Ryanair CEO Michael O’Leary Protests Brexit in London with Funny Costume

Ryanair CEO Michael O'Leary Protests Brexit in London with Funny Costume

On Jun 23, 2016, the UK voted to leave the EU. The economic and political consequences will be significant and long lasting, and not just for the UK and the EU. The repercussions will be felt everywhere. The key concern for EasyJet and Ryanair, among a number of airlines hypothetically affected, is what will happen if the UK fails to remain part of Europe’s single market in air services when Brexit negotiations accomplish.

Ryanair CEO Michael O'Leary Protests Brexit in London with Funny Costume

A challenge for Ryanair is that its biggest base is in the UK, at London Stansted. Its two busiest UK routes in June this year are Dublin–Stansted and Dublin–London Gatwick.

Ryanair CEO Michael O'Leary Protests Brexit in London with Funny Costume

CEO Michael O’Leary was upfront, opinionated and amusing as ever today at a Bloomberg News conference where he warned that Brexit could lead to contagion. The CEO of one of Europe’s largest airlines said that he would leave that to greater minds than his—referring to his treasury administrators. He warned that the budget airline would be forced to rationalize investment if Britain votes to leave the EU.

Ryanair CEO Michael O'Leary Protests Brexit in London with Funny Costume

Appearing on a platform with British chancellor George Osborne at Stansted Airport, Mr O’Leary spoke that inward investment will be lost to participant EU member states such as Ireland and Germany if Britain votes for Brexit. O’Leary said,

It is this type of large-scale foreign inward investment that is helping to drive the UK economy and job creation. It is exactly this type of investment that will be lost to other competitor EU members if the UK votes to leave the European Union. The single market has enabled Ryanair to lead the low-fare air travel revolution in Europe, as we bring millions of British citizens to Europe each year, and welcome millions of European visitors to Britain, and we are calling on everyone to turn out in large numbers and vote remain.

Ryanair CEO Michael O'Leary Protests Brexit in London with Funny Costume

Brexit may result in Ryanair’s formation of UK subsidiary. Ryanair has reported it may create a new subsidiary to operate UK domestic flights if a “hard Brexit” happens, the company said. Under the worst outcome, the UK would be forced to leave the European open-skies system as it exits the EU, which would thwart Ryanair as a European carrier from remaining to operate routes from London to Belfast, Edinburgh and Glasgow.

Ryanair CEO Michael O'Leary Protests Brexit in London with Funny Costume

It would then need to establish a separate UK company, of which Ryanair would be able to own a maximum of 49.9 percent. If the UK continues part of the open-skies area, the company said it forecasts no change in the ownership structures of Ryanair or UK carriers. Ryanair said airlines have been invited to a round table discussion organized by the government department charged with navigating the UK’s exit from the EU to discuss the impact this will have on their sector.

Ryanair CEO Michael O'Leary Protests Brexit in London with Funny Costume

Ryanair has stepped up warnings that flights between the UK and Europe are jeopardized by Brexit, with the airline’s chief executive Michael O’Leary claiming that the prospect of upsetting aviation was one of the quickest and best ways for the EU27 to “stick it to the British”.

If Britain votes to leave it will be damaging for the UK economy and the European economy for the next two or three years … there’ll be huge uncertainty while Britain tries to negotiate an exit out of a single market and tries to replace that with a whole series of trade deals which they won’t get done … yet staying in is the way forward the British economy is performing fundamentally well at the moment … unemployment is low … the economy’s doing well … it’s one of the most competitive economies in Europe … this is the time to stay in and continue to benefit from European membership not leave now.

We speak as Britain’s largest airline we carry 40 million passengers to and from the UK this year we’re also a large foreign in word investor here in the UK I fly from 2060 British airports I employ more than three thousand pilots, cabin crew, and engineers and I want to keep investing in Britain I want to keep growing the business here in Britain but I can only do that if Britain remains a member of the European Union.

Were they not want to leave not just European Union but also the single market we may not be able to free to fly anymore between the UK and Europe as an Irish airline … now of course the UK is part of the European Union … it’s not part of the euro and the single currency … Ireland of course is there’s lots of criticisms about the future of the euro if it can survive in its current form overall has Ireland benefited from being a part of the single currency can the single currency survive as it is I think overall iron has benefits usually by being a member the single currency I think the single currency will survive because the strongest economy in Europe … Germany is behind the euro and I think they’ll do whatever needs to be done to make sure it does survive but there does need to be more harmonization between the outer relying countries the Greeks, the Italians, the Spanish, and the Irish who have suffered real economic problems in recent years as a result of very low interest rates and … you know property bubbles … but that’s why I a single market needs reform we’ve been very critical of Brussels and over-regulation and I think why this election will bring about more reform in Brussels as long as Britain votes to stay in.

