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  • Author: Hongying Wang
  • Publication Date: 03-2016
  • Content Type: Working Paper
  • Institution: Centre for International Governance Innovation
  • Abstract: In recent years, the world has seen rapid growth in China’s financial reach beyond its borders. Following the announcement of a “going out” strategy at the turn of the century, many Chinese enterprises have ventured to invest and operate abroad. After three decades as primarily a recipient of foreign direct investment (FDI), China has now emerged as a major FDI-originating country as well. Much of China’s foreign aid is closely entangled with its outgoing FDI, and it has also been rising. Since 2013, the Chinese government has been pushing for a new One Belt, One Road (OBOR) initiative, aiming to connect China with countries along the ancient Silk Road and a new Maritime Silk Road via infrastructure investment. In addition, since 2009, China has actively promoted the internationalization of its currency, the renminbi (RMB). There has been a great deal of anxiety about the motivations behind China’s going out policy and its possible international consequences. Many view it as an expression of China’s international ambition and a strategy that threatens the existing international order; however, that is not the whole story. An equally important but often less understood issue is the role of China’s domestic politics and political economy in shaping its new activism in foreign financial policy. Moreover, it is unclear how successful the going out policy is. The complexity of China’s going out policy was the topic for a recent round table discussion hosted by the Centre for International Governance Innovation and the Foreign Policy Institute at the School of Advanced International Studies of Johns Hopkins University in Washington, DC.[1] Participants discussed a number of issues around two broad themes: the impact of domestic political economy on China’s foreign economic policy and the challenges for China’s external financial strategy — in particular, its OBOR initiative.
  • Topic: Markets, Political Economy, Monetary Policy, Infrastructure, Foreign Direct Investment, Financial Markets
  • Political Geography: China
  • Author: Saul P. Limaye, Tsutomu Kikuchi
  • Publication Date: 01-2016
  • Content Type: Working Paper
  • Institution: East-West Center
  • Abstract: Until recently, Southeast Asia had not been a region of sustained focus for the US-Japan relationship. But the situation is changing. The international relations of the Asia-Pacific is becoming more "multipolarized." This requires the US and Japan to think about the future of the region beyond the issue of US-China relations, which has preoccupied past discussions. A number of nations and institutions in the Asia-Pacific region will substantially affect the region's future. Southeast Asian nations and the Association of Southeast Asian Nations (ASEAN) are among them. A new era of more coordinated, sustained, and combined commercial and security involvement by the US and Japan in Southeast Asia may be at hand. In light of these changes, the East-West Center in Washington (EWCW), in collaboration with the Japan Institute of International Affairs (JIIA), and through the support of the Sasakawa Peace Foundation (SPF), initiated a dialogue with Southeast Asians about their perspectives on how the US-Japan relationship and alliance could or should approach cooperation with the region.
  • Topic: Security, Economics, Markets, Peacekeeping
  • Political Geography: United States, Japan, China, Asia-Pacific
  • Author: Dieter Ernst
  • Publication Date: 03-2016
  • Content Type: Working Paper
  • Institution: East-West Center
  • Abstract: This paper explores what we know about possible employment effects of the 10-year plan, issued by the State Council on May 19, 2015, entitled Made in China 2025. MIC2025 was designed to address China’s emerging labor shortage challenge. To achieve this goal, the plan seeks to boost labor productivity through an increased use of robots and through network-based upgrading of the entire industrial value chain and related services. How might the projected increase in labor productivity affect the creation and quality of jobs in China? Will China’s push into advanced manufacturing now move the country’s manufacturing employment closer to the pattern of “employment de-industrialization” observed in the US and other industrialized countries? How China will cope with the advanced manufacturing challenge for employment will have major implications not only for the US and other industrialized countries, but also for emerging economies and, most importantly for the majority of developing countries that are still struggling as latecomers to labor-intensive industrial manufacturing. The paper lays out objectives of the MIC 2025 plan and highlights a failure of Chinese policy makers to take into account employment effects and other labor market issues when they design their grand visions of industrial policy. The paper finds that until 2014, manufacturing has acted as an employment absorber in China. However new data on unemployment, labor force participation and income inequality signal that China may now be moving towards an “employment de-industrialization” pattern, unless enough knowledge-intensive service jobs will be created in China’s growing information economy. The paper concludes with implications for policy and further research.
  • Topic: Economics, International Political Economy, Markets, Labor Issues
  • Political Geography: China
  • Author: Wei Wang, Gemma Estrada, Jurgen Conrad, Sang-Hyop Lee, Donghyun Park
  • Publication Date: 05-2016
  • Content Type: Policy Brief
  • Institution: East-West Center
  • Abstract: As demand from global markets declines, slowing exports of manufactured goods from the People's Republic of China means the country must increasingly rely on domestic markets for growth. Unlike manufactured goods, services—those "intangible" products that include everything from transportation to scientific research to real estate services—are geared more toward domestic markets. Services, then, will be key to the rebalancing process. However, while the service sector has grown rapidly in the PRC, it continues to lag behind other countries at similar stages of development. In addition, the sector is dominated by traditional low-end types of services, rather than knowledge-intensive services. Heavy regulatory burdens, barriers to trade in services, and an unfavorable policy environment have been major obstacles to upgrading the sector and improving its competitiveness. Policy reform should focus on strengthening competition to raise productivity, with the goal of increasing not only the number of jobs and contribution to GDP, but also of positioning the service sector to compete internationally and spur export growth.
  • Topic: International Trade and Finance, Markets, Political Economy, Reform, GDP
  • Political Geography: China
  • Author: Wei Wang, Gemma Estrada, Jurgen Conrad, Sang-Hyo Lee, Donghyun Park
  • Publication Date: 05-2016
  • Content Type: Policy Brief
  • Institution: East-West Center
  • Abstract: As demand from global markets declines, slowing exports of manufactured goods from the People's Republic of China means the country must increasingly rely on domestic markets for growth. Unlike manufactured goods, services—those "intangible" products that include everything from transportation to scientific research to real estate services—are geared more toward domestic markets. Services, then, will be key to the rebalancing process. However, while the service sector has grown rapidly in the PRC, it continues to lag behind other countries at similar stages of development. In addition, the sector is dominated by traditional low-end types of services, rather than knowledge-intensive services. Heavy regulatory burdens, barriers to trade in services, and an unfavorable policy environment have been major obstacles to upgrading the sector and improving its competitiveness. Policy reform should focus on strengthening competition to raise productivity, with the goal of increasing not only the number of jobs and contribution to GDP, but also of positioning the service sector to compete internationally and spur export growth.
  • Topic: Economics, Markets, Reform, GDP
  • Political Geography: China
  • Author: Nicholas Borst, Nicolas R. Lardy
  • Publication Date: 08-2015
  • Content Type: Working Paper
  • Institution: Peterson Institute for International Economics
  • Abstract: China's banking system is now the largest in the world, and its capital markets are rapidly approaching the size of those in the advanced economies. Borst and Lardy trace the evolution of China's financial system away from a traditional bank-dominated and state-directed financial system toward a more complex, market-based system. They analyze and outline the optimal sequence of financial reforms needed to manage the new risks accompanying this evolution.
  • Topic: Economics, Markets, Financial Crisis, Reform
  • Political Geography: China
  • Author: Christopher McNally, Boy Lüthje
  • Publication Date: 09-2015
  • Content Type: Working Paper
  • Institution: East-West Center
  • Abstract: The global financial crisis of 2008-09 led to a policy consensus in China that its socioeconomic development model needed rebalancing. China's rapid development has been based on extensive growth reliant on exports, low wages, environmental exploitation, and the manufacturing of cheap products. China's current plans identify paths to economic rebalancing through intensive growth driven by rising investment in new technologies and manufacturing processes, improved wages and skills, and improved worker and environmental protections. Two industries, automotive and information technology, demonstrate the experience of and opportunities for rebalancing. Both offer improved employment conditions with better wages, but continue to incorporate large swaths of low-wage employment with little protection for workers' health and the environment. Economic rebalancing in China, therefore, has so far only appeared in pockets. Institutional safeguards for wages and labor standards remain constrained by powerful alliances among multinational corporations, Chinese state-owned/private enterprises, and the Chinese state.
  • Topic: Economics, Markets, Science and Technology, Labor Issues, Financial Crisis
  • Political Geography: China
  • Author: Jon Dorsch
  • Publication Date: 09-2015
  • Content Type: Policy Brief
  • Institution: East-West Center
  • Abstract: At the end of 2015 the Association of Southeast Asian Nations (ASEAN) will announce the establishment of the ASEAN Economic Community (AEC). In theory, this agreement should produce an association-wide economic integration. However, following the announcement, and for the foreseeable future, ASEAN member states will continue in significantly less than full regional economic integration. Why? Some observers believe that the AEC plans involve an "overly ambitious timeline and too many ill-thought-out initiatives." Others point to ASEAN's traditional aversion to legally binding agreements. While progress has been made in reducing or eliminating intra-ASEAN trade tariffs, substantial non-tariff barriers to trade persist. However, for most member states, the ASEAN market is relatively small while external markets, especially China, are growing rapidly. Given this outward-orientation for ASEAN trade, is the lack of an unhindered regional market really a problem?
