November 28, 2009

Iraqi Government Creates YouTube Channel to Increase Engagement to a Larger Audience

In order to promote its message and engage with Iraqis at home and abroad, the Iraqi government launched a dedicated channel on YouTube. In a video message, Iraq's Prime Minister Nuri al-Maliki explains, "The Iraqi government is committed to using this technology to connect to various international communities and to those who follow the issues of Iraq." Mr. Maliki continued, "Iraq today is experiencing great developments, and we have great ambitions to achieve in regard to communicating with people around the world." Mr. Maliki's message about the Iraqi government's latest initiative may be viewed below:

I hope other developing governments follow Iraq’s lead in using the Internet to connect with international investors, nongovernmental organizations, and most importantly, citizens living in-country or abroad. As Hunter Walk, Google's Director of Product Management, wrote on The Official Google Blog regarding Iraq's initiative, "We hope that by launching on YouTube, the Iraqi Government and their citizens will also find it easy to use YouTube to engage in such conversations, and bring their proceedings, policies and ideas to a larger audience around the world." One criticism I have regarding the Iraqigov Channel is the inability to post comments by YouTube viewers. Here is a video message from Eric Schmidt, Google's Chief Executive Officer and Chairman, about Iraq's YouTube initiative:

There is another initiative that is worth discussing regarding Google and Iraq. According to a Embassy of the United States in Iraq press release, "The CEO and Chairman of Google Inc., Eric Schmidt, and members of the Iraq Technology Task Force Baghdad a project to create a virtual tour of the Iraq National Museum using state of the art Google technology. The project, the first of its kind at any museum, will digitize and electronically catalogue artifacts at the Iraq National Museum, allowing global access to the collection. It is part of an ongoing commitment by U.S. institutions to partner with Iraqis under the Strategic Framework Agreement to help support and showcase Iraq's rich cultural heritage and history."

The press release further says Mr. Schmidt "is the first CEO of one of the world's leading technology companies to visit Iraq; the trip marks Google’s third visit to Iraq to collaborate on U.S. Government-led technology initiatives. This public-private partnership fosters U.S.-Iraq cultural diplomacy and exemplifies twenty-first century statecraft—the U.S. government serving as a convener, and facilitator of initiatives and programs that are driven by the Iraqi people in partnership with private companies. This is the first private-sector delegation to meet with the recently established Iraq Technology Task Force (ITTF), which is a multi-stakeholder body created by Iraqis to build the country’s IT capacity. The delegation's visit demonstrates how public private partnerships are about more than contributing traditional resources, they are also about leveraging expertise itself."

Aaron Rose is a board member, corporate advisor, and co-founder of great companies. He also serves as the editor of GT Perspectives, an online forum focused on turning perspective into opportunity.

November 23, 2009

Transatlantic Trends 2009: A Survey of European and American Opinions

On November 19, 2009, I attended a briefing, sponsored by the Trade Development Alliance of Greater Seattle, featuring Zsolt Nyiri, Ph.D., Director of Transatlantic Trends at the German Marshall Fund of the United States in Washington, DC. Dr. Nyiri's presentation on Transatlantic Trends 2009, a project of the German Marshall Fund and the Turin, Italy-based Compagnia di San Paolo, with additional support from the Fundação Luso-Americana (Portugal), the Fundación BBVA (Spain), and the Tipping Point Foundation (Bulgaria), "measures broad public opinion in the United States and 12 European countries and gauges transatlantic relations through interviews with more than 13,000 people." There are a few highlights that are worth discussing in this post.

For the eighth consecutive year, participants were asked their views on each other and on global threats, foreign policy objectives, world leadership, and multilateral institutions. During this time, Europeans took a very negative view of U.S. President George W. Bush. According the Transatlantic Trends, "U.S. President Barack Obama had nearly reversed the collapse in public support for the United States witnessed across much of Europe under his predecessor, President George W. Bush." In fact, my mid-2009, Mr. Obama "enjoyed far more support in Germany, Britain, and even France, than he did in the United States. Such sentiments provide a popular foundation for a revitalization of U.S.-European ties."

