Economics & Business Archive

On Oct. 18, the foreign ministers of Niger and Nigeria signed a defense pact in Niger’s capital, Niamey, establishing joint border patrols along their 930-mile border. The pact also envisions infrastructure projects, including road construction and potential rail links to connect the two countries, as well as renewed efforts to re-demarcate the border. President Mahamadou Issoufou of Niger announced the deal in a French-language Twitter post on Oct. 24, declaring that, from now on, “whoever attacks Niger, attacks Nigeria.” In the communiqué launching the pact, both countries’ heads of state, Issoufou and Nigerian President Goodluck Jonathan, expressed their concern about […]

Tanzania is lobbying to be allowed to make a one-off sale of its ivory stockpile ahead of the annual meeting of the Convention on International Trade in Endangered Species (CITES). In an email interview, Esmond Martin, an independent wildlife trade consultant, discussed the ivory trade regime. WPR: What is the CITES decision-making process on issues like Tanzania’s request for a one-off sale of its ivory stock? Esmond Martin: The present CITES decision-making process concerning Tanzania’s request for a one-off sale of ivory consists of a panel of experts put together by CITES to visit Tanzania to check how effective the […]

In the most recent presidential debate, Republican nominee Mitt Romney attempted to tap into a deep-rooted fear among the American public of instability in the Middle East, and in particular the concern that any resulting oil supply disruption would spike oil prices and trigger a recession. The concern is historically based: Past recessions have been caused or accelerated by such crises, including the 1973 oil embargo, the 1979 Iranian revolution and the 1980 outbreak of the Iran-Iraq war. Contrary to received wisdom, however, the chance of an oil crisis caused by a hard-to-manage oil disruption has decreased substantially since the […]

Belarusian President Alexander Lukashenko threatened last week to allow illegal migrants into the European Union in retaliation for new sanctions the bloc has placed on his country. In an email interview, Jana Kobzova, a policy fellow and coordinator of the Wider Europe Program at the European Council on Foreign Relations, discussed EU policy toward Belarus. WPR: What is the current state of political and economic relations between the EU and Belarus? Jana Kobzova: Icy is the word that best describes the political relationship between the two today. Relations were mildly better in 2009-2010, when the two sides talked about expanding […]

Critical assessments of Mexico’s oil industry in general and of its state-owned oil company, Pemex, in particular are commonplace, often with good reason: Both face many challenges in overcoming the historical legacies that have long undermined their performance. Nevertheless, when President Felipe Calderon’s term in office ends on Dec. 1, he will be leaving both in better shape than when his presidency began six years ago. True, there have been strategic misfires under his administration. Pemex’s opaque expenditure of almost $2 billion for an increased stake in Spanish oil company Repsol stands out, both for the lack of strategic oversight […]

On Monday, during the final presidential debate, President Barack Obama proclaimed that his defense budgets were “driven by strategy. [They’re] not driven by politics.” In theory, Obama is correct. Defense budgeting is supposed to be a rational exercise that assesses threats and needs, and then fills in the gaps. As Sean Sullivan, a leading expert on defense resource allocation issues at the Naval War College, told me in a conversation on the subject, “Defense planning processes are specifically designed to use strategy as guidance for force programming and budget decisions, thereby linking the ends with the means.” In practice, however, […]

Following considerable speculation that it would be postponed or even cancelled, the 18th National Congress of the Chinese Communist Party (CCP) will convene in Beijing on Nov. 8. The meeting marks the beginning of the final leg of China’s extended leadership transition process and should give greater clarity on China’s direction in the coming decade. Over the past two years, China’s intricate and opaque leadership structure has been shaken to the core by a series of high-profile political scandals amid elevated economic uncertainty. Major disagreements on how to respond to these challenges have riven elite groups, and the factional coalition […]

When Mitt Romney vowed during the last presidential debate that, if elected president, he would push for an indictment by the International Criminal Court of Iranian President Mahmoud Ahmadinejad, some of the most powerful people in Tehran surely flashed a smile. Romney argued that Ahmadinejad’s long history of provocative statements regarding Israel and the Jews “amount to genocide incitation,” an indictable offense under international conventions. Of course, the Republican presidential nominee was really trying to convince American voters that he would be tougher on Iran than President Barack Obama. The tactic of targeting Ahmadinejad, however, would only please much of […]