  • Topic: Economics, International Trade and Finance, Markets
  • Political Geography: China, Asia
  • Author: Dieter Ernst
  • Publication Date: 10-2014
  • Content Type: Working Paper
  • Institution: East-West Center
  • Abstract: China's new strategy to upgrade its semiconductor industry (outlined in the "Guidelines to Promote National Integrated Circuit Industry Development," June 24, 2014), seeks to move from catching-up to forging ahead in semiconductors, by strengthening simultaneously China's integrated circuit (IC) design industry and domestic IC foundry services.
  • Topic: Economics, Globalization, Industrial Policy, Markets, Science and Technology
  • Political Geography: China, Asia
  • Author: John Whalley, Hejing Chen
  • Publication Date: 10-2014
  • Content Type: Working Paper
  • Institution: Centre for International Governance Innovation
  • Abstract: China, in the next few years, faces the prospect of major regional and bilateral trade negotiations possibly including the Trans-Pacific Partnership (TPP), the Regional Comprehensive Economic Partnership with the Association of Southeast Asian Nations (ASEAN) and Japan, Korea, India, Australia and New Zealand and separate negotiations with India, Korea and Japan, potentially the United States and even possibly the European Union. A likely key element in such negotiations, and one already raised by the United States in the TPP negotiations, is that of trade arrangements involving state-owned enterprises (SOEs). China is viewed from outside as having a large SOE sector, and large SOEs are viewed as having a protected monopoly position in domestic Chinese markets.
  • Topic: International Trade and Finance, Markets, World Trade Organization
  • Political Geography: Japan, China, Europe, India, Asia, Australia, Korea
  • Author: Gerald Stang
  • Publication Date: 03-2014
  • Content Type: Policy Brief
  • Institution: European Union Institute for Security Studies
  • Abstract: In 2012, China was the world's seventh biggest producer of natural gas, the fourth largest oil producer, and the biggest producer of hydroelectricity. It also produced almost as much coal as the rest of the world combined. Still, this is not enough. China's domestic energy bounty has long allowed the country to keep its overall import dependency relatively low but, as the country's economy continues to boom, its import dependency is growing quickly, particularly with regard to oil.
  • Topic: Economics, Energy Policy, International Cooperation, International Trade and Finance, Markets, Natural Resources
  • Political Geography: China, Asia
  • Author: Pierre Siklos, Martin T. Bohl, Jeanne Diesteldorf
  • Publication Date: 09-2014
  • Content Type: Policy Brief
  • Institution: Centre for International Governance Innovation
  • Abstract: This paper examines whether the introduction of Chinese stock index futures had an impact on the volatility of the underlying spot market. To this end, we estimate several Generalized Auto-Regressive Conditional Heteroscedasticity (GARCH) models and compare our findings for mainland China with Chinese index futures traded in Singapore and Hong Kong. Our results indicate that Chinese index futures decrease spot market volatility with all three spot markets considered. In contrast, we do not obtain the same results for the companion index futures markets in Hong Kong and Singapore. China's stock market is relatively young and largely dominated by private retail investors. Nevertheless, our evidence is favourable to the stabilization hypothesis usually confirmed in mature markets.
  • Topic: Economics, International Trade and Finance, Markets
  • Political Geography: China, Singapore
  • Author: Leo Abruzzese
  • Publication Date: 06-2013
  • Content Type: Working Paper
  • Institution: Economist Intelligence Unit
  • Abstract: After a series of setbacks, the global economy is slowly mending US economy is strengthening; star performer Jobs market is on a modest upswing Housing is bouncing back China is recovering from a slowdown Boom years are over, but so is the slump European debt crisis is stabilizing but austerity is killing the economy Euro zone remains big drag on global growth Japan is showing signs of recovery under a new government Central banks are supporting the bounce - back in a big way Don't expect a brisk recovery, though; many risks remains Debt levels still high; asset prices are volatile; tensions in Middle East, China, Kore and has stabilised in Europe, but at a low level. In Germany, manufacturing output is rising again.
  • Topic: Economics, International Trade and Finance, Markets, Monetary Policy, Infrastructure
  • Political Geography: United States, China
  • Author: Arvind Subramanian, Martin Kessler
  • Publication Date: 08-2013
  • Content Type: Working Paper
  • Institution: Peterson Institute for International Economics
  • Abstract: This paper describes seven salient features of trade integration in the 21st century: Trade integration has been more rapid than ever (hyperglobalization); it is dematerialized, with the growing importance of services trade; it is democratic, because openness has been embraced widely; it is criss-crossing because similar goods and investment flows now go from South to North as well as the reverse; it has witnessed the emergence of a mega-trader (China), the first since Imperial Britain; it has involved the proliferation of regional and preferential trade agreements and is on the cusp of mega-regionalism as the world's largest traders pursue such agreements with each other; and it is impeded by the continued existence of high barriers to trade in services. Going forward, the trading system will have to tackle three fundamental challenges: In developed countries, the domestic support for globalization needs to be sustained in the face of economic weakness and the reduced ability to maintain social insurance mechanisms. Second, China has become the world's largest trader and a major beneficiary of the current rules of the game. It will be called upon to shoulder more of the responsibilities of maintaining an open system. The third challenge will be to prevent the rise of mega-regionalism from leading to discrimination and becoming a source of trade conflicts. We suggest a way forward—including new areas of cooperation such as taxes—to maintain the open multilateral trading system and ensure that it benefits all countries.
  • Topic: Economics, Globalization, International Trade and Finance, Markets, Treaties and Agreements
  • Political Geography: China
  • Author: Nicholas Borst
  • Publication Date: 10-2013
  • Content Type: Policy Brief
  • Institution: Peterson Institute for International Economics
  • Abstract: The Chinese financial system has undergone almost continuous reform since the dismantling in the 1980s of the Soviet- style system where only one state-controlled bank existed. Government efforts to create a financial system that adheres to international best practices of commercial lending accelerated in the 1990s (box 1). Reforms progressed quickly during this period, but they were accompanied by excessive credit growth and a massive increase in nonperforming loans, threatening the solvency of some banks and the financial stability of the entire economy. The risk of these weaknesses was dramatized by the 1997 Asian financial crisis, in which several nearby countries were crippled by plunging currency values, rising interest rates and difficulties servicing their foreign-held debts.
  • Topic: Debt, Economics, International Trade and Finance, Markets, Financial Crisis
  • Political Geography: China
  • Author: Joseph E. Gagnon
  • Publication Date: 11-2013
  • Content Type: Policy Brief
  • Institution: Peterson Institute for International Economics
  • Abstract: There is a long-standing debate among economists and policymakers on the benefits of flexible versus fixed exchange rates (Klein and Shambaugh 2010). In principle, flexible exchange rates allow a country's central bank to focus on stabilizing economic growth and inflation, which are the ultimate goals of monetary policy. However, some argue that in practice central banks often do not use their powers wisely and it may be better to restrict their freedom by requiring them to peg their currency to that of an important trading partner. Others note that flexible exchange rates are far more volatile than fundamental factors can explain (Flood and Rose 1995), raising the possibility that they may introduce wasteful cross-sectoral fluctuations in economic activity. One common viewpoint is that flexible exchange rates may be fine for large countries but that the smallest countries are better off with fixed exchange rates (Åslund 2010).
  • Topic: Economics, Foreign Exchange, International Trade and Finance, Markets, Financial Crisis
  • Political Geography: United States, Japan, China, United Kingdom
  • Author: Nikia Clarke
  • Publication Date: 11-2013
  • Content Type: Policy Brief
  • Institution: Columbia Center on Sustainable Investment
  • Abstract: Energy investments and infrastructure contracts remain prominent in China's Africa engagement. However, investment in manufacturing makes up a significant proportion of Chinese outward foreign direct investment (FDI). Its characteristics–large numbers of smaller transactions by privately owned small and medium-sized firms–make these flows difficult to assess or control. However, China and African governments have an interest in effectively channeling this type of FDI.
  • Topic: Development, Economics, Industrial Policy, International Trade and Finance, Markets, Foreign Direct Investment
  • Political Geography: Africa, China
  • Author: Andrew B. Kennedy
  • Publication Date: 11-2013
  • Content Type: Course Pack
  • Institution: Center for the Advanced Study of India
  • Abstract: In recent decades, research and development has become a key new arena of globalization. Whereas multinational corporations once conducted R primarily in their home countries, it is now often dispersed across multiple locations around the world. Has this process transformed economic ties between the world's dominant state and its would-be rising powers in ways that imply an important power shift? Focusing on China and India's growing collaboration with the U.S., this paper argues that it has not. China and India remain considerably more reliant on the globalization of R than the U.S. does, and this remains a potential source of leverage for Washington. This vulnerability mainly reflects the fact that U.S. R investments in China and India are far more important for these two Asian countries than they are for the U.S. These investments loom larger in the Chinese and Indian innovation systems than they do in their American counterpart, and it is difficult to imagine any country substituting for the U.S. in this regard. In contrast, the U.S. cannot derive a great deal of leverage as a platform for R Both China and India are considerably less dependent on the U.S. in this respect.
