Entrepreneurship Reading Lists


  • “Beyond Entrepreneurship,” James C. Collins, William C. Lazier: New Jersey: Prentice Hall, 1992.
    Discussion of the roles of leadership, vision, and creativity in growing, entrepreneurial ventures.
  • “Glorious Accidents,” Michael J. Glauser: Utah. Shadow Mountain, 1998.
    How everyday Americans create thriving companies.
  • “New Business Ventures and the Entrepreneur,” Howard H. Stevenson, Michael J. Roberts, and H. Irving Grousbeck: Boston: Richard D. Irwin, Inc., 1989.
    Textbook that traces the entrepreneurial process from the initial idea through business operations to harvest and includes case studies.
  • “Soloing,” Harriet Rubin: New York: Harper Collins Publishers, Inc., 1999.
    Discussing the ups and downs of going solo in business.
  • “The Book of Entrepreneurs’ Wisdom,” edited by Peter Krass: New York: John Wiley & Sons, Inc., 1999.
    Classic writings by legendary entrepreneurs such as; Lillian Vernon, Phil Knight, and Dave Thomas.
  • “The Entrepreneurial Mindset,” by Rita McGrath and Ian MacMillan: Cambridge: Harvard University Press, 2000.
    Strategies for continuously creating opportunity in an age of uncertainty.
  • “The 10-Second Internet Manager,” by Mark Breier: New York: Crown Business, 2000. Survive, thrive, and drive your company in the information age.
  • “Moral Intelligence: Enhancing Business Performance and Leadership Success” by Doug Lennick & Fred Kiel.
    Demonstrates that maintaining the highest ethical standards is not only the ‘right’ thing to do, but produces the best companies and the best results.
  • “Engineering Your Start-Up: A Guide for the High-Tech Entrepreneur” by James A. Swanson and Michael L. Baird, 2003.
    Gives you all the basic information needed to make your idea a business reality. James Swanson is a GSB Alum.

Silicon Valley

  • “Understanding Silicon Valley: The Anatomy of an Entrepreneurial Region,” edited by Martin Kenney, Stanford University Press, 2000.
  • “Regional Advantage,” Annalee Saxenian. Cambridge: Harvard University Press, 1996.
    Analysis of the factors contributing to the success of Silicon Valley and Route 128.
  • “The Silicon Valley Way,” Elton B. Sherwin, Rocklin, CA: Prima Publishing, 1998.
    Provides background on the growth of Silicon Valley and a concise business planning approach.
  • “In the Company of Giants,” Rama Dev Jager, Rafael Ortiz. New York: McGraw Hill, 1997.
    Conversations with 16 leaders of the digital world, written by two graduates of the Stanford GSB.
  • “The Silicon Boys and Their Valley of Dreams,” David A. Kaplan, New York: William Morrow and Company, Inc., 1999.
    A look at some of the most powerful people in Silicon Valley: Bill Gates, Jim Clark, Andy Grove, to name a few.
  • “The Monk and the Riddle,” Randy Komisar, Cambridge: Harvard University Press, 2000.
    The education of a Silicon Valley entrepreneur.

Start-Up Stories

  • “Upstart Start-Ups!,” Ron Lieber. New York: Broadway Press, 1998.
    Learnings from 34 young entrepreneurs, including 1993 Stanford GSB graduates, Steve Pollock and Gary Alpert, founders of Wet Feet Press.
  • “Growing a Business,” Paul Hawken. New York: Simon & Schuster, 1987.
    A classic story of building a business.
  • “Startup: A Silicon Valley Adventure,” Jerry Kaplan. New York: Penguin Books, 1994.
    A behind-the-scenes look at a company’s creation and eventual demise.

The Internet

  • “aol.com,” Kara Swisher. New York. Random House, 1998.
    How Steve Case beat Bill Gates, nailed the netheads, and made millions in the war for the Web.
  • “Webonomics,” Evan I. Schwartz, New York: Broadway Books, 1997
    Strategies for capitalizing on potential of the Internet.


