Portfolio Exclusive to Emirates First Class and Business Class
RECYCLING TAIWAN Money from Trash THE LOST GENERATION Europe’s Unemployed Youth CANADIAN OIL A New Delivery Model
Jérôme
Lambert Montblanc’s Global Stylist
Issue 97 ■ January 2014
FALL WINTER 2013
This issue JANUARY 2014
Portfolio
7
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Cover Story 26 Unity is Strength Jérôme Lambert, the recently appointed CEO of Montblanc, believes it is vital for the brand to retain a unified approach but yet be sensitive and adapt to the local norms of the countries it operates in.
Features 32 Nature Gives, Nature Takes
48 A Pencil Powerhouse
The Philippines has abundant geothermal energy, but
Faber-Castell, the world’s largest maker of wood-encased
Typhoon Haiyan destroyed the infrastructure.
pencils, is an example of how German midsize companies
36 Educated Yet Unemployed Youth unemployment has grown to staggering levels in many
stay competitive in the global marketplace.
52 Money in Trash
EU countries, dashing dreams and forcing many to leave
Taiwan used to have huge problems with trash, but now it
their countries.
recycles on an industrial scale.
40 Canadian Crude Hits the Rails
58 Germany’s Big Repair Bill
The delays and protests around the proposed Keystone XL
Europe’s largest economy is preaching austerity but its
pipeline has led Canadian oil producers to increase their rail-
aging infrastructure is in dire need of an annual €7.2 billion
loading capacity.
investment.
48
44 If the Shoe Fits The Chalhoub Group, founded in Damascus by Michel Chalhoub and his wife Widad in 1955, is a powerhouse in the luxury goods sector.
36
52
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Essentials 63 Art and Soul Zurich is often considered a staid city, but an exploration of its design and architecture reveals an anti-establishment attitude and quirky pleasures.
68 All Cheese Great and Small The picturesque towns and villages of the Yorkshire Dales are home to some incredible artisan cheesemakers.
63
74 Precision and Artistry The watchmaker A. Lange & Söhne is the phoenix of the luxury watch industry. The brand disappeared in the 1940s but is now revered again following its resurrection in the 1990s.
78 Fujifilm Finds a Niche The X series, which mimics old-style cameras but has a high-tech core, has helped keep Fujifilm in business.
74
82 The Quiet Force Bill Damaschke, the chief creative director of DreamWorks, is relatively unknown in Hollywood despite being behind numerous blockbusters.
84 Rock Star Ailsa Craig, a Scottish icon, is listed for sale as the only island that has ever won an Olympic Gold medal.
78
88 Other Business Portfolio takes a light-hearted look at the latest business news.
Departments
84
11 Notebook World business in a nutshell.
17 Observer Spotting and analysing business trends.
24 Column: Damian Carrington Deforestation On the Rise
Published for Emirates by
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Notebook
11
AFP/grAPheAst
BUSINESS NEWS IN BRIEF
Vietnam’s Electronic Attraction SamSung ElEctronicS built
Korea led with $3.66 billion.
the world’s largest smartphone business
China’s $8.4 trillion economy, 59 times
by tapping China’s cheap and abundant
the size of Vietnam’s, received $97 billion
workforce. Now it’s shifting output to
of foreign direct investment in the first 10
Vietnam to secure even lower wages and
months, six per cent up on a year earlier.
defend profit margins as growth in sales of
Intel, the world’s largest chipmaker,
Electronics’ global workforce, the largest source of labour outside South Korea, it said. Record economic growth that made China the second-biggest economy has fuelled wage inflation, pricing many workers
opened a $1 billion assembly and testing
out of low-end jobs. The base monthly
plant in Ho Chi Minh City in 2010. Nokia
salary for a factory worker in Beijing was
full production in 2015, China’s communist
said its facility near Hanoi producing Asha
$466, compared with $145 in Hanoi,
neighbour will be making more than 40
smartphones and feature handsets became
according to a 2012 survey of pay by the
per cent of the phones that generate the
fully operational in the third quarter
Japan External Trade Organization.
majority of Samsung’s operating profit.
2013. LG Electronics, Samsung’s smaller
The Suwon, South Korea-based company’s
South Korean rival, is building a new
double to 1.7 billion units by 2017 at the
second handset factory in Vietnam is due to
400,000 square metre complex to make
same time average prices will drop to $265
begin operations in February.
TVs and appliances as part of a $1.5 billion
from $337, according to industry analysis
investment plan.
firm IDC.
high-end handsets slows. By the time a new $2 billion plant reaches
Vietnam has been extremely successful in attracting foreign direct investment
After setting up in China in 1992,
Globally, smartphone sales will more than
While tax breaks and cheap workers are
(FDI). Vietnam’s government had approved
Samsung now has 13 manufacturing sites
lures that other countries such as India and
$13.8 billion of new foreign projects last
and seven research laboratories there,
Indonesia could offer, Vietnam’s location
year through November 20, a 73 per cent
according to its June sustainability report.
closer to existing Samsung production
increase on a year earlier, according to the
The 45,660 employees in China make
bases in China and South Korea is an extra
General Statistics Office in Hanoi. South
up more than 19 per cent of Samsung
incentive. n
January 2014
Notebook East africa railway
Numbers Game
20
per cent rise in vacant office space has hit
the Indian financial centres of Mumbai and Delhi in the third quarter of 2013, the highest in asia after Chengdu, China, where 32 per cent of offices are empty according to broker Cushman & Wakefield. India’s slowing economy has led to declining demand for office space, prompting builders to convert commercial projects into housing.
€1.71
billion record antitrust fine
has been levied on six european and Us banks and brokers by the european Union for rigging
$51
million boost to the emirate’s economy has come from the Dubai International Film Festival since it began in 2003, according to research from an independent international consultant. the $51 million includes tom Cruise’s hollywood blockbuster Mission Impossible: ghost protocol. the film alone raised an estimated $21 million for Dubai.
was hit with the single biggest penalty of €725.4 million, followed by societe generale
€391 million.
International anger over Us
across East Africa to reach
surveillance disclosures could
South Sudan, DR Congo and
In Figures
hurt Us sales because of
Burundi.
$2.7
doubts about the security of
The first section will link
information on their systems.
the Kenyan port of Mombasa to the capital, Nairobi,
billion fine will see starbucks making
good the damages and attorney
$1
million was the record
reducing the journey time
price paid for an
from 15 hours to about four.
electric guitar at a Christie’s
It is the country’s biggest
an independent arbitrator
auction that american musician
infrastructure project since
slapped the coffee maker with
Bob Dylan played at the 1965
independence 50 years ago.
the fine for defaulting on a deal
Newport Folk Festival. the
that Kraft, then controlled by
festival performance
be $5.2 billion and will mostly
Mondelez, made to distribute
cemented Dylan’s
be funded by China. All the
bagged starbucks coffee to
move from acoustic
present railway infrastructure
billion all-cash
supermarkets and other retailers
folk to electric
dates back to colonial times.
deal has fetched
under a 12-year contract.
rock ‘n’ roll.
fees to Mondelez International.
£1.6
a new, Chinese-financed
The World
with a €446 million fine and royal Bank of scotland charged
Kenya has formally launched railway, which should extend
the benchmark interest rate. Of the six banks, Deutsche Bank
reUters
12
supplier aZ electronic Materials.
After the Nairobi section is finished, with completion due
german drugs and chemicals group Merck control over apple
The cost of the railway will
$35
billion in lost revenue
in 2017, it will be extended
through 2016
through Uganda, with branch
Merck is a leading operator in
poses a huge risk for american
lines west to Kisangani in
liquid crystal displays with more
technology companies according
the Democratic Republic
than 2,500 patents. the deal
to the Information technology &
of Congo, south through
will further its presence in high-
Innovation Foundation, a policy
Rwanda to Burundi and north
tech electronic devices.
research group in Washington.
to South Sudan. Portfolio
Notebook
13
Expo 2020 fast-tracks InfrastructurE Dubai’s plans to
will fast-track infrastructure developments
develop infrastructure
such as rail projects and ramp up logistics
in time for the Expo
facilities that are worth billions of dollars.
is no less ambitious.
Remaining true to its theme of
aFP/graPheast
Dubai winning the rights to host Expo 2020
According to a Standard
sustainability, mobility and opportunity,
Chartered report, Dubai
Dubai has allocated a large chunk of its
is expected to spend around $9 billion to
Expo budget to building and developing its
fund its growth plans for the event. “Capital
infrastructure and improving its logistics
expenditure will be directed to develop
memorandum of understanding (MoU) with
facility by 2020.
city-wide infrastructure that is not already
Dubai World Central (DWC) in December
in the pipeline and the Expo area and the
to build a mega golf course and urban centre
an investment rush in infrastructure
immediate vicinity, such as the extension of
development around the new airport.
development in the host city. The Chinese
the Dubai metro red line,” said the report.
The new development will be spread
Additional investment in infrastructure
across 13.63 million square metres with
Traditionally, World Expos trigger
government spent over $40 billion on
an EC Harris study. Dubai developer Emaar signed a
developing and improving infrastructure in
development is also expected to boost the
the first phase to include a golf-course
the build up to Shanghai Expo 2010, adding
UAE’s construction sector. The UAE is
villa community, several hotels, a high-end
six new metro lines, roads, tunnels, bridges
projected to spend $329 billion on major
shopping mall, leisure attractions, and a
and a high-speed rail link.
construction projects by 2030, according to
business hub, Emaar said in a statement.
SA's Renewable Power Boom The South African government’s energy
installations were expected to reach 187
shortage that in 2008 led to the closure
policies have touched off the continent’s
megawatts last year and 601 megawatts in
of the country’s mines for five consecutive
biggest renewable power boom. It
2014, up from seven megawatts in 2012.
days. Businesses from factories to
is creating jobs in a country where
South Africa generates about 85 per
aluminium smelters currently are
unemployment has remained near 25 per
cent of its electricity from coal. The
encouraged to cut their usage 10 per cent
cent for the past four years.
addition of solar helps end a power
to prevent a recurrence.
Clean-energy developers are being
The South African government has
lured by government incentives and about
allocated 64 projects so far, which cover
360 days of sunshine a year. President
wind, concentrated and photovoltaic
Jacob Zuma is targeting 3,725 megawatts
solar, landfill gas and biomass power.
by 2016 from the 120 billion-rand
Investment in clean energy in South
programme to increase renewables, which
Africa increased more in 2012 than any
in 2012 accounted for less than one per
other country, rising 206-fold to $5.5
cent of the energy supply.
billion. Eskom Holdings, the South
The programme has made it the only markets, with installations comparable to South Korea and Thailand. Solar January 2014
African power utility, will buy the getty images
African nation among the top 20 solar
electricity from the projects for 20 years. It currently pays independent energy producers 84 cents a kilowatt-hour.
14
Notebook DUBAI EVENT: DUBAI SHOPPING FESTIVAL WEBSITE: MYDSF.AE DATE: JANUARY 2 TO FEBRUARY 2 VENUE: VARIOUS VENUES ACROSS DUBAI The Dubai Shopping Festival sees manufacturers, restaurants and hospitality industries from across the globe using the regions biggest shopping event to launch their latest products and services, along with jaw-dropping deals, discounts and raffle draws. Held over a month the 19th edition of the festival is expected to draw millions of visitors to Dubai. The first 18 events have attracted over 47 million visitors and generated more than $31 billion for Dubai’s economy.
EVENT: SGI DUBAI 2014 WEBSITE: SIGNMIDDLEEAST.COM DATE: JANUARY 7-9 VENUE: DUBAI WORLD TRADE CENTRE SGI (Sign and Graphic Imaging Middle East) is an annual trade show for sign making, graphic displays and digital printing. Showcasing the trends in products, technologies and services the exhibition attracts leading international manufacturers and suppliers from 30 countries. Many big name exhibitors such as 3M, Agfa Graphics, Canon, Epson and LG will launch new products and offer free demonstrations at their stands. The exhibition drives deals and furthers business opportunities in the region.
DUBAI
United Arab Emirates
EVENT: INTERSEC WEBSITE: INTERSECEXPO.COM DATE: JANUARY 19-21 VENUE: DUBAI INTERNATIONAL CONVENTION & EXHIBITION CENTRE Intersec is a regional trade event for the safety and security industries. Manufacturers and distributors of safety products showcase the latest technology and educate the market about cutting-edge solutions. The exhibition stands are classified under four broad categories of commercial security, homeland security, health, and fire. Issues relevant to Middle East markets will be explored in depth by leading industry players at the many conferences and seminars.
EVENT: WORLD FUTURE ENERGY SUMMIT WEBSITE: WORLDFUTUREENERGYSUMMIT.COM DATE: JANUARY 20-22 VENUE: ABU DHABI NATIONAL EXHIBITION CENTRE This preeminent gathering of international leaders in developing sustainable energy solutions will examine the rising demand for clean energy. The annual summit takes a holistic approach by bringing together major themes impacting the world’s renewable energy resources. Launching this year is the sustainable living expo that will highlight government initiatives in implementing new building regulations to drive developers to adopt more energy efficient solutions. Techtalk is another brand new seminar concept that brings together all major stakeholders, industry leaders and policymakers from across the MENA region to share views on global and Middle East-specific energy issues.
EVENT: ARAB HEALTH WEBSITE: ARABHEALTHONLINE.COM DATE: JANUARY 27-30 VENUE: DUBAI INTERNATIONAL CONVENTION & EXHIBITION CENTRE This annual event is the largest gathering of healthcare businesses and professionals across the region, and it is poised to get bigger this year with 400 new companies participating, bringing the total to 3,900 exhibitors. To accommodate the increased participation a new hall “Zabeel 4” will be used to extend the venue. This year the focus is on health concerns central to the Middle East including road accidents, diabetes and obesity. Industry leaders including Siemens, Johnson & Johnson and Samsung will offer exclusive hands-on training sessions on the most sophisticated technologies and devices. Portfolio
Observer BUSINESS NEWS IN BRIEF
17
more programmes like the one at Tognum, they maintain, the nascent recovery in US manufacturing will run out of steam for lack of qualified workers. “South Carolina offers a fantastic model for what we can do nationally,” said Ben Olinsky, co-author of a forthcoming report by the Center for American Progress, a liberal Washington research organisation, recommending a vast expansion in apprenticeships. Despite South Carolina’s progress and the public support for apprenticeships from President Barack Obama, who cited the German model in his last State of the Union address, these positions are becoming harder to find in other states. Since 2008, the number of apprentices has fallen by nearly 40 per cent, according to the Center for American Progress study.
Jeff Smith works in the assembly shop at BMW’s plant in Greer, South Carolina.
“As a nation, over the course of the last couple of decades, we have regrettably and mistakenly devalued apprenticeships and training,” said Thomas Perez, the secretary
The Value of Apprenticeships Apprenticeships are practically unheard of in the USA, leading to a shortage of qualified workers, reports Nelson Schwartz.
of labour. “We need to change that, and you will hear the president talk a lot about it in the weeks and months ahead.” In November, the White House announced a new $100 million grant programme aimed at advancing technical training in high schools. But veteran apprenticeship advocates say the Obama administration has been slow to act. “The results have not matched the
For Joerg Klisch, hiring the
headquarters in Friedrichshafen – Tognum
rhetoric in terms of direct funding for
first 60 workers to build heavy engines at
now has nine juniors and seniors enrolled in
apprenticeships so far,” said Robert Lerman,
his company’s new factory in Greer, South
its apprenticeship programme.
a professor of economics at American
Carolina was easy. Finding the next 60 was not so simple.
© 2013 New York Times News service
“It seemed like we had sucked up
Inspired by a partnership between schools and industry that is seen as a key to Germany’s advanced industrial
University in Washington. “I’m hoping for a new push.” In Germany, apprentices divide their
everybody who knew about diesel engines,”
capability and relatively low unemployment
time between classroom training in a public
said Klisch, vice president for North
rate, projects like the one at Tognum are
vocational school and practical training
American operations of Tognum America.
practically unheard of in the United States.
at a company or small firm. Some 330
“It wasn’t working as we had planned.”
But experts in government and academia,
types of apprenticeships are accredited by
along with those inside companies like
the government in Berlin, including such
back home in Germany: He set out to
BMW, which has its only US factory in
jobs as hairdresser, roofer and automobile
train them himself. Working with five local
South Carolina, say apprenticeships are
electronics specialist. About 60 per cent of
high schools and a career centre in Aiken
a desperately needed option for younger
German high school students go through
County, South Carolina – and a curriculum
workers who want decent-paying jobs, or
some kind of apprenticeship programme,
nearly identical to the one at the company’s
increasingly, any job at all. And without
which leads to a formal certificate in the
So Klisch did what he would have done
January 2014
18
Observer Besides a longstanding stigma attached
chosen skill and often a permanent job at the
to vocational education, opposition from
company where the young person trained.
entrenched interests on both the left and the
If there is a downside to the German system, it is that it can be inflexible, because
right has hobbled past efforts to promote
a person trained in a specific skill may find it
apprenticeships, including under President
difficult to switch vocations if demand shifts.
Bill Clinton in the 1990s. Here in Greer, where more than 7,000
In South Carolina, apprenticeships are mainly funded by employers, but the
employees produce more than 300,000
state introduced a four-year, annual tax
SUVs and other luxury cars a year in a
credit of $1,000 per position in 2007 that
sprawling, ultramodern BMW factory,
proved to be a boon for small- to medium-
Richard Morris, vice president for assembly
size companies. The Center for American
and logistics, identifies one of the company’s
Progress report recommends a similar credit
biggest problems: a serious shortage of
nationwide that would rise to $2,000 for
medium-skilled workers who specialise
apprentices younger than 25.
in mechatronics, or repairing robots and metal presses when they break down and operating the computers that dot the paint
The emphasis on job training has
shop, body shop and assembly shop. Not
also been a major calling card overseas for South Carolina officials, who lured BMW here two decades ago and more recently persuaded France’s Michelin and Germany’s Continental Tire to expand in the state.
