Issue 79 ■ July 2012
Exclusive to Emirates First Class and Business Class
TUNECORE Changing Digital Music CREATIVE ACCOUNTING How Apple Saves Millions THE REPAIR CAFÉ A Sustainable Fix
Wang Jianlin The Next Media Mogul?
New York 717 MadisoN aveNue east HaMptoN 23 MaiN street Las vegas ForuM sHops devikroeLL.coM
This issue July 2012
Exclusive to Emirates First Class and Business Class
Cover Story 24 Risky Business Wang Jianlin, the Chinese real estate tycoon who has built up a $17 billion empire, is spending $2.6 billion to acquire North America’s second largest movie theatre chain. Some industry analysts question this move, especially as US movie attendance has hit a 16-year low. But Wang is a man who bets big and wins big.
Features 30 India’s Power Dilemma
Last year, an estimated €8 billion ($10.2 billion) in collectible
India has struggled to provide enough electricity for its
taxes were in arrears – nearly half of Greece’s budget deficit.
Pressure is mounting on the country’s rich to pay their share.
34 Shaking Up the Music World
50 Challenging the Throwaway Culture
Jeff Price, the founder of TuneCore, is one of the digital
The Repair Café consists of volunteers in the Netherlands
world’s most influential figures and has no qualms in
that fix things for free. This has both an environmental and
targeting the music majors.
38 Retailers Target the US
54 The New Prince of L’Oreal
Uniqlo’s first foray into the American market ended badly.
Jean-Victor Meyers, Liliane Bettencourt’s 25-year-old
But now the Japanese retailer, along with other foreign
grandson, now has a seat on the 14-member board that
brands, is eying rapid expansion.
runs the French cosmetics giant.
42 Sidestepping Billions in Taxes
46 Greece’s Tycoons Stay in the Background
Despite having some of the world’s largest coal reserves,
58 Using Technology, Not Salespeople
Most local and international tax codes were written before
Younger shoppers are increasingly using technology while
the technological revolution, which allows companies such
browsing in shops, and retailers are quick to accommodate
as Apple to benefit from creative but legal accounting.
Exclusive to Emirates First Class and Business Class
61 The Other Vienna Forget coffee houses, waltzes and Freud. The real attraction of Vienna is its people who know how to live.
66 Breeder of Champions Christine Jamar-Demeersseman is internationally respected for her horse stud, which produces meticulously bred Polish Arabians that sell for millions.
70 Senegal’s Wrestling Mania 61
Traditional wrestling, known as laamb, has become big business thanks to corporate sponsorships.
74 E-Readers Challenge Publishing Schedules In the past, novelists were fine writing a book a year. But E-readers are forcing authors to publish more.
78 Kenya’s Green Power Plan The Lake Turkana Wind Power project aims to provide reliable, low-cost wind power to the Kenyan national grid,
reducing its dependence on oil.
82 A Taste of the Sea The Portuguese are the largest consumers of fish per capita in Europe, and it is salted cod that tops the menu.
86 King of the Desert The 2012 Toyota Land Cruiser VXR+ is a mighty vehicle and now it offers even more luxury.
88 Other Business Portfolio takes a light-hearted look at the latest business news.
13 Notebook World business in a nutshell.
17 Observer Spotting and analysing business trends.
22 Column: Stephen Burgen Spain’s Olive Oil Dilemma
Published for Emirates by
PO Box 2331, Dubai, UAE. Telephone: (+971 4) 2824060, fax:(+971 4) 2824436, e-mail: email@example.com
Editor-in-Chief Obaid Humaid Al Tayer Group Editor & Managing Partner Ian Fairservice Group Senior Editor Gina Johnson Group Editor Guido Duken Picture Researcher Hilda D’Souza Art Director Tarak Parekh Designer Charlie Banalo Senior Production Manager S Sunil Kumar Production Manager C Sudhakar Group Sales Manager Jaya Balakrishnan Email: firstname.lastname@example.org General Manager – Group Sales Anthony Milne Email: email@example.com Advertisement Manager Rameshwar Nepali Email: firstname.lastname@example.org
INTERNATIONAL MEDIA REPRESENTATIVES AUSTRALIA/NEW ZEALAND Okeeffe Media; Tel + 61 89 447 2734, email@example.com BENELUX M.P.S. Benelux; Tel +322 720 9799, francesco.sutton@ mps-adv.com chINA Publicitas Advertising; Tel +86 10 5879 5885 FRANcE Intermedia Europe Ltd; Tel +33 15 534 9550, firstname.lastname@example.org gERMANy IMV Internationale Medien Vermarktung GmbH; Tel +49 8151 550 8959, email@example.com hONg KONg/MALAySIA/ThAILAND Sonney Media Networks; Tel +852 27 230 373, firstname.lastname@example.org INDIA Media Star; Tel +91 22 4220 2103, email@example.com ITALy IMM Italia; Tel +39 023 653 4433, firstname.lastname@example.org JAPAN Tandem Inc.; Tel + 81 3 3541 4166, email@example.com NEThERLANDS GIO Media; Tel +31 6 2223 8420, firstname.lastname@example.org SOUTh AFRIcA Ndure; Tel: +27 84 701 2479, email@example.com SPAIN IMM International; Tel +331 40 1300 30, firstname.lastname@example.org TURKEy Media Ltd.; Tel +90 212 275 51 52, email@example.com UK Spafax Inflight Media; Tel +44 207 906 2001, firstname.lastname@example.org USA Totem Brand Stories; Tel +212 896 3846, email@example.com
Emirates takes care to ensure that all facts published herein are correct. In the event of any inaccuracy, please contact The Editor. Any opinion expressed is the honest belief of the author based on all available facts. Comments and facts should not be relied upon by the reader in taking commercial, legal, financial or other decisions. Articles are by their nature general, and specialist advice should always be consulted before any actions are taken.
Printed by Emirates Printing Press, Dubai, UAE
ge fique Voya My Magni
niche i Cor Dhab u b el A Sofit
c turisti in a fu e vivre king d o t lo r r a e s , ov Sofitel’ erpiece Enjoy oad. l mast niche R ectura on Cor archit t 6 n o fr x 4496 - PO Bo the sea mplex 37777
81 a Co l Plaz 71 (0)2 Capita Tel. : +9 East ATES he Road B EMIR ic RA rn A Co NITED ABI - U ABU DH
Abu Dhabi, Chicago, Paris, Dubai, Bangkok... Discover all our magnifique addresses around the world on www.sofitel.com
BUSINESS NEWS IN BRIEF
Solar Boom for Japan Japan is poised to overtake Germany
largest solar projects planned or under
worldwide by new installations last year,
and Italy to become the world’s second-
consideration were all announced
when it added 1.3 gigawatts of solar to
biggest market for solar power as
between October and April, as the
bring its installed base to five gigawatts.
incentives starting 1 July drive sales for
government worked out details of the
Next year builders will erect roughly
feed-in tariff programme, according to
triple that level, or another 3.2 gigawatts
New Energy Finance.
to 4.7 gigawatts. A gigawatt is enough to
Japan’s Industry Minister Yukio Edano set a premium price for solar electricity
Prime Minister Yoshihiko Noda’s effort
supply about 243,000 homes in Japan. Only China will exceed Japan in terms
that’s about triple what industrial
to cut dependence on atomic energy that
users now pay for conventional power.
provided about 30 per cent of Japan’s
of solar capacity growth as it supplants
That may spur at least $9.6 billion in
power before the Fukushima nuclear
Italy and Germany, which held the top
new installations with 3.2 gigawatts of
meltdown in 2011 will help a solar
two positions in 2010 and 2011, London-
capacity, which is equal to the output of
industry suffering incentive cuts across
based New Energy Finance estimates.
three atomic reactors.
Europe. It’s also raising concern among
Japan got about 1.6 per cent of its
Japanese business groups that clean
energy from renewables in 2011, the
will buy solar, biomass, wind, geothermal
power aid will raise bills and slow Japan’s
smallest portion among Group of Seven
and hydro power. All costs will be passed
countries after Canada. It trailed the
Under the new programme, utilities
on to consumers in surcharges, which the
Utilities will pay 42 yen (53 cents)
U.S. and France in the G-7 in atomic
government said will average out at 87
a kilowatt-hour for 20 years to solar
power consumption. The shift toward
yen a month per household.
power producers, almost twice the rate
solar reflects concern that the cost of
in Germany, the world’s biggest market
imported fossil fuels will rise in the
by installations. Japan ranked sixth
coming decades. n
The new incentives will encourage utility-scale projects. Japan’s five July 2012
Notebook Numbers Game
Boeing 747-400 Prices TumBle
billion worth of funds was
injected into portugal’s three
Prices for Boeing’s 747-400s, the
largest banks: Banco Comercial
most popular wide-body plane,
potugues, Banco Bpi and
are tumbling as carriers rush
state-owned Caixa geral de
to replace what were once their
Depositos. this will place them
flagship aircraft with newer and
amongst the “most capitalised
more fuel-efficient models. Ten-year-old passenger 747-
banks in europe”. the banks, in turn, will use the funds to support economic growth
million of potential dividends have been voluntarily
400s are worth a record low
passed up by apple’s boss tim Cook. he declined
$36 million, about 10 per cent
through corporate lending and
the quarterly dividends of $2.65 per share for his 1.12 million
less than similar aged planes
each bank will invest a minimum
restricted stock that apple plans to disburse starting 1 July.
last year, according to Ascend
of €30 million a year in small and
apple has nearly $110 billion in cash and in march the tech giant
Worldwide, amid high fuel costs
decided it would use it to start paying dividends to shareholders
and a cargo slump that has
and buy back some of its shares.
damped interest in converting aircraft into freighters. Forty-
million was spent by China
In Figures flexibility to run lower cost heavy oil
auction in paris. the tintin in
eight of the 404 humpbacked
america cover, hand-drawn
passenger 747-400s worldwide
by Belgian writer and illustrator
have also been placed in storage,
herge, broke its own record
according to the London-based
set in 2008 when it sold for
aviation consultancy, as the
once “Queen of the Skies” is
minmetals Corporation, a Chinese
from south america, Latin america
shunned for Boeing 777s and
metals and mining company,
and potentially from Canada, if
to build a replica of austria’s
the delayed Keystone XL pipeline
UNesCO heritage site, hallstatt
The first four-engine 747-400 was delivered to Northwest Airlines in 1989. The standard
Village. the replica version is expected to further draw visitors and investors to subtropical
billion savings in
version can fly as far as
pension plan expenses
7,260 nautical miles (13,450
southern China. Critics say the
has been announced by Us
kilometres), carrying 416
knock-off, high-end residential
automaker general motors. the
passengers in three classes.
project, copied right down to the
company offered thousands
statues and church spire, sets a
of retiring workers lump-sum
new standard in a China known for payments and annuities instead of
Newer aircraft use less fuel
for a gallon
because of the development of
more efficient engines and the
monthly payment. the proposed
gasoline places Norway on
use of lightweight materials.
changes will only apply to salaried
top of the list of the world’s
The Boeing 787 has a fuselage
employees and will not affect
most expensive gas rankings
built from reinforced plastics,
plans of royal Dutch
hourly employees whose pension
compiled by Bloomberg. Norway
compared with the 747’s heavier
shell and saudi aramco’s joint-
benefits are negotiated directly with
is the only major oil producer to
venture, motiva enterprises texas
the United auto Workers union.
have expensive fuel and that’s
The Airbus A380, which
because instead of subsidising
surpassed the 747-400 as the
million was the
fuel at the pump, the country
world’s largest commercial plane
record price paid
uses its oil profits for services
on entering service in 2007, has
the crown as the largest in the Us. for a rare 1932 cover drawing of
such as free education and
become the flagship for carriers
this expansion gives motiva the
such as Emirates.
gulf Coast refinery, will see the plant’s production capacity top 600,000 barrels per day, taking
a tintin comic book at a recent
Notebook EuropE’s richEst Man Just as spain asked europe for a bailout
about 22 per cent of inditex’s sales
topping $125 billion, amancio Ortega, the
will come from spain this year, compared
septuagenarian spaniard who founded
with 45 per cent from emerging markets,
retailer inditex, became the region’s richest
according to anne Critchlow, an analyst
at societe generale sa in London. the
the tycoon’s fortune rose $3.8 billion to
company still has most of its stores – more
$39.5 billion on 13 June, according to the
than 4,300 – in europe, with almost 900
Bloomberg Billionaires index. that places
in asia and about 400 in the americas.
the owner of the Zara clothing chain above
inditex said it plans to start online sales in
sweden’s ingvar Kamprad, who has an
China in september.
estimated net worth of $37.2 billion, and day at $22.7 billion. Ortega’s wealth has surged even as
Amancio Ortega (left)
Ortega, 76, became the fourth-richest
France’s Bernard arnault, who finished the
individual on earth after adding $4.6 billion to his fortune so far this year. the only people richer are mexican
spain reels from a financial crisis that
and adding stores in emerging markets,
telecommunications tycoon Carlos slim,
has sent borrowing costs spiralling while
inditex managed a 30 per cent gain in
microsoft co-founder Bill gates and
joblessness hovers above 20 per cent. By
first-quarter profit, sending shares up 12
Berkshire hathaway chairman Warren
reducing its dependence on its home turf
Investors Chase Lithium cells such as lead-acid. There is about 1.7 grams of lithium carbonate equivalent in a mobile phone, 2.1 grams in a smart phone and 20 grams in a tablet, according to Dahlman Rose. Global consumption may jump to 300,000 metric tons a year by 2020 from about 150,000 tons now, Dahlman Rose said in a 7 June report. Demand for lithium batteries has been growing at about 25 per cent a year, outpacing the four to five per cent overall gain in getty images
lithium. Talison Lithium, whose shares have gained 22 per cent in the last month, The popularity of the iPad and the
of the Prius electric-petrol car, have
together with Soc. Quimica & Minera
increase in electric cars has investors
few alternatives as they pursue higher
de Chile, Rockwood Holdings and FMC,
chasing producers of lithium for batteries.
performance and mobility, leading
account for almost 95 per cent of world
Dahlman Rose & Co analysts to forecast
supply. Rio Tinto Group, the third-biggest
lithium demand will double by 2020.
mining company, may join the largest
Prices for the conductive metal have tripled since 2000 in a market now worth $1 billion a year as uses expand
The advantage of lithium-ion over other
suppliers if it goes ahead with a mine in
in vehicles, ceramics, electronics and
battery types is that a typical cell can
Serbia it says is capable of producing 20
lubricants. Apple and Toyota, maker
generate more electricity than competing
per cent of global output of the metal.
8/10 Hans Road London, SW3 1RX
Via Montenapoleone 21/A Milan, 20121
Bolshaya Dmitrovka 20/1 Moscow, 107031
The Plaza Fifth Avenue at Central Park South New York, NY 10019
Forte Village Resort
S. Margherita di Pula (Cagliari) Sardinia - Italy 09010
BUSINESS NEWS IN BRIEF
The Church of San Paolo was damaged beyond repair by the recent earthquakes in Mirabello.
Italy’s Destroyed Treasures The May earthquakes killed 24 people and left thousands homeless. They also destroyed or damaged many cultural treasures, reports Elisabetta Povoledo.
have not yet been tallied, but few expect that the already strained Culture Ministry – never mind the state – will have an easy time financing the restorations at a time when Italy, and all of Europe, is reeling from the eurozone’s worst economic
magnitude 5.8 that struck 29 May –
Mirandola, something crumbles or new
killed 24 people and forced about 15,000
Many churches and city halls have
cracks appear. “It’s like receiving a daily list
people from their homes. They revealed
set up bank accounts and are asking for
of war casualties,” said Carla Di Francesco,
the vulnerability not only of many
contributions for the reconstruction, or are
the supervisor for cultural heritage in this
modern structures, collapsing countless
drawing on local companies – like Ferrari
part of northern Italy. The second of two
warehouses and factories, but also of the
and Ducati – for money. But even back-
major earthquakes in May “compounded
area’s historic monuments.
of-the-envelope estimates by experts and
the emergency, and we had to start monitoring everything from scratch.” Teams of art historians, restorers,
© 2011 NEW YORK TIMES NEWS SERVICE
WITH EVERY NEW QUIVER IN
Dozens of churches bear the wounds, and towers crumpled as if made of matchsticks. Palazzos, fortresses and
Culture Ministry officials put the probable costs in the millions of dollars. Emergency scaffolding has been erected
archaeologists and consulting engineers,
storied museums have all been closed,
and walls have been shored up. Bricks
accompanied by firefighters, have been
consigned to an uncertain future. There are
are being recovered and numbered, when
charting the extent of the damage to
degrees of damage, of course. But in some
possible. Movable artefacts, like paintings,
historic buildings caused by the earthquakes
cases, like that of the Church of San Paolo
statues, archives, and ecclesiastical
in the Emilia-Romagna region on a disaster
in Mirabello, or the Church of San Martino
furnishings and fittings, are mostly being
map that continues to grow.
in Buonacompra, which are split open to
moved to the Ducal Palace in Sassuolo,
the sky, there is little to be done.
which the Culture Ministry has set up
The quakes – the first on 20 May, with a magnitude of 6.0, and the second, a July 2012
The costs to Italy’s cultural patrimony
as a temporary repository. The works
Observer are catalogued and, officials hope, will eventually be restored. The quakes also rattled art-rich cities like Ferrara, Modena and Mantua. The
The partially damaged clock tower in Sant’Agostino. The list of damaged historic buildings in the EmiliaRomagna region continues to grow.
Ducal Palace in Mantua, which features celebrated frescoes by the 15th century artist Andrea Mantegna, has been closed to the public “until we get the money to fix these fissures,” said Giovanna Paolozzi Strozzi, the art superintendent of Modena, as a precaution after large cracks opened in the roof. The quake on 29 May provided the coup de grace to many already weakened structures. In Pieve di Cento, the shaking collapsed the cupola of the Church of Santa Maria Maggiore, showering debris Nearly all of its historic churches have
into the nave and threatening paintings by
amplified,” said Fabrizio Toselli, the mayor
renowned Baroque artists like Guercino,
of Sant’Agostino, whose 19th-century town
been affected, and each one is being
Guido Reni and Lavinia Fontana, which
hall has a multistorey hole in one wall.
painstakingly examined and classified
are now exposed to the elements.
“There’s been a distortion of our territory;
by on-site teams. “Right now we’re just
nothing is the same anymore.”
trying to limit the damage,” Bertoli Barsotti
In Finale Emilia, the early 13th-century tower clock that was the town’s symbol
Inside the building, on the second floor
said. After the 29 May earthquake, the
crumbled in the first quake, and the town’s
of what was once considered one of the
list of affected monuments in the diocese
15th-century Rocca Estense, a former
most elegant council halls in Italy, hangs
grew significantly, with the additions of
fortress, lost its crenelated towers. Gaping
a gigantic, and very heavy, Murano glass
the churches of Santo Stefano and San
cracks riddle the walls of the 14th-century
chandelier, a gift from Italo Balbo, a
Petronio in Bologna, the city’s jewels. But
fortress in nearby San Felice sul Panaro.
Mussolini crony, that miraculously survived
Bertoli Barsotti played down the possibility
Residents fear it will soon topple.
the earthquake. Officials hope to save
that the two buildings were in real danger.
The fortresses were among the buildings
it with the help of a team of firefighters
At the parish church of San Felice, a
that survived the last major quake in the
who specialise in recovering artefacts
medieval town in the centre of the region,
Emilia-Romagna region, which occurred
from dangerous situations. “They have an
a pendulum clock in the rectory, frozen at
in 1570 and set off periodic aftershocks for
acrobatic particularity that makes them
4:03, is a permanent reminder of when the
four years. Then, the earth slept for nearly
very useful,” said Fabio Carapezza Guttuso,
first quake shattered the sleep of thousands
a senior Culture Ministry official, referring
and collapsed the roof of the church.