  • “Blown to Bits,” Philip Evans and Thomas S. Worsted, Boston: Harvard Business School Press, 2000.
    How the new economics of information transforms strategy.
  • “Done Deals,” edited by Udayan Gupta. Cambridge: Harvard Business School Press, 2000.
    Venture capitalists tell their stories.
  • “Where to Go When the Bank Says No,” David R. Evanson. Princeton: Bloomberg Press, 1998.
    Practical advice on how to get small business financing.
  • “Finding Your Wings,” Gerald A. Benjamin, Joel Margolius. New York: John Wiley & Sons, 1996.
    Guide to finding private investors to fund a start-up.

Reference Guides

  • “The Home Business Bible,” David R. Eyler. New York: John R. Wiley & Sons, Inc., 1994.
    An encyclopedia of information for the home-based entrepreneur.
  • “The Entrepreneur’s Guide to Business Law,” Constance E. Bagley, Craig E. Dauchy. West Educational Publishing Company, 1998.
    This guide walks the entrepreneur through all the legal steps required to start a business.
  • “Guts & Borrowed Money,” Tom S. Gillis. Austin: Bard Press, 1997
    Nuts and bolts guide to starting your own business.
  • “Business Start-up Kit,” California Chamber of Commerce. Lafayette, Productivity Products, Inc., 1997.
    Everything you need to comply with government requirements throughout the year, whether you are a sole proprietorship, partnership or corporation. The series also includes labor law, OSHA, and business planning kits.

Social Entrepreneurship

  • “Revolution of the Heart,” Bill Shore. New York: Riverhead Books, 1995.
    The story of Share Our Strength, a self-sustaining nonprofit organization.
  • “New Social Entrepreneurs: The Success, Challenge and Lessons of Non-Profit Enterprise Creation,” Jed Emerson and Fay Twersky. San Francisco: The Roberts Foundation, 1996.
    Experiences of the Roberts Foundation in nonprofit enterprise development.



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American FSO Reading List

I should rename this blogsite official repost everything blog for pseudo original ideas www.kyrasofya.blogspot.com :   


Recommended Reading Source: http://www.embassy.org/library/commend.html#Foreign

Polish Military OfficeThe following books provide excellent reading on issues of diplomacy and other aspects of international affairs, as well as the advent of new information technologies in their conduct.

Periodicals on Foreign Affairs and Public Policy

A Bibliography on the Foreign Service (the U.S. State Department):

On Diplomacy:

The Ugly American, by William J. Lederer and Eugene Burdick, first published in 1956, is a fictional account of Americans abroad–both as diplomats and as citizens–and an excellent treatment of cross-cultural issues. A product of the Cold War, but as worth reading today as it was when first written.

Witness to History, 1929 to 1969, by Charles Bohlen, is a sizable but entertaining autobiographical account by one of America’s ambassadors to the Soviet Union.

215 Days in the Life of an American Ambassador, by Martin Herz, is another autobiographical account, this time by an American ambassador to Bulgaria.

Welcome Home : Who Are You? : Tales of a Foreign Service Family, by Gene Schmiel, is a series of vignettes chronicling the author and his family’s experiences in the Foreign Service.

On Espionage:

The late Graham Greene served in the British intelligence service during World War II, and many of his novels capture the bleaker side of the life of an intelligence officer, in both “peacetime” and war.

  • The Quiet American – on early American involvement in the wars in Southeast Asia
  • Our Man in Havana – a Cold War farce, as a vacuum cleaner salesman is recruited to spy for his country
  • The Comedians – an account of life in Haiti under the Duvalier (“Papa Doc”) government
  • The Third Man – intrigue in post-World War II Vienna

Secret Messages : Codebreaking and American Diplomacy, 1930-1945, by David J. Alvarez, documents the impact of decoded radio messages (signals intelligence) upon American foreign policy and strategy from 1930 to 1945.

