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Libyan Writer Ghoma

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Thursday, 8 November, 2007

THE KIDS' PIGGY-BANK AND THE FUTURE FUND...?

By: Ghoma


        The clumsy regime started thinking about the future! Or so it wanted Libyans to believe. Hello! Anybody home? The erratic regime and its deficient bureaucrats are now concerned about the future of Libyans! Where was the regime all these years when they mismanaged anything they could put their hands on and screwed up badly the past as well as the present? How this sudden awareness got into their noggins, which, from all signs must be either retarded or brain-damaged -consisting mostly of a bunch of thieves, opportunists, careerists, and whatnot- who, on taking control of the country's resources have not hesitated to so misuse and squander them to the brink of collapse? After all these years when the regime was acting as if the meager resources of Libya were not limited and dwindling -faster than their learning curve- but rather plentiful and continuously renewing? Just because the jackpot has hit the $90+plus mark doesn't meant it'll stay there! Or there's more to it? Why one has to believe them now that so suddenly they've gotten serious -not to talk about conscientious- to do anything about the future when, in fact, they've blundered and plundered the past and couldn't handle the present and deal with it in a responsible way?

        A starting fund of $40 billion dollars has been set aside to be invested in worldwide ventures for the future generations of Libya! On the face of it seems to be a good idea. An altruistic gesture meant to share, in the only resource the country has, with future generations to come. But here are the caveats: first, the idea was neither original nor new! Other oil-exporting fiefdoms have done this for quite some time now: notably Kuwait, U.A.E., and perhaps some others as well. And second, without an independent and separate body, from the regime, to handle and supervise the fund, for all intents and purposes, this fund -and all funds- has nothing to do with the 'future generations,' but rather, it's of the state, by the state, and for the state.

        Even if we give, those people in the regime, the benefit of the doubt, and assume such a venture would make some sense, better say, than the Colonel squandering the money on some of his fanciful never-never dreams to become the big Kahuta of 1000-plus tribes of the Dark Continent, all the odds, variables, taken together are still, if not completely against it, are slimly in its favor! Libya, a small country, without muscles to flex or sharp teeth to defend its money or interests, such as world-class navy, air-force, cruise missiles, atomic bombs and powerful reliable allies, is making a big jump and a huge leap of faith in taking undue risks by relying and trusting world-markets with its savings. Because, in addition to being a weak state, the world markets are not immune from being as volatile and vulnerable as the ether that carries their virtual gains. In putting its eggs in someone's else's basket(s), Libya has but one choice left: to safeguard its investments! That's, to not offend any of the powers, where the money is and hold sway on it. Since these powers have repeatedly shown their disregard for the so-called 'international norms' of respecting other nations'deposits and investments, and have not hesitated to put their hands on the assets at their disposal, whenever they felt any of these countries, has behaved differently than expected of it. Indeed the West has a long history of economic and otherwise harassments and blackmailing to the rest of the world. The habit of freezing other people's assets is only one of them. The West has never shied away from using all the tools available at its disposal to put pressure and punish small and weak countries, as Libya, to change what they feel its out-of-whack behaviors. Thus Libya, if it's not already there, has to descend to the level of those tribes with flags: does what the Gulf-states have been doing since they came into existence, which is to accept the protectorate's status! Libya has to forgo being a sovereign state and kowtows to the line thrown at her way to follow.

        If Libya is in such a bind, is it worth for the country to sacrifice its dignity and sovereignty (independence) for the sake, so to speak, of securing some of its 'livelihood'? It's a difficult choice! One can make a case of accepting the bad to avoid the worse. It isn't helping, however, the absence of clear and reachable short-term objectives and long-term goals, have only plunged the country into a whirlwind, dizzy without a compass to orient itself is groping its way in the darkness. The regime appears to heading back to square one, trying to figure out what model, of development, to follow. However, this endeavor is hampered by, contrary to the wisdom of a long dead Greek historian, a not banal factor, that is brains and creativity are still in short supply in the desert. It is becoming clearer every day! From all the world's experiences and history, the country couldn't find any other model except the one(s) so long has been mocking and ridiculing. What else, except to follow a model, which presumably was not born out indigenous talent but was rather sold to the Gulf states, that of the neo-colonial and consumerist economy. That may also explain, in the case of Libya, the helter-skelter and ad hoc nature with which priorities in allocating resources and investing the 'surplus' are being handled. The irony, if not the tragedy, a country of 6-million souls, and will double in about 20-year period, is not able to come up with something better than what few tribes have done. The fact of the matter, the Gulf has -and is- no model to imitate! No matter how much windfall money they may pile, the Gulf 'countries,' for some obvious reasons and others less so, couldn't and will not be viable states in the foreseeable future.