Indeed, Emilia-Romagna was considered a low-risk area for earthquakes. For
to the firefighters. The problem, said Paolozzi Strozzi,
In Pieve di Cento, the young mayor, Sergio Maccagnani, is concerned about the
hundreds of years, buildings were
Modena’s art superintendent, is that there
town’s future and the task ahead. But he
constructed “with a total absence of a
are not enough such experts to go around.
said he drew inspiration from the mettle of
seismic culture,” which is why so many
“They are overloaded with work,” she said.
his ancestors. “Our grandparents went through
succumbed, said Gian Michele Calvi, a
“Of our churches in those areas,
professor of seismic engineering at the
there isn’t one that’s still open, if only
much tougher times,” he said, citing the
University of Pavia.
for precautionary reasons,” said Anna
hardships of World War II and the years of
Maria Bertoli Barsotti, who works for the
poverty that followed. “Italy was destroyed,
may be as deep as the physical damage.
cultural heritage office of the Diocese of
and they rebuilt a country,” he said, and his
“The problem is that this wasn’t a seismic
Bologna, which encompasses several of the
generation can do the same. “We just need
area, so citizens’ reactions have been
to act responsibly.” n
The psychological impact on the region
Observer O N E 2 W AT C H TExT: HildA d’sOuzA
In appointing Harriet Green as its new Chief Executive Officer, troubled Thomas Cook Group – the 171-year-old British travel group – seeks fresh perspective to transform its struggling business. Green will take the position on 30 July and succeeds interim CEO Sam Weihagen, who will stay with the company until 30 September to ensure a smooth transition. Former chief executive Manny Fontenia-Novoa resigned in August last year. Green, 50, is new to the travel industry but she is a seasoned electronic industry veteran. She joins Thomas Cook after serving six years as CEO of leading UK electronic business Premier Farnell. Green, a London University graduate with a BA in medieval history and a postgraduate degree in business psychology, started her career in 1985 as Managing Director of electric component firm Macro Group. Married with two children, Green takes the helm at Europe’s second largest tour operator at a very crucial phase as the shares of the debt-laden holidaymaker have nosedived nearly 90 per cent in the past year. This has forced the firm to sell a number of assets to pay its debts, including a 77 per cent stake in Thomas Cook India and a Spanish hotel chain. Green has confidently accepted the challenge, saying: “Thomas Cook is an iconic brand in the leisure travel industry. I am very excited to be joining the team at this time, to lead the business forward as we rebuild shareholder value through innovation and sustained focus on the needs of our customers, suppliers and employees.” Thomas Cook has been hit particularly hard by the recession as consumers increasingly turn to the internet to book their own holidays and eschew traditionally popular vacation destinations such as North Africa following the uprisings that began last year. Green’s vast experience in procuring new business, moving into new markets, and more importantly her internet credentials that saw profitable e-commerce online sales at Premier Farnell, will be put to the test in reviving the travel firm. In addition to executing the series of disposals initiated to reduce the company’s £890 million debt, and sale and leaseback of part of its aircraft fleet, Green’s turnaround plan for the UK business focuses on fewer and betterquality hotels and effectively using the internet to drive more online bookings. Thomas Cook chairman Frank Meysman described Green’s appointment as marking the start of a new era for Cook.
Resurgent Coal Threat to Carbon Emissions There has been a three per cent increase in world carbon
emissions from energy use in 2011, due to increased use of coal and other fossil fuels such as oil and gas. Coal has a 30 per cent share of the global energy market – its highest level in more than 40 years – undermining attempts by governments to reduce their carbon emissions, according to the latest figures. China and India both increased their use of carbon-heavy coal by over nine per cent but Europe, where political consensus against global warming is strongest, also saw a four per cent increase, according to the BP Statistical Review of World Energy. Industrialisation of developing countries and cheap prices are driving coal demand. According to the BP statistics, global oil consumption grew by less than one per cent to reach 88 million barrels a day in 2011 despite the Brent crude price averaging $111 a barrel, an increase of 40 per cent on the previous 12 month period. Annual production of oil increased by 1.1 mb/d due to record output in Saudi Arabia, the UAE and Qatar while demand was strongest in China – up 5.5 per cent. Oil remains the world’s leading fuel, at 33 per cent of global energy consumption, but it continued to lose market share to reach its lowest level since 1965, BP says. The statistics show UK oil production falling 17 per cent and gas output down 21 per cent, while global oil reserves are still large enough to serve current demand for 54 years, according to BP. A move from coal to gas would help reduce CO2 emissions quickly, as would technological breakthroughs in the renewable energy sector.
Observer US AttrActS BArgAin HUnterS a weak dollar and the tumbling house
ago. the dollar’s weakness has also
prices that resulted in foreclosures
drawn new buyers. Five states accounted for 55 per cent
across america have attracted a wave of buyers from europe, asia, Canada and
of purchases – Florida, California, texas,
arizona and New york. Florida was the fastest growing destination, accounting
international buyers accounted for
for 26 per cent of foreign sales.
$82.5 billion of homes sold in the Us in
more than half of foreign buyers came
the year to march, nine per cent of sales, according to a survey by the National
from Canada, China, mexico, india and
association of Realtors – a jump of 24
Britain. Four in 10 wanted somewhere
per cent from the previous year. Us house prices crashed spectacularly
to live and a similar portion were looking for holiday homes or buying to let. more
in 2007 and are still more than 30 per
out. the s&P/Case shiller index of prices
than 60 per cent paid in cash, and many
cent lower than at their peak in 2006, but
gained 0.1 per cent in march, though it
chose not to live in the Us for more than
recent data suggests they are bottoming
was still down 2.6 per cent from a year
six months a year for tax reasons.
Microsoft’s Policy U-turn Microsoft has unveiled its own Windowspowered tablet computer called Surface, altering its strategy from focusing on software and relying on partners to make
Microsoft CEO steve Ballmer recently unveiled the Windowspowered surface tablet.
the new machines. This approach mirrors Apple, which has had huge success with the iPad. The world’s largest software maker is stepping up its assault on the tablet market as consumers choose the devices over laptops, weakening the personalcomputer market and curbing Windows revenue. The new strategy threatens to
sour Microsoft’s relationship with some PC makers, many of which have been investing to develop their own Windows 8
Tablet shipments, by comparison, are
the Zune music player. It didn’t fare any
tablets and may not want to compete
forecast to almost double to 116 million
better against the iPod, and Microsoft
directly with Microsoft.
units this year, Gartner estimates.
discontinued the product last year.
The company wants to release
Apple’s success with the iPad may
The addition of a tablet or other
Windows 8, the new version of its
be pushing Microsoft to seek greater
hardware device may erode profitability
software that is optimised for touch-
control over the hardware design so
in the Windows business, which currently
screen tablets, in time for the end-of-year
it works seamlessly with the software,
sells just software with operating margins
holidays. Windows 8 will arrive amid a
like Apple does. The last time Microsoft
of more than 60 per cent. By comparison,
deteriorating PC market – research firm
opted to make its own hardware because
computer maker Dell’s operating margin
Gartner cut its 2012 PC shipment growth
its partners weren’t gaining traction
for the most recent fiscal year was about
forecast to 2.7 per cent from 4.4 per cent.
against Apple, the company produced
seven percent. Portfolio
Luxury Services Expected to Boom
Mohammed bin Rashid Award for Young Business Leaders (Winner 6th Cycle, 2010)
The Law Firm Leaders Trust One-of-a-kind adventures for the world’s super rich appear to be the latest status symbol. A study by Boston Consulting Group (BCG)
Deaifis won an important intellectual property dispute in our favor. Swiss Arabian Perfumes Group Founder, Hussein Adam Ali
identifies a shift from “owning a luxury to experiencing a luxury” with bespoke treats now accounting for more than half of the $1.4 trillion spent on luxury goods and services last year. Helicopter skiing in Alaska or a getaway to luxury goods group LVMH’s exclusive hideaway in the Maldives are the current trends
Deaifis helped us resolve every single case involving the recovery of premiums… Al Saqr National Insurance Company Manager – Legal Department, Amer Shatnawi
for the growing number of millionaires, according to a report. It predicts that, despite the eurozone crisis, spending on luxury goods will hit $1.5 trillion this year. Luxury sales have boomed in the last two years as the industry recovered from the hiatus caused by the 2008 financial crisis, which
We deal with them almost every day on everything from labor issues to major contracts. Tech Group CEO, Ali Ghaleb Jaber
provoked a sharp fall in conspicuous consumption. The sector has also been buoyed by the growing number of millionaire shoppers in markets such as China and Brazil, who are picking up the slack as consumers in traditionally important luxury markets such as western Europe, Japan and the US continue to spend more cautiously. The business of providing luxury experiences – from art auctions
I have no hesitation in saying that such perfect performance achieved is possible… because of the commitment and keen participation of the officials of Deaifis… China Harbour Engineering General Manager, Li Guowei
to exclusive travel packages – is now worth $770 billion according to the study. BCG predicts a seven per cent increase in luxury spending this year. The growth of the middle class in emerging markets getty images
such as China, Brazil and Russia are turning major cities into powerful luxury hubs and their residents are a shopping force abroad. BCG says that by 2020, 330 Chinese cities will have the same level of disposable income Shanghai had in 2010.
Finance I Hospitality I Property I Telco I Transport Advocates & Legal Consultants ﻣﺤﺎﻣﻮن وﻣﺴﺘﺸﺎرون ﻗﺎﻧﻮﻧﻴﻮن
Dubai t + 971 4 342 5552 | Sharjah t + 971 6 572 5003
Spain’s Olive Oil Dilemma Olive oil is the loss leader par excellence of Spanish supermarkets. “In Argentina, Chile and China there are immense plantations with the olives grown on espaliers so they can be harvested mechanically,” says Pere Sole on his farm at La Bisbal del Penedes in Catalonia. “We can’t compete with that.” He explains that it costs him ¤2.70 to REUTERS
produce a litre of oil with a market value
Bumper harvests, competition from emerging markets and a supermarket price war have pushed olive oil prices to a 10-year low. Spain’s boutique labels are still thriving, but the future is bleak for volume producers.
of ¤2.50. To add to Spanish troubles, in February the European Union lifted import tariffs on Moroccan olive oil, putting it in direct competition with Spain. Agustin Martinez, spokesman for the Andalusian small
IN HORTA DE SANT JOAN IN
farmers’ federation, said the freeing up of
Tarragona there is an olive tree known
countries such as China, India, Latin
Moroccan imports would lead to “thousands
locally as el Parot that has been bearing
America and Morocco,” says Luis Carlos
of small farms going out of business”.
fruit for two millennia. Revered because
Valero, an olive growers’ representative
of its great age, oil from its olives sells
in Jaen. Andalusia’s 800 olive oil
world’s olive oil, followed by Italy (18
for ¤30 a litre. But round the corner in
co-operatives sell 80 per cent of their
per cent) and Greece (12 per cent). Olive
the local supermarket olive oil retails at
product to big operators, with the result
oil accounted for ¤1.8 billion of Spanish
¤2 a litre. A combination of consecutive
that nearly three-quarters of olive oil in
exports in 2011, behind meat products
bumper olive harvests in Spain,
Spain is sold as a white label product for
(¤2 billion) and wine (¤4.6 billion).
competition from emerging countries
retailers to sell as own-label.
and a supermarket price war have
Cash-strapped consumers are
Spain produces 46 per cent of the
Pere Sole and his family are clear that producers have lost out on added value by
pushed prices down to a 10-year low that
increasingly turning to cheaper vegetable
letting their product be devalued by mass
threatens one of the country’s primary
and sunflower oils and the wholesale price
marketing, by allowing supermarkets to get
industries at a time when Spain is on the
of extra virgin oil is now less than half the
away with selling oil as extra virgin when it
edge of an economic abyss, with one in
$6,000 a ton it fetched at its peak.
exceeds the regulation 0.8 per cent acidity
“Prices for the producer have fallen
and in general by pursuing a marketing
by 50 per cent over the past five years,”
strategy equivalent to selling fine wine
Sant Joan in Jaen the olive growers are
says Josep Carles Vicente of the Catalan
in plastic bottles. Unable to compete
lamenting what would normally be cause
farmers’ union. “The reason is a price
with growers that manage thousands of
for celebration – the biggest olive harvest
war between three big supermarkets who
hectares, the trick is to be smaller and
in history. Jaen, a sparsely populated
dominate distribution in Spain.” Under
more independent. “The next stage is to
region in Andalusia, accounts for a third
Spanish competition law it is illegal to
press the olives ourselves,” says Sole.
of Spain’s olive oil output and 15 per cent
sell below cost, he says, but supermarkets
of world production. Andalusia produced
get round this by selling at a few cents
theirs there is cause for optimism,
1.3 million tons of Spain’s bumper
above the cost price without factoring in
but things look bleak for the volume
1.56-million ton 2011-12 harvest.
transport, labour or fixed capital costs.
producers of Andalusia. n
five of the working population out of a job. Some 650 kilometres south of Horta de
© GUARDIAN NEWS & MEDIA 2012
“We can’t compete with emerging
For a small, family operation like
M ESURE ET D ÉMESURE *
Rose gold Ultra-thin automatic movement Hermès alligator strap Made in Switzerland
* EXACT AND EXULTANT
LES ATELIERS PARMIGIANI ISTANBUL, MOSCOW, BEIJING, SHANGHAI LES STUDIOS PARMIGIANI PORTO CERVO, DUBAI, MUNICH HONG KONG EMPEROR WATCH & JEWELLERY | DUBAI DAMAS LES EXCLUSIVES LONDON HARRODS FINE WATCH & JEWELLERY ROOM | NEW YORK CELLINI | PARIS ARIJE ROMA HAUSMANN CONDOTTI | SINGAPORE THE HOUR GLASS | ZÜRICH GÜBELIN
Wang Jianlin, the Chinese real estate tycoon who has built up a $17 billion empire, is spending $2.6 billion to acquire North Americaâ€™s second largest movie theatre chain. Some industry analysts question this move, especially as US movie attendance hit a 16-year low. But Wang is a man who bets big and wins big, reports David Barboza.
Wang Jianlin, a rags-to-riches tycoon,
biggest in Asia. With 730 screens, it has
facing steep challenges in
is taking over AMC Entertainment, North
a 14 per cent market share in mainland
the North American movie
America’s second-largest movie theatre
China, based on company figures.
market, are taking more
chain behind Regal Entertainment. And
Now, by paying $2.6 billion to acquire
interest in China. The Walt Disney
he is promising to integrate it into a new,
AMC, the Wanda Group is extending its
Company and Marvel Studios, a division
made-in-China, global brand called the
reach globally. The deal, announced on
of Disney’s Marvel Entertainment
20 May, is still subject to the approval of
subsidiary, are producing Iron Man 3
Announcing the deal, Wang said in a
United States regulators, although there
in China; News Corporation recently
statement: “This acquisition will help
are no hints it will be blocked. With the
bought a stake in Bona Film Group in
make Wanda a truly global cinema owner.
AMC purchase from a group of private-
Beijing; and an agreement with Chinese
We share with AMC a passion for the
equity investors, Wanda will own more
authorities will allow more United States
growth of the worldwide movie industry.”
than 5,000 movie screens mostly in the
companies to distribute more movies and
Wang, 57, is regarded as one of the most
US and Canada in addition to its 86
reap a greater share of the box office in
successful Chinese real estate tycoons.
movie theatres in China. The purchase
China, the world’s biggest market.
His $17 billion empire includes huge
signifies a new era for Wang and in
commercial property developments, five-
But at least one billionaire businessman is betting that the United States movie
star hotels, tourist resorts and a film and
However, the deal has raised eyebrows
market is still the ticket to international
television production company. Wang’s
in the industry because of an apparent
success. And he is Chinese.
Wanda Cinemas movie theatre chain is the
lack of synergies between the US and
Wanda Cinemas’ movie theatre chain is the biggest in Asia and has a 14 per cent market share in mainland China. The AMC purchase will add a further 86 Chinese screens and more than 5,000 in total.
Chinese operations and falling US movie attendance even as China’s box office surges. US movie attendance fell to 1.3 billion in 2011, a 16-year low, according to Hollywood.com. HOWEVER, IT should be noted that Wang has never been scared of seizing an opportunity. In 2008, when the world’s financial crisis was in full swing, he spent five billion yuan purchasing land and way: “If everybody waits till the optimal time before making any investment, what he can earn will be an average profit. Only those braving big risks can win fat profits.” Wang is investing an additional $500 million in AMC to update the facilities, which will strengthen the company’s
© 2012 NEW YORK TIMES NEWS SERVICE
kicking off projects. Wang explained it this
Wanda Group President Wang Jianlin with AMC CEO Gerardo Lopez before the start of a media conference after an official signing ceremony in Beijing on 21 May.
In 2008, when the world’s financial crisis was in full swing, he spent five billion yuan purchasing land and kicking off projects. Wang explained it this way: “If everybody waits till the optimal time before making any investment, what he can earn will be an average profit. Only those braving big risks can win fat profits.” competition in the market. He said
headquarters in Beijing, Wang, the Wanda
new ideas to bring Americans back to
chairman, said he was pondering his
theatres, including adding business-class
next international destination: Europe.
sections. To rev up consumer awareness,
“We’re already negotiating,” he said.
he also will prod AMC to launch major advertising campaigns. He doesn’t expect big profits from this
Wanda is a private company in a nation dominated by state-owned enterprises. But the AMC deal is closely
investment within the short term, as
aligned with the Chinese government’s
updating the theatres will take at least
priorities, which include encouraging
a year. The entire effort to rebuild AMC
Chinese companies to “go global,” pushing
will take at least three years, according to
an overhaul of Chinese media and
Wang. “This is a long-term investment,”
entertainment properties and placing
he said, adding, “private equity lacks the
greater emphasis on consumer spending.
long-term vision that we have.” Companies in China are moving away
In an interview at his spacious
he would encourage AMC to consider
Policymakers in Beijing also want to bolster China’s “soft power” capabilities to
from low-cost manufacturing and going
extend its cultural influence internationally,
abroad in search of natural resources and
and the film industry is considered one
global consumer brands, part of an effort
of the most promising venues for doing
to upgrade the nation’s economy.
so. But whether Wanda, a 24-year-
Wang Jianlin made his fortune in real estate, but has since branched out. The Wanda Group currently controls nine million square metres of retail space.
old enterprise with little international
a northeastern city, and moved its
to focus on commercial property. When
experience, can make a success of such a
headquarters to Wanda Plaza in Beijing,
everybody was chasing commercial
big acquisition and create a global property
is a colossus with 17 million square metres
property, he was eyeing culture and
and entertainment brand is debatable,
of land under development or operation.
tourism – the industries that the
analysts say. “China has great entrepreneurs,” says
In 1988, Wang – who entered the army at 15, after middle school – says he left a
government is stressing and cultivating.” That few Chinese companies have
Duncan Clark, chairman of BDA China,
job as a local government official in Dalian
managed to establish global brands is of
a Beijing-based investment advisory firm.
and borrowed $80,000 to start a business
little concern to Wanda’s chairman. And
“But the question is: How will they take
he now describes as a “sprinting elephant.”
buying a stake in a company focused on
these companies international? Are they
Wang Yongping, founder of the China
a quintessentially American experience
going to be willing to learn and adapt?”
