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58061. Balancing act: Taiwan's cross-strait challenge

Author:
Malcolm Cook and Craig Meer
Publication Date:
04-2005
Content Type:
Working Paper
Institution:
Lowy Institute for International Policy
Abstract:
Taiwan is in the middle of a deep social transformation that is redefining the way its people identify themselves, how it sees its place in the world and, most urgently, its relationship with China. Taiwan's metamorphosis, and China's reaction to it, are making it more difficult to maintain peace across the Taiwan Strait. Washington and its regional allies, including Australia, need to understand these changes better and to incorporate responses to them into their policies.
Topic:
International Relations and Democratization
Political Geography:
China, Washington, Taiwan, Asia, and Australia

58062. Australians speak 2005: public opinion and foreign policy

Author:
Ivan Cook
Publication Date:
03-2005
Content Type:
Working Paper
Institution:
Lowy Institute for International Policy
Abstract:
Australians feel positive and self-confident about Australia's place in the world, but we also have a realistic sense of our limitations and vulnerabilities. A vast majority believe Australia is 'a good international citizen' (82%), 'important in Asia' (82%), and 'well-placed to succeed in a competitive world' (79%), while few agree with the notion that we are 'unimportant in global politics' (37%). But three quarters of respondents also think we are 'vulnerable to external threats' (76%), and while the population is evenly split on whether we are 'independent minded', 65% think we are 'a follower not a leader'.
Topic:
International Relations, Foreign Policy, and Defense Policy
Political Geography:
Asia, Australia, and Australia/Pacific

58063. Sensible climate policy

Author:
Warwick McKibbin
Publication Date:
02-2005
Content Type:
Policy Brief
Institution:
Lowy Institute for International Policy
Abstract:
The Kyoto Protocol enters into force on February 16, 2005. Nearly thirteen years after negotiations began at the Rio Earth Summit and seven years after the Kyoto Protocol was negotiated, this should be a cause for global celebration. Yet the basic tenets on which the Kyoto Protocol are built are flawed and leave it worryingly vulnerable to failure. Already proponents of Kyoto are looking for alternatives “beyond Kyoto”. It is no accident that it has taken so long for the Protocol to enter into force with so few of the major future greenhouse emitters effective participants.
Topic:
International Relations, Energy Policy, and Environment
Political Geography:
Australia/Pacific

58064. Beyond Arafat

Author:
Anthony Bubalo
Publication Date:
11-2005
Content Type:
Policy Brief
Institution:
Lowy Institute for International Policy
Abstract:
Arafat may have suffered a lingering physical demise, but politically he has long been in decline. He lost much of his international credibility over his unwillingness to rein in Palestinian terrorism against Israel, and domestically his authority had gradually been eroded. While lacking an anointed heir, a succession plan is more or less in place. Political infighting is a possibility, though a desire for unity will probably prevail in the short term. But Arafat's successors will struggle to end the chaos and lawlessness into which the West Bank and the Gaza Strip have descended. Over the longer term Arafat's passing will remove the main obstacle to internal Palestinian reform. It has the potential to re-invigorate the peace process although it will not solve the fundamentals of the current impasse. It will also complicate Israeli Prime Minister Ariel Sharon's plans for a unilateral withdrawal from Gaza and parts of the West Bank, even if his instinct will be to press ahead.
Topic:
Conflict Resolution, Development, and Government
Political Geography:
Middle East

58065. Living with Global Imbalances: A Contrarian View

Author:
Richard N. Cooper
Publication Date:
11-2005
Content Type:
Policy Brief
Institution:
Peterson Institute for International Economics
Abstract:
Three propositions have become conventional wisdom in Washington and elsewhere. Americans save too little. As a consequence, the US current account deficit is unsustainably large. A necessary step to bring the global economy into sustainable balance is a significant appreciation of the Chinese currency, which in practice has been fixed to the dollar for over a decade.
Topic:
International Relations, Development, Economics, and Globalization

58066. After Argentina

Author:
Anna Gelpern
Publication Date:
09-2005
Content Type:
Policy Brief
Institution:
Peterson Institute for International Economics
Abstract:
Argentina has finally restructured its foreign debt. Its credit rating is up, and its debt is back in the index. The new bonds are trading roughly in line with Brazil and Uruguay's, just above 400 basis points over treasuries for instruments of comparable duration. Argentina is raising new money from foreign investors. Earlier in the summer of 2005, it reopened a domestic dollar issue to accommodate excess foreign demand. Argentina and the International Monetary Fund (IMF) are on again. They might even sign a new disbursing program after the fall 2005 congressional elections. Like a bad dream, the 2001 default is fading into the night after three years of brisk growth and impressive fiscal management—even as the usual nabobs natter on about structural reform and unhappy bondholders.
Topic:
International Relations, Debt, and Economics
Political Geography:
South America

