Thursday, October 09, 2008

Cambodian sweatshop

My Australian friend and I visited a workshop in Phnom Penh last weekend. We were told about this place by a young Khmer woman who told us her parents worked there cutting pieces of cloth to be made into shirts that are sold in the Olympic Market. They are paid 100 riels (2.5 cents US) for each shirt they cut.

We could not believe it and asked to be taken there. The workshop is housed in a typical Khmer terrace house, a p'tyair l'wairng that has grilles all around its compound (this is typical in Cambodia because robbery is so common). It is near the Russian Market on a street that is nondescript and dead quiet (at least in the afternoon when we visited)--there is no way of telling the house is a sweatshop where young people from the provinces, all teenagers, work for USD25 a month--for up to 19 hours a day.

We entered the house and it was bright and airy. There was a Lexus parked in the driveway and framed photographs of the Khmer family that owns the house and the workshop adorned the walls. There were even certificates--one of which said "Certificate of attendance for Workshop on the WTO agreement".

Upstairs is where the workers work and sleep. They live and eat and shower with the Khmer family that owns the place. This family also owns a shop in the Olympic Market, where the shirts made by the workers are sold. The owners were not there when we visited and we met nine people, and except for the young woman's parents, the others were all teenage boys and girls. We asked what time they work and were told 5am to 12am. I could not believe it and asked again. I asked, "Why don't you go to bed at 10pm, how will your boss know?" They told me the boss sleeps at 8pm every night in the same house and when she wakes up in the middle of the night for a pee, she will kick and beat them if she finds any of them sleeping. The boss wakes up at 5am every day and gets them up to start work.

One of the girls was ironing the shirts with a traditional iron. It is not electric and is filled with coals and is extremely heavy. She looked like she was going to fall asleep and I kept thinking how dangerous it was if she fell asleep and burnt herself. She looked really, really miserable, and I said to my friend after that how such work is absolutely soul destroying. That girl made me think of the term "the living dead".

These kids end up in shitty jobs like these because they come from the provinces and don't know any better and cannot even get a job working in a garment factory because they don't have any experience. They get sent by their families who figure it is cheaper for them to have fewer mouths to feed. In this particular workshop, the workers have no holidays except 3 days each for Khmer New Year and Pchum Ben. That means they work 359 days out of 365 a year. My friend wondered aloud how they'd have time to go shopping, or to the dentist or do anything. It's simple--they don't.

The pajamas, office shirts etc this group makes are sold to Cambodians at the Olympic Market. These range from USD3-6 an item. You go do the maths and figure out how much this Cambodian couple is making at the expense of their fellow Cambodians. Obviously enough to own a house, a Lexus and dine at fancy restaurants.

What this family is doing is illegal, since Cambodian labour laws spell out a minimum wage of USD50 for a 48 hour work week. Overtime pay is 1.5 times the normal, and 2 times should you require workers to work on Sundays and public holidays. Although illegal, no one believes the police will do anything because the rich employers can pay them off. I believe such small exploitative private businesses are common.

I have discovered Cambodians are among the worst bosses and exploiters of their own people. There is a popular Khmer-owned restaurant on Pub Street here in Siem Reap that docks USD1 from staff's pay if they are even 3 minutes late. USD1 when the average pay is USD2 a day--why even bother to turn up if you're late, I wonder? This same restaurant cuts staff's monthly pay to make up a USD100 deposit, which will be returned to the worker when he or she works for at least a year with the restaurant. If not, he/she loses the deposit. Another Khmer-owned one on Pub Street pays its waitresses USD50 a month for 9 hours a day, 7 days a week. In fact I have just offered a young waitress at this pub a job at Bloom at double the wage because I think this particular young woman deserves better. Then there are the expat owned businesses, usually co-owned with a Khmer wife, that treat staff similarly.

This is why I think there is no way for Bloom to compete in Cambodia--we need to sell our bags overseas as well. Say I opened a pub on touristy Pub Street and paid my staff double what everyone else pays. My food and drinks prices will still have to remain competitive (USD3-5 for a meal and USD 0.75 for a mug of beer) in order to attract patrons. With the higher costs, how can I be as profitable as the other pubs on Pub Street? Of course I can't. Can I be even just a little bit profitable? Perhaps, but it will take patience and commitment, not to mention deep pockets.

Of course, some customers will support us if they were told the truth, but honestly, I believe most customers will not care. They just want to stretch their dollar while on holiday. They may even justify their patronage by telling themselves that USD50 is enough for a Cambodian to live on ("It must be, right? Since they do"--Well, yes they do, but it's literally living hand to mouth in cramped quarters). This is if customers even think about it. Most people don't. They go on holiday and they pay whatever prices they find.

How can we make more people understand and care? I don't know. I think about this all the time: Why do people not care more? I have come up with a few theories:

1. Most people think: I work hard for my money, and I want bargains so I will have more money left over to pay for my house, kids' education etc.

2. Most people have hard lives themselves, hard in the emotional sense, and think "Everyone has problems; I'm certainly not responsible for theirs (the Cambodians, Burmese, Haitians etc). I'm here on holiday, to relax; not to get stressed over human rights issues."

3. Most people do not want to feel ripped off, they want to pay fair prices and to them fair means what everyone else pays, what is market rate--even if market rate prices appear fair to the customer and the shop owner, but not fair to the worker.

4. Most people are so brain-dead from their dead-end and demoralising jobs, they don't think.

Anyway, if you have any ideas on how to change consumer behaviour or even to help me understand why people spend money the way they do, please do let me know. Tell me how you behave when you go into a shop. What do you think about and why?

Wednesday, October 08, 2008

World's Worst Condolence Letter


(JB Jeyaretnam on a victory tour at the Anson by-elections in 1981.)

I was very upset to hear of the death of JB Jeyaretnam, Singapore's first opposition party candidate to be elected MP, 16 years after Singapore gained independence. JBJ was 82 years old and passed away on the 30th Sept.

I feel sad for Singapore because we have lost someone who was committed, right to the very end, to making Singapore a better, fairer, more just place for us all. JBJ fought what must have felt at many, many times a lonely battle. Many people say Singaporeans deserve the government we get because we lack the courage or desire or conviction to demand more. As the New York Times puts it, "As a price for their affluence, most people there accept restrictions on civil liberties and free speech. Few have called for fundamental change, as Mr. Jeyaretnam did." Clearly JBJ thought Singaporeans deserved better.

I am also sad because I think there is no one else like JBJ, no one in the opposition with his stature, because he was there from the start, challenging the People's Action Party in repeated attempts since the 1970s, to get some semblance of checks and balances in place. It is also much more difficult for opposition party candidates to gain that kind of stature today, because the odds are more heavily stacked against them.

In the early years on Singapore's independence, before power was concentrated in one party, there was much less gerrymandering.

The PAP will celebrate 50 uninterrupted years in power next year, in 2009, and is the model for the Cambodian People's Party (CPP), headed by Prime Minister Hun Sen, which also aims to establish a one-party state. Singapore is also the model for Putin's Russia:

Yukos oil tycoon turned political prisoner Mikhail Khodorkovsky once said, "It is the Singapore model, it is a term that people understand in Russia these days. It means that theoretically you have a free press, but in practice there is self-censorship. Theoretically you have courts; in practice the courts adopt decisions dictated from above. Theoretically there are civil rights enshrined in the constitution; in practice you are not able to exercise some of these rights" As quoted in www.dailynews.com.

The Singapore government takes a less crude approach in dealing with dissidents--it does not put a bullet through your head, but sues you for all you're worth. In the case of JBJ, he spent more than 900,000 US dollars paying off damages awarded to PAP leaders and had to sell off his house in Singapore, settling in his later years in Malaysia's Johor Bahru. A lesser man would have given up, giving excuses that Singaporeans are not worth it, that he'd work so hard for his money and for his family etc etc.

Despite attempts by the Singapore government and its media's at dismissing JBJ's contributions, many Singaporeans know what he was trying to achieve and--secretly or not--cheered him on. His son talks about the numerous occasions when taxi drivers (who some say are society's barometer) refused to accept payment for rides.

His death was covered by The New York Times and AFP.

