• During the first eight months of 2011, domestic cement sales jumped by 28.6% compared to the corresponding period of 2010.

• Private sector imports of building materials financed through commercial banks (LCs settled and New LCs opened) increased y-o-y in August by 1.7% and 17.5%, respectively following annual increases of 39% and 15% in July. The growth in the new LCs opened indicates that imports of construction materials will continue its growth over the following months.

• The latest data published by Saudi Ports showed that discharges from construction materials increased 7.8% during the first seven months of 2011 compared with the same period in 2010.

Data from GulfBase.com

Chinese appliance maker Haier Group discovered that customers in one rural province used its clothes washing machines to clean vegetables. Hearing this, a product manager spotted an opportunity. She had company engineers install wider drain pipes and coarser filters that wouldn’t clog with vegetable peels, and then added pictures of local produce and instructions on how to wash vegetables safely. This innovation, along with others including a washing machine designed to make goat’s-milk cheese, helped Haier win share in China’s rural provinces, while avoiding the cutthroat price wars that plagued the country’s appliance industry.

More examples in the full article (registration required).

Excerpts:

During the high-growth years between 1992 and 2007, the globalization of commerce galloped at a faster pace than in any other period in history. Now, amid the chronic unemployment and anti-trade rhetoric of the post-financial-crisis world, some observers wonder whether globalization needs a time-out. However, the experience of multinational companies in the field suggests the opposite. For them, globalization isn’t happening rapidly enough. [...]

The problem is not globalization, but the way our current institutions are set up to respond to this new demand. The prevailing corporate operating model does not work well with the structural changes that have taken place in the global economy.

Most companies are still organized as they were when the market was largely concentrated in the triad of the old industrialized world: the U.S., Europe, and Japan. These structures lead companies to continue building their global strategies around the trade-offs and limits of the past — trade-offs and limits that are no longer accurate or relevant.

One of the most prevalent and pernicious of these perceived trade-offs is the one between centrally driven operating models and local responsiveness. In most companies, an implicit assumption is at play: If you want to gain the full benefits of economies of scale — and to integrate common values, quality standards, and brand identity in your company around the world — then you must centralize your intellectual power and innovation capability at home. You must bring all your products and services into line everywhere, and accept that you can’t fully adapt to the diverse needs and demands of customers in every emerging market.

Alternatively (according to this assumption), if you want locally relevant distribution systems, with rapidly responding supply chains and the lower costs of emerging-market management, then you must decentralize your company and run it as a loose federation. You must move responsibilities for branding and product lineups to the periphery, and accept different trade-offs: more variable cost structures, fewer economies of scale, more diverse and incoherent product lines, and more inconsistent standards of quality.

Some companies try to use strict cost controls to manage these trade-offs. They put in place a decentralized operating model with some central oversight, usually augmented by outsourcing. But this is a tactical move based on expediency, rather than a global strategy. This approach leads to suboptimal results in today’s complex world.

Other false trade-offs are visible in the tension many companies experience between their current business model and the needs of the emerging markets they are entering. They wonder:

• Whether to serve existing customers in their home countries or new customers in emerging countries.

• Whether to meet competitive quality standards demanded by consumers in wealthy countries or offer just the “good enough” features that poorer customers can afford.

• Whether to pursue a strategy of premium or discount pricing.

• How to attract and retain resources and talent, which are perceived as draining away from emerging markets to the industrial world whenever employees are permitted to migrate.

• Whether, in using resources strategically, to follow the typical Western orientation (toward reducing labor and accumulating capital) or the view from emerging markets (where labor is inexpensive, capital is difficult to accumulate, and therefore it is worth investing in building large workforces for growth).

[...]

Many CEOs and top managers are still asking themselves when the bad times will end. No one has the answer, and even in a robust recovery, competition will not slacken. A better question is, What can we do now to establish ourselves in the new global economy? Consumer-oriented companies will need to deliver world-class quality in their products and services, customized for purchasers in multiple locales and circumstances, with significant price reductions (affordable to people at the lowest income levels). They must also provide their customers varying forms of access (owning, renting, or leasing equipment). This cannot be done when a company is striving to balance decentralization and centralization. It can be accomplished only by companies that transcend the old trade-offs and seek operating models that allow them to serve the largest numbers of people while meeting the highest possible standards.

Full article: http://www.strategy-business.com/article/11308

Some have called this movement the “Arab Spring” or the “Arab Movement,” however, the “Arab Renaissance” is more befitting since for the first time in generations the overwhelming majority is willing to question the powers of authority.  Respective peoples are no longer willing to stand idle and take direction from one ruler or one family of rulers.  For so many years the gap between the have and have-not has grown in the two regions by leaps and bounds, thus making it more difficult, if not impossible, for the average person or family to grow and enjoy the financial security that only a handful have monopolized.

There are two schools of thought dominating the events of the recent months in the region.  First are those who look at the series of events from a suspect point of view that the peoples’ movement could very easily be hijacked by “Radical Islamist” groups.  They point to the 1979 revolution in Iran and the adverse results which were, and to this day are still being felt around the world.  Although this is a valid concern and a sad reality, one has to keep in mind that in the past 32 years the world has been changed dramatically by information technology, and therefore, it seems unlikely that any such group could usurp and retain power.

Case and point, when the Iranian Revolution took place, technology did not play a significant role in it by any means.  Thirty two years ago the “internet” was known by only a very select few researchers and engineers, and no one could have envisioned the host of other IT advancements that we readily have available today.  Back then the youth did not enjoy instant access to the events taking place in their neighboring countries, let alone countries on the other side of the world, which made it easy for groups with ominous intentions to keep the public in the dark and thus capitalize on the dissatisfaction of the people and direct events to their own advantage.

