Back in business - from Baghdad

I've decided to resurrect this blog from Baghdad as I am staying in Iraq for a second year. Will be posting soon.

Bye bye...for a while at least

Hong Kong has been fun but I'm moving on. I will be spending the next year in Iraq, as AFP's Baghdad Correspondent. But I'm sure I'll be blogging again before long. Many thanks to those of you who helped my google analytics returns break into steady figures. Bye for now. Arthur

Hong Kong catches the property chill

Back in July I extolled the virtues of Hong Kong's low tax economy as one of the reasons the territory was managing to confront the global downturn. Workers' earnings stay in their pockets, allowing people to spend - or save - as they please. The fact that every major economy now seems to think that cutting taxes is the way to get out of this mess seems to back up my theory, although I would argue that the likes of Britain's Gordon Brown have been rather late in waking up to reality. An illuminating report in today's South China Morning Post, however, highlights that the draft of slumping house prices is now blowing through this city's streets with 15 percent of recent buyers thought already to be facing negative equity. Having been out of town for much of the late summer it seems there now appears no doubt that the collapse of Lehman Brothers has sparked much of this gloom. My landlady - who has tenants in three apartments - tells me that dozens of people have moved out of my building since the US Treasury allowed Lehman to go to the wall. I've also noticed lately that a lot of restaurants are dropping their service charge in an attempt to keep customers coming through the doors. But it is property that is a significant factor here. Estate agencies are closing down and tenants are managing to strike better deals. With interest rates tied to the US and already very low there is not really anywhere for the banks to go here, although the government has announced several schemes lately to help those most in need. Property prices have started to fall in Hong Kong with the most recent buyers suffering the exposure to negative equity. But I can't help thinking that Hong Kong will come off less bruised than Britain. I know too many people who borrowed astronomical sums in recent years to buy houses in the UK, partly because of a media culture that made non home owners look like second-class citizens. Given that 70 percent of British jobs are in the service sector we are sitting on a time bomb, given that unemployment is expected to hit two million by the end of the year - these people will be unable to pay mortgages that they should never have been given in the first place. They are likely to try and pile payments on a credit card - if they are not already doing so - expanding an already vicious circle of indebtedness. They are not solely to blame though. Governments have applied massive pressure in recent years with ministers routinely saying that they would help people get on the "housing ladder," leaving those unable to do so feeling worthless. They did so because they thought they were in tune with the public mood and expected there was votes in it. With a few honourable exceptions, such as the LibDems' Vince Cable, they didn't have the balls to speak out. Anyone who did was seen as a leper. It's no coincidence, however, that such talk from government - which stoked an artificial British house price spike - has now ceased. It is yet more evidence that governments should see homes as places to live and take account of that fact, rather than constantly referring to prices - be they up or down - which is a giveaway reminder that the political class live in a different, insulated world from the rest of us.

On the eve of Zardari's swearing in...

ISLAMABAD, Pakistan
The election has been and gone. Asif Ali Zardari will tomorrow be sworn in as the 14th president in Pakistan's short, but often turbulent history. Saturday's secret ballot of the country's politicians was a foregone conclusion, but it was a lot of fun to send the bulletin from here that told the world that Zardari, officially, was the victor. It seems incredible that Benazir Bhutto's widower is to become leader of Pakistan. Were it not for the killing of his wife it would never have happened. Then came the fall of Pervez Musharraf, the man who thought he was essential to the survival of Pakistan. Time will tell if the ex-dictator was right. A new chapter begins tomorrow and the atmosphere is one of bemused acceptance. The newspapers here, some of which are quite good, carry adverts praising Zardari to the heavens, while many people cannot believe that "Mr Ten percent" is about to become their president. The funniest story that I have seen so far appeared in Dawn yesterday. It described how Sindh province, Zardari's southern homeland, had declared Monday a public holiday in honour of the new president. Within a few hours the provincial government was forced to cancel the day off as Zardari had personally communicated that it was inappropriate given the country's parlous state. "It's indicative of the lack of co-ordination from the start," said one of the reporters whose work I edit here, and whom has been a journalist for around 30 years. We laughed out loud at the time but, on reflection, I hope things turn out for the better.

