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 Chinese cash hurts some Africans
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Posted on 08-21-07 9:42 AM     Reply [Subscribe]
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By Lydia Polgreen and Howard W. French

KABWE, Zambia: The courtyard in front of the Zambia China Mulungushi Textiles factory is so quiet, even at midday, that the fluttering of the ragged Chinese and Zambian flags is the only sound hanging in the air.

The factory used to roar. Since the day it opened more than 20 years ago, the vast compound shuddered to the whir of rollers and the clatter of mechanical weaving machines spooling out millions of yards of brightly colored African cloth.

Today, only the cotton gin still runs, with the company's Chinese managers buying raw cotton for export to China's humming textile industry. Nobody can say when or even if the factory here will reopen.

"We are back where we started," Wilfred Collins Wonani, who leads the Chamber of Commerce here, said, sighing at the loss of one of the city's biggest employers. "Sending raw materials out, bringing cheap manufactured goods in. This isn't progress. It is colonialism."

Chinese officials and their African allies like to call their growing relationship a win-win proposition, a rising tide that lifts all boats in China's ever-widening sea of influence. This year, China pledged $20 billion to finance trade and infrastructure across the continent over the next three years. In Zambia alone, China plans to invest $800 million in the next few years.

From South Africa's manganese mines to Niger's uranium pits, from Sudan's oil fields to Congo's cobalt mines, China's hunger for resources has been a shot in the arm, increasing revenue and helping push some of the poorest countries on earth further up the ladder of development.

But China is also exporting huge volumes of finished, manufactured goods to those same countries, from T-shirts to flashlights, radios to socks, hampering Africa's ability to make its own products and develop healthy, diverse economies.

"Most of our countries have been independent for 35 to 50 years," said Moeletsi Mbeki, a South African entrepreneur and a political analyst. "Yet they have failed to develop manufacturing for a variety of reasons, and for the Chinese that's a huge opportunity. We are a very important market for China."

On the one hand, Chinese imports give Africans access to goods and amenities that developed countries take for granted but most people here could not have dreamed of affording just a few years ago: cellular telephones, televisions, washing machines, refrigerators, computers. And cheaper prices on more basic items, like clothing, light bulbs and shoes, mean people have more money in their pockets.

"There is no doubt China has been good for Zambia," said Felix Mutati, Zambia's minister of finance. "Why should we have a bad attitude toward the Chinese when they are doing all the right things? They are bringing investment, world-class technology, jobs, value addition. What more can you ask for?"

But across Africa, and especially in the relatively robust economies of southern Africa, there are clear winners and losers. Textile mills and other factories here in Zambia have suffered and even closed as cheap Chinese goods flood the world market, eliminating jobs in a country where less than half the adult population has formal employment. And the Chinese investment in copper mining here has left a trail of heartbreak and recrimination after one of the worst industrial accidents in Zambian history: a blast at a Chinese-owned explosives factory in Chambishi in 2005 that killed 46 people, most of them in their 20s.

"Who is winning? The Chinese are, for sure," said Michael Sata, a Zambian opposition politician who campaigned in last year's presidential election on an anti-China platform. He lost, but with a surprisingly strong showing, and his party, the Patriotic Front, won many seats in local and parliamentary elections in the capital and the Zambian industrial heartland, where China has made its biggest investments.

"Their interest is exploiting us, just like everyone who came before," Sata said. "They have simply come to take the place of the West as the new colonizers of Africa."

Officials at the Chinese Embassy in Lusaka did not respond to repeated requests to discuss the country's role in Zambia. But Chinese diplomats across Africa and top officials in Beijing have emphasized the money and opportunity they bring. In Zambia, for example, government officials say that the Chinese are bringing dozens of workers to China for training and that their investments will create thousands of high-wage jobs.

Measured in some ways, Zambia's economy is booming. Copper prices have soared from 75 cents a pound in January 2003 to more than $3 a pound this year, driven in large part by Chinese demand. That demand has pushed Zambia's long-dormant copper mines into record production.

China's state-owned Nonferrous Metals Corp. purchased rights to develop a mine in Chambishi, in the heart of the copper belt, in 1998, and plans to build an export processing zone that will bring as many as 60,000 jobs, according to government officials.

But China's entry into the World Trade Organization in 2001 has given it access to markets across the globe, wiping out thousands of jobs in countries with fledgling manufacturing sectors like Zambia and South Africa.

Despite relatively low wages in many countries, African manufacturers find it very hard to compete, arguing that China's currency policies undervalue the yuan and give Chinese exporters a huge advantage. Many industries in China also benefited at times from subsidies and free or low-cost government financing, making their costs lower.

