Economics & Business Archive

With FARC peace talks offering hope of a final settlement, Colombia is looking to cement the gains of the past decade. To do so will require filling in significant gaps in governance and building on the economic momentum provided by the U.S. free trade agreement and the Pacific Alliance. This World Politics Review special report looks at Colombia’s steps toward a new era of stability. Governance and Security Colombia’s Santos Gambles on FARC TalksBy Frida GhitisSeptember 6, 2012 After It Makes Peace, Colombia Must GovernBy Adam IsacsonApril 12, 2013 Chávez’s Absence Casts Shadow Over Colombia Peace TalksBy Andrew RosatiMarch 5, […]

Late last month, more than a decade of indecision over the so-called Southern Gas Corridor linking Caspian reserves to European Union markets finally came to an end with the selection of the Trans-Adriatic Pipeline (TAP) by the Shah Deniz consortium of gas producers in Azerbaijan. TAP was selected over the much more widely recognized and operatically named Nabucco pipeline, which had captivated the energy industry and shaped the geopolitics of the Black Sea-Caspian region for years. Shah Deniz consortium members, which include BP, Statoil, Total and Azerbaijan’s national energy company SOCAR, insist that the selection was based almost entirely on […]

While much of the world’s attention was focused on the birth of Britain’s Prince George, U.S. Vice President Joe Biden was visiting India, in an attempt to get the bilateral relationship between the world’s oldest and largest democracies back on track. New Delhi is understandably wary of the Obama administration. India’s policymakers are concerned about a possible U.S. “rush for the exits” in Afghanistan after 2014, especially if it involves a deal with the Taliban that would allow the militants to exercise real authority in the country and undercut Indian interests. Moreover, while India has real issues with China, including […]

During the first-ever business and commerce conference of the Indian Ocean Rim-Association for Regional Cooperation (IOR-ARC) in July, Indian Commerce Minister Anand Sharma called for an institutional mechanism to facilitate business interaction among members. Though the IOR-ARC has existed since 1995-1996, it has so far failed to emerge as a common economic platform, and India’s trade ties in the IOR region have progressed chiefly along bilateral lines. But with China’s economic overtures increasingly frequent and backed by commercial heft, India finds that it can no longer take its geo-economic position in the region for granted. To counter China’s commercial bilateralism, […]

On June 26, Kyrgyz President Almazbek Atambayev formally signed a law “annulling” the country’s agreement with the U.S. to host an air base in his country. The true significance of the law is unclear, and it could be a bargaining ploy to gain more favorable terms for a new agreement on the base, which has been the United States’ most conspicuous presence in Central Asia since being established shortly after the Sept. 11 attacks. Regardless, the passage of the law has highlighted how U.S. interest in Central Asia is destined to diminish as the U.S. extracts itself from Afghanistan. In […]

In July 2012, amid the euphoria of historic elections, Libya’s future seemed brighter than ever. The polls were Libya’s first democratic elections in more than 52 years, and the promise of Libya’s Arab Spring seemed closer at hand. Many obstacles had been surmounted to demonstrate to the world that the nation could prevail against strong odds. But those obstacles have not for the most part been overcome. One year after the elections and two years after the fall of Tripoli and the toppling of Moammar Gadhafi, Libya’s transition continues to confound and dismay most observers. This is due in part […]

After nine months in Havana, Cuba, negotiators are making slow but steady progress toward ending the conflict between Colombia’s government and its largest leftist guerrilla group, the 49-year-old Revolutionary Armed Forces of Colombia (FARC). The talks are now at the second of five agenda points, and a growing segment of public opinion believes that this peace process—the fourth in the past 30 years—may end in an accord. But the FARC are not Colombia’s only leftist guerrilla group with a national presence. The National Liberation Army (ELN), like the FARC, was founded in 1964. The ELN differs from the FARC in […]

A reform push in Mexico that many have termed historic could get epic this fall. That’s when President Enrique Pena Nieto will introduce plans to reform the oil and gas sector and overhaul the country’s tax system. There’s a broad consensus among economists that Mexico’s growth and long-term vitality rely on the passage of these plans, interlinked because oil revenues constitute a substantial part—around one-third—of the federal budget. And there’s a general acknowledgment across much of the Mexican political spectrum that Pemex, the state-owned oil company, is in dire need of reform. Now in its 75th year, the company’s reputation […]