Statistically speaking, 77 percent respondents in the European Union and Turkey supported Mr. Obama’s handling of international affairs, compared to just 19 percent who approved of Mr. Bush’s foreign policy in 2008. Furthermore, according to the report, “People of the EU and Turkey (77%) were considerably more likely to approve of Obama than were his fellow Americans (57%). However, segmenting the EU and Turkey stats paints a different picture: Central and East Europeans (60%) were significantly less enthusiastic about Mr. Obama's handling of international affairs than were people in Western Europe (86%), and were less likely (53%) to see America in a positive light than were West Europeans (63%). Lastly, "Fewer Central and Easter Europeans (25%) than West Europeans (43%) believed that relations between the United States and Europe had improved over the past year."

During the presentation discussing the economy, which Dr. Nyiri called "The Dog that Did Not Bark," Americans and Europeans share the belief "that managing international economic problems should be the top priority for the American president and European leaders, trumping concerns over international terrorism, climate change, or the Middle East." The Obama effect is evident in Europeans' attitudes where 79 percent approved of Mr. Obama's handling of international economic affairs during his first months in office; whereas, only 53 percent of U.S. respondents felt the same as their European counterparts.

With respect to the economic crisis, "More Americans (69%) were very concerned about the economic situation than were people in the European Union (47%). This difference reflected a more intense personal economic experience with the crisis. Three-in-four Americans (74%) compared to just over half of Europeans (55%) said their families had been impacted by the recession." Dr. Nyiri attributed the difference as a result of strong social programs Europeans benefit from their respective governments.

Dr. Nyiri further discussed the "overwhelming majorities of respondents in the United States (75%) and in the European Union (82%) thought the current crisis could only be solved with fundamental changes in the way the economy is run." He then noted when separating the responses by political affiliation in the United States, Democrats (85%) and Independents (80%) supported major reform more than Republicans (69%). "In Europe, support for change was more equally shared by respondents of all political persuasions."

And 79 percent of Europeans and 67 percent of Americans believe "that government has an important part to play in regulating the economy. In the United States, however, significantly more Democrats (80%) than Independents (65%) and Republicans (61%) believed in such a governmental role. In Europe, conversely, there was almost no ideological disagreement on this issue."

Regarding climate change, "people on both sides of the Atlantic were concerned about climate change, but respondents in the European Union (48% very concerned) were more intensely worried than Americans (40% very concerned). The most anxious were the Portuguese (62% very concerned), while the least apprehensive were the Dutch (just 23% very concerned) and the Poles (29% very concerned)."

69 percent of European respondents supported policies to combat climate change even if it stymied economic growth. "The French (79%) were the most willing to sacrifice economic advantage for a cooler planet. The Slovaks (53%) were the least willing among Europeans. Only a plurality of Americans (43%) would make such a tradeoff."

I found Dr. Nyiri’s presentation informative regarding the "Obama Bounce" and its positive affect on Europeans attitudes regarding the United States. However, this positive sentiment does not transcend to supporting the wars in Iraq or Afghanistan, or using military force to halt Iran from acquiring nuclear options. And while Mr. Obama has enjoyed vast support from the European Union and Turkey, the honeymoon could end very abruptly if the economy does not rebound at a reasonable rate.

Moreover, as Mr. Obama recently indicated, the United Nations climate change conference scheduled for December 7-18, 2009 in Copenhagen, Denmark, the United States is not prepared to enter into a new global climate-change treaty on limiting emissions of greenhouse gases that would replace the 1997 Kyoto Protocol. I suspect this will adversely affect Mr. Obama's support from Europeans and perhaps, American Democrats.

November 16, 2009

Japan's Plan to Grow their Green Economy

The Japan Business Association of Seattle and Trade Development Alliance of Greater Seattle sponsored an event on November 12, 2009 featuring Mr. Toshiki Takahashi, Director of Japan External Trade Organization's (JETRO) International Economic Research Division. JETRO is a Japanese government-related organization that works to promote mutual trade and investment between Japan and the rest of the world. Mr. Takahashi's presentation, "World Economic Development and the Japanese Economy," focused on the Japanese economy as it relates to the broader global economy. Mr. Takahashi also discussed the investment opportunities that exist in Japan's environmental sector and the country's desire to grow its green economy.