Beyond that, there are major infrastructure problems in Africa, where industry struggles with inadequate roads and railways, unreliable electricity and water supplies.

"So who do you blame?" said Martyn Davies, director of the Center for Chinese Studies at Stellenbosch University in South Africa. "You can't blame China for being too competitive. China is doing what every other emerging market is doing."

The textile and clothing industry, one of the engines China used to fuel its own economic expansion in the 1980s, has been particularly hard hit in Africa. For decades, African countries exported large quantities of clothes and textiles to developed countries under a trade agreement designed to protect European and U.S. markets from competition from China and others, while encouraging exports from the world's poorest nations. But the trade provision, the Multi-Fiber Agreement, expired in January 2005, putting these countries in direct export competition with China.

Africa found itself once again on the losing end of globalization. If copper is Zambia's bread and butter, manufacturing should have been its main meal just as many economies across the globe have progressed from producers of raw materials to low-tech manufacturing and beyond, a well-trodden path to development.

Zimba, a 40-year-old quality control worker at the plant here who asked to be identified only by her commonplace last name because she feared losing her termination benefits, first got a job at the factory in 1989, after moving to Kabwe from the depressed eastern region of the country with her brother.

She earned a small salary and had free health care and a pension, as well as a three-room house in the workers' compound. But since she lost her job, her family's standard of living has plummeted. The water was turned off, and Zimba does not know where she will get next semester's tuition for her 20-year-old daughter's trade school. "We will see what God brings me," Zimba said.

For Zimba, the transition from salaried work to selling goods for pocket change in the market is a devastating setback to a grim fate she thought she had escaped - her mother was widowed when Zimba was 15 and reduced to selling in the market as well. "I am right back where I started," Zimba said.

As for the Chinese, she bitterly refers to them as "briefcase investors."

"They just fill their briefcases with our wealth and leave," she said.

Such anti-Chinese sentiment has been brewing here for several years. When China's president, Hu Jintao, visited Zambia this year he got the usual red-carpet treatment from his host, President Levy Mwanawasa, but the reception from many ordinary Zambians was nasty. A trip to the site of China's big new investment, Chambishi, was scuttled because of fears of unrest.

The circumstances of the industrial disaster there are still not entirely understood. The mine had been run by the government for decades and had limped along while copper prices slumped in the 1980s. When Nonferrous Metals Corp. bought the rights to develop the mine in 1998, the locals cheered, hoping for new jobs.

In 2003, Keegan Chibuye got one as a mechanic at the mine, a job he was grateful to have in a country where even skilled men like himself struggled to find work. Chibuye's sister, 27-year-old Vennie, also found work under the Chinese, as a computer specialist at an explosives factory on the mine's grounds.

Vennie was the eldest of seven, and her parents had sent her to Britain at great expense, to a technical college in Darbyshire, where she got a diploma in information technology. Another brother, Mwape, got a job as a casual worker in the explosives factory, for a little more than $1 a day, to save money for college.

Keegan Chibuye said he had concerns about the way the Chinese managers were running the mine almost from the beginning. "They were careless," he said. "Safety was not their priority. Everything was about productivity, no matter what."

On April 20, 2005, Keegan Chibuye heard an ear-splitting boom that would shatter his world - a huge blast at the explosives factory.

There was almost nothing left of Vennie and Mwape left to bury. Virtually all the bodies had been incinerated. Only fragments were buried at the graveyard built by the Chinese owners - a finger, an ear, a bit of scalp. As the 46 headstones in the clearing just off the main road testify, most of the workers were young, born after 1980.

Officials of the company that runs the mine did not respond to repeated telephone requests for an interview to talk about working conditions and safety at the mine. But at the Chinese workers' compound in Chambishi, Han Yaping, who identified himself as the company's human resources manager, said the company hoped to help Zambia develop. "China works here in cooperation with Zambia," Han said. "It is friendship."

Asked why the wages at the mine were lower than those paid by other companies, Han said Zambian workers had limited skills and no experience with technology. By way of example, he said, a Chinese worker trying to remove a screw would use a screwdriver. "But a Zambian worker," he continued with a chuckle, "he use his finger."
 
Posted on 08-21-07 9:44 AM     Reply [Subscribe]
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Concern about 'sovereign wealth funds' spreads to Washington
By Steven R. Weisman

Monday, August 20, 2007
WASHINGTON: For years, the Bush administration has shrugged off concerns about the trillions of dollars that the United States owes to China, Japan and oil-producing countries in the Middle East, arguing that these debts give no undue leverage to foreign governments.

