World’s top innovative nations

January 16, 2009

1. United States

The United States still rules the world when it comes to innovation. This is no surprise, as the US with a legacy of over 100 years in innovation, has been consistent in taking the leader’s slot. The US knows it must continue to innovate to stay ahead. It tops in three areas: human capacity, business markets and competitiveness. The five input pillars that are included in the GII are: Institutions and Policies, Human Capacity, General and ICT Infrastructure, Markets Sophistication and Business Sophistication. The input pillars define aspects of the conducive environment required to stimulate innovation within an economy. There are three output pillars which provide evidence of the results of innovation within the economy: Knowledge Creation, Competitiveness and Wealth Creation. The US scored high on both input (ranked 2nd) and output (ranked 1st) pillars.

2. Germany

Germany follows in second position, maintaining its position from last year. Germany scores relatively low on the input pillars (10th) and very high on the output pillars (2nd), leading to an overall second rank. It is important to note that that eight out of the top 10 countries in the list are from Europe. As global competition intensifies and innovation becomes more important, the business sector has been internationalizing knowledge-intensive corporate functions, including research and development, the study points out.

3. Sweden

Sweden rises to 3rd rank in 2008 year from 12th position in 2007. It’s important to provide a safety net to innovators, says the study. There must be a conducive environment for innovative companies. A ‘succeed or perish’ environment often kills innovative ideas in the nascent stages as people will be too intimidated to take creative risks that could fail.

4. United Kingdom

The United Kingdom fell from 3rd to 4th position in 2008. The study reflects that innovation is correlated with income levels in a country. For example, the innovation levels in the OECD (Organization for Economic Cooperation and Development) countries are much more than non-OECD countries. The high income countries do significantly better by topping innovation rankings. The average innovation index falls with the income levels of the country.

5. Singapore

Singapore rose to 5th rank in 2008 from 7th. Singapore is also 2nd from the Asian region. Innovation is not just about generating new ideas, says the study. It is about translating these ideas into value-added products and services. This requires flexibility of attitude and a willingness to adapt and welcome unprecedented levels of change on the part of all stakeholders involved, says the study.

6. South Korea

South Korea made a giant leap by grabbing the 6th rank, up from 19th position in 2007. Over the last two decades, the Republic of Korea has undergone a great change, with Information and Communication Technologies (ICT) and innovation becoming the power engine for its high economic growth. After facing a big financial crisis in 1997, Korea emerged into a powerhouse of knowledge through the consolidation of knowledge industries with the ICT industry itself contributing to more than 30 per cent of its total exports, the study states.

7. Switzerland

One of the world most beautiful places has also made it to the top innovative nations’ list. Switzerland is ranked 7th in the global innovative index. Innovation is the key driver of any economy. It works best when like-minded individuals come together in small collectives, irrespective of political and cultural differences and work on projects that yield value for all parties involved.

8. Denmark

While Denmark features among the top nations with an overall score of 5.73 along the different input pillars, it ranks relatively low at position 21st along the output pillars. This pulls the overall GII rank of Denmark down to 8th and raises questions as to why despite creating a highly conducive environment for innovation, it is not able to capitalize on it. The remarkable leadership and phenomenal development of the three Nordic countries of Finland, Denmark and Sweden have consistently done well in the development of institutions and policies that nurture innovation. Denmark tops the ICT and infrastructure pillar. Denmark also comes at top position in the 2008 Networked Readiness Rankings of the World Economic Forum.

9. Japan

The world’s industrial powerhouse Japan moved down to 9th position in 2008. It was ranked fourth in 2007. Ranked relatively lower along the input pillars (16th), Japan comes in at an impressive 3rd position along the output pillars. Clearly, Germany and Japan are able to leverage their less favorable innovation environments into more effective innovation results. The Japanese society is currently undergoing deep structural changes. Japan enjoys a competitive edge in business sophistication, innovation and R&D (research and development) spending. But its macroeconomic weaknesses have led to one of the highest debt levels in the world. People are also questioning the values of the political, economic and social institutions, and alternatives are being explored. This includes the fields of education, research and innovation as well. The government and the private sector give high priority to R&D spending.