According to a JETRO publication printed in 2007 discussing Japan's environmental sector, "Japan's economic development has so far been supported by a society based on mass production, mass consumption, and mass disposal. Currently, approximately 450 million tons of waste is generated every year, putting waste treatment facilities under unrelenting strain." The publication further explains, "As global environmental problems grow more acute, a concerted effort towards a recycling-based society has begun, and Japan's ecobusiness market is rapidly expanding in both size and range." Japan's Ministry of the Environment predicts the ecobusiness sector will be valued at 47.2 trillion yen (US$530 billion) by 2010.

Moreover, "Ecobusinesses that provide technology, products, or services that contribute to the protection of the environment play a vital role in the creation of a sustainable socioeconomic system with a low environmental impact, and the government will continue to actively promote and foster these businesses in the future." Japanese businesses are "currently developing environment technology under the banner of the '3 R's': Reduce, Reuse and Recycle."

JETRO segments the environmental sector into five key areas conducive for foreign direct investment:

  1. Clean energy: According to the Environment Ministry's "Market Size and Employment in Japan's Environmental Business Sector: Present Condition and Forecast for the Future," the scale of the market for green energy, which includes renewable energy facilities and energy conservation and management, was 890 billion yen (US$10 billion) in 2000, no more than about 3 percent of all environmental business. Due to technological development and reforms, however, the market size is predicted to increase 6.5 times, to 5.812 billion yen (US$65.3 million), by 2010, and grow further, to 9.9 times this size, or 8.798 billion yen (US$98.9 million), by 2020. The clean energy sector includes solar power generation, fuel cells, and energy service company (ESCO) businesses, which provides comprehensive services relating to energy conservation in factories and buildings;
  2. Waste treatment: While the waste treatment and recycling sector market is already large and is expected to grow further, it is supported by small businesses. This industry does not require large-scale existing facilities or huge initial outlays and so small and medium-size businesses, as well as venture companies that are yet to be established, can enter the industry. Studies by the Ministry of the Environment predict the market for waste disposal to grow from 3.614 billion yen (US$40.6 million) in 2000, to 7.736 billion yen (US$86.9 million) in 2010, and still further, to 11.126 billion yen (US$125 million), by 2020;
  3. Recycling: Recycling laws for key items have already been introduced in Japan, beginning with enforcement of the Containers and Packaging Recycling Law in 1997, followed by recycling laws for food, construction material, and furniture, and then, in 2005, the Automobile Recycling Law. With the enforcement of each of these new recycling laws, the trajectory was set for a new recycling sector. A variety of business opportunities have been created in the recycling sector, including development of new technologies, that take advantage of regional government schemes enabled by national government policies, such as "eco-towns" and "designated structural reform districts";
  4. Soil and water remediation: According to the Ministry of the Environment, the size of the soil and water remediation market, including equipment and services provided, was 84.8 billion yen (US$964 million) in 2000. However, it is forecasted that soil and subterranean water pollution controls in Japan will become stricter, and the market will grow to 6.8 times its 2000 size, to 582.8 billion yen (US$6.5 billion), by 2010; and
  5. Air pollution prevention: The number of business opportunities related to air pollution prevention is increasing due to the introduction in 2000 of an ordinance requiring the use of exhaust purifiers in Tokyo, Kanagawa, Saitama and Chiba. In addition, the climate change policies are expected to bring about the full-scale initiation of greenhouse gas emissions trading. Apart from international emissions trading based on the Kyoto Mechanism, domestic trading is also anticipated, allowing every business to fulfill its pollution reduction targets.

(1 JPY=0.0112 USD)

November 13, 2009

The Philippines: An Assessment of Business Opportunities

One of my primary responsibilities as a consultant is advising my clients on expanding their international operations to profitable markets. From small businesses to multinational corporations, the term "globalization" is often thrown around the boardroom and business executives know they need to expand into other, sometimes risky, markets in order to stay ahead of the competition and maximize profitability. The problem is, however, that many executives do not know which markets to enter or how to enter effectively. I had the opportunity to attend a seminar, "Doing Business in the Philippines," sponsored by the Urban Enterprise Center of the Greater Seattle Chamber of Commerce and the Philippine Department of Trade and Investments. There are a few highlights from the November 9, 2009 event that are worth sharing if you are considering doing business in the Philippines.

