Coronavirus - Atlantic Council https://www.atlanticcouncil.org/issue/coronavirus/ Shaping the global future together Mon, 01 Jul 2024 16:05:44 +0000 en-US hourly 1 https://wordpress.org/?v=6.5.5 https://www.atlanticcouncil.org/wp-content/uploads/2019/09/favicon-150x150.png Coronavirus - Atlantic Council https://www.atlanticcouncil.org/issue/coronavirus/ 32 32 Roberts quoted in South China Morning Post on China’s visa restrictions https://www.atlanticcouncil.org/insight-impact/in-the-news/roberts-quoted-in-south-china-morning-post-on-chinas-visa-restrictions/ Wed, 12 Jun 2024 20:14:31 +0000 https://www.atlanticcouncil.org/?p=773821 On June 11, IPSI/GCH nonresident senior fellow Dexter Tiff Roberts was quoted in a South China Morning Post article regarding China’s relaxation of visa restrictions, which has attracted tourists back to the country following its COVID-19 lockdown. 

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On June 11, IPSI/GCH nonresident senior fellow Dexter Tiff Roberts was quoted in a South China Morning Post article regarding China’s relaxation of visa restrictions, which has attracted tourists back to the country following its COVID-19 lockdown. 

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Advancing health and resilience policies in Latin America and the Caribbean https://www.atlanticcouncil.org/in-depth-research-reports/report/advancing-health-and-resilience-policies-in-latin-america-and-the-caribbean/ Tue, 16 Apr 2024 23:35:30 +0000 https://www.atlanticcouncil.org/?p=754527 During an off-the-record private roundtable, thought leaders and practitioners from across the Americas discussed how to further enhance access to and finance for health services and products in the region.

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The fourth of a six-part series following up on the IX Summit of the Americas commitments.

A report by the Adrienne Arsht Latin America Center in partnership with the US Department of State. This readout was informed by multi-stakeholder dialogues focused on facilitating greater, constructive exchange among multi-sectoral thought leaders and government leaders as they work to implement Summit commitments.

Executive summary

During the Ninth Summit of the Americas, member states made a historic political pledge by committing to the Action Plan on Health and Resilience, which aims to strengthen access to and investment in health services and products in the Americas. As experts and practitioners deliberated on transforming this commitment into reality, they emphasized the crucial need for consistent multisectoral coordination on both new and existing initiatives. They also stressed the importance of addressing equity issues in the implementation efforts, with special emphasis on traditionally vulnerable groups whose healthcare access was affected most by COVID-19: children with disabilities, people with autism, and the elderly. They emphasized the need to develop accountability mechanisms ensuring that national health plans transcend political shifts and provide sustained access to financing to secure their sustainability and resilience. As human mobility across the Americas continues to grow, enhancing intraregional cooperation on technology and digital infrastructure for data and information sharing will be key to addressing climate-related illnesses and other shared health challenges.

Recommendations for advancing the implementation of durable health systems in the Americas:

  1. Enhance multisectoral coordination to streamline investment in existing initiatives and commitments.
  • Leverage the Americas RISE for Health platform and other existing platforms to enhance collaboration and coordination among stakeholders, ensuring active participation and coordination among academia, civil society, the private sector, multilateral banks, and regional organizations such as the Pan American Health Organization (PAHO).1
  • Lead the organization of biannual regional forums with member states to facilitate knowledge sharing and best practices for the implementation of the goals outlined in the Health Action Plan until 2030.2
  • Consider incorporating the Action Plan on Health and Resilience into member states’ broader commitments such as the Americas Partnership for Economic Prosperity (APEP), Alliance for Development in Democracy (ADD), Asia-Pacific Economic Cooperation Forum (APEC), and other intraregional cooperation mechanisms and/or pledges that could play an important role in developing the necessary workforce and supply-chain resilience needed for sustainable health systems.3
  • Promote further collaboration between the private and public sectors to develop effective communication channels for better alignment with ongoing initiatives, ensuring a coordinated effort to identify and address specific areas where private-sector support is needed and to avoid duplication of programs and efforts.4
  • Promote regulatory-harmonization best practices across the region to facilitate access to telemedicine and other digital solutions to health problems between countries.
  1. Enhance equitable and universal access to health services and products with a special emphasis on access to innovation and technology.
  • Identify, address, and prevent barriers to health access in the Americas by finding innovative solutions that adapt to the lives of people in the region. Consider levels of informality, geographical location, workday hours, child and elderly care, public-transportation hours, security threats, and/or other factors that might be preventing access to health care.5
  • Develop a targeted strategy to improve the presence and sustainable operation of healthcare workers in remote areas, where most of the populations are marginalized.6
  • Promote targeted investment in health and digital infrastructure in remote areas of the Americas with little to no connectivity. This will facilitate affordability and access to digital health, taking one step further to promote primary-care access for all.
  • Develop a plan to mitigate the high cost of innovative health technology, such as artificial intelligence, robotics, digital tools, and other research and development tools. Ensure that middle- and low-income countries can adequately finance these tools without raising healthcare costs for the population or weakening intellectual-property (IP) protective legislation or violating IP rights.
  1. Consider the importance of sustained institutional capacity and proper country leadership to ensure consistent implementation efforts.
  • Empower civil-society organizations (CSOs) to play an active role in auditing and monitoring the implementation of national and local health initiatives through open engagement with governments. This will ensure accountability in the implementation of the Action Plan and other health-related commitments.7
  • Explore opportunities to integrate health initiatives into broader economic strategies, emphasizing the interconnectedness of health and a country’s economic performance. Collaborate with local and international stakeholders to align health policies with sustainable economic-development goals.8
  • Advocate for countries to prioritize sustained financing for health systems, recognizing this as an investment in long-term public-health resilience. Develop mechanisms to ensure that health budgets are protected and sustained despite economic fluctuations and differing political interests.9
  • Address challenges around in-country institutional capacities, including leadership development, strategic planning, and regulatory frameworks aligned with international standards that ensure access to safe and effective therapies. Prioritize investments in training and capacity building to ensure that institutions are equipped to handle evolving health challenges.10

Related content

Report

Nov 8, 2023

Future of the Cities Summit of the Americas

By Willow Fortunoff, Diego Area

The first-ever Cities Summit of the Americas created a new platform for mayors across the hemisphere to build partnerships with civil society organizations–particularly those focused on the region and/or local governance–private sector companies, and one another.

Civil Society Energy Markets & Governance

Summit of the Americas

Amid global uncertainties and new challenges, the ninth Summit of the Americas is a renewed opportunity to bring about hemispheric cooperation and consensus to reach regional prosperity and security.

Public events



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The Adrienne Arsht Latin America Center broadens understanding of regional transformations and delivers constructive, results-oriented solutions to inform how the public and private sectors can advance hemispheric prosperity.

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A warming world could unleash dangerous new pathogens. Metagenomics early warning tools are vital for pandemic prevention. https://www.atlanticcouncil.org/blogs/new-atlanticist/a-warming-world-could-unleash-dangerous-new-pathogens-metagenomics-early-warning-tools-are-vital-for-pandemic-prevention/ Mon, 30 Oct 2023 12:36:03 +0000 https://www.atlanticcouncil.org/?p=694038 There is a need for policies that enable mainstream adoption and equitable scale-up of new genomic sequencing technologies capable of rapid and comprehensive surveillance of emerging biological threats. 

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The world is experiencing a rapid rise in average global temperatures and climate change is increasingly recognized as a health security threat multiplier. Climate-induced changes in land use and global ecosystems are increasing the risk of emergence of novel zoonotic pathogens that can spill over from animals to humans. In the Arctic, global warming is causing the thawing of permafrost reported to be releasing biogeochemical hazards such as viruses, bacteria, anthropogenic chemicals, and nuclear wastes into the environment. Globalization also increases the risk that “time-traveling pathogens” stored for thousands of years in permafrost could potentially survive, spread to other regions of the world, and evolve over time. 