        If it's understandable some 'countries' which lack almost everything -with nothing to their names except a tribe and a flag and with a lot of oil under their feet- have to forgo investing the windfall money into their own lands and peoples and instead put it on the financial markets to finance other countries' stock-markets and investment demands, it's not the same for a country with the size and problems of Libya. For, it doesn't make a whole lot of sense when Libya goes begging for foreign capital and in the same time exports its own surplus outside of its territory? Why someone else would put his/her money in a country its government doesn't trust with its own money? How that would convince investors that Libya is a good place to invest in when its own government seems to plunt? And who came up with such an insidious and rotten idea to start with?

        If there's a one characteristic distinguishing, the so-called neo-colonial economy is that of being not an economy at all. A bunch of people consuming with no production! Does such scenario fit Libya? A country completely dependent on others for everything! A country with no viable infrastructure nor agriculture or industry and still siphons whatever little valuable hard currency it has to the rest of the world. It doesn't even have the capacity to absorb the revenues obtained from selling the raw materials, foreign companies are abstracting day and night and putting on the world's market! Nor, it seems, is willing or able to regulate these companies' abstracting capacity to the country's pace of development and need for hard-currency.

        Libya needs a lot of cash! To make, a viable the place to live in. Hundreds and hundreds of billions and even trillions are needed to fix it. Thus $ 40 billion dollars and even one trillion dollars are still puny sums, compared to the amounts required to build the country and put it on a take-off mode. A $40 billion sum isn't enough even for the higher education and wouldn't fix this sector to world standard levels, let alone the primary and secondary education. Beside education, there're all the other sectors of the economy and the services that go with them. So why, instead of investing the money inside the country, the regime has decided to export it? Perhaps, because the country lacks economic and manpower capacities to make use of the money? Or, maybe the regime never gave a serious thought to development and wanted only to create some sort of cover, a smokescreen, for its corrupted habits? Is it another account for the rainy day, so to speak, to double and even treble insure there'll always be a milking-cow for its voracious and corrupt officials to turn to if one day luck goes south and things get sour? The regime has survived long enough to know that if the present is in doubt, the future is not viable either. For $40 billion is not big enough to do much for the future of millions and millions of humans who will be roaming the deserts to forage! Libya with no-good soil nor water or skills, the future of its huddling masses will be no different from what we see in the rest of Africa, if not worse. Unless the future of these people starts today by investing, this sum and any other sums that can be pinched off of the fat and not-so-fat cats, and put into their education, training, and preparation so that they can compete with the best world has to offer.

        Libya is in a fix, if not in a quandary? It's in an uphill battle if not catch-22 trap type! How could present generation assume its responsibilities when it's badly prepared? There's no way in the world to prepare, for instance, a good physician in a school of medicine with 11,500 students, when labs and equipment were meant to meet the needs of a fraction of the number of students enrolled. The same for the other fields and professionals' training. With such deficits Libya could spend hundreds of billions and still needs more to fix what it badly has started in haste and without due planning. Higher education, as well as lower education, just to take one, is in dire need of serious considerations, from the premises to the finalities. What's the purpose of education in general and higher education in particular? If the world's economies are becoming more and more 'knowledge-based-economies,' then what a wise lady has written is also true: "This world is run by people who know how to do things. They know how things work. They are equipped... But we - we're just peasants. We don't understand what's going on. And we can't do anything." And, indeed, bad peasants to boot! Therefore Libya has to ask itself again and again: What ends its education system has to serve? Is it to produce bureaucrats or something else, say, thinkers, professionals, and problem solvers? If the answer is the latter, keeping in mind an old Chinese proverb would do the country a lot of good and save it a lot of headaches. The one that says: if you give a fish to a person that would only feed him/her for a day but if you teach them how to fish that will teach to feed themselves for life. With all the teaching the country has to do, who can afford to set aside piggy-banks, kids' accounts, and such luxuries only few snobby rich are in the habit of doing? Libya is by no means a rich country. It can barely feed and clothe, badly, its ever teeming masses.