On Information Technologies and International Relations:

Two books by Ithiel De Sola Pool were excellent forecasts of the changes we see taking place today:

Technologies Without Boundaries was compiled from writings by Pool prior to his death in 1984. An excerpt:

“It has often been urged that terminals on embassy staff desks would enable a typed message to appear immediately in the terminal of any similar office in Washington. Such a message facility would have the flexibility and instantaneity of the telephone but be cheap enough to be used freely. It would bring the embassy staffs into the same situation as their fellow bureaucrats back home in the United States, who have telephones at hand with which they can talk to anyone they wish, without concern about the cost or availability of lines. Yet this suggestions meets fierce resistance on the grounds that it will prevent effective control and coordination by the ambassador of his team. Anyone in the field would be free to reach anyone in Washington. Back home, this situation does not appear to get out of hand; reasonable norms control whom people actually call directly. But in the foreign services, telecommunication is feared as an instrument of decentralization that reduces hierarchic control.” (p. 70)

Additional Recommendations

The following books were suggested by Meridian International and the Smithsonian Associates Program to complement their course on “The Ambassadors: New Diplomacy in a New World:”

* Institute for the Study of Diplomacy publications may also be ordered by telephoning (202) 965-5735.

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i guess this blog is my official repost anything blog

my official blog is www.kyrasofya.blogspot.com


http://www.dfa.gov.ph/news/pr/pr2007/2006yearendreport.htm source
Highlights of the Department’s Accomplishments in 2006
The year 2006 was a year of extraordinary challenges for the Department of Foreign Affairs – and, likewise, a year of extraordinary achievement. The Department’s mission has always been to advance the interests of the Philippines and the Filipino people in the international community. Its accomplishments in 2006, however, are a true testament to the dedication of its personnel to implementing and shaping a foreign policy that serves the people. Our Foreign Service personnel were actively involved in ensuring the safety of our nationals in various crisis points around the globe, even as they worked to push for international and regional initiatives that would protect Philippine interests.  The Department’s work, as always, was focused on the three pillars of Philippine foreign policy: the preservation and enhancement of political/national security; the promotion and attainment of economic security; and the promotion and protection of the welfare of overseas Filipinos. 

Political/National Security

The Department continued its work in facilitating and coordinating international efforts to sustain the peace process in southern Mindanao. It created opportunities for members of the International Monitoring Team (IMT) and the representatives of the Organization of the Islamic Conference’s (OIC) Secretary General to visit the affected areas and meet with local stakeholders such as the mayor of Marawi City. These meetings resulted in the OIC’s renewed commitment to supporting the peace process, particularly in terms of developing a socioeconomic environment in Mindanao that would foster peace and eradicate terrorist activity.  Likewise, the Department continued to update other members of the international community of developments in the Philippine peace process, and has facilitated the formal invitation of several interested countries, such as Japan, Finland, and Sweden. During this year’s celebration of the 50th Anniversary of the Normalization of Japan-Philippine Relations, Japanese Foreign Minister Taro Aso announced his country’s intention to join the International Monitoring Team. Japan has since deployed a development expert who now serves as Senior Adviser for the socioeconomic aspect of the IMT. Sweden, on the other hand, has indicated its positive consideration of the invitation, and has sent a mission to visit the IMT headquarters in Cotabato City.  The Philippines continues to pursue its bid for OIC observer status, and to this end, Secretary Romulo attended the 33rd Islamic Conference of Foreign Ministers (ICFM) in Baku, Azerbaijan, where he delivered a speech before the OIC plenary. The Secretary also took the opportunity to hold bilateral meetings with his counterparts from Indonesia, Iran, Pakistan, Azerbaijan, and Libya, to ensure their support for the Philippines’ observer bid.  The Philippines has taken a proactive stance toward the enhancement of national and regional security. In 2006, the country focused its efforts on promoting the Philippine-led interfaith initiative, as well as enhancing regional and bilateral cooperation for counter-terrorism initiatives.  The interfaith initiative, which was introduced by President Gloria Macapagal-Arroyo during her term as president of the UN Security Council last year, rapidly gained ground this year. The Philippines has articulated, in various regional and international fora, its experience in using interfaith dialogue within its multicultural, multi-ethnic society, and its conviction that interfaith dialogue can serve as a foundation for lasting peace. The initiative has enjoyed support from the international community in the past year. On March 24, 2006, when Secretary Romulo launched the Tripartite Forum for Interfaith Cooperation for Peace in New York, he was joined by 50 governments, 12 UN agencies, and 110 religious NGOs that were similarly committed to exploring practical measures for the application of interfaith dialogue and cooperation for peace.  The strengthening of key bilateral and regional partnerships for counter-terrorism efforts has also been at the top of the Department’s agenda for 2006. As a member of the Asia-Pacific Economic Cooperation (APEC) and chair of the APEC Counter-Terrorism Task Force (CTTF), the Philippines has been actively pushing for public-private cooperative partnership in building the counter-terrorism capacities of developing member economies in APEC. This year, the Philippines came out with the APEC Counter-Terrorism Review, which presented a comprehensive review of the CTTF’s accomplishments since its activation in 2003. 

