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2201. Drivers of FDI in the EU: Regulatory distance and revealed technological advantage

Author:
Chiara Castelli, Ronald B. Davies, Javier Flórez Mendoza, and Mahdi Ghodsi
Publication Date:
06-2025
Content Type:
Working Paper
Institution:
The Vienna Institute for International Economic Studies (WIIW)
Abstract:
This study examines the interplay between trade policy, in particular non-tariff measures (NTMs), and revealed technological comparative advantage (RTA) at the NUTS 2 level as drivers of foreign direct investment (FDI) over time. Combining data from the Orbis database (Bureau Van Dijk), the NTMs database (WTO I-TIP) and the European Patent Office (EPO PATStat), we construct a comprehensive panel database of European firms owned by foreign-owned EU and non-EU firms. This database includes financial information for both parent companies and their subsidiaries as well as detailed country- and sector-specific trade barriers from the perspective of both the home and host economies. Furthermore, this database allows us to compute tailored RTA variables reflecting firm-specific technological interests proxied by firms’ patent production across technology classes. Using a Poisson pseudo-maximum likelihood (PPML) estimator, our analysis reveals a heterogeneous impact of NTMs and RTAs on FDI investment in the EU regions. Specifically, while increasing the regulatory distance (RD) of technical barriers to trade (TBTs) and sanitary-and-phytosanitary-standard (SPS) measures hampers FDI investment from extra-EU companies, the results on tariffs support the regulatory jumping motive. Furthermore, local technological capabilities significantly support FDI, especially when RTAs reflect the technological interests of the foreign-owned subsidiary, while the effect is reversed when accounting for the innovation portfolio of the parent company.
Topic:
International Trade and Finance, Foreign Direct Investment, European Union, Regulation, and Tariffs
Political Geography:
Europe

2202. FDI and innovation dynamics: The role of foreign corporate groups and technological pathways in domestic green innovation

Author:
Mahdi Ghodsi, Francesca Micocci, and Armando Rungi
Publication Date:
06-2025
Content Type:
Working Paper
Institution:
The Vienna Institute for International Economic Studies (WIIW)
Abstract:
This paper investigates how the presence of foreign direct investment (FDI) contributes to domestic innovation with a focus on green technologies in the European regions between 2013 and 2018. Using a rich dataset combining patent data, firm-level data and FDI proxies, we identify a clear pattern: when foreign investors are technologically sophisticated, domestic firms in the regions where they invested show a higher propensity for patenting. The patenting activity by the parent companies of multinational enterprises (MNEs) and their corporate perimeter plays a more crucial role than local foreign subsidiaries. Furthermore, we find that the technological focus of MNEs – green vs. non-green – shapes the direction of these spill-overs. Notably, we provide novel evidence of linkages between the green patenting activity of MNE parents located abroad and the green innovation of domestic firms in the European Union, mediated through foreign subsidiaries operating in close proximity. Policy efforts aiming to foster green innovation should therefore prioritise attracting foreign investors with strong innovation records in environmentally sustainable technologies.
Topic:
International Trade and Finance, Science and Technology, Foreign Direct Investment, European Union, Multinational Corporations, and Innovation
Political Geography:
Europe

2203. Digitalisation of jobs and gender-age segregation in digital tasks: Cross-country evidence based on ESJS2 data

Author:
Sebastian Leitner and Stella Sophie Zilian
Publication Date:
12-2025
Content Type:
Working Paper
Institution:
The Vienna Institute for International Economic Studies (WIIW)
Abstract:
This paper addresses the disproportional effects of digitalisation across age by investigating: (i) within-job age segregation in tasks by digital intensity; (ii) within-job age disparities in digital upskilling; (iii) age inequalities in wage returns to digital job tasks; and (iv) the role of gender in this age segregation and inequalities. The analysis is based on data of Cedefop’s second wave of the European Skills and Jobs Survey (ESJS2), conducted in 2021. First results of the analysis show that even when controlling for occupation-industry job pairs apart from using other explanatory variables, age segregation and gender gaps are prevalent in the case of digital skill intensity of tasks performed in the jobs of employees, though not in the case of digital upskilling via training measures. Applying the same appropriate controls, we also find that higher within-job digital skill intensity is associated with higher hourly wages. Gender wage gaps are sizable across all skill intensity categories in addition to widening in older age groups.
Topic:
European Union, Inequality, Digitalization, Skills, Gender, and Jobs
Political Geography:
Europe, Norway, and Iceland

2204. Robots, shoring patterns, and employment: What are the linkages?

Author:
Hylke Dijkstra and Konstantin M. Wacker
Publication Date:
07-2025
Content Type:
Working Paper
Institution:
The Vienna Institute for International Economic Studies (WIIW)
Abstract:
In this paper, we analyse how robotisation is associated with industry output and its production inputs. We therefore link data on employment, robotisation and input-output relations for 15 manufacturing industries across 35 countries. Analysing the decade prior to 2018, we show that robotising industries experience increases in output and approximately equiproportional increases in value added, employment, domestic intermediate inputs and foreign intermediate inputs. Owing to this equiproportionality, robotising industries do not see a significant change in their domestic input ratios (value added plus domestic intermediates relative to total inputs). Our empirical results document that robotising industries are thriving in terms of output generation, that those thriving industries are internationally well integrated, and that their output expansion is associated with employment generation. Industries that use an increasing share of domestic production inputs generally experience less favourable output and employment developments, although this association is imprecisely estimated.
Topic:
Labor Issues, Employment, Global Value Chains, Robotics, Production, and Reshoring
Political Geography:
Global Focus

