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61. The Economic Dimensions of a Better Iran Deal

Author:
Hadi Kahalzadeh
Publication Date:
06-2025
Content Type:
Policy Brief
Institution:
Quincy Institute for Responsible Statecraft
Abstract:
President Donald Trump can secure a new, better nuclear deal with Iran by removing the barriers that have prevented American companies from entering the Iranian market. This could be achieved through a phased approach that would not require immediately lifting primary sanctions. Doing so would help secure greater nuclear concessions from Iran, generate economic opportunities for American companies that would create an estimated 200,000 American jobs annually, and make a new agreement more durable by strengthening its political bases of support in both the United States and Iran. Decades of sanctions on Iran have failed to compel political capitulation. Instead, Iran has rationally developed a so-called “resistance economy” that evades sanctions, benefiting and empowering hard-liners with close connections to the government. In Washington, many misinterpret Tehran’s resistance and believe that sanctions have not worked because the pressure has not been great enough. But Tehran has held firm, not because sanctions have been too mild but because of a lack of clear and immediate benefits from disarmament. A U.S. policy that includes real economic incentives for compliance will change this equation, empowering more moderate elements of Iranian society and bringing economic benefits not only to the Iranian middle class but to the U.S. and the wider Persian Gulf region. President Trump should issue targeted Office of Foreign Assets Control general licenses, enabling the export of up to $25 billion in U.S. goods annually to Iran, primarily in aviation, agriculture, automotive production, and telecommunications. A deal should also license a five-year carve-out for American–owned foreign subsidiaries operating in Iran, enabling U.S. access to as much as $4 trillion in unrealized Iranian investment opportunities by 2040. Such a license would allow the United States to partner with Gulf regional allies to modernize Iran’s transport and logistics networks, thereby advancing broader regional development and cooperation. The prospect of losing such partnerships would be a powerful incentive for Iran to exercise military and political restraint. In parallel with the technical nuclear discussions, a dedicated economic dialogue could explore ways to keep Iran’s consumer market open to American companies in the near term and unlock investment opportunities for U.S. investors over time. One potential method in that vein would be the inclusion of a “snap-forward” mechanism, in which economic openings accelerate based on Iranian compliance and good behavior. Such a carrot offers the path toward a more robust and dynamic U.S.–Iran economic partnership built on trust. Incorporating economic incentives into a new U.S.–Iran nuclear agreement would benefit private sector constituencies in both countries, bolstering American jobs and industry while reintegrating Iran into the global economy. In the long term, such a multifaceted agreement could blaze a path toward peaceful coexistence with Iran.
Topic:
Economics, Treaties and Agreements, Sanctions, Negotiation, Nuclear Energy, and Foreign Policy
Political Geography:
Iran and Middle East

62. The Temporal Demands of Parental Child Care: Evidence from the American Time Use Survey

Author:
Nancy Folbre and Jooyeoun Suh
Publication Date:
04-2025
Content Type:
Working Paper
Institution:
Political Economy Research Institute (PERI), University of Massachusetts Amherst
Abstract:
Most research on parental time devoted to child care is based on survey questions regarding explicit care activities or co-presence of parents and children in the same room, factors clearly relevant to child development. Time spent keeping an eye and/or ear on young children while engaging in other activities deserves attention for a different reason—it represents an even larger constraint on maternal employment. Analysis of pooled time-diary data from the American Time Use Survey (ATUS) from 2004-2019 focuses on an underutilized question that asks respondents when own household children under the age of 13 were “in their care,” and shows that reported parental time likely devoted to supervision parental time likely devoted to supervision exceeds time devoted to active care by a factor of 2.9 and is more negatively related to maternal hours in paid employment. In-your-care time is an important indicator of the opportunity costs of motherhood, especially in low-income households unable to purchase or otherwise unable to obtain “babysitting” assistance.
Topic:
Economics, Women, Employment, Inequality, Time, Gender, and Child Care
Political Geography:
North America and United States of America

63. Pan-African-Foreign Policy Theory: A Conceptual Significance of Foreign Policy Analysis Within Policy Agenda Setting for Africa

