Category Archives: Economics

Making Political Risk More Politically Relevant

Posted on by admin

Journal of Political Risk, Vol. 7, No. 12, December 2019

Ukraine’s Independence Square in Fall 2013, taken only months before it erupted into violent protests culminating in the overthrow of the sitting government. A busy commercial and tourist hub that day, there was no sign of the war zone it would soon resemble. Photo: Alicia Ellis.

Alicia N. Ellis, Ph.D.
Arizona State University

Executive Summary

This report assesses the state of the academic literature on political risk and evaluates its contribution to understanding and mitigating risk for both business and political professionals. This assessment concludes that policy-relevant research has been in some cases limited and, in most cases, ineffectively communicated. Several major problems contribute to the persistent disconnect between policy, industry, and academia. Political scientists do not approach their research questions in a communicable way, nor do they often take the necessary step of connecting their research to an end use. Risk rating organizations have become overly reliant on cross-national aggregate models. Mixed methods research has been applied inappropriately and thus, ineffectively. Systematic biases have been introduced to models at a structural level, and conceptual difficulties plague some of the most basic questions for risk analysts.

Despite these problems, opportunities do exist for bridging the gap between research and practice, and producing policy-relevant research. This article proposes some recommendations for moving forward. Research questions must be structured in new ways to reflect the needs of end consumers that include non-academic professionals. Several research agendas in need of a practical-minded researcher are put forth, including the rise of China and what it means for global trade patterns, the ‘buy local’ movement spreading across the United States, and the problem of democratic consolidation. For each problem identified, the article makes suggestions for how we might reframe the questions in a way that produces more useful research on political risk. Continue reading →

Beyond the Camps: Beijing’s Long-Term Scheme of Coercive Labor, Poverty Alleviation and Social Control in Xinjiang

Posted on by Adrian Zenz

Journal of Political Risk, Vol. 7, No. 12, December 2019

442 rural surplus laborers from Kashgar and Hotan, Xinjiang China, are sent off to work in an industrial park in Korla in a “centralized fashion”.

Adrian Zenz, Ph.D.
Senior Fellow in China Studies
Victims of Communism Memorial Foundation

1.0 Introduction

After recruiting a hundred or more thousand police forces, installing massive surveillance systems, and interning vast numbers of predominantly Turkic minority population members, many have been wondering about Beijing’s next step in its so-called “war on Terror” in Xinjiang. Since the second half of 2018, limited but apparently growing numbers of detainees have been released into different forms of forced labor. In this report it is argued based on government documents that the state’s long-term stability maintenance strategy in Xinjiang is predicated upon a perverse and extremely intrusive combination of forced or at least involuntary training and labor, intergenerational separation and social control over family units. Much of this is being implemented under the heading and guise of “poverty alleviation”.

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Forget Presidential Politics: Sri Lanka’s Green Movement Is Its Best Hope Against China

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Journal of Political Risk, Vol. 7, No. 11, November 2019

Construction at the site of a Chinese-funded 1.4 billion USD reclamation project in Colombo on December 5, 2017.
Half of the reclamation project to build Colombo Financial City, previously known as Colombo Port City, has been completed, with Sri Lanka hoping to turn it into an international financial centre with special laws protecting foreign investment. Source: Wikimedia Commons.

Bertie Harrison-Broninski
Editor of The Civil Society Review

Sri Lanka, like many countries in the Belt and Road Initiative (BRI), is not powerful enough to resist China on political or economic grounds – but hope lies in its burgeoning environmental movements.

This Saturday (November 16th), Sri Lankans go to the polls to elect a new president. The frontrunners are Sajith Premadasa, current Minister for Housing, Development, and Cultural affairs, and Gotabhaya Rajapaksa, the ruthless military leader who played a large part in defeating the ‘Tamil Tigers’ during Sri Lanka’s civil war. Both have family ties to ex-presidents: Premadasa’s father, Ranasinghe, was president 1989-1993, and Rajapaksa’s brother, Mahinda, was from 2005-2015.

International media has largely focused on the geopolitical implications of the Rajapaksas regaining power. Mahinda Rajapaksa is seen as a key player in initiating China’s current economic ‘debt trap’ over Sri Lanka, which has now led to 99-year leases on territory around Hambantota Port and Colombo, where China is constructing an entire ‘Port City’. A President Gotabhaya Rajapaksa would rightly be seen as a return to China-friendly Sri Lankan foreign policy after President Maithripala Sirisena’s more US-aligned years in office. Continue reading →

War In The Taiwan Strait Is Not Unthinkable: Some Will Lose More Than Others

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Journal of Political Risk, Vol. 7, No. 11, November 2019

Screen capture of Chinese state media video of People’s Liberation Army (PLA) troops training for an assault on Taiwan’s presidential office. Pictured is a mock building at the Zhurihe military base in China, that mimics the actual building in Taipei. The video aired July 5, 2015. CCTV via Apple Daily.

Grant Newsham
US Marine Officer (Ret)

Whether anyone actually ‘wins’ a war is a philosophical debate.  The Germans and Japanese in 1945 might have thought wars do indeed have winners.  But perhaps it’s better said that in most conflicts some parties ‘lose more than others.’

Such would be the case if Beijing attempted to militarily subjugate Taiwan.  And Xi Jinping just might do so.  He declared in a January 2019 speech that “we (China) do not promise to renounce the use of force and reserve the option to use all necessary measures (to take Taiwan.)”[1]

The Battle for Taiwan would have truly global consequences, akin to the invasion of Poland by the Soviets and Germans in 1939.

However, much of the debate over a Taiwan Strait conflict focuses on preparation for and conduct of the PRC’s attack: whether Beijing will or won’t attack, what an attack might look like and Taiwan’s ability to defend itself, whether the US will or should get involved and whether it ought to sell Taiwan ‘this or that’ weapon.  Such discussion is useful, but the actual consequences and longer-term ripple effects of a fight over Taiwan deserve much more attention.[2]

This paper examines key aspects of what happens once the shooting starts, and the follow-on global economic and political effects.  The envisioned scenario is a full-scale PLA assault against Taiwan, but it’s worth noting that even a ‘limited’ assault–such as against one of Taiwan’s offshore islands–may not stay limited for very long: given Beijing’s oft-stated determination to take all of Taiwan, an off-shore island assault would only constitute a tactical objective in the march on Taipei, and would also have serious and wide-ranging political and economic consequences.

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China and the War of Shipyards and Factories

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Journal of Political Risk, Vol. 7, No. 10, October 2019

Chinese aircraft carrier group, including J-15 fighters and helicopters, trains in the South China Sea in late December, 2016. NARA & DVIDS Public Domain Archives.

William R. Hawkins
Former U.S. House Foreign Affairs Committee member

Satellite images show that China is making rapid progress in building its new Type 02 aircraft carrier at the Jiangnan Shipyard in Shanghai. The Type 02 is a larger design than Beijing’s first two carriers which were based on Soviet-era light carriers of about 67,000 tons and which lacked catapults for launching first-rate fighters. They used “ski jumps” to put planes into the air, limiting them to the small, short-range J-15 “Flying Shark” fighter-bombers. The Russian-built/China modified Type 01 can only carry 24 of these warbirds, though the China-built 01A, which is about to deploy, may be able to carry a few more. The Type 02 is a much larger design more in line with American carriers. At an estimated 80,000+ tons, it will be able to carry 40+ fighters as well as supporting aircraft such as early warning and control planes. In comparison, the typical U.S. Navy carrier has 60+ fighters along with other support aircraft. They are also nuclear-powered which the Chinese carriers are not. This does not mean, however, that American naval-air superiority is assured. Continue reading →