And here is the Singapore Prime Minister's Letter of Condolence:

CONDOLENCE LETTER FROM PRIME MINISTER LEE HSIEN LOONG ON DEMISE OF JB JEYARETNAM
30 September 2008
Mr Kenneth Jeyaretnam
Mr Philip Jeyaretnam
Dear Kenneth and Philip Jeyaretnam
I was sad to learn that your father, Mr Joshua Benjamin Jeyaretnam, has passed away.
Mr JB Jeyaretnam was a Member of Parliament for Anson constituency from 1981 till 1986, and a Non-Constituency Member of Parliament from 1997 till 2001. He used to engage in heated debates in the House. Perhaps it was because he and the PAP never saw eye to eye on any major political issue and he sought by all means to demolish the PAP and our system of government. Unfortunately, this helped neither to build up a constructive opposition nor our Parliamentary tradition. Nevertheless, one had to respect Mr JB Jeyaretnam’s dogged tenacity to be active in politics at his age.
However, our differences were not personal. In 1993, one of you (Kenneth) wrote to Mr Goh Chok Tong, who was then Prime Minister, to say that you found employers in Singapore reluctant to offer you a job, and your only explanation was that the employers felt the authorities would not welcome your employment because of your name. Mr Goh replied with a letter which could be shown to prospective employers, to say that the government did not hold anything against you, and that employers should evaluate you fairly on your own merits, like any other candidate, because Singapore needed every talented person that it could find. Mr Goh had previously made the same point to your brother Philip, whom he had invited to lunch. I am therefore happy that both of you have established yourselves in Singapore.
Please accept my deepest condolences.
Yours sincerely
Lee Hsien Loong

You can read more about JBJ here:Wikipedia and on politics.sgforums.com.

Sunday, September 28, 2008

Money as Debt

Here I am trying to explain Fractional Reserve Banking when Paul Grignon's 47-minute animated presentation of "Money as Debt" tells it better than I ever could. So just watch this - it will forever change the way you look at banks and help you understand the situation the US economy is in.


How money is created

If you are like me, trying to understand how the world's financial system works, you need to know about Fractional Reserve Banking. Don't get intimidated by politicians and others who tell you the economy is too hard for you to understand, so just keep your head down, glued to your PC and churn out whatever it is you churn out in order to make money for your company.

What you should remember is that everything in our world evolved. There is an explanation for the way corporations are the way they are now (you can read "The Corporation" by Joel Bakan for that), and there is an explanation for the way banks are the way they are now.

So, how did our banking system come to be?

Long ago, people would deposit their gold or silver with goldsmiths for safekeeping. The goldsmith would then give their clients promissory notes that guarantee their gold. If you'd like your gold back, just show the notes. These notes came to become currency as people traded them instead of their heavy gold. These goldsmiths realised that people did not usually redeem their notes at the same time, which gave them the idea that they could invest that gold, which remember, belongs to other people, to make money. So, while you are out spending your notes for chickens and cows, the goldsmith was spending your gold to buy more gold, or loan your gold for an interest. He would be ok, as long as you do not redeem your note at the same time as all his other clients (he could be spending a fraction of his reserves, say 50% of all the gold on hand, so he'd have backup in case some customers did come back for their gold).

From becoming passive keepers of gold, these goldsmiths now became essentially banks - earning money from investing (depositors' money) and charging interest for loans (again, depositors' money). Banks make money, as we all know, by charging a higher interest for loans than the interest it pays its depositors. Indeed, banks consider deposits to be a liability and loans and reserves to be assets. And so long as not all depositors withdraw their money at the same time, the bank would be safe. However, it has happened, such as in the UK's Northern Rock crisis of 2007, when depositors' took out their money at the same time in what is called a Bank Run, or a Run on a Bank.

"For the economy and the banking system as a whole, the practice of keeping only a fraction of deposits on hand has an important cumulative effect. Referred to as the fractional reserve system, it permits the banking system to "create" money." - US Federal Reserve.

Ok, so now we need to understand the cumulative effect and the way this allows the banking system to "create" money.

This is how it works:
Say you deposit $100 with a bank, which has a fractional reserve rate of 20%. This means the bank keeps 20% of its deposits as reserves. So, it lends $80 and keeps $20. Say the person who borrowed the $80 then spends the whole amount at my shop and I then deposit the $80 into the same bank. The bank keeps 20% of this $80 which is $16, so it now has $16+$20=$36 in its reserves. It then loans out the remaining 80% ($80-$16=$64). You can see already that the bank has been able to lend more money than the original $100 deposit. It has loaned $80+$64=$144. In this way, the bank "creates" money even though no extra money was physically created beyond the $100 that was the first deposit. We call this money created by banks "Commercial Bank Money" or "Chequebook Money". This contrasts with Central Bank Money, which is actual, physical money (coins and notes) that government mints print. And the bulk of the money 'in circulation" in the market is this commercial bank money

Wikipedia has a great chart that shows clearly what happens as the lending process continues and more money is created.
http://en.wikipedia.org/wiki/Fractional_reserve_banking. Most of what I say here can also be found on the wiki site.

I'll post this first and continue with the problems of this system in another post.

Boeng Kak Lake Forced Evictions

I should have posted this on the blog long ago. This is typical in Cambodia- forced evictions for the profit of powerful individuals. An estimated 3000 to 4000 families will be affected in what Amnesty International
says may be the biggest forced eviction in post-war Cambodia.

I had signed the petition to save Phnom Penh's Boeung Kak lake 3 weeks ago and was recently reminded of it by a friend who read my comment and asked me to be careful because this is a country which does not tolerate dissent. Here is my comment, which I thought rational and based on facts.

Diana Saw: Please consider your image in front of the international community with this forced eviction. Who would want to patronise the resort if they knew its history? "Although little known, Shukaku Inc has been linked in the Cambodian press to Pheapimex, a giant land company owned by ruling party senator Lau Meng Khin". (Andrew Nette, IPS)


Still, I know Beong Kak's history will not make a difference to the resort's future patrons. At the risk of giving Pheapmex and others an excuse to continue with their plundering, I should point out--because it would be dishonest not to--entire countries have been built on landgrabbing - such as the USA and Australia which has displaced and replaced the original population. Do people not patronise, work with or holiday in these places? Of course they do. So how do you remain unhypocritical? If you really wanted to boycott places that have a shameful history, there are many places you'd have to rule out.

Anyway, if you'd like to find out more about the Boeung Kak Lake situation, go to Save Boeung Kak.

Saturday, September 27, 2008

Jump!

Photo Credit Gawker.com

Some New Yorkers are getting fed up with Wall Street bankers. They also planned a day (Thursday, 2 days ago) to dump their crap in front of the Bronze bull scuplture on Wall Street to protest the USD700 billion bailout. Read more on www.alternet.org

I remember when 9-11 happened I mentioned at work, "Well, if 3000 people are going to die, they might as well be investment bankers". (of course I do know many of the 3000 were ordinary cleaners etc, but I was talking specifically about the Wall Street bankers). That drew fury from a Christian co-worker who said "Who are you to judge? Only God can judge who should die!"

It now appears I am not the only want who think investment bankers and their ilk are better off dead than profiting from the misery of ordinary folk. They get huge bonuses even as they screw up the companies they run - and these are just the CEOs.

This is proof:
Sept. 26 (Bloomberg) -- Wall Street's five biggest firms paid more than $3 billion in the last five years to their top executives, while they presided over the packaging and sale of loans that helped bring down the investment-banking system.

Merrill Lynch & Co. paid its chief executives the most, with Stanley O'Neal taking in $172 million from 2003 to 2007 and John Thain getting $86 million, including a signing bonus, after beginning work in December. The company agreed to be acquired by Bank of America Corp. for about $50 billion on Sept. 15. Bear Stearns Cos.'s James ``Jimmy'' Cayne made $161 million before the company collapsed and was sold to JPMorgan Chase & Co. in June.

Meanwhile pensioners and the ordinary American citizen have to help fund the proposed USD700 billion payout. Simply disgusting.

Thursday, September 25, 2008

Gore urges civil disobedience to stop coal plants

One way of doing your part...
Reuters

"If you're a young person looking at the future of this planet and looking at what is being done right now, and not done, I believe we have reached the stage where it is time for civil disobedience to prevent the construction of new coal plants that do not have carbon capture and sequestration," Gore told the Clinton Global Initiative gathering to loud applause....

"Scientists say carbon gases from burning fossil fuel for power and transport are a key factor in global warming.

Polar bears resort to cannibalism as Arctic ice shrinks

This is why we all have to do something, anything, to save our planet. Even compressing your trash in your trash bag will reduce the numbers of trash bags used. Do something good today.

http://edition.cnn.com/2008/TECH/09/23/arctic.ice/index.html?

Excerpts from the full article:

"The Arctic sea ice melt is a disaster for the polar bears," according to Kassie Siegel, staff attorney for the Center for Biological Diversity. "They are dependent on the Arctic sea ice for all of their essential behaviors, and as the ice melts and global warming transforms the Arctic, polar bears are starving, drowning, even resorting to cannibalism because they don't have access to their usual food sources."

Scientists have noticed increasing reports of starving Arctic polar bears attacking and feeding on one another in recent years. In one documented 2004 incident in northern Alaska, a male bear broke into a female's den and killed her.