Economic Security

On the economic front, the Department has concentrated not only on strengthening existing partnerships for trade and development, but on the promotion of Philippine culture as a means of enhancing the international community’s awareness of the country’s products and tourist attractions. The year 2006 saw the signing of the historic Japan-Philippines Economic Partnership Agreement (JPEPA) at the sidelines of the Asia-Europe Meeting (ASEM) in Helsinki, Finland. Under the JPEPA, the Philippines is the only country at this time that is allowed to send health workers to Japan, which is estimated to need 7.5 million health professionals by 2010. The Philippines also continued to strengthen its economic ties with China, in pursuit of a mutual trade goal of US$ 30 billion by 2010.  In coordination with relevant government agencies, the Department has organized roadshows and trade missions to important markets, such as the US, Canada, India, Mexico, Saudi Arabia, and Russia. Taking advantage of the recent economic boom in the Gulf States, the Department launched the Roadshow to the Middle East, which covered major commercial centers in the Gulf Area such as Riyadh, Dammam, Dubai, Abu Dhabi and Doha. The Roadshow concentrated on promoting Philippine service exports such as outsourcing, engineering, and architecture, which are in demand due to the ongoing infrastructure development that is taking place in these cities.  Developing energy security has also been a major part of the Department’s work in economic diplomacy, and to this end the Philippines has strengthened its bilateral and multilateral relationships with strategic partners such as China and Russia. The thrust toward developing energy security was highlighted during the State Visit of President Macapagal-Arroyo to the Kingdom of Saudi Arabia in May 2006, during which she explored possible technical cooperation between the two countries in developing the Philippine energy sector, and invited investors to explore the possibility of putting up an oil refinery in Mindanao.  The promotion of Philippine cultural awareness in the international community has been one of the Philippines’ key strategies for the promotion of trade and tourism. In coordination with DOT, the Department organized the 2nd Ambassadors/Consuls General Goodwill Tour of the Philippines in July 2006, which aimed to expose and familiarize participants from the United States and Canada to various potential areas of investments, livelihood, business, retirement, and tourism in the Philippines.  Philippine products have also been creatively marketed through the annual Independence Day celebrations of our Foreign Service Posts, which use the celebrations as an opportunity to promote trade and tourism. The Centennial Tribute Gala hosted by the Philippine Embassy in Washington D.C. in commemoration of the Centennial Anniversary of Filipino Migration to the United States featured a cultural heritage show headed by Jose “Pitoy” Moreno, one of the Philippines’ top designers. 

