Issue 15

The reason China must be in almost any discussion related to international economics should be evident: China is an economic monster which has been growing very consistently and very fast, which is both unprecedented and warning. Unprecedented because the country has the largest population in

the world. And warning because ... it has the largest population in the world. If seriously though, the role of China in the dynamics of international commerce can become too heavy, much like in the case of the United States. Not that China can become an economic threat to U.S. (there are multiple opinions

on this. Personally, I believe that we need both countries for continuous global stability). But because the risks of systematic failures get higher if major players

are recessing. It has become conventional to observe that if the U.S. sneezes, the whole world gets the flu. Will we become overly dependent

on China as well (Chinese growth is slowing down)? And how important is China's role in achieving recovery in the post-2008 reality? Only time will tell. Meanwhile, I am

providing the most relevant talking points on the rise of the Red Dragon.

PAGE 2

Red Dragon Rising

HUNGARY

NEWS

March 14, 2012, Year 2, Issue 15

the CEU Weekly

An independent publication by CEU students and alumni

Hungarians losing

interest in higher

education?

The CEU Weekly brings to

you an interview with

Ágnes Bátory, chairman of

t h e b o a r d o f

Transparency Inernational

Hung ary , ac ade mi c

coordinator of the Erasmus

Mundus Masters in Public

Policy and associate

p r o f e s s o r a t t h e

Department of Public

Policy. She also teaches

courses as Corruption and

Corruption Control and

tutors PhD students.

PAGE 7

EU versus Hungary – the next step

Page 5

Emancipation of Interna-tional Women’s Day

Page 6

Events at CEU

Page 6

The Weekly Spam Review Page 3

Student Unionism:

E Pluribus Unum Page 3

Kabul Fashion Show! Page 6 CEU

Community

Student Tip # 10

10. Get ready to attend the Alumni Reunion

Gala Dinner and the Spring Ball on May

12.. and make sure you are in Budapest for

Graduation.. a great and symbolic event

that you will get only once in a lifetime!

Hungarian Expression of the week

Phrase: Jamaika a jamaikaiaké!

Pronunciation: yama-eek-a a yama-eek-ai-

akey!

Translation: Jamaica belongs to the Jamai-

cans!

Transparency International: Hungarian state captured by private interest groups

Page 4

Transparency in

Hungary: a talk

with CEU’s

specialist Agnes

Batory

Red Dragon Rising

Page 2

the CEU Weekly

March 14, 2012, Year 2, Issue 15

OPED

What China has accomplished in the past decades is quite

extraordinary. They have built a powerful (although not very complex) mechanism of industry

and export-driven growth. Chinese manufacturers tend to produce quite rudimentary

products, although I do not in any case generalize the whole country. But the main algorithm is still simple: securing international oil

contracts to fuel the work of domestic industrial plants, large-scale production using economies

of scale, and exportation to the consumption-driven countries of USA, Europe, and to lesser extent

Japan. Now, the question from now going

forward is: to what extent did the global financial crisis change the trans-continental trade dynamics?

In particular, I wonder if the collapse of demand in the US and Europe will have a significant, prolonged impact on Chinese

exports (since there is no reason to think of the contrary). Also, I am interested to see if China decides

to intensify the technological component of its exports, i.e. to "m ove up " t o h ig h - t ech

exportation. That would begin to create not just quantity and cost-based competition with the West

(which China already excels at), but also quality-based. A number of people have told me

that the decomposition of GDP in China is likely to change, but "how" is the question here.

Obviously exportation has been the driving force. Also aggregate investment; but mostly through the

government channel and the China Investment Company. The thing is

that the Chinese consumer is getting richer, and this can rebalance the GDP composition

towards consumption. Richer people means demanding people, right?

This brings me to the increasing general level of income and standard of living. Will the

Chinese workers be willing to continue to accept low wages with the increasing overall national

welfare? Upward movement on the ladder of social status can be good for equality and the "class

warfare" kind of arguments, but not if the middle class becomes too large while the poor (which

used to do most of the outsourcing jobs from the West) refuse to take on the old work.

Here is another issue. If the Chinese consumer gets richer, then she starts to consumer more.

