Archive for the ‘South-east Asia’ Category

Tony down, Vince up

April 29, 2013

Cardiff promotion Tan and Chan Tien Ghee Fernandes QPR sad

The weekend’s English Premier League soccer results confirm that the team controlled by Malaysian billionaire Tony Fernandes will go down, while the team controlled by Malaysian billionaire Vincent Tan (currently in the league below) will go up.

What makes Third World billionaires waste their money on Premier League soccer clubs?

My working theory is that the habit reflects a desperation for recognition among people whose businesses will never buy them respect. (Actually, Tony Fernandes is a poor example because his Air Asia business is a relatively ‘normal’.)

The typical Third World billionaire who buys a Premier League club does not do something at the office that allows them to hold their heads high in the company of those they would like to be seen with. To wit:

‘So, how did you make your money?’

‘My dad fucked my mum.’

or

‘Well, I got my start robbing a train. Then a I cornered a bank. And now I’m in minerals. It’s important to have good bodyguards.’

or

‘In essence, I gave these guys who run my country a huge bung, and they gave me a licence to print money. So I did.’

So you buy a soccer club. Of course it is also useful to be in London on a regular basis to stash and invest some of your cash, while the UK’s tax laws have been redesigned around the needs of footloose billionaires.

But, in the end, no one will respect you even if, like Abramovich, you win the Champions League.

Methinks it a mug’s game.

 

Premiership clubs controlled by billy-willies:

Abramovich controls Chelsea and, according to Forbes, has spent US$3bn on the club. Meanwhile life expectancy for men in Russia is just 60 years.

Uzbek-Russian billionaire Alisher Usmanov and partner Farhad Moshiri control 30% of Arsenal. Usmanov has long indicated his willingness to increase his stake in Arsenal to full control but has yet to lay his hands on the shares.

Sheik  Mansour bin Zayed Al Nahyan owns  Manchester City.

Mohamed El-Fayed, erstwhile owner of Harrods, still owner of the Paris Ritz, controls Fulham.

Tony Fernandes and Lakshmi Mittal control Queens Park Rangers, who are already relegated. It looked like a good networking opportunity for Tony, founder of Malaysian Ryanair tribute company Air Asia, but will the two still be pals after losing tons of money while achieving nothing?

Vincent Tan, a master of the untendered Malaysian government monopoly concession, controls Cardiff, who are coming up from the division below to replace Tony’s QPR. Other Malaysian billionaires love to hate Vince, but the children of Cardiff momentarily love him. Note that Vince has also signed up to the Gates/Buffett GivingPledge, promising to give away at least half his loot ‘to help address society’s most pressing problems’; (here is his personal pledge). Now that Vince has got his team into the Premiership, he could choose to regard the losses required to stay there as fulfilment of his GivingPledge. What more pressing problem is there than Wales’s lack of a Premiership football team? If other premiership billionaires grasp the angle, Melinda Gates’s phone will be ringing off the hook. Soccer as philanthropy — allowing Third World tycoons to feel better about themselves while watching football. If any of them get the idea from this blog, I would like some tickets please.

There is a Wikipedia table of English football club owners here.

Thoughts beyond the premiership

European businesspeople who constructed more regular businesses invest in clubs some times, but seem to go for smaller clubs. Amancio Ortega, behind Spanish retailer Inditex, put money into Deportivo La Coruna. Francois Pinault, who controls the likes of Gucci and YSL, also controls the football team Rennes. Delia Smith, of English cookbook fame, has a major stake in Norwich. George Soros does have 10% of Manchester United, but that is a big club run for profit.

Oh, the land…

April 15, 2013

Here is a link to a piece I wrote recently for the China Economic Quarterly about the agricultural underpinnings of development. It is something of a taster for a key theme of How Asia Works.

CEQ Q1 2013 Land Policy

How Asia Works

April 5, 2013

I was just sent a link to a first review of my new book, carried in the FT. If you want to see other reviews (assuming there are any), check www.howasiaworks.com. This one I will paste in here since it gives a pretty good synopsis of what the books is about (and, let’s be honest, isn’t entirely negative either).

