Economics & Business Archive

Editor’s Note: This article was first published on Nov. 10, 2009, as part of the WPR feature “China’s Once and Future Rise.” It is made available here for free as part of a promotion that ends Jan. 5. To experience more of WPR”s subscription service, sign up for 30-day free trial. On Oct. 1, the People’s Republic of China celebrated the 60th anniversary of its founding, most notably with an air show and military parade along Beijing’s Orwellian-sounding Avenue of Eternal Peace. The event showcased China’s arsenal of indigenously made fighter aircraft, tanks and newer-generation Dongfeng missiles, capable of delivering […]

ISLAMABAD — It is often noted that the outcome of the war in Afghanistan may well determine who gains access to the oil and gas reserves of Central Asia. Pakistan, being a gateway to the mineral resource wealth of Central Asia, has been a key participant in the Afghan conflict. But what is generally less well-known is that Pakistan’s own oil and gas reserves have also attracted significant attention from large multinational energy corporations. According to government sources, Pakistan possesses reserves of 27 billion barrels of oil and 280 trillion cubic feet of gas. Yet most of that wealth remains […]

NEW DELHI — India has a long history of deferring critical choices for its armed forces, with defense buildups occurring always after military emergencies, rather than in anticipation of potential ones. The same is true today, when severe deficiencies in equipment and inventories have put archaic Indian acquisition norms in the spotlight, particularly in the aftermath of the Mumbai terror attacks last year. Prime Minister Manmohan Singh acknowledged problems with India’s defense acquisitions in a recent speech to the Combined Commanders’ Conference in New Delhi, saying, “I am aware that procedures for defense acquisitions and procurements are a matter of […]

In a region that already has enough conflicts, another one is brewing, and it comes from a surprising source: the Nile. The river that has traversed history from the pharaohs through to the Bible and on to the nationalist revolution of 1952 seems poised to enter a new phase. Only this time, there may not be enough water to go around. Egypt’s history is intimately tied to the Nile. A country with very little rainfall, its agriculture was long reliant on the river’s annual floods. Public works projects through the late 19th and early 20th centuries subsequently helped regulate the […]

Get a .pdf version of this report. During the last five decades, Colombia’s foreign, defense and strategic priorities have been driven and determined by the country’s internal armed conflict, with the “War on Drugs” becoming the dominant paradigm from the 1980s onwards. This, in turn, has defined Colombia’s relations with Latin America — particularly, in recent years, with its Andean neighbors, Ecuador and Venezuela — as well as its relationship with the United States and Europe. Colombia’s struggle to stem cocaine production, its fight against the drug cartels that sprung up around the drug trade, and its war against the […]

TORREÓN, Mexico — On Dec. 9, Mexican President Felipe Calderón tabbed Finance Minister Agustín Carstens to head the nation’s central bank, known as Banxico.Carstens replaces Guillermo Ortiz, a highly respected official who had occupied the post for 12 years. Despite a political climate increasingly hostile toward Calderón, the move — which had been rumored for weeks — brought waves of approval. The markets, the punditry, and that titan of Mexico’s economy, Carlos Slim, were all pleased by the selection, with the latter raving, “[W]ithout a doubt, Carstens has all of the credentials to occupy the post.” Among Calderón’s cabinet members, […]

Last week, I noted that the GOP’s defense hawks have taken to accusing President Barack Obama and congressional Democrats of exploiting America’s health care crisis to further their long-term “plot” to curtail defense spending — and, by extension, our nation’s capacity for military interventions abroad. The implied beneficiary of this “unilateral surrender”? Why, the Chinese, of course, who’d thereby be left free to conquer the developing world in their unending quest to secure raw materials. But a funny thing happened on the way to China’s presumed domination of the world’s natural resources: It ran into the same core problem that […]