Commercial Real Estate Association,
– moviegoing – seemed hardly daunting
described the chairman of Wanda as
for a man who survived the Cultural
ONE OF the biggest experiments in
usually a step ahead of other Chinese real
Revolution, a period of social and political
this area is being undertaken by Wang,
estate barons. “He always has a vision,”
upheaval in China.
a former army officer who has turned a
said Wang Yongping, who has no relation
tiny real estate venture into a national
to Wang Jianlin. “When everybody was
strategy, Wanda is sophisticated,” said
brand. Wanda, which started in Dalian,
doing housing property, he jumped out
Wang. “We have good systems and
“In setting goals and executing a
departments. If targets are not reached,
“Some analysts have suggested that Wang’s acquisition of AMC was political, an effort to curry favour with Chinese leaders, who are pushing their nation to enhance its influence by exporting cultural products. Others contend Wang is eager to establish himself as China’s first global corporate chief.”
a yellow light goes off.” Wang usually hits his targets, he says. The company has experienced 30 per cent growth in the past year, even in a down market. And he promises that by 2015 the Wanda Group will have overall revenue of about $30 billion. Which raises the question: Why invest in the American cinema market at a time of weakness, Portfolio
when box office receipts are sluggish and American film producers are looking to China? SOME ANALYSTS have suggested that Wang’s acquisition of AMC was political, an effort to curry favour with Chinese leaders, who are pushing their nation to enhance its influence by exporting cultural products. Others contend Wang is eager to establish himself as China’s first global corporate chief. “It was simply worth it,” Wang said from the company’s operational headquarters in Beijing. “If you buy a screen in China, it costs three million yuan (about $473,500). If you buy the same screen in the US, it’s less,” he said. “This is kind of a statement deal for him,” said an executive familiar with the Wanda-AMC talks but not authorised to discuss them. “He’s coming out of China, and this is an area he has great interest in. He kept emphasising he just wants to learn how cinemas are operated in the US. It’s not just about the money.” But to pull off the deal, Wanda needed plenty of that: more than $3
With the purchase of AMC Entertainment, the Wanda Group will become a truly global brand. Wang has not ruled out buying a Hollywood movie studio, but he is currently more interested in hotels and shopping malls.
billion in cash, including $500 million it has promised to invest in AMC in North America. Financing such a big deal in a tough credit environment, and with China’s property market in a slump, was some feat. In the end, much of the cash came from China’s big, state-controlled banks. TO ENSURE the deal succeeds, Wang said he will keep AMC’s management in place with long-term pay incentives and invest heavily in renovating older American theatres in an effort to bolster revenue.
“We don’t have the strategy to go global in real estate,” he said. “But for globalisation and going out, we would like to buy hotels and hotel management companies. We also like department stores.”
twirled his thumbs – said he was focusing on targets and executing strategies, fast. Buying a Hollywood movie studio was not planned, he said, but would not rule it out. More likely targets, he said, were hotels and United States shopping malls. “We don’t have the strategy to go global in real estate,” he said. “But for globalisation and going out, we would like to buy hotels and hotel management companies. We also like department stores.” Wang said he hopes Wanda will become the world’s largest retailer by space by
Asked whether AMC would show “We knew each other and were very
2015, reaching 25 million square metres
found offensive, Wang said he would
familiar with one another,” he said. “But
(269 million square feet) from its current
not interfere with decisions by his
it was just a working relationship. There
nine million. By year-end, he expects to
was no personal relationship.” He said
have 13 million square metres.
films that the Chinese government
management team in the United States. He also dismissed speculation in China that his ties to Bo Xilai, the fallen Politburo leader who also got his start in Dalian, could harm the Wanda Group. July 2012
the government had not asked to investigate the group. Throughout the interview, Wang – who spoke calmly and quietly, and occasionally
Time will tell whether the acquisition of AMC was a shrewd move or not. But one wouldn’t want to bet against a man with Wang’s business acumen. n
INDIA’S POWER DILEMMA Despite having some of the world’s largest coal reserves, India has struggled to provide enough electricity for its growing economy, reports Vikas Bajaj.
INDIA HAS LONG STRUGGLED to provide enough electricity to light its
The power sector’s problems have
even bigger problem. His company loses three hours of power every evening. And
homes and power its industry around the
substantially contributed to a second year
all day on Wednesdays and Saturdays –
clock. In recent years, the government and
of slowing economic growth in India, to
euphemistically called “power holidays”
private sector sought to change that by
an estimated seven per cent this year, from
– it receives only enough electricity to turn
building scores of new power plants.
nearly 10 per cent in 2010. Businesses
on the lights but not enough to use its
report that more frequent blackouts have
large metal-cutting machines.
But that campaign is now running into
“It’s very frustrating,” said Murthy.
difficulties because the country cannot
forced them to lower production and
get enough fuel – principally coal – to
spend significantly more on diesel fuel to
“Power is a basic need. Everything is
run the plants. Clumsy policies, poor
run backup generators.
dependent on power.” It was not supposed to be this way. Two
management and environmental concerns
The slowdown is palpable at Sowmya
have hampered the country’s efforts to dig
Industries, a small company that makes
years ago, more than two-dozen large power
up fuel fast enough to keep up with its
metal shutters that hold wet concrete in
projects were planned near the company’s
growing need for power.
place while it solidifies into columns
workshop, but most of them have been
and beams, a crucial tool for the
scrapped or put off because India cannot
dig up enough coal to fuel them.
A complex system of subsidies and price controls has limited investment, © 2012 NEW YORK TIMES NEWS SERVICE
mining has also limited coal production.
The company, located outside the city
Murthy’s frustrations reflect a
natural gas. It has also created anomalies,
of Nellore on the southeast coast of India,
broader national problem. Analysts
like retail electricity prices that are lower
is struggling with several issues, including
say India’s economic woes could
than the cost of producing power, which
a 20 per cent increase in the price of
have been easily avoided if
lead to big losses at state-owned utilities.
raw materials and falling orders. But
policymakers had better addressed
An unsettled debate about how much
Sowmya’s manager, R. Narasimha Murthy,
problems like its electricity
of its forests India should turn over to
said the lack of reliable power was an
shortage, weak infrastructure
particularly in resources like coal and
India isn’t producing enough coal to fuel its power plants, which has resulted in power outages and slowed the economy.
and restrictive regulations. Instead,
like Andhra Pradesh, where Nellore
been importing coal, but that option has
policymakers have been distracted by
is, and in neighbouring Tamil Nadu,
become more untenable recently because
scandals and turf battles.
blackouts have become so common
India’s biggest supplier, Indonesia, has
that many factories report getting more
doubled coal prices.
“There is virtually no new investment by both the government and private
electricity from diesel generators than
sector,” said Ashok M. Advani, executive
they do from the power grid, at a cost
reserves of coal but it has not been able to
chairman of Blue Star, the biggest maker
that is roughly three times higher.
exploit it effectively, largely because a state-
of commercial air-conditioners in India. “We have such an uncertain environment.”
India has one of the world’s largest
owned company, Coal India, controls 80 A MAJOR problem is the anaemic
per cent of production. The company has
In the last year, the nation’s power
production of coal, which provides 55 per
been hamstrung by political decisions like
problem has grown acute, with the gap
cent of India’s electricity. Coal production
a policy that requires it to sell coal at a 70
between demand and supply jumping
increased just one per cent last year
per cent discount to market prices. Critics
to 10.2 per cent in March, from 7.7
while power plant capacity jumped 11
also say it has not invested aggressively
per cent a year earlier. In some states
per cent. Some electricity producers have
enough in new mines and technologies. Policy disputes have also caused problems. In recent years, coal regulators tried to open new areas to mining, but they did not coordinate their decisions with environmental regulators, who have blocked much of that mining because it would destroy dense forests. India also appears to have a lot of cleaner-burning natural gas, but it has not fully exploited those reserves either. Private firms have few incentives to do so because the government has capped
Sowmya Industries, close to Nellore, suffers from a lack of reliable power. On Wednesdays and Saturdays it receives enough electricity to turn on the lights, but no heavy machinery can be used.
the price of that fuel. “There is a huge crisis looming,” said Chandan Roy, a retired executive at a
Imported coal is unloaded at Krishnapatnam port in Nellore. Rising coal prices have made it too expensive for India to import the large fuel quantities it needs.
state-run electricity producer, the National Thermal Power Corporation. He added that potential solutions were well known but political leaders were reluctant to carry them out because it would mean raising prices for electricity and fossil fuels. For many businesses, the power shortage has become debilitating. In the southern state of Tamil Nadu, Srihari Balakrishnan, a textile factory owner, said he goes through 24,000 litres of diesel fuel on an average day to keep his operation running, spending $3,000 more than he would if power were available around the clock. “We are not able to use 20 to 30 per cent of our capacity,” he said.
A power plant under construction near Nellore. Although many power plants have been approved, few have been built as Coal India cannot guarantee the required fuel.
“We can’t use grid power for two full days Balashowry, a former member of
of the week. When we have power, we
business in a small shed nearly eight years
have a six-hour cut,” he added, using an
ago, and together the two have built it into a
Parliament for the governing Congress
Indian term for blackouts.
business with $390,000 in annual revenue.
Party, has already bought 465 hectares
They primarily supply small contractors in
of wooded and pasture land, including
said that his production could be 30 per
the Nellore area, where rice farming and an
340 hectares from the state of Andhra
cent higher if he had access to reliable
expanding port dominate the economy.
Pradesh, and has secured environmental
Murthy of Sowmya, the shutter-maker,
power. On a recent Friday afternoon, his
approval for his plant. But no bank will
Just 28 kilometres from their workshop
workers were rushing to cut metal plates
is the site of several proposed power
give him money to build it until Coal
by the end of the day. They would not be
plants that should have eliminated the
India agrees to give him fuel.
able to use the machines the next day,
need for arranging their work around the
when they would turn to welding the
plates into shutters, which can be done
“We have resources in India, but they aren’t able to do the proper thing,” he said, referring to government officials, during a
V. Balashowry, the entrepreneur behind
with conventional power from the grid
one of those power plant projects, Kineta
rather than industrial-grade power.
Power, applied for a supply of fuel from
recent interview in New Delhi. Other companies are also stuck.
Coal India four years ago. He had hoped
Reliance Power, which is controlled by the
machine here will work,” Murthy, 35, said
to be producing nearly 2,000 megawatts
billionaire Anil Ambani, says it has stopped
as he walked through his workshop. “We
of power by now, which would have
construction work on a large electricity
have to plan in advance.”
increased the electric capacity in the state
plant nearby because it can no longer afford
of Andhra Pradesh by about 15 per cent.
to buy coal from Indonesia as planned.
“When the power shuts down, no
Murthy’s brother started the shutter
GLOBAL DISTRIBUTION OF PROVEN COAL RESERVES
MURTHY’S BUSINESS suffers a double blow from such delays – he does not get enough electricity and there is less construction in the area, which means less demand for shutters. He says a couple of years ago, the company was thriving because the power shortage was not as DATA FROM BRITISH PETROLEUM
acute and government infrastructure
projects and private construction bolstered demand for its products. He now has 10 employees, down from 15 two years ago. “It was a very rapid drop-off,” he said. “Last year, we had a night shift as well.” n
SHAKING UP THE MUSIC WORLD Jeff Price, the founder of TuneCore, is one of the digital world’s most influential figures. He has no qualms in targeting the music majors and their business practices, reports Ben Sisario.
LIKE ANY BIG MUSIC COMPANY, the offices of TuneCore, a digital distributor in Brooklyn, New York, are lined with official-looking plaques certifying blockbuster record sales. But rather than the industry’s standard gold and platinum records, they are TuneCore’s own awards for its clients – like a rippled black disc representing 500,000 downloads for Nine Inch Nails – and the first sign of a company looking to challenge music’s status quo. TuneCore was founded six years ago by Jeff Price, a veteran independent label owner, as a service for artists working Portfolio
under the radar of the mainstream music industry. Without a label, most acts cannot get their music onto iTunes and Spotify, but for $50 a year TuneCore
the ways of the music business. Through
will place any album on dozens of online
aggressive posts on the company’s blog
mechanisms for paying royalties. But
services around the world and route all
with titles like “How They Legally Steal
his excitable manner – and his tendency
royalties to the artist.
Your Money,” and occasional outbursts at
to portray business disputes as pitched
industry conferences, he has established
battles between right and wrong – do not
when introduced – has made TuneCore
himself as a particularly vocal gadfly,
always endear him to his colleagues.
one of the world’s major suppliers of
denouncing its opaque accounting
music, and made Price one of the digital
systems and sometimes hurling insults at
about how artists need to get paid, usually
world’s most influential figures. In the
companies he dislikes.
some party is posturing for political
That simple model – revolutionary
© 2012 NEW YORK TIMES NEWS SERVICE
United States, TuneCore represents about
Price, a trim 45-year-old who speaks
“Typically when you hear people talk
positioning,” said Michael Robertson, a
10 per cent of the 20 million songs on
so rapidly he sometimes seems to be on
digital music pioneer who has also fought
iTunes, and it accounts for almost four
fast-forward, says his actions are a form of
the industry with his companies MP3.com
per cent of all digital sales.
advocacy in line with TuneCore’s original
and MP3tunes. “Jeff has done a fantastic
mission of serving musicians. “The plan,”
job with TuneCore. But I think his
the customers sold 600 million units of
he said in a recent interview, “was to start a
bombastic style drives people crazy and
music and earned $300 million off their
company that righted a wrong.”
doesn’t always serve him well.”
“You wake up one day and go, ‘Oh, wow,
recordings,”’ said Price, the company’s chief executive. As TuneCore has grown, it has also served as a pulpit for Price to criticise July 2012
Price has inserted himself into some
Price co-founded spinART Records
of the most contentious issues in the
in 1991, putting out music by the Pixies,
music business, like the legal obligations
the Apples in Stereo and others, and
of streaming services and the complex
learned about digital music through a gig
TuneCore will place artists’ songs on dozen of online services for a flat fee of $50.
at eMusic. By the mid-2000s, with his
“A real temptation in this industry is to
Agency, which processes music licenses
label winding down, he began to rethink
think there’s a quick fix, that all you need
in the United States. “Getting royalties
the way artists get their music for sale
is one thing to be successful,” said Travis
for international online exploitation is a
online. Rather than taking a cut of sales
Yetton, one of the Civil Wars’ managers.
problem at every level of the music industry,
and offering marketing services, as many
“For us TuneCore was great. They did the
and many folks are trying to solve it.”
distributors do, he decided to charge a flat
service we needed. But if we need them to
fee to deliver music to retailers and leave
break a band, then we are doing a bad job,
register songwriters’ works around the
the rest to the bands.
world and collect any money owed, for a
“I’m not going to promise anyone they’re
TuneCore’s publishing service offers to
one-time $50 fee and a 10 per cent cut
going to be a star,” Price said. “I am going
LAST YEAR, TuneCore expanded into
of recovered royalties, which Price says is
to promise that if you pay me a fee for the
music publishing, which deals with the
necessary given the intensive work. So far,
service, I will distribute your music to the
copyrights for songwriting. Already a
he said, he has signed up roughly 4,000
places you want it to go, and I will deal with
daunting business, publishing has become
clients and collected about $41,000.
all the hassles that come along with that.”
even more complex in the digital age, since
TuneCore can be lucrative for musicians
Recently, Price has become even more
songs that can be sold around the world in
aggressive as an artists’ advocate. In
who already have a following or can build
an instant may still have to filter through
January, after TuneCore releases were
one on their own. Major acts like Jay-Z
multiple layers of international middlemen
removed from Amazon’s download
and Keith Richards have used it, and two
before all parties are paid. As a result,
stores in Britain and Europe, he accused
clients, the rapper Hoodie Allen and the
millions in royalties sit unclaimed around
Amazon of not paying royalties properly
Americana band the Civil Wars, recently
the world; Price believes that TuneCore’s
there. In April, he lashed out against the
hit No. 1 on iTunes after extensive social-
customers may be owed up to $70 million.
streaming service Grooveshark, saying
media campaigns. But most of TuneCore’s
“This is a mighty problem to solve, and
that its executives “are immoral and could
700,000 acts – as well as the clients of
not just for the band in the garage,” said
care less about who and/or what they hurt
competing services like CD Baby and
Michael Simon, the senior vice president
as long as they make money.”
Zimbalam – have very low sales.
of business affairs at the Harry Fox
Price is far from alone in criticising Portfolio
The Civil Wars recently hit No. 1 on iTunes after an extensive social media campaign. TuneCore leaves all marketing to the artists.
TuneCore can be lucrative for artists who already have a following, such as Keith Richards.
AS MUCH as he has been criticised for his tone, Price has also shown that he gets results. He recently announced that TuneCore’s dispute with Amazon had been resolved and that its songs would be restored. (Amazon declined to comment for this article.) And however tempestuous his public exchanges with Grooveshark may be, the two sides are still negotiating. “If people don’t take Jeff seriously, they do so at their peril,” said Eric Garland, Jeff Price, the founder of TuneCore, in his Brooklyn office. Last year the company expanded into music publishing.
chief executive of BigChampagne, a media analysis firm owned by Live Nation Entertainment. “They are confusing his personality with his business.”
Grooveshark, which is being sued by all
they were owed only $500. “When
major record companies for copyright
somebody comes in and attacks us like
infringement and other issues. But his
this, that’s just intimidation,” Tarantino
flipped through a slide show of TuneCore’s
attack is perhaps the most personal.
said. “This space has worked through
successes and excitedly sketched charts
After his blog post was copied to Pho,
intimidation and extortion before, and
of how royalties are paid overseas, Price
an email discussion list about media and
we’re not going to have it.”
disputed a suggestion that his public efforts
technology, he wrote more than 15,000
When asked for a response to
Sitting in his office in Brooklyn, where he
were meant to attract new clients. “Yes, I run a business; I am not running
words in dozens of heated messages
Tarantino’s statements, Price wrote – as
defending his stance.
part of a long email including royalty rate
a philanthropy,” he said. “But I’m not
Sam Tarantino, the chief executive
charts and excerpts from correspondence
writing those things because I’m trying to
of Grooveshark, called Price’s criticism
with Grooveshark executives – that he did
get customers. I’m writing what I write
unfair. He said that Price had demanded
not know how much Grooveshark owes
because I believe it.”
$25,000 for his publishing clients but that
because it has not supplied necessary data
according to Grooveshark’s accounting
about its streams.
“Whether I had this company or not,” he added, “I’d still have a big mouth about it.” n
Many aMerican retailers are cutting back at shopping malls. Chains like Gap, Abercrombie & Fitch, Coldwater Creek and Talbot’s say they have too many stores at too many malls. Hundreds of stores are on the chopping block. Now, that pain is being seen as an opportunity – for some foreign retailers. Uniqlo, the Japanese basics brand, is starting aggressive growth plans at shopping malls that are expected to include 20 to 30 new stores a year over the next eight years. In its first move, Uniqlo, which has three stores in New York City and one opening this autumn in downtown San Francisco, has signed a lease at the Garden State Plaza mall in Paramus, New Jersey. The store will be in a space previously occupied by an Old Navy store. Other international retailers, from the low end, like Massimo Dutti and Topshop, to the high end, like the PPR brands Yves Saint Laurent, Bottega Veneta and Balenciaga, are also adding new stores in the United States.
© 2012 New York Times News service
Overall, the retail real estate market is starting to recover from the recession. Rents rose in the first quarter and retail vacancies declined for the first time since 2005 as some companies opened new stores and expanded existing ones, according to the research firm Reis. “This is a country of shopaholics,” said
RetaileRs taRget the US Uniqlo’s first foray into the American market ended badly. But now the Japanese retailer, along with other foreign brands, is eying rapid expansion, reports Stephanie Clifford.
Uniqlo is Japan’s most popular apparel retailer and a worldwide leader in casual wear. The company is now targeting the US market.
something new,” Consolo said.
Faith Hope Consolo, chairman of the
easy access to credit, fewer regulations
retail group at Douglas Elliman, who
than in some other countries, cheaper rents
is handling inquiries from retailers in
because of the recession and the promise
because it has succeeded in selling basic
Australia, New Zealand and Canada about
of getting Wall Street’s attention, she said.
and affordable clothing, a category that
opening in the US.