Amid these cascading global risk drivers, there is a need for policies that enable mainstream adoption and equitable scale-up of next-generation sequencing (NGS, or NextGen sequencing) technologies capable of rapid and comprehensive surveillance of emerging and reemerging biological threats. NGS technologies aid in the earlier identification and tracking of infectious disease pathogens by collecting samples containing pathogen genetic material from different sources and aggregating this data to make a microbial diagnosis. These technologies also provide valuable surveillance insights into the characteristics of the outbreak-causing pathogens, including disease transmission patterns and the presence of antimicrobial resistant (AMR) genes. Notably, metagenomics “shotgun” NGS technology can more quickly detect a diversity of known and unknown pathogens within a genetic sample simultaneously to better inform public health action. However, a lack of policies to ensure investments in its cost-effective scale-up and integration with traditional epidemiologic surveillance systems are hindering the widespread adoption of this critically important technology as an early warning tool for biological threat detection.

Learning the right lesson from COVID-19

Potentially catastrophic biological events, such as emerging and reemerging pathogens from permafrost thaw and with spillover potential, are often viewed as falling within the realm of science fiction. However, the emergence of SARS-CoV-2 (the coronavirus causing COVID-19) made clear that low-probability, high-consequence events, such as an outbreak of a pandemic-causing novel zoonotic virus, are increasing in likelihood and, thus, not confined to Hollywood screenwriting.

A major lesson emerging from the COVID-19 pandemic is the need for stronger partnerships on strengthening the global architecture to enable routine adoption of NextGen sequencing technologies for early detection of emerging pathogens and the utilization of sequencing data to rapidly initiate risk mitigation activities. During the pandemic, there was an increase in the use of “omics” technology to identify different strains of SARS-CoV-2 in circulation. This advanced pathogen surveillance and characterization method was highly instrumental in providing an effective response to the pandemic, including for developing targeted COVID-19 vaccines. In the United States, genomics sequencing combined with wastewater surveillance data was successfully used to keep track of new strains of SARS-CoV-2 and to provide an early warning about other pathogen types, including AMR pathogens, circulating in a community.

The early identification of the Omicron variant of SARS-CoV-2 by researchers in South Africa and Botswana in November 2021 highlighted the advanced genomics capacities in place in some countries in Africa, as part of the Africa Centres for Disease Control and Prevention Pathogen Genomics Initiative (PGI). In real-time, researchers from the region took appropriate measures to share sequenced data with the rest of the world as an early warning about the emergence of a new variant of the virus. The “rewards” of such proactivity, however, were travel bans and other punitive measures adopted by many countries, including the United States, to the detriment of southern African countries. This unfortunate turn of events highlights the need to strengthen policies to enable better cooperation of countries around rapid sharing of pathogen genomics data in real time and near real time as new pathogens emerge to better inform data-driven decision-making for pandemic prevention, preparedness, and response (PPPR).

Technology solutions

To ensure the effective monitoring and early detection of biological threats such as emerging AMR pathogens with the potential to spread across geographic regions, there is a need for mainstream adoption of a high throughput sequencing platform that can provide detailed genetic information about pathogens more rapidly and in the most cost-efficient manner. Amid the warming of the Arctic, there are ongoing research studies into the genomic diversity of permafrost pathogens using metagenomics sequencing. This pathogen-agnostic approach to pathogen surveillance enables the rapid identification of multiple pathogen types in a genetic sample and prediction of resistance emergence to inform public health decision making, policy formulation, and the implementation of appropriate biothreat risk mitigation interventions.

At present, metagenomics sequencing technology is yet to be routinely adopted and integrated into national surveillance systems such as the National Antimicrobial Resistance Monitoring System (NARMS). This problem may be due to the complex workflow protocols and computationally demanding procedures that drive up implementation costs, thus making the current approach to metagenomics sequencing hard to scale as a nationwide strategy for routine AMR pathogen surveillance and early detection of emerging pathogens. Identifying the problem provides an opportunity to also inform the development of policy solutions focused on reducing costs.

One cost-cutting approach is to implement a standardized process and automated workflow protocol for routinely collecting, sequencing, analyzing, and integrating metagenomics sequenced data and ensuring harmonization/integration of data with the NARMS and other epidemiologic surveillance systems. Similarly, adopting a portable metagenomics sequencing platform will help reduce the time and corresponding costs of metagenomics data synthesis and reporting by simplifying the workflow process and reducing the turnaround time of sequenced data results. Existing portable sequencing platforms that have been validated and may be adopted for real-time analysis of metagenomics sequencing data include Oxford Nanopore’s MinION and iGenomics app.

Scaling up metagenomics sequencing

Enhancing pathogen genomic surveillance capacities for informing public health action would require equitable scale-up of metagenomics sequencing nationally, regionally, and globally and having in place the right policies to enable its effective implementation across health systems. At the national level, there is a need to harmonize and ensure interoperability of metagenomics-enabled surveillance data with other existing data systems using a One Health approach. This approach would also require enhancing capacities of countries in environmental surveillance and climate forecasting. In the United States, the White House has put forward a new executive order on enhancing the biotechnology and biomanufacturing sector, in close partnership with other countries, and pledges to invest eighty-eight billion dollars in PPPR activities over a five-year period.

In line with efforts to leverage emerging technologies, the newly launched US Office of Pandemic Preparedness and Response Policy should prioritize policies that enable widespread use of metagenomics sequencing for early detection of biological threats including AMR pathogens. It will be important to ensure these policies align with the Pioneering Antimicrobial Subscriptions to End Upsurging Resistance (PASTEUR) Act reintroduced to the Senate in April 2023. The PASTEUR Act aims to address existing gaps in antimicrobial development by incentivizing private sector providers to discover and develop new antimicrobials and to increase public health preparedness. Improving the utility and scale-up of metagenomics sequencing for early warning of emerging biological threats and for resistant pathogen monitoring would help ensure the availability of more sensitive data to promote innovations for the development of novel broad spectrum antimicrobial drugs to fight the silent pandemic of AMR. Similarly, the recently proposed Emerging Pathogens Preparedness Program under the US Food and Drug Administration could help promote regulatory reforms needed to speed up the development of medical countermeasures.

As the Africa Centres for Disease Control and Prevention progresses with strengthening the capacities of all fifty-five African Union member countries in metagenomics-enabled microbial surveillance via the PGI, there is also an opportunity to enhance coalitions with the United States on PPPR to ensure better preparedness for the next biological threat that may potentially emerge from the Artic and other “hotspot” regions. In addition to existing partnerships across technical institutions, new coalition building opportunities should be explored with agencies such as the newly formed Bureau of Global Health Security and Diplomacy under the US Department of State, to set joint standards to enable the use of metagenomics sequencing more effectively for biological threat detection. Enhancing and scaling up pathogen genomics surveillance capacities across geographic regions also requires identifying opportunities for public-private sector partnerships, such as existing partnerships with Illumina, Inc. on the PGI; and the collaborative efforts of the Gates Foundation and Chan Zuckerberg Biohub initiative established during the COVID-19 pandemic.

Globally, a way to ensure harmonized standards setting and interoperability of genomics data across geographic regions is to align national and regional policies with global frameworks such as the World Health Organization (WHO) Global Genomic Surveillance Strategy for Pathogens with Pandemic and Epidemic Potential. The WHO Strategy aims to achieve a set target of ensuring access to timely and reliable genomic sequencing data for identified pathogens with epidemic and pandemic potential by 2032.