  • Topic: Development, Economics, Globalization, International Trade and Finance, Markets
  • Political Geography: United States, China, India
  • Author: James Chen
  • Publication Date: 01-2012
  • Content Type: Working Paper
  • Institution: Institute for National Strategic Studies
  • Abstract: During the 9th century, Arab traders regularly plied lucrative maritime routes that connected the Persian Gulf to southern China by way of the Indian Ocean. This commercial activity, which mostly involved jade, silk, and other luxury goods, went on for centuries and became part of what is now known as the Silk Road. In some ways, the world is now witnessing a restoration of that ancient trading relationship between two civilizations—except that oil and consumer goods have replaced jade and silk.
  • Topic: Foreign Policy, International Trade and Finance, Markets, Foreign Direct Investment
  • Political Geography: China, Middle East, Arabia
  • Author: Qiong Zhang, Binzhen Wu, Xue Qiao
  • Publication Date: 01-2012
  • Content Type: Working Paper
  • Institution: Asia-Pacific Research Center
  • Abstract: This paper uses macro-level data between 1997 and 2008 to evaluate the effects of China's pharmaceutical price regulations. We find that these regulations had short-run effects on medicine price indexes, reducing them by less than 0.5 percentage points. The effects could have been slightly reinforced when these regulations were imposed on more medicines. However, these regulations failed to reduce household health expenditures and the average profitability of the pharmaceutical industry, and firms on the break-even edge were worse off. Finally, although these regulations have no significant effects on the price of substitutes or complements for medicines, they increased expensive medicine imports.
  • Topic: Economics, Health, Human Welfare, Industrial Policy, International Trade and Finance, Markets
  • Political Geography: China
  • Publication Date: 02-2012
  • Content Type: Working Paper
  • Institution: Economist Intelligence Unit
  • Abstract: Africa is drawing increasing attention, not only from the perspective of businesses based in China and Europe, but also from operators in Africa itself. In particular, closer economic ties between Africa and China have been covered extensively by the media recently—with fairly mixed reviews. This paper highlights the potential, challenges and risks for doing business in Africa over the next few years.
  • Topic: Development, International Trade and Finance, Markets, Foreign Aid, Foreign Direct Investment
  • Political Geography: Africa, China, Europe
  • Author: Arvind Subramanian, Aaditya Mattoo, Prachi Mishra
  • Publication Date: 03-2012
  • Content Type: Working Paper
  • Institution: Peterson Institute for International Economics
  • Abstract: This paper estimates the impact of China's exchange rate changes on exports of competitor countries in third markets, known as the "spillover effect." Recent theory is used to develop an identification strategy in which competition between China and its developing country competitors in specific products and destinations plays a key role. The variation is used—afforded by disaggregated trade data—across exporters, importers, product, and time to estimate this spillover effect. The results show robust evidence of a statistically and quantitatively significant spillover effect. Estimates suggest that, on average, a 10 percent appreciation of China's real exchange rate boosts a developing country's exports of a typical 4-digit Harmonized System (HS) product category to third markets by about 1.5 to 2 percent. The magnitude of the spillover effect varies systematically with product characteristics as implied by theory.
  • Topic: Development, Economics, Markets
  • Political Geography: China
  • Publication Date: 04-2012
  • Content Type: Working Paper
  • Institution: Economist Intelligence Unit
  • Abstract: Three years after the global economy reached its lowest point in three-quarters of a century, the recovery remains incomplete and the outlook uncertain. On March 9th 2009, the capitalisation of Morgan Stanley\'s global stockmarket index fell to US$26trn, nearly 60% below its 2007 peak. Today, the value of the world\'s stockmarkets has yet to return to the pre-crisis level—nor has the confidence of most consumers and businesses. The excesses of the last ten years—the personal debt accumulated early in the last decade and the public debt added during the recession—have saddled many countries with weak economic foundations and little or no resilience to shocks. This has left the US economy, in particular, struggling for a third straight year to lock in faster growth. It has left debt-ravaged Europe in recession and China manoeuvring unsteadily to deflate a bubble. On the brighter side, the global economy will grow again this year and the imbalances that built up over the past decade will continue to unwind. But global growth will be slower this year than last, and a host of risks—from elevated oil prices to war in the Middle East, to the collapse of Europe\'s single currency—will weigh on confidence and reduce spending and investment.
  • Topic: Economics, Globalization, Markets, Global Recession, Financial Crisis
  • Political Geography: United States, China, Europe, Middle East
  • Publication Date: 04-2012
  • Content Type: Working Paper
  • Institution: International Crisis Group
  • Abstract: The conflicting mandates and lack of coordination among Chinese government agencies, many of which strive to increase their power and budget, have stoked tensions in the South China Sea. Repeated proposals to establish a more centralised mechanism have foundered while the only agency with a coordinating mandate, the foreign ministry, does not have the authority or resources to manage other actors. The Chinese navy\'s use of maritime tensions to justify its modernisation, and nationalist sentiment around territorial claims, further compound the problem. But more immediate conflict risks lie in the growing number of law enforcement and paramilitary vessels playing an increasing role in disputed territories without a clear legal framework. They have been involved in most of the recent incidents, including the prolonged standoff between China and the Philippines in April 2012 in Scarborough Reef. Any future solution to the South China Sea disputes will require a consistent policy from China executed uniformly throughout the different levels of government along with the authority to enforce it.
  • Topic: Foreign Policy, Markets, Maritime Commerce
  • Political Geography: China, Israel
  • Author: Ted Piccone, Emily Alinikoff
  • Publication Date: 01-2012
  • Content Type: Working Paper
  • Institution: Center on International Cooperation
  • Abstract: As the emerging global order takes shape, debate is growing more intense around the trajectory of the rising powers and what their ascendency to positions of regional and international influence means for the United States, its traditional allies, and global governance more broadly. Commentary about these rising powers— often referred to in a generic way as the BRICS (Brazil, Russia, India, China, South Africa) but actually encompassing a dozen or so countries largely represented in the G-20—ranges from alarmist to sanguine. Pessimists argue that China, with its impressive economic growth and increasingly global reach, is well-positioned to challenge the United States' role of global superpower and to weaken the commitment of other rising powers, and various international organizations, to liberal values. More optimistic analysts insist that the rise of middle powers, most of which are democracies of varying stripes, bodes well for the world: millions are being lifted out of poverty, rule of law is taking hold and the international system is bound to be a more inclusive, representative one.
  • Topic: Democratization, Development, Economics, Globalization, Human Rights, International Trade and Finance, Markets, Poverty, Governance
  • Political Geography: Russia, United States, China, India, South Africa, Brazil, Arabia
  • Author: Dieter Ernst
  • Publication Date: 02-2012
  • Content Type: Working Paper
  • Institution: East-West Center
  • Abstract: For its proponents, America's voluntary standards system is a "best practice" model for innovation policy. Foreign observers however are concerned about possible drawbacks of a standards system that is largely driven by the private sector. There are doubts, especially in Europe and China, whether the American system can balance public and private interests in times of extraordinary national and global challenges to innovation.
  • Topic: Democratization, Economics, Globalization, International Trade and Finance, Markets, Governance
  • Political Geography: United States, China, Europe
  • Author: James A. Haley
  • Publication Date: 06-2012
  • Content Type: Working Paper
  • Institution: Centre for International Governance Innovation
  • Abstract: The G20 leaders meeting in Los Cabos confront a number of challenges. Most prominent among these is the state of the global economy, which remains dangerously unbalanced, and in which the balance of risks is clearly weighted on the downside. These risks emanate from several sources.
  • Topic: Economics, International Cooperation, International Organization, International Trade and Finance, Markets, Financial Crisis
  • Political Geography: China
  • Author: Shanker A. Singham
  • Publication Date: 10-2012
  • Content Type: Working Paper
  • Institution: Council on Foreign Relations
  • Abstract: The U.S. economy faces major challenges competing internationally. One of the most worrisome is the growing use in China and other advanced developing countries of anticompetitive market distortions (ACMDs)—including regulatory protection that privileges specific companies—which put foreign competitors at a disadvantage. ACMDs are government actions that give certain business interests artificial competitive advantages over their rivals, be they foreign or domestic, to the detriment of consumer welfare. These market distortions are especially damaging to the industries in which the United States enjoys the greatest comparative advantages, but they are also harmful to the long-term prosperity of developing economies and cost the global economy trillions of dollars. To combat ACMDs, the conventional trade policy approach of focusing on the The U.S. economy faces major challenges competing internationally. One of the most worrisome is the growing use in China and other advanced developing countries of anticompetitive market distortions (ACMDs)—including regulatory protection that privileges specific companies—which put foreign competitors at a disadvantage.1 ACMDs are government actions that give certain business interests artificial competitive advantages over their rivals, be they foreign or domestic, to the detriment of consumer welfare. These market distortions are especially damaging to the industries in which the United States enjoys the greatest comparative advantages, but they are also harmful to the long-term prosperity of developing economies and cost the global economy trillions of dollars.