And many shoppers here like the panache
American companies like Gap and Old
of clothing from abroad. “It’s a fickle
Navy once dominated. But it failed in a
market here – the consumer always wants
previous effort to expand into American
Overseas companies are looking to the United States market because of relatively July 2012
Uniqlo is drawing particular attention
“Our brand is still not a household name, so we need a bigger box than some of our competitors.” shopping malls. In 2006, it closed stores in three malls in New Jersey it had opened in 2005. This time, company officials said, they have learned from their mistakes – most notably, a recognition that the Uniqlo (pronounced YOU-nee-klo) brand needed a bigger introduction in the United States. size mall locations – about 650 square
Last time, the retailer leased standard-
Although Uniqlo has reached saturation in Japan, its international division grew 68 per cent to $1.07 billion in the first half of this fiscal year.
metres each – that did not distinguish the brand from competitors. The new Garden State Plaza space, by contrast, is roughly 4,000 square metres, and it has external exposure, meaning Uniqlo’s signs can be seen from a nearby highway and the mall’s parking lot. “Our brand is still not a household name, so we need a bigger box than some of our competitors,” said Shin Odake, the chief executive of Uniqlo’s American division. Well saturated in Japan, Uniqlo is now posting most of its growth overseas. Fast Retailing, the Uniqlo parent company based in Tokyo, said sales in Uniqlo’s international division grew 68 per cent to 84.8 billion yen ($1.07 billion) in the first half of its fiscal year, from September to February. Profits increased 45 per cent to 11.4 billion yen for non-Japan stores in that period. Uniqlo posted a loss at its United States stores for that period, but analysts say the region is crucial for the company’s growth. “They need to have a competitive positioning in the world’s largest market,” said Masafumi Shoda, an analyst at Nomura Securities, in an email. Unlike other low-priced international brands, like Zara, H&M and Mango,
Floor to ceiling shelves inside Uniqlo’s flagship store in New York City. Portfolio
Chairman, president and chief executive officer of Fast Retailing Co, Tadashi Yanai, poses with the company’s new clothing line. Fast Retailing owns Uniqlo.
officer for Uniqlo’s American division, said
according to Kantar Media, with ads
the company was able to get prices that low
pushing its prices. With the promotions
because it did not change its merchandise
started, Uniqlo executives said it was time
plans based on the latest fashion fad.
to re-enter malls.
Instead, it books factory capacity in
shopping mall, there’s no reason for a
steady pace year-round, rather than
customer to buy at your store because we
rushing to produce trendy items from
are selling clothes, and it is not so much
different from the clothes that other people
“Typically in retail there’s a seasonality Uniqlo signed tennis star Novak Djokovic to a five-year contract in an attempt to increase its brand appeal among European and US-based shoppers.
“If you have just another store in a
advance, and produces garments at a
are selling,” Odake said. “So unless the
to the products you sell and therefore a
customer knows about your brand or what
seasonality to factories – when they’re
the company stands for, there is no reason
running at full capacity and when they’re
for the customer to shop at your store.”
not,” Kyogoku said. “To be able to balance
To hit the company’s stated target of
which rush fashionable items into stores
out, over 365 days a year, full capacity,
$10 billion in sales in the United States by
weeks after trends are seen on runways,
you’re able to create more efficiencies.”
2020, “we need to go where the customer
After retreating from its last foray
is, and in the United States, malls are the
Uniqlo’s clothes are simple. There is “a strong emphasis on fabrication,” said Faye
into American malls, Uniqlo took a
premier location where Americans shop,”
Landes, a retail analyst with Consumer
different approach, opening a store in
Kyogoku said. The Uniqlo executives
New York’s high-traffic SoHo district in
declined to discuss specifics about the
2006 and adding two more stores in
expansion plans, beyond saying they also
and striped basics like T-shirts, shorts
New York last year, on 34th Street and
included stores in other big American
and cashmere sweaters, available in
on Fifth Avenue. The stores, filled with
cities. The company is also working on an
a wide spectrum of colours. Uniqlo
spinning mannequins and steel and white
e-commerce site in the United States, the
emphasises high-tech fabric, for example,
decor, serve in part as an advertisement
in a moisture-wicking T-shirt it sells in
Uniqlo is best known for its solid
“Even though I think it may be too early
summer. And prices are low – T-shirts start
The company almost quadrupled its
to go to mall locations,” Shoda, the retail
at $9.90, and cashmere sweaters at $79.90.
spending on advertising in the United
analyst, said, the company “needs actual
States in 2011 versus 2010, to $8.3 million,
trials in there.” n
Yasunobu Kyogoku, chief operating July 2012
Braeburn Capital Reno, Nevada
Profits Routed Through The Netherlands
Apple offices around the world
Apple Operations International, Apple Sales International, Ireland
iTunes S.ar.l. Luxembourg
British Virgin Islands or other tax haven
SIDESTEPPING BILLIONS IN TAXES Most local and international tax codes were written before the technological revolution, which allows companies such as Apple to benefit from creative but legal accounting, report Charles Duhigg and David Kocieniewski.
PPLE, THE WORLD’S
and invest the company’s profits out of
an anonymous office in Reno – that help
most profitable technology
Reno, just 320 kilometres away, Apple
cut the taxes it pays around the world.
company, doesn’t design
sidesteps state income taxes on some of
iPhones in Reno, Nevada. It doesn’t run
© 2012 NEW YORK TIMES NEWS SERVICE
AppleCare customer service from this city.
those gains. California’s corporate tax rate is 8.84
Almost every major corporation tries to minimise its taxes, of course. For Apple, the savings are especially alluring because
And it doesn’t manufacture MacBooks
per cent. Nevada’s? Zero. Setting up
the company’s profits are so high. Wall
or iPads anywhere nearby. Yet, with a
an office in Reno is just one of many
Street analysts predict Apple could earn
handful of employees in a small office
legal methods Apple uses to reduce its
up to $45.6 billion in its current fiscal
here in Reno in a company subsidiary
worldwide tax bill by billions of dollars
year – which would be a record for any
named Braeburn Capital, Apple has
done something central to its corporate
As it has in Nevada, Apple has created
Braeburn is a variety of apple that is
strategy: It has avoided millions of dollars
subsidiaries in low-tax countries like
simultaneously sweet and tart. When
in taxes in California and 20 other states.
Ireland, the Netherlands, Luxembourg
someone in the United States buys an
and the British Virgin Islands – some little
iPhone, iPad or other Apple product, a
more than a letterbox in Luxembourg or
portion of the profits from that sale is
Apple’s headquarters are in Cupertino, California. By putting an office to collect
often deposited into accounts controlled by Braeburn, and then invested in stocks, bonds or other financial instruments, say company executives. Some profits from those investments are shielded from California tax authorities by virtue of Braeburn’s Nevada address. Since founding Braeburn in 2006, Apple has earned more than $2.5 billion in interest and dividend income on its cash reserves and investments around the globe. What’s more, Braeburn allows Apple to lower its taxes in other states because many of those jurisdictions use formulas that reduce what is owed when a company’s financial management occurs elsewhere. While Apple’s Reno office helps the company avoid state taxes, its international subsidiaries – particularly the company’s assignment of sales and patent royalties to other nations – help reduce taxes owed to the American and
The offices of Braeburn Capital, an Apple subsidiary that manages and invests Apple’s cash in Reno, Nevada.
other governments. Some profits at companies like Apple,
is now one of the US’ largest and most
iTunes S.ar.l., has just a few dozen
Google, Amazon, Hewlett-Packard and
valued industries, many tech companies
employees, according to corporate
Microsoft derive not from physical goods
are among the least taxed, according to
documents filed in that nation and a
but royalties on intellectual property,
government and corporate data.
current executive. But when customers
like the patents on software that makes
across Europe, Africa or the Middle East
The Luxembourg subsidiary, named
has remade industries, ignited economic
– and potentially elsewhere – download a song, television show or app, the sale is recorded in this small country, according to current and former executives. The country has promised to tax the payments collected by Apple and numerous other tech corporations at low rates if they route transactions through Luxembourg.
“Apple serves as a window on how technology giants have taken advantage of tax codes written for an industrial age and ill-suited to today’s digital economy.”
growth and delighted customers, it has also devised corporate strategies that take advantage of gaps in the tax code, according to former executives who helped create them. Apple, say former executives, has been particularly talented at identifying legal tax loopholes and hiring accountants who are
Taxes that would have otherwise gone to
known for their innovation. In the 1980s,
the governments of Britain, France, the United States and dozens of other nations
Even among tech companies, Apple’s rates are low. And while the company
Other times, the products themselves
for instance, Apple was among the first
go to Luxembourg instead, at discounted
are digital, like downloaded songs.
major corporations to designate overseas
rates. In 2011, iTunes S.ar.l.’s revenue
It is much easier for businesses with
distributors as “commissionaires,” rather
exceeded $1 billion, according to an Apple
royalties and digital products to move
than retailers, said Michael Rashkin,
executive, representing roughly 20 per
profits to low-tax countries than it is,
Apple’s first director of tax policy, who
cent of iTunes’ worldwide sales.
say, for grocery stores or automakers. A
helped set up the system before leaving
downloaded application, unlike a car, can
in 1999. Because commissionaires never
be sold from anywhere.
technically take possession of inventory
APPLE SERVES as a window on how technology giants have taken advantage
The growing digital economy presents
– which would require them to recognise
of tax codes written for an industrial age
a conundrum for lawmakers overseeing
taxes – the structure allowed a salesman
and ill-suited to today’s digital economy.
corporate taxation: Though technology
in high-tax Germany, for example, to sell
‘Double Irish With A Dutch Sandwich’
BY COMPARISON, Wal-Mart last year paid worldwide cash taxes of $5.9 billion
Numerous companies take advantage of loopholes in international laws to move profits around the world, dodging taxes. Many of these techniques rely on transferring profits on patent royalties to places like Ireland. Here is one technique typical of what Apple and others pioneered.
on its booked profits of $24.4 billion, a tax
rate of 24 per cent, which is about average
If the profits from the sale of a product stay in the United States, they would be subject to a federal tax of 35 percent. But if money is paid to an Irish subsidiary as royalties on patents the company owns, it can ultimately be taxed at far lower rates.
for non-tech companies. Apple’s domestic tax bill has piqued particular curiosity among corporate tax Manufacturing subsidiary
When the same product is sold overseas, money from the sale is sent to a second Irish subsidiary.
Irish subsidiary Because of a quirk in Irish law, if the Irish subsidiary is controlled by managers elsewhere, like the Caribbean, then the profits can skip across the world tax-free.
Second Irish subsidiary
At one time, a company would actually manufacture products in Ireland. But today, it’s more likely to use factories in China, Brazil or India that ship directly to consumers.
experts because though the company is based in the United States, its profits – on paper, at least – are largely foreign. While Apple contracts out much of the manufacturing and assembly of its products to other companies overseas, the majority of Apple’s executives, product designers, marketers, employees, research and development and retail stores are in the United States. Tax experts say it is
Caribbean or other tax haven The profits can land in an overseas tax haven where they are stored, invisible to authorities, for years.
therefore reasonable to expect that most of Apple’s profits would be American as well. The nation’s tax code is based on the concept that a company “earns” income where value is created, rather than where products are sold. However,
Netherlands And because of Irish treaties that make some inter-European transfers tax-free, the company can avoid taxes by routing the profits through the Netherlands …
... and then back to the first Irish subsidiary, which sends the profits to the overseas tax haven.
Apple’s accountants have found legal ways
NO-TAX COUNTRY 0%
to allocate about 70 per cent of its profits overseas, where tax rates are often much lower, according to corporate filings. THE NEW YORK TIMES
Neither the government nor
N.Y. Times News Service Date: 05/01/12 computers on behalf of a subsidiary in lowGraphic Slug: APPLE-DUHIGG-BSPR tax Size: Singapore. 6.8 x 7.9 With Story: (BC--APPLE-DUHIGG-BSPR--NYT) In addition, Apple was a pioneer of
corporations make tax returns public,
an accounting technique known as the
outlays for income taxes in their annual
‘Double Irish with a Dutch Sandwich,’ which reduced taxes by routing profits through two Irish subsidiaries – today named Apple Operations International and Apple Sales International – and the Netherlands and then to the Caribbean. In 2004, Ireland, a nation of less than five million, was home to more than one-third of Apple’s worldwide revenues, according
“Apple was a pioneer of an accounting technique known as the ‘Double Irish with a Dutch Sandwich,’ which reduced taxes by routing profits through two Irish subsidiaries – today named Apple Operations International and Apple Sales International – and the Netherlands and then to the Caribbean.”
and a company’s taxable income often differs from the profits disclosed in annual reports. Companies report their cash Form 10-K, but it is impossible from those numbers to determine precisely how much, in total, corporations pay to governments. In Apple’s last annual disclosure, the company listed its worldwide taxes – which includes cash taxes paid as well as deferred taxes and other charges – at $8.3 billion, an effective tax rate of almost a quarter of profits.
to company filings. Without such tactics, Apple’s federal
HOWEVER, TAX analysts and scholars
tax bill in the United States most likely
the world on its reported profits of $34.2
said that figure most likely overstated
would have been $2.4 billion higher last
billion last year, a tax rate of 9.8 per cent.
how much the company would hand
year, according to a recent study by a
(Apple does not disclose what portion of
to governments because it included
former Treasury Department economist,
those payments were in the United States,
sums that might never be paid. “The
Martin Sullivan. As it stands, the company
or what portion are assigned to previous
information on 10-Ks is fiction for most
paid cash taxes of $3.3 billion around
or future years.)
companies,” said Kimberly Clausing, an Portfolio
economist at Reed College who specialises in multinational taxation. “But for tech companies it goes from fiction to farcical.” Apple, in a statement, said it “has conducted all of its business with the highest of ethical standards, complying with applicable laws and accounting rules. We are incredibly proud of all of Apple’s contributions.” The statement also said that Apple “pays an enormous amount of taxes which help our local, state and federal governments. In the first half of fiscal year 2012, our US operations have generated almost $5 billion in federal and state income taxes, including income taxes withheld on employee stock gains, making us among the top payers of US income tax.” The statement did not specify how it arrived at $5 billion, nor did it address the issue of deferred taxes, which the
Steve Jobs with Steve Wozniak, co-founders of Apple Computers Inc, at the debut of the Apple II computer. Wozniak attended De Anza College, a community college that is threatened by closure due to California’s budget gaps. The usage of tax loopholes is one reason for the budget shortfall.
company may pay in future years or
“The statement did not specify how it arrived at $5 billion, nor did it address the issue of deferred taxes, which the company may pay in future years or decide to defer indefinitely. But the $5 billion figure appears to include taxes ultimately owed by Apple employees.”
decide to defer indefinitely. But the $5 billion figure appears to include taxes ultimately owed by Apple employees. THE SUMS paid by Apple and other
PHOTOS: GETTY IMAGES
tech corporations is a point of contention
Apple CEO Tim Cook presents Apples’ first quarter results. Wall Street analysts believe Apple could earn $45.6 billion in its current fiscal year. It is estimated the company’s federal tax bill would have been $2.4 billion higher last year, if Apple did not make clever use of tax loopholes.
budget crisis, De Anza has cut more than
are seen by officials like Murphy as
a thousand courses and eight per cent of
symptomatic of why the crisis exists.
its faculty since 2008. Now, De Anza faces a budget gap so
“I just don’t understand it,” he said in an interview. “I’ll bet every person
in the company’s backyard. Two-and-a-
large that it is confronting a “death spiral,”
at Apple has a connection to De Anza.
half kilometres from Apple’s Cupertino
the school’s president, Brian Murphy,
Their kids swim in our pool. Their
headquarters is De Anza College, a
wrote to the faculty in January. Apple, of
cousins take classes here. They drive
community college that Steve Wozniak,
course, is not responsible for the state’s
past it every day, for Pete’s sake. But
one of Apple’s founders, attended from
financial shortfall, which has numerous
then they do everything they can to
1969 to 1974. Because of California’s state
causes. But the company’s tax policies
pay as few taxes as possible.” n
HILE MONEY POURS
foundation created from Greek shipping
out of Greek banks and
wealth that has become Greece’s largest
Europe debates whether
charitable donor in recent years.
or not Greece deserves its next handout,
Greeks from the richest to those of modest
to help shore up the nation’s finances are
means have traditionally done: pay as
mainly keeping their heads down.
little as they can in the way of taxes.
They are among the wealthiest
Many economists say the oligarchs are
Greeks – whether shipping magnates,
a big part of Greece’s economic problem,
whose tax-free status is enshrined in the
because they have capitalised on the
constitution, or the so-called oligarchs who
insular, quasi-monopolistic approach to
have accumulated vast wealth via their
business that is one reason their nation
dominance in core areas of the economy like
has long lagged the far more competitive
oil, gas, media, banking and even cement.
economies of many other eurozone nations.
Astute investors, they have been
© 2012 NEW YORK TIMES NEWS SERVICE
Mainly, though, they have done what
the people potentially in the best position
The moneyed elite in Greece have
reluctant to lend a hand to the Greek
always been secretive in nature, especially
treasury through the risky proposition
when it comes to their fortunes. Assessing
of buying government bonds. But they
the ultimate value of Greek private sector
have also been slow to dispense funds
wealth is a nearly impossible task, because
to philanthropies trying to combat the
much of the money exists offshore,
mounting social ills that their nation’s
secreted away in Swiss bank accounts
economic collapse has wrought – drawing
or invested in real estate in London and
a sharp rebuke from the head of a
Monaco. And now, with the country’s top Portfolio
Greece’s Tycoons Stay in the Background Last year, an estimated ¤8 billion ($10.2 billion) in collectible taxes were in arrears – nearly half of Greece’s budget deficit. Pressure is now mounting on the country’s rich to pay their share, report Landon Thomas and Eleni Varvitsioti.
country’s budget deficit. The nation’s tycoons have every incentive to keep their country in the euro
co-president of the Stavros Niarchos
currency union. The question is, are they
Foundation, which was set up in the 1990s
willing to bear the cost of doing so?
to put to charitable use the winnings of
“The oligarchs want to keep the euro
its shipping tycoon founder. “Everyone is
– largely because of the banks which are
saying let someone else do it, and so far
so deeply integrated in the euro system,”
I am seeing little action.”
said Costas Lapavitsas, an economist at
This January, the Niarchos Foundation,
vote-getter, the leftist firebrand Alexis
the University of London. “But they are
which describes itself as an international
Tsipras, talking more and more about
keeping quiet about it.”
charity with offices in Athens, New York
nationalising companies and industries
ILLUSTRATION: TARAK PAREKH
“I get the sense that almost nothing is being done,” said Andreas Dracopoulos,
But as children go hungry in Greek
and Monaco, said it would donate ¤100
and, in the words of his top economic
schools because their parents have no
million to a series of projects aimed at
adviser, “taxing the rich,” there is even
money with which to feed them, and the
helping Greeks cope with the economic
more incentive to lie low.
streets of Athens become home to growing
crisis. Plans include food vouchers to
Of course, the left is not alone in this
numbers of desperate, jobless people,
help destitute parents feed their children
view. “Let’s be frank – the well-off need
pressure is mounting on the country’s
and programmes to attack the growing
to pay their fair share of taxes,” Bob
rich to do what the state can no longer
epidemic of homelessness in big cities
Traa, the International Monetary Fund’s
effectively do: write cheques.
like Athens and Piraeus.
representative in Greece, said in a speech
After all, philanthropy is a Greek word.
Shipping analysts guess that the value
in Athens. Last year alone, an estimated
But with many wealthy Greeks still fearful
of Greek shipping assets alone is about
¤8 billion ($10.2 billion) in collectible
of showing their financial hand, private
$85 billion – although they hasten to add
taxes were in arrears – nearly half of the
giving to date has been relatively meagre.
that those assets underpin a substantial
debt burden of around ¤300 billion
worst years on record and was likely to
youth, among whom employment is
($380 billion) for the industry, used to
lose money in 2012.
around 50 per cent. That is why, despite
finance vessels that can cost hundreds
the slump in his business, he said he had
of millions of euros each. And in the
STILL, HE and some other shipping
slack global economy, shipping – and
billionaires say they are doing their part.
refrained from laying off workers.
shipping magnates – are feeling the pinch.