In May, the U.S. Department of Interior listed the polar bear as a "threatened" species under the Endangered Species Act. In a news release, U.S. Interior Secretary Dirk Kempthorne stated, "loss of sea ice threatens and will likely continue to threaten polar bear habitat. This loss of habitat puts polar bears at risk of becoming endangered in the foreseeable future, the standard established by the ESA for designating a threatened species."

What is the future for Arctic sea ice? Some scientists believe that in just five years, the Arctic may be ice-free during the summer.

"The Arctic is kind of the early warning system of the climate," Meier said. "It is the canary in the coal mine, and the canary is definitely in trouble

Tuesday, September 23, 2008

Crooked "Customers", Copycats and Culture

So I get a call the other day from a tuk-tuk driver asking me where my house is because his customer wants to know. Obviously there's a miscommunication. He puts me on the phone with his customer, a French bloke who then asks me where the Bloom shop in the Russian Market (in Phnom Penh) is. They're at the market but cannot find it (unsurprising because the market is a maze). So he puts me back on the phone to speak with his tuk-tuk driver cos he can't speak English well or any Khmer and the driver cannot understand him.

Fine, I give the necessary directions (its shop number 808, and near the food market, where the "famous ice-coffee" shops are, in case you are looking too). I even called the tuk-tuk guy back to ensure they did find the shop.

Then when I was down in Phnom Penh 2 weeks ago, our shop assistant tells me about this "French man who talk like girl-girl" who told her he had arrived from Siem Reap where he had also visited the Bloom shop. He went specially to our Phnom Penh shop, not because he was looking for designs not carried in our Siem Reap shop, but for more sinister intentions.

He told Sok Yee he would pay her money and buy two bags (if she gives him a discount of course) if Sok Yee would tell him where the women work (he wants to see more designs, he says) and if she puts him in touch with the women. Turns out he wanted to bypass Bloom and hire the women to copy our bags for him. Sok Yee was on to him, because it is not the first time it has happened. In fact, that was what sacked Bloom manager Sipha did, taking customer orders and instead of letting the Bloom team know, she would sew the bags herself and outsource to other sewers and keep all the money. The reason she was able to was because the previous shopgirl was in cahoots with her and would pass her (instead of me) customer requests.

Thankfully Sok Yee is honest and told him that all the stock is in the shop and with Diana and suggested he speak with me. The effeminate French man then said, "I don't want to buy from Diana. She sells expensive." Damn right I sell "expensive" - the term a selfish git like him would use for our prices - other people use the word "FAIR". Bloom's prices are higher than the typical market stall because as I take pains to explain all the time, Bloom has fixed costs such as good salaries (and holidays and bonuses), rent for the workshop, utilities, etc etc that these market stalls do not have. They pay women sewers piece rate, so are able to price their bags cheaply (their cost is the material cost plus labour, which can range from as little as USD0.10 to USD3 a bag, depending on size). Bloom cannot. (Read "Business Competition in Cambodia" in this blog for more).

I say clearly on the blog if you want a bargain bag, don't come to us. If you feel you cannot afford to pay a fair price, then go elsewhere. Cambodia is full of exploitative shops and factories. You will not have to look hard to find your cheap bag. Honestly, I am not interested in selling to people who have disdain for a person's right to fair wages. If you want to save your money so bloody much, go to China or Indonesia. I guarantee you will be able to buy armloads of cheap bags, all churned out by young people who leave their hometowns in search for jobs to feed themselves and their families and end up working as virtual slaves, earning USD45 for an entire MONTH! How much do you think the French man earns? The same guy who wants to build a business copying other people's products and paying the workers pittance to do the job while maximising profits for himself?

I am furious just typing this. The Bloom team and me have worked hard (for two years!) to build our reputation for quality bags and we work hard to try to survive in a place where we compete head on with dubious NGOs and capitalistic businesses (like this guy imagines he will set up), without compromising our commitment to justice and fairness for workers and our commitment to quality and fair prices for customers. (It should be known that there are shops on Phnom Penh's posh St 240 and elsewhere that charge double what we do for similar, if not identical, bags. The whole point about Bloom is to MAKE TRADE FAIR (apologies to OXFAM)- this means FAIR WAGES to workers and FAIR PRICES to customers).

I hate cowards like this girly French man. You want to copy our bags and outsource to other sewers? Fine, pay the right price for the Bloom bag and take the bag to your own people. Go find sewers to copy the designs - they are everywhere. You don't have to limit yourself to the Bloom team. In fact, the Bloom manager I sacked, Un Sipha, has set up her own shop and workshop to take on orders from people like this French guy - people who want to pay cheap and get the exact same bags as Bloom. That's right. The sacked manager, whom I taught everything, has started her own copycat business, even housing her shop at our former shop at the Russian Market, stocked with all our designs. (A British friend living in Phnom Penh alerted me to the shop and I laughed when I heard she tells people she was the former designer at Bloom--most of our designs are adapted from bags I own from Singapore, such as the grocery shopper and messenger and gym bags. She was not much of a designer, but hell of a copier).

As I have said before, I don't mind copycats. I find it rather amusing, maybe because I do believe Imitation is the sincerest form of flattery. In fact, some days I think if Sipha who had nothing when I met her 2 years ago is now able to become a businesswomen, then it is a measure of success on my part. From the beginning I had told Sipha about the aim for Bloom to be a workers' cooperative so she and the other women would own, manage and grow the business. I shared with her everything about running Bloom, because I believed she would be one of the team leaders in the cooperative.

Thinking back, there were signs she was not the right one to lead the team, because she was constantly telling me we should not tell the other women how much it costs to make per bag, and especially, how much we sell them for. The women, including Sipha, who all trained at Hagar, had no idea how much the bags they were making were selling for at Hagar--all they knew was theirs (and each others!) wages.

And Sipha thought this was the way it should be - managers should be privy to certain information and workers should be kept in the dark. If they know too much, they will have ambitions or demand more. Turns out, Sipha thought like this because it takes one to know one. If was Sipha who was harbouring ambitions. [But that is not wrong itself. People with initiative think about starting their own business all the time. That was the case for me. Why should Cambodians be any different? What she did wrong was to have stolen money from me. If not for the fact she stole goodness knows how much from me and the Bloom team, Sipha would have my blessings and even assistance. Now I treat her like I never laid eyes on her.]

To me, the more workers know about the business, the better. This means they would feel a sense of ownership and a clear idea of where the business is headed. I have always managed like this, something I had learned from my very first Australian bosses. In Singapore, when I eventually ran the company, we would have monthly meetings where I would share the budget with staff, meaning what we projected for the month and the year, how we did in actual fact and the reasons why, and how we are going to get to what we projected. Staff appreciated this and the more I shared, the more I felt staff wanted to work hard for our common goal.

Sharing business information is even more important at Bloom, because if I intend to hand the business over to the Cambodian team, they need to know as much as possible. That is why I have always told Sipha I do not like secrets and insisted she shared information with the staff. One problem - and this is a lesson for expats - is because I was not so confident with my Khmer, I spoke only to Sipha, expecting her to convey the information to the team. Of course she didn't. The lesson is always talk directly to ALL your staff, don't trust your manager, or indeed, translator, to convey everything for you.

Back then, my conversations with Sipha often left me pondering about the hierarchical nature of Khmer society--why the higher ups would talk down to workers and why they would throw their weight around. Even dressing was used as a tool to establish status. Khmers are always telling me to dress better to show I am the boss, to not ask questions, but just tell staff what to do, to order, not discuss. My style has always been to ask questions and build consensus, because as I always tell the team, everyone has ideas, not just the managers. I often wonder if I'm knocking against a brick wall--how do I expect the team to appreciate what I am trying to do, how can they work in cooperation as a team, with respect for each other, if all they know is to either to order or be ordered around? I also think they do not trust me because they have had lousy bosses who may have promised them the world and then abandoned them. How can I show I mean what I say?

Frankly I am still not sure if the cooperative is a pipe dream. I worry Bloom will fall apart the day I leave the country and leave Bloom in the hands of our Cambodian team. All I know for sure is I will keep trying, to show them by actions, that I believe in them, that they are capable of caring for one another, that they are capable of making Bloom work on their own. One thing I am doing now is to tie the workshop (production) with the Russian Market shop (sales). I have told them that if the shop makes money, they will share all the profits. Hopefully that way they learn more about business, instead of just wanting to complete their sewing, without understanding what sells and what doesn't. I want the women to learn what customers want and listen and come up with ideas for improving the business. Like I said, I don't know if it is a pipe dream, but I want to try to make it work.

Sunday, September 21, 2008

Dengue Second Time around can be fatal

If you are like me and had dengue once, you should really cover up. Don't listen to people who know nothing about the disease telling you you would be immune cos you got it once. Dengue is unusual that way--it gets more serious the second time around. The reason is that there are 4 strains of dengue and if you contract any one of the 3 strains different from the one you got the first time round, your body will use all its resources to fight what it thinks is the first strain, leaving it defenceless against the new virus. You may then get Dengue Hemorrhagic Fever - which effectively destroys the platelets that cause blood to clot, meaning you can bleed to death.

