Economics & Business Archive

Earlier this month, the leaders of Vietnam, Laos, Cambodia, and host country Thailand gathered for the first-ever Mekong River Commission (MRC) summit to discuss the future of the Mekong, one of the world’s longest and most resource-rich rivers. There was much to discuss. The Mekong — which flows through China, Myanmar, Vietnam, Laos, Cambodia and Thailand, and provides food, water, and transport for about 65 million people — is now at its lowest level in two decades due to a prolonged drought. Its future is also in peril due to a host of natural and man-made threats. Unless riparian states […]

Last week, I highlighted the “bad news” that came out of Brasilia with regards to Washington’s Iran policy. There was, however, a silver lining that should not be ignored. Brazil’s President Luiz Inacio Lula de Silva hosted two meetings that week — that of the Brazil-Russia-India-China group (BRIC) and another for the India-Brazil-South Africa forum (IBSA). What is interesting to note is that China’s interest in playing a greater role in IBSA — with some even talking about expanding that group to become CHIBSA — was politely rebuffed. Indian Prime Minister Manmohan Singh stressed that IBSA is not simply a […]

When the finance ministers of the G-20 nations met on the sidelines of the annual IMF-World Bank meetings in Washington last weekend, it marked the sixth time they had convened since the fall of 2008. When the G-20 leaders meet this summer in Toronto, the total number of summits held since the global financial crisis erupted will hit double digits. And yet, despite early cooperation that addressed the global liquidity shortfall, little substantial progress has been made in the area of international financial regulation. Given the trauma that the entire world economy has suffered, in part due to a lack […]

Despite fist fights and smoke bombs within the parliament building as well as protests outside the Supreme Rada, Ukrainian legislators yesterday ratified the controversial Russian-Ukraine base-for-gas agreement. According to the deal’s provisions, in exchange for Moscow accepting lower prices for Ukraine’s gas purchases, the Russian Navy can remain at its Sevastopol base in the Crimea for another 25 years after the current lease expires in 2017. Ukrainian protesters attacked the new government under President Viktor Yanukovych for allegedly “trading sovereignty for gas.” While the precise amount of revenues that Russia will forego by subsidizing gas sales to Ukraine will depend […]

Indian External Affairs Minister S.M. Krishna returned from Beijing this month with bombshell news. Krishna said Chinese authorities had finally admitted what the Indian government had long suspected: Beijing is building a massive, power-generating dam on China’s Tsang Po river, which also runs through India — where it is known as the Brahmaputra — and Bangladesh. Amid protests, Krishna reassured the public. “We have an expert-level mechanism to address the issue,” the minister said during a meeting of parliament, according to press reports. “A meeting of experts from both India and China is scheduled to take place between April 26-29 […]

Pakistan may not have been able to secure a nuclear deal from Washington, but it seems to have sewn up an agreement for building additional reactors with longtime ally China. Announced late last month, the agreement comes at a time when Pakistan’s economy remains moribund, even as its energy requirements continue to rise. While this specific deal is unlikely to make a significant dent on Pakistan’s energy deficit anytime soon, it nevertheless serves as a symbol of the durability of the Sino-Pakistani “all-weather friendship” against which Islamabad often judges its relations with Washington. The two countries will proceed on the […]

At first glance, it is difficult to put a positive spin on hardliner Dervis Eroglu’s victory in Turkish Cyprus’ presidential elections on April 18. The result certainly challenges the future of negotiations to reunify the 1.1 million inhabitants of the Mediterranean island, 80 percent of whom are Greek Cypriots and 20 percent Turkish Cypriots. Eroglu, who has been prime minister of the self-declared Turkish Republic of North Cyprus for 19 of its 27 years, won just over 50 percent of the votes. President Mehmet Ali Talat, the pro-compromise incumbent whose pledge to solve the Cyprus problem had brought him to […]

The last few months have witnessed a resurgence in expert chatter on the possible demise of Kim Jong Il’s rule in North Korea. Growing evidence of regime frailty has focused attention on potential scenarios of endgame dynamics, most of which feature some combination of Kim striking out against the West, and China being forced to step in to prevent the dreaded refugee flow north. But while the nuclear issue remains a driver of Western policy toward North Korea, China’s current focus seems less ideological than predatory. Like a mafia don “busting out” a victimized business partner, Beijing now seems mainly […]