 

Reap what you sow

David PillingReview by David Pilling

How Asia Works: Success and Failure in the World’s Most Dynamic Region, by Joe Studwell, Profile, RRP£14.99, 288 pages
A woman plants rice seedlings in a flooded paddy field, Taiwan©GettyA woman plants rice seedlings in a flooded paddy field, Taiwan

Why are the northeast Asian states of Japan, South Korea and Taiwan rich, while the southeast Asian ones of Thailand, the Philippines and Indonesia are relatively poor? Is the failure of the latter because of their geography or climate, or is it because their leaders chose wrong-headed policies?

One of the many virtues of the pithy, well-written and intellectually vigorous How Asia Works is that Joe Studwell does not equivocate. South-east Asian nations have ended up on what he calls the “rubbish heap of industrialisation” because they failed to learn the lessons of history. Instead of taking what he presents as relatively simple steps to technological advancement, leaders were captured by their ruling elites or took bad advice from international institutions such as the World Bank. The latter pushed neo-liberal policies – including no protection for fledgling industries – that Studwell considers wholly inappropriate for countries trying to get on the first rung of the developmental ladder. His recommendation to poor nations is to emulate Park Chung-hee, the South Korean strongman who oversaw what became known as the miracle on the Han river: “make public pronouncements about the importance of free markets, and then go quietly about your dirigiste business.”

The measures taken by Japan, then South Korea, Taiwan and, after 30 years of Maoist missteps, communist China were, argues Studwell, threefold. They involved land redistribution, the development of an export-oriented manufacturing policy, and the formation of a closely controlled finance system. The three important development insights, he argues, are that “a country’s agricultural potential is most quickly released when its farming is transformed into large-scale gardening supported by agricultural extension services; that the technological upgrading of manufacturing is the natural vehicle for swift economic transformation … and that finance must be harnessed to both these ends”. Only the small city-states of Hong Kong and Singapore have successfully taken a different path.

The most original part of the book deals with farming. Studwell, whose Asian Godfathers (2007) dissected the failures of crony capitalism, argues convincingly that successful Asian nations were built on radical land reform. Japan began parcelling out land after the Meiji Restoration of 1868, a policy continued after the war when the US occupation oversaw a seemingly un-American exercise in land confiscation and redistribution. South Korea and Taiwan followed suit. Large farms are often considered more efficient because they can be highly mechanised to produce higher yields per farmer or per unit of investment. In other words, they are more profitable. But in poor, labour-abundant countries, Studwell contends, that is not the point. The goal should be to use available labour to maximise yield per hectare, something achieved on smaller, intensively farmed plots.

Maximising yields serves several broader development goals: farmers earn money to spend on local manufactures; higher food production means the state doesn’t have to waste precious foreign exchange on imports; and farmers’ savings can be recycled through the banking system into industry. Both the indulgent leaders of the Philippines, who left vast haciendas in the hands of absentee landlords, and Maoist ideologues, who collectivised land into unproductive large-scale co-operatives, ignored the basic insight on what he calls “the triumph of gardening”.

The sections on industrial policy and finance are more familiar, though the ideas remain controversial among free-market economists who argue that governments can’t “pick winners”. Such economists, says Studwell, misunderstand what Japan, and later South Korea, actually did. The key was to force manufacturers, whether of steel or cars, to export and thus compete on international markets. Those that couldn’t hack it were killed off. Korea, for example, had three putative car champions in 1973 at a time when local auto sales were only 30,000 cars a year. In the early years, the market leader was the now-forgotten Shinjin. Only later did Hyundai emerge as the last car company standing. “The economics of development requires nurture, protection and competition,” he writes. The alternative to such hard-headed, nationally driven policies, he says contemptuously of the Philippines, is “an authentic, technology-less Third World state with poverty rates to match”.

Studwell’s thesis is bold, his arguments persuasive, and his style pugnacious. It adds up to a highly readable and important book that should make people rethink the glib equation of free-market policies with economic success. He also writes with disdain for those who would peddle the “fairy tale” that poor countries can become rich by skipping industrialisation. Of India’s attempt to build wealth through IT services, which employ only a few million people, he says: “Punditry that likens India’s economic development to that of the more northerly countries is fatuous.”

