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Living the FATCA life in Africa: New U.S. tax regulations add to burden of compliance on financial institutions across Africa

Posted on 21 May 2013 by Eugene Skrynnyk

Eugene Skrynnyk

Eugene Skrynnyk (CIPM, MILE, BComm) is a senior manager and specialist for the asset management industry in the Africa Sub-Area at Ernst & Young in Cape Town, South Africa.

Eugene Skrynnyk is the Ernst & Young Senior Manager and specialist for the asset management industry in the Africa Sub-Area.

Eugene holds a Certificate in Investment Performance Measurement (CIPM), Master of International Law and Economics (MILE) and Bachelor of Commerce and Finance (B.Comm.).

 

When the U.S. Department of the Treasury (“Treasury”) and Internal Revenue Service (“IRS”) issued final Foreign Account Tax Compliance Act (“FATCA”) regulations in January of this year, there was a sigh of relief that the financial services industry in Africa could begin to digest FATCA’s obligations. However, achieving FATCA compliance remains a challenge for banks operating across Africa.

FATCA is already law in the U.S. but negotiations are under way to enshrine it in national law of countries around the world via intergovernmental agreements (“IGAs”) with the U.S. While a variety of African jurisdictions will each face unique obstacles with FATCA compliance, many in the industry share a general unease with FATCA’s scope, as well as scepticism that FATCA’s rewards (an estimated US$1 billion in additional tax revenue annually) justify its expenses. Generally, FATCA attempts to combat U.S. tax evasion by requiring that non-U.S. financial institutions report the identities of U.S. shareholders or customers, or otherwise face a 30% withholding tax on their U.S. source income. Overwhelmingly, FATCA compliance obligations apply even where there is very little risk of U.S. tax evasion and it impacts all payers, including foreign payers of “withholdable payments” made to any foreign entities affecting deposit accounts, custody and investments.

General issues in Africa

Concerns about privacy abound. FATCA requires financial institutions to report to the IRS certain information about U.S. persons. For this reason, IGAs are being put in place so that institutions could instead report information to their local tax authority rather than the IRS. In some jurisdictions, investment funds and insurance companies are permitted to disclose information with client consent. In other jurisdictions, such disclosure is prohibited without further changes to domestic law. The process to make necessary changes locally involves time and effort.

Cultural differences in Africa need to be considered. In certain situations FATCA requires that financial institutions ask a customer who was born in the United States to submit documents explaining why the customer abandoned U.S. citizenship or did not obtain it at birth. African financial institutions never pose such a delicate and private question to their customers. Even apparently straight-forward requirements may pose challenges; for example, FATCA requires that customers make representations about their identities “under penalty of perjury” in certain situations. Few countries have a custom of making legal oaths, so it would not be surprising if African customers will be reluctant to give them.

FATCA contains partial exemptions (i.e., “deemed compliance”) and also exceptions for certain financial institutions and products that are less likely to be used by U.S. tax evaders. It still has to be seen to what extent these exemptions have utility for financial institutions in Africa. For example, the regulations include an exemption for retirement funds and also partially exempt “restricted funds” — funds that prohibit investment by U.S. persons. Although many non-U.S. funds have long restricted investment by U.S. persons because of the U.S. federal securities laws, this exemption could be less useful than it first appears. It should be pointed out that the exemption also requires that funds be sold exclusively to limited categories of FATCA-compliant or exempt institutions and distributors. These categories are themselves difficult for African institutions to qualify for. For example, a restricted fund may sell to certain distributors who agree not to sell to U.S. persons (“restricted distributors”). But restricted distributors must operate solely in the country of their incorporation, a true obstacle in smaller markets where many distributors must operate regionally to attain scale.

Other permitted distribution channels for restricted funds are “local banks,” which are not allowed to have any operations outside of their jurisdiction of incorporation and may not advertise the availability of U.S. dollar denominated investments.

Challenges and lessons learned – the African perspective

Financial institutions will have to consider what steps to take to prepare for FATCA compliance and take into account other FATCA obligations, such as account due diligence and withholding against non-compliant U.S. accountholders and/or financial institutions.

The core of FATCA is the process of reviewing customer records to search for “U.S. indicia” — that is, evidence that a customer might be a U.S. taxpayer. Under certain circumstances, FATCA requires financial institutions to look through their customers and counterparties’ ownership to find “substantial U.S. owners” (generally, certain U.S. persons holding more than 10% of an entity). In many countries the existing anti-money laundering legislation generally requires that financial institutions look through entities only when there is a 20% or 25% owner, leaving a gap between information that may be needed for FATCA compliance and existing procedures. Even how to deal with non-FATCA compliant financial institutions and whether to completely disengage business ties with them, remains open.

The following is an outline of some of the lessons learned in approaching FATCA compliance and the considerations financial institutions should make:

Focus on reducing the problem

Reducing the problem through the analysis and filtering of legal entities, products, customer types, distribution channels and account values, which may be prudently de-scoped, can enable financial institutions to address their distinct challenges and to identify areas of significant impact across their businesses. This quickly scopes the problem areas and focuses the resource and budget effort to where it is most necessary.

Select the most optimal design solution

FATCA legislation is complex and comprehensive as it attempts to counter various potential approaches to evade taxes. Therefore, understanding the complexities of FATCA and distilling its key implications is crucial in formulating a well rounded, easily executable FATCA compliance programme in the limited time left.

Selecting an option for compliance is dependent on the nature of the business and the impact of FATCA on the financial institution. However, due to compliance time constraints and the number of changes required by financial institutions, the solution design may well require tactical solutions with minimal business impact and investment. This will allow financial institutions to achieve compliance by applying low cost ‘work arounds’ and process changes. Strategic and long-term solutions can be better planned and phased-in with less disruption to the financial institution thereafter.

Concentrate on critical activities for 2014

FATCA has phased timelines, which run from 2014 to 2017 and beyond. By focusing on the “must-do” activities, which require compliance as of 1 January 2014 – such as appointing a Responsible Officer, registering with the IRS, and addressing new client on-boarding processes and systems – financial institutions can dedicate the necessary resources more efficiently and effectively to meet immediate deadlines.

Clear ownership – both centrally and within local subsidiaries

FATCA is a strategic issue for the business, requiring significant and widespread change. Typically it starts as a ‘tax issue’ but execution has impacts across IT, AML/KYC, operations, sales, distribution and client relationship management. It is imperative to get the right stakeholders and support onboard to ensure that the operational changes are being coordinated, managed and implemented by the necessary multidisciplinary teams across the organization. These include business operations, IT, marketing, and legal and compliance, to name but a few. Early involvement and clear ownership is key from the start.

Understand your footprint in Africa

Many African financial institutions have operations in various African countries and even overseas, and have strategically chosen to make further investments throughout Africa. The degree to which these African countries have exposure to the FATCA regulations needs to be understood. It is best to quickly engage with appropriate stakeholders, understand how FATCA impacts these African countries and the financial institutions’ foreign subsidiaries, and find solutions that enable pragmatic compliance.

What next for financial institutions in Africa?

Negotiations with the U.S. are under way with over 60 countries to enshrine FATCA in national law of countries around the world via IGAs. Implementation of FATCA is approaching on 1 January 2014 and many local financial institutions have either not started or are just at the early stages of addressing the potential impact of FATCA. In South Africa, only few of the leading banks are completing impact assessments and already optimizing solutions. Other financial services groups and asset management institutions are in the process of tackling the impact assessment. Industry representative in Ghana, Kenya, Mauritius, Namibia, Nigeria and Zimbabwe have started engaging relevant government and industry stakeholders, but the awareness is seemingly oblivious to date. In the rest of Africa, FATCA is mainly unheard of.

Financial institutions choosing to comply with FATCA will first need to appoint a responsible officer for FATCA and register with the IRS, ensure proper new client on-boarding procedures are in place, then identify and categorize all customers, and eventually report U.S. persons to the IRS (or local tax authorities in IGA jurisdictions). Institutions will also need to consider implementing a host of other time-consuming operational tasks, including revamping certain electronic systems to capture applicable accountholder information and/or to accommodate the new reporting and withholding requirements, enhancing customer on-boarding processes, and educating both customers and staff on the new regulations. Where possible, institutions should seek to achieve these tasks through enhancing existing initiations so as to minimise the cost and disruption to the business.

Conclusion

Financial institutions in Africa face tight FATCA compliance timelines with limited budgets, resources, time, and expertise available. This is coupled with having to fulfil multiple other regulatory requirements. To add to the burden, FATCA has given stimulus to several countries in the European Union to start discussing a multilateral effort against tax evasion. The support of other countries in the IGA process indicates that some of these countries will follow with their own FATCA-equivalent legislation in an attempt to increase local tax revenues at a time when economies around the world are under unprecedented pressure. The best approach for African financial services industry groups is to engage their local governments in dialogue with the IRS and Treasury, while for African financial institutions to pro-actively assess their FATCA strategic and operational burdens as they inevitably prepare for compliance.

 

About Ernst & Young

Ernst & Young is a global leader in assurance, tax, transaction and advisory services. Worldwide, our 167,000 people are united by our shared values and an unwavering commitment to quality. We make a difference by helping our people, our clients and our wider communities achieve their potential.

The Ernst & Young Africa Sub-Area consists of practices in 28 countries across the African continent. We pride ourselves in our integrated operating model which enables us to serve our clients on a seamless basis across the continent, as well as across the world.

Ernst & Young South Africa has a Level two, AAA B-BBEE rating. As a recognised value adding enterprise, our clients are able to claim B-BBEE recognition of 156.25%.

Ernst & Young refers to the global organisation of member firms of Ernst & Young Global Limited, each of which is a separate legal entity. All Ernst & Young practices in the Africa Sub Area are members of Ernst & Young Africa Limited (NPC). Ernst & Young Africa Limited (NPC) in turn is a member firm of Ernst & Young Global Limited, a UK company limited by guarantee. Neither Ernst & Young Global Limited nor Ernst & Young Limited (NPC) provides services to clients.

For more information about our organisation, please visit www.ey.com/za

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Daily Analysis for Monday May 20

Posted on 21 May 2013 by Africa Business

This week begins with great anticipation for profitable trading opportunities. Banks in Europe and Canada will be closed on Monday, but traders could take advantage of the release of the Australian Monetary Policy Meeting Minutes. Later in the week, we are expecting inflation and retail sales data out the United Kingdom. These announcements will surely pave a clear direction for the British Pound. Meanwhile, home sales in the world’s largest economy will be put forth on Thursday. Whether the U.S. dollar is affected, that remains to be seen.

USD/CAD


Friday’s inflation report was softer than consensus expectations. Headline CPI is increasing at its slowest since October 2009 when the economy was still experiencing the consequences of the recession. In this environment, inflation is clearly not the main radar the Bank of Canada is looking at for now, but growth is. Given our expectations of subpar growth for 2013, rate hikes in Canada are unlikely anytime soon. Look for the Loonie to continue weakening in the coming days.