On May 9, voters in the German state of North Rhine Westphalia (NRW) take to the polls to decide what in the past has typically been a quiet, local parliamentary election with little impact on the national agenda. This year, however, is different. German Chancellor Angela Merkel and her center-right Christian Democratic Union-Free Democratic Party coalition government are in danger of losing the Bundestag, the upper house of the German government, in the elections. Plagued by infighting and the inability to agree on a comprehensive agenda, the coalition has stumbled through a number of domestic missteps, from an unpopular tax […]

On March 30, Malaysian Prime Minister Najib Razak unveiled a new growth strategy designed to transform Malaysia into a high-income economy by 2020. But while the New Economic Model (NEM) contains much-needed reforms to boost Malaysia’s economy and political image in the face of dwindling foreign investment and rising competition, severe doubts remain about whether Najib can actually implement them. The NEM pledges to boost Malaysia’s per capita annual income from the present $7,000 to $15,000 through a raft of measures, including enhancing the role of the private sector, improving worker skills and productivity, and reducing the dependence on foreign […]

Russian officials have recently accused U.S. and NATO forces in Afghanistan of “conniving with drug producers” and urged the coalition to pursue aggressive aerial eradication operations against Afghanistan’s opium poppy crops. Despite having spent over $1 billion on counternarcotics programs in Afghanistan since 2002, including eradication efforts, the U.S. and the U.K. have failed to curb the illicit drug industry there. Moscow’s tough stance on narcotics stems from its own internal consumption levels, which have steadily reached epidemic proportions. According to 2008 records, up to 21 percent of the world’s production of illicit opiates ended up in Russia, resulting in […]

The most likely source of political and social unrest in the Middle East over the next 20 years is not warfare or military coups — it’s water. Military threats get all the press, but water is the real game-changer. It is no secret that the Middle East is water-starved. Of the 15 most water-poor countries in the world, 10 are in the Middle East. When King Abdul Aziz ibn Saud first brought geologists to the Kingdom of Saudi Arabia, they were there to look for water, not oil. What they found changed the kingdom, and changed the region. Over the […]

It has been a devastating few weeks for the global mining community. In late March, a flood in a coal mine in northern Shanxi province in China resulted in the deaths of more than 30 workers. Then last week, in West Virginia, an explosion at a coal mine killed nearly 30 miners. Both accidents revealed some of the safety hazards associated with mining. Meanwhile, as the United States was coping with its worst mining disaster in years, two nations in Latin America were dealing with mining tragedies of their own. Those tragedies, however, had little to do with the dangerous […]

After months of speculation over whether Russia and China would come on board for a new round of sanctions against Iran, the parameters of a new United Nations Security Council resolution appear to be taking shape. Conversations between President Barack Obama and his Russian and Chinese counterparts, Dmitry Medvedev and Hu Jintao, at this week’s Nuclear Security Summit seem to have produced a consensus among the “permanent five” Security Council members. Two obstacles remain: the actual crafting of any resolution — and whether the final product will pass muster with the U.S. Congress. Up to now, the Obama administration has […]

The 16th summit of the Association of Southeast Asia Nations (ASEAN) ended in Hanoi last Friday with a pledge to broaden implementation of the bloc’s cooperation pacts over the next five years, a move expected to provide a significant boost to regional economies. As the leaders signed off on the pledge, free trade across much of Southeast Asia was marking its first 100 days. Implemented on Jan. 1, the ASEAN Free Trade Area (AFTA) is off to a promising start, although it has also won its fair share of critics in recent months. AFTA’s initial target was to eliminate import […]

Last month’s terrorist bombings of the Moscow Metro along with other indicators of surging Islamic-inspired violence in southern Russia suggest that the Kremlin has yet to overcome longstanding Muslim hostility to Moscow’s control of the North Caucasus. Although the Russian federal government adopted a new strategy a year ago that might eventually overcome some persistent problems, the Moscow massacre risks triggering another wave of escalating reciprocal violence. Throughout the past year, the North Caucasus republics of Chechnya, Dagestan, and Ingushetia have experienced increasing terrorist violence (.pdf). In Chechnya, for example, the number of violent deaths nearly doubled in 2009 compared […]

NEW DELHI — The short-but-fruitful visit by Russian Prime Minister Vladimir Putin to India last month has resulted in a rich economic and diplomatic haul for the two countries. Moscow and New Delhi signed a raft of deals — predominantly in defense (to the tune of $4 billion) and civil nuclear cooperation — in hopes of boosting annual bilateral trade from the current $7.5 billion to $20 billion by 2015. The agreements will facilitate the construction of 16 Russian-designed nuclear reactors in India, and lead to greater cooperation in the fields of gas, oil and hydrocarbons. India will also work […]