In addition to philanthropic giving,
young people,” he said. “It is giving
Thanassis Martinos, a second-generation
Martinos said it was important that
shipping heir, said his company, Eastern
wealthier Greeks contribute by providing
Another rich shipper, who insisted
Mediterranean, was having one of its
jobs for the country’s increasingly rootless
on not being identified because he did
“The biggest problem is not feeding
not want to draw attention to himself,
“What the shipping magnates are not doing, though, is paying taxes. Martinos’ company, for example, bases its fleet of tankers offshore – as do all shipping companies here – although the administrative offices are in Athens.”
said that he was providing thousands of free meals to families in and around his ancestral village. Several shippers said they had also donated to a nascent campaign being organised by the trade group that represents Greek shipowners in Athens – although its president, Theodoros Veniamis, declined to say how much money they hoped to raise. What the shipping magnates are not doing, though, is paying taxes. Martinos’ company, for example, bases its fleet of tankers offshore – as do all shipping companies here – although the administrative offices are in Athens. Greece’s income tax revenue is 7.3 per cent of gross domestic product, well below the 11 per cent average for eurozone countries, according to Eurostat. Even so, there has been little talk by recent governments or even by Greece’s financial backers about imposing taxes on shippers – a move, it is assumed, that would prompt them to take their business elsewhere. That is a blow Greece would have trouble absorbing. The shipping industry employs about 200,000 people. And it brought in ¤13 billion in foreign exchange in 2010, making it the country’s top single foreign-exchange earner. Would shipping’s special tax exclusion change under a left-wing government? It is hard to say. Euclid Tsakalotos, a top
Andreas Dracopoulos, co-president of the Stavros Niarchos Foundation, which said it would donate €100 million to a series of projects aimed at helping Greeks cope with the economic crisis.
economic advisor to Tsipras, said in an interview recently that the first thing Tsipras would do was to “tax the people that past governments have been afraid of taxing.” Martinos says such an outcome is unlikely, given shipping’s vital role in the Portfolio
“Nomikos is also building a microbrewery on Santorini, the island of his shipping forefathers. He says that he hopes to create a few jobs in the community and that he plans to contribute 50 per cent of the profit to the foundation.”
A ship is guided through Greece’s Corinth Canal. The Greek shipping industry employs around 200,000 people and brought in €13 billion in foreign exchange in 2010.
march out of the eurozone. But privately, they cannot ignore the increasingly grim economic and social environment – which is why some have bolstered their already tight security forces by hiring more bodyguards. PETER NOMIKOS, a 33-year-old shipping scion, has started a campaign to raise money from Greek businesses and individuals and then, through a foundation he set up in the United States, use those funds to buy back as many of Greece’s deeply discounted bonds on the open market as possible. The plan would be to retire them to help bring down the country’s
It is expected that Greece’s tourism industry will fall 10 to 15 per cent this year, fuelled by economic uncertainty. Tourism accounts for one in five jobs and is vital to the country’s economy.
staggering debt burden, which is now ¤350
economy. Greek shippers are also some
on Santorini, the island of his shipping
of the country’s largest investors, owning
forefathers. He says that he hopes to
large tracts of real estate and interests in
create a few jobs in the community and
tourism, banking and media.
that he plans to contribute 50 per cent
Nomikos is also building a microbrewery
of the profit to the foundation.
“I don’t think the policy will change,” he
PHOTOS: GETTY IMAGES
billion – 165 per cent of the nation’s GDP.
said. “Shipping is a net profit for Greece.”
“No single person is rich enough
Many shipowners and other wealthy
to bail out Greece – not least myself,”
Greeks took the long view, correctly
said Nomikos, who through his
arguing that Greeks would come to
brewery company has already bought
their senses in the past election and not
¤100,000 worth of bonds at current
vote in large numbers for Tsipras if they were convinced that it mean a forced July 2012
Alexis Tsipras, head of the leftist Syriza party, wants an end to austerity in Greece.
rock bottom prices of around 15 euro cents on the euro. n
Challenging the Throwaway CulTure The Repair CafĂŠ consists of volunteers in the Netherlands that repair things for free. This has both an environmental and social message, reports Sally McGrane.
An unemployed mAn, A retired pharmacist and an upholsterer took their stations in Amsterdam, behind tables covered in red gingham. Screwdrivers and sewing machines stood at the ready. Coffee, tea and cookies circulated. Hilij Held, a neighbour, wheeled in a zebra-striped suitcase and extracted a well-used iron. “It doesn’t work anymore,” she said. “No steam.” Held had come to the right place. At Amsterdam’s Repair Cafe, an event originally held in a theatre’s foyer, then in a rented room in a former hotel and now in a community centre a couple of times a month, people can bring in whatever they want to have repaired, at no cost, by volunteers who just like to fix things. reduce waste, the Repair Cafe concept has
A volunteer repairs a laptop charger for a resident at the Repair Cafe in Amsterdam. The city’s Repair Cafe encourages people to bring old items, that they might have thrown away, to have them restored by expert volunteers.
Conceived of as a way to help people taken off since its debut 21/2 years ago. The
that helping people fix things was a
sawed off the vacuum’s broken nozzle. “My
Repair Cafe Foundation has raised about
practical way to prevent unnecessary waste.
husband died, and there are all these little
$525,000 through a grant from the Dutch
“Sustainability discussions are often about
things around the house that he used to fix.”
government, support from foundations
ideals, about what could be,” Postma said.
and small donations, all of which pay for
“After a certain number of workshops
to some, the project’s social benefits
staffing, marketing and even a Repair Cafe
on how to grow your own mushrooms,
are as appealing as its ecological mission.
bus. Thirty groups have started Repair
people get tired. This is very hands on,
“What’s interesting for us is that it creates
Cafes across the Netherlands, where
very concrete. It’s about doing something
new places for people to meet, not just
neighbours pool their skills and labour for a
together, in the here and now.”
live next to each other like strangers,” said
few hours a month to mend holey clothing
Nina Tellegen, the director of the DOEN
and revive old coffeemakers, broken lamps,
three per cent of its municipal waste
Foundation, which provided the Repair Cafe
vacuum cleaners and toasters, as well as at
into landfills, there is still room for
with a grant of more than $260,000 as part
least one electric organ, a washing machine
improvement, according to Joop Atsma,
of its “social cohesion” programme, initiated
and an orange juice press.
the state secretary for infrastructure and
“In Europe, we throw out so many
the environment. “The Repair Cafe is
things,” said Martine Postma, a former
an effective way to raise awareness that
journalist who came up with the concept
discarded objects are indeed still of value,”
after the birth of her second child led her
he wrote, in an email.
to think more about the environment. “It’s
“I think it’s a great idea,” said Han van
a shame because the things we throw away
Kasteren, a professor at the Eindhoven
are usually not that broken. There are more
University of Technology who works on
and more people in the world, and we can’t
waste issues. “The social effect alone is
keep handling things the way we do.
important. When you get people together
“I had the feeling I wanted to do © 2012 New York Times News service
While the Netherlands puts less than
to do something for the environment,
something, not just write about it,” she said.
you raise consciousness. And repairing a
But she was troubled by the question: “How
vacuum cleaner is a good feeling.”
do you try to do this as a normal person in your daily life?”
That was certainly true for the woman who took her 40-year-old vacuum, bought
Inspired by a design exhibit about the
when she was a newlywed, to a Tuesday
creative, cultural and economic benefits
night Repair Cafe. “I am very glad, very
of repairing and recycling, she decided
glad,” she said, as John Zuidema, 70,
“At Amsterdam’s Repair Cafe, an event originally held in a theatre’s foyer, then in a rented room in a former hotel and now in a community centre a couple of times a month, people can bring in whatever they want to have repaired, at no cost, by volunteers who just like to fix things.”
in the wake of the politically-charged killings of Pim Fortuyn, a politician, in 2002, and Theo van Gogh, a filmmaker, in 2004. “That it’s linked to sustainability makes it even more interesting.” Tellegen added that older people in particular find a niche at the Repair Cafe. “They have skills that have been lost,” she said. “We used to have a lot of people who worked with their hands, but our whole society has developed into something service-based.” Evelien Tonkens, a sociology professor at the University of Amsterdam, agreed. “It’s very much a sign of the times,” said Tonkens, who noted that the Repair Cafe’s anti-consumerist, anti-market, do-itourselves ethos is part of a more general movement in the Netherlands to improve everyday conditions through grass-roots social activism. “It’s definitely not a business model,” Postma said. She added that because the Repair Cafe caters to people who find it too expensive to have their items fixed, it should not compete with existing repair shops. The Repair Cafe Foundation provides interested groups with information to help get them started, including lists of tools, tips for raising money and marketing materials. Postma has received inquiries
The Repair Café idea has spread across the Netherlands. Besides sustainability, the movement also has a social element that brings people together.
from France, Belgium, Germany, Poland,
the raw materials reused (although not
because they’re poor. Others look well-
Ukraine, South Africa and Australia.
necessarily repaired ad nauseam), also
off, but they are aware of environmental
inspired Postma. “The value of the Repair
concerns. Some seem a little bit crazy.”
Tijn Noordenbos, a 62-year-old artist in Delft, started a Repair Cafe there four
Cafe is that people are going back into
Theo van den Akker, an accountant
months ago. “I like to repair things,” he
a relationship with the material things
by day, had taken on the case of the non-
said, noting that the repair shops of his
around them,” McDonough said.
steaming iron. Wearing a T-shirt that
younger days have all but vanished. “Now, if something breaks, you take it back to the store and they say: ‘We’ll send it to
Take, for example, Sigrid Deters’ black H&M miniskirt with a hole in it. “This cost five or 10 euros,” about $6.50
read “Mr. Repair Cafe,” van den Akker removed the plastic casing, exposing a nest of multicoloured wires. As he did, Held
the factory and it costs you ¤100 just to
to $13, she said, adding that she had not
and van der Rhee discussed the traditional
check out the problem. It’s better if you buy
mended it herself because she was too
Surinamese head scarves that Held, who
a new one.”’
clumsy. “It’s a piece of nothing; you could
was born in Suriname, makes for a living.
William McDonough, an architect, said, “What happened with planned obsolescence is that it became mindless –
throw it out and buy a new one. But if it were repaired, I would wear it.” Marjanne van der Rhee, a Repair Cafe
When van den Akker put the iron back together, two parts were left over – no matter, he said, they were probably not
just throw it away and don’t think about
volunteer who hands out data collection
that important. He plugged the frayed
it.” His “cradle to cradle” design philosophy,
forms and keeps the volunteers fortified
cord into a socket. A green light went on.
which posits that things should be built
with coffee, said: “Different people come
Rusty water poured out. Finally, it began
so that they can be taken apart and
in. With some, you think, maybe they come
to steam. n Portfolio
Expertise that promises safety Care that guarantees
The Anesthesiology Department at American Hospital Dubai We believe that our patients deserve the most practical yet personal medical care. That is why we have equipped our Anesthesiology Department with recognized experts as well as leading-edge technology and facilities. Ensuring that you always feel confident and peaceful about your treatment at American Hospital Dubai. • Pre-surgery anesthesia consultations • Elective and emergency surgery anesthesia MOH 1623/2/7/31/7/12
• Obstetrical anesthesia (spinal and epidural) • Sedation for radiology/MRI/CT • Acute and chronic pain consultation
For more information, please call +971-4-377-6553
w w w. a h d u b a i . c o m The first hospital in the Middle East to be awarded Joint Commission International Accreditation (JCIA) The first private laboratory to be certified by the College of American Pathologists (CAP)
The New PriNce of L’oreaL Jean-Victor Meyers, Liliane Bettencourt’s 25-year-old grandson, now has a seat on the 14-member board that runs the French cosmetics giant, reports Liz Alderman.
Jean-Victor Meyers has succeeded his grandmother on the L’Oreal board. Portfolio
members of the Bettencourt
me,” Meyers, with dark, gelled hair, a black
family owns through a holding company.
family, heirs to the vast L’Oreal
suit and an easy smile, said on a video
(Nestle, at just under 30 per cent, is the
cosmetics fortune, strode into the Palais
L’Oreal beamed over the stage to persuade
des Congres de Paris, the grand convention
shareholders to approve the transition.
centre, for a meeting with L’Oreal
“My first thought is of my grandmother.”
ne rainy morning in April,
© 2012 New York Times News service
shareholders. One person was missing
“This is a very important moment for
His entree onto the 14-member board,
play for the 30 per cent of the stock the
Whether Meyers, who has so far worked as a salesman at a Louis Vuitton store and an assistant product manager at
from their entourage: Liliane Bettencourt,
as the youngest administrator at any
L’Oreal’s Yves Saint Laurent cosmetic
the wizened matriarch of L’Oreal and one
publicly listed company in France, comes
line, can stand tall in Bettencourt’s stead
of the world’s richest women. Bettencourt,
at a pivotal time for the family and for
is foremost in people’s minds. He has a
89, had stayed behind in her mansion in
L’Oreal. The owner of the Body Shop,
degree in management.
the Paris suburb of Neuilly, having given
Lancome, Maybelline and an eye-popping
“But he’s only 25 years old, he’s
up the board seat she held for 17 years
list of beauty products found in bathrooms
inexperienced, and he seems to lack
after a bitter family fight that captivated
around the world, L’Oreal rang up a record
maturity,” said Cathy Boutard, a longtime
France and even shook the office of Nicolas
¤20 billion in global sales last year, and
shareholder who donned a red coat and
Sarkozy, the French president who in May
it is angling to conquer one billion new
Chanel pearl earrings for the meeting. “We
lost an election to Francois Hollande.
consumers in the next decade to beat
all miss Madame Bettencourt, and we have
followed the scandal that’s happened with
Taking her place was a willowy figure,
Stalking that news, though, is the
the family and that’s rocked L’Oreal,” she
old grandson, a sheltered, publicity-shy
question of whether Nestle, the mighty
added. “It feels like she was pushed out,
scion with a taste for fashion but little
Swiss food empire that in a longstanding
and it’s shocking.”
experience in business affairs. His main
alliance with the Bettencourts owns a big
qualification is his family name.
stake in L’Oreal, might one day make a
Jean-Victor Meyers, Bettencourt’s 25-year-
A L’Oreal researcher tests hair products and dye formulas at the company’s laboratory near Paris.
On the stage, Jean-Paul Agon, the chief executive of L’Oreal, hailed Bettencourt’s lifetime involvement in the company, which her father, the chemist Eugene Schueller, founded in 1909 after concocting a new type of hair dye in Paris. Agon said the succession showed “the engagement of the Bettencourt-Meyers family,” now in its fourth generation. Meyers, who will sit on the board alongside his parents, insists he’s ready. “I may be only 25 years old,” Meyers said. “But I’m sure of my experience with the family.” For years, Meyers has been thrust into the role of diplomat between his grandmother and his mother, Francoise Bettencourt-Meyers, whose maneuvers to keep a playboy photographer and others away from Bettencourt’s ¤20 billion fortune erupted into a Balzacian scandal that became known in France as “l’affaire Bettencourt.” Several years ago, the daughter grew suspicious that people in her mother’s entourage were trying to profit from her. She was especially wary of photographer Francois-Marie Banier, 64, a dandy who befriended celebrities including Salvador
discovered that her mother was investing in a gambling company at the behest of one of her lawyers, who has since been fired, she pressed for legal guardianship. Bettencourt exploded and declared herself ready for “nuclear war.” Since then, Banier and de Maistre have been dragged through the courts. Banier was indicted in December on charges he abused Bettencourt’s weakness, and de Maistre has been in jail since March as judges investigate accusations that he abused his position as Bettencourt’s adviser. Bettencourt-Meyers was made her mother’s legal guardian. Meyers, who is close to his grandmother and watched the events with dismay, now watches over her health and personal life after a judge determined he was the only one who could “ward off all conflict Jean-Paul Agon, chief executive of L’Oreal, has welcomed Jean-Victor Meyers to the board.
Dali and Johnny Depp, and whose
frets that Banier had grown demanding,
friendship with Bettencourt deepened after
asking her to “give me this, give me that.”
her husband’s death in 2007.
Other parts of the tapes raised
between Liliane Bettencourt and Francoise Bettencourt-Meyers.” Meyers’ ascent to the L’Oreal board – where mother and daughter had passed each other in a frosty silence during
allegations that even reached the Elysee
their Cold War – may not change much:
billion in gifts on the man she called her
Palace, the official residence of the
The family always votes in unison, and
“enfant cheri,” including annuities, Picasso
president of France. With their outsize
decisions are swayed by Bettencourt-
and Matisse paintings and an island in the
influence, L’Oreal and the Bettencourts
Meyers and her husband, Jean-Pierre
Bettencourt lavished more than ¤1
Seychelles. Banier also received a 700,000 euro-a-year contract from L’Oreal as “an artistic consultant.” The matter boiled over in 2007, when the daughter, Bettencourt-Meyers, sued Banier, saying he exploited her mother’s frailty. That set off an incendiary five-year
“With their outsize influence, L’Oreal and the Bettencourts have always helped grease French political wheels.”
Meyers, who consult each other regularly on family and business matters. The son, despite his role as buffer between mother and grandmother, is close to his parents and seems unlikely to raise boardroom challenges. Besides, the younger Meyers is more interested in fashion: He is pouring his energy into his startup
battle in which Bettencourt unleashed
men’s label, Exemplaire, selling high-end
counterattacks to keep her daughter from “obsessively” meddling in her life, and at
have always helped grease French political
one point threatened to disinherit her.
wheels. Erik Woerth, then Sarkozy’s labour
cashmere sweaters and leather bags.
minister, resigned last July after the tapes
Meyers declined requests for an
worried that Bettencourt, who had an early
showed de Maistre had arranged to send
interview. But during a short conversation
form of Alzheimer’s disease, was being
him a large donation for Sarkozy’s political
at the Palais de Congres, he said he
duped gave the police in 2010 more than
party in 2007.
was proud to take on the role. “My
Suspicions hardened when a butler who
21 hours of secret recordings he had made
Mother and daughter called a truce in
grandmother is very pleased about my
in her Neuilly home. In them, Bettencourt’s
2010, around the same time Bettencourt
entree, next to my mother and my father,
wealth adviser, Patrice de Maistre, is heard
learned her advisers had lost $22 million
onto the L’Oreal board,” he said later in
telling her that she had given her island to
by investing in Bernard Madoff ’s Ponzi
emailed responses to questions. “I’ll bring
Banier. “I wanted to give him an island?”
scheme. But the peace was short-lived:
energy and enthusiasm to L’Oreal.”
she asks de Maistre. Later, Bettencourt
Last October, as Bettencourt-Meyers
In 1963, L’Oreal stock was sold on Portfolio
Jean-Victor Meyers with his grandmother, Liliane Bettencourt.
Jean-Paul Agon stands in front of a display stand at the L’Oreal headquarters in Clichy. The company’s stock value has increased by more than 750 per cent since 1963.
Nestle to take an indirect holding in
“In the next 10 years we will have
L’Oreal in 1974, fearful that Mitterrand,
one billion more consumers who are
then the Socialist candidate for the
questioning how they will spend their
French presidency, might nationalise it.
new money,” said Pierre Tegner, an
A pact scheduled to expire in 2014 made
analyst at Natixis bank in Paris. “Nestle
Nestle a sleeping shareholder, owning
would have a big interest in putting
29.7 per cent of the firm, and allowed the
cash on the table to increase its reach to
Bettencourts, with their 30.9 per cent,
these consumers by adding personal and
to retain control of L’Oreal through a
cosmetic care to their portfolio.”
holding company, Tethys. The move proved unnecessary, but
Nestle’s chief executive, Paul Bulcke, has recently been mounting a charm
nearly 40 years later it has put Nestle in
offensive in France and was installed on
a position to take action once the pact
the L’Oreal board as one of Nestle’s three
expires. Nestle executives have said they
are not interested in pursuing Bettencourt
Boutard, the shareholder, was alarmed.