It's rainy season now and I got dengue in Oct 2006 in Phnom Penh. Now, Chhun Hy, the young Cambodian man who lives with us here in Siem Reap has it. Which means if a mozzie bites him and then me, I will get it. Alan contracted dengue in Singapore, and the chances that he'll get a new variant here in Cambodia is higher for him. Very worrying.


You can read more about dengue here:

Scientists crack dengue fever puzzle

Experts may have solved the mystery of why dengue fever, unlike other infections, is usually more severe the second time around. Dengue is a debilitating, sometimes fatal illness endemic to much of the tropics. Caused by a virus, it is characterized by high fever, bone and muscle pain and -- in the most serious cases -- hemorrhage and fatal shock.
Dengue is also unusual in that //symptoms are more severe during a second or third infection compared to first-time infection. Experts estimate that over 50 million people are affected by dengue each year, with about five percent of patients dying of the illness.

The findings may complicate the search for a vaccine against the deadly mosquito-borne illness, according to British and Thai scientists. Now scientists believe they have solved the dengue paradox. The key to the puzzle, say researchers is the fact that the dengue virus falls into four distinct subtypes. Initial infection with one subtype causes the immune system to direct its response to that specific variant. But if an individual later contracts any of the three other variants, he or she is left virtually defenseless against the virus.

The scientists evaluated the immune cell response of 73 Thai children hospitalized with dengue fever and found that all but two had been infected at least once before.

What's more, these children had relatively low levels of infection-fighting T cells specific for the new virus. Normally infection with viruses such as hepatitis C or Epstein-Barr result in high levels of such T cells. The researchers think a second infection triggers the immune system to frantically hunt for the wrong subtype of the virus, causing painful inflammatory symptoms such as aching and fever.

However, this second immune response generates immune cells that only react weakly to the new virus. And the duration of the disease is also much longer because the body fails to clear the infection quickly.

http://www.bio-medicine.org/medicine-news/Scientists-crack-dengue-fever-puzzle-2063-1/

There is no vaccine for dengue, so you just have to use repellent and cover up.

Saturday, September 20, 2008

Capitalism in convulsion

Capitalism in convulsion: Toxic assets head towards the public balance sheet
By John Plender
Published: September 19 2008 19:25 | Last updated: September 19 2008 19:25

"In the space of just two momentous weeks, the landscape of global finance has been dramatically transformed. President George W. Bush’s administration has mounted a multi-billion-dollar rescue of the financial system at the cost of inflicting severe damage on the US model of free-market capitalism.

"Heavy costs will be inflicted on the American taxpayer, who is now subsidising Wall Street – and indeed financial institutions around the world – in a bail-out of unprecedented size....

"The reality is that the financial system has been operating as if it were an off-balance-sheet vehicle of the government. Private-sector companies and individual bankers have been making huge profits in the bubble. Their risk appetite has been enhanced by previous bail-outs and, in the case of Fannie and Freddie, by the government’s implicit guarantee. Yet their market pricing does not reflect the potential cost to the system of their own collapse....

"Having implicitly guaranteed Fannie and Freddie and underpinned the operations of irresponsible bankers at AIG and elsewhere, the US government is putting bankrupt institutions back on to the public sector balance sheet via nationalisation."

Read the complete article here: Financial Times

Saturday, August 30, 2008

A Cambodian man's dream of marrying a foreign woman



These lovelies from Malaysia popped by to buy some bags and Chhun Hy insisted on me taking a photo of him with the women! Chhun Hy is very charmed by Malaysian women--he thinks they are very pretty. He and his family from Kampong Cham would like him to marry a foreigner. I always assumed it was because the family wants Chhun Hy to marry into wealth, but the reasons are more layered than that.

If Chhun Hy were to marry a Khmer woman, he would have to pay a dowry of USD2000-3000 to her family. On top of that, he and his future wife would have to share to pay for their wedding ceremony, about USD1000 each. He feels that it is too expensive for him to marry a fellow Cambodian, so that is why he'd like a foreigner for a wife.

I find the whole idea ridiculous. There are so many poor people in Cambodia--don't tell me they cannot get married? Chhun Hy explains, "Yes they can, but they would have to marry another poor person. But if you want a house, a motocycle, a business, you need to marry a rich woman."

But you will have to pay a lot of money to marry this rich woman, I reminded Chhun Hy. But it is a small investment, he argues. He keeps repeating,"In Cambodia, [it is] like this. Also in Thailand, men want to marry rich women."

Because Chhun Hy is the only one living with foreigners (he lives with us), can speak English and is taking computer lessons, and has tripled his income in a year, he is his family's hope of a better future. So they continue to dream of him marrying a foreigner. I try to explain marriage is so much more than money, but I fear it falls on deaf ears.

Sunday, August 24, 2008

Taxi/Bus from Siem Reap to Bangkok

Update [24.06.2009]: A few readers have told me the road from Siem Reap to Poipet is almost all paved, which makes the journey shorter. I checked with a travel agent next to the Bloom shop here in Siem Reap, and she says the journey has been cut by 2 hours, if you are taking a bus all the way. It now takes 8 hours compared with 10 previously - 3 hours from Siem Reap to Poipet and 5 hours from Aranyaprathet to Bangkok (including the border crossing). The cheapest bus ticket I've found costs USD7.50 and will take you right to Khao San Road. You will need to change buses once, after you've crossed the border. In Siem Reap, you will be taking a bus which will pick you up from your guesthouse if you book with a travel agent, but the bus you change to may turn out to be a mini-van, depending on the number of people who go on to Bangkok (many people, Cambodians especially just take the bus to the border).

Right, as promised I will tell readers about how I travelled by land from Siem Reap to Bangkok. Before embarking on the trip I tried searching the Internet for advice and found that most shared advice on going from Bangkok to Siem Reap, but few write about the trip in the other direction. So here goes:

Cambodia and Thailand share a border. The Cambodian side of the border is called Poipet and the Thai side is called Aranyaprathet.

From Siem Reap, you can either take a bus or a taxi to Poipet. I booked a taxi for USD30 and for that you get the whole car to yourself (a Toyota Camry with air-con which is necessary because the road can get very dusty). I booked the taxi through a travel agent but asked the driver how much was his cut and he said USD25, so presumably you can pay USD25 if you know a taxi driver and bypass the agent.

It took us a little over 3 hours to get to Poipet. The roads are not as bad as we had been told. It was a bit bumpy in the beginning for about an 1 hour but it was fine further on. The roads are mostly like this--red and dusty but you will come across stretches of concrete roads. Really, it is not that bad. You will come across many detour signs -- it seems the Cambodians are building small bridges everywhere, for what purpose I do not know. I was told by the taxi driver that the Cambodian government will be improving the road (rumour has it a Thai airline company has been paying the Cambodian government to keep the roads bad so more people will choose to fly). You will also see electricity poles and about 2 hours into the trip, you will see a number of houses that carve large buddhas from stone.






The taxi does not take you up to the border, only to a roundabout from where you can walk to the Cambodian Immigration booth to get your passport stamped. As soon as you alight from the taxi, you will be approached by young men pushing large wheelbarrows. These guys will offer to take your luggage for you to the border. I did not use their services because our bags were manageable, but I think they were just trying to earn a living. So if you cannot be bothered to lug your bags, you can consider paying one of them USD1 to help you (they'll take your bags right up to the border).

It is a 2 min walk to getting your passports stamped. It is on the right side of the road--you will not miss the immigration office, so don't worry. We left at 6:30am and arrived before 10am, so there was hardly any one in the queue.

After you get your passport stamped, it is still a long walk over to the Thai side. Just keep walking straight ahead for about 15mins. Along the way you will pass by a couple of large casinos and even though you are still on Cambodian soil, the roadside stalls and cafe all charge baht. There is an ANZ teller along the way and I took out some USD to change into baht.

Then you keep left to go to the Thai immigration room. Remember to fill in a departure card--both sides--before getting your passport stamped by very grumpy Thai officers. I have to say the woman Thai immigration officer is the rudest one I have encountered in the dozens of cities I have been (except for an Aussie man who asked me the most offensive questions like, "so Diana what will you do if you meet a nice Australian man?" way back in 1990 when I was still a teenager travelling to Australia for a holiday with a friend.)

The Thai woman official would not speak to me and would not lend me a pen to fill in the back part of the departure card. Her disdain conveyed that Thais don't care much for foreigners or for the English language.

Once you cross the border comes the tricky part. Forget about finding bus companies nearby. What you will find is a little village of small shops selling drinks, food, clothes etc. The first thing to do if you have not already changed baht is to get some. I could not find a money changer so I took cash from a machine from a bank which is on your right.