  • Topic: Economics, Emerging Markets, Globalization, International Trade and Finance, Markets
  • Political Geography: Russia, United States, China, India, Brazil
  • Publication Date: 11-2012
  • Content Type: Working Paper
  • Institution: Economist Intelligence Unit
  • Abstract: Markets of the future—China, India, Brazil and Russia—will become the dominant retail markets l Africa, the final frontier—as BRIC opportunities diminish retailers will look to Africa as a driver of growth l Virtual marketplace— e-commerce, m-commerce and s-commerce—will transform the global retail landscape l Bricks and mortar will fight back as traditional retailers respond to change by integrating online with physical store offerings l Convenience will be king as shopping habits evolve into a multichannel approach rather than “one-stop shopping” l UK focus: polarised shopping habits could continue even when incomes recover, leading to an even greater squeeze on mid-market retail by 2022.
  • Topic: Economics, Emerging Markets, International Trade and Finance, Markets, Science and Technology, Communications
  • Political Geography: Russia, China, United Kingdom, India, Brazil
  • Author: Irwin M. Stelzer
  • Publication Date: 06-2012
  • Content Type: Working Paper
  • Institution: Hudson Institute
  • Abstract: Slow growth here and in China, and recession in Europe are reducing demand for oil. Inventories in the U.S. are at a 22-year high. The Federal Reserve Board's QEs that pumped paper money into the economy and drove up the nominal price of oil have come to an end. And the twelve OPEC oil cartelists, who between them supply 40% of the world's oil, are producing 1.6 million barrels in excess of the agreed daily quota of 30 million barrels. As a result, U.S. benchmark crude oil prices are now closer to $80 per barrel than to the $110 they reached only four months ago.
  • Topic: Economics, International Trade and Finance, Markets, Oil
  • Political Geography: United States, China, Europe
  • Author: Miguel Pérez Ludeña
  • Publication Date: 03-2012
  • Content Type: Policy Brief
  • Institution: Columbia Center on Sustainable Investment
  • Abstract: Chinese foreign direct investment (FDI) in Latin America is a recent phenomenon. Although the China National Petroleum Corporation and other companies have been present in Peru, Ecuador and Venezuela since the early 1990s, large projects have been pursued only since 2006, following an extended period of high commodity prices. The Economic Commission for Latin America and the Caribbean (ECLAC) estimated that there were US$ 15 billion of Chinese FDI inflows into Latin America in 2010, 90% of which were in extractive industries. This further contributed to the already high percentage of Chinese FDI flows to the region that are in natural resources. At a time of high economic growth fueled by commodity exports and strong currency appreciation (particularly in Brazil), FDI into extractive industries strengthens the region's specialization in primary products at the expense of manufacturing and other activities.
  • Topic: Economics, International Trade and Finance, Markets, Natural Resources, Foreign Direct Investment
  • Political Geography: China, Brazil, Latin America, Peru
  • Author: Karl P. Sauvant, Chen Zhao, Xiaoying Huo
  • Publication Date: 03-2012
  • Content Type: Policy Brief
  • Institution: Columbia Center on Sustainable Investment
  • Abstract: Among developing countries, China attracts most foreign direct investment (FDI). Where is this investment located within China, what explains its distribution and what are policy implications? We used UNCTAD's FDI Performance Index to answer the first question. Although developed for countries , it can be applied to sub-national units. It uses provincial GDP to ascertain whether a given territorial unit has received FDI inflows as expected from its economic size. Standardizing the data accordingly reveals three clusters of provinces for 2007-2010 (table 1, figure 1 below): The first cluster encompasses virtually all coastal provinces: they have an index value above 1, i.e. perform better than their economic size would lead one to expect. They account for 9 of the top 11 performers of Mainland China's 31 provinces, municipalities and autonomous regions (“provinces”). The provinces in the middle cluster underperform (index value of 1-0.5). They include 5 central provinces, but also 3 western and 2 coastal provinces. The provinces in the bottom cluster underperform significantly (index value below 0.5), comprising primarily the country's western provinces (8 out of the 10 provinces in this cluster).
  • Topic: Development, Economics, International Trade and Finance, Markets, Foreign Direct Investment
  • Political Geography: China
  • Author: Jane Nakano
  • Publication Date: 05-2012
  • Content Type: Policy Brief
  • Institution: East-West Center
  • Abstract: The United States, Japan, and the European Union—the three key consumers of Chinese rare earth materials—formally complained to the World Trade Organization (WTO) in March about Chinese restrictions on its rare earth exports. Several weeks later, China announced the establishment of a 150-plus member association with the official aim of promoting sustainable development within this sector. Some analysts wonder if this is part of a Chinese plan to circumvent international complaints by instituting an oligopolistic arrangement to control its rare earth exports. Others ask if this could be another step in an escalating dispute with China over the global supply of rare earth materials.
  • Topic: International Relations, Development, International Trade and Finance, Markets, Natural Resources
  • Political Geography: United States, Japan, China, Europe
  • Author: John Lee
  • Publication Date: 04-2012
  • Content Type: Policy Brief
  • Institution: East-West Center
  • Abstract: In a recent online article in Foreignpolicy.com, regular columnist and head of the Economic Strategy Institute, Clyde Prestowitz, argued that the next president of the World Bank should be Zhou Xiaochuan, Chairman of the People's Bank of China. For Prestowitz, it was not just Zhou's excellent credentials that made him ideal for the position, but also the fact that he is Chinese. China is accurately accused of “gaming” the global economic liberal order through its currency policies, restricted market access for outside firms and governments, and internal intervention in the economy to the detriment of foreign firms. But Prestowitz believes that such an appointment would significantly encourage China to behave as a “responsible stakeholder.” Behind this thinking is the argument that the more power, prestige, and authority China accumulates within the existing order, the more liberal Chinese economic policies will become.
  • Topic: Democratization, Economics, International Trade and Finance, Markets, Monetary Policy
  • Political Geography: China
  • Author: Michael McConnell
  • Publication Date: 03-2012
  • Content Type: Policy Brief
  • Institution: East-West Center
  • Abstract: ASEAN countries have long been an important international market for US agricultural exports. The United States, in 2011, exported almost $9.6 billion of agricultural products to ASEAN, making it the sixth-largest export destination for US farmers, ranchers, and agribusinesses—behind Japan ($14 billion) and just behind the European Union ($9.6 billion), but well ahead of South Korea ($7 billion). Moreover, the value of agricultural trade between the United States and ASEAN almost doubled between 2007 and 2011, with the top four ASEAN markets in 2011 for the United States being Indonesia ($2.8 billion), the Philippines ($2.1 billion), Vietnam ($1.7 billion), and Thailand ($1.3 billion). With a population of 614 million and strong economic growth, it is expected that ASEAN will continue to be an important market for US agricultural products. However, the United States is likely to face increasing competition, particularly from China, Australia, and New Zealand, all of which have free trade agreements (FTAs) with ASEAN.
  • Topic: Agriculture, Demographics, Economics, International Trade and Finance, Markets, Food
  • Political Geography: United States, China, Europe, East Asia, South Korea, Australia, Southeast Asia, New Zealand
  • Publication Date: 06-2012
  • Content Type: Policy Brief
  • Institution: Economist Intelligence Unit
  • Abstract: The global economy remains in precarious shape. Europe's debt crisis rages on, and although the euro appears to have survived its most recent test in the form of the Greek election on June 17th, austerity and financial-market uncertainty are depressing economic activity in Europe and, by extension, in much of the rest of the world. The Economist Intelligence Unit continues to expect global GDP growth to slow in 2012, and while our forecasts for the G3 economies—the US, euro zone and China—are essentially unchanged this month, we have cut our projections for Brazil and India.
  • Topic: Debt, Economics, International Trade and Finance, Markets, Financial Crisis
  • Political Geography: United States, China, Europe, India, Brazil
  • Author: Sandy Walker
  • Publication Date: 08-2012
  • Content Type: Policy Brief
  • Institution: Columbia Center on Sustainable Investment
  • Abstract: In its World Investment Report 2011, UNCTAD reported that liberalizing investment policy measures taken globally in 2010 outnumbered restrictive measures. Without the benefit of statistics, investors might have drawn the opposite conclusion, witnessing what appears to be a rising tide of national resistance to foreign takeovers: the Australian Foreign Investment Review Board's rejection of a takeover of the Australian Securities Exchange by the Singapore Exchange, Italian concern over a French company's takeover of dairy giant Parmalat and the US Government's requirement that Chinese company Huawei divest certain assets it had acquired from 3Leaf.
  • Topic: Economics, International Trade and Finance, Markets, Foreign Direct Investment
  • Political Geography: United States, China, Canada, Australia, Singapore
  • Publication Date: 08-2012
  • Content Type: Policy Brief
  • Institution: Oxford Economics
  • Abstract: GDP is expected to rise by 7.9% in 2012 and expand by 8.7% in 2013. Over the next 10 years to 2021, GDP is predicted to grow on average by 7.8% a year. Manufacturing output growth is forecast to be higher than GDP growth over the next decade. Manufacturing output is expected to increase by 8.8% in 2012 and expand by 9.4% in 2013. Over the next 10 years to 2021, manufacturing output is expected to grow on average by 7.9% a year. As a result, the share of manufacturing output in GDP is projected to rise from 34.0% in 2011 to 35.1% by 2016 and increase to 35.6% by 2021. Over the same period, the share of service sector output in GDP is expected to expand from 41.7% in 2011 to 43.8% in 2016 and rise to 45.5% in 2021.
