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Handling soil with care: Conservation Agriculture’s role in post-2020 CAP

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Handling soil with care: Conservation Agriculture’s role in post-2020 CAP

Despite being taken into consideration only slightly in the EU’s current farming subsidies programme, Conservation Agriculture is set to play a central role in the green architecture of the post-2020 Common Agricultural Policy (CAP).

Conservation Agriculture (CA) lends itself easily to misinterpretations, as the term ‘conservation’ often indicates activities involving the preservation and restoration of degraded natural habitats to improve biodiversity.

However, although CA also promotes biodiversity, it mostly addresses issues referring to a different phenomenon: soil degradation.

Soil organic matter has been increasingly depleted thanks to land-use intensification and mono-cultures, while the use of heavy machinery stresses the soil by causing ground compaction.

CA works to address this via a suite of farming practices designed to avoid physical degradation, such as growing a permanent protective plant cover on the soil and advocating for an agricultural production system based on a total or partial reduction of ploughing and tilling.

According to the European Conservation Agriculture Federation (ECAF), agronomic practices included in CA are based on three core principles to be fulfilled concomitantly: minimum soil disturbance, maintenance of permanent soil covers and cropping system diversity.

Advocators argue that these practices can bring economic savings for farmers in terms of energy efficiency, while also contributing to decreasing greenhouse gases emissions and building resilience of the agricultural system to climate change.

ywAAAAAAQABAAACAUwAOw== Handling soil with care: Conservation Agriculture’s role in post-2020 CAP

No-tillage and soil cover

Among the CA’s practices, no-tillage and groundcovers are the most widely known.

No-till, or reduced-till, agriculture is the practice of planting crops without tilling the soil, which is the conventional way of preparing the soil for planting by digging, stirring, and turning it over.

Although no-tillage and reduced tillage can help prevent run-off and erosion, the practices have been slow to take off in Europe.

According to the European Commission, reduced tillage or conservation tillage is practised on around 21.6% of the arable land in EU, while no-tillage is applied to only 4% of arable land.

In a parliamentary question filed last March, the Bulgarian MEP Atidzhe Alieva-Veli asked the EU executive whether it is going to promote the implementation of ‘no-till technology’ by including it as a green measure in the post-2020 CAP.

For the liberal lawmaker, “no-till technology is an approach that should be encouraged as a regenerative form of agriculture that ensures not only high agricultural productivity but also soil regeneration.”

Replying to Alieva-Velli, the Commission recognised the environmental and climate-related benefits of reducing mechanical disturbance of the soil, adding that the CAP already supports specific practices aimed to protect soil against degradation, including minimum or zero tillage, conservation of crop residues and green covers.

ywAAAAAAQABAAACAUwAOw== Handling soil with care: Conservation Agriculture’s role in post-2020 CAP

As for ground-covers, they refer to the periods of the year when the soil is covered by residues or crops, including catch or cover crops.

Cover crops are efficient in reducing soil and nutrient loss by keeping the land continuously covered with vegetation during the whole year.

In the EU-28 during winter of 2010, 44% of the arable area was covered with normal winter crops, 5% with cover or intermediate crops and 9% with plant residues, while 25% was left as bare soil and 16 % of the arable area soil cover was not recorded.

Putting the ‘CA’ in CAP

In the EU’s current farming subsidies programme, a number of measures relevant to CA were included in the rural development policy, known as the CAP’s second pillar.

Member states and regions can include these measures in their rural development programmes according to their specific needs and priorities.

Some aspects related to the main principles of conservation agriculture were also supported under Horizon2020, the EU’s funding for research, and the European Innovation Partnership on agriculture productivity and sustainability.

However, the real step forward for CA’s uptake is expected in the post-2020 CAP reform, as conservation agriculture practices can be promoted under the new system of eco-schemes, the ‘green architecture’ of the programme.

Eco-schemes are available under the direct payments framework, which constitutes the biggest chunk of EU farming funds.

CA practices are listed in three out of ten ‘Good Agricultural and Environmental Conditions’ (GAECs) of the new eco-scheme and include rotation, no ploughing, soil cover, winter crops and crop rotation.

The eco-schemes aim to reward farmers for going even further in the implementation of sustainable agricultural practices, beyond the mandatory requirements set by conditionality.

As proposed by the Commission in the future CAP, these types of practices can contribute to meeting the enhanced environmental and climate ambitions of the agricultural policy.

As in the previous programme, CA practices could be promoted through environmental and climate management commitments available under the rural development framework.

ywAAAAAAQABAAACAUwAOw== Handling soil with care: Conservation Agriculture’s role in post-2020 CAP

New terminologies in sustainable food systems

The recent drive for sustainability has seen the emergence of a number of new terminologies, including agroecology, agroforestry and urban farming.

