All posts tagged 'Sovereign Economy'

EU vs Sovereign Economic Model

The Sovereign Economic Model is a stalwart for sovereign economics of a state.

EU is a centralizing black hole: EU has such a bureaucracy in place to remove sovereignty from countries in order to create a political "union".
This overflows to economics, where the EU:

1) regulates what and which countries can do,which cannot
2) has quotas for food production (e.e. milk)
3) forbids some local foods
4) distributes economic "tasks" to EU "favourite" countries, while forbidding other countries to implement them
5) limits state capitalism (while the Sovereign Economic Model encourages it)
6) de-industrializes poorer countries by shutting down local companies
7) favours large companies with huge lobbying budgets
8) removes competition as 6)7)
9) direct support to designated companies only

Sometimes I feel pity for European countries being handicapped by EU bureaucracy, and the instalment of EU nominated companies with related loss of competitiveness, will cause the complete defeat of many industries by more eager less bureaucratic Asian countries.

Sovereign Economic Model and Japanese-style economy

One of the ways Japan build its post-war economy was a peculiar method on how they organized both internal competition and exports.

1) In the internal market, Japan applied strong protectionism to impede imports from foreign firms.
2) They selected a number of national champions (usually between 5 and 8) with a similar structure of suppliers
3) National champions competed furiously for market share, without one ever grabbing a too big share
4) As result of this fierce competition, the Japanese companies became competitive in the international market
5) The companies began to export, not individually, but as a syndicate -in a collaborative way- to gain critical mass

Japan had huge success with this stratagem. Also Keiretsu - which is a Japanese term, for a strong relationship, even mutual equity stakes between a group of companies - is a strong bond when working and trading internationally. This system is still in place in the Japanese economy.

I believe a sovereign economy should consider the Japanese method of building up entire industries, it has worked before successfully and can work now.

Sovereign Economy, Industry 4.0 and the economy of "simple things"

Very interesting articles (in Russian)

I completely agree on on the policy of restoration of the economy of "simple things" .
The economy of "simple things" is basically FMCG, plus agriculture. In many countries this “simple” economy is a bit underdeveloped as many products are, yes, produced in locally, but by foreign companies, and not local companies. It just takes a stroll in a supermarket and most of cleaning and personal care products are of foreign companies.
I believe both de-taxation and market regulation are in favour of local companies which could take over this market.