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The global plastic problem – Modern Diplomacy

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The global plastic problem - Modern Diplomacy
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Global plastic pollution is becoming increasingly severe. According to a report by the German weekly magazine ‘Focus‘, plastic particles have recently been found in samples collected all over the world, : from the Arctic to rivers and even deep seas.

Even Mount Everest, the top of the world, has been found to contain plastic particles. The United States has long accused developing countries of being the main responsible for plastic pollution. The waste approach has overshadowed the U.S. “major contribution” to the plastic pollution crisis. If we also consider the export of plastic waste and the latest statistics on illegal dumping and littering, the United States is one of the most severe sources of plastic pollution in the global coastal and marine environment, ranking third in the world.

The research report published by Science Advances clearly states that the United States blames Asian countries for the plastic waste pollution problem, although it is the world’s largest producer of plastic waste. The report was written in collaboration with scholars from the American Association for Marine Education, the University of Georgia and the National Geographic Association.

The Comprehensive Assessment Study on Global Plastic Waste Issues, published in 2015, stated that the top five countries producing most of the plastic waste are China, Indonesia, the Philippines, Vietnam and Thailand.

The latest report, however, finds that the 2015 study ignored any mismanagement of waste after it had been exported to another country for recycling.

The research report also revised the 2015 claim that China is the world’s largest emitter of marine plastic waste.

The latest research report published by Science Advances calculated the total amount of plastic waste generated by countries around the world in 2016, based on waste generation and characteristic data from 217 countries and regions reported by the World Bank.

Global plastic production in 2016 was 422 million tonnes, with a 26% increase as against 2010. The share of plastics in solid waste rose from 10% to 12% in 2010. In 2016, global plastic waste generation reached 242 million tonnes.

The report clearly states that in 2016 the United States was the country that produced the largest amount of plastic waste (42 million tonnes). It also ranked first in terms of annual per capita production of plastic waste (130 kilograms).

The 28 EU Member States ranking second produce 54.56 kilograms of plastic waste per capita per year, which is only half of the United States’ plastic waste, while India ranks third. In 2016 China ranked fourth in terms of plastic waste production (21.6 million tonnes), equivalent to half the U.S. amount, but its annual plastic waste production per capita was only 15.67 kilograms, equivalent to only 12% of the amount produced by the United States.

Nick Mallos, senior director of the Marine Conservation Organisation’s Garbage-Free Ocean Program, stated: “The plastic waste generated in the United States is the largest amount of any country, but we have been ignoring the problem, outsourcing it to developing countries. And we are making a heavy contribution to the plastic crisis in the oceans”.

In terms of rubbish, illegal dumping, littering and other improperly managed waste products on the coast, the United States ranks third among coastal countries and is the main cause of pollution in the world’s coastal areas.

The study also said that the United States collected 3.91 million tonnes of plastics in 2016, more than half of which was shipped overseas, and exported 1.99 million tonnes of plastic waste to 89 trading partners. “Over 88% of plastic waste is exported to countries that cannot properly manage and dispose of it due to insufficient resources.” Much of this exported plastic waste cannot be reused, which will eventually pollute the local environment.

One of the authors of the research report, oceanography professor Cara Lavender Law, stated: “For several years, many of the plastic products we throw in the rubbish can be exported to countries where it is already difficult to manage their own waste for recycling. Not to mention the large amount of plastics shipped from the United States. Considering the large amount of our plastic waste that is actually non-recyclable because it is of low value, contaminated or difficult to dispose of, it is not surprising that a lot of plastics will end up polluting the environment”.

Relevant data show that 5% of plastic waste generated in the United States is discarded or dumped illegally due to “improper handling and management” or cannot be disposed of properly after being transported to other countries.

The report underlines that it seems that only 5%is “improperly managed” but, considering the total amount of plastic waste, this figure cannot be ignored.