Author:
Chris Landsberg, Sandile Moloi, and Oscar Van Heerden
Publication Date:
10-2025
Content Type:
Journal Article
Journal:
Brazilian Journal of African Studies
Institution:
Brazilian Journal of African Studies
Abstract:
This article claims that Pan-Africanism Foreign Policy Theory is about Africa’s states’ foreign policy. This claim and theory have not been developed before. The closest argument to our Pan-Africanism Foreign Policy Theory is the writing in 2009 by McDougal (2009), which contends that, as the continental states and its premier integration bodies seek to craft a new-Pan-Africanism, African foreign policies should be based on three aspects: cultural and political unity; Afro-centric development, and the Afri-can conceptualisation of Ubuntu. We lay further claim that Pan-Africanism is rarely analysed by reviewing the goals pursued by states, specifically those of security, prosperity, and world reorganisation. This paper aims to make a constructive contribution to the overall literature by examining Pan-Africanism as African foreign policy, given that little has been written about it from this viewpoint.
Topic:
Security, Foreign Policy, Economics, Pan-Africanism, and Regional Politics
Political Geography:
Africa

64. Between Two Reefs: Indonesia’s Strategic Culture in the Twenty-First Century

Author:
Gregory B. Poling and Andreyka Natalegawa
Publication Date:
12-2025
Content Type:
Policy Brief
Institution:
Center for Strategic and International Studies (CSIS)
Abstract:
In a landmark 1948 speech, Indonesia’s first vice president, Mohammad Hatta, proclaimed, “The best policy to adopt is one which does not make us the object of an international conflict. On the contrary, we must remain the subject who reserves the right to decide our own destiny and fight for our own goal, which is independence for the whole of Indonesia.”1 While Hatta spoke of the Cold War and the choice of aligning with either the Soviet Union or the United States, his conception of Indonesia as rowing between two reefs (mendayung antara dua karang) has remained a guiding principle of Indonesian foreign policy in the decades since the country’s independence. As the world’s third-largest democracy, the largest Muslim-majority nation, a founding member of the Non-Aligned Movement (NAM), and a leading figure in the Association of Southeast Asian Nations (ASEAN), Indonesia has been characterized as a rising middle power and a central player in the emergent Global South. As a sovereign country, Indonesia has pursued what analysts and policymakers describe as a bebas aktif, or free and active, foreign policy—free because the country does not side with world powers, and active because it does not take passive or reactive stances on global issues but does seek to operate in a diplomatic role.2
Topic:
Economics, Geopolitics, Strategic Competition, and Great Powers
Political Geography:
Indonesia and Southeast Asia

65. Saudi Arabia’s Strategic Vision

Author:
Leah Hickert
Publication Date:
12-2025
Content Type:
Policy Brief
Institution:
Center for Strategic and International Studies (CSIS)
Abstract:
In March 2023, two men stood shaking hands in front of a blinding array of flashing cameras while the international community—and especially observers from across the Middle East—watched in disbelief at their unlikely meeting. Videos captured the previously unimaginable scene of Ali Shamkhani, the secretary of the Supreme National Security Council of Iran, smiling alongside Musaad bin Mohammed al-Aiban, Saudi Arabia’s national security adviser. The adversaries had just agreed to restore diplomatic relations, de-escalating regional tensions that had been brewing since the two countries severed ties in 2016, when demonstrators stormed the Saudi embassy in Tehran to protest Riyadh’s execution of a prominent Shia Muslim cleric. Notably, some onlookers did not think the rapprochement was the most surprising aspect of the press conference. For many, the deal was the natural culmination of years of negotiations between Saudi Arabia and Iran. Instead, these observers were stunned by the nationality of the man who Saudi Arabia asked to mediate the deal. He stood just behind the pair, in front of a flag with 5 stars—not 50. China’s top-ranking diplomatic official, Wang Yi, heralded in the new era of regional peace. U.S. officials were nowhere to be found.
Topic:
Economics, Strategic Competition, International Order, and Regional Politics
Political Geography:
Middle East and Saudi Arabia