2205. Revisiting the distance elasticity and investment motives in the FDI gravity model: Aggregate vs. sector-level evidence

Author:
Nicola Rebmann and Konstantin M. Wacker
Publication Date:
09-2025
Content Type:
Working Paper
Institution:
The Vienna Institute for International Economic Studies (WIIW)
Abstract:
This paper re-examines foreign direct investment motives in the ‘FDI gravity’ model (Kleinert and Toubal, 2010), focusing on the role of distance. More precisely, we investigate whether aggregate and pooled gravity models for FDI obscure relevant heterogeneities across sectors. This is possible through the novel MREID dataset, which provides us with FDI data at the 2-digit NAICS level for 184 countries over the period 2010 to 2020. Our results reveal that aggregate and pooled models mask significant sector heterogeneities in two aspects: (i) in the importance of horizontal versus vertical FDI motives, and (ii) in the distance elasticity. The latter reflects that distance potentially captures more complex sector-specific components than are captured in the current gravity model for FDI.
Topic:
International Trade and Finance, Foreign Direct Investment, Investment, and Gravity Model
Political Geography:
Global Focus

2206. Innovation interactions: Multinational spillovers and local absorptive capacity

Author:
Ronald B. Davies, Mahdi Ghodsi, and Francesca Guadagno
Publication Date:
06-2025
Content Type:
Working Paper
Institution:
The Vienna Institute for International Economic Studies (WIIW)
Abstract:
The hope that multinational firms will improve local employment and productivity is a driving force behind policy efforts to attract investment. Such spillovers are often motivated by technological spillovers from foreign to domestic firms. We address this possibility by using the patenting activity of foreign multinationals in Europe as a measure of affiliate activity alongside more traditional proxies. We find that local firms’ employment and labour productivity is higher when FDI activity increases, particularly when those multinationals are upstream of locals. Furthermore, this effect is particularly significant among domestic patenting firms. Thus, it seems that the benefits of inbound investment are greatest for local innovators who are exposed to inbound innovating foreigners.
Topic:
International Trade and Finance, Foreign Direct Investment, European Union, Patents, and Spillovers
Political Geography:
Europe

2207. Assessing the interrelationship between atypical work and net migration in the EU: Evidence from 17 Countries (2004–2019)

Author:
Laurène Thil and Stella Sophie Zilian
Publication Date:
06-2025
Content Type:
Working Paper
Institution:
The Vienna Institute for International Economic Studies (WIIW)
Abstract:
This paper studies how atypical work, alongside other labour market conditions, affect intra-EU migration and vice versa in 17 EU countries from 2004 to 2019. Relative increases of part-time and self-employment shares in sending countries increase net migration, whereas relative increases in short fixed-term shares reduce net migration. Net migration shocks persistently reduce part-time share differentials, initially reduce self-employment share differentials and increase short fixed-term share differentials. Atypical work explains about one-fifth of net migration fluctuations five and ten years after a shock. The findings highlight the trade-off between internal (employment flexibility) and external (migration) labour market adjustments.
Topic:
Migration, European Union, Employment, Mobility, and Labor Market
Political Geography:
Europe

2208. Defending Without Provoking: The United States and the Philippines in the South China Sea

Author:
Sarang Shidore
Publication Date:
02-2025
Content Type:
Policy Brief
Institution:
Quincy Institute for Responsible Statecraft
Abstract:
The South China Sea has long been the subject of territorial and maritime disputes between Beijing, Manila, and other claimants. Since late 2022, escalating confrontations between Philippine and Chinese forces over tiny maritime features such as Second Thomas Shoal have posed a serious and growing risk of a military confrontation, which could in turn entangle the United States. Washington can avoid this worst-case scenario by charting a pragmatic approach and upholding its alliance commitment to the Philippines while avoiding military actions that would needlessly provoke China. The data in this brief show a dramatic increase of maritime incidents starting in the third quarter of 2023. China and the Philippines are disputing control over, among other things, what are little more than specks in the ocean, most located a hundred miles or more from the mainland of either country. However, maritime rights and jurisdiction are significant issues, and there is no question that Beijing’s behavior in the South China Sea has been provocative and coercive. Moreover, an international tribunal has ruled overwhelmingly in favor of the Philippines in the dispute, decisively rejecting China’s “historic” claims around the “nine/ten dash line.” The U.S. relationship with the Philippines represents one of the United States’ oldest treaty alliances in the Global South and is important to America’s Pacific strategy. But the South China Sea conflict does not represent a threat of conquest of the Philippine mainland. Washington should recognize that defending maritime rights and tiny land features in waters half a world away is not a vital U.S. national interest and could become a serious liability should it open the door to a high-intensity conflict with China. An honest assessment of U.S. interests dictates a strategy of restraint in the South China Sea. While recognizing Manila’s agency and continuing to strengthen Philippine capacities, Washington should also encourage Manila to engage constructively with Beijing to prevent escalation. Crucially, U.S. policymakers must also avoid raising the risk of conflict by drawing the Philippines into taking a more aggressive stance on Taiwan. Washington can help preserve and uphold international law in the South China Sea while reducing the risk of war between the United States and China by taking the following steps: Do not pull the U.S.–Philippines alliance into the Taiwan theater. Washington should not add to its nine existing military sites in the Philippines and, ideally, should disband one or more of the new sites located in northern Luzon (closer to Taiwan) in exchange for Chinese concessions. Do not give the U.S. Navy or Coast Guard a frontal role in countering Chinese intrusions in the South China Sea; enable Manila to take the lead instead. Do not seek to draw the military of U.S. allies (particularly extra-regional ones) into South China Sea disputes, in order to avoid needlessly heightening Chinese perceptions of bloc-formation and armed encirclement. Enhance diplomatic support to Manila for its legitimate claims under international law. Provide aid, capabilities, and intelligence for modernizing the Philippine Coast Guard and Navy and enhancing maritime domain awareness. Build on the early success of the July 2024 Philippines–China understanding on Second Thomas Shoal by emphasizing preventive diplomacy and crisis management to stabilize the maritime dispute and reduce the chances of a conflict spiral.
Topic:
Foreign Policy, Diplomacy, Territorial Disputes, Armed Forces, Maritime, and Strategic Planning
Political Geography:
Asia, Philippines, North America, United States of America, and South China Sea