So, where will those goods and services come from? Will China be able with the help of economies of

scale and massive demographic opportunities to specialize (1.5 billion people, no kidding right?)

and develop niche industries to satisfy its own growing domestic demand for consumption? Or will

the demand be fulfilled by imports from abroad? Then the o b v i o u s q u e s t i o n becomes: which countries will start

to export to China? As a final side-note to a more

trade-ish discussion so far, Beijing's monetary policy. The issue here is that the Chinese currency is

artificially weak, or undervalued. This, in return, carries positive

effects on Chinese exports, which drives the economy. The way the Chinese accomplish this is by

buying up foreign currencies (US Dollars in particular) and building up a massive foreign exchange

reserves base. An appreciation of the Yuan can contract economic growth,

something that Chinese policy-makers obvious don't want. On the other hand, you have an

increasing pressure from the US and the others to let the Yuan float and thus gain more value.

While we are having all these discussions on China, American exporters on the other side of the

world need all the help they can get to help their economy recover. And the first vital step would be to

eliminate the unfair disadvantage, that is the artificially undervalued Yuan. The threat of trading wars amid the post-crisis reality is more

imminent than ever. How will the Red Dragon respond?

Rustam Jamilov CEU Business School Alumnus

From Baku, Azerbaijan

Page 3

the CEU Weekly

March 14, 2012, Year 2, Issue 15

CEU COMMUNITY

Your “corner” Have any comments, ideas, corrections? Would you like to advertise a project? Write us at

[email protected] and get yourself published!

Last March 6, CEU hosted the lecture „Student Unionism in a Changing Higher Education Landscape‟. One more of the many interesting lecture going on within our University. It was also a good opportunity to reflect about the governance structures within the University (specially the Student Union)

as well as about the meanings of being a student at CEU. Being a student is a status, a shared identity, but most of all an enjoyable and memorable experience. What makes this part of life unforgettable is of course all the fun one has with his/her friends, but also the fact that all things run up smoothly. And even when problems arise, there is always an institution to which you should be able to turn to. Or at least

that was Allan Pall‟s arguments when he mentioned the exis-tence of a driving force promoting and shielding the interests of the students – their union. Allan Päll, the chairman of the European Student Union which acts as an umbrella organization of 45 national student un-ions, gave a speech about their importance. He guided the

audience through the history of unionism and sketched the present challenges of a globalized world to which the stu-dent unions (SU) shall adequately respond. To keep a pace with turbulent changes, SU should be open, active in lobby-ing for students; they should be service oriented not only to-ward students, but also toward academic community and provide a forum for a social clustering of its members. Among other things, the lecture stressed the importance of

self-criticism within SU. As we are aware of how busy our fellow SU representatives are, The CEU Weekly decided to undertake the glorious bur-den of attending the lecture in order to provide them with a load of reflection that could nurture upcoming activities.

We start with the first point – openness. Well… At least we know the name of the members of the SU (This was e.g. not the case of Cambodians under Pol Pot regime, where even the mere existence of party not mentioning the names of party members was unknown to the public). We have al-ready said it two times, and we will keep iterating it again and again until the things change. Update your website! We are not interested in what your predecessors did; we want to

know what you are doing! Second, the fact that you should be service oriented does not mean that we expect members of the SU to provide a cater-ing. Yet the nature of your work remains a mystery. Maybe it is similar to the job of intelligence agencies. You are virtu-ally invisible, concealed to the eye of the public (and treach-

erous enemies) in order to uphold our well-being and safety.

We can only guess… Now we are reaching the third point – social clustering. For sure you did not ended up in the SU just to make your CV to look better which was mentioned by the lecturer as one of

the motivations of people joining SU. No, we are convinced that it was a zeal and devotion to the ideal which brought you to the SU. So keep this ethos up! Engage in the dialogue with professors, lead the dialogue with us! Organize cam-paigns, lobby for the common good and firmly stay your ground! You got our mandate, our trust, so be the real lead-ers who set the pace!

SU should not stay aside of the stream of current events. On

contrary, it should become a stream itself, channeling a wis-

dom and fervor thus bringing the headway to the whole soci-

ety. And we are aware, that you, our SU members are ca-

pable of such a progress. But, could we kindly ask you to

start off with little changes at CEU?

Student Unionism: E Pluribus Unum

The Weekly Spam Review

There has been reports about people stealing some stuff from fridges in Residence Center TV Lounges. So I present the Anti-

Theft Lunch Bags! They will make your food look moldy ! !