66. Friendshoring Copper: A New Pillar of the U.S.-Brazilian Economic Partnership

Author:
Gracelin Baskaran, Meredith Schwartz, and Bryan Harris
Publication Date:
09-2025
Content Type:
Policy Brief
Institution:
Center for Strategic and International Studies (CSIS)
Abstract:
Brazil holds some of the world’s largest reserves of critical minerals, including niobium, rare earths, graphite, manganese, bauxite, zinc, and lithium. However, the next frontier is copper, which now accounts for one-third of all mineral exploration investment in the country. Market enthusiasm for Brazil’s copper aligns with a global outlook in which copper demand is projected to nearly double by 2035. China has already secured a strong foothold in Brazil’s mining ecosystem through trade agreements, concessional financing, and infrastructure investments. By contrast, the United States remains in the early stages of building a minerals partnership with Brazil. Unlocking Brazil’s potential as a major copper producer—and securing U.S. access to this strategic metal—will require bilateral efforts. Brazil must strengthen geological mapping, expand infrastructure, and streamline its overly bureaucratic permitting system. On the U.S. side, deploying strategic financing, promoting vertical supply chain integration, and offering targeted tariff exemptions to advance national and economic security objectives will be critical to a successful partnership.
Topic:
Economics, Partnerships, Mining, Trade, Economic Security, Copper, and Friendshoring
Political Geography:
Brazil, South America, North America, and United States of America

67. CRINK Economic Ties: Uneven Patterns of Collaboration

Author:
Maria Snegovaya, Nicholas Fenton, and Tina Dolbaia
Publication Date:
09-2025
Content Type:
Policy Brief
Institution:
Center for Strategic and International Studies (CSIS)
Abstract:
China, Russia, Iran, and North Korea (CRINK) face obstacles to economic collaboration such as geographic distance, sanctions, mutual mistrust, and self-sufficiency goals. Reliable data on CRINK’s economic and trade ties is limited due to lack of reported data from Iran and North Korea and the rise of informal and shadow trade since Russia’s invasion of Ukraine. Existing data reveals uneven patterns, although expanding bilateral agreements, strengthening energy ties, and increasing trade in dual-use technologies point to growing economic cooperation among the CRINK countries. CRINK also seeks to integrate their financial and payment systems to bypass Western sanctions by prioritizing national currencies over the U.S. dollar. The post-2022 China-Russia relationship drives most of the momentum, while Iran and North Korea exhibit expanding but considerably weaker integration with the rest of the group. China is nevertheless a cautious actor that hedges its bets in energy trade with Russia and Iran, avoids flagrant sanctions violations, and faces constraints from its own economic slowdown.
Topic:
Economics, Trade, Treaties and Agreements, Economic Security, Geopolitics, International Security, and Russia-Ukraine War
Political Geography:
China, Asia, Middle East, Russia, and Europe

68. The Economic Impacts of Supply Chain Fragmentation in Critical Minerals

Author:
Young Gui Kim
Publication Date:
05-2025
Content Type:
Policy Brief
Institution:
Korea Institute for International Economic Policy (KIEP)
Abstract:
Recent developments in geopolitical tensions have heightened concerns about strategic decoupling in global supply chains. Prior research has predominantly focused on macroeconomic impacts of comprehensive supply chain fragmentation, yet such extreme scenarios lack operational relevance. A more feasible scenario involves targeted decoupling in strategic sectors, such as the US restricting Chinese access to advanced technology industries, potentially triggering retaliatory measures in critical mineral supply chains. Even if supply chain fragmentation is limited to a few advanced industries and the critical minerals used in them, its economic impact is expected to be significant. Therefore, to accurately estimate the effects of recent global supply chain fragmentation, it is necessary to consider both a micro-economic approach at the item level and a macro-economic approach across the broader economy. In this study, we review previous literature using various methodologies and propose a method that integrates micro-economic and macro-economic approaches. Using the proposed methodology, we quantitatively estimate the economic impact under a scenario of fragmentation in critical minerals and draw policy implications. Fragmentation of critical mineral supply chains can disrupt the production of high-tech goods such as semiconductors and secondary batteries, thereby affecting the overall economy. These sectors rely on highly complex supply chains that span multiple countries and involve numerous components. The high degree of interdependence among items within these supply chains makes it particularly challenging to analyze the impact of critical mineral fragmentation on high-tech manufacturing output. To address this challenge, we employed a Dual-stage Attention-based Recurrent Neural Network (DA-RNN), which accounts for both inter-item correlations and temporal dynamics. Using time-series data on imports of various critical minerals, we constructed a DA-RNN model to predict the monthly exports of high-tech products, including secondary batteries, metal oxide salts, automobiles and automobile parts, semiconductors, and ships. Using the DA-RNN analysis results as inputs, we assessed the macroeconomic impacts of critical mineral fragmentation with the OECD METRO model. The OECD METRO model is a global computable general equilibrium (CGE) model designed to capture international trade linkages and policy impacts. A key feature is its detailed breakdown of final demand into intermediate goods, private consumption, government consumption, and capital goods. Two analytical approaches were applied to the three previously described scenarios. Approach 1 directly examines the macroeconomic effects in the METRO model by simulating delays in critical mineral imports from China. Approach 2 first assesses the impact of delayed imports on Korea’s high-tech industries using machine learning techniques, and then uses these results as inputs to estimate the macroeconomic effects in the METRO model.
Topic:
Economics, Geopolitics, Supply Chains, and Critical Minerals
Political Geography:
Global Focus

