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  • Author: Angela Stanzel, Agatha Kratz, Justyna Szczudlik, Dragan Pavlićević
  • Publication Date: 12-2016
  • Content Type: Working Paper
  • Institution: European Council On Foreign Relations
  • Abstract: China faced hard times in 2016 – at least when it comes to promoting its investment in Europe. The European Union is one of its most important economic and trading partners and the final destination of China’s flagship initiative, the New Silk Road. However, some EU member states have recently become increasingly critical of China’s push for more investment in Europe. Beijing has invested significant effort in building a new entry point into Europe through the central and eastern European (CEE) countries – in particular, through the 16+1 framework. As reflected in Agatha Kratz’s article in this edition of China Analysis, the CEE region is attractive to China thanks to its strategic geographical position for the New Silk Road project, its high-skilled yet cheap labour, and its open trade and investment environment.
  • Topic: International Political Economy, International Affairs
  • Political Geography: China
  • Author: John Whalley, Li Chunding
  • Publication Date: 05-2016
  • Content Type: Working Paper
  • Institution: Centre for International Governance Innovation
  • Abstract: The Trans-Pacific Partnership (TPP) Agreement has now been concluded, but it still faces the challenge of ratification in each of the 12 member countries that are partners to the agreement. China is the world’s second- largest economy, but is not part of the TPP Agreement, which has provoked a great deal of debate in China on the best strategy for China to deal with the TPP. This paper analyzes China’s possible trade strategy, raising three issues for consideration, given the TPP Agreement. First, security of market access should be China’s main concern in any free trade agreement (FTA) negotiation, but the TPP does not include content that is particularly relevant to this issue. Second, the nal TPP Agreement is somewhat less than the high-level, ambitious agreement that has been proclaimed. Third, the rati cation process in all 12 member countries will be slow and may possibly not even happen. This paper sets out four strategies for China: to promote the development of China’s remaining regional and bilateral FTAs; to negotiate a bilateral FTA with the United States; to promote deep domestic reform and opening up by enlarging the coverage of the TPP; and, nally, to negotiate its entry in the TPP as soon as possible, so that the terms of entering the agreement do not degenerate for China.
  • Topic: International Political Economy
  • Political Geography: China
  • Author: Choi Nakgyoon
  • Publication Date: 12-2016
  • Content Type: Working Paper
  • Institution: Korea Institute for International Economic Policy (KIEP)
  • Abstract: This paper studied the effects of anti-dumping measures on the imports to investigate whether the trade restriction effect of an anti-dumping duty is dominant in the US, the EU, China, and India from 1996 to 2015. Our results indicate that a 1% increase in the anti-dumping duties decreases the import of the targeted product by about 0.43~0.51%. The actual statistics, however, show that the total import of the targeted products increased by about 30 percent while an anti-dumping duty was in force. That indicates that an anti-dumping duty is just a temporary import relief. This paper also investigated whether an anti-dumping duty is terminated in the case that the injury would not be likely to continue or recur if the duty were removed. The increase in market share, MFN tariff rate, and dumping margin turns out to decrease the hazard of termination of an anti-dumping duty, but the increase in value added increases the hazard of termination. Generally speaking, this result indicates that the WTO member countries have regulated the overuse of an anti-dumping measure. It also implies that anti-dumping duties have been used as a tool for trade remedy.
  • Topic: International Political Economy, International Trade and Finance
  • Political Geography: China
  • Author: XIAO Yingying, YUAN Zhengqing
  • Publication Date: 07-2016
  • Content Type: Working Paper
  • Institution: Institute for World Economics and Politics
  • Abstract: The internet history in Africa is short, but this new technology is spreading fast on the continent. Along with this, cybercrime in Africa is becoming increasingly rampant, while the relevant legal institutions and law enforcement capacity are lagging behind, with public and private cyber security awareness being relatively weak. In recent years, African countries start accelerating the design of institutional framework concerning cyber security governance. Besides e-transaction and cybercrime, personal data protection is also part of Africa’s cyber security governance, which is the result of the “impartment“ from Western developed countries and the active advocacy from NGOs. Whether at the national level, sub-regional organization level, the African Union level or NGO level, those Western developed countries and western-dominated international organizations have played a role in the institutional design of African cyber security governance, some of which referred to or even copied the original designs of the Western countries. This may lead to the African continent being “recolonized” in cyberspace, with no autonomous decision-making power in global cyber security governance. Besides, from design to implementation, African countries still have a long way to go, and whether the institutions based on the western experience are suitable for the culture and ideas of the African countries, remains to be tested with practice.
