Where's Yer White People Now? On 'Saving' Egypt

I borrowed the line in the post title from The Ten Commandments when the Hebrews were being persecuted by the Egyptians: "Where's your Moses now?" Nowadays, I'd like to ask the current Egyptian leadership--especially the Muslim Brotherhood--something similar: Where's yer IMF white people now brandishing $4.8 billion? Daily reports emanating from Egypt talk about an economy teetering on the brink of collapse. I guess those "Internet Freedom" fantasists did not reckon that the dupes who supposedly tweeted their way to overthrowing Mubarak didn't imagine that those "bad old days" of dictatorship could now be the "good old days." Bravo; what an improvement.

Although I have written much about the "Internet Freedom" folly of Egypt, there is more to be said (unfortunately). The Christian Science Monitor points out something I hadn't recognized before but is surely true: Given that the government uses Egyptian pounds to fund food and energy subsidies, the currency's further depreciation will only make it more difficult to fund the purchase of these (usually imported) goods. So...

The pound had steadily declined since Mubarak was pushed from power with the country's grim economic outlook straining its foreign reserves. Billions in hard currency have been spent by the central bank trying to protect the country directly, as well as on wheat and fuel imports that the government subsidizes for domestic consumers. But notice my use of the word "had." Of late, the pound's decline is no longer "steady." Since about Jan. 13, the pound's decline against the dollar has been precipitous.

That's particularly dangerous for Egypt, since so many dollar-dominated commodities are subsidized by an Egyptian government that receives most of its revenue in pounds. In other words, every bushel of wheat or barrel of oil that the government purchases is far more expensive in domestic terms, which in turn further depletes the government's foreign currency reserves, makes investors even more nervous about the chances of a pound collapse, and so puts more pressure on the pound. The very definition of a vicious cycle. 

Actually, Egypt not confronting the matter of subsidies head-on is quite a problem in itself. If I may elaborate on the formulation above:

1. The Islamist government refuses to roll back subsidies as demanded by the IMF so it may avail of a $4.8B bailout;
2. Other lenders supposedly waiting on the sidelines for an IMF deal as a seal of good housekeeping do not want to contribute absent an IMF program;
3. The deteriorating political climate causes further falls in the value of domestic currency
4. As the political climate gets worse, subsidy removal insisted upon by the IMF becomes an even more remote prospect; return to (1).

Nobody likes these things to happen. However, I am dismayed by the Muslim Brotherhood-dominated government counting on its superior organization to win elections claiming this to be the "democratic" result. I am equally dismayed by the Internet fantasists who long insisted that the overthrow of Mubarak was "democratic" and would lead to better outcomes. There is nothing of that sort.

As I said, where's yer white people now with $4.8 billion? Will the clerics even approve of Egypt taking this money? Perhaps religious fundamentalists (the Brotherhood) and economic fundamentalists (the IMF) don't mix, but they haven't even gotten that far to even consider the issue.

UPDATE: The ever-elusive IMF deal is now said by Moodys to occur in 3Q2013 at the earliest. Dig the "tough sell" line about gaining public approval--it's my understatement of the day. Let's say I am not holding my breath.

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Too Long in Exile: ADB's Kuroda Next BoJ Guv'nor?

It is curious that Western financial new media is finally paying attention to Asian Development Bank President Haruhiko Kuroda. Despite being the head of the most prominent regional lender in our part of the world, he has so far toiled in relative obscurity outside Asia. How obscure is he? His Wikipedia entry consists of two sentences despite being the ADB chief since 2005 [!] Talk about the stereotypical faceless Asian bureaucrat and you may have his photo in there somewhere.

Still, he is now being portrayed as the front-runner in becoming the next Bank of Japan chief since his views are similar to those of PM Shinzo Abe. Besides, he is said to command the support of the opposition DPJ as well, paving the way for his nomination. Kuroda is quite Asian in the sense that he does not hesitate from actively intervening in the markets if the situation calls for it:

As Japan's top financial diplomat from 1999 to 2003, he aggressively intervened in the exchange-rate market to weaken the yen to support the country's export-reliant economy, a sign he will be keen to keep any sharp yen rises in check. He has called for the BOJ to achieve its 2 percent inflation target in two years by pumping money into the economy through unorthodox steps, such as expanding government bond purchases and buying shares. Inflation in Japan has rarely reached 2 percent since the early 1990s.