69. Satellite-Based Analysis of North Korea’s Market System

Author:
Jangho Choi
Publication Date:
06-2025
Content Type:
Policy Brief
Institution:
Korea Institute for International Economic Policy (KIEP)
Abstract:
The findings of this study suggest that satellite imagery enables a disaggregated analysis of North Korean markets by region, subregion, and economic actor, offering a multi-dimensional perspective on market dynamics. Specifically, the results indicate that North Korea’s markets have been expanding over the medium to long term. While COVID-19 containment measures and border closures led to a temporary contraction in market activity, they did not fundamentally reverse the trajectory of market growth. Market activity was observed to increase in correlation with improved logistics and supply flows—that is, as more goods were delivered to markets, prices tended to fall, and commercial activity expanded. This suggests that the expansion of the state commercial system under the North Korean government—characterized by greater administrative control and intervention in markets—does not aim to suppress or dismantle markets. Rather, it appears to reflect an effort to regulate and integrate increasingly active markets by partially substituting private sector functions with the state-run commercial network. The intended outcomes include increased fiscal revenue and the provision of stable commodity supplies to the population. Satellite imagery analysis remains at a relatively early stage of development in the context of North Korea. As a result, some of the derived indicators have shown inconsistencies or produced controversial findings, underscoring the need for continuous methodological improvement through sustained research. Further validation is also required to ensure that the various satellite-based indicators convey consistent and non-contradictory information.
Topic:
Economics, Markets, Economic Development, and Satellites
Political Geography:
Asia and North Korea

70. AI Standard Choices Under Geopolitical Competition

Author:
Sangjun Yea
Publication Date:
10-2025
Content Type:
Policy Brief
Institution:
Korea Institute for International Economic Policy (KIEP)
Abstract:
This study examines how global competition over artificial intelligence (AI) standards is unfolding amid growing geopolitical rivalry between the United States and China. It develops a theoretical model to analyze how a third country decides whether to align its domestic AI standard with the U.S. or Chinese framework once both standards exist. The analysis highlights that the choice depends primarily on global and local network effects, market competition, and the role of domestic platforms intermediating AI services. The findings suggest that the technological superiority of foundation AI models and the expanding global user base are key determinants of international standards adoption, implying that AI standardization has become a strategic domain of global economic and political competition.
Topic:
Economics, Geopolitics, Artificial Intelligence, and Strategic Competition
Political Geography:
China, Asia, North America, and United States of America