The implication of Studwell’s analysis is that talk of globally converging living standards is overdone. Those countries that do not begin with comprehensive land reform or bully their entrepreneurs into nation-building – as opposed to rent-seeking – are bound to fail. Even the relatively successful ones won’t get further than Malaysia, he says, a country whose botched efforts at industrialisation he likens to attending school but not paying much attention.

That leaves China, which in many ways has emulated the successful northeastern model, through post-1978 land reform and the creation of state champions financed through policy banks. China’s biggest companies, he argues, are closing in on international standards in heavy industry. But consumer businesses are not. As demographics worsen and as vested interests worry more about personal gain than national development goals, he wonders whether China will get stuck.

Studwell’s book is a warning to those who believe that developing countries in Asia, Latin America and now Africa have cracked the secret of growth and will inevitably catch up with rich ones. Only those nations with good policies will make it, he argues. And good policies are out of fashion.

David Pilling is the FT’s Asia editor

 

 

Nakries, Bothschilds, torpor

February 22, 2013

Rothschild 1

Bakrie

Inbred Etonian titty Nat Rothschild takes on legendarily dodgy pribumi carpet baggers, the Bakrie brothers (led by Rothschild lookalike Aburizal). I guess the takeaway is that there is little to choose between the British aristocracy and a bunch of Third World wideboys when it comes to moral conduct. The Bakries have been coining in money in Indonesia ever since the Benteng programme of the 1950s was set up by Sukarno to support ‘downtrodden’ indigenous traders. They weren’t downtrodden then, and they aren’t now. The Bakries made a killing out of exclusive trading licences that did nothing to support Indonesian development. Nat ‘Mr Offshore’ Rothschild, meanwhile, showed how naturally at home he is in a south-east Asian, Latin American or Russian business environment by cutting a deal with the Bakries to ‘reverse list’ their coal assets in London. This is a favourite Third World tycoon game whereby you find a failed listed business and have it take over your real business, thereby avoiding the intrusive due diligence and transparency that can go with an Initial Public Offering. Nat then got in a terrible bait that having gone into business with some of the dodgiest characters in Indonesia they turned out to be dodgy. (His own efforts to ‘tool up’ by bringing in the likes of Hashim Djojohadikusumo, a B-grade tycoon and elder brother of former Indonesian special forces commander Prabowo Subianto, were a flop.) Meanwhile, despite the recent global financial crisis, British regulators let the entire sordid affair carry on, presumably on the assumption that British aristocrats who live in Switzerland can be trusted to keep their own moral counsel. What happened afterwards with the London-listed business is precisely the sort of shenanigans and fleecing of minority shareholders that happens in places like Indonesia. Quelle surprise!

The Guardian explains some of the background.

Here is the Bloomberg coverage.

Here is the FT coverage (subscription needed).

(Almost) nowhere to run to

February 22, 2011


Tunisia, Egypt, Libya… the list of north African countries to which Italian politicians may no longer be able to flee in exile gets longer every day. Bettino Craxi, the politician who ‘made’ Sivio Berlusconi, fled of course to Tunisia (here he is, all remorseful, on the beach). Italian spooks assisted the coup which brought the lately chased out Mr. Ben Ali to power.

Silvio himself might have been expected to skip off to his friend Muammar Gaddafi in Libya if things had gotten really nasty at home. But the way it is looking in Tripoli just now (here is some text from the first US tv crew in), there may be no north African option left. One feels for Silvio after all the effort expended smoothing the path of Gaddafi’s third son Saadi into Italian Serie A football, where he ‘played’ for four seasons and managed a cumulative half an hour on a first-team pitch. It is a wonder that Perugia, Udine and Sampdoria dared to leave him on the bench after his bodyguards in Libya had in 1996 killed eight opposing fans and wounded 39 for mocking this (please note) much underrated footballing prodigy.

Berlusconi has made multiple trips to Libya, including to Benghazi (search ‘Cooperation with Italy’) where the current rebellion started, but he likely won’t be going back soon. Gaddafi came to see Silvio in Italy several times, including just last August when he paid a modelling agency to supply him 200 nubile young women he could give a lecture to on the merits of (his version of) Islam. Muammar and Silvio were such a great team, but the former’s (liberal, London-educated) second son Saif going on telly and promising to keep shooting until the last bullet has put the relationship in a rather poor light.