Stop loss 1.0250

Take profit 1.0315

Gold


The yellow metal started the new week on the wrong foot, tumbling during Monday’s morning session as traders increased their bearish bets on this commodity. It has been falling since October 2012, with the sharpest market movement taking place just last month. We have recently reached the lowest point last seen on April 14th. Traders are advised to hold onto their short positions until further notice. We expect to reach $1,300 within days, possibly by Thursday of this week.

Stop loss $1,370

Take profit $1,300

USD/ILS


The Bank of Israel surprised with a 25 basis point rate cut to 1.5% last week, an intra-meeting move. The next scheduled meeting is set for May 27th. We’ve been looking for more cuts, especially as the Shekel has strengthened in recent weeks. As it cut rates, the central bank noted that the shekel has been boosted by natural gas sales and global monetary easing. Furthermore, the Bank of Israel announced a plan to increase its holdings of foreign exchange in an effort to offset the money from gas sales. For now, the high probability of sequential rate cuts suggests this pair is likely to continue heading north. We’re currently aiming at 3.6370.

Stop Loss 3.6316

Take profit 3.6370

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DC Finance’s CEO will be visiting NYC from June 17thto promote the East Coast Family Office & Wealth Management Conference and the firm’s institutional investment, corporate finance, going public and family office events in Israel. Available for meetings

Posted on 21 May 2013 by Africa Business

 

DC Finance, the manager of one of the world’s largest Family Office events, ( www.israelwealth.com), is proud to present the East Coast’s top HNWI & SFOs wealth management event – The Annual East Coast Family Office & Wealth Management Conference, OCT 2nd, at the Union League Club, New York City ( www.nyc-wealth.com).

We are currently seeking firms who wish to support and join this 1st tier event. Mr Denny Chared, DC Finance’s CEO, will be more than happy to meet firms who may be intrested in meeting our target audiance of SFOs and HNWI.

The event will bring together 200 UHNWI, HNWI and SFOs with an average net worth of $400 million, with 50 of the best speakers in the fields of oil and gas investments, real estate, homeland security, high tech investments, philanthropy, private family banks, families in business, direct investing, family office, estate planning, trusts and other various investment alternatives.

Our current confirmed speakers lisr include: Dr. Yossi Vardi, Mr. Martin S. Indyk, vice president and director of the Foreign Policy Program at the Brookings Institution in Washington D.C., and former U.S. ambassador to Israel Mr. Howard Cooper , CEO, Cooper Family Office | Mr. David Sable , Global CEO, Y&R | Mr, Tewodros Ashenafi ,  CEO, SouthWest Energy Ltd, Ms. Kay Koplovitz , Founder, USA Networks and Chairman and CEO of Koplovitz & Co. LLC. Kay Koplovitz | Mr. Dror Berman , Founding Managing Partner, Innovation Endeavors (The Eric Schmidt Investment Fund), Ms. Wendy Craft , Executive Vice President and General Counsel, Fulcrum Equities | Mr. Lowell Sands , Rosewood Resources | Mr. Angelo J. Robles, CEO, Family Office Association Mr. Munib R. Masri, Chairman, Engineering and Development Group | Mr. David Gorman , Americas Advisor, The Table Club | Ms. Candice Beaumont , Managing Director, L. Investments | Mr. Harold F. “Rick” Pitcairn , II, CFA, CIO, Pitcairn and Chairman, Wigmore Association | Mr. Steve Oyer , Partner, Grail Partners | Mr. Ira Perlmuter , Head of Family Office Direct Investing, T5 Equity Partners| Mr. Nirmal Saverimuttu , Principal, Virgin Group | Mr. Andy Unanue , Managing Partner, AUA Private Equity Partners | Ms. Karen Wawrzaszek , Managing Director, Pitcairn | Mr. Warner King Babcock , Chairman and CEO, AM Private Enterprises, Inc. | Ms. Raya Strauss Bendror , President and Co-Owner, Strauss Investment, The Strauss Family | Ms. Nava Michael Tsabari , Academic Director, Family Business Program, Lahav-Executive Education, Recanati Business School, Faculty of Management Tel Aviv University, The Strauss Family | Mr. Guy Schory , Head of New Ventures, eBay | Mr. Shimon Eckhouse , Co-founder and Chairman of the Board, Syneron Medical |  Mr. Jamie McLaughlin , Owner, J. H. McLaughlin & Co., LLC |   Mr. Louis Hanna , Corigin Family Office | Ms. Kay Koplovitz , Founder, USA Network | Mr. Kent M. Swig , President, Swig Equities, LLC | Ms. Steffi Claiden , Founder/Editor-in-Chief, Family Office Review | Mr. Daniel Shakhani , CEO, RDS Capital

 

 

Other events:The trip also supports The 2014 institutional investment conference , March 2014, ( www.tlvii.com ), The Israeli Family Office & Wealth Management Conference, June 2013, ( www.israelwealth.com ), the “Family Wealth” magazine and advisors sourcebook, The Annual Kibbutz Industries Financial Conference, Sep 10th 2013, The Annual Going Public and Raising Capital Abroad Conference Oct 9th 2013 and Israel’s Annual Corporate Finance Conference, Nov 22nd 2013 ( www.israel-finance.com( .

Firms with an interest in meeting our target audience are welcome to reply to this email and we will do our best to schedule a meeting. Please be advised that due to a busy schedule not all requests may be fulfilled.

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Morningstar Announces Findings from Third Global Fund Investor Experience Report; United States Scores the Best and South Africa the Worst

Posted on 15 May 2013 by Africa Business

About Morningstar, Inc.
Morningstar, Inc. is a leading provider of independent investment research in North America, Europe, Australia, and Asia. The company offers an extensive line of products and services for individuals, financial advisors, and institutions.

 

CHICAGO, May 15, 2013 /PRNewswire/ — Morningstar, Inc. (NASDAQ: MORN), a leading provider of independent investment research, today released its Global Fund Investor Experience report, which assesses the experiences of mutual fund investors in 24 countries across North America, Europe, Asia, and Africa. Morningstar’s evaluation of investor-friendly practices in fund markets worldwide identified the United States as the best market for fund investors based on criteria such as investor protection, transparency, fees, taxation, and investment distribution, while South Africa scored the worst. This year’s report also includes first-time reviews of fund investor experiences in Korea and Denmark.

“We launched the first Global Fund Investor Experience report in 2009 to examine the treatment of mutual fund shareholders in 16 countries with the goal of advancing a dialogue about best practices worldwide. Since that time we’ve had numerous conversations with regulators and investment companies in multiple countries about their existing policies and ways to improve,” John Rekenthaler , vice president of research for Morningstar, said. “Working with our analysts around the world, we expanded our survey to 24 countries this year. We hope our survey findings will help investment companies, distributors, and regulatory bodies around the globe continue to focus on improving the environment for investors.”

Morningstar researchers evaluated countries in four categories: Regulation and Taxation, Disclosure, Fees and Expenses, and Sales and Media. Morningstar weighted the questions and answers to give greater importance to factual, empirical answers as well as the high-priority issues of fees, taxes, and transparency. Morningstar assigned countries a letter grade for each category and then added the category scores to produce an overall country grade. The report’s authors gathered information from available public data and from Morningstar analysts. Below are the overall country grades, from highest to lowest scores and then in alphabetical order:

United States:  A

Sweden: B-

Korea:  B+

Switzerland: B-

Netherlands:  B

United Kingdom: B-

Singapore:  B

Australia: C+

Taiwan:  B

Belgium: C+

Thailand:  B

Canada: C+

China:  B-

France: C+

Denmark:  B-

Italy: C+

Germany:  B-

Japan: C

India:  B-

Hong Kong: C-

Norway:  B-

New Zealand: C-

Spain:  B-

South Africa: D

The United States garnered the highest score for the third time with a top grade of A. While the United States is not a leader in the area of Regulation and Taxes, it has the world’s best disclosure and lowest expenses. South Africa, in contrast, received the lowest grade largely because of poor disclosure practices. The new countries reviewed in this year’s report—Korea and Denmark—earned grades of B+ and B-, respectively.

New Zealand showed the largest improvement from the 2011 study rising to a C- from a D- because of positive regulatory changes and an encouraging expansion of disclosure requirements. Morningstar anticipates that the New Zealand government’s ongoing review of all fund regulations will result in even more improvements and investor-friendly practices in the years to come.

Among the key findings of the study:

  • Bans on advisor commissions are spreading around the world. In the UK, the Retail Distribution Review (RDR) has already brought such a ban into effect, while similar moves are underway in Australia and the Netherlands.
  • While the U.S. and European fund markets are roughly similar in size, U.S. investors pay significantly lower fees than European investors.
  • Fund companies in most countries continue to treat the names of portfolio managers as trade secrets, leaving investors no way to determine who is responsible for a fund’s success or failure.
  • Australia and New Zealand do not require funds to publicly disclose full portfolio holdings, while France, South Africa, Korea, and the UK only disclose holdings to current owners.

To read Morningstar’s complete Global Fund Investor Experience report, click here.

SOURCE Morningstar, Inc.

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Global Trade Partners in the 21st Century

Posted on 15 May 2013 by Africa Business

WASHINGTON, May 15, 2013/African Press Organization (APO)/ — Remarks

Robert D. Hormats

Under Secretary for Economic Growth, Energy, and the Environment

World Economic Forum

Pretoria, South Africa

May 14, 2013

 

 

As Prepared

 

Thank you Lyal for the kind introduction.

I am delighted to be in South Africa again. I visited last fall with Secretary of State Hillary Clinton.

What was most striking then, and continues to be the case today, is the extent to which the image of Africa has changed. According to the IMF, growth in sub-Saharan Africa will surge to 6.1% next year, well ahead of the global average of 4%.

Africa is booming in nearly every sector, ranging from massive energy developments in Mozambique, Tanzania, Ghana, and other countries; to the growth of Rwanda and Kenya’s information and communications technology sectors; to South Africa’s thriving auto industry. And, though far from declaring victory, Africa is reaching a turning point in its hard-fought battles against poverty and corruption.

Today’s Africa looks nothing like what, in 2000, The Economist referred to as the “Hopeless Continent.” It is critical that we concentrate the world’s eyes on the new image of Africa, that of progress and promise. Perspectives are evolving—in 2011, The Economist referred to Africa as the “Rising Continent” and, last March, as the “Hopeful Continent.”

Trade is at the heart of Africa’s economic resurgence. So, in this context, I will speak first about America’s vision for global trade in the 21st century and then, focus on implications and, indeed, opportunities for Africa. America’s global trade agenda in the 21st century is shaped by a foundation laid, in large part, in the mid-20th century. After World War II, American and European policymakers worked together to build a set of international institutions that embodied democratic and free market principles.

The GATT—which led to the WTO—World Bank, IMF, and the OECD were designed to foster international economic cooperation. These institutions were vital to the economic prosperity of the United States, and to the success of America’s foreign policy and national security for the next three generations.

