Wednesday, October 18, 2017

Greek Black Market Spurred by High Tax Rates


By: Lindsey Curnutte
Produced & edited by: Trianna Connolly

About 21 percent of Greece’s GDP is going unaccounted for, according to a recent study from the Institute for Applied Economic Research, at the University of Tübingen (IAW).

Greece has the highest percentage of unaccounted for GDP according to 2017 study.
Photo Courtesy: forbes.com

This means nearly one in five euro notes changing hands in Greece are not taxed, making its shadow economy, also known as the black market, the most established among developed OECD (Organization for Economic Cooperation and Development) countries.

“The size of the shadow economy and the levels of corruption in Greece have been and still are particularly high with respect to other developed OECD countries,” the IAW study reads. “Moreover, the political dimensions of the Greek crisis… suggest a correlation between the size of the shadow economy and the levels of corruption.”

Greece is struggling to recover from a nearly decade long economic crisis. The IAW study may legitimize some experts’ opinion that austerity and high tax rates are not the solution to the government’s debt issue.

“Greece appears to have suffered a slump overwhelmingly because of the austerity,” Paul Krugman, a Nobel Prize-winning economist, said in 2015. “Surely there’s no grounds for dismissing this impact as a mere fraction of the problem.”

Why Greeks Avoid Paying Taxes
The Greek practice of evading taxes may be more common that American’s might expect. Kathimerini, a Greek newspaper, reported that government data show thousands of taxpayers finding loopholes to avoid declaring their incomes to tax authorities.

“It is very common in Greece to not pay taxes, there is even a political movement against paying them,” said Josephine Lazaridou, a 25-year-old lab technician from Kalava, Greece. “I think one of the main reasons, especially for business men, is that we have a really high value added tax on some products. So some people, in order to stay in business, have to claim less.”

Greece has one of the European Union’s highest value added taxes (VAT), which can be up to 23 percent on industries like wine and gambling. Hungary tops the list with a 27 percent standard VAT rate.

Wine on the Black Market
Some say high VAT rates have led to an expanded black market for wine. Yiannis Vogiatzis, a wine merchant in northern Greece, told Kathimerini that experts estimate 65 percent of wine consumed in Greece is produced and sold illegally.

Winemakers blame this developing black market on the controversial VAT placed on wine starting in 2015.

“The excise tax has ultimately acted as a punishment for those who want to do business legally,” Vogaitzis, also president of The National Interprofessional Organization of Vine and Wine of Greece, said.

The excise tax, which was sought to be a replacement for a failed value added tax on private schooling, was expected to bring 65 million euro in revenue per annum. As of June 2016, the wine tax collected 4 million euro, a fraction of the expected number.

Theodore Georgopoulos, director of The Greek Wine Federation, said winemakers face severe problems due to the excise tax. Wineries are required to pay 10,000 to 20,000 euro upfront for the tax, even for wine they had not yet sold.

“And bigger wineries have to organize tax warehouses,” Georgopoulos said. “They were asked to organize them in a week or so.”

A vineyard located in Greece.
Photo Courtesy: pixabay.com
Because of the high cost of compliance, over half of winemakers have turned to participating in a “highly organized” black market in wine, said George Skouras, president of the Greek Wine Association, and a winemaker in Nemea, Greece’s biggest wine-producing region.

“They have built tanks underground so they can’t be spotted by inspectors and have people scouring the countryside to buy grapes illegally, without invoices, off the books,” Skouras told Kathimerini in 2016.

Georgopoulos blames the hastily enacted regulation and poor enforcement for the expansion of the black market for wine.

“From the very beginning, The Greek Wine Federation was against the excise duty,” Georgopoulos said. “We reckon the need for contributing to the recovery of the Greek economy. However, the way the whole operation was planified... we knew this could not work.”

The Black Market and Tax Fraud 
The International Monetary Fund (IMF) reported that black markets thrive in countries like Greece that have high tax rates, expansive regulations, and weak, corrupt governments.

“A heavily regulated economy combined with weak and discretionary administration of the law provides especially fertile ground for shadow activities. These are also the conditions under which corruption flourishes,” the IMF report reads.