        Is the model currently followed by most Arabian-stans viable? The answer, in the best scenario, is iffy. The path, of development, oil-stans are pursuing -if one can call it a model- is puzzling and mind bugling to say the least. A skewed model, which is, in essence, service-oriented and capital intensive! It consists mainly in: 1- Hiring others to build cities and facilities; 2- Establishing free-trade and development zones; 3- Or exporting the money to the centers of businesses and commerce.

        Hiring foreign firms, contractors and labor to do what locals cannot do wouldn't help development an iota. For the learning process, in building a country' cities and infrastructures, is development. These cities are equivalents, in 3-World, of Vegases, without the attractions these latter have, no different than pouring money, literally, into the sand dunes. Particularly when no local expertise, labor or business is involved or trained in their production. To hire outsiders to do projects what supposedly should have been the training grounds for the locals ain't going to help the economy or its development. The puzzling question is: Why development isn't set to the pace of local labor, expertise, and entrepreneurship'

        What's the rush about? If the rush is to find an alternative to oil-economy, say in tourism, then someone must answer the question: Why and who will come to vacationing in the Gulf states or in Libya, for that matter, when these places cannot offer a good meal (and a drink to go with it), not to mention other entertainments? Tourism isn't in buildings glass skyscrapers and expensive hotels. There's more to it than sand dunes, beaches or Greek-Roman ruins! It takes much more than Hollywood-type sets or fake smiles and assurances, to convince and attract people to a place. A place which has some unique qualities to it, such as: antiquities, old-towns and scenic villages, clean and accessible beaches, featured landscape, arts and crafts, frail for hospitality, fine cuisine, good people and tolerant culture, etc..... Enhancing and inventing some of the qualities, while no guarantee for success, is a must have since they're the sine quo none of the industry, a part and parcel of the infrastructures that a country's should attempt to have if it's seriously considering the entry into the fray of that cash-cow industry of tourism. It's a highly competitive field. Like in everything else, many would try, but few will succeed. The road is tortuous and uphill, fraught with kinds of holes and bumps.

        As to the so-called 'Free Zones.' Such areas are worth having when a country's internal markets are in need to meet the outside world. They're intended to attract what the country needs most. From capital, to expertise and everything in between. As well to export its own through some of these companies and firms. The idea in its essence is to give incentives for particular firms, goods and services the country needs. To be effective the country must be ready to use such devices to its benefits. The zones act as windows to the rest of the world and they would be good if these are used as exchange of goods, services, and know-how, between inside and the outside world. A meeting place and exchange but only if there's some local production and entrepreneurship. In an environment, however, as that of the oil-producing countries, these zones, basically will be no more than bonuses for the foreign and perhaps some local firms and companies that will take advantages of the breaks in the taxes and tariffs otherwise they'd have paid.

        The other option is to hit the stock-market. The sophistication of this sector is beyond the ability of these countries to master. Who's advised these fiefdoms to export their only viable commodity to make life easier for some other societies, is beyond comprehension? It must be part of petrodollars' re-cycling's strategy to convince the dimwits that stock-markets are better for their money than either keeping the oil in the ground or investing its revenues inside their own lands. Investments, stock-markets and suchlike need more acumen and expertise than these countries can muster. By hiring foreign managers and account operators to run their portfolios these countries are doubling their risks. In additions to markets' fluctuations, inflation, and currency problems, having 'mercenary managers' -who, presumably, do not give a hoot if some country wins or loses as long as their salaries or percentages were paid- makes any country think few times before embarking on such a fraught with dangers adventure.

Ghoma
Ghoma47@hotmail.com

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