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Begin New Search Political Geography Asia Content Type Policy Brief Publication Year within 5 Years

61. Green New Deal for Carbon-neutrality and Open Trade Policy in Korea

Author:
Jukwan Lee, Jongduk Kim, Jinyoung Moon, Jyun-Hyun Eom, Ji Hyeon Kim, and Jungmin Suh
Publication Date:
05-2022
Content Type:
Policy Brief
Institution:
Korea Institute for International Economic Policy (KIEP)
Abstract:
This study focuses on Korea’s Green New Deal policy and global response measures to climate change that affect international trade. A trade policy perspective and approach have been applied while reviewing the carbon-neutral policy pursued by the Green New Deal. We attempted through an empirical analysis to determine whether the expansion of openness helps reduce carbon emissions and simulate the impact of a carbon-neutral policy, such as the EU's carbon border adjustment, on the global economy under global production networks. In addition, the amount of financial support from Korea's Green New Deal needed to offset the negative economic effects of other countries’ independent carbon-neutral policies was derived. This study finally suggests that the effect of the Green New Deal can be expanded through the restoration of openness and global cooperation.
Topic:
Climate Change, International Trade and Finance, Economy, Trade, Carbon Emissions, and Green New Deal
Political Geography:
Asia and South Korea

62. Securing Asia’s Subsea Network U.S. Interests and Strategic Options

Author:
Matthew Goodman and Matthew Wayland
Publication Date:
04-2022
Content Type:
Policy Brief
Institution:
Center for Strategic and International Studies
Abstract:
More than 1 million kilometers of submarine cables traversing the ocean floor, each about as wide as a garden hose, transmit up to 99 percent of international data, underpinning global trade and communication. This vital digital infrastructure faces myriad threats, from earthquakes and typhoons to fishing nets and saboteurs. The United States derives significant advantages from its centrality in Asia’s subsea cables, which contribute up to $169 billion to the U.S. economy annually and could benefit more U.S. workers and businesses as demand for digital products and services grows globally. But realizing those benefits will require the United States to step up its policy engagement on Asia’s cable networks, which are changing with China’s rise, the emergence of new regional hubs, and new transpacific routes designed to reduce risks and increase network resiliency.
Topic:
Security, International Trade and Finance, Communications, Maritime, and Commerce
Political Geography:
China and Asia

63. North Korea’s Covid-19 Lockdown: Current Status and Road Ahead

Author:
Victor D. Cha, Katrin Fraser Katz, and J. Stephen Morrison
Publication Date:
03-2022
Content Type:
Policy Brief
Institution:
Center for Strategic and International Studies
Abstract:
CSIS hosted a panel of experts for a discussion of the impact of the Covid-19 pandemic on North Korea. The group discussed what is known about the current situation, the primary and secondary effects of the border lockdown, and the broader impact on North Korean society and markets. The group also examined North Korea’s path going forward, the possibility of an easing of restrictions, and the feasibility of humanitarian aid policies to North Korea. The meeting took place under Chatham House Rule on a not-for- attribution basis.
Topic:
Public Health, Pandemic, COVID-19, and Quarantine
Political Geography:
Asia and North Korea

64. The Sino-Lithuanian Crisis: Going beyond the Taiwanese Representative Office Issue

Author:
Konstantinas Andrijauskas
Publication Date:
03-2022
Content Type:
Policy Brief
Institution:
Institut français des relations internationales (IFRI)
Abstract:
The year 2021 marked the 30th anniversary of the establishment of diplomatic relations between China and Lithuania. Instead of commemorative events and customary lofty rhetoric, the bilateral relationship rapidly plunged to a level rarely seen in either country’s foreign policies since the end of the Cold War. Sino-Lithuanian relations remain de facto downgraded to the level of chargé d’affaires, Lithuania’s physical embassy in Beijing is empty, while the southernmost Baltic state continues to withstand China’s multidimensional campaign of diplomatic, discursive and, most importantly, economic pressure. The principal cause behind this diplomatic crisis was the opening of the Taiwanese Representative Office in the Lithuanian capital of Vilnius in mid-November 2021. This Briefing will argue, however, that there were other important reasons behind the current state of affairs that had been accumulating over the course of two years. The opening of the Taiwanese Representative Office in the Lithuanian capital of Vilnius in mid-November 2021 triggered an unprecedented diplomatic crisis between the People’s Republic of China and Lithuania. China resorted to massive economic coercion measures to pressure Vilnius, such as the freezing of bilateral trade. European multinational companies also reported that Beijing blocked their exports because of Lithuanian components in their products. In late January 2022, the European Union (EU) launched a case at the World Trade Organization against China over discriminatory trade practices against Lithuania. The current crisis must be understood in the broader context of the degradation of the relations between China and Lithuania, but also the EU, since 2019. As such, this crisis is symptomatic of the developing trend in the relationship between the EU and China.
Topic:
Foreign Policy, Diplomacy, Bilateral Relations, European Union, and WTO
Political Geography:
China, Europe, Taiwan, Asia, and Lithuania

