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17031. The corporate benefits of the euro: Finnish companies cannot live without a common currency

Author:
Timo korkeamäki
Publication Date:
04-2012
Content Type:
Policy Brief
Institution:
Finnish Institute of International Affairs
Abstract:
The costs of euro membership have been a topic of lively political debate in recent years, and they have received ample media attention. In contrast, numerical estimates on the benefits of the euro have been practically non-existent. While the corporate benefits of the euro have been widely documented in the academic literature, the practical value of those publications has suffered from their technical complexity. Several experts have linked the fast growth of corporate bond markets in Europe since 1999 to the introduction of the euro. With growing arm's length credit markets in Europe, companies' access to financing has improved significantly. Companies from countries with small and unstable legacy currencies, such as Finland, have benefited comparably more from the widened financial markets. The cost savings due to the lowered cost of debt are non-trivial. For a set of large Finnish companies alone, the narrowing spread between their interest expenses and those of their German counterparties has resulted in after-tax cost savings of over €400 million each year. Sweden, Norway, and Denmark may have received some free-rider benefits while staying outside the currency union. However, it is difficult to estimate whether such benefits would have been obtainable had Finland chosen to keep its own currency. Reductions in the cost of financing should increase companies' ability to invest, and thus these savings are likely to have multiplicative effects on the economy for years to come.
Topic:
Economics, International Trade and Finance, Markets, and Monetary Policy
Political Geography:
Europe

17032. Watching a dragon's egg hatch: The makings of a Sinocentric world?

Author:
Jyrki Kallio
Publication Date:
04-2012
Content Type:
Working Paper
Institution:
Finnish Institute of International Affairs
Abstract:
As China's hard power is growing, the Party-state is keen to construct a new narrative which legitimizes China's position as a world leader also from the soft power perspective. It has even been suggested that a Chinese international relations theory or model will inevitably emerge as a consequence of China's growing role on the world stage on the one hand and the rise of traditional values in China on the other.
Topic:
Foreign Policy, Development, Economics, International Trade and Finance, Power Politics, and Culture
Political Geography:
China and Israel

17033. The beginning of the end? The future of international engagement in Afghanistan

Author:
Timo Behr and Charly Salonius-Pasternak
Publication Date:
04-2012
Content Type:
Working Paper
Institution:
Finnish Institute of International Affairs
Abstract:
States which contribute to various international efforts in Afghanistan will find it increasingly difficult to balance a need to show long-term commitment with an unpredictable political and quickly changing operating environment. Recent events in Afghanistan are threatening to undermine the plans for an orderly transition of security responsibilities to Afghan authorities by the end of 2014. Countries must be ready to adjust contributions in both size and task during both 2012 and 2013. Germany has pledged to only gradually withdraw its forces and maintain its focus on partnering and training, despite an increasingly unstable environment. Current planning also foresees a German commitment in the post-2014 period. Finland will increasingly focus on civilian crisis management efforts and development assistance, and will stay engaged and committed as long as its closest partners also do so. Sweden is set to continue leading a Provincial Reconstruction Team (PRT), but post-2014 commitments are unclear. The United States is set to return to 'pre-surge' force levels (though with a different force structure) of around 68,000 soldiers by autumn 2012. Further withdrawals of up to 30,000 soldiers are being discussed.
Topic:
Conflict Resolution, Defense Policy, Peace Studies, and War
Political Geography:
Afghanistan, United States, Finland, Germany, and Sweden

17034. Tunisie : relever les défis économiques et sociaux

Publication Date:
06-2012
Content Type:
Working Paper
Institution:
International Crisis Group
Abstract:
Dans un contexte arabe marqué par des transitions bâclées ou sanglantes, la Tunisie fait encore figure d'exception. Depuis le 14 janvier 2011, ce n'est pas seulement la tête de l'ancien régime, symbolisé par l'ancien président Zine al-Abidine Ben Ali, qui est tombée. C'est tout un système qui se trouve bouleversé, principalement dans le cadre d'un consensus relativement large. Mais les défis qui pourraient menacer ces progrès existent. Parmi ceux-ci, deux en particulier sont étroitement liés : restaurer la sécurité et mener une véritable lutte contre l'impunité. Pour le nouveau gouvernement d'union, dénommé Troïka et emmené par le mouvement islamiste An-Nahda, la clé demeure dans un dialogue large, permettant de réformer les forces de sécurité sans trop les provoquer, rendre justice aux victimes de la dictature sans céder à la chasse aux sorcières, et garantir une justice efficace tout en tenant compte des limites du système judiciaire en place.
Topic:
Corruption, Democratization, Economics, Regime Change, and Labor Issues
Political Geography:
Arabia and North Africa

17035. The Influence of Domestic Politics on Philippine Foreign Policy: The case of Philippines-China relations since 2004

Author:
Aileen S. P. Baviera
Publication Date:
06-2012
Content Type:
Working Paper
Institution:
Centre for Non-Traditional Security Studies, S. Rajaratnam School of International Studies
Abstract:
This paper sets out to explore the role of domestic politics in the shaping and implementing of Philippine foreign policy and its relations with China. It examines how domestic politics have driven Philippine foreign policy behaviour towards China; whether the Philippine Government has successfully managed the domestic drivers in promoting the state's interests in its relations with China, and whether there are major constraints that have prevented the attainment of more desirable outcomes in the bilateral ties. It looks at three cases: the Philippines-China joint marine seismic undertaking in the South China Sea; China's participation in the national broadband network project and a railway project; and Philippine reactions to China's execution of three Filipino drug mules.
Topic:
Conflict Resolution, Foreign Policy, Bilateral Relations, and Narcotics Trafficking
Political Geography:
China, Israel, and Philippines