2209. Big Ideas and Big Money: Think Tank Funding in America

Author:
Ben Freeman and Nick Cleveland-Stout
Publication Date:
01-2025
Content Type:
Policy Brief
Institution:
Quincy Institute for Responsible Statecraft
Abstract:
This brief provides a detailed analysis of a first-of-its-kind, publicly available repository of U.S. think tank funding — www.thinktankfundingtracker.org. The repository tracks funding from foreign governments, the U.S. government, and Pentagon contractors to the top 50 think tanks in the United States over the past five years. It serves as a vital research guide for anyone wishing to learn more about the funding sources of prominent U.S. think tanks. The repository gives a five-point transparency score to each of the top 50 think tanks in the U.S., a scale created by the authors based on five binary questions. Based on this criteria, nine of the top 50 think tanks (18 percent) are fully transparent, while 23 think tanks (46 percent) are partially transparent. Most concerning, the remaining 18 think tanks (36 percent) are “dark money” think tanks, entirely opaque in their funding without revealing donors. In the past five years, foreign governments and foreign government-owned entities donated more than $110 million to the top 50 think tanks in the United States. The most generous donor countries were the United Arab Emirates, the United Kingdom, and Qatar, which contributed $16.7 million, $15.5 million, and $9.1 million to U.S. think tanks, respectively. The Atlantic Council, Brookings Institution, and German Marshall Fund received the most money from foreign governments since 2019: $20.8 million, $17.1 million, and $16.1 million, respectively. In that same period, the top 100 defense companies have contributed more than $34.7 million to the top 50 think tanks. The top donors include Northrop Grumman, Lockheed Martin, and Mitsubishi, which provided $5.6 million, $2.6 million, and $2.1 million, respectively, to the tracked think tanks between 2019 and 2023. The Atlantic Council, Center for a New American Security, and the Center for Strategic and International Studies were the top recipients of Pentagon contractor money: $10.2 million, $6.6 million, and $4.1 million, respectively. The U.S. government has directly given at least $1.49 billion to American think tanks since 2019. However, the vast majority of this funding — $1.4 billion — goes to the Rand Corporation, which works directly for the U.S. government. While think tanks exist to produce independent analysis, the prevalence of special interest funding raises questions of intellectual freedom, self-censorship, and perspective filtering. This is compounded by instances in which individual researchers simultaneously hold positions at a think tank and a given foreign government or corporation, a clear potential conflict of interest. Moving forward, this brief contains a set of recommendations for various actors: For media: Adopt a professional standard to report any conflicts of interest with sources discussing U.S. foreign policy. For Congress: Pass legislation requiring all nonprofit organizations that seek to influence public policy to publicly disclose all of their corporate, U.S. government, and foreign government donors above $10,000, and improve the conflict of interest disclosure requirements for congressional witnesses. For the Department of Justice: Provide clearer guidelines surrounding what think tanks not registered under the Foreign Agents Registration Act can do on behalf of their foreign donors. For think tanks: End pay-to-play research and proactively move toward identifying conflicts of interest.
Topic:
Foreign Policy, Domestic Politics, Think Tanks, Donors, Funding, and Foreign Influence
Political Geography:
North America and United States of America

2210. European Hedging as a Diplomatic Opportunity for the United States

Author:
Naman Karl-Thomas Habtom
Publication Date:
04-2025
Content Type:
Policy Brief
Institution:
Quincy Institute for Responsible Statecraft
Abstract:
With the onset of multipolarity in the world and growing disagreement between the U.S. and Europe, the U.S. should expect a declining foreign policy alignment with Europe. Rather than bemoan this development, the U.S. should recognize it as a strategic opportunity. Selective hedging by European countries — reducing their dependency on the United States and cultivating stronger relations with other major powers — would facilitate a diplomacy-led, restraint-based U.S. foreign policy and help the U.S. navigate a multipolar world order. For years, Europe has stood as a de facto vassal of the United States, a continent dependent on American military might and comprising countries largely lacking foreign policy independence. Such self-subordination has had negative consequences for Europe and the United States alike. It has weakened Europe’s overall global standing, which in turn means that the U.S. has been able to draw less advantage from its European alliance. This has unintentionally reduced U.S. diplomatic heft in engaging with adversaries. But a considerable U.S.–European schism has recently emerged. The Trump administration’s decided break from the transatlantic status quo has engendered strong disagreements over Ukraine, European security policy more broadly, and international trade. With the combined weakening of political, military, and economic links across the Atlantic, Europe is more likely to hedge moving forward. Strategic hedging — a posture already adopted by many countries in the Global South — would allow European countries to pursue an independent foreign policy, bolstering their international relevance. This reorientation would be diplomatically advantageous to the United States, as hedgers in Europe could serve as friendly interlocutors for American engagement with rival nations. European hedging could provide a conduit for constructive U.S. diplomacy, while discouraging zero-sum thinking and the disintegration of the global order into hostile blocs. The U.S. must recognize that a vassalized European continent is both unsustainable and antithetical to a restrained foreign policy vision. While retaining friendly ties with European countries, the United States should now actively promote selective hedging, paving the way for long-term European independence and peaceful multipolarity.
Topic:
Foreign Policy, Diplomacy, Donald Trump, and Multipolarity
Political Geography:
Europe, North America, and United States of America

2211. Under Primacy, Weapons Sales Will Always Supersede Human Rights

Author:
Annelle Sheline
Publication Date:
04-2025
Content Type:
Policy Brief
Institution:
Quincy Institute for Responsible Statecraft
Abstract:
The U.S. government’s expressed commitment to human rights is routinely undermined by its actual commitment to maintaining America’s global military primacy. Since the 1970s, Washington has cast itself as a defender of global human rights, when Congress passed laws to bar the U.S. from providing security assistance to human rights violators. Yet America’s interest in human rights has long been sublimated to the logic of hegemony, from Cold War containment to the Global War on Terror and beyond. Congress has still never successfully voted to block a weapons sale. Today, the myth that American power upholds human rights lies buried beneath the rubble of Gaza. This research brief traces the emergence of human rights within U.S. foreign policymaking in the waning decades of the Cold War — alongside Washington’s rise to the top of the global arms trade — and surveys the various U.S. government efforts to codify human rights considerations in the practice of U.S. foreign policy, particularly arms sales, through the Biden administration. This history reveals how American leaders, regardless of political party, have consistently instrumentalized human rights concerns to target perceived adversaries, while tossing aside such concerns when they apply to U.S. partners. After Israel invaded Gaza following the Hamas attacks on October 7, 2023, the Biden administration failed to place any meaningful conditions on weapons sales to Israel, despite Israel’s conduct showing clear violations of international and U.S. law. The Trump administration has since expanded America’s unconditional support for Israel. Even as the world becomes increasingly multipolar, the defense establishment remains intent on maintaining U.S. military primacy. In clinging to this pursuit, human rights will remain an afterthought, selectively invoked by U.S. leaders when they do not threaten the military-industrial complex and arms sales. Only a sober recalibration of America’s approach to our new geopolitical reality — including a foreign policy of military restraint — can bring about a deeper commitment to human rights in Washington.
Topic:
Foreign Policy, Human Rights, Military Affairs, Arms Trade, and Multipolarity
Political Geography:
North America and United States of America

2212. Peace Through Strength in Ukraine: Sources of U.S. Leverage in Negotiations

Author:
George Beebe, Mark Episkopos, and Anatol Lieven
Publication Date:
02-2025
Content Type:
Policy Brief
Institution:
Quincy Institute for Responsible Statecraft
Abstract:
The key to American success in ending the war in Ukraine is to broaden, rather than narrow, the issues under negotiation. If American negotiators treat the war as a bilateral dispute between Russia and Ukraine and press both sides to agree to an immediate ceasefire, they are likely to fail. In a narrow negotiation, Russia has significant advantages because it has turned the conflict into a war of attrition in which its much greater population and much larger military industry are overwhelming Ukraine’s defenses. The United States and Europe lack the capacity to match Russia’s arms production or bridge the Russia–Ukraine manpower gap without direct conflict with Russia. By contrast, if Washington recognizes that Moscow’s security concerns extend beyond Ukraine to the broader military threat posed by U.S. and NATO forces in Europe — a threat Russia cannot blunt by conquering Ukraine — the U.S. can employ leverage that Kyiv lacks in direct bargaining with Moscow.
Topic:
Security, Foreign Policy, NATO, Diplomacy, Negotiation, Leverage, and Russia-Ukraine War
Political Geography:
Russia, Europe, Ukraine, North America, and United States of America

