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Goodbye to a year of calamities

By Martin Khor (China Daily)
Updated: 2010-12-31 08:13

This year has been one of natural calamities, when nature showed its power and humanity across the world had to cope with the consequences.

The year started with the Jan 12 earthquake in Haiti, which killed an estimated 223,000 people and rendered 2 million homeless, with widespread cholera now one of its many effects. Quakes also struck many other areas, including Chile and China (April), Sumatra in Indonesia (April and October, accompanied by a tsunami that killed hundreds) and Iran (December).

There was extensive flooding, too. The most devastating was in Pakistan, which affected 20 million people and a fifth of the country's land area, causing $10-20 billion in damage. Floods and mudslides also wreaked havoc in China, India, Bangladesh, Indonesia, Thailand, Malaysia, Colombia, Venezuela and other countries.

There were other weather extremes such as a big heat wave in Russia and forest fires, and heavy snow in Europe and blizzards in the United States East Coast toward the end of the year, which disrupted air, rail and road traffic.

The most notable man-made environmental disaster of the year was the spilling of 172 million gallons of oil by a BP offshore rig in the Gulf of Mexico.

Worldwide economic losses from natural catastrophes and man-made disasters reached $222 billion this year, more than three times last year's total of $63 billion, according to re-insurance company SwissRe. The death toll of 260,000 in natural and man-made disasters was the highest since 1976.

According to scientists, climate change made worse the extreme weather events. The severity of calamities is nature's way of warning humanity that the worse is still to come unless it changes its way of life and production.

This year has been one of the warmest since records were kept. "The extremes are changed in an extreme fashion," said Greg Holland of the US National Center for Atmospheric Research. And John Holden, the White House science adviser, said: "The science is clear we can expect more of these kinds of damaging events unless society's emissions of heat-trapping gases are sharply reduced." Both were quoted in the Associated Press article "2010's World Gone Wild".

The turbulence in the Earth's climate was reflected in the roller-coaster UN climate change conference in Cancun, Mexico, in November-December 2010, which tried to recover from the disaster of the Copenhagen conference of 2009.

Developed countries succeeded in having their way at the Cancun conference, preparing the way to downgrade their commitments while cajoling developing countries to upgrade their actions. But the battle for adequate climate actions will start anew next year.

Also turbulent were the developments in the world economy. The recovery that looked promising in 2009 became uneven in 2010. Most shocking was the sovereign debt crisis that engulfed Greece and Ireland and threatened to spread to Portugal, Spain and beyond, and even raised the question of the euro's viability.

The rapid switch in many European countries from fiscal stimulus to extreme austerity policies also began to dampen the prospects of global recovery.

In the US, the Barack Obama administration was hindered by the Republicans from giving further fiscal stimulus. The US Federal Reserve is resorting to pumping hundreds of billions of dollars into banks. But critics say most of this will be transferred abroad through investors, instead of being given to the productive sectors.

In contrast to these problems in the West, the engines of growth continued to work quite well in developing countries, especially in Asia. China and India remained in the lead, with ASEAN member states doing moderately well. Their challenge is to avoid inflation and speculative bubbles created by large capital inflows, and to maintain growth despite the demand for their exports in the West slows.

During the year, many analysts said (or feared that) the center of gravity of the world economy and eventually politics was shifting perceptibly from the West to emerging developing countries, particularly China. This theme became the topic of several new books and numerous articles in newspapers and magazines.

Hundreds of billions of dollars more were spent in 2010 to rescue fallen banks, companies and countries, especially in Europe. But financial institutions seemed to reassert their authority, with investors calling the tune as to which countries' bonds to pull out of (thus causing panic) and which countries to place money in.

The profits of banks are soaring, and bankers are fighting to restore their year-end bonuses, causing a skeptical public to wonder how quickly the situation has gone back to "business as usual", and whether the correct lessons have been learnt from the global financial crisis.

The Star/Asia News Network