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  • Author: Sonali Chowdhry, Gabriel Felbermayr
  • Publication Date: 02-2021
  • Content Type: Working Paper
  • Institution: Kiel Institute for the World Economy (IfW)
  • Abstract: In 2011, the EU-South Korea Free Trade Agreement (EUKFTA) entered into force. With its focus on non-tariff barriers (NTBs), it is a leading example of a deep new generation agreement. Using detailed French customs data for the period 2000 to 2016, we investigate how exporters of different size have gained from the agreement. Applying a diff-in-diff strategy that makes use of the rich dimensionality of the data, we find that firms with larger pre-FTA sizes benefit more from the FTA than firms at the lower end of the size distribution, both at the extensive (product) and the intensive margins of trade. The latter finding is in surprising contrast to leading theories of firm-level behavior. Moreover, we find that our main result is driven by NTB reductions rather than tariff cuts. In shedding light on the distributional effects of trade agreements within exporters, our findings highlight the need for effective SME-chapters in FTAs.
  • Topic: Economics, International Political Economy, Treaties and Agreements, Tariffs, Trade
  • Political Geography: Europe, South Korea, European Union
  • Author: Krševan Antun Dujmović
  • Publication Date: 02-2021
  • Content Type: Working Paper
  • Institution: Institute for Development and International Relations (IRMO)
  • Abstract: The general elections held in Montenegro on 30 August 2020 has once again drawn the attention of the Western Balkans to the smallest, measured by population, among seven nations that emerged after the breakup of the Socialist Federal Republic of Yugoslavia. This attention is due to a number of factors. Back in May of 2018 Montenegro has opened the last of the thirty-three chapters in the negotiation process with the European Union, making it a harbinger among Western Balkans nations on the path to Euro-Atlantic integrations, especially as the country had joined the North Atlantic Alliance in June 2017. Other countries in the region linger behind Montenegro – Albania and North Macedonia, both NATO members, are still waiting for the opening of the negotiations with the EU. Serbia has no intention to join NATO, and in spite of EU negotiations and ambitions, sees itself in balance between the West on one side, and Russia and China on the other. Kosovo and Bosnia and Herzegovina are far from NATO membership and have merely the status of potential candidates for EU membership. This is why all eyes of the region and of the advocates of continuation of EU enragement policy are on Montenegro. The second factor are strong historical ties of this country on the Adriatic coast with its northern neighbor Serbia. Serbian minority makes up to one third of Montenegro’s population, and the Serbian Orthodox Church (SPC- Srpska Pravoslavna Crkva) plays a vital role in Montenegrin society, as this country does not have its own autocephalous Church recognized by other Orthodox Churches in Eastern Christendom. This gives Serbia and the SPC a significant clout within borders of its southern neighbor. The third factor is the involvement of global players in this country. The United Sates has advocated strongly to include Montenegro in NATO in order to stretch the line of NATO’s southern flank in the Northern Mediterranean from the Iberian Peninsula to the west to Greece and Turkey in the east. On the other hand, Montenegro’s authorities accused Russia of meddling in the general elections held in October 2016 when the alleged coup d’état occurred on the election day. Many feared a similar scenario on the eve of 30 August 2020 election, fathoming the outbreak of riots and violence that could ignite the powder keg in the Balkans. Although none of these happened, Montenegro is not ceasing to be the subject of the geopolitical chessboard. Considering these factors, the attention of neighbors to the events in this Balkan country is understandable. The unfolding situation after the elections in which the government of Montenegro is backed by a very thin majority in the Parliament (Skupština Crne Gore) and with no clear vision nor strategy for further political and economic development of the country, is only fueling the wariness of its neighbors and of Brussels about Montenegro as a success story.
  • Topic: NATO, Regional Cooperation, Military Strategy, Elections, European Union, Transition
  • Political Geography: Europe, Balkans, Montenegro
  • Author: Katherine Peinhardt
  • Publication Date: 01-2021
  • Content Type: Working Paper
  • Institution: German Development Institute (DIE)
  • Abstract: Public spaces are an often-overlooked opportunity for urban climate adaptation. It is increasingly clear that the unique role of public spaces in civic life positions them to enhance not only physical resilience, but also to enhance the type of social cohesion that helps communities bounce back.