It should also be stated that eight million tonnes of plastics enter the oceans every year, which is equivalent to a plastic load being spilled into the sea every minute.

These plastic products have undertaken a long and destructive journey from the moment they have reached the sea. Winnie Liu, a senior official with The Pew Charitable Trust’s Marine Plastics Prevention Project, said: “Plastics reaching the seas will be carried far away by ocean currents. They are found all over the world, even on the edge of Antarctica and the deepest place on earth. Plastics can be found in the Mariana Trench. As they drift with currents, theywill penetrate the ecosystem and cause immeasurable damage to marine life”.

Despite the severity of this problem, global plastic production continues and is posing increasing threats to the seas. What makes the oceans so vulnerable to plastic pollution? How can we control the plastics entering the ocean? What is wrong with plastics?

In our daily lives we can hardly avoid plastics. From food packaging to toiletries, clothes, furniture, computers and cars, plastics is everywhere. Plastics durability makes it difficult to biodegrade them. In a way, it can be compared to long nuclear decay.

Depending on their type, some plastics can take decades or even millions of years to decompose in landfills. Therefore, unless plastics are incinerated (a process which, in turn, causes pollution), virtually all the plastics we have produced so far still exist in the world and, once entered the ocean, their impact will last for hundreds of years.

Where does waste come from? The world produces over 300 million tonnes of plastic waste every year, and this amount is still growing. Only 9% of this plastic waste is recycled. The rest is incinerated or discarded. Most of the discarded plastic waste is landfilled. The reason for this is that half of the plastics we produce is disposable plastics, i.e. plastic products such as straws, plastic bags and water bottles that are thrown away after they have been used.

It is precisely because disposable plastics are easy to produce and discard, and lead to a continuous increase in the amount of waste landfilled, that they inevitably increase the amount of plastic waste polluting the environment.

Why is the impact of plastics on the oceans so severe? The vast and deep oceans are like a retention tank for pollutants, which collects toxic material from all over the world. Besides the load dropped from ships, plastic fishing nets and longlines (known as ‘ghost fishing gear’) are also a major source of plastic waste in the oceans, accounting for about 10%. In addition, expanded polystyrene used in aquaculture to make cages is also a source of marine plastic pollution.

The vast majority of marine debris, however, comes from the land. Extreme weather conditions and strong winds sweep waste along the coast, which is quickly picked up by the tide. Oceans are also the final destination of thousands of rivers, carrying large amounts of waste from landfills, and eventually sinking it into the sea.

Once plastic waste enters the ocean, it is broken down into particles with a diameter of less than 5 mm, called microplastics. This happens because of the harsh conditions and endless ocean movements.

This form of plastics will spread ever deeper into the ocean. It will invade more biological habitats and cannot actually be recycled at all. What will happen to us if also thousands of marine animals get caught in plastic waste every year, especially ‘ghost fishing gear’? Furthermore, the harm to marine life from ingesting plastics is less evident: seabirds, sea turtles, fish and whales often mistake plastic waste for food because its colour and shape are similar to their preys. We end up eating them. Once we ingest these toxic particles, our organs will be damaged, thus making us more liable to diseases. Our fertility will also change, with great risks of genetic mutations.

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A Labour Government Should not Frighten the Horses

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The UK general election is likely to mean changes, but Gulf citizens need not be too worried.

By James Drummond

If the tension was killing you, now you know. If it wasn’t, then be aware that a general election in the United Kingdom will be held on July 4 – less than six weeks away.

For the hapless Rishi Sunak, it looks like a case of “If it were done when ’tis done, then ’twere well it were done quickly.” Polls indicate that after 14 years of conservatism, real or imagined, voters are likely to elect a new Labour government.

What does this mean for us here in the Gulf?

The six Gulf states are certainly exposed to Britain. The extent of GCC holdings in the UK is enormous, ranging from Qatari ownership of the Shard building in London, stakes in the Sainsburys supermarket chain and Barclays bank, to Sheikh Mohammed bin Rashid’s Godolphin stables in Suffolk.

