The Ripple Effect – Revolution in Egypt

Cardiff Business News

As protesters erupt on the streets of Cairo for the seventh day in a row, political pressure is mounting on Egyptian President Hosni Mubarak to step down after a 30 year autocratic rule.

Photo by Muhammad

While the geopolitical implications for the region are monumental (as Egypt is supported with American aid in part for its favourable relationship with Israel which could change under a new government) the dual force of inspiration from events in Tunisia and economic woe has pushed the north African country to the brink of revolution.

Live twitter feeds and video have made events exciting to watch unfold on the TV or on the laptop, listening to updates from BBC correspondent Jeremy Bowen or Channel four’s John Snow. But behind all the pictures fed through by the media much is at stake.

Dividends have failed to filter down to the Egyptian people despite the country experiencing GDP growth of over 5 per cent in 2010, meanwhile high inflation (around 12.8 per cent) and rising unemployment have caused discontent with the those in and out of work.

And now, tens of thousands of Egyptians are standing up to say they have had enough of the same.

Things may just be about to change – and Egyptians hope it will be for the better, with greater economic prosperity and greater democracy to improve their lives.

But there is one other issue I would like to investigate: do the events in Egypt affect us in the UK or indeed in Wales?

When I visited Cairo in the summer of 2010, our tour guides were predicting an uprising against Mubarak as we passed through what seemed a chaotic city centre with growing unemployment, a place where 20 per cent of the population live below the poverty line.

Of course the tourism industry will take a hit, with over 20,000 British citizens stranded in the country while others holidaymakers and business travellers have been advised by the FCO to avoid making the trip except in urgent circumstances.

Tourists have been advised against travelling to Egypt

The BBC made this clear earlier today. Meanwhile the Financial Times reported yesterday that businesses have started to evacuate staff. Investors look on nervously as shares fell in Cairo by 16% in two days last week.

Similarly, the political unrest in Egypt, which has moderate oil reserves yet its Suez canal acts as an important thoroughfare for oil and gas, have also pushed up the price of it to over $100 a barrel, which will inevitably push fuel prices up in the UK if they are sustained at this high level for any great length of time.

In fact, David Cameron on today’s BBC breakfast show hinted he could introduce a “fuel stabiliser” to help reduce prices for fuel motorists have to pay when asked about the effects of events in Egypt on fuel prices.

So while I watch updates stream through on Twitter, events unfolding in Egypt have reminded me of the importance of economic policy and geopolitics, and their impact on the lives of everyday people on the ground.

Whatever unfolds in the next few days will not only make history of or for President Mubarak, but it will send ripples through neighbouring north-African countries into OPEC, international trade, UK motorists and most importantly, the lives of everyday Egyptians.

What is Entrepreneurship?

Phil's Journey through Journalism

By the time he was 11, a London boy named Alan Sugar started his career selling rags to a scrap merchant. Although the merchant swindled the young Mr Sugar by handing him half a crown for what turned out to be wool, rather than £1.10, he was beginning to develop something known as the ‘entrepreneurial spirit’.

The Apprentice
Can anyone replicate his success?

By the age of 15 he bought a camera and started selling pictures of children in his neighbourhood to parents and grandparents, making some extra cash on the side while studying. But to the horror of his parents he left school early to work in a factory. His story is one of rags to riches, from the back streets of Croydon to heart of London, Southbank. Today he is arguably the most iconic self-made man in the UK.

But with so much media talk of entrepreneurship – a clear ideology of the coalition government – as the “Big Society” begins a process of decentralisation and looks to create space for new business start-ups to take the flack of the recession, it has made me question, what does it mean to be “entrepreneurial”? And is it the way forward?

Just two days ago at the Cardiff business club, another celebrity entrepreneur and politican Lord Heseltine spoke of his journey to success in his early days after graduation from Oxford. Of course he faced uncertainty. He had to start out somewhere, eventually becoming one of the most successful publishing moguls of our time. Lord Heseltine said he started out with £1000 in his pocket and began his entrepreneurial journey by renting a 9 bedroom flat with a friend and letting it out for a small profit. The pair then moved their business into a hotel. A snowball effect culminating in the genesis of Haymarket with a friend from university.

What can we learn about entrepreneurship from these two men? The lesson I took was to make the most of a little. There were many times when projects failed. Heseltine’s magazines, <emMan about town and Topic were a flop and Lord Sugar nearly lost his fortune with the demise of Amstrad. But persistence, resilience and some luck managed to pull them through.

