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51. US-India Economic Ties: To the Next Level and Beyond

Author:
Aparna Pande
Publication Date:
10-2024
Content Type:
Special Report
Institution:
Hudson Institute
Abstract:
This executive summary outlines the key recommendations for policymakers that emerged from deliberations at the Takshashila Institution–Hudson Institute roundtable series “US-India Economic Ties: To the Next Level and Beyond.” Its recommendations are divided into four proposed areas for collaboration between India and the United States: trade and investment, ideas and human capital, technology, and methods and mechanisms.
Topic:
Economics, Science and Technology, Bilateral Relations, Investment, and Trade
Political Geography:
South Asia, India, North America, and United States of America

52. Understanding and Countering China’s Global South Strategy in the Indo-Pacific

Author:
John Lee
Publication Date:
09-2024
Content Type:
Special Report
Institution:
Hudson Institute
Abstract:
While the United States and advanced economies and democracies in Europe and Asia are hardening their views of and position against China, the latter is gaining much ground with respect to the developing economies of the Global South. Indeed, China increasingly demands that developing nations base their discourse and policies on approaches that Beijing supports, and many Global South nations are increasingly complying. In other words, a growing number of these nations have started to alter and adopt discourse and policies that better align with Chinese demands and preferences. In the Indo-Pacific, a region that will largely determine the future shape of the global strategic landscape, evidence shows that developing nations are absorbing Chinese norms and preferences and gradually adjusting their thinking and behaviors accordingly. China’s progress vis-à-vis the Global South—especially in the Indo-Pacific—relies on what material inducements and opportunities Beijing can offer. These are most successful when they prioritize rapid development and regime security over liberal economic rules and individual rights. Meanwhile, regardless of where the fault lies, many developing nations do not believe they have benefited as much materially or institutionally from the US-led order as they would like or expect. Members of the Global South often believe the Chinese narrative about the alleged failure of US-led globalization in the post-colonial and post–Cold War periods. For this reason, many in developing economies believe that the interests and values of these nations (or at least those of the regimes in power) better align with what China is promising than with what Washington is delivering. The US and allies such as Japan and Australia have to accept and respond to this reality. This report analyzes and assesses why and how China is making worrying progress when it comes to shaping and influencing the policies and actions of developing economies in the Indo-Pacific. It explains why this is a significant problem for the US and its allies. It then offers some recommendations to counter the Chinese Global South strategy in the region. In offering six recommendations, this report argues that the US can complicate China’s bid for leadership within the Global South, increase the cost and risk for Beijing, challenge and change narratives and discourse favoring China in the Global South, and compete more effectively in the normative and institutional context.
Topic:
Foreign Policy, Economics, and Strategic Interests
Political Geography:
China, Global South, and Indo-Pacific

53. The Global Impact of China’s Water and Related Environmental Problems

Author:
Thomas J. Duesterberg
Publication Date:
03-2024
Content Type:
Policy Brief
Institution:
Hudson Institute
Abstract:
The quantity, location, and quality of water resources in China have long been a distinguishing and even defining characteristic of its history. Records at least as far back as the Ch’in era in the third century BC note the presence of massive waterworks such as irrigation and transportation canals. Terraced rice fields in hilly areas in central and southern China remain iconic images of Chinese civilization. During a contentious and important debate in the mid-twentieth century, geographers and political scientists asked whether the erection of a “hydraulic society” was the explanation for what political scientist Karl Wittfogel identified as “oriental despotism.”1 The German-trained academic argued that the existential requirement to contain endemic flooding and move water from the massive rivers of central and southern China to agricultural areas necessitated an authoritarian system for deploying labor on the scale required for hydraulic engineering projects spanning the continent. Chairman Mao Zedong drily noted at the beginning of his reign that “there is a lot of water in the south and not much water in the north . . . borrowing some water would be good.”2 Mao was soon to unleash the massive workforce of China to renew and expand efforts over the centuries to get water to farmland, control flooding, and reengineer the landscape of modern China. Even without exaggerating the centrality of water issues for historical China, in the modern era water resources are clearly still vital to the country’s economic and ecological health. And hydraulic engineering projects have become increasingly important, both to China’s Asian neighbors and to the global environment. An important new survey of the “ecological history” of modern China concludes that “in growing from impoverished giant to wealthy superpower in seventy years, China has sacrificed whatever resilience its ecosystem once possessed. It has polluted and poisoned its air, water, and soil . . . it has turned forests into plantations and seen deserts expand . . . and has seen lakes come to resemble green paint.”3 Unfortunately, China’s ecological problems have increasingly had negative impacts outside its borders. China’s unprecedented geoengineering to move water from the south to the north is now imperiling both the water resources available downstream from Tibet and the Hindu-Kush mountains, and the economy and ways of living of literally billions of people. China needs ever more land to grow higher quality food and produce higher yields, which frees up land for housing its population. These efforts have led to deforestation not only in China but also in South America and South Asia. And the consistent choice of Beijing’s leadership to drive economic growth at the expense of environmental health has led to dangerous levels of water pollution and poor soil health in China. Environmental degradation has become a growing political issue in China, and its export of this problem has incited considerable international concern. This study explores these issues with a focus on water resources, and it outlines the regional and global impacts of Chinese policy. The study concludes with a discussion of China’s ability and ambition to address these problems as well as how affected countries can help move Chinese leadership toward a more constructive and cooperative effort to develop a solution.
Topic:
Economics, Environment, and Water
Political Geography:
China and Asia