Promotion and Protection of Overseas Filipinos

Since the Gulf War in 1990, the Department, through its Foreign Service Posts, has actively developed and updated evacuation strategies for Filipino communities in the event of crisis situations. These evacuation strategies, which are developed and implemented in coordination with Filipino community leaders, relevant Philippine government agencies, and the local authorities of the host country, were a critical factor in the successful evacuation and repatriation of over 6,000 Filipinos from Lebanon during the Israel-Hezbollah conflict.  Through the coordinated efforts of various agencies of the Philippine government, the first batch of evacuees was repatriated a mere week after the initial outbreak of hostilities. The efficiency and professionalism of the Philippine evacuation operations were later cited by the Regional Representative of the International Organization for Migration, who commended the Philippine government for its “excellent work”, as well as the “professionalism and commitment” of the personnel involved in the operations.  The Department has also been active in the protection of the welfare of overseas Filipinos, particularly those facing criminal cases in foreign countries. In 2006, out of a total 33 Filipinos reported to be on death row, the Department successfully negotiated for and secured the commutation of the sentences of 5 Filipinos. The cases of another 19 Filipinos are currently undergoing negotiations for the grant of tanazul, or forgiveness, which is a requirement of shari’ah courts for the commutation of the death penalty.  The improvement of the Department’s consular services, such as the issuance of passports and authentication certificates, has also been a key strategy for the protection of our overseas Filipinos. Aside from the ongoing development of a machine-readable passport, which will provide increased security of personal information, the Department has been continuously working on streamlining its frontline services in an effort to reduce the incidence of fixers.  In 2006, the Department implemented Project 30-15, which effectively reduced the average waiting time for processing and release of authenticated documents to 30 and 15 minutes respectively. Likewise, Oplan Fastport allows the uninterrupted processing and release of passports from 7am to 5pm from Mondays to Fridays.  Through its Mobile Passport Missions, the Department was also able to offer one-day processing and release of passports in various municipalities and cities across the country.  The dedication of Foreign Service personnel to their mission to protect and promote the welfare of Filipinos was highlighted by their voluntary efforts to contribute to various causes. In November, the Department and Gawad Kalinga (GK) launched the GK-DFA Volunteers Village in Barangay Tawi-tawi, Pasig City, which was funded solely by donations of DFA personnel in the home office and in Foreign Service posts. More recently, Department personnel contributed donations in kind to the President’s humanitarian mission to areas and families devastated by Typhoons Milenyo and Reming. 

It is this dedication and a sense of personal responsibility of its personnel for their mission that has contributed to the achievements of the Department in 2006, as a truly exceptional year.

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Walden Bello – FDC

Below is a repost of a circulated article about FDC’s new president. I am proud to be part of this group. (www.kyrasofya.blogspot.com)

ONE of the fiercest critics of international financial
institutions such as the World Bank and the
International Monetary Fund, and of the current model
of economic globalization has been elected as the new
president of the Freedom from Debt Coalition during
its 10th National Congress held over the weekend in
Quezon City.

Intellectual activist Prof. Walden Bello, who teaches
sociology and public administration at the University
of the Philippines, will be replacing development
activist and feminist leader Ana Maria R. Nemenzo, who
served six years as its president.

“I believe FDC faces an exciting period in the next
three years under Walden’s leadership. He brings a
clear vision and principled commitment to an urgent
task ahead—the need to craft an alternative national
economic platform that challenges neo-liberal
globalization,” Nemenzo said.

In his acceptance speech, Bello stressed that the
country’s foreign debt today is at its highest level
in history.

“We have paid our debts many times over, yet owing to
the tyranny of global finance, we will never be able
to leave the treadmill of debt repayment if we stick
to unfair rules that mainly serve the interests of
creditors,” he said.

As of August 2007, the national government’s foreign
debt stood at P1.7 trillion (US$1=PhP46. 85). This
represents 44 per cent of the total P3.87-trillion
national government debt.