The Oxford dictionary defines entrepreneurship as characterized by the taking of financial risks in the hope of profit. But is entrepreneurship solely about taking risks and making profit? Perhaps it is about having a sense of commercial awareness, resourcefulness, energy, creativity and an understanding of one’s strengths and weaknesses. So when a spot of luck comes your way, you are ready to make the most of it. And perhaps the best outcome is to benefit society with the by-product of some profit.

Perhaps part of his success is down to the fact that he is not afraid to be himself. What you see is what you get.

2010: The death of the Tiger?

Cardiff Business News

AS Ireland laments the death of its Celtic Tiger the Chinese are preparing to see out the year of tiger to ring in the new year of the rabbit. It seems 2010 has brought the death of the tiger, making it an endangered species in the West.

The death of the Celtic Tiger in 2010

This year finance ministers in the Eurozone have struggled to keep inflation low, ensure banks are furnished with credit and balance the demands of taxpayers against investors. With all the talk of cuts and austerity, what has got us in this mess, and what does 2011 hold for Western Economies?

European Bailouts
The Eurozone has had a rocky time. In May the IMF and the European Union announced a support package for Greece to the tune of 120bn euro. In November the same pair had to come to the rescue in Ireland with an 85bn euro package, despite the country’s initial denial that it needed any help. Fears of contagion in the Eurozone have not yet been quashed as some investors anticipate bailout deals for the Iberian peninsula.

European Day Of Action: Protests In Dublin - September 29th.
The Irish banks will get around 11bn euro from the European Financial Stability Mechanism (EFSM)

For much of the developed western world it has been a year of austerity with spending cuts, tax hikes, bank bailouts, quantitative easing and emergency summits. The UK’s coalition government announced its comprehensive spending review in October, passing the buck (certainly not literally) to regional governments. Next year VAT, a consumption tax, will rise to 20% while spending cuts in the public sector will mean around 330,000 public sector workers will lose their jobs.

Go East
“Go East young man” has been the motto of the middle class with increasing numbers of investors and students looking for better job prospects and growth in Asia. Meanwhile the Euro crisis has prompted a move by the Chinese government to pour capital into the west by buying European bonds to ensure European financial stability.

The Welsh View
As for Wales – The Ryder Cup may have brought much international attention in 2010, but in terms of the economy, Wales has received very little good news of late. The office for national statistics released data last month revealing Wales as the poorest nation in the UK. And with an workforce heavily reliant on the public sector, a drive in the private sector may be hampered by poor technological infrastructure.

Reasons to be cheerful
While there has been much doom and gloom in the past year there are still some reasons to be positive for 2011. Wales is set to cash in on London 2012 as it will host 14 football matches and be used as a training base before the games by some international teams. It has never been easier to start a business, with a boom in online start-ups and the Cardiff Bay development has brought life to the Welsh capital. One indicator we will all be watching with anticipation is GDP, as the CBI has predicted 2% growth for the UK economy in 2011.

In Europe it is yet to be seen whether the ECB issues e-bonds or will increase the EFSM to stabilise markets.

Let’s just hope there is not a double dip recession, turning the year of the tiger to the year of the Bear.

‘Snow Joke – The Cost of Snow

Cardiff Business News

At primary school nothing excited us more than snow. Although the teacher wouldn’t let us out of class until the end of the day, we talked about it, thought about it and even planned our next hiding spot to pick off unsuspecting parents and classmates.

Snow brings Cardiff City Centre to a standstill

People are curious about snow. Who would have thought a frozen bit of water could cause so much intrigue. Some people poke their heads out of their doors just to see what is happening, others inspect the ground in their front garden and on top of their cars, while others still dig a clear path outside their driveway to minimise the risk of being sued.

Then there are those who are unable to resist the juvenile desire to form a rough sort of spherical shape and launch it at a wall, lamppost or passing pedestrian.

But today thousands of people across the UK are not so intrigued or enthusiastic about the big freeze. A White Christmas could put festivities “on ice” this year.

As flights have been cancelled right across the UK, it is important to know your rights and get the customer service you have paid for.

This scenario happened to me today. At the crack on dawn I dragged a heavy suitcase through the mushy streets of Cardiff in search of a taxi or any form of transport to get to the Airport. I checked all the updates at my departure and destination airports, both reassuring that flights were operating as per usual.

Eventually a taxi driver spotted me making deep tracks in the snow-laden pavement and took me to the airport. I wasn’t too bothered about the fare, a hefty £25, as I was sure my flight was due to board shortly. When I got to the desk, however, I was told the flight had just been cancelled.