58067. A Currency Basket for East Asia, Not Just China

Author:
John Williamson
Publication Date:
08-2005
Content Type:
Policy Brief
Institution:
Peterson Institute for International Economics
Abstract:
China recently announced that it is adopting a basket of currencies as the peg for its exchange rate instead of the US dollar. This announcement raises questions of how such a system works, whether other East Asian countries would be advised to follow China in adopting a basket numeraire, and whether it would be advantageous to these countries if they were all to adopt the same basket. This brief answers these questions.
Topic:
Economics, International Cooperation, and International Trade and Finance
Political Geography:
United States, Israel, East Asia, and Asia

58068. Predicting Trade Expansion under FTAs and Multilateral Agreements

Author:
Dean A. DeRosa and John P. Gilbert
Publication Date:
10-2005
Content Type:
Working Paper
Institution:
Peterson Institute for International Economics
Abstract:
This paper examines the historical record of eight recent free trade agreements (FTAs). It also investigates the predictive power of two popular quantitative world trade models—the single-equation gravity model and the multiequation computable general equilibrium (CGE) model—as applied to three major trade liberalization agreements adopted during the 1990s: Mercosur, NAFTA, and the Uruguay Round Agreement, using the Rose gravity model and the GTAP general equilibrium model. Both models are found accurate in some instances, but intervening influences in the wake of trade liberalization episodes confound the challenge of drawing a strong conclusion in favor of one modeling approach over the other. Between the "naïve" gravity model and "naïve" CGE model predictions, we find that the former tends to overpredict intrabloc trade expansion (especially over horizons of five years and less) while the latter tends to underpredict. CGE models remain favored for ex post analysis of welfare impacts and the direct and indirect linkages between policy reforms and the numerous other economic variables of concern to policymakers and the public at large.
Topic:
Development, Economics, International Trade and Finance, and Treaties and Agreements

58069. Prospects for Regional Free Trade in Asia

Author:
Gary Clyde Hufbauer and Yee Wong
Publication Date:
10-2005
Content Type:
Working Paper
Institution:
Peterson Institute for International Economics
Abstract:
Frustrated with lackluster momentum in the WTO Doha Round and the Asia Pacific Economic Cooperation (APEC) forum, and mindful of free trade agreement (FTA) networks centered on the United States and Europe, Asian countries have joined the FTA game. By 2005, Asian countries (excluding China) had ratified 14 bilateral and regional FTAs and had negotiated but not implemented another seven. Asian nations are also actively negotiating some 23 bilateral and regional FTAs, many with non-Asian partners, including Australia, Canada, Chile, the European Union, India, and Qatar. China has been particularly active since 2000. It has completed three bilateral FTAs—Thailand in 2003 and Hong Kong and Macao in 2004—and is initiating another 17 bilateral and regional FTAs. However, a regional Asian economic bloc led by China seems distant, even though China accounts for about 30 percent of regional GDP. As in Europe and the Western Hemisphere, many Asian countries are pursuing FTAs with countries outside the region. On present evidence, the FTA process embraced with some enthusiasm in Asia, Europe, and the Western Hemisphere more closely resembles fingers reaching idiosycratically around the globe rather than politico-economic blocs centered respectively on Beijing, Brussels, and Washington.
Topic:
Economics, International Trade and Finance, and Regional Cooperation
Political Geography:
United States, China, Europe, Washington, Canada, India, Beijing, Asia, Australia, Qatar, Chile, Hong Kong, Brussels, and Macao

58070. The US Trade Deficit: A Disaggregated Perspective

Author:
Catherine L. Mann and Katharina Plück
Publication Date:
09-2005
Content Type:
Working Paper
Institution:
Peterson Institute for International Economics
Abstract:
The paper prepares new estimates for the elasticity of US trade flows using bilateral, commodity-detailed trade data for 31 countries, using measures of expenditure and trade prices matched to commodity groups, and including a commodity-and-country specific proxy for global supply-cum-variety. Using the United Nations Commodity Trade Statistics Database (UN Comtrade) we construct bilateral trade flows for 31 countries in four categories of goods based on the Bureau of Economic Analysis's "end-use" classification system--autos, industrial supplies and materials-excluding energy, consumer goods, and capital goods. We find that using expenditure matched to commodity category yields more plausible values for the demand elasticities than does using GDP as the measure of demand that drives trade flows. Controlling for country and commodity fixed effects, we find that industrial and developing countries have demand elasticities that are statistically significant and that generally differ between development groups and across product categories. Relative prices for the industrial countries have plausible parameter values, are statistically significant and differ across product groups, but the relative prices for developing countries are poorly estimated. We find that variety is an important variable for the behavior of capital goods trade. Because the commodity composition of trade and of trading partners has changed dramatically, particularly for imports, we find that the demand elasticity for imports is not constant. Comparing the in-sample performance of the disaggregated model against a benchmark that uses aggregated data and GDP as the expenditure variable, our disaggregated model predicts exports better in-sample but does not predict imports as well as the benchmark model.
Topic:
Development, Economics, and International Trade and Finance
Political Geography:
United States