Who is the next............Tunisia.................

Change has arrived “New Political Reality in North African Arab World”

Food Riots in North African Arab World

There are riots in many African Countries recently. Especially the riots have significance looking at the strategic importance of these countries to the west, Algeria, Tunisia, Morocco, and Egypt. These are the countries who are staunch supporters of the western powers and all of them has key role in crushing Islamist. These are the dictators enjoying powers for long time with the help of their western allies in return for so called war on terror efforts. They remain in powers years after years without much growth and development to the nation.

Now youths are angry and want justice. They are angry because they don’t have work, employment, and growth opportunity. The prices are rocketing high and affording anything is difficult. Under these circumstances they are asking for justice from these corrupt regimes supported by their western allies for their own benefit. There are many dimensions to the crisis and none of them are really in the hands of single country in this Globalised environment”.

The famous columnist of Al Jazeera Television Channel Mr. Marwan Bishara writes “The so-called international community has been traditionally silent about totalitarian practices and abuses within its member states, except in cases where certain Western countries or powers have invoked questions of regime oppression either as a tool of foreign policy or championing the cause of human rights for public consumption.

Arguably, the neoliberal economic opening to Western investments has played no small part in the deterioration of the economic situation in Tunisia and other Arab countries.

So that when those regimes, as in Tunisia, co-operated with their Western counterparts on economic or strategic issues, their abuses of power have been generally ignored.

Politics: Algerian President Bouteflika led his country out of the civil war that broke out when Islamists were denied an election victory; since the 1990s.

Economy: Algeria is a key oil and gas supplier

In 1992 a general election won by an Islamist party was annulled, heralding a bloody civil War. However, poverty remains widespread and unemployment high, particularly among Algeria's youth. Endemic government corruption and poor standards in public services are also chronic sources of popular dissatisfaction.

Major protests broke out in January 2011 over food prices and unemployment, with two people being killed in clashes with security forces. The government responded by ordering cuts to the price of basic foodstuffs.

Algeria has seen three days of unrest over the rising costs of living and unemployment, which government figures show standing at about 10 per cent, but which independent organizations put closer to 25 per cent.

Layachi Ansar, professor of sociology at Qatar University, told Al Jazeera that the cutting of food taxes and duties was "a superficial measure" that doesn't address "the deep crisis" going on in Algeria, connected with the "unequal distribution of wealth - this wealth is spoilt by corruption, by bad governance and lack of accountability of government officials and state civil servants".

'Out of control'

Mohamed Ben Madani, editor of The Maghreb Review, said the situation was "out of control" and that the protests could continue for weeks.

Mohamed Zitout, a former Algerian diplomat, told Al Jazeera: "It is a revolt, and probably a revolution, of an oppressed people who have, for 50 years, been waiting for housing, employment, and a proper and decent life in a very rich country.

"But unfortunately it is ruled by a very rich elite that does not care about what is happening in the country - because they did not give people what they want, even though the government has the means to do so, the people are now revolting."

If we look at the other side of the story why this all is happening. Even though economy is slow, there is enough food for everyone and prices are going UP.

According to World Bank “The world economy is moving from a post-crisis bounce-back phase of the recovery to slower but still solid growth this year and next, with developing countries contributing almost half of global growth, says the World Bank’s latest Global Economic Prospects 2011.”
The World Bank estimates that global GDP[1][1], which expanded by 3.9% in 2010, will slow to 3.3% in 2011, before it reaches 3.6% in 2012. Developing countries are expected to grow 7% in 2010, 6% in 2011 and 6.1% in 2012. They will continue to outstrip growth in high-income countries, which is projected at 2.8% in 2010, 2.4% in 2011 and 2.7% in 2012.

Global Stock Market Performance in 2010

The following are some of the key points from a review of the 2010 performance of equity markets around the world:

Stock markets can rise despite low or poor economic growth. The U.S. market was a perfect example of this scenario. While the U.S. economy continued to struggle last year with high unemployment rates, slowing demand, more bank failures and other negative events, corporate profits rose and equities took off ending the year with double-digit returns for the S&P 500.