The adoption of these new notions into the sustainability discourse has been rapid and has sometimes made new concepts difficult …

[Edited by Natasha Foote/Zoran Radosavljevic]

Jaswant Singh Khalra was remembered at the Human Rights Council

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ywAAAAAAQABAAACAUwAOw== Jaswant Singh Khalra was remembered at the Human Rights Council

On the occasion of the 25th anniversary of the death of Jaswant Singh Kharla CAP Freedom of Conscience, United Sikhs, Khalra Mission Organization and the author of the book The Valiant – Jaswant Singh Khalra  Gurmeet Kaur made a statement to the UN during the 45th session of the Human Rights Council.

According to the president of CAP LC,

“it is time for the truth to be revealed and for the families of the victims to know the truth about the fate of their loved one” and continued saying that “it is the duty of the Indian authorities to shed light on this crime against humanity”. (Their full statement can be seen here)

Jaswant Singh Kharla’s crime is to have uncovered, according to his book

“thousands of state-enforced disappearances, illegal detentions, custodial killings, and mass cremations of the Sikhs under government’s orders, which constitute the Sikh genocide”.

After its discovery Jaswant Singh Kharla  took as his mission to stop the “government’s tyranny” by exposing and “holding it accountable through legal means”. 

On January 16, 1995, he made public evidence of 3,100 illegal cremations of disappeared persons in just three crematoria from one out of the then thirteen districts in Punjab. He estimated there were a total of 25,000 cremations of disappeared persons throughout the state.

On September 6, 1995, Jaswant Singh Khalra  himself was abducted in broad daylight, tortured in illegal custody for 52 days before being shot dead; his body dismembered and dumped into the very canal that was used to dispose other bodies that he had set out to find.

Author Gurmeet Kaur who wrote The Valiant – Jaswant Singh Khalra said:

“Twenty-five years later, we hope the government will not obstruct efforts to document the gravity of the state-sponsored genocide before nature takes its course and the aging witnesses and parents of the disappeared die”.

Much Upside Left In Pinterest

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Much Upside Left In Pinterest

Lately, social media company Pinterest (PINS) has been in the news, mostly for the right reasons. Founded in 2010, the company is mainly a visual search engine that helps people share ideas about their hobbies and interests.

Like any other ad-based internet business, Pinterest has also experienced its share of disruptions due to the COVID-19 pandemic. Despite this, the stock is positioned much better than most of its peers on operational, strategic, and financial fronts. Pinterest is already up YTD (year-to-date) by 114.06%, while peers such as Snap (SNAP) and Twitter (TWTR) are up 51.19% and 36.79%, respectively.

The pandemic has forced many businesses to increasingly offer a range of digital solutions. This e-commerce growth will most likely fuel a rapid increase in the share of digital advertising. The importance of social media in connecting businesses and consumers is only going to increase further. Hence, although uncertainty is ravaging the global economy today, a stable and well-funded social media business like Pinterest can prove to be a big winner in the post-pandemic world.

ywAAAAAAQABAAACAUwAOw== Much Upside Left In Pinterest

Pinterest has been growing its subscriber base at breakneck speed, especially during the pandemic

The COVID-19 pandemic has been a blessing for Pinterest, with the user base growing much faster than what was warranted by the seasonal trends. With the relaxation of shelter-in-place restrictions, the company saw a moderation in user base expansion in May 2020. However, despite this, engagement levels have remained strong both in June and July 2020.

ywAAAAAAQABAAACAUwAOw== Much Upside Left In Pinterest

Not only has the subscriber base expanded at a very healthy rate, but customer engagement has also been pretty high. With an MAU (monthly active user base) of 416 million, the platform has been helping its customers to tackle various COVID-related use cases.

In the U.S., a significant number of older users have returned to the platform since the start of the pandemic. But the bigger jump came from Gen Z, where people under the age of 25 years has grown faster than those over 25 years.

Now, this highly engaged and fast-growing subscriber base is an underexplored monetization opportunity.

ywAAAAAAQABAAACAUwAOw== Much Upside Left In Pinterest

Agreed that the YoY revenue growth in the second quarter was only 4% and ARPU (average revenue per user) dropped YoY by 21%. But that was understandably an outcome of weak advertiser demand. Starting in May, Pinterest has seen demand from the CPG (consumer packaged goods) vertical on the back of robust demand for essential products.

ywAAAAAAQABAAACAUwAOw== Much Upside Left In Pinterest

Excluding the second-quarter performance, which has been an aberration, the company has managed to consistently grow revenues YoY, exceeding 30% since the second quarter of fiscal 2019.

There was also one major positive highlight even in the second-quarter revenue performance and that is the company’s solid revenue and ARPU growth in international markets. The company’s investments in developing direct coverage and sales support functions in English-speaking markets outside the U.S. and in Western Europe seem to be now bearing fruit.

