CATALINA’S® Fine Chocolate – Costa Rica

The Spirit of Costa Rican Fine Chocolate

Limon Province and Heredia, Costa Rica 2018

Introduction, Background and Executive Summary

A revolution is underway in the global trade and production of quality cacao beans into nutritious, fine craft chocolate. For centuries, the raw material producers of cacao in the tropics did not process the finest chocolate-making machinery like the rest of the world.

From January 2019, a strategic alliance between two Costa Rican professionals (a plantation agronomist – Moises Gomez) and his wife (Catalina Valerio – a processing engineer) with a Canadian multinational business executive (Robert Stewart) and Monacan investor (Machteld Schrama) join forces to create the world’s first vertically integrated plantation-to-fine-chocolate processing company operating in Costa Rica.

Breaking this North-South global market divide by integrating a 4,000-year-old source of traditional cacao beans with the finest chocolate production marks a dramatic departure in the world of cacao/cocoa/chocolate.

A line in the sand will be drawn between an industrial product today consisting mainly of soya and poor quality non-Latin American cacao beans, manufactured under modern industrial processes in the Northern Hemisphere and sold to a global mass market will be challenged by a healthy, nutritious, locally-processed chocolate from its own exceptional plantation cacao beans in Costa Rica. Cacao are beans from the original tree and their ingredients kept intact with full nutritional value. Cocoa is the overly-processed beans, usually in the form of powder and heavily mixed with refined sugar and other ingredients.

Industrial chocolate consists of overdoses of unhealthy, refined and addictive sugar, soya additives, chemicals and false advertising. The new craft product will promote a healthy ‘Super Food’ using pure traditional cacao beans and raw sugar cane based on a formula which sustained Central American peoples for many millennia. We call it “La Pura Vida”, Costa Rica’s contribution to a true, honest, and healthy food product coming from the finest original beans, with no manmade additives or extractions.

Catalina’s fine chocolates will be produced by the world’s first company to own and operate its own 70-200 hectare cacao plantation and process a finished craft chocolate to be run by the family of Moises and Catalina Gomez-Valerio.

The quality artisan chocolate market had a great revival in Europe and North America between the end of the ‘90s and early 2000 thanks to the extraordinary ability of some chocolatier colleagues who were the first to educate the consumer about the diversity of the cacao origins, the cultivation techniques and processing but also and above all the organoleptic and nutritional/medicinal qualities of chocolate.

The artisan chocolate market experienced a few years of interesting growth, inducing the industry to differentiate itself and to address the issues that were previously exclusively promoted by small chocolatiers. On the shelves of supermarkets began to appear single origin chocolates, different percentages of cocoa, spices … the differentiation themes began to be diluted and the crisis of the artisanal quality market began.

This crisis lasted for a few years with weak and very risky attempts at differentiation. After a few years, many chocolatiers were downsized, some had to close, the most interesting forced to sell to large companies. What was missing was the ability to innovate, to remain a precursor, to know how to communicate diversity.

Raw cacao beans: The last few years witnessed the flowering of new initiatives that, following the model of what is happening in the US and in the Anglo-Saxon market, are following new paths of differentiation.

The new eldorado seems to be the “bean to bar” and “pure, raw chocolate”. On the widespread recent interpretation of the “bean to bar” there are strong doubts about the quality of the final result and the alleged control of the supply chain if one doesn’t own the plantation beans, ferment them oneself and process them to completion.

Regarding the theme of raw chocolate: there is a serious problem of how it is currently defined (chocolate in which the temperature of 42 degrees is not exceeded throughout the supply chain and throughout the production process), raw chocolate (as defined) does not exist. In our opinion there are reasons that imply the impossibility:

– The temperature of cacao in fermentation is certainly higher than 42 degrees and cannot be so punctually controlled;
– The bacterial load without a rise in temperature can be very dangerous;
– If there is no third body that can check and certify what is declared by the raw producers throughout the supply chain then there are reasons for opportunities:
– Only through exceptionally controlled fermentation is it possible to make available the nutrients and functional capabilities of cacao;
– Roasting, although light, is necessary to develop the aromatic notes of cacao.

The goal of the raw food approach is to preserve as much as possible the nutrients and functional properties of the cacao raw material used in the first place. To sum up, we think this fundamentalist approach is wrong because: it cannot be applied, it cannot be certified, it is counterproductive to the stated objectives, it does not guarantee food safety, and the process followed does not lead to an organoleptic quality.

Raw bar: We believe instead that it is possible to achieve the objectives stated by the raw food approach using well-fermented cacao beans, toasted for a short time and not too high temperatures, working cold chocolate without conceal and that this approach allows us to have a good product, safe and with highly functional properties.

This is why we called it pure CATALINA Fine Chocolate. It consists of only agricultural raw materials, cacao and raw sugar cane, which are worked as little as possible. A direct, aromatic and persistent chocolate which is organic, cold worked, and gluten-free.

The CATALINA plantation is located in NE Costa Rica alongside the Tortuguero National Park and the Caribbean Sea. This was for centuries, the cradle of the cacao bean which sustained Central America as a currency, a highly nutritional drink and a food rich in minerals, vitamins and many other healthy anti-oxidant nutrients. An automated Italian FBM production line will process the beans into a world-class fine chocolate for export.

Grown on the volcanic soils in a tropical rain forest, this traditional approach returns to the centuries-old formula of using two ingredients only: all of the cacao mass, butter and liquor contents of its original pure Criollo and Triniterio beans blended with local, pure, raw sugar cane filled with additional energy nutrients, vitamins and minerals.

Varying in cacao/cane sugar combinations up to 70/30%, CATALINA will produce four chocolate varieties: a pure, dark, craft chocolate; milk chocolate; mid-range chocolates mixed with fruits/nuts/herbs; and white chocolate.

The product will be sold to consumers directly and for further use in pastries and other products. The products support good health to avoid sugar addiction, diabetes and obesity. Children will be introduced to a healthy chocolate avoiding addictive and refined beet sugar. The worst outcome from eating 95% of today’s industrial chocolates which cause most of the Northern Hemispere’s health challenge: heart attacks and acute coronary disease. There is a reason craft chocolate is called “The Medicine of the Gods”.

The entire operation will be built, owned, operated and controlled by the group.  Moises Gomez is a professional agronomist and expert with the International Cocoa Organization in London for 11 years, advising growers worldwide in growing better cacao. He has perfected the fermentation and drying of the beans rarely seen in industrial chocolate production anywhere in the world.

The use of the very high quality, fermented Criollo and Triniterio beans, grown for centuries in the Western Hemisphere, is in stark contrast to the lower quality and less-controlled Forastero beans from other continents which make up +80% of industrial chocolate production blended with other contents lacking nutritional value.

Moise is overseeing the planting of 70-200 hectares of cacao trees as well as helping other local plantation growers to achieve the same high results in their beans throughout Costa Rica and the region.

Some of these acceptable beans will be blended with the family-owned plantation-sourced beans. FBM in Legnano, Italy are the chocolate machine manufacturers who are providing the entire processing line.

Catalina Valerio, wife of Moises and mother of their two boys, is a graduate process engineer who has managed the family banana and dairy farm on 600 hectares. She will manage the factory processing the beans into fine chocolate varieties for sale domestically and into the high-end European and North American markets. The products are named for her.

Few other companies will produce an equivalent high-quality chocolate from world-class beans and no other company will have a vertically integrated company owning the entire process from plantation to bar. Eugenia Valerio  acts as the in-house legal counsel for the company in Costa Rica. Reg Olson (USA) is our civil, electrical and mechanical engineer assisting with the plant design, layout and operations.

This will not only be a world first, but the only factory (in Heredia near San Jose) to grow the beans in the country of origin, and also process them into the high, value-added finished products for export.

For centuries, cacao growing and chocolate production have been separated into different ownerships and operations, causing a dysfunctional market which does not support local farmers, improve the quality of crops, sustain a fair price to farmers or promote anti-slavery amongst children in Third World settings.

Catalina’s workers will be fully integrated into the company’s long-term growth strategy with support in employment, training, wages and family life. This is a far cry from present conditions worldwide in spite of efforts by Fair Trade, Rain Forest Alliance and other organizations purporting to support farmers but rarely passing on verifiable benefits. It is one of Catalina’s key building blocks.

Robert Stewart (Laren, Netherlands) and Maggie Schrama (Monte Carlo, Monaco) will oversee CATALINA’s product distribution worldwide through chocolateries dealing in fine quality products, high end hotels, restaurants, airlines, coffee shops, wine outlets, supermarkets, health/fitness centres, and networks that support genuine fine chocolate.

These will start in Europe with Netherlands, Switzerland, the UK, Monaco, other EU countries and progress to sales in North America, the Middle East and Asia. Children will be taught to eat non-addictive, non-obesity forming and non-diabetes related industrial chocolates in which sugar plays a devastating role in contributing to these serious diseases including cardiological impact.

These conditions represent the three largest health problems worldwide, especially in Europe and North America. Given the highly addictive impact of refined white beet sugar and other substances found in over 95% of a modern industrial product falsely marketing itself as a ‘chocolate’, CATALINA fine chocolates will offer the opposite.

Description of a multi-phased production line of processing cacao into fine chocolate.

CATALINA will lead a revolution in creating a fine, craft chocolate which is highly nutritional, healthy and safe for all age groups. High quality fine chocolate which contains in all of its original beans including the total cacao mass, butter and liquor, has been proven in hundreds of clinical trials to provide a healthy, nutritional, even medicinal food product. CATALINA fine chocolates will be labelled and branded as ‘Super Food’.

Years of scientific, laboratory research projects by Dr. Stephen Gundry (California, USA), Dr. David Katz (Yale University, USA), Dr. Rob Verkerk (Dorking, UK), and nutritionists Suzie Sawyer (a UK dietary advisor in the Prime Minister’s Office) and Meleni Aldridge (UK), have consistently proven that +70% pure cacao products contain the following healthy positives:

  1. Fine dark chocolate has excellent antioxidant properties, is rich in flavonoids, which are naturally forming from the original cacao. The primary antioxidants present in fine, dark chocolate include catechin, epicatechin, and proanthocyanidins.
  2. Chocolate reduces platelet aggregation, particularly due to its epicatechin content. This reduces the risk of heart attack or stroke.
  3. It lowers blood pressure, better renal function, and lowers the risk of cardiovascular diseases as well as cardiovascular mortality.
  4. In addition, the antioxidant effect of cacao directly influences insulin resistance, thus reducing the risk of developing type 2 diabetes.
  5. Furthermore, cacao consumption stimulates changes in redox-sensitive signalling pathways involved in gene expression and the immune system, thus boosting the immune system.
  6. Cacao protects nerves from injury and inflammation.
  7. It protects skin from ultraviolet-induced oxidative damage.
  8. It improves cognitive function and mood.
  9. The major benefit of eating chocolate is to lower the risk of cardiovascular diseases, including myocardial infarction. In patients who already suffered from myocardial infarction, eating chocolate twice a week reduced the risk of mortality from heart diseases by 66% compared to the group that never consumed chocolate.
  10. Chocolate may also be effective in reducing blood pressure as well as improving flow of blood through the arteries preventing atherosclerosis.
  11. Chocolate consumption on a regular basis lowers triglycerides and improves blood level of high-density lipoprotein (HDL) cholesterol.
  12. Preeclampsia is a major complication of pregnancy with cardiovascular manifestation and can be alleviated with dark chocolate intake.
  13. The recommended daily intake is not more than 25 g of dark chocolate per day is recommended for prevention of heart diseases and to obtain optimal health benefits.
  14. Milk chocolate is rich in calcium for healthy bones and teeth, but eating milk and/or white chocolate other than for enjoyment and taste provides only little benefit. It is recommended that milk chocolate not be consumed because milk proteins may inhibit absorption of antioxidant flavonoids present in chocolate.