Heading back to the Stan'

The good thing about working for a proper news organisation is that you cover, er, news. I'm currently packing my bags to head back to Islamabad for three weeks to news edit our coverage from Pakistan and Afghanistan as my friend and colleague Danny Kemp is about to take a well-earned holiday. It promises to be a fascinating mission - AFP language for assignment - with the election of a new president on September 6. Benazir Bhutto's widower, Asif Ali Zardari, looks set to replace Pervez Musharraf but that might just be the beginning of a new power struggle. The party of Nawaz Sharif, the former prime minister ousted by Musharraf in a bloodless coup in 1999, is the other partner in Pakistan's ruling coalition. He might accept Zardari as president but he'll want something in return, likely the reinstatement of the Supreme Court judges sacked by Musharraf under emergency rule last year. Zardari seems none too keen on this. Heavy politics aside I'm delighted to be going back to a much misunderstood country. Pakistan has an aspirational middle class and is full of hard-working people who just want a better future. For the past two years Islamic militants have been intent on wrecking any such path to prosperity. Having visited the country to report the death of Bhutto last December I could see that Pakistan is capable of salvation. What it needs, however, is political leadership capable of putting aside age-old squabbles over privilege and power. Only some Realpolitik will sort this out. I'm looking forward to seeing the next step of what will continue to be a long-term process.

Musharraf quits, but who will replace him?

In what must have been the most long-winded speech in Pakistani history, President Pervez Musharraf resigned today. In the office I was in a minority thinking that he would fight on. Even the guys in the Islamabad bureau were split on what would happen. I left an hour before his speech started but picked it up on Sky News when I got home. So boring and desperate were the early stages of his monologue it seemed certain Musharraf was going to fight on. In fact, I switched off convinced he was staying put. But sitting down to my laptop to check the world headlines 15 minutes later, it was there in black and white: "Pakistan President Pervez Musharraf resigns." Although "the Mush" had been under pressure for weeks I somehow thought he would persist in his battle against Asif Ali Zardari and Nawaz Sharif. But it seems he was finally out of allies. With the army hesitant to back the former General and with impeachment charges looming he threw in the towel. No one should feel sorry for Musharraf - he was a military dictator for nearly nine years after all - but he did deliver his pledge to return Pakistan to democracy in February, having left the army at the end of last year. It is also worrying to ponder who will replace him. Although Musharraf has been a limp figure of late - Zardari and Sharif are running the show despite neither of them being the prime minister - most of Pakistan's powers rest with the president under the constitution. Zardari, aka "Mr 10 percent" for the commission he reportedly took on government contracts when his late wife Benazir Bhutto was in power, is now tipped to become President. That is a scary prospect for a country that is struggling on several fronts. The economy is backsliding after years of growth; the rupee is sinking like a stone; ordinary people are toiling to afford flour and other staples; and a coalition government comprising Bhutto's Pakistan People's Party (PPP) and Sharif's allies is fragile to say the least. Then, of course, there is rampant Islamic militancy which regularly sees suicide bombings in major cities such as Karachi, Lahore and more occasionally Islamabad. In the country's northern tribal areas bordering Afghanistan fighting between militants - many of them Taliban - and government forces sees dozens and sometimes hundreds killed daily. It's a mess and it won't go away quickly. Musharraf quit because he had no support but Zardari and Sharif are hardly cult or unifying figures. It's going to be an interesting couple of weeks in Pakistan.     

Well done Mark Douglas-Home

Nice piece in The Observer today by the former Herald editor Mark Douglas-Home (click link below). 

http://www.guardian.co.uk/media/2008/aug/17/pressandpublishing.dailymail 

Nearly three years after leaving his last job Mr Douglas-Home as good as admits that he resigned over budget cuts by Newsquest, owner of the Herald Group. While I was no fan of his editorial style it is undoubtedly the case that the paper is poorer now than when he left in the autumn of 2005. His piece, published in the Observer's media and business section, is highly critical of Newsquest's "pay more get less" management policy. It is good to see Mr Douglas-Home make these remarks on the record.