He lamented that for the Arroyo government, debt
servicing must proceed according to the terms of the
creditors because, “in their view, that is the only
way to continue to access international capital

“But this is the bankrupt logic that has led to debt
being piled on debt. We have not really escaped the
infernal logic of contracting new debt to pay off old
debt. Meantime, our total debt mounts dangerously and
brings us closer to the edge of bankruptcy,” warned

Bello explained that the relationship between debtors
and creditors has been altered by several events
during the last few years, and this has implications
for the Philippines.

He cited the determination of Former Argentinean
President Nestor Kirchner who showed the world that
his government can take on a country’s creditors and
come out on top.

“As a result of Kirchner’s successful campaign to
drastically reduce debt repayments, Argentina has been
growing at 10 per cent of GDP for each of the last
four years, the result partly of the fact that money
that would otherwise leave the country for debt
servicing has been channeled into investment in the
domestic economy,” he said.

The former executive director of Focus on the Global
South also explained how the IMF, which used to be the
enforcer of the creditors, has become a severely
weakened institution today as a result of the bad
policies it imposed on Asian countries during the 1997
financial crisis and on Argentina in 2002.

“Some of its biggest borrowers have walked away from
it, and since the Fund’s budget stemmed in great part
from repayments from these borrowers, the IMF is today
facing both a crisis of credibility and a budgetary
crisis. It is in real trouble,” stressed Bello, also
the former chair of the board of Greenpeace Southeast

Unfortunately, Bello said these developments have not
registered with the Philippine government.

“[The government’s] policies toward its creditors
continue to be the old policy of being a ‘model
debtor’ that was initiated by President Corazon Aquino
in the 1980’s. The conditions for a successful break
with the old and the crafting of a new bold policy of
unilaterally writing down the Philippine debt are
better today than they have ever been,” he said.

Bello stressed that in the coming three years, FDC
must lead in getting our country towards the path of
financial independence, and in the crafting of an
alternative financial path that would truly serve the
interests of the country.

Bello, who has authored 14 books, wrote Development
Debacle: the World Bank in the Philippines (1982)
which exposed the support given by IMF and World Bank
through loans and grants to former dictator Ferdinand
Marcos to remain in power during the Martial Law
period. The story goes that 3,000 pages of
confidential documents were “smuggled” or secretly
taken out of the Bank and were used as the material
for the book. The book became an underground
bestseller, not only in the Philippines, but also in
the development community worldwide.

In 2003, Walden Bello was given the Right Livelihood
Award, also known as the Alternative Nobel Prize, “for
outstanding efforts in educating civil society about
the effects of corporate globalization, and how
alternatives to it can be implemented.”

The Belgian newspaper Le Soir has called Prof. Bello
“the most respected anti-globalization thinker in
Asia,” while Canadian author Naomi Klein has called
him the “world’s leading no-nonsense revolutionary.”

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Power To The People

I attended a consultation workshop on the power industry for the past two days. The wealth of information is staggering and the number of options that are available for us to avail of affordable and quality electricity service is inspiring. 

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Bold and Defiant (the Argentina Example)

This is a repost of an article send through group email:

Argentina snub of Washington Consensus Pays Off

By David J. Lynch, USA TODAY, 8/11/07

BUENOS AIRES — Left for dead by the global financial community in 2002 after defaulting on more than $100 billion worth of debt, Argentina today is enjoying the sixth year of one of the unlikeliest economic expansions in memory.

The economy purrs at a growth rate of better than 8%. The peso, once so suspect that individual provinces printed their own currencies, is sound. And foreign-exchange reserves are bountiful.

“Over the past four years, Argentina has recovered its hope,” says Mercedes Marco del Pont, a member of Congress.

Argentina ‘s resurrection is especially compelling measured against the extraordinary depths of the 2001-02 financial crisis. Stiffing international bondholders intensified the worst economic downturn any developed country had experienced since the 1930s, beggared a prosperous middle-class and plunged more than half the population below the poverty line.

