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• China’s rising prices : Terrorism and tourism
China’s rising prices : Terrorism and tourism
Daily Telegraph, London — July 25, 2005
Be careful what you wish for, Charles Schumer. He is the Democratic senator who has been jumping up and down, accusing the Chinese of foul and unnatural practices and of flooding the world with cheap goods.
Mr. Schumer did not like the fact that for 10 years the Chinese had fixed their currency at a low rate to the US dollar. …
Now he has withdrawn his bill and the Chinese have obligingly dismantled the currency peg. The yuan now tracks a basket of currencies. As a result, it has risen by two per cent. …
Freeing up foreign exchange has an important political effect: for the first time, Chinese citizens can enjoy one of the most fundamental rights of all: the right to leave, taking their assets with them. This is the ultimate sanction individuals hold over any state. And the signs are that some are doing just that, as Chinese businesses start to prowl around looking for Western investments, such as Rover, or American coal companies.
If the Asian central banks, by dumping their holdings of US Treasuries, do not now drive up long-term interest rates, then a steady increase in the price of Chinese exports, pushing up inflation in the West, could do so. …
If China is really serious about liberalisation – as it now seems to be – there might be a serious shake-out over the next few years, in which unprofitable enterprises go bankrupt and asset strippers move in. …
The Egyptian Gazette, Cairo — July 26, 2005
A key aim on the agenda of those behind the devastating attacks in the Egyptian resort of Sharm el-Sheik was to undermine the thriving tourism. The industry, a major foreign currency earner, pumped over US $6 billion into the national economy.
Arab holidaymakers, disappointed at perceived anti-Muslim sentiment in the West, shifted their sights to Egypt as an alternative destination. Over the past few months, there has been a noticeable rise in tourist arrivals in the country.
Egypt’s tourism is set to feel the pinch. Hence, the importance of working out a contingency plan to help the vital industry weather the storm. Egyptian tourism overcame in the past local and regional crises. It showed its resilience in the aftermath of slaying of 58 foreign tourists in an attack in the southern city of Luxor. Over the past five years, the hardy industry has flourished despite Palestinian-Israeli tensions.
Prescription for recovery should include, among other things, massive publicity worldwide that despite everything, Egypt remains a safe and unique destination. Terrorism has become a global threat, which, however, should not be allowed to besiege people of the world.
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