10. Netherlands

The Netherlands with a prosperous economy is ranked 10th in the list. It is also the 16th largest economy in the world. A country’s readiness is linked to its ability to garner the best from leading-edge technologies, expanded human capacities, better organizational and operational capabilities and improved institutional performance, according to the study.


Best nations to do business

October 7, 2008

1. Singapore – Singapore kept its top ranking for the third year in a row as the easiest place in the world to do business. The Asian city-state edged out New Zealand and the United States in the ‘Doing Business 2009’ ranking. Along with Hong Kong, South Korea and Taiwan, Singapore is one of the Four Asian Tigers. Singapore’s economy depends heavily on exports refining imported goods, especially in manufacturing. Thousands of foreign expatriates work here in multi-national corporations. The city-state employs thousands of blue-collared workers across the globe.

2. New Zealand- New Zealand has a developed economy with an estimated nominal GDP of $128.1 billion as on 2008. The country has a very high standard of living. New Zealand’s service sector is the largest sector in the economy, followed by manufacturing and construction and the farming/raw materials extraction. New Zealand is heavily dependent on free trade, particularly in agricultural products.

3. USA- The American economy is under terrible stress at the moment.  A series of events in United States, including the collapse of Lehman Brothers and Bank of America agreeing to buy Merrill Lynch for $44 billion, has shaken up the global financial markets. There could be several more developments over the next few months that might make things more difficult. Thousands will lose their jobs in the global financial sector as many companies have witnessed the fastest drop in business levels, profitability and confidence in almost two decades.  Initial estimates say that the unprecedented crisis in the global financial services industry will lead to more than 250,000 jobs being lost globally. And economists say that this figure is ‘very conservative.’ The eventual number of jobs that will actually be lost could be much higher, they say. The fiscal hurricane that originated in the United States has soon spread panic and gloom across the world markets. European companies have already announced layoffs, while some Asian companies too have done the same. However, some relief came with the US Congress approving a revised $700 billion package to bail out the beleaguered financial sector of the country.

4. Hong Kong- Hong Kong is one of the world’s leading financial centers.  It is one of the four Asian tigers known for its high growth rate and rapid industrialization. The Hong Kong Stock Exchange is the sixth largest in the world, with a market capitalization of $2.97 trillion as on October 2007. It is an important centre for international finance and trade, with the greatest concentration of corporate headquarters in the Asia-Pacific region.

5. Denmark- Denmark has a GDP per capita higher than that of most European countries, and 15-20% higher than that of the United States. Denmark is one of the most competitive economies in the world according to World Economic Forum 2008 report, IMD, and The Economist. Denmark’s market economy features efficient markets, above average European living standards, and high amount of free trade. Denmark is home to many multinational companies. Among them: A P Moller-Maersk Group, Lego, Bang & Olufsen, Carlsberg, Vestas, Novozymes and the pharmaceutical companies Lundbeck and Novo Nordisk deserve special mention

6. Britain- The British economy is made up (in descending order of size) of the economies of England, Scotland, Wales and Northern Ireland. In the 1980s, during Prime Minister Margaret Thatcher’s tenure, most state-owned enterprises were privatized. The British government now owns very few industries or businesses — Royal Mail is one of the very few examples. In the post World War II period, the British economy recorded chronic weak growth. However, in recent years Britain has seen the longest period of economic growth. It has grown in every quarter since 1992.  It is one of the strongest EU economies in terms of inflation, interest rates and unemployment, all of which remain relatively low. The country’s GDP as of 2007, stands at $2.772 trillion.