Mom sat down at one coffee shop while I went to look for the bus that will take us from Aranyaprathet to Bangkok. I turned left and down a slope and came to a large bus depot. There were many people waiting for buses, but one thing about Thailand--very, very few people speak English. It comes as a surprise coming from Cambodia, especially Siem Reap, where many locals speak English.

Anyway, I approached what looked liked the bus "office" (on the right). You will see staff in uniforms, but no one could speak English. The staff approached a Thai woman who spoke English, who then told me to go back up the slope to a bus company and asked that I buy tickets from there. She said the buses at the depot are for locals; tourists take the bus from that company.

Then she motioned for me to get on a little tram-like vehicle which provides free transport around the area. We hopped on and went back up the slope to where the company was (I forget the name but there is only one there--and it is really a travel agent that is set up to look like a ticket booth). There are 2 buses you can take. One takes you to Khao San Road while the other takes you to a bus station in Bangkok. The tickets cost 250 baht for the Khao San bus and 300 baht (USD9) to the bus station. The Khao San bus would leave at 1.30pm so I took the other, which was leaving at 11am. I was told that a staff member would take me to the bus.

He did--he brought me and mom back to the same bus depot where we boarded a double-storey bus. Unlike Cambodia, you do not get tags for leaving your luggage in the compartment under the carriage, but that turned out not to be a problem. The bottom storey of the bus does not have 2-seater seats, only a lounge-like room, which had a U-shaped seat around a small table and a couple of double seats. We were told to sit with a bunch of strangers on the U-shaped chair. I wasn't very pleased for the lack of privacy but it turned out ok and the Thai people (we were the only foreigners on the bus) were friendly.

Just before we took off, a woman came over collecting money. She asked me for 200 baht. I asked why? It turns out you can buy tickets on board the bus. And they are only 200 baht each; not 300.

The bus has a toilet and stopped once during the 5 hour trip. Thailand is obviously a rich country: roads are huge and paved and along the way you will see huge car showrooms. The bus stopped at a petrol station that had many hawkers selling fruit, fried bananas and sweet potatoes and there was even a 7-eleven.

Once you get to Bangkok, don't panic. Bangkok is a large city and if it looks industrial, do not worry. Eventually the bus will take you into the heart of the tourist areas near Sukhumvit and Rama IV roads. We got down at one stop and took a taxi to Sukhumvit cos that is the only place I could remember (where the 4-faced Buddha is located). We ended up at the Central shopping mall which was lucky, because there was a large outdoor exhibition on the environment worth seeing.

We then decided to go to Khao San for cheap accomodation. It was already after 5pm so traffic was a killer and taxis would only take us there for USD10. Many taxis in Bangkok refuse to use the meter, but be patient and you will eventually be able to find one that does. We were tired so when a tuk tuk offered to take us for 150 baht (about USD5), I said ok. Later on we took a metered taxi to the same place and it cost us only 80 baht, if that.

That's it. I'll write about the trip home and the (other) hucksters I encountered.

Thursday, August 21, 2008

Blood, sweat and T-shirts - BBC documentary

If you are still not convinced it is unfair that there are human beings who work hard to earn pittance, this BBC show will open your eyes. Six Brits experience what it is like working in India to produce the clothes that they buy all the time in the UK, without a thought as to who makes them and how they are made. Here's what they concluded:

"I know that I personally, would be happy to pay a little bit more for whatever I'm buying, to know that it hasn't been made in horrible conditions, getting paid next to nothing." (6:34)

"A safe working environment where you are not going to die of disease, is not a lot to ask for" (8:24)

"Brands that get clothing made in places like this should be quite ashamed of themselves." (8:29)


BBC Panorama: Primark on the Rack

While on the topic of sweatshops, watching this BBC expose on Primark, a British high-street retailer, about a month ago made me so angry I posted it on my facebook profile. Here it is for readers of this blog. Primark claims to make clothes ethically but the excellent Panorama team traced its supply chain to refugee camps in India where children as young as nine make clothes for as little as 1 pence (2 US cents) an item.

And it's not just Primark. I know of online retailers who claim to buy "fair trade" products from "women's cooperatives" in Cambodia and it is just bullshit. These so-called "women's cooperatives" pay piece rate and the women have to work like mad to make a living wage, because there is no base salary. Or you have organisations that pay minimum wage base salaries of USD50 and make the women work overtime piece rate to make up the rest of the wage. It is outrageous that consumers are lied to on a constant basis. These retailers DO NOT CARE how the things are made. I really believe many times they know workers are being exploited but they choose to look the other way. Or they make it a point NOT to investigate.

In Cambodia, the same thing happens with aid money. I was told just today that a large NGO here in Cambodia does not bother to speak with actual beneficiaries in the provinces. They speak only with the village chief who submits the names of his relatives or those who bribe him as candidates for the donation. It's so easy to cheat donors' money.

These NGOs and retailers have such an easy way out--they can always blame the next guy along the chain, the village chief or the supplier. "It's not our fault, we were misled too!" they will exclaim indignantly. Bullshit. It *is* their fault. These organisations can do much more if they wanted to. Indeed, it is their obligation to do due diligence and not pass on the lies to customers/donors.

If you want to be a responsible consumer, please do not take retailers' written policies at face value: talk is cheap. Ask yourself how you can buy a top for 3 pounds (USD6) and yet producers are paid a living wage. How is that possible? (On the flip side, be aware that just because a ricebag is sold for USD40 does not mean workers were paid fairly for making it).

I know people want to save money when they purchase things, but surely not at the expense of someone else's suffering. Other people do not exist as machines that churn out cheap things, just so we can save our money for buying more stuff. Please, don't be an accessory to the exploitation of workers. Please, be more conscious of what you are paying for.

Wednesday, August 20, 2008

Nike sweatshop found again-this time in Malaysia

Hytex is reputedly the largest T-shirt manufacturer in Asia and it also manufactures for Nike. The factory is in Kepong, an hour's drive from KL in Malaysia. They exploit workers from Bangladesh, Vietnam and Burma who work 6 days a week for 45 Australian dollars (about USD40). Watch how these men live in appalling conditions while earning a monthly wage that is less than the cost of a Nike T-shirt in Australia. Expose by Australia's Channel 7 news.



Here is Nike's response

What is interesting to me is Nike has been in business for what, 30 years? And it *still* has problems managing its suppliers. Isn't it time Nike focuses on being the manufacturer of sporting goods instead of being just a brand that outsources the manufacture of its products? It's big enough, has deep enough pockets to do its own manufacturing in-house, yet chooses over and over, to outsource to unreliable partners that disappoint them and their customers. Its a sign surely that Nike only wants to commit to those aspects of business where the big bucks are - branding, marketing, media- and not the actual making of goods.

Tuesday, August 19, 2008

How *not* to hire and manage Cambodian staff

It's been over a month since I've updated the blog, which I do apologise for. I have been so very busy, traveling to Bangkok and to Phnom Penh (twice) in the last month. Cambodia is a big country, and it takes me six hours by bus to go to Phnom Penh from Siem Reap, where I live and where we have a Bloom shop. It's like going from Singapore to Kuala Lumpur in Malaysia, which also take 6 hours. I come from Singapore, where everything and everywhere in the country is accessible within an hour's bus journey, and despite the constant traveling in Cambodia, I am still not used to it.

(For the Bangkok trip, I took a taxi and then bus, which deserves an entry in itself.)

For now, just a quick update to tell readers Bloom had its worst crisis in the 20 months we have been in existence. I try not to write about the problems Bloom faces, but at the same time I don't want to give the impression a). it is easy doing business in Cambodia b). it is easy setting up and running a social enterprise. I write this in the hopes people will learn from my experience.

I'll write more when I feel less tired. All I'll say now is our Cambodian manager, Sipha, whom I have referred to in this blog as "my right hand woman" and honest etc, turned out not to be the person I thought she was. It was very disappointing and hurtful to learn she had been systematically stealing from Bloom, by inflating receipts and by stealing materials we purchase for Bloom (such theft is very common in Cambodia). In addition, she had been undermining the business by sewing our designs for other shops in Phnom Penh, including one in Beong Keng Kang 1. The BKK1 shop owner is a lovely Khmer woman and we had a long talk about Sipha's behaviour and the sympathetic owner even let me take photos of the bags as evidence that Sipha had been selling Bloom bags on the side.

I sacked Sipha on the spot when I went to Phnom Penh about a month ago. On the advice of a Cambodian friend I also placed an advertisement in the main Khmer newspaper that announced that Un Sipha is no longer employed by Bloom, so we will not be responsible for her actions henceforth. She called up someone I know and said she wanted to sue me for the ad etc. (there is no basis for the suit as I did not describe what she had done in the ad, although I am fully aware I am describing what she has done here, on this Internet posting. The reason I dare to do this is because I have evidence, the receipts and the testimonies of the shopkeeper and the market supplier). I was even told to be careful of acid attacks. One British guy I met for advice told me how he had a hand grenade thrown into the company's compound after he had sacked a staff member who was a former Khmer Rouge soldier. In short, I was advised, let things go. "Khmers can be very funny when it comes to losing face," was what the British man told me.

