bottom-up), while the EIU report shows us the point of view from major industry leaders (top-down, or 'boardroom-down', if you want). However, what these industry leaders decide to do in the marketplace will probably affect everyone more in the future.

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