Werner Eikenbusch manages workforce development for BMW in the Americas.
Apprenticeship Carolina started in 2007 with 777 students at 90 companies. It
only do these jobs pay better than typical assembly-line positions, they also open up avenues for advancement. Werner Eikenbusch, manager of
now has 4,500 students at more than 600
workforce development for BMW in the
Brad Neese, director of Apprenticeship
companies in the state, with the typical
Americas, is himself the product of an
Carolina, which links the state’s technical
apprentice in his or her late 20s. Neese’s
apprenticeship programme in Germany
college system with private companies to
goal is to have 2,000 companies by 2020.
who later went back to school and earned a
To help develop his programme, Neese
master’s degree in engineering. He helped
“The European influence is huge,” said
help create specialised programmes. “They
has travelled to Germany, Austria and
create the BMW Scholars programme in
Switzerland, where apprenticeships are
2011, he said, “to build the skills from the
in the state, with more than 28,000 workers
thriving, youth unemployment is relatively
ground up.”
for German companies alone. The influx has
low and blue-collar jobs are still prized. That
helped stanch much of the bleeding caused
contrasts with the United States, where the
Tognum’s apprentices – mostly in their 20s
by the decades-long erosion of jobs in the
economic fortunes of younger people with
and 30s – and they study full-time at local
textile industry, once the economic bulwark
just a high school diploma have plummeted,
technical colleges for two years while also
of the Palmetto state.
and the unemployment rate among workers
working in the BMW factory for 20 hours
age 16 to 19 stands at more than 20 per cent.
a week.
are our strongest partners.” European companies are major employers
There are other reasons foreign companies have moved here. For starters,
“This generation has taken a huge hit
The BMW Scholars are older than
Eikenbusch has been pitching the
wages are lower than the national
from the economic crisis,” said Alexander
programme to European parts suppliers in
average. Even more important for many
Gelber, an economist at the University of
the area, and to executives at Boeing, which
manufacturers, unions have made few
California at Berkeley and a former senior
began building sections of the new 787
inroads in South Carolina.
Treasury official. “Apprenticeships offer
Dreamliner in Charleston in 2011. He hopes
people the possibility of building skills when
they will follow BMW’s lead.
Still, the close cooperation between employers and the state educational system
they often don’t have many other options.”
is unusual, and despite initial scepticism on
So why have they not caught on in the
“We need to find a way to establish twoyear training programmes on a broader
both sides, apprenticeship opportunities are
United States like in Germany, which has 1.8
scale,” he said. “Everybody who I hire
rapidly expanding both for high-school age
million apprentices with less than one-third
is someone who is not available for our
students and for older workers.
the population?
suppliers to hire.” n Portfolio
Observer O N E 2 W AT C H TExT: HildA d’sOuzA
Roland C. Smith Office Depot, America’s largest office-supply chain, named Ronald C. Smith as its new chairman and chief executive officer on November 12 last year. Weeks prior to Smith’s November appointment the Florida-based US company merged with rival company OfficeMax in a $976 million all-stock deal. The merger aims to cut costs, consolidate stores, boost clout with suppliers and sharpen the competitive edge over market leader Staples, as well as online and discount competitors. The 59-year-old Smith said his mission at Office Depot is to generate up to $600 million in cost savings from this merger and “drive improved profitability and increased revenues.” Analysts believe Smith’s priority is to develop strategies for retaining key managers. This is crucial for the long-term success of the company, as is effectively merging the office cultures of the two companies and providing a clear vision. The board is confident that Smith has the ability to effectively integrate OfficeMax into Office Depot and boost profits. “Roland is uniquely qualified for the newly combined Office Depot and OfficeMax. He has decades of experience integrating companies and cultures and an impressive track record in turning around businesses,” said Nigel Travis, lead director and co-chair of the CEO selection committee. In the past, Smith has acted as president and chief executive of several public and private companies and numerous boards. In his former role as CEO at Belgium-based Delhaize Group he successfully orchestrated the integration of major supermarket chains and improved company profits by arranging the sale of three outlets. Prior to that Smith drove a successful merger of restaurant chain Wendy’s with Arby’s. He was credited for increasing profitability and operations and rebuilding the company’s product pipeline. He also led restructuring at American Golf Corp and AMF Bowling Worldwide Inc before his stint at Wendy’s. Smith, a graduate of the US military academy West Point, has proved to be adept at embracing risk in his leisure time by climbing mountains, riding motorcycles and test piloting flights. Professionally, this former US Army platoon leader is also up for the challenge. In his appointment note he said, “With the combined resources of Office Depot and OfficeMax, we have the ability to transform the company and create an exciting new organisation that exceeds the needs and desires of our customers, provides new opportunities for our global associates, becomes a more appealing partner to our vendors, and increases value for our shareholders.”
$5.7 Billion Credit Card Settlement Visa and MasterCard won approval for a $5.7 billion settlement that ended years of litigation with US merchants over allegations that credit-card swipe fees are improperly fixed. Once owned by groups of major banks, California-based Visa and New York-based MasterCard have defended themselves for decades against legal claims that they operated pricefixing schemes. Swipe, or interchange, fees are set by Visa and MasterCard and paid by merchants when consumers use credit or debit cards. MasterCard and Visa separated from the banks through initial public offerings in 2006 and 2008, respectively. Merchants filed a class-action lawsuit against the companies and the biggest card-issuing banks in 2005. They later alleged that the payment networks continued to fix prices with the banks even after the IPOs. Lawyers representing merchants nationwide announced the settlement in July 2012. Once worth as much as $7.25 billion, the settlement was valued at about $5.7 billion as of August 2013 as a result of reductions for about 8,000 merchants that dropped out of the damages portion. Dozens of large retailers, including Wal-Mart Stores, Amazon. com and Target, as well as major airlines, health insurers and other consumer businesses criticised the deal. Some said the amount should have been higher and that a legal release preventing future lawsuits was written too broadly. Developed by banks half a century ago as two of the earliest interstate credit-card brands, Visa and MasterCard have been subject to government scrutiny over their business practices since at least the 1970s.
getty images
20
Portfolio
Observer
21
E-waste Floods Developing World Millions of electronic devices bought over
the EU that were checked by its agents
Christmas are destined to create a flood of
contained illegal e-waste. Criminal
dangerous “e-waste” that is being dumped
investigations were launched against
illegally in developing countries, the UN
40 companies.
The global volume of electronic waste
Although it is legal to export discarded goods to poor countries if they can be
is expected to grow by 33 per cent in the
reused or refurbished, much is being sent
next four years, according to the UN’s Step
to Africa or Asia under false pretenses,
initiative, which was set up to tackle the
says Interpol.
growing e-waste crisis. Last year nearly
Few countries understand the scale of
50 million tons of e-waste was generated
the problem, because no track is kept of all
worldwide – or about seven kilograms for
e-waste, says the European Environment
every person on the planet.
Agency, which estimates between 250,000
These are electronic goods containing
tons and 1.3m tons of used electrical
toxic substances such as lead, mercury,
products are shipped out of the EU every
cadmium, arsenic and flame retardants.
year, mostly to West Africa and Asia. “These
Interpol revealed an indication of the
goods may subsequently be processed
level of e-waste being shipped to the
in inefficient conditions, harming the
developing world in December. It said
health of local people and damaging the
almost one in three containers leaving
environment,” said a spokesman.
gettY IMAges
has warned.
Barbados Tops Cyprus Debt per cent that forced
Caribbean economies expand 1.3 per cent,
Cyprus to seek a
half the rate of Latin America, according to
European Union-
the United Nations.
AFP/grAPheAst
brokered bailout
Barbados will fire 3,000 public sector workers by March and freeze wages as the
Standard & Poor’s lowered its rating on
in March 2013.
the island to BB- from BB+ in November,
Finance Minister
citing external financing challenges and a
Chris Sinckler told
high fiscal deficit. International reserves
lawmakers that
tumbled to below 900 million Barbados
the government
dollars ($450 million) in October from 1.1
risks “further
billion at the start of last year, according to
haemorrhaging” of its
Sinckler and central bank data. Total tax
reserves and the local
revenue from the April to October period
currency’s peg to the
was down 11 per cent from the same period
dollar if nothing is done. Barbados’ financial struggles are
a year earlier. The government announced a plan in
eastern Caribbean island’s debt burden
mirrored across much of the Caribbean,
August to target three per cent annual
soars and the International Monetary Fund
which has seen eight debt defaults since
economic growth, reduce the fiscal deficit
says “urgent adjustments” are needed.
2003 in six countries, including Jamaica,
below two per cent by 2020 and boost
Barbados’ ratio of debt to gross domestic
Belize, Grenada, Dominica and St. Kitts
reserves. The IMF said the government
product reached 94 per cent in September,
& Nevis. Barbados’ $3.7 billion economy
should aim to cut debt-to-GDP to below 85
according to the IMF, more than the 93
will shrink 0.7 per cent this year while
per cent by 2018.
January 2014
Observer The World
CompIled by Hilda d’souza
Top 10
Feta Cheese Sours US-Canada Trade Deal
most gender equal countries in tHe world rank
COUnTrY
1. 2. 3. 4. 5.
Iceland Finland Norway Sweden Philippines
6. 7. 8. 9.
Ireland New Zealand Denmark Switzerland
10.
Nicaraqua
SouRCe: WoRld eCoNomIC FoRum’S GlobAl GeNdeR GAp 2013 RepoRT The RepoRT RANkS 136 CouNTRIeS oN TheIR AbIlITy To CloSe The GeNdeR GAp – mAkING SuRe WomeN ARe NoT held bACk – IN FouR key AReAS: heAlTh ANd SuRVIVAl, eduCATIoN, polITICS ANd eCoNomIC equAlITy.
most gender equal countries in tHe middle east and nortH africa rank
COUnTrY
1. 2. 3. 4. 5.
United Arab Emirates Bahrain Qatar Kuwait Jordan
SCOre OUT Of 136 COUnTrieS 109 112 115 116 119
6. 7. 8. 9.
Oman Lebanon Algeria Egypt
122 123 124 125
10.
Saudi Arabia
127
GeTTy ImAGeS
22
Feta cheese makers and politicians in Greece feel that a EU free trade deal with Canada threatens the uniqueness of the protected brand. If the deal stays as it is, Canadian producers can still market their cheese as “feta”. In Canada locally made feta dominates the market. Under the trade deal, new Canadian brands of “feta” will have to call their cheese “feta-style” or “imitation feta” and cannot evoke Greece on the label, such as using Greek lettering or an image of ancient Greek columns. Feta is among 145 iconic food and drink names covered by a EU Protected Geographical Indication. The special status prevents other manufacturers in the EU copying the original, traditional product and marketing it like the original. The list includes many other cheeses such as Italy’s Parmesan and Gorgonzola, various hams such as Bayonne (France) and Parma (Italy), and some beers such as Bayerisches (Germany) and Ceske (Czech Republic).
most gender equal countries in asia and tHe Pacific rank
COUnTrY
SCOre OUT Of 136 COUnTrieS
1. 2. 3. 4. 5.
philippines New Zealand Australia mongolia Sri lanka
5 7 24 33 55
6. 7. 8. 9.
Singapore lao pdR Thailand China
58 60 65 69
10.
Vietnam
73
Feta is a national symbol in Greece worst hit by the Eurozone crisis, where national pride has taken a battering. A court ruling in 2005 gave Greece a monopoly on the name in the EU. The feta industry accounts for more than 70 per cent of Greek cheese exports and – unlike much of the struggling Greek economy – it is expanding. Some 300,000 Greek livestock farmers earn a living from feta. The EU-Canada deal, clinched in October last year after more than four years of hard bargaining, still has to be ratified by the parliaments of all 28 member states, each government and Canada’s 10 provinces. Therefore the deal is unlikely to take effect until 2015 at the earliest. Portfolio
Commentary
24
Damian Carrington
Deforestation On the Rise Destruction of the AmAzon
running through Para and Mato Grosso
rainforest increased by almost one-third
states, which eases the transport of illegal
in the past year, reversing a decade-long
timber. Another factor is high global food
trend of better protection for the world’s
prices which drives forest clearance for
greatest rainforest.
cattle and soya farming. “There are various ways to spin this
Environmentalists blamed a controversial weakening of legal protections passed by
figure, but there’s no way it’s good news,”
President Dilma Rousseff for the increase
said Dr Doug Boucher, an expert on tropical
in deforestation by loggers and farmers.
forests at the Union of Concerned Scientists.
But the environment minister, Izabella
“Certainly the amendments to the Forest
Teixeira, rejected this, saying the overall
Code were one reason. It’s a warning that
trend was “positive” and that eliminating
although deforestation can be reduced
illegal deforestation remained the
rapidly and dramatically by strong policies,
government’s goal.
it can also increase again when those policies are weakened.”
The set-back in the Amazon came as the
Brazil has demanded funding from rich
first global, high-resolution, satellite analysis 2000 an area equal to 50 football pitches has been destroyed every minute. The total loss is 10 times the area of the UK, with only a third being replaced by natural and
sensitive to criticism of its effort to develop
Deforestation in the Amazon increased by 28 per cent last year.
and improve the living standards of its 200 million people. About three-quarters of Brazil’s emissions
planted reforestation, and the destruction is
surprised by this increase in deforestation,
come from rainforest clearing, as trees are
accelerating in the tropics.
given that their own action is what’s pushing
burned or felled and rot, making the nation
it. The change in the Forest Code and the
the world’s sixth-biggest emitter of carbon
contributor to the emissions that drive
resulting amnesty for those who illegally
dioxide. The new global satellite study
climate change. Trees provide a vital store
felled the forest sent the message that such
shows that Indonesia, despite being just a
of carbon, as well as providing livelihoods
crimes have no consequences.”
quarter of the size of Brazil, now destroys
The razing of forests is a major
for a billion people. But deforestation has
The revised Forest Code was passed in
about the same area of forest. “Recent progress has been made with
more than doubled in Indonesia, Paraguay,
2012 after more than a decade of efforts
Malaysia and Cambodia, largely due to
by Brazil’s powerful agricultural lobby.
Indonesia’s forest moratorium, which
illegal logging.
The changes eased restrictions for smaller
prevents new licenses to clear primary forest,
landowners, allowing them to clear land
but it suffers enforcement challenges,” said
data has helped the government slash
closer to riverbanks, and allowed those who
Professor Matt Hansen, at the University of
deforestation by 80 per cent since 2003-4
had illegally felled land to not face penalties
Maryland, who led the global satellite study
by allowing police to pinpoint illegal activity
if they signed an agreement to replant
with Google and other researchers. “It’s too
in the vast forest, which is bigger than
trees, which many environmentalists say is
early to tell if the moratorium has actually
western Europe. But the 5,800km2 in 2012-
unlikely to be enforced.
reduced forest loss.”
In the Amazon, the use of satellite
© 2013 GuaRDian nEwS & mEDia
nation’s to cut deforestation and has been
aFP/GRaPHEaST
of global deforestation revealed that since
13 was a 28 per cent increase on the recordlow in the previous year.
Adario added that the push by Rousseff’s
Hansen said “timely” annual updates
government for infrastructure projects in
of global deforestation will start early this
the Amazon region was also a cause, noting
year: “Prior to this, most information about
Amazon campaign, said the spike was
that much of the recent destruction was
forests is years out-of-date by the time it
scandalous: “The government can’t be
along a government-improved highway
finds its way into policymakers’ hands.” n
Paulo Adario, leader of Greenpeace’s
Portfolio
Profile
26
Unity is Strength Jérôme Lambert, the recently appointed CEO of Montblanc, believes it is vital for the brand to retain a unified approach but yet be sensitive and adapt to the local norms of the countries it operates in, reports Emma Hodgson.
FOUR MILLENNIA AGO, BEDOUIN
Towers hotel in the business district of
between the tradition of Montblanc, and
tribesmen were training birds of prey to
Dubai. He is keen to show me a new
the reality of the cultures in the countries
hunt hare and Houbara Bustards as they
black leather falconry glove, which was
where we are developing our activities. It
travelled across the desert sands of Arabia.
especially designed for the Montblanc
shows respect for the country’s culture we
This ancient way of life is ingrained in
Abu Dhabi store launch.
are entering and our willingness to create.
