Archive | January 2014

These 10 countries are set to be the fastest-growing economies in 2014

The Economist Intelligence Unit has released its projections for economic growth in 2014, including the economies that are expected to grow the most this year. The results are telling – and have implications way beyond these 10 countries.

Before I get to the rankings, a note: I’ve removed two of the countries from the original list of 12. I pulled South Sudan, which is ranked first with an astronomical expected GDP growth rate of 35 percent, since that number is a little misleading. South Sudan shut down its oil exports in January 2012 amid a dispute with its northern neighbor, Sudan, which devastated its economy. So we’re not really seeing “growth” so much as the continued return to the norm after that very bad year. The second country I removed was Macau, ranked third with 13.5 percent growth, since it’s not a country; it’s a city-size special administrative region of China.

That out of the way, here are the 10 countries that are expected to have the most economic growth in 2014, ranked from first to last by percentage of GDP growth:
(1) Mongolia, 15.3 percent
(2) Sierra Leone, 11.2 percent
(3) Turkmenistan, 9.2 percent
(4) Two-way tie: Bhutan, 8.8 percent;
Libya, 8.8 percent
(6) Three-way tie: Iraq, 8.5 percent;
Laos, 8.5 percent;
Timor-Leste, 8.5 percent
(9) Eritrea, 8.0 percent
(10) Zambia, 7.9 percent

There are three important trends here. The first is that all of these countries, with the exception of Libya, are very poor. The second is that in most of them, economic growth is being driven by natural resources; often a single natural resource. The third, and maybe most important, is that many of the booms come from the sale of those natural resources to developing countries, often to a single developing country.

It’s nothing new for a very poor country to grow its economy by selling a single natural resource to richer countries. Maybe the most famous example is Saudi Arabia, which has been transformed by a half-century of selling oil to Western countries. The Persian Gulf, and the broader Middle East, have never been the same.

These numbers show a newer kind of trend, one that could have a similarly world-changing impact: Rising economies such as China and India reaching into nearby, resource-rich countries that have not benefited as much from Western demand. A knock-on effect of the rise of China and India is that Turkmenistan and Bhutan are changing, as well.

That is far from necessarily a good thing for the countries selling those resources. There’s a reason that economists call it “the resource curse” and not a “resource blessing”: The resulting boom weakens non-resource industries, can foster corruption, causes lots of inflation and can even spark internal competition for control of the precious resources. And all the growth from, say, selling natural gas or coking coal to China is just not very sustainable: When China stops buying, the comedown can be even worse than the initial high.

Top-ranked Mongolia has by some measures has been the world’s fastest-growing economy since 2012, fueled almost entirely by the sale of natural resources to China. The country is working really hard to figure out how to make its growth sustainable. But it hasn’t figured it out yet, and in the meantime the economic growth has created lots of pollution, economic inequality and a huge urban poverty problem as communities that have been happily nomadic for centuries are pulled into the newly booming cities.
The effects of these changes could extend well beyond, say, the Mongolian capital, Ulaanbataar. What does it mean for China when the very poor countries providing its resources become less poor? If Turkmenistan’s natural gas exports continue to rise, what will that mean for the economies of nearby gas exporters Iran and Russia? Will development in Sierra Leone, which has been involved in a number of larger West African conflicts, make further conflict less or more likely?
Development can be predicted; it’s not impossible to see how economic trends are likely to play out in specific countries. But the effects of that development can be much tougher to foresee.

Max Fisher is the Post’s foreign affairs blogger. He has a master’s degree in security studies from Johns Hopkins University. Sign up for his daily newsletter here. Also, follow him on Twitter or Facebook.


Organizational culture: an enabler or disabler?

Culture in the context of an organisation should be understood in the perspective of the setting it's in. In order to understand organisational context, it's important to see the organisations as communities. Using classical sociology as basis, there are two key cultural relationships in communities:sociability and solidarity. Sociability refers to effective relations between individuals who are likely to see each other's friends. They share ideas and values and associate with each other on equal terms. This represents relationships valued for their own sake. No real conditions are attached.

CultureSolidarity on the other hand, describes task focused cooperation between individuals and groups. It does not depend on close friendship or even personal acquaintance nor does it needs to be continuous. A perception of shared interest is enough to spark it which once in place solidarity can produce high levels of focus. To bring this home, if we were to ask someone to describe their ideal family, their would typically go straight to one where members like and love one another (sociability) and one that pulls together when times get tough (solidarity).

Thus, where there is high levels of sociability with low solidarity we find highly networked cultures. Most organizations fall into this category hence exhibiting such negative manifestations as clique formation, informal information exchanges that generally degenerate into dangerous rumour and gossip machines; friendly meetings that produce of talk but little action; and most importantly, considerable energy, especially among senior managers, that goes into organizational politics and making the right impression. There is more often than not managing upward rather than managing outcomes.

Most of us know or have read about these symptoms. Seeming perfect is the holy grail, with leaders seeking that out of their people which constantly makes people strive to impress the boss regardless of the consequences to individual relationships or team dynamics.

It is crucial for organisations to seek to have Hugh levels of solidarity and sociability. This keeps the team focused on common purpose while relating on a high trust basis.

Leadership is about generosity, not greed!

20140111-130505.jpg Revisiting your leadership approach is about looking at things through different lenses and from fresh perspectives. In that light, consider this: knowing when to say you have enough is also about being generous. When you push away from the table, you give others an opportunity to get a share of the pie. Using your size to gobble up everything in sight limits what others can do. Most corporate leaders are in a tough spot on this one, stuck between the rock of needing to make a living and the hard place of wanting to control their appetite. Watch that selfish appetite, it may be contrary to the role of leading others!

Culture, side effect or planned outcome?

CultureIn leading people, sometimes we forget that what we stand for and how we behave directly influences the people in the system. If you lead people and they don’t trust one another (or worse still, they behave in a way that’s detrimental to individuals and the team), you have no one to blame but yourself.

We have often heard that culture is a collection of believes, values and behaviors that make the way the organization behaves on an aggregated level (if you will). As such, it’s all fun and games for leaders to intellectualize about “how we do things around here” until suddenly it dawns on them that the the sum total of the organisational personality and ways of doing things (or culture if you prefer that) is directly influenced by the quality of leaders that hold the all important responsibility of steering the organisation.

You often find leaders who proudly rephrase and reclassify toxic elements in the system in an effort to legitimize illegitimate outcomes. Just because you call it ability to network, it doesn’t mean gossips are assets for your organisational. Similarly, if your people find it acceptable to create divisions and sow destructive hatred between individuals, you have no one to blame but yourself. You enable this either through your actions (by actively participating in the behaviours) or omission (by allowing the cancer to fester under your watch).

Great leaders understand that technical ability can never replace the ability to work with others. Interestingly, this ability is also the basis for serving customers (both internal and external) and therefore good for business all round.

So, instead of being passive recipients of cultural outcomes, leaders need to study their organizational make up, identify the good elements therein and ensure the good is rewarded and recognized while making it extremely uncomfortable for bad elements. Those terrorizing the organisation through their negative behaviours need to be clear that they are not welcome in the culture. Slowly but surely, organisational culture improves positively for the better in the long term.