But most noteworthy is how Argentina climbed out of its financial hole: by defying the conventional economic wisdom the United States has peddled throughout Latin America for the past generation. President Nestor Kirchner has thrust the state deep into the economy, taxing exports, freezing key prices and shunning the Washington-based International Monetary Fund in favor of deep-pocketed Hugo Chávez of Venezuela . Today, Argentina ‘s turnaround is Exhibit A for those who doubt globalization’ s one-size-fits- all policy prescription.

FIND MORE STORIES IN: Argentina | Inflation | International Monetary Fund | President Nestor Kirchner

“The biggest significance of this recovery is they just rejected the orthodox economic advice … and they’ve been the fastest-growing economy in the Western Hemisphere over the last five years,” says Mark Weisbrot, a left-of-center economist at the Center for Economic and Policy Research in Washington .

Now, as newly elected President Cristina Kirchner prepares to succeed her husband next month as Argentina ‘s chief executive, there are worrying signs about the economic comeback’s longevity. Inflation is gathering steam amid widespread allegations that the government is deliberately manipulating official price statistics. Energy shortages, which many analysts link to price controls that have discouraged new investment, are a chronic concern.

Government officials, who continue to operate under an “economic emergency” law, insist they can steer the economy forward without sharp policy changes. Cristina Kirchner has indicated she plans to bring labor and business leaders together to agree on “social pacts” that will control wages and prices, but market-oriented economists are skeptical. “It’s a mess of a theory. … This will not work,” said Federico Thomsen, an economist here who advises multinational corporations on the local market.

Spurning the IMF

Argentina ‘s current approach is a stark contrast to the 1990s, when an earlier government enthusiastically implemented market-oriented policies known as the Washington Consensus. Then-President Carlos Menem sold off state-owned industries, opened the economy to trade and attacked inflation by linking the peso to the dollar at an artificial 1-to-1 level.

At first, the economy expanded, and inflation, which peaked at an annual rate of 4,923%, cooled to near zero. But amid a recession that began in 1999, Argentina ultimately was forced to abandon its 1-to-1 exchange rate, sending the peso into free fall and impoverishing millions who owed payments on dollar-denominated mortgages and other loans.

In Washington , the IMF blamed the crisis on Argentina ‘s habitual overspending. But many here concluded that the IMF specifically, and free-market policies in general, had failed them. “People came out against the neoliberal policies that got us into this mess. The 1-to-1 exchange rate emptied the country of everything it was worth and drove us into bankruptcy,” says Ruben Rosmarino, 51, a cobbler in the working-class La Boca neighborhood.

The post-crisis government of populist President Nestor Kirchner defied the IMF by halting debt payments and levying taxes on exports and financial transactions. The resulting revenue was used to cushion consumers by subsidizing energy prices.

Argentina ‘s comeback really depends on keeping the peso valued to encourage exports, at a rate of roughly 3-to-1 against the dollar. That has boosted shipments of everything from red wine to corn while protecting local industries by making imported products more expensive. Strong growth in Asia also has lifted to historic highs prices of key Argentine commodity exports such as soybeans and wheat.

Amid the bounty, the government has run twin surpluses in its budget and trade accounts, avoiding the country’s traditional trap of overspending and debt. By last month, when Kirchner’s wife, Cristina, was elected to succeed him, unemployment was less than half the post-crisis high of 22%. The poverty rate had fallen to about 26% from 58%.

“There’s no domestic or international reason to think Argentina can’t continue to grow at very high rates for the next 10 years,” says Marco del Pont.

Seeking foreign investors

Not everyone is convinced. Argentina ‘s business community, while welcoming the robust growth to date, is desperate for the new government to embrace a midcourse correction. They say the post-crisis recovery benefited from industrial capacity that had been built up during the 1990s. With little capacity added since then, the economy is beginning to run up against its limits, they say.

“They need to move to a more orthodox policy to build a better climate for investment,” says Manuel Solanet, president of Infupa, a Buenos Aires mergers-and- acquisition firm.