At the heart of the turmoil that continues to afflict Egypt lies the sharp ideological divide that separates liberals and Islamists. But ideology alone—differences of opinion over the role of religion, separation of powers and women’s rights, among other issues—does not explain the extent to which the renewed conflict has engulfed the country. Ideology fires up the most die-hard activists on both sides, but something much more mundane mobilizes the masses: The economy is the thing for all but the most committed. Personal privation—a decrease in living standards that has cut across much of Egyptian society—is what has produced the […]

An increasing number of Southern Europeans are leaving their recession-ridden countries in search of work and opportunities in the North, especially in Germany, raising fears that these countries’ problems will be compounded by a brain drain should their economies not improve. Between 2009 and 2011, outflows of people from countries most affected by the crisis, in particular in Southern Europe, rose by 45 percent, according to a recent report by the Organization for Economic Cooperation and Development. And Germany, with its low rates of overall and youth unemployment—5.3 percent and 7.6 percent, respectively—is a prime destination for this new migration […]

In May 2010, while the rest of the Western world was busy picking up the pieces from the combined banking and real estate crises, a fiscal crisis hit Greece. The Greek government discovered it was unable to service the country’s soaring public debt, which stood at 129 percent of GDP in 2009. That year, Greece’s budget deficit was 15.6 percent of GDP, while its current account deficit was 15 percent of GDP. Soon the state coffers would be depleted, leaving the 20 percent of the country’s labor force that works in the public sector without compensation and numerous state-owned enterprises, […]

Since coming to office in January 2011, Brazilian President Dilma Rousseff has had to contend with annual economic growth slumping from 7.5 percent to 0.9 percent. Rather than introducing economic reforms—the president interpreted her mandate as one of continuing the policies set out by her predecessor, Luiz Inacio Lula da Silva—Rousseff’s team blamed a strong Brazilian currency for slow growth and nagging inflation. So, given that the value of the Brazilian real fell 10 percent against the dollar from May to June, reaching a four-year low, one would expect the government to be celebrating the new opportunity to export Brazilian […]

A rather small country by its size and population—65 million, less than 1 percent of total global population—France is nevertheless one of five to 10 countries that can claim to be major powers in today’s world. The French economy is, however, plagued with sluggish growth, an unemployment level now hovering around 10 percent of the active population, a budget that has been in deficit for more than three decades and a public debt that represents more than 90 percent of its GDP—with more than 60 percent of that debt held by nonresidents, as opposed to about 30 percent for the […]

Last month, the government of Israeli Prime Minister Benjamin Netanyahu announced plans to export up to 40 percent of the gas from Israel’s Eastern Mediterranean fields, with expected earnings of up to $60 billion over a 20-year period. This is, however, only the first step toward realizing export revenues from Israel’s gas reserves, a process fraught with complicated choices over the route and destination of those exports. Rather than aiming to use its gas for any great geopolitical gains, Israel currently seems happy to avoid unsettling interested parties while it reaps long-term economic gains from its gas bounty. Domestically sourced […]

Portugal appeared to be on the brink of government collapse last week after a string of unexpected ministerial resignations. But so far, the coalition government under Prime Minister Pedro Passos Coelho has survived. Jacob Funk Kirkegaard, senior fellow at the Peterson Institute for International Economics, said that Portugal, which has faced three years of recession and has imposed unpopular austerity measures under the terms of a European Union bailout, is more notable for its stability than its turmoil. “This recent political crisis is fundamentally driven by political positioning, not driven by people on the street saying enough is enough, and […]

Maritime crime and disorder have plagued the Gulf of Guinea for decades, as weak and corrupt maritime security regimes emboldened thieves, smugglers and traffickers to exploit the littoral realm. The bountiful vessels serving Nigeria’s oil fields have presented a particular brand of pirates with a lucrative array of targets. With piracy no longer confined to Nigerian waters, however, West and Central African states have now recognized piracy as a regional crisis, as highlighted by a June 24-25 summit in Yaounde, Cameroon, to address the issue. “No country can withstand the growing challenges individually. That is why we agreed to put […]

The U.S. missile defense program suffered perhaps its most serious test failure in recent history last week. The July 5 setback should serve as a warning to the Pentagon for the need to hedge against further deficiencies in the Ground-based Midcourse Defense (GMD) system, a core element of the U.S. Ballistic Missile Defense System (BMDS). On Friday afternoon, the Defense Department launched a missile from the Army’s Reagan Test Site on Kwajalein Atoll, Republic of the Marshall Islands. Several minutes later, the Pentagon launched an unarmed Exoatmospheric Kill Vehicle (EKV) aboard a rocket from Vandenberg Air Force Base in California […]