Global Glance: December 14, 2015

A quick look at intriguing international stories

By John Bostwick, Managing Editor, Radius

Welcome back to Global Glance. This week we look at:

• Turkish and Russian expats in the wake of November’s jet-downing incident
• Why the US Export-Import bank is back in business (for now)
• A content goldmine for econ nerds

Turkish and Russian Expats in the Wake of November’s Jet-Downing Incident

There are many factors that employers and employees should consider when planning for an expat assignment, from complying with home- and host-country tax obligations to preparing for cultural differences. That said, some factors may be difficult or impossible to predict, such as natural disasters or sudden political turmoil. An article in last Wednesday’s Radio Free Europe/Radio Liberty addresses the last of these. Specifically, it explores how the downing of a Russian jet by Turkey last month has affected Russian expats living in the coastal city of Antalya.

According to RFE/RL, some 40,000 Russian expats live in Antalya, many of them working in the tourism industry. The article indicates that among the city’s Russian transplants, “there is … an outpouring of concern that politics might encroach on their daily lives,” and that some have already experienced negative fallout. One Russian expat quoted says she was recently “confronted by a group of Turkish men who shouted obscenities and threatened to hit her.”

As RFE/RL also reported this month, Turkish expats living in Russia are facing similar hostilities following the jet incident. The article highlights how politics can suddenly change not only the personal lives of expats, but their economic realities. It indicates that “the [political] dispute appears to spell the twilight of Turkish business in Russia and the country's dominant role in the construction sector.”

That seems a harsh note to end on, especially since there are typically so many positive aspects related to expat assignments, including opportunities for cultural enrichment. For another side of expat life in Turkey, check out this article published last Tuesday in the English-language Turkish newspaper Daily Sabah. It describes how a handful of expats in Turkey have “dedicated themselves to Turkish cuisine while sharing their skills as well as recipes with fellow expats in their own cooking classes.”

US Export-Import Bank Back in Business

Back in September, we mentioned GE’s surprising decision to move hundreds of manufacturing jobs to France. According to a GE press release, it resulted from Congress’ decision to let the authority of the US Export-Import Bank (Ex-Im) lapse. Ex-Im helps finance the export of US goods and services to global markets, and GE indicated in its release that “without customer access to [Ex-Im], we have no choice but to move our work to places that will offer export credit financing of these projects.”

Ex-Im remained in a state of limbo until early this month. On Friday, December 4, Chairman Fred Hochberg posted a letter on the Ex-I’m website explaining that “after overwhelmingly bipartisan votes in both the Senate and the House of Representatives, President Obama signed Ex-Im Bank’s reauthorization into law today.” The letter indicates that the reauthorization will remain in effect until September 30, 2019. The web page that shows the chairman’s letter also has a helpful FAQ tab that explains the reauthorization and what customers and other stakeholders can expect now and in the immediate future.

For a good summary of the situation, check out this article in The New York Times, which has some of the political background, including why some conservative Republicans still oppose the bank and how there remains an outside chance they’ll be able to “kill” it despite the reauthorization. The article explains: “With three empty seats on its five-member board, the bank lacks a quorum. Until Mr. Obama nominates members, and the Republican-controlled Senate confirms them, Ex-Im Bank can only approve small export deals, not the big orders for aircraft, satellites and major manufacturing equipment the bank is best known for — leaving the likes of Boeing, General Electric and Caterpillar in limbo.”

For more, check out this Wall Street Journal interview with Ex-Im chairman Hochberg, which appeared last Tuesday but (I think) was conducted on the day President Obama signed the reauthorization. In the interview, Hochberg emphasizes Ex-Im’s increased commitment to US small businesses, no doubt at least partly in response to criticisms that the bank provides corporate welfare. Here’s Hochberg: “Our job once the president signs the reauthorization is to go out and start meeting with the private sector bankers, private sector insurance brokers, meeting with exporters in this country, meeting with customers overseas to say, ‘We’re here. We’ve got a full four years ahead of us.’ And particularly [to reach out] to the small business community, because Congress did mandate a larger portion of our authorization to go to them.”

A Content Goldmine for Econ Nerds

Stop the press, I’ve just hit the motherlode of econ content. Here’s a random sample of what’s on offer at the International Monetary Fund website: an hour-and-a-half long video of a lecture on the history of US debt limits by Nobel Prize-winning economics professor Thomas Sargent; a 1,500-word blog post, complete with three charts, on the correlation between fossil-fuel prices and carbon emissions; and an article on China’s ongoing adoption of accrual accounting.

The site has two different blogs in English, one in Spanish and one in Arabic. It has podcasts, many regular periodicals available for PDF download, educational videos and on and on. The site itself can be read in seven different languages. Just trying to summarize the enormous amount and variety of its content is challenging. And it’s all free. Seriously, if you have the slightest interest in economics, visit this site, though you’ve been warned that it’s a virtual rabbit hole.

It’s probably worth closing this section with a description of what the IMF actually does, since, let’s be honest, most of us don’t know. You could read the IMF’s "About" section, but I prefer this BBC.com profile on the IMF and the World Bank. Here’s an excerpt: “The IMF aims to preserve economic stability and to tackle — or ideally prevent — financial crises. Over time, its focus has switched to the developing world. … The IMF is funded by a charge — known as a ‘quota’ — paid by member nations. The quota is based on a country’s wealth and it determines voting power within the organization; those making higher contributions have greater voting rights. The Fund acts as a lender of last resort, disbursing its foreign exchange reserves for short periods to any member in difficulties.”

Given the fact that there’s a correlation between wealth and voting power, it’s not surprising that the IMF has been subject to negative criticism over the years. The BBC piece is also good on this (or at least less overtly biased than many articles I’ve discovered while doing research). Here’s another passage from the BBC profile: “Protesters and critics [of the IMF] are largely united in their distaste for globalization: broadly speaking, the integration of world economies. They cite the exploitation of the poor and the environment and argue that freer trade threatens the livelihoods of millions of people.”

By the way, I started poking around the IMF site because a coworker sent me this short piece on the current state of Sweden’s economy. The IMF conducts ongoing country, regional and global surveillance, and the Sweden piece is part of the IMF’s annual country-specific “Article IV consultations" (which sounds like a term that might be bandied about the bridge of the starship Enterprise). Per Article IV of the IMF’s Articles of Agreement, each year the IMF sends a team of economists to a country “to assess economic and financial developments and discuss the country's economic and financial policies with government and central bank officials.”

Speaking of econ nerds and Star Trek, if you’ve ever pondered the differences between geeks and nerds, check out this fascinating, enduringly popular blog post by research scientist and software engineer Burr Settles. Basically, he uses two sources of Twitter data to create a chart showing various words (e.g., “boxset,” “startrek” and “ironic”) and how closely they correlate to the terms “nerd” and “geek.” (I always thought I trended more towards geek than nerd myself, but after looking at the chart I’m not so sure.)