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261. Monetary Effects of Global Stablecoins

Author:
Dong He
Publication Date:
06-2021
Content Type:
Journal Article
Journal:
The Cato Journal
Institution:
The Cato Institute
Abstract:
The globalized economy now moves at the speed of electrons — and the future of money is inexorably going digital, too. New forms of digital money, such as central bank digital currencies (CBDCs) and so‐​called global stablecoins, are shaping the future of money and payments. CBDCs are a digital form of fiat currency issued by a central bank. Some central banks started exploring CBDCs a few years ago, and those explorations have gathered momentum since Facebook and its partners announced their intention to launch the Libra stablecoin in June 2019. Because the stablecoins issued by large technological companies or platforms (Big Techs) have the potential to be adopted by businesses and households everywhere, they are called “global stablecoins,” or GSCs, in shorthand.
Topic:
Geopolitics, Global Political Economy, Money, Currency, and Trade
Political Geography:
Global Focus

262. China: Rise or Demise?

Author:
John Mueller
Publication Date:
05-2021
Content Type:
Commentary and Analysis
Institution:
The Cato Institute
Abstract:
China, even if it rises, does not present much of a security threat to the United States. Policymakers increasingly view China’s rapidly growing wealth as a threat. China currently ranks second, or perhaps even first, in the world in gross domestic product (although 78th in per capita GDP), and the fear is that China will acquire military prowess commensurate with its wealth and feel impelled to carry out undesirable military adventures. However, even if it continues to rise, China does not present much of a security threat to the United States. China does not harbor Hitler‐​style ambitions of extensive conquest, and the Chinese government depends on the world economy for development and the consequent acquiescence of the Chinese people. Armed conflict would be extremely—even overwhelmingly—costly to the country and, in particular, to the regime in charge. Indeed, there is a danger of making China into a threat by treating it as such and by engaging in so‐​called balancing efforts against it. Rather than rising to anything that could be conceived to be “dominance,” China could decline into substantial economic stagnation. It faces many problems, including endemic (and perhaps intractable) corruption, environmental devastation, slowing growth, a rapidly aging population, enormous overproduction, increasing debt, and restive minorities in its west and in Hong Kong. At a time when it should be liberalizing its economy, Xi Jinping’s China increasingly restricts speech and privileges control by the antiquated and kleptocratic Communist Party over economic growth. And entrenched elites are well placed to block reform. That said, China’s standard of living is now the highest in its history, and it’s very easy to envision conditions that are a great deal worse than life under a stable, if increasingly authoritarian, kleptocracy. As a result, the Chinese people may be willing to ride with, and ride out, economic stagnation should that come about—although this might be accompanied by increasing dismay and disgruntlement. In either case—rise or demise—there is little the United States or other countries can or should do to affect China’s economically foolish authoritarian drive except to issue declarations of disapproval and to deal more warily. As former ambassador Chas Freeman puts it, “There is no military answer to a grand strategy built on a non‐​violent expansion of commerce and navigation.” And Chinese leaders have plenty of problems to consume their attention. They scarcely need war or foreign military adventurism to enhance the mix. The problem is not so much that China is a threat but that it is deeply insecure. Policies of threat, balance, sanction, boycott, and critique are more likely to reinforce that condition than change it. The alternative is to wait, and to profit from China’s economic size to the degree possible, until someday China feels secure enough to reform itself.
Topic:
Government, GDP, Geopolitics, and Economic Growth
Political Geography:
China, Asia, and United States of America