Testing new cosmetics. A hair dye concocted in 1909 was the foundation of the L’Oreal dynasty.
shares or selling, and will not reveal their
“Putting Mr Bulcke on the board is like
intentions until 2014. Analysts say that an
putting a fox in the henhouse,” she said.
expensive cosmetics company, no matter
“L’Oreal is a national icon. We don’t want it
the Paris exchange, a gold mine for the
how profitable, does not mesh with Nestle’s
to become Swiss.”
Bettencourt family. The group’s stock
enormous portfolio of global food and
market value has increased by more than
750 times since then as the company grew
“They would be very unlikely to do
Agon said the move was not out of the ordinary. And besides, Nestle had been a steady, loyal partner of L’Oreal and the
into a behemoth, acquiring Kiehl’s, the
something that does not fit with their
Bettencourts for 40 years. Asked how
Body Shop, Biotherm – the list goes on.
strategic outlook,” said Alex Molloy, an
L’Oreal would react if Nestle grew too
analyst at Credit Suisse. “Buying L’Oreal at
interested, Agon said: “We will see.”
But if a strong performance enriched the Bettencourts and L’Oreal’s
a 30 per cent premium is good for L’Oreal’s
shareholders, it is also a reason for
shareholders, but not for Nestle’s.”
nagging questions about Nestle’s ambitions. The Bettencourts invited July 2012
But others say Nestle has every reason to want to acquire L’Oreal.
In the meantime, Meyers will step into the role of defending his family’s interests. “He’s very young but clever and serious,” Agon said. “He’s a natural choice.” n
A young boy watches as his father browses a display of Nike shoes at Unknwn. Stores and brands are embracing technological change by creating new personal touches that feature gadgets rather than doting sales staff.
USING TECHNOLOGY, NOT SALESPEOPLE Younger shoppers are increasingly using technology while browsing in shops, and retailers are quick to accommodate them, reports Stephanie Clifford.
WHEN NADIA KARIM GOES
instead of getting defensive, some stores
shopping, she doesn’t wait around for
and brands are embracing the change by
salespeople. She saves items from apps
creating new personal touches that feature
and websites on her cellphone as a
gadgets rather than doting sales staff.
© 2012 NEW YORK TIMES NEWS SERVICE
shopping list. And as she browses one
Bobbi Brown has touch-screen
store – recently trying on Sam
televisions to demonstrate the perfect
Edelman flats at Nordstrom – she uses
smokey eye, something that was once
the phone to check out styles at
the exclusive domain of makeup artists.
competitors like Macy’s.
LeBron James’ shoe store in Miami has 50
“In all honesty, because I shop so much,
iPads to describe its merchandise. Macy’s
I feel sometimes I know the brands better
is testing cosmetics stations where tablets
than some of the associates,” said Karim,
offer reviews and tips. And at C. Wonder,
26, an analyst at Intel in Phoenix.
shoppers use a touchpad to personalise
For a generation of shoppers raised on
the lighting and music in dressing rooms
Google and e-commerce, the answer to
(there is also a button in case, olden-days
“Can I help you?” is increasingly a firm
style, they need to call for help).
“no,” even at retailers that have built their
The self-service theme, which started
reputations around customer service. But
years ago with checkout at groceries, has Portfolio
progressed to the point where shoppers can navigate entire stores without once having to say, “Just looking, thanks.” Companies are adding the technology now because it has become cheap enough to make it feasible and because Apple and other tablet and touch-screen makers are increasing their sales efforts. Stores also don’t want to risk losing those customers who are not content shopping from home but nonetheless prefer Pinterest recommendations, Zappos reviews and Fashism feedback to interacting with someone behind the counter. “There’s a tendency to believe that if you talk to somebody, they’re going to waste your time or sell you something you don’t need,” said Ricardo Quintero, global general manager of market development for Clinique, which uses touch screens at its counters. “It’s taking the pressure off.” IN NORDSTROM’S case, customers have surprised the retailer. Nordstrom introduced an app last autumn that executives expected people would use remotely to order items while they were watching TV or waiting for a train. In addition to that, though, customers used
Thyra McKelvie uses an iPad provided by a Nordstrom sales representative to research the shoes she has tried on.
the app while shopping at Nordstrom rather than approach the sales staff.
The plain truth, some retail analysts
“The point is not to be nostalgic for the
say, is that businesses of all sorts have no
good old days, but to ask ourselves, what
and wants service to be delivered is
choice but to accommodate consumers
kind of society do we want?” said Turkle,
changing pretty rapidly, and a lot of
who are trained to do research on their
the author of Alone Together, a book on
that is driven by technology,” said
own – and prefer doing so. Quicken
people’s relationships with technology.
Erik Nordstrom, president of stores
Loans Arena in Cleveland now gives suite
With technology replacing human
for Nordstrom. “A lot of customers
visitors an iPad so they can order food and
interaction, she said, “you’ve taken out a
like to touch and feel and try on the
drinks directly from it, while Aloft Hotels,
lot of the richness, the messiness and the
merchandise, but they also want that
a Starwood division, has installed tablets
demandingness of actually having to deal
information that they get online.”
instead of concierge stations.
“How the customer is defining service
Nordstrom has added Wi-Fi to almost
The replacement of salespeople with
Karim, the Phoenix shopper, says that
all its stores, in part so its app will work
screens is not without its detractors.
she does not avoid all salespeople, but that
fast, and is testing charging stations and
Some people worry about jobs, though
technology has given her the freedom to
clusters of iPads and computers at a few
stores say that for now they are not
be choosy. She still enjoys chatting with
stores. It does not limit what people can
getting rid of employees to accommodate
makeup-counter salespeople, for example,
do on the in-store devices, Nordstrom
their digital counterparts. And Sherry
and getting suggestions from personal
said. “It’s to have our stores be relevant, be
Turkle, a professor at the Massachusetts
a helpful place for people to be whether
Institute of Technology, said that shoppers
they’re shopping from us or stopping to
lost something intrinsic to the human
touch the fabrics, and try on shoes,” she
check their email,” he said.
experience when they avoided salespeople.
said. “It’s a social experience.” n
“It’s fun to see things in person, and
THE BEST OF LEISURE AND LIFESTYLE
VIENNA Forget coffee houses, waltzes and Freud. The real attraction of Vienna is its people who know how to live, reports Guido Duken.
efore I retired, I
I did, it is quite common for Viennese
travelled lots on
pensioners to drive taxis two afternoons
business,” said my
or so a week. My taxi driver told me
elderly taxi driver as
he did it “to break the monotony of
we drove towards
retirement, have some fun and to meet
Schonbrunn Palace. “I’ve visited every major
people.” He assured me he didn’t do it for
city in the world, but none of them come
the money, which would have made his
close to Vienna.” “What’s so special about
business travel story rather suspect.
city, but it’s also the people. Plus we have a
previous day I had checked into the Hotel
good lifestyle – music, culture, food, history,
Topazz, strategically located in the historic
nature. Vienna has everything.” He wasn’t
1st district and a stone’s throw away from
the first to tell me that during my stay in
the imposing Stephansdom (St Stephens
Vienna, nor would he be the last.
Cathedral). This 31-room, design hotel
Now before you conclude that the
pays homage to Vienna’s artistic heritage
Viennese need an attitude adjustment,
of the late 19th and early 20th century.
consider the following. For three
The exterior is something to marvel at
consecutive years (2009-2011), the human-
with its large oval windows, while the
resource-consulting firm Mercer ranked
interior is equally tastefully done.
Vienna first in its annual ‘Quality of Living’
But however alluring the hotel room
survey of hundreds of cities. The Economist
is, you won’t be spending much time in
Intelligence Unit ranked Vienna first (in a
it – not with 60 museums, cathedrals,
tie with Vancouver, Canada) for quality of
luxury shopping, music venues, dining and
life in 2005, and last year Vienna came in
famous coffee houses all within easy reach.
second, behind Melbourne. The Innovation
PHOTOS: GUIDO DUKEN
But let’s get back to quality living. The
The DO & CO Restaurant on Stephansplatz has stunning views over the city.
Sauntering through Dubai malls I’m
Cities Index, who’s scoring system covers
always struck by how repetitive the shops
culture, infrastructure and markets, ranked
are. Vienna is the opposite – especially
Vienna first in 2007 and 2008, and second
when you are walking along the ‘Golden U’,
in 2009. Plus the five million tourists who
which consists of Kärntner Straße, Graben
visit Vienna annually can’t all be wrong.
and Kohlmarkt. This central shopping
Just in case you’re wondering, because
Vienna?” “Well,” he said, “It’s a beautiful
area is seriously bad for one’s cash flow.
Lobmeyr in Kärtner Straße has been making glassware since 1823.
The wide, pedestrianised cobbled streets house everything from the standard highstreet brands to high-end brands. But the most interesting shops are the ones you’ll only find in Vienna. A case in point is the Österreichische Werkstätten in Kärntner Straße that was founded by Josef Hoffman and remains true to art nouveau styles. A handbag for my wife lightened my wallet by ¤300, but then you can only buy it in Vienna or online. There’s two ways to explore Vienna’s city centre in style: by horse-drawn carriage or in a 1958 Rolls-Royce.
Another Vienna institution is Lobmeyr, a shop famed for its crystal chandeliers Portfolio
and glassware since 1823. Andreas Rath, the affable Managing Partner, explained the history and processes behind their works of art. For example, the Lobmeyr chandelier workshop has over 10,000 cast models, which allows for the authentic recreation of every style of chandelier plus creating endless possibilities for new ideas. An interesting Middle East connection is that you will find Lobmeyr-supplied chandeliers in many mosques, including the Holy Mosque in Mecca. The items in the shop are as beautiful as they are pricey,
The Albertina Passage is a trendy dinner club that offers live jazz daily. Later in the evening it turns into a nightclub.
with the smallest chandelier starting at
But the granddaddy of all delicatessens
glass-walled VIP section right on the roof
five figures. A more affordable option
has to be Julius Meinl am Graben, an
with a stunning 360-degree panorama
for crystal-lovers is Swarovski’s Vienna
epicentre of epicurean delights that
of Vienna. We were there at sunset,
headquarter in in Kärntner Straße.
stretches over three floors and offers
the perfect time to see Vienna’s rich
more than 16,000 delicacies. Meinl’s
architecture and the Stephansdom turn
ONE THING I love about continental
Restaurant, on the first floor, is one of
orange before fading into dusk.
Europe is the bakeries and delicatessen
Austria’s top five restaurants and offers
that entice you with great smells and
tables with unique views down Graben
AFTER DARK, Vienna remains lively
amazing window displays. It’s one thing
and Kohlmarkt streets.
and cosmopolitan. Now we all know about
getting a great cup of coffee and a freshly-
Another gourmet establishment with
Vienna’s great balls and the famed Vienna
made sandwich at seven in the morning.
a view is the DO & CO Restaurant in the
State Opera, but there’s much more
It’s quite another to be served by a wide
hotel of the same name on Stephansplatz.
going on. A case in point is the Albertina
awake and friendly Viennese shopkeeper.
For an absolute treat you can reserve the
Passage, a sophisticated dinner club
situated in a former pedestrian underpass.
During my wanderings I had come
hosts had a surprise in store for us the
The dishes are a mix of international and
across the famed Loos American Bar
next evening when two 1958 Rolls-Royces
Viennese cuisine, but the daily special is
that has been in business since 1908
pulled up in front of the hotel. These two
live jazz. This is the place where Vienna’s
and is famed for it minimalist interior
classic beauties belonged to Dr Jakob
beautiful people come to play, and I’ve
and maximum atmosphere. This small,
Barnea, who started his car collection as
never seen so many tall, stunning and
crowded place counts George Clooney and
a medical student. Driving our ‘Princess-
chic women in one place. In many cities
Brad Pitt among its patrons, so it seemed
Royal’ was none other than the good
this could equal to pretentious snobbery,
the perfect spot for a nightcap. This is a
doctor himself, a jovial man who clearly
but not in Vienna. As always, everybody
place where you just squeeze in wherever
was enjoying himself. As we drove along
is warm and friendly and the mood is
there’s space, and you’ll end up making
the Ringstrasse the Viennese rush hour
upbeat. Later in the evening, when the
new friends until the early hours.
commuters looked at the car fondly, but
DJ takes over, the Albertina Passage becomes a happening nightclub.
Vienna, up to this point, had been solely explored on foot. But my Vienna Tourism
totally ignored the occupants. The same was true when we stopped at the huge Hofburg Palace that has housed some of the most powerful people in European and Austrian history. People were clicking away at the cars, while we enjoyed the sunset. Then it was off to the vineyards for a typically laidback dinner in a traditional Austrian ‘Weinstube’. Here the ethos is to eat and drink at leisure, this being as much a social event as about food. VIENNA HAS no shortage of historical figures, ranging from the Habsburgs to Johann Strauss and Dr Siegmund Freud. But one person who is seemingly
Sampling vinegars at the Naschmarkt. This market has supplied Vienna with produce since the 16th century.
unavoidable is Gustav Klimt, a prominent member of the Vienna Secession movement. Every type of cuisine is catered for at the Naschmarkt’s many restaurants.
Essentials Travel Naturally, there are also plenty of restaurants there, many with sunny outside terraces. We stopped at Orient & Occident, which whips up Turkish cuisine with an international twist. But there are plenty of alternatives. On Saturdays there’s also a fleamarket next door that sells everything under the sun. There was one more ‘must do’ tourist attraction on my agenda, and that was Schonbrunn Palace. This former 1,441room Rococo Palace is set in beautiful parklands, and everything is on such a grandiose scale that not even the numerous tour groups can fill it up. To do true justice to Schonbrunn Palace you need at least half a day, so I only got a taster during my one hour there. The controversial artist and architect, Adolf The exterior of the Topazz Hotel pays Loos, was a pioneer of modern architecture homage to Vienna’s 19th and 20th century in Vienna. He designed Loos American Bar artistic heritage. in 1903.
Definitely worth another visit. ACTUALLY, THE whole of Vienna is worth another visit. In four days, armed with the excellent planning of Austrian Tourism, I still felt like I’d barely scratched the surface. After two full days I had seen plenty of the 1st district, but by no means had I exhausted its possibilities. For one, I didn’t manage to scratch the famed Sachertorte off my to do list. In fact, I didn’t even visit one of Vienna’s coffeehouses, a sad oversight on my part. But the lasting impression – and perhaps the city’s main attraction – is the people. Everything seems to work in a laidback and fairly egalitarian way, not quite what you’d expect from a former Imperial city.
A chandelier at Lobmeyr will easily cost you five figures.
One late evening we were standing opposite the Vienna State Opera at what
After seeing Klimt exhibitions advertised
16th century, has more than 120 stands
may perhaps be the best-frequented
all over town, I decided to head to the
that offer everything from vegetables to
‘Wurstbude’ (sausage stand) in the city.
Belvedere Museum to view his most famous
cheese and seafood. But it also has some
The patrons were a curious mix of city
work ‘The Kiss’. The Belvedere Museum is
pretty unique Viennese touches, such
suits, clubbers, tourists, old and young.
housed in one of two Baroque palaces and
as the stand that specialises in vinegars
When the opera comes out, men in
has plenty of other artworks. But if art isn’t
and salad dressings. I write plural for
evening suits and ladies in all their finery
your strong suit, the architecture and the
vinegars as there is an astounding array
join the queue for a snack while dissecting
palace gardens are worth the trip.
sequestered in the small wooden barrels.
the evening’s performance. You won’t find
The stall owner is more than happy to
that in any other city, which brings me
Naschmarkt is highly recommended. This
dispense advice and let you have a taste.
back to my taxi driver. He knew what he
market, which has been around since the
Inevitably, you will buy something.
was talking about. n
For something more down to earth the
CHAMPIONS Christine Jamar-Demeersseman is internationally respected for her horse stud, which produces meticulously bred Polish Arabians that can sell for millions and are fit for kings, reports Scott Adams.
Essentials Profile Hidden away in rural Belgium,
the right body shape. They must have the
feel something and connect with the
about 100 kilometres east of Antwerp, is
special ‘look’ with big, beautiful eyes.”
animal. There are moments when you just
an outstanding horse stud run by a more
It’s hard to imagine that the handsome
know that you have a winner in front of
than outstanding female entrepreneur.
creatures in the field are assets, but at
you,” she says. “My clients say that to have
Christine Jamar-Demeersseman has
the end of the day, that is what they are.
a good eye for horses is a gift from God.”
pushed ahead in a male-dominated
They are bred to sell and in turn earn
Given that horse breeding is still a high-
arena to attract clients as diverse as
their mistress seven figure sums for their
stakes, male-dominated world, that ‘gift’
sheikhs, kings and equine connoisseurs
beauty and exquisite character. Those
– to be able to find the right combination
from around the world with her award-
traits are minutely appraised by those who
of stallion and mare – has brought her into
wish to pass on the horse’s genes to future
contact with, and gained her the respect
generations. “What people also look for in
of those who count. Her list of clients
as it is highly functional. The brick and
an Arabian is a good character,” explains
reads like a who’s who of Middle Eastern
timber-gabled mansion, which forms
Christine. “They must love people and be
royalty and her office is filled with first
the main residence for Christine and her
very gentle. In the past they used to sleep
prize trophies and rosettes marking her
husband Guy, is surrounded by stables,
with their owners in the Bedouin tents.
a state-of-the-art artificial insemination
They were part of the family.”
Jadem Arabians stud is as picturesque
Her first contact with a pure-bred
facility, covered training tracks as well
Christina is not only a top breeder, but
Arabian was at her local stables. “He
as acres of bucolic pastures, a lake and
also an experienced judge at horse shows
was such as magnificent animal,” she
forests. The resident horses spend a lot of
across Europe. “When I’m judging, I must
remembers fondly. “He captivated me with
time in the open air and it’s a grand sight to see up to 20 yearlings galloping across the fields. These equine teenagers are all youthful power and energy, but their beauty is well defined even to a novice in horses. As they come to the fence, their curious faces, with fuzzy mussels and sensual dark lashes, combined with muscular bodies and long sleek tails, make it immediately clear that they are the well thought-out work of an experienced breeder. Speaking to Christine, a feisty and clearly spoken woman, she explains that her horses sell for up to ¤4.4 million a piece. With 20 in one field, the total figure is more than impressive. “Not all of them,” she amends, “there are some which will sell for ¤500 if they don’t have a pretty face or
“They must love
people and be very gentle. In the past they used to sleep with their owners in the Bedouin tents. They were part of the family.” July 2012
Christine JamarDemeersseman owns the Jadem Arabians Horse Stud. She is internationally renowned for breeding Polish-Arabians.
his size, posture and personality.” Christine admits that her fascination with horses is in her blood. Both her great-grandfather and grandfather were keen horsemen and she followed in their footsteps while still a teenager, to become a serious show jumper. Her life as a true horse woman began back in 1978 when, her then fiancé, Guy Demeersseman bought her two Arabian mares with the idea of breeding. “I think he was worried about me getting hurt while show jumping, so working with the mares were a good compromise,” she says. After 30 years, the initial investment from her husband has paid off handsomely. “I eat, sleep and breathe Arabians,” said Christine with a broad smile. “I know I’m obsessed, but I think it’s a healthy and passionate obsession,” she muses. Her husband likes horses, but not all aspects of the life that go with it. “There is a lot of travelling involved, going to meet people, long hours attending competitions and time in the stables,” she explains. Christine certainly has drive and commitment. From those first two mares she has built the world-renowned horse stud Jadem Arabians. Walking around the property you soon realise that it’s a five star hotel for horses, a place where they are totally pampered. There are open fields for them to run in, covered exercise areas and a building dedicated solely to artificial insemination, which uses state of the art equipment and techniques. The results speak for themselves. At any one time you’ll find about one hundred horses in the stables. Half are Christine’s and the other valuable horses to her for breeding. She
Top and above: Arabians need to be perfectly proportioned, have beautiful faces and a gentle character. An imperfect Arabian can sell for €500, while a perfect specimen can fetch more than €4 million.
has specialised in Polish Arabians – a line
with the Arab world began 22 years ago.
success in the Moroccan king’s stables
of Arabians which originally came from
She was first contacted by King Hussein II
quickly spread to other royal houses in
the Turkish Ottomans in the 18th century
of Morocco. “I’m told his stud manager
the Middle East. These important clients
– and today has one of the largest Polish
followed my fortunes for eight years before
are today central to her business and have
Arabian studs in Europe.
he finally got in touch,” she confides. “We
provided the prestige she deserves. “It
half belong to customers, who entrust their
started buying and selling horses on the
was wonderful,” she remembers. “My first
this hardworking woman has carved out a
king’s behalf immediately,” she recalls with
Middle Eastern client was royalty from
place as a trusted adviser and confidante
Saudi Arabia. He had never seen a Western
In what is traditionally a man’s world,
in royal stables in Saudi Arabia, Dubai, Kuwait and Qatar. This special relationship
In the horse-breeding world, everyone seems to know everyone, and word of her
woman before and spoke hardly a word of English.” Christine sold him a beautiful Portfolio
of a horse and its breeder. The animals with the best bloodline are bought and sold for astronomical sums, are presented as lavish gifts and play a big part in oiling the wheels of business in the Middle East. It’s also a world of unlikely friendships and fiery professional jealousy. But the cementing factor is a deep love of these noble animals. There are many aspects to running the stud, but Christine’s voice softens as she speaks about her brood mares. “It’s a special moment each year when the babies are born and the mares give me this unique gift of happiness. I love the whole process, cleaning the newborn foal, then feeding and watching it grow,” she says tenderly. “I can never bear to part with my brood mares, even when they are old.” Besides breeding winners, Jamar-Demeersseman is also a respected horse judge.
