SWEDEN

SWEDEN

The Dagens Nyheter, Stockholm, June 17: Our Latvian neighbors are really going through a tough time. The growth machine in the Baltics was suddenly transformed from the EU-country with the highest growth — to the one with the lowest.

Yesterday, the parliament, Saeiman, had to decide on the Latvian government’s proposal of a new, massive, cost-cutting package.

For three years the budget will be cut by 4 percent so that the IMF (International Monetary Fund) and the EU Commission can open their money taps from the West.

Latvian currency

It’s been speculated that the Latvian central bank is on its way to give up the costly defense of the Latvian currency, Lat, which is tied to the Euro to prepare the country for EMU (European Monetary Union) admission. That would give a much needed boost to the export industry and again entice foreign capital into the country. But since the current crisis is characterized by a gigantic fall in demand, it’s uncertain what the effect it would have. Also, around 20 percent of the Latvians with loans in Euro will have an even tougher time to repay their debts.

In practice, Latvia is likely to go down the same way as Montenegro to introduce the Euro one-sidedly. People and companies get the Euro to be on the safe side in case the Lat suddenly comes tumbling down. The Euro will become the actual method of payment, while the Lat is used as an official method of payment for taxes and transfers.

So, that is how the Latvian dream of the Euro would come true, but not in the way anyone had imagined.

ISRAEL

The Jerusalem Post, June 16: There was little hoopla locally yesterday, but there should have been: Israel’s economy was upgraded by Morgan Stanley Capital Index (MSCI) from “emerging market” status and accorded recognition as a full-fledged “developed market.”

This is no mean feat for a young country, a severely embattled one with few natural resources; one where virtually everything had to be started from scratch, often under the most adverse of conditions — including belligerence, boycotts and bad press.

Glass ceiling

The MSCI did more than pat Israel on the back. In the Tel Aviv Stock Exchange, this is regarded as breaking the glass ceiling. Israel has been admitted to play in the exclusive and prestigious top league.

To put the reclassification into context, we need to realize that when it takes effect, in May 2010, Israel will rank 18th among the 24 developed market members, with a similar market weight to Denmark and Belgium and greater than Norway, Ireland, New Zealand, Portugal and Greece.

Why was Israel thus honored? Plainly, because we are doing well. With $134.5 billion in stock-market value, the TASE outdid most of its counterparts globally during the present crisis.

We ought to congratulate ourselves on our tiny, beleaguered country’s achievements, welcome the recognition these achievements are receiving from objective international assessors, and do our utmost to justify the confidence we inspire.

JAPAN

The Asahi Shimbun, Tokyo, June 16: The new strain of swine influenza has become a global pandemic and will inevitably spread even further.

Margaret Chan, the World Health Organization’s director-general, announced the disease is now a pandemic and raised the alert level from Phase 5 to the maximum Phase 6.

The last great pandemic, called the Hong Kong flu, struck 41 years ago in 1968. The emergence of a new type of influenza had been seen as inevitable.

Human-to-human transmissions

The WHO decided to raise the alert level due to the constant increase in human-to-human transmissions in Australia, now that the Southern Hemisphere has entered the usual flu-prone season of winter.

We must not let our guard down.

Keiji Fukuda, WHO’s assistant director-general for health security and environment, suggests that the battle against the pandemic should be likened to running a marathon.

In line with the marathon reference, all countries and all people of the world will take part in this race. The virus will infect many of them sooner or later.

Moreover, this is a marathon in which all countries and individuals must work together to reach the same goal.

With this in mind, Japan must actively participate in international assistance. We must pay attention to developing countries and help them with treatment and research.

The WHO says countries where the infection has spread should divert their resources from time-consuming inspections and tests to treatment of patients and damage control.

Is Japan prepared for this?

BRITAIN

The Observer, London, June 14: It was said so often that it almost became a cliche of the financial crisis: a return to the status quo is not an option.

But simply repeating something does not make it happen. It seemed obvious during the most violent convulsions of the credit crunch that a new way of doing things was needed. But it is also a fact that the old way of doing things made some people very rich.

Now the bankers have been bailed out and the taxpayer has taken liability for all their past mistakes. With a deal like that, it is hardly surprising that they see a return to the old status quo as a rather appealing prospect.

State intervention

It is astonishing and alarming in equal measure how quickly the memory of last October has faded in the city. The whole banking system came within hours of collapse. State intervention saved the day and any subsequent recovery is underpinned by government authority. Finance was put on a democratic leash. At least, it should have been.

But already the political will to reshape the economy has flagged. ... the debate is being conducted among people who, for the most part, are not at the sharp end of the recession.

There is a danger now that the impetus for radical reform will be lost and that, with a few cosmetic changes, Britain’s economy will come out of this recession looking much as it did before, only smaller and with far more people alienated, unemployed and angry.