  • Topic: Climate Change, Social Cohesion, Resilience, Adaptation
  • Political Geography: Europe, Netherlands
  • Author: Nathalie Tocci, Riccardo Alcaro, Francesca Caruso, Silvia Colombo, Dario Cristiani, Andrea Dessì, Flavio Fusco, Daniela Huber
  • Publication Date: 03-2021
  • Content Type: Working Paper
  • Institution: Istituto Affari Internazionali
  • Abstract: Winds of change are blowing in North Africa and the Middle East. They originate from Washington, where the new Biden administration is expected to abandon its predecessor’s zerosum, erratic approach and take steps towards supporting regional balances and cooperation. Effects are visible especially in the Gulf, with the US pondering its options to re-activate nuclear diplomacy with Iran and Saudi Arabia and the United Arab Emirates grudgingly agreeing to put their feud with Qatar on ice. One way or another, these winds of change are working their way through the Levant, the Eastern Mediterranean and Libya. Admittedly, they are still feeble and can easily fade out like a morning breeze. Were that to happen, Europeans would be amongst the most affected – aside, of course, from regional populations themselves. It is now high time for the EU and its member states to leave the backseat they have (un)comfortably been sitting in for years, seize the opportunity of a cooperative US administration and work to play a more proactive role in North Africa and the Middle East commensurate with their considerable financial, diplomatic and military resources.
  • Topic: Foreign Policy, Diplomacy, Military Affairs, Finance
  • Political Geography: Europe, Middle East, North Africa, United States of America
  • Author: Simona Autolitano, Agnieszka Pawlowska
  • Publication Date: 03-2021
  • Content Type: Working Paper
  • Institution: Istituto Affari Internazionali
  • Abstract: There is currently much discussion about “digital sovereignty” in Europe. While the term encompasses very diverse connotations, it refers to a broad concept involving data, technological, regulatory and political elements. Cloud computing represents one example of the concrete materialisation of the European Union’s quest for “digital sovereignty” – especially through the development of its GAIA-X project. It is too early to assess whether or not GAIA-X will definitively help the Union to achieve this much-desired goal; however, some challenges have already emerged along the way. Looking to the future, if the EU wants to achieve “digital sovereignty”, a different strategy to the one currently under discussion will be needed.
  • Topic: Politics, Science and Technology, Sovereignty, European Union, Digital Policy
  • Political Geography: Europe, France, Germany
  • Author: Alessandro Marrone, Karolina Muti
  • Publication Date: 04-2021
  • Content Type: Working Paper
  • Institution: Istituto Affari Internazionali
  • Abstract: Europe’s missile defence is structurally linked to NATO deterrence and defence architecture, and it has to face both a worsened international security environment and an accelerating, worldwide technological innovation. Russia and China are heavily investing in new hypersonic systems which dramatically decrease the time needed to reach the target by flying mostly within the atmosphere. The US remains a global leader in the development and deployment of missile defence capabilities, including the Aegis systems which represent the cornerstone of NATO integrate air and missile defence covering the Old Continent. European countries are increasingly collaborating within the EU framework on the related capability development, primarily via the TWISTER project under the Permanent Structured Cooperation (PeSCo). Being exposed to missile threats from Middle East and North Africa and participating to allied nuclear sharing, Italy has a primary interest in upgrading its military capabilities through PeSCo, maintaining them fully integrated within NATO, and involving the national defence industry in cutting-edge procurement programmes.
  • Topic: Defense Policy, NATO, Science and Technology, European Union
  • Political Geography: United Kingdom, Europe, Turkey, France, Poland, Germany, Italy, North America, United States of America
  • Author: Francesca Ghiretti
  • Publication Date: 09-2021
  • Content Type: Working Paper
  • Institution: Istituto Affari Internazionali
  • Abstract: The debate on technological development and the unfolding fourth technological revolution tends to neglect the role of the EU, relegating it to follower status. The leadership positions are occupied by the US and China, who compete with one another for technological supremacy. Yet, despite lagging behind in some areas, the EU is better placed than is often assumed and still stands a chance of guaranteeing the delivery of a technological revolution that is not only environmentally but also socially sustainable. This is critical in proposing a model of technological development alternative to that of China, in particular, and especially in such sectors as artificial intelligence, supercomputing and digital skills.