The FBM Class of October 2018, in Legnano, Italy:  Formation of the CATALINA Fine Chocolate company. The Members: Moises Gomez and Catalina Valeria kneel at the front. Standing at the right, Robert Stewart (Swiss/ Canadian) and Machteld Schrama (Dutch resident in Monaco) will add investment capital and marketing support for the company.

Giuseppe Dichiano (in red), General Manager of FBM is overseeing the design and manufacture of the modern, new processing line which will start in the first year with 40/100 tons per year and build up to 400/500 tons per year over five years.

Section One: The Business Description:

  1. The proposed business plan describes to process, financial statement and action plan to establish a cacao-processing facility in the city of Heredia, Costa Rica, with the view to produce fine cacao-based products such as dark, milk and white chocolate, cacao nibs and couverture, for export to the European and North American markets.
  2. Costa Rica currently has a total of 3,500 hectares of cacao planted in the country, with an annual production of 650 tonnes of dried cacao beans. According to the International Cocoa Organization Fine and Flavour Cocoa Panel, Costa Rica produces 100% fine or flavour cacao due to the genetics of the planting material available in the country (ICCO, 2015). Although there is evidence that the genetic root-stock of the planting material in the country is considered fine and flavour, there are still knowledge gaps in the postharvest management of the cacao beans (fermentation and drying) which prevents some cacao beans to reach their highest flavour and aroma potential. As a result, cacao beans produced in the country can still improve flavour characteristics.
  3. The project idea started with the establishment of a cacao plantation in the province of Limón, Costa Rica, which is a family-owned plantation. Through the selection of high quality planting material such as Trinitario and Criollo trees and other improved planting material developed by the Centro Agronomico Tropical de Investigación y Enseñanza (CATIE), the plantation started with the establishment of 10 hectares of cacao from the year 2016 up to 2018. The total area destined for cacao production is estimated at 70 hectares, with the ability to expand the plantation to 200 hectares. Through a strict control of the production, fermentation and drying, the project will ensure the highest quality standards by developing and applying specific postharvest protocols for each cacao variety, which will allow us to develop unique flavour profiles for our wide range of proposed products.
  4. The project also expects to initially purchase cacao beans from other sources through the establishment of strategic partnerships with cacao producers in the country who have proven fine cacao Through our knowledge of the Costa Rican cacao sector, the project has identified potential cacao-producers who also apply strict postharvest protocols and are already selling dried cacao beans to craft chocolate manufacturers such as Dandelion, Potomac and SOMA in North America, and also to award winning chocolate makers in Belgium, France, the Netherlands and Germany.
  5.  The second phase of the project is the establishment of a cacao processing facility in the city of Heredia, province of Alajuela. It is expected that within the first five years of the project, the plant will reach a processing capacity of approximately 250-300 tonnes of dried cacao beans per year. The plant will source at least 50% of all cacao beans from the farm if the plantation is extended to 200 hectares. The plant expects to produce a range of cacao-based products using high quality raw material combined with some of the best craft-chocolate machines in the market. The high-end nature in the quality of these products allows the project to easily establish itself in international niche markets.

Product/Services

  1. The processing facility will produce a range of cacao-based products for different consuming markets. The core principal of this project is to use the best quality raw materials to produce exquisite flavour cacao and chocolate products which also provide a health-benefits. To allow the production of these fine products, the company will ensure full traceability of the cacao beans from the farm source to the processing plant. Strict quality controls will be applied to all cacao bean sources, whether it’s from its own cacao plantation, or from other cacao bean producers in the country.
  2. The ability to source fine flavour cacao beans from several parts of Costa Rica will allow the project to offer a range of flavours and qualities, serving a wide number of consumers and market ranges. Originally, the project will focus on four products: dark, milk and white chocolates (various presentations) as well as couverture for the pastry and restaurant markets.
  3. The main features of our project will be based on the flavour and health benefits of the product. From the organoleptic point of view, the project will generate fine flavour chocolates with a description of the geographic origins, the type of beans used, type of fermentation and roasting profile, and other information which will inform the consumer of its uniqueness and quality of the products. From a health point of view, the project will work with a community of scientists and food-chemistry experts to describe nutritional content and develop the health benefit information about the products, ensuring full transparency in our communication and marketing strategy.
  4. There will be a second line of products which is aimed for a more “commercial” consumers, which is chocolate products with lower cocoa content such as milk and white chocolates. These products will be marketed in hotels, banks, coffee shops, as a complementary product served with hot beverages (mainly coffee). A third line of product will be developed once the processing plant is fully operational. This line of products will be aimed for children and those wanting to start consuming fine chocolate products with higher cacao content. The project believes that “training pallets” is an essential strategy to ensure the long term sustainability of the project. We want to secure our consumers in the short and long term.
  5. An additional service that this project will offer to consumers is assurance that our project has social responsibility through our close collaboration with farmers’ groups and cooperatives from which we will source some of the cacao. At present, there a more than 12 cooperatives operating in Costa Rica. Some of these cooperatives produce Trinitario and Criollo cacao beans. However, due to their lack of knowledge about adequate post-harvest practices, most of these cacao beans do not reach their potential and are sold as bulk cacao beans with a discounted price.
  6. To add to this situation, there are several middle-man who take advantage of this situation and buy cacao beans at a price lower than the international market prices. This model is not sustainable either for the farmers (and their families) or the manufacturers who rely on good quality beans. We will work in close collaboration with some of these coops to assist them in improving their processes and also ensuring a fair price for their cacao beans.

Market Analysis

  1. Over the last decades the world chocolate market has experienced a steady increase in consumption. This increase in demand is partly due to new scientific information which shows that consumption of chocolates with high content of cacao (+70%), also known as dark chocolate, has a wide range of health benefits, from regulating blood pressure to reducing the risk of cancer. It is now widely recognized that cacao contains high levels of flavonoids, the same chemical compounds found in red wine and other food-products. This new range of chocolate products with higher cacao content, as opposed to the traditional confectionary product, is the major market driver for increase in consumption.
  2. Although the health benefits has being a major element in driving the increase in cacao and chocolate consumption worldwide, in recent years consumers in mature markets (mainly Europe and North America) are becoming more and more aware about the different qualities and organoleptic characteristics of the cacao bean origins. In addition, consumers are more aware about social and environmental aspects related to cacao production and manufacturing and are becoming more interested to know how cacao is produced and whether it meets basic standards of sustainability (environmental, social and economic). Our project will be able to “tick” the three boxes and ensure that this is communicated to our customers.
  3. Based on the experience of the project partners, there is an evident growing demand for higher quality chocolates in both the European and North American markets. More than ever, consumers are looking your unique and niche products to differentiate themselves. These products have to comply with ever more strict demands of social, environmental and economics sustainability for all those involve in the cacao and chocolate value chain.
  4. Costa Rica is a country that is able to project itself as a sustainable source of various products and is also a country committed to preserving its nature and all the resources that surround them. In the year 2012, Costa Rica took upon the challenge to become a Carbon Neutral country by 2021 (https://thecostaricanews.com/costa-rica-promotes-carbon-neutral-program-2021/). This environmental image, combined with other quality factors about or business model, will be a key marketing tool.

15. Although there are known chocolate brands in the European and North American markets, there is still not one well-known craft chocolate maker from Costa Rica in neither these markets. Considering the numerous factors that make Costa Rica and chocolate processing a unique product in various dimensions, there is a huge market potential for introducing and placing the first bean-to-bar chocolate manufacturer made in La Pura Vida!

Marketing Plan

The first production of bars will be shipped to Europe and introduced to the Netherlands, United Kingdom and other EU markets. Distribution channels will be established with chocolate venders, supermarkets, wine boutiques, restaurants, hotels, airlines, duty-free shops, and on-line marketing supported by videos, photos and lengthy descriptions of the plantation and processing operations in Costa Rica. Robert Stewart will oversee marketing from Netherlands and Monaco. The product will be heavily advertised in print, television and video media throughout Europe as a healthy, nutritious and unconventional, pure chocolate.

Assistance with be provided from Gordon Taylor in the UK, Reg Olson in the US and others. Packaging, labelling, contents, definitions, descriptions, pricing and distribution will be determined at the outset to appeal to 1.) the children’s market, 2.) health products, 3.) high quality pure cacao and 4.) consumers of all ages. Once a packaging machine has been purchased and placed in Heredia, the designs for labelling and packing will be completed.

Two of Catalina’s European representatives will travel to the largest Chocolate Fair in the world (CHOCOA) on February 21/22, 2019 and meet with 3,000 people engaged in the cacao, cocoa, chocolate trade. https://www.chocoa.nl/ . As other cacao/chocolate trade fairs take place around the world, CATALINA’S Fine Chocolates will present the products.

Catalina’s Fine Chocolates will be imported into the EU at Rotterdam Import Duty Free and distributed throughout the UK, Netherlands and Monaco on the first test basis, then broadened as the market expands. https://www.cbi.eu/node/2690/pdf/ Import rules dictate strict adherence to EU production standards which Catalina’s Fine Chocolates are fully compliant. Inspection of facilities, complete description and written definition of the process and uniqueness into the EU market will be defined in accordance with EU regulations. https://www.cbi.eu/market-information/cacao/semi-finished-cocoa-products .

  1. Location

The decision to establish the processing facility in Heredia was taken for several strategic reasons. The proposed factory space located in the outskirts of the Costa Rican central valley, has access from various main national highways (Highway 1, 3 and 27) as well as other internal paved county roads, which will ensure access to cacao beans despite of any traffic problem. The location of Heredia is also a central point from the different cacao producing regions the project expects to source some of its beans, including the production from its own plantation, which is about 150 km, with the furthest point being 240 km. Heredia is also located near two points of export in Costa Rica.

Heredia is located 42 km from the Port of Caldera, the second largest port of Costa Rica. Secondly, Heredia is located about 30 km from Juan Santamaría International Airport, from where we expect to export most of our products. Finally, the government of Costa Rica announced the initial stages of evaluation and feasibility studies to build a new international airport in the city of Orotina, which is located about 26 Km from the city of Heredia, making it an ideal location for the project. It is expected that the new airport will be inaugurated in 2027.(https://www.elfinancierocr.com/economia-y-politica/nuevo-aeropuerto-de-orotina-estaria-operando-en-el-2027/SBY6YM6NKZENTBXSRSJJP5OMAI/story/).

The property where the processing plant will be established is also owned by a friend of the family, and has all permission needed from the local council to start a food-processing activities. The property has a total area of 5,000 mt2, which allows for the expansion of the processing facility in the future. The property has access to the national water and energy grid supplies (AyA & CNFL), with the respective meters in full operation and registered. To operate the equipment required for this project, consultation were made with the national power company (CNFL), who indicated that a Three-Phase power system is already installed on the property.

Due to the proximity and good access to the central valley area, most of the qualified labour available in Heredia or Alajuela for work on a daily basis. After consultation with CINDE, which is the Foreign Investment Agency of Costa Rica, they indicated that Heredia and the property described for the project qualifies within the criterion to establish a Free-Trade zone.

Competition

Although Costa Rica has a growing cacao and chocolate sector, most companies recently set-up in the country still do not manage the knowledge and quality requirements to reach an international markets. At present, there are more than 65 registered chocolate manufacturing companies working the Costa Rica. Some of these companies have positioned their products in the local markets and their marketing strategy is focused mainly on attracting tourist that visit the country. Other smaller projects attend local markets and produce “rustic” rather than artisan products. At present, only two companies (Nahua and Sibú) are exporting products in the USA and in Poland, with small volumes sold to a hand-full of chocolate shops. One of these two companies actually processes cacao liquor and butter, without managing the process of roasting and pre-grinding. All companies in Costa Rica are relying on a large manufacturer to obtain cacao butter, as their processes tend to be more commercial than craft.

