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521. Third UN Conference on Law of the Sea (1973–1982): Promoting Peace, Security, Law, and Order in the Oceans

Author:
Monika Chansoria
Publication Date:
04-2019
Content Type:
Policy Brief
Institution:
Japan Institute Of International Affairs (JIIA)
Abstract:
The Third UN Conference on the Law of the Sea spanning between 1973 and 1982 remains engraved as an exceptional event in the pages of history of international relations, being one of the most ambitious projects of the United Nations, represented with nearly all of the international community. The Conference was viewed as a test of constructive international cooperation in an increasingly interdependent system where such cooperation was extremely vital.1 By means of Resolution 2750C(XXV), the UN General Assembly on December 17, 1970, decided to convene the Third Conference on the Law of the Sea in 1973, and instructed the Committee on the Peaceful Uses of the Sea-Bed and the Ocean Floor beyond the Limits of National Jurisdiction to act as a preparatory body for this conference. The Committee held six sessions and a number of additional meetings in New York and Geneva between 1971 and 1973 following which the UN General Assembly requested the UN SecretaryGeneral to convene the first session of the Third UN Conference on the Law of the Sea in 1973 in New York to deal with organizational matters, and a second session in 1974, as well as subsequent sessions if necessary, to deal with substantive work (as per Resolution 3029 (XXVII).
Topic:
Security, United Nations, Law, Law of the Sea, and Peace
Political Geography:
Global Focus

522. Countering Foreign Influence and Inter ference in Open Societies —A Japanese Perspective on Authoritarian Infiltration

Author:
Hideshi Tokuchi
Publication Date:
02-2019
Content Type:
Policy Brief
Institution:
Japan Institute Of International Affairs (JIIA)
Abstract:
It is almost a cliché that Australia and New Zealand are canaries in the coal mine for Chinese attempts at exerting political influence. In fact, Chinese influence is not a topic that affects just Oceania. It is already a serious challenge that confronts all democracies and open societies. According to Clive Hamilton’s “Silent Invasion,” a Chinese diplomat who sought political asylum in Australia told Hamilton that Australia’s openness, relatively small population, a large number of Chinese immigrants and commitment to multiculturalism have weakened Australia’s capacity to recognize and defend against the Chinese infiltration, but all democracies and open societies are susceptible to the threat
Topic:
Authoritarianism, Geopolitics, and Foreign Interference
Political Geography:
Japan, China, and Asia

523. 1919 Paris Peace Conference Centennial: Recollecting India’s Representation and Participation

Author:
Monika Chansoria
Publication Date:
01-2019
Content Type:
Policy Brief
Institution:
Japan Institute Of International Affairs (JIIA)
Abstract:
The Paris Peace Conference opened on January 18, 1919, paving way for an ensuing legacy of peacemaking. It aimed at fortifying the conceptual foundations in reference to the very essential premise on which peacemaking rests – i.e., bringing a conflict/war to a halt, and thereafter initiating a diplomatic process that seeks to provide a platform for initiating the process of reconciliation. Held at the Palace of Versailles, the Peace Conference saw delegates from 27 parties, with rigorous deliberations and recommendations that eventually got included into the Treaty of Versailles with Germany, held at the Hall of Mirrors at Versailles, on June 28, 1919.
Topic:
Diplomacy, Treaties and Agreements, History, and Peace
Political Geography:
India and Asia

524. Can EU competition law address market distortions caused by state-controlled enterprises?

Author:
Matthew Heim
Publication Date:
12-2019
Content Type:
Policy Brief
Institution:
Bruegel
Abstract:
This Policy Contribution considers whether European competition law could be applied more directly to state owned enterprises that create an unlevel playing field in Europe due to the support they receive from their home governments. This issue is now a priority for many Member States and the European Commission given the impact on European economic autonomy. Competition law may not be the appropriate tool for addressing the granting of illegal subsidies or other forms of support in third countries but it may be more effective than previously thought in dealing with the effect of state-owned entities that distort the internal market. If SOEs are not be resource-constrained or even profit maximising, such SOEs could be unconstrained by competitive pressures and therefore possess a de facto level of market power. By evolving existing exclusionary antitrust theories of harm, such as predatory pricing, to fit the specificities of SOEs, this Policy Contribution argues that it should be possible to add further tools to the EU’s toolbox. In any event, as part of its efforts to address the distortive effects of foreign state ownership and subsidies in the internal market, the Commission should develop a coherent and proactive competition policy to provide guidance to the market.
Topic:
Markets, Governance, Macroeconomics, and Strategic Competition
Political Geography:
Europe