Arab culture, which is why the golden
Lambert believes it symbolises
falcon is at the centre of the United Arab
the essence of Montblanc under his
Emirates’ official emblem.
leadership: a unified brand that is
I am reminded of that fact when I meet Jérôme Lambert, the new CEO of Montblanc, at Jumeirah Emirates
sensitive to local norms. “It is very important for the brand’s expression that the product is a bridge
We do not want to replicate the same format in every country.” Lambert is an enigmatic force. About 5’8 in height, he wears a dark blue Italian Ermenegildo Zegna suit and speaks passionately in English and French about Portfolio
27
J茅r么me Lambert became CEO of Montblanc in July last year. January 2014
Profile
28
the pan-European German brand which he now represents. Lambert joined Montblanc in July 2013 after a 12-year stint as CEO of the 180-year-old French watch company Jaeger-LeCoultre, which belongs to the Swiss luxury goods group Richemont that also owns Montblanc. In November 2013, Richemont posted a four per cent sales growth to ¤5,234 million for the six month period ended in September. Profit for the period rose by 10 per cent to ¤1,185 million. In 2012, Montblanc posted sales of ¤723 million, up from ¤672 million in 2011. Lambert’s move from a company with a long history of watchmaking to one that produced its first watch collection in 1999 is quite a change. I ask Lambert what obstacles he’s faced in his first few months in charge. “The biggest challenge is when you have been working for the same company
Lambert at the official Montblanc opening of The Galleria Boutique in Abu Dhabi last November.
for 15 years, which includes 12 years as
was later to give the company its new name,
CEO. You begin to have automatic ways
Montblanc. Today, Montblanc writing
of working with people. You don’t have to
instruments command 75 per cent of the
think anymore because you know the flow,
global market. During the past 107 years the
you know the decision process and how it
company grew to encompass jewellery and
will be enforced.”
leather goods, with their most recent brand
Lambert’s emphasis is on people and culture. His focus on building a local
extension being watches. Throughout, the company’s focus
identity for the international brand he
has remained on their products as
represents is integrated in his description
fine lifetime companions. The closest
of adapting to Montblanc as its new CEO.
Montblanc comes to the digital market
“You have to find the nerve centre in the
is around the periphery, such as bespoke
body of the company,” he explains. “You
high-end smartphone and tablet cases.
need to find it when it comes to decision
Lambert, however, doesn’t feel threatened
making and processes, as it affects your
by a marketplace increasingly dominated
ability to have an impact. It determines
by digital platforms.
how you can have a positive and effective
“When you ask people if they have
impact on the business of your company.
signed a contract electronically or with
“As a new CEO you have to learn, you
a writing instrument lately, 90 or 95 per
have to analyse, and you have to get along
cent are still signing physical contracts.
with the culture of the company in order
There is also a symbolic power in
to integrate yourself.”
receiving a fine writing instrument. A fine writing instrument symbolises the access
The Montblanc Falcon Glove was specially designed for the UAE market.
CLAUS-JOHANNES VOSS, the banker
to power, the act of engaging. It is strong
Alfred Nehemias and the engineer August
in terms of message and in terms of this
Eberstein founded the Simplo Filler
symbolic meaning.”
Pen company in 1906 as a producer of
Lambert has a point. The Meisterstück
up-market pens in the Schanzen district
pen has and is being used by so many
of Hamburg. In 1910 they released the
presidents and heads of states that it is
Meisterstück (Masterpiece), the pen that
nicknamed the ‘power pen’. Think of an Portfolio
29
important treaty and it was probably
natural human link wanting to physically
it is nothing. Yet you strongly feel that
signed with a Montblanc. It is little wonder
write, to say ‘I want to add to what I am,
something is missing and it shows how
then that the CEO believes that Montblanc
what I was and what I will be to eternity’.
important this object, and how important
writing instruments still have a future.
Religion can be a good solution... But
the choice of these objects, can be.”
there is something key about leaving a
Lambert’s relationship with his
“I would not say the question is ‘is it the end of writing?’ At Montblanc we
mark to the nature of human beings.”
Montblanc products reflects this intimate
have strong watch sales, but we can also
In 1820 the poet Lamartine wrote
quality. For example, he always uses his
sustain the value of fine writing. There is
the line “Un seul être vous manque, et
Montblanc Starwalker pen to jot down
change, but there is no conclusion, and
tout est dépeuplé” [When one person is
ideas while travelling. “When you travel
it is up to us to enforce and reinforce the
missing, it can feel as though the whole
you get different ideas. Yet it is sometimes
symbolic value so that there is a future.”
world is empty]. According to Lambert,
hard to have precise ideas while you are
the essence of this old French idiom is
interacting with people, so you have to
be something intrinsically human about
intrinsic to the contemporary message of
get the ideas out of your mind. To express
wanting to leave a tangible mark on the
Montblanc. “You miss one single person
yourself you have to go inside your mind,
world. Lambert agrees, saying that the
and it feels like there is nobody around
and what you write has to be very precise
viability of his products lies at the heart
you. When you leave home and you
and the tool impacts this result. I like the
of human psychology. “As soon as a person
forget to take, for example, your watch,
Carbon Starwalker’s precise way of writing.
I suggest to Lambert that there may
realises that life is a temporary contract,
What is the use of writing something
there is a desire to survive but also to
blurred that you can’t read back home?”
exist, and the best way to do this is to
His emphasis is again on the
leave a mark,” explains Lambert. “The prehistoric Lascaux paintings (17,000-year-old cave paintings in France) are evidence of this, as predecessors of writing. It reflects the same human necessity to say ‘I want to leave a mark’. It is a
compatibility between modernity
“There is a symbolic power in receiving a fine writing instrument. A fine writing instrument symbolises the access to power, the act of engaging. It is strong in terms of message and in terms of this symbolic meaning.”
The stylish interior of the Galleria Boutique in Abu Dhabi. January 2014
and tradition. “Our new range is craftsmanship between technologies.” He takes his smartphone out of his pocket and says, “I hate the cold plastic, I don’t like the feel of it. That is why with our new phone cover we
Profile
30
GETTY IMAGES
“I hate the cold plastic, I don’t like the feel of it. That is why with our new phone cover we are injecting resin into the leather so it is light and flexible. I like the contact with leather as it’s warm, alive and soft.”
Montblanc CEO Jérôme Lambert, model Karlie Kloss and President & CEO at Montblanc North America Jan-Patrick Schmitz celebrate the Madison Avenue Boutique opening.
are injecting resin into the leather so it is
television advert a young man is depicted
network or proper media and press
light and flexible.
using the brand to win back his art
support to make your competence known.
I like the contact with leather as it’s warm,
student ex-girlfriend. He does this by
So you select a viable marketing approach
alive and soft.”
flying her to Europe in his father’s private
for the brand and its category, and
jet so she can pick out a Montblanc watch.
somehow there is a true tropicalisation
whips off his belt whilst apologising
I ask Lambert if he thinks there is a
(adaptation) of the brand. And that
about getting undressed before a lady.
potential schism in the company’s image
tropicalisation reflects the brand adapting
“See, there is no stitching as this is a very
by targeting the southern hemisphere
itself to the country.
particular type of belt made in Florence.
youth market, which is in stark contrast
“My job is to unite the house, to make
There we put the leather together and
to the older writing instrument focus in
it strong and consistent so it will always
we stitch the belt in the back so you have
the European market.
be able to adapt itself to the countries and
To make sure I get the point Lambert
much more flexibility. It is pure leather.
“I don’t believe the different approaches
their specific needs.”
Very simple, very clear and very elegant
oppose each other as they compliment
when it comes to the expression of what
themselves. Even if the brand changes its
of the luxury goods market there is little
Montblanc stands for, Volia!” he laughs.
role it remains a fine lifetime companion
reason to think that he won’t succeed
and that is where the consistency is. So
in writing another successful chapter in
THE SOUTHERN hemisphere has
all these different elements come together
become increasingly important to
to create consistency. In some countries
Montblanc, with China having an
one may not have a proper distribution
With Lambert’s passion and knowledge
Montblanc’s history. n
insatiable appetite for luxury goods. The 2013 KPMG Global Reach of Chinese Luxury report highlighted the company’s dominance in the region, with Montblanc posting their fastest growth in watches. Lambert acknowledges that the figures are
The Meisterstück pen has and is being used by so many presidents and heads of states that it is nicknamed the ‘power pen’.
impressive: “In the past five years watches have been up 79 per cent all over the southern hemisphere, but mainly in Asia, so that is the category that has been growing.” In a recent Chinese Montblanc Portfolio
32
Nature Gives, Nature takes The Philippines has abundant geothermal energy, but Typhoon Haiyan destroyed the electricity infrastructure, reports Keith Bradsher.
Portfolio
the electricity is sold to other islands in
is the world’s second-largest producer of
the Philippines.
geothermal energy, after one in California.
Or at least that is the way it is supposed
Yet the operation is remarkably little
to work. When Typhoon Haiyan barrelled
known even among renewable energy
across Leyte Island in November with
experts because of its unusual history and a
a tsunami-like storm surge and nearly
lingering penchant for secrecy for national
tornado-strength winds, killing thousands
security reasons.
of people and effortlessly tearing the roofs
The New People’s Army, one of the
off homes, it also damaged the crucial
world’s longest-lasting Maoist insurgencies
geothermal operations here.
and an enduring though low-intensity
For many in the Philippines, the damage
threat on Leyte Island, represents a
here exemplifies a broader paradox: a
potential risk to the operations. A small
storm consistent with some scientists’
army of soldiers and security guards
warnings about climate change has done
defends the site and maintains layers of
tremendous damage to an island that is
checkpoints to keep visitors out of the
one of the world’s biggest success stories of
mountain valley where five geothermal
renewable energy, and to a country that has
power plants are.
contributed almost nothing to the global accumulation of greenhouse gases.
The extraordinary force of Typhoon Haiyan’s winds shattered the coconut palm forests that line the steep, narrow valley
Clouds of steam surge from
geothermal energy. Particularly near the ridgelines, kilometre after kilometre of trees have changed from green to brown since the winds tore loose virtually every frond. The winds then twisted and bent the usually resilient trunks until they snapped or burst. Sheltered in the valley below, however, the homes of the site’s 795 workers seem to have fared surprisingly well, although one of the military barracks has lost much of its green, corrugated steel roof. the environment at Energy Development
“Many Filipino families have become
Corp, which owns the power plants, said
fissures in the earth along the beds of
climate refugees,” said Senator Loren
no one was killed or seriously injured at
mountain streams that splash down slopes
Legarda, chairwoman of the Philippine
the plants during the typhoon, even as the
carpeted with coconut palm forests, hints
Senate’s standing committee on climate
storm surge on the opposite side of the
of the enormous source of renewable
change. “We may not pollute the world,
island, 80.5 kilometres to the east, killed
energy that lies underground.
yet we are victims of extreme weather and
thousands in the coastal cities of Tacloban,
climate change.”
Palo and Tanauan.
Engineers have drilled a series of boreholes 1.6 kilometres down into hot © 2013 New York Times News service
that for years has churned out so much
Agnes de Jesus, senior vice president for
reuTers
A contract worker surveys pipes under general maintenance at a Chevron geothermal steam well in Bay Laguna south of the capital Manila.
The Tongonan geothermal field on the outskirts of Ormoc on western Leyte Island is the world’s secondlargest producer of geothermal energy, after one in California.
As if to highlight that rueful conclusion,
Responding to the Arab oil embargo of
volcanic rocks, tapping into superheated
the UN climate talks in Warsaw, Poland,
1973, President Ferdinand Marcos began
water under enormous pressure. The
which unfolded as the world became
developing the field in the late 1970s with
water surges to the surface, expands into
aware of the typhoon’s savagery, were
a small demonstration project. The goal
steam and then cools, spinning a series of
marred by bitter quarrels between rich
from the start was not environmental,
turbines that produce five times as much
and developing nations.
but nationalistic and economic: to reduce
electricity as all of Leyte Island, with 1.5
The Tongonan geothermal field on the
million people, can consume. The rest of
outskirts of Ormoc on western Leyte Island
January 2014
the Philippines’ dependence on imported energy and save money on fuel bills.
Energy
33
Energy
34
Melissa Abadia, who moved from Spain to find employment three years ago, works in the stock room of River Island, a store where she now works, in Amsterdam.
Leyte Island is the world’s second largest producer of geothermal energy.
After the demonstration project proved successful, five large geothermal plants were built atop boreholes in the same valley in the mid-1990s, each big enough even today to power the entire island. Each of the five was built by a different company, and then all five transferred them to a state-owned entity. The state-owned company subsequently privatised them and they became Energy Development Corp, a company listed seven years ago on the Philippines Stock Exchange.
The valley differs from many geothermal sites around the world in that the underground rocks are hotter and what comes up through the boreholes is super-pressurised water, not steam.
towers with an identical construction or build new ones that may be more durable, said Leonita Sabando, environmental management chief at the site. The fifTh power plant does the expansion from water to steam, the cooling of the steam and the condensation of the steam in a single complex that is also high on the valley wall. Yet it does not protrude so high above the surrounding terrain, and so suffered much less damage. The company is testing all of the components of
The valley differs from many geothermal
that power plant in the hope of bringing it
sites around the world in that the underground rocks are hotter and what
further turbines as the steam cools. Finally,
back into full service and repowering Leyte
comes up through the boreholes is
those four power plants were designed to
Island by December 24, the national target
super-pressurised water, not steam. The
condense the steam into water in steel-
for restoring electricity after the typhoon,
underground water is at a scalding 249
reinforced wooden cooling towers for
de Jesus said.
to 349 degrees Celsius. Four of the power
reinjection into the ground.
plants essentially rely on two steps: First
The typhoon destroyed all four cooling
Replacing broken poles for electricity transmission across Leyte Island presents
they spin turbines using the tendency
towers, splintering the wood and casting
another challenge. Phil Morales Jr.,
of water at such high temperatures to
aside the steel. Energy Development Corp
leader of a digging team in central Leyte,
expand into steam, and then they spin
is studying whether to replace the cooling
estimated that only 10 per cent of the poles Portfolio
are either new or survived the storm along
significantly for another million years,
underground water is piped from near
the 80.5-kilometre segment that is his
while the underground water is being
Xi’an to heat thousands of homes there
responsibility; even fewer poles survived on
constantly recharged by water percolating
in winter.
links to villages to the north and south of
down from the surface.
the main east-west route.
Although geothermal power has been
As sunshine alternated with squalls one recent afternoon, a succession of bright,
a success here, few other countries,
luminous rainbows soared over the valley.
December, but not the laterals,” he said
notably tiny Iceland, have similar
They drew comparisons to the rainbow
as he and his team paused for lunch in
resources to tap. Geologists in China,
that the Bible describes Noah as seeing, as
sweltering heat in Tunga, a town in the
the largest emitter of global warming
a pact that after the great flood, humanity
hills of central Leyte.
gases by a wide margin, have not found
would endure.
“The backbone should be energised by
Other islands have not suffered electricity failures, except as a result of
comparably hot underground water for electricity generation there, although warm
Energy
35
“It’s a hope that we can revert to normalcy, it’s a sign to us,” de Jesus said. n
damage to transmission lines, as power plants elsewhere in the Philippines have made up for the loss of the geothermal capacity, said Cynthia Alabanza, spokeswoman for National Grid Corporation of the Philippines. About one-ninth of the Philippines’ electricity consumption comes from geothermal power, mostly generated here; geothermal power produces half the electricity in the central Philippines, but a tiny share for the energy-hungry northern Philippines, including Manila, which relies more heavily on coal. Engineers for the project forecast that the underground rocks, heated by volcanic reuters
activity one million years ago, will not cool A woman dries her laundry next to pipes carrying hot geothermal steam.
Estenislao Delacruz prays by candlelight in his home, damaged by Typhoon Haiyan, in Tacloban.
January 2014
36
EducatEd YEt unEmploYEd Youth unemployment has grown to staggering levels in many EU countries, dashing dreams and forcing many to leave their countries, reports Liz Alderman.
Portfolio
Employment
37 Melissa Abadia moved from Spain to find employment in Amsterdam.
A student checks an advertisement board with job postings in Madrid.
that went nowhere and employers who
with a master’s degree in sociology, sprang
increasingly demanded that young people
out of bed nervously one recent morning
work long, unpaid stretches just to be
of young Europeans. Five years after the
in Madrid, carefully put on makeup and
considered for something permanent.
economic crisis struck the Continent, youth
styled her hair. Her thin hands trembled as
© 2013 New York Times News service
‘What did I do wrong?’”
AlbA Méndez, A 24-yeAr-old
Her parents were imploring her to
This question is being asked by millions
unemployment has climbed to staggering
she clutched her résumé on her way out of
return home to the Canary Islands to help
levels in many countries: in September, 56
the tiny room where a friend allows her to
run her father’s fruit business. It was a sign
per cent in Spain for those 24 and younger,
stay rent free.
of the times, though, that even her own
57 per cent in Greece, 40 per cent in Italy,
father probably would not be able to afford
37 per cent in Portugal and 28 per cent in
to pay her.
Ireland. For people 25 to 30, the rates are
She had an interview that day for a job at a supermarket. It was nothing like the kind of professional career she thought she
“We’re in a situation that is beyond our
half to two-thirds as high and rising. Those are Great Depression-like rates
would have after finishing her education.
control,” Méndez said. “But that doesn’t stop
But it was a rare flicker of opportunity after
the feelings of guilt. On the bad days, it’s
of unemployment, and there is no sign
a series of temporary positions, applications
really hard to get out of bed. I ask myself,
that European economies, still barely
January 2014
Employment
38
Abadia, who studied to be a nurse, works in the stock room of a clothing store.
emerging from recession, are about to generate the jobs necessary to bring
leaving this one out. George Skivalos, 28, had to move back in
those Europeans into the workforce soon,
with his mother two years ago in Athens,
perhaps in their lifetimes.
Greece. “Even if we get out of the crisis, maybe in four years, I’ll be 32, and then
the protection of family but a dearth of
around the Continent reveal a creeping
what?” Skivalos said. “I will have missed
jobs. Or they can travel to Europe’s north,
realisation that the European dream their
the opportunity to be in a company with
where work is possible to find but where
parents enjoyed is out of reach. It is not that
upward mobility.”
they are likely to be treated as outsiders.