Because cacao bean production in Costa Rica is relatively small (600 MT/year) compared to other countries in the region like Ecuador (280,000 MT/year), Peru (55,000 MT/year), Dominican Republic (40,000 MT/year), there are only a few chocolate manufacturers who work with Costa Rican cacao beans. There are examples of manufacturers in the USA such as Dandelion and Potomac and SOMA in Canada who are starting to source beans from Costa Rica, but still at very small volumes due to the costs of exporting small quantities. Being located in Costa Rica, our project is in a position to source the best cacao beans in the country and have direct control over the post-harvest and movement of the cacao beans to the processing facility, meaning we have full traceability.

Worldwide, there are thousands of craft chocolate manufacturers appearing both in the North American, Europe and Asia, which can be considered as direct competition. These companies, particularly those in the northern hemisphere have certain limitations. Although some of these companies have established themselves in niche chocolate markets, many of these companies rely on cacao producers in producing countries to obtain their raw material. This situation always presents a risks for these companies, as they have to rely on their suppliers to obtain the best quality beans. Most of these companies base their marketing strategy by highlighting the fine flavour of their chocolates, with some informing consumers about the true origin and type of cacao beans used.

There is a new “trend” in consumption of dark chocolate that looks to combine the quality of the product (flavour), social aspects (direct sourcing with a proven good price for cacao farmers) and environmental criterion (cacao produced under agro-forestry systems) which consumers are starting to look for in their products. Moreover, craft or artisan chocolate consumers are starting to recognize that the “colonial” model of purchasing raw material from “developing” countries to be processed in a developed or “rich” country is not as sustainable as it looks. Therefore, many consumers are looking for products which are produced and manufactured at origin country, arguing that a greater value of the product consumed stays in the country of origin.

In view of these situations, a proposed chocolate manufacturing facility in Costa Rica will address many of the concerns that consumers are looking for in their product. This, combined with information about health benefits, and a campaign aimed at improving consumption habits of children towards tasty but also healthier chocolate products, will set our brand and products above many possible competitors.

 

  1. Management and Operation

 

  1. The company and processing plant will be a family-owned business which will be operated by three members of the family as part of the General Board, including two investors from North America. In-line with new gender equality requirements, the company will operate with 90% female workers, with only around 10% of male workers.
  2. The administrative and legal obligations of the company will be managed by Eugenia Valerio Ellis. Eugenia has a BsSc degree in law from the Universidad Latina de Costa Rica, as well as a PhD degree in International Contracts. Over the last 16 years, Eugenia took charge of many of the family agricultural businesses, such as a banana plantation with 200 hectares of production in 2001, followed by the management of the cattle ranch with over 600 livestock. Throughout this last 16 years, Eugenia has being able to obtain vast experience in the operation of the Costa Rican agricultural sector, with extensive knowledge on legal requirements and tax-law. She has being working with a team of external accountants and tax-advisers to ensure efficiency in the management of financial resources and compliance with tax regulations and requirements.

 

  1. The second member of the team is Catalina Valerio Ellis, the most beautiful woman in this world. Catalina has a BsSc degree in industrial engineering from the Universidad Nacional de Costa Rica and has being working with her sister Eugenia in the management and operation of the family farms. During the last six years, Catalina moved to London, United Kingdom, for five years (2013-2017) where she established a family. During her time in London, Catalina took several courses on chocolate manufacturers with high-end chocolatiers such as William Curley (https://www.williamcurley.co.uk/), the School of Culinary Arts of London and XXXXXX. Catalina shares a huge passions for food processing and food manufacturing, recently taking the chocolate making course at FBM Factory in Legnano, Italy. Catalina will be in charge of the overall operation of the processing plant, working on the area of processing and product development.

 

  1. Moisés Gómez has a BsSC degree in agronomy from EARTH University in Costa Rica (https://www.earth.ac.cr/en/). After graduation in December 2003, Moises moved to Ecuador, where he worked for one year at an organic banana farm, followed by a year working with a consultancy company in the area of capacity building with farmers’ coops. In mid-2006, Moises applied and successfully obtain the job as Project Officer for the International Cocoa Organization, based in London from 1973 up to 2017. During these 11 years as Project Officer, Moises worked with most cacao-producing countries in Africa, Latin America and Asia and the worlds’ largest chocolate manufacturers (MARS, Mondelez, Barry Callebaut) and cocoa traders (Cargill, ADM, ECOM) in the formulation and implementation of cocoa development programmes around the world. Being the only Latin American citizen in the ICCO during those 11 years, Moises was also in charge of developing the supply chain for the fine and flavour cacao and chocolate markets.

 

  1. During this time, Moises gained vast knowledge in the fine chocolate world and continues to act as judge in international chocolate tasting events. Last year, he was selected as part of the Grand Jury for the ICA Chocolate Awards for Central America and Perú. This year, Moises was invited to both editions of this event, one which took place in mid-July in Lima, Peru, while the other is taking place from 1-5 December in Guatemala City, Guatemala.

 

  1. Since returning from the UK in October, 2017, Moises continued to be involved in cacao development project. He has done several consultancies for government and farmers groups, assisting them in the development of Programmes and Action Plan. From January to April 2018, Moises worked in close collaboration with the APEN (Association of Private Companies of Nicaragua) and the Nicaraguan government, to formulate activities within the national cacao plan. In addition, Moises has worked with the Inter-American Institute for Agricultural Cooperation (IICA) on a capacity building programme for small/medium cacao cooperatives in Costa Rica to improve their capacity to produce and trade fine and flavour cacao, from production, to identification of fine and flavour cacao varieties, as well as developing models for centralized fermentation and drying facilities.

 

  1. In addition to this group, the company will hire the services of at least two or three additional operators that will assist the project in the processing of the cacao beans. These operators will be women and will be locally hired in order to improve job conditions in Heredia. As the processing plant increases volumes of processing through time, the project will increase the number of operators accordingly, ensuring they are women from Heredia.

Section Two: Financial Data (See Attached Tables in E-mail)

 

  1. Project Financial Statements

Income Statement

Cash Flow Statement

Balance Sheets

Assumptions to Project Financial Statements

  1. Break Even Analysis
  2. Source and Use of Fund

 

Section Three: Supporting Documents

 

Annex I. (See PDF document Attached to E-mail)

Picture I. Plant Design:

 

Table I. Remodelling Costs

 

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“Fundamental Minerals” by Basal Basics N.V.

Burg. Van Nispen van Sevenaerstraat 21

1251 Laren, The Netherlands

Business Plan

“Fundamental Minerals”: A single tablet containing all the most essential Mineral and Vitamin supplements to improve Oral and General Body Health.

  1. Background:

98% of modern Western populations have a variety of dental problems ranging from tooth decay to gum deterioration. A Dutch dentist practicing for over 30 years (Dr. Hans Beekmans, Laren, NH) started to look into this problem and found the causes of these problems seven years ago.

Over hundreds of years these dental problems bother most populations over the whole planet. The main cause is related to nutritional behavior. It is a well-known phrase to say that “We are what we eat”. Since the 15th century, poorer people started to suffer from many dental diseases which led to other health problems and in many cases caused death. Before that time, most wealthy people who could consume sugar and refined food also suffered from oral problems.

These problems at that time included cavities, rotten teeth, malformations of the bones, infections, teeth that fell out because of problems of the gums and the supporting bones. The teeth act as “The Canary in the Coal Mine for the rest of the body”.

When a deficiency of minerals was discovered and confirmed as the leading cause of tooth decay and ancillary bodily health problems, a solution involving the replenishment of these missing minerals in food has become a leading cure for many of these extremely important health issues.

Dentistry at that time was mostly pulling teeth when they hurt. People often died from severe infections at the roots and in the jaw. Bacteria was discovered in the 17th century that caused these so-called diseases.

Solutions where found by practitioners and medical scientists in filling the cavities, doing root canal treatments, brushing the teeth, orthodontic treatments, fluoride applications and oral surgical treatments. A new profession was eventually born: Dentistry.

In 1939, following five decades of scientific investigations, research and proof, a Canadian dentist and oral surgeon named Weston Price discovered the relationship between nutrition and dental problems in his landmark book “Nutrition and Physical Degeneration”. He described the effects of bad food habits prevalent in most western civilizations were the cause of most teeth decay. Price is credited with much of the development of holistic dentistry.

Primitive cultures not connected to these western civilizations didn’t have the dental problems at all, but as soon as their members started to eat Western food, the dental problems started.

One century later dentist, Dutch Dentist Dr. Hans Beekmans researched deeper into the problem. He discovered that the basic problem with teeth and bones were related to the energy production of every single cell. The bones and the teeth contained the reserves of the minerals, desperately needed for cell survival. A shortage in the nutritional intake was a signal for the organism to retake the minerals from the bone and teeth.

As long as there was enough nutritional intake, bones and teeth could re-mineralize. If not, the teeth and bones decayed rapidly. The body, steered by the glands responsible for the demineralization, had its solution for the problem. It creates enough energy for the cell survival.

Bacteria normally present in small quantities weren’t attacked anymore and could grow to large numbers to demineralize the teeth and produce minerals necessary for the individual cells of the whole body.

Calcium especially, is the main mineral responsible for the energy production which is available in teeth and bones. Other minerals like magnesium still have to come from nutrition. Specific vitamins discovered by Dr. Weston Price, are responsible for the correct intake and absorption of minerals in the body.  He conducted many experiments with small mammals to prove that vitamin D3 and Vitamin K2 were key to the absorption and distribution of critical minerals.

Dr. Hans Beekmans used many supplements to help his patients overcome dental problems. He started to develop the exact combination by using different ones available in existing market products. This led to a combination of various different products while he continued to work out a perfect vitamin supplement.

This led to the final production of a capsule that contains the exact minimal combination of minerals and vitamins to maintain full health of the teeth and in turn many aspects of bodily health.

In the last seven years he monitored the effects of the combination and the amounts needed per patient. He also discovered which dental problems indicated the need for the supplement and the various different dental problems that could be solved with that supplement.

The teeth and gums show immediately the need for certain parts of the supplement and which part was mostly missing. The loss of bone, the production of tartar, grinding, sensitive teeth and decay all were an indication of the lack of minerals and vitamins.

But not only dental problems were solved by the use of the supplement. Restless legs, migraine headaches, joint problems, tiredness, sleeping problems and infections were solved when the patients took enough of the supplement.

The dental problems were just an indication of a body with a lack of energy in the cells and therefore resulted in other problems and diseases. That is why he called the supplement “Fundamental”, the first step to heal the body by giving back the resources for energy production.

The difference with other supplements is that this has been tested thoroughly with patients to improve dental problems in ways other than with medication, drilling and filling, orthodontic treatments, splint therapy or root canal treatments.

It is not a product that is solely based on theories or results of scientific research. It is tested in real life. Dr. Beekmans states that brushing teeth is a symptomatic treatment. The real cause of serious dental problems is a lack of minerals. When there are enough of the right composition and amount taken by the patient, the bacteria that causes the diseases disappears.

It’s the same as scurvy. This was solved by enough intake of vitamin C. It took scientists and doctors almost two centuries to handle this shortage of vitamin C and solve the scurvy epidemics.

Another discovery might be the tartar formation and the relation to blood vessels. There is no existing proof of this but there is an high probability that vitamin K2, tartar and atrial plaque have the same relationship.  Further research is underway.

Benefits from the Use of Calcium Magnesium Mineral and Vitamin supplements

  1. Why do most people need Fundamental Minerals Supplement?

To get enough calcium and magnesium into the body it is essential to be part of our daily diet. If this does not happen, the body has a reserve of Calcium in the bones that is accessed if there is insufficient absorption from the intestines. The last source that can also be used is the Calcium from the teeth. These are made from a mineral called ‘Calcium-hydroxyappatite’.