Manchester City and Newcastle United football clubs are owned by Emirati and Saudi interests, respectively. Kuwait’s wealth is managed by the Kuwait Investment Office near St Pauls Cathedral.

Labour has been careful to detail very few policies (or hostages to fortune, as its strategists may see it), but last week, David Lammy, the likely new foreign secretary, outlined a further campaign against dirty money.

Britain is a “corruption services centre”, while London is a “hotbed of kleptocracy”, Mr Lammy said. He said that he wanted to reward whistleblowers and clamp down on “enablers” of financial crime.

Given the paucity of public announcements, Lammy’s speech is significant, because it implies that the incoming government is likely to act. Fighting financial crime is relatively uncontroversial and attracts cross-party support – although in the UK’s case with limited success.

British politicians have made similarly grandiose statements before. But after Russia’s invasion of Ukraine, London has moved particularly against Russian dirty money, and sanctioned individuals. It finally introduced an obligation mandating the disclosure of beneficial owners of property.

Overseas trusts are also now required to disclose their ultimate beneficial owners, and there is now greater transparency when registering entities at Companies House.

This seems to have had only limited effect, however. Last week Andrew Mitchell, the deputy foreign secretary, cited estimates that 40 percent of the world’s dirty money still passes through London.

Spotlight on Corruption, a non-governmental organisation, wrote in October last year that “major reform is needed to how lawyers and accountants, the property sector and company formation agents are regulated for money laundering.” Lammy may choose to take further action against these and other professionals.

Other so-called enablers include retired politicians, some of them in the House of Lords, who work as advisors to unsavoury actors. Labour could move to tighten disclosure, although several of its senior former members are likely to lobby against further transparency.

It is also possible that Labour will go further in taxing expatriates. In its limited public commitments, the party has promised to clamp down on “tax dodgers”.

Those with property in the UK already pay tax on rental income they receive, and worldwide assets are subject to Britain’s inheritance tax. Some Gulf Arab families with UK property have been caught by inheritance tax.

A government led by Sir Keir Starmer, the Labour leader, could go further, as the US does, in taxing worldwide income of its citizens, more than 200,000 of whom live in the UAE alone. The argument is that if you have the privilege of carrying the passport, you have an obligation to pay tax.

Another question surrounds nationalisation. Labour is committed to re-nationalising the railways for one, although the infrastructure is already under central government control.

But another target may – may – be England’s water supply network, which was privatised in 1989. Shareholders in various of the rump companies include the Qatar Investment Authority and Adia of the UAE.

The water companies have been the subject of a vociferous campaign, for allegedly paying their shareholders high dividends while neglecting maintenance and investment. It is possible that an incoming Labour government will nationalise the industry.

All that said, the primacy of the rule of law and respect for property rights remain strong in Britain.

Barratt, a mass housebuilder, reported earlier this week that London remains the top choice among world cities for UAE investors looking to buy overseas. The holdings of Gulf states and rights of Gulf citizens in the UK remain secure, even with a Labour government.

James Drummond is Editor-in-Chief of the AGBi

Courtesy: The AGBI.Com


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Kuwait’s Political Crisis Adds to Economic Uncertainty

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Kuwait’s latest standoff is deeply concerning for both the near and long term, writes Andrew Cunningham

The decision by Kuwaiti emir Sheikh Mishal Al-Ahmad to dissolve the country’s recently elected parliament just days before its inaugural session on May 14 presents overseas investors and Kuwaiti citizens with more uncertainty.

The situation raises concerns about the country’s economic prospects over both the short and long term.

Disputes and stand-offs between Kuwait’s emirs and its boisterous parliament are nothing new. Parliament has been dissolved, and the constitution suspended, numerous times over the past 40 years. The country has held four elections in the past four years.

Squabbling between the two sides is rooted in political disagreements and this most recent outbreak is no different.

