Economics & Business Archive

MADRID — Spain’s six-month rotating presidency of the European Union, which began on Jan. 1, 2010, is off to a bumpy start. With the Lisbon Treaty now in effect, the traditional role of the EU rotating presidency has been downgraded. Responsibility for many issues which were once the domain of the rotating presidency now falls to the newly named permanent EU president, Herman Van Rompuy, and EU foreign minister, Catherine Ashton — who together are supposed to comprise the new “public face” of the EU. Nevertheless, Spanish Prime Minister José Luis Rodríguez Zapatero has announced a series of ambitious initiatives […]

Just 12 days into 2010, Chinese government representatives have already made more than a half-dozen official statements warning the Obama administration against selling additional weapons to Taiwan. The People’s Republic of China (PRC) may respond in several ways to the announced sales, with the freezing of Sino-American military relations likely to be one means of retaliation. The Obama administration should accept a temporary suspension to educate Chinese policymakers that the defense dialogue is not something that Beijing can employ as a source of leverage over Washington. The immediate catalyst for Beijing’s anger came on Dec. 23, when the Defense Department […]

The U.S.-India civilian nuclear agreement, signed in October 2008 after intense bilateral negotiations, is a crucial trade deal for both nations, offering India’s fledgling civilian nuclear industry the opportunity to access sophisticated U.S. technology, while providing American companies with the possibility of significant commercial benefits from the engagement. However, despite the deal’s obvious benefits and the urgency displayed by both countries to get it signed over a year ago, obstacles still remain to making it operational. To finalize the agreement, the Bush administration overruled longstanding U.S. non-proliferation policy by implicitly recognizing India as a nuclear power. The deal was also […]

Thanks to the recent global financial crisis, we’ve heard much talk about the coming “de-globalization,” defined by some as the reversal of the now decades-long push to further integrate trade among national economies by disintegrating production and spreading its means across the planet to the cheapest sources. In the past, all forms of growing supply chain connectivity could be justified on price, buttressed by just-in-time delivery capacity. But the market woes of the last year-and-a-half supposedly threw all that logic into question. Price risk is one thing, supply risk quite another. Specialization depends on supply: the greater the specialization, the […]

The chaos in Copenhagen offered a powerful, and sobering, illustration of how far the world’s governments are from negotiating an accord to bring climate change under control. Those who believe that a robust and binding climate framework is essential have been left depressed and demoralized. Many now fear that a global governance system that is unable to respond to one of the toughest threats the world faces must, in fact, be broken. History suggests (.pdf) that the climate change priesthood will soldier on, insisting that a deal needs just one more push. Meanwhile, they’ll bury the process ever further in […]

Last month, the West officially lost the new “Great Game.” The 20-year competition for natural resources and influence in Central Asia between the United States (supported by the European Union), Russia and China has, for now, come to an end, with the outcome in favor of the latter two. Western defeat was already becoming clear with the slow progress of the Nabucco pipeline and the strategic reorientation of some Central Asian republics toward Russia and China. Two recent events, however, confirmed it. On Dec. 14, Chinese President Hu Jintao and the heads of state of Turkmenistan, Uzbekistan and Kazakhstan personally […]

Chile’s left-wing Concertación coalition might very well lose the presidency for the first time since the country’s return to democracy in 1990. But don’t blame outgoing President Michelle Bachelet. With record-high approval ratings, Bachelet would be a shoe-in for a second term, if not for the constitutional prohibition on consecutive re-election. Instead, as the country’s first woman president and, before that, its first woman defense minister, Bachelet will undoubtedly be remembered for breaking the gender barrier to Chile’s most powerful positions. She also appointed equal numbers of men and women to her cabinet when she took office in 2005. Subsequent […]

President Barack Obama tried his best to avoid it, but the moment has now arrived when he has no choice but to impose new sanctions on Iran. The challenge now is to find the formula that will prove effective in pressuring the regime without undermining Iranian protesters who have risked their lives to demand change. Obama’s commitment to use diplomacy in dealing with Iran became a cornerstone of the foreign policy approach he constructed during his presidential campaign. He vowed to use fair-minded negotiations, a respectful tone, and reasonable arguments to convince the Islamic Republic to stop enriching uranium in […]

