Economics & Business Archive

Earlier this month, China and South Korea reached a free trade agreement (FTA). In an email interview, Tony Nash, global vice president of Delta Economics, discussed the implications of the China-South Korea FTA. WPR: How comprehensive is the FTA with China compared to other high-profile FTAs South Korea has signed recently, and what explains any differences? Tony Nash: China and South Korea have studied and discussed this agreement for over a decade. The concept of the FTA is quite comprehensive, with more than 90 percent of goods covered as well as interesting modalities around online purchases and government procurement, which […]

Since coming to power in 2012, Chinese President Xi Jinping has exhibited a more forceful and direct style of governance than his predecessor. That has included an unprecedented domestic anti-corruption campaign, a renewed push at corporate sector reform and a more strident posture in many aspects of foreign policy. Some foreign commentators have interpreted these moves as an attempt to recentralize political power and even re-establish the “cult of personality” around political leaders that prevailed in China for much of the 20th century. An alternative interpretation is that Xi’s government has acknowledged fundamental problems within the Chinese political economy and […]

Chinese investment and engagement now touches almost every aspect of Africa’s economy, including infrastructure, transport and logistics, trade, manufacture, agriculture, telecommunications and, of course, resource extraction. Because of the vastness of this engagement, commentators frequently fall back on catchall concepts, including an assumption that Africa is essentially passive in this relationship. The reality is much more complicated. Instead of simply imposing Chinese approaches on African realities, Chinese actors frequently try to attain their goals by partially adapting to specific African systems, with varying degrees of success. This article provides examples of this process by looking at China’s relationships with three […]

Earlier this month, the International Consortium of Investigative Journalists published a cache of documents exposing how numerous multinational firms have avoided paying billions of dollars in taxes while maintaining only a token presence in Luxembourg. The so-called Lux Leaks scandal has directly touched Jean-Claude Juncker, who assumed his role as president of the European Commission, the European Union’s legislative body, on Nov. 1. Juncker served as both finance minister and prime minster of Luxembourg, prompting many questions about his knowledge of and role in the scandal. Lux Leaks has confirmed what many already knew, or at least suspected. In fact, […]

Autumn has been a difficult season for Mexican President Enrique Pena Nieto. Public furor has erupted into sustained and sometimes violent protests over the disappearance of 43 students in the rural southwestern state of Guerrero. Long one of Mexico’s poorest, most crime-ridden and isolated states, Guerrero had not been a priority for Pena Nieto’s administration, which has focused tirelessly on promoting the image of a modern and efficient Mexico to foreign investors. But as Guerrero’s longstanding economic and security problems became headline news across the world in the past month, that crafted image of a Mexico open for business after […]

Last week, Mongolia’s parliament appointed Chimed Saikhanbileg prime minister, two weeks after Norov Altankhuyag lost a no-confidence vote. In an email interview, Julian Dierkes, associate professor at the University of British Columbia, discussed Mongolian politics. WPR: What factors explain the recent no-confidence vote against former Prime Minister Norov Altankhuyag? Julian Dierkes: Surprisingly, Norov Altankhuyag was the longest-serving prime minister from the Democratic Party (DP). However, during the two and a half years that he was in office, Mongolia came to face an economic crisis that was largely government-made through strict foreign investment regulation and poor fiscal decisions. Altankhuyag did not […]

Earlier this month, while Brazilian President Dilma Rousseff rubbed shoulders with other global leaders at the G-20 summit in Australia, her justice minister, Jose Eduardo Cardozo, announced the arrest back in Brazil of 15 people for arranging kickbacks on contracts from state-owned oil company Petrobras. Shortly after hearing the news, two more executives from a major Sao Paulo construction company turned themselves in to police. The second round of the corruption investigation known as Operation Carwash was underway, and by Nov. 16, 23 people would be arrested, including Renato Duque, former head of services at Petrobras. As word of the […]

The United States and China surprised other G-20 members when they announced a new agreement last week on curbing greenhouse gas emissions just a few days prior to the group’s summit in Australia. But the G-20 member who perhaps noted this development more than others is India, currently the world’s fourth-largest greenhouse gas emitter. India was taken off guard by what amounts to China’s first step back from its previous ironclad refusal to make any binding commitments on limiting overall emissions. New Delhi is now preparing to fend off greater pressure directed its way to make similar pledges in the […]

In the months after Mexican President Enrique Pena Nieto took office almost two years ago, he impressed even the skeptics with his dynamism, tackling the seemingly immovable forces that had been blocking his country’s progress. For a time it seemed as if the new administration was about to usher in Mexico’s long-awaited revolution, one that vowed to replace poverty and hopelessness with a sense of equality and a measure of social justice, even if he was crafting that transformation through legislation rather than Molotov cocktails. Now, however, that impression has been shattered. Outraged Mexicans have been throwing real Molotov cocktails […]