263. Eyes on the Prize: Australia, China, and the Antarctic Treaty System

Author:
Claire Young
Publication Date:
02-2021
Content Type:
Policy Brief
Institution:
Lowy Institute for International Policy
Abstract:
Australia’s interests in Antarctica are better served by the Antarctic Treaty System (ATS) than anything we could negotiate today. We should redouble our commitment to its ideals of science-driven, rules-based management — and counter the narrative of ATS ‘failure’. China is pushing the boundaries of ATS practice by exploiting fisheries and tourism, and probably seeking access to Western technologies in Antarctica. And in the future, Beijing could lead a coalition of states seeking mineral riches that only China is likely to be capable of retrieving. Australia should watch China’s activities closely, but react cautiously. We should be wary of false analogies with the Arctic and not overreact to marginal military developments. We should shield the ATS from Australia–China tension and US–China competition.
Topic:
Science and Technology, Treaties and Agreements, Natural Resources, Tourism, Geopolitics, Fishing, and Coalition
Political Geography:
China, Asia, Australia, and Arctic

264. Mapping China's Tech Giants: Reining in China’s technology giants

Author:
Fergus Ryan, Audrey Fritz, and Daria Impiombato
Publication Date:
06-2021
Content Type:
Special Report
Institution:
Australian Strategic Policy Institute (ASPI)
Abstract:
Since the launch of ASPI ICPC’s Mapping China’s Technology Giants project in April 2019, the Chinese technology companies we canvassed have gone through a tumultuous period. While most were buoyed by the global Covid-19 pandemic, which stimulated demand for technology services around the world, many were buffeted by an unprecedented onslaught of sanctions from abroad, before being engulfed in a regulatory storm at home. The environment in which the Chinese tech companies are operating has changed radically, as the pandemic sensitised multiple governments, multilateral groups and companies to their own critical supply-chain vulnerabilities. The lessons about national resilience learned from the pandemic are now being applied in many sectors, including the technology sector, where a trend towards decoupling China and the West was already well underway. As the geopolitical rivalry between the US and China has heightened, both sides increasingly see any reliance on the other for strategic commodities, such as rare-earth minerals and semiconductors, as dangerous vulnerabilities.
Topic:
Science and Technology, Bilateral Relations, Geopolitics, COVID-19, and Supply Chains
Political Geography:
China and Australia

265. North of 26 degrees south and the security of Australia: Views from The Strategist Volume 3

Author:
John Coyne and Teagan Westendorf
Publication Date:
05-2021
Content Type:
Special Report
Institution:
Australian Strategic Policy Institute (ASPI)
Abstract:
The Northern Australia Strategic Policy Centre’s latest report, North of 26° South and the Security of Australia Volume 3’, is an all-new series of articles by a range of authors exploring the continued importance of Northern Australia to national security and defence strategy. This Volume’s contributions were written over a year in which increased strategic uncertainty and an unprecedented global pandemic have collectively generated an interest in revisiting old policy assumptions. Right from the start, it was clear that we need to think of the north as the middle of the region, rather than the edge of Australia, and reflect that critical role in Australia’s political, military and economic strategies moving forward. The economic, social and geopolitical effects of Covid-19 have presented opportunities for a radical a rethinking of nation-building in the north, and collaboration between the public and private sectors to support it. The rise of Chinese influence in the region and globally has changed Australia’s role in the Indo-Pacific and the strategic significance of Australia’s defence capabilities and alliances to the broader international community. The pandemic response and geopolitical tensions have highlighted supply-chain resilience as a key area of capability uplift for Australia, making the north significant both as the key trade hub with region and a source of natural resource exports. The report builds on the previous Volumes of North of 26° South by broadening the breadth and depth of its contributions northern Australia strategic policy. This report provides much needed contemporary analysis and the criticality of the North to Australia’s national security and defence.
Topic:
Security, Defense Policy, Geopolitics, and COVID-19
Political Geography:
Australia