Dozens of interviews with young people
Europe will never recover, but that the era
Instead, many in the troubled south
There, young people say, they compete
of recession and austerity has persisted for
are carving out a simple existence for
for low-paying, temporary jobs but are
so long that new growth, when it comes,
themselves in a new European reality. They
sometimes excluded from the cocoon of
will be enjoyed by the next generation,
must decide whether to stay home, with
full employment. For the European Union, addressing the issue has become a political as well as an economic challenge at a time of expanding populist discontent with the leadership in Brussels and national capitals. Chancellor Angela Merkel of Germany has called youth unemployment “the most pressing problem facing Europe.” Merkel flew to Paris in November to join other European leaders at a special youth unemployment summit meeting called by President François Hollande of France. Governments renewed a pledge for an employment-promotion programme worth ¤6 billion (about $8 billion) starting this
REUTERS
year. But economists said the programme by itself was unlikely to put more than a German Chancellor Angela Merkel (L) and European Commission President Jose Manuel Barroso at an international summit on youth unemployment in November.
bandage on a gaping wound. “We hope 2014 will be a year of recovery,” Portfolio
Employment
39
said Stefano Scarpetta, the director of employment, labour and social affairs at the Organisation for Economic Cooperation and Development. “But we are still looking at a very large number of youth who will have endured a long period of extreme difficulty. This will have a long-lasting effect on an entire generation.” Soon after her 23rd birthday four years ago, Melissa Abadía made a wrenching decision: She would leave her close-knit family in Spain, where the grinding fallout from the 2008 financial crisis had made securing a good job impossible, and move to the Netherlands, where employers were still hiring. “When I got on the plane, I was crying,” Abadía, a bright, ebullient woman, recalled.
Alba Mendez, centre, who has a master’s degree in sociology, has only found temporary employment in Madrid.
“But I had to decide: Should I fight for
what it’s like to be seen as someone who’s
something back home that makes no
coming to steal jobs,” she said.
sense, or get out of there and make a life for myself?” Despite five years of training
She soon found better-paying work at the clothing shop, near the Royal Palace.
in nursing in her hometown, Castellón de
She spent two years bouncing between
la Plana, in eastern Spain, she now works
short-term contracts, which employers have
in a windowless stockroom in Amsterdam
sharply increased during the crisis to avoid
organising purses, socks and other
the expensive labour protections granted to
accessories at a clothing store.
permanent employees.
It is a sign of the plight of her generation
In some countries, especially those with
Dozens of interviews with young people around the Continent reveal a creeping realisation that the European dream their parents enjoyed is out of reach.
that simply having a job and a measure
the highest youth unemployment rates,
of independence makes her one of the
short-term contracts are nothing more
lucky ones – never mind homesickness,
than opportunities for employers to take
still does not qualify for the Netherlands’
dashed dreams of a very different career
advantage of the weak labour market. But
monthly minimum wage of ¤1,477 (about
and a gradual acceptance that her life will
when used by employers as intended – to
$2,000), and her new career was a long way
probably never be the one she expected to
give experience to young people who
from where she had hoped to end up.
live. “Of course, I hate the fact that I have to
otherwise could not get a start – they can
do this,” she said, speaking in sombre tones.
lead to steady work. That was the case
her situation with two colleagues from
“Leaving your country should be a decision,
with Abadía, whose employer eventually
the store, both from Spain. All three
not an obligation.”
turned her temporary job into a permanent
were angry at what they saw as chronic
contract with benefits overseeing the store’s
mismanagement of the Spanish economy.
biggest stockroom.
With Spain adhering to austerity policies
Finding only unpaid nursing internships and a temporary nightclub job in Spain,
As she sat in her apartment, she discussed
On one level, having even that kind of
prescribed by its international creditors
Europe’s more prosperous north. She
employment is a victory in today’s Europe.
and Germany, they said, conditions had
quickly found employment as an au
Her salary of ¤1,200 a month (about
deteriorated so badly that they saw no light
pair in Amsterdam. For the first time,
$1,600) was nearly twice what she could
at the end of the tunnel.
she experienced the shock of being an
have made in Spain. “The day I signed a
immigrant. Having arrived in Amsterdam
permanent contract was the best day of
lose a couple generations of smart, young
as part of an influx of young Spanish, Greek,
my life,” she said one recent weeknight,
people,” Abadía said as her friends nodded
Italian and Portuguese men and women all
beaming as she sipped a Coke at a bustling
in agreement. “And then what will happen
searching for any employment, “I now know
pub. But because of her work hours, she
to the country that’s left behind?” n
Abadía scoured the internet for work in
January 2014
“If they don’t fix things, they are going to
40
Canadian Crude Hits tHe rails The delays and protests around the proposed Keystone XL pipeline has led Canadian oil producers to increase their rail-loading capacity, reports Clifford Krauss.
Portfolio
Energy
41
years to as much as 900,000 barrels a day,
environmentalists have chained themselves
up from 180,000 today. The acceleration
spawned innovation and mobilised
to the White House fence and otherwise
has come despite a derailment in the
alternatives, and rail is a clear part of
coalesced around stopping the Keystone
lakeside Quebec town of Lac-Megantic
the options available to our industry,”
XL pipeline as their top priority in the
in July, in which a runaway oil train
said Paul Reimer, senior vice president
fight against global warming. But even
bound for a refinery in eastern Canada
in charge of transport and marketing
if President Barack Obama rejects the
exploded, killing dozens of people and
at Cenovus Energy, a Canadian oil
pipeline, it might not matter much.
bankrupting the railway company. That
company that is planning to increase rail
Oil companies are already building rail
accident and others more recently have
shipments from 7,000 barrels a day to as
terminals to deliver oil from western
renewed concerns about the safety of
many as 30,000 barrels a day by the end
Canada to the United States, and even
transporting oil by rail and given an
of 2014.
to Asia.
added argument to some who favour the
Since July, plans have been announced
© 2013 NEW YORK TIMES NEWS SERVICE
“The indecision on Keystone XL really
OVER THE PAST TWO YEARS,
Keystone XL pipeline.
Opponents want to stop the pipeline project to keep the oil sands in the ground. They say that emissions from
for three large loading terminals in
“They don’t give up,” Jesse Prentice-
western Canada with the combined
Dunn, a Sierra Club policy analyst, said
development – through mining or steam
capacity of 350,000 barrels a day –
of the oil industry.
heating out of the ground followed by
equivalent to roughly 40 per cent of the
If all the new terminals are built,
upgrading for shipment – are more
capacity of the proposed Keystone XL
Canada will potentially increase its exports
harmful than those that come from
pipeline that is designed to bring oil from
to the United States by more than 20 per
extracting most conventional crude oil.
western Alberta to refineries along the
cent – even if Keystone XL is never built.
Proponents say that Canadian heavy
Gulf Coast.
Shipping by rail can cost an additional $5
oil is no more environmentally harmful
or more per barrel, but oil companies have
than some crude oils already used in the
decided that they cannot afford to wait.
United States and that it would replace
Overall, Canada is poised to quadruple its rail-loading capacity over the next few
Rows of steam generating plants at Cenovus Energy’s Christina Lake oil sands operation in Alberta, Canada. January 2014
Railways can potentially give Canadian producers a major outlet to oil-hungry China, including from refineries in Washington and California. At least that is the hope of Canadian oil companies, which now depend almost solely on the United States for exports.
Savage have announced a joint venture
sides of the border to relieve the pipeline
to build a $100 million, 17-hectare oil-
congestion, and now an estimated 175,000
handling plant in the Port of Vancouver
barrels of Canadian crude are running by
on the Columbia River that could handle
rail daily, according to a recent report by
380,000 barrels of oil each day if permits
Peters & Co, a Canadian investment house.
are granted.
The Canadians remain a few years behind producers in North Dakota, where
At the beginning of the year, only a
the paucity of pipelines encouraged
trickle of Canadian oil was transported
early oil explorers like EOG Resources
by rail, no more than 60,000 barrels a
to form a partnership with Burlington
day. There was limited rail off-loading
Northern Santa Fe to build terminals for
capacity in US refineries outside the Gulf
the shipment of oil by rail to refineries
Coast, and only a small number of rail
across the country. Today more than three-
cars suitable to transport bitumen, the raw
quarters of North Dakota’s production,
substance in oil sands that can be refined
which also was to move on the Keystone
into petroleum products.
XL pipeline, is transported by rail. The
But Canadian oil executives were making preparations for more rail
Canadian oil producers took notice. “The market woke up when all of a
traffic. Congested pipelines in the United
sudden in 2012 they built 20 terminals
States were producing localised gluts of
in North Dakota, and now people are
Canadian crude, forcing producers to offer
jumping on the bandwagon,” said Sandy
similar crudes from Venezuela and Mexico
discounts that cut into profits. In response,
Fielden, director of energy analytics at
that are refined on the Gulf Coast.
executives ramped up rail projects on both
RBN Energy, a consultancy. “Oil will find
But now it seems that even if environmentalists win their battle over
Opposition to the proposed Keystone XL pipeline has been intense.
Keystone, Canada is destined to become an even more important energy provider, one way or another. The developing rail links for oil sands range across Canada and over the border from the Gulf Coast to Washington and California. Railways can potentially give Canadian producers a major outlet to oilhungry China, including from refineries in Washington and California. At least that is the hope of Canadian oil companies, which now depend almost solely on the United States for exports. “We want to diversify our markets beyond just moving our product south,” said Peter Symons, a spokesman for Statoil, a Norwegian oil giant that has signed contracts to lease two Canadian oil loading terminals. “We can get that product on a ship and get it to premium markets in Asia.” Several Washington and Oregon refiners and ports are planning or building rail projects for Canadian heavy crude as well as light oil from North Dakota. Texas refinery giant Tesoro and oil services company
reuters
Energy
42
Portfolio
43
Firefighters spray water on the wreckage of the train explosion in Lac Megantic, which was carrying Canadian crude oil.
a way to market whether it has to come by truck or pipeline or rail.” With or without Keystone, transporting oil by rail has raised concerns over safety and increased air pollution from extra train traffic. The city of Benicia, California, in September delayed the granting of a permit for Valero Energy’s planned rail terminal at its refinery by deciding to require an environmental impact report after residents expressed concerns that Valero would use the terminal to import Canadian oil sands crude. Much of the concern centres on safety. In October, a train carrying crude oil and liquefied petroleum gas derailed west of Edmonton, causing an explosion and fire and forcing the evacuation of a town. In September, a Canadian National Railway Company train carrying lubricating oil, ethanol and natural gas liquids between
reuters
Winnipeg and Edmonton derailed in Saskatchewan, leading to a leak on farmland and well-publicised comments by Saskatchewan’s premier, Brad Wall, that the accident underscored the need for more pipelines to safely move petroleum products. Shipping oil by rail is generally more expensive than by pipeline, but the oil companies working in North Dakota made a critical innovation – leasing complete 100-car trains dedicated to oil rather than using traditional trains that ship a variety of products. By shipping directly from the oil fields to refinery depots, the companies sped deliveries and lowered costs. Rail lines are also easier and faster to build than pipelines, particularly since permitting of pipelines can take years and the applications are sometimes rejected. “We would like to bring that crude oil down by pipeline, specifically the Keystone XL pipeline, but we also want to have access from rail and ship,” said Bill Day, a vice president at Valero, which is building a rail unloading facility to handle heavy oil from Canada at its St. Charles, Louisiana, refinery. “We want multiple means to deliver crude oil to our refineries.” n January 2014
Retail
44
The Chalhoub Group, founded in Damascus by Michel Chalhoub and his wife Widad in 1955, is a powerhouse in the luxury goods sector, reports Nick Rice.
If the Shoe fItS Portfolio
45
As I sIt down for A coffee with Patrick Chalhoub it becomes immediately obvious that he doesn’t need one. He is positively effervescent and I wonder what effect the espresso will have on his already impressive energy levels. When considering the scale of the Chalhoub Group’s operations though, such bursting drive and vibrancy must be prerequisites. Since 2001, alongside his brother Anthony who runs operations in Kuwait and Egypt, Patrick Chalhoub has overseen a business that now has 7,000 employees and 400 retail outlets in 14 countries. Founded nearly six decades ago by his mother and father (still chairman and vice getty images
chairwoman), the Chalhoub Group started out with just one luxury brand on their books – the renowned French silverware makers Christofle. With the 1955 opening
Dubai Mall boasts the world’s largest shoe shop.
of a Christofle boutique in Damascus, Michel Chalhoub’s empire had begun. That first deal expanded to representation within Syria for the Baccarat and Jean Patou brands and Michel Chalhoub’s first special order was to supply the then Syrian President, M. Chucri Kouatly, with Baccarat crystalware and Christofle silverware. Now with nearly 300 prestigious brands in the current portfolio, it’s safe to say the Chalhoub family found a market that suited them and they flourished. The Level Shoe District offers an unparalleled selection of women’s and men’s exclusive shoes.
Patrick Chalhoub began his career in the family business in 1979 when he decided to join the efforts of his father in bridging the distinct worlds of the East and West, establishing the Chalhoub name as a reputable ambassador of luxury lifestyle in the Middle East. As he tells me in his open and friendly manner, “The Chalhoub Group was the first enterprise to enter the luxury market in the Middle East. We wanted to build a bridge between the Western culture of luxury and refinement in the Middle East”. Still specialising in the retail and distribution of global brands within the sectors of fashion, beauty and gifts, the Dubai-based group boasts revenues of January 2014
”The Chalhoub Group was the first enterprise to enter the luxury market in the Middle East. We wanted to build a bridge between the Western culture of luxury and refinement in the Middle East.”
more than $1 billion, and continues its record growth, regardless of the financial rollercoaster of recent years. Patrick Chalhoub has been instrumental in steering the business and ensuring it evolved into the company it is today, taking brave risks along the way. In 1990, he played a key role in the relocation of the Chalhoub Group’s headquarters from Kuwait to Dubai following the Iraq invasion. He has been a resident of Dubai ever since, with his wife and two children. Holding two degrees, one in Economics
Retail
46
Patrick and Ingie Chalhoub with Mohammed Alabbar, the chairman of Dubai-based real estate company Emaar.
All the top designer brands are found at Level Shoe District.
downturn, sales at the Chalhoub Group were unsurprisingly dealt a severe blow. The steep slump that occurred in 2009 and 2010 was especially sharp, as sales had been growing at more than 20 per cent per annum. The full impact of the financial crisis resulted in a decline in profitability estimated at between 40 and 60 per cent. This is where Patrick Chalhoub’s formidable business acumen came into play and, unlike many afflicted concerns, he did not tighten the belt and snap shut the purse. On the contrary, he had the steely nerve to implement a five-year restructuring plan and invested more than $30 million across the entire organisation. It was another astute move and further The first anniversary of the Level Shoe District was celebrated in style.
demonstration of Patrick Chalhoub’s deep understanding of the region. This
and Finance and another in Political
redeployment of the many brands in the
almost prescient sensitivity is allied by an
Science, Patrick was quick to implement
company’s portfolio.
incisive understanding of the markets and the results can be seen in the sustained
some vital strategies. By creating a UAE regional distribution platform in the
For 34 years now, Patrick Chalhoub has
leadership in each of the Chalhoub Group’s
Jebel Ali Free Zone, he increased the
invested his prodigious energy into the
sectors and each sphere of activity.
number of partnerships with major
long-term success of the family business.
international groups such as Coty, Fendi,
As such, he continues to expand the group’s
business and of his adopted city Chalhoub
L’Oréal, Dior Parfums and Puig and
distribution, retail business, marketing and
says, “First of all Dubai is a very vibrant
also became a director of Christofle and
communications activities, and he remains
city and it has this ability to reinvent itself.
Bernardaud. He was also at the helm for
undaunted by the challenges that arise.
It can adapt perhaps much quicker than
the strategic planning, restructuring and
In the recent aftermath of the global
Commenting on the recovery of his
many Western cities. So yes, we had a real Portfolio
47
that one category goes down and another one goes up. Take the beauty category… fragrances in the 70s and 80s were huge and everybody was crazy about them, but now it’s at cruise speed. Still progressing, but cruising. Then you have the era of the handbags, which was incredible. Shoes have always been a good category, but now that bags have reached a plateau, the attention of women is going into other accessories and shoes is one of them.” Patrick comments on the trend from both a regional and global context. After all, brand building and understanding the market specificities and consumer preferences is at the heart of his business. He continues, explaining that, “In our part of the world, shoes are a very important Level Shoe District is 96,000 square feet of impeccably designed space.
accessory because a lot of local women dress in a traditional way, so what we see is
estate issue and there was a financial issue,
feet, is essentially a shoe heaven. There are
mainly the bag and really the shoes, so it is
but there has been immediate action and
more brands and more shoes on sale here
an important expression. On a worldwide
reaction towards it in order to see where
than any comparable retail space anywhere
scale it’s a category that is really driving
the weaknesses were. We acknowledged
in the world. In the internationally
forward and I think there is a lot more
there were things that were overexposed
renowned hands of Lee Lapthorne,
expression. And a lot more designers are
and oversaturated, and so we try to fix
founder of Doll – one of the UK’s leading
coming into the category.”
those elements.” He has an undaunted and
event companies – a multi-faceted show
positive air around him, and despite the
featuring a team of dancers from London’s
of Beyoncé arrives to DJ, and the many
responsibility on his shoulders, he seems to
West End are due to arrive and entertain
international performers prepare for the
be constantly smiling.
an audience of tens of thousands.
big event set in this unique space featuring
There is good reason for Patrick’s
Before the grand event commences,
As Solange Knowles, younger sister
the world’s finest shoes, it’s clear that
buoyant mood as he is celebrating the
I ask Patrick about the significance of
both the Chalhoub Group and Dubai are
first anniversary of the Level Shoe District
the booming shoe sector. “In product
booming once more.
in the Dubai Mall. This vast footwear
categories growth moves from one
emporium, covering some 96,000 square
category to another, but it doesn’t mean
Christofle was the first luxury brand represented by the Chalhoub Group.