Transparency International (TI) released its first National In-

tegrity Study of Hungary since 2007, and it is not looking

good… In summary, TI con-

cluded that the system of

checks and balances in Hun-

gary had weakened signifi-

cantly during the past years.

Furthermore, the control institu-

tions are unable to limit the

power of the government, and

private interests prevail over

public interests. The study em-

phasizes the emerging role of

corruption, which partly origi-

nates from the symbiotic rela-

tionship between the political

and the business elite.

The National Integrity Study

examines 13 institutions and

sectors from the fields of poli-

tics, culture, society and econ-

omy, evaluating their per-

formance and corruption risks.

The sectors receiving the worst

scores were those of anti-

corruption agencies, political

parties, business and the me-

dia, and there is a highlighted

concern about the lack of

transparency in the legislative

process.

TI gives a wide variety of rec-

ommendat ions regarding

every examined sector. For

example in the case of the me-

dia, they recommend that the National Media and Infocom-

munications Authority “should provide more detailed infor-

mation about its operations and should cooperate with the

stakeholders”, and that “the financing of the public media

and advertising from public money should be more transpar-

ent”. Although it might seem like these recommendations are

rather broad and general, surely no one can argue that fol-

lowing them would hurt the country.

The full report, the executive summary, and some colorful,

interactive and animated infographics can all be viewed or

downloaded from the website of Transparency International

at http://www.transparency.hu/NIS_2011_english.

Page 4

the the CEU Weekly

March 14, 2012, Year 2, Issue 15

HUNGARY NEWS

Transparency International: Hungarian state captured by private interest groups

Page 5

the the CEU Weekly

March 14, 2012, Year 2, Issue 15

HUNGARY NEWS

The numper of students applying for higher education instui-tutes dropped by 22 % this year. A total of 109, 000 stu-dents have submitted their applications this year, 32 thou-sand less than in 2011. The last day of application was originally February 15th, but the government had decided

that the recent enactment of the new education law should go with an extension of the deadline by nine days, so that students can reconsider their choices. Some consider that the dramatic drop in the number of ap-plicants can be attributed directly to the education reform, scaring students away from universities. “Those who cannot afford to financially invest in higher education on a long-

term basis have refrained from submitting applications,” - said socialist education critic Ágnes Kunhalmi to Népsza-badság, a Hungarian daily. She referred to the sharply de-creasing amount of subsidized places in higher education from next year, an issue affecting social sciences, arts facul-

ties, economics and law departments most intensely (more details on the new hungarian education law can be found in issue 13, at http://issuu.com/ceuweekly ).

Others blame demographic

trends, the increase of the mini-

mum score in order to apply, the

theory that more people choose

to study abroad or that because

of the changing legislative back-

ground students rather wait one

more year with their application.

Although all these factors can

explain a minor part of the phe-

nomenon, it would be unreasonable to think that it can be

attributed to such a sharp decrease.

Hungarians losing interest in higher education?

On March 7th, the The European Commission decided to con-tinue with accelerated infringement proceedings against Hungary on three issues found problematic. The three issues are the retirement age of judges, the independence of the data protection authority, and the independence of the Hun-

garian central bank. The next phase of the infringement pro-ceedings can still hardly be seen radical, as it consists of sending two “reasoned opinions” to Hungary on the first two issues. If Hungary does not convincingly assure the European Commission that the aforementioned laws are either in har-mony with EU norms, or a process of changing them had started, the third

phase will begin. This third phase, coming after the “reasoned opinions”, is taking the proceedings to the European Court of Jus-tice.

A statement of the Commission argues that “Hungary has failed to provide an objective justification for reducing the mandatory retirement age for judges, prosecutors and pub-lic notaries from 70 years to 62 years within a time span of only one year”. Some find it especially strange when the retirement age is steadily increased in other fields, and ar-gue that the reason behind the change of the retirement age is that the 273 judges who are forced into retirement di-

rectly because of the new law can be replaced with ones supported by the government.

The second reasoned opinion has to do with the data protec-tion authority, pointing out that Hungary has not provided any valid arguments as to why there are no interim meas-ures allowing the former Data Protection Commissioner to stay in office until the end of his term, which ends in 2014.