266. New game in the (post)covid Balkans?

Author:
Engjellushe Morina, Florian Bieber, Vuk Viksanovic, Jovana Marovic, Faruk Ajeti, and Vedran Dzihic
Publication Date:
03-2021
Content Type:
Video
Institution:
Austrian Institute for International Affairs (OIIP)
Abstract:
The global pandemic is changing the world. The Western Balkans were hit severely and are currently struggling with the rapid increase in numbers of Covid-19 infections. The state-of-the-play in the region is shaped by the dynamics of the pandemics but also by underlying structural problems, by the “return of geopolitics’ in the Balkans and question marks put behind the EU-Enlargement and new transatlantic relations. What we see at display right now is a sort of 'vaccine nationalism' threatening to replace the European solidarity. We see China rapidly increasing its influence, EU struggling to find a strong common policy towards the region and new expectations (for some) or even fears (for some others) related to the new Biden Administration. The debate seeks to explore this new game in the (post)covid Balkans. Are non-Western players using the pandemic with their ‘vaccine politics’ to fill Western’s gap or to challenge Western’s influence in the Balkans? What is the role of the EU and what the future prospects for enlargement? Will China’s increased influence in the Western Balkans hinder its transatlantic aspirations? How will the Biden administration meet the new challenges in the region? In cooperation with the Ministry of Defense (bmlv), the Austrian Marshall Plan Foundation, and the European Council on Foreign Relations (ECFR)
Topic:
Geopolitics, Transatlantic Relations, Vaccine, Pandemic, and COVID-19
Political Geography:
China, Europe, and Balkans

267. The Geopolitics of Renewable Hydrogen

Author:
Nicola De Blasio and Fridolin Pflugmann
Publication Date:
05-2021
Content Type:
Policy Brief
Institution:
Belfer Center for Science and International Affairs, Harvard University
Abstract:
The transition to a low-carbon energy system will likely shake up the geopolitical status quo that has governed global energy systems for over a century. Policymakers need to rethink the role their country could play in a new energy world. Renewables are widely perceived as an opportunity to shatter the hegemony of fossil fuel-rich states and democratize the energy landscape. Virtually all countries have access to some renewable energy resources (especially solar and wind power) and could thus substitute foreign supply with local resources. Our research shows, however, that the role countries are likely to assume in decarbonized energy systems will be based not only on their resource endowment but also on their policy choices. Renewable hydrogen is enjoying growing political and commercial momentum as a versatile and sustainable energy carrier with the potential to play a key role in the global transition to a low-carbon economy; and it is often described as the ‘missing link’ in global decarbonization—especially for energy intensive sectors where emissions are hard to abate and electrification is not the preferred solution, such as steel production, high-temperature industrial heat, shipping, aviation, and heat for buildings. But making renewable hydrogen a significant part of the world’s future energy mix will require defining new and innovative national and international policies while developing appropriate market structures aimed at spurring innovation along value chains; scaling technologies while significantly reducing costs; and deploying enabling infrastructure at scale. Success is possible, but this transformational effort will require close coordination between policy, technology, capital, and society to avoid falling into the traps and inefficiencies of the past. Renewable hydrogen can be used for both mobility and stationary applications. As a sustainable mobility energy carrier, it can power fuel-cell electric vehicles or be the base for synthetic fuels. In stationary applications, it can be used to store renewable energy, both at utility scale or off-grid, providing backup to intermittent renewable energy sources and serving as a carbon-free heating source. From a geopolitical perspective, whether future renewable hydrogen energy systems will be as concentrated as today’s oil and gas supply or decentralized like renewables is strongly related to future market structures, technology, and enabling infrastructure availability.
Topic:
Security, Energy Policy, Science and Technology, Geopolitics, Renewable Energy, and Hydrogen
Political Geography:
Global Focus

