Category Archives: Globalization

Modelling the Country Risk of Zambia

Posted on by Assistant Editor

Journal of Political Risk, Vol. 10, No. 3, March 2022

Simon Muwando
University of Lusaka

Victor Gumbo
University of Botswana

Gelson Tembo
University of Zambia

Abstract

The world has experienced a dramatic increase in the flow of transnational investments following increased internationalization and globalization of firms in the previous decade. Country risk exposure is a cause for concern for all the institutions that are engaged in multinational trade and finance. The main objective of this study is modelling Zambia’s country risk. A mixed method with concurrent research design was employed. Personal interviews were the main instrument for collection of primary data and snowball sampling was used to select the interviewees. Secondary data was collected from the Lusaka Stock Exchange (LSE), Ministry of Finance, Bank of Zambia and Central Statistical Office. An autoregressive distributed lag technique was employed on annual data for the 1994 to 2018 period. This approach was chosen as it works best for small samples. The findings of the study revealed that the short run drivers for country risk of Zambia are beta, current account balance, political risk, unemployment rate and weighted short term interest rates. Current account balance was found to positively affect country risk while beta, political stability, and weighted short term interest rates negatively influence it.  The study findings established that the long run determinants of country risk of Zambia are current account balance, betas, political risk, and unemployment rate. From the study findings, current account balance positively influences country risk of Zambia whereas beta, and political stability negatively influence country risk of Zambia. The study concluded that the major determinant of country risk of Zambia in the short run and long run is current account balance as it has significant positive influence. Effective policies need to be implemented by authorities to manage or reduce persistent current account deficits and political risk, in order to manage country risk.

Continue reading →

Facebook Libra And Reliance Jio Compete With WeChat By Targeting The Unbanked

Posted on by admin

Journal of Political Risk, Vol. 8, No. 9, September 2020

Source: Tim Bennett, (Unsplash).

Vikram Chopra
CEO of Gift Jeenie

There’s a technology arms race developing between the West and China. At the frontier are emerging technologies such as 5G, Big Data, AI, Blockchain and Crypto. China already has an advantageous position in many of these areas, including 5G and AI, and is looking to challenge Bitcoin and the US dollar with its digital Yuan.

Facebook’s recent moves with Whatsapp and Libra are interesting strategies in this larger game of global tech domination where the likes of WeChat and TikTok have been resoundingly successful market leaders. A big reason for the success of WeChat is its complete market domination within China’s 1.4 billion population. Furthermore, Wechat has seamlessly integrated into the daily lives of its users. It’s more than just a chat application: it’s a platform for shopping, ordering groceries, booking travel, dry-cleaning, reserving a table at a preferred restaurant and sending money among other services. Add the 40 million global Chinese diaspora who use WeChat to communicate with loved ones back home, and you can see why WeChat is one of the leading social media networks with over 1.2 billion users globally. Continue reading →

The Recurring Intellectual Plague of Globalization

Posted on by admin

Journal of Political Risk, Vol. 8, No. 5, May 2020

A rear view of a businessman as he tries to sort out the mess of geopolitical events. Source: Pexels.

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

In the public mind, the outsourcing of jobs to China, which built the conveyer belt that carried Covid-19 from Wuhan to the world, was the fault of soulless transnational corporations. Greedy business tycoons were willing to deal with anyone in the pursuit of profit, regardless of larger consequences (of which the current pandemic is not the most dire). What cannot be overlooked, however, is that these private actors were given moral cover by intellectuals who assured them that they were fulfilling a higher purpose by spreading liberal values and promoting peace in a new era of globalization. Continue reading →

Canary In The Coal Mine: The US Navy’s Dilemmas As An Indication Of A Culminating Point In National Grand Strategy

Posted on by admin

Journal of Political Risk, Vol. 8, No. 4, April 2020


June 20, 2000 – The U.S.S. Abraham Lincoln Battle Group and ships from Australia, Chile, Japan, Canada, and Korea steam alongside one another for a Carrier Battle Group Photo during RIMPAC 2000. US Navy.

Captain Robert C. Rubel
USN (Ret)

From a resource point of view, the US Navy has not been doing well lately, its program to expand fleet size to 355 ships, a number that seems to be accepted by the Administration and Congress, has been suffering a series of setbacks.  Whether being raided for money to build a border wall, forced to fund the replacement ballistic missile submarine program or constricted due to the need to bolster current readiness, the Navy’s shipbuilding budget is under tremendous pressure, and Congress, despite a desire for a bigger fleet, has not increased the Navy’s top line sufficiently to accelerate ship construction.  Moreover, and perhaps worse, the Navy has been unable to produce a fleet structure assessment (FSA) that passes muster with the Secretary of Defense, who doubts the validity of a key assumption that underpins the study.[1]

Continue reading →