71. Management practices, competition, and multi-product firms in developing countries

Author:
Victor Gimenez-Perales and Alina Mulyukova
Publication Date:
09-2025
Content Type:
Working Paper
Institution:
Kiel Institute for the World Economy (IfW)
Abstract:
We study how liberalization and competition affect firms’ output and product scope depending on management practices. In a model of multi-product firms, we show that firms with better management practices specialize in fewer products with lower marginal costs. The model predicts that, under increased competition, firms with better management practices are less adversely affected by competition, especially in heterogeneous sectors. Evidence from India’s de-reservation policy supports these predictions. Our simulations estimate a 0.29% welfare gain in India from the policy. The same policy could increase welfare by 0.39% in an environment with better management practices, such as the US, highlighting the management practices’ role in liberalization outcomes.
Topic:
Development, Economics, Business, Innovation, Management, and Liberalization
Political Geography:
South Asia, India, and United States of America

72. Economic Insecurity: Trade Dependencies and Their Weaponization in History

Author:
Martin Bernstein, Josefin Meyer, Kevin H. O'Rourke, and Moritz Schularick
Publication Date:
07-2025
Content Type:
Working Paper
Institution:
Kiel Institute for the World Economy (IfW)
Abstract:
Do trade dependencies leave countries vulnerable to geopolitical coercion? We study the economic costs of trade and financial sanctions, from 1920 to the present. We first develop a continuous measure of sanction intensity, using bilateral commodity-level data to calculate the importance of specific flows that fall under sanctions. We find that sanctions inflict relatively small costs on average: sanctioning 1% of GDP worth of imports or exports leads to approximately 0.3 percentage points of lost GDP over a 5-year period and a 0.1 percentage point increase in unemployment. However, we show that sanctions are far more costly for countries whose trade is highly concentrated, and for countries that rely heavily on exporting primary commodities. Low income and developing countries appear most vulnerable to trade sanctions, while high income financial centers and some EU countries are among the most exposed to financial sanctions.
Topic:
Economics, International Trade and Finance, Political Economy, Sanctions, Trade, Vulnerability, Coercion, and Geoeconomics
Political Geography:
Global Focus

73. Trade Wars and Currency Wars – Lessons from History

Author:
Kris James Mitchener and Kirsten Wandschneider
Publication Date:
04-2025
Content Type:
Policy Brief
Institution:
Kiel Institute for the World Economy (IfW)
Abstract:
Explaining President Trump’s “Liberation-day” tariffs on April 2nd, 2025, Stephen Miran, President Trump’s chairman of the council of economic advisors suggested that countries accept the U.S. tariffs without retaliation to come to a fair “burden sharing”(Miran: 2025). History shows that this assumption is wrong: using a detailed data set of bilateral trade flows constructed for the interwar period, this column shows that in fact the US faced substantial and widespread retaliation from trade partners in response to the U.S. Tariff Act of 1930 (i.e., the Smoot-Hawley Tariff). U.S. exports to retaliating countries fell by as much as 33%, with U.S. trade partners specifically targeting high-end, branded consumer products, such as U.S. autos. The drop in trade contributed to the Great Depression, which in turn triggered a large currency war: between 1929 and 1936, 70 countries devalued their currencies relative to gold. We show that trade was further reduced by more than 21% following devaluation. The currency war destroyed the trade-enhancing benefits of the global monetary standard, ending regime coordination and increasing trade costs. The 1930s are a potent reminder of what can happen when international policy coordination breaks down and countries go it alone when negotiating trade and exchange-rate policies.
Topic:
Debt, Economics, International Trade and Finance, Financial Crisis, Tariffs, Trade Wars, Trade Policy, and Donald Trump
Political Geography:
North America and United States of America

74. Sovereign vs. Corporate Debt and Default: More Similar Than You Think

Author:
Gita Gopinath, Josefin Meyer, Carmen Reinhart, and Christoph Trebesch
Publication Date:
04-2025
Content Type:
Working Paper
Institution:
Kiel Institute for the World Economy (IfW)
Abstract:
Theory suggests that corporate and sovereign bonds are fundamentally different, also because sovereign debt has no bankruptcy mechanism and is hard to enforce. We show empirically that the two assets are more similar than you think, at least when it comes to high-yield bonds over the past 20 years. We use rich new data to compare high-yield US corporate (“junk”) bonds to high-yield emerging market sovereign bonds 2002-2021. Investor experiences in these two asset classes were surprisingly aligned, with (i) similar average excess returns, (ii) similar average risk-return patterns (Sharpe ratios), (iii) similar default frequency, and (iv) comparable haircuts. A notable difference is that the average default duration is higher for sovereigns. Moreover, the two markets co-move differently with domestic and global factors. US “junk” bond yields are more closely linked to US market conditions such as US stock returns, US stock price volatility (VIX), or US monetary policy.
Topic:
Economics, Sovereign Debt, Sovereign Default, and Corporate Bonds
Political Geography:
North America and United States of America

