Economist 5/5/15

  1. THE National Health Service ranks as the main concern among potential voters according to our April 2015 “issues” poll. Some 47% mention it as one of the most important to the election, the highest in the poll since April 2006. This will please the Labour Party, which has campaigned hard on health. Mentions of the economy—a primary focus of the Conservative campaign—are, on 38%, tied with those of immigration, the issue at the forefront of UKIP’s manifesto.Looking at a larger sample, with voters listing several topics, immigration draws level with health as a major anxiety. But when asked to single out the most important issue, a quarter of respondents chose immigration, compared with around a sixth for the economy and slightly less still for the NHS. And perhaps more importantly, immigration is the primary concern for the older age-groups.
  2. UNLIKE so many countries these days, New Zealand is blessed with an abundance of freshwater. Its temperate climate, regular rainfall over much of the country, 3,800 lakes a hectare each or larger and 180,000 kilometres of rivers ensure a good supply. But who owns all this plenty? The government’s view is that no one owns it: not the state, nor any group or individual.Maori claim a special relationship with New Zealand’s freshwater supply.Today the Maori’s claims have backing, as reflected in an interim ruling on freshwater by the Waitangi tribunal, a body set up in 1975 to address Maori grievances about land and related issues.The dairy industry, which is freshwater-intensive, has meanwhile become the country’s biggest export earner by far. It brought in $10 billion in the year to February 2015, according to a provisional estimate; the next highest exports were of meat and offal, for $4.6 billion. Most of that milk for export is converted to powder and then shipped to China, now New Zealand’s second-largest market.Dairy farming is also polluting freshwater supplies, as phosphates and nitrates seep into the groundwater catchments. This has become a political issue throughout the country.
  3. As Mr Abdel-Fattah al Sisi has kept Egypt from descending into mayhem, he has unremittingly repressed critics.Several thousand dissidents, both secular and Islamist, have been jailed; at least a thousand were killed.The Muslim Brotherhood of Mr Morsi has borne the brunt of the crackdown. Mr Sisi, the power behind the coup, has stripped the Islamist group of power and crushed it, labelling it a terrorist organisation. Hundreds of its supporters have been killed by state-security forces during protests.Mr Morsi got off relatively lightly on April 21st when he received a 20-year sentence.Several papers, both private- and state-owned, have recently criticised abuses by the police and the interior ministry. The ministry has responded with arrests and intimidation. Foreign reporters have been targeted, too.A terrorism law decreed in December could ensnare more activists: those who seek to “harm the national interest”, “compromise national unity” or “breach security or public peace” face life in prison if they are financed by foreigners.
  4. A BATTLE over voting rights, pitting the state against company boards and many investors, is raging among French companies. The biggest fight of all involves Renault, a carmaker with global ambitions. According to the so-called Florange law adopted in 2014, after March 2016 listed French firms must begin granting double voting rights to investors who have held registered shares for at least two yearsunless two-thirds of shareholders have voted against this rule. The provision aims to counter “short-termism” by encouraging more loyalty between investors and companies. It will also, fortuitously, allow a government intent on selling down some of its stakes in domestic companies to retain its influence over them while banking the cash.Vinci, a construction firm, L’Oréal, a cosmetics giant, and Unibail Rodamco, a property firm, shareholders have seen off the introduction of double voting rights. BNP Paribas and Crédit Agricole, both banks, are likely to do the same in May.
  5. After a big rally during the financial crisis, the price of Gold has sagged to about $1,200 an ounce, a third below its peak in 2011. The biggest pressure on the gold price comes from the expectation that interest rates in America will rise later this year. Matthew Turner of Macquarie, a bank, says that low interest rates cut the opportunity cost of owning gold. Higher interest rates, by contrast, raise the cost of holding non-interest-bearing assets. Gold is priced in dollars, so the fact that it stayed stable while America’s currency was rising (making gold more expensive for buyers in foreign currencies) is cause for cheer.One reason may be that investors have so many more options nowadays. Humble citizens who distrust their own currencies can buy assets ranging from shares to bitcoins.The main exception to the trend is Russia, where the central bank has been a notable buyer of gold, tripling its holdings since 2005. It bought 30 tonnes in March alone, bringing its hoard to 1,238 tonnes.

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