54. Tokyo Has an Opportunity to Become a Financial Hub

Author:
Mark Siegel
Publication Date:
02-2024
Content Type:
Policy Brief
Institution:
Hudson Institute
Abstract:
On his September trip to the United States, Japanese Prime Minister Fumio Kishida attended the United Nations’ annual General Assembly session, and later gave a well-received speech at the Economic Club of New York. His remarks included a comment about how his administration was actively considering a series of policy steps intended to reinvigorate Tokyo’s place in the global financial system; raise Tokyo’s profile as an important financial hub for Asia; and implicitly, regain market share that had been long lost to Hong Kong, and more recently to Singapore. The prime minister’s intentions are laudable, and his suggestions are worth taking seriously. In any case, the proposals under consideration are generally good for financial markets in Tokyo. Cynics will ask whether the horse has left the barn. In a world where continuous face-to-face interaction is less and less necessary for financial transactions, it is fair to ask what it really means to be a financial hub in the twenty-first century. But Japanese officials are not wrong to be concerned about revitalizing Tokyo as an international financial center. Let’s start by acknowledging that the Japanese government—including the prime minister’s office, the Ministry of Finance (MoF), the Financial Services Agency (FSA), and other official bodies—is serious and prepared to take steps to make Tokyo an attractive place for international financial firms to situate their Asian headquarters. After years of asking market participants for recommendations, policymakers have in hand a menu of policy adjustments that make a lot of sense. The list is long, with proposals ranging from offering official business documentation in English, to having special one-stop and fast-track approval processes, to adjusting tax law. Adjustments to tax law are a major issue: for example, the creation of a temporary tax resident status, relaxation of exit tax rules for foreign nationals, and adjustment of tax rules related to the transfer of overseas assets are constructive, long-standing suggestions. Similarly, adjustments to immigration rules related to foreign domestic workers would make it easier for expats to replicate some of the lifestyle benefits that they enjoy in other areas of East Asia.1 Some of the proposals are easy-to-implement, low-cost, measures that would make life less difficult for foreign firms and expats who want to make Tokyo a regional base. And some of them (e.g., major changes to financial sector law and regulation) are harder to imagine, but possible. The three following observations can be made. First, essentially all of the world’s major financial centers of the twentieth century had common law–based legal and regulatory systems. Japan, like France, has a civil law–based system. This difference matters. Both systems function smoothly in the operational sense, but international finance has been dynamic precisely because it rests upon a legal framework that tends to be permissive with guardrails, as opposed to restrictive with an only-allowed-with-permission structure. The point here is not to litigate the virtues and failings of the world’s two most prominent legal systems. The point is that the Japanese government should be honest with itself about the legal and regulatory norms that it collectively thinks of as Japanese, in the context of attracting foreign financial firms to Tokyo. The right kind of policy shifts could be transformative. That said, from a political perspective, some of them will appear to be very challenging. Second, timing matters, and now may be the right time to take policy risks; a window of opportunity may be closing. The reabsorption of Hong Kong into the People’s Republic of China that started under Carrie Lam is now well advanced, and the city has gone from being the preeminent regional hub for Asian finance to being something much less. It continues to lose vitality. A city that had Anglo law with Chinese characteristics (and geography) is now a different place, having adopted Chinese rules with a superficial Anglo form. That transformation has been an unhappy experience for the cosmopolitan residents of the former crown colony, but it is an opportunity for competing financial centers. Singapore, to pick the obvious example, has benefited from Beijing’s heavy-handed approach to Hong Kong. With common law already in place, an existing and well-developed financial community, and not-dissimilar geographic advantages, Singapore is a natural option for regional headquarters and staff as the Hong Kong business environment deteriorates. But Singapore is physically smaller than Hong Kong, and if the latter occasionally felt like the Chinese version of the financial Wild West, the former feels more like a very buttoned-down, engineered community. So while some of what had been Hong Kong’s centrality, and commercial verve, has moved slightly west, a lot of it has been dispersed far and wide. Dubai has picked up some of the slack, and no doubt some of the business has moved back to London and New York—maybe as an interim step, or maybe for good. There is no preeminent Asian financial hub today. It is still in play, and that is a window of opportunity. Third, the metaphorical pie may be shrinking. What if—in a post-COVID world—a central fact of our new environment is that financial centers, like money itself, have been substantially dematerialized? Even the undisputed global financial centers—New York and London—have experienced some of this new reality. Bank and broker-dealer headquarters are no longer beehives of activity, creativity, and deal-making. They are more like corporate conference centers and operation hubs, only housing activities that require collective physical groups on an as-needed basis. Those activities should not be devalued, but these places are relatively empty shells compared to the Before Times (pre-2020). The large banks’ financial statements tell us that these changes have not hobbled actual financial activity, but the staff does not come to the office every day, and does not want to.
Topic:
Economics, Finance, Banking, and Regional Power
Political Geography:
Japan, Asia, and Tokyo