I guess that in a worst case scenario Silvio can always go to Russia and see his best mate Vlad. But how would he keep his suntan up in Moscow? He could call in some of those unpaid holiday letting favours from Tony and Cherie (‘Flowers for me, Silvio?’) Blair, but he won’t get any more bronzed in north London. Surely there must be somewhere hot and dodgy left in the world where a man on the run can put his feet up? I know. Singapore!

Meanwhile: Stanley Ho, if you are watching, check this out. Perhaps you and Muammar should swap family management tips. Well, you both like ballroom dancing…

Fragrant harbour

February 1, 2011

I make it five times that Stanley Ho has changed his mind over his inheritance… in the last week. It was ‘You can have it’, ‘No you can’t’, ‘Yes you can’, ‘No you can’t’, and yesterday, 31 January 2011, ‘Oh go on, take it and just leave me alone with my dogs.’ Today, glancing at the headlines, it seems he may have changed his mind again but, frankly, I can’t be bothered.

Instead, here is a bit of commentary on the three videos that have been released on YouTube by Stan’s lawyer (I have used the link posted by David Webb). Let’s meet Stanley at home:

Video 1. Stan opens with: ‘We must get back Lanceford [the holding company he held all his big stuff through]’, speaking like and doing a great facial imitation of the bad guy at the start of an episode of Flash Gordon. Then the lawyer, more on him anon, asks Stan about some further comment for the press to which Stan replies he’s game as ‘I want to make it [the story] very big.’ Stan is already laying into Pansy, the daughter who is seen as both the most capable in business and about whom the most malicious and serious gossip circulates (perhaps these two things go naturally together). Then comes the now-famous: ‘It is something like robbery’ quote. Stanley says he wants to go ahead with legal action. Note the furnishing of Stan’s time-warp mansion on the south-side of HK island. To the left you can just catch a glimpse of a hideous mock-baroque table. The staff, family and nurses sneaking by the camera are also good value. In the foreground is the mandatory Chinese tea flask (must admit I have been caught on film with one of those myself) and a glass of hot water. ‘I want a fair division among my family,’ says Stan, before appearing to be pained by some inconvenient fact inside his head (like he never organised a fair division?).   At around three-and-a-half minutes you get a look at the always-on television, the electronic tombstone of the fading godfather. Stan’s ex partner Henry Fok was a big soccer fan, so at least with him you would get to take in the football. Another of Hong Kong’s octogenarian big boys is a closet Arsenal fan, and even has comfy sofas. Many are the mysteries of Confucianism… At the end Stan thanks the lawyer for having ‘blown up’ the whole affair in the space of a few days. The lawyer jokes about a huge fee to come. Or let’s say he laughs while talking about the huge fee to come; it may just be coincidence.

Video 2. Here Stan is trying to explain why he just withdrew legal proceedings and announced he had fired the lawyer. ‘The problem is Pansy,’ he starts. At this point I begin to become more interested in the lawyer than in Stanley. For one thing, you might argue that the lawyer is leading his client at the point at which he responds to Stanley: ‘To which I say: “So what?”’ The lawyer, Gordon Oldham, has a faded (south) Irish accent, though his profoundly undetailed official biography says only that he arrived ‘from the UK’ in Hong Kong 30 years ago. After Stan says Pansy is the problem, a woman, who for me has a stronger Irish accent, says off-camera: ‘But he [Stanley] is not afraid of her.’ What is going on here? My wildly speculative first thought is that there has long been a wee Irish mafia connected with the dogs and the horse-racing in Macau, but this is indeed wildly speculative. I must check further. The only thing I learn quickly from someone who knows Oldham quite well is that he is ‘a clever fellow’. Meanwhile in the video it is subsequently, I think, the Irish-accented woman off camera who butts in again to say to Stan: ‘Gordon will still represent you, ok?’ I think this is right, but then an ethnic Chinese woman I do not know moves across camera right to left saying ‘They made him, they made him [Stanley sign documents against his will]’. Stanley says he was forced during his television appearance to read ‘the plaque’ [cue card] organised by Pansy and Daisy. The video ends with the lawyer saying: ‘Are you telling me that I can now go ahead with filing and getting back your interests in Lanceford?’ To which Stan responds: ‘I suppose so…That’s what I want.’ The lawyer gesticulates everything to Stan as if he is an idiot. But Stan isn’t an idiot, even at the age of 89. After all, he is the one looking at the silly gweilo. Upshot of video 2. I think the lawyer has definitely got some questions to answer. I find it creepy the way he refers to Stan as Dr. Ho, using the title he never earned. Stan’s slaves, like Henry Fok’s (‘Dr. Ho’s office’, ‘Dr. Fok’s office’!) have long done this, but a self-respecting lawyer does not need to. I would also like to see the written consent from Stan to post this stuff to YouTube; it should have been put up with the postings.