IMF recommends implementing lower tax rates and few regulations in order to achieve greater compliance.

“Our findings emphasize the importance of the rule of law in curbing both corruption and associated shadow economic activity.”

While the IMF report found simple solutions to limiting tax evasion, many Greeks like Georgopoulos have pessimistic views on the government’s ability to curb a tax-dodging culture in Greece.

“Tax fraud is like sin,” Georgopoulos said. “Once you taste it, it is very difficult to go back. It is an ethical matter as well as a matter of habit.”

Some estimates put the amount of taxes evaded to be at 11 to 16 billion euro annually, reaching 6 to 9 percent of Greece’s GDP.

“My godfather does not pay his taxes because he is against it generally,” Lazaridou said. “He is angry with this economical situation that we are going through and refuses to give more and more without a future prospect for him and his family.”

With this being said, relief may be on the way for Greek winemakers and drinkers. Evangelos Apostolou, minister for Agricultural Development and Food, announced plans to abolish the excise tax that brought less than desired financial results by the end of the year.

“It is the only way that can stabilize the country's path towards a period of positive prospects after the crisis and the deep recession that it experienced in the past years when about 25% of its GDP disappeared," Apostolou said at an August wine festival in Nemea, Greece.

**Global Spotlight is a nonprofit educational production, constituting a ‘fair use’ of any such copyrighted material as provided under Section 107 of the U.S. Copyright Law.  

Thursday, September 28, 2017

Can Tunisia Set the Template for Responding to Climate Change?

By: William Edwards
Produced & edited by: Michelle Michael

In the more than 3,000 hours of sunlight that the southern half of Tunisia soaks in a year, an increasingly energy-hungry Europe sees an opportunity.

That’s why the European Union, eager to partner with a politically stable nation in North Africa, has agreed to invest in a cable and solar power plant that would send energy directly to Malta, Italy, and France, if the involved governing bodies can come to a deal.

While the E.U. would stand to benefit from an agreement, economists believe a successful negotiation will benefit Tunisia, too. The project would provide substantial economic relief to the country, which expects to see a decrease in resources like water, crops, and energy stemming from climate change.
The country plans to start exporting solar energy from the Sahara to Europe

“Tunisia has a huge potential in renewable energy that—if it is valued—could help the economy to grow rapidly,” said Dr. Aram Belhadj, an assistant professor of economics at the University of Carthage. “Paying attention to solar energy could resolve many social and environmental problems that could threaten the whole Tunisian transition process such as unemployment, regional inequality, air pollution, and water scarcity."

Climate Change in Tunisia

Tunisia is not among the countries that are most culpable for climate change. According to the country’s Ministry of Environment and Sustainable Development, it only contributes 0.07 percent of the world’s total carbon emissions.

But culpability bears no relation to who will inherit the consequences of climate change. Tunisia, who in 2014 acknowledged in its constitution the government’s duty to protect its citizens against the rising global threat, knows it is on the losing side of the looming crisis.

It will see its landmass, with half of its border on the Mediterranean coast, shrink because of rising seas. It will continue to endure hotter summers; suffer from harsher droughts; and as a result, likely see a decrease in the production of crops like olives, dates, and grain—exported commodities that play a crucial role the country’s agriculture industry (according to the Oxford Business Group, these account for about nine percent of the country’s GDP).

“What I’ve experienced on my land is that we’re now five months without rain” said Malek Lakhoua, a physician who also operates his family’s olive farm, Domain Sidi Mrayah, in Zaghouan, about 35 miles south of Tunis. “We see a decrease in the rate of the rain in general, and also a period of rain which is not tolerant of the growth of the trees... This kind of change influences the quality and especially the taste of the olives.”


Agriculture, Irrigation & Economy

Part of an olive press in Tunisia. Photo courtesy: Dennis Jarvis via flickr
Olive oil is Tunisia’s most lucrative agricultural export—they are consistently one of the world’s largest producers of it. The warming temperatures will have the greatest impact on small farms like Lakhoua’s, which he says produces about 5,000-6,000 liters of olive oil per year. Conditions worsen when farms get farther south in the country and closer to the Sahara Desert. Larger farms who can afford to adequately irrigate their crops are less affected at the moment.