“Canary in the coal mine”

The ongoing thawing permafrost in the Arctic is just one of many ecosystem changes caused by climate change. This process of permafrost degradation and subsequent discoveries of emerging pathogens, such as resistant pathogen strains with the potential to spread to other regions, serve as a “canary in the coal mine” signaling the imminent risk of occurrence of a global catastrophic biological event, if left unaddressed.

Although there are no easy solutions to addressing the global climate crisis and its impact on infectious disease pathogen emergence and reemergence, there is a need to move away from the approach of adopting quick fixes in a fragmented and uncoordinated manner. It is also well-acknowledged that calling attention to the increasing global health security threat posed by climate change driven invisible “superbugs” is not as attention-grabbing as the threat of extinction of “charismatic megafaunas” driving many ecosystem conservation efforts. Nevertheless, there remains an urgent need to link PPPR initiatives to climate action goals of reducing carbon emissions to help reverse global warming and stop further degradation of the Arctic. Such initiatives might include adopting national and global policies that enable partnership building and investments in emerging technologies including metagenomics “shotgun” NextGen sequencing for environmental monitoring and early detection of emerging and reemerging pathogens. This sequencing approach could inform the development of antimicrobials and other medical countermeasures as a critical aspect of biological risk mitigation.

Robust policy solutions are required to enable the cost-efficient scale-up and interoperability of metagenomics sequencing data platforms with other complementary pathogen monitoring systems using a One Health approach. There is also a need to strengthen international cooperation on pathogen genomics surveillance. Such cooperation can be strengthened via the harmonization of data sharing platforms and adoption of joint policy frameworks to improve early warning and detection of environmentally driven emerging biological threats and looming threats such as Disease X, a term used to indicate an unknown pathogen with the potential to infect humans.

The gathering of various interest groups, including policymakers, international organizations, multisectoral experts, technology providers, and industry players at the upcoming United Nations Climate Change Conference, known as COP28, provides the right convening platform to strengthen existing partnerships and form new coalitions as a call to action during the COP28 Health Day and Climate-Health Ministerial. In advance of future global gatherings, ensuring an effective response to this clarion call requires setting data-driven, cross-sectoral policy agendas and implementing measurable joint action plans to track progress with achieving health security and climate change goals with known ancillary benefits across all relevant sectors.


Oluwayemisi (Yemisi) Ajumobi is a resident senior fellow at the Atlantic Council’s GeoTech Center who focuses on the adoption of NextGen sequencing technologies to enhance global health security.

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Shalomov and Pelayo in the Jerusalem Post https://www.atlanticcouncil.org/insight-impact/in-the-news/shalomov-and-pelayo-in-the-jerusalem-post/ Thu, 27 Apr 2023 14:53:26 +0000 https://www.atlanticcouncil.org/?p=640275 The post Shalomov and Pelayo in the Jerusalem Post appeared first on Atlantic Council.

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Aviso LatAm: February 18, 2023 https://www.atlanticcouncil.org/content-series/aviso-latam-covid-19/aviso-latam-february-18-2023/ Sat, 18 Feb 2023 13:27:31 +0000 https://www.atlanticcouncil.org/?p=613646 For the first time in nearly three years, Brazil registered zero pandemic-related deaths in a day

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​​​​​What you should know

  • Nicaragua: On February 9, the Ortega-Murillo regime released and expelled 222 political leaders, priests, students, and other dissidents to the United States.
  • US-Brazil relations: Presidents Biden and Lula da Silva met on February 10, during which they underscored the importance of strengthening democracy, promoting respect for human rights, and addressing the climate crisis.
  • Ecuador: Ecuadorians rejected all eight items on a constitutional referendum backed by President Lasso, signaling anti-incumbent sentiments and the clout of pro-Correísmo opposition political forces.

Monitoring economic headwinds and tailwinds in the region

  • Argentina: Annual inflation reached 98.8 percent, while activities in the construction and manufacturing sectors continued to decline.  
  • Brazil: The government met with Mexico, Germany, Colombia, Chile, the World Bank, and the Inter-American Development Bank (IDB) to explore issuing green bonds this year. 
  • Belize: The government launched two new projects in cooperation with Taiwan, a business support program focused on women and micro, small, medium-sized enterprises (MSMEs), and a flood warning system for disaster prevention.  
  • Colombia: 2022 GDP growth is estimated to be 7.9 percent, down from 2021’s 10.8 percent growth. In 2023, growth is expected to further decline to 1.05 percent. 
  • Peru: Continuing protests and supply shortages have led several mines to suspend or reduce operations, threatening copper production.  
  • Suriname: President Santokhi expressed willingness to collaborate with neighboring Guyana on oil and gas exploration and development to position the Caribbean as an energy hub. 

In focus: Inflation and infighting

As regional inflation continues, political pressures are leading to criticism of central bank policy in Brazil and Colombia. Recently-elected presidents Lula and Petro have both questioned rate hikes as a method to tackle inflation, suggesting more flexible targets and alternative policies. The governor of Colombia’s Central Bank, Leonardo Villar, expects the region to require continuing tight monetary policy, which critics argue may complicate other policy goals such as growth. Roberto Campos Neto, president of the Central Bank of Brazil, has expressed his willingness to coordinate with the Lula administration to achieve growth and control inflation. 

Despite the public clashes, central bank policy in both countries remains independent. In Brazil, a 2021 law protects central bank autonomy and is unlikely to be repealed. In Colombia, the central bank has maintained a course independent of presidential advice for two decades. 

Health + Innovation

  • Colombia: President Petro presented a health reform to Congress that seeks to improve primary care, expand access to treatment, raise healthcare worker salaries, and fight corruption by eliminating private sector management of payments.
  • Brazil: Nearly three years since COVID-19 claimed the life of its first victim, the country has for the first time registered zero pandemic-related deaths in a day on February 12.
  • Jamaica: The Bureau of Standards launched the Jamaican Standard Specification for Telemedicine, which provides the framework through which telemedicine may be safely practiced while upholding the integrity of the medical profession.

Geopolitics of vaccine donations: US vs. China

  • The United States outpaces China in its donations of COVID-19 vaccines to Latin America and the Caribbean, with Colombia and Mexico topping the list. The region has received roughly 52 percent of all US COVID-19 vaccine donations. To learn more, visit our COVID-19 vaccine tracker: Latin America and the Caribbean.

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Metzl on Fox News discussing the need to investigate the origins of COVID https://www.atlanticcouncil.org/insight-impact/in-the-news/metzl-on-fox-news-discussing-the-need-to-investigate-the-origins-of-covid/ Thu, 16 Feb 2023 17:04:35 +0000 https://www.atlanticcouncil.org/?p=612863 On February 10, Scowcroft Strategy Initiative Nonresident Senior Fellow Jamie Metzl appeared on Fox News to discuss the need for a bipartisan 9/11-style commission investigating the origins of the COVID-19 virus. He asserts that the noncompliance of the Chinese governments is cause for worry, and further investigation is the best means to prepare for - or even stop - a future pandemic. Metzl stresses that this is a bipartisan issue that has seen agreement and consensus among members of both sides of the aisle. He also notes the lack of transparency on the part of the NIH in the work they were minimally funding in the Wuhan Institute of Virology.

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original source

On February 10, Scowcroft Strategy Initiative Nonresident Senior Fellow Jamie Metzl appeared on Fox News to discuss the need for a bipartisan 9/11-style commission investigating the origins of the COVID-19 virus. He asserts that the noncompliance of the Chinese government is cause for worry, and further investigation is the best means to prepare for – or even stop – a future pandemic. Metzl stresses that this is a bipartisan issue that has seen agreement and consensus among members of both sides of the aisle. He also notes the lack of transparency on the part of the NIH in the work they were minimally funding in the Wuhan Institute of Virology.