One of her prize fillies at the moment
black filly belonging to the Moroccan king.
are now my sister.’ That allowed them to
is the two-year-old Glamour Girl. As she
He was delighted with the purchase and
look me in the eye and talk to me,” she
is prepared to enter the ring to be judged,
came back looking for more. “Working in
reveals. She is now everyone’s ‘sister’, and
the groom fusses around her shiny flanks
this business is a long game which requires
the situation is much more relaxed and
making sure she’s perfect. She looks
building up trust and respect for local
facilitates doing business. She admits that
beautiful with her soft mussel and large
tradition over years,” she says. She now
their mutual love of horses transcends all
lark eyes framed with long lashes. Christine
speaks rudimentary Arabic, which she says
cultural boundaries. “When the crown
comes over and wishes her ‘good luck’.
had gained her respect more than being
prince of Saudi Arabia’s mare became the
They make a grand pair, Christine with
essential for business.
world champion, his stable manager, Sheik
her blond mane, and the chestnut filly.
Mutiaq bin Mushrif, was so excited he
Both show a sense of pride, elegance and
jumped up,” she enthuses.
strength as they stand together. Christine,
The cultural differences between her own strict Catholic upbringing in Belgium and Middle Eastern ways were not so different. “In my family we all went to
Horse breeding is a world where the tiniest detail can be the making or breaking
Mass on Sundays with our heads covered and the men and women sat separately,” she explains. “At home too, there was a degree of segregation with the men doing things together and the women engaging in their own work.” On her first visits to Saudi Arabia she felt relaxed and used common sense. “I showed the men respect, I took a step back and lowered my eyes when they spoke and I avoided all physical contact, even shaking hands,” she says. Christine explains how a convenient relationship was eventually established to enable her Middle Eastern clients to deal with her easily and on equal terms. “After we had been doing business together for a couple of years, they announced, ‘You July 2012
The Jadem Arabians Horse Stud is a five-star equine hotel. There are normally around 100 horses residing at the stud.
whose life is based around creating perfect pairings, must know that already. n
Senegalâ€™S Wrestling Mania Traditional wrestling, known as laamb, has become big business in Senegal thanks to corporate sponsorships, reports Nicholas Loomis. Portfolio
the late afternoon, welcomed by musical
the stage name Yekini; and Omar Sakho,
odes and a chorus of erratic drumming.
who goes by Balla Gaye 2 – each received
Each defied his massive frame, nimbly
about $300,000, according to the local
performing the “dance of champions”
and taking measures to repel black
Such payouts are made possible
magic before stepping into the ring. The
through the sponsorship of multinational
preparations at the stadium for the fight in
corporations operating in Senegal, which
April lasted hours; the bout, mere minutes.
has experienced average annual gross
For the wrestlers and their fans, however,
domestic product growth of more than
the outcome would endure for years.
four per cent over the last 20 years. But
Although traditional wrestling exists
the country is plagued by wealth disparity.
in various forms throughout West Africa,
With nearly half of the population living
the version in Senegal, known as laamb,
below the poverty line, laamb represents
has reached unparalleled heights. Laamb
an opportunity for many young men to
ends when one of the wrestlers puts his
lift themselves, and the families they are
opponent’s head, back or both hands
responsible for, above that line.
and knees to the ground. Unlike other forms, laamb allows punches in certain matches. Those matches are the ones upon which wrestlers, spectators, sponsors, promoters, musicians and journalists descend every weekend. “We used to wrestle for the honour of the village,” said Malick Thiandoum, a sports broadcaster for Senegalese Radio and Television. “Today, with the televised events, with the sponsors who inject lots of money to have visibility, it has become a breadwinner for lots of wrestlers.”
© 2012 New York Times News service
Yahya Diop, left, who goes by Yekini, and Omar Sakho, who goes by Balla gaye 2, wrestle during their title match in Dakar. Balla gaye 2 won.
“Today, with the
televised events, with the sponsors who inject lots of money to have visibility, it has become a breadwinner for lots of wrestlers.”
The centuries-old sport began as a leisure activity for fishermen and farmers,
“I want to become a champion and a
as those with catches and crops to spare
millionaire,” said Ousmane Sarr, 23, who
would occasionally wager them on
has competed in many “simple” matches –
the outcomes. Laamb became a viable
in which punching is not permitted – but
profession around the time Senegal
only one full-contact bout. “I need to get
Many called it the biggest
achieved independence from France in
more matches with punching, then I can
match of all time. Others, just the biggest
1960; wrestlers began receiving about
stop working as a mechanic when the
of the season. Either way, it was too big
$200 for a match.
for the limited seating at Demba Diop
Today, the going rate is $100,000
Stadium in Dakar – a fact not lost on
for top-tier matches, not including the
become rich in the sport is minuscule.
those who started lining up outside at
sideshows. With appearance fees and
Of more than 3,000 registered wrestlers,
9 am, 10 hours before the main event.
kickbacks surrounding the bout in April,
only a dozen earn more than $100,000
the combatants – Yahya Diop, who uses
per combat, and those wrestlers have only
The marquee combatants arrived in July 2012
But the percentage of wrestlers who
one match per year. “There is a mirage, a sort of dream, that the youth of the country are living,” Thiandoum said. “But we are in the process of telling them, ‘Be careful, because there is a gap between what you believe and reality.’” During a season, he added, a vast majority will earn less than $2,000 in the ring, and many will earn nothing. The sport, like much of the population, is migrating from rural to urban and finding a home in the dense suburbs of Dakar – where opportunities are low. The magnitude of the recent Yekiniwhich was partly realised before the event. At a weigh-in style news conference at the luxury Radisson Blu Hotel in Dakar less
Balla match created the threat of violence, Senegalese boys perform a traditional Ekonkon wrestling dance. Wrestling is more popular than football in the African country.
than two weeks before the combat, a brawl erupted inside between the wrestlers and their entourages, and outside among their supporters – who were dispersed by tear gas when the riot police arrived. Such incidents have put the sport under greater scrutiny. Starting next season, the National Committee for the Management of Wrestling, a 13-member board under the government’s Ministry of Sport, will expand its regulatory jurisdiction from the matches alone to all aspects of laamb. The decision was a response to the hotel incident, for which it could not penalise the wrestlers under the current system. the French telecommunications giant Orange, the principal sponsor of the
Senegalese wrestling, known as laamb, was once all about the honour of villages and not big money.
Yekini-Balla bout, is also rethinking its
Senegalese subsidiary. “The sponsorship of
approach to laamb in light of the violence.
wrestling gives us an emotional proximity
After the brawl, billboards reading “the
to the Senegalese consumer.”
passion is more intense with fair play,” and
The show is not just in the ring, and
“the model of a sport without violence”
neither are the sponsors’ logos. A ticket
replaced images of the two wrestlers next
for the gala allows the fan to watch five
to the Orange logo throughout Dakar.
or six matches, which can last from a few
The company has not publicly discussed
seconds to 40 minutes (depending on
of wrestling gives us an emotional proximity to the Senegalese consumer.”
its approach for next season, except to
the wrestlers’ style and the risks they are
say that laamb is an indispensable part of
willing to take). With long breaks between
its interests in Senegal. “According to our
the matches, the traditional spectacle is
Their warm-up suits, emblazoned with
surveys, it is the most popular sport here –
part of the show – including the mystical
the Orange logo, came off to reveal magical
even more than soccer,” said Magatte Diop,
preparations, which were lavish on the
talismans called gris-gris (pronounced
director of sponsorship at Sonatel, Orange’s
day of the Yekini-Balla match.
gree-gree) as they prepared to douse Portfolio
Balla gaye 2 presents himself before his title match against Yekini. each one of the wrestlers made around $300,000 for the bout.
themselves with protective baths of varying size and colour. “The gris-gris and baths
and other elements. When it was time for the match to
everything, we risk losing everything.” His 24-year-old opponent presented
are just for protection against negative
begin, the referee, in his Orange-supplied
Yekini with a painting, a Quran and a
tongues and eyes,” said Mbaye Gueye
uniform, blew his whistle to deafening
traditional boubou, or Senegalese tunic.
Dieng, a marabout, or spiritual guide in the
roars. After two minutes, six seconds of
“Every wrestler dreams of nothing but
mystical Sufi tradition prevalent among
grappling and the occasional punch, Yekini
meeting Yekini in the ring and beating
Senegal’s Muslim majority.
suffered his first defeat in 20 professional
him,” Balla Gaye 2 said. “For what he has
matches over 15 years when Balla Gaye 2
done in the sport, I give him these gifts
their bodies for the combat, training
put the back of the 145-kilogram “King of
along with my best wishes.”
hours a day at their local facilities and
the Arena” into the sand.
Both wrestlers spent months preparing
abroad, where they have access to better
Balla Gaye 2 ran to his corner and
Not long after the match, speculation about the next one began. Another
equipment and training. But many
hugged his manager, while Yekini’s team
promoter has started planning a bout
believe that bouts are won and lost on the
went to help the fallen, visibly shocked
between Balla and the last wrestler to
champion to his feet and out of the ring.
defeat him, Eumeu Sene, who does not
“The most important preparations
On his way out, his smiling face betrayed
respect the reign of the newly appointed
are made in the home of the marabout,”
an air of relief. Yekini, 38, would later say
King of the Arena. “I am the Emperor of
Dieng said of the gris-gris containing
that he was considering retirement. “I have
the Arena,” Eumeu Sene said.
Quranic verses, the baths infused with
sacrificed my life and dedicated myself
protective bark from the local baobab tree
to my career,” he said. “In wanting to win
The revenge match is being talked up as next year’s biggest match of all time. n
E-REadERs Challenge Publishing sChedules In the past, novelists were fine writing a book a year. But E-readers are forcing authors to publish more, reports Julie Bosman.
© 2012 New York Times News service
or years, it was a schedule as
novellas or even an extra full-length
deal,” said Lisa Scottoline, a best-selling
predictable as a calendar: Novelists
book each year. They are trying to satisfy
author of thrillers. “You could saturate the
who specialised in mysteries,
impatient readers who have become used
market. But today the culture is a great big
thrillers and romance would write one
to downloading any e-book they want at
hungry maw, and you have to feed it.”
book a year, output that was considered not
the touch of a button, and the publishers
only sufficient, but productive.
who are nudging them toward greater
publishers and booksellers are desperately
productivity in the belief that the more
looking for ways to hold onto readers being
metabolism of book publishing. Authors
their authors’ names are out in public, the
lured by other forms of entertainment,
are now pulling the literary equivalent of
bigger stars they will become.
much of it available nonstop and almost
But the e-book age has accelerated the
a double shift, churning out short stories,
“It used to be that once a year was a big
The push for more material comes as
instantaneously. Television shows are rushed Portfolio
“Some of the extra work is being pushed by authors themselves, who are easing their own fears that if they stay out of the fickle book market too long, they might be forgotten.” online only hours after they are originally broadcast, and some movies are offered on demand at home before they have left theatres. In this environment, publishers say, producing one book a year, and nothing else, is just not enough. At the same time, the internet has allowed readers to enjoy a more intimate relationship with their favourite authors, whom they now expect to be accessible online via blogs, Q and A’s on Twitter and updates on Facebook. Some of the extra work is being pushed
Author Lisa Scottoline, who writes thrillers, is producing more books a year to satisfy readers who are increasingly used to on-demand entertainment.
are published in digital-only format, an
Even John Grisham is working overtime.
by authors themselves, who are easing
increasingly popular strategy to drum up
Grisham, who used to write one book
their own fears that if they stay out of the
attention for the coming publication of
each year, now does an additional series
fickle book market too long, they might
aimed at middle-grade readers, the
be forgotten. Scottoline has increased her
Child’s first story, a 40-page exploration
popular “Theodore Boone” novels that are published annually.
output from one book a year to two, which
of Reacher as a teenager, was released last
she accomplishes with a brutal writing
August, several weeks before his latest novel
schedule: 2,000 words a day, seven days a
came out in print. On the advice of his
short story, timed six to eight weeks before
week, usually “starting at 9 am and going
publisher, he is planning to write another
a big hardcover comes out, can entice new
until Colbert,” she said.
digital-only short story this summer.
readers who might be willing to pay 99
“Everybody’s doing a little more,” said Child,
cents for a story but reluctant to spend $14
who created the indelible character
who is published by Delacorte Press, part
for a new e-book or $26 for a hardcover.
Jack Reacher, is now supplementing his
of Random House. “It seems like we’re all
That can translate into higher preorder
hardcover books with short stories that
running faster to stay in the same place.”
sales for the novel and even a lift in sales of
The British thriller writer Lee Child,
Publishers say that a carefully released
older books by the author, which are easily accessible as e-book impulse purchases for consumers with Nooks or Kindles. Jennifer Enderlin, the associate publisher of St. Martin’s Paperbacks, said the strategy had worked for many of her authors, who saw a big uptick in hardcover sales, book over book, once they started releasing more work. “I almost feel sorry for authors these days with how much publishers are asking of them,” Enderlin said. “We always say, ‘How about a little novella that we can sell for 99 cents?”’
ThaT has replaced a carefully plotted print publication system, when readers waited eagerly for the yearly release of a favourite author’s novel. At that rate, publishers reasoned, readers would never
Al Roker and John Grisham appear on NBC News’ Today show. Grisham, who used to write a book a year, now also does the ‘Theodore Boone’ novels.
be overwhelmed by content.
for his Kindle.
Today’s readers seem incapable of being
There is “no limit” to the number of
like reclusiveness, which once created an aura of intrigue around an author, is not a
Child’s books he would buy, Schiefelbein
viable option in the age of interconnectivity.
said. “I’ll give basically anything he
“Particularly now with social media,
Oregon, wrote an enthusiastic review in
writes a chance,” he wrote. “With my
authors are constantly in contact with their
April on Amazon.com of Second Son, a
favourite authors, I always want to read
fans in a way that they never were before,”
short story by Child that Schiefelbein read
more from them.”
said Liate Stehlik, the publisher of William
overwhelmed. Scott Schiefelbein, a lawyer in Portland,
after buying his latest novel, The Affair,
Some of the biggest authors have become
HarperCollins. “Now it seems to make more
impossible act to follow. Airport bookstores
sense to have your author out in the media
these days can feature not just one stack of
consciousness as much as you can.”
James Patterson books, but an entire rack
only short stories for the money. Advances
time. Patterson produced 12 books last year,
are typically not part of the bargain, and
aided on some titles by co-writers. He will
the works are priced so low (usually $0.99
publish 13 this year.
or $1.99) that they don’t produce much
looked at what James Patterson is doing and realised, ‘I may not be able to publish
revenue, even if they take several weeks or months to write. But some authors said that even
nine books a year, but certainly I can do
though they are beginning to accept them
two,’” said Brian Tart, the publisher of
as one of the necessary requirements of
Dutton, an imprint of Penguin. “They were
book marketing, they still find them taxing
able to grow him and grow the readership
using that strategy.” (The new expectations do not apply to geTTY imAges
Authors don’t seem to be writing digital-
of them, sometimes more than six titles at a
“A lot of publishers and authors have
Thriller-writer Lee Child is supplementing his hardcover books with short stories that are published in digital-only format.
Morrow, Avon and Voyager, imprints of
so productive that they are nearly an
“I have been known to be a little grumpy on the subject sometimes,” said Steve Berry,
literary novelists like Jeffrey Eugenides
a popular thriller writer who writes short
and Jonathan Franzen, who can publish a
stories that are released between books. “It
new novel approximately every decade and
does sap away some of your energy. You
still count on plenty of high-profile book
don’t ever want to get into a situation where
reviews to promote it.)
your worth is being judged by the amount
Publishers also believe that Salinger-
of your productivity.” n Portfolio
Kenya’s Green Power Plan The Lake Turkana Wind Power project aims to provide reliable, low-cost wind power to the Kenyan national grid, allowing the country to reduce its dependency on hydroelectric power and oil, reports Clar Ni Chonghaile.
enya’s remote turkana region was briefly a top Twitter
Somewhat ironically, as Kenya dreams
largest windfarm. Construction on the ¤582 million
of joining Africa’s oil giants, the arid
Lake Turkana Wind Power project
Oil said it had struck oil in one of the east
region surrounding the jade waters
(LTWP) is due to start in June, pending
African country’s poorest areas. The news
of Lake Turkana is already poised to
the finalisation of risk guarantees from
prompted a flurry of #TurkanaOil tweets
make a serious contribution to Kenya’s
financial institutions IDA and MIGA,
with some predicting a windfall but many
ever-growing energy needs with the
both part of the World Bank, according to
others wondering whether oil would be a
construction of sub-Saharan Africa’s
trend after British firm Tullow
© 2012 C guardian 2012
blessing or a curse.
“A total of 365 wind turbines will be erected once 204 kilometres of roads have been built or improved to allow access for trucks, which will need to make around 12,000 trips to bring materials to the area.”
megawatts, compared with 780MW in
and Kenya Power on this since August
2002, due to economic growth.
last year. They are completing their
diversifying its power sources. Kenya
the due diligence on the project. They
is the first African country to tap
are well advanced and we hope they will
geothermal power, harnessing power
have completed and reached their board
from steam released by hot rocks beneath
approvals in the next two months,” Carlo
the Rift Valley. The abundant sun and
Van Wageningen, head of LTWP, said.
wind are also being harnessed in a variety project is the most audacious, both
the largest single private investment in
because of the scale and the location. Nick Nuttall, spokesman for the
country to diversify from hydroelectric
United Nations Environment Programme
power, which provides around 60 per
(UNEP), said Kenya was among a group
cent of its electricity needs but is prone
of developing countries where UNEP had
to drought and irregular rainfall, leading
mapped potentially windy sites and ones
to blackouts and shortages that dampen
with good solar potential. He said LTWP
had plans to expand the windfarm once
Only about 18 per cent of Kenyan
of projects: of these, the Lake Turkana
by the African Development Bank, marks Kenya’s history, and should allow the
The Olkaria Geothermal Power Plant near Naivasha. Kenya generates around 180MW of geothermal energy, equal to around 15 per cent of the country’s total energy generation.
