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1191. Countering global oil theft: responses and solutions

Author:
Etienne Romsom
Publication Date:
03-2022
Content Type:
Working Paper
Institution:
United Nations University
Abstract:
This second of two papers on global oil theft discusses ways to reduce oil theft, misappropriation, and fraud. At US$133 billion per year, oil is the largest stolen natural resource globally, while fuel is the most smuggled natural resource. Oil theft equates to 5–7 per cent of the global market for crude oil and petroleum fuels. It is so engrained in the energy supply chain that thefts are priced in by traders and tolerated by many shipping companies as petty theft. Oil theft and related insecurity have substantial negative economic effects on developing countries, whether they produce oil or not. In 2012, non-oil-producing Benin saw a 28 per cent drop in taxable income after a spate of oil tanker hijacking incidents in the Gulf of Guinea in 2011. In Nigeria, the oil capacity shut-in and amount of oil deferred is more than twice the amount estimated as stolen, with a US$20 billion annual loss in petroleum profit tax—63 per cent of total government tax revenue in 2019. Organized oil crime syndicates are often transnational and conduct theft and fraud professionally, exploiting gaps in jurisdiction and adapting their practices when law enforcement becomes more effective. They evolve from ship piracy to stealing tanker cargoes to kidnapping tanker crews; from physical ransom of assets to digital hijacking via ransomware. The proceeds of oil theft often finance other organized crime, and it triggers violence against the community and in crime-on-crime activities. Twelve commonalities in oil theft and fraud have been identified that can direct international solutions, in three target areas: stolen oil volumes, stolen oil transport, and stolen oil money. Prosecution for acts of bribery offers opportunities for action: transport of or payment for illegal oil could constitute a bribe under the US Foreign Corrupt Practice Act if government officials were involved in the transaction or shipment. Bribe charges could be raised for paid ‘services’ that facilitate oil theft (through action or non-action).
Topic:
Corruption, Oil, Piracy, Cybersecurity, Fossil Fuels, Tax Evasion, and Theft
Political Geography:
Global Focus

1192. Corruption and crisis: do institutions matter?

Author:
Shrabani Saha and Kunal Sen
Publication Date:
03-2022
Content Type:
Working Paper
Institution:
United Nations University
Abstract:
While the short-term effects of the COVID-19 pandemic on lives and livelihoods are well understood, we know little about the effect of the pandemic for longer-term outcomes such as corruption. We look at the historical data on political and economic crises to assess what we can learn from the long-term effects of past crises on corruption. We hypothesize that strong rule of law institutions may ameliorate the possible adverse effects of political and economic crises on corruption. We test our hypotheses using panel data for over 100 countries during the years 1800– 2020. The results suggest heterogeneous effects depending on the type of crisis and how we measure it. We find that rule of law institutions can control corruption in cases of political violence and economic slowdown, but the effect is not seen for democracy breakdowns, coups, armed conflict and civil war, and economic crisis such as currency and debt crisis.
Topic:
Corruption, Politics, Rule of Law, Institutions, Data, COVID-19, and Economic Crisis
Political Geography:
Global Focus

1193. Prosperity and Resilience: Diverse Production and Comparative Advantage in Modern Economies

Author:
David Henig and Anna Guildea
Publication Date:
01-2022
Content Type:
Working Paper
Institution:
European Centre for International Political Economy (ECIPE)
Abstract:
A common version of trade theory suggests that countries will specialise in a limited number of products. Using the example of David Ricardo from 1817, England specialises in cloth and Portugal in producing wine – and then they trade with each other to mutual benefit. However, this is a crude version of comparative advantage that routinely leads to political concerns about trade. Today the prime concern is that Europe and other developed countries have become too dependent on China by allowing the logic of comparative advantage to work. In short, trade has made us vulnerable. The observed reality is different. Most advanced economies produce and export a broad range of goods and services. Their governments have similar aspirations to develop and support diverse manufacturing and services, including in the most traded global sectors such as pharmaceuticals, automotive, business services, and food and drink. Modern specialisation comes in countries producing various, but not all, products within global supply chains. Patterns of trade suggest such specialisation has allowed countries to both grow and become resilient to individual shocks. Knowledge and ownership of the whole supply chain is more important than producing everything.
Topic:
Globalization, Economy, Services, Resilience, WTO, and Production
Political Geography:
Europe and Global Focus