7. Ireland- The economy of the Republic of Ireland is modern and trade-dependent with growth averaging a 7% per annum in 1995-2007. Agriculture, once the most important sector, is now dwarfed by industry, which accounts for 46% of GDP, about 80% of exports, and employs 29% of the labour force. Ireland has the second highest per capita income of any country in the EU next to Luxembourg, and fourth highest in the world based on measurements of gross domestic product per capita

8. Canada- Canada is one of the world’s wealthiest nations, and a member of the Organization for Economic Co-operation and Development and Group of Eight. As with other developed nations, the Canadian economy is dominated by the service industry, which employs about three quarters of Canadians. The country’s GDP as of 2007 stands at $1.274 trillion. Canada has a sizable manufacturing sector, centered in Central Canada, the automobile industry being especially important.

9. Austria- The economy of the Republic of Austria may be characterized as a social market economy similar in structure with that of Germany. In 2004 Austria was the fourth richest country within the European Union, having a GDP per capita of approximately Euro27’666, with Luxembourg, Ireland, and Netherlands leading the list. In the post World War II era, Austria has achieved sustained economic growth. In the crisis-ridden 1950s, the rebuilding efforts for Austria lead to an average annual growth rate of more than 5 per cent in real terms and averaged about four point five per cent through most of the 1960s.

10. Norway- The economy of Norway has shown robust growth since the start of the industrial era. Shipping has long been a support of Norway’s export sector, but much of Norway’s economic growth has been fueled by an abundance of natural resources, including petroleum exploration and production, hydroelectric power, and fisheries. Norway is among the most expensive countries in the world, as reflected in the Big Mac Index. Historically, transportation costs and barriers to free trade had caused the disparity, but in recent years, Norwegian policy with respect to labor relations, taxation, etc, have contributed significantly.


World’s busiest ports

July 2, 2008

India

Sea transport is the largest carrier of freight in the world. In India, Nhava Sheva International Container terminal (Jawaharlal Nehru Port) in Navi Mumbai handles the highest traffic in the country. The Nhava Sheva International Container terminal in Navi Mumbai (Jawaharlal Nehru Port) is the busiest port in India, handling nearly 60 per cent of India’s port traffic. Nhava Sheva is India’s first privately managed container terminal. Developed at a total cost of $250 million, the terminal handled around 1.5 million TEUs (twenty-foot equivalent unit — containers are counted in 20-foot lengths) in 2007-08. Currently it is managed by DP world under a build-operate-transfer agreement set up with the Jawaharlal Nehru Port Trust.

Singapore

The world’s largest container transshipment hub, Singapore, handles about one-fifth of the world’s total container shipment. In 2007, Singapore Terminals handled 27.1 million twenty-foot equivalent units (TEUS) of containers. The port of Singapore operates 4 container terminals and 2 multi-purpose terminals in Singapore, and links shippers to an excellent network of 200 shipping lines with connections to 600 ports in 123 countries.

Rotterdam, Netherlands

Rotterdam is Europe’s largest logistic hub. The port is the gateway to a European market of 450 million consumers. More than 500 scheduled services link Rotterdam with over 1000 ports worldwide. The port has a depth of 24 meters (75 feet). The port and industrial area stretches over a length of 40 kilometers and covers 10,000 hectares. Rotterdam is also Europe’s cheapest bunker port. One of the main advantages of Rotterdam is its location on the estuary of the rivers Rhine and Maas. This helps to transport goods economically to other regions in Europe.

South Louisiana

The Port of South Louisiana, which stretches 54 miles along the Mississippi River, is the largest tonnage port district in the western hemisphere. Over 4,000 vessels and 55,000 barges call at the Port of South Louisiana each year, making it the top ranked port in the US in terms of total tonnage.

Shanghai

The Port of Shanghai, located in the vicinity of Shanghai, comprises a deep-sea port and a river port. In 2006, with a total of 537 million tons of cargo transported, it became the world’s busiest port by cargo tonnage for the first time. The Port of Shanghai is situated at the middle of the 18,000km-long Chinese coastline and is an important gateway for foreign trade. The Port enjoys a good geographical location, modern infrastructure and facilities.