We still don’t have the kind of comprehensive investigation into pandemic origins that we need. Congress needs to push it. Certainly, the biggest challenge is the Chinese government, which is doing everything possible to prevent an investigation, but that doesn’t mean we should just throw up our hands… If we don’t learn the lessons of this one, we’ll be facing something much worse in the future.

Jamie Metzl

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Aviso LatAm: February 6, 2023 https://www.atlanticcouncil.org/content-series/aviso-latam-covid-19/aviso-latam-february-6-2023/ Mon, 06 Feb 2023 14:28:37 +0000 https://www.atlanticcouncil.org/?p=609106 Dr, Jarbas Barbosa takes office as PAHO's new director

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​​​​​What you should know

  • PAHO: Dr. Jarbas Barbosa took office on February 1 as the health organization’s new director, pledging to work in partnership with member states to end the pandemic and ensure that the region’s health systems recover stronger than before.
  • IMF: The organization raised its global growth forecast to 2.9 percent, up from its original 2.7 percent. The outlook is also better for the region’s two major economies: up 0.2 percent for Brazil, to 1.2 percent, and a half point for Mexico, to 1.7 percent.
  • Migration: The 250,000 migrants that irregularly crossed into Panama through the Darien Gap in 2022 represents a record high that is nearly double the 133,000 entries recorded in 2021.

Monitoring economic headwinds and tailwinds in the region

  • Mexico: The national statistics agency reported that the economy grew 0.4 percent in Q4 of 2022 compared to the previous quarter.
  • Argentina: The government will leverage new gas exports to Chile, and potentially Brazil, to improve its trade balance and pay down debt.  
  • Brazil: Alongside Argentina, the government is floating the development of a common currency linking the two countries to facilitate trade. 
  • Colombia: The Minister of Mines and Energy Irene Velez announced at Davos that the country will no longer approve new oil and gas exploration contracts.
  • Jamaica: Third-quarter GDP grew by 5.9 percent over 2022 due to a resurgent tourism sector, which has boosted hotels, restaurants, and services, among other sectors.  
  • Peru: Ongoing protests and road blockades have cost the country $550 million since the ousting of President Pedro Castillo last December. 
  • Transatlantic ties: German Chancellor Olaf Scholz visited Argentina, Brazil, and Chile, to discuss the EU-Mercosur trade agreement and support for Ukraine. 

In focus: Energy expansion in Trinidad and Tobago

On January 24, the United States licensed Trinidad and Tobago to develop a natural gas project off the coast of Venezuela in the Dragon field region. The project will support overall Caribbean energy security, with a requirement that some of the produced gas must be exported to Jamaica and the Dominican Republic. To comply with US sanctions, Trinidad will pay for the gas with humanitarian aid. 

Atlantic Council experts reacted immediately, emphasizing the importance of this move towards meeting Caribbean energy demand. You can read more here

 

Health + Innovation

  • Haiti: As of January 17, the Ministry of Public Health and Population has reported over 24,400 suspected cholera cases.
  • Education: A World Bank study shows that by 2045, nearly 5 million people across LAC would fall into poverty due to pandemic-induced learning losses.
  • Brazil: The Health Ministry announced that it will roll out bivalent COVID-19 booster shots as early as February 27.

Geopolitics of vaccine donations: US vs. China

  • The United States outpaces China in its donations of COVID-19 vaccines to Latin America and the Caribbean, with Colombia and Mexico topping the list. The region has received roughly 52 percent of all US COVID-19 vaccine donations. To learn more, visit our COVID-19 vaccine tracker: Latin America and the Caribbean.

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Russian War Report: Satellite imagery indicates a build-up of air defense missile systems in southern Russia https://www.atlanticcouncil.org/blogs/new-atlanticist/russian-war-report-satellite-imagery-indicates-a-build-up-of-air-defense-missile-systems-in-southern-russia/ Fri, 03 Feb 2023 16:45:11 +0000 https://www.atlanticcouncil.org/?p=608353 Satellite imagery suggests the build-up of air defense missile systems in southern Russia while Ukraine warns of a potential spring Russian offensive.

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As Russia continues its assault on Ukraine, the Atlantic Council’s Digital Forensic Research Lab (DFRLab) is keeping a close eye on Russia’s movements across the military, cyber, and information domains. With more than seven years of experience monitoring the situation in Ukraine—as well as Russia’s use of propaganda and disinformation to undermine the United States, NATO, and the European Union—the DFRLab’s global team presents the latest installment of the Russian War Report. 

Security

Satellite imagery indicates a build-up of air defense missile systems in southern Russia

Ukraine defense minister warns of new Russian offensive

New Russian fortifications indicate a spring offensive could be on the horizon

Tracking narratives

Russia alleges US bioweapons created COVID, targets Ukrainians

Pro-Russia Telegram channels target Israel following Iran strike

Italy targeted by Russian accusations as Rome prepares new weapons package for Ukraine

Satellite imagery indicates a build-up of air defense missile systems in southern Russia

Satellite imagery reviewed by the DFRLab suggests a new build-up of air defense missile systems in Russia’s southern military region between Rostov-on-Don and Krasnodar. The DFRLab used radar imagery forensics to detect and approximate the relocation of air defense systems near the Azov Sea. As noted by University College London Professor Ollie Ballinger, missile batteries tend to cast recognizable turbulence signals on radar imagery when their systems are activated. This phenomenon has also been documented in the Middle East and the Baltic Sea.

The Sentinel-1 satellite of the European Space Agency collects satellite imagery using radar technology. As military systems also use radar electromagnetic wavelengths in the 5gHz range, referred to as the C-Band in NATO nomenclature, these are exploitable as open-source evidence for military activity and weapons deployment.

Radar imagery, captured between January 25 and January 30, 2023, shows air defense system interference patterns. Source: DFRLab via Sentinel-1 on 5Ghz Interference Locator via Google Earth Engine)
Radar imagery, captured between January 25 and January 30, 2023, shows air defense system interference patterns. Source: DFRLab via Sentinel-1 on 5Ghz Interference Locator via Google Earth Engine)

The DFRLab monitored for deployments of such systems near a field south of Oktyabrskaya in Russia’s Krasnodar Oblast. These systems were likely located close to a military airbase. While the DFRLab cannot confirm their presence in this area nor identify the exact systems, other interference signal patterns along the eastern border of Luhansk and Donetsk could also be interpreted as evidence of more electromagnetic radar-casting defense systems.

Valentin Châtelet, Research Associate, Brussels, Belgium

Ruslan Trad, Resident Fellow for Security Research, Sofia, Bulgaria

Ukraine defense minister warns of new Russian offensive

Ukrainian Defense Minister Oleksii Reznikov warned that Russia might attempt to launch a new offensive before the first anniversary of the Ukraine invasion on February 24. According to Reznikov, Russia is concentrating as many as 500,000 troops along Ukraine’s borders, significantly exceeding the declared 300,000 soldiers. Reznikov speculated that the offensive could come from the east and the south simultaneously. The minister also emphasized that military assistance from allies is needed to repel a possible attack.

Ukrainian military intelligence also stated that Ukraine expects a new wave of fighting in the next two months. Meanwhile, Russian President Vladimir Putin held a meeting to discuss the restoration of infrastructure in Crimea, Belgorod, Bryansk, and Kursk following Ukrainian shelling. He noted that his administration is prioritizing ending Ukrainian shelling along border regions.

On the evening of February 1, Russian forces struck the center of Kramatorsk with a rocket. Three civilians were killed and more than 20 people were injured. At least eight apartments were damaged, with one destroyed. 

Meanwhile, Russian offensive operations have restarted in various locations. In the direction of Kupiansk, the Russian army shelled Dvorichna, Synkivka, Ivanivka, Kyslivka, Kotlyarivka, Tabayivka, Pischane, Novoselivske, and Stelmakhivka. The Russian army continued to attack villages and pressed Ukraine’s army positions toward Lyman, Zaporizhzhia, Kherson, Vuhledar, Avdiivka, and Bakhmut.