Ironically, Kuroda is believed by many in the ruling LDP to be ideal for the job precisely because he has spent so much time cottoning up in absentia to the movers and shakers of Asia and beyond as ADB president. Despite gaining next to no attention elsewhere, rest assured that the Manila-based lender commands considerable clout in the Pacific Rim. Quoting PM Abe:

“(We want) someone who can articulate (Japan’s policy) in the inner circle of international finance and win understanding (from foreign countries),” he said. “Someone who can use theory to counter criticism against monetary policy is needed.”

...and here:

Mr. Kuroda’s global experience — as vice minister for international affairs at Japan’s powerful Finance Ministry from 1999 to 2003, and as president of the Manila-based Asian Development Bank starting in 2005 — could also help Tokyo navigate foreign criticism that its monetary policies are intended to weaken the yen to give Japanese exporters a competitive edge.

I ultimately believe that Japan will be aiming to weaken its currency regardless of who takes the job of BoJ governor; it's just that they believe the diplomatically assured Kuroda will be more able than his putative competitors to smooth ruffled feathers. See, for instance, the Koreans complaining about Japan re-engaging in currency war by using unprecedented measures to reflate the Japanese economy.

There is, however, a catch: Japan's grip on the Asian Development Bank has actually increased in recent years despite its fading economic fortunes. Together with the United States, Japan is co-largest shareholder in the institution, but Japanese officials like Kuroda are far more involved in its day-to-day operations. Moreover, China has made limited inroads at the ADB despite surpassing Japan as the region's largest economy. In no small part, Japanese regional influence is strongly conditioned on being able to choose the bigwigs at the ADB. In turn, Kuroda's stewardship of the ADB is believed to be a decisive factor as to why Japan's sway over it remains strong. Pulling him out midway through his second five-year term as ADB president may not bode so well for Japanese influence at the institution:

Abe advisers say Mr. Kuroda's main weakness is his apparent indispensability in his current position—president of the Asian Development Bank, a post he has held since 2005. He is less than two years into his five-year term.

Some Japanese officials worry that if Mr. Kuroda leaves early for the BOJ slot, Japan risks losing the perch it has controlled since the founding of the Manila-based institution in 1966. For Japanese finance officials, the ADB is Japan's equivalent of the World Bank for the U.S. or the International Monetary Fund for Europe—an international financial institution they expect to run, a platform for global influence. Losing the ADB for Japan would be a blow, especially at time of growing insecurity about the country's diminished standing in the region. 

I simply do not think that erosion of Japanese influence at the ADB will happen overnight even if Kuroda is pulled out in a last-ditch effort to reflate Japan's economy. It will remain the institution's top shareholder and Japanese officials will still hold key positions. On the other hand, if Kuroda's successor proves unpopular, you never know if others can muscle in on turf the Japanese have long held to be their own.

2/27 UPDATE: The deed is done. Kuroda has been nominated to succeed Shirikawa.

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Japanese Stimulus: Enough White Elephants Yet?

When it comes to the most pigheadedly wasteful spending to supposedly jump-start an economy, portly and profligate Americans only have one serious rival: the Japanese. Granted, the Japanese have been attempting to escape stagnation for over two decades now instead of America's one. Still, the sheer pointlessness of their entire endeavour is something to behold. In contrast to America's infrastructure which is on par with that of Damascus after the umpteenth rebel mortar assault--the American Society of Civil Engineers gives the US a "D" and estimates $2.2 trillion needs to be spent--Japanese infrastructure is nowhere near as dire.

That hasn't, however, stopped the Japanese government from embarking on massive ("shovel-ready"?) construction projects time and again in the hopes that they will provide the foundations for Japan's recovery. With the LDP back in power, doling out projects to favoured contractors is once again on the agenda, with more train routes, bridges, and highways to nowhere on the drawing board. Throw in various ports and stations used once in a blue moon and you have white elephant projects up the wazoo. As the Reuters article notes, the "challenge" posed by PM Shinzo Abe is spending $100B in 15 months on infrastructure:

"We cannot simply continue to build roads and infrastructure the way we used to at a time when the population is ageing and shrinking," says Takayoshi Igarashi, a public policy professor at Japan's Hosei University who has advised the previous Democrat administration on rebuilding from the 2011 earthquake, tsunami and Fukushima nuclear accident...