As we move into the 21st century, a new multi-polar global economy has surfaced. The emergence of a new group of economic powerhouses—Brazil, Russia, India, and China, of course, but also countries in Africa—has created momentum (if not necessity) for greater inclusiveness in the global trading system.

At the same time, these new players must assume responsibilities for the international economic system commensurate with the increasing benefits they derive from the global economy. In addition to the geography of international trade, the nature of trade and investment has evolved to include previously unimaginable issues such as e-commerce and sustainability.

So, part of our vision for trade in the 21st century is to build a system that is more inclusive, recognizes the new realities of economic interdependence, and matches increased participation in the global trading system with increased responsibility for the global trading system.

We are making progress with bringing new players into the global trading system as equal partners. Free Trade Agreements with Korea, Colombia, and Panama entered into force last year.

And, we are continuing negotiations on the Trans-Pacific Partnership—or TPP as it is more widely known. With Japan’s anticipated entry into the negotiations, TPP will grow to include 12 countries of different size, background, and levels of development. The agreement, when finalized, will encompass nearly 40% of global GDP and one-third of global trade.

In addition to TPP, we are embarking on a Transatlantic Trade and Investment Partnership with the European Union. TTIP—as it is being called—will strengthen economic ties between the United States and Europe, and enhance our ability to build stronger relationships with emerging economies in Asia, Africa, and other parts of the world.

TPP and TTIP are truly historic undertakings. Our objective is not only to strengthen economic ties with the Asia-Pacific and Europe, but also to pioneer approaches to trade and investment issues that have grown in importance in recent years.

These agreements will seek to break new ground by addressing a multitude of heretofore unaddressed non-tariff barriers, setting the stage for convergence on key standards and regulations, and establishing high quality norms and practices that can spread to other markets. TPP, for example, will raise standards on investment and electronic commerce, and afford protections for labor and the environment.

Our agenda also includes strengthening the multilateral trading system through the World Trade Organization. For example, the United States would like to see a multilateral Trade Facilitation Agreement, which would commit WTO Members to expedite the movement, release, and clearance of goods, and improve cooperation on customs matters. A Trade Facilitation Agreement would be a win-win for all parties—Africa especially.

Cross-border trade in Africa is hindered by what the World Bank calls “Thick Borders.” According to the latest Doing Business Report, it takes up to 35 days to clear exports and 44 days to clear imports in Africa. Clearing goods in OECD countries, in contrast, takes only 10 days on average and costs nearly half as much. Countries like Ghana and Rwanda have benefited tremendously from the introduction of trade facilitation tools and policies.

Ghana, for instance, introduced reforms in 2003 that decreased the cost and time of trading across borders by 60%, and increased customs revenue by 50%. A multilateral Trade Facilitation Agreement will create a glide path for increased trade with and within Africa.

Our views for 21st century global trade partnerships go beyond Europe and the Asia-Pacific, and efforts at the WTO. We are committed to supporting Africa’s integration into the global trading system. The cornerstone of our trade relationship with sub-Saharan Africa is the African Growth and Opportunity Act—known as AGOA. Of all of our trade preference programs, AGOA provides the most liberal trade access to the U.S. market.

Exports from Africa to the United States under the AGOA have grown to $34.9 billion in 2012. While oil and gas still represent a large portion of Africa’s exports, it is important to recognize that non-petroleum exports under AGOA have tripled to nearly $5 billion since 2001, when AGOA went into effect. And, compared to a decade ago, more than twice the number of eligible countries are exporting non-petroleum goods under AGOA.

South Africa, in particular, has made great strides in diversifying its exports to the United States. Thanks to AGOA, the United States is now South Africa’s main export market for passenger cars, representing more than 50% of exported value in 2012. Because AGOA is such an important mechanism for African countries to gain access to the U.S. market, the Administration is committed to working with Congress on an early, seamless renewal of AGOA. Our trade relationship with Africa goes beyond AGOA. For instance, AGOA represents only one-quarter of South African exports to the United States. The composition of South Africa’s exports to the United States, moreover, reflects complex interdependencies and industrial goods.

And, our trade relationship with Africa is not just about one-way trade. There is an immense opportunity for U.S. companies to do business on the continent.

We recently launched the “Doing Business in Africa Campaign” to help American businesses identify and seize upon trade and investment opportunities in Africa. The campaign was announced in Johannesburg, in part, because South Africa can play a prominent role in directing U.S. investment into other parts of the continent.

Although progress has been made on diversifying exports beyond energy, there is much more to be done. African ingenuity and entrepreneurship must be unleashed to drive innovation and growth throughout the continent. This requires closer integration to share ideas, transfer knowledge, and partner on solutions. Through AGOA and the “Doing Business in Africa Campaign”, we are promoting a business climate in Africa that enables and encourages trade and investment. However, realizing these goals is goes beyond trade preferences and commercial linkages.

Africa is also featured in America’s vision for global trade in the 21st century.

For example, we recently launched the U.S.-East African Community Trade and Investment Partnership—the first of its kind—to expand two-way trade and investment. The Partnership is designed to build confidence among the private sector by building a more open and predictable business climate in East Africa. We are considering a variety of mechanisms to accomplish this, including a regional investment treaty and trade facilitation agreement. The Partnership highlights our desire to help Africa integrate and compete in today’s global economy.

I will conclude with one final point. I began by saying that trade is at the heart of Africa’s economic resurgence. Trade is also at the heart of America’s economic recovery. We have a common interest and a common goal.

When it comes to enhanced trade, what is good for Africa is good for America. And what is good for America is good for Africa.

Thank you.


SOURCE

US Department of State

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IMF Executive Board Concludes 2013 Article IV Consultation with Seychelles

Posted on 15 May 2013 by Africa Business

VICTORIA, Mahé, May 15, 2013/African Press Organization (APO)/ On May 8, 2013, the Executive Board of the International Monetary Fund (IMF) concluded the Article IV consultation with Seychelles. 1

Background

In the few years since the 2008 debt crisis, Seychelles has made remarkable strides, quickly restoring macroeconomic stability and creating room for private-sector activity. Macroeconomic developments in the tourism-based island economy have been favorable, despite the challenging global environment. Notably, growth held up as the tourism industry successfully attracted arrivals from non-traditional markets as European arrivals slumped, while a surge in foreign direct investment (FDI) supported construction in recent years. For the most part, inflation remained contained, and the external position improved markedly following liberalization of the exchange rate in 2008 and debt restructuring started in 2009.

In 2012, despite robust tourist arrivals, growth moderated to 2.9 percent as large investment projects were completed. Inflation spiked in July 2012 to 8.9 percent fueled by global as well as domestic developments, but has since abated as a result of successful monetary tightening. The external position continued to improve, albeit modestly. In particular, the current account deficit declined slightly, but remained high at around 22 percent of gross domestic product (GDP), but was fully financed by FDI and external borrowing, leading to a modest rise in reserves. Debt restructuring is nearly complete, with only one loan agreement awaiting signature.

Fiscal policy in 2012 continued to support debt sustainability. The primary surplus is projected to have risen to 6.2 percent of GDP, in part due to sizable windfall revenues which were partly saved. Buoyant revenue and grants paved the way for needed capital expenditure. Notwithstanding, public debt increased by over 3 percentage points of GDP due mostly to currency depreciation and the government assuming liabilities of Air Seychelles.

Monetary policy was tightened sharply in 2012 in response to rising inflation and an unhinging of the exchange rate, and has since been relaxed. Starting in late-2011, rising global food and fuel prices coupled with adjustments in administered prices pushed prices higher. This was reinforced by current account pressures resulting from lower exports of transportation services in the wake of the restructuring of Air Seychelles. The looming inflation-depreciation spiral was broken in mid-2012 by two small foreign exchange market interventions by the Central Bank of Seychelles and a tightening of monetary policy. By end-2012, inflation had fallen to 5.8 percent and the exchange rate had strengthened beyond its end-2011 level.

Broad-based structural reform over the past five years has worked to improve financial performance of the public sector and increase private sector participation in economic activity. Statistical capacity continues to be strengthened. Seychelles subscribes to the IMF’s General Data Dissemination Standard (GDDS) and is making progress at compiling higher frequency economic data which will support strengthened macroeconomic oversight and analysis.

Executive Board Assessment

Executive Directors commended the authorities for their strong policy implementation. Macroeconomic stability has been restored and growth has remained resilient. While the outlook is favorable, the economy is vulnerable to an uncertain global environment and domestic risks. Directors called for continued commitment to sound policies and structural reforms to preserve macroeconomic and financial stability, build policy buffers, and foster strong and inclusive growth.

Directors welcomed the steps to improve financial discipline at the central government level and the recent introduction of the VAT. They agreed that strengthening the oversight and financial position of parastatals, including through adequate price mechanisms, and further progress in public financial management will be key to ensuring fiscal sustainability. For the medium term, Directors supported the authorities’ fiscal policy stance which aims at targeting a primary fiscal surplus and reducing public debt to 50 percent of GDP. They welcomed that the debt restructuring is nearly complete and encouraged the authorities to exercise caution when contracting new external debt.

Directors called for continued efforts to improve the monetary framework in order to stabilize inflation expectations and policy interest rates. Absorbing excess liquidity over time will be important to strengthen the monetary anchor and monetary transmission mechanism. Directors considered that a further increase in international reserves, as market conditions permit, would provide a stronger buffer against shocks. Directors noted that the financial system is sound and welcomed the steps being taken to improve the functioning of the credit market.

Directors commended the efforts towards improving the business and investment climate, which is key to avoid a potential middle-income trap and to support broad-based growth. They encouraged the authorities to foster private sector-led growth by addressing infrastructure gaps, engendering lower cost and improved access to credit, correcting data weaknesses, and moving ahead with plans for greater workforce education and capacity building.

 

Seychelles: Selected Economic and Financial Indicators, 2010–14

 

2010    2011    2012    2013    2014

Actual    Actual    Est.    Proj.    Proj.