Valentin Châtelet, Research Associate, Brussels, Belgium

Ruslan Trad, Resident Fellow for Security Research, Sofia, Bulgaria

New Russian fortifications indicate a spring offensive could be on the horizon

Russian armed forces have dug trenches in Zaporizhzhia and Kherson Oblasts that the DFRLab has reviewed extensively on social media and satellite imagery. The southern flank in the Russian-occupied Zaporizhzhia Oblast has seen a rise in the build-up of trenches and fortifications stretching from Polohy to Vesele. The DFRLab identified massive underground structures in three different locations, pointing at a Russian reinforcement in their southern positions.

On January 27, trenches stretching twenty-one kilometers and circling Berdyansk’s airport tipped off OSINT researchers to Russia’s expected escalation on the southern flank. The DFRLab identified and documented two other occurrences of defensive build-ups on the eastern bank of the Dnipro River.

Between mid-December and January 31, 2023, Russian soldiers dug up underground trenches in an odd-B shape in the vicinity of Vesele, a village forty kilometers northeast of Melitopol. The DFRLab identified two structures, along with other fortifications across neighboring fields north of Vesele. The other structure, located west of the underground trenches, seems to resemble a defense base immediately connected to the village by a road.

Satellite imagery captured on January 27, 2023, shows new fortifications and trenches north of Vesele. Source: DFRLab via Planet.com
Satellite imagery captured on January 27, 2023, shows new fortifications and trenches north of Vesele. Source: DFRLab via Planet.com

In Mykhailivka, a city facing Zaporizhzhia from the other side of the riverbank, the DFRLab located similar trenches and fortifications. These stretch up to fifteen kilometers long, protecting the entire city near the front line.

Valentin Châtelet, Research Associate, Brussels, Belgium

Ruslan Trad, Resident Fellow for Security Research, Sofia, Bulgaria

Russia alleges US bioweapons created COVID, targets Ukrainians

On January 30, Russia’s Ministry of Defense published a collection of conspiracy narratives alleging the United States operates a biological weapons program. The ministry published the initial text on the free and anonymous blogging platform telegra.ph, developed by Telegram for sharing long-form posts. 

The post begins with allegations that the US is involved in the emergence and spread of COVID-19. It names various US agencies and Microsoft founder Bill Gates as key actors in the pandemic. The ministry claims to have acquired more than “20,000 documents, reference and analytical materials, as well as surveyed witnesses and participants of the US biological programs.” The post concludes that these materials “confirm that the Pentagon aimed at creating elements of a biological weapon, and testing it on the population of Ukraine and other countries along the perimeter of the Russian borders.”

The defense ministry shared some of its “evidence” via the cloud service Disk Yandex. The link contains three folders containing unverified documents. The folders are titled “virological studies,” “experiments on Ukrainian citizens and military,” and “Rift Valley fever epidemic.” 

The Facebook account of the Russian embassy in the United States amplified the narrative and shared the documents. The documents also found their way to Kremlin propaganda platforms.

The DFRLab has tracked many instances of Russia spreading falsehoods about the US operating a biological weapons program since the start of the pandemic; Russia now employs similar narratives to justify its war against Ukraine.

Eto Buziashvili, Research Associate, Tbilisi, Georgia

Pro-Russia Telegram channels target Israel following Iran strike

Pro-Russia Telegram channels targeted Israel following a suspected Israeli drone strike against an Iranian ammunition factory on January 28. A few weeks earlier, the United States sanctioned Iran’s defense and aviation sector for supplying Russia with drones that are being used against Ukraine.

The Telegram channels responded to the Iranian strike by spreading anti-Israel and antisemitic narratives. Russian military blogger Roman Saponkov endorsed calls for the “demilitarization of Israel.” The account Операция Z (“Operation Z”) used antisemitic expressions to describe Jewish people. Elsewhere, Kremlin propagandist Vladimir Solovyev shared a post accusing Israel of providing shelter to “Nazis from the ‘Azov’ terrorist group.” Other pro-war channels shared graphic photos with claims that Wagner had found the bodies of Israeli and Polish mercenaries fighting in Ukraine.

Eto Buziashvili, Research Associate, Tbilisi, Georgia

Italy targeted by Russian accusations as Rome prepares new weapons package for Ukraine

Russia’s chief diplomat in Italy accused the country of engaging in anti-Russian discrimination, in an apparent attempt to pressure Italy to stop backing Ukraine and sway public opinion in favor of Russia. Earlier this week, Russian ambassador to Italy Sergey Razov published an open letter, ostensibly in response to comments made by Defense Minister Guido Minister Crosetto on why Ukraine needs international support. Razov accused the Italian government of putting in place “discriminatory restrictions” against Russian citizens. The letter was published on the Facebook account of the Russian embassy in Italy; at the time of writing, it had received more than 2,200 likes, 792 comments, and 698 reshares. 

In January, Italian media outlet Decode39 reported that the Russian embassy in Italy had published a series of social media posts “targeting Italy’s supposed military supplies to Ukraine in a bid to cast doubt on Rome’s logistical support and its effectiveness on the battlefield.” The social media posts were widely reshared and amplified the Kremlin narrative that falsely paints Ukrainians as “neo-Nazis.”   

Italy is poised to send a new package of military aid to Ukraine. “According to Defense Minister Crosetto, the package will contain air defense systems, namely Aspide surface-to-air missiles and the more advanced SAMP/T missile shield, of which some components will be supplied by Rome and others by Paris.  

Mattia Caniglia, Associate Director for Capacity Building, Brussels 

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How a health attache can elevate global health diplomacy https://www.atlanticcouncil.org/blogs/southasiasource/how-a-health-attache-can-elevate-global-health-diplomacy/ Thu, 26 Jan 2023 15:59:58 +0000 https://www.atlanticcouncil.org/?p=605785 In his recently published issue brief "Health attaches are the missing link in global diplomacy," non-resident senior fellow Dr. Edmond Fernandes argues that health attaches are the missing piece in diplomacy. To launch the brief, the South Asia Center convened a panel of experts.

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COVID-19 highlighted the flaws and inequalities in global public health systems as well as transboundary cooperation. As the world emerges from the pandemic, it is a critical time for health policymakers, diplomats, foreign governments, inter-country organizations, and practitioners to innovate and fill the gaps in the system. 

In his recently published issue brief Health attaches are the missing link in global diplomacy, South Asia Center non-resident senior fellow Dr. Edmond Fernandes argues that health attaches are the missing piece in diplomacy to strengthen global health infrastructure. He asserts that the system would benefit from having trained medical experts as health attaches to be the first line of communication between countries on the subject of global public health.

To launch the issue brief, the South Asia Center convened a panel of experts including academics and practitioners along with the author to assess the issue while reflecting on the wider need to prioritize global health diplomacy.

This program was recorded on January 17, 2023.

Featuring

Dr. Edmond Fernandes
Non-Resident Senior Fellow
Atlantic Council’s South Asia Center

Amb. Mustapha Jawara
Ambassador Extraordinary and Plenipotentiary to India with Accreditation to Sri Lanka, the Maldives, and Bangladesh
Ministry of Foreign Affairs, The Gambia

Dr. Rebecca Katz
Professor and Director of the Center for Global Health Science and Security
Georgetown University

Dr. Syed Muntasir Mamun
Chief Innovation Officer & Director General, International Trade, Investment & Technology, ICT
Ministry of Foreign Affairs, Bangladesh

Moderated by

Dr. Amita Vyas
Non-Resident Senior Fellow
Atlantic Council’s South Asia Center

The South Asia Center is the hub for the Atlantic Council’s analysis of the political, social, geographical, and cultural diversity of the region. ​At the intersection of South Asia and its geopolitics, SAC cultivates dialogue to shape policy and forge ties between the region and the global community.