In late-September, Sen. Joe Lieberman detailed a significant and sustained Iranian attack on U.S. banks in retaliation for the Stuxnet virus, which the U.S. all but admitted had been used to attack Iran’s nuclear program. In October, Rep. Mike Rogers, chairman of the House Permanent Select Committee on Intelligence, spoke circumspectly about a new cyberthreat from an “unusual source.” Then, on Oct. 11, Secretary of Defense Leon Panetta warned of America’s unpreparedness for a major cyberattack, raising the specter of a cyber Pearl Harbor. The message was clear: The United States is engaged in a cyber conflict. Alarmingly, however, the […]

In a reshuffling of the constituencies that elect board members at the International Monetary Fund, Colombia has left a group led by Brazil for one led by Mexico, while Western European countries opted to give more say to smaller European economies. In an email interview, Edwin M. Truman, senior fellow at the Peterson Institute for International Economics, discussed the changes in IMF constituencies. WPR: What prompted the reshuffling of voting groups at the IMF? Edwin M. Truman: The reshuffling of voting groups, or constituencies, on the 24-seat IMF executive board was prompted by two developments. First, at the Seoul G-20 […]

In George Lucas’ dystopian 1971 film, “THX-1138,” the protagonist is pursued by police after attempting to escape from a futuristic totalitarian city-state. However, the city has only budgeted a certain amount to cover the costs of the pursuit. In the penultimate scene, as the officers are about to recapture the renegade, the comptroller’s office informs them that because of cost overruns, the chase is to be terminated. “Economics make it necessary to terminate any operation which exceeds five percent of its primary budget,” the officers are told. With the specter of sequestration — which on Jan. 1, 2013, is set […]

Secretary of Defense Leon Panetta’s recent address to the Business Executives for National Security conference in New York revisited an old metaphor of the cybersecurity game: a Pearl Harbor-esque surprise attack on the nation’s computer systems. Though the fears that Panetta invoked of a massive cyber attack on the United States may be overblown, there are valid reasons for concern. As Panetta highlighted, foreign powers are increasingly going on the offensive in cyberspace, with two of the world’s most important industries, energy and banking, recently coming under assault. His speech signals that, for the Department of Defense, cyberattacks have likely […]

Irish President Michael Higgins visited Argentina, Brazil and China this month in an effort to boost economic ties with the region. In an email interview, Frank Barry, chair of international business and economic development at Trinity College Dublin, discussed Ireland’s trade strategy. WPR: What are the key sectors and partner countries for Irish trade? Frank Barry: One needs to distinguish between exports of Irish-owned (indigenous) companies and those of the foreign multinational corporations (MNCs) that use Ireland as an export platform from which to sell primarily into the European Union. Some 80 percent of total Irish exports are accounted for […]

Argentina’s legacy of debt default is back in the headlines this week after a Ghanaian port detained an Argentine navy ship, executing a court order on behalf of the country’s creditors. The bondholders who seized the ship said they do not plan to release it until Argentina repays at least $20 million of the $300 million they are owed on defaulted debt. This is the latest example of creditors — often vulture funds that purchased discounted bonds discarded by investors after Argentina stopped honoring its debts during its economic free fall 10 years ago — trying to seize the country’s […]

As India continues to grow, the recent slowdown notwithstanding, its need for natural resources shows no signs of ebbing. With New Delhi increasingly turning to resource-rich developed countries for energy and food security, Canada’s profile in particular seems to have grown considerably. Significant unconventional hydrocarbon resources, high-quality uranium deposits, abundant land and a lack of geopolitical risk all make Canada a natural partner to feed India’s rise. However, there are still some issues that need to be resolved before an even deeper relationship can take root. The outlook was not always so rosy. Canada was the first country to withdraw […]

Recent years have witnessed a significant increase in both labor disputes and regulatory burden in the resources sector across the world. The ongoing mining sector unrest in South Africa, marked by widespread wildcat action and shocking levels of violence, suggests that these pressures continue to mount and that previous policy responses may prove insufficient. Moreover, there is a risk that the disorder seen in South Africa may presage a new, even more contentious phase of global resource exploitation characterized by a higher incidence of resource nationalism in both developing and developed economies. Resource nationalism can take many forms (.pdf). At […]

In a decision that came as a surprise to most, the European Union was awarded the Nobel Peace Prize last week. The announcement quickly shifted attention from a development that had dominated the European news just days before: the failed merger between defense giants EADS and BAE, which could also be considered the death knell of strategic Europe. In light of this missed opportunity for Europe to rise to a global defense role, some observers had only cynical remarks for the prestigious peace award. The failed EADS-BAE merger marks the second unsuccessful effort since 1997 to move the European defense […]