525. Bridging the divide: new evidence about firms and digitalisation

Author:
Reinhilde De Veugelers
Publication Date:
12-2019
Content Type:
Policy Brief
Institution:
Bruegel
Abstract:
Using new evidence on the digitalisation activities of firms in the European Union and the United States, we document a trend towards digital polarisation based on firms’ use of the latest digital technologies and their plans for future investment in digitalisation. A substantial share of firms are not implementing any state-of-the-art digital technologies and do not have plans to invest in digitalisation. However, there is also a substantial share of firms that are already partially or even fully implementing state-of-the-art digital technologies in their businesses and that plan to further increase their digitalisation investments. Small Manufacturing firms and old small firms in services are significantly more likely to be and remain non-active in terms of digitalisation. Our results do not provide any evidence that EU firms are more likely than their US counterparts to be stuck on the wrong side of the digitalisation divide. Taking into account firm size and firm age, there are no significant differences between the EU and the US in terms of having more or fewer persistently non-digital firms. As persistently digitally-inactive firms are also less likely to be innovative, to add employees or to command higher mark-ups, it is important for policymaking to remove barriers that trap these firms in persistent digital inactivity. Lack of access to finance is a major barrier for EU firms compared to their US counterparts, particularly for the EU’s persistently non-digital firms, and especially for older, smaller companies in services. Improving their access to finance might therefore go a long way towards addressing the corporate digitalisation divide in the EU.
Topic:
Science and Technology, Innovation, Strategic Competition, and Digital Revolution
Political Geography:
Europe, North America, and United States of America

526. The European Union-Russia-China energy triangle

Author:
Georg Zachmann
Publication Date:
12-2019
Content Type:
Policy Brief
Institution:
Bruegel
Abstract:
We argue that energy relations between the EU and Russia and between China and Russia influence each other. We analyse their interactions in terms of four areas: oil and gas trading, electricity exchanges, energy technology exports and energy investments. We discuss five key hypotheses that describe the likely developments in these four areas in the next decade and their potential impact on Europe: 1. There is no direct competition between the EU and China for Russian oil and gas 2. China and the EU both have an interest in curbing excessive Russian energy rents 3. The EU, Russia and China compete on the global energy technology market, but specialise in different technologies 4. Intercontinental electricity exchange is unlikely 5. Russia seems more worried about Chinese energy investments with strategic/political goals, than about EU investments We find no evidence of a negative spillover for the EU from the developing Russia-China energy relationship. But, eventually, if these risks – and in particular the risk of structural financial disintermediation – do materialise, central banks would have various instruments to counter them.
Topic:
Climate Change, Energy Policy, Oil, and Europe Union
Political Geography:
Russia, China, and Europe

527. The next generation of digital currencies: in search of stability

Author:
Gregory Claeys and Maria Demertzis
Publication Date:
12-2019
Content Type:
Policy Brief
Institution:
Bruegel
Abstract:
Four major developments have challenged the status quo and reopened the debate on the forms that money will take in the future: 1) use of cash as a medium of exchange has declined; 2) distributed ledger technology (DLT) has led to the emergence of thousands of digital cryptocurrencies; 3) some global tech giants are planning to provide private digital currencies to their billions of users in the form of stablecoins; and 4) in turn, public authorities are thinking about providing their own digital currencies to the general public. These developments raise questions about the implications for financial stability, the transmission of monetary policy and financial intermediation. This Policy Contribution focuses on the consequences stablecoins and central bank digital currencies could have. Stablecoins, such as Facebook’s Libra, differ from earlier generations of cryptocurrencies in three fundamental ways. First, they would start with large networks of users and global accessibility, two pivotal features for the critical uptake of a new currency. Second, given the current limitations of DLT, including in terms of energy efficiency, new stablecoins would rely on (more) centralised systems to validate transactions. Third, stablecoins would focus particularly on reducing the volatility in the value of the new currency. These new features of stablecoins attempt to correct some of the critical deficiencies identified in first-generation cryptocurrencies, which meant they did not acquire the main functions of money. However, new stablecoins raise other questions and potentially create new problems. One issue could arise from the more centralised (permissioned) validation system, which could lead to collusion problems. Another issue could arise from the reserve system that is supposed to ensure the stability of stablecoins, such as Libra, which could be incompatible with the profit maximisation behaviour of a private issuer. Facebook’s Libra plan has been a wake-up call to central banks and governments which, afraid of losing their monetary sovereignty, have renewed their interest in central bank digital currencies (CBDCs) as a potential solution. CBDCs could make private digital currencies less attractive and slow down their adoption. But there are other reasons to give the general public access to central bank liabilities. One important reason to provide CBDCs to citizens is that if cash disappears, citizens will lose direct access to sovereign money. Another benefit of the introduction of CBDCs is that monetary policy could be strengthened by transmitting it directly to the general public. However, the introduction of CBDCs could also be disruptive and create risks. In particular, CBDCs could have major consequences for financial intermediation. These risks would have to be evaluated by policymakers before any decisions are taken. If CBDCs are introduced, central banks would have to carefully calibrate their properties to minimise these risks. But, eventually, if these risks – and in particular the risk of structural financial disintermediation – do materialise, central banks would have various instruments to counter them.
Topic:
Science and Technology, Central Bank, Currency, Cryptocurrencies, and European Parliament
Political Geography:
Europe