2213. U.S.–Cuban Relations: A Realist Case for Pragmatic Engagement

Author:
William M. LeoGrande and Geoff Thale
Publication Date:
06-2025
Content Type:
Policy Brief
Institution:
Quincy Institute for Responsible Statecraft
Abstract:
This report, sponsored by the Quincy Institute for Responsible Statecraft, is the product of a set of consultations among a group of scholars, opinion leaders, and foreign policy specialists that took place over the last nine months to develop a proposal for a new way forward in U.S. relations with Cuba. The project was coordinated by William M. LeoGrande, professor of government at American University, and Geoff Thale, former president of the Washington Office on Latin America and now an independent analyst. In a series of individual discussions, written exchanges, and small group meetings, participants shared views on U.S. foreign policy toward Cuba, including the state of U.S.–Cuban relations, the impact of U.S.–Cuba policy on broader U.S. national interests, and the impact of U.S. sanctions on the Cuban people. Participants also discussed the situation in Cuba itself, including the state of the economy, migration, political rights, and civil rights. The group sought additional input from policymakers, former executive branch officials, and congressional staff. The group’s broad consensus is that the national interest of the United States would be better served by resetting U.S. policy toward Cuba, embarking on a path of engagement aimed at eventually normalizing relations. We recognize that this was not the policy that President Trump pursued in his first term, nor was it a policy supported by key members of the president’s current foreign policy team. As of this writing, the new administration has taken several steps toward tightening the embargo but has yet to announce a full-fledged Cuba policy. Sometimes advancing U.S. interests requires setting aside old animosities and engaging with former adversaries, as President Trump has done by opening negotiations with Syria, as well as continuing talks with Russia, China, and others. The president defines his “America First” foreign policy as one that champions “core American interests” and “puts America and its interests first.” 1 U.S. policy toward Cuba in recent years has failed that test. This document lays out the rationale for a new policy that advances U.S. national interests and also takes into account the interests of the Cuban people. It recommends a series of specific policy steps that would address priority issues like mass migration, narcotics trafficking, and the rising influence of U.S. global rivals, both in Cuba and in Latin America, as well as U.S. economic and cultural interests. This report benefited enormously from the thoughtful comments and suggestions of a great many people with deep experience and insight into U.S.–Cuban relations who graciously shared their expertise and advice with us in the course of this project. They include current and former U.S. government officials — from both the executive and legislative branches — as well as civil society leaders who have been engaged with this issue for many years. We offer special thanks to Ambassador (retired) Jeffrey DeLaurentis, who served as chargé d’affaires in the U.S. Embassy in Havana; Angela Mariana Freyre, former special advisor on Cuba at the National Security Council; Victor Johnson, former staff director for the House Subcommittee on Western Hemisphere Affairs; and Cindy Buhl, former legislative director and foreign policy aide to Congressman Jim McGovern. They read several drafts of this report, and their suggestions improved it considerably. Their participation does not mean that they endorse every argument or recommendation; that responsibly rests with us alone. We are also grateful to the Quincy Institute for Responsible Statecraft for sponsoring this project and especially to Sarang Shidore, director of the Quincy Institute’s Global South program, and Marcus Stanley, director of the Quincy Institute’s Studies department, for their support and advice.
Topic:
Foreign Policy, Engagement, Strategic Interests, and Pragmatism
Political Geography:
Cuba and United States of America

2214. Investing in the National Interest: The DFC and American Statecraft

Author:
Karthik Sankaran and Dan M. Ford
Publication Date:
11-2025
Content Type:
Policy Brief
Institution:
Quincy Institute for Responsible Statecraft
Abstract:
The U.S. International Development Finance Corporation, or DFC, supports private-sector investment across the Global South, particularly in low- and middle-income countries. Congress is currently reviewing legislation to reauthorize the DFC. The DFC is likely to see significant changes in the coming years, including a large expansion of its financial resources and a liberalization of its permissible investments. The likely expansion of the DFC would serve U.S. interests as an instrument of positive influence in the Global South. However, it is also possible that changes made during the reauthorization process may amplify a major concern with the DFC’s focus and strategic approach: an excessive emphasis on national security goals and on exclusionary conflict with U.S. adversaries, particularly China. Such an approach can damage the potential for the U.S. to grow its competitive commercial presence in the Global South and reduce the DFC’s effectiveness as a pro-development instrument that enhances U.S. influence in the Global South. Proposed changes to the DFC’s strategic goals and an outright ban on engagement with Chinese–funded projects may drive the DFC further down an exclusionary, zero-sum path. The DFC should also not be used to invest in high-income countries, which would detract from one of its core missions. This brief outlines a more expansive vision for the DFC, which would help the United States expand its economic footprint in the Global South without the pitfalls of an excessively securitized view of international development. A higher-impact DFC could improve the global influence of the United States, deepen economic partnerships and drive healthy, vigorous competition with China while avoiding coercive and almost certainly ineffective efforts to force countries to completely decouple from Beijing. Critical minerals, energy, and strategic infrastructure should be major focuses of an enlarged DFC. Such projects diversify U.S. supply chains and offer holistic investment opportunities. At the same time, the DFC should pursue an approach that emphasizes broad-based commercial development, to include engagement with small- and medium-sized enterprises. An approach that views target countries as commercial partners rather than pawns for hard security competition best positions the United States to enhance its reputation in the Global South. Expanding the DFC’s range of available financial tools to include, for example, subordinated loans and more mechanisms to manage political and currency risk, could also improve its flexibility as a commercial partner. A clear candidate for a future DFC initiative along those lines is the Lobito Corridor. This project would create a massive transit hub for mineral transportation across sub-Saharan Africa and subsequent incorporation into the global market, bolstering local infrastructure, expanding the supply of critical minerals, and providing ample downstream U.S. investment opportunities. Another possible candidate is the brownfield expansion and modernization of the Puerto Bolivar container port in Ecuador’s El Oro province.
Topic:
Global South, Investment, Private Sector, Supply Chains, Strategic Interests, Statecraft, and US International Development Finance Corporation (DFC)
Political Geography:
North America and United States of America