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Aviso LatAm: January 21, 2023 https://www.atlanticcouncil.org/content-series/aviso-latam-covid-19/aviso-latam-january-21-2023/ Sat, 21 Jan 2023 15:40:27 +0000 https://www.atlanticcouncil.org/?p=604657 Protests in Peru descend into capital city Lima

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​​​​​What you should know

  • Brazil: The Supreme Court will investigate whether former President Jair Bolsonaro incited the January 8 attack on Congress and other government buildings in Brasilia.
  • Peru: People—mainly from remote Andean regions—descended on the nation’s capital to protest against President Dina Boluarte in support of her predecessor and demand elections and structural change in the country.
  • Trade: The value of goods exported from Latin America and the Caribbean (LAC) increased at an estimated rate of 18.8 percent in 2022, a downward trend from 27.8 percent in 2021, due to higher prices and low volumes.

Monitoring economic headwinds and tailwinds in the region

  • Argentina: The government will buy back overseas bonds equivalent to over $1 billion to improve its debt profile, looking to send a positive signal to markets despite low reserves levels.
  • Brazil: Vice President Alckmin said that Lula’s administration wants to remove a key tax on manufacturing and importing, the IPI, as part of a broader tax reform package. 
  • Guyana: The government announced $43.4 billion in funding for a new natural gas power plant, alongside distribution infrastructure improvements, to promote business and development. 
  • Multilaterals: During his inauguration, new Inter-American Development Bank (IDB) president Ilan Goldfajn announced three key priorities for the bank: social issues, climate change, and sustainable infrastructure. 
  • Mexico: The 2023 North American Leaders Summit concluded with new agreements to promote sustainability, strengthen supply chains, and respond to migration. 
  • Peru: The national statistics institute (INEI) said the economy expanded 1.7 percent year-on-year in November, marking a slight slowdown from the rise of 2.0 percent in October.

In focus: LAC in Davos

Latin American and Caribbean public- and private-sector leaders gathered alongside their counterparts from across the world in Davos, Switzerland, for this year’s Global Economic Forum. Colombia’s finance minister Jose Antonio Ocampo used the opportunity to push for a stronger agreement on minimum taxes for multinational companies. Brazil’s finance minister, Fernando Haddad, and environmental minister, Marina Silva, discussed Brazil’s positive economic outlook, environmental stewardship, and desire for regional integration. 

Spanish prime minister Pedro Sánchez also delivered a speech, in which he emphasized Spain’s role in building ties between Europe and Latin America, as Spain prepares to take over the Presidency of the Council of the European Union later this year. 

Health + Innovation

  • Vaccines: The Canadian government will donate $33.4 million to the Pan American Health Organization (PAHO) to increase access to COVID-19 immunizations for populations across the region. This donation is in addition to a prior contribution of $40 million in 2021.
  • Belize: The country will celebrate 34 years of relations with Taiwan through the construction of a new general hospital in San Pedro.
  • Nutrition: A new United Nations report found that 22.5 percent—or 131.3 million people—of the region’s population cannot afford a healthy diet, citing a country’s income level, the incidence of poverty, and level of inequality as contributing factors.

Geopolitics of vaccine donations: US vs. China

  • The United States outpaces China in its donations of COVID-19 vaccines to Latin America and the Caribbean, with Colombia and Mexico topping the list. The region has received roughly 52 percent of all US COVID-19 vaccine donations. To learn more, visit our COVID-19 vaccine tracker: Latin America and the Caribbean.

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Aviso LatAm: January 7, 2022 https://www.atlanticcouncil.org/content-series/aviso-latam-covid-19/aviso-latam-january-7-2022/ Sat, 07 Jan 2023 15:47:39 +0000 https://www.atlanticcouncil.org/?p=599785 Lula's return to power

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​​​​​What you should know

  • Brazil: On January 1, Luiz Inácio Lula da Silva was sworn in as president for a third term after defeating incumbent Jair Bolsonaro.
  • Outlook: According to the Economic Commission for Latin America and the Caribbean (ECLAC), economic growth will continue to slow in 2023 and reach 1.3 percent.
  • Venezuela: The opposition-led legislature dissolved the interim government led by Juan Guaidó. The vote signaled that members of the opposition had lost faith in Guaidó’s ability to oust Maduro. The United States will continue recognizing the 2015 National Assembly as the last remaining democratic institution in Venezuela.

Monitoring economic headwinds and tailwinds in the region

  •  Brazil: In 2022, trade surplus reached a record high of $62.3 billion. Total exports also reached a 335 billion high, helped by a boost in prices in the agriculture and livestock sector.
  • Argentina: The IMF disbursed a tranche of $6 billion from its $44 billion program with Argentina, citing positive indicators including falling inflation, a better trade balance, and foreign reserves. 
  • Colombia: Minimum wage will increase by 16 percent this year, to $242.7 per month. President Petro said the move would boost an economy slowed by inflation. 
  • Dominican Republic: The S&P upgraded the country’s credit rating from “BB-“ to “BB,” highlighting its strong recovery from the pandemic and long-term growth potential. 
  • El Salvador: The government will receive a $150 million loan from the CAF development bank, designed to strengthen its education system in the wake of the pandemic.  
  • Peru: The government launched a $1.6 billion plan to increase welfare and investment in regions gripped by protests following the ouster of former president Pedro Castillo. 

In focus: Nearshoring opportunities in the Americas

With the next North American Leaders Summit (NALS) set for this incoming week (January 9 and 10), nearshoring – the relocation of supply chains closer to the United States – is rising in importance.

Rising costs of and delays during shipping, coupled with the pandemic, have made businesses in the United States wary of relying on supply chains across the Pacific. As a result, some 400 companies explored reshoring to Mexico from Asia in 2022. Mexico’s manufacturing sector is now larger than it was before the pandemic, and Mexican exports to the United States have rapidly increased. Firms such as Walmart have already relocated some business to Mexico, while Tesla is planning a new factory in northern Mexico. NALS will pay particular attention to the electric vehicle production chain in North America.

Health + Innovation

  • Chile: In an effort to curb the spread of the BF.7 COVID-19 subvariant, travelers coming from China are now required to show a negative PCR test.
  • Haiti: Over 14,700 suspected cholera cases have been reported since December. Nine in every ten cases are from areas hit hard by food insecurity.
  • PAHO: Most countries in LAC invest less than the minimum 6 percent of GDP in health and allocate less than 30 percent of the health budget to the first level of care as recommended by the regional health organization.

Geopolitics of vaccine donations: US vs. China

  • The United States outpaces China in its donations of COVID-19 vaccines to Latin America and the Caribbean, with Colombia and Mexico topping the list. The region has received roughly 52 percent of all US COVID-19 vaccine donations. To learn more, visit our COVID-19 vaccine tracker: Latin America and the Caribbean.

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A next-generation agenda for US-ROK-Japan cooperation https://www.atlanticcouncil.org/in-depth-research-reports/issue-brief/next-generation-us-rok-japan-trilateral-cooperation/ Tue, 20 Dec 2022 17:51:10 +0000 https://www.atlanticcouncil.org/?p=596497 Trilateral cooperation among the United States, Japan, and South Korea has proved challenging over the years, owing largely to historical tensions. As a result, this project has sought perspectives from next-generation leaders of the three countries to define areas where targeted, flexible, and informal cooperative arrangements can provide clear mutual benefit to all.

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Trilateral cooperation among the United States, Japan, and South Korea has proved challenging over the years, owing largely to historical tensions. As a result, this project has sought perspectives from next-generation leaders of the three countries to define areas where targeted, flexible, and informal cooperative arrangements can provide clear mutual benefit to all. This issue brief calls for enhanced cooperation with likeminded allies and partners in order to counter shared challenges and advance mutual interests across the areas of security and defense, science and technology, and global public goods. Taken together, several essential themes emerge.