Video 3. Roll on to January 30. Stan says Pansy says he can have his shares back, but it is ‘only words’. Third ‘wife’ Ina, who’s got a bunch of stock, doesn’t want to meet. (Ina was the ailing first wife’s nurse when Stanley got the hots for her. If you have ever seen the UK sit-com Are You Being Served you’ll have a picture in your head at this point.) Note that Stan here is saying he wants to get all the share scrip back and ‘then decide what to do’; do you remember the fair division promised in video 1, Stanley? Not much of interest here. It ends with Stan pointing out what a stand-up guy he has been.

Video 4. (Not yet released). Stan sits in his favourite cardigan looking into a full-length mirror intoning the mantra: ‘Mirror, mirror on the wall, who has shagged the most among us all?’ From a pair of old speakers the voice of Michael Jackson responds: ‘You have Stanley, you have’, followed by a trademark yelp. At length Stanely picks up a hand-held mirror and quizzes it: ‘Mirror mirror in my hand, who’s the foxiest in the land?’. From another pair of speakers, the double-deep voice of Errol Brown (per his legendary BabyCham add)  replies: ‘You da one, you da one Stan…’ This continues indefinitely.

A note on the lawyer, February 2:

The verdict from various people who know Gordon Oldham, personally and professionally, is that he is by no means the most amoral lawyer in Hong Kong (a warm breeze wafts across the Big Lychee as Ron Arculli, Stephen Cheong, Charles Lee and pals breathe a collective sigh of relief). Perhaps the mid-point of the opinions is one that calls him ‘aggressive and innovative and he doesn’t give a fuck about anything’. The others range from ‘decent guy’ to ‘slipperier than a donkey’s dick’ (the last, I would stress, is from a journalist who has only seen Oldham’s press performances). Anyhow, there does seem to be some consensus that posting Stan to YouTube without publishing his written consent and a full explanation of what is being done begs various question; as — and several people have said this pointedly — does the posting of edited interviews. You will notice there are plenty of cuts in the tapes. Can we have the full tapes please?

Mr Oldham has not responded to an email to the contact address given on his firm’s site yesterday. I will send another one.

Other points of interest: it seems that Oldham has not acted for Stan on other cases (at least ones I know about). Of course Stan, being a godfather, has almost as many lawyers as girlfriends, and so this is hardly surprising. But it does maintain one’s interest in knowing how Oldham got on the roster for this job. Finally, one who knows Oldham claims the accent is northern Irish, tho it sounded poshed up southern to me.

As to Stan’s choice of lawyer, I think it is good. There is an illustrious history of godfathers using gweilos to front for them when they need to do something very public. Remember all KS Li’s public relations problems at Hutchison in the 80s when he paid himelf a huge special dividend he had said he would not take? That was when he hired Simon Murray. Isn’t it great that everyone trusts white people? I think it’s fan-bloody-tastic.

Tidings

January 12, 2011

The last working week before Christmas is spent in Jakarta. Outside the five-star hotels where the elite congregate, the doormen and cab-boys are under a collective instruction to don Santa Claus hats. They do look quaint. But in a country where Islamic terrorists’ preferred bombing site is the five-star hotel, I wonder if this is not a tad provocative and lacking in concern for employee welfare.