  • Topic: Development, Science and Technology, European Union
  • Political Geography: United States, China, Europe
  • Author: Luca Franza
  • Publication Date: 04-2021
  • Content Type: Working Paper
  • Institution: Istituto Affari Internazionali
  • Abstract: Hydrogen is the most promising vector for harnessing North Africa’s largely untapped renewable energy potential. Low-carbon hydrogen produced in North Africa can play an important role in enabling the European Union and Italy to reach their increasingly ambitious decarbonisation targets as a complement to electrification and locally produced renewables. It is estimated that the EU could achieve cost savings by producing at least part of its future renewable energy needs in neighbouring high-yield regions. Italy is set to play a particularly important function as both a gateway and a catalyst for North African hydrogen exports. In turn, North Africa stands to benefit from hydrogen both as a source of revenues and as an instrument of diversification, industrialisation and local economic development. This would in turn improve social resilience, increase political stability, reduce the risk of radicalisation and limit migration flows. Italy has a particularly strong strategic interest in all of these areas, given its geographic location in the Central Mediterranean and marked exposure to social, political and security developments in North Africa. North African hydrogen could also create profitable business opportunities for several Italian companies. In sum, hydrogen can contribute to fighting climate change while preserving positive trade interdependence across the Mediterranean. Strong coordination between the private sector and policy-makers is going to be key to abate costs along the hydrogen value chain and launch successful international hydrogen trade schemes.
  • Topic: Energy Policy, European Union, Trade, Imports, Hydrogen
  • Political Geography: Europe, North Africa, Italy, Mediterranean
  • Author: Philip Remler
  • Publication Date: 04-2021
  • Content Type: Working Paper
  • Institution: Istituto Affari Internazionali
  • Abstract: Over the past decade, the Organization for Security and Co-operation in Europe (OSCE) has been returning to its origins as a Cold War–era Conference – a forum where states and blocs, often antagonistic to one another and espousing opposing ideals, can air their frictions and hostilities. The OSCE was created without legal personality and with the liberum veto of the consensus principle. These constraints stunted the growth of executive capabilities and bound the OSCE closely to the will of its participating States. That rendered most mediation efforts ineffective, especially where an OSCE state is both belligerent and mediator in the same conflicts. Peace operations have been more effective – notably the Special Monitoring Mission in Ukraine – but the same factors have tightly constrained its activity. Though all participating States committed themselves to democratic governance, rule of law and respect for human rights, these ideals failed in much of the former Soviet Union, and autocrats have used the organisation’s lack of legal personality and the consensus principle to hobble the OSCE’s efforts. If the OSCE’s participating States want it to remain an Organization, not a Conference, they must take action to secure its executive autonomy.
  • Topic: Human Rights, Peacekeeping, Democracy, Conflict, OSCE
  • Political Geography: Russia, Europe, Eurasia, Ukraine, Eastern Europe
  • Author: Flavio Fusco
  • Publication Date: 01-2021
  • Content Type: Working Paper
  • Institution: Istituto Affari Internazionali
  • Abstract: Building on emerging debates on the need to develop de-escalation mechanisms for the Middle East, the Istituto Affari Internazionali (IAI) and the Brussels-based Foundation for European Progressive Studies (FEPS), with support from the Italian Ministry of Foreign Affairs and International Cooperation, launched a one-year research and outreach project entitled “Fostering a New Security Architecture in the Middle East”. Connected to the research, an expert survey targeting European, US, Russian, Middle Eastern and Chinese experts and practitioners was conducted on key themes, principles and approaches associated with a potential new security architecture for the region. The results of the survey – first published in an edited book volume jointly published by IAI and FEPS in November 2020 – are analysed below, complete with tables and infographics on key themes associated with the research project and the search for new, inclusive mechanisms for dialogue and de-escalation in the Middle East.
  • Topic: Conflict Prevention, Security, Foreign Policy, Politics
  • Political Geography: Russia, China, Europe, Middle East, United States of America