2215. Beyond Strategic Ambiguity: Supporting Taiwan Without a Commitment to War

Author:
Michael D. Swaine
Publication Date:
09-2025
Content Type:
Policy Brief
Institution:
Quincy Institute for Responsible Statecraft
Abstract:
The first brief in this series made the case that Taiwan is not a vital interest justifying a war between the United States and China. This second brief outlines how Washington can transition from strategic ambiguity to strategic clarity in a manner that continues to deter Beijing from coercing Taipei while ruling out direct American military intervention in defense of the island. This brief recommends that, in the short to medium term, the United States should maintain its standing policy of strategic ambiguity toward Taiwan while also carrying out necessary preparations for a noninterventionist policy shift. These preparations include: A clear statement from Washington that it opposes any unilateral move by Taipei to achieve formal independence. A revitalization of the eroding One China Policy. A reaffirmation of U.S. security commitments to Japan and South Korea. A bolstering of the self-defense capabilities of Taiwan and nearby treaty allies. Encouragement and support for those in Japan who seek to ease tensions with China and wish to cultivate cooperative Sino–Japanese and Sino–American relationships. The initiation of a results-oriented strategic dialogue with China. The expansion of mutually beneficial trade, investment, and technology exchanges with Taiwanese companies and the offshoring of Taiwanese high-tech capabilities. Once these necessary, gradual preparations have been made, the U.S. president should explicitly state that America will not go to war with China to defend Taiwan but that the United States will support Taiwan — and the development of an improved cross-strait environment — in every other way possible. This policy shift is necessary because ongoing military and political trends are eroding the ability of the United States to deter and reassure China, increasing the likelihood of conflict. The One China Policy is deteriorating, the Taiwanese public increasingly rejects any political association with China, and China is expanding its reliance on military displays, which undermines the credibility of the Chinese commitment to a peaceful resolution of the Taiwan issue. More generally, U.S.–China relations continue to worsen. This trajectory renders the standing U.S. policy of strategic ambiguity, which accepts the possibility of a direct U.S. war with China, dangerous and misaligned with U.S. interests. The above preparatory changes will require considerable diplomatic finesse and sustained attention over a considerable period of time. Given the weakened National Security Council and the virtual collapse of the past interagency coordinating process for policy development under President Trump, these required qualities might be in short supply at present. Hopefully, the Trump administration will be able to correct these deficiencies. It is unlikely China would respond to the strategy outlined here by attempting to reunify with Taiwan by force. This is because of the still high — and, in some areas, increased — risks confronting any Chinese use of force and because of the fact that this policy shift would likely increase Beijing’s confidence in eventually reaching a peaceful resolution of the issue.
Topic:
Foreign Policy, National Security, Bilateral Relations, Deterrence, and Strategic Ambiguity
Political Geography:
China, Taiwan, Asia, North America, and United States of America

2216. The Fading of Old Irritants: U.S.–Türkiye Relations in a Post–Assad Landscape

Author:
Adam Weinstein and Steven Simon
Publication Date:
08-2025
Content Type:
Policy Brief
Institution:
Quincy Institute for Responsible Statecraft
Abstract:
The U.S.–Türkiye relationship today is a fraught partnership marked by discord and strategic misalignment — particularly within the context of the Syrian Civil War but long before it as well. With the fading of old irritants in a post–Assad Syrian political landscape, a more stable and cooperative U.S.–Türkiye relationship is possible — an opportunity the Trump administration should seize. The United States and Türkiye, though NATO allies, have historically lacked the shared values that make the transactionalism inherent in alliance frameworks easier to manage. As such, tensions have arisen when the strategic interests of each country or domestic politics have diverged. The Syrian Civil War, particularly since the emergence of the ISIS caliphate in 2014, illustrated this division starkly. While initially supportive of the mission to defeat ISIS in Syria, Türkiye became disillusioned with the military campaign once the United States partnered with the Kurdish–led People’s Protection Units, or YPG. To Türkiye, the YPG is an extension of the Kurdistan Workers Party, or PKK, a militant Kurdish group that the country has fought since the early 1980s and views as an existential challenge. This misalignment of primary objectives in Syria created a fraught dynamic between the U.S. and Türkiye. In December 2024, Bashar al–Assad’s regime fell following a successful military campaign by Hay`at Tahrir al–Sham, or HTS, a Sunni Islamist group with close ties to Türkiye. While HTS’s rule moving forward is precarious, the United States and Türkiye share a common interest in preventing renewed civil strife in Syria. A resumed war could create another wave of asylum migration to Türkiye and beyond, stimulate deeper Israeli involvement, renew Iranian attempts to influence developments, and run counter to a broadly shared international interest in a unitary Syrian state. President Trump has expressed a desire to withdraw American troops from Syria and a willingness to permit greater Turkish influence in northern Syria. To advance a more cooperative U.S.–Türkiye relationship, this brief recommends the following: The Trump administration should establish a formal working group with Türkiye on Syria, bringing together intelligence, military, diplomatic, and economic channels. Türkiye and Kurdish groups should engage in backchannel diplomacy to promote Kurdish integration into a functioning Syrian state and protect the Kurds against human rights abuses. The United States and Türkiye should rebuild strategic trust through targeted defense cooperation, resuming U.S. arms sales to Türkiye contingent on its cooperation in Syria and Iraq, and expanding U.S.–Türkiye joint training and NATO exercises. Türkiye and Israel should engage in stabilization dialogue to mitigate tensions over their respective zones of influence in Syria and to coordinate on eastern Mediterranean energy development.
Topic:
Foreign Policy, Bilateral Relations, Islamic State, Syrian War, Kurds, and Political Transition
Political Geography:
Turkey, Middle East, Syria, North America, and United States of America