The international business remains a major opportunity, considering that it accounted for 15% of second-quarter revenues despite making up almost 75% of the user base. Pinterest is focused on replicating all of the ad-tech tools, insights, and formats which worked in the U.S., to leverage the international market opportunity. The company has also recognized that the majority of ad-spend in Europe happens through agencies. Hence, Pinterest is working on developing tools that would help ad agencies. The company is also seeing untapped revenue opportunities in Latin America and parts of Asia-Pacific.

What differentiates Pinterest from peer Twitter is a pretty clear roadmap towards the monetization of its customer base. The company remains confident in monetizing most of its global user base in the next two years. The company has also been aggressively deploying automation tools such as automated bidding for conversion optimization and tag adoption through partners such as Shopify (NYSE:SHOP) and Google Tag Manager (NASDAQ:GOOG) (NASDAQ:GOOGL) for increased conversion visibility. These tools, coupled with effective measurement of business metrics and improved shopping experience on the platform, are expected to play a pivotal role in convincing small- and medium-sized businesses to direct their ad dollars towards Pinterest.

ywAAAAAAQABAAACAUwAOw== Much Upside Left In Pinterest

Pinterest has guided for third-quarter revenues to grow YoY (year-over-year) in the mid-30s percent range, despite assuming deceleration in growth rates starting July associated with back-to-school environment and COVID-19 uncertainties. Analysts are also estimating solid double-digit revenue growth for the company for many more years to come.

Social commerce is another major monetization opportunity for Pinterest

Pinterest has been working to reduce its complete reliance on ad spending. This strategic move could not have come at a better time. The changed consumer behavior triggered by the pandemic will be a major growth driver for social commerce. The social commerce market is expected to grow at a CAGR (compounded average growth rate) of 31.4% from $89.4 billion in 2020 to $604.5 billion in 2027.

In May, Pinterest partnered with Shopify (SHOP). This can prove to be a very lucrative collaboration, considering that the Pinterest community is known for high shopping intent, with almost 80% of the users basing their shopping decisions on pinned items.

According to the press release, “The new channel will allow U.S. and Canadian merchants to tap into this audience to seamlessly turn existing products from their store into “Product Pins” on Pinterest, as well as add a shop tab to their profile on Pinterest, for free organic promotion. Shopify merchants can also promote their pins as a paid ad, bringing customers directly into their brand’s online store for purchase.”

This partnership is expected to bring in a significant amount of purchase commissions for Pinterest, which can provide the much-needed acceleration in its ARPU in the coming quarters.

The company has a robust balance sheet and positive cash flows

Despite the very promising growth story and all the investments that are going in to monetize the ever-expanding opportunity, the company has managed to maintain a strong balance sheet. Pinterest had a cash balance of $1.7 billion and total debt of only $151 million on its balance sheet at end of June 2020. The company’s net operating cash flow was $37.80 million, while free cash flow was $146.32 million for the period from July 2019 to June 2020.

There are a few risks to consider

Although Gen Z has been seen to engage more with the Pinterest platform and explore more of its newer functionalities and services, this may not be the preferred demographic for advertisers. With a growing chunk of the subscriber base belonging to the less wealthy category, advertising rates may take some hit in the coming quarters.

Like any advertising dependent media company, Pinterest’s growth is also invariably tied to the rate of economic activity. Signs of slowing recovery can be seen, as the impact of fiscal stimulus seems to be drying up and new COVID-19 cases continue to emerge. Pinterest had been seeing a gradual improvement in ad demand from the low of April to pretty strong demand across verticals and objectives in July. However, a significant part of this demand, especially in sectors such as retail, travel, restaurants, and automotive, depends on the macroeconomic environment. Historically, retail has been a major ad-spend driver for Pinterest and the ongoing pace of retail store closures can be a major headwind for the company. While ad-spending from pure-play e-commerce and direct-to-consumer retailers has been at healthy levels, these businesses form a small part of the company’s sales mix. Hence, we see that a more prolonged economic recovery can have a detrimental impact on ad-spending and affect Pinterest’s financial performance at least in the short run.

Third-quarter earnings performance will now include a one-time payment of $89.5M, to cancel the lease on the new San Francisco space. Although a hit in the short run, this move can save the company’s annual capital spend by around $440 million.

Verdict

Pinterest is trading at a P/S (price-to-sales) multiple of 18.89x, quite above the 10.27x multiple of Twitter and somewhat more than 18.57x multiple of Snap (NYSE:SNAP). Yet, I believe that there remains upside in Pinterest based on secular tailwinds coupled with a very focused company strategy. A top-line growth over 30% is quite difficult to get at P/S multiples below 20x. Hence, Guggenheim analyst Michael Morris’ price target of $48 seems to be achievable in the next 12 months. You can check other analysts’ ratings and target prices here.