17036. Capital Requirements under Basel III in Latin America: The Cases of Bolivia, Colombia, Ecuador and Peru

Author:
Liliana Rojas-Suarez, Arturo J. Galindo, and Marielle del Valle
Publication Date:
05-2012
Content Type:
Working Paper
Institution:
Center for Global Development
Abstract:
A number of banks in developed countries argue that the new capital requirements under Basel III are too stringent and that implementing the proposed regulation would require raising large amounts of capital, with adverse consequences on credit and the cost of finance. In contrast, many emerging market economies claim that their systems are adequately capitalized and that they have no problems with implementing the new capital requirements. This paper conducts a detailed calculation of capital held by the banks in four Latin American countries—known as the Andean countries: Bolivia, Colombia, Ecuador and Peru—and assesses the potential effects of full compliance with the capital requirements under Basel III. The conclusions are positive and show that while capital would decline somewhat in these countries after they make adjustments to comply with the new definition of capital under Basel III, they would still meet the Basel III recommendations on capital requirements. More importantly, these countries would hold Tier capital to risk-weighted-asset ratios significantly above the 8.5 percent requirement under Basel III. That is, not only the quantity, but also the quality of capital is adequate in the countries under study. While encouraging, these results should not be taken as a panacea since the new regulations are only effective if coupled with appropriate risk management and supervision mechanisms to control the build-up of excessive risk-taking by banks. Further research into these areas is needed for a complete assessment of the strength of banks in the Andean countries.
Topic:
Debt, Economics, International Trade and Finance, and Monetary Policy
Political Geography:
Colombia, Latin America, Peru, Ecuador, and Bolivia

17037. Haiti: Where Has All the Money Gone?

Author:
Vijaya Ramachandran and Julie Walz
Publication Date:
05-2012
Content Type:
Working Paper
Institution:
Center for Global Development
Abstract:
Since the 2010 earthquake, almost $6 billion has been disbursed in official aid to Haiti, a country with a population of just under 10 million. An estimated $3 billion has been donated to NGOs in private contributions in addition to official aid. The United States Government alone has disbursed almost $2 billion of this total amount and has pledged over $3 billion for relief and reconstruction.
Topic:
Corruption, Humanitarian Aid, Non-Governmental Organization, and Foreign Aid
Political Geography:
United States, Caribbean, and Haiti

17038. Adolescent Fertility in Low- and Middle-Income Countries: Effects and Solutions

Author:
Amanda Glassman, Kate McQueston, and Rachel Silverman
Publication Date:
05-2012
Content Type:
Working Paper
Institution:
Center for Global Development
Abstract:
Adolescent fertility in low- and middle-income countries presents a severe impediment to development and can lead to school dropout, lost productivity, and the intergenerational transmission of poverty. However, there is debate about whether adolescent pregnancy is a problem in and of itself or merely symptomatic of deeper, ingrained disadvantage. To inform policy choices and create a revised research agenda for population and development, this paper aggregates recent quantitative evidence on the socioeconomic consequences of and methods to reduce of teenage pregnancy in the developing world. The review finds variable results for all indicator types with the partial exception of knowledge-based indicators, which increased in response to almost all evaluating interventions, though it is not clear that such interventions necessarily lead to short- or long term-behavior change. The evidence base supporting the effectiveness of conditional cash transfers was relatively strong in comparison to other interventions. Similarly, programs that lowered barriers to attending school or increased the opportunity cost of school absence are also supported by the literature. On the basis of these findings, the authors argue that donors should adopt a rights-based approach to adolescent fertility and shift their focus from the proximate to distal causes of pregnancy, including human rights abuses, gender inequality, child marriage, and socioeconomic marginalization. Further research should be conducted to strengthen the evidence base by 1) establishing causality, 2) understanding the differential impacts of adolescent fertility in different contexts, and 3) investigating other the impact of adolescent fertility on other socioeconomic outcomes, such as labor participation, productivity, and the intergenerational transmission of poverty.
Topic:
Democratization, Demographics, Development, Economics, Foreign Aid, and Youth Culture

17039. Atrocity Prevention through Persuasion and Deterrence

Author:
Jonas Claes
Publication Date:
06-2012
Content Type:
Policy Brief
Institution:
United States Institute of Peace
Abstract:
Political missions can be described as multilateral teams of primarily civilian experts that rely largely on political persuasion to find a nonviolent way out of crises. Preventive deployments are defensive military missions primarily aimed at deterring state or non-state actors from initiating undesired actions. Both political missions and preventive deployments are traditionally seen as conflict management tools used by international or regional organizations.
Topic:
Conflict Prevention, Political Violence, Crime, Genocide, and Human Rights

17040. The PTI and Pakistan's Changing Political Landscape

Author:
Stephanie Flamenbaum
Publication Date:
05-2012
Content Type:
Policy Brief
Institution:
United States Institute of Peace
Abstract:
As the Pakistani electoral cycle gears up for an election, the country's traditional political stakeholders face a change in the tenor of political discourse and a more robust electoral field due to the recent rise in popular support for the Pakistan Tehreek-e-Insaf (PTI), or Pakistan Movement for Justice, helmed by cricketer-turned-politician Imran Khan.
Topic:
Democratization, Islam, and Politics
Political Geography:
Pakistan and South Asia