The purpose of the forum is, according to the event's program, to "introduce small and medium size businesses to the opportunities and considerations (government regulations, processes, cultural influences and situational nuances) in doing business with Philippine enterprises for buying, selling or joint venturing purposes." Ms. Josephine Romero, Trade Commissioner of the Philippine Department of Trade and Investments – Western USA Region made a presentation outlining the business opportunities that exist in this Southeast Asia country of 89 million people.

Ms. Romero noted several attributes of choosing the Philippines as a business destination such as the country's strategic location being three to four hours of flight time from key Asian cities, establishment of a regional hub for logistics that include FedEx, UPS, and Lufthansa Technik, and good access to the 500 million people living in the Association of Southeast Asian Nations (ASEAN). In describing the quality human resources, the Trade Commissioner said the Philippines offers an educated labor force of 32 million whom possess a fast learning curve and very competitive labor rates. Furthermore, 95 percent of Filipinos are literate with English being taught in all schools, making the Philippines the world’s third largest English-speaking.

Regarding the business environment, Ms. Romero explained that the Philippines government deregulated the telecommunications and other key industries and services, the country has strong capital markets and banking system, market-oriented foreign exchange services, and proactive assistance for investors. Other key points made during the presentation include the how the Foreign Investments Act (FIA) of 1991, the law that governs foreign investments in the Philippines, opened domestic market to 100% foreign investment except those in the Foreign Investment Negative List (FINL), redefined "export enterprise" to mean at least 60 percent for export, and 100 percent foreign ownership of business activities are allowed outside the FINL, but without incentives. It was suggested, however, that foreign businesses work with a local partner in navigating the challenges that exist.

Profitable business sectors in the Philippines include customer service, manufacturing (home furnishings, textiles, construction materials, and motor vehicle parts and components), food importation, organic and natural products, information technology and IT-enabled services, renewable energy, and tourism. While the corporate income tax is 32 percent, companies operating in the Special Economic Zones (ecozones) are subject to only 5 percent overall tax rates. Multinationals looking for regional headquarters, said Ms. Romero, are entitled to incentives such as tax exemptions and tax and duty-free importation of specific equipment and materials.

Mr. Sanjay Kumar, Chief Executive Officer of Kirkland, Washington-based V-Customer Corporate Services, spoke about his successful experiences in establishing business operations in the Philippines. He talked about the ease of registering a business entity, working with a qualified labor force, low cost of doing business, and the liberalized and business-friendly environment.

When asked about the challenges of doing business in the Philippines, Ms. Romero responded that e-commerce and wide use of the Internet are not prevalent throughout the country. While Filipinos have access to the Internet, they do not use the technology for commercial purposes. She did explain, however, that the national government is focused on building an IT economy and making the Philippines the e-services hub of Asia. Regarding intellectual property rights, Ms. Romero said piracy is a problem in the Philippines, which is a shared problem throughout ASEAN. She further said the national government is working on a legal framework to enact and enforce IP laws.

I invite readers of this blog to post comments detailing their successes (or failures) of doing business in the Philippines.

Aaron Rose is a board member, corporate advisor, and co-founder of great companies. He also serves as the editor of Solutions for a Sustainable World.

November 10, 2009

Microsoft Executive Talks about the Future of Computing

Prior to his retirement from Microsoft, Bill Gates traveled around the country speaking at college campuses about how Microsoft's innovative technologies are providing the tools to help people resolve the problems of today, and tomorrow. Since Mr. Gates' departure from the Redmond-Washington company, Craig Mundie, Microsoft’s chief research and strategy officer, has led the Microsoft College Tour speaking to faculties and students in the United States. From November 2-5, 2009, Mr. Mundie visited four college campuses, Cornell University, Harvard University, the University of Illinois at Urbana-Champaign, and the University of Washington, discussing how the new capabilities in computing will help solve some of the planet’s toughest challenges, from environmental change, to growing the global economy, to improving healthcare and education. These visits provide an opportunity to show the leading-edge work taking place at Microsoft. (Photo of Craig Mundie courtesy of Patrick Riley/The Daily of the University of Washington)