528. Crisis management for euro-area banks in central Europe

Author:
Alexander Lehmann
Publication Date:
11-2019
Content Type:
Policy Brief
Institution:
Bruegel
Abstract:
The deep involvement of a number of euro-area banking groups in central and southeastern Europe has benefitted the host countries and has strengthened the resilience of those banking groups. But this integration has become less close because of post-financial crisis national rules that require banks to hold more capital at home, or other ring-fencing measures. There is a risk integration might be undermined further by bank resolution planning, which is now gathering pace. Regulators and banks will need to decide between two distinct models for crisis resolution, and this choice will redefine banking networks. Most efficient in terms of preserving capital and the close integration of subsidiary operations would be if the Single Resolution Board – the banking union’s central resolution authority – takes the lead for the entire banking group. However, this will require parent banks to hold the subordinated debts of their subsidiaries. Persistent barriers to intra-group capital mobility – or the option for home or host authorities to impose such restrictions – will ultimately render such schemes unworkable. The second model would involve independent local intervention schemes, which European Union countries outside the banking union are likely to call for. This will require building capacity in local debt markets, and clarifying creditor hierarchies. Exposure to banking risks will ultimately need to be borne by host-country investors. Bail-in capital issued by subsidiaries to their parents cannot be a substitute because it would expose the home country to financial contagion from the host. To sustain cross-border linkages, banking groups and their supervisors will need to make bank recovery plans more credible, and to strengthen cooperation in resolution colleges (platforms that bring together all relevant parties in resolution planning and execution). Within the banking union there is no justification for the various ring-fencing measures that have impeded the flow of capital and liquidity within banking groups.
Topic:
Governance, European Union, Regulation, Banks, and Macroeconomics
Political Geography:
Europe

529. What do we know about cyber escalation? Observations from simulations and surveys

Author:
Benjamin Jensen and Brandon Valeriano
Publication Date:
11-2019
Content Type:
Policy Brief
Institution:
Atlantic Council
Abstract:
Do cyber operations alter how states respond to international crises in a way that creates incentives for decision makers to cross the Rubicon and use military force to settle disputes? This question is central to current cyber strategy debates and the idea of persistent engagement and defending forward in cyberspace. The answer is surprising: no. Based on the evidence, cyber operations offer a valuable escalatory offramp.
Topic:
Security, Science and Technology, Cybersecurity, and Crisis Management
Political Geography:
Global Focus

530. Belt and Road in Latin America: A regional game changer?

Author:
Pepe Zhang
Publication Date:
10-2019
Content Type:
Policy Brief
Institution:
Atlantic Council
Abstract:
Four new BRI trends to watch: (i) enforcement of transparency, debt, and environmental safeguards; (ii) growing participation of the private sector; (iii) the role of the advanced economies in BRI; and (iv) new BRI sectors beyond infrastructure Governments and companies in Latin America and the Caribbean should engage and help shape an evolving BRI, mindful of both the opportunities and risks involved The United States can play a key role in setting standards for economic development projects in the region and beyond
Topic:
Energy Policy, Environment, Financial Markets, and Trade
Political Geography:
China, Asia, South America, and Latin America