My flight has been rescheduled for tomorrow, but I will lose out on airport transfers. Is the flight company liable to pay compensation? According to the Airport Users Traffic Council compensation is not handed out when flights are cancelled due to ‘extreme circumstances’, which includes bad weather.

Under the same act, the airline is required to refund me within seven days or offer a re-routing. But I will not qualify for compensation for hotel stays or transfer costs.

Aside from the cost of the snow to individuals, businesses will be hit as employees are stranded and shoppers postpone their big Christmas shop. It was estimated earlier this year the effects of snowy and icy conditions will cost businesses £1.2bn a day.

In the meantime as I am thinking of a plan ‘B’ – it could be a good time of year for ferry companies.

To see what areas have been affected visit the interactive UKsnow website.

paidContent:UK – Generating Online Revenue

Cardiff Media Blogs

When technology journalist Rafat Ali suddenly found himself out of work he had to find a way of making a living. Based in NYC in the late 90s Mr Ali covered the dot com boom with internet media company But when his employer went under in 2001 as the internet bubble burst he packed his backs, headed for London and became one man blogging machine. This is where the story of paidContent:UK, a website covering issues facing the media industry and the business of mobile content, all began.

Rafat Ali
From Blogs to Riches

From blog-to-riches Ali sold his site to the Guardian Media group for £4m in 2008: a great success for the blogger-entrepreneur. How did he do it? It was a time when blogging was beginning to grow as newspaper sales were declining sharply and the media business was left in the lurch. Mr Ali took a leap and landed on his feet.

One of the most important issues for any blog is the question of how to sustain its activities. Many news sites adopt a combination of ads and charging for access. Advertising has changed as much as the news industry, rushing to new media platforms such as social media sites, online TV and blogs. It would certainly help bloggers to understand how advertising companies operate or at least how they target audiences in a way that traditional ads in the paper can’t.

Former JOMEC student, Robert Andrews, at paidContent:UK said online advertising had less of a premium due to the volume of the web. How true. On a newspaper there are a limited number of pages where the audience will engage with the ad. Online, however, page space is unlimited.

Space may be limited but can the same be said for quality? If bloggers can create enough valuable and quality content then surely this will help to raise the capital of their online space, that is, capital measured by number of viewers.

But the real challenge to the blogging world is converting viewer attention into revenue. This is where the debate about paid content begins. Display banners are one of the traditional methods of online advertising but are they the future? Contextual adverts offer the ability to advertise on sites by buying near particular keywords. But tablets such as the ipad are changing this model.

The web, in fact, may only be a transitory stage before technology races ahead, where people will consume media on tablets, apps and mobile media. For news this may not be so bad a transition. Mr Andrews revealed people are willing to pay for apps, while this new platform looks more like the print product on new technology than it does on the web just like the New York Times Google Web app.

Is this the beginning of the end for the web?

Perhaps bloggers should be developing apps to stay ahead of the game.

Wales: The UK’s poorest nation

Cardiff Business News

It’s official. Wales is the UK’s poorest nation.

A headline posted on the Wales Online website may not have surprised many had it been published in the early 90s, given the economic decline from years of booming coal and metal industries. But decades have passed since then. Surely enough time has elapsed for this country start to develop new economic strategies and to lift itself out of poverty?

What can be done to free Wales from poverty?

Of course, poverty is relative. So what does being ‘poor’ actually mean? The claim made by Wales Online is based on data released by the Office for National Statistics, looking at Gross Value Added per head, a measure of average income. The data revealed the GVA for Wales was just 74.3% of the UK average.

This means that if I live in Wales I will probably be earning 74.3% of what I would be earning if I lived elsewhere in the UK. Not a great advertisement for the young, bright and ambitious.

Some would argue that the GVA does not take into account living costs, which may be true, but it still does not explain the fact that the GVA per head in Wales has dropped from 85% of the UK average GVA to the 74% it is at today. Meanwhile unemployment in the region is at 8.1% of the population compared to 7.7% in the UK.

On that definition Wales is slipping into poverty.

So what is being done about it?

The WAG published a 50 page document in July called d Economic Renewal: a new direction which identified six key sectors to the future of the Welsh economy.

– Energy and environment
– Advanced materials and manufacturing
– Creative industries
– Life sciences
– Financial and professional services

And earlier today, the WAG launched a strategy called Digital Wales. In a statement on the WAG website First Minister for Wales, Carywn Jones, outlined some of the problems facing Wales in the drive to get the country online.

– A third of the adult population in Wales does not use the internet;
– Less than 40% of Welsh SMEs actually sell on-line;
– One in six Welsh employers consider the IT skills of their employees insufficient;
– Less than a quarter of the population currently use online public services;
– High speed broadband is not yet available in many parts of Wales.