Without getting into too much detail about the Iranian Revolution, we can fast forward to the events of late and the second school of thought, which pivots on the youth of today.  The Tunisian movement is the epitome of today’s “Youth Movement”.  With access to information covering every aspect of life imaginable, people can make better judgment calls and avoid pitfalls such as we have seen before.  No longer is the new generation willing to stand by and watch the quality of their lives deteriorate.  They see and understand how the rest of the world is moving forward with dizzying speed as they are losing any hope of a better future. Therefore, empowered by information technology and a willingness to sacrifice their lives if necessary, there is great hope among both the youth and the repressed masses of effecting drastic change and attaining a more promising future. Meanwhile, the oil-producing countries in the region are well aware of the fact that they possess finite amounts of oil that coupled with today’s rapid advancements in technology has put them between a rock and a hard place.  The situation is even direr in non-oil producing countries of the region.  In short, one can say that the writing is on the wall, and these governments are faced with the harsh reality that in today’s world ruling with an iron fist is no longer tolerated.

Hence, the beginning of the “Arab Renaissance” will lead to more “open” and more “democratic” systems to be put in place.  With the promises of financial aid from the G8/G20, nations of the Middle East and North Africa have a chance to bring themselves more in line with the rest of the developed world.  This will encourage virtuous influxes of capital, ideas, and businesses into the long suffering region.  An abundance of manpower desirous of gainful employment, in concert with available natural resources and a strategic geographic location, will prove to be a powerful combination which can only serve to enhance the prosperity and the stability of the region.

Special feature written by Simon Tash, an independent advisor to TradeFlow21.

There are historic opportunities for greater openness and citizen participation in economies across the Middle East and North Africa (MENA) that, if strongly managed over the transitions ahead, could see a significant boost to economic growth and living standards in the medium term.
This is the analysis presented on My 24, 2011 in the World Bank’s Regional Economic Outlook: MENA Facing Challenges and Opportunities. The report notes that current economic disruption in many MENA countries is translating into lower growth in the short term (now forecast at 3.6 percent for 2011 down from 5 percent) but that opportunities in the medium term offer new hope for an inclusive and sustainable development that has not before been seen in the region.

“The rich experience from countries that have undergone political changes suggest that short-term disruptions to economic growth and social  tensions are inevitable,” said Shamshad Akhtar, World Bank Vice President for the MENA region.  “However, transition offers an opportunity for countries to break with the past and set course in a newer direction.  A first order of priority is to offer the right signals to restore public and private investor confidence which, in MENA, calls for ensuring respect and citizen dignity through inclusive social policies, a fundamental change in governance frameworks and swiftly restoring macroeconomic stability.”

The report finds that by the end of 2010, MENA countries had largely recovered from the global financial crisis, and growth rates had been expected to reach pre-crisis levels in 2011. Events in early 2011 which led to swift regime change in Tunisia and Egypt, and ongoing challenges in Bahrain, Libya, Syria and Yemen, have affected the short-term macroeconomic outlook and the status and speed of economic reforms in the region.

“The effects of reform tend to follow a J-curve, where things get worse before they get better. Experience from other countries which have made successful transitions has shown an initial decline of 3 to 4 percent in the first year but quickly recovering,” said Caroline Freund, Chief Economist for the MENA region.

“Also encouraging is that successful countries saw significant and fast improvements in voice and accountability, some of the very things that underpin the MENA uprisings. We need to learn from history’s successful transitions and carefully manage the short-term downturn which is where we are focusing our best efforts now. While the challenges are many, the opportunities are more.”

More excerpts and link to full report here.

When Chinese President Hu Jintao visits Washington next week, he will be greeted by an American public that looks to Asia—rather than to Europe—as the region of the world most important to U.S. interests. This marks a major change from the 1990s, when Americans still considered Europe more important than Asia, even despite concern about Japan’s supposed ascendance. [...]

A new nationwide poll by the Pew Research Center finds Americans considering Asia more important by a 47% to 37% margin. In 1993, the balance of public opinion was the opposite: 50% considered Europe most important, 31% Asia. Questioned today about their interest in news from various countries, 34% of Americans say they are very interested in news from China, while far fewer say the same about France (6%), Germany (11%), Italy (11%) and even Great Britain (17%).

[...]

Americans are wary of China’s trading policies. While most welcome increased trade with Canada, Japan and European Union countries—as well as India, Brazil and Mexico—Americans are divided about trade with China. Forty-five percent see it as a good thing, 46% as a bad thing.

While there is alarm, there isn’t quite panic over China’s growing economic power. A Pew Global Attitudes survey last year found that although 47% of Americans consider China’s growing economic power a bad thing, larger numbers of Western Europeans see it that way. In France 67% share the view, and in Germany 58% do.

In the U.S., 79% of Americans say that Chinese military power is a bad thing (and most Europeans agree). [...]

Americans have two seemingly conflicting views on China policy. Fifty-three percent think the U.S. should get tougher with China on trade issues, but nearly as many (58%) say that U.S. policy should try to build stronger relations between the two countries. Many fewer want to scold China about its human rights (40%) or environmental policies (39%).

The bottom line is that Americans don’t want to demonize China, but they have reservations about the effects of U.S.-Chinese trade. [...]

You can request the full article and the full Pew Research Center report from us.