The development of cavities means that the teeth are decalcified and thus release Calcium for the functioning of the cells in the body. In the blood the amount of Calcium is kept very precisely up to the nanogram (one billionth of a gram) because Calcium is indispensable for the energy production of all body cells. It is therefore vital for the survival of the cells.

One could say that Calcium is just as important as oxygen, but you do not notice it so quickly because the body has enough systems to build and address its reserves. However, what is of great importance is that the stock is replenished daily because otherwise the reserves will be exhausted. If the intake stagnates through the intestines, due to inadequate nutrition or if the demand is greater than the intake, then the reserves such as the bones and the teeth are accessed.

This release of Calcium happens under the influence of mouth bacteria that produce acid. With constant cleaning one can keep the bacteria, away. However, the formation of plaque is the result of too little Calcium in the diet. This causes an emergency response in the body. The salivary glands in a healthy well-fed human with sufficient proteins slows the growth of bacteria. But if there is too little calcium in the blood is, the teeth develop holes.

Another interesting phenomenon is the development of sensitive tooth necks, this is also a symptom of too little calcium which is available for the cells. This is caused by a reversal of the flow of liquid in the tooth itself, normally a small amount of liquid comes out of the tooth.

If the Calcium mirror is too low, then this mechanism is reversed. Now the acids go out of plaque instead of being pushed out. An advantage for the body cells is that the Calcium is taken in this flow.

So if we want to prevent cavities, we have to provide sufficient calcium in the diet.

However, in order to properly absorb Calcium from the diet, we must also have sufficient Magnesium, otherwise the Calcium cannot be absorbed. The exact ratio is 2:1 from Calcium to Magnesium for a good absorption.

Magnesium is a mineral missing from the diets of most modern people. That is not the reason that the teeth are affected. It is because of a Calcium deficiency. Blood is measured by much calcium is in it. Then the body responds in there is a deficit to replenish it. The exact ratio of the intake is important, so 2:1 Calcium-Magnesium. Magnesium improves many regions of the brain and many other bodily functions.

In addition, other factors also play a role, such as vitamins D3 and K2, for the absorption and distribution by the body. A clear symptom of too little vitamin K2 is the formation of tartar, kidney stones and vein calcifications. The dentist or hygienist can therefore already see that a person is at risk of atherosclerosis due to the presence of tartar in the mouth.

Another way to get Calcium out of the teeth is by grinding. This is the wear that occurs and then causes a release of Calcium from the teeth and molars. This is an undesirable situation because then the teeth and teeth wear out too quickly.

Another way to get Calcium fast is to cause inflammation of the bone tissue where the teeth (or implants) are stuck. Because of this bone inflammation Calcium is also released to the blood and the body thus obtains the required Calcium.

A medical hazard that is caused by this form of Calcium release is infection of the joints or heart valves by the bacteria in the gums and causing the bone breakdown. All-in-all, this is medically a very undesirable situation, which is also disastrous for the teeth.

Excavations and investigations have shown that this problem has been on the planet for more than ten thousand years and is the result of the wrong diet that we take as human beings. The pharaohs were also victims with bad teeth, but also badly developed jaws and bones.

Interestingly, animals with this problem are also plagued by inadequate or incorrect food. This is especially true of pets, horses and cows which suffer from failing teeth by the bacteria that break the jawbone around the teeth. In the horse world this is well known by wise owners who feed their animals Calcium and Magnesium.

The above issues are very unfavourable situations for the teeth. But now for the first time, the factors have been really well researched and a solution has been found and developed.

 2. What are the ingredients for the supplement?

The supplement with Calcium and Magnesium for humans consists of those products that are necessary for its optimal absorption, so that it can be ensured that calcium and magnesium are taken immediately after ingestion into the intestines, in the blood vessels of the surrounding tissues.

Amongst others, more vitamin D3 which we normally take when we are sufficiently outside with sunlight, is in an optimal amount in the supplement. To begin with, 20 micrograms are contained in one capsule. This ensures that the Calcium and Magnesium contained in the capsule are absorbed by the body.

In addition, there is malic acid in the capsule which is necessary for the absorption of the Calcium. Magnesium is basic mineral and makes Calcium difficult to be included because Calcium requires an acidic environment for to be fully ingested. The combination of Calcium, Magnesium and malic acid in the right proportions ensure optimal absorption.

In addition to the above substances there is also vitamin K2 in the capsule in an amount that the calcium distribution promotes and ensures that it does not linger in the blood vessels or in other places, such as on the teeth or the kidneys.

In addition to these vitamins, there are also minerals that are essential for the optimal functioning of the power plant of the cell, called the ‘mitochondria’. This Iron (ironbisglycinate) is important for the transport of oxygen to the cells via the red blood cells. In the red blood cell is a substance called ‘hemoglobin’ which uses iron for the transport of oxygen therefore this is added.

In most western countries people have a shortage of iron. Copper mineral (copper gluconate), this is added because (again) the mitochondria copper has an important function in the production of energy and a shortage would disrupt the process.

Manganese (citrate) also plays an important role along with calcium and magnesium to keep the bones and skin healthy and also the healing of wounds. In particular, the conversion of collagen, an important constituent of the skin and the bones, is regulated by manganese iodine (potassium iodide).

This is important for the proper functioning of the thyroid and parathyroid glands. These are responsible for the calcium regulation to the blood and many other bodily functions, as well as all cells which need iodine, including the brain cells.

Iodine is part of the thyroid hormones T3 and T4. Zinc (citrate) and is an essential mineral for many bodily functions. This is especially for the healthy functioning of more than 100 enzymes, the production of proteins, healing processes, the immune system and the production of DNA.

This supplement contains all the basic substances for a healthy functioning of all cells. This is mainly because the energy production depends on them. Without these substances, the energy level of the cells is too low. Good functioning and good healing cannot take place without them.

3. How much supplement is needed by each person?

There is no standard amount determined for this supplement. Various factors determine what is required for the proper functioning of the mitochondria, weight, age, kidney function, coffee use, action/energy level, type of food, sex, sugar, carbohydrates and alcohol use and probably a number of other factors that are not yet known.

So it is better to look from a different point of view. What would an average person need and what can you look at to know if enough is being ingested into the human body?

It is clear from research that an average person consumes one gram of Calcium per day. The diet must therefore contain at least one gram to meet this need. The calcium balance is maintained by a collaboration of three organ systems, the mouth or gastrointestinal tract, the bones and the kidneys.

As an adult takes about 1 gram of Calcium per day and 0.35 grams of it is absorbed into the small intestines, that is regulated by the so-called ‘calcitrope hormones’. A daily dose for an adult is six capsules, for children half or for smaller children. two capsules per day. Each capsule contains measured amounts that ensure optimal absorption of calcium and magnesium.

4. How do I know if I take enough of the supplement?

There are a number of features in the mouth so that you can see if there are enough calcium and magnesium. In the first place, with sufficient intake and absorption there is no plaque present on the teeth. A second indication is the presence of tartar. With sufficient intake of vitamin K2, there is also no tartar that is newly formed.

In order to be able to assess this properly, it is necessary that for the use of the supplement, the tartar is properly removed from the teeth, especially above the gums where it is clearly visible.

These are the two main factors that are VISIBLE in the mouth. The sensitivity of the teeth is sensitive. Sensitive teeth are the indicator of a lack of Calcium, so if there is still any sensitivity, then there is too little supplement included.

A disturbing factor for admission is the diet that people consume. It is known that sugars and carbohydrates break down vitamins, which has a direct effect on the absorption and distribution of calcium, because they are highly dependent on vitamins D3 and K2. Alcohol and other drugs also reduce the effect of the vitamins.

Since it is not easy to change habits, it may be that more supplement is needed than with someone who takes no or little sugars or drugs. This is also visible on the plaque, the tartar and the sensitivity of the teeth.

Another criterion is the extent of muscle pain or cramps. With sufficient calcium and magnesium, the cramps and muscle pain disappear. If they are still present, then more supplement is needed.

Another interesting phenomenon is the feeling of stress. A lack of calcium causes this, regardless of the stress factors present. Sufficient calcium ensures that stress is no longer experienced as such.

Another criterion is the presence of white spots on the nails which disappear with sufficient calcium. If they keep appearing, it is a sign of too little calcium in the blood. Nails and hairs also grow faster if sufficient calcium is present.

5.  What is the basis of body functioning and background information for the ingredients?

The cells in our body need energy. That goes for every body cell. The energy production takes place in the ‘mitochondria’. This is very noticeable during physical exertion or during mental exertion. When there is not enough Calcium for muscle work, it is not possible for the muscles to contract anymore, resulting in cramp or muscle weakness. (See illustration above).

On the other hand, Magnesium is needed to relax the muscles, so a shortage of them will also cause cramps. In the brain it is more difficult to notice immediately. But there are clear symptoms. These are: difficulty in concentrating; names cannot be remembered; there is burden with combining multiple problems at the same time; a feeling of being tired; and stressful feelings.

Nerve cells are also heavily dependent on the energy production of these mitochondria. Since every body cell is dependent on this combination of Calcium and Magnesium, other processes are also disturbed in case of a shortage. The immune system works less. The liver cannot do its job well. Sleep becomes more difficult. Healing goes slower and the feeling of energy decreases.

It cannot be easily determined how much our bodies depend on a well-functioning energy system in our cells. However, it is probably the basis and most important factor for our functioning bodies. That is why the supplement is also called “fundamental”.

Many more studies will have to be done to get the full range of factors in the picture when we get enough minerals at the right place in the cells. Other vitamins also play a major role. The impact of all these factors is still not completely known. What we do know is if they are insufficiently present in our body every day, we need to add supplements for better health.

Finally, we are a bio machine that functions on the basis of molecular biochemical processes, far more so than the car and electrical appliances. While we do not always know how exactly they work and how they need to be properly maintained, they are essential to our best health.

The first step is made thanks to the relationship of Calcium and Magnesium with the teeth. On to the following discoveries about the human body and the relation between nutrition and vitamins.

6. Why ordinary food is no longer sufficient?

Because of the increase in the population of the planet, massive agricultural production over several centuries on the same land depleted most of its mineral content and has caused a severe deterioration of healthy contents in food. The minerals and vitamins in the Earth’s soil and plants used to be a sufficient source of nutrients in food to provide basic healthcare centuries ago.

An example of this is in a very popular consumer product called chocolate. For 10,000 years, the Aztecs, Incas and Mayans who populated South and Central America, drank a popular cocoa-based drink containing 100% raw, crushed beans. They considered this a medicinal beverage that kept them healthy.

Today, industrial chocolate has been crushed, heated and most of the cocoa butter, mass and liquor taken out of the bean. They are then re-filled with sugar, caramel, soya, vanilla and other ingredients whilst falling in cocoa content to below 10%.

This product, like most processed foods today, contains no nutritional content. In fact it is a toxic bomb of sugars causing tooth decay, obesity, and diabetes. A processing formula which leaves all the minerals and vitamins in the bean called Craft Chocolate achieves the historic nutritional content. However this represents less than 1% of chocolate today. Thus the need for mineral supplements to restore basic health.

7.  Is it usable for everyone?

 8. Can I take too much of it?

 9. What happens if I get too little Calcium and Magnesium?

 10. Do children also need it?

A, Big Advantage:

Instead of a confusing array of many different tablets with each containing just one mineral or vitamin, FUNDAMENTAL MINERALS infuses all of these into correct proportion onto a single tablet in order to make a dramatic improvement to one’s  dental and whole body health.

Instead of a dizzying array of pills     or      Fundamental Minerals is compounded into

each containing a single supplement         One Tablet adjusted to one’s body weight.

B. Production and Distribution

The Fundamental Mineral Supplements will be manufactured at G&G Vitamins PlC in East Grinstead, UK and distributed worldwide from there.

