Economics & Business Archive

On Oct. 11, Iranian Oil Minister Massoud Mir Kazemi announced a reassessment of the country’s oil reserves, increasing them by 9 percent to 150.31 billion barrels, from the previous official figure of 138 billion barrels. The announcement closely followed a similar move by Iraq, which had a week earlier raised its proven reserves by one-quarter — to 143 billion barrels — allowing Iraq to temporarily overtake Iran as the world’s third-largest oil-reserve holder. The back-to-back announcements do not signal the discovery of new oil in the Middle East, however. As Iranian and Iraqi subsoil resources have been extensively surveyed over […]

The Nobel Committee’s decision to award jailed Chinese democracy activist Liu Xiaobo the 2010 Peace Prize came just days before China’s Communist Party elite anointed political princeling Xi Jinping as President Hu Jintao’s clear successor, highlighting the two Chinas that now seem to be passing one another like ships in the night. One China is propelled from below by a coastal workforce that is increasingly self-confident in its skills and accomplishments and growing income. The other, larger China is managed from above by political leaders who increasingly worry over the nation’s social stability as they grow more self-defensive in their […]

Space-based solar power (SBSP) may soon emerge as one of the leading sectors of strategic cooperation between India and the U.S., with a recently released report (.pdf) authored by U.S. Air Force Lt. Col. Peter A. Garretson making the case for it being the next focus of the growing partnership. There are a number of reasons why SBSP may emerge as the hub for strategic industrial coordination between the two countries. First, neither country can meet its energy needs through existing clean-energy technologies, including nuclear power, and various technological advances over the past few decades have made space-based solar power […]

The news that Turkey and China had organized a joint military exercise at the huge Konya airbase in Turkey’s central Anatolian region last month came as a surprise to many. After all, just a year ago, when clashes between Uighur and Han Chinese broke out in China’s Xinjiang province in July 2009, Turkish Prime Minister Recep Tayyip Erdogan accused Chinese authorities of mishandling a situation that he compared to “genocide.” What explains such a dramatic improvement in relations between Turkey and China? And how should this military exercise be understood in the context of the current shifts taking place in […]

When the Nobel committee selected Liu Xiaobo as the winner of this year’s Nobel Peace Prize, the distinction brought unwanted attention to China. For obvious reasons, Beijing did not want the world honoring a man who has dedicated decades to challenging the country’s political system. But Beijing, in fact, seems uncomfortable with any kind of attention. Earlier this year, when the Chinese economy overtook Japan’s to become the second-largest in the world, Chinese officials seemed determined to downplay what is by any measure an impressive achievement, declaring that the rising Chinese powerhouse remains “a developing country.” To be sure, China […]

With nations scouring the globe in pursuit of dwindling mineral supplies, the world’s attention has shifted to Mongolia, a country some are heralding as the next resource success story. Among the last places on earth with rich, untapped mineral deposits, this landlocked, underdeveloped country is expected to become one of the world’s fastest-growing economies over the next decade — if, that is, it can address a set of daunting challenges and bring these resources to the market. According to some estimates, there is about $1.3 trillion worth of untapped coal, gold, silver, copper, uranium and zinc deposits in what is […]

Although Dilma Rousseff failed to secure an absolute majority in the first round of Brazil’s presidential election, she seems certain to beat her rival Jose Serra in the run-off voting on Oct. 31 to become Brazil’s first female president. As current President Luiz Inacio Lula da Silva’s hand-picked successor, Rousseff represents policy continuity, and her likely victory shows the degree to which Brazilians are happy with the track their country is on. Yet one disturbing issue has been largely overlooked by both domestic and international commentators during the election campaign: Since 2004, Brazil has refused to grant inspectors from the […]

Since the financial crisis broke in 2008, the United Nations Security Council has looked like a poor relation to the newly empowered Group of Twenty (G-20). While world leaders tackled the crisis at biannual G-20 summits, ambassadors in New York got on with the daily grind of reviewing peace operations and routinely condemning far-flung atrocities. The council has occasionally been in the limelight, not least during this summer’s tortuous negotiations over new sanctions on Iran. But a top-level meeting on the council’s role convened by Turkey this September was an illustrative bore, producing a statement calling for a “continuous process […]

On Oct. 20, Iraq will embark on the next phase of development of its hydrocarbon sector by auctioning rights to three natural gas fields to private investors. For Baghdad, the success of this bid round, the third in the last two years, will go some way toward determining its ability to address Iraqi citizens’ concerns over power shortages. For outsiders, including many in European capitals and Washington, the comprehensive development of the Iraqi gas sector offers hope that in the medium term, Iraqi gas could begin to compete directly with Russian gas in the European market. The fields on offer […]

