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Global Crisis/Innovation Blog

When Millions Die of Hunger and Thirst – Do We Care?

By Shlomo Maital

 Somali refugee: “I don’t know what to do!”   

I write this, sitting in a comfortable easy chair, watching TV and sipping a cold drink.  What I am watching is the unfathomable misery of millions of Somalis, who are helpless in the face of drought and civil war. 

  According to the website Huffpost, 

   “the head of the U.N. refugee agency, Antonio Guterres, speaking in Dadaab, Kenya,  said Sunday that drought-ridden Somalia is the “worst humanitarian disaster” in the world after meeting with refugees who endured unspeakable hardship to reach the world’s largest refugee camp.  The Kenyan camp, Dadaab, is overflowing with tens of thousands of newly arrived refugees forced into the camp by the parched landscape in the region where Somalia, Ethiopia and Kenya meet. The World Food Program estimates that 10 million people already need humanitarian aid. The U.N. Children’s Fund estimates that more than 2 million children are malnourished and in need of lifesaving action.”

  There are already 390,000 people in the camp, whose maximum capacity is only 90,000.  Kenya is reluctant to admit any more refugees from Somalia.  And Somali radical Muslim gangs – the Shabab – kill UN personnel who dare to enter Somalia to offer humanitarian aid. 

        “Guterres spoke with a Somalia mother who lost three of her children during a 35-day walk to reach the camp. Guterres said Dadaab holds “the poorest of the poor and the most vulnerable of the vulnerable.” “I became a bit insane after I lost them,” said the mother, Muslima Aden. “I lost them in different times on my way.” Guterres is on a tour of the region to highlight the dire need. On Thursday he was in the Ethiopian camp of Dollo Ado, a camp that is also overflowing.”

   Somalia is abysmally poor, ranking 224th in the world in per capita income. It achieved independence in 1960, and has been torn by civil war since 1991.  It is a nation essentially without a government.  It is bordered by Djibouti, Kenya and Ethiopia. Ethiopia at times has sent soldiers into Somalia, to establish some order, but it was futile.      

    Scenes on TV from Dadaab are horrendous. Yet I wish there were far more.  I wish they would be shown every single night, to wake up the world.   As world population touches 7 billion, and as climate change produces terrible droughts on several continents, I fear Somalia is only the first act in a long series of tragedies.   I don’t see how any of us can remain comfortable or complacent, in the face of such horrible suffering.   

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Global Crisis/Innovation Blog

How to Play the China Card

By Shlomo Maital

    China’s economy grew by 9.5% in the year to the second quarter,  cooling slightly.   As America struggles with 9.2 per cent unemployment, and Europe seems impotent to resolve the euro crisis now spreading to Italy,  China’s market seems one of the few places where new and old businesses can find growth.

   But where? And how?

   A new McKinsey   report provides suggestions, from their office in Shanghai. Here are some of their recommendations, based on five key sectors:

  • New strategic industries are singled out for global leadership.
  •  Domestic-consumption engines drive consumer growth in the homeland.
  •  Restructurers are under government mandate to change.
  •  Reinventors are mature industries that must innovate and reinvest to close the gap with global leaders.
  •  Social utilities are large state-owned enterprises managing significant components of the national infrastructure.

    Here’s what they mean. China wants to dominate biotech and cleantech. This area will get high priority and ample funding. If this is your line, China is your (gold)mine.   Airlines, food, pharma, shipping, tourism – these are domestic consumption engines, which will boom as the Chinese middle class expands and spends. To win here, you have to offer products precisely tailored to the Chinese middle class and its rapidly changing tastes. They seek global brands, prestige, quality and fair prices.  Real estate and banking are both shaky. China’s government wants to restructure them, reinvent risk management models, and stress affordable housing. If you have expertise in these areas, you can do well in China.  China has a lot of mature manufacturers who need to upgrade.  If you have productivity tools to help them, you can prosper in China. China’s infrastructure – power, railroads, roads, communications – are state-run, often poorly. China’s government knows this and seeks ways to upgrade the management of its infrastructure, as it spends billions on the physical infrastructure itself.

   China’s 12th Five-Year-Plan is worth reading carefully. It offers massive business opportunities for those who know how to imagine, move..and scale.  And China has scale in spades.

Guangyu Li and Jonathan Woetzel , “What China’s five-year plan means for business”, McKinsey Quarterly,  July 2011.

Blog entries written by Prof. Shlomo Maital

Shlomo Maital
July 2011
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