Economics & Global Affairs

The following is an event write-up about the recent Future of Diplomacy Project (FDP) seminar on “The Future of Ukraine: Reconstruction, Energy Security, and Innovation” moderated by Ambassador Paula J. Dobriansky, Senior Fellow with the Future of Diplomacy Project. 

For many, integrating “decarbonization” into public policy, corporate and financial strategies has become a requirement, not an option — yet, what happens when the critical link between climate stability and decarbonization breaks?

Capital Choices analyzes the creation of different SWFs from a comparative political economy perspective, arguing that different state-society structures at the sectoral level are the drivers for SWF variation. Juergen Braunstein focuses on the early formation period of SWFs, a critical but little understood area given the high levels of political sensitivity and lack of transparency that surround SWF creation. Braunstein’s novel analytical framework provides practical lessons for the business and finance organizations and policymakers of countries that have created, or are planning to create, SWFs.

With the looming threat of increased conflict in Ukraine, businesses around the world should be preparing now, write Paul R. Kolbe, Maria Robson Morrow, and Lauren Zabierek. Corporate security and intelligence teams have said they’re seeing an increase in cyber probes, and the U.S. Cybersecurity and Infrastructure Security Agency and the European Central Bank have both issued warnings about potential Russian cyberattacks. At this point, companies should be taking the following steps: 1) Review business continuity plans; 2) Closely examine supply chains; 3) Actively engage peer networks, vendors, and law enforcement around cyber intrusions; 4) Instill a security mindset in employees; and 5) Make sure corporate intelligence and IT teams are working closely together on solutions.

Audrye Wong provides an analysis of China's self-defeating economic statecraft.  She concludes that China's rapidly expanding overseas economic presence, particularly when accompanied by subversion and coercion, may exacerbate strategic fears across the globe.

As economies begin to orient themselves towards recovery and growth in a post-COVID-19 era, they will first need to disentangle themselves from their prior bedfellows, the state, whose courtship was necessary for survival during the pandemic.  Such bedfellow relationships have become increasingly common as government intervention is urgently needed for economic stabilization. Governments have also embraced their new role with vigor. According to the IMF, as of April 2020, countries have committed around $8 trillion to combat the pandemic and to remedy its ill effects on economies and societies. Decisions about how this money will be spent will undoubtedly recalibrate the logic of capitalism for years to come. 

Juergen Braunstein and Sachin Silva argue that sovereign wealth funds may be central to governments' efforts to balance public responsibility with private interests in post-pandemic economies.

The recent ruling of the German Constitutional Court on the ECB was an economic and political bombshell. The deep controversy that resulted – within Germany and on a European scale – illustrates that the ambiguity surrounding the euro area’s legal order and architecture may have reached its limit.

As the divergent experiences of the US and South Korea show, testing can be the difference between disease containment and catastrophe. Rather than relying on national governments to ensure the rapid development, production, and deployment of diagnostics during outbreaks, the world needs a global coordinating platform.