As a final word on how this bounce back happened, Chalhoub says, “People don’t speak much about it, but you go back to basics. Back to real estate and using it as an enabler not as an engine of growth. You put things into perspective and go back to basics with trade and tourism. After 2010, Dubai really questioned where it went wrong and went back to basics, and guess what? It helped a lot. Now we build on the strength of the country. And it’s true that Dubai is coming back strongly, and perhaps the crisis reminds people to remain humble and not to just say
AFP/GRAPHEAST
‘we are the best in the world and we can do anything’. So I hope we retain some humility now that the crisis is behind us.” n January 2014
geTTY images
48
Portfolio
Manufacturing
49
A Pencil Powerhouse Faber-Castell, the world’s largest maker of wood-encased pencils, is an example of how German midsize companies stay competitive in the global marketplace, reports Jack Ewing.
Count Anton-WolfgAng von
also makes a broad range of pens, crayons,
the count asked during an interview at
Faber-Castell has been known to hurl
and art and drawing supplies, as well as
the family castle near the factory. “Two
wooden pencils from the tower of his
accessories like erasers and sharpeners.
reasons: One, to really make the best here
castle to the stone courtyard below. It is
About half the company’s German
in Germany and to keep the know-how
not a petty fit of pique by a mad Bavarian
production is exported, mostly to other
in Germany. I don’t like to give the know-
aristocrat. The 72-year-old count, the
countries in the Eurozone. That means that
how for my best pencils away to China,
eighth in a long line of pencil makers, just
Faber-Castell contributes, at least in a small
for example. Second, ‘Made in Germany’
wants to prove the durability of the pencils
way, to Germany’s large and controversial
still is important.”
that carry his family name.
trade surplus – which now rivals China’s for
© 2013 New York Times News service
The Faber-Castell family has been
the world’s largest.
Not all its factories are in Germany. But when Faber-Castell, which is privately held
making wooden pencils by the hundreds
Faber-Castell illustrates how midsize
and had sales of ¤590 million (about $800
of millions in Stein in a storybook setting,
companies – which account for about 60
million) in its last fiscal year, manufactures
bisected by the swift Rednitz River, which
per cent of the country’s jobs – are able to
in places like Indonesia and Brazil it does
was once the main source of power. A
stay competitive in the global marketplace.
so at its own factories.
torrent of brightly coloured pencils flows
It has focused on design and engineering,
from clattering machines in a century-
developed a knack for turning everyday
companies, like Apple, that have
old factory with a tile roof and windows
products into luxury goods, and stuck to a
outsourced nearly all production to
framed in pastel hues.
conviction that it still makes sense to keep
Asia, Faber-Castell and many other
some production in Germany.
German companies make a point of
Faber-Castell is the largest maker of wood-encased pencils in the world and
January 2014
“Why do we manufacture in Germany?”
In contrast to many American
keeping a critical mass of manufacturing
getty imAges
Manufacturing
50
Workers assemble mechanical pencils and trays at the Faber-Castell factory in Guangzhou, China.
in Germany. They see it as central to
There are threats everywhere, including
were down nine per cent, because of the
preserving the link between design,
ever-more-sophisticated Chinese
depreciation of currencies in markets like
engineering and the factory floor.
competitors, the stagnant Eurozone
Brazil and weak sales in southern Europe.
The result is a large trade surplus. During
economy and unpredictable shifts in
the first nine months of 2013, Germany
technology. And when even preschool
Still, Faber-CaStell, founded in
exported goods and services worth ¤148
children know how to operate iPads, there is
1761 when graphite pencils were a novelty,
billion more than it imported – including a
no certainty of a future for coloured pencils
has overcome technological shifts before.
surplus of ¤20 billion in September alone.
and ink markers.
When Count Anton took over the business
In absolute terms, it was the largest monthly
“The biggest challenge for Faber-Castell
in 1978, after the death of his father, Count
will be how writing will develop with the
Roland von Faber-Castell, the company
advent of digital technology,” said Hermann
was a leading maker of slide rules. That
it has drawn criticism from the United
Simon, a management consultant who
was soon laid to waste by the electronic
States. The European Commission is
coined the term “hidden champions”
calculator. Then, in the 1980s, the advent of
conducting an extensive review of whether
to describe the highly focused, midsize
computer-assisted design soon gutted the
it is unhealthy for the Eurozone economy.
companies like Faber-Castell that drive the
market for its mechanical drawing products.
Critics say Germany should invest more
German economy. “Will children still write?
of the profits from exports at home,
But Faber-Castell recognises this challenge.”
trade surplus on record. Germany’s trade surplus is so huge that
to stimulate its own economy and, by extension, the rest of the Eurozone.
With help from the Boston Consulting Group and the company’s in-house
Certainly, the market is testing Faber-
designers, the count revamped the product
Castell. While sales in the last fiscal year
line to put more emphasis on higher-priced
rose 3.5 per cent, profit declined 27 per
products, ranging from coloured pencils for
more concerned about their ability to
cent, to ¤24.2 million, in part because of
artists to fountain pens selling for thousands
stay globally competitive, leaving the
the cost of building new operations in Asia
of dollars. Premium products account for
macroeconomics of trade to the bureaucrats
and Latin America. The company said in
about 10 per cent of sales.
of Brussels and Berlin.
November that sales so far this fiscal year
But companies like Faber-Castell are
“You have to continuously shift,” said Portfolio
can easily cost hundreds of dollars. It is this focus on the premium end of the market that has enabled German companies to survive in markets flooded by low-cost Asian alternatives. Mercedes and Audi cars are good examples of this, but German companies have also achieved similar success with more mundane products like Rösle kitchen implements, Steiff stuffed animals and Falke socks. “The higher end of the market still cares about and is still ready and willing to pay a premium for good-quality products,” said Daniel Berch, a director at the market An employee at Faber-Castell straightens pencils in Stein, Germany.
research firm Pell Research who has studied the pencil industry in the United States. Count Anton, while aware of the digital threat, maintains that writing by hand will never disappear. People still use pens,
When Count Anton took over the business in 1978, after the death of his father, Count Roland von Faber-Castell, the company was a leading maker of slide rules.
Count Anton-Wolfgang von Faber-Castell is the eighth in a long line of pencil makers.
Count Anton, who on this day wore a
into the world’s dominant pencil maker.
pencils and highlighters for personal notes
double-breasted pinstriped suit with red tie
Later generations intermarried with the
and to mark up printed documents, he
and white pocket handkerchief. “If you lean
aristocratic Castell clan, creating the Faber-
argues. And even in wealthy countries, he
back and say, ‘With my products I can be
Castell name. (Eberhard Faber pencils,
says, children use pencils and pens to learn
happy,’ then it’s the first step to hell.”
recognised by generations of American
how to develop the motor skills needed to
The count’s pedigree sets him apart
schoolchildren, were made by Lothar’s
read and write.
from the typical factory bosses. But being
younger brother, who first set up shop
an aristocrat in Germany no longer means
in Brooklyn.)
much, at least not officially. The nobility lost
And yet, being a count still counts for
“The pencil is in some way a very archaic product but still indispensable,” he said. “The pencil will remain alive much longer
its privileges after World War I, and most
something. The company’s luxury products
of Germany’s remaining princes and barons
are called the Graf von Faber-Castell line
have to work for a living.
– “graf ” being German for “count.” The
generation, Count Anton’s 33-year-old son,
than we probably believe.” To make sure that remains true in the next
company recently unveiled a Graf von
Count Charles von Faber-Castell, a graduate
Faber, a carpenter’s apprentice. His great-
Faber-Castell fountain pen made of jasper,
of Columbia Business School, recently joined
grandson Lothar Faber was given noble
quartz and gold. It sells for almost $10,000.
the Faber-Castell marketing department.
Faber-Castell was founded by Kasper
status in 1861 by King Maximilian II
Even boxes of the highest-quality Faber-
of Bavaria after building the company
Castell coloured pencils and artists’ markers
January 2014
“First,” Count Anton said sternly, “he has to learn the business.” n
Manufacturing
51
52
Money in Trash
AFP/GrAPHeAsT
Taiwan used to have huge problems with trash, but now it recycles on an industrial scale, reports Cain Nunns.
Electronic waste awaits its turn to be recycled. Portfolio
Recycling
53
Forty kilometres west oF Taipei on Taiwan’s rugged northwest coast, a cavernous warehouse under construction represents the new priorities for an island where the streets were once littered with piles of discarded electronics and other refuse. At the clean and tidy construction site, building materials are stacked neatly and even workers’ cigarette butts are carefully collected. The surroundings are designed to evoke a Roman villa, with lagoon, garden and canopies. The energy-saving shade tiles are made out of old CDs, DVDs and computer motherboards. It is the latest expansion effort in a vast glass, plastics, paper and just about anything than can be reused or mined for
Electronics are mined for precious metals such as gold and silver.
materials. When the warehouse project is complete, Super Dragon Technology, one of the island’s biggest recyclers, will be able to securely store up to 150 kilograms of gold and other precious metals. Trash is valuable here – the byproduct of a world now dependent on technology. Taiwan, which is home to a host of technology companies like Asus, Acer and HTC, produces more electronics per capita than any other country. “Recycling became huge because of the electronics firms,” said Chen Wei-Hsian, the secretary general of the Formosa
When the warehouse project is complete, Super Dragon Technology, one of the island’s biggest recyclers, will be able to securely store up to 150 kilograms of gold and other precious metals.
cent last year, amounting to roughly 14 million tons. The industry was born out of necessity. In the boom days of the 1980s and 1990s, factories in Taiwan made products as varied as plastic umbrellas and high-tech electronics for the rest of the world. As production soared, the land-poor island of 23 million people began running out of places to dump its waste. Mountains of fetid household waste rotted in the streets. Public and disused spaces became dumping
Association of Resource Recycling, an
grounds for some of the toxic waste
industry organisation. “That’s why it’s
from the industrial boom.
grown from about 100 recycling outfits
cent,” said Ding, adding that the company
to over 2,000.”
could apply to the London Bullion Market
At the time, infrastructure to tackle
Association, a trade organisation focused
the problem barely existed. Large-scale,
of 65.8 billion Taiwan dollars ($2.2
on the gold and silver market. “We have
commercial waste-processing facilities
billion) according to the Industrial
some great inventory.”
were scant. Few households recycled.
In 2012, waste companies had revenue
Development Bureau at the Ministry of
© 2013 New York Times News service
the country’s total – was about 80 per
The commercial efforts, along with
And pulling valuable materials from
Economic Affairs. That is up from 24.9
a government fund and increased
scrapped technology was dangerous. Wu
billion Taiwan dollars a decade earlier.
consumer awareness, have helped clean
Yao-hsun, the chairman of Super Dragon
up the country. Taiwan has one of the
Technology, says he believes he got cancer
Super Dragon is even considering a new
highest household recycling rates in the
from the toxic processes used to extract
venture, according to Ding Guo-tsuen, the
world, roughly 42 per cent, up from five
gold, silver and other precious metals
company’s chief technical officer.
per cent in 1998, according to Taiwan’s
from the country’s discarded electronics.
With gold accumulating in its vaults,
“We are thinking about changing to a
Environmental Protection Administration.
“In the old days, nobody knew the
precious metals trading business, because
The development bureau estimates that
dangers. They just knew there was
we can make pure gold at about 99.99 per
the rate for industrial waste – the bulk of
money inside,” said Wu, who is now
January 2014
AFP/GrAPHeAsT
industrial park that recycles electronics,
Recycling
54
The government also started the Taoyuan Environmental Science and Technology Park, the industrial complex where Super Dragon is building its third warehouse. based in Taipei. “The government had to do something.” In 1998, the government set up a fund to encourage recycling and reduce Arthur Huang, left, founder of Miniwiz Sustainable Energy Development, shows parts of the shading system to be used on the newest Super Technology Dragon recycling warehouse project.
waste. Producers and importers now pay a fee based on the cost of collecting and recycling 33 types of goods, such as glass, plastic, paper, aluminium containers, tires, batteries and electronics. With the money, Taiwan’s environmental agency then issues rebates to recycling companies. “We spend about six billion dollars each year on subsidies to the recycling companies, which pay collectors, who then pay the residents. But it’s the incentives and the public educational programmes that are key for our success,” said Lee Shou-chien of the Environmental Protection Administration’s Recycling Fund Management Board. He added that for many people, recycling had become “a daily habit they are accustomed to.”
REUTERS
The government also started the Taoyuan Environmental Science and Eighty per cent of Taiwan’s industrial waste is recycled.
Technology Park, the industrial complex where Super Dragon is building its third
cancer-free. “The environmental problems
the island’s first free presidential elections,
warehouse. The park offers incentives for
were also huge. But the research and
demanded higher standards of living
recyclers of glass, plastic and electronics
infrastructure were lacking. We had to
from a government that had focused on
that use advanced technologies and invest
modify our own machinery.”
economic growth at any cost.
in research and development to increase the island’s reuse rates.
With trash and toxic materials
“You are literally selling trash to people,
accumulating, public anger simmered
“There were mountains of trash
over how local governments should deal
on the streets,” said Yeh Chun-hsien, the
so you have to think, who would do
with the problem. At the same time, a
president of the Chung Tai Resource
that without a clear efficiency benefit?”
growing army of social activists, buoyed by
Technology Corp, a recycling company
said Arthur Huang, founder of Miniwiz Portfolio
ROGER FEDERER ARTIST Enjoy responsibly – www.moet.com
Recycling
56
The newest Super Technology Dragon recycling warehouse project is built out of many recycled and sustainable items.
Sustainable Energy Development, which designed Super Dragon’s facility. Miniwiz, based in Taipei, is an
Manufacturers have also come to realise the value in their trash. Companies like Chung Tai, one of the island’s largest light
architecture and product design firm
manufacturers, uses its own industrial waste
that turns trash, including electronic
as raw materials for new products. Others
waste, into products like cellphone cases,
are selling their valuable waste to recyclers.
wine bottle holders and fire-resistant construction materials. Over the years, the industry, once
“The electronics companies have a better idea about precious metals in their waste,” Ding of Super Dragon said. “When
largely made up of small and dangerous
the gold price jumped to $1,800 to $1,900
backyard operations, has developed its own
an ounce, they got savvier about what they
high-tech expertise. Chung Tai Resource
were throwing away. They used to pay us
Technology, which recycles glass and
to pick up their refuse – now we pay them
highly toxic chemicals like phosphorus and
to collect it.”
mercury, relied on European machinery when it opened in 2001. Yeh said the company had since refined
The advances have spread beyond technology waste. At the W hotel in the Xinyi District of
Over the years, the industry, once largely made up of small and dangerous backyard operations, has developed its own high-tech expertise.
holders for use throughout the property. “Sustainability in our business is somewhat of an oxymoron,” said Cary
the equipment to improve the process,
Taipei, staff members wanted a solution
Gray, the general manager at the W
developing a system to turn 95 per cent
for disposal of the 300,000 plastic water
Taipei. “But it makes perfect sense to use
of the mercury and other waste from
bottles the hospitality business churns
it as a way to engage our community.
lighting products into raw materials.
through each year. Working with a group
There’s a level of education, awareness
Super Dragon has developed a processing
of local designers who had been awarded
and social responsibility in this city, and
technology that semiconductor makers
grants from the Taipei city government,
the government is highly supportive of
use to spray super thin films onto their
the hotel is having the bottles turned into
creative industries. People have embraced
silicon wafers.
coasters, games, and key- and change-
this culture.” n Portfolio
exclusive to duty free
58
Germany’s BiG repair Bill Europe’s largest economy is preaching austerity but its aging infrastructure is in dire need of an annual ¤7.2 billion investment, report Suzanne Daley and Alison Smale. Portfolio
W
hen inspectors decided
tracks, waterways and the like – is aging
behind. If we don’t spend, then the next
a few months ago
in a way that experts say could undermine
factories will not be built here.”
that the aging bridge
its economic growth for years to come.
over the Kiel Canal in
An earlier report by the German Institute for Economic Research was even
northern Germany was too weak for heavy
its neighbours, Germany itself has kept
harsher in its assessment, saying that
truck traffic, Holger Dechant, hired to
a tight rein on spending at home. Now
other EU countries were doing far more to
deliver giant wind turbines to the other
critics abroad, including the European
ensure their futures. “It is high time that
side, was at a loss.
Union and the United States, are pressing
Germany handles its lack of investment,”
He did eventually come up with an
it to do more to stimulate its economy,
the report said.
alternative route. But it is telling of the
and Chancellor Angela Merkel’s likely
sorry state of some of Germany’s roads
partners in a new coalition government,
come from, especially given the aversion
and bridges: His company is driving the
the left-leaning Social Democrats, are
of Merkel’s conservatives to higher
turbines to a ferry, shipping them north
seeking more money for a variety of
taxes. The $270 million budget surplus
to Denmark and then driving them south
domestic programmes.
projected for next year, even if given
again back into Germany.