2217. Soft Power, Hard Influence: How Qatar Became a Giant in Washington

Author:
Ben Freeman and Nick Cleveland-Stout
Publication Date:
09-2025
Content Type:
Policy Brief
Institution:
Quincy Institute for Responsible Statecraft
Abstract:
This brief explores Qatar’s evolution into one of the more influential foreign lobbies in the United States. Qatar’s story demonstrates how money begets influence in the United States. Since Donald Trump was first elected president in 2016, Qatar has spent nearly $250 million on 88 FARA–registered lobbying and public relations firms. From January 2021 to June 2025, Qatar’s agents reported 627 in-person meetings with political contacts in the United States — more FARA–registered meetings than any other country in the world. The current Trump administration has deep ties to Qatar. Three cabinet-level members in the administration — Attorney General Pam Bondi, FBI Director Kash Patel, and EPA Administrator Lee Zeldin — have all previously held consultancy or lobbying positions on Qatar’s behalf. Qatar substantially increased its political influence efforts beginning in 2017, when it was blockaded and reportedly threatened with invasion by Saudi Arabia and the United Arab Emirates. In response, Qatar began vigorous efforts to counteract anti–Qatar lobbying in the U.S. conducted by Saudi Arabia, the United Arab Emirates, and pro–Israel groups. More recently, Qatar has used its lobbying influence to bolster its legitimacy and reputation as a global conflict mediator and reassert its importance to U.S. strategic interests and its defense posture in the Middle East. In the aftermath of the Hamas attack against Israel on Oct. 7, 2023, Qatar worked to combat claims of terrorist sympathies by successfully positioning itself as a mediator for ceasefire and hostage exchange negotiations between Israel and Hamas. The Qatar lobby has also helped to preserve the country’s standing as a critical U.S. ally in the Middle East, heading off a congressional push to move Al Udeid Air Base out of Qatar, preserving Qatar’s designation as a major non–NATO ally, and strengthening defensive ties via lucrative arms sales. Beyond the defense realm, Qatar is heavily invested in the U.S. In the past five years, Qatar has given upward of $9.1 million to think tanks. Since 2001, it has provided $6.25 billion to American colleges and universities. However, contrary to insinuations from some, its university-related funding and influence have primarily focused on educational efforts within Qatar, where the majority of students enrolled are Qatari. Qatar has also invested more broadly in the U.S. economy. This past May, Qatar pledged to invest $500 billion in the U.S. economy over the next decade, demonstrating its intention to retain its U.S. economic influence for the foreseeable future.
Topic:
Soft Power, Investment, Donald Trump, Lobbying, and Foreign Influence
Political Geography:
Middle East, North America, Qatar, and United States of America

2218. Desecuritizing the Belarusian Balcony: Principles for U.S.–Belarus Relations

Author:
Mark Episkopos
Publication Date:
08-2025
Content Type:
Policy Brief
Institution:
Quincy Institute for Responsible Statecraft
Abstract:
This brief outlines a low-cost, low-risk roadmap for sustained U.S. engagement with Belarus that could help to stabilize NATO’s volatile eastern flank, enabling the U.S. to retrench from the European continent and focus on other theaters. In light of governance concerns voiced by Western officials on the heels of the 2020 Belarusian presidential election, and especially since Belarus provided support to Russian troops in the opening weeks of Russia’s invasion of Ukraine in February 2022, the E.U. and U.S. have adopted a strictly punitive approach to Belarus. Essentially, Belarus has been viewed as an appendage of Russia. However, this approach misses opportunities for the West to take advantage of inherent divisions between the interests of Belarus and Russia. As outlined in previous Quincy Institute research, President Aleksandr Lukashenko of Belarus has long wished to develop a “multi-vector” foreign policy for his country. Such a policy would permit Belarus to maneuver between the East and West to best safeguard its own national sovereignty and interests. While Belarus has moved significantly closer to Russia in recent years, this pivot has in part been in reaction to Western hostility. Lukashenko likely remains open to some degree of cooperation with the West, and has signaled that he does not wish to increase participation in the Russia–Ukraine War. While it is almost certainly impossible to fully remove Belarus from the Russian camp, exploring ways for Belarus to triangulate between Russia and the West could offer significant benefits for U.S. interests and for regional stability. This brief recommends that the Trump administration explore the following bargain with Belarus: In exchange for a Belarusian commitment not to abet, facilitate, or engage in aggression against any NATO state, the U.S. should promise that it will not engage in any effort at an external change of government in Belarus. To firm up the U.S.–Belarus relationship, the U.S. should consider sectoral sanctions relief, including in the Belarusian civilian aviation sector, and U.S. engagement in other non-military investment opportunities, such as the Belarusian electric vehicle industry. The U.S. should also work to restore Belarus’ access to international financial institutions. The U.S. should mediate border issues between Belarus, Poland, and Lithuania toward the goal of deescalation on NATO’s eastern flank. The U.S. should encourage Belarusian efforts both to facilitate Russia–Ukraine peace talks, such as exchanges of prisoners of war and bodies of fallen soldiers, and to contribute to Ukraine’s postwar reconstruction.
Topic:
Foreign Policy, NATO, Bilateral Relations, and Elections
Political Geography:
Russia, Eastern Europe, North America, Belarus, and United States of America