Another issue that had been addressed are the concerns about the restructuring of the Hungarian court system, that is being accused of undermining the independence of the judi-ciary. The most important particular concern has to do with the additional powers that were given to the president of the National Judicial Office. According to the new law, the president can designate a court in a given case and the transfer of judges without consent – a power considered to

be unreasonable by the European Commission.

The concerns on the central bank had already been ad-

dressed, as the cabined approved a set of amendments to

the law in order to make it

more in line with EU norms.

Crucial criticized points had

been changed, such as the

cancellation of the attempt of

merging the financial regula-

tory body with the National

Bank. The issue is far from

being resolved, though. Economic and Monetary Affairs

Commissioner Olli Rehn, while welcoming the proposed

changes, pointed out that further proof, “clear commitment

and evidence” is needed.

EU versus Hungary – the next step

he Weethe CEU Weekly

Page 6

March 14, 2012, Year 2, Issue 15

CEU NEWS

Follow us in Twitter and Facebook

@TheCEUWeekly

I‟m not one of the pessimists. Despite all, I still think there is much to celebrate in a day like this. I accept, there is still a long, really long way for gender equality, yet we should cherish the ones who devoted their life against sexism, patriarchal social scheme, discrimination in

employment and all other forms of oppression. The problem I am having with this day is differ-ent. It‟s about what people think of it nowadays. My discontent is with the lost political flavour of this day. If this day becomes nothing more than distributing flowers like it‟s Valentine‟s Day in the perceptions of „most‟ of the people, then I feel like I lost the 8th of March.

Congratulations! Transformation of the day from fighting for the rights of women labourers to distributing flowers to women in labour is done! Yet, I do not wish to confine this

day to its original purpose; it should be definitely more than that. The question is how? How to re-

store the political flavour of International Women‟s Day? How to emancipate the day from this patriarchal scheme, let alone emancipating people from it? I know activists, feminists and peo-ple who have devoted themselves to this cause strive hard for this, and we all have a long way awaiting us. Again and again, we find ourselves

fighting against the reproduction of the domination, and

can‟t reach the source of it most of the time, yet it‟s not the time to be a pessimist! Yusuf Yuksekdag

Political Science MA

Emancipation of International Women’s Day

EVENTS at CEU

Concert of the Classicus et Universus Ensemble Wednesday, at Nador 13 Lobby there will be a classi-

cal music concert. It will start at 7pm, and there will be selections from Mozart, Brahms and Smetana. Documentary: Torn

“Can you be a Catholic priest and an observant Jew at the same time?” This documen-tary, hosted by OSA, will be screened Wednesday at

6pm. Event will take place at OSA, Arany János u. 32.

POLEMO Reading Group Se-ries

This week the group will focus

on the ethics of abortion. The

reading group will take

place at 3.30pm on Wednes-

day (FT 708). Giubilini and

Minerva's "After birth abor-

tion" will be discussed.

Stand-up Express

If you like stand-up comedy, you will be happy to hear that Stand-up Express had introduced itself in the end of February 2011, and it is here to stay! The concept is

simple: a stage, an audience, drinks and three humorists from exciting international background. What could go wrong with such a setup? Apparently nothing, if we consider the success of the first event. That is the exact reason why the organizers Dumaszínház,

Skalar Music Hungary and British

Council decided to make it a regular thing. For the next event they invited the Hungarian Felmeri Peter, Vlatko Stampar from Croatia and John Robertson from Australia, who was recently named as one of ZOO Magazine’s Top Ten Young Aussie Comics. The event will be held at Godot

Kávéház (1075 Budapest, Madách u. 8.) at March 21st! Drop by for your ticket today!

Page 7

the CEU Weekly

March 14, 2012, Year 2, Issue 15

INTERVIEW

Transparency in Hungary: a talk with CEU’s specialist Agnes Batory

TCW: Agnes, please, could you share with us a synthesis of where does Hungary stands with regard to the Transparency agenda; what are the pressing issues in the Hungarian con-text?

