Post on 22-Mar-2016
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Al Jazeera English
ContentsPage 2 - Opinion
Page 3 - General AssemblyPage 4 - Economic and Social
CouncilPage 5 - Security Council
Page 6 - The team behind theScenes
Page 7 - Photographs
Head of International Press
Twesh Mishra
Creative Editor
Paritosh Anand
USG International Press
Shivani Bazaz
Reporters
Amlan Das
Priyanshi Chauhan
Palak Nayyar
Photographers
Aman Agrawal
Ankit Kumar Srivastava
2Opinion
Eurozone Crisis Unveiled
Priyanshi Chauhan discourses over the prevailing eco-
nomic distraught that has plagued the European Union
The global economy has experienced slow growth since
the US financial crisis of 2008-09, which has exposed
the unsustainable fiscal policies of countries in Europe
and around the globe. Of the big economies, Italy along
with Germany were the first ones to break the 3% an-
nual borrowing limit, followed by France which caused
the euro zone crisis. Greece, which has spent lavishly
for years and failed to take fiscal reforms, was the first
to feel the pain of weak growth. In fact, it never stuck
to its 3% target but manipulated its borrowing statistics
to look good. The result was that the new Prime Minis-
ter George Papandreou, in late 2009, was forced to an-
nounce that previous governments had failed to reveal
the size of the country’s deficits. In reality, Greece’s
debt exceeded the size of the nation’s entire economy
which they could no longer hide.
LSE’s Waltrud Schelkle said that we now need more
trouble in the euro zone crisis before we see bold po-
litical steps towards solving the problem. Generally, the
consensus among participants of the crisis was that
they are dealing with a multidimensional problem that
can be divided into a competitiveness of goods, fiscal
banking and political crisis. But there has been certain
rebalancing between the euro zone periphery and the
core since this crisis began. The reduction in unit labor
costs and current account deficits in Greece, Spain and
Portugal have been because of high unemployment and
hence lower wages and massive cuts in imports, rather
than improvement in productivity. And if the current
pattern of negative growth and relatively high interest
rates persists then several of these countries might join
Greece.
It is believed that Germany, since early stages of the
crisis, realized that the impact would be asymmetric
and hence decided that the periphery will blink first in
the battle. The problem here is that the euro zone
countries are not willing to hand in the sovereignty to
the centre. A currency can only survive if it has a cen-
tralized political theory to underpin it.
This makes us conclude that the solution to the prob-
lem lies in the United States of Europe? This would be
a huge mistake because European societies are too di-
verse and divergent to be managed by a centralized
power and the German population would be against
this move. And this is the reason why Angela Markel
has never dared to propose her vision of Europe to Ger-
man electorate.
Nevertheless, one should not underestimate the
progress that has been achieved. The Euro zone now
has a permanent rescue mechanism, the ESM (a de
facto of European Monetary Fund), which has the ca-
pacity to intervene in the primary and secondary sov-
ereign debt markets and can also inject funds into the
national banking systems. The member states have also
signed the six-pack, the two-pack and the fiscal com-
pact, which will be protected by the constitutional law
or something similar. They have also agreed to hold
regular euro group meetings at heads of state and gov-
ernment level. These are just some of the reforms
unimaginable only three years ago.
This is a lot of institutional change in a short time pe-
riod and this should be commended. But there is still a
long way to go. Many questions about legacy debt, cre-
ation of banking union and reigniting growth are still
unanswered. Undoubtedly, huge political obstacles are
preventing the reforms from happening. May be there
is a need to make this crisis even crisis so that the so-
lutions which now seem impossible became the plan of
action then!
Al Jazeera
3General Assembly
Financially Unstable South Sudan Assures
Judicious Channelization of Funds
Debate continues as the two economies struggle to sta-
bilise, refugee and citizenship crisis also addressed in
council. Palak Nayyar reports.