Future cooperation should center on tackling shared challenges including addressing an increasingly belligerent China through proactive yet constructive methods. In the security and defense sector, the three countries should prepare for Chinese economic reprisals by forming a united front. With regard to S&T, to protect against authoritarian threats, including those presented by China’s increasing technological prowess, the three countries should utilize multilateral frameworks, like IPEF, as tools to ensure the safety and security of scientific research and data. For public goods, the trilateral partnership can diversify away from Chinese supply chains by ally-shoring and information-sharing with trusted allies.

Given the historically fraught relationship between South Korea and Japan, the United States can act as a mediator to facilitate cooperation in areas of high benefit and low sensitivity. In security and defense, the trilateral partnership should address less-sensitive, shared security challenges, which include but are not limited to maritime incursions, crisis contingency planning, and cybersecurity. S&T can explore these new frontiers and safeguard free and fair principles for digital connectivity and data governance. Although public goods are less subject to domestic political pushback, the trilateral group’s actions are more likely to succeed if they are small, yet meaningful, such as implementing the democratic building blocks.

Lastly, trilateral cooperation requires both top-down institutionalization and bottom-up support from the general populace. With respect to defense and security, trilateral summits at the head-of-state level must be coupled with gaining public support. For S&T, the private sector can help advance collaboration, while the public sector helps each country remain in the bounds of domestic feasibility to prevent regional conflict. With global public goods, long-lasting trilateral progress requires coupling high-level government dialogues with civil society engagements.

Indo-Pacific Security Initiative

The Indo-Pacific Security Initiative works with US, allied, and partner governments and other key stakeholders to shape strategies and policies to mitigate the most important rising security challenges facing the region, including China’s growing threat to the international order and North Korea’s destabilizing nuclear weapons advancements. IPSI also addresses opportunities for cooperation in the region, such as transforming regional security architectures, harnessing emerging technologies, and developing new mechanisms for deterrence and defense cooperation.

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Webster in China-Russia Report: China reportedly planning to boost economic ties with Russia https://www.atlanticcouncil.org/uncategorized/webster-in-china-russia-report-china-reportedly-planning-to-boost-economic-ties-with-russia/ Sun, 18 Dec 2022 16:59:56 +0000 https://www.atlanticcouncil.org/?p=611723 The post Webster in China-Russia Report: China reportedly planning to boost economic ties with Russia appeared first on Atlantic Council.

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Aviso LatAm: December 17, 2022 https://www.atlanticcouncil.org/content-series/aviso-latam-covid-19/aviso-latam-december-17-2022/ Sat, 17 Dec 2022 14:00:00 +0000 https://www.atlanticcouncil.org/?p=596242 Peru's president ousted after attempt to dissolve Congress

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​​​​​What you should know

  • Peru: President Castillo was ousted by lawmakers after he sought to dissolve Congress ahead of an impeachment vote.
  • Brazil: The Economy Ministry rejected assertions by President-elect Lula’s transition team that Bolsonaro’s outgoing administration was leaving government finances “bankrupt.”
  • Social outlook: A recent Economic Commission for Latin America and the Caribbean (ECLAC) report projects that by the end of 2022, LAC will have 201 million people living in poverty – an increase of 15 million compared to the pre-pandemic situation.
  • ICYMI: On December 7, the Atlantic Council launched a paper on improving tax policy in LAC. Read it here.

Monitoring economic headwinds and tailwinds in the region

  • Argentina: signed a new information-sharing agreement with the US designed to root out tax evasion. It could increase tax revenue for Argentina by $1 billion US.
  • Barbados: concluded new funding arrangements with the IMF, $113 million US to continue its fiscal reform package and $189 million US towards its climate change response.
  • Brazil: President-elect Lula announced that Fernando Haddad, former minister of education and mayor of São Paulo, would be his finance minister.
  • Mexico: announced that additional consultations on the USMCA energy dispute would be held through early January, to ensure continued investment and confidence.
  • Peru: was placed under a state of emergency after protests gripped the country. Political upheaval led S&P to lower the country’s economic outlook to “negative.”
  • Transatlantic relations: Argentina called for reviewing the potential EU-Mercosur trade agreement, highlighting threats to local auto industry and barriers to agricultural exports.
  • Uruguay: criticized Mercosur’s inaction on trade agreements with large economies, drawing criticism for its own independent negotiations with China and to join the TPP.

In focus: Guyana’s carbon credits

Guyana is the first country to issue carbon credits designed to prevent forest loss and the first under the ART’s REDD+ Environmental Excellence Standard to ensure integrity and independent verification. The Hess Corporation, which is a partner in an oil consortium led by ExxonMobil that operates in Guyana, will purchase $750 million US of these credits. This move reflects how resilient growth, balancing between the opportunities in the energy sector and protecting its valuable environment, has become a priority in light of climate change and stresses like the COVID-19 pandemic.

These credits will support Guyana’s Low Carbon Development Strategy, with 15 percent of the revenues set aside for indigenous communities. With some 18 million hectares of forest, Guyana is a major carbon sink, and has previously worked with Norway to protect this resource. The new credits reflect Guyana’s status as a “High Forest, Low Deforestation” country, another first.

Health + Innovation

  • Argentina: Transport Ministry officials recommended all passengers travelling on public transportation to return to wearing face-masks amid a spike in COVID-19 cases.
  • Universal Health Day: The Pan American Health Organization (PAHO) director called on the region to redouble efforts towards achieving universal health as they begin to rebuild from the pandemic.
  • Mexico: The state of Nuevo Leon reintroduced the mandatory use of face masks in closed public spaces as the number of COVID-19 infections and other respiratory diseases rise.

Geopolitics of vaccine donations: US vs. China

  • The United States outpaces China in its donations of COVID-19 vaccines to Latin America and the Caribbean, with Colombia and Mexico topping the list. The region has received roughly 52 percent of all US COVID-19 vaccine donations. To learn more, visit our COVID-19 vaccine tracker: Latin America and the Caribbean.

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The numbers that drove China’s Zero-COVID policy https://www.atlanticcouncil.org/blogs/econographics/the-numbers-that-drove-chinas-zero-covid-policy/ Thu, 08 Dec 2022 22:15:18 +0000 https://www.atlanticcouncil.org/?p=593839 China's adherence to zero-COVID was primarily driven by poor vaccination rates among seniors and weak health care infrastructure. As the country opens, both factors remain key health risks.

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At the beginning of the pandemic, several countries pursued a zero-COVID policy. Governments such as those in China, Singapore, Australia, and New Zealand saw potential in an approach that focused all resources into total control and maximum suppression of the virus. Throughout 2021, as the rest of the world suffered from the rapid spread of emerging variants, people living in zero-COVID countries appeared to regain a large semblance of normal life. 

Simultaneously, their COVID-related deaths were only a fraction of those experienced throughout the rest of the world. However, as more infectious but less deadly variants emerged, one-by-one those other countries had outbreaks of their own and were ultimately forced to abandon the policy. China, with its immense state resources and powerful social controls, maintained its zero-COVID approach.

Successfully controlling case numbers bred complacency. In 2022 other countries built capacity to manage the virus through robust vaccination campaigns targeting the elderly, new therapeutics and treatments, and rising natural immunity. In contrast, China’s own policy approach, such as the lockdown of its most populous city Shanghai, appeared increasingly chaotic and oppressive. 

Zero-COVID has also become disastrous for the Chinese economy. For the first time since 1989, Beijing signaled it may miss its annual growth target of 5.5 percent, in part, because of its COVID restrictions. In recent days outraged citizens’ feelings transformed from waves of online anger into the largest protests China has seen in decades across Beijing, Shanghai, Shenzhen, and other cities and university campuses. 

