Measuring with tenses...(18/8)

Today is Wednesday, and it reminds me of a friend who joins me for wine tasting from time to time. As a practice to appreciate different wines, we rate each wine tasted according to our own preferences – aroma, fruitiness, tannin, complexity, readiness to drink, after taste, vintage etc. Instead of the conventional rating in numbers, he likes assessing the quality of wine in terms of the day of the week. So he would say, ‘this is a Wednesday early afternoon!’. I always wonder how Wednesday tastes like…
Borrowing his sense of measurement, I try to ‘make use of’ the day and time to evaluate daily life. Shared with many of you, I spend part of my working life concentrating my mind in an office, and after a while, I get used to the regular rhythm of the weekday-working module. I apply the ‘day-and-time’ ruler to measure my indoor working mode, and then I come up with a general phenomenon that Wednesday is often the most productive day, at least it cohesively balances the flow of work tasks and planning of the week. After some warm up on Monday and Tuesday and the ‘due diligence’ to properly handle the follow up work carried forward from the previous week, Wednesday is a good moment for effective processing and new planning for project tasks. Then, the work process cycle repeats…
Of course, there are deadlines to meet for different tasks and the generalised approach is subject to applicability. Yet, the sentiment is always there.
Following the logic, I choose to take advantage of Wednesday and take a layman approach to wildly consider how developing economies can attract FDIs for growth. My assumption bases on the idea that such developing economies need to foster their export-led development as a motor to growth, and they would have to strengthen their readiness, capacity and competitiveness to engage in export business. In an ideal scenario, the economies advocate the export trade initiative, and all the people act in favour of the goal to increase the volume and the efficiency of trade as long as the marginal benefit to the economy retains. One of the concerns for the developing economies is their unfavourable infrastructure capacity to ‘fairly’ trade with other countries as well as the sustainability to maintain the momentum to trade. Some say attracting FDIs is one way to boost their supply-side capacity to trade. So how the economies can attract FDIs become strategic, and sometimes more like ‘an art’ to stand out from other capital-seeking competitors.
Globalisation symptomises intensified competition to attract FDIs, and it perhaps leads to a higher tendency to more volatile FDI flow. In order to look ‘attractive’ to investors and donors, the developing economies have to find a way to nicely present a favourable atmosphere and timing for FDIs, and they have to showcase their niche and potential to development and growth. A prescription of improving governance (if not good enough), stable political scene, anti-corruption move, more liberalised economic development, favourable rules and regulations to FDIs etc. calls for a good moment for FDIs to come. Next, the economies may have to spend some effort in promoting themselves, or in other cases, the international organisations and other investment stakeholders have to aid the economies to derive and implement promotion strategy to attract capital to invest and facilitate sustainable trade development.
When I wonder if there is a best practice to promote developing economies as a prosperous investment spot and a good trade partner, I list some implementation dimensions below for brainstorming purpose.

- So as to look prosperous, how about organise a big event? World Cup in South Africa? World Expo in Shanghai? APEC Meeting in Vladivostok?
- Or it would be more pragmatic and match-making to conduct investment and development roadshows? Do investors listen? Are they convinced?
- To deal with the fundamental trade capacity, is it always good to launch JV Infrastructure Development with favourable terms offering to FDIs? Construction of road, bridge, dam, port, electricity grid or power network? Set up Free Trade Zone, Science Park, manufacturing cluster?
- Natural resource may not only be a curse…is it viable to promote FDI-driven local tourism? Sustainable tourism? World heritage sites? Patented Rainforest or Safari tour? Boat cruise and duty free zone? Processing hub for gemstones?
- Explore developing export business sectors related to cultural and ritual activities? Music carnival and musical instruments? Film festival? Food exhibition? Pilgrimage together with ritual products and services?
- Highlight Social Responsibility? Ethical textile and handcraft? Organic agriculture? Job-creating ethical industries in local communities?

Are they effective? How much would they contribute to national economy? Are they sustainable in view of the volatility of FDI flow in times of financial turmoil? I guess there is no best scenario, and depending on the niche of each economy, there is a need for more customised approach. While we consider how to attract more FDIs to boost development, we should also consider how much benefit FDIs can bring to the economies.
Going back to the current scenario, how can the least developed economies move forward to get through basic challenges like malnutrition, sanitation, vulnerability to natural disaster, education, corruption, governance and so on? We may still only be in a Monday misty morning…

A kaleidoscopic perspective of trade development...(16/8)

...instead of promoting trade for one economy in most cases where national TSIs do, the UN agency specializes its global trade promotion with a special focus in the developing and the transitional economies, and with its accredited statue under the multilateral system, the agency demonstrates its capacity to facilitate export trade in these areas. Yet, it also shares many challenges faced by the TSIs and the state governments. From an administrative concern, it is important for the UN to stay accountable to its stakeholders and donors in resource allocation; performance measurement; execution of multilateral initiatives like the MDGs and A4T; promotion strategy and political neutrality etc. In view of more pragmatic tasks the UN has to achieve, it encounters the same challenges all the TSIs strive for like effective outreach to exporters and traders; timely and relevant dissemination of market research and indicators to the SMEs; relationship management with state authorities and export agencies; means to build export capacity for traders in the developing countries, particularly in the LDCs and so on.

I would say trade promotion is never an easy task, not to mention the obstacles trade promoters face during moments of economic downturn and resurging protectionism and anti-globalization. International trade is a mutual understanding among trading partners. I am interested in the different norms and practices implemented by different economies on trade development and liberalization. From what I learnt from my working experience, the differentiated political circumstances, readiness of trade connectedness and supply-side infrastructure of the economies usually determine the extent of openness to trade development, and a closer look of their political perspective and cultural heritage aids a better comprehension of the varied approaches to trade business and the corresponding institutional set-up. While international trade is considered to be a means to combat poverty and foster global development and growth, what the trade facilitators would need is a sense of comprehension and a stronger support of multi-lateral cooperation among the states in a global sustainable development.

In Hong Kong, free trade policy has been deeply rooted since its transition from a fishery village in the mid 19th century into a highly service-oriented cosmopolitan city in Asia at present. Its importance in trade and investment has been well recognized by the businessmen and traders, and robust trade figures substantiate its significant role in global trade. Hong Kong has the world’s busiest airport in terms of international cargoes and the 2nd highest per capita holding of foreign exchange. The city is also the world’s second most competitive economy and is the world’s largest IPO market, notwithstanding its tiny area of only 1,100 plus square kilometres (smaller than Faroe Islands, Comoros or Mauritius). As a Special Administrative Region, Hong Kong, though under the territory of China, remains a degree of autonomy in economic development and political governance.

The interesting ‘governance model’ attracts discussions in the academic field. As a citizen of Hong Kong, I am fascinated by the ‘New Growth Theory’, advocated by Paul Romer, which examines the development model in the developing economies. He recommended setting up of ‘Charter Cities’ in the developing countries and quoted Hong Kong as an example to substantiate his development model. Whether the establishment of these Charter Cities can officially be agreed among the sovereignty states, Romer’s study on the importance for the developing economies to accelerate trade infrastructure development and promote a constructive flow of labour forces to participate in the development of Charter Cities is worthwhile studying.