  • Topic: Economics, Industrial Policy, International Trade and Finance, Markets, Foreign Direct Investment
  • Political Geography: China, Israel
  • Publication Date: 10-2012
  • Content Type: Policy Brief
  • Institution: Oxford Economics
  • Abstract: The Chinese economy expanded by 7.4% year-on-year in Q3, down from 7.6% in Q2, but stronger than we had expected. Of particular surprise was the implied quarterly growth rate; based on the seasonally adjusted data released by the NBS, the economy expanded at an annualised rate of 9.1%, the strongest since 2011Q3.
  • Topic: Economics, Industrial Policy, International Trade and Finance, Markets
  • Political Geography: China, Syria
  • Author: Jyrki Kallio
  • Publication Date: 02-2011
  • Content Type: Working Paper
  • Institution: Finnish Institute of International Affairs
  • Abstract: This study discusses the role of history and tradition in the legitimization of the state in the People's Republic of China. In Chinese political debate, history has traditionally been the most important source of argumentation. Today, the Party-state is reinventing history and tradition to bolster its legitimacy, but the project has met with opposition. This study introduces and analyzes the related debate, ongoing among various actors in different public fora in China, and engaged in both by those affiliated with the Party-state and those outside the establishment.
  • Topic: Economics, Government, Markets, Political Economy, Politics
  • Political Geography: China
  • Author: Michael Cohen
  • Publication Date: 03-2011
  • Content Type: Working Paper
  • Institution: United Nations University
  • Abstract: International narratives on Argentina's recovery from the crisis of 2001-02 tend to emphasize the role of rising commodity prices and growing demand from China. Argentina is said to have been 'lucky', saved by global demand for its agricultural exports. The international narrative has also been used by local agricultural exporters to justify their objections against higher export taxes during periods of high commodity prices. These narratives are not correct. Data on the country's recovery show that it was not led by agricultural exports but was fuelled by urban demand and production. When the Convertibility period ended and the peso was devalued in 2002, price increases for imports stimulated the production of domestic goods and services for consumers. This production in turn generated multiplier effects which supported small and medium-sized firms and helped to create many new jobs. This later produced a revival of the construction and then the manufacturing sectors as well.
  • Topic: Agriculture, Economics, International Trade and Finance, Markets, Financial Crisis
  • Political Geography: China, Argentina, Latin America
  • Author: Jyrki Ali-Yrkkö, Petri Rouvinen, Timo Seppälä, Pekka Ylä-Anttila
  • Publication Date: 02-2011
  • Content Type: Working Paper
  • Institution: Berkeley Roundtable on the International Economy
  • Abstract: Available statistics tell us little about the economic consequences of increasing global dispersion of production processes. In order to shed light on the issue, we perform grass roots detective work to uncover the geography of value added in the case of a Nokia N95 smartphone circa 2007. The phone was assembled in Finland and China. In the case when the device was assembled and sold in Europe, the value-added share of Europe (EU-27) rose to 68%. Even in the case when it was assembled in China and sold in the United States, Europe captured as much as 51% of the value added, despite of the fact that it had rather little role in supplying the physical components. Our analysis illustrates that international trade statistics can be misleading; the capture of value added is largely detached from the physical goods flows. It is rather services and other intangible aspects of the supply chain that dominate. While final assembly – commanding 2% of the value added in our case – has increasingly moved offshore, the developed countries continue to capture most of the value added generated by global supply chains.
  • Topic: Economics, Globalization, Industrial Policy, International Trade and Finance, Markets
  • Political Geography: China, Europe, Finland
  • Author: Yair Aharoni
  • Publication Date: 01-2011
  • Content Type: Working Paper
  • Institution: Columbia Center on Sustainable Investment
  • Abstract: In the first four decades of its existence, Israel was not successful in attracting inward foreign direct investment (IFDI) despite attempts to do so. In the past two decades, Israel have become a haven for multinational enterprises (MNEs) that have taken advantage of its unique assets – among them a skilled, educated workforce and cutting-edge research-and-development (R) capabilities – by establishing production lines or R centers and acquiring dozens of successful start ups. Israel's IFDI stock sharply increased from US$ 4.5 billion in 1990 to US$ 71.3 billion in 2009. It is expected that IFDI will further accelerate following Israel's accession to the OECD in May 2010 and as more firms from emerging market economies, including China and India, will come to appreciate its characteristics as an ideal locational choice. Israel also weathered the global economic crisis well, even though IFDI declined sharply. Israel actively encourages IFDI, mainly in high technology areas. In 2010, the Government also created special incentives to attract research centers of financial institutions.
  • Topic: Economics, Markets, Foreign Direct Investment, Financial Crisis
  • Political Geography: China, Middle East, India, Israel
  • Author: Randal O'Toole
  • Publication Date: 06-2011
  • Content Type: Working Paper
  • Institution: The Cato Institute
  • Abstract: The debate over President Obama's fantastically expensive high-speed rail program has obscured the resurgence of a directly competing mode of transportation: intercity buses. Entrepreneurial immigrants from China and recently privatized British transportation companies have developed a new model for intercity bus operations that provides travelers with faster service at dramatically reduced fares.
  • Topic: Economics, Markets, Infrastructure, Governance
  • Political Geography: United States, China
  • Publication Date: 09-2011
  • Content Type: Working Paper
  • Institution: Economist Intelligence Unit
  • Abstract: Foreign companies continue to be attracted by the opportunities offered by China's large and rapidly growing economy. China has a population of over 1.3bn, and the size of the economy is likely to grow to just under US$13trn a year at market exchange rates by 2015. Although GDP per head will still be relatively low by the end of the forecast period, at just under US$10,000 a year, this will represent a substantial improvement from just under US$4,500 in 2010. Significant regional disparities within China will persist. The provinces of the eastern seaboard enjoy standards of living well above the national average. However, there are also markets to be found in inland China, where many large cities are located. To some extent, the size of the population and the pace of economic growth belie the challenges of operating in China. Nationwide distribution networks will increasingly be put in place, but the Chinese market is likely still to be a fragmented one by 2015.
  • Topic: Demographics, International Trade and Finance, Markets, Foreign Direct Investment
  • Political Geography: China
  • Author: Arvind Subramanian
  • Publication Date: 09-2011
  • Content Type: Working Paper
  • Institution: Peterson Institute for International Economics
  • Abstract: Against the backdrop of the recent financial crisis and the ongoing rapid changes in the world economy, the fate of the dollar as the premier international reserve currency is under scrutiny. This paper attempts to answer whether the Chinese renminbi will eclipse the dollar, what will be the timing of, and the prerequisites for this transition, and which of the two countries controls the outcome. The key finding, based on analyzing the last 110 years, is that the size of an economy—measured not just in terms of GDP but also trade and the strength of the external financial position—is the key fundamental correlate of reserve currency status. Further, the conventional view that sterling persisted well beyond the strength of the UK economy is overstated. Although the United States overtook the United Kingdom in terms of GDP in the 1870s, it became dominant in a broader sense encompassing trade and finance only at the end of World War I. And since the dollar overtook sterling in the mid-1920s, the lag between currency dominance and economic dominance was about 10 years rather than the 60-plus years traditionally believed. Applying these findings to the current context suggests that the renminbi could become the premier reserve currency by the end of this decade, or early next decade. But China needs to fulfill a number of conditions—making the reniminbi convertible and opening up its financial system to create deep and liquid markets—to realize renminbi preeminence. China seems to be moving steadily in that direction, and renminbi convertibility will proceed apace not least because it offers China's policymakers a political exit out of its mercantilist growth strategy. The United States cannot in any serious way prevent China from moving in that direction.
  • Topic: Economics, Markets, Monetary Policy
  • Political Geography: United States, China
  • Author: Laurence Marfaing, Alena Thiel
  • Publication Date: 11-2011
  • Content Type: Working Paper
  • Institution: German Institute of Global and Area Studies
  • Abstract: Since the beginning of the twenty‐first century, Africa has seen the arrival of a new form of Chinese migration. Largely independent from big Chinese players, these “new entrepreneurial migrants” come to Africa not as workers in the highly prestigious state projects, but rather to follow their own economic interests. Engaging in business activities as diverse as petty manufacturing, printing, pharmaceutical and medical services, restaurants, beauty salons and last but not least, general trade, these independent Chinese migrants are often acknowledged for bringing affordable new commercial services and goods to low‐income households on the African continent. On the other hand, the high visibility of the Chinese entrepreneurial activities has also sparked anti‐Chinese sentiments among many African entrepreneurs.