Considering the uncertainties posed by the ongoing pandemic, Pinterest seems to be a good pick for growth investors for retail investors with slightly above-average risk appetite.

Disclosure: I/we have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

Food loss and waste ‘an ethical outrage’, UN chief says on International Day

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Food loss and waste ‘an ethical outrage’, UN chief says on International Day

Last year, the UN General Assembly designated 29 September as the International Day, recognizing the fundamental role that sustainable food production plays in promoting food security and nutrition and highlighting the essential need to reduce food loss and waste. 

In addition, with the COVID-19 pandemic underlining the fragility of food systems, and worsening food loss and waste in many countries, Secretary-General António Guterres called for “new approaches and solutions” to solve the challenges. 

“Food loss and waste is an ethical outrage. In a world with enough food to feed all people, everywhere, 690 million people continue to go hungry and 3 billion cannot afford a healthy diet,” he said. 

Squandering natural resources 

“Food loss and waste also squanders natural resources – water, soil and energy, not to mention human labour and time. It worsens climate change, given the significant role of agriculture in generating greenhouse gas emissions,” added Mr. Guterres. 

According to the UN Food and Agriculture Organization (FAO), around 14 per cent of food produced globally is lost between harvest and retail, with significant quantities also wasted at the retail and consumption levels. The figure is higher in the case of fruits and vegetables, where more than 20 per cent is lost. 

When food is loss or wasted, all the resources that were used to produce it – including water, land, energy, labour and capital – go to waste. In addition, the disposal of food loss and waste in landfills, leads to greenhouse gas emissions, contributing to climate change, said FAO. 

Sustainable Development Goals 

The critical issue of reducing food waste is also highlighted in the Sustainable Development Goals (SDGs), with Goals 2 and 12 calling for achieving zero hunger, and halving food waste and reducing food loss by 2030, respectively.  

“While many countries are taking action, we need to step up efforts,” said the Secretary-General, highlighting that the inaugural observance of the International Day of Awareness of Food Loss and Waste comes as the world prepare for the 2021 Food Systems Summit

“I urge countries to set a reduction target aligned with SDG 12, measure their food loss and waste and act boldly to reduce it. Policy action in this area should also be included in climate plans under the Paris Agreement [on Climate Change],” he said. 

Many businesses should take a similar approach, continued Mr. Guterres, calling on Individuals to shop carefully, store food correctly and make good use of leftovers. 

“Let us work together to reduce food loss and waste for the benefit of people and our planet,” added the Secretary-General.

COVID-19: ‘Legitimate concerns’ must be heard, and fears addressed over misinformation

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COVID-19: ‘Legitimate concerns’ must be heard, and fears addressed over misinformation

On the margins of the General debate of the UN General Assembly, UN News spoke to UN Under-Secretary General for Global Communications, Melissa Fleming, and from the World Health Organization (WHO), Dr. Sylvie Briand, Director of Pandemic and Epidemic Diseases.  

In a joint interview as part of the UN’s SDG Media Zone coverage, they discussed how important it is for the UN to engage with the public, and highlight international collaborative efforts to develop effective and affordable vaccines for all. 

Misinformation is not new … We’ve had misinformation as far back as you look in history. The difference here is that we have a global pandemic that is happening in the social media age – Melissa Fleming

Many firsts 

“What is difficult in the current period is, first, there is a lot of fear of the disease and a lot of anxiety from the population, as well as a lot of uncertainty”, said Dr. Briand. “It is a new disease. Many things are first time in this pandemic. 

“Misinformation is not new”, said communications chief Fleming. “We’ve had misinformation as far back as you look in history. The difference here is that we have a global pandemic that is happening in the social media age.” 

Communications emergency 

In a video message broadcast at a high-level event on mitigating the harm from misinformation and disinformation on 23 September, UN Secretary-General, António Guterres, said COVID-19 was not just a public health emergency, but it is a communications emergency too and that as soon as the virus spread across the globe, inaccurate and even dangerous messages proliferated wildly over social media, leaving people confused, misled and ill-informed. 

According to Dr. Briand, when people are anxious and uncertain of a number of things they tend to compare with things they know already or things they have experienced in the past.  

Regarding the COVID-19 vaccine, she noted that people “have already preconceptions about vaccines or fear about other vaccines”.

What is very important in this period now … is to really start building a space for a very open dialogue, a two-way dialogue with the population so we can hear their concerns and answer them – Sylvie Briand

“What is very important in this period now, because we don’t have yet the vaccine, is to really start building a space for a very open dialogue, a two-way dialogue with the population so we can hear their concerns and we can answer their concerns for as much as we can”, she added. 