Both the Sudanese states do not hesitate to admit that
they are in need of external financial assistance, which
is a loud and clear message to the developed countries
that the Sudanese states are open to aids. Also the
committee was successful in garnering realistic solu-
tions to address these financial problems. In a very im-
portant statement by Republic of China, the issue that
came to light was the issue of oil production. China
suggests that instead of looking for an alternative
pipeline, which is not economically feasible for either
of the two States, with the discovery of oil in Kenya in
Rift Valley and across the border of Ethiopia, there is a
possibility of creation of a viable and strategic oil bloc
comprising of Sudan, South Sudan, Kenya and Uganda
which could help the countries flourish with coopera-
tion.
Besides catering to all of their financial needs, it would
also help strengthen their fraying relations. Sudan
made an uncompromising statement directing to South
Sudan to start focusing on reducing the military expen-
diture. The statement stands valid owing to the fact
that South Sudan cannot even practically meet its pub-
lic expenditure. The two countries recognise that they
are facing grave economic, social and political issues.
The very fact that their dispute was given formal recog-
nition is a ray of hope as realising a problem is the first
step of resolving it.
Countries in Council collectively support that the
United Nations urge the developed Nations to invest in
infrastructure and social overheads, like education,
health and power of Sudan Sudan so as to generate
employment opportunities and subsequent betterment
of standard of living of the citizens. The Sudanese
economy was always subject to dependence on the oil
production that constitutes the major part of its GDP.
The chief agenda of the discussion was to look for vi-
able solutions that help in reducing south Sudan’s de-
pendency on oil production and set feet in other
sectors, including agriculture and economic overheads.
Issue of the citizenship crisis, however, managed to
harvest only little. South Sudan urged Sudan to accept
and support dual citizenship, which is not seen as a
practical solution because it fails the purpose of seces-
sion. A more viable solution should be of separate cit-
izenship criteria for both the States, as hundreds of
Internally Displaced People still wait to be told which
State they actually belong to. There are thousands of
Southerners living in North and thousands of Northern-
ers living in South. The Governments’ have been urged
to look into these matters at the earliest as any further
delay shall prove to be detrimental to the little
progress the Sudanese countries have made.
Sudan and South Sudan, along with other countries in
council look forward to enact upon resolutions sug-
gested by the Chinese envoy. The committee, essen-
tially based on securitisation, attempted to overstep its
authority when the member states swayed into dis-
cussing the economy of these Sudanese states. By tak-
ing recourse to discussions related to economic affairs,
the committee focused on devising a solution to the
pertinent problem instead of dwelling in the web of
procedures.
Al Jazeera
4Economic and Socia l Counc i l
Fiscal Deficit in Pieces!Priyanshi Chauhan reports as ECOSOC discusses the im-
plications of fiscal deficit and solutions offered!
Unemployment, inflation and hyperinflation were the
main focus of the Economic and Social Council of the
United Nations. South Korea mentioned the impact of
high fiscal deficit with special focus on unemployment.
Fiscal deficit causes unemployment but if the money
spent by the government is used for productive and
profitable activities then this problem of unemploy-
ment can be solved to some extent. Also, if government
focuses on its infrastructural development then em-
ployment will be created in the process as well as after
the development.
To the problem of unemployment, Germany suggested
that working age of the employed should be increased
so that pension is given at a later age. South Korea also
wants to reduce the strength of trade unions and make
sure that people never say no to the work they are of-
fered. This however, is not a democratic solution. In-
creasing age limit of the workforce will not be a good
idea keeping in mind the health issues of senior citi-
zens. Also if trade unions are weakened by the govern-
ment then manufacturers and business class can
exploit them more. And if people are forced to work
whatever is available for them then they will have no
incentive to go for higher education. Moreover, highly
skilled workforce will be at a disadvantage.
Ireland, Germany and Republic of Korea said that fiscal
deficit can affect the economy in the worst possible
way by causing inflation and hyperinflation. But this
might not always be the case. High fiscal deficit will
lead to inflation only if demand for same goods in-
creases. But government expenditure is also increasing
in the entire process which increases output as well.
With the increase in output, demand for other com-
modities also increases. Thus, money does not always
‘chase the same goods’ and so the problem of inflation
should not exist.
