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TOP HEADLINES 17 April 2012
1. SOUTH ASIA: Labor force guards against economic crisis
2. INDONESIA: Another giant awakens
3. SRI LANKA Uncertain policies seen as deterring investment
4. INDIA: Farm productivity gains come with risks
5. TAJIKISTAN: Lack of private investment unsustainable
6. PRC: Healthcare reform must break gray-income chain
7. MYANMAR: Infrastructure needed for labor-intensive industries
8. LAO PDR: Communal land titles could save more than forests
9. AFGHANISTAN: Trade through western province on the up
10. PHILIPPINES: Getting the most from 'coco-nomics'
IN DEPTH
1. SOUTH ASIA: Labor force guards against economic crisis
Source: Tribune

"South Asia has faced enormous employment challenges in the past century, but the worst of economic disasters has also brought with it a wave of change. An estimated 1.2 million new workers will join the labor force every month over the next few decades -- an increase of around 25 to 50 percent over the historical average. The challenge will be to absorb them into the workforce with rising levels of productivity.

With average creation of over 800,000 jobs per month between 2001 and 2010, there remains hope. Open unemployment is low, wages have increased for the salaried class, while poverty has declined for the self employed. South Asia has mostly created better jobs. Job quality can be determined through wages and poverty estimates, coupled with the risk of low and uncertain income at the same time: both trends have shown a positive variance."



2. INDONESIA: Another giant awakens
Source: Listener

"Indonesia's booming economy has come through the global financial crisis largely unscathed, with annual growth of over 6 percent, conservative government debt levels and a stable exchange rate. A key engine of Indonesia's recent economic resilience is its fast-expanding middle class. Depending on whose figures you prefer, as many as 131 million Indonesians are considered 'middle class,' out of a total population of 238 million.

Indonesians are buying cars in record numbers: almost 900,000 new vehicles (fueled by heavily subsidized petrol) were unleashed onto the roads last year, an increase of 16 percent. Eager to profit from this rampant growth, big auto brands like Toyota, Nissan and Honda are rushing to build and expand manufacturing plants in the sprawling archipelago."



3. SRI LANKA Uncertain policies seen as deterring investment
Source: Lanka Business Line

"Private investment in post-war Sri Lanka has not risen as anticipated because it still lacks a 'predictable policy environment' that creates uncertainties for businesses, the Asian Development Bank (ADB) has said. The outlook is for moderate but still strong growth in Sri Lanka in 2012, the bank forecast in its Asian Development Outlook report released last week.

While the government has been trying to reduce bottlenecks to growth not enough has been done to cut red tape, the report said. Investor confidence is a key factor in attracting investment and this requires a predictable policy environment as articulated and reinforced through the legal, regulatory, and institutional framework, the ADB said. The government wants to see a greater role for the private sector through increased investment by both domestic and foreign investors, as investment is needed to bolster growth."



4. INDIA: Farm productivity gains come with risks
Source: Hindu Business Line

"There have been strident demands for increasing India's agricultural productivity. The recent calls for incremental productivity growth and technology diffusion are a pre-requisite for inclusive growth. There are calls for farm mechanization, corporate farming, use of man-made or modified seeds, introduction of futures, better irrigation, research, and agricultural labor skill upgrades.

However, these are not without risks. Any sharp or sustained productivity gains might prove socially catastrophic. Firstly, agricultural products prices tend to fall steeply with increases in supply, especially in closed markets such as India. This is both due to rigidities on the demand side and the perishable nature of most commodities. Price slumps benefit the urban poor. But income shrinkage can seriously affect land owners and landless agricultural-labor."



5. TAJIKISTAN: Lack of private investment unsustainable
Source: Eurasia Net

"Tajikistan's economic growth, hinging on remittances and public spending, is not sustainable without substantial private investment, but Dushanbe is doing too little to stimulate a friendly climate for investors, says a new report by the Asian Development Bank (ADB). On paper, Tajikistan's economy looks in decent shape. GDP grew by 7.4 percent in 2011, up from 6.5 percent in 2010, says the April report. The Bank expects 5.5 percent growth in 2012.

Agriculture grew by 7.9 percent, despite difficult climatic conditions. Cotton production shot up by 34 percent, reflecting a 30 percent rise in the area devoted to cotton, as high international prices encouraged additional planting. But services -- fueled by rising remittances from labor migrants abroad -- were the main source of growth, expanding by 13.5 percent. Services alone are not a healthy base for any economy, especially when a country has little industry, chronic energy shortages, and a poor record attracting investment."