75. Spatial distribution of housing liquidity

Author:
Francisco Amaral, Mark Toth, and Jonas Zdrzalek
Publication Date:
03-2025
Content Type:
Working Paper
Institution:
Kiel Institute for the World Economy (IfW)
Abstract:
This paper examines the relationship between location, liquidity, and prices in housing markets. We construct spatial datasets for German and U.S. cities and show that liquidity and prices decline with distance to the city center. To rationalize these results, we build a structural model with spatial search frictions. We argue that location preferences concentrate buyers in central areas, making markets tighter, more liquid, and driving up prices. Counterfactuals show that suppressing search frictions raises welfare and prices, especially in peripheral areas. Our findings highlight the importance of demand-side preferences and search frictions for understanding liquidity and asset prices.
Topic:
Economics, Financial Markets, Cities, Housing, Real Estate, Liquidity, and Assets
Political Geography:
Europe, Germany, North America, and United States of America

76. In Merz We Truss: Financial Market Reaction to Germany’s Fiscal Package

Author:
Filippos Petroulakis and Farzad Saidi
Publication Date:
03-2025
Content Type:
Working Paper
Institution:
Kiel Institute for the World Economy (IfW)
Abstract:
• This study analyzes capital market reactions to Germany’s recent announcement of loosening fiscal restrictions for defense and state-level spending, while establishing a €500 billion infrastructure investment fund. In particular, we examine whether surging Bund yields reflect growth expectations or fiscal risk concerns. • Clear evidence of growth expectations: The steepening German yield curve, rising stock prices, euro appreciation, and stable credit default swap prices collectively indicate that markets interpret Germany’s fiscal expansion as growth-enhancing rather than a reckless fiscal bet. • The contrast with the UK’s Truss-Kwarteng episode is stark: Unlike the 2022 UK “mini budget” aftermath, which triggered a selloff across all UK asset classes, Germany’s announcement has seen positive market reception across different asset classes, suggesting confidence in Germany’s fiscal credibility. • While the policy shift introduces some uncertainty, evidenced by modest increases in the European VSTOXX volatility index, this reaction appears calibrated and partially attributable to concurrent global market events, reinforcing the interpretation that markets view Germany’s fiscal expansion as responsible.
Topic:
Economics, Markets, Budget, Fiscal Policy, Sovereign Debt, Yield Curve, and Debt Brake
Political Geography:
Europe and Germany

77. The Great Equalizer: Effects of Chinese Official Finance on Economic Complexity across Recipient Countries

Author:
Jan Denninger and Lennart Kaplan
Publication Date:
01-2025
Content Type:
Working Paper
Institution:
Kiel Institute for the World Economy (IfW)
Abstract:
This paper analyzes whether Chinese aid and other forms of official finance affect structural transformation in low- and-middle income countries. Specifically, we employ an instrumental variables (IV) approach to causally analyze the effect on the Economic Complexity Index of 98 recipient countries over the 2002-2016 period. Economic complexity is defined as the diversity and sophistication of the goods an economy produces. The results reveal that Chinese official financing (OF) does not have statistically significant effects at the aggregate level; however, its effectiveness varies across sectors and recipients. A sectoral perspective shows that Chinese OF to recipients’ production sectors has a significantly negative effect on their economic complexity. These effects are most pronounced for high-complexity recipients, suggesting that China primarily targets industries below existing levels of complexity, thereby impeding potential structural transformation. In contrast, low-complexity recipients experience positive complexity effects from Chinese social sector projects, especially from those related to education. Given that China is known for its demand-driven approach of lending, recipients should push for an adjustment in the composition and allocation of Chinese OF to render structural transformation more likely.
Topic:
Economics, International Trade and Finance, Foreign Aid, and Complexity
Political Geography:
China and Asia