A major factor behind the latest dissolution is believed to have been parliament’s objection to Sheikh Mishal’s choice of crown prince. Although the crown prince is nominated by the emir, the appointment has to be ratified by the parliament.

But these political, and sometimes personal, disputes have real consequences for Kuwait’s economy and financial system and, ultimately, for the long-term welfare of its citizens.

Kuwait is a prosperous country. If we take a snapshot today, we see it producing nearly 2.5 million barrels of oil per day (bpd), and there are plans under way to increase production capacity to 4 million bpd by 2035.

State foreign reserves are around $930 billion, according to National Bank of Kuwait, the country’s largest bank. With a population of a little over 4 million, its GDP per capita is one of the highest in the world.

Squabbling between the two sides is rooted in political disagreements and this most recent outbreak is no different.

A major factor behind the latest dissolution is believed to have been parliament’s objection to Sheikh Mishal’s choice of crown prince. Although the crown prince is nominated by the emir, the appointment has to be ratified by the parliament.

But these political, and sometimes personal, disputes have real consequences for Kuwait’s economy and financial system and, ultimately, for the long-term welfare of its citizens.

Kuwait is a prosperous country. If we take a snapshot today, we see it producing nearly 2.5 million barrels of oil per day (bpd), and there are plans under way to increase production capacity to 4 million bpd by 2035.

State foreign reserves are around $930 billion, according to National Bank of Kuwait, the country’s largest bank. With a population of a little over 4 million, its GDP per capita is one of the highest in the world.

In March this year, rating agency Fitch described Kuwait’s fiscal and external balance sheets as among the strongest of any of the governments it rates.

But when we look at long-term trends, the picture is more complex and less secure.

Kuwaiti government spending remains overwhelmingly dependent on oil and gas revenues. The government has made almost no progress, over many decades, in diversifying the economy away from oil, or in reducing the huge burden of government salaries and welfare payments.

Oil and gas revenues currently account for nearly 70 percent of total income and, according to IMF projections, will continue to do so for the rest of the decade.

These revenues have served the country well in the past, despite the volatility of oil prices, but such overwhelming dependence looks foolhardy when consumers worldwide are striving to reduce consumption of oil and gas and investors and energy firms have pivoted towards renewables.

Nearly all of the Kuwaiti government’s non-oil and gas revenue arises from overseas investments and from dividends from state-owned companies. Tax revenues account for less than 1 percent of total government income.

Looking beyond the fiscal imperative to diversify the economy is the need to provide employment opportunities for Kuwaiti citizens.

No less than 84 percent of the Kuwaiti workforce was employed by the government at the end of 2022. It is hardly surprising that nearly half of government expenditure is allocated to the salaries of public employees.

Pressure for social spending will increase in the years ahead. A World Bank report, published last year, showed that levels of obesity and Type 2 diabetes were higher in Kuwait than in any of the other GCC countries and nearly double the average in OECD countries.

Partly as a result of this, the World Bank estimated that Kuwait’s old age dependency ratio – the number of people over 65 years old in relation to those of working age – will be nearly double that of its neighbours by 2040.

Kuwait is also a country that is being significantly affected, even today, by climate change. Temperatures during the summer can exceed 50 degrees, making Kuwait one of the hottest places on earth.

These are difficult and complex challenges, both economic and social, but they are hardly unique to Kuwait. That they are, in some cases, more acute in Kuwait than elsewhere is due to decades’ long procrastination and political paralysis.

The government’s General Reserve Fund, which held most of its liquid assets, was entirely depleted in September 2020, according to Kuwait’s own ministry of finance. With AA ratings, the obvious solution was to borrow money – Kuwait’s debt-to-GDP ratio is less than 5 percent. Yet the parliament has still not passed a so-called ‘Liquidity Law‘ that would allow modest issuance of foreign currency debt.