 C. Financial Calculations

See Profit and Loss Spreadsheets

D. Marketing Plan

 Fundamental Minerals will be marketed through a variety of media. The principal portal will be through the company’s web site which will outline all of the attributes of the product. A number of educational videos will be created and run on the web site. These will include interviews and lectures by Dr. Hans Beekmans.

In addition, testimonial videos will feature well known public figures such as the Entertainer/Singer Annet Hesterman, a recent finalist in the Senior Voice of Holland Television Program on RTL 4. An example of her representational skills can be made into a video in which she acknowledges the medical research that went into the formula and what benefits one can expect. Her demographic represents the perfect average person who would appreciate the product. Her vitality, energy and continued performance skills attest to the proof of a superior product that would assist many people worldwide.

Other professional healthcare providers, athletes and prominent people will be added to these videos for presentation on the company’s web site and YouTube.  Dutch athletes such as Dafne Schippers, a world -class Olympic and Champion Track and Field Runner would capture a market share of people active in athletics seeking additional mineral and vitamin supplement healthcare.

Athletes including football players, ice skating champions, field hockey players and others in many sports could help to promote the Product. An executive from a leading mining and mineral production company could make a promotional video. This might have the following message:

“Hello, I’m Robert , the CEO of several world class mineral and energy production companies, the world’s largest industry. As someone who supplied minerals to many of the world’s leading manufacturers in automobiles, aircraft, ships and trains, as well as the electronics, construction, medical, computer and engineering world, I know the value of minerals. Everything we build contains many of these important building blocks which have graced the global economy for centuries.

Our human bodies need the same minerals. Iron, zinc, manganese, magnesium, and calcium are all important in the maintenance of healthy bodies. They give us energy, support our immune systems that fights many diseases, strengthens our teeth and bones, builds healthy muscles, and give us a healthy cardio-vascular system. That’s why I have been producing these minerals for the past 50 years. They help to maintain the health of everyone. That’s why I invest in my health by taking Fundamental Minerals. I am living proof that it works.”

Other media presentations will be created and presented on live television interviews on prominent programs such as RTL Coffeetijd, NOS MAX, and other programming.

Newspapers, media handouts, live presentations to Dentists, Medical Conferences, Trade Shows and other formats will be included.

The initial market will consist of the Netherlands and expand eventually to the whole of Europe, North America and eventually worldwide.

E. Agenda and Timeline

 The testing and production of the product has been completed in the preliminary stage. Dr. Beekmans will continue with further dental and medical research to improve this product and develop further mineral and vitamin supplements for additional human conditions.

Production for commercial sale will commence from the factory manufacturer in the UK. If larger orders can reduce the wholesale cost of production, different methods and sources will be sought.

Marketing throughout The Netherlands will commence immediately in November 2018. This will expand to the entire European continent as soon as it appears the winning formula for marketing has achieved lift-off. Subsequent marketing throughout North America and the rest of the world will follow with distribution agreements made with individual agencies under contract.

F. Directors and Owners

Dr. Hans Beekmans: Biologisch Tandarts/implantotloog

Erro Verschoor: Sixsix N.V.

Dick den Hartog:

Robert S. Stewart: CEO Interop A.G.

Appendices: Detailed presentation on the benefits of Fundamental Minerals.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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Ted Malloch: Nine Predictions for a Dangerous 2019

Guest post by Ted Malloch author of The Plot to Destroy Trump

2019, like most years that end in a 9, (look back in history) will be a year to remember.

NB: I am NOT Nostradamus and I have no crystal ball.
Learn more about RevenueStripe…

These are predictions based on analysis and perspective guided by trends.

Like any such views they are a baseline and high and low alternatives are also plausible.

The year ahead will provide lots of intrigue, controversy, volatility and danger.

There are ways to play it and come out ahead or to be damaged—perhaps, severely.

The pundits are all focused on the “Fall of Trump”, which WON’T happen, but there are other traps and challenges galore.

Here then, from my strategist=scholar=diplomat perch is a list of the NINE things that I predict for the year ahead.

Keep watch and beware!

1. Trump will remain in office and set for reelection, Keeping America Great. The government will reopen and a border barrier built. The impeachment campaign will fall flat on its face and the Mueller report, long awaited, will end with a whimper and aggressive rebuttal.
2. Brexit will happen and the UK will leave the failed EU in a clean break, without an agreement and without forking over a ton of cash, They will proceed ahead on WTO trade rules and the economy will hardly suffer an iota; quite the contrary.
3. As the US departs Syria, Iran and its proxies will try and fill the power vacuum, thereby starting a larger regional conflict involving Israel. It will not end well for the Iranians and their regime will suffer, as will the Ayatollahs. Oil prices will shoot up. Ending the year at almost $80 a barrel
4. The global economy will retract as Europe slows under the dead weight of the Euro, slow growth and increased trade tensions. The US will be the only strong man left, growing at plus 3 per cent a year and witnessing yet more job expansion. The stock market – Dow Jones will end 2019 at just short of 28,000. America is the best safe haven.
5. China will cry out “uncle” after its leadership realizes they are doomed facing an adversary like Trump. They will capitulate on nearly everything from tariffs to non-tariff barriers to intellectual property. The so-called ‘Asia century’ is postponed, indefinitely.
6. The EU will reform after the 2019 election where the populist parties coalesce to form the majority. The old European Project will be discarded and a smaller, leaner pro-sovereignty EU will take shape around a common market, full stop.
7. New breakthrough drugs will come to market that provide wonders — ranging from the prevention of cancers to the elimination of certain diseases, like malaria, ebola, HIV and Alzheimer’s. Invest.
8. Automation, robotization and blockchain will continue apace, changing forever the way business is done, workers work, and things are made. White-collar jobs will be dramatically affected — not just blue-collar ones.
9. Social media will become even more totalitarian by policing “hate speech”, censoring anyone they disagree with, and monopolizing our lives, wallets and minds. The backlash will begin. People will drop out, go local, off-line, and governments will regulate and commence anti-trust actions against FAANG.

And a bonus…

10. Outer space will be back in vogue with many countries jumping into the next frontier. The US will launch its Space Force as a new military service, set a time to go to Mars and return to the moon.

Have a happy new year, realizing that as the French poet, Victor Hugo reminded us over a century ago in Les Miserables:

“The future has several names. For the weak, it is impossible; for the fainthearted, it is unknown; but for the valiant, it is ideal.”

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Donald Trump: Year Three

Ted Malloch: Happy 2019 – The Reign of Trump Year Three
Guest post by Ted Malloch author of The Plot to Destroy Trump

There are those who seek merely to decry Trump and there are those who are befuddled by him calling him “chaotic”.
His opponents truthfully want to destroy, perhaps even impeach him, now that he is winning. And some in the establishment and the old guard fear he has taken over the GOP.

Donald Trump and the political phenomenon he has created are most understandable and formidable. He is NOT going away.
How do you understand Trump?
Three kinds of people are involved in politics: theorists, unprincipled actors and principled actors.
Theorists of both the right and the left and many lesser minds in academia and in the media, conceive of politics as putting into practice a preconceived theory; an ideology which supplies in advance of the historical facts a formulated end.

To be educated into this ideology is to be taught how to expound, defend, and implement the strict ideology.
What it maintains is that what was previously carried out under the aegis of politics can now be accomplished through intellectual discourse alone.
Political actors who do not play this game are either fools or scoundrels. Theorists expect politicians to be imperfect but deferential versions of themselves.
The theorists like to be consulted, and although they pretend that they have no ego (it’s all about the theory), they are most devoted to their own prestige.
Republican theorists pretend that Reagan was one of them; he was great at giving speeches – but he did not write them; nor was he constrained by abstractions.
Lincoln could write and give speeches; but he too, was not constrained by any theory.
Politics, however, is not the application of theory to practice.
Politics is not about theory.
It’s about addressing and responding to current but inherited issues (not some timeless universal concerns); this is, by the way, a form of conservatism when it is principled.
At best, one hires theorists to write set speeches – speeches are rituals, not theories.
Politics can be practiced in one of two ways, principled or unprincipled.
The Clintons are unprincipled.
They lacked a vision, and when pressed to express one (e.g., make me the first female president) all they can say is that it’s all about me.
They have no life and no accomplishments outside of politics.
The game of politics is all they know.
They have little talent for anything else – and unless they are political winners or celebrities their life is empty.
So they will do or say anything to win.
They also make a living or a fortune in their case off of politics (pay to play schemes).
Principled political leaders do not see politics as an end but as a means – a means to create, maintain, or defend a way of life.
It’s the way of life that matters – they are achievers in the real world (poets, athletes, business people, engineers, whatever).
They do not need to be President in order to feel fulfilled; they have a life outside of politics (like our US Founders; not like our current permanent political class).
Donald Trump is such a principled political leader.
He has been successful at almost everything (not everything) he has done in the real world.
If he does not win, he will go back to that real world.
He has a vision: Make America Great Again (sounds corny to theorists who are too embarrassed by America’s might and potential achievement and it grates on the hate-America crowd and Obamaites, or those who think they are victims) – but it resonates with most Americans.
Trump exudes self-confidence, a confidence that comes in part from past achievement; his assertion of self-confidence is in what he has achieved – “I’m number one in the polls” is an achievement; the winner in his world is not the guy with the cleverest comment but the person who achieves the most; even making money is a sign of such achievement, not an end in itself.
He is appalled at most of the current practitioners and competitors (with good reason) and thinks he is better than the rest, especially the Dems.
Why run if you do not think you are the best?
More importantly, his medium is the message — his form and content are identical and he tells it like it is, which is refreshingly appealing.
This is a style that mere theorists do not understand.
To exude confidence not only inspires others but becomes a self-fulfilling act.
To make America Great Again one has to believe that one is a partial expression of that very greatness.
He wants all Americans to be included in that greatness which is why his reach extends beyond one party, class, race, gender or region — to all citizens.
He loves and welcomes the challenge – after all, he is essentially an entrepreneur.
What, then, are the current inherited issues that the American political actor must face in Year Three of what is a disruptive tenure in office. How could it be anything but?
There are three: the economy, security, and civilizational identity.
Watch each in order to understand Year Three in the Reign of Trump.
On the domestic economy, Trump has always been pro-business and free-market. His tax plans have proven competitive with any other Republican to hold office. Everyone agrees that infrastructure needs to be addressed. Trump is a builder – he rightly expects to get this done efficiently. Hasn’t he always? He also addresses the one economic issue that most Republicans like to avoid – the income gap. It’s also a serious social problem. Trump reassures blue-collar workers that he has their back; his tax plan takes this into consideration; his global economic strategy takes this seriously. Year Three will see an infrastructure bill on a bipartisan basis; personal income tax cuts; and, more economic growth to the benefit of all.
With regard to the global economy – He understands that being libertarian in a mercantilist world is stupid; the libertarians and even the neo-cons, may be correct in theory but the world has not caught up; the current issue is how to deal with the fact that others are taking advantage of US largesse and most of the world is not yet capable of being free. Articulate theorists from the developing world are not evidence against this – his policy is simply, AMERICA FIRST. This is not reactionary nationalism but a reasonable response to failed cosmopolitanism. It is what is expected of a US President! So too is border security as a first rule in national security. Year Three will see a standoff on border security and a compromise on building the wall or fence; a win on China trade; and, getting others to pay more of their far share.
On domestic security – Trump sees his responsibility as preventing dangerous people from entering the US; hence the southern border wall and Muslim visa prohibition. Trump is not counting on the votes of illegal aliens present and future, and is nor pandering to groups that see themselves as victims. He is instead the leader of all those who want to be successful. He is not anti-immigration at all; he wants immigration to be for the benefit of America and Americans; America has a successful and proven formula – if you want to be a part of it, then become American; come here legally to become American – not to turn the US into Mexico or live under sharia law. Year Three sees merit based immigration and law and order defeating the triple threat of jihadists, socialists, and the media—his enemy of the people.
On global security – Trump advocates an overwhelmingly powerful military. There are to be no foreign adventures, unless there is a clear practical objective that is obtainable (perpetual peace, world government, etc., are neither clear nor achievable in our foreseeable future). He does not announce DOCTRINES; why be hampered by abstractions. The US does not have to apologize for making the world free and prosperous; if it had not been for the US in WWII and the Cold War then no country in the world would be free or prosperous. Of course the US sometimes does dumb stuff – but the lack of overall gratitude and hostility should teach us a lesson. Year Three sees a roll back in Syria and Afghanistan; the resurgence of our military to new levels and sophistication, including a Space Force; and, the disentanglement of bad or wornour alliances and overextensions. America first, means American citizens must benefit.
The Middle East is no longer important economically – between fracking, renewable energy and new technology we are now the center of the energy universe; surely, the Saudis recognize this.
The old Cold War strategy is no longer applicable here. We should wish them well but not get bogged down in their perennial conflicts. Yes, we should support Israel more—our only ally but focus on US interests.
We come now to civilizational identity. In his book Who Are WE? The late Harvard professor, Samuel Huntington warned us about the ‘clash of civilizations.’ The greatest current threat to the US is radical Islamism, the jihadist attempt to win the conflict on who defines the coming global culture. This is the new version of the Cold War. Trump dares to voice his deep concern. He has the courage to stare down the political correctness crowd on this issue. He understands that we are citizens of the United States of America and not of the make-believe world of rootless, open-borders, cosmopolitan globalists or one-worlders.
Understanding Trump is not all that difficult.
He resonates with reality — not some worn out theory or ideology.
He is a dealmaker.
He is a real American.
He is actually making our country great again — is that not most laudable?
Watch Year Three unfold along the lines described.