  • Topic: Economics, Imperialism, International Trade and Finance, Markets
  • Political Geography: Africa, China, Ghana
  • Author: David Wheeler, Robin Kraft, Dan Hammer
  • Publication Date: 12-2011
  • Content Type: Working Paper
  • Institution: Center for Global Development
  • Abstract: In this paper, we develop and illustrate a prototype incentive system for promoting rapid reduction of forest clearing in tropical countries. Our proposed Tropical Forest Protection Fund (TFPF) is a cash-on-delivery system that rewards independently monitored performance without formal contracts. The system responds to forest tenure problems in many countries by dividing incentive payments between national governments, which command the greatest number of instruments that affect forest clearing, and indigenous communities, which often have tenure rights in forested lands. The TFPF incorporates both monetary and reputational incentives, which are calculated quarterly. The monetary incentives are unconditional cash transfers based on measured performance, while the reputational incentives are publicly disclosed, color-coded performance ratings for each country. The incentives include rewards for: (1) exceeding long-run expectations, given a country's forest clearing history and development status; (2) meeting or exceeding global REDD+ goals; and (3) achieving an immediate reduction in forest clearing. Drawing on monthly forest clearing indicators from the new FORMA (Forest Monitoring for Action) database, we illustrate a prototype TFPF for eight East Asian countries: Cambodia, China, Indonesia, Lao PDR, Malaysia, Myanmar, Thailand, and Vietnam. A system with identical design principles could be implemented by single or multiple donors for individual or multiple forest proprietors within one or more countries, as well as national or local governments in individual countries, tropical regions, or the global pan-tropics. Our results demonstrate the importance of financial flexibility in the design of the proposed TFPF. Its incentives are calculated to induce a massive, rapid reduction of tropical forest clearing. If that occurs, a TFPF for East Asia will need standby authority for disbursements that may total $10–14 billion annually for the next two decades. This financial burden will not persist, however, because the TFPF is designed to self-liquidate once all recipient countries have achieved clearly specified benchmarks. We estimate that the TFPF can be closed by 2070, with its major financial responsibility discharged by 2040.
  • Topic: Agriculture, Economics, Globalization, Markets
  • Political Geography: China, Indonesia, Malaysia, East Asia, Vietnam, Cambodia, Thailand, Southeast Asia, Myanmar
  • Author: Arvind Subramanian, Aaditya Mattoo
  • Publication Date: 12-2011
  • Content Type: Working Paper
  • Institution: Peterson Institute for International Economics
  • Abstract: Until recently, the World Trade Organization (WTO) has been an effective framework for cooperation because it has continually adapted to changing economic realities. The current Doha Agenda is an aberration because it does not reflect one of the biggest shifts in the international economic and trading system: the rise of China. Even though China will have a stake in maintaining trade openness, an initiative that builds on but redefines the Doha Agenda would anchor China more fully in the multilateral trading system. Such an initiative would have two pillars. First, a new negotiating agenda that would include the major issues of interest to China and its trading partners, and thus unleash the powerful reciprocal liberalization mechanism that has driven the WTO process to previous successes. Second, new restraints on bilateralism and regionalism that would help preserve incentives for maintaining the current broad non-discriminatory trading order.
  • Topic: Economics, Globalization, International Trade and Finance, Markets
  • Political Geography: China, Israel
  • Author: Bill White
  • Publication Date: 10-2011
  • Content Type: Working Paper
  • Institution: Aspen Institute
  • Abstract: A shift in relative energy consumption among regions and the development of new, unconventional supplies will be the most significant changes over the next twenty years. The dominant fuels in the world energy market until 2030 will continue to be hydrocarbons — oil, coal, and natural gas. Major shifts will occur, however, among the three fuels, among regions and in their supply. Globally, oil will continue to be the most widely used fuel as it supplies more than 90 percent of the energy for transportation. Coal, now the dominant fuel used for electric power generation, will lose ground to natural gas, a less carbon-intensive hydrocarbon. Natural gas will become the second largest overall supplier and well positioned to replace coal as the leading supplier for electric power. Developing countries will lead the way in overall energy growth, with Chinese and Indian energy demand growing fastest. Energy demand in developed countries will remain flat. For the United States, growth in gas shale and oil shale are likely to be “game changers,” altering the supply picture dramatically.
  • Topic: Climate Change, Energy Policy, Environment, Markets, Political Economy, Natural Resources
  • Political Geography: United States, China, India
  • Author: John H. Makin
  • Publication Date: 03-2011
  • Content Type: Policy Brief
  • Institution: American Enterprise Institute for Public Policy Research
  • Abstract: The array of postbubble stresses and uncertainties identified in the January 2010 Economic Outlook (“The Year Ahead”) promised that the new year would see plenty of volatility in markets. That is exactly what is playing out as we move through the first quarter. As risks accumulate, it may be that 2010 is shaping up as a mirror image of 2009, reversing last year's down-then-up pattern with an up-then-down pattern this year.
  • Topic: Economics, International Trade and Finance, Markets, Monetary Policy, Financial Crisis
  • Political Geography: United States, Japan, China, Europe
  • Author: Martin Neil Baily
  • Publication Date: 01-2011
  • Content Type: Policy Brief
  • Institution: The Brookings Institution
  • Abstract: During an "exit interview" with the Wall Street Journal, departing National Economic Council Director Lawrence Summers argued that history would judge the United States based on how well we adjust to China's emergence as a great power, economically and politically. In the face of China's progress, America's manufacturing sector faces major challenges in becoming and remaining competitive and our choice of national economic policies will affect how well we meet those challenges. It is essential that the U.S. trade deficit not balloon as the economy recovers. There is scope to expand our exports in services and agriculture, but improving the competitiveness of U.S. manufacturing is vital.
  • Topic: International Trade and Finance, Markets, Bilateral Relations
  • Political Geography: United States, China, America
  • Author: Leonard S. Rubenstein
  • Publication Date: 01-2011
  • Content Type: Policy Brief
  • Institution: United States Institute of Peace
  • Abstract: During the 1990s, economic mismanagement, political oppression, natural disaster, and loss of external subsidies after the end of communism led to a calamitous decrease in food production in the Democratic People's Republic of Korea (DPRK). The public health infrastructure, including water and sanitation systems, drug distribution and supply chains, and local clinics and hospitals, also deteriorated. At least half a million people died of starvation and millions more suffered acute or chronic malnutrition. Malnutrition increased vulnerability to disease at a time when the health system was incapable of effective response. Fifeen years later, neither health nor the food systems have recovered as the economy persistently stagnates. Health continues to be a low priority for the government. The availability of food is insufficient to meet population needs, hospitals and clinics are significantly ill-equipped, the medical workforce lacks appropriate training, and corruption in drug distribution is pervasive. Malnutrition and anemia, as well as diseases associated with poor sanitation, remain widespread. Over the last few years, DPRK has begun to accept international assistance to address health system needs, most notably to vaccinate children. Although these initiatives address some infrastructure needs, the continued centralized control of health and the lack of open discussion about key issues renders the possibility of reforms sufficient to meet the health needs of the people of North Korea dim. During the economic crisis, tens of thousands of North Koreans migrated to China despite harsh measures imposed by both governments to restrict border crossing and a refusal by China to give legal status to the migrants. To a limited extent, migration ameliorated the health impact of the crisis by stimulating illicit cross-border trade and informal markets that increased some North Koreans' access to food. Even after a disastrous effort by the DPRK government to shut the markets down in 2009, they are re-emerging. China's encouragement of these markets, along with regularizing the status of migrants in China, could advance its own economic interests as well as contributing to improving the health of North Koreans.
  • Topic: Communism, Economics, Health, Markets, Financial Crisis
  • Political Geography: China, Israel, North Korea
  • Author: Arvind Subramanian, Aaditya Mattoo, Francis Ng
  • Publication Date: 05-2011
  • Content Type: Policy Brief
  • Institution: Peterson Institute for International Economics
  • Abstract: The puzzle about the Doha Round of multilateral trade negotiations in the World Trade Organization (WTO) is not why it is on life support now but how it has survived as a viable multilateral initiative for so long. From the very beginning, it was clear that the Round suffered from a lack of private-sector interest, the engine that had driven previous rounds of successful trade negotiations. At most, Doha promised to deliver some security of access for unilateral liberalization previously undertaken by countries and some modest incremental market opening (Martin and Mattoo 2009; Hufbauer, Schott, and Wong 2010). That the Round had much to be modest about was reflected in the failure of even antiglobalization protesters to show up for the more recent meetings of the Doha Round.
  • Topic: Economics, Globalization, International Trade and Finance, Markets
  • Political Geography: China
  • Author: Nilgün Gökgür
  • Publication Date: 04-2011
  • Content Type: Policy Brief
  • Institution: Columbia Center on Sustainable Investment
  • Abstract: There are no up-to-date systematic data on the size, composition, ownership structure, and economic weight of state-owned enterprises (SOEs), so we are unable to assess the impact of SOE performance on stakeholders in domestic and overseas markets. Yet there is sufficient evidence of their expansion, especially following the 2008 financial crisis. Emerging markets, led by China, are now increasingly encouraging their SOEs to expand globally as multinational enterprises (MNEs).