But at a time of global financial instability, the administration has started to worry.

American concerns - like those of many European policy makers - focus on a growing but little understood trend of foreign governments converting their debt holdings into "sovereign investment funds" that are acquiring assets in the United States and elsewhere - and could influence the markets when they buy and sell.

In response, the Bush administration is pressing the International Monetary Fund and the World Bank to examine the behavior of these funds, which control as much as $2.5 trillion in investments, and to develop possible codes of conduct for them. Among the proposed rules would be an obligation to disclose their investment methods and to avoid interfering in a host country's politics.

Officially, the United States welcomes all investments, except those that could compromise national security. But a note of caution can be heard regarding investment by foreign governments as opposed to companies. Some officials warn of a possible political backlash as the trend grows.

"Money is naturally going to gravitate toward dollar-based assets because of the strength of our economy," the Treasury secretary, Henry Paulson Jr., said in an interview. "I'd like nothing more than to get more of that money. But I understand that there's a natural fear that they're going to buy up America."

One of the American concerns is over philosophy. The United States has for years preached the gospel of privatization, calling on other countries to sell their government-owned industries.

Now, with sovereign wealth funds, many experts are asking whether cross-border investment is evolving into something new that could be called cross-border nationalization, raising the specter of government interference in free markets - only this time, in other countries' markets rather than their own.

Another concern is the sheer size and potential growth of these funds. Their estimated $2.5 trillion in assets exceeds the sum invested by the world's hedge funds. Moreover, Morgan Stanley, in a widely cited study, projects that these investment funds could grow to a staggering $17.5 trillion in 10 years.

Though sovereign wealth funds do not appear to have played a role in the recent turmoil of global markets, experts say they could in the future, in favorable or unfavorable ways - by selling assets abruptly and precipitating a crisis, or by bailing out funds or companies that are in trouble.

"They could become either the source of the problem or part of the solution," said Edwin Truman, senior fellow of the Peterson Institute for International Economics. "When you have foreign governments holding stocks and bonds, not just Treasury securities, you have to ask whether they will be a stabilizing force or a destabilizing force."

Truman said that it would be easy to imagine that in a future global crisis, Paulson might be calling not just central bankers but also the directors of sovereign wealth funds. "He may be calling them right now, for all we know," he added.

The funds are a product of decades of the United States importing more than it exports. High energy prices have yielded trillions for oil and natural gas producers, from Norway and Russia to the Middle East, while the American thirst for imports of other goods and services has built up the reserves of China, Japan and other exporting giants in Asia.

The political furor over these funds so far has been limited. Efforts this year by China and Singapore to buy stakes in Barclays Bank in Britain, and by Qatar to take over the J Sainsbury supermarket chain in Britain, have caused little stir among British leaders.

Neither Dubai's bid for Barney's, the American retailer, nor China's purchase of nearly a 10 percent stake in Blackstone earlier this year has produced an outcry in the United States, although there have been some repercussions in China over the Blackstone investment's recent losses.

But in Germany, where there is concern about Russia buying up pipelines and energy infrastructure and squeezing Europe for political gain, Chancellor Angela Merkel has warned that purchases by foreign governments or government-controlled companies pose a risk.

"How do we actually deal with funds in state hands?" Merkel said at a news conference in July. "This is a phenomenon which until now has not existed on such a scale."

Probably the most political turbulence caused by a sovereign wealth fund occurred when Temasek Holdings, the state-owned investment branch of Singapore, purchased a stake in the company owned by the prime minister of Thailand, Thaksin Shinawatra. The deal fed anti-government demonstrations that led to his ouster in a military coup in 2006.

The worry is that, beyond the possibility of foreign funds pushing up prices on bonds, stocks and real estate, they might exercise inappropriate control politically or in the private sphere.

Truman, of the Peterson Institute, is one of many experts urging the United States, the International Monetary Fund and the World Bank to draw up codes of conduct that would keep politics out of investment decisions and require the funds to share information about the composition of their portfolios and their investment strategies.

"A government is a different type of animal in the investing world," he said. "We call them sovereign wealth funds, but once you're operating outside your own borders, you're not sovereign in the same sense."

Others favor requiring the funds to place their investment decisions in the hands of nonpolitical managers.

"As Asian countries and petro states get rich, they certainly have the money to try to exert influence," said Kenneth Rogoff, professor of politics and public policy at Harvard. "We don't want that influence to be channeled in a reckless way. There has to be transparency in company governance and financial governance to protect against it."

Paulson and the deputy Treasury secretary, Robert Kimmitt, have traveled to China, Russia and the Gulf to urge top financial officials to adopt greater disclosure of their investment practices and to ban government subsidies or other forms of incentives for their overseas investment activities.