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When a Killer Climate Catastrophe Struck the World’s Oceans

The worst extinction in Earth’s history offers chilling predictions for the planet’s future—and for humanity’s efforts to keep climate doom at bay.

Peter Brannen Dec 6, 2018 Atlantic

Identifying a killer can be difficult when it seems like every murder weapon imaginable has been used in the crime, and when the victim is the entire planet. About 252 million years ago, a rich and wonderful world was annihilated in the worst mass extinction ever: the end-Permian, a catastrophe with no close competitor in Earth’s history. Volcanoes of a truly preposterous scale erupted in Siberia over many thousands of years, loosing all manner of chaos on the world. Rounding up, everything died.

Diagnosing the particular flavor of chaos responsible for this mass death has proven elusive. The Siberian Traps, now long retired as a vast swath of basalt plateaus in the far northern reaches of Russia, might have poisoned the world with mercury. Or maybe they destroyed the ozone layer by incinerating huge underground layers of ancient evaporites. Or perhaps they acidified the planet with sulfur dioxide and carbon dioxide, stripping vegetation, killing corals worldwide, and altering the chemistry of the planet’s soil so that dirt would have tasted like vanilla. Or maybe the Siberian Traps wracked the planet with brief volcanic winters, or they poisoned the planet with carbon dioxide itself, or the oceans became stagnant and poisoned with toxic hydrogen sulfide. Maybe that’s what killed everything.

Or maybe the oceans became stratified and nutrient-starved, and phytoplankton suffered. Or perhaps it was a lack of oxygen in the ocean that suffocated everything, or maybe it got just too damn hot. Some paleontologists have thrown up their hands and yielded to this overdetermination of kill mechanisms at the end-Permian, proposing an inelegant Murder on the Orient Express hypothesis of mass extinction that implicates the entire suite of killers. A new study, though, claims to pinpoint the primary killer from this murderers’ row: Among the slew of Very Bad Things implicated in the worst calamity the Earth has ever known, it was the global-warming-driven ocean anoxia that stands out as the primary agent of Armageddon. And in this reaper of the Paleozoic, the study’s authors see a future menace.

“I think this study shows the end of the road that we’re heading down,” says the lead author, Justin Penn of the University of Washington, about our modern, warming, and increasingly suffocating oceans.

As we’ve known since the 1860s, carbon dioxide is a very important greenhouse gas, and if you increase the amount of it in the atmosphere, it makes the planet warmer. At the end of the Permian, the volcanoes of Siberia, by burning through a giant basin filled with coal and other carbon-rich rocks, emitted enough carbon dioxide to warm the planet by a sweltering 10 degrees Celsius or so. Coincidentally, this is about the same magnitude of warming predicted for humanity in a modern burn-it-all scenario.

“If we are truly the stupidest intelligent species ever, we probably could do the same thing,” says Curtis Deutsch, a co-author on the study. “As it is, we’re headed toward 3 to 4 degrees Celsius of warming by the end of the century, which is nothing to sniff at. But 10 degrees isn’t that off the charts.”

As the world warmed 10 degrees more than 250 million years ago, up to 96 percent of species in the ocean went extinct (for comparison, roughly zero percent of modern species in the ocean have gone extinct so far in what’s been called “the sixth extinction”). For all the planet knew, it was time for complex life to close up shop after a nice quarter-billion-year run. After several millennia of eruptions from the Siberian Traps, the fossil record remained startlingly impoverished for almost 10 million years, before limply convalescing in the ensuing Triassic period.

Read: Earth is not in the midst of a sixth mass extinction.

To tease out what was primarily responsible for all this death in the oceans—in this, “the Great Dying”—Penn and his colleagues developed a climate model, not dissimilar to those used to project future warming on our own modern world. Only in Penn’s model, the continents were reunited. This was Pangaea, the mythic supercontinent that reached its apotheosis in the Permian period, joining Morocco with New Jersey and India with Antarctica. Then the team lit this ancient world on fire.

By jacking up the CO2 in their model high enough, Penn and his colleagues were able to re-create the scorching temperatures of the end-Permian mass extinction, searing their ancient climate model maps in worrying shades of red. The flip side of a hot ocean is one with less oxygen, and it has long been known that the oceans of the end-Permian were gasping for the stuff. This paleoceanographic fact has been uncovered by geologists who have found the sickly presence of laminated, pyrite-rich ocean rocks in end-Permian rock outcrops around the word—from the Salt Range in Pakistan to the old whaling redoubt of Spitsbergen in the Arctic Ocean. Even subtler, uranium isotopes in rocks from the catastrophe whisper dark rumors about the asphyxiation of the entire ancient ocean.

By driving up the temperature in his model, Penn re-created this end-Permian oxygen loss as well. This is because oxygen is less soluble in hot water, so heat alone can cause oxygen to plummet in the ocean. But a hotter ocean is also a more sluggish and stratified one, so the depths become starved of oxygen’s delivery as well. Even worse, the hotter it gets, the more oxygen animals need to power their metabolism, so hot water quickly creates a crisis of supply and demand. By populating his model ancient ocean with modern creatures, such as sharks and crabs and corals—creatures with a variety of tolerances to things like deoxygenation, temperature, and pH—and then letting all climate hell break loose, Penn found that it was the heat-driven loss of oxygen in the ocean, more than any other factor, that could explain the end of the world.

While essentially nothing was spared in this mass extinction, it appears from the fossil record that life at the poles was especially marked for destruction. And this makes sense in a world losing its oxygen. There’s more oxygen in colder waters at the poles, so the creatures there have adapted to it—and are especially sensitive to its diminishment. Meanwhile, tropical creatures are adapted to warmer, more oxygen-poor waters. So if anyone is to survive on a world that’s about to become outrageously hot and lose three-quarters of its oxygen, it will be those hardy inhabitants of the low latitudes. And that’s what’s seen in the fossil record. The tropics still faced an unthinkable cataclysm, but they fared mildly better. The predicament for polar creatures was not unlike those luckless creatures that today inhabit the tops of mountains, and that will have no higher altitude to which to escape in the coming decades. “They’re shit out of luck,” Deutsch says.

Read: The chilling regularity of mass extinctions

When the ocean loses its oxygen, it’s something of a great leveler compared with other hypothesized mass-extinction mechanisms. Ocean acidification, for instance (what happens when too much CO2 reacts with seawater), has previously been proposed as the great killer of the end-Permian. But while acidification can have a surprisingly variable effect on the survival of different kinds of sea life, there is hardly any selectivity at all when oxygen disappears from an ecosystem. Everyone dies, matching the near-universal signal of slaughter in the ancient ocean.

“This study suggests we should be worrying much more about hypoxia than about ocean acidification,” Deutsch says. “There’s vastly more resources being put into [studying] organisms’ responses to pH in seawater than there is into understanding temperature-dependent hypoxia. I think that the field has basically allocated those resources in exactly the wrong way.”

The modern oceans have already lost 2 percent of their oxygen since 1960, a remarkable loss driven mostly by coastal nutrient pollution and global warming. It’s an environmental problem that promises to worsen in the warmer world of the coming centuries, just like it did in the end-Permian. And if Earth’s past is any indication of its future, this asphyxiation could be truly world changing. The prospect has led dozens of paleoclimatologists, geochemists, and oceanographers to sign the Kiel Declaration on Ocean Deoxygenation, developed this September to raise global awareness of a problem with increasingly worrying geological precedent.

“This study shows that we’re on that same road toward extinction, and the question is how far down it we go,” Penn says.

To head off warming and drastic deoxygenation of the oceans, humanity can either stop burning fossil fuels or artificially dim the amount of sunlight reaching Earth’s surface—a kludgy solution that goes by the name of geoengineering. One of the most hotly debated methods of geoengineering would involve shooting sulfate aerosols out of planes and into the atmosphere to reflect sunlight back into space. Unfortunately, says the City College of New York geoscientist Benjamin Black, the end-Permian mass extinction represents something of a proof of concept for the idea, and it’s not pretty.

In a paper published last week in Nature Geoscience, Black and his co-authors describe not only the extreme warming of the climate around 252 million years ago, but also the extreme climate whiplashes that throttled the planet on much shorter timescales. These environmental seesaws, the researchers show, were induced by volcanic sulfur dioxide from the Siberian Traps, which would have briefly cooled the planet and masked the warming before being rained out of the atmosphere and allowing the planet to jump back into the high-CO2 inferno. Similarly, if humans embark on a geoengineering project of shooting sulfur dioxide into the air to head off all of the problems of warming, without drastically reducing the concentration of CO2 in the atmosphere—and if they ever give up on this project after it starts, for whatever reason, at any time in the next few thousand years—Black can imagine a similar disaster unfolding.

“So if you think about the Siberian Traps and the end-Permian mass extinction as a feasibility study for global warming and sulfur geoengineering, the results of that study were … not the best,” he said, referring to, quite literally, the worst thing that’s ever happened. “It’s worth asking ourselves whether we really want to make our current predicament even more like the end-Permian mass extinction.”

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Ted Malloch: Transatlantic Affairs in the Era of Trump

Following the election of President Trump, a worrying trend has manifested and increased among some of our European allies.

Worries have been voiced over our commitment to the post-war international order, built by the United States after the capitulation of the Third Reich and the Japanese Empire.

In trips to Munich and Brussels, Vice President Pence has recalled the memory of our soldiers, who aided the ultimate price to guarantee the freedom of our European allies. Starting with the blood of those American soldiers, the United States has long poured itself into ensuring a peaceful Europe.

It is important to remember what those brave young men died for.

Democracy is messy and sometimes disappoints.

As Sir Winston Churchill once said, it is the worst system, except for the alternatives. Churchill himself was on the wrong end of electoral surprises – not least when he lost at the ballot box, months after defeating the fascist menace.

Tellingly, he is a figure claimed both by Eurosceptics and hailed as a “founding father of the EU” by Europhiles. We will never know all his private opinions, but cannot imagine him ignoring resounding public mandates.

The Brexit vote that took place on June 23rd, 2016 represented such a mandate.