2219. The U.S. and Mexico: A Special Relationship

Author:
Karthik Sankaran
Publication Date:
07-2025
Content Type:
Policy Brief
Institution:
Quincy Institute for Responsible Statecraft
Abstract:
President Trump’s policies carry risks and opportunities for one of the United States’ most vital relationships — that with Mexico. U.S. actions that cause cooperation to break down could damage both prosperity and security in the United States. Alternatively, both the U.S. and Mexico could strengthen cooperation rooted in national interests, allowing deeper linkages that benefit the U.S. economy, enhance stability in Mexico, and alleviate security challenges on the border. Across all trade relationships, the administration appears to seek simultaneously to: repatriate industrial production and employment back to the U.S. (reshoring); open new markets for U.S. investment and exports; construct more geopolitically secure supply lines (nearshoring); limit security threats to the homeland. These aims are not mutually exclusive, and all could be achieved if pursued in a balanced manner. But in the case of Mexico, the U.S. does not appear to be striking this balance. The lack of predictability in trade policy, and the failure to use tools available through existing agreements such as the U.S.–Mexico–Canada–Agreement, or USMCA, are creating contradictory signals and leading the U.S. to leave opportunities on the table. If the administration sends contradictory signals on its trade policy with Mexico, the likely result will be a significant increase in business uncertainty. Beyond the potentially damaging economic effects on U.S. investment decisions, this could have geopolitical consequences, hindering efforts to ensure politically and geographically resilient supply chains. It could also damage the Mexican economy in ways that potentially strengthen organized crime. To simultaneously advance the four key U.S. objectives — restoring manufacturing jobs; building geographically resilient supply chains; gaining economic policy concessions from Mexico; and enhancing the political stability of a neighbor critical to U.S. security — the brief recommends that the Trump administration: recognize Mexican President Sheinbaum’s popularity and openness to compromise as an opportunity to deepen the economic relationship rather than sever it; use the unique legal and institutional features of USMCA to advance the interests of both countries, particularly the improvement of labor conditions and the nearshoring of manufacturing; use diplomacy and USMCA mechanisms to leverage U.S. energy expertise and deepen U.S. investment in Mexico’s renewable energy sector; encourage deeper U.S. investment and engagement in sectors of the Mexican economy other than manufacturing, such as entertainment, retail, financial services, tourism, and healthcare; recognize that economic dealmaking lends itself to security cooperation.
Topic:
Bilateral Relations, Economy, Investment, Manufacturing, Trade, and Donald Trump
Political Geography:
North America, Mexico, and United States of America

2220. Taiwan: An Important but Non-Vital U.S. Interest

Author:
Michael D. Swaine
Publication Date:
09-2025
Content Type:
Policy Brief
Institution:
Quincy Institute for Responsible Statecraft
Abstract:
Taiwan is the most likely flashpoint that could trigger a direct war between the United States and China. It is critical, therefore, to examine whether or not Taiwan constitutes a vital U.S. interest. This brief asserts that Taiwan is an important but not vital U.S. interest. It is not an interest that justifies the United States going to war with China to defend. A direct war between the United States and China would be cataclysmic and cause extraordinary damage to the global economy. It would risk heavy U.S. military losses and possible nuclear escalation. It is also unclear whether the United States would prevail. Taiwan must be a truly vital interest to justify such risks. While it is important to deter a Chinese attack on Taiwan and prevent a regional war that would destabilize East Asia, proponents of a U.S. defense of Taiwan by all means necessary exaggerate Taiwan’s strategic value and China’s military threat to East Asia. Taiwan is neither central to America’s ability to ensure a stable and prosperous Asia open to U.S. economic and political engagement nor is it a critical location for the United States to oppose Chinese hegemony in Asia. China views Taiwan primarily through a political lens. Beijing has not expressed the intent to use the annexation of the island as a stepping stone toward regional hegemony. Moreover, possession of Taiwan would not give China that capacity. The United States is not formally obligated to militarily defend Taiwan, in contrast to its security commitments to treaty allies Japan and South Korea. Washington does have a vital interest in maintaining its security commitments to Tokyo and Seoul — two robust economies and major technology innovators that are each more critical geostrategically than Taiwan. Taiwan does possess considerable value in its high-tech capabilities, producing 60 percent of the world’s most sophisticated semiconductors. But replicating this production capacity in the United States and other Western countries would be far less costly than fighting a war with China over Taiwan. Although Taiwan is not a vital interest justifying war and is not a treaty ally, the United States still has a strong interest in preventing Chinese coercion of this U.S.–aligned democracy. An accompanying brief presents an alternative approach to supporting Taiwan while maintaining U.S. credibility with critical Asian allies.
Topic:
Foreign Policy, Defense Policy, Deterrence, Strategic Interests, and Strategic Ambiguity
Political Geography:
China, Taiwan, Asia, North America, and United States of America