Since he took power in December, Abe has earmarked 10 trillion yen ($107 billion) for new infrastructure and upgrades over the next 15 months - half of it funded by government debt. That is equivalent to a quarter of the amount that the Organisation for Economic Cooperation and Development estimates the entire world needs to spend on transport infrastructure each year.

Government spending is a classic remedy for weak growth. But it is one Japan has tried over and over - pouring roughly $2 trillion into concrete and steel since 1990 in a vain effort to resuscitate the economy, now in its fourth recession since 2000. Economists warn that, without reforms to lift Japan's long-term growth potential, more such spending will produce only a temporary jolt that swells a government debt already worth more than double national output...

It's not as if Japan needs yet more infrastructure when there is already much more than necessary to get around?

The world's 61st largest country, Japan has 1.2 million km (745,000 miles) of roads, the world's fifth-largest network. It has 680,000 bridges, almost 10,000 tunnels, 250 bullet trains and 98 airports. Government critics have long derided many as white elephants - unnecessary, costly and environmentally harmful. The airport in Ibaraki, 85 km (53 miles) north of Tokyo, for example, opened in 2010 at a cost of about $225 million as a hub for low-cost carriers. Today, it handles just six flights a day. Construction of the nearly $5 billion Yanba Dam in northwest Japan began in 1967 to help power the needs of a growing population. With Japan's population now shrinking, it remains unfinished 45 years later. 

And there may be hundreds of billions more in spending in store

Yet the money represents only what Abe hopes to spend by April 2014. He has suggested spending similar sums every year for a decade - if he holds onto power that long. With the private sector and local communities expected to match government investment, this would add up to 200 trillion yen ($2.16 trillion) over 10 years - or roughly 40 percent of GDP.

Last, there will be no one to use all this new infrastructure as a shrinking population implies a shrinking workforce. Perhaps there won't even be enough folks to build all these white elephants:

It is not even clear who would use all of the new infrastructure, or even who would build it. Thanks to Japan's low birthrate, the population is declining by more than quarter of a million a year, government statistics show, with its working-age population shrinking at double that pace. According to Health Ministry projections the number of Japanese is expected to fall by nearly a third, to below 90 million, by 2060. That means fewer cars on Japan's roads. Japanese automotive research company Fourin Inc. estimates car sales in Japan will fall from nearly 5.4 million last year to 4.5 million in 2020, and to about 3 million a year by 2040. Japan's construction workforce is also shrinking: today it is a third smaller than in 1997 and building firms are already having trouble finding workers to rebuild areas from the 2011 disaster.

I've suggested that mass immigration [1, 2] is a much more promising solution to reversing Japan's demographic woes and quite possibly its deflationary ones as well, but that's never quite been on the cards. See if all these public works projects make a difference; I honestly cannot see why they will now when they did not before.

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Redefining 'Lame': Proposed EU-US Trade Deal

If you're wondering about scant coverage of the proposed EU-US FTA in what purports to be the IPE Zone, nobody said that I had to cover rather pointless trade deals. While I am not entirely indisposed to doing so, the ones I do mention at least have some entertainment value alike the (rather unlikely) EU-MERCOSUR deal which has been decades in the pipeline. Unfortunately, an EU-US FTA ranks right up there with a New Kids on the Block reunion on my radar screen. Who the £$%^ cares? The overall premise is overwhelmingly underwhelming. Let us count the ways:

(1) Exporting stuff nobody buys at home because folks are hard up doesn't assure sales abroad when your trade partner is equally hard up. The underlying premise of this FTA, trade creation, is highly dubious. We owe a debt of gratitude to none other than Karl Marx in the stupefaction sweepstakes evident here: We know that both the EU and the US are terminally stuck in reverse gear. Both economies are shrinking. Household incomes in both have been stagnant-to-declining for well over a decade. Hence, lowering trade barriers doesn't really matter when there's not enough money to go around despite unprecedented easy money policies on both sides of the Atlantic. Why are we to believe that ridding EU-US trade of the negligible 3% average tariffs remaining will result in much of anything when trillions in stimulus-- far greater inducements to consume--have failed to get these economies out of their respective ruts? Peugeot cars selling well in America--dreaming is free, no?

You'd think that countries go abroad in search of more promising markets than those at home once they reach saturation alike what Marx said, but here you have two equally saturated markets wishfully thinking that salvation lies in each other. You keep dreaming.

