Recommended Weekend Reads
August 4 - 6, 2023
Here are our recommended reads from reports and articles we read in the last week. We hope you find these useful, and have a great, relaxing weekend. And let us know if you or someone you know wants to be added to our distribution list.
Global Political Economy
“Economists Reconsider Industrial Policy” Project Syndicate
Three noted international economists -Dani Rodrik, Réka Juhász, and Nathan Lane – take a fresh look at the performance of industrial policies. They note that in the past, economists often focus on indicators such as import tariffs, capturing only limited dimensions of such measures and conflating their objectives with others. A new generation of research efforts takes a more productive approach – and reaches very different conclusions.
“The Trade-Offs of Counterterrorism Policies” Economic Research, Federal Reserve Bank of St. Louis
Abstract: This article provides a modern overview of counterterrorism tools and their trade-offs for curbing terrorist attacks and their consequences. Defensive and proactive countermeasures constitute two main classes of counterterror tools deployed by targeted governments. The primary drawback of defensive actions, which make terrorist attacks more costly and less apt to succeed, is attack transference that shifts the mode, venue, or target of attacks to those less protected. In contrast, offensive, proactive measures, which confront the terrorists directly, may result in backlash as terrorist sympathizers, the public, and state sponsors augment their terrorist support resulting in more recruitment and attacks. Other essential trade-offs are identified and discussed. Additionally, we formulate a two-stage canonical game-theoretic model involving a targeted government and a terrorist group adversary. This model accounts for defensive and proactive policies but also myriad scenarios. As such, it serves as a foundation to explain modern counterterrorism literature, as illustrated by a discussion of iconic contributions to the study of counterterrorism.
Indo Pacific
“Why China’s Export Controls on Germanium and Gallium May Not Be Effective” Stimson Center
In 2010, China adopted a series of export controls on rare earth exports to Japan, the United States, and the European Union. Those export controls led to massive smuggling and pushed Japan and the United States to diversify their rare earth supply chains, cutting at least 30% of China’s market share of the global supply of rare earths from 2010 to 2021. China’s recent export controls on gallium and germanium are now increasing calls in more countries for a similar diversification of supply chains of critical materials away from China. While it can take years to diversify supply chains, and the cost of doing so is often prohibitive, the new controls will force countries to continue to advance policies that reduce their dependence on China for critical materials.
“Podcast: Japan and NATO in 2023” International Institute for International Affairs
The Podcast of IISS experts unpacks the 2023 NATO Summit in Vilnius, Lithuania, and the developments around Japan-NATO cooperation (as NATO has opened an office in Tokyo and is likely to open more offices in the Indo-Pacific), along with Japan’s responses to Russia’s war in Ukraine.
“Why is Italy Withdrawing From China’s Belt and Road Initiative?” Council on Foreign Relations
In 2019, during Chinese President Xi Jinping’s visit to Rome, Italy shocked the United States and Europe by becoming the first Group of Seven (G7) country to join China’s Belt and Road Initiative (BRI). But this past week, Italian Prime Minister Giorgia Meloni indicated joining the BRI was a “big mistake,” and Italian Defense Minister Guido Crosetta called Italy’s decision to join the BRI an “improvised and atrocious act.” So why is Italy pulling out now?
Russia
“Putin and Prigozhin: It’s Complicated” Belfer Center for International Affairs, Harvard University
In late June, Yevgheny Prigozhin led a 36-hour mutiny against President Vladimir Putin’s military leadership, driving his Wagner Forces within 200 kilometers of Moscow. After quickly backing down, Prigozhin announced he was going into exile in Belarus, and the Wagner Forces were going to be disbanded and absorbed into the Russian Army. Neither happened. Prigozhin appeared in Moscow last week at the Russia-Africa Leaders’ Summit, shaking hands with various African leaders. And the Wagner Group apparently has not been disbanded. So what is going on? It’s complicated.
Africa
“Kenya’s debt struggles go far deeper than Chinese loans” Chatham House
Despite recent claims of a Chinese state-linked hacking team carrying out systematic cyber-attacks on Kenyan government institutions being denounced by Kenya’s Ministry of Interior as ‘sponsored propaganda’, Kenya’s debt burden to China is under scrutiny once again as the alleged attacks were reportedly driven by a desire to assess the status of repayments. Chinese loans account for roughly 64 percent of Kenya’s current stock of bilateral external debt. And the question being asked now is did the Kenyan government post the strategic Mombasa Port as collateral for these loans, feeding accusations of China indulging in ‘debt-trap diplomacy’ both in Kenya and across the continent.
“From Russia, with little to show for it” Institute for Security Studies
Russian President Vladimir Putin was hoping for a record turnout of African leaders at the second Russia-Africa summit in St Petersburg last week to show the West he wasn’t isolated after all. He didn’t quite pull that off. Only 17 African heads of state attended – far fewer than the 43 at the 2019 Sochi summit. So if Putin got some recognition, what did Africa get? Not much, judging by the joint declaration, which looks as though it was written almost exclusively by the Kremlin. It is full of statements implicitly harnessing Africa in support of Moscow’s posture against Western sanctions imposed on it for invading Ukraine.
Chart of the Week
Looking at U.S. Sanctions in 2022
The Center for a New American Security just published a new report looking at the massive increase of individuals and entities placed under sanctions. In 2022, 2,275 persons were added to the Specially Designated Nationals and Blocked Persons (SDN) list. The below chart shows how Russian persons and entities were the primary targets of the sanctions:
