The Finance Minister Tendai Biti admitted “Under the current multi currency regime, the inadequacy of smaller denominations has posed a number of challenges in transactions.” Nonetheless, the economic commentator Bekithemba Mhlanga told VOA Studio 7 reporter Gibbs Dube that the country needed to adopt the rand as its principal currency to hold down large importation costs of notes and coins. “Zimbabwe will fail to import all these required small denominations if it does not adopt the rand,” Mhlanga suggested.

The Zimbabwean government dumped the local currency last year in favour of the US Dollar, the South African Rand and the Botswana Pula as the political crisis and economic meltdown triggered record-breaking hyperinflation. Even though the currency situation improved after it adopted multi currency system the cash flow got impeded in view of US embargo pressure and poor returns from investments.

The acute shortage of foreign currency in the country has even deterred many Zimbabweans from depositing their money in banks. Some reports claim that people are literally washing the dirty US dollar bills to extent their lives in circulation.

The US Federal Reserve destroys about 7,000 tons of worn-out notes every year, and it is estimated, the average $1 bill circulates in the US for about 20 months. Though larger denominations are less dirtied since they are either from banks or international trade, smaller denominational US currencies outlive the estimated circulatory cycle in Zimbabwe.

Interestingly, the retailers have resorted to requesting shoppers to take other goods in exchange of change, and in some cases ‘credit notes’ replaced the balance of small change. Such credit notes even entitled shoppers to redeem them at a later stage for more goods from the issued shops.

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This development has given rise to the market forces to flex its muscles in pushing up wages, and eventually eating up the profit margins. In addition, the narrowing of gap on the outlay of wages with other competing markets has also reflected up on the product prices, which have become higher as compared to other markets.

Surprisingly, though the total labour force of China is about 800mn, very few workers have the required qualifications. It should be recalled, C.P. Lee, Asia-Pacific human resources chief at Motorola Inc. had observed “The skills base does not meet the demands of a rapidly growing (Chinese) market.”

In a rising wages scenario, the Chinese Companies cannot survive in the global market without providing cheap products to its clients, which was the core competency of most Chinese manufacturers hitherto. With that, majority of the Chinese firms will be compelled to shift from the earlier strategy of producing cheap products to quality ones as the market for the cheap products may not exist in future. The absence of cheap goods market will leave the Chinese companies with only one option of leveraging through tapping the available ‘quality’ over a quantity product market.

Hence, to grab new buyers whom seek quality products, the manufacturing companies while dishing out higher wages will also be forced to retain or recruit competent labour force to produce superior quality products. The higher wages which trigger job losses will equip the existing companies the liberty to choose the best from the competitive labour market to cater to the new quality-preferred clientele.

Incidentally, it goes without saying cheap labour often adversely affects the efficiency of the workforce, and the China growth story is an example to that premise. China’s strategy to garner market share was always been associated with manufacturing more quantity while often blowing to the wind the standards of quality.

So as former chief Asia economist at Citigroup Inc., Huang Yiping’s contention, China may be heading for the so-called Lewis turning point, but the silver lining would be that the country would also be in the process of becoming a “quality global factory”. Huang was referring to the economic theory by the late Nobel Prize-winning economist W. Arthur Lewis where manufacturing competitiveness and the pace of growth begin to turn down as labour costs rise.

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The US consumes nearly a quarter of the world’s oil production but just produces about 10 percent. It buys around $400bn worth of foreign oil or about the same as last year’s balance of payments deficit with its trading partners.

One of the companies that has established itself in used cooking oil energy domain is Minnesota-based Restaurant Technologies (RTI), the leading provider of bulk cooking oil management services to the restaurant industry. RTI has generated $240mn revenue by collecting used cooking oil, and more than 100mn gallons of used oil have been sold to biodiesel manufacturers, animal feed and other buyers.

Likewise, the Shakopee Mdewakanton Dakota Community has recently celebrated its first anniversary of producing bio-diesel from waste soybean oil used in frying chicken, French fries and other foods. The bio-diesel is used to fuel shuttle buses that transport guests and employees among properties around the community. The success of the tribal community on implementing the bio-diesel program indicates that it made economic and environmental sense virtually practical even for small communities to engage in such initiatives.

The Dakota community extracts bio-diesel by pumping 100 gallons into the BioPro 380 processor at a time. Twenty gallons of methanol (wood alcohol) and small amounts of potassium chloride and sulphuric acid are added to the machine with minimal usage of vinegar late in the process. About 48 hours later, around 95 gallons of biodiesel and 25 gallons of glycerine are produced.

Last week, East Ridge, Tennessee has decided to utilize a self-produced new biodiesel blend to fuel its city operations fleet. It is estimated that this clean alternative to conventional fuel not only would make the air cleaner in East Ridge but also expected to provide revenue, eventually helped to lower taxes.

As per the program, the residents may pick up or drop designated or non-designated collection containers at any East Ridge Swap Center. These containers, once full with cooled used cooking oil—may be exchanged for an empty one. By switching to a biodiesel blend, the city of East Ridge is expected reduce its operating costs on civic amenities such as garbage collection, mowing, roadway maintenance, fire/rescue and street sweeping.

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Whether the EU saves itself from present crisis or not, there are many things to be absorbed by the new unions in the making much before taking the plunge. Primarily the alert system, deliberated by the EU to give powers to the parent body to ‘semi-audit’ tasks to monitor budget discipline not only of national governments but also of regional and local bodies, would ensure better transparency. This could prevent governments from hiding grey areas of decentralised budget appropriations, which was partly the case with Greece that stands accused of having lied about its accounts for years.

Besides, periodical evaluation of state affairs including politics based on ground realities and pre-set stitch in time solutions should be in place to ward off the dangers of any of the member-state getting weakened beyond manageable proportions. Projections and goals have to be marked by success failing which should attract stringent punitive measures; something that Brussels is planning to impose on members whose public debt is running out of control.

Furthermore, the member-states should make constant efforts to bring down their debts, which have been proven possible by countries like Belgium and the UK in the past. Before the global meltdown, Belgium managed to reduce its debt to 84.2 percent of GDP in 2007, down from a peak of more than 130 percent in the early 1990s. Likewise, the UK had a debt peak of 300 percent of its GDP after the Second World War, which had been gradually reduced to 33 percent by 1990.

There is also much to be imbibed from the off-target response such as ‘Europe 2020′, which is looked at sceptically by the Eastern EU members and criticized by German Chancellor Angela Merkel for contrasting reasons. The objectives of ‘Europe 2020′ include fight against poverty, increase in education and employment rate.

The proposal unveiled by the European Commission in March highlighted on poverty alleviation calling for reduction in the number of Europeans living below the poverty line by 25 percent, lifting 20mn out of poverty from the current 80mn. However, such policies with progressive milestones should be included right from the beginning and should be modified time to time with ‘proper’ budgetary allocation.

The EU’s new strategy for sustainable growth and jobs, ‘Europe 2020′, comes in the midst of the worst economic crisis in decades. The new strategy replaces the Lisbon Agenda, adopted in 2000, which largely failed to turn the EU into “the world’s most dynamic knowledge-based economy by 2010.” Nonetheless, the new proposal puts innovation and green growth at the heart of its blueprint for competitiveness and proposes tighter monitoring of national reform programmes, one of the greatest weaknesses of the Lisbon Strategy.

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