78. Who wins wars?

Author:
Jonathan Federle, Dominic Rohner, and Moritz Schularick
Publication Date:
01-2025
Content Type:
Working Paper
Institution:
Kiel Institute for the World Economy (IfW)
Abstract:
Economic resources are often seen as decisive for the outcomes of military conflicts. This paper asks whether “deeper pockets” help win wars. We construct a fine-grained dataset covering more than 700 interstate disputes and rely on exogenous resource price shocks to estimate the causal effect of windfall gains on winning chances in interstate conflicts. We find a statistically significant and quantitatively large impact of windfall gains on winning odds and show that a key channel of transmission is a surge in military spending, after an exogenous increase in government revenues.
Topic:
Economics, International Trade and Finance, Military Spending, Fiscal Policy, Armed Conflict, and Geoeconomics
Political Geography:
Global Focus

79. Official Development Assistance

Author:
Institute for Economics and Peace (IEP)
Publication Date:
03-2025
Content Type:
Special Report
Institution:
Institute for Economics & Peace (IEP)
Abstract:
Amidst rapidly shifting geopolitics, major donors such as the United States, the United Kingdom and European Union (EU) countries have announced significant reductions to their annual Official Development Assistance (ODA) commitments. In 2023, contributions from these countries accounted for 63 per cent of all ODA flows. † A key driver of the current situation has been the Russian invasion of Ukraine, which has led to unprecedented aid allocations to Ukraine. In 2023, Ukraine received $37 billion in ODA, equating to 14 per cent of all ODA disbursed in that year. In addition to ODA, military aid allocations to date have totalled $128 billion. † Given the current climate, this report presents economic projections under various scenarios, indicating that ODA could decline by 20 to 40 per cent in the coming years. This would result in reductions of between $50 and $115 billion less aid relative to 2023 levels. † In such scenarios, sub-Saharan Africa, MENA and Latin America could see cuts of 30-40 per cent in their ODA inflows, exacerbating risks of economic downturns, political instability, and humanitarian crises. † The economies that will be most affected by ODA cuts are also in the least peaceful countries in the world. Most at risk include Afghanistan, Yemen, Central African Republic, and Somalia. † Existing and emerging donors are unlikely to be able to fill the gap. Countries such as China, Saudi Arabia and Türkiye contribute less than five per cent to the international aid system. † With US support for Ukraine in question, EU countries may need to further increase their contributions to Ukraine and boost domestic military spending. † Calls to raise EU military spending to five per cent of GDP could require an additional $560 billion annually, diverting funds from other sectors. † In a climate of shrinking resources and rising demand, there is an urgent need for reforms that enhance the efficiency, transparency, and data-driven targeting of ODA. † Investing in robust monitoring and evaluation systems is essential to ensure that limited aid funds yield maximum developmental and economic benefits.
Topic:
Development, Economics, Donors, Development Assistance, and Russia-Ukraine War
Political Geography:
Global Focus

80. Global Peace Index 2025

Author:
Institute for Economics and Peace (IEP)
Publication Date:
06-2025
Content Type:
Special Report
Institution:
Institute for Economics & Peace (IEP)
Abstract:
This is the 19th edition of the Global Peace Index (GPI), which ranks 163 independent states and territories according to their level of peacefulness, covering 99.7 per cent of the world’s population. Produced by the Institute for Economics & Peace (IEP), the GPI is the world’s leading measure of global peacefulness. This report presents the most comprehensive data-driven analysis to date on trends in peace, its economic value, and how to develop peaceful societies. It uses 23 qualitative and quantitative indicators to measure the state of peace across three domains: the level of Societal Safety and Security; the extent of Ongoing Domestic and International Conflict; and the degree of Militarisation. The 2025 GPI finds that global peacefulness continues to decline and that many of the leading factors that precede major conflicts are higher than they have been since the end of WWII. More countries are increasing their levels of militarisation against the backdrop of rising geopolitical tensions, increasing conflict, the breakup of traditional alliances and rising economic uncertainty.
Topic:
Development, Economics, Geopolitics, Peace, Armed Conflict, and Peacebuilding
Political Geography:
Global Focus