The ebullient celebration in Brazil over Petrobras’ historic $70 billion share-issue last month was bitterly received in Mexico City, where the state-owned oil company Pemex is mired in debt, inefficiency and ongoing political wrangling. With little having changed since Mexican President Felipe Calderón sought to reform the country’s energy sector two years ago, the contrast between Petrobras’ successes and Pemex’s failures has reignited discussion of Pemex’s future and renewed the public’s interest in the beleaguered Mexican oil giant. Once Latin America’s largest company, Pemex has persistently lost profits and market share to other state-led oil companies, including PetroChina, Russia’s Lukoil, […]

It is hard for most Americans to fathom why the U.S. military should be involved in either Afghanistan or northwest Pakistan for anything other than the targeting of terrorist networks. And since drones can do most of that dirty work, few feel it is vital to engage in the long and difficult task of nation-building in that part of the world. These are distant, backward places whose sheer disconnectedness relegates them to the dustbin of globalization, and nothing more. If only that were true. But as globetrotting journalist Robert D. Kaplan makes eminently clear in his new book, “Monsoon: The […]

Last week India and Russia finalized plans to deliver 250 to 300 jointly developed fifth-generation fighter aircraft (FGFA) and 45 multirole transport aircraft (MTA) to India over the next decade. The Indian defense minister underlined that these would be the flagship Indo-Russian joint development projects, building on the success of the Brahmos cruise missile program as a model. Some wrinkles remain in the two countries’ defense partnership. India raised the issue of inordinate delays in the delivery of Russian defense systems, which result in considerable cost escalation. For instance, India will end up paying Russia $2.34 billion for the delivery […]

In advance of President Barack Obama’s visit to India next month, the administration is sending signals about great and wondrous changes ahead in the Indo-American relationship. But in reading Lalit K. Jha’s dispatch from Washington, a term I have come to dread in foreign policy rhetoric made its predictable appearance: Obama’s visit is supposed to herald the establishment of a “true strategic partnership.” “Strategic partnership” entered the U.S. diplomatic lexicon as a way to find a halfway house between those countries that are formal American allies — especially those for whom this status is a matter of treaty and Congressional […]

BEIJING — Urban legend tells of an American businessman who, visiting a factory in China’s Guangdong Province, witnesses working conditions forbidden by Chinese law. When he inquires about them, the factory owner replies sharply, “Laws made in Beijing mean nothing in Guangdong.” Though apocryphal, the story reflects the localism and institutional inconsistency that are core aspects of the modern Chinese economy. Mao Zedong’s attempts to bring centralization and uniformity to an economic system of continental proportions resulted in paralysis. In the reform era, previously suppressed network connections have regenerated quickly, resulting in increasing heterogeneity and even fragmentation within the economic […]

While Western diplomats and sanctions-enforcers ply their trade to pressure Iran into stopping its uranium enrichment, much of the Middle East is already preparing for war. Headlines might focus on United Nations resolutions initiated by Western powers, or on fiery speeches delivered by Iranian President Mahmoud Ahmadinejad. But just a few hundred miles from Tehran, the Arab countries of the Persian Gulf have launched a race to arm themselves with an urgency and intensity reminiscent of America’s defense build-up prior to its entry into World War II. The magnitude of the weapons purchases is nothing short of astounding and the […]

Deputy Secretary of Defense William Lynn recently caused a stir in official Washington by publicly confirming that the Pentagon had suffered a massive computer breach in 2008. A foreign intelligence service successfully slipped an infected flash drive into a Central Command computer. The drive contained software that surreptitiously spread through both classified and unclassified government networks, establishing a “digital beachhead, from which data could be transferred to servers under foreign control.” According to Lynn, “it was a network administrator’s worst fear.” In addition to confirming the breach, Lynn previewed the Defense Department’s cyber strategy, expected to be finalized by the […]

In his 1996 classic, “The Clash of Civilizations,” Samuel Huntington characterized Mexico as a “torn country” — a condition produced by the Westernizing instincts of its elites pulling against the weight of its cultural heritage. Today, however, Mexico is not torn by internal discord, its drug violence notwithstanding. Rather, it is trapped — caught between dynamic global trends washing over Latin America on one hand, and the dogged political realities of North America on the other. In heralding the end of trade barriers between Mexico, the United States and Canada, the North American Free Trade Agreement (NAFTA) cast modern Mexico’s […]