55. Pax Economica: An Interview with Marc-William Palen

Author:
Seokju Oh and Marc-William Palen
Publication Date:
03-2024
Content Type:
Commentary and Analysis
Institution:
The Toynbee Prize Foundation
Abstract:
In his new book Pax Economica: Left-Wing Visions of a Free Trade World (Princeton University Press, 2024), historian Marc-William Palen offers a counter-history of free trade as an ideology and policy. In the nineteenth century, before it became a cherished possession of the Right, free trade was proudly claimed as their own by Left-wing activists, intellectuals, and politicians, those who were unswervingly committed to equality for all and peace among nations. Palen recovers this forgotten history of the “Left-wing free traders” of the late-nineteenth century, showing how liberal radicals, socialists, feminists, and Christian pacifists all viewed free trade as the key antidote to the social problems they encountered. Palen also upends the conventional understanding of the world of the late nineteenth and the early-twentieth centuries and argues that the fin-de-siècle was not the “Golden Age’ of the First Globalization, but actually the “Iron Age” of market enclosures and imperial competition. In February 2024, I had a great pleasure to discuss Pax Economica with Palen. Below is an edited version of the conversation.
Topic:
Economics, Globalization, Markets, History, Free Trade, and Interview
Political Geography:
Global Focus

56. The Yemen Review Quarterly: January-March 2024

Author:
Sana'a Center for Strategic Studies
Publication Date:
04-2024
Content Type:
Commentary and Analysis
Institution:
Sana'a Center For Strategic Studies
Abstract:
Yemen’s political and economic situation worsened in the first months of the year as the impacts of the Red Sea crisis, which began in November, began to manifest themselves. Peace talks between Saudi Arabia and the Houthi group (Ansar Allah) were effectively placed on hold, and the United States broadened its response to the Houthi attacks, launching strikes alongside the UK against Houthi targets inside Yemen and designating the Houthis as a Specially Designated Global Terrorist group (SDGT), which came into effect on February 16. The designation could impact not only Houthi military and economic activities but also risks a further stranglehold on international humanitarian work in Houthi-run territories, as banks and exchange firms stop dealing with Sana’a-based entities. In late March, Houthi authorities issued a 100-rial coin to replace dilapidated notes, escalating the economic warfare between the two rival central banks. Denouncing the move as illegal, the Aden central bank branch prohibited the coins’ circulation, but the real fear is that this is a trial balloon for a series of currency roll-outs that will end with Sana’a printing its own banknotes, possibly with foreign help, as rebel authorities did in Libya in 2019. Prime Minister Maeen Abdelmalek Saeed finally stepped down, succeeded by Foreign Minister Ahmed Awadh bin Mubarak on February 5. Yemen’s ambassador in Riyadh, Shaya al-Zindani, was belatedly appointed to the vacant foreign minister post on March 26. Neither man is popular with the PLC. Combined with the government’s strained finances, this could hamper their effectiveness. Houthi attacks on foreign shipping and US-UK attacks continued more or less unabated, causing in one case the sinking of a ship carrying fertilizer and diesel fuel. US-UK airstrikes have killed at least 37 on the Houthi side, and reportedly some Islamic Revolutionary Guard Corps officers. After talks with Omani officials in Muscat in early April, the US Yemen envoy appeared to hold out hope of a resolution, suggesting the sanctions would be lifted if the attacks stopped – as tensions rose again between Iran and Israel, with possible implications for Yemen. Tensions also rose on frontlines inside Yemen as Houthi and government-aligned forces reinforced their military presence in several areas, including Hudaydah and Marib. The US-UK strikes also heightened the repressive atmosphere in Sana’a and elsewhere, as Houthi authorities cracked down in areas near mobile launch sites and introduced a new law against support for Israel that is already being used as another cudgel to crush dissent. Al-Qaeda’s