 

(Percentage change, unless otherwise indicated)

National income and prices

 

Nominal GDP (millions of Seychelles rupees)

11,746    13,119    14,145    15,292    16,461

Real GDP

5.6    5.0    2.9    3.3    3.9

CPI (annual average)

-2.4    2.6    7.1    4.5    3.4

CPI (end-of-period)

0.4    5.5    5.8    4.3    3.1

GDP deflator average

-3.6    6.4    4.8    4.6    3.6

(Percentage change, unless otherwise indicated)

Money and credit

 

Credit to the economy

21.4    6.2    2.5    13.0    …

Broad money

13.5    4.5    -2.3    0.1    …

Reserve money

34.7    -2.7    6.9    12.3    …

Velocity (GDP/broad money)

1.6    1.7    1.9    2.1    …

Money multiplier (broad money/reserve money)

4.2    4.5    4.1    3.6    …

(Percent of GDP)

Savings-Investment balance

 

External savings

23.0    22.7    21.7    23.2    18.4

Gross national savings

13.6    12.4    17.3    15.1    15.5

Of which: government savings

7.8    10.6    14.3    12.1    11.0

Gross investment

36.6    35.1    39.0    38.2    33.8

Of which: government investment

8.6    8.1    12.0    9.2    7.8


Government budget


Total revenue, excluding grants

34.1    35.8    37.6    36.4    35.6

Expenditure and net lending

32.5    35.7    40.2    38.5    36.0

Current expenditure

27.2    27.6    28.8    28.8    27.3

Capital expenditure and net lending

5.3    8.1    11.4    9.8    8.7

Overall balance, including grants

2.5    2.5    2.4    1.8    2.0

Primary balance

8.6    5.4    6.2    5.1    4.4

Total public debt

81.6    74.3    77.3    72.0    65.3

Domestic1

32.5    28.0    27.7    25.7    18.6

External

49.1    46.2    49.6    46.3    46.7

(Percent of GDP, unless otherwise indicated)

External sector

 

Current account balance including official transfers

-23.0    -22.7    -21.7    -23.2    -18.4

Total stock of arrears (millions of U.S. dollars)

30.3    9.0    2.7    …    …

Total public external debt outstanding (millions of U.S. dollars)

478    490    512    558    597

(percent of GDP)

49.1    46.2    49.6    46.3    46.7

Terms of trade (= – deterioration)

-6.7    -6.4    -0.4    0.6    1.2

Real effective exchange rate (average, percent change)

4.4    -7.4    …    …    …

Gross official reserves (end of year, millions of U.S. dollars)

254    277    305    317    326

Months of imports, c.i.f.

2.3    2.5    2.6    2.7    2.7

Exchange rate


Seychelles rupees per US$1 (end-of-period)

12.1    13.7    13.0    …    …

Seychelles rupees per US$1 (period average)

12.1    12.4    13.7    …    …

 

Sources: Central Bank of Seychelles; Ministry of Finance; and IMF staff estimates and projections.

1 Excludes debt issued in 2012 for monetary purposes (5.4 percent of GDP), as proceeds are kept in a blocked account with the Central Bank.

1 Under Article IV of the IMF’s Articles of Agreement, the IMF holds bilateral discussions with members, usually every year. A staff team visits the country, collects economic and financial information, and discusses with officials the country’s economic developments and policies. On return to headquarters, the staff prepares a report, which forms the basis for discussion by the Executive Board. At the conclusion of the discussion, the Managing Director, as Chairman of the Board, summarizes the views of Executive Directors, and this summary is transmitted to the country’s authorities. An explanation of any qualifiers used in summings up can be found here: http://www.imf.org/external/np/sec/misc/qualifiers.htm

 

SOURCE

International Monetary Fund (IMF)

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The Ritz-Carlton Hotel Company, L.L.C. Unveils Plans For New Urban Resort In Rabat, Morocco

Posted on 06 May 2013 by Africa Business

The First Property for The Leader in Luxury Hospitality in The Kingdom’s Capital

About the Ritz-Carlton

The Ritz-Carlton Hotel Company, L.L.C. of Chevy Chase, Md., currently operates 82 hotels in the Americas, Europe, Asia, the Middle East, Africa, and the Caribbean. More than 30 hotel and residential projects are under development around the globe. The Ritz-Carlton is the only service company to have twice earned the prestigious Malcolm Baldrige National Quality Award which recognizes outstanding customer service. For more information, or reservations, contact a travel professional, call toll free in the U.S. 1-800-241-3333, or visit the company website at www.ritzcarlton.com. The Ritz-Carlton Hotel Company, L.L.C. is a wholly owned subsidiary of Marriott International, Inc. (NYSE: MAR)

DUBAI, United Arab Emirates, May 6, 2013 /PRNewswire/ — The Ritz-Carlton Hotel Company, L.L.C., the leader in luxury hospitality, has unveiled plans to open its first property in Rabat, the prestigious capital city of the Kingdom of Morocco, bringing the number of hotels currently under development in the brand’s growing North Africa portfolio to three.

The owner of the urban resort is Sienna Investment Group, an investment vehicle established in Morocco.  The architectural and design team of the luxury property consists of Scape Design Associates as the Landscape Designers, and Architects, WATG. Construction is underway, and The Ritz-Carlton expects the resort to open in December 2014.

The urban resort will be situated approximately 10 minutes’ drive from the city center, within the grounds of the most highly esteemed golf course in the Kingdom, The Royal Golf of Dar Es Salam, designed by Robert Trent Jones over 40 years ago.  The golf estate which comprises three courses, frequented by Rabat and Morocco‘s high society, is set within a stunning 440 hectare oak forest, surrounded by an array of flora and breathtaking lakes, and will provide the scenic backdrop to The Ritz-Carlton, Rabat, located near the 10th tee of the main course.

Herve Humler , President and Chief Operating Officer, The Ritz-Carlton Hotel Company said; “We are delighted to have been chosen by Sienna Investment Group to manage such a unique property, in such a prestigious city in Morocco and North Africa.  The heritage of Rabat, combined with the unique location within a world-class golf estate, will provide an incredibly appealing proposition for the affluent global traveler.”

The city of Rabat is the seat of the Moroccan government and home to the majority of its government agencies, providing the capital with a prominent status.

Sienna Investment Group, the owner, noted the importance of selecting  the right management company; “We selected The Ritz-Carlton to manage this property as it was essential to select a brand with the same caliber of prestige as the city of Rabat itself, and one that is in keeping with the grandeur of The Royal Golf of Dar Es Salam.”

The resort will benefit from 120 guest rooms, 15 one-bedroom and five, two-bedroom villas, expected to appeal to dignitaries and government delegations from around the world.

Further properties currently under construction in North Africa include The Ritz-Carlton, Tunis, Carthage, a resort featuring 129-suites, situated close to the world heritage site of Carthage and Morocco a Ritz-Carlton Reserve in Tamuda Bay, an exclusive upscale resort nestled along the unspoiled waters of the Mediterranean, approximately 60 kilometers east of the city of Tangiers, featuring a 98-luxury room hotel with 35 pool villa suites, a beach club and an 18-hole Nicklaus design golf course.

 

SOURCE The Ritz-Carlton Hotel Company, L.L.C.

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U.S. Ranks First In ‘KPMG Green Tax Index,’ Tops Countries Using Tax Code To Shape Sustainable Corporate Activity

Posted on 29 April 2013 by Africa Business

About the KPMG Green Tax Index

The KPMG Green Tax Index focuses on 21 major economies around the world that KPMG International believes represent a major share of global corporate investment activity. A high ranking in the Index does not necessarily mean that a country is “greener” than others. It means that the government is more active than others in using the tax system as a tool to influence corporate behavior and achieve green policy goals.

A lower ranking does not mean that a government has no green tax or incentive instruments in place. Every nation listed on the KPMG Green Tax Index uses green taxes and incentives to an extent worthy of investigation by corporate tax and sustainability professionals. Countries in which the government does not use green taxes or incentives at all, or does so only minimally, have not been included in the sample of countries selected for review in the Index.

Scoring has required some discretion and judgment to be used and so scores should be taken as indicative, not absolute, in providing a view of those governments with the most active and developed green tax and incentive systems in place. Full details of the scoring methodology can be found at www.kpmg.com/greentax.

About KPMG LLP
KPMG LLP, the audit, tax and advisory firm (www.kpmg.com/us), is the U.S. member firm of KPMG International Cooperative (“KPMG International”). KPMG International’s member firms have 152,000 professionals, including more than 8,600 partners, in 156 countries.

 

NEW YORK /PRNewswire/ — The United States ranked first among 21 countries most actively using the tax code to influence sustainable corporate activity, according to the inaugural edition of the KPMG Green Tax Index, reflecting the country’s extensive and long-established program of federal tax incentives for energy generally, including specific incentives for energy efficiency, renewable energy and green buildings.

Japan, the United Kingdom, France, South Korea and China were also among the leading countries using tax as a tool to drive sustainable corporate behavior, according to the index. Key policy areas explored in the index include energy efficiency, water efficiency, carbon emissions, green innovations and green buildings.

“The KPMG Green Tax Index provides important directional insight for corporate sustainability decision makers, CFOs and board members into how countries are using taxes to influence corporate behavior,” said John Gimigliano , principal-in-charge of sustainability tax in the Washington National Tax practice of KPMG LLP. “Japan, for example, tops the rankings in its promotion of tax incentives for green vehicle production, while the United States favors a comprehensive system of renewable energy tax incentives. As a result, we’re seeing more green cars coming out of Japan and dramatic growth in the U.S. renewable sector.”

“These activity-based rankings can be of value to corporate sustainability decision-makers as they allocate budgets and evaluate investments around the world,” said John Hickox , advisory partner and U.S. practice leader for Climate Change & Sustainability Services at KPMG LLP.

The KPMG index identified over 200 individual tax incentives and penalties of relevance to corporate sustainability. At least 30 of these have been introduced since January 2011, reflecting the quickening pace of green investment globally.

The KPMG Green Tax Index – Overall Country Rankings

U.S.

1

Netherlands

8

Finland

15=

Japan

2

Belgium

9

Germany

U.K.

3

India

10

Australia

17

France

4

Spain

11=

Brazil

18

South Korea

5

Canada

Argentina

19

China

6

South Africa

13

Mexico

20

Ireland

7

Singapore

14

Russia

21

*Scoring: The KPMG Green Tax Index attributes scores to green tax incentives and penalties according to arguable value and potential to influence corporate behavior. Scores should be taken as indicative, not absolute, in providing a view of governments with the most active and developed green tax systems in place.

U.S. Ranking
The United States tops the KPMG Green Tax Index ranking primarily due to its extensive program of federal tax incentives for energy efficiency, renewable energy and green buildings.

According to the KPMG Green Tax Index, the U.S. tax code provides a range of tax credits, including a production tax credit on renewable energy and tax incentives construction of efficient buildings.

The United States uses green penalties less than other Western developed nations apart from Canada. When green tax penalties alone are considered, the United States drops to 14th.

“The KPMG Green Tax Index demonstrates how important it is for corporations to make sure their head of sustainability and their head of tax are talking,” said KPMG’s Gimigliano. “At many companies these functions may have never met. One critical lesson from the Green Tax Index is that for companies to enhance the return from its green spend, the tax and sustainability functions should collaborate before the investment decision is made.”

“Green investment continues to gain momentum globally and the KPMG Green Tax Index provides a greater understanding of the entire financial picture of green investments, pre- and post-tax,” added KPMG’s Hickox.