268. The Russian Northern Fleet – Extended Status and Geopolitical Ambitions

Author:
Giorgi Surmava
Publication Date:
01-2021
Content Type:
Special Report
Institution:
Georgian Foundation for Strategic International Studies -GFSIS
Abstract:
On December 21, 2020, by Decree #803 of the President of the Russian Federation, the Northern Fleet became the only one throughout the history of Russia to have the authority of a military district. In particular, the decree states that in order to ensure the integrity and inviolability of the territory of the Russian Federation, the Northern Fleet should be considered a strategic-territorial interdisciplinary union of the Armed Forces of the Russian Federation which has the tasks of a military district. The Northern Fleet is responsible for the largest territorial zone of Russia. This territory is mostly an ice desert which has strategic importance for Russia. It runs along the North Sea Route which is 7,300 nautical miles from Yokohama to Rotterdam (11,200 nautical miles through the Indian Ocean). In addition, this territory contains a large supply of hydrocarbons and other mineral or marine resources. The shorter lines between the US and Russian strategic missiles and their intended targets also pass through this area.
Topic:
Natural Resources, Military Affairs, Geopolitics, and Navy
Political Geography:
Russia, Eurasia, and Georgia

269. Baku Parade Whispers Geopolitical Complexities in the South Caucasus

Author:
Rahim Rahimov
Publication Date:
01-2021
Content Type:
Commentary and Analysis
Institution:
Georgian Foundation for Strategic International Studies -GFSIS
Abstract:
Turkish president Recep Tayyip Erdogan attended a military parade in the Azerbaijani capital of Baku on December 10 to celebrate Azerbaijan’s victory over Armenia in the war over the Karabakh region that ended with the Russia-brokered armistice on November 9-10. The Russian historian, Andrey Zubov, describes the Baku parade as an occasion “rather to celebrate the birth of a new geopolitical alliance than the victory over Armenia”1 . Following the parade, Russia imposed a ban on tomato imports from Azerbaijan in its flagship manner and Russian peacekeepers attempted to do something around the town of Shusha in Karabakh resembling what they have done in Georgia: “borderization”. Azerbaijani state TV, other media outlets and public figures widely and explicitly condemned such behavior of the Russian peacekeepers as a jealous response to the parade demonstration of Armenia’s Russian-made weapons and military equipment captured by the Azerbaijani armed forces or destroyed using Turkish-made Bayraktar drones . Erdogan and the Azerbaijani President, Ilham Aliyev, watched Turkish soldiers march alongside with Azerbaijanis on the central streets of Baku to the joy of local residents who took to the streets despite the COVID-19 related restrictions in order to salute them. This scene shows a major Russian weakness vis-àvis Turkey in Azerbaijan. Unlike Moscow, whose perception in Azerbaijan is controversial, Ankara enjoys nation-wide support. Recently leaked Russian secret files reveal that it is much more difficult for Moscow to develop proRussian civil society organizations and soft power instruments in Azerbaijan than even in staunchly pro-Western Georgia.
Topic:
Foreign Policy, Geopolitics, and Conflict
Political Geography:
Russia, Iran, Turkey, France, Georgia, and South Caucasus

270. The Regional Security Dynamics of the South Caucasus After the 2020 Karabakh War

Author:
Benyamin Poghosyan
Publication Date:
01-2021
Content Type:
Commentary and Analysis
Institution:
Georgian Foundation for Strategic International Studies -GFSIS
Abstract:
The 2020 Karabakh war has significantly shifted the geopolitics of the South Caucasus. Armenia suffered a tough defeat while the non-recognized Republic of Artsakh (Republic of Nagorno Karabakh) lost almost 80 percent of its territories. Azerbaijan won a decisive victory and took not only territories outside of the former Nagorno Karabakh Autonomous Region (NKAR) but 30 percent of NKAR itself. The November 10 trilateral statement signed by Armenia, Azerbaijan and Russia not only stopped the war in Karabakh but ushered in a new era in regional geopolitics.1 The key features of the new status quo are the increased role of Russia and Turkey and the significant reduction of Western involvement. However, the South Caucasus is far away from stability and, most probably, volatility will continue. We will seek to analyze the main interests of the key regional and external players and what may play out in a short/mid-term perspective.
Topic:
Foreign Policy, War, Geopolitics, Political stability, and Conflict
Political Geography:
Russia, Armenia, Azerbaijan, and Nagorno-Karabakh