Hong Kong

The port of Hong Kong, located by the South China Sea, is a deepwater seaport dominated containerized products’ trade. The natural shelter and deep waters of Victoria Harbor provide ideal conditions for berthing and handling all types of vessels. It is one of the busiest ports in the world, in terms of cargo handled and passengers carried.

Houston

The Port of Houston is a 25-mile-long complex near the Gulf of Mexico. It is the busiest port in the United States in terms of foreign tonnage, second-busiest in the United States in terms of overall tonnage.

Chiba, Japan

The Port of Chiba is located centrally in Tokyo Bay. Its 133 km of coastline spanning six cities makes it the largest port in Japan. The Port of Chiba has seen one of the leading ports in Japan in terms of the cargo volume handled.

Nagoya, Japan

The Port of Nagoya is the largest trading port in Japan. It accounts for about 10% of the total trade value in Japan. It is also the largest exporter of cars in Japan. Toyota exports most of its cars through this port. A part of the port has been redeveloped as a leisure district. It offers an aquarium, shopping mall, amusement park, museums and green space

Ulsan, South Korea

Korea is located in the centre of the world’s trunk routes, including the North American route, the Southeast Asian route and the European route. The Port of Ulsan, located at the south-east corner of the Korean Peninsula is a natural port and a strategic trade centre.

Gwangyang, South Korea

The Korean government plans to promote Korea as the logistics hub of Northeast Asia. The total cargo traffic is expected to increase to 1.4 billion tones by the year 2011. Dongbu Kwangyang Container Terminal in Kwangyang Harbor offers lower usage charges and taxation benefits.


World’s top business centers

June 12, 2008

According to a study titled ‘MasterCard Worldwide Centers of Commerce Index, the following are the top business centers of the world. All the cities have been rated on seven different parameters, including legal and political framework, economic stability, ease of doing business, financial flow, business centre, financial flow, knowledge creation and information flow and livability, MasterCard said.

#1: London

At rank 1, London reigns supreme among the top commercial cities of the world. London scores highest in the financial flow, knowledge creation and information flow. London is also ranked high in the business centre criteria. It is ranked 3rd in terms of ease of doing business and 9th in legal and political framework. London did not fare as well in livability criteria (rank 24th), and economic stability (rank 20th). A strong economy and a vibrant financial market are its strengths.

#2. New York

New York ranks second in the list of top global business centers. These global cities connect markets and commercial activity across the world. New York is ranked top in North America. It beats London in the legal and political framework dimension and economic stability and livability. New York, however, ranks lower in financial flow and business center dimension.

#3. Tokyo

Tokyo ranks third in the list of top ‘Worldwide Centers of Commerce’. More and more Asian cities rapidly growing attracting big business and a place in the global business world. Tokyo scores very well in the dimensions of financial flow, business centre, livability and knowledge creation and information flow where also it was ranked 3rd. However, Tokyo scored considerably lower than London and New York in legal and political framework, economic stability and ease of doing business

#4. Singapore

Singapore ranks fourth in the list of top business centers. Two Asian cities top the list in terms of ease of doing business. Singapore tops with an index value of 82.82 and in terms of business centers, Singapore is ranked at the third spot with an index value of 62.58.

#5. Chicago

Chicago ranks fifth in the list of top business centers in the world. In terms of knowledge creation and information flow, Chicago ranks among the top 10. More universities, MBA programmes, research institutions and numbers of researchers drive this dimension of knowledge creation.

#6. Hong Kong

Hong Kong ranks sixth in the list of top commercial centers. In terms of ease of doing business, Hong Kong is ranked second with an index value of 80.37. Cities in Asia were not generally major centers of commerce in the second half of the 20th century, with the exception of Tokyo and subsequently Hong Kong and Singapore.