It was a very good year 2010 for many markets with amazing returns. India gave a 16% odd returns in 2010. The MSCI Emerging Markets Index (+16.4%) had done enough earlier in the year to outperform the MSCI World Index (+9.6%) by a wide margin for the year as a whole.

FAO food price indices

The FAO Food Price Index in December slightly surpassed its peak of early summer 2008. The indices of sugar and oils and fats increased the most.

o In Asia, domestic prices of rice further strengthened in December and are at record levels in several countries.

o Prices of wheat and wheat flour in importing countries of Asia, Latin America and Africa, remained at high levels.

In December 2010, the FAO Food Price Index averaged 215 points, 1 point above its peak in early summer 2008. The highest increases were recorded for the Sugar and Oils and Fats price indices. The December 2010 index was up 25 percent from December 2009. The Cereal Price Index rose to 238 points, up as much as 39 percent from December 2009.

Why this rise:- If we look at the present global scenario and prices going, there is big gap between what it should be and what it is. When economy is really not growing, poverty is increasing, food supply is enough………still Prices are going up………. The reason is not poor got more money to eat more unfortunately according to George W Bush ex US president when he Said “ India and China eating more”, and according to recent statement of Indian Prime Minister Dr. Manmohan Singh, economist himself and beloved US follower “ because people got more disposable income so prices are rising.” Unfortunately this can not happen, when people spent more they spent more on cream and not the basic staple food, in fact basic consumption of staple food goes down. The answer lies in the Commodities market! 24/7 casino’s played across the world to make money and make more people hungry and deprived.

The price of traded food staples such as wheat, corn and rice soared 26 percent from June to November, nearing the peaks reached during the global food crisis of 2008. According to the UN Food and Agriculture Organization, 925 million people worldwide suffered from hunger in 2010, an increase of about 150 million since 1995-97. One third of children in the so-called developing world are malnourished.

The new explosion in commodity prices is being fueled by the cheap credit policies of governments and central banks in Europe, Japan and, above all, the United States, where core short-term interest rates remain near zero. The Federal Reserve in November announced that it would purchase $600 billion in US Treasury securities by, in effect, printing dollars. This cheap-dollar policy has the effect of debasing the world’s primary trading and reserve currency, thereby fueling inflationary tendencies around the world and increasing the flow of hot money to emerging economies with faster growth and higher interest rates.

In the US alone, corporations and banks are sitting on some $3 trillion in cash which they refuse to invest in production and hiring. A good portion of the global surfeit of cash is being used to ramp up the prices of commodities from oil, copper, cotton, gold and silver to food staples such as wheat, corn, rice and soybeans.

A major factor in the rise in corn prices is the diversion of a third of US corn production to the more profitable production of ethanol in 2010.

In the United States, which harvested 416 million tonnes of grain in 2009, 119 million tonnes went to ethanol distilleries to produce fuel for cars. That’s enough to feed 350 million people for a year.
The combined effect of these growing demands is stunning: a doubling in the annual growth in world grain consumption from an average of 21 million tonnes per year in 1990-2005 to 41 million tonnes per year in 2005-2010. Most of this huge jump is attributable to the orgy of investment in ethanol distilleries in the United States in 2006-2008

In the past four months, the Silver has risen 51 percent to a series of 30-year highs, before inflation. It closed last week at $29.31 a troy ounce, as compared to $16.822 at the beginning of 2010―a rise of 74 percent. Wall Street Journal writes “Of the general surge in commodity prices, the Journal wrote: “Prices are rising despite over-supply and a lackluster recovery in industrial demand. Many analysts expected those factors would keep a lid on prices in 2010. What they didn't expect was an overwhelming flow of money into the market from investors eager to ride a commodity rally.”

FOOD PRICES AND INFLATION

If all the food in the world were shared out evenly, there would be enough to go around. That has been true for centuries now - if food was scarce, the problem was that it wasn't in the right place.

The poor, urban multitudes in these countries (including China and India) spend up to half of their entire income on food, compared with only about 10 per cent in rich countries.

When food prices soar, these people quickly find that they simply lack the money to go on feeding themselves and their children properly - and food prices now are at an all-time high.

Unfortunately we live in world which does not understand logic and rationales. Only vested interest of Global Powers and Power Brokers and lobbies prevail. No one care how many will die of hunger and poverty.