Ms. Fleming said people’s fears and concerns were legitimate, “and we want to be listening to them and addressing these fears and concerns with information they can access and understand”.  

A high-level event is taking place later on Tuesday, on how to tackle the coronavirus together through the ACT-Accelerator initiative, launched in April as a global collaboration to accelerate the development and production of diagnostics, treatments and vaccines on an equitable basis. 

UNICEF/Gabreez

Saba, 23, a community health worker in Amran, Yemen, spends her days meeting people and informing them about vital health information, including COVID-19 and how families can protect themselves.

Reaching out 

The head of UN Global Communications (DGC) believes the Organization has the means and the valuable opportunity now to reach people everywhere “with good information, (and) solid public health guidance based on science”. 

But “there is not just good information circulating out there”, it is “mixed with bad information, bad science produced by bad actors”, she told UN News.  

“The result is that the public on the receiving end, is having a really hard time navigating and distinguishing between what is good and what is bad, what is misinformation and what is disinformation and what really is information based on science”, she added. 

“That’s where we come in” on the department level, she noted, with the ability to communicate the scientific facts “in a way that is more accessible, more interesting, more social media-optimized so that it does go into people feeds. 

Stressing the importance of accurate information, it was important to let people know “how to spot it and how to talk to friends and family about the kind of misinformation and conspiracies that they are being exposed to, and maybe believing”, said the communications chief. 

Verified campaign 

The Department of Global Communications has pioneered an initiative to counter misinformation, through the Verified campaign. It offers content based on science, content that is simple, accessible, and relatable.   

“We are working with social media platforms, we have recruited information volunteers, who are our kind of digital first responders around the world, members of the public who are communicating for us in their communities with the content that we provide”, Melissa Fleming explained. 

A recent study conducted by researchers from Harvard University and three other universities, suggests that under-25s in the United States are most likely to believe virus-related misinformation about the severity of the disease and how it originated.  

“I think that is probably a reflection of who is most on social media. It is a younger population, that is getting a digital overload and so their attention span is probably not long enough to look at the piece of information they are getting and really question it”, said Melissa Fleming. 

Pause before you post 

Part of the initiative is to get people to stop and think, before they post: “What Pause does, is introduce a new social norm, kind of like the campaign, Don’t drink and drive, for example”, the UN official explained.  

“What we want our new social norm to be is, pause, take care before you share. And for people to be educated, we are going to be pushing more information out to young people, and everybody, about how much misinformation is out there (and) how to spot misinformation”. 

“We believe and we have evidence to believe, that if people took this 30 seconds break, and really question what they were seeing, this would go a long way to stopping the spread, but it is not going to stop it completely”. 

What is also need is “more work by the social platforms to not just flag misinformation but really stop it in its tracks”, she added. 

According to Dr. Briand, “because people are overwhelmed with information, it is very hard for them to distinguish what is good and what is bad”. “But we think that if you give more good information to people so that they can make informed decisions about their health, then they are less likely to listen to misinformation”, she said.  

WHO is working with young people so they feel part of the solution and not ostracized for being spreaders of the coronavirus: “We work with them to change this perception”, she added. 

“The most important thing is to work with communities at local levels”, said Melissa Fleming. “We need to think globally but go local. Think globally about the solutions to COVID-19, about the vaccine, no one is safe until everyone is safe”. 

WHO and EU help healthcare workers during COVID-19 in Uzbekistan

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pexels-photo-3993241.jpeg
Photo by CDC on Pexels.com

TASHKENT (TCA) — The European Union has provided more than EUR 2 million for a project focused on effective, rapid, and coordinated response to COVID-19 in Uzbekistan. The project, which will be implemented by the World Health Organization Country’s Office, will focus on a particular emphasis on provision of personal protective equipment to health and first-line workers in healthcare facilities, the Delegation of the European Union to Uzbekistan reported.

At present, almost all available personal protective equipment (PPE) in Uzbekistan is used for the detection, triage, verification, isolation and treatment of COVID-19 patients and their contacts. That leaves a large share of healthcare workers dealing with other than suspected or confirmed COVID-19 patients unprotected, like those in maternity hospitals, TB and HIV clinics, dentists and policlinics, etc. Therefore, the procurement of WHO-recommended PPE for healthcare workers not only working with COVID-19 patients but also in other health services and facilities, is essential to reduce the transmission of COVID-19.

“The healthcare personnel are our everyday heroes and we must make sure that they can work safely when protecting us. This project is a key part of the 36 Million Euro Team Europe response to the pandemic in Uzbekistan,” said Jussi Narvi, Chargé d’affaires of the European Union to Uzbekistan.

“The procurement of enough quality personnel protection equipment is essential to be distributed to all healthcare workers in the country to avoid more losses of healthcare personnel due to illness and to reduce the cases of COVID-19 patients among the population,” said Dr. Lianne Kuppens, Head of the WHO Country Office in Uzbekistan.