Agnes: The Hungarian chapter of Transparency International (TI) has been busy ever since it started operating as a foun-dation in 2006, but perhaps never more so than now. Not only are the „usual‟ problems still around – chief among them the lack of transparency in party and campaign financing and a badly regulated public procurement system that is wide open to abuse – but there are also new issues that

make taking effective action against corruption difficult. Sev-eral of the independent institutions charged with tasks crucial to keeping public life clean have seen their mandates changed, or their independent operation put at risk by the partisan appointment of key officials. The recent changes in the judicial system and the new power of the chief judicial official, for instance, to transfer cases to different courts

opens the way to at least a perception of lack of objectivity, of using corruption for political witch hunts which obviously does not help the cause. TCW: is there an autonomous body that safeguards the right of citizens to access to information? Who defines what is public information and how accessible is it? What is the cost of accessing public information?

Agnes: Hungary was a pioneer in the region in adopting progressive legislation on FOI (as well as electronic-freedom of information) that provided wide-ranging rights to citizens for seeking information at no cost, and for enforcing these rights through the courts. Compliance with the act, however, has always been patchy, for instance better by central gov-

ernment than local governments, and better by some minis-tries than others. The constitutional guarantees of FOI in-cluded the office of ombudsman (parliamentary commis-sioner) for FOI and Data Protection – an institution that, while somewhat limited by its weak enforcement powers nonethe-less effectively aided the recognition of the right. In a con-troversial move, the current government abolished the office of ombudsman, and replaced it with an authority with

weaker guarantees of independence. This change is currently contested by the European Commission as well as a number of other international bodies. TCW: very interesting, thank you. And Agnes, tell us, how do you think CEU can better contribute to enhance transparency in the region and in itself? Any hints you could you provide to

practitioners on the anti-corruption agenda on where to be-gin?

Agnes: CEU does what an academic institution needs to do in this respect: it does research and (hopefully) educates generations of students to keep an open mind, be critical towards authority, and never hesitate to ask questions. I be-

lieve many former CEU students live by these principles not only in countries where this is easy or even goes without say-ing, but also countries where you take a personal risk by asking awkward questions. As for advice to practitioners, my answer is one you‟d probably expect from an academic: it depends. There is no general solution or silver bullet against corruption, only small steps tailored to context and local cir-cumstances.

TCW: And Agnes, you obtained your PhD in International Re-lations from Cambridge, could you please briefly mention or enumerate a couple of those aspects in which you find CEU and Cambridge to be similar and those in which you find them to be different.

Agnes: This is a difficult question. I genuinely believe that the quality of education CEU provides is very high, and most of our graduates look back at their time with us as a very rewarding experience. But a comparison with what is (at least by some rankings) probably the best university in Europe is somewhat unfair. Cambridge is a huge university located in a charming and rather small medieval city (in fact the city centre and the university feels one and the same),

with the colleges providing cozy intellectual homes for com-munities of students and scholars. With 800 years of history, tradition and wealth behind it, there is never any doubt about what the university stands for, or a sense that it would need to prove itself – it is others that need to measure up to its standard. I felt very privileged to spend a few years there while doing my doctorate. In contrast, as you know,

CEU is a small institution that stands somewhat island-like in a bustling capital city, and after 20 years it‟s still new enough to constantly reinvent itself. This and the incredible diversity of members of the university also make it a very exciting place to work at. TCW: Agnes, thank you so much for granting us this interview. It is really nice to learn from you. Are there any final words

or message that you would like to share with the CEU audi-ence? Agnes: I can‟t really think of anything to add…

TCW: Thank you Agnes, koszonom szepen! It was great talk-

ing with you!

Dear Agnes, thank you so much for accepting this interview. Agnes, you are chairman of the board of Transparency International Hungary, academic coordinator of the Erasmus Mundus Masters in Public Policy (involving other three

universities), and CEU is lucky enough to have you as associate professor teaching courses as Corruption and Corruption

Control and tutoring PhD students. We are of course very pleased for having the opportunity of talking with you.

he Weethe CEU Weekly

About the CEU Weekly

This is a student-alumni initiative that seeks to provide CEU with a regularly issued newspaper. The CEU Weekly is a vehicle of expression for

the diversity of perspectives and viewpoints that integrate CEU’s open society: free and respectful public debate is our aim. We offer a place in

which current events and student reflections can be voiced. Plurality, respect and freedom of speech are our guiding principles.