(2) Stated potential gains from this FTA are likely overstated. People clowning with DGSE models is usually the source of wildly overestimated gains from lowering trade barriers. It has been some sort of pastime estimating gains (if any) from this FTA.  I am thus astounded that the claimed gains for both sides exceed some that I've seen made for the completion of the (global) Doha Round. It's easy enough to get a hold of the software, set optimistic parameters and wind up with trade creation figures in the tens of billions and I suspect that's what's going on here.

(3) Tariff lines won't be negotiated where they are highest--in agriculture. European agricultural subsidies are, in a number of ways, even worse than already-high American ones. The assumption going in is that both parties will want opt-outs for their respective agricultural lobbies. End result? No progress where substantial reductions in tariffs actually are possible.

(4) Most of the expected gains lie from reducing non-tariff barriers alike through standards harmonization. The EU admits as much:

Given the low average tariffs (under 3%), the key to unlocking this potential lies in the tackling of non-tariff barriers. These consist mainly of customs procedures and behind the border regulatory restrictions. The non-tariff barriers come from diverging regulatory systems (standards definitions notably), but also other non-tariff measures, such as those related to certain aspects of security or consumer protection.

Once again, think of agriculture. Famously, the US has had no luck gaining access for its genetically modified foodstuffs and meat products using beef hormones in European markets. I doubt whether the Europeans are willing to make significant concessions over these issues now when they have not been willing to do so before. Moreover, why are we to believe that, say, harmonizing automobile crash safety testing is going to unlock the sales of Peugeots Stateside multiplied across dozens of other industries?

(5) Canada has been negotiating an FTA with the EU for four years now with limited progress over issues that will almost certainly reappear when Europe negotiates with the 10x larger United States. Chances are that discussions will be even more contentious given the money at stake. The EU-Canada deal isn't exactly a promising precedent. From Reuters:

EU Trade Commissioner Karel De Gucht had hoped to wrap up talks for a free-trade agreement with Canada in Ottawa in early February, when he met his Canadian counterpart Ed Fast. But negotiations are held up over contentious issues including agricultural exports, intellectual property and the ability being to bid for government contracts on both sides of the Atlantic. "What was on the table was simply not feasible," De Gucht told the European Parliament's trade committee, when asked by one lawmaker to explain why a deal had not been reached. "On a number of issues they will have to make additional exceptions," he said, referring to the Canadians.

Also consider that negotiating this deal would terminally wound the Doha Development Agenda and you must wonder how desperate the brokeback Yanks and their European counterparts have become. Make no mistake that they would not have even proposed going down this road if things weren't so bad that they are now trying to make lemonade out of the lemons they've been dealt with.

Here is my fearless prediction: There will be heated negotiations--and perhaps even a done deal sometime around when Obama (mercifully) exits. Even so, it will all have been for not much of anything in the end.

If this is the rescue plan for both America and Europe, they are as delusional as they come.

(6) 2/23 UPDATE:  To throw another monkey wrench into the proceedings concerning (surprise!) agricultural products, the EU has now applied blanket tariffs against US bioethanol exports over "dumping":

The EU will place a duty on all U.S. bioethanol imports to the 27-nation bloc from Saturday, in a move that has prompted Washington to express "serious concerns" and that comes as both sides prepare to launch negotiations on a free-trade deal. The European Union will levy a 9.5 percent tariff on all bioethanol coming from the United States, the bloc's Official Journal said on Friday, concluding a 15-month investigation that argued U.S. bioethanol was being dumped, or sold below cost.

Since most bioethanol is a component in blended fuel, the ruling sets a fixed charge of 62.30 euros ($82.38) per net tonne of bioethanol present in fuel. Brussels says that U.S. incentives to produce clean fuels constitute an illegal subsidy under world trade rules, and have allowed U.S. producers to sell cheap fuel to Europe, an accusation rejected by U.S. producers. 

The US will likely appeal as FTA negotiations get underway. It's not such a good omen after so many unresolved squabbles over agricultual products, don't you think?

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2014 Sochi Winter Games = 1936 Berlin + Oligarchs?

A vainglorious leader with an authoritarian streak; a country with a chip on its shoulder against Anglophone powers; and massive Olympic spending to burnish a national reputation--where did we see all these things before? The parallels are not exactly edifying, but they're there nonetheless.