I had the opportunity to attend Mr. Mundie's presentation, "Rethinking Computing," which was part of the University of Washington’s Computer Science and Engineering Distinguished Lecturer Series. He demonstrated future-looking technologies created by the Computational Science Group at the Microsoft Research Cambridge (U.K.) that show how computer science is changing scientific exploration and discovery. He also discussed the role of new science in solving the global energy crisis such as a state-of-the-art global carbon-climate model that allows scientists to study forests in ways not previously possible. With the carbon model, and another model created by Microsoft researchers showing how populations of trees actually grow, scientists can study how deforestation in the Amazon basin can affect forests worldwide.

Mr. Mundie talked about how machines will respond to gestures through new natural user interfaces, deploy the power of new microprocessors, migrate data to the cloud, and use live data to drive new simulations and visualizations. "We think computing is in its infancy," said Mr. Mundie, noting many people view computer technology has become passé and invisible. "It's going to be important to continue investing in computing. Without it, we'll have difficulty solving these problems." Explaining that the benefits of computing will have to scale as the planet's population increases, Mr. Mundie said, "we will need to move beyond the tradition point-and-click of the graphical-user interface."

The next big change we will see is in display technology, where "we will have a richer way to interact with the computers." The natural user interface (NUI) will create an interface enabling computers to work for you and search using human-like interaction technologies like ink, eye tracking, and voice. Mr. Mundie provided a demonstration of the latest NUI designed by Microsoft's Cambridge research group.

On the topic of cloud computing, Mr. Mundie "sees the cloud as a high scale, often data driven computing assets that are being built now and I think the next big thing will be to think the cloud and the intelligent clients as one big distributive system, not two heterogeneous things that we are forcing to talk to one another."

I enjoyed listening to the presentation and I feel that Microsoft is producing innovative computing technologies that will provide a great benefit and new experiences to users worldwide. One important area where we will see these benefits is in the policy making arena. As Mr. Mundie demonstrated, a new method of computing will become an essential tool for policy makers in making informed decisions. While I see the technical value in the natural user interface, cloud computing will revolutionize the way people access, store, and use information, which I will discuss in greater detail in this blog.

November 5, 2009

Iraqi Refugees Now Receive Food Vouchers Via Text Message

Part of the United Nations system and voluntarily funded, the World Food Program (WFP) is the world's largest humanitarian agency fighting hunger worldwide. The international aid agency launched a pilot project in Damascus, Syria that allows Iraqi refugees to receive food vouchers electronically via mobile phone text messages.

According to WFP's announcement on October 28, 2009, "As part of a ground-breaking pilot project, [an Iraqi refugee] is receiving food vouchers electronically over her phone, which she can then spend in selected government-run shops. Instead of travelling to a distribution center and struggling back with a two-month ration of food, she can now pick and choose to buy what she wants, when she wants." WFP claims this is the first project of its kind in the world. (Photo of Iraqi refugees in Damascus courtesy of WFP/Selly Muzammil)

In describing the details of this innovative initiative, WFP says that "refugees can buy items such as cheese and eggs that are difficult to transport and could not normally be included in a conventional aid basket." Every two months, participants of this innovative project "receive a coded message on a special SIM card, entitling them to a voucher worth US$22 per person. They take their phone along to state-run stores where they can cash in all or part of the 'virtual voucher.'"

"Around one thousand families are involved in the four-month pilot phase, which will be extended if it is successful. The project has been developed in cooperation with the Syrian government, enabling the refugees to redeem their vouchers in state-run stores in the Jaramana and Sayeda Zeinab neighborhoods of Damascus. The mobile phone service provider MTN has donated SIM cards for the project."

According to government estimates, approximately 1.2 million Iraqis reside in Syria, "and, of those, around 130,000 regularly receive food assistance from WFP," explains the Rome, Italy-based humanitarian agency. "Over the last two years, the agency has been texting refugees with the times and locations of food distributions." While other aid agencies have used phone messages and ATM cards to transfer cash to those in need, "this is believed to be the first time mobiles have been used to deliver food vouchers. Schemes involving vouchers are particularly useful in urban settings where food is available but those in need are unable to afford it."

