A few years ago when there was military coup in Thailand I called an uncle of mine who has business interests in the country. I asked him if he was worried that all the years of investment and relocation (from Spain – too much bureaucracy in Spain) would all go up in smoke – a factoory, huge amounts of stock and employees. His reply was very matter-of-fact. It all boiled down to a business risk. He had chosen Thailand for the well-priced labour, for the good prices on goods and for the markets that would be available from there (including the Middle East). The political turmoil was one of the cons in the equation but it had to be factored in – he had to hold his chin up and bear the brunt of any effects on his risk investment.
Chapter 2 – The “Save Our Business” Brigade
An article in today’s Times describes a Maltese businessman’s views of Libya: “Libya has proven to be fertile ground for Maltese business interests and some had plans for “massive” expansions. But the scenario seems to have changed overnight and they now question whether they would materialise.” The article was less crass than Tony Zarb over at GWU (see the Runs’ apt interpretation on that one) but whether it is workers or entrepreneurs you still get the impression that these people had absolutely no idea of the risk factor entered into when living, working or investing in a country run by a mad dictator.
Fashion outlets in Tripoli or Benghazi? Sweet. Did the immigrants held back by Ghaddafi as ransom to EU pockets stop over at the Libyan equivalent of Zara or Benetton to buy a piece of clothing or two for their nieces? One entrepreneur complained of furniture stock stuck in the UK and costing him 3,000€ every fifteen days. I remembered Antonio from the Merchant of Venice worrying about his lost merchandise at sea… business risks, business risks. History is full of entrepreneurs who had to factor in the risks of dealing with volatile nations. The Venetian Republic combined business and policy (and a bit of conniving thievery) to great effect for many a year. This business risk however carried the moral weight of investing and encouraging the growth of a dictator’s home patch. So long as he showed us the money we were not worried about storage were we?
What does baffle me is how bloggers and article writers can suddenly yell out in favour of our “business interests”. The same bloggers who would unthinkingly slap a Fair Trade logo on their blog or denounce sweat shops in India or China do not seem to be able to make the same equation for a similar reality closer to home. Well, I guess Nike, Apple and Sony don’t have the same familiar faces as hotel chains full of juicy restaurants, enticing spas and luxurious bedrooms.
Would you work in Afghanistan? Do you wonder why jobs in certain hot spots are much better paid? Do you know why an oil rig job is so well paid by the hour? The risk factor has a lot to do with it. Then when it comes to morals… the price is never high enough. Dealing with Ghaddafi means joining him in his quest to have the funds to pay mercenaries to shoot to kill.
On a state level it may be a Macchiavellian choice that is slave to the realpolitik of the day (like buying oil or submitting to the Italian request to pass on arms through your space). On a business level it is the equivalent of the golden goose… you never know when it is going to croak its last breath do you?
Again, forgive us if we are not weeping “our” business’ losses.
More on Entrepreneurs & Libya (pre-revolution)
