A broad set of institutions—from the World Trade Organization (WTO) to the World Bank and International Monetary Fund—underpin global trade and economic exchange. GTIPA-member reports in this category examine a variety of facets of international economic institutions, from WTO reform to the effect of regional development banks.
The election of Joe Biden as the next US President was celebrated with great acclaim within the international community.
With the US presidency about the change hands, many around the world wonder what changes the incoming Biden administration will bring to US foreign policy.
The solemn celebratory declarations at the occasion of the 75th anniversary of the UN may suggest otherwise but multilateral organizations have probably seen better days. Aside from the traditional problems – lacking efficiency, overblown bureaucracy, failure to impact bigger autocratic states – multilateral organizations are increasingly blocked due to fundamental disagreements among their membership.
The established order of things in international trade, the world we have been comfortable with for decades, has been shattered.
Dueling diplomatic trips in Europe this summer by United States Secretary of State Michael Pompeo and China’s Foreign Minister Wang Yi sought to sway the European Union’s stance on the China-U.S. rivalry. Among other goals, Pompeo would like to convince more countries to pledge not to use parts made by Huawei and ZTE in their 5G infrastructure—allegedly to limit the Chinese government’s ability to spy on communications there—while Wang hopes to keep the EU from shutting itself off from Chinese 5G companies.
On the eve of the first “in-person” European Council since the outbreak of th
The euro is the second most important global currency after the US dollar. However, its international role has not increased since its inception in 1999. The private sector prefers using the US dollar rather than the euro because the financial market for US dollar-denominated assets is larger and deeper; network externalities and inertia also play a role. Increasing the attractiveness of the euro outside the euro area requires, among others, a proactive role for the European Central Bank and completing the Banking Union and Capital Market Union.
In the United States, the Federal Reserve has engaged in loose monetary policy to suit President Donald Trump’s electoral needs and to soften the consequences of the lockdown – the interest rate on 10-year Treasury notes fell from 1.8 percent to less than 0.6 percent since the beginning of this year. At the end of June, it capped the dividends that big banks distribute to their shareholders and it prohibited buybacks.
French President Emmanuel Macron accused the “Frugals”, i.e. the Netherlands, Austria, Denmark, and Sweden (during the last European Council summit, Finland also joined this group) of “acting like Brexit Britain.” Dutch Prime Minister Mark Rutte had demanded a smaller proportion of grants – handing out money without having to repay it – instead of loans awarded by the EU Coronavirus Recovery Fund as well as oversight by the EU’s institutions over the use of funds.
As we enter an age of volatile geopolitics post-COVID-19, it is necessary to consider how the North Atlantic Treaty Organization (NATO) will adapt to deal with both growing uncertainty around US leadership and the rising threat of the Chinese regime.