Reuters has a very interesting take on this latest Olympic boondoggle. Despite what the article mentions, I honestly doubt whether the Russians are pouring an unprecedented $50 billion into the 2014 Sochi Winter Olympics. Still, even if they spent even half that much it would be an astounding amount given that (a) it isn't the Summer Olympics which is a far more watched event and (b) Sochi isn't even a second-tier Russian city with a population of under 350,000.

There is a twist to this story, however: The Russian government, likely being ever-so-wise as to the financial calamities that have befallen any number of previous Olympic hosts, is making the Russian oligarchs foot the bill in a big way. As far as Russian politics go, we have a perverted if still comprehensible form of justice here. For, the guy who handpicked Vladimir Putin from obscurity, Boris Yeltsin, also oversaw the fire sale of various Soviet-era natural resource empires (that still dominate Russian industry) at a time when the West was foisting then-fashionable privatization of the commanding heights. It's only "fair" that the Yeltsin's main political benefactor be able to, ah, extract privileges from Yeltsin's economic benefactors.

In other words, part of the quid pro pro from all those years ago when the oligarchs were made very wealthy men out of a select few is footing the Sochi Olympics bill. It's not easy falling politically afoul of Putin as some oligarchs have found. That said, do not think the oligarchs are opening their pocketbooks willingly to the extent Putin expects them to for his pet project:

Above the Black Sea city of Sochi, one of Russia's richest men is spending billions of roubles to turn a patch of mountainside into a global showpiece. Metals magnate Vladimir Potanin has paid for new buildings, new lifts and hundreds of snow canons in the hope of transforming slopes not far from sub-tropical Sochi into a world-class ski resort. Like most of the plans to host the Winter Olympic Games next year, Russia's ambitions for the ski village and other venues are outsized in scale and ambition. Total investment to make the sleepy region fit to welcome thousands of competitors and the world's media is expected to exceed $50 billion, according to Russia's international news agency RIA Novosti. That would make it the most expensive games, summer or winter, ever staged. The 2010 Winter Olympics in Vancouver, Canada, cost a mere $3.6 billion, according to an estimate by PricewaterhouseCoopers, though others put the bill closer to $6 billion.

While Russia's President Vladimir Putin has not flinched at Sochi's eye-popping expense, some private investors and wealthy oligarchs, recruited by Putin to help foot the bill, are chafing at how much they are expected to do. In a rare challenge to the Kremlin they are demanding that the state help with the rising costs. Though precise figures on who is paying for what in Sochi are hard to obtain, RIA Novosti says private investors have spent nearly $25 billion. Federal and regional budgets have accounted for some $13 billion of the costs incurred to date, according to Deputy Prime Minister Dmitry Kozak.

The amounts we are talking about here are staggering. Q: When does a guy reportedly worth $14.5 billion complain about money? A: When the task he is asked to help complete will supposedly total $50 billion...

Potanin, whose estimated fortune of $14.5 billion makes him Russia's fourth richest man, according to Forbes, is complaining of at least $530 million of extra work his company was required to do. Now he wants the government to boost its contribution to his projects by cutting interest rates on his debt, which includes money borrowed through a line of credit with state bank Vnesheconombank of up to $750 million. "We are carrying out talks with the government on the compensation of a part of these expenditures through interest rate subsidies," said Potanin, speaking to Reuters. "Many see this as a form of government support. But actually it is only compensation for expenditures, which are not characteristic of ... commercial projects."

Oleg Deripaska, another billionaire oligarch [his boat is pretty nice I gather], has similar complaints, reflecting the complex, symbiotic relationship Putin has with Russia's rich elite. "The bargaining power is with the oligarchs until 2014, because they can come to the state for money or threaten that the construction won't get done in time," said Bruce Bower, a partner at the investment firm Verno Capital, who has lived in Russia since 2005. Putin wants the Games to project a positive image of Russia to the world and may endure the rising bills with a fixed smile, said Bower. The Russian president may hope to recoup a return on the investment later. Whether the oligarchs will as well is far from clear.

I honestly cannot see any of the participants gaining financially from this spectacle of trying to make a Potemkin Village of Sochi for international consumption. Not that many of us should be duped so easily.