Ranking of Additional Global Economies

Japan is ranked 2nd overall but, in contrast to the United States, scores higher on green tax penalties than it does on incentives. Japan also leads the ranking for tax measures to promote the use and manufacture of green vehicles.
The United Kingdom ranks 3rd and has a green tax approach balanced between penalties and incentives. The United Kingdom scores most highly in the area of carbon and climate change.
France occupies 4th place in the overall ranking with a green tax policy more heavily weighted toward penalties than incentives.
South Korea ranks 5th, and like the United States, has a green tax system weighted toward incentives rather than penalties. South Korea leads the ranking for “green innovation” which suggests that South Korea is especially active in using its tax code to encourage green research and development.
China ranks 6th with a green tax policy balanced between incentives and penalties and focused on resource efficiency (energy, water and materials) and green buildings.

“The very investments that can drive change and secure competitive advantage may never be made if green tax systems are not fully understood and used,” said KPMG’s Gimigliano. “Investments that struggle to make a case on a pre-tax basis can flourish after green tax analysis. Companies should not underestimate the potential of green tax incentives to deliver efficiency and productivity benefits, drive innovation and contribute to the bottom line.”

SOURCE KPMG LLP

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POPSCI NEWS

Posted on 17 April 2013 by Africa Business

  • 5 Ways Drones Could Help In A Disaster Like The Boston Marathon Bombing
    Plus three robots that are already saving lives.

    Yesterday, the President of the Association for Unmanned Vehicle Systems International Michael Toscano told U.S. News: “Whether it is in response to a natural disaster or a tragedy like we saw in Boston, [unmanned aerial systems] can be quickly deployed to provide first responders with critical situational awareness in areas too dangerous or difficult for manned aircraft to reach.”

    Is he right? Well, he’s not entirely wrong. Drones, like manned helicopters used by police and emergency responders, can hover, provide a great overall picture of action on the ground, and direct aid to where it’s needed. The trick is that, right now, drones don’t do that uniquely, which is what a sales pitch on their special capacity demands. Boston did in fact have a police helicopter flying overhead, and the problem of low fuel reportedly overheard on the police scanner is a problem that another helicopter could have solved just as easily. Drones aren’t particularly special in disaster relief-yet.

    As drone tech advances, we could soon see remotely piloted vehicles joining the ranks of police departments and emergency response organizations. Here are five drones that might save a life in a future disaster.

    1. The MQ-8C Fire Scout: This full-size, unmanned helicopter could ultimately replace police or medical evacuation helicopters. The crew compartment can, among other things, be converted to hold an EMS team for medical airlift, or extra fuel to stay aloft longer.

    2. Quadrotors: Drones like the Aeryon Scout provide a wealth of video coverage, spying on rooftops and moving in fearlessly to document a blast zone. (Of course, civilian smartphones did much of that work in Boston.)

    3. Swarm of Swiss robots: By emulating the patterns ants use to hunt for food, these swarming drones can efficiently scan a large area and then converge where they are needed-a strategy that requires an awful lot of manpower when it’s used by human search-and-rescue workers.

    4. Incredible HLQ: This quadrotor is designed to carry relief supplies to places people can’t access, or can’t access fast enough, during an emergency. It’s in development now after a successful Kickstarter campaign.

    5. The Pars Aerial Rescue Bot: While not strictly applicable to Boston, this Iranian lifeguard quadrotor could aid in disasters along coastal areas, flying through severe weather to rescue people from drowning.

    Flying machines aren’t the only rescue robots we can expect in the future. Unmanned ground machines also have a lot to offer. CHIMP, a monkey-tank-robot created by Carnegie Melon, is designed specifically to climb over rubble or up ladders to save people in collapsed buildings. DARPA’s Robotics Challenge, in which CHIMP is an entrant, has inspired several robots designed to take the place of humans in emergency situations.

    Three types of ground robots are already saving lives around the world:

    1. A whole fleet of earthquake-response rescue robots: These are currently at work in Japan, and they include the RoboCue victim-recovery bot.

    2. Talon: QinetiQ’s bomb-disposal robot made a name for itself fighting IEDs in the Iraq War. There’s also a police version available.

    3. The Land Shark EODS: This remotely controlled robot is used to detonate explosives safely away from people. Massachusetts State Police have at least one on hand.

    The future will certainly see more robots rushing to save lives, and undoubtedly some of those will be flying. The future promise of flying rescuers, however, should not distract us from the actual ground robots that are being used in Boston presently.

        

  • FYI: Can Humans Get High On Catnip?
    Samantha J. Kitty fiending for some catnip Evan Kafka via Suzanne LaBarre
    Related: Can cats get high on marijuana?

    While cats may feel effects from marijuana-no word on whether Sir Harry Paus actually likes the experience-“kitty pot” does not have a reciprocal effect on humans.

    In the late 1960s, some researchers reported catnip gave people a marijuana-like high, but it turned out they had simply mixed up the two plants. As veterinarian Arnold Plotnick of Manhattan Cat Specialists in New York wrote to me in an email, “Think about it… catnip is cheap and legal. If it had a significant effect on people, everyone would be smoking it.”

    Meanwhile, cats do feel effects from marijuana, but it may be scary for them. “Animals can’t understand they’re being intoxicated, therefore it can cause considerable anxiety,” says Bruce Kornreich, associate director of the Cornell Feline Health Center in upstate New York.

    It’s not clear why the active chemical in catnip, nepetalactone, doesn’t affect humans, Kornreich says. Pot affects cats because like many mammals, including humans and dogs, cats have receptors in their brains for pot’s active chemicals, cannabinoids. Cannabinoid receptors make pets susceptible to feeling symptoms when they inhale secondhand smoke or, more commonly, accidentally eat their owners’ stashes. (It’s actually a bigger problem with dogs, he says, because dogs eat everything.)

    Kornreich has seen pets come into veterinary emergency rooms after marijuana exposure. “The pets are presented for anxiety, active heart rate, acting a little unusual,” he says. “They may react differently to sound and to being touched” perhaps because, like humans, drugs alter their perception.

    Kornreich urges pet owners to take their pets to a vet if this happens, adding that vets are not required by law to report marijuana they run into during their practice. Most veterinarians care more about making pets better, he says. “It’s more just focused on the well-being of the patient.”

    He also strongly discourages purposefully exposing a pet to marijuana. Fido and Kitty can’t consent to getting high. “I don’t think it’s right or fair to make that decision for an animal,” he says.

    If pot affects cats because they have cannabinoid receptors, does that mean people aren’t affected by catnip because they don’t have nepetalactone receptors? Scientists aren’t sure. “While it seems that this is a reasonable hypothesis to explain why humans don’t respond to catnip like cats do, I cannot find any studies that rigorously test it,” Kornreich says. While many brain receptors are common across different animals, many receptors also differ, so it wouldn’t be unprecedented for humans to lack a receptor present in cat brains.

    In cats, inhaled nepetalactone stimulates the olfactory bulb, the part of the brain that processes odors. The olfactory bulb then interacts with the amygdala, the brain region associated with emotion and decision-making, and hypothalamus, which controls a variety of bodily functions. From the hypothalamus, nepetalactone stimulates a sexual response in cats that are genetically predisposed to sensitivity to catnip. (About 20 to 30 percent of cats don’t seem to react to the plant.)

    Some insects seem to react to nepetalactone, too. Strangely enough, chemical companies are studying nepetalactone because it seems to repel mosquitoes, ticks and mites, like a kind of natural DEET. For the insects to change their behavior around nepetalactone, even if negatively, suggests that they have nepetalactone receptors.

    As for smoking catnip: not only does it fail to get people high, it can make them feel pretty awful. Too much catnip, whether smoked or drunk as a tea, could cause headaches and vomiting.

    Have a burning science question you’d like to see answered in our FYI section? Email it to fyi@popsci.com.

        

  • Audi Wants Its Cars To Predict Where Traffic Will Be
    Traffic Jam epSos.de
    Side-stepping traffic by mining data

    At the GPU Technology Conference 2013 show in San Jose, Audi announced some of its plans for its Cars of the Future, The Register reports. One of the coolest ideas: cars that can predict where traffic will be, so drivers can avoid it.

    The amply named Predictive Traffic function would mine traffic records and current reports, including social media, as well as scheduled events like sports games that could bring cars to a standstill. The system, under Audi’s plan, could also predict a driver’s most likely destination based on their traffic history.

    Pretty neat! Along with that, Audi announced a concept for a reworked directions system that would operate in a “human-like” way, giving directions based on landmarks instead of streets. A Smart Parking feature would work similarly to the traffic-predicting system, but do it for parking spots: mapping out available spots and prices for those spots, rather than making you drive around in circles hunting one down.

    We don’t have too many details yet on exactly how these systems would work, but since Audi did make a self-driving car, hopefully we’ll see these projects come to life soon, too.

    [The Register]

        

  • Magnetic Brain Stimulation Removes Craving For Cigarettes
    Smoking Kills Challiyil Eswaramangalath Vipin via Wikimedia
    Don’t worry, it doesn’t hurt!

    Scientists at Medical University of South Carolina temporarily blunted cigarette cravings among smokers by magnetically stimulating nerve cells in their brains. The procedure, called transcranial magnetic stimulation, is already approved by the FDA to treat depression, though its efficacy is controversial (it’s also been prescribed to stop people from lying and treat adult ADHD.)

    In the experiment, researchers randomly assigned 16 smokers to either a 15-minute session of high-frequency transcranial magnetic stimulation (in which coils placed over the forehead send magnetic pulses into the prefrontal cortex), or 15 minutes of sham treatment. The magnetic stimulation isn’t painful and doesn’t require sedation or anesthesia. The scientists told the volunteers not to smoke for two hours prior to the experiment.

    Before the treatment, the researchers showed the smokers both neutral images (such as mountain scenes) and images intended to provoke nicotine cravings (such as a person lightning a cigarette.) Then they asked the volunteers to rate how they felt about statements like “I would do almost anything for a cigarette now” and “I am going to smoke as soon as possible.” After the magnetic stimulation, the participants saw similar images and again rated how much they craved a cigarette.

    The researchers found that the participants who got the real magnet treatment expressed significantly less desire to smoke at the end of the experiment compared with those who got the fake treatment. In fact, the craving reduction was positively correlated with how nicotine-dependent the volunteer was, meaning that those who smoked the most saw the greatest decrease in cigarette craving after the magnetic stimulation.

    The authors of the study note that people trying to quit smoking would need several sessions of transcranial magnetic stimulation per day in order to see longer-lasting reductions in cravings. The paper appears in Biological Psychiatry.

        

  • Everything You Need To Know About Ricin, The Poison Mailed To President Obama
    Ricin (on Breaking Bad) via Breaking Bad Wiki
    Ricin is one of the most poisonous substances on Earth, it’s scarily easy to make, and somebody is mailing it to the President and at least one U.S. senator. What it is, how it works, and more, inside.

    Yesterday, an envelope addressed to Senator Roger Wicker, Republican of Mississippi, was found to contain a white granular substance that was identified as ricin. Today, a similar letter addressed to President Obama was found. These envelopes were intercepted off-site–they never got anywhere near their targets–but as a precaution, Capitol Police have shut down mail service until they can figure out what’s going on.