It has been very distressing time. Incredibly distressing. Close friends will tell you how one day I just broke down and sobbed and sobbed. I just could not stop. I was so very hurt and betrayed. Sipha had *nothing* when I met her--a mother of four who had left her drunk and abusive husband and had been out of a job for months, after Hagar asked her to leave. I remember how she had only one pair of shoes. By the time I had asked her to go, she had a dozen pairs of shoes (she was constantly buying shoes) and was staying in a three story flat from which she was profiting by renting the upper two levels for more than what she paid in rent. She even managed to buy USD3000 worth of land near Sihanoukville.

Which brings me to another point- I was very angry when I found out after this incident that I had been given someone via Hagar's job placement scheme, someone who had herself been sacked by Hagar. Incredibly, Hagar's job placement manager, disagreed with me that Hagar's job placement processes needs improving when I pointed out to her Hagar should not be finding jobs for people they themselves had sacked. She insists she cannot guarantee the women's behaviour. I do not ask for guarantees but surely it is fair to expect the NGO from whom you hire staff to tell you if they had sacked someone they then recommend you hire. The manager thinks I am trying to push all the blame onto Hagar for recommending I hire Sipha, when I should accept responsibility for not being more stringent with her. I told her yes, I do know it is my fault for trusting her with so much (never, ever trust your Cambodian staff with money is the comment I have gotten since this happened). As a result I have put new processes in place, for stock controls and have also hired a part time accountant based in Phnom Penh to check all the receipts and stock levels. I am also seriously contemplating moving back to Phnom Penh. But Hagar should not do this anymore--they cannot, should not, *must not* pass on a bad staff member to another organisation.

I will say it clearly: I do not think Hagar is a bad organisation. On the contrary, they have helped many, many women, women like Neang and Sophea and Kemhut, by training them and giving them the skills that enable them to get jobs like the ones at Bloom. Hagar also gives rice and bicycles to women who need these items. For that I thank them.

What I am saying is that no one and no organisation is perfect, and Hagar's job placement processes are far from perfect. I would like Hagar and other NGOs that provide skills training to not, ever, find jobs for someone they themselves had sacked. I know the reason why I was passed Sipha was because of pity, because people wanted to help this poor person, to give her another chance, but it is unfair and wrong for someone else to shoulder the risk of giving this person a second chance. At the very least, there must be disclosure to the new employer.

So, a very distressing period but a very, very useful one. I've learnt a lot from this incident and truly believe that Bloom can only benefit from this experience. We are already showing signs of improvement--we are working more closely as a team and former Bloom staff have actually come back (for free! who says all Khmers are grasping?) to help me during this time of crisis. One, Sina, has even quit his job at the Raffles le Royal to come back to work at Bloom. I feel so very lucky to have good friends like Sophal, my tuk tuk driver who found me a new workshop and Heng, who is always on hand for advice on how things are done in Cambodia. And Kerri and Virginie and Jimmy, of course, for being there when otherwise I would have been alone in Phnom Penh.

Tuesday, July 08, 2008

Menu at this year's G8 summit in Hokkaido, Japan

If you have any doubt how money is wasted at these summits, take a look at the menu. And they are supposed to be discussing solving world hunger and third world debt. Disgusting - these people should be ashamed of themselves. Nod to Pauline for pointing this out to me.

Source: http://blogs.guardian.co.uk/food/2008/07/g8_japan_food_menu.html

Dinner

Corn-stuffed caviar
Smoked salmon and sea urching "pain surprise" style
Winter lily bulb and summer savoury
Kelp-flavoured cold kyoto beef shabu-shabu, asparagus dressed with sesame cream
Diced fatty fles of tuna fish, avocado and jellied soy sauce and Japanese herb "shiso"
Boiled clam, tomato, Japanese herb "shiso" in jellied clear soup of clam
Water shield and pickled conger dressed with vinegar soy sauce
Boiled prawn with jellied tosazu-vinegar
Grilled eel rolled around burdock strip
Sweet potato
Fried and seasoned Goby with soy sauce and sugar
Hairy Crab "Kegani" bisque soup
Salt-grilled bighand thornyhead with vinegary water pepper sauce
Milk fed lamb from "shiranuka" flavoured with aromatic herbs and mustard
Roasted lamb and cepes and black truffle with emulsion sauce of lamb's stock and pine seed oil
Special cheese selection, lavender honey and caramelised nuts
G8 fantasy dessert

Wine list

Le Reve grand cru champagne
Japanese saki
Corton Charlemagne 2005
Chateau Latour burgundy
Ridge California Monte Bello 1997
Tokaji Essencia 1999 from Hungary

Thursday, July 03, 2008

New Blogger Template

I screwed up my old blog when farting about with trying on a new template last night. The BLOOM FAQs are gone so have to add that in again. The blog is now black to suit my current dark mood --also the V for Vendetta quote looks better black, no? Anyway am trying to have 3 column blog so will try again. Update: stupid blogger is not compatible with safari or firefox, so i can't just cut and paste. Grrr!

Tuesday, July 01, 2008

Snake vs Gecko Part 1!




A couple of weeks ago the dogs barking brought to my attention this snake trying to swallow a beautiful spotted gecko. The gecko was green with red spots. You can see how large the gecko's head is compared with the snake's in the second photo. I'll upload this first and the next pics to follow. Poor gecko: looks like he'll lose this battle!

Snake vs Gecko part 2!



If you look closely, there are some twigs in the gecko's mouth. Dad said maybe it was the gecko's way of saving itself from being swallowed. The snake wound itself around the gecko to suffocate it first. The third photo is awesome: nature at work. The whole process took a long time, almost an hour. Did it succeed in swallowing its prey? Stay tuned!

Snake vs Gecko Final Episode!



Austin was none too happy with the snake. He kept barking at it and the snake struck out once at him and once at Nessie. The dogs were so jumpy. It was quite funny to see them so nervous. Dad the hero -- he saved the gecko when he saw what was going on after he returned from a walk. He had used a stick, the one holding up the gecko, to prod the snake and it panicked and slithered away on a tree. The dogs got all excited chasing the snake. It didn't even occur to me to save the lizard. Actually, its cloudy eyes made me think it was already dead, suffocated by the snake. I just kept on taking photos and some short videos with my camera. Actually I felt a bit sorry for the snake. It was trying to have a meal for almost an hour, patiently trying to swallow the gecko, but in the end it had to give up. Dad then placed the gecko on a tree and we believe it survived, because it was nowhere to be found after a while. So Snake vs Gecko - Gecko wins! ... or at least didn't lose (its life).

Thursday, June 19, 2008

Business Competition in Cambodia

I just got a call from Sipha, one of the women at Bloom. She has been approached yet again by someone wanting to pay her to copy our bags. This time it is someone from Siem Reap. I am aware of this shop at the Center Market (Psar Kandal), which currently carries one piece each of Bloom recycled ricebags. I was unhappy when I came across this shop and had wanted to pick a fight with them because I knew these people had snipped off the Bloom cloth labels which we sew onto each bag, and replaced the Bloom label with the shop's paper tags which they string onto the bag straps. In the end I didn't pick a fight because I thought, well, at least they are buying our bags and they have to sell them at a higher price (they sell between US$3 to US$5 more per bag). In fact, an English couple just told me they decided to buy from us because the bags are exactly the same, yet ours is cheaper. Of course they are, given we are the original manufacturer.

So now, this Siem Reap proprietor is offering Sipha money to copy Bloom bags, the very bags Sipha sews during her work hours. I am really upset because this is not the first time it has happened and I've decided to write about this.

The first time it happened was a few months back, with a silk shop at the riverside in Phnom Penh. The woman proprietor had gone to the Bloom shop at the Russian Market in Phnom Penh and purchased one of our silk bags. She then asked Sipha to make the exact same design for her and pay her for each bag she sews.

I'm fortunate I am close to the Bloom women, so Sipha came to me to discuss this before agreeing to sew the bags (if she was a bad person, she would take on the job without even letting me know). Her point, and the point of the silk shop owner, was that even if Sipha doesn't sew the bag, someone else would (because the silk shop would outsource to another sewer), so why shouldn't Sipha make that extra money instead of another person?

I know the Bloom women are hardworking and want extra income. Because they work 5 days a week, 8 hours a day, weekends are free. Sipha wanted to use the weekends to make extra money.