TOKYO — Asia may already have an alphabet soup of regional economic and security arrangements, but Australian Prime Minister Kevin Rudd seems to believe there is room for at least one more. At a gathering of regional ministers, media and think tanks, Rudd argued that the region risked drifting in the face of challenges ahead. “We need to plan — we need to plan with each other, rather than against each other, as has often been the custom in times past,” he said, addressing a two-day conference, “Asia Pacific: A Community for the 21st Century,” held in Sydney beginning last […]

NEW DELHI — After months of vacillation, and relentless pressure from Western nations, India finally announced a unilateral climate mitigation measure to reduce its carbon intensity levels by 20 percent to 25 percent on its 2005 levels over the next 11 years. The decision comes against the looming backdrop of the United Nations Climate Change Summit in Copenhagen, which opened on Dec. 7. The new goals mark an unambiguous departure from New Delhi’s traditional position that rich nations are historically responsible for global warming and should therefore take up the bulk of the responsibility for all reduction efforts. India has […]

When President Barack Obama accepts his Nobel Peace Prize this week in Oslo, it will likely amplify the grumbling of those who think he is being rewarded for circumscribing American power. Obama’s diplomatic efforts to date have elicited complaints that he is “starry eyed” and “weak,” too solicitous of foreign leaders, and even “accommodating” of America’s enemies. These criticisms miss the point. Barack Obama isn’t weak. He just helms a superpower whose power and influence is on the wane. Even as it remains the most powerful nation in the world, the United States is becoming, as the Bush-era National Intelligence […]

Iran has long been considered one of India’s key allies in the Muslim world. But relations between the two countries have been adrift since India voted against Iran at the IAEA, in 2005 and 2006. Taken aback by India’s position, the Islamic republic responded by blocking already contracted shipments of liquid natural gas (LNG) on the grounds that the price needed to be renegotiated. The move effectively downgraded the Indo-Iranian energy relationship, with Iran subsequently making noises about building a gas pipeline to China, even as Saudi Arabia’s importance as an energy supplier to India continues to grow. However, the […]

The current annual summit between the governments of India and Russia, scheduled to last from Dec. 6-8, testifies to the continuing shared interests between both countries. Russian and Indian policymakers still pursue many common objectives while having few divergent ones. Yet, ongoing improvements in India’s relations with Western countries, especially the United States, present challenges to Russian policymakers as they strive to maintain Russia’s position as India’s most important strategic partner. A few days before arriving in Moscow, Indian Prime Minister Manmohan Singh gave a lengthy interview with Russian media outlets in which he lavished praise on Russia. Calling their […]

BRUSSELS — While media and popular attention has focused on the European Union’s nominations for its newly created positions of president and high representative for external affairs, key positions recently filled on the European Commission suggest a major shift in the EU’s economic policies. In an apparent reaction to the financial and economic crisis, the commissioners chosen for the main economic portfolios are likely to alter the union’s pro-market approach of recent years. The commission is the EU’s supranational institution, with functions similar to the executive branch of national governments. Although each country is guaranteed a commissioner, the importance of […]

Low interest rates have become something of a staple at the U.S. Federal Reserve in recent years. However, early last month, the U.S. central bank took its “cheap dollar” policy to another level by committing to near-zero interest rates for the foreseeable future. The Fed’s decision has its roots in domestic economic goals: With American unemployment hovering above 10 percent, low rates are seen as a way to jump-start bank lending to businesses — a necessary first step in getting these firms to increase staffing. Low rates also make it cheaper to buy a home and should help the U.S. […]

During his sojourn in Paris last Friday and Saturday, Russian Prime Minister Vladimir Putin and his entourage of Russian economics ministers and business executives signed a number of important commercial agreements with their French counterparts. These two-dozen deals will result in increased French involvement in various Russian energy and automobile enterprises, in return for sizable injections of French financing and technology into these sectors. “We are on the way to achieving this goal to transform our good, high-level political relations in the sphere of the real economy,” Putin joyfully told journalists. “I think it is a real breakthrough in the […]