6. PRC: Healthcare reform must break gray-income chain
Source: China Daily

"PRC's current round of healthcare reform, launched in April 2009, is guided by the policy that basic medical services are a public service that should be available to all citizens. The state offers basic medical services as public goods, while individuals pay for their own specific needs. Today the healthcare system offers 95 percent of the population affordable basic medical services.

But to further propel the reform requires ending the long popular practice among public hospitals of making profits from prescribing medicines. Due to low government funding, doctors at public hospitals generate income for the hospitals through prescribing expensive drugs and treatments. It is time to break this gray-income chain, so that public hospitals and clinics prescribe only the medicines patients need rather than medicines that make the most money for the hospital."



 DEVBlogs ROUNDUP
The complex challenge of ushering agricultural innovation can be considered at a very basic level as the need to improve information content and information chains of market supply. A core pathway to introduce agricultural innovation globally is to improve availability, accessibility, applicability and ensure the relevance and usefulness of information for the intended users and enable agricultural communities to appropriate information and, through effective learning, use it as new knowledge, skills and technologies. This pathway is increasingly being recognized as crucial and central for agricultural innovation to occur and spread rapidly.


7. MYANMAR: Infrastructure needed for labor-intensive industries
Source: Jakarta Globe

"Don't imagine that restoration of Myanmar to normalcy and a degree of prosperity will be quick. Even under the most favorable local and external circumstances, it will take years to make up for four decades of decline and to rebuild the stock of human and physical capital that once made it the most prosperous, best-educated country in mainland South and Southeast Asia.

The expectation of a removal of sanctions and a new flood of foreign investment has led to a surge in land prices in some parts of Yangon. How quickly new investment actually arrives depends on many factors, with the speed of ending sanctions and Myanmar's policies on foreign direct investment being only two of them. Much infrastructure investment -- power in particular -- is needed before even labor-intensive industries such as garments can be expanded for world markets."



8. LAO PDR: Communal land titles could save more than forests
Source: Integrated Regional Information Network

"With pressure on natural resources increasing in Lao PDR, the first community land titles granted to five villages in Vientiane Province could provide a national model for environmental protection while safeguarding the livelihoods of villagers. The title deeds cover an area of 2,189 hectares of bamboo-producing forest. After a two-year process the land was finally handed over to the five villages in Sangthong District in February.

The government's 2011-2015 development plan sets a target of at least 8 percent annual economic growth, driven primarily by extractive industries, such as mining, hydropower and plantation agriculture. All these activities require significant land allocation, while slash-and-burn agriculture and logging further diminish forested areas. Trees once spread across 70 percent of Lao, but in 2010 the Department of Forestry estimated that this has now been reduced to just 40 percent."



9. AFGHANISTAN: Trade through western province on the up
Source: Institute for War and Peace Reporting

"Exports from the western Afghan province of Herat have leapt by over a third as a result of a relaxation of customs rules, better international trade links and improved security, businessmen said. Herat lies on ancient trade routes linking the Middle East with Central and South Asia, and borders on Turkmenistan as well as being Afghanistan's major gateway to Iran.

The province produces saffron, rugs, cumin, marble, animal skins and wool, and should be prospering. But as in much of Afghanistan, businessmen frequently complain that free trade is hampered by continued conflict, endemic corruption, poor government policies, and a lack of markets abroad. That situation is now improving, according to businessmen and officials, who credit a reduction in red tape and a supportive provincial chamber of commerce."



10. PHILIPPINES: Getting the most from 'coco-nomics'
Source: Inquirer

"The new world of 'coco-nomics' tells the Philippines -- the world's largest exporter of coconut -- to invest the P8.5-billion ($199 million) dividend from the coconut levy in economic health through the modernization of the industry geared toward emancipating farmers from poverty. Out of the entire population of about 350 million coconut trees, 46 million are aging and need to be replaced at a rate of 1 million seedlings a year.

As a tree of abundance, the coconut is underutilized. Out of a total harvest of 15 billion nuts a year, 90 percent goes to copra. The remaining 10 percent is not sufficient to meet the new emerging markets in coconut sugar, buko water and virgin coconut oil. If the Philippines can produce consumer-ready food products instead of exporting raw coconut products, the country can realize higher revenues. To accomplish this, the Philippines must meet global food safety standards and provide incentives to private entrepreneurs."



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