65. What do we know about cyber operations during militarized crises?

Author:
Michael Fischerkeller
Publication Date:
01-2022
Content Type:
Policy Brief
Institution:
Atlantic Council
Abstract:
The Department of Defense (DoD) will soon kick off the drafting of its cyber strategy and cyber posture review to align US cyber capabilities and operating concepts with the foreign policy objectives of the Joseph Biden-Kamala Harris administration. Given that the administration describes China as the “pacing threat,” debates over the best use of cyber operations and campaigns will likely be framed by US-China interaction in day-to-day competition, and by a potential militarized crisis and war over the status of Taiwan. This essay focuses on how cyber operations employed during militarized crises are likely to impact escalation management. Policymakers may be attracted to the idea that cyber operations could serve as de-escalatory offramps in a crisis. Such expectations should be tempered, if not completely set aside, for two reasons. First, there is no experience with cyber operations employed during a militarized crisis between two nuclear-armed peers. Absent direct experience, all one can rely on is academic research. Yet, secondly, deductive and empirical academic research provides no basis for confidence that cyber operations are either de-escalatory or non-escalatory in the context of militarized crises.
Topic:
Foreign Policy, Cybersecurity, Crisis Management, and Militarization
Political Geography:
China, Taiwan, Asia, North America, and United States of America