With the financial support of the European Union and in close collaboration with the Ministry of Health of Uzbekistan, the project will strengthen infection prevention and control measures through procurement of sufficient and high-quality PPEs for all healthcare workers in the country for the next two years.

Millionth death from COVID-19 ‘an agonizing milestone’

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Millionth death from COVID-19 ‘an agonizing milestone’: UN Secretary-General

Millionth death from COVID-19 ‘an agonizing milestone’: UN Secretary-General

“They were fathers and mothers, wives and husbands, brothers and sisters, friends and colleagues,” he said in a statement on Monday night. 

 

The pain has been multiplied by the “savageness” of the disease, the Secretary-General added, noting that the risk of infection kept families from being with their loved ones, and the process of mourning and celebrating a life was often made impossible. 

“How do you say goodbye without holding a hand, or extending a gentle kiss, a warm embrace, a final whisper ‘I love you?’” 

At the same time, there is still no end in sight to the spread of the virus, the loss of jobs, the disruption of education, the upheaval to our lives, said Mr. Guterres. 

‘We can overcome’ 

However, we can overcome this challenge, he urged, underlining the need to “learn from the mistakes”. 

“Responsible leadership matters.  Science matters.  Cooperation matters – and misinformation kills. As the relentless hunt for a vaccine continues – a vaccine that must be available and affordable to all – let’s do our part to save lives,” said Mr. Guterres. 

“As we remember so many lives lost, let us never forget that our future rests on solidarity – as people united and as united nations.” 

‘History will judge us’ – WHO chief

The milestone gives us all “pause for reflection”, said the head of the World Health Organization (WHO), Tedros Adhanom Gehbreyesus in an op-ed published on Tuesday, but represent a moment to come together in solidarity “to fight back against this virus.”

“History will judge us on the decisions we do and don’t make in the months ahead. Let’s seize the opportunity and bridge national boundaries to save lives and livelihoods.”

He repeated the key message that it is never too late to turn things around, if a country becomes mired in a further wave of transmission: “While we await further breakthroughs, we have seen that the virus can be effectively contained through the application of tried and tested public health measures.”

New rapid diagnostic test for COVID-19 

Meanwhile, a new COVID-19 diagnostic test, which can provide reliable results quickly, at a lower price and using less sophisticated technology, will help expand capacity to detect cases in low and middle-income countries, the WHO has announced

Through agreements between WHO and partners, 120 million such tests will be made available to these countries, over a period of six months. 

“This will enable the expansion of testing, particularly in hard-to-reach areas that do not have lab facilities or enough trained health workers to carry out PCR tests,” WHO Director-General Tedros Adhanom Ghebreyesus said at a media briefing on Monday, adding that it would be “a vital addition” to countries’ testing capacity and is especially important in areas of high transmission. 

The tests – antigen rapid diagnostic tests (Ag RDTs) – priced at $5 per unit, are easy to use and highly portable, and provide reliable results in approximately 15 to 30 minutes – substantially faster as well as cheaper than polymerase-chain reaction (PCR) tests, according to WHO. 

“The quicker COVID-19 can be diagnosed, the quicker action can be taken to treat and isolate those with the virus and trace their contacts,” said Mr. Tedros. 

With agreement and seed funding already secured, the need now is the full amount of funds to buy the tests, stressed the WHO Director-General.

EU and corporate tax regime

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EU and corporate tax regime

Sir, – In her article on the French official assault on Ireland’s corporate tax regime, Lara Marlowe quotes from a report by the Paris-based Jacques Delors Institute, which claims that Ireland’s receipt of EU structural funds has enabled this country to offer a low corporate tax rate (“French look intent on pursuing EU tax harmonisation”, Business News, September 25th).

                                                    <p class="LETTER">That assertion is highly questionable. </p>
                                                    <p class="LETTER">For over a quarter of a century, Ireland’s corporate tax revenues relative to GDP have been larger than France’s, and before that were not much more than 0.5 per cent of GDP lower. </p>
                                                    <p class="LETTER">This is incompatible with the idea that the structural funds financed Ireland’s low corporate tax rate. In fact, as is often the case in public finance, Ireland discovered that the lower the rate, the higher the take. </p>
                                                                                                                                                                                        <p class="LETTER">The Irish corporate tax regime has powered Ireland’s ascent out of the ranks of those who need EU funds to the status of a net contributor to the EU budget. That means that going forward Ireland will ultimately pay more than it receives from such initiatives as the EU €750 billion Covid recovery fund, cited by the Jacques Delors Institute as an act of EU solidarity that requires tax harmonisation among member states. </p>
                                                    <p class="LETTER">In debates on the issue of Ireland’s company tax regime, there is often the claim – and there is an inference of it in the institute’s report – that Ireland somehow “owes” the EU for the structural funds. If the funds did create debts, whether legal, political or moral, they were more than paid off in 2011 when the European Central Bank (headed at the time by a French national) insisted that Ireland should repay all of the Irish banks’ creditors (thought to be mainly French and German interests). </p>
                                                    <p class="LETTER">The error of letting creditors off in financial crashes like this has been long recognised by the IMF. At the time it urged that some at least of the €60 billion involved in the Irish case should be shouldered by these creditors. The error was recognised subsequently by the EU, which now makes this kind of “bailing in” a standard feature of any future systemic financial rescues. Too late for the Irish taxpayer.</p>