Investment as a share of gross domestic product has almost doubled to 22.6% from its post-crisis low of 12.5%. But that remains below the 25% the government believes it needs for the economy to reach a sustainable long-term growth pattern. And almost two-thirds of recent investment has gone to residential and commercial construction rather than modern infrastructure, such as ports and roads, or new factories.

The construction boom has benefited people such as Issel Kiperszmid, president of Dypsa International, a real estate developer. In 2001, his firm scrambled to stay afloat. Today in his office in the trendy riverside Puerto Madero neighborhood, with its exposed brick and trickling fountain, Kiperszmid oversees construction on 13 separate residential and commercial projects. “I am very optimistic about the future,” he says, smiling across a sleek black desk.

About half of the 360 units in his triple-tower Renoir project have been sold, he says. More than half of his buyers in recent years have been foreigners, willing to pay $150,000 to $800,000 for a pied-à-terre in Buenos Aires .

The charms of one of Latin America ‘s most alluring cities are sufficient to attract Kiperszmid’s customers. But the government’s full-throated populism, and its debt default, has discouraged major corporations from putting down roots here. The past three years, annual foreign direct investment has averaged just $4.8 billion, well below the double-digit levels of the 1990s.

Beatrice Nofal, president of ProsperAr, a year-old government agency charged with boosting investment, concedes Argentina needs an image makeover to compete with more investor-friendly locales. “We’re trying to rebuild the reputation of Argentina after the default. … We’re working on that. It’s a challenge,” she says.

To its critics, the government’s most glaring failure has been on inflation. With unemployment high and factory utilization low, the economy was able to grow fast in the immediate aftermath of the default without triggering price increases.

Now, however, prices are rising — by exactly how much is under dispute. The government’s official statistics agency, INDEC, pegs inflation at about an 8% annual rate. But the government’s handling of the supposedly non-partisan office — first seeking earlier this year to devise a new way to measure the consumer price index, then firing the agency head when he balked — has shredded its credibility. Independent estimates of the inflation rate range from 15% to 20%.

“The CPI released by INDEC is no longer reliable (and, as a result, other figures, including measures of economic activity, are now under suspicion),” Barclays Capital wrote in a recent note to investors.

Kirchner also prompted head-shaking last month by publicly demanding that banks lower interest rates. With prices in the fast-growing economy already rising uncomfortably quickly, making credit less expensive seemed exactly the wrong thing to do.

For their part, Argentine officials reject the conventional view that growth in the money supply determines an economy’s inflation rate. Instead, they embrace the so-called structuralist view, which holds that inadequate supply of goods (rather than excess demand) lies behind inflation.

Rather than use interest rates as the chief inflation-fighting tool, they concentrate on promoting competition and boosting productive capacity. They also appear willing to live with double-digit inflation if the alternative is slowing the economy.

An economy in transition

As the grumbling grows in Argentina ‘s financial community, some in the government insist that the country shouldn’t be judged by the same criteria as fully developed economies such as the United States or European Union. Interest rates, for example, are less important here in determining economic growth because 90% of transactions are conducted in cash.

“This is still an economy in transition. … The plane has not reached its cruising altitude yet,” says Martin Redrado, the governor of the central bank.

Officials say that extraordinary measures were needed beginning in 2002 to revive a near-dead economy. An activist state had to employ all sorts of powerful medicine — price controls, presidential jawboning, subsidies — to bend the market to its will. They recognize that, in the long run, Argentina can grow at an annual rate of 5%, not the better-than- 8% rate of recent years.

Despite the mounting concerns, no one is predicting an early crisis. Both high inflation and energy shortages are regarded as stiff challenges that will test the new president’s political dexterity and policy acumen — but not as disasters in the making.

In a few more years, perhaps as it marks a decade after the 2002 collapse, Argentina may even be ready to pursue more conventional policies. ” Argentina is not yet a normal country,” says Redrado. “We are trying very hard to be a normal country, (and) we are on the way.”


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I update this blog more often.


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