At the end of the trip, in my role as billionaire agony aunt, I spend half a Sunday listening to one of the richest men in Indonesia lament the condition of his country. The China-driven commodity boom, he says, masks a qualitative economic slide back into the ranks of Third Worldism. Or, as he puts it: ‘The real value-added here is practically nil… You cannot just keep digging from the ground.’ We stare morosely at his 50-metre swimming pool as liveried retainers refill our coffee cups. Coming from a guy who, personally, cleaned up roughly two thousand million dollars on mineral investments in the past few years, his testimony is striking. And the point is simple: the asset trading game which passes for economic activity may yield a billion bucks for each of 15 or 20 people, but it is facile, puerile and beneath the dignity of a nation of more than 200 million people. Indonesia no longer has any industrial policy, any manufacturing ambition beyond luring multi-nationals’ processing ops, any sense of developmental destiny.

I heard exactly the same story from another billionaire in Malaysia in the summer. But since he has been down a few quid in recent years, I suspected the tale might be sour grapes. Not so. Even those who have made out like bandits of late say that south-east Asia is going down the tubes. Philippines, Thailand, Malaysia, Indonesia is the presently apparent order of keeling over. In sum, the region has decided, for want of a better expression (I have watched more than one series of The Wire of late), that the best it can hope for is to be China’s bitch. The interesting geo-political takeaway is that these countries in recent decades set themselves up as rather slavish US allies and they are failing. Meanwhile the state which is challenging the US in an increasingly aggressive and frightening manner — China — looks relatively rather successful. They told us in school that economic development was a win-win game, but I think this may have been a simplification. ‘Please Miss.’

Pity for the rich

October 20, 2010

It has been a very long break while I write the first part of a new book. When you are spending all day working on writing, the idea of writing a blog as well becomes rather less attractive. Nonetheless, with all the fun things going on in the world, I am going to see if I can get back into it after the summer break.

Joe Stiglitz (you will need a subscription) has come out swinging with an attack on what has been dubbed ‘QE2’ or a second round of quantitative easing of the US money supply. What is best about his analysis is that it points out the fallacy that monetary interventions are costless (whereas fiscal interventions raise public debt, as we all know). Stiglitz points out that QE1, which involved the purchase of around US$1 trillion of US government bonds and mortgage securities will have a cost down the line as US bond prices fall (or, put another way, as interest rates rise to more normal historic levels). With QE2 set to be of the order of as much as US$2 trillion, the quantitative easing expected to be confirmed in November will involve long term public costs of an even greater magnitude.

Stiglitz points out that fiscal interventions (can) have clear benefits. Of course there is the money you throw down in welfare benefits to those who lose their jobs. But over and above this, you build schools, railways, new energy infrastructure, etc, etc, which has a long term benefit to society. Things may not be the same with the long-run public cost of unconventional monetary policy.

What Stiglitz doesn’t do is to say where the gain from quantitative easing investment is likely to end up. The answer, surely, is that much of it will end up in the hands of the rich. The expectation of QE2 is already driving a big rally in the US stock market. Where QE1 probably prevented rigor mortis in the banking system during the initial shock, QE2 is mainly telling the financial system that stock prices are likely to rise, if only for ‘liquidity’ reasons. From a bullish stock market, the rich benefit disproportionately. The poor see little or no benefit, consistent with a 40-year trend in the US to make the rich richer relative to the poor.

The real gainers from QE2, I think, are going to be the decidedly rich and the super-rich. This is because, unlike the loose monetary policy after 2001 which fed housing bubbles, this time the liquidity is going to drive asset bubbles and stock market bubbles in developing country markets in which ordinary people do not much play. A flood of cheap dollars, passing through the hands of hedge funds which serve the rich, is headed for the stock markets of Thailand and Indonesia, condo purchases in Hong Kong and Singapore, Latin American local currency government bonds, and so on. The financial managers of the already-rich know how to trade these markets, ordinary Europeans and Americans do not.

There was an Asian stock market bubble in 1991-4 during the last great Euro-US recession. But that was largely based on ‘discovery of Asia‘ overexcitement. The emerging markets bubble we should expect next year will be based much more on domestic US monetary policy (remember that interest rates were high in the early 90s). It may serve, indirectly, to force some warranted currency realignments by pushing up the value of currencies that have been artificially held down by government interventions in east Asia. But above all, within the US, the experience is likely to see a large transfer of wealth from the taxpayer to the already opulent.