                                                    <p class="LETTER">Finally, the proposal from a French official, also cited in Lara Marlowe’s article, that the EU should bend the rules to get around article 116 of the Treaty on the Functioning of the European Union, which enshrines tax autonomy, smacks more than a little of the sort of manoeuvres recently seen in our nearest neighbour. At least the British made no bones about their readiness to break an agreement already made. Usage of EU gobbledygook like “passerelle” should not be allowed to obscure the fact that something similar is afoot in Europe. – Yours, etc,</p>
                                                    <p class="LETTER">JIM DORGAN,</p>
                                                    <p class="LETTER">Blackrock, </p>
                                                    <p class="LETTER">Co Dublin. </p>

European Union Digital Asset Legislation Anticipated to Create Confidence, Open the Market to DLT Innovators

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European Union Digital Asset Legislation Anticipated to Create Confidence, Open the Market to DLT Innovators

ywAAAAAAQABAAACAUwAOw== European Union Digital Asset Legislation Anticipated to Create Confidence, Open the Market to DLT Innovators

A Discussion with Franck Guiader of Gide 255

Last week, the European Commission adopted a Digital Finance Package along with legislative proposals on cryptoassets (digital assets). The move had been widely telegraphed by the Commission and, in fact, a draft of the crypto regulation was leaked the week before.

The proposal on cryptoassets seeks to leverage the potential of this Fintech innovation while mitigating potential risk and preserving financial stability. European Commission Executive Vice-President Valdis Dombrovskis noted that there are special rules for stablecoins, like Facebook’s Libra, including more stringent requirements:

” This is because of the potentially vast scale these stablecoins could reach in terms of users – which could pose specific challenges to financial stability. So we need strong safeguards, also against fraud and money laundering,” stated Dombrovskis.

Crowdfund Insider contacted Franck Guiader, for additional perspective on the European Union approach to cryptoassets. Guiader is Head of Innovation & Fintech at Gide 255 – part of the global law firm of Gide. He is an expert in Fintech, specializing in European regulation. Previously, he was the manager of the French Autorité des Marchés Financiers (AMF) Asset Management Regulation division of the Regulatory Policy and International Affairs Directorate. In May 2016, Guiader became head of the AMF’s new Fintech division. He also co-led the AMF-ACPR Fintech forum with the supervisory authority. Clearly, Guiader is closely engaged with Fintech innovation including cryptoassets.  Our discussion with Guiader is shared below.

(Editors Note: the discussion took place just prior to the official release of the legislation)

ywAAAAAAQABAAACAUwAOw== European Union Digital Asset Legislation Anticipated to Create Confidence, Open the Market to DLT Innovators

The regulations were widely anticipated to be posted later this month. As this “draft” was leaked was this an attempt to run the rules up the flagpole in advance? What is the chatter on the proposal?

Franck Guiader: First of all, this leak requires to remain cautious on the final draft that will be officially published soon.

Discussions on this expected regulation started 2 years ago at the EU level, and I would say that the rationale of the text is not a surprise.

The time has come now to scrutinize the details and to assess to what extent this new piece of regulation will meet players’ expectations. There is still a lot to achieve and negotiations should be intense.

The draft legislation covers a diverse range of areas pertaining to digital assets. Is there a risk of these rules becoming overly prescriptive in a rapidly changing environment?

Franck Guiader: This is clearly one of the risks stemming from a new regulation in general, particularly in the realm of digital finance.

Rules are of course of utmost importance to provide legal certainty, but they shall be designed pragmatically, taking into account both the particularities of advanced technologies and the functioning of these new ecosystems. The worst-case scenario would be a too strict regulation dissuading crypto-players to develop their activities within the EU. A balanced approach will hence be key, to avoid regulatory arbitrage at the expense of the EU single market.

How closely do these proposed rules align with France’s ecosystem?

Franck Guiader: The French crypto-ecosystem is dynamic and ambitious. We find players throughout the value chain of crypto-digital finance: platforms of exchanges, custodians, advisors…

We also find an increasing number of incumbent players, such as investment banks, interesting in the development of financial activities based on DLTs.