1194. Processing Trade and Global Supply Chains: Towards a Resilient “GVC 2.0” Approach

Author:
Lucian Cernat
Publication Date:
05-2022
Content Type:
Policy Brief
Institution:
European Centre for International Political Economy (ECIPE)
Abstract:
In the current global context marked by economic fragility, growing uncertainty and geopolitical conflicts, ensuring the smooth functioning of global supply chains becomes more important than ever. Supply shortages, higher freight costs, higher commodity prices and strong demand increase will trigger inflationary pressures for all economic sectors dependent on global value chains (GVCs). As part of global efforts to enhance the resilience of GVCs, this paper makes the case for a broader discussion about the untapped potential of processing trade, a relatively unknown trade facilitation option available in many countries around the world. Processing trade has been credited with stimulating China’s participation in GVCs, in combination with foreign direct investment (FDI) attraction and industrial upgrading. However, processing trade is not just a Chinese phenomenon. In the EU, significant trade flows (over 200 billion euros in 2021 alone) benefitted from a double-digit trade cost reduction, thanks to the EU processing trade provisions. Different types of processing trade arrangements exist in over 70 countries worldwide (including in the EU), as a way to facilitate the integration of developing countries in global production chains. However, these unilateral schemes have different requirements and co-exist without any attempt to facilitate their inter-operability along complex global supply chains. This paper argues that there is a pressing need for a global reflection on how best to promote a better integration between these national processing trade schemes. One option is to promote a “GVC 2.0” approach that offers key recommendations and best practices for processing trade along GVCs. Such a coordinated “GVC 2.0” trade facilitation initiative would not only make GVCs more resilient for countries that depend on global sourcing for their critical economic activities, but it will also reduce the inflationary effect generated by the unnecessary trade costs associated with GVC activities.
Topic:
Political Economy, European Union, Trade, Resilience, and Supply Chains
Political Geography:
Europe, Asia, and Global Focus

1195. A Task-Based Theory of Occupations with Multidimensional Heterogeneity

Author:
Sergio Ocampo
Publication Date:
01-2022
Content Type:
Working Paper
Institution:
Centre for Human Capital and Productivity (CHCP), Western University
Abstract:
I develop an assignment model of occupations with multidimensional heterogeneity in production tasks and worker skills. Tasks are distributed continuously in the skill space, whereas workers have a discrete distribution with a finite number of types. Occupations arise endogenously as bundles of tasks optimally assigned to a type of worker. The model allows us to study how occupations respond to changes in the economic environment, making it useful for analyzing the implications of automation, skill-biased technical change, offshoring, and worker training. Using the model, I characterize how wages, the marginal product of workers, the substitutability between worker types, and the labor share depend on the assignment of tasks to workers. I introduce automation as the choice of the optimal size and location of a mass of identical robots in the task space. Automation displaces workers by replacing them in the performance of tasks, generating a cascading effect on other workers as the boundaries of occupations are redrawn.
Topic:
Occupation, Automation, Skills, and Tasks
Political Geography:
Global Focus

1196. Immigrant entrepreneurship in startup cities — what works in which context?

Publication Date:
02-2022
Content Type:
Video
Institution:
MIT Center for International Studies
Abstract:
Migrants are often considered to be ‘natural entrepreneurs’. This notion is based on a presumed inclination to take risks, an openness to new experiences, and a higher willingness to adapt than their local counterparts. Migrants found more businesses relative to the local population in many countries, despite facing additional challenges in the startup process. To support them in overcoming these challenges and to leverage their entrepreneurial potential, more and more organizations create targeted offers for this group of entrepreneurs — particularly in cities with vibrant entrepreneurial ecosystems. Increasingly, these ‘newcomer entrepreneurs’ find that their particular needs are better recognised and taken into account. Despite this, it is still unclear which interventions actually work for which target group, and in which context. Which role do the different stakeholders and systemic mechanisms in the local entrepreneurial ecosystem play?
Topic:
Economics, Entrepreneurship, Business, and Immigrants
Political Geography:
Global Focus

1197. Difficult Debate on an Intellectual Property Protection Waiver to Fight COVID-19

Author:
Szymon Zaręba
Publication Date:
01-2022
Content Type:
Special Report
Institution:
The Polish Institute of International Affairs
Abstract:
The negotiations currently taking place at the WTO on the suspension of, among others, patent protection for vaccines and medicines against COVID-19, are at a standstill. This creates a risk of widening the rift between developing countries, which mostly support the idea, and some developed countries, which oppose it. It also makes it more difficult to increase the supply of patented items, particularly of vaccines, to an extent undermining other efforts by countries and international organisations to contain the pandemic. It is in the interest of Poland and the EU to overcome this impasse.
Topic:
Intellectual Property/Copyright, European Union, Vaccine, COVID-19, and WTO
Political Geography:
Europe, Poland, and Global Focus