Yemen branch announced the loss of its leader Khaled Batarfi in March, who died after several months of illness. He was replaced by Saad al-Awlaqi, a senior Yemeni figure with strong tribal ties in Shabwa who is popular among younger members of the group but whose ties with Iran-based Saif al-Adel, the de facto leader of the global organization, appear to be tense. Al-Qaeda also lost Saif al-Adel’s son, known as Ibn al-Madani, reportedly as a result of a fire in the place where he was staying in Marib, and the group’s lead drone expert Khaled al-Sana’ani also died in an apparent traffic incident – incidents that have raised speculation of possible internal skulduggery as Al-Awlaqi settles into his new role.
Topic:
Security, Economics, Politics, and Houthis
Political Geography:
Middle East, Yemen, and Saudi Arabia

57. The infinite connection: How to make the India-Middle East-Europe economic corridor happen

Author:
Alberto Rizzi
Publication Date:
04-2024
Content Type:
Policy Brief
Institution:
European Council on Foreign Relations (ECFR)
Abstract:
The war in Gaza and its fallout have stalled plans for the India-Middle East-Europe economic corridor, or IMEC. But this grand US-led connectivity project to link the EU and India via the Gulf can still happen – and it can serve the geopolitical goals of all its participants. With IMEC, the US and the EU aim to draw India closer and counter Chinese influence. The corridor would provide a boost to India’s strategy to escape encirclement by Beijing and become a leader among developing countries. The UAE and Saudi Arabia, meanwhile, embrace IMEC as part of their push to become an economic bridge between East and West. For the corridor to fulfil its potential, the participants will need to coalesce around implementation plans that can reconcile these different goals. They will also need to overcome internal and external obstacles along each leg of the corridor. Europeans should view IMEC as providing a long-term addition to current trade routes. They should also press for the corridor to expand into a network, promote trade liberalisation with India, and support all the participants as they transition to renewable energy. If they are successful, IMEC could enhance Europe’s economic resilience and increase its options for trade diversification. The links IMEC could help forge among this range of powers may in fact constitute IMEC’s greatest prize, with the corridor helping to prevent fragmentation reaching extreme levels.
Topic:
Economics, Infrastructure, Economic Cooperation, and Strategic Competition
Political Geography:
Europe, Middle East, India, and Gulf Nations

58. Economic and Technological Zones: Economic Strategy in the Tibet Autonomous Region

Author:
Devendra Kumar
Publication Date:
07-2024
Content Type:
Journal Article
Journal:
China Brief
Institution:
The Jamestown Foundation
Abstract:
New Economic and Technology Development Zones (ETDZs) in the Tibet Autonomous Region (TAR) are focused on pockets of the Han population, which will exacerbate tensions within the region. The Tibetan economy is already largely under Han control (except for in the agriculture and livestock sectors), and Han people constitute the majority group in many of Tiber’s urban centers. The TAR government has set up the zones to import practices from elsewhere in the People’s Republic of China (PRC) and shift the region’s economy away from traditional sectors and toward export-oriented industries, construction, and even high-tech manufacturing. The TAR’s external trade is currently limited to Nepal, due to ongoing border tensions with India. Meanwhile, infrastructural challenges hampering the development of the Sichuan-Tibet railway or national highways connecting the TAR with other provinces suggest that further integration with the rest of the PRC remains some way off. In a related policy, the PRC has developed border towns strategically located near land border ports that it has built along its borders with India, Nepal, and Bhutan. Infrastructure buildup on the border could also serve a dual-use purpose in the case of a conflict, as has been the case in India in recent years.
Topic:
Economics, Science and Technology, Manufacturing, Trade, and Autonomy
Political Geography:
China, Asia, and Tibet