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England's Comeuppance to EU Exit: Scots Exit UK

British politics are weird. No sooner did British Prime Minister David Cameron appease Eurosceptics within his party by promising a referendum on the UK remaining in the EU by 2017 that he warned the independence-minded Scottish National Party (SNP) about breaking away from the United Kingdom through a yes vote in their referendum scheduled for next year meaning its automatic exit from the EU. In other words, he is offering his compatriots a decisive break from the European project while threatening his Scottish peers that breaking away from the UK would mean they would no longer be in the EU. In one case, EU membership is cast by the same person in a negative light and in the other in a positive light depending on the audience in question. It hinges on the understanding that Scotland is far more positive about remaining in the EU than England is.

The question surrounds the meaning of nationhood for international treaties to which Scotland was privy to as part of the UK. If Scotland attains independence, will it have to go through the entire process all over again as a new nation? The weight of opinion says "yes":

The British government on Monday intensified its campaign to stop Scotland leaving the United Kingdom, publishing a legal opinion saying it would forfeit its membership of international bodies such as the European Union if it chose independence. The pro-independence Scottish National Party (SNP) that runs Scotland's devolved government plans to hold a referendum on emotionally charged subject next year, and has played down the impact of a "Yes" vote on Scotland's international status.

But the 57-page legal opinion - drafted for the British government by two independent experts on international law - said the implications could be far-reaching, likening the situation to the 1991 collapse of the Soviet Union when Russia was declared the USSR's legal successor but the 14 other Soviet states had to forge their international relations anew. The overwhelming weight of international precedent suggested Scotland would be legally deemed a "new state", it said - a scenario that would force it to re-apply to join international bodies such as the EU, the United Nations and NATO.

Scotland is also holding on to the ideas that the English will readily allow the former to keep the pound and that (declining) revenues from the North Sea oil fields will keep the new state afloat:

The government's intervention came as a panel of experts, including two Nobel prize-winning economists, issued a report saying the SNP's plan to keep the British pound in the event of independence was a sound strategy, suggesting it would also be wise to keep the Bank of England as the central bank.

The SNP argues that North Sea oil revenues combined with Scotland's fishing, farming and whisky industries would be enough to keep an independent Scotland solvent. But critics say the oil is running out, that Scotland would lose disproportionately generous British government subsidies, and that it would struggle to raise enough tax to pay its bills.

It's a neat case of "what goes around comes around" to isolationist English alike those in the ruling Conservative Party: So you want to leave the EU but don't want to allow the Scots to leave the UK, eh? You likely can't have it both ways. And here's the clinching irony of it all: If the UK voted in a (Tory-sponsored) referendum to leave the EU, English parliamentarians cannot suggest that Scotland will lose the benefits of EU membership by declaring independence since they will all have left the European Union.

As I said, British politics are weird--more so if they involve Europe.There is impeccable retro-imperial logic to it all in that Rule Britannia would of course not have tolerated supranational authority alike the EU while thinking it impossible that Scotland could ever break away.

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Of Quota Reform and American IMF Hegemony

Two things strike me as notable with the recent news that the US plans to finalize changes in the shares of quotas at the IMF and thus the voting rights there:

1. Given that the US has effective veto power at the IMF by virtue of having more than 15% of quota shares when a quorum of 85% is necessary to make a decision, it alone has the ability to unblock the quota reform process which remained deadlocked during the 2012 presidential elections at a time when it has become by far the world's largest debtor:

The Obama administration is hoping to move ahead shortly with legislation to finalize IMF voting reforms agreed in 2010, which will make China the third-largest voting member in the global financial institution, a senior U.S. official said on Saturday. The official, speaking at the end of a Group of 20 meeting of finance ministers in Moscow, said the administration was actively discussing legislation with relevant members of Congress.

The 2010 package cannot be finalized until it gets the go-ahead from the United States, which has effective veto power over the historic deal that was meant to have been approved by all IMF member countries in October last year, but was stalled by the U.S. presidential election.

2. For all the hullabaloo about China becoming the IMF's third-largest shareholder and giving LDCs more of a voice in the institution, its head remains a European by tradition. What's more, the ultimate percentage of quotas shifted from developed countries to developing countries is actually not all that large at--wait for it--a 6% realignment:

This completes the 14th General Review of Quotas with an unprecedented doubling of quotas and a major realignment of quota shares—a shift of more than 6 percent from over-represented to under-represented members and a more than 6 percent quota shift to dynamic emerging market and developing countries. 

Why does it take so much time to accomplish relatively little?

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