At that time, I had explained to Sipha that people who pay piece rate can sell the bags cheaper and make a profit, because they do not have fixed overhead costs, such as salaries, the rent for the workshop, sewing machines, electricity etc etc. Bloom is a social enterprise and I want to pay staff a living wage, regardless of whether the bags sell or not. This contrasts with the majority of businesses in Cambodia, which pay workers piece rate. If the bags sell, they hire workers to sew. If they don't, the business doesn't have to worry about fixed costs such as salaries etc. In this way, the business owner reduces his/her risk. Almost all the businesses here operate this way, including a big one near Phnom Penh's Russian Market which supplies to the US, and which claims to be a Fair Trade shop.

It is one of the most frustrating things working in Cambodia. Not the competition, but the lies. I have written about this previously, in the context of NGOs, about how stupid, lazy people just take things at face value, not doing due diligence, not bothering to find out the truth. Are the organisations that claim to be Fair Trade really Fair Trade? How can a company that pays piece rate say they are fair to workers? Piece rate work means no sick leave, no holidays--you don't work, you don't get paid. Which developed country would accept this as fair to its workers? At Bloom, workers get 14 days annual leave (same as Singapore law) plus 16 days public holidays (Chhorvy, the Hagar NGO re-integration manager told the Bloom women that is more than what *she* gets, at an international NGO, which is the 16 days public holiday. I'm sure Chhorvy was just being nice though!).

So what of Sipha? I had allowed her to sew the silk bags, because I was sympathetic to her arguments. This time however, I put my foot down. It is unfair to her co-workers at Bloom if she trains at Bloom and she knows which bags sell well and she liaises with another shop on the outside to copy our bags. If we cannot make Bloom work, I explained to Sipha, everyone will be affected. To be fair to Sipha, she understands everything I say, it is just that she wants to make extra money for herself and her four children. It is not easy on her as well. Now that she has a skill it is only right that she makes more.

Very early on, when I explained the savings plan to everyone at Bloom (how I would subsidise sewing machines for them, if they save for the machines), I said you will then be able to sew at home and make bags for other shops and become small business people--just make sure they are not Bloom's designs! At that time, everyone agreed, but that's the thing about life. We may have good intentions, but truthfully we often do not know how we would react unless faced with the actual situation.

My plan is two pronged. One is to make sure I sell enough bags that I can let Sipha (and the other women) work overtime on weekends and two, keep coming up with new and better designs. We will be so far ahead of them that the competition can just eat our dust!

Tuesday, June 17, 2008

Social Entrepreneurship and SIngapore Students

This is an email interview I gave to four students from Anderson Junior College (AJC) in Singapore who are planning a project on social entrepreneurship. "All of us chose this project because we strongly believe that it is possible to infuse business with a social motive and an excellent example would be yourself," wrote one of them, Sophial Foo.

It's an interesting project, combining theory and practice. I was interested to learn that JC students (17-18 year old) are actively thinking about social enterprises. In Sophial words: "A brief outline of our project; social entrepreneurship is a relatively new industry in Singapore and our project aims to raise awareness and at the same time develop a spirit of social entrepreneurship on JC students. We have come up with a 3-phased programme. In Phase 1, the students will attend a talk on social entrepreneurship. In Phase 2, the students will visit poor elderly people once a week for a month. In Phase 3, students will set up their own "mini-businesses" and the profits will go to the organization supporting the poor elderly people that they visited."

Really fantastic.

Anyway, here's the Q and A:

1. After visiting Cambodia and witnessing a mother trying to sell of her child for money, what made you give up your job to start a social enterprise? Was there a reason? Why not the convention method in Singapore, donation drives etc?

I had already given up my job and was travelling around the region when I came to Cambodia (I didn't quit my job to come here to do this). The reason I decided on a social enterprise is because I thought long and hard about the problems I saw and what the best way to help would be. I decided it was by providing fair paying jobs to adults. You can help children but if their parents don't lead stable lives, their children will never be stable. The people in desperate situations are that way because of grinding poverty. You can donate money and throw them a fish now and again, but I decided it would be better to teach them to fish. With a good job, people feel more secure, have confidence in the future and can start to think about dreams and plan to achieve those dreams.

2. What do you think about the current status of social entrepreneurship in Singapore?

I haven't been living in Singapore for the past 2 years so I have no idea what the situation is like now. I am aware there are government initiatives like Social Innovation Park but I have no idea how successful it is in promoting social entrepreneurism. At the end of the day, I think social entrepreneurism is not something that can succeed through prodding and incentives. You have got to want to do it badly enough to be committed to principles of fair play while at the same time be fully aware you will be facing the same pressures that apply to "regular" businesses.

3. Do you think that there is a mindset issue in Singapore? (Singaporeans would rather donate to charities and don't really believe in the sustainability of social enterprises)

It is funny, I met a Cambodian man who told me about his friend who studied in Singapore and therefore knows many Singaporeans. He said these Singaporeans will not be "used to" Cambodia, because it is unclean and hot and without paved roads etc etc, so they would rather donate money than come here. The thing that struck me was how earnest he was, when telling me this, like there was no judgement at all, merely stating a fact. I don't know how to describe how I feel about this. It seems to me there is such a big divide--between the people who live in poor and those in rich countries. I was struck at how poor people feel ashamed of their lives, when it is not something they should be ashamed about. It is often not their fault that they ended up in such a situation.

4. What are your thoughts on the future development of social entrepreneurship in Singapore?

I have no idea. I do think, though, that wealth affords people the luxury of contemplation, and as Singaporeans become richer and can afford to think beyond bread and butter issues, there will be more people questioning what they want out of life. And for many people, this questioning will lead them to doing charity work. You see it already in people in their 50s and 60s and older, who are established and want to help others. At the end of the day, I think many, many people realise that this is what is really important in life: spending time with the ones you love and helping others achieve their dreams--not your 5 Cs (note to readers not familiar with Singaporeans' obsession with the 5 Cs: Cash, Credit Card, Condominium, Car and Country Club membership). "All my possessions for a moment of time." - Elizabeth I's last words.

Many people, Singaporeans and others, have told me they admire me, or envy me, and wish they could do the same. I get the feeling that there are so many people who would like to do what I am doing, but there are things stopping them. If Singaporeans would be more confident in themselves and pursue what they want instead of living out the scripts handed to them by society, their parents and friends, I think there will definitely be more social entrepreneurs in Singapore.

5. What do you think about our project? In your opinion, would it be good or effective to raise awareness in this way?

I think it's very exciting and would love to see you succeed in your project. That would be so brilliant, if you can support, or contribute to supporting the old folks home. It's not a nice thing to always have to beg for donations and money. I used to get calls from fundraisers, when I was working, and you could tell they did not enjoy pestering you, but they had to do it because they just need the money. So good luck with the project!

6. Do you think our project is feasible?
Yes, for sure. You just need passion and dedication to make it succeed.

Monday, June 09, 2008

Singapore and Cambodian governments, jobs and aid

I got a called from the Al Jazeera TV station last week. It was their office in Kuala Lumpur in Malaysia, and they wanted to do a story on foreign aid and its impact on Cambodia. The researcher came across the blog and thought I'd be perfect for a contrarian view on foreign donations. This is because I state categorically that Bloom is NOT an NGO and why we refuse to register as one. Anyway, the TV station's panel discussion will take place in Phnom Penh on Wednesday (I have no idea when the show will be broadcast) and I have to miss it because Alan is away and I need to look after my dogs, which always come first.

I did reply to their question on why I disagree with the huge amount of donation this country receives (see below). At the end of the day, what is more effective in helping this country is not aid, but jobs. I am optimistic that eventually, Cambodia will make it. Khmers want to learn English and the government is trying to make this place more conducive for business. I am not sure the government bothers too much about improving the average Cambodian standard of living through foreign investment, but whatever--that improvement in the average Khmer life *will* happen. A happy consequence of FDI.

The former developing countries that have succeeded, like Singapore and South Korea, did so not through aid, but through industry. I cannot comment on South Korea but I've always thought that one of the reasons Singapore succeeded is precisely because we lack natural resources.

In resource rich countries like the Gulf states and African nations, there is really no compelling reason for the government to invest in its people. They can get rich simply through the land--oil, forests, plantations etc. You will find that these countries I mention do not bother with educating its people. In fact, in many ways, it makes sense for these governments NOT to educate its people--educated people tend to be troublemakers, challenging the status quo.

Contrast this with the case of Singapore, which has nothing--no land, no rice, not even our own water (we import this from Malaysia). There is no other way for the government to get rich, except through its people. That is why the Singapore government invested in our education and training--to make us a diligent workforce that would attract foreign investors. One of the ways the government can then make money is through taxation. A cynical or pragmatic view of politics? People often tell me how good the Singapore government is, for investing in our education, but I was never convinced that "good" means "altruistic" in this case.