The very strong rise of Shanghai in the 2008 Index reflects the equally spectacular rise of China. While Shanghai was likely the dominant Asian commercial centre before World War II, it faded for many decades until China’s economic reforms of the 1980s catapulted it back to global prominence, the report states.

#7. Paris

Paris ranks seventh among top global business centers. In Europe, it ranks at No. 2 after London. With a score of 79.17, London tops the list in Europe also but there is a big gap between it and other cities, Paris has a score of 63.87 and Madrid has a score of 58.34.

#8. Frankfurt

Frankfurt has slipped to No. 8 among the world’s top commercial centers. It stood in the seventh spot in 2007. The city ranks at No. 3 among European cities.

#9. Seoul

Seoul ranks ninth among the world’s top financial centers. The booming Chinese and Indian economies reflect the economic power to Asia. The strong presence of Asia/Pacific, Middle East and Africa cities is further evidence of the growing influence of the region not just in manufacturing and services, but also in broadly based commercial strength, the study said

#10. Amsterdam

Amsterdam ranks tenth among the list of top commercial centers in the world. It ranks among the top ten in legal and political framework. It also ranks high in the business centers criteria and economic stability.


What you MUST know about Inflation

March 31, 2008

“Inflation is when you pay fifteen dollars for the ten-dollar haircut you used to get for five dollars when you had hair.” — Sam Ewing.

“Inflation and credit expansion, the preferred methods of present day government openhandedness, do not add anything to the amount of resources available. They make some people more prosperous, but only to the extent that they make others poorer.” – Ludwig von Mises.

Everyone is facing the brunt of rising prices. Prices of all essential commodities are rising not just in India but across the world due to a fall in supply. Inflation has spiralled all over the world. With India importing food items, it is only adding more woes to the people.

The Indian economy is also facing a slowdown. The markets have also shed huge gains — March 25 was a sort on anomaly — taking a cue from global meltdown. Industrial production has slowed down, further decelerating the economy. There were risks from turbulence on global financial markets and from rising oil, metals, and wheat and rice prices worldwide. The rise in Inflation is a matter that causes worry to any government. When inflation is on the rise, all of us should be concerned.

What is inflation?

“Inflation is the most regressive form of taxation because it hits the poor the most.”-Narendra Jadhav, Vice Chancellor, University of Pune.

 Inflation is a rise in the prices of a specific set of goods or services. In either case, it is measured as the percentage rate of change of a price index. Food prices are soaring . . . all essential items like vegetables, oil, milk, sugar are getting costlier. Rentals and real estate rates have almost doubled in just a few months in most cities. The real estate prices are at record highs making life miserable, especially for people who have migrated to cities for jobs.

Why inflation hurts us badly

“Inflation is bringing us true democracy. For the first time in history, luxuries and necessities are selling at the same price.” — Robert Orben.

Inflation hits you badly as prices are rising. You end up spending more money for things that you could buy for les earlier.

What you could buy for $ 100, a few years ago, would now cost you nearly double. As a result, your savings will come down. As prices rise, the purchasing power of money goes down too. So to fight inflation, you must always invest money wisely. When you invest money, you must be careful about the return on your investment. The return on your investment must always be higher than the rate of inflation. You may have got a good pay hike, but were you able to save the extra cash? Well, if inflation is high, you end up spending more money so in effect the hike makes little sense. A high inflation rate negates the salary hike you have received.

Inflation reduces the purchasing power of your money. It hits retired folk and people with fixed incomes very badly. Inflation destabilizes the economy as consumers and investors change their spending habits. People tend to spend less when prices are up as a result production slows down resulting in job losses as well. Inflation also affects the distribution of income. Lenders and borrowers are also hit. Experts say a little inflation is good for the economy. It keeps the economy active as the prices of goods keep changing. In the short term, it encourages spending and borrowing and also encourages long term investments.

How inflation hits you

“The first panacea for a misguided nation is inflation of the currency; the second is war. Both bring a temporary prosperity; both bring a permanent ruin. But both are the refuge of political and economic opportunists.” — Ernest Hemingway.