  • Topic: Economics, Emerging Markets, Globalization, Markets
  • Political Geography: Africa, China
  • Author: James W. Ceaser
  • Publication Date: 01-2010
  • Content Type: Working Paper
  • Institution: American Enterprise Institute for Public Policy Research
  • Abstract: What in the writings of Alexis de Tocqueville could conceivably be thought to offer any guidance for the study of contemporary China? Tocqueville was born early in the nineteenth century (1805) at a time when China lay in near total isolation from Europe. Matters changed during Tocqueville's lifetime with the so-called Opium War (1839–41), in which China suffered a humiliating defeat at the hands of Great Britain. This reversal helped set in motion a series of events that led to the destabilization of the Manchu (or Qing) dynasty, which eventually fell in 1911. Tocqueville commented in his personal notes on a few of the early occurrences in this sequence, but he never undertook an extensive analysis of developments in the Far East. His focus in his published works was on the West, or what he often called “the Christian world.”
  • Topic: Foreign Policy, Markets, Religion
  • Political Geography: Britain, United States, China, Europe
  • Author: Dirk Kohnert
  • Publication Date: 07-2010
  • Content Type: Working Paper
  • Institution: German Institute of Global and Area Studies
  • Abstract: The remarkable influx of Chinese migrant entrepreneurs in West Africa has been met with growing resistance from established African entrepreneurs. Whether the former have a competitive edge over the latter because of distinctive sociocultural traits or whether the Chineseʹ s supposed effectiveness is just a characteristic feature of any trading diaspora is open to question. This comparative exploratory study of Chinese and Nigerian entrepreneurial migrants in Ghana and Benin provides initial answers to these questions. Apparently, the cultural stimuli for migrant drivers of change are not restricted to inherited value systems or religions, such as a Protestant ethic or Confucianism; rather, they are continually adapted and invented anew by transnational migration networks in a globalized world. There is no evidence of the supposed superiority of the innovative culture of Chinese entrepreneurial migrants versus that of African entrepreneurial migrants. Rather, there exist trading diasporas which have a generally enhanced innovative capacity vis‐à‐vis local entrepreneurs, regardless of the national culture in which they are embedded. In addition, the rivalry of Chinese and Nigerian migrant entrepreneurs in African markets does not necessarily lead to the often suspected cut‐throat competition. Often the actions of each group are complementary to those of the other. Under certain conditions they even contribute to poverty alleviation in the host country.
  • Topic: Economics, Markets, Migration
  • Political Geography: Africa, China
  • Author: John Whalley, Manmohan Agarwal, Yao Li
  • Publication Date: 04-2010
  • Content Type: Working Paper
  • Institution: Centre for International Governance Innovation
  • Abstract: Productivity growth is a significant contributor to GDP growth, particularly to increases in per capita income. However, there is considerable ambiguity regarding how to measure the concept of technical progress, and consequently on policies that would foster productivity growth. Brazil, China and India, three important emerging economies, are seeking to foster productivity growth through encouraging innovation and technology transfers from the more developed economies. But given the ambiguities about how to encourage innovation and technology transfers, governments in these countries adopted a plethora of policies in the hope that the combination will be effective. This ambiguity can also be seen in the much slower growth of productivity in Brazil than China, even though Brazil has scored higher on the World Bank's Knowledge Assessment Methodology.
  • Topic: Development, Emerging Markets, Markets, Science and Technology, Foreign Direct Investment
  • Political Geography: China, India, Brazil
  • Author: Nathaniel Ahrens
  • Publication Date: 07-2010
  • Content Type: Working Paper
  • Institution: Carnegie Endowment for International Peace
  • Abstract: Indigenous innovation has become the greatest immediate source of economic friction between the United States and China. This trend is not unique to these two countries; policy makers globally are actively trying to stimulate domestic innovation. The burgeoning markets for biotech and environment-related products and services and, potentially even more important, countries' efforts to emerge from the global economic slowdown all reinforce this trend. Mindful of this global scene, China has made indigenous innovation one of the core elements of its attempt to make a structural shift up the industrial value chain.
  • Topic: International Trade and Finance, Markets, Bilateral Relations
  • Political Geography: United States, China
  • Author: Gary Clyde Hufbauer, Jared C. Woollacott
  • Publication Date: 12-2010
  • Content Type: Working Paper
  • Institution: Peterson Institute for International Economics
  • Abstract: This study covers the history of Sino-US trade relations with a particular focus on the past decade, during which time each has been a member of the World Trade Organization (WTO). Providing a brief history of 19th and 20th century economic relations, this paper examines in detail the trade disputes that have arisen between China and the United States over the past decade, giving dollar estimates for the trade flows at issue. Each country has partaken in their share of protectionist measures, however, US measures have been characteristically defensive, protecting declining industries, while Chinese measures have been characteristically offensive, promoting nascent industries. We also cover administrative and legislation actions within each country that have yet to be the subject of formal complaint at the WTO. This includes an original and comprehensive quantitative summary of US Section 337 intellectual property rights cases. While we view the frictions in Sino-US trade a logical consequence of the rapid increase in flows between the two countries, we caution that each country work within the WTO framework and respect any adverse decisions it delivers so that a protracted protectionist conflict does not emerge. We see the current currency battle as one potential catalyst for such conflict if US and Chinese policymakers fail to manage it judiciously.
  • Topic: Economics, International Trade and Finance, Markets, Bilateral Relations
  • Political Geography: United States, China
  • Author: Meghan Bruce
  • Publication Date: 10-2010
  • Content Type: Working Paper
  • Institution: Asia-Pacific Research Center
  • Abstract: Since 1978, China has been primarily market-focused in its provision of health care and social services. The market-driven health care system has been characterized by perverse incentives for individual providers, patients, and hospitals that are inducing improper provision of care: overprescription of pharmaceuticals and hightech testing, lack of effective primary care and gatekeeping, and competition for patients instead of referral. The national health care reform document that was made public in April 2009 recognizes this failure of the market in health care in China. The document suggests potential policies for improvement on the current system that are focused primarily on a targeted increase in government funding and an increased, changing role for the government. We assess the potential of this national health care reform to achieve the stated goals, and conclude that the reform as designed is necessary but insufficient. For the reform to meet its goals, the promised increase in funding should be accompanied by improved data collection, regional piloting, and a strong regulatory and purchasing role for the government in aligning incentives for individual and institutional payers, providers, and patients.
  • Topic: Health, Markets
  • Political Geography: China, Israel
  • Author: Qunhong Shen, Liyang Tang
  • Publication Date: 09-2010
  • Content Type: Working Paper
  • Institution: Asia-Pacific Research Center
  • Abstract: Many Chinese express dissatisfaction with their healthcare system with the popular phrase Kan bing nan, kan bing gui ("medical treatment is difficult to access and expensive"). Critics have cited inefficiencies in delivery and poor quality of services. Determining the pattern of patient satisfaction with health services in China-and the causes of patient dissatisfaction-may help to improve health care not only in China but in countries in similar predicaments throughout the world.
  • Topic: Economics, Markets, Social Stratification, Health Care Policy
  • Political Geography: China
  • Author: Luke Eric Peterson
  • Publication Date: 01-2010
  • Content Type: Policy Brief
  • Institution: Columbia Center on Sustainable Investment
  • Abstract: The recent high-stakes dispute between Google and China over censorship and cyber-security has spawned renewed discussion of the international trade law protections that internet and media companies may enjoy. Less recognized, however, is a perhaps more powerful legal tool in the arsenal of internet and media companies engaging in cross-border investment s, namely international investment law.
  • Topic: Economics, International Trade and Finance, Markets, Mass Media, Law
  • Political Geography: China
  • Author: John H. Makin
  • Publication Date: 01-2010
  • Content Type: Policy Brief
  • Institution: American Enterprise Institute for Public Policy Research
  • Abstract: We can expect 2010 to be a volatile year. This likelihood is underscored by looking back at 2008 and 2009. Two thousand eight was a highly volatile year leading up to the collapse of Lehman Brothers in September, which was followed by the risk of a total systemic meltdown. That sharp and obvious risk spike prompted massive policy responses that were simply the largest that central banks, with rate cuts and liquidity provision, and governments, with tax cuts and spending increases, could manage. The result—beginning in March 2009—was a linear rise in the prices of risky assets, the result of massive relief once the slip into a global depression had been averted and the acute phase of the crisis in the financial sector had passed.
  • Topic: Economics, International Trade and Finance, Markets, Financial Crisis
  • Political Geography: United States, Japan, China, Europe
  • Author: Katri Pynnöniemi
  • Publication Date: 11-2010
  • Content Type: Policy Brief
  • Institution: Finnish Institute of International Affairs
  • Abstract: Rumour has it that prior to his first visit to Beijing in spring 2008, President Medvedev instructed officials at the Ministry of Trade and Development to take a picture of Moscow that would aptly convey Russia's drive for modernization and innovation to his Chinese hosts. In carrying out his orders, employees from the ministry spent two months looking for a suitable place to photograph, but it is not known whether they were successful in their quest or not. Perhaps the story is only apocryphal, and no such order was ever given. Nevertheless, the anecdote has sown the seeds of doubt in the minds of the country's current leadership that there is actually not that much to see when it comes to the campaign for the 'technological modernization' of Russia.