The government is committed to
internal approval processes including
The ambitious project, which is backed
Aerial view of Nabuyatom Volcano at Lake Turkana. The area has been selected for Kenya’s first windfarm.
electricity demand has risen to 1,200
households have access to power,
the first phase is under way. “Kenya has no oil or coal that has
according to the United Nations, and
been exploited to date, which means the
demand is increasing. Kenya’s peak
country is dependent on imports and
“The World Bank Group has been working with the Kenyan government
He said it was too early to comment
the vagaries of an oil price that can soar
in Loiyangalani district in north-eastern
to some $150 a barrel and drop to $40
Kenya, stretching from 450 metres at the
on what the consequences of the oil
a barrel – whereas the sun and wind are
shore of Lake Turkana to 2,300 metres
discovery in Turkana would be. “We hope
free once the upfront costs have been
above sea level at the top of Mount
and expect that the two investments can
covered,” he said.
Kulal. Because of the daily temperature
coexist without interfering with each
fluctuations, there are strong, predictable
other. We are also not sure yet on how
“Combined with the expansion of geothermal electricity generation near
winds between the lake and the desert,
Naivasha, where there is now a near-
with LTWP estimating average speeds of
term target of about 1,300MW and the
11 metres per second.
potential of solar in Kenya, which has
A total of 365 wind turbines will be
hardly been tapped yet, Kenya could
erected once 204 kilometres of roads have
become a zero-emission economy in
been built or improved to allow access for
the field of electricity generation over
trucks, which will need to make around
the coming years, by some estimates,”
12,000 trips to bring materials to the area.
said Nuttall. LTWP says it will provide 300MW
“The challenges will be many but greatest of all … is the ability to manage
of low-cost power to the national
the co-ordination of interface risks
grid, equivalent to about 20 per cent
between the six EPC (Engineering,
of the current installed electricity-
Procurement and Construction) contracts
this project is composed of to ensure
The windfarm will cover 40,000 acres
“There is no reason to suggest the windfarm in Turkana could be anything but positive for local people, especially if it generates jobs in maintenance and diversifies livelihoods either by direct employment or via the availability of clean electricity to nearby communities.”
timely completion,” Van Wageningen said.
Wind turbines already provide power in the Ngong hills, some 25 kilometres south-west of Nairobi. But the ambitious Lake Turkana Wind Power Project will mark Kenya’s first large-scale entry into wind power.
Essentials Environment Countries (Norfund).
near the discovery is to the LTWP site,”
LTWP says that the carbon credits the
project creates should earn 26 billion
Production of the first 50MW is
clean electricity to nearby communities,” said Nuttall. LTWP says the project will create 2,500
expected to start by December 2013
Kenyan shillings (¤200 million) over the
jobs during the 32-month construction
with the windfarm due to be fully
life of the project, and this income will be
period and 200 full-time jobs during
operational by late 2014. A 428 kilometre
shared with the government and invested
transmission line will be built to link the
in the surrounding community.
According to the Earth Policy Institute,
“Under our Corporate Social
wind energy developers installed a record
farm to the national grid.
Responsibility programme, we will also
41,000MW of electricity-generating
to utility company Kenya Power and it
be constructing and delivering four 33KV
capacity last year, with more than 80
says wind power will be the lowest-cost
transmission lines and substations to
countries now harnessing the wind. In
power-generation option available, along
bring power to four small towns in the
Africa, Ethiopia brought its first windfarm
with geothermal power.
area,” said Van Wageningen, adding that
online last year, and both Nigeria and
the company expected to source most
Mauritania have projects on the table.
Until now, Morocco, Egypt and Tunisia
LTWP will sell the electricity produced
The LTWP consortium is made up of Dutch firm KP&P Africa B.V.,
“There is no reason to suggest the
Aldwych International, the Industrial
have led the way, although South Africa is also believed to have substantial potential.
Development Corporation of South
windfarm in Turkana could be anything
Africa (IDC), the Industrialisation Fund
but positive for local people, especially
for Developing Countries (IFU), Wind
if it generates jobs in maintenance and
zero in 2009 to $1.3 billion in 2010 across
Power A/S (Vestas) and the Norwegian
diversifies livelihoods either by direct
technologies such as wind, geothermal,
Investment Fund for Developing
employment or via the availability of
small-scale hydro and biofuels. n
In Kenya, investment grew from virtually
Kenya powers telecommunications transmission stations in remote areas with solar power. The United Nations Environment Programme has singled Kenya out for having huge solar power potential. July 2012
A TAsTe of The seA The Portuguese have always been great seafarers and itâ€™s no wonder that they are the largest consumers of fish per capita in Europe. What is surprising is that salted cod tops the menu, reports Scott Adams.
Lisbon, like Rome, is built on seven hills.
The Lisbon Oceanarium was designed by Peter Chermayeff. The main exhibit is a 1,000 m2 tank that house around 100 species of fish.
Lisbon’s reLationship with the sea has always been its raison d’être. A nation of great seafarers, explorers and fishermen, the locals all have a strong
“Portugal holds the title of being the largest
consumer of fish per capita in Europe and the fourth world-wide.”
affinity with what lies beyond their shores. This love of the ocean manifests itself in many ways, but perhaps the
was tried with many other fish, but it was
flavoursome dishes. If you really want to
most obvious is through the city’s cuisine.
only with cod that optimal results were
understand Lisbon’s gastronomy you have
Seafood and fish dishes feature on
found. Portugal holds the title of being
to look at its history. The Portuguese were
almost all the city’s restaurant menus but
the largest consumer of fish per capita in
on the frontlines of sea exploration in the
bacalhau – cod, is the pièce de résistance
Europe and the fourth world-wide.
15th-century and travelled to India, Japan,
and a true Lisbon favourite.
Today, salted cod is a ubiquitous part of
China, South America and the Caribbean
the Portuguese diet and the number one
where they traded for cloth, gems and
fish-loving nation, cod is the only one
ingredient to many dishes explains Jorge
exotic spices with the locals. With its access
which is not eaten fresh. It’s bought dried
Mendhao, proprietor of the restaurant La
to new food stuffs, Lisbon became the
and salted. This process has been used
Casa do Bacalhau, which has been serving
epicentre of a European culinary revolution.
for over 500 years and dates back to 1497
up cod in Lisbon for over one hundred
Such delicacies as nutmeg, cloves, pepper
when the Portuguese fleet travelled around
years. “There are over a thousand written
and saffron all made their way to European
Scandinavia and discovered the cod-rich
recipes using cod, which means you could
kitchens only after they had been absorbed
waters in this northern part of Europe.
try a new dish every day for almost three
into Portuguese cuisine first.
Before refrigeration there was a need to
years without repetition,” he boasts. “We
preserve the fish, and the Portuguese were
have here on the menu over 20 recipes with
maritime explorers there are numerous
quick to discover that drying and salting it
bacalhau as the main ingredient,” he adds.
spices and condiments used in dishes that
Curiously, of all the fish eaten in this
conserved the important nutrients while making the cod tastier. The same process July 2012
Portuguese cuisine in general is characterised by rich, filling and
With the country’s abundance of
have their roots in the ‘old colonies’, such as India. Chilli, coriander and black pepper
Bacalhau, Portugal’s famous dried cod, is ubiquitous in Lisbon. There are even shops that specialise in this delicacy.
are popular additions to many dishes.
Rua Augusta is Lisbon’s lively pedestrian-only main street that is famed for its shopping.
The backdrop to all this food and eating
Extra virgin olive oil is used both for
is also highly inspiring. Much like Rome
cooking and flavouring dishes.
they call Lisbon the City of Seven Hills
Salted cod is highly visible around Lisbon.
for good reason. Wherever you go you’ll
It can be bought from just about any
be going up or down a hill, and the views
food shop. Although there are specialised
are always inspirational. From the higher
bacalhau shops, where the walls and shelves
points there are stunning vistas of the
are covered with large slabs of the white
Tagus River and the mammoth, Golden-
crystallised fish, you’ll also find it in grocery
Gate-style bridges that cross it. However,
stores and in supermarkets, where almost a
much of Lisbon’s charm comes from the
whole aisle is dedicated to it.
unexpected – a family group enjoying a
Lisbon is all about seafood. Sardines are typically served on the Feast of San Antonio in June.
“The funky decor is
calculated to attract the scene-savvy and it’s a good idea to keep an eye out for both local and international glitterati.”
Before cooking, salted cod must be
get-together in a cobblestoned square, the
rehydrated and desalinised before it can
ornately decorated façade of a nobleman’s
Gomes Da Sá – a rich mix of cod, rice and
be eaten. To do this the fish is immersed
palace or a row of brightly painted shops
potato cooked in the oven before being
in warm water, which is changed regularly
and houses in the old-quarter.
topped with chopped hard-boiled eggs and
for up to three days. Once rehydrated the
You don’t need starched white table
cod is ready to be cooked. Although there
cloths and Reidel stemware to have a great
are a myriad ways to prepare it, a large
meal in Lisbon. At the rustic-styled Toma
stiLL frequented by artistic types,
number of dishes use potatoes and onions
Lá Dá Cá you’ll find there are queues to
intellectuals and locals, Antiguo 1 de Maio
as accompanying ingredients. One of the
get a table, so it pays to go early. The menu
packs a punch for old-world ambience and
most popular recipes is Bacalhau à Gomes
covers the best classic Portuguese dishes
some of the best home-cooked Portuguese
de Sá, which is a hearty casserole with
all cooked to perfection. Of the starters,
food served in town. The two small
chunky potatoes, boiled eggs, onions, garlic
the grilled cuttlefish are a must. Second
dining rooms are decorated with original
and, of course, cod. The dish is flavoured
courses are nicely split between meat and
19th-century white and green wall tiles
with parsley, nutmeg and white pepper.
fish. Their best cod dish is Bacalhau a
and cheerful checked table cloths. Go with Portfolio
Guests at Casa Fundada. The building hails back to 1782 and houses a number of restaurants and coffee shops.
Bacalhau a Espanhola is a classic Portuguese dish made with salted cod.
an appetite as the portions are more than
cafeteria shares space on street level with
the menu. It’s Lisbon’s only Michelin-
generous. Must try dishes include clams
the establishment’s gastronomic citadel,
starred restaurant and lives up to its
with garlic sauce, roasted sardines with
the restaurant. With double height ceilings
reputation. Decorated with impressive
green beans and Cod Piri Piri, which uses a
and designer furniture, the interior is sleek
pieces of contemporary art, it opens
spicy red pepper as flavouring.
and chic, while the food takes brilliant
onto a panoramic view of the city. Chef
liberties with traditional Portuguese
Joachim Koerper’s specialties, each based
charm, it’s a city on the move and the
cuisine. Stellar examples include seafood
on market-fresh ingredients in harmony
area along the waterfront emphasises
broth with grilled red prawns and Asian
with the seasons, have received world
that point perfectly. What once was an
vegetables, cod salad in olive oil and veal
acclaim. He uses locally grown, natural
industrial area is now where the coolest
knuckle browned in olive oil, with garlic,
produce, creating a luminous, elegant
Lisbonites go. There are discos, clubs, bars
sautéed potatoes, and bay leaves.
and innovative cuisine. Starters include
While Lisbon has plenty of old-world
If you have spent the morning exploring
a foie gras terrine with banana chutney
the Tower of Belem, the Monument to the
or scallops carpaccio with black truffles.
Discoveries, the Jerónimos Monastery and
Follow on with fish dishes such as sea
trendiest restaurants but it still has
the Coach Museum, you’ll find the Vela
bass with beetroot, or roasted lobster with
bacalhau on the menu. The funky decor is
Latina restaurant nearby for a refuelling
butter beans. There is always room for cod,
calculated to attract the scene-savvy and
stop. With views of the Tagus river it’s the
and you’ll find a delicious interpretation
it’s a good idea to keep an eye out for both
perfect setting to enjoy some traditional
of a classic bacalhau recipe in the guise of
local and international glitterati. In fact it
Portuguese flavours. Specialties include
char-grilled cod with fresh parsley.
was actor John Malkovich, along with four
ravioli filled with shredded cod and tiny
Lisbon is one of Europe’s most
other partners, who transformed, what
prawns or Bacalhau Com Migas e Pão de
fascinating cities with a long association
had once functioned as a boat factory, into
Milho – a tasty casserole with chunks of
with the sea. Spending time in the
a three-part restaurant that pulls a lively
cod, bread, onions and potatoes.
restaurants discovering the cod-based
and restaurants all vying for the spending power of the city’s new affluent class. Bico do Sapato may be one of Lisbon’s
crowd virtually every night. A sushi bar is set one floor above ground level, and a July 2012
The avant-garde building where Eleven is housed is a taste of what’s to come on
cuisine is the perfect way to immerse yourself in the culture. n
KING OF THE DESERT
The 2012 Toyota Land Cruiser VXR+ is a mighty vehicle and now it offers even more luxury, reports Guido Duken.
IRST-TIME VISITORS TO the UAE tend to marvel at
who’s the real king of the desert. Black and white are the colours that
does have a plush, luxurious feel and there was no problem figuring out
dominate local Land Cruiser sales, so
the controls. There’s plenty of sitting
architecture and the sheer number of
I was pleasantly surprised when my
space both at the front and back, the
Toyota Land Cruisers on the road. Having
2012 VXR+ turned out to be a daring
leather seats are comfy, driving position
lived in the UAE for 11 years, I’d kinda
dark red Mica metallic that really
good, the wood trim tasteful and the
forgotten about the sheer popularity of
added impact. Or maybe that was due
finishing is solid. It all underlines
this 4X4. That was until I turned onto Al
to the redesigned front bumper with
the Land Cruiser’s ethos of rugged
Ain highway recently and counted eight
enlarged overhangs, the new radiator
reliability matched with class and style.
Land Cruisers around me at one time,
grill, wider wheel flares and larger
and 17 on my side of the road within a
18-inch aluminium rims that express
with a new independent double wishbone
two-kilometre stretch. Apparently the
the Land Cruiser’s power so succinctly.
type front suspension, and a new coil
two things: the glitzy modern
Emiratis call the Land Cruiser ‘Abu
Toyota has also boosted the look and
The suspension has been upgraded
spring has been inserted to enhance
Shanab’, which means ‘The Pride of the
feel of the interior, and improved the
riding comfort and the strength to
Land’. Toyota humbly says that the Land
ergonomics and functionality for the
withstand the most rigorous use.
Cruiser is “one of the most popular off-
controls and switchgear. This being
roading vehicles in the region”. Unless
my first Land Cruiser test, I’ll have to
features includes Turn Assist, which
you count camels, I say it’s no contest
take their word on it. But the interior
works in conjunction with the Crawl
Off-road, the raft of new handling
The 2012 Land Cruiser has a redesigned front bumper and radiator grill, as well as wider wheel flares and larger 18-inch aluminium rims.
Essentials Test Drive
Toyota has further improved the quality of the interior. Leather seats all round, and the two front seats are air-conditioned.
no slouch in the acceleration department, especially when you consider its 2,590kg kerb weight. Going through corners there’s that noticeable body roll that is the hallmark of all big SUVs, and there are no electronic adjustments available to firm up the suspension on the tarmac. Pity, firmer The VXR+ has tasteful wood trim and improved ergonomics. All controls are readily accessible.
suspension – especially in Sport mode – would definitely add to the driveability. But hey, let’s not carp about details. The
Control function, in addition to the five
with extras such as a remote engine
Land Cruiser started life 60 years ago as
mode Multi-terrain select (MTS) and
starter, sun roof, front fog lamps and rear
an uncomfortable rugged go anywhere
Multi-terrain Monitor. The Turn Assist
seat entertainment to list just a few.
vehicle. Today, it’s a luxurious can go just
System enhances turning ability and
First impression after pushing the
about anywhere vehicle. The essence of
minimises the driver’s effort in tight
Start/Stop button is that the Land Cruiser
the Toyota Land Cruiser is that it manages
U-turns where K-turns are necessary,
VXR+ runs very quietly. The second is
the tricky combination of off-road prowess
by applying the brake on the inside rear
that it’s a big vehicle, which makes one
and comfortable on-road driving so well.
wheel. The monitor helps drivers to
thankful for the reverse camera. The third
Plus it has plenty of space for the whole
observe their surrounds through front,
one is that the Land Cruiser is so good at
family and all the camping equipment
side and rear cameras. No more smashing
soaking up bumps and road noise that it
you need for a good desert safari.
into rocks hidden in the blind spot.
feels like a luxury sedan. Initially, I was
At Dhs305,000 the Land Cruiser VXR+
disappointed with the power. Like every
is slightly more expensive than some
line Land Cruiser with a V8 5.7-litre,
Dubai citizen, I’m used to being passed
rivals, but then it is a tried-and-tested
32-valve engine that puts out 362HP
by seemingly jet-propelled Land Cruisers.
Toyota. Oh yes, least I forget, the 2012
at 5,600rpm and 530Nm of torque at
So maybe my expectations were too high,
Toyota Land Cruiser also comes in three
3200rpm through a six-speed automatic
but once I put it into sports mode things
new colours: White, Attitude Black and
gearbox. Naturally, it also comes loaded
became a lot more exciting. The VXR+ is
Light Blue. I dare you, get the red one! n
The 2012 VXR+ is the top-of-the-
A Taxing Job
Spy Versus Spy
Gayus Tambunan, who bribed his way out of jail while awaiting conviction for taking kickbacks to
the mysterious cloak and dagger world
cut companies’ taxes.
of international espionage and its real-life heroes and villains are exposed in a new
“It is very important to build character,” said Dedi Rudaedi, a
exhibition, the first to be sanctioned by Us
spokesman at the tax office. “We
have 32,000 employees and the
“spy, the secret World of espionage,”
majority want to make a change,
includes hundreds of artefacts, some from
they want the office to be cleaner.”
the vaults of the Cia and FBi and the National Reconnaissance Office (NRO). they range
President Susilo Bambang Yudhoyono has made fighting
from a World War ii-era collapsible motorbike
Tax collecting can be a dangerous
graft a priority but progress
that could be dropped by parachute and
job, so it seems perfectly logical
has been slow and his own
deployed in 10 seconds and a german
that Indonesian tax collectors
political party is mired in several
eNigma machine used to create secret
will get three weeks of military
corruption scandals, hurting his
messages to a camel saddle used by one of
physical training from the
popularity and making corruption
the first Cia agents in afghanistan after the
president’s security forces.
a major risk for investors.
9/11 attacks to bugging devices, microdots and surveillance equipment.
Tax collection is also low
However, this is an effort to
the exhibition, which runs through march
build up the moral fibre of an
in Southeast Asia’s largest
organisation that has been
economy, limiting state revenue
2013, traces the world of international
plagued by scandal.
and reducing the ability of the
intrigue from the start of World War ii, to the
government to fund an overhaul
establishment of the first Us spying agency,
Office of strategic services (Oss), after
Indonesians were shocked last year by revelations of tax official
Japanese forces attacked Pearl Harbour in
1941, through the Cuban missile Crisis, the Cold War, the downing of Pan am flight 103 in 1988 and the september 11, 2001 attacks.
A decade of overspending has forced the Nobel Foundation to cut the prize money given to Nobel laureates by a fifth. The Nobel Foundation said the getty images
money for the awards, given for excellence in the fields of science, literature and peace, would fall to eight million Swedish crowns
past decade, making it necessary
to lower the prize money from
The capital that forms the base for the awards was donated in
the previous 10 million crowns. The foundation said it had
the will of dynamite inventor
also begun work to cut costs
Alfred Nobel and is managed by
in administration and expenses
the foundation, which was set up
related to the Nobel Prize
celebrations, which take place
The foundation said in a
every December in Stockholm
statement that costs had exceeded
and Oslo. This year’s laureates
returns from interest and
will receive the reduced prize
investments on the capital over the
EXPERIENCE RALPH LAUREN’S FIRST EUROPEAN RESTAURANT AT HIS LUXURY STORE ON THE LEFT BANK
173 boulevard Saint Germain, Paris Reservations: +33 (0)1 44 77 76 00