Ryanair CEO Michael O'Leary Protests Brexit in London with Funny Costume

India Will Not and Must Not Become a Superpower

Indian historian and environmentalist Ramachandra Guha speaks of why India will not and must not become a superpower.

I broadly agree with Guha’s analysis about India’s last 60+ years since 1947, especially in the arena of inclusion/exclusion of communities in development process (e.g. tribals being mostly excluded), also the growing Maoism factor, and the polarization of religious communities who, unfortunately can have a foothold in mainstream politics with their religious agenda (e.g. Sangh Parivar via the BJP or the Muslim Parties such as the recently launched one by Akbaruddin Owaisi in Hyderabad).

But Guha is cautious not to completely belittle India’s progress in the last 7 decades and is in fact very hopeful of India’s future. This comes across in most of his writings.

India Flag As for Guha’s reasons why India should not become a superpower his talk mentions something to that effect. He is suspicious of superpowers because the 20th century’s experience with political/economic superpowers (Britain, USA, Russia mainly) is by and large not a good one when you see the record of colonial and post-colonial 20th century. Africa and all parts of Asia were left in tatters and the effects are still unfolding especially in the Middle East and South Asia (Indo-Pakistan conflict/ Hindu-Muslim communal rivalry).

However is it possible to define a superpower differently? Can India become a superpower of a different kind? There is no answer to this question since the model does not exist for the 21st century of such a superpower (EU is a close alternative but EU is historically unique and cannot be replicated). But the model being pursued by India since the last 20 years or a little more does not lend itself to an interpretation that India, even if it became a superpower, will be different from China or USA. And hence my opinion would be in agreement with Guha that India is better off not being a superpower but taking care of its internal issues as best as possible. This does not mean that we cannot unleash Indian potential. The day we unleash Indian potential by and for Indians will actually be the day India might actually claim “superpower” status. (There you go! a new understanding of what it means to be a superpower!)

The Economic Impact of Aging Japan

The Economic Impact of Aging Japan

The saving rates in Japan will fall dramatically by 2024 and make Japan’s financial wealth decline. There are two direct reasons for this fall: one is that by 2024, more than a third of Japan’s population will be over the age of 65, which will lead the retired household to outnumber households in their prime saving years. Another reason is that the younger generation is saving far less than older generations have, and this truth will amplify the effects of a decline in the number of savers.

This trend will decrease the accumulation of wealth and erode Japanese living standards. What’s more, since Japan has played an important role in financing the massive US current-account deficit, as Japanese funding dries up, this damage may extend to other countries and bring negative impact for economic system of America. For example, if other rapidly industrializing countries could not step up to fill the gap in savings as Japan’s savings rate declines, the United States will probably be forced to trim its trade deficit and this could have enormous repercussion for the global economy.

There are only two ways to mitigate the coming demographic pressure in a meaningful way: increasing household savings and boosting the returns earned on them.

  • Increasing savings: Given the significant increase in average life spans during the past 50 years, rising the retirement age is a way to extent the period when households are most prone to save. In addition, encouraging younger Japanese households to save more is also a helpful step to increase household savings.
  • Raise the rates of return: The most effective change for Japan would be to raise the rates of return on its financial assets. To do so, Japan will have to raise productivity throughout the economy and increase the efficiency of the financial system in allocating capital.

On one hand, basic structural reform, such as elimination of market regulations that would increase competition and spark innovation, tax policies protecting inefficient companies, and ease zoning and land regulations that reduce large companies’ expanding and creating jobs to protect start-ups to do business, could increase the economic-wide productivity.

On the other hand, increasing the financial system’s efficiency ensures the savings are channeled to the most productive investments and improves legal protection for investors and creditors. The diversification of Japan’s household financial assets is also an important means of increasing the efficiency of capital allocation.

Chinese Car Company Logos That Look Appallingly Familiar

The car industry in China is the largest in the world, as measured by total annual automobile unit production volumes. Since year 2009, the number of automobiles manufactured in China has exceeded that of the European Union and that of the United States and Japan combined.

45% percent of cars produced were BYD, Lifan, Chang’an (Chana), Geely, Chery, Hafei, Jianghuai (JAC), Great Wall and Roewe. The rest were produced by joint ventures of international automotive giants Volkswagen, General Motors, Hyundai, Nissan, Honda, Toyota, Mitsubishi etc. Further, that China car market is expected to grow tenfold through 2030.