A good place to start ploughing money
It is not clear where the money might
over entirely to roads and bridges, would
into, many experts say, is the nation’s
not be nearly enough to match what
said recently, explaining the nearly
physical underpinnings. A government-
the government commission said was
300-kilometre detour in his office. “We
appointed commission recently concluded
needed, and there are many other issues
just haven’t invested enough. Now there is
that it needed to spend ¤7.2 billion a
competing for funding. One solution may
trouble because there is no easy button to
year ($9.7 billion) for the next 15 years –
be a highway toll. Merkel’s conservative
fix it all.”
roughly 70 per cent more than it spends
partners in Bavaria are insisting on
“That’s how bad it is,” Dechant
now – to get existing infrastructure back
such a tax, which could be paired with
superfast autobahns, efficient industry
into shape. Others say that even more
reductions on existing taxes on domestic
and ability to rally public resources
is needed for schools, for instance, and
drivers and businesses but affect millions
for big projects, like integration with
for extending fibre optic cables to less
of foreign citizens and businesses
the former East Germany. But more
populated areas.
traversing Germany.
Germany was once known for its © 2013 New York Times News service
As it has been preaching austerity to
recently, it has been forced to confront
“If we don’t spend,” said Kurt Bodewig,
Some critics worry that, even if
a somewhat uncharacteristic problem:
who heads the government commission,
additional money starts flowing in soon,
Its infrastructure – roads, bridges, train
“then I think that Germany will fall
it may not come in time to avoid major
January 2014
Infrastructure
59
Infrastructure
60
problems, which are beginning to surface.
blocked with traffic. Crowded trains
but also with the government’s lack
A year ago, inspectors found tears in the
are often late. Last summer, a stretch
of investment in schools and day care
steel supports under a major highway
of aging concrete highway in the south
centres and its failure to create incentives
bridge outside Cologne, Germany’s fourth-
buckled in the heat, killing a motorcyclist
for private investment in energy and
largest city. Officials quickly restricted
and injuring four people. There are still
telecommunications sectors.
traffic and banned heavy trucks, forcing
track switches in Germany that must be
detours to four other bridges around the
operated manually. Its busy waterway
in establishing a high-speed fibre optic
city that, officials now say, will need $202
systems depend on antiquated locks and
network, for instance, and is now behind
million worth of repairs. The detours
lifts that have been around more than
countries such as Bulgaria, Lithuania and
were costly to local businesses and backed
a century, making them susceptible to
Romania. Officials in small towns in the
traffic up for kilometres each day.
breakdowns and generally too small for
rural north have grown so tired of waiting
modern boats.
for a plan that they have started on their
Almost immediately, companies in the area began pressing the Federation of
Germany went on a building spree
Germany, experts say, has been slow
own to get fibre optic cables laid down,
German Industry to do something. The
when the East and the West were
with residents coughing up ¤1,000 (more
business association, which is pushing
reunited in 1990. Most of the spending
than $1,300) each.
for spending at least an additional $5.4
was directed to the East, which was in
billion a year on maintenance, has
dire need of modernisation. The problem,
instance, that wanted to move to
calculated that the partial closing of that
experts say, is that the West got short
another community where the internet
bridge cost local industry ¤60 million to
shrift, even as many former East Germans
is better,” said Holger Jensen, the mayor
¤80 million (about $80 million to $110
moved West looking for jobs. In a short
of Lowenstedt, a village of 650 near the
million) during a three-month period.
period of time, roads and bridges in the
Danish border. “We realised something
West began taking a pounding they
had to happen quickly.”
“We have a steel company, for
Although the issues are certainly on
Regional officials worry that the
were never built for. The bridge with the
area’s aging infrastructure will prompt
tear near Cologne was built for 35,000
the table in the talks on a new coalition
industries to move elsewhere or make
cars a day but now handles 120,000,
government, not everyone is convinced
their products less cost-competitive.
officials said.
that serious changes will be forthcoming.
Dechant, for instance, said the route
In its report, the German Institute took
“It’s all a question of money,” Groschek
through Denmark had cost 50 per cent
issue not only with a lack of maintenance
said. “Without it, all these reports are just
more than a delivery over the Kiel bridge.
for roads, bridges, trains and waterways,
a Christmas list.” n
“It can take 20 years to build a new bridge,” said Michael Groschek, the transport minister for North-Rhine Westphalia, the state that encompasses Cologne and includes dozens of bridges built 50 or 60 years ago, when average truck loads were lighter. “And we don’t know whether the current bridges can last that long.” From 1991 to 2012, Germany reduced its budget for maintenance by 20 per cent, according to Gernot Sieg, a transportation expert and professor at the University of Münster. It now spends 1.5 per cent of its gross domestic product on maintenance, compared with a European average of 2.5 per cent. About 46 per cent of Germany’s bridges, 41 per cent of its streets and 20 per cent of its highways need repair, Sieg said. Roads around major cities are routinely
Traffic near a road construction site on the A1 highway near Cologne, Germany. Portfolio
Essentials
63
THE BEST OF LEISURE AND LIFESTYLE
ART AND SOUL
A view across the River Limmat towards Grossm端nster church. January 2014
GETTY IMAGES
Zurich is often considered a staid city, but an exploration of its design and architecture reveals an anti-establishment attitude and quirky pleasures, reports Brian Johnston.
Essentials
64
Travel
medieval church of the Fraumünster is
designed in bronze and redwood by
adorned with stunning modern stained-
Swiss Modernist great Robert
glass designed by Chagall when he was
Haussmann, and you begin to realise
in his eighties: the glorious ruby and
how unpredictable this city can be.
turquoise glow proves the artist had
It’s true that, on the surface, central
lost none of his dazzling talent in old
Zurich springs few such surprises. Deeply
age. You can also sit beneath sketches
influenced by the puritan mindset of the
by Chagall and Miró at Kronenhalle
Reformation, Zurich’s medieval town centre
restaurant, where posh diners come for
is cool and simple almost to the point of
Zurich specialities such as veal in cream
plainness – though at times the severity
sauce. Stop by Kronenhalle’s eccentric bar,
seems almost modern. The interior of the
MBLE DOWN ZURICH’S MOST famous street and you get a lesson in Swiss understatement. The facades of some of the world’s leading private banks look like modest nineteenth-century townhouses, while shopfronts that display platinum watches and Fabergé antiques shimmer discreetly behind rows of plane trees. Even trams swoosh past with barely a noise. Wealth whispers on the Bahnhofstrasse, the main drag of a city that generates a fifth of Switzerland’s GDP. But beyond this cool exterior and the old-town core that forms most visitors’ impressions of Zurich, another side of this Jekyll-andHyde city is presented. Welcome to an alternative Zurich, where liberal thinking clashes with bourgeois values, and antiestablishment artists and architects have long challenged Swiss norms. An exploration of Zurich’s more subversive personality should start in its art museums which, for such a small city, are impressive. Head to the Kunsthaus for art that includes works by the Dada school, founded in Zurich in 1916. Precursors of surrealism, the Dadaist once outraged Zurich society: no Swiss decorum here. Then linger in the room devoted to local artist J.H. Füssli, where dark, grotesque canvasses provide a
PHOTOS: SWITZERLAND TOURISM
compelling glimpse into Zurich’s alter ego. Curiously, while industrialists and bankers in this town have always made money, revolutionary artists and thinkers such as Carl Jung, James Joyce, Thomas Mann and Marc Chagall (all of whom lived and worked here), made history. The
Strolling outside the Kunsthaus. Portfolio
65
BRIAN JOHNSTON
Inside the Kunsthaus.
Stained glass by Chagall in the Fraumünster.
and had soon converted Zurich into the first Protestant state outside Germany,
Bank, shopping and commerce take over. Strolling the city’s quays is one of the
transforming its look to today’s unadorned
best ways to spend a sunny afternoon,
puritan chic.
surrounded by a madness of marigolds or a
A statue of Zwingli below the cathedral
riot of roses. The Limmatquai is right in the
by the river is surprisingly swashbuckling.
city centre, starting off near the train station
cathedral (the Grossmünster, affectionately
Green with age, it shows a rather
and heading past the
known to English-speaking expats as the
Arthurian figure gracefully draped in
cream-cake facade of
Gross Monster) is almost stripped bare
robes, a sword plunged into the ground
the Town Hall along
thanks to the zealous sixteenth-century
between his feet. From here you get
the Limmat River.
Protestant reformer Ulrich Zwingli. It may
another contrast: that of the plain old
Myhtenquai takes
well be one of the world’s ugliest cathedrals,
town with a sumptuous sweep of blue
you right out along
although its bulbous twin towers are a
lake and sugary mountains like a baroque
the western
Zurich landmark. However, this austerity
fresco on the horizon. And while history
shores of the
was avant-garde in its day. Zwingli was
congregates on the eastern Right Bank of
lake and
in fact resolutely anti-establishment,
the Limmat River, over on the western Left
into the
Heidi Weber House, the last building design by Le Corbusier. January 2014
Statue of Zwingli
Essentials
Travel
ZURICH TOURISM ZURICH TOURISM
66
Inside the Haus Konstruktiv.
The façade of the Museum Rietberg.
wooded countryside, while Utoquai heads
Constructivist art that had a particularly
and architecture, there are plenty of ways
along the lakefront past promenades lined
strong following in Switzerland, if nothing
to appreciate the quirky side of Zurich.
with purple and yellow pansies. Along here
else just to see the dining room by Fritz
These days the city has been called the
you’ll find the last building ever designed
Glarner, which has become part of the
‘New Berlin’ for its heady mix
by another revolutionary Swiss, the
artwork that covers walls and ceiling, as
of experimental creativity, trendy bars,
internationally-influential twentieth-century
if you’re sitting inside a pop-up Mondrian.
ultra-chic restaurants and refreshing
architect Le Corbusier, which is nothing
Another must-see is the Museum
urban ideas. Want to ride a free bike
short of a poem in steel, glass and coloured
of Design building, a manifesto for
around town? Please go ahead. Care to
enamel plates.
Functionalism. More recently, an addition
have a moment’s rest on a public bench
in 2007 to the Rietberg Museum – which
in the shape of a cow, a bathtub or
was gaining a reputation for bankers and
displays Asian and African art – added
something so abstract it takes moments
clockwork organisation, so too were its
another striking façade to the Zurich
to work out where to place your behind?
architects apparently ignoring established
landscape in a series of green glass panels
Why not. Then listen to avant-garde
wisdom and running wild. Head to
nicknamed the Emerald.
music in pubs, or original-language
Throughout the last century, as Zurich
the Haus Konstruktiv, devoted to the
Even if you don’t particularly enjoy art
movies in art-house cinemas. Something
A street café at the Theater am Hechtplatz. Portfolio
67
The Vierter Akt, one of the many informal restaurants in Zurich West.
The Schiffbau building in Zurich West.
has happened to the nightlife in Zurich
Portuguese eateries and shops selling
restaurants, and art galleries display
too over the last decade or so – it’s now
African beads. The once declining inner-
contents that defy description. The
the best in Switzerland. The streets of the
city industrial area has become one of the
Schiffbau, once a shipbuilding factory, is
Niederodorf district are crowded with
hippest, hottest parts in town and, for
now a complex containing restaurants,
clubbers and bar hoppers who keep going
those seeking interesting design, is now
bars and a jazz club, topped by a dramatic
until the early hours of the morning, at
the place to go shopping. The flagship
glass tower from which there are views
least in summer.
store – or rather shipping container –
all the way to the Alps. The onetime
of hip Zurich brothers Freitag is here,
Löwenbräu Brewery is now an art centre.
ongoing changes in Zurich West. You
stocked with the latest in bags made from
Minimalist boutique hotels have sprung
reach this area by leaving the top end of
recycled truck tarpaulins. On Josefstrasse,
up, and chic designer eateries have
the Bahnhofstrasse and heading through
Swiss brand Erfolg offers rather outré
become the place to meet for Zurich’s
the train station to what was once, quite
handbags and T-shirts, while Einzigart
media and arty types.
literally, the wrong side of the tracks.
stocks chairs, lights and other furnishings
Working-class, multi-ethnic Zurich West
by local designers.
You could also simply check out the
has streets lined not by Cartier and Rolex stores but Italian barbershops, informal
Elsewhere, former factories have been transformed into nightclubs and
Giessereihalle on Turbine Square in Zurich West. January 2014
That is all the evidence you need that Zurich has an edgy appeal if you look beyond the neat facades of its politely proper Bahnhofstrasse. n
Essentials
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Cuisine
ALL CHEESE GREAT AND SMALL The picturesque towns and villages of the Yorkshire Dales are home to some incredible artisan cheesemakers, reports Andrew Marshall.
I
T’S EARLY SPRING IN THE
against green, that march up impossibly
television series All Creatures Great and
Yorkshire Dales, a region of timeless
steep slopes until they disappear into the
Small about the trials and tribulations of
beauty symbolised by the limestone
heather-cloaked moorland on the summits.
vet James Herriot (based on the books
walls that climb its brooding hills – endlessly varying patterns of grey
Many people will be familiar with the Dales as the backdrop for the popular
written by Alf Wight), but they are equally famous as a walking destination, with hundreds of miles of scenic footpaths. But there’s more to the area than scenic hiking and the adventures of a vet; for centuries people have been baking breads, brewing beers and churning cheese in the Dales. It’s thought that the origins of cheesemaking lie with Cistercian monks who arrived from Normandy and settled in the local abbeys in the 11th century, and they in turn passed on their techniques to the farmers of Swaledale and Wensleydale. Today, the tradition of cheesemaking continues, and in recent years there’s been a resurgence of interest in handcrafted cheese. From larger producers such as the Wensleydale Creamery in Hawes to smaller artisan producers like Laceys in Richmond, the good news for gourmet travellers is that there’s ample opportunity to learn about, taste and purchase cheese close to the source. SWALEDALE Perched high above the River Swale with its Norman castle etched against the sky is the historic town of Richmond – the starting scene for my cheese foray in the Dales.
PHOTOGRAPHY BY ANDREW MARSHALL
Swaledale cheese has been made in the dale that bears its name for centuries. Rows of cloth-bound cheese inside the ageing room at The Swaledale Cheese Company.
Originally made with Swaledale sheep or goat’s milk, it wasn’t until the 17th century that the cheese was made from cow’s milk. The farmers would make cheese to preserve the excess milk after calving time; Portfolio
69
Wensleydale
Swaledale Ribblesdale
The atmospheric town of Richmond in Swaledale is one of the main towns in cheesemaking country.
some would be kept to feed the family and some would be bartered with grocers and corn merchants for food and flour. In the early 20th century, farmhouse cheesemaking went into a steady decline and by 1980, only Mr and Mrs Longstaff of Harkerside Farm above Reeth were still making traditional Swaledale cheese to a closely-guarded family recipe. Swaledale cheese was close to dying out until Mrs Longstaff, who had retired from cheesemaking, gave the original recipe to David
Sam and Louise Reed in playful mood inside the office at The Swaledale Cheese Company – one of Yorkshire’s finest artisan cheesemakers.
she helped them to re-establish authentic
a Super Gold for a Swaledale Blue at the
Swaledale cheese, through their launch
2011 World Cheese Awards.
of The Swaledale Cheese Company in February 1987.
Both David and Mandy Reed have sadly passed away, but the company is now
WENSLEYDALE CREAMERY
and Mandy Reed. Acting as chief taster,
The Swaledale Cheese Company has
being taken forward by their two children,
since gone from strength to strength and
22-year-old Sam and 26-year-old Louise,
now produces approximately 1.75 tons
who are both determined to continue
of Swaledale cheese per week, supplying
their parents’ passion for making some of
specialist cheese shops, delicatessens and
Yorkshire’s finest artisan cheese. “It has
from both cow and sheep’s milk, they
independent retailers. The company’s
been really tough since losing both our
have seen a marked increase recently in
success has been part of a vigorous fight
parents and we’ve had to grow up fast,”
sales of their goat’s milk cheese. “We sold
back by local cheese against ‘bland brand’
says Sam, when I meet the inspirational
more goat’s cheese last Christmas than
varieties and the company’s Swaledale
duo at their cheesemaking facility situated
blue cheese,” says Louise. “Goat’s cheese
recipe and methods are protected
on the outskirts of Richmond. “Back
is definitely in vogue and it’s perfect for
and accredited with PDO (Protected
when Mum and Dad started the business,
people who have an intolerance to sheep
Designation of Origin) status for both its
most people were only aware of Cheddar
or cow’s milk.”
Traditional Swaledale and Swaledale Ewe’s
cheese, but now there are so many types
Cheese. Over the years, its distinctive
available, and it’s the same with the
MY NEXT stop is Richmond’s restored
cheeses have won many prizes, including
growth of artisan cheesemakers.”
former railway station, which showcases
January 2014
Cutting and blocking the cheese in the Wensleydale Creamery, Hawes.
Although the company makes cheese
Essentials
Cuisine
Simon Lacey drains the whey from the curds inside Laceys Cheese, Richmond.
Rowleth End at Low Row, Upper Swaledale, is a great place to base yourself while exploring Yorkshire cheese country.
a range of local food producers where,
the old-fashioned cheesemonger to the
through the viewing window of his cheese-
road again, and people love the personal
the B6270 deeper into Swaledale, where
making workshop, I catch a glimpse
service,” says Simon. “I also do all the
the road gets narrower, the River Swale
of Simon Lacey standing beside a steel
farmers’ markets and food festivals from
wilder, sheep scarcer and the views more
tank draining the whey from the curds.
Richmond to Leyburn and beyond.”
spectacular towards the tiny settlement
Simon, 42, learned about cheesemaking
From Richmond I drive west along
of Low Row and my bed for the night.