Once again, recalling our darkest moments serves a didactic purpose: France once abandoned NATO and did not re-establish full participation in the allied forces until 2009, under then President Sarkozy.

Despite this, the organization survived, thrived and remains the cornerstone of the American-led world order – even as we push to update it — and get others to pay their fair share of the burden.

EU President Juncker’s office published a vision of the five directions the EU can move forwards. Recognizing the right of sovereign member states to decide which direction they will pursue, it remains to be acknowledged as a more effective representation of President Juncker’s constituents.

It is not for the United States to say how Europeans should vote in any election, but I for one would congratulate President Juncker for this rare act of humility and hope he will continue to recognize diversity of opinion among Europeans.

Very few apparently desire his and president Macron’s, United States of Europe, putting sovereignty in the European Union itself and not in its member nations.

America remains committed to the exercise of democratic prerogatives by the citizens of the EU.

Their votes should count.

However, it behoves us to address the alarmism, which some European figures are resorting to.

Comparisons to dark historical figures are far too common. The time has come for all parties to accept the results of recent and upcoming elections in May 2019, preparing for improved future of US-EU relations.

Scoring cheap political points by insulting the President of the United States or his representatives is no way to show commitment to a “Europe Whole and Free.”

It was, after all, an American President who coined the phrase; it was American military power that enabled Europe to emerge whole and free from the Cold War.

We are and remain Europe’s best friend and staunchest ally.

One of Secretary Clinton’s greatest mistakes was comparing President Putin’s actions in Ukraine with those of Hitler in the Sudetenland.

It behoves us to remember that the Soviets lost nearly 30 million of their own citizens in their war with the Third Reich. Only 11 Million of these were soldiers – the rest of that amount were civilians.

Refraining from those comparisons is a taboo worth keeping.

Any Russian alive today will have lost family to the Wehrmacht.

European nations large and small suffered at the hands of fascists – from the victims of Guernica, through the horrors of the Holocaust, to the Balkan successor states of our modern time.

Cheapening their memory is a calumny.

As an American who is a strong friend of Europe and a strong believer in liberal democratic ideals that unify the west, it is baffling that we should now be considered “an enemy. “

Those who spent the years after the fall of the Berlin wall spreading democratic values across the former Soviet Union can always count on our admiration and respect.

I was one such party.

We clearly have more in common than the Europeans like to admit. It would be wise to focus on what brings us together, but it must be said: the Trump Administration has its own political priorities: namely: the American people.

President Reagan – another Republican accused of insufficient commitment to Europeans – famously won the Cold War by outspending the Soviets in the arms race.

Little remembered was the commitment he extended to NATO: 2% of the GDP of every alliance member should be dedicated to defense.

This commitment went unheeded over the course of every presidency since.

My fellow Republicans heavily criticized President Obama when he called some of our allies “Free Riders.” As Vice President Pence said last year in Munich, “the patience of the American people is finite. “

We welcome recent commitments by our European allies to increase NATO spending, but America must insist on results, not mere blandishments.

Europe, a rich continent, should shoulder its fair share of the burden for its own defense.

Almost 30 years have passed since President Reagan’s exhortation; we are entering the 6th presidency since the 2% commitment was made. Yet still Europeans say “Later”. Even the nice Canadians fail to pay their share.

The extenuating circumstances always convince: German reunification was miraculous. Having defeated communism, the allies wondered what NATO was for, until the Bosnian wars provided an answer.

The post-9/11 world led to controversial out-of-area operations. Then the bugbear of modern Europe – Financial Crisis – carried them to the present day.

Yet, last year, Germany posted a €6 billion budget surplus.

It is difficult to see that figure and accept the gradualism with which NATO’s 2% target is being complied. During the financial crisis, the EU used its powers to decide spending priorities. I’m sure the great minds of the European institutions will find creative ways to direct those powers towards our common objectives.

If they won’t then there should be consequences.

It remains to be said that some notions need updating. The burden sharing evidenced during the Libyan intervention was disastrous.

President Obama set out to “lead from behind” and ended up purveying the bulk of hardware, as well as the vital logistical functions: in-air refuelling, submarine-launched missiles and other mighty pieces of American muscle.

Devoid of American political commitment to the mission, it was a failure.

Malta and Italy bore the brunt of the costs for this failure.

But the EU paid in political legitimacy during ensuing bickering over refugees. Syria offered a redux: again, European failure to address issues that primarily affect Europe fostered infighting among member states, while millions of refugees streamed into neighboring countries – not the least Europe itself.

This was a problem tailor-made for Europe to step up and solve.

President Trump won on a platform of non-interventionism.

The founding fathers of the American Revolution did not believe in foreign entanglements. Indeed, every successful revolution tempers its resolve to enlighten the globe. “Let us raise a standard to which the Wise and Honest can repair. The rest is in the hands of God”.

President George Washington did not believe in spreading the revolution he led to other countries.

The EU has expanded very quickly, but hasn’t been raising a standard towards which its own citizens can always cast admiration. Now they want a new EU army on the cheap and some call America, “the enemy.”

We say this as friends who wish to see a successful and free Europe.

In a different context, President George W. Bush once spoke of the “soft bigotry of low expectations.” By expressing high expectations for European leadership in Europe’s own backyard, President Trump shows himself a true friend of Europe.

When the Soviets became tired of Leninist vanguards and permanent revolution, they invented the concept of “Socialism in one country”. President Trump will raise the standard to which the wise and honest can repair.

His platform is “Freedom in one country”. That country is the USA first but not alone.

We are committed to defend democracy where it exists, especially in Europe, but have renounced the liberal interventionist; neoconservative notion of spreading democracy throughout the world.

Make no mistake: America under Trump is Europe’s best friend, security shield, and trading partner.

But no longer are we silent participants, a cash machine or a quiet do-nothing idle partner.

America has a new mission: Greatness.

This mission need not clash with Europe; indeed it should revolve around a continued alliance and common Western values that have served Europe and the US so well.

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Understanding Sino-Russo-America Relations

2 December 2018, London

Elevating Sino-Russo-American relations to the long-term view, over decades and not bowing to daily market gyrations that fill broker’s pockets, much of the evolution in these relations can be explained.

Over the past century, communism failed both China and Russia. Socialism failed the West. Xi is losing the majority of Chinese youth who want open-market democracy, freer capitalism and individual self-fulfillment. His dictatorial hold on the CCP will crumble over the next decade.

Putin replaced the failed USSR and their corrupt Communist Party with a heavy-handed KGB-style domestic power structure and foreign policy attempting to rebuild the country’s prominence. The entrepreneurs ran away with all of their ill-begotten billions. He’ll be gone soon.

Both countries will fail again in the wake of Trump’s era of regaining the role of not being a Communist, and with all his personal flaws and lack of diplomatic or public sector experience, he is holding onto what The West seeks as its quality of life. When not, Americans are free to try to achieve improvement within a system built on the rule of law.

Both neo-Communisms will fail without this freedom or open market. However closed the West’s democratic governments are and ruled by elites, the open ability to pursue an independent lifestyle will win in the end.

That is the big picture in geo-political terms.China and Russia still lag dramatically behind America and the West as Third World countries outside their capitals. They will continue to pursue aggressive trade behaviour to catch up. Plus ca change…… In ten years, let’s all meet again and compare notes.

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China’s dominance shouldn’t shock the West

Gerard Baker in The Times,

24 November 2018

The ‘Middle Kingdom’ reigned supreme in the global economy for 18 centuries. Normal service is being resumed

Thanksgiving, celebrated across the United States today, not only offers an opportunity for Americans to fall out anew with family and indulge in some national culinary exceptionalism (sweet potatoes with marshmallows is high on my list of America’s many crimes against the palate).

It also serves to reconnect the country with its foundational legends, commemorating the moment the pilgrims sat down with the Native Americans in a mutual expression of existential gratitude: the immigrants thankful they hadn’t perished in the crossing from the old continent; the local tribes grateful they hadn’t (yet) been wiped out by the new arrivals’ weapons or germs.

The annual celebration of that first Thanksgiving, estimated to have been in 1621, is also a reminder of how young the country is. America was barren wilderness when Europe was well into its third millennium of civilisational development.

Even two hundred years after that first feast it was a nation in embryo, barely a generation old, clinging to a foothold on an unknown continent, eclipsed in wealth and power by Europe and Asia. One hundred years later — just a century ago — it was still far from certain that America would ever lay claim to the kind of influence that the British, Austrian, Russian and Ottoman empires had for centuries.

Yet today American global pre-eminence has become a fact of life. The span of our historical awareness is so short that the rise of challengers such as China or India seems shockingly modern. The idea that the 21st century may be the Asian century, as the 20th was America’s or the 19th Europe’s, is seen as a dramatic break with history. But it’s worth reminding ourselves that in some ways history’s clock is cyclical rather than linear.

In the longer view, America’s — and before that Europe’s — dominance may come to be seen as a short aberration and the rise of China and other Asian nations as simply a reversion to the natural order of things. That at least is the key point of a provocatively titled book, Has the West Lost It?, by Kishore Mahbubani, a Singaporean academic and former diplomat. As many in America and Europe contemplate the dramatic changes to their world in the past few years, it’s been getting a lot of attention.

From the birth of Christ until 1820, Mahbubani points out, China and India accounted for the lion’s share of global economic output. It’s only in the two centuries since the Napoleonic wars that Europe, and then Europe and America combined, have eclipsed the East.

Now the trend is firmly in reverse and the speed of the turnaround is striking. In the middle of the last century the US and Europe accounted for about 50 per cent of world GDP. They are now around 40 per cent and falling. And consider this testament to China’s decline and rise. Three hundred years ago the “Middle Kingdom”, as it was known, accounted for about one third of global economic output. The objective of the current leadership in Beijing is to mark the centenary of the founding of the People’s Republic in 1949 by restoring the country’s global economic share to one third. That would make China’s economy twice the size of America’s.

Of course there’s nothing inevitable about these rising and declining fortunes. While China and India account for almost 40 per cent of the world’s population there’s no iron law saying that sheer size of population will determine the strength of an economy. So what’s been happening?

In Mahbubani’s view the answer is twofold: first the Asian economies have learnt from the West’s success in the past 200 years and adopted and then adapted the key characteristics. The fount of this success is the triumph of reason. The Enlightenment that began in the late 17th century demolished scientific frontiers and allowed the West to leap ahead of the East, which was still constrained by religious thought and practice. But in the past 50 years especially, the fruits of the Enlightenment have been spread in Asia and cultivated an economic and psychological revolution that first lifted country after country out of poverty and then enhanced their growth to the status of fully developed economies. This was the widespread adoption of capitalism, with regional, national and ideological characteristics.

Second, and more or less simultaneously, Mahbubani argues, the West has squandered its advantages through a series of strategic mistakes. Most of these have occurred since the end of the Cold War; overreach in places such as Iraq and Afghanistan, financial excesses and a failure to absorb the costs and benefits of globalisation.

This part of the argument is incomplete. No doubt strategic mistakes have been made in the West but it’s also clear that in the past 20 years the US and Europe have lost pace in economic dynamism. That may be the result of an overweening state or internal divisions or perhaps — as the nationalists and populists claim — insufficient attention to national interest and too much to policies that benefit other nations.

The rise of “the rest” doesn’t have to be a zero-sum exercise, of course. But if China does achieve economic hegemony and chooses to exercise it as the West has, there’s a compelling need for the rest to get competitive again quickly.