As far as I can see, in addition to the many infrastructural challenges to growth in the digital sector there is another significant obstacle to economic growth in Wales. The the job market is heavily reliant on the public sector, which will soon face cuts as austerity measures are implemented.

Now with the explosion of the internet it seems digital industries are more important than ever, but with poor infrastructure will these measures from the Welsh Assembly Government be too little too late?

How to go Hyperocal: business tools

Cardiff Media Blogs

Why would anyone do it?

There seems to be no money in it. It takes hard work, passion, blood sweat and tears while it involves hours of research.

Day 139

Yet hyperlocal is growing.

Hyperlocal bloggers need to have certain qualities to succeed, says Glyn Mottershead at Cardiff University. Bloggers need to be obsessive, independent, link lovers, passionate and willing to consider ways of monetising the hyperlocal blog. No-one has quite cracked it yet.

I must admit, going hyperlocal seems a bold call. With no proven revenue model it is difficult to think of many reasons to put so much investment into something that may not give any returns.

There are, however, some promising examples of hyperlocal models in action, providing an invaluable service to their communities.

Take the hyperlocal site Scottish TV

Or the Wales Online website

And Hannah Waldram’s Guardian hyperlocal blog

These blogs and news sites involve the community and readers like never before where guest comments and posts are welcomed.

But for a hyperlocal blog to truly succeed, as in the case of the Cardiff Guardian online blog it takes interaction not only virtual level but being physically present in the communities. Connecting people, informing and giving a voice to the community is the name of the game.

While this is true for news sites, it can be the same for entrepreneurial bloggers and businesses.

To build any business you need customers and to make a business out of writing you need an audience.

In the past businesses sought to attract customers from a local catchment area. The way businesses and newspapers go about interacting with a community is now changing.

Hyperlocal is more of an attitude than a place.

I read an inspiring example in Wales Online this Sunday of a Welsh young man who left the country and set up a bodybuilding site. He is now editor-in chief of the world’s largest health and fitness website.

Anyone with a bright idea and a real passion for sport, music, business, politics or people can base a website around the idea of hyperlocal.

Hyperlocal is, in this sense, a community. It could be sports fans, running enthusiasts or a business community. The real task is to create a useful product, engage and inform a community of people. With the rise of the internet, it has been easier than ever to set up an online business.

This can go a step further. One business has been built around a product, the next level of internet development is approaching frightening lengths to which a business can obtain personal information.

Programmes such as Facebook places, Groupon, foursquare and Gowalla encourage users to check in their preferences and geographical location. Just yesterday GAP announced it was giving away 10,000 pairs of jeans for free for the first people who checked into their store using Facebook Places. If I walk past the store and ‘check in’ with my iphone I can get a free pair of jeans.

There must be a catch?

As businesses are developing their use of RFID chips found in many mobile phones, which can track where people are at a given time.

Puce RFID photographiée en studio sur fond blanc.

These can allow users to interact with objects, building and companies in their area even suggesting news stories to people as they interact with an environment. Imagine you are on a bus passing a shopping centre. An iphone application could send you interactive information about what deals are on offer, helping you decide whether to get off the bus and grab a bargain.

This is the future of Hyperlocal.

Openly Local lists many of the hyperlocal sites in the UK on a google map.

Businessweek round-up: Ireland’s future, how the markets influence sheep thieves and Christmas shopping in Wales

Cardiff Business News

An uncomfortable week ahead for the Irish

It will be an uneasy week for Ireland as its Budget for 2011 will be announced on Tuesday. The Guardian has called for the Irish politicians to go back to the IMF to renegotiate its bailout package as the Irish taxpayer is expected to pay one out of every five pounds in interest on its debt. If it a renegotaition is not reached, writes the Guardian, a further bailout deal could lead to a ‘Treaty of Versailles’ scale legacy on the Irish Economy.

Irish Prime Minister (Taoiseach) Brian Cowen
A worried Brian Cowen, Ireland’s Prime Minister

Sheep Thieves influenced by market trends

It is very rare that the Financial Times makes me laugh, but this weekend’s edition induced a chuckle as I read the headline “Ram-raiders flock to rustle sheep as global trends shepherd in price rises.” It wasn’t so much the Sun-esque headline that grabbed my attention but the fact that farmers will have to be watching the markets to anticipate new trends in the activities of thieves. The FT’s North of England Correspondent, Andrew Bounds, explains: “The weak pound means many sheep are being exported, while traditional sellers such as New Zealand are struggling with drought and sending what lambs they do have to newly wealth Asia. This is helping push up prices at home.”