In the absence of irrigation opportunities, there is a risk of tree loss. However, comparatively remunerative olive oil prices—with strong international demand in recent years—encourage farmers to irrigate,” said Dr. Mohamed Salah Bachta, a professor of agro-economics at the National Institute of Agronomics in Tunisia. “Some farmers have adopted intensive systems—irrigation that has a high density per hectare.”

However, if water continues to become more scarce, it will become harder for farmers to afford intensive irrigation without raising their prices. According to Cairo Jennings, a United States diplomat who worked in the U.S. Embassy’s Environment, Science, Technology and Health portfolio in Tunis from 2015-2017, Irrigation also becomes logistically more difficult over long distances because of surface evaporation and the high cost of installing pipes.

A lack of water from severe droughts will also lead to greater food scarcity within the country—the country already imports half of its food, according to Jennings—and affect the energy supply as well, as the country harvests hydroelectric power from dams. This is where solar energy, both through exporting it and using it within their borders, could help the country, he said.

“Tunisia’s trying to sell this as ‘Hey, you pay to put in this power interchange and we will build out our solar capacity in the desert and you can basically use us as your power plant,” Jennings said. “If they could sell electricity to European markets and get paid in Euros, then that would be extremely supportive of their economy.”


A Role Model in the Arab World

Solar panels on the rooftop of a house in Sayada, Tunisia.
Photo courtesy: Wikimedia Commons
Since the 2011 Arab Spring, Tunisia has been seen by the West as an example for other countries in North Africa and the Middle East. It has the longest surviving democratic government since the revolution. It has recently made humanitarian advances in overturning laws that the government deemed unfair to women. Now, economists say, a solar deal could make Tunisia an economic example, too, for its neighboring nations.

“Countries like Libya and Egypt could develop a new economic model based on high added-value sectors, notably renewable energy,” Belhadj said. “Diversifying the economy, decreasing the weight of fossil fuels, and developing new exports strategy could then boost the growth and secure the current citizen welfare—without jeopardizing the future generation’s wellbeing—in these countries.”



Global Spotlight is a nonprofit educational production, constituting a ‘fair use’ of any such copyrighted material as provided under Section 107 of the U.S. Copyright Law.  

The Ancient Problem of Building a Jewish Temple in the Old City of Jerusalem

By: David Lee
Produced & edited by: Michelle Michael 

A three-million-dollar golden menorah and harps of ancient Israelite King David costing thousands of dollars among other sacred vessels are commissioned and safeguarded by the Temple Institute in Jerusalem. As an organization that educates and collects vessels once included in the holy services of Israel’s first and second temples, the Temple Institute is the most established Jewish organization with prophetic objectives in the Temple Mount.

“We make many harps for [the Temple Institute] and many of these harps are donated by people around the world,” said Micah Harrari, who is regarded as the “official” harp maker for the temple restoration.

“When we went into exile 2,000 years ago, it is said that we hung our harps along the willows because we would not play our music in a strange land,” said Harrari. “And since we returned to the land, we restored the harp.”

Micah and his wife Shoshanna made their Aliyah, or return to the Land of Israel, from the United States in 1982. They are one of the many artists and engineers working with the Temple Institute to fulfill an ancient promise found in the Tanakh—the Hebrew Scriptures. Like the other vessels preserved by the Temple Institute, Harrari’s harps are designed on information from the Tanakh, the Talmud, and archeological findings.

A model of the Second Jewish Temple.
Photo courtesy: Wikimedia Commons
As Harrari’s harps are sold to the Jewish diaspora around the world, countries outside of Israel have been major contributors to the efforts—especially financially. The United States hosts the second largest Jewish population—according to the Berman Jewish Data Bank, there were 5.7 million American Jews in 2015.

Mystery of the Red Heifer 

Rabbi Chaim Richman, Director of the International Department at the Temple Institute, traveled to Canton, Mississippi in 1994 to meet with Minister Clyde Lott of the Canaan Land Restoration of Israel, Inc. Lott was willing to send red heifers—young, virgin female cows—to Jerusalem to fulfill the prophetic belief that the next red heifer to appear in Israel would also entail the arrival of their messiah or the end times.