66. When the State Becomes the Only Buyer: Monopsony in China’s Public Procurement of Medical Technology

Author:
Fredrik Erixon, Oscar Guinea, and Anna Guildea
Publication Date:
03-2022
Content Type:
Policy Brief
Institution:
European Centre for International Political Economy (ECIPE)
Abstract:
China’s centralised state procurement policies are moving the Chinese market of medical technologies in a monopsonistic direction. A monopsony means that a single buyer exerts strong power to move the market to its favour by gradually cutting prices and setting terms for producers that are extortionary. It is equivalent to a monopoly – with the only difference being that in a monopsony, it is the single buyer that acts in a market-predatory manner. Ultimately, a monopsonistic market empowers the buyer to capture most of the financial rewards from a contract. Competition gets undermined because a vibrant market also requires competition between buyers and, over time, fewer firms will be able to supply the procured goods at terms that are set by the single buyer. This shift towards monopsony does not happen overnight, it is a process that builds on a number of steps that tilts the balance of power in favour of the buyer. First, there is a concentration of buyers, sometimes down to a single buyer – such as the state. This concentration of buyers acts to extract value from sellers by creating pressure to reduce and converge prices. Buyers in monopsonistic conditions may also add other objectives to their agenda, using their monopsonistic position to abuse the market. For example, political objectives may be in place, which can include discrimination against foreign companies or corruption. Finally, there is a consolidation of the market, with fewer suppliers overall, and a focus on price rather than innovation. Several characteristics of a market could be indicative of a monopsony. One of these indicators is the price. In the case of the Chinese market for medical technology, price reductions have been sustained across medical devices, with price cuts exceeding 90 percent in some medical products. When the buyer’s primary focus is to reduce prices, the risk is that low-quality products will drive out high-quality products. Another indicator is price convergence: the idea that one price should apply to the whole market. Price convergence can be observed as the distance between the average and maximum price reduction offered by companies. The small differences seen in the Chinese procurement of medical technologies for these two indicators indicates that prices are converging downwards. Forcing a convergence of prices breaks with natural market behaviour and overall leads to a market with fewer participants. In a monopsony, the buyer tends to capture the dominant part of the market value of the product, which squeezes the margins of sellers. Over time, this leads to fewer competitors as only a few companies can survive under such conditions. These dynamics have real consequences: the number of winning companies in the procurement of medical technology per one million people in China is substantially lower than in the EU. In addition to a reduced reliance on multiple suppliers, the Chinese centralised state procurement reinforces China’s industrial policy to support Chinese firms growing their domestic market shares to the detriment of non-Chinese companies. These are the consequences of a market that is increasingly taking a monopsonistic form. Public procurement does not have to follow the Chinese recipe of centralised state procurement. There is a substantial body of evidence, research, and studies that recommend specific procurement policies that tackle the monopsonistic tendencies embedded in public procurement markets. These recommendations emphasize the importance of competition without lowering the number of firms in the market, underlining the need for a long-term view on how the market delivers continuous innovation. The danger for China is that monopsony will collapse the future market by making it less attractive for companies to innovate and compete. Chinese centralised state procurement and the move towards monopsony will not go unnoticed. These policies clearly breach basic principles and norms of international exchange, and how governments should behave to avoid a distortion of competition. First, Chinese centralised state procurement favours the Chinese medical technology industry to the detriment of non-Chinese companies. Second, given the low prices achieved in Chinese centralised state procurements, there is a risk that firm’s margins are severely cut, putting a lid on global spending on R&D. The EU and the US should coordinate their policies to counter the monopsonistic tendencies of the Chinese market of medical technologies. Their markets for medical technologies are significantly larger than the Chinese market and Chinese companies rely on the US and the European market to maintain their growth. The EU-US Trade and Technology Council (TTC) offers a setting to take these discussions forward and agree on policies to counter Chinese market distortions.
Topic:
Science and Technology, Health Care Policy, Public Procurement, and Monopsony
Political Geography:
China and Asia

67. Processing Trade and Global Supply Chains: Towards a Resilient “GVC 2.0” Approach

Author:
Lucian Cernat
Publication Date:
05-2022
Content Type:
Policy Brief
Institution:
European Centre for International Political Economy (ECIPE)
Abstract:
In the current global context marked by economic fragility, growing uncertainty and geopolitical conflicts, ensuring the smooth functioning of global supply chains becomes more important than ever. Supply shortages, higher freight costs, higher commodity prices and strong demand increase will trigger inflationary pressures for all economic sectors dependent on global value chains (GVCs). As part of global efforts to enhance the resilience of GVCs, this paper makes the case for a broader discussion about the untapped potential of processing trade, a relatively unknown trade facilitation option available in many countries around the world. Processing trade has been credited with stimulating China’s participation in GVCs, in combination with foreign direct investment (FDI) attraction and industrial upgrading. However, processing trade is not just a Chinese phenomenon. In the EU, significant trade flows (over 200 billion euros in 2021 alone) benefitted from a double-digit trade cost reduction, thanks to the EU processing trade provisions. Different types of processing trade arrangements exist in over 70 countries worldwide (including in the EU), as a way to facilitate the integration of developing countries in global production chains. However, these unilateral schemes have different requirements and co-exist without any attempt to facilitate their inter-operability along complex global supply chains. This paper argues that there is a pressing need for a global reflection on how best to promote a better integration between these national processing trade schemes. One option is to promote a “GVC 2.0” approach that offers key recommendations and best practices for processing trade along GVCs. Such a coordinated “GVC 2.0” trade facilitation initiative would not only make GVCs more resilient for countries that depend on global sourcing for their critical economic activities, but it will also reduce the inflationary effect generated by the unnecessary trade costs associated with GVC activities.
Topic:
Political Economy, European Union, Trade, Resilience, and Supply Chains
Political Geography:
Europe, Asia, and Global Focus