  • Topic: Development, Emerging Markets, Markets, Political Economy, Science and Technology
  • Political Geography: Russia, China, Moscow
  • Author: Tai Ming Cheung
  • Publication Date: 09-2010
  • Content Type: Policy Brief
  • Institution: Institute on Global Conflict and Cooperation, University of California
  • Abstract: Since the beginning of the twenty-first century, China's defense science, technology, and innovation (DSTI) system has been vigorously developing a comprehensive set of innovation capabilities that will eventually allow it to join the world's top tier of military technological powers. Ample access to financial, human, and research resources; strong political support; inflows of foreign technologies and know-how; and the introduction of advanced modes of governance, market competition, and management are producing significant progress, although from a low base. But long-term success is far from assured as daunting structural bottlenecks stand in the way, not the least of which is the struggle to overcome a long history of debilitating Socialist central planning.
  • Topic: Defense Policy, Economics, Markets, Science and Technology, Governance
  • Political Geography: China, Asia
  • Author: Chen Taifeng
  • Publication Date: 07-2009
  • Content Type: Working Paper
  • Institution: Norwegian Institute of International Affairs
  • Abstract: The simultaneous emergence of rapidly developing RTAs and a strengthened and more encompassing MTS attracts worldwide attention. “Complementary Competition” is the very essence of the RTA/MTS relationship. Both compete complementarily in trade liberalization and economic integration initiatives. Since joining the WTO, China has pursued a “three-pronged” economic and trade development strategy of pushing forward regional trade cooperation and bilateral trade cooperation while enhancing multilateral trade and cooperation. After joining the WTO, China has basically developed a spatial landscape of “focusing on Asia-Pacific and reaching out globally” with regard to its participation in the RTA.By participating in RTAs, China can obtain the same benefits of market openness and trade and investment liberalization as other countries do. It is important for China not to act too hastily, but to push forward regional cooperation step by step from adjacent to remote regions and level by level, from easy to difficult regions. Asia is especially important to China, and Asian economic cooperation is the foundation of China's RTA policy.
  • Topic: Economics, International Trade and Finance, Markets
  • Political Geography: China, Asia
  • Author: Jaya Prakash Pradhan
  • Publication Date: 08-2009
  • Content Type: Working Paper
  • Institution: Columbia Center on Sustainable Investment
  • Abstract: Just over a year ago, outward foreign direct investment (OFDI) from India seemed to be on a path of rapid and sustained growth. Its annual average growth of 98% during 2004–07 had been unprecedented , much ahead of OFDI growth from other emerging markets like China (74%), Malaysia (70%), Russia (53%), and the Republic of Korea (51%), although from a much lower base. Much of this recent growth had been fuelled by large-scale overseas acquisitions, however, and it faltered when the global financial crisis that started in late 2007 made financing acquisitions harder.
  • Topic: Economics, International Political Economy, International Trade and Finance, Markets, Foreign Direct Investment, Financial Crisis
  • Political Geography: Russia, China, South Asia, Malaysia, Korea
  • Author: James J. Przystup
  • Publication Date: 04-2009
  • Content Type: Working Paper
  • Institution: Institute for National Strategic Studies
  • Abstract: From its earliest days, the United States has been engaged in trade with East Asia. In February 1784, the Empress of China left New York harbor, sailing east to China, arriving at Macau on the China coast in August of that year. The ship returned to the United States the following May with a consignment of Chinese goods, which generated a profit of $30,000. In 1844, China granted the United States trading rights in the Treaty of Wanghia.
  • Topic: Economics, International Trade and Finance, Markets, Financial Crisis
  • Political Geography: United States, China, Asia, Australia/Pacific
  • Author: James Cockayne, Emily Speers Mears, Alison Gurin, Iveta Cherneva, Sheila Oviedo, Dylan Yaeger
  • Publication Date: 07-2009
  • Content Type: Working Paper
  • Institution: International Peace Institute
  • Abstract: In late 2008, seventeen states, including the US, UK, China, Iraq, Afghanistan, and others, endorsed the Montreux Document on Pertinent International Legal Obligations and Good Practices for States related to Operations of Private Military and Security Companies during Armed Conflict (2008). This provides important guidance to states in regulating private military and security companies (PMSCs). However, there is a need to do more, to provide increased guidance to the industry and ensure standards are enforced.
  • Topic: Security, Globalization, Markets, International Security, Financial Crisis
  • Political Geography: Afghanistan, United States, China, Iraq, United Kingdom
  • Author: James Cockayne (ed.)
  • Publication Date: 07-2009
  • Content Type: Book
  • Institution: International Peace Institute
  • Abstract: In late 2008, seventeen states, including the US, UK, China, Iraq, Afghanistan, and others, endorsed the Montreux Document on Pertinent International Legal Obligations and Good Practices for States related to Operations of Private Military and Security Companies during Armed Conflict (2008). This provides important guidance to states in regulating private military and security companies (PMSCs). However, there is a need to do more, to provide increased guidance to the industry and ensure standards are enforced.
  • Topic: Conflict Prevention, Security, Markets
  • Political Geography: Afghanistan, United States, China, Iraq
  • Author: Kerry Brown
  • Publication Date: 03-2009
  • Content Type: Policy Brief
  • Institution: Chatham House
  • Abstract: Over the last two decades, as Mainland China has been developing and liberalizing its economy, Taiwan has been undergoing an equally remarkable but very different political transformation, from martial law in 1987 to its current status as one of the most vibrant, stable democracies in Asia. Despite its eventful experience of the democratization process, the parliamentary and presidential elections in 2008 proved that Taiwan is now a mature, and stable, democracy. It has passed the ultimate test, seeing the successful transition of rule from one party to another and back again, without social turmoil. Economic performance over the same period has been less striking. Once among the fastestgrowing economies, Taiwan is now afflicted by a relatively low growth rate, and problems over the outflow of capital and investment to the Mainland. The potential for conflict over cross-straits relations remains but it has been significantly reduced under President Ma and by the Mainland Chinese government's greater accommodation with a democratic Taiwan in the last decade. The risk of a military conflict between the two sides, which could drag in the US, and therefore the rest of the world, cannot be entirely discounted, however. Taiwan's greatest challenges in the next decade remain the same as in the last – to maintain its identity, to develop its democratic system, and to handle relations with the Mainland in a way that preserves its interests while avoiding conflict. Taiwan's system, which has so far proved itself robust and effective, faces a new challenge too: how to benefit from the increase in Mainland investment abroad.
  • Topic: Democratization, Economics, Markets
  • Political Geography: United States, China, Israel, Taiwan, Asia
  • Author: Sandeep Kapur, Suma Athreye
  • Publication Date: 01-2009
  • Content Type: Policy Brief
  • Institution: United Nations University
  • Abstract: The last two decades have seen a significant rise in the internationalization of firms from developing economies. In addition to their growing participation in international trade, a number of leading emerging economies are contributing to growing outflows of foreign direct investment (FDI) and cross-border mergers and acquisitions. According to the 2008 World Investment Report, outward flows of FDI from developing countries rose from about US$6 billion between 1989 and 1991 to US$225 billion in 2007. As a percentage of total global outflows, the share of developing countries grew from 2.7% to nearly 13.0% during this period.
  • Topic: International Relations, Economics, Globalization, International Political Economy, Markets, Foreign Direct Investment, Financial Crisis
  • Political Geography: United States, China, India
  • Author: Robert Gutierrez, Patricia Chow, Jason Baumgartner, Yuriko Sato
  • Publication Date: 05-2009
  • Content Type: Policy Brief
  • Institution: Institute of International Education
  • Abstract: IIE Open Doors Data on U.S. International Educational Exchange. Project Atlas: Global Student Mobility. International Student Economic Impact in the U.S. Comparison of International Student Economic Impact in USA, Japan and Australia.
  • Topic: Foreign Policy, Economics, Markets, Migration
  • Political Geography: United States, Japan, China, Asia, California, Australia, Texas
  • Author: John H. Makin
  • Publication Date: 09-2009
  • Content Type: Policy Brief
  • Institution: American Enterprise Institute for Public Policy Research
  • Abstract: More than two years have passed since the U.S. housing bubble burst. That event ushered in a financial crisis that was not only intense but also stunning. So stunning in fact, that in August of last year, just a month before the collapse of Lehman Brothers, the global economy was close to a crisis worthy of comparison with the Great Depression, yet neither the markets nor the Federal Reserve had much of an inkling of what was to come. The Standard and Poor's (S) 500 Index had come down to about 1,300 from its October 2007 high of 1,576. Positive growth had just been reported for the U.S. economy during the second quarter of 2008 at an annual rate of 2.8 percent (later revised down to 1.5 percent). Almost one percentage point of that growth came from U.S. consumption, and government spending also contributed. The wave of relief after the Bear Stearns scare in March 2008 had provided a nice boost to the economy and to markets. That boost was further enhanced by the substantial contribution to growth from net exports (2.9 percentage points) thanks to what was, then, continuing strength in the global economy, especially in China, which had reported blistering 10.1 percent year-over-year growth in the second quarter of 2008. These and other positive components more than offset a drag from inventories and residential investment. In short, the real economy had not shown much evidence of damage emanating from the chaos that was churning in the financial sector.
  • Topic: Economics, International Political Economy, International Trade and Finance, Markets, Monetary Policy, Financial Crisis
  • Political Geography: United States, China