When the European Space Agency (ESA) successfully landed the spacecraft Philae on a comet last week, it accomplished something once thought to be the sole purview of the superpowers. In truth, the ESA—a consortium of 20 formal members—highlights a well-established and accelerating trend: Whereas space was once beyond the reach of all but the United States and the Soviet Union, recent decades have witnessed the spread and maturing capabilities of new space powers around the world. While the United States has reasons to be concerned with that shift related to national security, it also has cause to celebrate, as promoting […]

As China attempts to assert maritime claims against neighboring Vietnam, Vietnam in turn has been expanding its navy and courting new allies, such as India. In an email interview, Abhijit Singh, a research fellow at India’s Institute for Defence Studies and Analyses, discusses the capabilities of the Vietnamese navy, known as the Vietnam People’s Navy. WPR: What is Vietnam’s naval capacity, and how operationally prepared is its navy? Abhijit Singh: Vietnam’s navy has modernized from a small coastal patrol force with limited capacity in the 1980s into a seagoing, fairly competent, combat-worthy navy. Equipped with old Soviet-era hardware and an […]

Whenever a U.S. president’s party experiences major losses during a midterm congressional election, there is always pressure to fire members of his team. In this particular cycle, pundits have urged President Barack Obama to consider replacing his national security adviser, Susan Rice, and Secretary of Defense Chuck Hagel, among others, as part of an effort to change course and find a new direction for his last two years in office. But staffing questions do not lie at the heart of the Obama administration’s problems. Rather, the administration has fallen short in its ability to define U.S. strategic priorities and to […]

Having returned political stability to Japan, Prime Minister Shinzo Abe today called snap elections for next month to secure a verdict on his already implemented economic policies, dubbed “Abenomics,” as well as a mandate to continue applying his strategies to expand the economy. The general elections, scheduled for mid-December, will come roughly two years after Abe was elected in a sweeping victory in December 2012. His current tenure, Abe’s second as prime minister, has been defined mainly by his efforts to jumpstart Japan’s long-beleaguered economy, focusing on a “three-arrow approach” to restore growth and confidence through increased stimulus, quantitative easing […]

U.S. Secretary of Defense Chuck Hagel recently announced a pair of important initiatives, one to restore the Defense Department’s troubled nuclear enterprise to health and another to spur innovation within the department. The two initiatives are necessary, if incomplete, but achieving both goals will difficult. Hagel’s proposed overhaul of the Defense Department’s management of its nuclear weapons enterprise is long overdue. The U.S. nuclear command’s core components, besides the actual warheads, include the Air Force’s nuclear-capable bombers and intercontinental ballistic missiles (ICBMs) and the Navy’s ballistic missile submarines as well as the supporting infrastructure for the entire system. It also […]

This year, while the eurozone’s economy is grinding to a halt, the Greek economy may be able to grow by 0.6 percent, after six years in a row of recession. Greece follows the example of other countries of Europe’s periphery, such as Portugal and Spain, which after several years of recession are at last experiencing slim growth. Having almost defaulted on its sovereign debt in 2010, Greece has been bailed out through an economic adjustment program, the implementation of which is still closely monitored by the so-called troika of the International Monetary Fund (IMF), the European Commission (EC) and the […]

After 12 years of divisive negotiations toward Economic Partnership Agreements (EPAs), the East African Community (EAC) last month became the latest African region to agree to a bilateral trade deal with the European Union. Concluding the talks was not easy, and sticking points among stakeholders remain, particularly around key African exports like Kenya’s horticultural products. The final deal has far-reaching consequences for East Africa’s economic development—not all of them good, as alternatives to such economic liberalization pacts, which critics contend favor the EU, emerge. Following the Cotonou Agreement in 2000 between the EU and African, Caribbean and Pacific (ACP) states, […]

Mexico’s recent decision to cancel a high-speed rail contract with the China Railway Construction Company (CRCC) is the latest example of the unsettled relationship between two of the largest emerging economies. In an email interview, Matt Ferchen, associate professor at Tsinghua University in Beijing and resident scholar at the Carnegie-Tsinghua Center for Global Policy, discussed China’s economic ties with Mexico. WPR: How have Mexico’s economic relations with China developed in recent years, particularly since China joined the World Trade Organization in 2001? Matt Ferchen: The takeoff in China-Latin America commercial and diplomatic relations began just about a decade ago in […]