Several Chinese car makers have been accused of copying designs of other companies. In addition, to increase sales and build up brand equities, Chinese automakers have rapidly expanded the number of brands they offer and some Chinese automakers have even taken inspiration from internationally-well-known brands. Here are side-by-side comparisons of brand identities—international brands in the left column and the Chinese derivatives in the right column.

Logos of the Acura and Changan Brands

Acura and Changan » Chinese Car Company Logos That Look Appallingly Familiar

Chang’an Automobile Group, based in Chongqing, has quickly grown to become one of the top four Chinese automakers along with Dongfeng, FAW Group, and Shanghai Automotive. It also has joint ventures with Ford, Suzuki, and PSA Peugeot Citroen.

Logos of the Cardillac and Emgrand Brands

Cardillac and Emgrand » Chinese Car Company Logos That Look Appallingly Familiar

Emgrand (literally the “Imperial brand”) is an automobile marque owned by the Chinese automaker Geely. Englon and Gleagle are the other marques owned by Geely, as part of Geely’s strategy of expanding its number of brands to encourage sales and evade a reputation for unreliability and poor quality.

Logos of the Mazda and Haima Brands

Mazda and Haima » Chinese Car Company Logos That Look Appallingly Familiar

Haima is a marque of the FAW Haima Automobile Company based in Hainan. Haima was a joint venture between the government of Hainan and Japanese car manufacturer Mazda. In 2006 FAW Group acquired Mazda’s stake in the joint venture and continues to use Mazda’s technology and an identical branding.

Logos of the Bentley and Riich Brands

Bentley and Riich » Chinese Car Company Logos That Look Appallingly Familiar

Riich is an upscale sub-brand of Chinese automaker Chery. Riich models include microvans, large sedans, a hatchback, a small sedan and a five door wagon. Riich’s logo mimics that of Bentley Motors, the renowned British manufacturer of luxury automobiles, now part of the Volkswagen group.

Logos of the Toyota and Xia Li Brands

Toyota and Xiali » Chinese Car Company Logos That Look Appallingly Familiar

Xia Li vehicles are the Daihatsu Charade and manufactured by FAW Tianjin. FAW group also has a joint venture with between Toyota called the FAW Toyota Motor Co Ltd.

Logos of the Alfa Romeo and Englon Brands

Alfa Romeo and Englon » Chinese Car Company Logos That Look Appallingly Familiar

Englon is also a marque of the Zhejiang Geely Holding Group, which owns manufacturing facilities in Lanzhou (Gansu province,) Xiangtan (Hunan province,) Jinan (Shandong province,) Linhai (Luqiao province,) and Ningbo in (Zhejiang province), and international plants in Indonesia, Sri Lanka, Malaysia, Russia, and Turkey.

Copies

In China, rip-offs of all sorts are common. Yet copying and plagiarism, from paintings to literary work to academic research papers, has a long tradition in China. Traditionally, it is considered a way of learning, and of indicating admiration. Recently there were reports of Chinese building replicas of architecturally significant towns and city sections from around the world.

Postscript

Geely (formally called the Zhejiang Geely Holding Group Co., Ltd) is the Chinese passenger car conglomerate that sells cars under five brand names, viz., Emgrand, Englon, Geely, Gleagle, and Volvo. Geely also owns Volvo Cars: Geely purchased Volvo Cars from the Premier Automotive Group of Ford Motor Company in 2010. Geely is headquartered in the Binjiang District of Hangzhou city.

Japan’s Demographic Problems

Japan's Serious Demographic Problems

Japan fell from grace after its booming 1980s, largely due to bureaucratic overindulgences, political slip-ups and unsustainable growth rates that fueled its prosperity for decades.

Japan is undergoing a slow but certain social, economic, and political transformation. The Japanese are reinventing their society with a growing sense of urgency.

Over the last fifteen years, Japan has experienced a steady decrease in the number of people in the working age of 15 to 64. Experts estimate that by 2050, this working population may shrink to just 54 million from a high of as much as 87 million.

Simultaneously, Japan’s population is rapidly aging. A 2007 report by Japan’s government stated that Japan’s population dropped for the first time since the first census records from early 1900s. Overall, Japan’s population of 129 million is expected to decline to 100 million by 2050. An estimated 30% of Japanese are older than age 65 leaving a smaller workforce to sustain the ever-increasing needs of the country’s national pension system.

Compounding these problems is the fact that Japan has the lowest birthrate among developed countries — 1.34 children per woman. Fewer women get married and have children. In addition, employed women work long hours leaving little time to devote to childcare.

The Japanese government announced an elaborate plan to stimulate the birthrate, provide for better day care in hopes that it would increase the number of women in the Japanese workforce, and ultimately boost economic growth.