Upload: final three FEER articles

January 20, 2010

There have been various requests for me to upload some journalism and book-related work, so here is a (small) start. The following links connect to the last three articles I wrote for the Far Eastern Economic Review. We know they are the last articles, because in December the Wall Street Journal (now controlled by Rupert Murdoch), the owner of the FEER, closed that venerable magazine down. I was fortunate to be asked to contribute to the final issue, and wrote a piece contextualising China’s development in terms of what we have seen, historically, elsewhere in east Asia.  From the autumn of 2009 there is a piece about how China developed its iron and steel industry, again with lots of developing country perspective, which also explains why iron ore producers in Australia, Brazil, India and elswhere are making so much money out of China. Finally, in true Chinese spirit, there is a self-criticism of my 2002 book The China Dream, written in late 2008.

Lost in translation

November 17, 2009

A four-state research trip begins at Fiumincino in Rome, where on a Sunday afternoon the worst chaos I have seen in the Italian capital’s airport reigns. Hundreds of people are crammed into the main security area, a single incoherent mass that takes an hour to pass through the security check. Amid the crush, a British genius yells ‘You need to open more channels’ as if he is the only person in the room that this has occurred to. One guesses the airport cannot find enough people to work on a Sunday afternoon, despite an economy shrinking five percent this year. A couple of Italians lose control completely, screaming like lunatics at the security staff; one of them continues in the same vein at a policeman who appears on the scene.

My Air China flight is delayed a couple of hours because it has been snowing in Beijing, so I can afford to be more patient than some; eventually I get to the gate. Seated in economy I dread a sleepless night travelling east, followed by the jetlag from hell. But soon after take-off I doze off and sleep better and longer than I often do when given a business class seat-bed for a speaking engagement.

The reason for my plane’s delay is snow in Beijing – where I am going first – which closed the airport for half a day. The BBC reports this is due to ‘cloud seeding’, a technique developed in the United States but popularised in China. It involves using airplanes or small rockets to seed clouds with silver idodide that induces rain. You cannot make extra rain like this, as I understand it, but you can make rain fall in places other than where it might fall naturally. The Beijing area is perennially short of water. According to media reports, Chinese meteorologists failed to calculate that wind and temperature conditions on this occasion would cause precipitation in the form of snow. The same thing is said to have occurred in February.

It is a brief, one-night stop in Beijing. On both occasions that I pass through the airport, for landing and for taking off to Tokyo, I have a good look out of the window at the Beijing area. Stories continue to be published in the press that pollution has improved. But all I see looking out of plane windows is a cigarette-smoke yellow haze that sits like an inverted shallow bowl over the city area. A pollution report published by the US embassy in Beijing suggests that the pollution story depends on which pollutants you choose to measure; it focuses on fine particles and tells a less sanguine tale than the official Chinese one.

And so to Japan, where I am ever-more struck by just how little English people speak, even in big cities. I am headed out to the countryside to look at the history of land reform, in what promises to be a supercharged, bucolic version of Lost in Translation, minus Scarlet Johansson.

On the upside, I can read about a quarter of the characters I see in Japan, because they come from Chinese. On the downside, I manage to leave my ‘Survival Japanese’ phrasebook at the friend’s house in Tokyo where I stay the first night.

The car I hire in suburban Tokyo has satellite navigation, but only in Japanese. The one real break I get is that before driving out of Tokyo I manage to enter a marker in the navigation system at the place I am staying. If not, I doubt I would ever have returned.

As much as any place I have been, Tokyo has to be seen to be believed. The vast majority of this vast city is low-rise, clap-board style houses reached by narrow (perhaps six metre wide) lanes which, in my experience, are never cul-de-sacs. These lanes, which are all demarcated with white lines that set aside a little of the precious space on either side for pedestrians and cyclists, go on and on and on.