Lott and Richman were unavailable to provide comments. However, the office of Reverend Alfred Bishop, the treasurer of the Canaan Land Restoration of Israel, Inc., was available to comment.
“[The farm in Mississippi] never did have a cow that passed the test, because the cow has to be perfect—everything has to be red and no white hair,” said the anonymous source at Bishop’s office.    

There is another group that also believes in the mystery of the red heifer and even started the temple restoration efforts 20 years before the Temple Institute. Since the end of the 1967 Six-Day war—when Israel was victorious but decided to give administrative control of the Temple Mount to Jordon—Gershon Salomon has been leading the Temple Mount Faithful Movement.  The movement’s foremost goal on its website reads, “Liberating the Temple Mount from Arabic (Islamic) occupation.”
“So, our goal is to move this enemy from the Temple Mount and repair it, purify it, and rebuild the temple,” said Salomon.

He thinks a reestablished temple in Jerusalem will soon open a stage of peace and morality for the world.

The Muslim community certainly does not agree with Salomon’s statements. Jordanian security forces restrict the number of Jews and types of Jewish activities at the holy site. Amid rising tensions in the area, Israeli Prime Minister Benjamin Netanyahu promised a stop to Israeli politicians visiting the Temple Mount.

Shuli Mualem, one of the first Israeli politician
to ascend the Temple Mount. Photo courtesy: Wikipedie

"A House of Prayer for All Peoples"

After a two-year ban, Yehuda Glick—a friend of the Temple Institute and a survivor of an assassination attack in 2014—and Shuli Mualem became the first Israeli politicians to ascend the site in recent memory.

“Our aspiration is for this place to fulfill its purpose as it is written in the Bible—a house of prayer for all peoples,” said Mualem.

Mualem is part of the growing support from government officials and other non-profit organizations towards the religious activism efforts. According to a 2015 study by PewResearch, the biggest proportion of the Jewish population in Israel and the United States—the largest homes for Jewish people—are identified as Hiloni (secular) or non-orthodox Jews respectively.

“In the second temple period, things really did center around the temple and today they don’t,” said Professor Daniel Schwartz, a history professor at the Hebrew University of Jerusalem.
He thinks the Jewish people have gotten more used to liberal lifestyles of equality and living in peace with neighbors.

“Today, the temple exists most in memories or hopes for the future,” continued Schwartz. “[The Jewish people] are much affected by the fact that there has been some 1,900 years of Jewish history between the destruction of the second temple and today, and Jews got used to dealing with God without having to move to a particular place.”

As the past international spokesperson for various movements, Yosef Rabin has been organizing efforts to popularize Jewish activism in the Temple Mount since his work with the Temple Institute in 2010.  

“This year, we passed the mark of 20,000 Jews coming to the Temple Mount in one year—when I started, it was 200 a year,” said Rabin.  

“You have a mass cross-section of society; you have groups that are extremely conservative, you have groups that are coming from not so much a religious, Jewish perspective but more of liberal values of religious rights for all,” continued Rabin.

He also agrees with Schwartz on the changing conceptions of temple worship in modern day Israel.
“In Jewish law, you can do most of the temple services without the physical building as long as the alter is in its proper place within what was the area of the temple,” said Rabin.


Even after thousands of years, the religious battle in Jerusalem has not stopped or lost much of its significance. But with changing times, many Jewish, Arabic, and Christian people today might agree with Rabin’s opinion that “[people] are not looking for any mass upheavals or war; we want to simply go up and pray to our God.”



Global Spotlight is a nonprofit educational production, constituting a ‘fair use’ of any such copyrighted material as provided under Section 107 of the U.S. Copyright Law.  

Mother Nature is Making Way in Modern Chilean Medicine

By: Trianna Connolly
Produced & edited by: Michelle Michael

Doctors suggest that the best way to get rid of a cold is to get a lot of rest, stay hydrated, and load up on vitamin C. What is the best way to help cure something that goes beyond physical health? The answer could lie within the traditional medical remedies of the Mapuche people.