The administration is also telling these countries that they must open their own properties to American investments if they want to invest in the United States.

Kimmitt said in an interview that sovereign funds appeared to be adhering to sound financial practices and not political motivations, at least so far.

"When I was in China and Russia, I was struck by the degree to which, although I was talking to government officials, it was like talking to asset managers," he said.

Sovereign wealth funds have actually been around for decades. The Kuwait General Reserve Fund was established in 1960, and the Abu Dhabi Investment Authority, established in 1976, has investments totaling roughly $800 billion, making it the world's largest such fund.

With $300 billion in its fund, Norway is seen by many financial experts as a model for disclosure of its portfolio strategy, holdings and methods. But it is also unabashedly political, recently pulling its investment out of Wal-Mart, citing accusations that it has violated child-labor laws and scuttled efforts by employees to unionize.

But China and Middle East countries have a long way to go before they are as transparent about their activities as Norway is. Some experts wonder what would happen if China took over a U.S. pharmaceutical company and pressed for changes in prescription drug programs. Likewise, what would the reaction be if an Arab government demanded a bailout or tax break for its company in return for supporting peace talks in Iraq or Israel?

"If these funds buy into a big Fidelity mutual, they make standard kinds of investments that the Yale endowment makes," said Lawrence Summers, the economist who served as Treasury secretary and president of Harvard. "But if they make more direct investments, they become meaningful actors in the economy, and that raises many more questions."President George W. Bush recently signed a bill enacted by Congress to streamline the process of screening and possibly rejecting purchases of American companies by foreigners on national security grounds. But these account for only about 10 percent of such purchases, the Treasury Department says.But a huge outcry resulted a few years ago when a company controlled by Dubai tried to take over the management of several ports in the United States, and when a Chinese government-owned oil company sought to buy Unocal, suggesting that Americans might not accept increasing amounts of foreign government purchases.In both cases, the concern of American politicians was that vital national security assets were at stake. But in the 1980s, national security was not at risk when Americans recoiled over Japanese companies' purchases of high-profile properties like movie studios and Rockefeller Center.

"The Bush administration is right to look at this phenomenon, not with alarm but some attention," said Stephen Jen, head of currency research at Morgan Stanley. "What needs to be more transparent is the strategy and governance of these funds, so you don't suspect of them some dark geopolitical strategy in their investments."
 
Posted on 08-21-07 9:57 AM     Reply [Subscribe]
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British dwarf's penis gets stuck to hoover

A dwarf performer at the Edinburgh fringe festival had to be rushed to hospital after his penis got stuck to a vacuum cleaner during an act that went horribly awry.

Daniel Blackner, or "Captain Dan the Demon Dwarf", was due to perform at the Circus of Horrors at the festival known for its oddball, offbeat performances.

The main part of his act saw him appear on stage with a vacuum cleaner attached to his member through a special attachment.

The attachment broke before the performance and Blackner tried to fix it using extra-strong glue, but unfortunately only let it dry for 20 seconds instead of the 20 minutes required.

He then joined it directly to his organ. The end result? A solid attachment, laughter, mortification and ... hospitalisation.

"It was the most embarrassing moment of my life when I got wheeled into a packed AE with a vacuum attached to me," Blackner said.

"I just wished the ground could swallow me up. Luckily, they saw me quickly so the embarrassment was short-lived."(Copyright © 2007 Agence France Presse. All rights reserved.)
 
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UAE father of 78 eyes new brides for century target

A one-legged Emirati father of 78 is lining up his next two wives in a bid to reach his target of 100 children by 2015, Emirates Today reported on Monday.

Daad Mohammed Murad Abdul Rahman, 60, has already had 15 brides although he has to divorce them as he goes along to remain within the legal limit of four wives at a time.

"In 2015 I will be 68 years old and will have 100 children," the local tabloid quoted Abdul Rahman as saying.

"After that I will stop marrying. I have to have at least three more marriages to hit the century."

The United Arab Emirates newspaper splashed its front page with a picture of Abdul Rahman surrounded by his children, the eldest of whom is 36 years old and the youngest of whom is 20 days old. Two of his current three wives are also pregnant.

Abdul Rahman said his large family lived in 15 houses. He supports them with his military pension and the help of the government of Ajman, one of seven emirates that comprise the UAE, which includes the Gulf trade and tourism hub of Dubai.

Islam allows men to marry up to four women at a time, though most marry only one. The UAE is a Muslim country but is home to migrants from around the world.(Copyright © 2007 Reuters Limited. All rights reserved.)
 
