Magic Statistics

The new US envoy to Sudan, Andrew Natsios, has been given an impossible task—getting peace negotiations re-started among the combatants in Darfur.  Because the Khartoum government knows that world nations will not act no matter what further atrocities it commits, his mission appears lost before he begins.

[President George W] Bush, who has labelled as "genocide" the killings and rapes of hundreds of thousands of people in Darfur over the past three years, is lost, along with the rest of the world community, for an answer to the tragedy short of a full scale international military invasion.
. . .
[T]he challenges facing Natsios - a former administrator for the US Agency for International Development who has also served as special humanitarian coordinator for Sudan - are plentiful.

Sudan’s Arab-dominated Islamist government refuses to allow a United Nations force to operate in Darfur, a semi-desert region the size of France, citing a loss of sovereignty and fears that Sudan, once ruled by the British, will be "recolonised".

However, a bigger fear almost certainly lurks in the minds of President Omar al-Bashir, his ministers and generals. Luis Moreno-Ocampo, the Argentinian chief prosecutor of the International Criminal Court in The Hague, launched investigations in June 2005 into the possibility that crimes against humanity have occurred in Darfur, where 400,000 have died and three million have fled their homes since fighting began in February 2003.

Fear that United Nations peacekeepers might attempt to enforce ICC charges gives the Sudanese government a powerful incentive to forbid entry of a UN force.

The UN and many individual Western nations have been threatening Sudan for three years and done nothing more than implement ineffective economic sanctions.  The Sudanese government therefore believes it can do whatever it wants in Darfur with no significant international consequences.

Previous related posts:

• Khartoum booms while much of Sudan suffers
• No peace in Darfur
• Anarchy descends on Darfur

Last week Qiu Xiaohua, head of China’s National Statistics Bureau, was replaced without warning after only seven months in the position.  At the time, no reason was given, but it has now been officially announced that he is under investigation in connection with the pension fund scandal that brought down Shanghai’s Communist Party boss last month.

In the first official explanation for Qiu's sudden sacking a week ago, NBS spokesman Li Xiaochao yesterday told a news briefing that the 48-year-old former bureau chief was being investigated.

An investigation into the Shanghai social security fund scandal found that Qiu was "suspected of severely violating disciplines," Li said.

This having occurred in China, one cannot be sure whether that's the real story or he was sacked for irritating the wrong people.  Last week, some Chinese economists attributed Dr Qiu’s abrupt removal to his outspoken criticism of economic policies.

Qiu is well-known for his candid and unconventional views which sometimes contradict mainstream government policies, economists said.

He had also often expressed his views on the country's macro-economic or monetary policies, including those outside the scope of his job.

'Qiu Xiaohua has some problems and one of the major ones is that he often oversteped [sic] his role as the chief of National Bureau of Statistics,' said Yi Xianrong, an economist at the Chinese Academy of Social Science.

Hu Xingdou, economic professor at the Beijing Institute of Technology, said his outspoken stance had caused problems within China's bureaucracy.

'Qiu is quite outspoken and willing to express his views on national mainstream policies and macro-economic policies… so he has drawn some criticism,' he said.

Or maybe he was canned for refusing to manipulate economic statistics to suit party bosses.

In any case, as you can see, statistics can be a dangerous business.

Check out the headline over The Times of London report:

Statistics boss sacked for graft

Maybe it’s just me, but I found the term “statistics boss” hilarious.

As a result of Belgium’s recent reductions in corporate tax rates, some companies will pay no taxes.  In fact, it will be possible for corporations operating in Belgium to receive tax refunds.

Officially, Belgium will cut corporate tax rates by 25 per cent. Depending on a company's actual return on equity, though, it could cut corporate taxes to zero — and beyond.

In a September "e-briefing," C. D. Howe Institute economists Jack Mintz and Duanjie Chen describe Belgium's effective corporate rate as the lowest in 80 countries examined in their 2006 survey of the global taxation of corporate capital: minus-4.4 per cent.

With this move, Belgium moves to the front in the European competition for lowest corporation tax rates.  Zero is now the rate to beat.

The competition is driven by the fact that capital can move freely from one EU country to another.  Some Dutch economists have calculated that a 1% reduction in corporate tax rates prompts a 3.3% increase in foreign investment.

A new accounting wrinkle introduced in Belgium’s corporate tax reform could result in negative taxes for some firms.

Belgium will now allow them [corporations] (effective for the 2006 tax year) to deduct from profits an amount of money equal to market-rate interest on all their Belgium-based assets. In doing so, it becomes the first country to adopt the novel tax device called "notional interest deduction."

Next month, Belgian government officials will visit Toronto and Montreal to explain the notional interest deduction concept to Canadian corporations.  Someone should invite Canadian Finance Minister Jim Flaherty to attend.

See Neil Reynolds’s full column for details, with examples, of Belgium’s new corporate tax accounting regime.