He uses traditional production methods
while working for the Swaledale Cheese
to make mainly Wensleydale cheese in
“Welcome to Rowleth End Guest House
Company and fulfilled a life-long dream
different flavours such as pepper, olive,
in beautiful Upper Swaledale,” says the
when he opened Laceys in 2007.
chilli and even beer. “Small producers
owner Roger Tuckett, who offers me a
like myself may not be able to compete
welcome drink followed by a delicious meal
Simon does everything from supervising
with the supermarkets on their level, but
of fishcakes, pork in a prune sauce, bread-
milk arrivals to making, selling and
we can offer a different experience and a
and-butter pudding, and finally a cheese
delivering the cheese. “In a way, I’m taking
fantastic product,” he says.
platter showcasing products from all four
He is a one-man cheese operation and
creameries within a 15-mile radius. “I have the ‘Dales Cheese Grand Slam’,” says Roger with a grin, as we begin to sample the cheese paired with a glass of Yorkshire red wine. Roger tells me he is already excited about the Tour de France coming to these parts in July 2014 and literally going past his front door. “Yes, I’m already in the process of planning some kind of event with overnight camping to showcase the best in Yorkshire food and drink,” he says. SIMON STOTT
70
A flock of Friesland ewes that supply their milk to cheesemakers including Iona Hill at the Ribblesdale Cheese Company in Hawes.
WENSLEYDALE The following morning after a hearty breakfast I’m back on the scenic B6270 travelling through the quintessential Portfolio
Essentials Cuisine The attractive market town of Richmond.
Dale End Cheddar made by Alastair Pearson of Botton Creamery – a traditionally-made cloth bound cheddar aged for 18 months.
Swaledale villages of Gunnerside, Muker and Thwaite, then over the wild and lonely Buttertubs Pass into Hawes on the other side. The busy market town of Hawes, situated in the heart of Wensleydale’s finest scenery, is home to Yorkshire’s largest cheesemaker – the Wensleydale Creamery. Like its neighbour in
takes to organise a ploughman’s lunch of
interested in setting up their own artisan
Swaledale, Wensleydale cheese has a
crusty bread and a chunk of Wensleydale,
cheesemaking business, which is rather
heritage that spans centuries and the
I’m already across the other side of Hawes
exciting,” she says.
skilled cheesemakers at the Wensleydale
to meet a specialist in goat’s cheese.
Creamery continue the art of hand-
“Welcome to the smallest goat’s cheese
crafting Wensleydale cheese to a time-
producer in Yorkshire,” says Iona Hill of
honoured recipe, using milk from local
the Ribblesdale Cheese Company as she
farms. The result is a mild and creamy
proudly invites me to taste a newly-made
cheese, which has a fresh, clean flavour
batch of soft goat’s cheese. “It’s velvety,
with a honeyed aftertaste and a crumbly,
rich and creamy with lemon notes,” she
flaky texture. To see how it’s made, I
says. “It’s destined for Michelin-starred
head to the viewing gallery to watch
Vanilla Black in London, and also Fodder,
the cheesemakers performing the art of
an exclusive deli restaurant in Harrogate.”
cutting, stirring, pitching and salting,
Iona also runs a few cheesemaking
all done by hand. Before leaving, I pick
courses every month, including a one-day
up a sustaining slab of Yorkshire’s finest
course aimed at home cheesemakers and
from the adjoining shop – will it be Oak
a two-day one for people who are thinking
Smoked Yorkshire Wensleydale or Real
of setting up a commercial business,
Yorkshire Wensleydale & Cranberries?
covering aspects such as sourcing
From one great cheesemaker I next
equipment. “People come from all over to
head to a smaller one, and in the time it
attend my courses, and many of them are
January 2014
A Shepherd’s Purse favourite – Yorkshire Fettle – a soft crumbly ewe’s milk cheese with a sweet, piquant taste.
71
Essentials
Cuisine
Iona Hill, from the Ribblesdale Cheese Company in Hawes, with a Ribblesdale Superior Goat Cheese that won silver at the British Cheese Awards.
Ewe’s milk and goat’s milk cheese from The Swaledale Cheese Company.
RIBBLESDALE AND BEYOND From Hawes I hit the road again, driving south through wild Pennine Way country into Ribbledale and the quaint market town of Settle, which is home to the Courtyard Dairy, run by owner Andy
SHEPHERDS PURSE
72
Swincoe, a specialist cheese refiner and purveyor. His mantra is to sell the best of the UK and France. He champions
A selection of cheese from Shepherds Purse.
small, individual farmhouse cheese-
“Their maturing progress is tested using a
makers who still make it by hand with
cheese ‘iron’ and when deemed at its peak
unpasteurised milk from their own herds,
the Cheddar is released for sale, usually at
to get the best depth of flavour.
around 18-months.”
cheese available locally and in other parts
Once the cheese arrives at The
Andy is justifiably proud of The
Courtyard Dairy that’s only the start of
Courtyard Dairy, which only opened in
the story. The whole shop is specially
December 2012 yet was awarded “Best
equipped to age cheese, and Andy has a
New Cheese Retailer” at the prestigious
background of working for some of the
annual British Cheese Awards held
top cheesemongers in the country and a
in September 2013. The judges were
French apprenticeship in affinage (cheese
particularly impressed by the way The
ageing). So how is the cheese matured?
Courtyard Dairy showcases unique
produced were Olde York (a soft and young
farmhouse cheesemakers of Britain.
French-style cheese) and Yorkshire Feta,
To get to its best, each cheese has its own
Cloth-bound Richard III Wensleydale cheese made by cheesemaker Andy Ridley from Bedale, North Yorkshire.
special requirements, from the environment
On the fringes of the Yorkshire Dales, at
which is now called Yorkshire Fettle, made
it is kept in (different humidity, temperatures
Leachfield Grange near Thirsk, is Shepherds
to a feta recipe and adapted so it has higher
and materials it is stored on), to its day-
Purse, a family-run company that began
moisture content and less salt. In the early
to-day care such as turning, brushing and
specialising in cheese made from sheep milk
90s the family noticed that there wasn’t
washing. “For example, our Dale End
in the 1980s. “We originally bought a dozen
a lot of blue cheese available, so in 1994
Cheddars made by Alistair Pearson at
Friesland sheep, a breed that originated
they launched their signature cheese called
Botton near Whitby are matured on site in
in Holland, and started milking them by
Yorkshire Blue (made from cow milk),
a specific environment on traditional wood
hand,” says the director Katie Matten.
which is their biggest seller and is used by
boards with regular brushing,” says Andy.
The first cheese that Shepherd’s Purse
restaurants throughout the country. n Portfolio
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74
Essentials
Luxury
W
ALKING AROUND THE old city of Dresden it is impossible not to feel the
weight of history imbued in the stones and rooftops that tower overhead. There is an air of resilience embodied in the buildings and a sense of wonder at how much reconstruction has been achieved following the Allied bombing raids of WWII. Ninety per cent of the city centre was destroyed in 1945 but Dresden has been carefully and steadfastly rebuilt. There’s no building quite so impressive as the enormous Frauenkirche, or Church of Our Lady. Less than 10 years ago this was little more than a pile of rubble. Now this spectacular construction, with one of the largest domes in Europe, has been restored to its former glory. Whilst admiring the Frauenkirche I am suddenly struck by the correlations between the building and the watch brand A. Lange & Söhne that I have come to Germany to visit. Both had long and illustrious histories before the onset of war, and both ceased to exist as a result of it. A. Lange & Söhne was expropriated by the post-war Soviet administration in 1948, and the company that was founded by Ferdinand Lange in 1845 to produce high-quality pocket watches was no more. Not until 1990, after the reunification of Germany, did the founder’s great-
PRECISION AND ARTISTRY The watchmaker A. Lange & Söhne is the phoenix of the luxury watch industry. The brand disappeared in the 1940s but is now revered again following its resurrection in the 1990s, reports Nick Rice.
grandson, Walter Lange, lay plans to resurrect the A. Lange & Söhne brand. This was coincidentally the exact same time that an initiative was formed to reconstruct the Frauenkirche. Walter Lange’s dream of rebuilding the ancestral business was aided by respected watch industry figure Günter Blümlein and several Swiss watch manufacturers, including IWC and Jaeger Le Coultre. With this collective effort the re-founded A. Lange & Söhne, operating from just outside Dresden in its original home of Glashütte, presented its first range of wrist watches in 1994 – the same year that the foundation stone was laid in the Frauenkirche after Portfolio
75
foster a quiet and contented atmosphere.
changed literally everything. On my first
Absorbed in their tasks in the same way
day we had a manufactory tour and I was
in 2005 in time for Dresden’s 800th
a painter gets lost in creation, this key
introduced to the Board of Directors and
anniversary, by which time A. Lange &
ingredient of pride in the product explains
we had an employee gathering. And you
Söhne was well on the way to joining the
why the finished timepieces emit such an
look into the eyes of these people and
top ranks of the world’s finest watchmakers.
essence of quality.
you see the fire burning, and you know
several years of private fundraising. The church was eventually completed
the rest you can repair. The rest is not
To see where the A. Lange & Söhne history began I head to Glashütte to see the
FOR WILHEM Schmid, 49, the
difficult. It’s administration, common
original site and the nearby location for the
German CEO who came to the company
sense – but the foundation is these people
brand’s forthcoming substantial expansion.
in January 2011 from senior roles at
who would do everything for the brand.
BMW, the passion of A. Lange & Söhne’s
I’ve never seen people so… let me put it
even utilitarian, and the atmosphere
employees was an immediate sign that
this way, I don’t need brand ambassadors
throughout all the different departments I
he could do well at the helm. “I came
– I have 620 of them.”
visit is markedly calm. Whether engraving,
from South Africa to Germany, from
polishing or assembling a range of ultra
BMW to A. Lange & Söhne, from cars
technicians as I’m escorted through
complicated movements, the employees
to watches, and aside from my family I
the showroom and parts production
The manufactory is simple in design,
January 2014
I meet a handful of these dedicated
76
Essentials
Luxury
The meticulous construction of the Grand Complication involves 876 tiny components.
departments. Not only do I gain an
representative of their overarching
incisive overview of the entire painstaking
dedication to perfection. The movement is
process of creating an A. Lange & Söhne
completely taken apart again. Every single
timepiece, I also witness the passion that
component is cleaned in an ultrasonic
Schmid was so impressed by. Peering over
tank as a final measure to ensure that
the shoulders of the experts I see design
every part, many of which will be invisible
stages, milling, plate forming, deburring,
to the eye within the heart of the watch,
component creation, chamfering, perlage,
is flawlessly clean. At this stage the final
straight and circular graining, flat
surface decorations are executed and the
polishing and the execution of a sunray
characteristic thermally blued screws are
finish. Not to mention the mastery of
used to close the mechanism together.
the engraving department, where an
Now the dial and hands can be
engraver’s work can be identified years
mounted and the movement can be
after the creation of a watch, as they each
encased in platinum or pink, yellow
have a distinct signature style to their
or white gold. The final act sees the
work, much like a form of handwriting.
watch undergo a rigorous six-week
In the final stages of the production,
Wilhelm Schmid has been A Lange & Söhne’s CEO since 2011.
test programme to prove its functional
when the movement is ready to be
integrity and a strict visual inspection
encased in a precious metal case, A. Lange
before it is finally permitted to leave
& Söhne do something which is singularly
the manufactory.
Every single component is cleaned in an ultrasonic tank as a final measure to ensure that every part is flawlessly clean.
SCHMID HIMSELF was an admirer of A. Lange & Söhne long before he knew he would one day be running the company. Schmid saw a Lange 1815 model in a store window in 1994 and bought it there and then. “I was intrigued by the fact that a traditional German brand celebrated its comeback with four manufacture calibres all at once, at a time when in-house developed movements were an absolute rarity in the industry. My first Lange was this 1815, which I purchased shortly after its launch because of its clear design and
The headquarter of A Lange & Söhne is in Glasshütte, close to Dresden.
artisanal beauty,” he says. Portfolio
77
Each watch undergo a rigorous six-week test programme to prove its functional integrity.
An engraver’s work can be identified years after the creation of a watch, as they each have a distinct signature style. The Grand Complication is limited to just six pieces – each one taking a full year to create.
As part of the Richemont Group, which owns a number of luxury watch
Complication is limited to just six pieces –
repeater or something like that, but to
manufacturers, A. Lange & Söhne is one
each one taking one full year to create.
come up with the ultimate answer to ‘what
of the principal brands at the world’s most
Retailing at $2.47 million, the meticulous
prestigious annual watch fair, the Salon
construction of the Grand Complication
International de la Haute Horlogerie
involves 876 tiny components.
(SIHH) in Geneva. Alongside the usual
Despite the fact it was a true milestone
are they capable of?’ was special,” he adds. A. Lange & Söhne’s rise from the ashes of history has been remarkable. With a constantly expanding global presence the
outstanding new watch launches, referred
in the world of haute horlogerie, when
brand is set to continue going from strength
to as ‘novelties’, last year the brand
A. Lange & Söhne unveiled the Grand
to strength. “I believe that we stand for
played its trump card with the Grand
Complication they eschewed brash fanfare
true values, understated design and high-
Complication watch. A masterpiece of
in favour of Teutonic understatement.
performance, all embodied in a rich history.
watchmaking, this accomplishment
“One thing that I’m proud of is that all
But our demand is outstripping supply by
announced to the watch industry just how
the industry journalists didn’t know,
so much we have to be careful” Schmid
far A. Lange & Söhne has come in the
even those who are very close to us.”
concludes. “A South African once gave me
years since the relaunch.
Schmid says with a wry smile. “We caught
some advice, which was ‘stay vigilant.’ That’s
everybody by surprise. I think a lot of
what we do even in good times. We are
people assumed there would be a minute
optimistic, but we stay vigilant.” n
The result of seven years of intensive research and development, the Grand January 2014
Essentials
78
Technology
FujiFilm
Finds a niche The X series, which mimics old-style cameras but has a high-tech core, has helped keep Fujifilm in business, reports Eric Pfanner.
itself from a maker of 35-millimetre
photographers, Irwin Wong, who shoots
film into a provider of digital imaging
seen sales of low-end cameras suffer from
pictures for Japanese magazines, relies
technologies.
the rise of the smartphone, which has put
on digital single-lens reflex cameras for
These include a new line of digital
a basic point-and-shoot into every owner’s
the bulk of his work – “bulk” being the
cameras, the X series, that blend Fujifilm’s
pocket. Even sales of more expensive
operative word.
digital technology with retro aesthetics
DSLRs, a business dominated by Nikon
reminiscent of cameras from 60 or 70
and Canon, have started to weaken this
Wong said of his Nikon D800, which
years ago. At a time when sales of other
year. Analysts say a maturing of DSLR
weighs nearly one kilogram, and a whole
cameras are slumping, the X series is
technology, which makes upgrades less
lot more when used in combination with
selling briskly.
essential, may be to blame.
“It’s a beastly camera to carry around,”
a selection of interchangeable lenses. “You
“Fujifilm once looked a lot like Kodak,”
can’t replace a DSLR for work. But it’s just
said Christopher Chute, an analyst at
not that much fun.”
International Data in Boston. “Based on
To lighten his load, and to inject a bit of levity into his photography, Wong this year bought a new camera, the Fujifilm
© 2013 New York Times News service
Like other camera makers, Fujifilm has
Like many professionaL
some different decisions, they have gone in very different directions.” Fujifilm still makes film, but it now
X-E1, to supplement his Nikon. He liked
accounts for less than one per cent of
that one so much that he added another
the company’s sales. The entire imaging
Fujifilm model, the X100S.
solutions division, which includes the
He is not the only member of the
company’s cameras, generates a mere 13
unofficial Fujifilm fan club. Over the
per cent of revenue. Most revenue comes
last decade, as rival Eastman Kodak
from businesses like pharmaceuticals,
was descending toward bankruptcy –
medical equipment and office machines,
it recently emerged from Chapter 11
in which Fujifilm has a partnership
proceedings – Fujifilm was transforming
with Xerox.
Fujifilm still makes film, but it now accounts for less than one per cent of the company’s sales. The entire imaging solutions division, which includes the company’s cameras, generates a mere 13 per cent of revenue. Portfolio
79
Masazumi Imai, designer of Fujifilm’s X series, shows various prototype cameras at the firm’s headquarters in Tokyo.
January 2014
Essentials
Technology
The Camera and Imaging Products
Mirrorless cameras are considerably more expensive than pointand-shoot devices and even cost more than some DSLRs, though substantially less than professional models like the $3,000 Nikon D800.
can share photos more easily. Sony
Association, a trade group whose
recently introduced a new kind of camera
members include Fujifilm, Nikon, Canon
that clips onto a smartphone.
and other Japanese camera makers, says overall shipments of digital cameras
The X series is a different response.
plunged 39 per cent in volume, and
These cameras fit into a category called
26 per cent in value, from January
mirrorless, which has been a relative
through September 2013.
bright spot for the industry. Shipments of
Camera makers have tried various
‘nonreflex interchangeable lens’ cameras,
things to stem the slide. Some have
which include some of the Fujifilm
equipped cameras with smartphone-style
X-series devices and other mirrorless
features, including Wi-Fi and mobile
cameras, declined only 13 per cent in
operating systems like Android, so people
volume and five per cent in value from
January through September, the trade association said. Fujifilm said in its most recent quarterly earnings announcement that sales of “such high-end models as the X series proceeded smoothly.” The company says it has sold more than 700,000 X-series cameras since the first model, the X100, was introduced in 2011. The name refers to the fact that these cameras do away with the internal mirror that, in reflex cameras, allows the gETTy imagES
user to compose through the lens while
The Fujifilm X-series range has simplified controls.
the shutter is closed. With mirrorless cameras, the photographer composes with the LCD screen or a separate viewfinder. The concept is not entirely new. The venerable Leica rangefinder, which predates the SLR, is technically a mirrorless camera. But compact, digital mirrorless cameras are a more recent innovation. Along with Fujifilm, brands like Olympus, Sony and Nikon have also added mirrorless models to their lineups over the last few years. Mirrorless cameras are considerably more expensive than point-and-shoot devices and even cost more than some DSLRs, though substantially less than professional models like the $3,000
Brisk sales of the X-series has given Fujifilm President Shigehiro Nakajima plenty to smile about.
