Edge of Change (Issue 019)

| | 15-08-2018, 09:10

Global Supply Chains Are Dangerously Easy to Snap (by Elisabeth Braw)

7 August 2018

UK’s stockpiling plans in case a no-deal Brexit and the reasons why other developed countries depending on complex supply chains should take Britain’s misfortune as a wake-up call are being discussed in this article. Global supply chains in a modern world are a national security issue. Although thanks to a highly concentrated production and distribution system consumers can enjoy steady supplies of cheap goods from any part of the world, the system’s complexity makes it very fragile. Disruptions to global supply chains can be even more devastating than a military attack. Thus, developed countries should take certain actions considering this challenge. 


Why Nord Stream 2 is the world’s most controversial energy project

7 August 2018

The article discusses the controversies around the Nord Stream 2 and explains why it represents such a huge geopolitical concern. Ukraine used to serve as a transit corridor for the Russian gas exported to Europe, but now thanks to Nord Stream 2 (NS2) pipeline, Russia will be able to divert the rest of its European gas supplies directly to Germany, which will damage Ukrainian economy. In this case, Ukraine will be isolated and left at the mercy of its Russian foe. If the project goes ahead, Europe will become more dependent on Russian gas, and Mr. Putin will be left with even less incentives to make concessions to Ukraine. 


China Is Cheating at a Rigged Game (By Jake Werner) 

8 August 2018

A broad consensus across the political spectrum is currently emerging in the U.S. as regards the presumably negative role of China. People as different as left-wing Senators Bernie Sanders and Elizabeth Warren, on one side, and former White House Chief Strategist Steve Bannon on the other champion a tough line towards Beijing, decrying the transfer of American technology to China and supporting increase in protectionist measures. Free-trade stalwarts like the Wall Street Journal editorial board and establishment bodies like the Council on Foreign Relations are finding common ground with protectionist unions like the United Steel workers and trade critics like Global Trade Watch. Seemingly everyone agrees that the Chinese are conducting trade in a predatory manner that hurts American business and workers, and that the time for confrontation has arrived. The article, however, argue that it is unfair to blame China in the wrongs of the global economy; it is rather the deadlock of the current form of globalization that is to blame. So, vilifying China has become a substitute for facing honestly the urgent need to transform the nature of global growth.


Water Wars on the Nile (By Daniel Benaim, Michael Wahid Hanna) 

9 August 2018

In Ethiopia, Africa’s largest-ever dam and hydroelectric power plant are inching closer to completion. The Grand Ethiopian Renaissance Dam (GERD) on the Nile River has the potential to transform Ethiopia’s economy and revolutionize the agricultural sector of its northwestern neighbor Sudan. But further downstream in Egypt many object to the dam, which they see as a fundamental threat to their way of life. So, the international dispute over the river has reached a make-or-break moment. In the coming year, Egypt and Ethiopia will either set their differences aside and forge a cooperative path forward together—an outcome that is technically feasible but politically fraught—or face a diplomatic downward spiral.

Today, both paths—escalating conflict and constructive cooperation—are distinctly possible, in the dam dispute as in the region as a whole. The risks of resurgent violence in eastern Africa, instability in Egypt, mass migration, and threats to key Red Sea chokepoints all suggest that the United States, Europe, and the international community have a stake in ensuring that actors on the ground and in the Middle East choose wisely. 


Globalization with Chinese Characteristics (by Barry Eichengreen)

10 August 2018

Barry Eichengreen claims that by initiating trade wars and indulging in self-centered policies, the U.S. risks to lose its global leadership very soon, and indeed it only triggers Beijing to be more assertive in its own aspirations for this status. So, he draws out major features of the global economy in case China becomes the key player. He emphasizes that while the Communist Party government favours free trade due to its commitment to export-led growth strategy, it is much more restrictive towards foreign direct investment inflow (in terms of their share, China is among the lowest-performing major countries), endorses capital control and is not particularly interested in intellectual property protection. However, the most important thing about China is that it prefers bilateral agreements and hub-and-spoke arrangements rather than the currently dominating format of global agreements under the WTO aegis. So, the role of the latter is set to decrease in the case of Chinese hegemony, while international integration will mostly move forwards with ad hoc projects of the kind of “One Belt, One Road”


Russia’s Comeback in the Balkans (By Arolda Elbasani, Katerina Tadic)

13 August 2018

Perpetual news of Russia’s efforts to disrupt political processes and sow distrust in Western democracies tends to overlook the scope or the goals of Russian meddling in its ‘traditional’ backyard- the Balkans. Here, evidence on Russian interference is rebuffed with long running conspiracy theories, conflicting ethno-religious politics and dysfunctional institutions that tend to blur what is real and what is smoke. Still, as the top US military commander in Europe notes, ‘Russia is at work in the Balkans.’ High level EU officials concur on Russia’s increasing ‘competitiveness’ in the region and predict major geopolitical repercussions. To quote the highest EU official in charge of foreign policy, ‘the Balkans can easily become one of the chessboards where the big power game can be played’. 


Trump Is the First President to Get Turkey Right (By Steven A. Cook)

13 August 2018

The Turkish leader raised valid concerns about U.S. policy that genuinely vex Turkish leaders and citizens alike. Yet, as Steven Cook claims, Erdogan only told half the story, leaving his readers to believe that Washington has victimized a reliable ally and partner. The United States has long had its own list of grievances, however—and it is to the Trump administration’s credit that, unlike its predecessors, it finally seems to be doing something about it. The sharp deterioration of relations between Washington and Ankara in the last week is only one of two crises enveloping Turkey at the moment: another one is the free fall of the Turkish lira as investors sell it off over concerns about economic mismanagement and uncertainty caused by the strain between the United States and Turkey. The authors conclude that any outsider plans on how to save the Turkish economy and the U.S.-Turkey relationship, are futile:currently, there is nothing for the United States to do.


The Simpson case. Why Putin and Trump won’t be able to agree (by Vladimir Pastukhov)

14 August 2018

In his opinion piece, Vladimir Pastukhov argues that the Trump-Putin relationship is kind of a bluff game and rollercoaster where the loser will be the one who gets exhausted first. He questions the widespread opinion about Moscow’s support for Trump and claims that he has been perceived only as a more suitable rival, who may stir up a chaos he wouldn’t be able to control, and also put himself in a vulnerable position domestically (which by far has proved right). The meeting in Helsinki then was more about PR and domestic posture than about any substantial outcomes. However, the author finds what unites the both leaders: their sheer distaste of Europe and an unconcealed desire to weaken it. Hence, he draws certain parallels with USSR and Nazi Germany in the wake of the World War II when the two revisionist powers attempted to reach an agreement at the expense of old European powers.