Untitled Document Early morning

Untitled Document

Write a comment to K-Advisers blog entry

We are living in market economy. Are we? In theory, yes. In practice I wonder. There are couple of areas where the market economy doesn't work. One of them is agricultural. For example EU's budget for agricultural support is over 50 billion euros. Half of the EU budget. And still we are having rallys organised by farmers in Brussels. It also has created funny features and rules inside EU. It is forgotten now, but there was a rule inside EU that how curved cucumber may be! Today here in Finland if you are farming in the greenhouse and you want to be subsidized by EU you have to farm over the year. Think about what it means in this latitude. In worst times we are having in south around six hours, less than six hours where we are having big greenhouse farming areas. And the temperature. What a waste of energy. Interesting detail is that the Queen of England raises the biggest sum of the EU agricultural support.

Today the big discussion in Finland is the ship building industry. Especially STX Turku and how they lost big deal to STX in France. STX Turku asked capital loan (50MÄ) from the Finnish government. They didn't get it and they lost the deal to France. The deal stayed inside the same mother company. Of course shipbuilding docks are independent companies. What were the differences? French dock was in better position from the funding point of view. This business is very capital intensive business. Were there other tricks? Who knows. At least French government is a co-owner of the dock.

However, the fact is that the shipbuilding industry has been very subsidized industry for ages. Governments are thinking that it is a strategical industry due to the war history of the world, especially in Europe. Is it really today?

What if we would move to real market economy in agricultural and shipbuilding business? Would our world collapse?
Your name:
Your email:
Sum 1 + 3 =
Blog comment:

logo   ©K Advisers Oy 2022     tel:+358-44 064 4448     email: info(a)k-advisers.com     Last updated 27.6.2022