Nikon D800. The Fujifilm X-E2, a recently introduced upgrade to the X-E1, costs about $1,000. As with the Nikon, REUTERS
80
that is for the body alone; lenses are extra. Mirrorless cameras often have sensors Portfolio
getty images
81
A visitor looks at Fujifilm digital cameras at the CP+ Camera and Photo Imaging Show in Yokohama City.
that are as big as those in entry-level DSLRs and much larger than those in point-and-shoots, providing superior image quality. But they are considerably smaller and lighter than DSLRs. The X-E1, for example, tips the scales at a mere 340 grams. The lenses, too, are more compact. Along with professionals, so-called prosumers – or consumers who spend hundreds of dollars a year, or more, on camera gear – are giving mirrorless cameras a long look. While most mirrorless cameras are more popular in
Camera makers have tried various things to stem the slide. Some have equipped cameras with smartphone-style features, including Wi-Fi and mobile operating systems like Android, so people can share photos more easily.
software menus that have proliferated on many digital cameras, the X series uses simple dials to control functions like the aperture and shutter speed. As with DSLRs and point-and-shoot cameras, the functions can also be set automatically. Masazumi Imai, the chief designer of the X series, explained at Fujifilm’s headquarters in Tokyo that the company interviewed professional photographers about their preferences on everything from the pebbled plastic that covers parts of the cameras to the colour of the paint on the bodies.
Asia than in Europe or the United States,
Almost a dozen different shades of
analysts say, the Fujifilm X series seems to have attracted a global following.
Instead of the array of buttons and
Fujifilm took a different approach in the X
silver were considered. The goal was to
“Someone who is looking at that kind
series. With boxy, rectangular bodies and
give the cameras a certain gravitas, so
of camera isn’t going to be satisfied with
straight, cylindrical lenses, they resemble
professionals would give them a try.
a smartphone,” said Jordan Selburn, an
classic Leicas.
analyst at IHS iSuppli in Santa Clara,
“Because of our heritage in film, picture
“When we were little, when we went into our father’s room or our grandfather’s
California. “Some of those people are not
quality was important, but picture quality
room, there was an important-looking
going to be happy lugging around a DSLR
is difficult to explain, so we needed
camera on the shelf, and we were told not
and a lot of glass, either.”
something else,” said Hiroshi Kawahara,
to touch it because it was valuable,” Imai
a marketing manager in the Fujifilm
said. “We wanted to create that kind of
camera division.
look and feel.” n
While many mirrorless cameras simply look like smaller substitutes for DSLRs, January 2014
Essentials
82
Profile
to some of the weakest opening results in DreamWorks Animation’s history. “I trust Bill’s taste more than anybody else’s, including my own,” said Jeffrey Katzenberg, DreamWorks Animation’s chief executive. Katzenberg has always been the studio’s public face. It was partly design, a way for a small publicly traded company to get noticed on Wall Street, and partly because Katzenberg is who he is: relentless. But while Katzenberg is still involved in major artistic decisions, he has been moving further away from the day-to-day running of his company’s movie pipeline, which is expanding. DreamWorks Animation in 2014 will begin releasing three movies a year, up from two. While Katzenberg is working on a new TV endeavour, an entertainment complex in Shanghai and indoor theme parks in Russia, Damaschke (pronounced DAHmash-kee) is increasingly calling the creative shots. “As someone who really doesn’t like attention, I feel almost uncomfortable saying this, but that is true,” Damaschke said in June. “We put things in front of Jeffrey less frequently.” Damaschke, who started at the studio 18 years ago as a production assistant and
THE QUIET FORCE
rose to chief creative officer in 2011, would
Bill Damaschke, the chief creative officer of DreamWorks Animation, is relatively unknown in Hollywood despite being behind numerous blockbusters, reports Brooks Barnes.
years, DreamWorks Animation’s nine films
be entitled to an insufferable ego. He was blessed with dashing good looks and churns out blockbusters; over the last five have taken in roughly $5 billion worldwide after accounting for inflation, compared with about $3.6 billion for Pixar’s five releases. Instead, the dapper Damaschke
I
© 2013 NEW YORK TIMES NEWS SERVICE
NSIDE A MODEST UPSTAIRS
is quiet and polite, perhaps reflecting his Damaschke, 49, is chief creative officer
Midwestern upbringing. Then again, unassuming is all the rage in
office at DreamWorks Animation in
at DreamWorks Animation, which means
Glendale, California – the one next to
that he runs the factory floor, working with
Hollywood: Kevin Feige, who expertly runs
a framed poster reading “You’ve Got
directors, writers and artists to deliver hits
Marvel Studios, is also nearly invisible. If
the Goods, Step Out and Show ’Em!” – sits
like Kung Fu Panda, How to Train Your
you “strut your stuff,” as another poster
one of the film industry’s most important
Dragon and the Madagascar movies. The
outside Damaschke’s office instructs, you
executives. His name is Bill Damaschke.
studio’s latest computer-animated film,
become vulnerable when movies misfire, as
Turbo, about a speedy garden snail, has
they inevitably do.
Never heard of him? Neither has most of Hollywood.
just recently hit theatres, although it did so
Despite positive reviews, DreamWorks Portfolio
83
Animation’s dark Rise of the Guardians,
underdog story” that finds the animation
sassy Monsters vs. Aliens in 2009 nor the
released in November and directed by
studio “taking a welcome risk and betting
cheeky Megamind in 2010 were strong
Peter Ramsey, cost more than $250 million
on a far-fetched story idea.”
enough at the box office to quickly spawn
to make and market but took in $303.7
The opening total (from July 17 to July
hoped-for sequels. Damaschke began
million, roughly half of which went to
21) for Turbo was a relatively anaemic
urging his filmmakers to think more about
theatre owners. The company wrote down
$31.2 million.
heartfelt moments.
$87 million tied to the film. Guardians is not Damaschke’s first
Turbo in many ways represents an
“Bill’s notes almost always attend to the
artistic shift that Damaschke has quietly
emotional point of the story,” said Chris
disappointment. The money-losing
been adopting at the company. In its early
Sanders, who co-directed The Croods with
Broadway adaptation of Shrek was also
days, DreamWorks Animation movies
Kirk DeMicco. “He will stop us dead in
his baby. But the movie’s failure was
clung tightly to the successful Shrek
our tracks and say, ‘But how does that
particularly crushing.
formula: irreverent humour, pop culture
character feel about this?’ Jeffrey, who
inside jokes, lots of action, celebrity voices.
we honestly don’t see that much, despite
were cool may have given pause to the
Turbo, which riffs on the Fast & Furious
what everyone thinks, attends more to the
most important person buying tickets,
movies, certainly has some of that DNA.
audacity of the film.”
and that’s mom,” he said. Noting that
But the film also has atypical quiet
“Some of the things that we thought
The oldest of seven children, Damaschke
the movie was a big seller on DVD,
moments and tries to break ground
grew up in Chicago and graduated from
he added, “I’m still healing from the
by including lots of Hispanic cartoon
the School of Theatre Arts at Illinois
Guardians experience, to be brutally
characters. Its animation style also differs
Wesleyan University. He pursued musical
honest with you.”
from The Croods, the studio’s hit caveman
theatre – including a stint in Godspell in
movie from March, or next year’s Mr.
New York – but ended up in Los Angeles
Aside from the obvious – it stars a snail –
Peabody & Sherman, which is based on
as a production assistant on Disney’s
the movie was directed by David Soren, a
segments from the 1960s-era TV series
Pocahontas in 1994. The next year he
first-time feature filmmaker. Reviews were
featuring Rocky and Bullwinkle.
moved to DreamWorks Animation, where
Turbo was another creative gamble.
mixed. The Hollywood Reporter deemed
“We are trying to really lean into the
it “narratively challenged” and zeroed in
different sensibilities of our filmmakers,”
on a theme that could turn off mothers:
Damaschke said.
“If you’re too small or weak or otherwise
There are several reasons behind the
he rose up the ranks. “This studio may be Jeffrey’s sandbox,” said Soren, the Turbo director, “but Bill knows every kid who has ever played in it
incapable of greatness, you have a shot to
shift. While DreamWorks Animation’s
and where every shovel is buried. Bill may
win if you’re juiced.”
original formula kept delivering hits, ticket
be the biggest reason artists keep coming
buyers started to show fatigue. Neither the
back to play here.” n
But Variety called it an “endearing
Bill Damaschke, seated third from left, with an ensemble of DreamWorks Animation directors at the studio’s lot in Glendale, California. January 2014
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Essentials
Culture
Rock StaR Ailsa Craig, a Scottish icon, is listed for sale as the only island that has ever won an Olympic Gold medal, reports John Burns.
Ailsa Craig, off the coast of Scotland. Portfolio
85
The sTunning volcanic island
National Trust in 1945, and in 2010 the
of Ailsa Craig has been part of Scottish
current marquess decided to part with
soaring some 335 metres into the sky off
legend for a thousand years, its sugarloaf
Ailsa Craig, posting an initial price of $4
Scotland’s west coast in 1818, he repaired
profile decorating Scottish bank notes and
million. That figure was later cut to $2.4
to a mainland inn and wrote a sonnet
memorialised in a Keats sonnet.
million, and as the waters of the Firth of
by candlelight describing it as a “craggy
It has no inhabitants, no electricity, no
Clyde have lapped at Ailsa Craig’s rocky
ocean-pyramid,” summoned from the deep
fresh water and no arable land – nothing
shore each day, little has changed in the
by some mythic power, and attended for
of value, it would seem, but for this: For
intervening years. The island remains
eternity by eagles and whales. Nearly 200
a century and more, its quarries have
misty, monumental and for sale.
years later, with Scotland approaching a
been the source of the distinctive, waterresistant microgranite used to make most of the world’s curling stones. These include all those used in recent world championships and every Olympics since 1924, including the Sochi Games that begin in February. But the modest income from the quarrying of the island’s prized strains of blue hone and common green and a lease granted to Britain’s Royal Society for the Protection of Birds has taxed the dwindling resources of its owner, the eighth Marquess © 2013 New York Times News service
When Keats first saw the island
of Ailsa, whose family has owned the island for 500 years. Like many of Britain’s old landowning families, the marquess’ family has been through decades of retrenchment as a result of inheritance taxes. It lost
referendum on independence from Britain
It has no inhabitants, no electricity, no fresh water and no arable land – nothing of value, it would seem, but for this: For a century and more, its quarries have been the source of the distinctive, waterresistant microgranite used to make most of the world’s curling stones.
the family seat, Culzean Castle, to the
January 2014
country’s national consciousness, redolent of the rugged, stand-alone character many Scots pride as their birth-right. In November, approaching across 16 kilometres of shimmering open sea aboard his 10.7-metre lobster boat, the M.V. Glorious, the skipper, Mark McCrindle, broke the silence of his cramped wheelhouse to say that in 30 years of plying the waters from the nearby port of Girvan, he had rarely seen it looking more majestic. “Aye,” he said, “she’s a beauty.” Would he like to own it? “Twenty thousand pounds is all I’d pay,” he said, quickly adding, “What would I do with it?” Finding a buyer will require more than the poetic flights of Keats, or “the dreams” the 57-year-old marquess says he would
Rock formations on the southwest side of Ailsa Craig.
Microgranite quarried on Ailsa Craig is made into Olympic curling stones at Kays of Scotland in Mauchline.
in September, it remains an icon in the
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Essentials
Culture
One of two gaspowered foghorns on Ailsa Craig.
Granite from Ailsa Craig is cut to make curling stones.
enticing, or at least warmer, locations than the Firth of Clyde. Vladi’s medal reference referred to the be selling to anyone whose fancy runs to an island that has no modern
Charles Kennedy, the eighth Marquess of Ailsa, is a member of the family that has owned Aisla Craig for 500 years.
curling stones used when Rhona Martin, the Scottish champion who threw what became known as the “stone of destiny” to win the women’s gold medal at the
conveniences, no active forms of employment since the quarrying ended
for pirates and, for the last 25 years, a
Winter Games in Salt Lake City in 2002.
in 1969, and only one habitable structure
preservation area for tens of thousands
The victory set off fireworks celebrations
among the rusting, roofless ruins of the
of breeding seabirds, especially gannets
in Edinburgh and Glasgow; it was the
quarters once used by men working in the
and puffins.
first time Britain had won a winter gold in 18 years.
lighthouse or the quarries. Over the centuries, the island’s 89
So it is no surprise to find that property
Scots, and others across Britain, are
hectares, much of it in the form of
agents listing it reach for hyperbole in
hoping for a repeat at the Sochi Olympics,
precipitous crags and thick uphill reaches
stating its attractions. “The only island to
and they look to Ailsa Craig, at least
of bracken, have provided Scots, and
win a gold medal in the Olympic Games!”
metaphorically, as a talisman.
sometimes their enemies, with an ocean
says Farhad Vladi of the Hamburg-based
fortress. Barely 1.2 kilometres from tip to
company Vladi Private Islands. He claims
quarried granite was taken off the island
tip, the island has served as a redoubt for
to have sold more than 2,000 islands
this summer by landing craft and used for
repelling Spanish invaders, a sanctuary
across the globe, many of them in more
cutting, spinning and polishing into the
Two thousand tons of previously
Portfolio
Essentials Culture Sochi stones at the factory at Mauchline, 40.2 kilometres away on the Ayrshire mainland, that has a contract for the Olympic stones. A few of those stones will slip gently out of the sure hands of Britain’s best medal hope, its world champion women’s team and its 23-year-old skip, Eve Muirhead. The 20-kilogram, kettle-shaped rocks will be made, in the body, from the speckled Ailsa Craig granite known as common green, and will glide to the “house,” or target, on a base ring of the island’s inimitable blue hone, whose tight molecular structure makes it impenetrable to melting ice. In the meantime, the marquess, who has lost a leg to diabetes, waits for an offer on what he calls his rock. During an encounter at his favourite pub, among a bustle of weather-beaten farmers and bushybearded seadogs at the old marketplace in Ayr, he spoke with scant sentiment about the prospect of giving up ownership of the island, which the listing agents say has failed to attract any serious interest. “It’s going to go out of the family,” he said. “But I think of it this way: It’s not going anywhere. It’s always going to be there, and it really doesn’t matter who owns it.” The same dispassion came when the talk turned to Ailsa Craig as a sporting icon. With one of the other titles he inherited, the marquess, as Lord Archibald Angus Charles Kennedy, head of the Clan Kennedy, has been a celebrated guest at highland games and other clan gatherings in Scotland and Ireland, and in the United States, Canada and other far-flung outposts. But his passions fall short of caber-tossing, shotputting and, especially, curling. With a smile and more than a hint of mischief, he summarised his attitude toward the sport that is said to have had its origins on Scotland’s frozen ponds in the 16th century. “It’s the boringest game you can ever Curling stones for the Sochi Olympics receive a final polishing. January 2014
watch,” he said. n
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Essentials
Other Business
Sponsor a Skull
Anniversary Sale A yellow jumpsuit worn by martial arts star Bruce Lee in his last film sold for HK$780,000 ($100,600) in a Hong Kong auction. The outfit designed and worn by Lee in the 1972 movie Game of Death sold for more than twice its high estimate of HK$300,000 according to auction house Spink China. The auction, held to commemorate the 40th anniversary of Lee’s death in 1973, offered 14 lots of memorabilia that earned more than HK$2 million, including HK$540,000 paid for
A Philadelphia museum has the
the skulls, which have been on
a “nunchaku” or chainsticks, a martial arts
perfect gift idea for the person who
continuous display for more than
weapon used in the film.
has everything, including a love of
100 years, to lose or crack their
science and a dark sense of humour.
teeth, said curator Anna Dhody.
“Something like the jumpsuit has never been offered before,” said Anna Lee, vice chairman of
A $200 donation buys the
The skulls were amassed by
Spink China. “Comparatively speaking, it’s still
preservation of one of 139 skulls
19th-century Viennese scientist
very inexpensive compared with something from
dating back to the 19th century
Josef Hyrtl to debunk the study
Marilyn Monroe.”
in a collection at the Mütter
of phrenology, the belief that
The films of Lee, who was just 32 when he
Museum of the College of
the shape of a skull determines
died, have accorded him cult status, driving up
Physicians of Philadelphia.
a person’s moral calibre and
prices of items such as a pair of his kung fu
Subtle vibrations from footsteps
shoes from the film Walk in the Footsteps of the
of museum patrons have caused
that different races are actually different species.
Master and a bamboo whip.
Sweet Success Holiday cheer in Texas became even sweeter thanks to a giant gingerbread house that broke a world record for confectionary construction. Coming in at 35.8 million calories and covering an area nearly the size of a tennis court, the seven-metre-high gingerbread house in Bryan, Texas, was declared the biggest ever by Guinness World Records. The house, with an edible exterior
of butter, 1,327 kg of brown sugar, 7,200 eggs, 3,266 kg all-purpose flour,
mounted over a wooden frame, was
31 kg ground ginger and a few other
built by the Traditions Club near
ingredients, bake and form into panels
Texas A&M University to help raise
for mounting.
money for a trauma centre at the REUTERS
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regional St. Joseph’s Hospital. The recipe is simple. Mix 820 kg
The edible and aromatic panels, icing and candy stood up well to the Texas sun, as well as a few storms. Portfolio
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