59. Marka Deneyimi Yaratma Sürecinde Hikâye Anlatıcılığının Rolü

Author:
Ezgi Limanlı and Burcu Öksüz
Publication Date:
12-2024
Content Type:
Journal Article
Journal:
AURUM Journal of Social Sciences
Institution:
Altinbas University
Abstract:
Bu çalışma, marka deneyimi ve hikâye anlatıcılığı kavramları arasındaki ilişkiyi tespit etmeyi amaçlamaktadır. Marka deneyimi ve hikâye anlatıcılığı kavramlarının, marka ile müşteri arasındaki ilişkide yarattığı duygusal ve davranışsal etkiler (memnuniyet, deneyim, güven ve sadakat gibi) incelenmiştir. Veri toplama yöntemi olarak nitel bir araştırma yöntemi olan odak grup görüşmeleri (üç oturum) kullanılmıştır. Odak grup görüşmelerinde 20 ile 30 yaş aralığında bulunan 8 kadın ve 8 erkek olmak üzere toplam 16 katılımcı yer almıştır. Bütçe ve zaman kısıtlarının olması nedeniyle tesadüfi olmayan örnekleme yöntemlerinden kolayda örnekleme yöntemine başvurulmuştur. Katılımcılara toplam 18 soru yöneltilmiştir. Katılımcılardan öncelikle marka olgusunu kapsayan soruları, daha sonra marka deneyimi sürecinde hikâye anlatıcılığına ilişkin soruları yanıtlamaları istenmiştir. Elde edilen bulgular detaylıca analiz edilmiş ve yorumlanmıştır. Çalışma sonuçlarına göre, hikâye anlatıcılığının marka deneyiminde bir bakıma katalizör görevi üstlendiği görülmektedir. Tüketicilerin duygularına hitap eden, iyi bir şekilde kurgulanmış ve doğru kanallarla ifade edilen gerçek bir hikâyenin tüketicilerde empatiyi arttırdığı ve onları ikna ettiği ortaya konulmuştur.
Topic:
Economics, Communications, Consumer Behavior, Storytelling, Branding, and Marketing
Political Geography:
Turkey and Global Focus

60. Japan’s Approach to the Global South

Author:
Tobias Harris
Publication Date:
04-2024
Content Type:
Working Paper
Institution:
German Marshall Fund of the United States (GMFUS)
Abstract:
Japanese Prime Minister Fumio Kishida, in a January 2023 speech in Washington, DC, stressed that if the G7 countries and their developed-world peers neglect the “Global South”, “we will find ourselves in the minority and unable to resolve mounting policy issues.” These remarks set the stage for a major theme of Japan’s G7 presidency that year, during which Tokyo continued to highlight the importance of more “humility” to strengthen relations between the group’s members and the “Global South”. The G7 leaders’ communiqué at their May 2023 Hiroshima summit did not refer explicitly to the Global South—the United States and other nations did not necessarily share Japan’s preference for the term, which risks treating as monolithic an enormously diverse array of countries—but the document stressed the importance of addressing the needs of middle- and low-income states, including a commitment to “continued efforts to scale up official development assistance (ODA)” and to adopting “innovative financing mechanisms”. This emphasis on outreach to the developing countries assumed greater urgency following Russia’s invasion of Ukraine, when they were often reluctant to support Western efforts to isolate and punish the Kremlin for its aggression. Japan’s approach to the “Global South” is not merely rhetorical. The Kishida government inherited a long-standing approach to developing nations, particularly those in Asia, that seeks to leverage Japanese ODA and public and private investment. The approach has two goals: to promote growth and strengthen economic ties with developing countries, and to foster trust and political credibility that can be translated into influence. The strategy is shaped by Japan’s national interests but seeks to address developing countries’ economic needs without drawing them into an anti-Beijing bloc. The approach has worked well in Southeast Asia, where, thanks to decades of efforts by successive governments, Japan is viewed particularly favorably. Tokyo now appears increasingly determined to pursue the same strategy in other parts of the “Global South”, including South Asia, the Pacific island states, and, to a lesser extent, Africa and Latin America. As Japan’s G7 peers seek to undertake their own initiatives to improve relations with the “Global South”, the key principles and successes of the country’s policies are worth examining.
Topic:
Foreign Policy, Economics, Democracy, Business, Global South, and Trade
Political Geography:
Japan, Asia, and Indo-Pacific