    In the meantime, let’s talk about ricin!

    How poisonous is it?
    Oh, man. Very. It’s dangerous in just about any way it gets into your system, though ingesting (eating) it is about the least dangerous way. Injecting or inhaling requires about a thousand times less ricin to kill a human than ingesting, and that’s a very small amount indeed. An average adult needs only 1.78mg of ricin injected or inhaled to die; that’s about the size of a few grains of table salt–which ricin resembles visually.

    How does it work?
    Ricin, a toxic protein, infects cells, blocking their ability to synthesize their own protein. Without cells making protein, key functions in the body shut down; even in survivors, permanent organ damage is often the result of ricin poisoning. It’s a highly unpleasant way to be poisoned: within six hours, according to the Center for Disease Control, victims who have ingested ricin will feel gastrointestinal effects like severe vomiting and diarrhea, which can lead to serious dehydration. Then the ricin infects the cells of the vital gastrointestinal organs as they pass through the body, leading to the failure of the kidneys, liver, and pancreas.

    Inhalation of ricin has a different effect, since the ricin proteins aren’t interacting with the same parts of the body. Instead of gastrointestinal problems, you’ll develop a vicious, bloody cough, your lungs will fill with fluid, and eventually you’ll lose your ability to breathe, causing death. Injection, too, is different, depending on where you’ve been injected, but will generally result in vomiting and flu-like symptoms, swelling around the place of injection, and eventually organ failure as your circulatory system passes the protein around the body. Death from inhalation or injection usually occurs about three to five miserable, agonizing days after contact.

    Interestingly, there aren’t any immediate symptoms, and indeed there can be a significant delay before symptoms show themselves, up to a day or two.

    Exposure on the skin is generally not fatal, though it may cause a reaction that can range from irritation to blistering.

    That sounds…horrible. Is there an antidote, at least?
    Haha. No. The US and UK governments have been working on an antidote for decades–here’s a nice article describing the progression of one such antidote–but there isn’t one available to the public. The CDC’s website states bluntly, “There is no antidote for ricin toxicity.” There are some steps you can take if you get to a hospital immediately; for ingestion, a stomach pump can sometimes prevent the ricin from reaching the rest of the gastrointestinal system at its full force. But…that’s about it, really.

    How does it stack up against other poisons?
    Well, that depends on what your aim is. Ricin is much easier to produce than other popular biological weapons like botulinum, sarin, and anthrax, but it is not as potent as any of those, which limits its effectiveness as a weapon. It also is not very long-lived; the protein can age and become inactive fairly quickly compared to, say, anthrax, which can remain dangerous for decades. There were experiments back around World War I attempting to make wide-scale ricin weapons, packaging it into bombs and coating bullets in it, but these proved not particularly effective and also violate the Hague Convention’s agreements on war crimes, so the US discarded ricin.

    It’s much more effective, weapon-wise, as a close-contact, small-target weapon–by injecting, as with Georgi Markov, or by putting small particles into an aerosol spray and blasting a target. It’s also not contagious, which limits its effectiveness as a tool of biological warfare. But it’s considered highly dangerous partly because it’s still outrageously toxic and partly because it takes no great skill to produce.

    So it’s not hard to make?
    Well…no. Like, not at all. It’s made from the byproduct of the castor oil manufacturing process. You take the “mash” of the castor oil seeds, which contain around 5-10 percent ricin, and perform a process called chromatography. Chromatography is a blanket term for a set of techniques used to separate mixtures, usually by dissolving in liquid or gas. The US government has done its best to eradicate recipes for ricin from the internet, sort of; a patent was filed back in 1962 for ricin extraction, and the Patent Office took it off the publicly available server in 2004 for safety reasons. That said, the recipe is super easy to find; here at the PopSci offices, I’m blocked from listening to Rdio on my work computer, but I found a recipe to make an outrageously deadly poison in about a minute.

    The techniques involved are undergraduate-level chemistry, creating a slurry with the castor bean mash and filtering with water and then a few easily-found substances like hydrochloric acid.

    It comes from castor beans?
    Ricin is a highly toxic protein that’s extracted from the seed of the castor plant, often called a “castor bean” or “castor oil bean,” despite not technically being a bean. The castor plant is extremely common; it’s used as an ornamental plant throughout the western world, prized for its ability to grow basically anywhere as well as its pretty, spiky leaves and weird spiny fruits. It’s also an important crop; the seeds are full of oil, and castor oil is used for lots of legitimate purposes. It’s a common laxative, for one thing, and since it’s more resistant to high temperatures than other kinds of vegetable oils, it’s a nice alternative to petroleum oil in engines.

    Wait, but you can eat it? So how is this a poison?
    Ah, yes. Castor oil is perfectly safe, according to the FDA and your grandma, but ricin is not castor oil. Castor seeds are still poisonous; this study says that a lethal dose of castor seeds for adults is about four to eight seeds. But the oil itself does not contain ricin; the ricin protein is left behind in the “castor bean mash” after the oil is extracted from the seed. Poisoning from eating the seed itself is rare.

    Have there been cases of ricin poisoning in the past?
    You mean, beyond the several times it’s been featured as a major plot point in Breaking Bad? Sure! The most famous is probably the assassination of Georgi Markov in 1978. Markov was a Bulgarian novelist, playwright, journalist, and dissident, and was murdered by the Bulgarian secret service, with assistance from the KGB, by ricin injection. He was crossing a bridge when he was jabbed in the leg with an umbrella, which delivered a ricin pellet into his bloodstream. He died three days later of ricin poisoning.

    There are plenty of incidents of people arrested for attempting (or, more often, succeeding) to make ricin; it’s a pretty easy poison to make. In fact, there was even another ricin-in-the-envelope attempt made back in 2003–a person identifying as “Fallen Angel” sent letters filled with ricin to the White House, apparently as a result of some new trucking regulations (seriously). “Fallen Angel” was never found, but the letters were intercepted and did not cause any injury.

    How dangerous are these envelopes filled with ricin?
    The envelope strategy has more to do with potential ease of getting the poison close to targets than its strength as a delivery system. If you’re targeting the President of the United States, it’s easier and more anonymous to mail a letter than to try to get close to him with an umbrella modified for ricin-stabbing. But it’s not a great way to poison someone with ricin. Assuming the letter actually got into the target’s hands, of the three ways ricin can get into a person’s system (inhalation, injection, ingestion), only one–inhalation–is really possible, and it’s not that likely.

    Inhalation as a weapon is best accomplished through a mist, ideally delivered through an aerosol. But that’s not possible in a letter full of powder. It’s possible that small granules of ricin could be released into the air and inhaled when handling the letter, but it is not an effective way to poison someone. And whoever’s sending these letters evidently doesn’t know that the government set up an elaborate mail-screening system after the 2001 Anthrax scare.

        

  • Mystery Animal Contest: Who Is This Fuzzy Sniffler?
    Guess the species (either common or Linnaean) by tweeting at us–we’re @PopSci–and get your name listed right here! Plus eternal glory, obviously. Update: We have a winner!

    So, here are the rules: To answer, follow us on Twitter and tweet at us with the hashtag #mysteryanimal. For example:

    Hey @PopSci, is the #mysteryanimal a baboon?

    And then I might say “if you think that’s a baboon, perhaps you are the baboon!” But probably not, because this is a positive environment and all guesses are welcome and also this is not a very common animal so guess whatever you want!

    The first person to get it right wins! We’ll retweet the answer from @PopSci, and also update this post so your amazing animal knowledge will be permanently etched onto the internet. Show your kids! Your dumb kids who thought that was a baboon!

    Update: And the winner is…Logan Copeman, who correctly guessed that this is a viscacha (Lagidium viscacia, also spelled vizcacha)! Specifically, this is a southern or mountain viscacha, a rodent found in South America. Yep, rodent: the viscacha is not related to the rabbit family, though it looks similar; the rabbit belongs to an entirely different branch of the evolutionary tree, and the fact that the viscacha looks so much like a rabbit is an example of convergent evolution. Convergent evolution describes when two species not closely related end up adapting to their environments in the same way.

    The viscacha lives in the southern Andes mountains, and is closely related to the chinchilla. It’s sometimes known as a long-tailed rabbit, thanks to its long ears and fluffy coat. It moves similarly to a rabbit, on very strong hind legs, hopping around its mountain home to eat a variety of grasses, mosses, and lichens. It lives in colonies, like all members of the chinchilla family, which can widely range in size. It’s not particularly rare; it is sometimes hunted for its meat and fur, but is believed to be holding steady, population-wise. Hi viscacha!

        

  • EuropaCity Is The Ultra-Green Mall Of The Future
    EuropaCity BIG
    Imagine a mall. Now imagine a mall in the year 2150.

    The design firm Bjarke Ingels Group (BIG), along with a few added team members (Tess, Transsolar, Base, Transitec, and Michel Forgue) have won first place in a competition to design an experimental “urban center” in France called EuropaCity. Located in Île-de-France, the wealthiest and most populous region in France, EuropaCity is intended to be a center of culture and retail, combining all sorts of experimental sustainable technologies.

    But as a design–and a pretty spectacular one at that–it’s best experienced through images. Click through to the gallery to see and read more about the proposal!

    Click to launch the gallery.

        

  • Nanosponges In Your Blood Could Soak Up Infections And Poison
    Nanosponge Engineers at the University of California, San Diego have invented a “nanosponge” capable of safely removing a broad class of toxins from the bloodstream, including toxins produced by MRSA, E. Coli, poisonous snakes and bees. The nanosponges are made of a biocompatible polymer core wrapped in a natural red blood cell membrane. Zhang Research Lab
    Mice who got nanosponge injections survived lethal doses of toxins.

    A newly invented “nanosponge,” sheathed in armor made of red blood cells, can safely remove a wide range of toxins from the bloodstream. Scientists at the University of California-San Diego inoculated some mice with their nanosponge, and then gave the animals otherwise lethal doses of a toxin–and the mice survived.

    This is especially interesting because a nanosponge can work on entire classes of toxins. Most antidotes or treatments against venom, bioweapons or bacteria are targeted to counteract a specific molecular structure, so they can’t be a one-size-fits-all solution; this nanosponge can.

    Scientists led by Liangfang Zhang, a nanoengineering professor at UCSD, worked with a class of proteins known as pore-forming toxins, which work just the way they sound: By ripping a hole in a cell membrane. These toxins are found in snake venom, sea anemones, and even bacteria like the dreaded drug-resistant Staph aureus. The proteins come in many different shapes and sizes, but they all work in a similar way.

    They designed a nanosponge to soak up any type of pore-forming toxins. It consists of a tiny (85-nanometer) plastic ball wrapped in red blood cell membranes, which basically serve as a decoy and soak up the poison. The plastic ball holds everything together, and keeps the protein away from its real cellular targets. The entire nanosponge is 3,000 times smaller than a full red blood cell. The devices had a half-life of about 40 hours when the team tested them on lab mice, according to a release from UCSD.