Economists attribute inflation to a demand-pull theory. According to this, if there is a huge demand for products in all sectors, it results in a shortage of goods. Thus prices of commodities shoot up.

Another reason for inflation is the cost-push theory. It says that labor groups also trigger inflation. When wages for laborers’ are increased, producers raise the prices of products to make up for salary hike. The rising prices of food products, manufacturing products, and essential commodities push the inflation rate further.

Spiraling global crude oil prices have worsened the situation. Sometimes, banks create more liquidity by allowing more loans for people, giving them the purchasing power to buy more, as a result of which prices are driven up further. The demand-supply gap also drives inflation rates.

How is inflation calculated?

“Inflation is taxation without legislation.” Milton Friedman.

India uses the Wholesale Price Index to calculate and then decide the inflation rate in the economy. Most developed countries use the Consumer Price Index to calculate inflation. WPI is the index that is used to measure the change in the average price level of goods traded in wholesale market.

 In India, data on a total of 435 commodities’ prices is tracked through WPI which is an indicator of movement in prices of commodities in all trade and transactions.

CPI is a measure of a weighted average of prices of a specified set of goods and services purchased by consumers. It is a price index that tracks the prices of a specified basket of consumer goods and services, providing a measure of inflation.CPI are a fixed quantity price index and considered by some a cost of living index.

Many economists say that India must adopt CPI to calculate inflation as CPI measures the increase in price that a consumer will ultimately have to pay for. United States, the United Kingdom, Japan, France, Canada, Singapore and China use CPI to measure inflation.

WPI does not measure the exact price rise consumers will experience because; it is calculated at the wholesale level.

Another issue with WPI is that more than 100 out of the 435 commodities included in the Index are no longer important for consumers. Even commodities like livestock feed are considered to measure the WPI. In India, inflation is calculated on a weekly basis.

Types of inflation

“Inflation is like sin; every government denounces it and every government practices it.” Frederick Leith-Ross .

 There are different types of inflation:  

 Deflation: It refers to a general falling level of prices. 

 Disinflation: This is a decrease in the rate of inflation.  

Hyperinflation: When prices zoom and inflation goes out-of-control, it is called hyperinflation. 

 Stagflation: It is a combination of inflation, rising unemployment and stagnation in the economy.  

Reflation: This refers to move to hike prices to fight deflationary pressures.


Flowers Named After People

March 20, 2008

Many Flowers are named after the people who introduced them. The bougainvillea, for example, was named after French admiral, Louis de Bougainvillea, who discovered the vine growing in Brazil during a long journey to the Pacific Ocean in 1768.

Narcissus, in Greek mythology, was a handsome youth who disdainfully spurned the love of the nymph Echo. The goddess Aphrodite punished him by making him fall in love with his own reflection in a pool. Unable to possess the image in the water he pined away and become the flower that now bears his name.

The marigold that is woven into garlands for pujas was earlier called Mary’s Gold after Virgin Mary.

Begonia was named after Michel Begon, a governor of French Canada, while Zinnia got its name from Hohann Gottfried Zinn, a professor of botany in Gottingen, Germany.

The Marilyn Monroe rose is an apricot colored hybrid rose. It was named after the popular actress of the last century, Marilyn Monroe.

Julie Andrews is the name of a coral-salmon hybrid rose. It was named after actress Julie Andrews of The Sound of Music and Mary Poppins fame.

The Netherlands named a special variety of Tulip after Bollywood beauty and former Miss World Aishwarya Rai, in 2005.

The Singapore government named a rare species of orchid Ascocenda Shahrukh Khan after Bollywood superstar, Shahrukh Khan. The Big B also has an orchid named after him. It’s a light brownish orange orchid with a pale yellowish green and red centre. It was named Dendrobium Amitabh Bachchan. The unusual orchids grow alongside orchids named after Princess Diana and Queen Elizabeth in Singapore’s Botanical Garden.