So what do we make of the many, many governments in countries such as the US, Canada, Australia that have both natural resources and a firm belief in education? They're smart enough to recognise the country can only be as powerful as its people are? I don't know. I *do* know it has taken the west hundreds of years to get to where they are, and they had the industrial revolution which empowered many people, economically. Perhaps they had to invest in education because of pressure from their by now economically powerful people? I don't know the answer but the history of education should tell us, which is why I will go investigate.

Anyway, here is the gist of my answer to Al Jazeera:

"I believe regular and constant handouts create a dependency mentality that is ultimately detrimental to people--and not just Cambodians. You can draw comparisons with the welfare system in developed countries, which I think discourages work and independence, replaces pride with poor self-esteem and marginalises instead of integrating people into economic and community life. All over the world, welfare benefits have created people who are dysfunctional--whether the indigenous people in the US, Australia or Canada. These "beneficiaries" are often stuck in a cycle of drug and alcohol abuse, violence and despondency.

"I believe there is value and honour in work, and it is work that often makes life interesting and worthwhile. We feel a sense of achievement when we create something of value and we share a sense of belonging when we work alongside other people. With Bloom, we are taking small steps for Cambodians to learn a skill and a trade so they can produce and sell quality products that people all over the world want, thereby, be part of the international trading community."

Saturday, June 07, 2008

Almost Three in Four Cambodians have paid a bribe in 2007

And 20 to 30 per cent of Cambodia's land is owned by 1% of the population (!) From www.business-anti-corruption.com

Also, a 2007 survey conducted by Transparency International, 72 percent of Cambodians reported paying a bribe to receive a public service. This percentage is the highest in the Asia-Pacific region and second only to Cameroon (79 percent) internationally.

I wonder if this includes the parents who send their kids to school. Cambodian children who attend state schools have to pay 500 to 1000 (USD0.25) riels everyday to their teacher, ostensibly for extra tuition classes. And no wonder, considering teachers here earn a pitiful USD50 a month (less in the provinces).

More information about Cambodia's corruption can be found in this UPI Asia article by Lao Mong Hay, a senior researcher at the Asian Human Rights Commission in Hong Kong who was previously director of the Khmer Institute of Democracy in Phnom Penh, Cambodia. UPIAsiaonline.com

I was interested in the topic after reading about Cambodian activists who submitted an anti-corruption petition with over one million signatures to parliament in May.

Cambodia is ranked 162 out of 179 countries in Transparency International's 2007 corruption index--an appalling statistic, considering Zimbabwe ranked 150.

From the UPI Asia article: "Another survey conducted two years later by the Economic Institute of Cambodia in Phnom Penh showed that in 2005 the private sector paid “unofficial fees”—that is, bribes – to public officials amounting to US$330 million, an amount it said was “2.5 times higher than that of official payment” and “represented also about 50 percent of the total government budget revenue in 2005.”

In 2006, the World Bank suspended contracts with Cambodia after finding evidence of corruption and fraud in 43 contracts. But this was reinstated In 2007, apparently the World Bank was happy with the good governance framework the Cambodian government came up with.

Privatisation has made things worse. Fully or partially privatised sectors include transportation, health care, education, bank but also agricultural public companies such as the rubber plantations, the fertilizer company, fish export company. "The process of privatisation has resulted in many of the state-owned companies, as well as much land concessions, being awarded to high-level politicians and their cronies. In fact 20 to 30% of Cambodia's land is owned by 1% of the population.

"Cambodia is a cash-based economy, which also makes corruption easier. Many business transactions are made in cash. Only 1% of working capital comes from the commercial banks."

Friday, June 06, 2008

Cambodian prostitutes protest police crackdown

In yesterday's news: Two hundred prostitutes protested peacefully in Phnom Penh. They said they had been unlawfully detained, and then beaten and raped by guards at the rehabilitation center where they were held. I quote from the AP article

"Some of them (the sex workers) were beaten and gang raped by the center guards, and most of the time they did not use condoms," said Chan Dina, a 31-year-old prostitute and member of the Cambodian Prostitute Union, a sex workers' advocacy group.

"Pich Sokchea urged the government to end the crackdown because it was affecting the livelihood of sex workers, many of whom were forced into the profession by poverty and debts. "We are people who sacrifice everything for the sake of our families and for our livelihood."

"Police Lt. Gen. Khieu Sopheak, the Interior Ministry's spokesman, dismissed claims that police committed violence against sex workers and said none was mistreated in the crackdown. He defended the crackdown, calling sex work unacceptable in Cambodia."

http://ap.google.com/article/ALeqM5iyJ-JyIbPDfhPBVGJVDXCd5DTRGwD913BI080

The Interior Ministry's spokesman comment epitomises the hypocrisy that exists in this country. Publicly, Khmer officials and society condemn the sex trade, but privately, many of them engage in it, visiting prostitutes, taking on mistresses (make no mistake- this is also sex trade) and even making money from it.

From a BBC programme: "A few months ago, another foreign group working to protect children from the sex industry organised a raid on a brothel. It turned out the place was owned by a particularly powerful policeman."

http://news.bbc.co.uk/2/hi/programmes/from_our_own_correspondent/4078304.stm

Human rights groups estimate that out of as many as 100,000 prostitutes in Cambodia, one third are underage (younger than 18).

Thursday, June 05, 2008

Real Estate Boom in Cambodia's Capital


"Since Cambodia is still a very poor country that has never seen so much investment capital flying around, the trend is unnerving some observers. "Where is the money coming from? Cash coming out from under the mattresses, cash coming from overseas," says John Brisden, vice-chairman of Acleda Bank, the largest bank in Cambodia. He calls the real estate boom "very unusual" because much of it is not being financed by bank loans. Are there signs that the boom may be running its course? Brisden doesn't see a sudden popping of the bubble. Instead, he says, "people envision a slowdown. The scenario is a lot of empty high-rise properties but no forced sales." Businessweek

I met a woman in Phnom Penh whose landlord sold the Sisowath Quay property for USD3.5 million last month. This woman ran a fairly large restaurant on his site and had to move. USD3.5 mil! How can the buyer think he can make back the money? Cambodia's average income is still USD50 a month.

To me, property prices here are driven by speculation, and are not grounded in reality. When there are empty high-rise properties, it will cause a ripple effect, driving down rents and sale prices of other properties, affecting the entire economy (see how home prices have affected the US economy now)--even if as the Acleda Bank guy believes, there will be "no forced sales" of those high-rises owned by the filthy rich.

This same woman also told me how her landlord got to be so rich, basically by squatting in villas that were empty after the war. After the Khmer Rouge were defeated, people started straggling back to their home towns only to find them deserted and destroyed. Those who squatted are benefitting now. The sad thing is this Khmer woman blames her father, "a true communist", she said, for not being clever enough to grab more property when others were doing so. She believes the land grabbers are the smart ones, whereas people like her father, who concentrated on building the country after the war, are the stupid ones--working all their lives for "nothing".

Tragic. It is just like my family back in Singapore and Malaysia who think: if you are so clever, why aren't you rich? And conversely, if you are rich, you must be clever. To me, clever are people who come up with a medical cure, or invent something useful--not people who become rich by accident or by cunning. But it is a sad fact, as one of my Khmer friends confirmed. His family blames him for taking on an NGO job that doesn't pay as well as a job in a private company. My friend does it because he is kind and wants to help his country, but gets no thanks from his family.

More from Businessweek:

"The Phnom Penh skyscrapers, which will be more than three times higher than the tallest existing building in Cambodia, are the most dazzling projects. And the most controversial. The developer of the $240 million Gold Tower 42, Yonwoo Co., expects construction to take three and a half years to complete. Already, says Teng Rithy, sales manager for Gold Tower 42, "high-ranking Cambodians and some foreigners from other Asian countries" are plunking down deposits. "We are 80% sold out," he boasts.

"But residential skyscrapers are a new concept in a country that not too long ago was still giving away property, not trying to market a 40th-floor condo for $1.6 million. "I feel it's a little bit early for that," says Sung Bonna, head of Bonna Realty, one of the leading real estate firms in Cambodia. "They said it's going to be a success. But I don't know. If it doesn't happen, it is not good for us."

"Bonna says the whole idea of a real estate market in Cambodia is so new that no one can predict how it will turn. "We used to share property, not sell it. After the Pol Pot regime, however many properties you want, you can take all of them." He says there is a need for more modern restaurants, office buildings, and commercial centers, but the supply and demand for residential properties is in balance."

Update: June 7: I just saw this message on khmer440.com

"Posted: Sun May 25, 2008 6:00 pm Post subject: Property prices
Across the Jap bridge they are asking $200,000 for properties they sold for $60,000 only 2 years ago.
In America you can buy a 5 bedroom detached with swimming pool that cost $450,000 2 years ago for $180,000 now.
My house in the UK has dropped in value by $80,000 in the past year.
Where the fuck do they get these prices from in Cambodia."

My sentiments exactly.

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