Mapuche People and Alternative Medicine

Originally located in southern Chile, the Mapuche is a group of indigenous people. In recent years, they have been slowly branching out into the rest of the Chilean society. With them they bring knowledge of medicinal care that could revolutionize modern medicine.

The Mapuche, whose name means people of the earth, believe in the magical-religious properties of curative plants and herbs native to Chile. Some of these include triwe, refu, and wingam—all of which are used to get rid of evil spirits causing sickness. Their medicine provides patients a connection to the earth.

Although these remedies have been passed down through generations within the group, their mission is to share their tradition of healing to anyone who seeks it.
          
“More and more people are looking for benefits in medicine that go in better harmony with the body and soul,” Claudia Saavedra, a frequent user of Mapuche products said. Saavedra, a health professional in Chile, wants the Mapuche medicine to be incorporated into public health care programs so all Chileans can fully understand its benefits.

“It is out of respect for our roots,” she says. “It helps us see our bodies as a sacred temple that must be protected.”

Pharmacies around Chile are beginning to add Mapuche medicine to their shelves. The Mapuche have even created their own pharmacy brand known as Makelawen, which includes all their herbal products and remedies.
           
Ancient Mupache Machis.
Photo courtesy: Wikimedia Commons
The Mapuche healers, known as machi, use their medicine and wisdom to treat lifestyle illnesses such as sleep deprivation, obesity, and even terminal illnesses such as cancer.

“They see everything. They can see the color of your urine or your defecations or your eyes,” 30-year-old Marcarena Isabel Machdo Delpiano explains. Delpiano, a southern native, is familiar with the healing capabilities of Mapuche medicine. She says the healers can diagnose from observation alone.
           
The Mapuche treatments are diverse, extending to cosmetology and skin needs. “Once I had a really bad burn and my friend gave me a cream that was a Mapuche cream for burns and it was very, very good,” Delpiano said.
           
Many Chileans believe there is a growing concern for chemicals in modern medicine and Mapuche treatments are sold as natural, organic products.
             
Alternative vs. Modern Medicinal Practices
Public Health Care in Chile 

Even though this form of medicine may be gaining some traction among the Chilean population, according to Dr. Daniel Silva Naveas, it cannot be prescribed as a form of treatment unless it passes a filtering system similar to other drugs.
           
“Current medicine provides proven treatments to patients with the least possibility of risks. This implies that each prescribed substance must have studies that endorse its indication,” said Dr. Naveas, who specializes in mental health. 

However, Naveas is optimistic about such traditional practices, “it gives us [doctors] new therapeutic options to explore.”

“Normal doctors can recommend us that kind of medicine but not prescribe it because it doesn’t come from a laboratory,” 34- year-old Santiago resident John Thomas Cleveland Acuña said.

Psychologists often recommend this type of medicine to their patients because they do not have the same medical degree as most practitioners and they are unable to prescribe medicine.

The Ministry of Health in Chile wants to incorporate more traditional, organic medicine into the health care system outside a pharmacy setting. They hope it will improve health care for the Mapuche people and get them interested in seeing regular physicians.  

A modern hospital in San Pablo, Chile.
Photo courtesy: Wikimedia Commons.
“There have been instances of conversation between health authorities and representatives of the Mapuche people to extend their knowledge. It seems that certain hermetic positions on the part of the Mapuche make it difficult to achieve,” Naveas explains.

Chile’s current healthcare system is divided into two structures, a public and private sector which is inclusive for all Chileans, indigenous or not. Each of these sectors have issues that hurt the lower classes.

“Public health care is terrible…long queues, bad quality of services, not enough professionals. Private health care, although has more rapid health benefits [and] is restrictive in relation to the payment of insurance providers,” industrial engineer Nicolas Nardecchia said.

The citizens of Chile hope the government will understand that good health is a right of every citizen. For now, people can obtain Mapuche medicine, but on their own risk.

“Since all the ingredients are natural, people don’t take it very seriously even though they can be dangerous,” Acuña stated. Many believe “that you can solve all your problems with Mother Nature, but that is not always the case.”

**Global Spotlight is a nonprofit educational production, constituting a ‘fair use’ of any such copyrighted material as provided under Section 107 of the U.S. Copyright Law.