  • Topic: International Relations, International Affairs
  • Political Geography: Africa, China
  • Author: Maxine Builder
  • Publication Date: 01-2015
  • Content Type: Working Paper
  • Institution: Atlantic Council
  • Abstract: Growing rates of antimicrobial resistance (AMR) pose a threat to public health that could undo many of the medical advances made over the last seventy years, eroding the global medical safety net and posing a significant threat to national security. Diseases once eliminated by a single course of antibiotics show drug resistance, often to several different classes of drugs. Some of the implications of increasing rates of AMR are intuitive, such as longer duration of illness, extended hospital stays, and higher rates of mortality. But other effects of a postantibiotics world are less obvious, such as the inability to perform life-saving operations or the ability for a simple scratch on the arm to kill. Humanity could soon find itself living in a reality in which communicable diseases such as tuberculosis, cholera, pneumonia, and other common infections cannot be controlled. This potentially catastrophic problem still can be abated, and the global health community, including the World Health Organization (WHO), has highlighted AMR as a priority in global health. But all sectors of the international community, not simply those in public health, need to take immediate steps to reverse the current trends and eliminate the systematic misuse of antimicrobial drugs, especially in livestock, and restore the pipeline of new antimicrobial drugs. The significant health and economic costs of AMR are difficult to quantify due to incomplete data that often underreports the extent of the problem, since there are no standard metrics or consensus on methodology to measure rates of AMR. But even the piecemeal statistics that exist paint a bleak picture. In a 2013 report, the US Centers for Disease Control and Prevention (CDC) reports at least two million Americans acquire serious infections to one or more strains of AMR bacteria annually, and at least 23,000 people die of these infections.1 A 2008 study estimated the excess direct costs to the US medical system attributable to AMR infections at $20 billion, with additional estimated productivity losses to be as high as $35 billion.2 With the increase in resistant infections and continuing rise in medical costs, the cost to the American medical system no doubt also has increased. This trend is not a uniquely American problem; it is truly global in scope. The European Union (EU) reports about 25,000 deaths annually due to drug-resistant bacteria, at an overall, combined cost of $2 billion in healthcare costs and productivity losses.3 There were over 14.7 million incidents of moderate-to-severe adverse reactions to antibiotics each year between 2001 and 2005 in China. Of these, 150,000 patients died annually.4 The most recent available data on China estimates that treatment of AMR infections during that same time period cost at least $477 million, with productivity losses of more than $55 million each year.5 A 2005 study of the United Kingdom (UK) found that the real annual gross domestic losses due to AMR were between 0.4 and 1.6 percent.6 Although slightly outdated, this estimate may be a useful guide in assessing the global impact of AMR, and given the trend of increasing resistance, it is likely that the impact will also increase accordingly. That said, it is prudent to repeat that the disparities in the quality of data reporting standards across China, the United States, the United Kingdom, and the European Union make it difficult to directly compare the severity of the impacts AMR has on each entity. The primary cause of AMR globally is antibiotic overuse and misuse, be it from doctors inappropriately prescribing antibiotics to treat viral infections or individuals seeking over-the-counter antibiotics for self-treatment. But another driver, less obvious than overuse in humans, is the use of antimicrobials in livestock, and the ratio of use in animals as compared to humans is astounding. In the United States, about 80 percent of all antibiotics are consumed in either agriculture or aquaculture. Generally, these drugs are administered to livestock as growth promoters and are medically unnecessary. Resistance in livestock quickly spreads to humans, and many community-acquired infections are the result of a contaminated food supply. Although most infections are acquired in the community, most deaths attributed to resistant infections occur in healthcare settings, and healthcare-acquired (or nosocomial) infections are another driver of AMR. At this point, AMR does not pose an immediate and direct threat to national security. Rather, this is a creeping global security crisis. If current trends continue, these drugs upon which the world relies will lose effectiveness. The gains made in fighting infectious diseases will be reversed, and a wide range of routine surgeries and easily treatable infections will become much more dangerous and deadly. This will cause the health of the world's working population to deteriorate, and the economic productivity and social cohesion of the globe to decline. At any time, a “black swan” event—triggered by an outbreak of drug-resistant tuberculosis, cholera, or pneumonia, for example—could prove catastrophic, endangering the fabric of societies and our globalized economy, forcing a stop to international trade and travel to prevent further spread. The issue of AMR is a tragedy of the commons in which individual incentives lead to the overuse and eventual destruction of a shared resource. International cooperation is required to walk back from this ledge and avoid a postantibiotics world, even though it is impossible to completely reverse the damage already done.