    They injected mice with 70 times as many toxic proteins as nanosponges, and the sponges still neutralized the poison and caused no visible damage to the animals, the team reports. Next up are clinical trials in animals, to verify that it works safely in a wide range of cases.

    The paper is in this week’s issue of Nature Nanotechnology.

        

  • Wearing A Kilt Could Make Your Sperm Stronger
    Temperature regulation is the key to fertility.

    Temperature affects how much sperm a man makes, so there’s been speculation that the freedom offered by a kilt can increase production. Turns out that that at least could be right: a new metastudy says wearing a kilt “likely produces an ideal physiological scrotal environment, which in turn helps maintain normal scrotal temperature, which is known to be beneficial for robust spermatogenesis and good sperm quality.”

    The study (PDF), published in the Scottish Medical Journal, reviewed the literature on the link between scrotal temperature and reproduction. We know sperm fares better in lower temperatures, and some researchers have suggested that restrictive clothing could negatively affect sperm production. Enter: the kilt, which author Erwin J.O. Kompanje describes thusly: “The Scottish kilt is a male garment that resembles (but is not!) a knee-length, pleated skirt.”

    The author hypothesizes that, based on past findings about temperature and sperm production, a kilt, specifically one worn in the undergarment-free “regimental” style, would be an ideal environment for sperm production. Kompanje searched through related research, focusing on statistics in Scotland and noting along the way that 70 percent of kilt-wearers choose to go regimental. Kilts (at least in Scotland or other countries where they’re more commonly worn) might also be psychologically valuable, increasing feelings of masculinity when worn. Kompanje goes so far as to write that a downturn in Scottish fertility is correlated with the frequency of kilts being worn, although he admits it’s still somewhat speculative until a randomized trial happens. Gentlemen, put on your kilts for science.

        

  • We Could Eat Trees: Scientists Turn Inedible Plant Cellulose Into Starchy Snack
    Turning plant byproducts into digestible carbs could feed more people.

    Someday, it will be be summer again and it will be time for fresh sweet corn. In the future, you might be able to eat the whole thing, cob and all.

    This weird possibility is courtesy of some scientists at Virginia Tech, who have transformed cellulose, a mostly indigestible polymer, into helpful, indispensable starch.

    Plants produce cellulose and starch, which are chemically similar, for very different purposes. Cellulose forms the cell walls of most plants, algae and even some bacteria, and we use it for anything from clothing (cotton is almost all cellulose) to paper to ethanol. Starch is a plant’s energy source, and it’s ours, too, in the form of tasty things like potatoes, wheat and corn. The difference between the two is a simple change in the hydrogen bonds that form the molecules.

    Animals like cows and pigs can digest cellulose thanks to symbiotic bacteria in their digestive tracts, but humans can’t. It’s important in our diets as source of fiber, in that it binds together waste in our digestive tracts. Y.H. Percival Zhang, an associate professor of biological systems engineering at Virginia Tech, set out to make it a food source.

    Since cellulose and amylose are both glucose chains, you would just have to rearrange their hydrogen bonds. This is anything but simple, although essentially Zhang and colleagues used chemistry. They worked with a series of synthetic enzymes to break down the hydrogen bonds in some plant material that would not otherwise be used for food, like corn cobs and leaves. The “enzyme cascade” enabled the cellulose molecules to reconfigure into amylose, which is a form of starch. A key ingredient in this process, a special polypeptide cap, is found in potatoes.

    The resulting product is not exactly the future of bread flour, but it can be used as a fiber source, or food-safe biodegradable packaging, perhaps. The remaining portion of the original material was treated with microbes to produce a form of glucose that can then be used for ethanol. The whole process didn’t require any unusual heat or chemical reagents, other than the enzymes themselves, so it would be easy to reproduce on larger scales, Zhang and his colleagues say.

    Cellulose is the most common carbohydrate–indeed the most common organic material–on the planet, so using it for food could be a superb way to feed millions of people, they argue.

    “There is an urgent need to use abundant and renewable nonfood agricultural and forest residues and dedicated bioenergy crops that can grow on marginal land and require low inputs,” they write. The paper appears this week in the Proceedings of the National Academy of Sciences.

        

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Today’s Links

Posted on 17 April 2013 by Africa Business

  • DARPA Unveils Teeny Infrared Camera With 5-Micron Pixels
    5 Micron Pixel Infrared Camera DARPA
    The secret to fighting a war at night? Tiny, tiny, tiny pixels.

    Human eyesight is such a limiting factor in military missions that DARPA is trying to fix it. Not with lasers; those are reserved for ships, but instead with a new infrared camera using pixels only five microns wide.

    Smaller pixels mean a high-resolution image can be captured in a tinier package. There are existing miniaturized infrared cameras, but their pixels are about three times the size of DARPA’s latest, and their resolution is at best half as good. The new technology has made it possible for the portable camera pictured above to do the work of the sort of long-wave infrared (LWIR) camera that till now has required a truck to carry.

    That tiny package should enable U.S. troops to finally master one of the great challenges of history: how to take advantage of the limits of enemy eyesight while bypassing the same limitation.

    Soldiers spent centuries figuring out the best way to see enemies at night without being seen. Early methods, like carrying torches, were more dangerous for the torch-carrier than his target, as the enemy’s eyes were already adjusted to the night, and the torches revealed where the advancing soldier was. In light of this, night attacks were relatively rare historical events, and daytime fighting remains the norm for regular armies.

    This is frustrating for commanders looking to exploit every possible advantage to win, because night attacks have some pretty distinct advantages. A larger portion of the enemy army is usually asleep, rarity adds an element of surprise, and the darkness, undisturbed by torches, lights, or a bright moon can conceal an army.

    Advancing without seeing is pretty difficult, however, which means a technological solution is the way around it. Night vision goggles, the ones with that famous green filter, amplify available light, which can turn low visibility into high visibility. The problem comes with regular light sources, which night vision also amplifies to a blinding extreme.

    Infrared, instead, focuses on a different part of the visual spectrum, and so is less affected by sudden changes in visible light. Previously, however, infrared cameras this advanced have been too large for individual people to carry, and instead had to be mounted on vehicles, which are not nearly as stealthy as troops on foot. With the new camera, DARPA hopes they can outfit individuals with such cameras, making night raids or defending against night raids that much easier.

        

  • Law Enforcement Thinks The Boston Bombs Were Constructed From Pressure Cookers
    A Pressure Cooker Wikimedia Commons

    According to NBC News, law enforcement is now saying that the bombs used in the attack on the Boston Marathon were constructed of pressure cookers filled with shrapnel. This is a common and low-rent bomb, typically made from a bit of TNT or other explosive in a sealed pressure cooker. They can be triggered remotely, and the pressure cooker itself turns into shrapnel. Time has a good history of the pressure cooker bomb, if you’re interested.

    Pressure cookers make ideal bombs; they’re inexpensive and legal, they’re designed to build up tremendous pressure while used legitimately, and can be outfitted with all sorts of timers and triggers, from stopwatches to garage door openers.

    Pressure cooker bombs were used as recently as 2006 to kill more than 130 people in Mumbai, and were part of the attempted (and failed) attack on Times Square in 2010.

    Read more at NBC.

        

  • Your Rented Computer Can No Longer Legally Spy On You
    Computer With Webcam Cropped from a photo by jbhalper on Flickr, CC BY-NC-SA 2.0
    Previously, some rent-to-own companies would log customers’ keystrokes and snap pictures using their webcams.

    According to a settlement that went into action yesterday (April 15), rent-to-own stores will no longer be allowed to peek at what their customers do. Previously, at least one piece of software allowed rent-to-own computer businesses to log their customers’ keystrokes and GPS locations, take screenshots of the rented computers while people are using them, and snap photos of users with the computers’ webcam.

    The new injunction only names eight companies, but it means that the U.S. Federal Trade Commission considers these actions illegal-and that applies to any other rent-to-own businesses that use similar software, Tracy Thorleifson, a commission attorney who worked on the case, tells Popular Science. The commission is also forbidding the company that made the software from “providing others with the means to commit illegal acts,” according to a commission statement.

    The software under fire is called PC Rental Agent–it was designed to help computer rental businesses in situations just like this. Ars Technica has a great description of PC Rental Agent’s different levels of features. Many are obviously helpful, such as the ability to clear a computer’s memory before renting it out to the next customer. But the software’s “Detective Mode” allowed stores to perform in-depth spying. It could also put up a fake “registration” notice on computers, enticing people to enter in their contact information.

    Tim Kelly, a co-founder of DesignerWare LLC and developer of PC Rental Agent, told Ars Technica that stores were only supposed to activate the spying features as a part of their efforts to recover the computer from would-be thieves. He also said he doesn’t agree with the Federal Trade Commission’s ruling, although he has settled.

    In a filing it made in September, the federal agency alleged that stores did not alert customers to the fact that the stores might be tracking and logging sensitive customer information such as social security numbers, banking information, and passwords. Because Detective Mode automatically snaps what it sees in computers’ webcams, many stores ended up with photos of kids, undressed people and people having sex. Stores often activated Detective Mode on computers that customers were late in making payments for, but didn’t intend to steal, the commission said.

    With the new settlement, rent-to-own companies can’t perform any spying on customers. They can’t put up fake registration notices. They can only track machines’ locations with customers’ consent.

    The settlement allows the commission to follow up on the eight named companies any time over the next 20 years, to make sure they’re complying.

        

  • Twitter Is The New Police Scanner
    Cambridge Police Department feed tweets from April 15th, 2013, responding to suspicious object reports and issuing all-clears. Twitter
    After the explosions yesterday at the Boston Marathon, police departments used social media to send out immediate updates.

    Since the mid-1970s, police scanners have been the only way for civilians to access real-time updates from police departments. Scanners work by flipping through multiple open radio conversations on emergency channels, providing an overall picture of a crisis from the people on the ground reacting to it. Because they offer fast and direct first-hand accounts, scanners have been invaluable for coordinating and linking emergency response.

    But yesterday, the real-time updates from Boston came mainly through Twitter. In fact, the news broke on Twitter more than 10 minutes before national media began reporting on the explosions. This photo was tweeted just four minutes after the first bomb went off:

    What the fuck just happened?#bostonmarathon twitter.com/theoriginalwak…

    — Tyler Wakstein (@theoriginalwak) April 15, 2013

    Deadspin was first to publish a news story, 13 minutes after the attack (and the post consisted almost entirely of updates from journalists and witness on Twitter.) As more news from Boston came in, I joined at least 53,000 people in following along with the Boston, Police, and EMS emergency feed. How’d I find the feed? Twitter. Over the scanner, authorities urged listeners and Bostonians to take to social media, as phone networks were likely to be overloaded. The Cambridge Police Department Twitter account became an invaluable source of information for many as it tweeted reports of new threats and then issued all-clears when appropriate.