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Time Travel Machine Outlined









Charles Q. Choi
Special to LiveScience
LiveScience.com
Mon Aug 20, 11:55 AM ET





A new concept for a time machine could possibly enable distant future generations to travel into the past, research now suggests.





Unlike past ideas for time machines, this new concept does not require exotic, theoretical forms of matter. Still, this new idea requires technology far more advanced than anything existing today, and major questions remain as to whether any time machine would ever prove stable enough to enable actual travel back in time.





Time machine researchers often investigate gravity, which essentially arises when matter bends space and time. Time travel research is based on bending space-time so far that time lines actually turn back on themselves to form a loop, technically known as a "closed time-like curve."





"We know that bending does happen all the time, but we want the bending to be strong enough and to take a special form where the lines of time make closed loops," said theoretical physicist Amos Ori at the Technion-Israel Institute of Technology in Haifa. "We are trying to find out if it is possible to manipulate space-time to develop in such a way."





Many scientists are skeptical as to whether or not time travel is possible. For instance, time machines often are thought to need an exotic form of matter with so-called "negative energy density." Such exotic matter has bizarre properties, including moving in the opposite direction of normal matter when pushed. Such matter could theoretically exist, but if it did, it might be present only in quantities too small for the construction of a time machine.





Ori's latest research suggests time machines are possible without exotic matter, eliminating a barrier to time travel. His work begins with a donut-shaped hole enveloped within a sphere of normal matter.





"We're talking about these closed loops of time, and the simplest kind of closed loops are circles, which is why we have this ring-shaped hole," Ori explained.





Inside this donut-shaped vacuum, space-time could get bent upon itself using focused gravitational fields to form a closed time-like curve. To go back in time, a traveler would race around inside the donut, going further back into the past with each lap.





"The machine is space-time itself," Ori said. "If we were to create an area with a warp like this in space that would enable time lines to close on themselves, it might enable future generations to return to visit our time."





Ori emphasized one significant limitation of this time machine—"it can't be used to travel to a time before the time machine was constructed." His findings are detailed in the Aug. 3 issue of the journal Physical Review D.





A number of obstacles remain, however. The gravitational fields required to make such a closed time-like curve would have to be very strong, "on the order of what you might find close to a black hole," Ori told LiveScience. "We don't have any way of creating such strong gravitational fields today, and we certainly have no way of manipulating any such gravitational fields."





Even if time machines were technically feasible, the gravitational fields involved need to be manipulated in very specific, accurate ways, and Ori said his calculations suggest any time machine could be very unstable, meaning "the tiniest deviations might keep one from working. We need to explore the problem of stability of time machines further."





Theoretical physicist Ken Olum of Tufts University in Medford, Mass., who did not participate in this study, was skeptical concerning how this new model claimed to sidestep prior theoretical objections to time travel.





Still, Olum noted, "It's important if it's right—that there really is some kind of loophole. So this should be scrutinized very closely." The point of such work, he added, was to "expand the bounds of what's possible, what kind of things we can have and what kinds of things we cannot have."

Top 10 Time Travel Tales You Can't Travel Back in Time, Scientists Say Video: Can You Time Travel? Original Story: Time Travel Machine Outlined



Visit LiveScience.com



Last edited: 21-Aug-07 10:00 AM

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Scientists find ancient gum in Finland





Finns, who introduced a birch-tree sweetener for gum, have found that the habit of chewing sticky lumps dates back thousands of years. Last month, students in western Finland found a piece of Stone Age birch-bark tar, believed to have been used for chewing and to fix broken arrowheads or clay dishes, archaeologists said Monday.


"Most likely the lump was used as an antique kind of chewing gum," said Sami Viljamaa, an archaeologist who led the dig near Oulu, some 380 miles north of the capital, Helsinki. "But its main purpose was to fix things."


Viljamaa said the piece of Neolithic gum was found among artifacts, like dishes and jewelry, in a Stone Age village at the Kierikki Stone Age Center. "It's somewhere between 5,500 and 6,000 years old," he said.


The ancient Finnish habit of chewing gum surged in the 1980s when Finnish scientists discovered that gum containing xylitol, a natural sweetener found in plant tissue including birch trees, prevents tooth decay. Schools began to give xylitol gum free to children after meals, and sales of chewing gum almost doubled during five years as xylitol's popularity grew.


The ancient gum was found by British student Sarah Pickin, who was assisted by four other students at the site, Viljamaa said. "They also found an amber ring and a slate arrowhead, which were great finds," he added.







Last edited: 21-Aug-07 10:01 AM
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