Analysts have long wondered if the Chinese navy (PLAN) had a third island chain strategy, beyond the publicly declared strategies for the first island chain (centered on Taiwan) and second island chain (extending from Japan to Indonesia). Many American commentators believed that such a strategy would refer to the ability to project power capable of reaching America’s bases in Hawaii. However, China’s recent maritime activities — such as its extended counterpiracy patrols in the Horn of Africa and its involvement in a number of port development projects in Indian Ocean littorals (dubbed the “string of pearls”) — have raised the […]

The governments of the United States and its NATO allies routinely characterize Afghan President Hamid Karzai as corrupt and incompetent. These unjust accusations come after the West grossly mishandled Karzai for years, often placing damaging and contradictory pressures on him since he assumed the presidency in 2004. Karzai’s recent decision to expel two ministers tarnished by graft allegations is a positive sign of his efforts to improve the effectiveness and transparency of his administration, one that warrants recognition from the often-critical international community as a concrete example of good governance. The silence from the West following these firings speaks volumes […]

Immediately after President Barack Obama announced on Dec. 1 that he would deploy 30,000 additional U.S. troops to Afghanistan, NATO Secretary-General Anders Fogh Rasmussen declared that the alliance would also step up with a miniature surge of its own. While Rasmussen’s announcement may have been a deft political move, many of the 7,000 troops he cited were pledged well in advance of Obama’s West Point speech, with some of those forces already on the ground. Also, the figure does not take into account planned near-term withdrawals by frontline contributors like the Netherlands and Canada. Finally, although the specific country-by-country breakdown […]

Over the New Year’s holiday, the Chinese government launched yet another trial balloon to test international reaction to its expanding military reach. The move came in the form of an interview reproduced by the Defense Ministry’s Web site, in which a retired admiral called for China to acquire its first permanent overseas naval base. Although the ministry quickly distanced itself from the proposal, we can expect to see further expressions of Chinese interest in acquiring naval bases in coming years. On Dec. 30, the Defense Ministry’s Web site posted the interview with Adm. Yin Zhuo, who often comments on China’s […]

Introduction In recent years, Ghana has made impressive progress with regards to socio-economic and political development. This has lead to contemporary Western media and international donors portraying the country not merely as a success story, but as a model for Africa. While some elections in Africa have been followed by violent conflicts and other political struggles, Ghana has held five relatively peaceful and successful national elections between 1992 and 2008, including two that resulted in an alternation of power between parties. In particular, to the extent that the ruling New Patriotic Party (NPP) lost the December 2008 presidential election by […]

In 1980, the controversial U.S. diplomat for Africa, Chester Crocker, memorably described South Africa as a “magnet for one-dimensional minds.” The accuracy of that assertion has been confirmed over the course of the post-1994 democratic era, during which mood swings among both the commentariat and the wider populace have caused South Africa to be viewed from several, radically contrasting, but ultimately one-dimensional perspectives. Between 1994 and 1999, under the presidency of Nelson Mandela, South Africa was routinely described as a “miracle,” a country that had somehow managed to navigate the treacherous waters of the transition from apartheid, while putting in […]

In “The United States of Africa,” the Djibouti-born novelist Abdourahman Waberi imagines a topsy-turvy world where a sorry stream of refugees flows from the squalor of Europe and America to escape poverty in the prosperous United States of Africa. Like an African Voltaire, Waberi uses the weapon of satire to raze a Western myth that has come to imprison Africans: that of the eternal African victim. Ironically, this myth of African victimhood emerged in Western political thought at the same moment that Africa achieved political liberation. As the French writer Pascal Bruckner trenchantly described in “The Tears of the White […]

Political pundits across America seem committed to the notion that our just-concluded decade deserves the moniker “worst ever,” with the formulations ranging from Time’s demonic “decade from hell” to Paul Krugman’s self-flagellating “Big Zero.” But if Krugman could call it “a decade in which nothing good happened,” much of the planet might find our myopic bitterness a bit much — as if the entire world should stop spinning just because the Dow Jones Industrial Average forgot to exit the decade higher than when it entered. Why are we so convinced that the last 10 years, the decade of the Naughts, […]

PHNOM PENH, Cambodia — Two days after Cambodia repatriated 20 Uighur asylum-seekers fleeing China, the two countries signed trade agreements worth more than $1 billion, bringing significant investment, loans and grants to the impoverished Southeast Asian nation. Both countries deny a deal was struck, but China’s growing ability to leverage its economic power in the region combined with Cambodia’s weak rule of law have observers believing otherwise. China insisted the Uighurs were outlaws, saying they participated in deadly protests earlier this year, while Cambodia contended it was merely following its immigration laws by deporting them. Rights advocates, however, said the […]