  • Topic: Health, National Security, Infectious Diseases, Health Care Policy
  • Political Geography: United States, China, United Kingdom, America, Europe
  • Author: David J. Berteau, Gregory Sanders, T.J. Cipoletti, Meaghan Doherty, Abby Fanlo
  • Publication Date: 01-2015
  • Content Type: Working Paper
  • Institution: Center for Strategic and International Studies
  • Abstract: The European defense market, though impacted by lethargic economic growth and painful fiscal austerity measures, continues to be a driver in global defense. Five of the fifteen biggest military spenders worldwide in 2013 were European countries, and Europe remains a major market for international arms production and sales. Surges in military spending by Russia, China, and various Middle Eastern countries in recent years has augmented the defense landscape, especially as European countries in aggregate continue to spend less on defense and the United States embarks on a series of deep-striking budget cuts. This report analyzes overall trends in defense spending, troop numbers, collaboration, and the European defense and security industrial base across 37 countries. To remain consistent with previous reports, this briefing utilizes functional NATO categories (Equipment, Personnel, Operations and Maintenance, Infrastructure, and Research and Development) and reports figures in constant 2013 euros unless otherwise noted. Many of the trends identified within the 2012 CSIS European Defense Trends report continued into 2013, namely reductions in topline defense spending, further cuts to R spending, and steadily declining troop numbers. Though total European defense spending decreased from 2001-2013, with an accelerated decline between 2008 and 2010, select countries increased spending2 between 2011 and 2013. Collaboration among European countries has decreased in the R category; however, it has increased in the equipment category – indicating increased investment in collaborative procurement. Defense expenditure as a percentage of total government expenditure has decreased across Europe from 2001-2013 with the exceptions of Albania and Estonia. An updated CSIS European Security, Defense, and Space (ESDS) Index is included within this report and exhibits a shift in geographic revenue origin for leading European defense firms away from North America and Europe and towards other major markets between 2008 and 2013. Finally, a brief analysis of Russian defense spending is included in the final section of this report in order to comprehend more fully the size and scope of the European defense market within the global framework. In 2013, Russia replaced the United Kingdom as the third largest global defense spender, devoting 11.2 percent of total government expenditures to defense. This briefing report concludes with summarized observations concerning trends in European defense from 2001 to 2013. CSIS will continue to follow and evaluate themes in European defense, which will appear in subsequent briefings.
  • Topic: Security, Defense Policy, Military Affairs, Budget
  • Political Geography: Russia, China, United Kingdom, America, Europe
  • Author: Anthony H. Cordesman, Aaron Linn
  • Publication Date: 03-2015
  • Content Type: Working Paper
  • Institution: Center for Strategic and International Studies
  • Abstract: The tensions between the Koreas – and the potential involvement of the People's Republic of China (China or PRC), Japan, Russia, and the United States of America (US) in a Korean conflict – create a nearly open-ended spectrum of possible conflicts. These conflicts could range from posturing and threats – “wars of intimidation” – to a major conventional conflict on the Korean Peninsula, intervention by outside powers like the US and China, and the extreme of nuclear conflict.
  • Political Geography: Russia, United States, Japan, China, Korea, Northeast Asia
  • Author: Zheng Liansheng
  • Publication Date: 03-2015
  • Content Type: Working Paper
  • Institution: Centre for International Governance Innovation
  • Abstract: The shadow banking system was defined in 2007 by Paul McCulley, the managing director of Pacific Investment Management Company, but it began to receive significant attention in the immediate aftermath of the GFC. Since the beginning of the financial crisis in 2008, the regulatory agencies of different countries, international organizations and think tanks have all carried out in-depth research into shadow banking and have released a series of results. Regulatory reforms have also addressed shadow banking, the most important of which is the US Dodd-Frank Act of 2010, which aims to restrain the expansion and risk taking of shadow banking in the United States. The United Kingdom and the European Union have also adopted reforms and built up a supervisory system to track the risks of the shadow banking system.
  • Topic: Financial Crisis
  • Political Geography: United States, China, United Kingdom, Europe
  • Author: Ming Zhang
  • Publication Date: 03-2015
  • Content Type: Working Paper
  • Institution: Centre for International Governance Innovation
  • Abstract: Due to the 2008-2009 global financial crisis, the Chinese government began to promote renminbi (RMB) internationalization in order to raise its international status, decrease reliance on the US dollar (USD) and advance domestic structural reform. RMB internationalization has achieved progress not only in cross-border trade settlement, but also in the offshore RMB markets. However, the rampant cross-border arbitrage and the relatively slow development of RMB invoicing compared to RMB settlement are becoming increasingly problematic. RMB internationalization has exerted significant influence on not only the Chinese economy but also other emerging market economies. RMB internationalization complicates domestic monetary policy, exacerbates the currency mismatch on China's international balance sheet and increases both the scale and volatility of short-term capital flows. It offers emerging economies another alternative for pricing domestic currency and investing foreign exchange reserves. Its overall impact on the international monetary system's stability will depend on how the capital account is liberalized and the consistency and transparency of Chinese monetary policy. This paper concludes with five recommendations for Chinese policy makers to promote RMB internationalization in a sustainable way that is conducive to international stability.
  • Topic: Development, Economics, Government
  • Political Geography: United States, China
  • Author: John Whalley
  • Publication Date: 02-2015
  • Content Type: Working Paper
  • Institution: Centre for International Governance Innovation
  • Abstract: The China (Shanghai) Pilot Free Trade Zone (SPFTZ) founded in September 2013, is a trial for China's new round of “reform and opening up” (China.org.cn 2008). The SPFTZ has promised liberalization on capital account and trade facilitation as its main objectives. This paper discusses reasons why China needs such a pilot zone after three decades of economic development, examines the differences between the SPFTZ and other free trade zones (FTZs) and highlights the developments of the SPFTZ since its inception. The SPFTZ's initial impressions are assessed, especially its impact on the opening of China's capital account and financial liberalization. The hope is that the success of the SPFTZ, and more pilot policies replicated in China, will give rise to a more balanced Chinese economy in the following decade.
  • Topic: Development, Economics
  • Political Geography: China