The parliament also held up the introduction of Value Added Tax (VAT), making Kuwait one of two of the six GCC countries not to fulfil a joint commitment to implement a minimum VAT of 5 percent.

Over the past four years, all three of the big international credit rating agencies have downgraded the government of Kuwait.

In their rating reports, all agencies cited a dysfunctional and slow-moving political environment that was reducing the country’s financial flexibility and delaying much needed economic and financial reform.

Politics matters.

It is unrealistic to think that after decades of enmity the ruling family and the parliament will soon form a harmonious working relationship.

But they do need to find some common ground that will enable them to start addressing fundamental economic and social issues while the country still has large financial reserves and strong credit ratings.

Time is running out.

Andrew Cunningham writes and consults on risk and governance in Middle East and sharia-compliant banking systems


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ICD and JSC Ziraat Bank Collaborate to Boost Uzbekistan’s Private Sector

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At the 3rd Tashkent Investment Forum, the Islamic Corporation for the Development of the Private Sector (ICD) and JSC Ziraat Bank Uzbekistan took a significant step forward in their partnership to empower small and medium-sized enterprises (SMEs) and foster economic growth in Uzbekistan. The forum, held in the capital city of Uzbekistan, brought together key stakeholders from the public and private sectors to discuss investment opportunities and economic development strategies for the region. The collaboration between the Islamic Corporation for the Development of the Private Sector (ICD) and JSC Ziraat Bank Uzbekistan is aimed at boosting the private sector in Uzbekistan.

During the forum, ICD and JSC Ziraat Bank Uzbekistan formalized an expression of intent to collaborate on various initiatives aimed at supporting SMEs. One of the key elements of this collaboration is the provision of a Line of Financing (LoF) facility by ICD to JSC Ziraat Bank Uzbekistan. This LoF facility will enable the bank to fund private sector projects as an agent of ICD, thereby providing SMEs with access to the necessary capital to initiate and grow their businesses.

The partnership between ICD and JSC Ziraat Bank Uzbekistan is expected to have a significant impact on the SME landscape in Uzbekistan. By equipping entrepreneurs with the resources they need to succeed, this collaboration will not only support the growth of individual businesses but also contribute to the overall economic development of the country. SMEs play a crucial role in driving economic growth, creating jobs, and fostering innovation, and this partnership will help strengthen the SME ecosystem in Uzbekistan.

JSC Ziraat Bank Uzbekistan, as a strategic partner for ICD, brings a wealth of experience and expertise to the table. As a prominent commercial bank with foreign capital, JSC Ziraat Bank Uzbekistan has a strong track record of supporting SMEs and promoting economic development. The bank’s partnership with ICD further underscores its commitment to advancing the private sector in Uzbekistan and its dedication to supporting the country’s economic growth.

ICD, for its part, is a leading multilateral development financial institution that focuses on supporting the economic development of its member countries through the provision of finance and advisory services to private sector enterprises. By partnering with JSC Ziraat Bank Uzbekistan, ICD is furthering its mission of promoting economic development and fostering entrepreneurship in Uzbekistan and across the Islamic world.

The LoF facility provided by ICD to JSC Ziraat Bank Uzbekistan is just one example of the many initiatives that the two entities are undertaking to support SMEs in Uzbekistan. In addition to providing financial support, the partnership between ICD and JSC Ziraat Bank Uzbekistan will also include capacity-building initiatives and technical assistance programs to help SMEs succeed in today’s competitive business environment.

Overall, the partnership between ICD and JSC Ziraat Bank Uzbekistan represents a significant step forward in supporting SMEs and fostering economic growth in Uzbekistan. By working together, these two institutions are helping to create a more vibrant and dynamic private sector in Uzbekistan, which will ultimately benefit the country’s economy and its people. The collaboration between the Islamic Corporation for the Development of the Private Sector (ICD) and JSC Ziraat Bank Uzbekistan is expected to have a far-reaching impact on the private sector in Uzbekistan.


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