1198. The Strategic Implications of the Tashkent Conference

Author:
Urs Unkauf
Publication Date:
01-2022
Content Type:
Journal Article
Journal:
Baku Dialogues
Institution:
ADA University
Abstract:
This essay is devoted to a consideration of a matter of fundamental geopolitical importance that has gone largely unnoticed in the West, to its detriment. The trigger event, so to speak, was a remarkable conference that took place not in Washington, Brussels, or Moscow—but in Tashkent. On 15‑16 July 2021, Uzbekistan’s capital hosted delegations from nearly 50 countries, among them China, Russia, India, Turkey, Azerbaijan, and all the Central Asia countries, at the level of foreign ministers or above. To understand the issues at play and the consequences thereof, we will need to spend some time discussing what actually took place during the conference itself, which was entitled “Central and South Asia: Regional Connectivity: Challenges and Opportunities.” In addition to relating the explicit agenda of the conference, we will also examine its broader agenda (whether intended or not) and conclude with an examination of its potentially far‑reaching geostrategic implications. The Tashkent conference was geared not only to government officials, but also towards leading scholars, experts, and media representatives from all over the world who follow developments in at least one of these two regions. In his opening address, Uzbekistan’s President Shavkat Mirziyoyev affirmed his country’s readiness to take up new leadership responsibilities in the region, which aligns with the domestic economic and social reform agenda he launched upon coming to power following the death of his predecessor, Islam Karimov, in September The Strategic Implications of the Tashkent Conference 2016. The host’s speech was followed by opening statements from Afghanistan’s President Ashraf Ghani and Pakistan’s Prime Minister Imran Khan, whose delegations also exchanged informal views during the conference. Here a somewhat digressive remark is in order. When the conference was in its planning stage, the fall of the Ghani government in Afghanistan had not been anticipated. Still, one of the conference’s working group sessions was devoted to the devolving situation in Afghanistan. By that stage, the conference’s more astute participants were seeing the writing on the wall. Those who could not, of course, came to their senses less than a month later. Either way, the Taliban’s takeover of the country has put both Central and South Asia more firmly on the international geopolitical agenda— the recent events in Kazakhstan, which began as this issue of Baku Dialogues was being finalized, have also played a role in drawing attention back to the Silk Road region. But to come back to Mirziyoyev’s opening address. In the context of announcing a new, open foreign policy strategy for the country, Uzbekistan’s President made it clear that his country is centrally focused on strengthening regional connectivity. His announcement stressed that the focus would be on further deepening economic and cultural cooperation between Central Asia and South Asia—two regions that are linked historically as well as economically yet have not so far been able to transform this inherited potential towards proper policymaking in recent years. The Tashkent conference was advertised as being about enhancing regional interconnectivity, trade, and cooperation between Central Asia and South Asia—as well as presenting the host country’s new cross‑regional foreign policy strategy. But as Edward Lemon wrote in the Fall 2021 edition of Baku Dialogues, the conference also served to demonstrate that the emerging regionalism—a topic raised by the concerning countries themselves and not from outside—will be a leitmotif for future geostrategic developments in the Silk Road region.
Topic:
Diplomacy, International Trade and Finance, Infrastructure, Geopolitics, and Silk Road
Political Geography:
Global Focus

1199. Are Gender Inclusive Militaries Better at Integrating Disruptive Technologies?

Author:
Shira Eini Pindyck
Publication Date:
05-2022
Content Type:
Policy Brief
Institution:
University of California Institute on Global Conflict and Cooperation (IGCC)
Abstract:
Recent advances in big data and analytics, cyber security, automation, and artificial intelligence can make critical contributions to the demonstration of power on the international stage. New technologies not only offer militaries the ability to conduct operations with greater effectiveness but also reduce the potential human cost of operations. In an increasingly digitized world, organizations that do not adopt and leverage these advances can become inefficient and even fall by the wayside. Yet, despite the immense promise of emerging technologies, many organizations struggle to integrate and utilize them. This is true in both the military and business sectors. For business organizations, a failure to adopt and use novel technologies may threaten profits and even their survival. For militaries, where soldiers’ lives are on the line, the consequences can be even more severe. Why is the integration of new technologies often so difficult? This policy brief highlights an important and overlooked reason, namely how gender policy can affect resistance to organizational change. Gender policy reform requires organizations to invest resources in the recruitment and retainment of an inclusive workforce, and therefore demands that organizations be flexible and resilient. Flexibility and resilience are also required to integrate disruptive innovations. Rather than trying to chain a new technology to old systems of ascension and reward, organizations that want to advance technologically must rethink their incentive systems and work hard to restructure entrenched hierarchies.
Topic:
Defense Policy, National Security, Science and Technology, International Security, Military Affairs, Innovation, and Geoeconomics
Political Geography:
Global Focus

1200. Inequality Kills: The unparalleled action needed to combat unprecedented inequality in the wake of COVID-19

Author:
Oxfam Publishing
Publication Date:
01-2022
Content Type:
Policy Brief
Institution:
Oxfam Publishing
Abstract:
The wealth of the world’s 10 richest men has doubled since the pandemic began. The incomes of 99% of humanity are worse off because of COVID-19. Widening economic, gender, and racial inequalities—as well as the inequality that exists between countries—are tearing our world apart. This is not by chance, but choice: “economic violence” is perpetrated when structural policy choices are made for the richest and most powerful people. This causes direct harm to us all, and to the poorest people, women and girls, and racialized groups most. Inequality contributes to the death of at least one person every four seconds. But we can radically redesign our economies to be centered on equality. We can claw back extreme wealth through progressive taxation; invest in powerful, proven inequality-busting public measures; and boldly shift power in the economy and society. If we are courageous, and listen to the movements demanding change, we can create an economy in which nobody lives in poverty, nor with unimaginable billionaire wealth—in which inequality no longer kills.
Topic:
Health, Inequality, Pandemic, and COVID-19
Political Geography:
Global Focus