Aaron Rose is a board member, corporate advisor, and co-founder of great companies. He also serves as the editor of GT Perspectives, an online forum focused on turning perspective into opportunity.

November 2, 2009

African Union Ambassador Visits Seattle Promoting Business Opportunities

I had the pleasure of meeting Amina Salum Ali, Ambassador of the African Union (AU) to the United States, during her visit to Seattle. Hosted by the Trade Development Alliance of Greater Seattle and the Africa Chamber of Commerce of the Pacific Northwest on October 27, 2009, Ambassador Ali gave a presentation titled "An Integrated Africa: An Overview of African Economies and the African Union." Since her appoint as the AU ambassador in 2007, this was the Ambassador's first trip outside of Washington, DC that focused primarily on promoting Africa as an investment opportunity. (Photo of Ambassador Ali courtesy of the Trade Development Alliance of Greater Seattle/Allison Peterson)

Ambassador Ali gave an excellent presentation outlining the economic benefits of investing in the African continent. Specifically, she noted the opportunities that exist in manufacturing, agriculture, mining, health care, transportation, and information and communications technology including using mobile phones for banking, education, and medicine. While Africa is not immune to the economic recession, said Ambassador Ali, many investors in Africa are seeing a positive return on their investment. She also encouraged investors to focus on establishing processing operations, which are greatly lacking throughout Africa. Not only is De Beers mining diamonds in Africa, Ambassador Ali noted, the diamond conglomerate is the only company processing its product (diamonds) locally.

Ambassador Ali highlighted the benefits of the African Growth and Opportunity Act (AGOA), which was signed into U.S. law in 2000. According to a website maintained by the U.S. Department of Commerce,, AGOA "provides beneficiary countries in Sub-Saharan Africa with the most liberal access to the U.S. market available to any country or region with which we do not have a Free Trade Agreement. It reinforces African reform efforts, provides improved access to U.S. credit and technical expertise, and establishes a high-level dialogue on trade and investment in the form of a U.S.-Sub-Saharan Africa Trade and Economic Forum."

While acknowledging the humanitarian and military conflicts that exist in Africa, she reminded the attendees, who included several members of the African Diaspora that conflicts will dissipate as standards of living increase and people improve their lives through access to education, job training, medical services, and economic development support. She encouraged the African Diaspora to help promote the benefits of doing business in Africa by speaking positively about their home continent noting Africa's abundance of natural resources, vast landscapes, and diverse cultures.

I had the opportunity to ask Ambassador Ali two questions: (1) What is AU's strategy for combating corruption and properly training local government officials to eliminate corrupt practices that often impede economic development and (2) what legal recourse do investors have to resolve business disputes? In responding to the former, Ambassador Ali noted that many African nations have taken significant steps to combat corruption, which is evident by the regular media reports discussing the latest arrests or convictions. The broad media attention on Africa's corruption, she explained, is not about a failed system, but representative of effective actions and policies aimed to eradicate corrupt practices. She also noted the adoption of the "African Union Convention on Preventing and Combating Corruption" in 2003 and ongoing collaborative efforts between the AU and the World Bank.

With respect to second question, Ambassador Ali said that many local and regional courts have the capacity of handling legal cases to resolve business disputes. Moreover, some parties have opted to seek arbitration or have their cases heard in jurisdictions outside of the AU. I prefaced my question saying that many American investors may take the risk of investing in Africa where infrastructure may be limited, but their concerns reside in not understanding the options available to resolve business disputes.

Having traveled extensively throughout Africa, I know the benefits the continent has to offer for investors. While Ambassador Ali is correct in listing energy, health care, mining, agriculture, transportation, and manufacturing as ideal business opportunities, I favor the opportunities that exist in information and communications technology. As I often discuss on this blog, ICT and specifically mobile communications are producing substantial financial returns for investors and making a social difference for all of Africa.

I commend Ambassador Ali for making Seattle her first U.S. destination outside of Washington, DC to promote the business opportunities that exist in Africa. It is important that other diplomats and government officials representing developing nations take a more proactive approach in attracting foreign direct investment. Feel free to contact me if you are interested in learning more about the investment opportunities that exist in Africa. I am happy to share my experiences of doing business in one of the world's most diverse markets.