    As with all security broadcasting, there’s a potential downside-nothing filters this information away from criminal ears or eyes, and easy access to police communication poses a risk to officers who could be ambushed.

    Some Twitter users have even begun transcribing mundane police scanner exchanges for a national, online audience. Mashable recently profiled Alex Thompson, the woman behind the @Venice311 Twitter account, which broadcasts scanner chatter in the Los Angeles metro area as easily-digestible written information. She was inspired to do so after witnessing a gross crime (literally, not metaphorically-someone dumped “50 gallons of raw sewage from his RV onto the street” where she lived.)

    Thompson isn’t alone in going directly from police scanner to Twitter. In January, students at Ohio University began tweeting scanner chatter from around Athens, Ohio, adding humor and college-specific insights.

    What makes Twitter the next logical leap from the police scanner is the immediate interactivity it provides the public: Police can respond to and broadcast inquiries like a real-time FAQ. And unlike scanners, Twitter isn’t regionally restricted, and it doesn’t cost $100 to $500 to access.

        

  • Ale Yeast Running For Official State Microbe Of Oregon
    Saccharomyces and Oregon State Seal
    I, for one, welcome our new unicellular overlords.

    Oregon lawmakers in the House just voted 58-0 to approve its new state microbe. If the state Senate also approves, Oregon will boast Saccharomyces cerevisiae, the humble ale yeast, as its unicellular avatar. It makes sense: according to Mark Johnson, the bill’s sponsor, the craft brewing business brings Oregon some $2.4 billion in revenues each year.

    Contrary to reports you’ll read elsewhere, Oregon is not the first state attempt to have its own microbe. That honor goes to Wisconsin. In 2010, lawmakers in the state Assembly tried to elevate Lactococcus lactis, the bacteria used to make buttermilk and cheese, to official state microbe. But the apparently narrow-minded or scientifically incompetent Wisconsin state Senate did not embrace the measure, and so the L. lactis bill languished. Recalcitrant politicians are why Wisconsinites can’t have nice things, but let’s hope that the Oregonian variety is a bit more enterprising. (It should be noted that Hawaiian lawmakers have also proposed two different, rare microbes to represent Hawaii, but neither have been made official, either.)

    While researching this story, I found an interesting letter to Microbe magazine from two microbiologists at Rutgers, The State University of New Jersey, on the topic. The authors mused that while Wisconsin (and now Oregon) have positive microbes associated with them, efforts by microbiologists to give other states their own microbes are up against some unsavory characters.

    If one were to choose a microbe historically associated with a state (due to it being discovered there or to its prevalence in the region) Montana would likely end up with Rocky Mountain Spotted Fever (Rickettsia rickettsii), Louisiana would get Hansen’s Disease, aka leprosy, (Mycobacterium leprae), Connecticut would inherit Lyme disease (Borrelia burgdorferi) and Nevada would merit gonorrhea (Neisseria gonorrhoeae). In 2010, another wag suggested certain cities should get their own microbe, and nominated Clostridium botulinum, the unicellular producer of face-freezing Botox, for Los Angeles.

        

  • How To Make Beer [Infographic]
    How 1933 brewed beer Popular Science archives
    Check out this beautiful 1933 brewing guide from the pages of Popular Science.

    When the United States ratified the Twenty-First Amendment in 1933, Popular Science celebrated the end of Prohibition by getting completely wasted (probably) and publishing this lovely infographic on how to make beer. “With the removal of national restrictions against the manufacture and sale of beer, American brewers are again in action,” said our June 1933 issue. “Their operations represent one of the most extensive applications of modern industrial chemistry.”

    Brewing beer hasn’t changed much in 80 years (and Popular Science still loves drinking it.) View the larger version of the infographic to see how the newly legal brewers turned barley into tasty, tasty beer.

    Read “Beer Making Is Marvel of Industrial Chemistry” in our June 1933 issue.

    This article originally appeared on PopSci.com on December 13, 2012.

        

  • The 3 People Who Love The Facebook Phone
    Facebook Home: Who’s It For? Facebook
    Spoiler: None of them are you.

    Professional reviewers have been positive about Facebook Home, the Android skin/launcher that turns your phone’s homescreen into a sort of portal for Facebook photos and messages. The reviews almost exclusively come to the same conclusion, saying things like, “if you’re a Facebook fanatic, you’ll love Facebook Home.” And yet it’s simultaneously described as a flop. There are a billion Facebook users. How can this app, which is entirely designed to give you more Facebook, be a flop?

    At the time of writing, the Facebook Home app has a 2.3 rating (out of 5) on the Google Play store. That’s a worse rating than an app that turns your phone into a “Hello My Name Is” sticker, so it seems fair to say the public response to Facebook Home has not been particularly positive.

    As BuzzFeed’s John Herrman articulated well here, the problem is that those “Facebook fanatics” the reviewers are so sure will love this phone don’t really exist anymore. Teens, who made Facebook what it is, all have Facebook, but they don’t interact with it to the degree they used to, according to a recent Piper Jaffray survey. They spend less time on Facebook than ever before–it’s something that exists, but as a utility, not something they’re passionate about. It hasn’t been embraced by the older generation, either; there’s already LinkedIn, which is mostly a “grownup” version of Facebook. Rusty Foster summed it up (on Twitter, no less) this way: “Young people think FB is for the olds. Old people think it’s for teens. No one thinks ‘Facebook is for people like me.'”

    I searched through social networks, search engines, reviews both professional and amateur, trying to find someone, anyone, who legitimately likes Facebook Home and finds that it suits their mobile lifestyle. It was pretty much futile. The reviews on Google Play are littered with thoughts from the Android tinkerers; they want to try out any alternative launcher, especially a free one, because why not? They’ll try anything. They mostly write things like “It seems to work fine for what it is” and “I guess if i was a facebook-holic id be more excited about it but im not” [sic]. There are plenty of 5-star reviews, but they are almost exclusively either vague “Great job Facebook!” comments or compliments for the aesthetics of the app–most of whom note that they, too, won’t be using it.

    Commenter Dan Reichert wrote, “this is by far the best Android product facebook as produced. Unfortunately I will not be using it as my life doesn’t come close enough to revolve so much around facebook. It’s definitely a solid app though.” That’s the equivalent of the professional reviewers saying that those who love Facebook will love Facebook Home–but they don’t, nor do they really know anyone who does.

    Here’s who loves Facebook Home:

    1: Advertisers

    Business Insider spoke to a few advertising execs, who misguidedly adore Facebook Home. Advertisers love Zuckerberg’s pitch: More user engagement for “Facebook addicts,” clicking more stories, spending more time looking at photos and reading status updates. Advertisers will be able to insert ads into Facebook Home–ads were part of the original pitch–and get more eyeballs on their ads.

    2: Google

    Google’s Executive Chairman, Eric Schmidt, loves Facebook Home. Sort of. He gave a speech during the All Things D conference in which he talked about Facebook Home in terms that made it seem as though Google was permitting the launcher rather than in love with it. Facebook had “read the rules and adhered to them,” he said, not exactly a ringing endorsement. His moment of actual enthusiasm came later. “I think it’s a tremendous endorsement of the [Android] platform,” he said. “And what you can do with it.”

    3: Mark Zuckerberg

    In an interview with Wired, Zuckerberg noted that he’d “love” Facebook Home to move outside of Android to other mobile operating systems like Apple’s iOS and Microsoft’s Windows Phone. “I think people really care about Facebook,” he said. “In a lot of ways, this is one of the best Facebook experiences that you can get.”

    Aaaaaand…that’s it. The people who love Facebook Home aren’t Facebook fanatics or Facebook addicts or Facebookaholics. They’re people with a vested financial interest in the success of the app. And that doesn’t bode well for its success; it doesn’t matter if they like it. It matters if we like it.

        

  • New Surgical Tape Works Like A Parasitic Worm
    Spiny Proboscis An artist’s rendition of Pomphorhynchus laevis, a parasitic worm Image courtesy of Karp lab
    The bandage is inspired by the spiny proboscis of the intestine-infecting Pomphorhynchus laevis.

    Scientists have built a better bandage that’ll stick to you like a leech. Literally. The new prototype adhesive bandage sticks even to wet skin, using a technique inspired by a parasitic worm that attaches itself to the insides of its hosts’ intestines. Yum.

    In the future, for certain surgeries, the bandage could replace stitches, staples and adhesive tapes that are already on the market, the bandage’s inventors wrote in a paper they published today in the journal Nature Communications. Compared to sutures and staples, the bandage is quicker and easier to use, and it sticks better than other tapes, they wrote. In addition, its surface of small spines could inject drugs into the skin, they said.

    The inventing team, including researchers from universities and hospitals in the Boston area, got their inspiration from a worm that infects freshwater fish. The worm, Pomphorhynchus laevis, has a spine-covered proboscis on top of its head. The body part looks a bit like a small cactus. When it infects a fish, the worm plunges its proboscis into the fish’s intestinal wall, and then, using muscles, plumps up the “cactus,” giving it a firm grip inside the fish’s tissue.

    The new bandage is covered with a neat array of tiny spines made of a special combination of plastics. The spines are normally stiff and easily pierce the skin. Once the spines contact water inside the skin, however, they plump, locking themselves inside the skin. In experiments done on pigs, the bandage held 3.5 times better than surgical staples.

    Although this pierce-and-plump method sounds painful, the new bandage actually damages the skin minimally because the spines are small and don’t penetrate into the skin very far, the Boston team wrote. Removing the bandage also is minimally damaging compared to other surgical stitching techniques, they said.

    [Brigham and Women’s Hospital via EurekAlert]

        

  • Zap Away Would-Be Attackers With This 3800kv Anti-Rape Bra
    Anti-Rape Bra SHE via BBC
    Feeling unsafe? Switch on your protective lingerie.

    In the wake of a highly publicized series of brutal rapes in India, a group of engineering students devised a way to help women deter sexual assault: Make their underwear a weapon.

    Manisha Mohan, a 20-year-old student at SRM University in Chennai, developed an undergarment called the “Society Harnessing Equipment,” or SHE, with two of her friends in response to the December gang rape of a 23-year-old student in Delhi.

    The white nightgown’s bra area is lined with pressure sensors calibrated to differentiate between more violent actions like squeezing, pinching or grabbing as opposed to say, hugging. Women can switch the garment on when they feel they might be unsafe. If the pressure sensor is activated, SHE sends a 3800kv electric shock through the garment, up to 82 times. The wearer is insulated from the shock by a polymer lining on the inner side.

    It’s also designed to alert others of the danger by sending a text message to a family member or friend and to the police with the wearer’s GPS location.

    The team is still working out a few kinks, like figuring out how to make it machine washable, and Mohan told the BBC they’d like to make the electronics smaller and link them to a smartphone app through Bluetooth.

    “My vision is to see every women [sic] walking confidently on the streets in all parts of the world, even at odd hours,” Mohan told the BBC.

    [The Daily Beast]

        

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