To prove the point, I leave Tokyo by randomly weaving – following a general north-west trajectory shown on the navigation system – and drive for more than two hours through the lanes until I have had enough and switch to a bigger road. Every so often I come across a market, a school, a group of small one-room restaurants and bars, or a railway line. The more central parts of Tokyo are charming. But the sprawl that connects Tokyo with a series of what claim to be separate towns and cities (you only know it from the names) is ugly and unpleasant. I had not realised before how much Japan has succumbed to the American acceptance of acres of malls, discount stores, fast food restaurants and car showrooms along every significant highway in the country. This has brutalised large swathes of a naturally very beautiful place.

Still, driving into the central mountain range of Honshu island, I eventually reach hills too steep for development. This is where the forest land that covers so much of Japan begins. And it is very attractive forest, comprised of many different tree species, part evergreen and part deciduous. At this time of year the colours are phenomenal. I stay a night in Chichibu, epicentre of a large-scale nineteenth century peasant revolt, and then head across to Niigata on the west coast, an area famed for Japan’s best rice (and hence sake). It is here that a small number of pre-Second World War landlord houses I want to look at are preserved.

Niigata City itself is a reasonably attractive place, easy to navigate, and with excellent food. It comes as a shock that three hours on the expressway through the mountains to get there costs Euro50 in tolls.

The lack of English thing isn’t getting any better. There are shops I go into where the staff appears to have not a single word of English among it. I wander out again, empty-handed. I stay in quite a reasonable hotel, but the English there is up to very little. Eventually I find a woman in the back office who speaks enough English to help me programme the navigation system to find the farms I want to see. I don’t think I have ever felt so cut off from people around me in a place I have visited. They are very friendly and polite. We just cannot communicate.

After a couple of days it is time to head back to Tokyo. Getting to the capital is easy enough. Getting across the capital to my friend’s house is where the navigation system marker turns out to be critical. On a Sunday evening I am led by the machine through a maze of flyovers, tunnels, and complex intersections that would have seen me make a dozen mistakes or more trying to follow a map. Even with the satellite system, I get back after five or six hours in the car remembering why I have come to loathe driving: it is all wasted time; you can’t do anything while you are controlling a car.

Next day I fly to Taipei, stay in a grotty airport hotel, and go back to the airport for an early connection to Manila. There I switch to a local flight to Bacolod, the capital Negros Occidental, a place that has been dubbed ‘Sugarlandia’. In the 19th century it was turned into a sugar estate monoculture by European and American families and has remained pretty much that.

As the plane descends, you can already see multiple fires where farmers are burning off the residue in fields where sugar cane has been cut. There is sugar everywhere, even around the airport. November is part of the cutting season and every road seems to have one or more big trucks piled high with brown cane heading towards the nearest Central, as the sugar refineries are known.

I spend three days trying to understand why the land reform programme introduced after the 1986 flight of Ferdinand Marcos has failed to change the lives of most farmers here. Many landlords have found ways to hang on to their estates – the biggest local player is Eduardo ‘Danding’ Cojuangco, perhaps Marcos’s number one crony, who has never been brought to book – while farmers who have obtained plots have often ended up selling them because of debts to usurers. They then become estate workers again earning, at current exchange rates, about US$2 a day. With the help of some well-informed contacts, I manage to visit land reform cooperatives that are being somewhat more successful. We travel into deep countryside that is as stunningly beautiful as it is poor.

Then it is time for a stopover in Manila so that I can obtain a difficult-to-come-by book, a recent biography of Danding Cojuangco. Reading this on the plane home, I am pleased to note a striking parallel between the late Filipino fantasist duce Ferdinand Marcos and current Italian fantasist duce Silvio Berlusconi.

It seems that not only was the latter embarrassed by secret recordings of his pillow talk. Back in 1972, just before Ferdy plunged the Philippines into more than a decade of martial law, recordings of his bedroom exchanges with a B-movie actress called Dovie Beams (who had been making a movie in the Philippines) began to circulate in Manila. The tape, recorded by the actress before she fled the country, featured Ferdy moaning, singing his favourite folk songs, and begging for oral sex. The University of the Philippines radio station took to playing the recordings over and over. Ferdy, as was his standard refrain, said the whole thing was a communist conspiracy and sought to have various journalists jailed. Now where else have we heard and seen that?