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The Chinese Model is Failing Africa

https://www.ft.com/content/ca4072f6-a79f-11e8-a1b6-f368d365bf0e?hubRefSrc=email&utm_source=lfemail&utm_medium=email&utm_campaign=lfnotification#lf-content=237021208:806282656

Robert S. Stewart rss1@interopag.com     27th/28th August 2018

The present swath of African leaders are too weak to stand up to China’s power. “Bribe me” is about all they can say. This fits China’s model for swamping the continent in their goods and services, wiping out centuries of Western influence which was not strong enough to take hold on the populations, given the fickle nature of their leaders. The takeover since the late 1980’s has been overwhelming: partly sparkling superficiality, partly stealth, but primarily overpowering. It is a continuation of how Africa has allowed the invaders onto their territories since the 1600’s.

The Chinese influence will not only destroy their domestic markets and future economies, it will wipe out African culture unless millions in their populations rise up and lead a Revolution of self-sustaining measures. Their infrastructure is extremely weak. Who can ignore a map of existing energy structures, roads and railways which do not crisscross the continent? Building their shoddy, yet glittery connections will destroy that effort unless millions rise up to stop it. Their leaders will accept that work for a few pieces of silver. There is nothing wrong with major infrastructure projects that will connect the one billion indigenous people. But it has to be built to last for centuries to come.
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Godfree Roberts

@Robert S. Stewart rss1@interopag.com If you want to enjoy the international game more fully, I suggest you abandon the established wisdom that China’s government acts in as much bad faith as our own.

If you abandon that preconception and take the Chinese government at its word–then check its performance against its promises–you will be surprised and delighted.

The Chinese, inveterate hard-asses who have suffered through every form of government and misgovernment in the past 100 years, give the present government thumbs up: 95% trust and policy support. Not surprising when you consider that it’s ket every promise in its Five Year Plans for 60 years.

Most countries that deal with China have been pleasantly surprised and, setting aside the usual squabbles, have admitted that they benefit from the relationship and suffer very few if any disadvantages. China’s trade with the world is in balance, it hasn’t attacked anyone for 40 years (even then, with US support) and its made a lot of foreigners rich.

What’s not to like?

Robert S. Stewart rss1@interopag.com

Virtually every statement you make misses the mark about me and what I stated.

I am an African, a Ugandan to be clear. I have lived in Africa since 1968 and criss-crossed the continent overland hundreds of times, by Land Rover and in the air. I have also toured, traded with, invested in, helped to build and understand not just my home continent, but much of the entire rest of the world.

I don’t know if that makes me an expert as an ‘internationalist’, by I am confident that after hundreds of billions of Dollars/Pounds/Francs/Euros of completed investment in extraction and infrastructure projects, I know what I am doing derived from personal, first-hand experience, not swallowing too much won ton soup.

I have witnessed first-hand, Chinese exploitation in Uganda (Owen Falls II Dam failure costing our country hundreds of millions of dollars to repair and replace; the shoddy construction of the Tazara Railway from Dar to Lusaka, and when that was finished, the disappearance of the entire elephant herd from the Masai Mara into Chinese cargo ships for the transfer of ivory tusks to Asian markets; the arming of terrorist rebels in a dozen sub-saharan countries that overthrew elected democracies left behind in the 1960’s; the arming of the Sudanese Army to slaughter villagers in Darfur throughout South Sudan; the fraudulent rape of the DR Congo’s resources in return for more shoddy infrastructure; the construction of frills such as football stadiums in most capitals indebting the continent for decades or a lifetime; bribes to officials on a par with the People’s Republican Army and Chinese Communist Party; and hundreds of other excruciating horrors inflicted on unsuspecting African villagers. The list of rampaging violations stretches into books of evidence over decades that could never be overlooked by history. Don’t tempt me.

These aren’t preconceptions, they are facts of modern African history and China’s role in it.

For you to call the past century of Chinese leadership ‘hard asses’ is a flagrant understatement of the murderous era’s of obliteration of anyone confronting the longstanding Communist Party. Check the facts and consult history again from the Long March to Tiananmen Square.

Unlike your false statement that most countries are thrilled with their relationship with China, why are so many like the US and several African countries questioning what happened? Only those that have benefited from the corruption of African leaders would stoop to acknowledge this claim.

“China’s trade with the world is in balance”? Where did you dig up this insanity. There are thousands of historical trade graphs producing the facts which you seem to bulldoze over with platitudes. But you are right on one thing. “It has made a lot of foreigners rich”. The problem is that it was restricted to buying off the African leaders and was not trickled down or redistributed throughout the billion empty mouths that still wonder what hit them.

I suggest you do as I did. Take a Land Rover from Casablanca to Cape Town and back to Cairo. Then report to all of us on your findings about China’s sordid history in Africa. You’ll be cured of any more flagrant misgivings about what is going on around the continent with a vengeance. Don’t let the scorpions with their Gucci bags in the five star hotels on their high heels bite you! Go out to the countryside.

Kai Xue

@Robert S. Stewart rss1@interopag.com China’s present era of engagement with Africa begins in the 2000s. Ties had gone into a standstill in the 1980s and 1990s after misguided competition against the Soviet Union for third world allies had dampened and then disappeared.

If you want to discuss Maoism and engagement with Africa, then you have a starting point with your comment, but it doesn’t have much relevance to the present era.

Instead of a disorganized, litany of one-sided events presented as analysis, I try to approach the question of whether China benefits Africa with data and a framework for thinking.

1. What do you think is the number one measurable priority for Uganda to develop? (I’m not talking about creating progress, not simply measuring the effect of a cause.)

2. You are on the road a lot and I agree the focus of development should be on the countryside. Do you agree with the former Prime Minister of Ethiopia that an all-critical measure is the share of the countryside population with access within 2km to an all-weather road?

3. If the Chinese system of lending and construction contractors wasn’t present in Uganda, how successful would the country be in increasing the share with access to roads?

4. If there were only a limited number of new roads, what strategy do you propose would increase agricultural productivity?

5. Without increasing agricultural productivity in the mostly agricultural country of Uganda and without counting on a game changing discovery of natural resources (especially considering per capita how much the revenue from resources would be diluted), how will your country develop?

@Kai Xue @Robert S. Stewart rss1@interopag.com

Sorry, like Godfree Roberts above, your facts are wrong and statements/questions are very misleading. The Chinese were already implementing a continent-wide, not-so-stealth foreign policy across Africa in the early 1970’s. That is why I brought up the ill-fated disaster of the Owen Falls II Dam on the Nile which was started then but had to be completely replaced at great cost to tax-paying Ugandans after the World Bank accepted the disgraceful materials that went into it. It was built and paid for twice by Ugandans.

In the 1970’s and 1980’s, the Chinese were arming Robert Mugabe with their AK47’s to destroy Zimbabwe’s plentiful, century-old fields of produce filled with self-sufficiency and export produce, using them to kill fifth generation White farmers. They built a wasteful football stadium in the middle of Harare and saddled the country with more massive debts. They did the same in Nigeria, building a stadium in Lagos and supplying hardcore military hardware to the Nigerian military: more debt. Who were the Nigerians fighting at the time? No one.

In the 1990’s, the DR Congo was invaded by the Chinese donors promising to replace the $50 billion Bechtel Master Plan (which I wrote in 1997) to rebuild the entire road/rail/port/airport infrastructure, extractive and agricultural sectors of the ruined country. Instead they sprayed tar onto a few mud roads, delivered 1940’s era telephone equipment and stole the country’s copper/cobalt.

Check out Dar es Salaam harbour in the 1970’s and 1980’s that was filled with Chinese ships dropping off cheap cargo in return for precious ivory culled off the Masai Mara and Serengeti Plains. The Chinese had bribed every Tanzanian Cabinet Minister with cars and trips to Beijing with copies of the Little Red Book, when few could read it. Canadians had to rip up the Tazara Railway to Lusaka and replace it with the proper gauge.

Your questions ignore the facts of what was going on in Africa – a full scale economic routing of the countries desperate for long-term development assistance. As I mentioned above, the cases of Sudan and Darfur whilst grabbing the oil near Port Sudan, the continuing slaughter of South Sudanese, the support of Nelson Mandela with arms, terrorist equipment to destroy South Africa’s giant economy decades ago through jungle routes from Tanzania and Mozambique.

There are volumes that will be written some day extolling the massacres that took place in a dozen countries when rebel groups were supplied with Chinese arms under Qadhafi’s influence to overthrow democratic governments that were still holding onto a semblance of infrastructure left behind by the Europeans/North Americans/Japanese/Taiwanese.

The arms trade started the deluge, followed by the delivery of fraudulent Master Plans, then poor quality goods and services. How many Chinese enclaves surrounded by barbed wire and gated compounds now dot the landscape in every capital city of Africa and all the work projects across the continent? Was this a friendly gesture of co-mingling with allies and solidarity with the people?

Only if you are under 30 years of age, wearing blinkers about the facts or dodging the truth of history, could you miss the many deeds unleashed on this poor continent by thousands of Chinese workers, many of whom were left behind in Africa to fend for themselves after their projects were finished. Some came from prisons and mental institutions in China.

As you can see by the numbers of assenting recommendations for many of my comments, it appears that most readers back the facts rather than spurious attempts at the fiction.

No, sadly, the continent has been knocked back another Century by this invasion of ill-conceived ‘development assistance’ which will leave a very damaging pall over the land and people. Africans must now take on a more insidious challenge in ridding their continent of leaders soaked in Chinese corruption who failed to deliver the promised Aid. Coined in the rhetoric of Chairman Mao, it has left an indelible mark that will be difficult to erase and repair.

European economies and corporations, especially the British, could restore some of what is lost and at the same time renew relations with Africa that would help to end these wounds and provide a mutual era of higher quality education, agriculture, infrastructure and extractive products to fuel the global economy. Anything would be better than what has gone on. Watch what comes out of the China/Africa Meetings in Beijing this week. Mrs. May, your country could do much better for both your sakes.

@Robert S. Stewart rss1@interopag.com I’m disappointed. You claimed to have done a lot of deals and lived in Africa for 50 years. I was hoping for a discussion with someone reasonable, well informed, commercial and practical. But by your responses it looks like you’re are a fanatic and very tedious to have a conversation with.

Robert S. Stewart rss1@interopag.com

@Kai Xue @Robert S. Stewart rss1@interopag.com

Terribly sorry to disappoint you but I believe in the truth, facts, reality, and not forgotten history and a revision of anything close to what really happened. I am not very good on fantasy that covers up the massive blight forced on Africa for the past 50 years by Chinese invaders who will leave a disgraceful legacy behind when they finally go.

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The ship tycoon, the con men and a €100m scam

When fraudsters embarked on an elaborate sting, they made one big miscalculation: their victim.

Finally, the FT has done some brilliant journalism, chasing down a scam, its perpetrators and the victim who fought back. Read the main story here in the FT:

https://www.ft.com/content/d4bc5a02-7995-11e8-bc55-50daf11b720d?emailId=5b3650e88712e50004d96077&segmentId=2e4343f6-b08f-9184-785d-0a53b99d57bf

 

The world’s biggest ship (by volume) Pioneering Spirit was subjected to a monster scam, but the victim Edward Heerema, a Dutch shipbuilder, fought back:

Anyone listening to those purporting to have US Government officials sanction a “secret trading system”, backed by Vatican connections, with UN officials looking on, cloaked in the Portuguese clothing of a mafia don, bouncing between shady Malta and Lichtenstein banks, is only asking for trouble.

Heerma is no fool but he forgot to put on his “due diligence” cap, invoke the legendary Dutch reserve, and undertake the requisite research to uncover such a giant fraud as this “too good to be true” offer. However, his energy and enthusiasm to seek recourse and not only recover his funds but bury the perpetrators, is an act of heroism and a distinct contribution to destroy the fraudsters and hope they and other dreamers never see the light of day again.

This story needs to be writ in bold letters and disseminated in movies, books and documentary films to get the message out, that crime occasionally pays, but like the Canadian Mounties, serious investigators will “always get these men”. Bravo to Heerma. He now deserves a ship in his own name as a lesson to avoid fraudsters everywhere!

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