South Korea talked about debt trap with respect to
India rightly stating that one-third of the total revenues
of India are spent in repaying the borrowed money
with an interest to the international institutions. And
then India again borrows money for growth and devel-
opment of the nation thus falling into a debt trap. To
this, South Korea suggested that India should focus on
growth oriented and productivity oriented expendi-
ture. But this at first place is not possible because to
focus on growth oriented expenditure India needs
money which is its problem at first place. Instead India
should focus more on reducing the current account
deficit by increasing exports which will bring down its
fiscal deficit and the desire to borrow money will van-
ish. It is notable to mention that last year, house hold
debt of South Korea stood at 152.3% of disposable in-
come, one of the highest in the world.
Also, Germany and South Korea favored disinvestment
which will reduce the government expenditure and fis-
cal deficit. Disinvestment, however, is not a good idea.
PSUs that the government has been investing in are the
profit making ones. If it starts disinvesting it might save
a lump-sum amount in one year but also lose profits
that PSUs could have made. Therefore, disinvestment
will not be of much help. Ireland, proposed another so-
lution stating that increase in taxes will boost the econ-
omy through tax multiplier which increases output and
income, thus, reducing, the deficit.
Al Jazeera
5Securi ty Counci l
Collective rescue of the dipoles saves
the day for Israel
Despite the success, what made the Palestinian repre-
sentative walk out? Why did US and China, two dipoles
join together to save Israel? Amlan J. Das reports from
the UNSC
In one of those rarest of rare occasions, here at an in-
ternational convention, we find an untold mutual un-
derstanding between two ever contradicting nations,
USA and China. The topic being discussed and analyzed
was about the annexation of land by troops in Israel;
and considering how things transpired earlier in the
committee; Palestinians expected even this to go their
way, which meant UNSC classifying such movements as
illegal.
Right from the very null point, both USA and China
seemed overcautious. In spite of the fact that the in-
ternational community did respond to the issue in a
way which Palestine might have anticipated. Both
countries tried hard to maintain their guards. This
might probably be considering the fact that both USA
and China have their hands colored in various issues re-
lated to annexation of land. Bring up the issue of an-
nexation would also freshen up Chinese occupation of
disputed Indian Territory. As far as US is concerned, ac-
cording to the Centre for Research on Globalisation and
other media reports, their annexation movement in the
Canadian territory might lead to some fingers being
pointed, which they never appreciate.
Thus the cloud hovering over Israel partially faded
away in this due deliberation by the United States of
America and China regarding the issue. Palestine uti-
lized every opportunity to convince the international
community to vote the annexation activities illegal; this
if done, would definitely mean another victory for
them in the global arena, after the UN General Assem-
bly episode. But least to their expectations, the com-
munity did not respond as anticipated.
Situation turned further grim when the frustrated
Palestinian representative expressed his disappoint-
ment by walking off the table. After all the support
flooded by its fellow countries, this walking out surely
suggests the un-fulfillment of the real intention of the
Palestinian delegation. Most probably they walked in
with a prime agenda of categorizing all Israeli activities
illegal in terms of International code of conduct. They
did succeed in a few, but things did not end the way
which they actually expected.
Taking this as opportunity, Israel tried diverting the in-
ternational attention towards the geo-political analysis
of the land of Palestine and on the issue of the missile
attacks by HAMAS. But again their speak up landed
them under the same gloomy cloud under which they
were for sufficient amount of time before USA and
China came to its rescue.
Israel seemed very disappointed of the acquisitions
made over them. As the country speaks now, their clear
demand for sympathy can be made out. Most probably,
they are trying to reach out to their alias. They might
seem to indicate that they can’t tolerate a Palestinian
victory at such a significant platform. It lost all its
hopes when everything turned against them, but an in-
tervention like what USA and China did might lead
them to a final victory. A victory, that would make all
the hard earned achievements of Palestine over the
past two days go vain.
The battle continues, decade long of Israel and Pales-
tine trouble actually could not be accommodated in a
two day meet. Of course things might have got lot
clearer, but very significant amount of work is yet to be
completed.
Al Jazeera
6Photographs
Al Jazeera
7The Team Behind the Scenes
Al Jazeera
The Organising Committee
The International Press Team