As prices are pushed up, stealing sheep becomes more profitable. The same happens when commodity prices such as steel rise. In such instances theives have stolen manhole covers.

Lying sheep
Sheep Raiding is at a 10 year high

A round up of the Welsh Business News

Christmas is on its way and many shoppers are holding off for a bargain in the early sales. But Director of St. Davids Mall, Steven Madaley, has warned retailers won’t be slashing prices before the official post-Christmas sales. The higher rate of VAT is to come in this January, encouraging pre-Christmas buying.

Don’t bank on pre-Christmas sales, warns centre director

The Welsh Assembly Government has announced a consultation session on the future of the banking system as the Independent Commission on Banking (ICB) comes to Wales next week. The ICB will be at the Pierhead in Cardiff Bay on December 8 to debate and hear evidence.

Have a say on banking system

Other Cardiff Related Business News:

Languages needed to boost exports

Biotech firm makes acquisition

Doubts over Cardiff Bay plan for sector aid to companies

More next week.

The BBC dosen’t tell the full story about China

Cardiff Business News

The Cardiff Business community heard how BBC coverage of UK trade with China does not show the full picture at a business event in Cardiff earlier tonight.

Over one hundred people attending the event organised by the Cardiff Confucius Institute heard from business leaders who are currently operating in with the world’s fastest growing economy.

Representatives from leading Welsh Businesses presented case studies and success stories of working China, dispelling claims in the UK media that a trade imbalance was desperately in favour of the world’s fastest growing economy, which saw its GDP increase by 8.7% last year.

Stewart Ferguson of CBBC, the China Britain Business Council, challenged reports from BBC’s business editor Robert Peston who said Chinese exports to the UK were three times the figure for imports.

In an article on the BBC website earlier this month Mr Peston said: “In 2009 we sold £8.7bn of tangibles and intangibles to China, and we bought three times as much, £25.8bn, from the Chinese,” he says.

“Although over 10 years our sales of goods and services to China have increased by a seemingly healthy 4.6 times, imports have risen by a far greater multiple, 6.6 times.”

Mr Ferguson said although this was true, there were other contributions to the UK economy from China such as £2bn per year coming from Chinese students in China.

He added there are 4,000 British enterprises in China, while UK based accountancy firms dominate the Chinese market and as over 150m Chinese residents are expected to flock to the cities over the next ten years demand could grow for UK goods and services.

Responsible Business: Interview with Business in the Community director Simon Harris

Cardiff Business News

Just two days ago the Office for Budget Responsibility (OBR) reviewed the figure of public sector job losses down from 490,000 announced by George Osborne in the CSR last month to 330,000. Despite this good news, both the public and private sector will suffer as a result of government spending cuts.

(Mr Harris at his office in Cardiff)

In these austere times as public sector contracts dry up and the banks refuse to lend, many business leaders will look to streamline their operations to save money and retain staff where possible.

Meanwhile globalisation has enabled companies to outsource to emerging markets like China or India and cut corners where possible to trim their budgets.

But as cutbacks are made, will responsible business practices suffer?

Sitting in his BiTC office boardroom, Mr Simon Harris, told me this is not necessarily the case.

When asked whether businesses were less likely to invest in responsible and sustainable business projects Mr Harris said:

“This is a particularly important time to focus on responsible business practice.”

“Our argument is that to separate yourself out as a business from the rest you need to look at how you are different from the rest.”

“In the retail sector consumers are becoming more aware of where their food comes from and purchase fair trade goods, for example.”

“So, if a business can promote a very positive responsible attitude then there is a possibility that consumers would be more likely go for those businesses than those that aren’t.”

“There is evidence that business leaders across the UK see responsible business practices as being key to their strategic development within the next few years.”

Mr Harris did, however, admit the CSR and public spending cuts could affect operations of the BiTC.

“With reference to the BiTC, as it does receive funds from the WAG, it will be difficult to renew some of the programmes we are running,” Harris said.

“In terms of the private sector if there is a continued or double dip recession it could be more difficult for them.”

Mr Harris said he was hopeful projects such as working in schools and exposing business leaders through projects such as “Seeing is Believing,” would help promote responsible business practices.

In as the recession continues it remains to be seen how business practices will react to tighter budgets and and a contraction in the public sector.

Applications open tomorrow for the BiTC flagship awards the Wales Recognition Awards 2011.

BiTC is a UK based business-led charity, which seeks to promote responsibility in the workplace, marketplace, community and the environment and it is a member of The Prince’s Charities. It’s headquarters are in London.