68. The war in Ukraine and the future of Russia-China relations

Author:
Marcin Kaczmarski
Publication Date:
04-2022
Content Type:
Policy Brief
Institution:
NATO Defense College
Abstract:
The China-US rivalry, observed since late 2017, has pushed Moscow and Beijing closer togeth- er, but it has not transformed their relation- ship. One reason is the persistent cautiousness of both states, another is Moscow’s lack of capabilities to offer genuine support to China in such areas as the econo- my, trade or technology. The official rhetoric, boasting about the relationship being “better than an alliance”, in reality hides real obstacles to a more substantial co- operation. The first “post-pandemic” in-person meeting be- tween Vladimir Putin and Xi Jinping on 4 February 2022 seemed to have opened the new era in Sino-Rus- sian relations. The joint communication was unusually ideologised, with both states claiming their democratic traditions. China offered support for Russia’s “legiti- mate security concerns” in Europe and opposed fur- ther NATO enlargement. Russia reciprocated by sup- porting China in Asia. The slogans of the relationship having “no limits” or no “red lines” dominated the post-summit narratives. Russia’s war against Ukraine has pushed the Si- no-Russian relationship into uncharted waters. Mos- cow’s failure to secure a quick victory has put Beijing in an uncomfortable position. The future direction of Sino-Russian cooperation will depend heavily on the length of the Russia-Ukraine conflict and the ultimate decision of Beijing as to what extent (if at all) to prop up Russia economically. Regardless of whether Beijing decides to assist Mos- cow in bypassing Western sanctions, the unravelling of the Sino-Russian relationship is highly implausible. We can expect either China’s explicit economic support for Russia or the maintenance of close political ties without economic support. In the first scenario, Russia’s dependence on China would increase dramat- ically, diminishing Moscow’s room for manoeuvre in foreign policy and ultimately turning Russia into Chi- na’s asset in the latter’s global rivalry with the US. In the second scenario, Russia would remain an autono- mous actor, pursuing close political cooperation and normative anti-Western convergence with China, but increasingly isolated and weakened economically. It is only domestic political change in Russia, the end of Vladimir Putin’s personal rule in particular, that would provide Moscow with an opportunity to reassess the relationship with China.
Topic:
International Cooperation, War, Military Strategy, Bilateral Relations, and Conflict
Political Geography:
Russia, China, Europe, Ukraine, and Asia

69. Maximizing the Benefits of Trade for Africa

Author:
Prince Paa-Kwesi Heto
Publication Date:
03-2022
Content Type:
Policy Brief
Institution:
University of California Institute on Global Conflict and Cooperation (IGCC)
Abstract:
African countries are increasingly integrating into global supply chains (GSC). Yet the linkages between African and foreign firms and the impact of GSC activities on the development prospects of African states is not well understood. This policy brief analyzes GSC trade between the U.S. and China, on the one hand, and Southern African Customs Union (SACU) member states on the other. It shows that, contrary to the conventional wisdom that SACU states export raw materials with few value-added products, SACU states are actually positioned further up in the supply chain hierarchy. They import intermediate inputs from China and export a substantial volume of intermediate goods to the U.S. rather than to China. Moreover, GSC trade is diversifying the countries’ exports and increasing their industrial capacity, positioning African countries to attract companies moving out of China, whether because of high production costs, supply chain disruptions, U.S. tariffs, or geopolitical tension between the U.S. and China. But SACU states will need to adopt smart policies to upgrade existing supply chains and position themselves to build or attract new GSCs to their region.
Topic:
Industrial Policy, National Security, Innovation, Trade, and Geoeconomics
Political Geography:
Africa, China, and Asia

70. Rising to the Challenge: The case for permanent progressive policies to tackle Asia’s coronavirus and inequality crisis

Author:
Emma Seery
Publication Date:
01-2022
Content Type:
Policy Brief
Institution:
Oxfam Publishing
Abstract:
Asia remains in the grip of a coronavirus crisis that is supercharging already high levels of inequality. While the richest and most privileged can protect their health and increase their wealth further, the pandemic is putting the lives and livelihoods of the region's poorest and most vulnerable people at risk. Women, poor and low-skilled workers, migrants and other marginalized groups are being hit hardest. But it is not too late to turn the tide. Governments must make this the moment to implement permanent progressive policies that put the needs of the many before the profit and extreme wealth of the few.
Topic:
Labor Issues, Governance, Pandemic, and COVID-19
Political Geography:
Asia