This is a paper for the CEU community, submissions for publication are not only welcomed, but encouraged. If you have something you would

like published in the CEU Weekly, please: Write us at [email protected]

March 14, 2012, Year 2, Issue 15

Page 8

ALUMNI PERSPECTIVE

Editors: Rodrigo Avila B. (Editor in Chief), Jonathan Day (Managing Editor) Editorial Council: Natalia Peral, Yusuf Yüksekdağ, Lucas Gilardone, Donald Mogeni, Moritz Poesch, Tamas Gyorgy, Erik Kotlarik and Catalin Stanescu

Malawi is embarrassingly poor. Almost 50 years after independence, we still cannot finance our own health, nutrition and education needs. That is why we need all the friends we can get. Having

more friends, seeking help, taking ad-vice and learning from them does not make us less sovereign. And no, it does not make our leaders less mortal either. The so called rapid economic growth that has occurred in the last 5 or so years seems to be getting to our heads, making us think we can survive on our

own. But obviously, that growth is only good for the economics text books. It is superficial. It means nothing to the ordi-nary Malawian. We cannot import fuel. We have no electricity two thirds of the time. Civil servants go 90 days without pay. Our social indicators are still ap-

palling. Indeed, amid the litany of economic achievements of the recent past, the country is still not able to pay for 40 percent of its annual budget. Our life-line comes from overseas donors who cover that ghastly hole in our budget. The bulk of that donor aid comes from

the British. Yes, the same British people that we are now spiting and kicking out, have historically and traditionally been the largest donor to our poor nation. The people of Britain send over £90 million a year to Malawi in bilateral aid. About 40 percent of this goes to

the health sector, keeping our nurses incentivised and preventing them from quitting due to poor working conditions. A further 25 percent keeps the educa-tion sector going, creating the much needed human capital accumulation that is needed for the county‟s develop-ment. The balance goes towards gov-

ernance, including anti-corruption and police reforms. We know that the British support may not be purely altruistic. Indeed, like all other donors, geopolitical interests may

be their major driving force. But coun-tries like Malawi, who are minnows in global politics (remember how we mis-erably failed to sell Taiwan in the UN?), need not worry about donor‟s hege-

monic intents. Aid is never value-free anyway. While other bilateral donors have re-coiled, and even closed shop, at the slightest misuse of their aid, Britain has been very tolerant and patient with us. We abused their tax money to buy 39 Mercedes limousines in 2000. They sim-

ply cautioned us. We again wasted their £9 million on a luxury jet for the president. They again simply repri-manded us reasonably. It is therefore unimaginable that we could throw out the British simply because they have raised a concern, like every sane per-

son would wish to do right now, that the president is “becoming ever more auto-cratic and intolerant of criticism.” Our leaders seem to be overly, and dangerously, obsessed with our new courtship with China. We need to recall that Zimbabwe had the same unfortu-nate obsession. China never saved Zim-

babwe. China never replaced Zim-babwe‟s bona-fide donors. Apart from Mugabe‟s 25-bedroom mansion and the imposing ZANU-PF head office in Ha-rare, what is there to show for Zim-babwe‟s romance with China? Nothing!

I am not suggesting that Malawi aban-

dons China, or that the ties are ill-conceived. This is only a caution not to be too carried away by the personal benefits that our political elite may be cultivating from the relationship with China. It is well observed that while most of our traditional donors have

been supporting the social sector in ar-eas such as water, health, agricultural subsidy and education, China has ven-tured into patronage seeking invest-

ments such as a university on the presi-dent‟s farm, hotels, parliament buildings and stadiums. The Chinese approach is obviously not pro-poor. It is arguably elitist. It bene-

fits the political elite in Malawi and the business elite of China. The British, American, European and Canadian sup-port has been pro-poor. They are a better evil. We need to sustain those friendships for the sake of the poor. Arrogance and impunity will only satisfy our leader‟s egos, but will derail our

resolve for progress. We need to understand that taxpayers from donor countries are not keen on subsidising economic and political mis-management. Their representatives in Malawi therefore have every right to point out where things are going wrong,

without fear of being labelled persona non grata or being bullied out of the country. Mr. William Hague, the British Foreign Secretary, is right: “It is a worrying sign that the Malawian government is ex-pending its energies in this way, rather than focusing on the real and substan-

tial challenges facing it, including the need for improved governance.”

Daniel Msonda

MALAWI Mundus

MAPP-DPP Alum-

nus 2010

*The article appeared in The Daily Times, The

Nation on Sunday and The Nation Newspa-

pers in May 2011

Malawi needs genuine friends