Today, these players that are our clients at Gide, both new entrants and historical institutions, expect from the EU legislator and national authorities certain clarifications that could allow to accelerate the tokenization of assets and/or the blockchainization of certain activities.

France paved the way for innovations in regulation applying to these players. Several hooks dealing with blockchain and cryptos have already been inserted into the French law (eg. PACTE Bill providing a regime for digital assets service providers).   The rules proposed by the EU Commission seem to be partially inspired by the French law. Others seem to stem from regulation applying to securities markets. The main challenge will consist in the reconciliation between traditional rules and legal concepts, and particularities of decentralized ledger technologies.

ESMA and the EBA have been enlisted to fill in much of the details. Doesn’t this leave quite a bit of room for interpretation by these two entities?

Franck Guiader: Generally speaking, and particularly when it comes to innovation, we need European authorities to avoid regulatory arbitrage within the EU. This is a key point ensuring convergence. The misinterpretation of rules applying to new activities could lead to a failure for the EU Commission with this new regulation. Moreover, the EBA for instance needs to be informed of large-scale initiatives and monitor their impact that might create systemic risk in the market of means of payments. The notion of “significant” stablecoins appears in the draft for these reasons.

Do you see any big shortcomings in the proposal?

Franck Guiader: No “big” shortcomings except maybe a “big” place given to proportionality.

Volumes will not be able to increase if there is a lack of proportionality in the final proposal.

Rules can not apply equally to start-ups whose activities remain under low thresholds, and big players dealing significant volumes and flows. A gradual and progressive approach would make sense to rule this new market, with a test and learn mechanism that would allow fostering innovation in finance.

What about “exchanges” or digital asset marketplaces. Doesn’t the proposal leave much up to the member state to decide?

Franck Guiader: Legally speaking, this text is not a directive implemented into each Member state’s law, but a regulation that directly applies to players. Broadly speaking, it means that Member State will have less maneuvering walking. When they must clarify certain rules at the National level, it is to ensure a good coordination/articulation with certain specificities of national law.

What are your predictions for the proposed legislation if it becomes European law?

Franck Guiader: From a purely legal perspective, I would say that it will create confidence, certainty, and will open a pan-European market for these players that will benefit from the EU passport mechanism. Incumbent players should also be more open to innovate through the use of DLTs, with in-house experimentations and/or in partnerships with start-up companies.

From an economic perspective, I hope that the final text will be sufficiently proportionate, to avoid regulatory arbitrage and make the EU great for the crypto-ecosystem.


COMMUNICATION FROM THE COMMISSION TO THE EUROPEAN PARLIAMENT, THE COUNCIL, THE EUROPEAN ECONOMIC AND SOCIAL COMMITTEE AND THE COMMITTEE OF THE REGIONS


Turkey sees EU summit as chance for reset: Presidential spokesperson

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Turkey sees EU summit as chance for reset: Presidential spokesperson
ISTANBUL-Reuters

Turkey sees EU summit as chance for reset: Presidential spokespersonTurkey sees a European Union summit this week as an opportunity to reset relations between them, but the bloc must produce specific proposals and a timetable to work on a roadmap together, President Recep Tayyip Erdoğan’s spokesman said.

Tensions flared between Turkey and EU member Greece after Ankara sent a seismic vessel to explore for hydrocarbons in disputed waters in the eastern Mediterranean last month and the Oct. 1-2 summit aims to calm the bitter dispute.

“I believe the EU summit has a chance to have a reset in Turkey-EU relations. It is an important opportunity. We can have a reset there. And I see this willingness on the part of many EU member countries,” presidential spokesman İbrahim Kalın told Reuters.

“They also have to understand that they cannot expect Turkey to do everything,” Kalın said in an interview. “It must be a mutual process. If Turkey is expected to do X, Y, Z, EU countries must fulfill their responsibilities as well.”

Senior EU diplomats and officials have said the bloc is unlikely to follow through on a threat to impose sanctions on Turkey after Ankara’s agreement last week to resume exploratory talks with Greece, which were halted in 2016.

Work was continuing on deciding a date for the resumption of talks, Kalın said, adding the talks would continue where they left off and focus not just on issues of continental shelves and maritime limits, but on islands and air space.

He said he believed the talks would have a positive impact and would also focus on political consultation and military-to-military talks. “In all of these three tracks we believe we will make some good progress very soon,” he said.

Turkey got involved in a war of words with France during the east Mediterranean dispute and Erdoğan last week held his first talks with French President Emmanuel Macron in months in a bid to ease the tensions.

Kalın said there was a positive atmosphere in those talks with the two leaders agreeing to try and find ways to minimize their differences.

“I believe all these things will produce a more positive agenda and a more positive atmosphere between Turkey and France,” he said.