So why then has Beijing maintained its zero-COVID approach that has led to historic protests and a stifled economy? 

Vaccinations

On its face, China has managed an incredibly successful vaccination campaign. As of November 11, 90 percent of China’s population had received two jabs, with 63 percent also receiving a booster. The United States has only fully vaccinated around 68 percent of its population with 34 percent also receiving a booster. China’s current vaccination rate is higher than any large nation when they began their respective openings. However, unlike other nations including the United States, China has been unable to encourage substantial vaccine uptake by its most vulnerable population groups, namely seniors. 

China’s elderly population’s vaccination status remains the primary hurdle preventing a safe removal of the country’s COVID restrictions. While senior vaccination rates largely match the rest of the country, their booster status continues to lag. This is especially treacherous for Beijing as China resists the use of Western mRNA vaccines, the backbone to the US and European COVID health response. They instead rely on less effective, homegrown Chinese vaccines. As the chart below demonstrates, Chinese-made vaccines are only able to match the protection offered by mRNA vaccines such as the BioNTech-Pfizer vaccine in seniors after three doses. To prevent the surge of elderly deaths, China must roll out widespread booster campaigns to inoculate its seniors ahead of any reduction in its zero-COVID policies. 

Beijing began taking steps to address this in late October. Regulators authorized the world’s first inhalable COVID vaccine which they hope will increase uptake among seniors with vaccination hesitancy. Following recent widespread protests, China has doubled down on these efforts and its top epidemic prevention body urged local governments to focus on getting the country’s elderly vaccinated against COVID. However, until China is able to get booster shots into the arms of its 254 million seniors, and particularly those older than eighty, Beijing risks a wave of deaths if it loosens restrictions. 

Health care infrastructure

Even with an effective vaccination campaign, China’s health care system is not prepared to manage the inevitable nationwide COVID outbreak that will follow any easing of its strict COVID restrictions. Because of Beijing’s current approach, China has focused its resources on containment and failed to build the robust defenses needed to treat severe cases in a mass outbreak. Since early 2020 China has heavily invested in a colossal construction campaign to build field hospitals which are designed to house and treat mild and asymptomatic COVID cases. This stands in contrast to governments such as those of the United States and European Union which directed asymptomatic and mild cases to isolate at home, easing the burden on their health care systems, and focusing on building care infrastructure and treatment capacity for serious cases. Now, as protests force Beijing to begin pivoting towards reopening, the country’s health care system has been caught flat-footed.

China lacks both the treatment capacity and the personnel to handle an intense COVID surge. China has 3.1 nurses per one thousand people, below developing economy peers such as Brazil which have 7.4 nurses per one thousand people—and a far cry from developed nations like Germany which have fourteen nurses per one thousand people. China also lacks the critical care beds needed to treat a surge. Demand for intensive-care beds could reach fifteen times the current capacity during a surge according to a study published in May. While vaccination rates have improved since then, they are still not high enough to prevent hospitals from being overwhelmed.    

China’s infrastructure deficit is further complicated by the country’s urban-rural divide. Rural areas have, on average, nearly 30 percent fewer doctors per one thousand people than China’s cities. They also still need major infrastructure investments as demonstrated by a $300 million loan the Asian Development Bank approved earlier this fall to improve public health services in poorer, rural regions in China after earlier waves of COVID exposed gaps in the state health system. Worryingly, the bank’s experts identify “admission surges that can negatively affect patient care and overburden facilities” as one of the motivating factors for the investment. 

China may not be able to build the staffing and treatment capacity needed under the timeline Beijing may adhere to following widespread protests. But it could still turn to stockpiling antiviral drugs and therapeutics such as the drug Paxlovid to help manage a future COVID wave. 

Towards a safer exit from zero-COVID

The coming winter will be the key test for Chinese policy makers. A late-November model suggests that if China were to lift strict restrictions now, Omicron could infect between one hundred and sixty million and two hundred and eighty million people—resulting in some 1.3 million to 2.1 million deaths, largely among unvaccinated seniors. 
Despite this, Beijing seems resolved in shifting away from its zero-COVID approach. To do this safely, it should prioritize pragmatic preparations, otherwise it risks a large, deadly wave of COVID infections such as the one Hong Kong experienced in spring 2022. When Hong Kong began repealing its COVID restrictions it lacked a concrete plan for exit. Its infrastructure was woefully underprepared and the policy directions its government provided were outdated and unrealistic. For example, even at the peak of its outbreak, the city continued to isolate mild cases in hospitals, exacerbating capacity issues and leaving those with severe infections underserved leading to a spike in deaths.

Beijing has appeared to learn from the city state’s mistakes and taken some initial steps to facilitate a safer exit from zero-COVID. On December 6th the CCP announced new policies aimed at accelerating vaccination among the elderly as well as a nationwide expansion of rules that allow home isolation for asymptomatic and mild infections, already allowed in Beijing after its quarantine facilities ran out of space. 

China should continue to prioritize the transition from preventing the spread of COVID towards the treatment of serious cases. Crucial areas to watch include Beijing’s ability to rollout an aggressive vaccination campaign focused on booster shots for vulnerable groups; the approval of new vaccines that either increase uptake or are more effective—such as China’s first homegrown mRNA vaccine; growth in China’s stockpile of COVID treatments; and updated guidance on the health risks of COVID and how hospitals and public health officials ought prioritize treatment. After 3 years of zero-COVID, a surge in cases may be inevitable but, through prudent policy and good preparations, a surge in deaths may still be avoided.


Niels Graham is an Assistant Director with the Atlantic Council GeoEconomics Center focusing on the Chinese economy.

At the intersection of economics, finance, and foreign policy, the GeoEconomics Center is a translation hub with the goal of helping shape a better global economic future.

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Holes in the great fire wall: Dissent and protests in China https://www.atlanticcouncil.org/content-series/360stratcom/holes-in-the-great-fire-wall-dissent-and-protests-in-china/ Thu, 08 Dec 2022 16:41:45 +0000 https://www.atlanticcouncil.org/?p=593524 At 360/StratCom, the DFRLab hosted a panel of experts on China’s Communist Party, surveillance architecture, protest, and the information environment for a conversation on the implications of recent events for China.

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In contrast to many countries currently living with the COVID-19 virus, Chinese leader Xi Jinping has tried to reduce infections to zero with his “dynamic” zero-COVID policy. Preventing infections in China over the past few years, according to the Chinese government, meant locking people in their homes and welding their doors, sending those exposed to COVID-19 to quarantine camps, and lining millions of people up for tests each day, sometimes in the freezing cold. Xi’s policy has in turn contributed to China’s slower-than-predicted economic growth rate and high youth unemployment. 

After a fire erupted in November in an apartment building in Urumqi, Xinjiang—a city that was under a one-hundred-day lockdown—and ten residents perished, protests spread widely across major cities in China. Protesters clashed with police and epidemic workers, calling for the end of the lockdowns and some even demanding Xi’s resignation. Since the peak of the protests, Beijing has detailed plans to relax COVID-19 restrictions and reduce testing requirements. 

To discuss the recent lockdown demonstrations in China, DFRLab Resident China Fellow Kenton Thibaut moderated a panel at the Digital Forensic Research Lab’s 360/StratCom this year. Maya Wang, associate director at Human Rights Watch, observed that dissatisfaction with the COVID-19 restrictions has grown steadily over the three years of strict enforcement. “The bottled-up energy essentially exploded,” she remarked. However, it was not just the fire that prompted the unrest. Wang explained that prior grievances also laid the groundwork for the protests today, such as the twenty-seven people killed in the crash of a bus carrying people to quarantine in September and the Sitong Bridge protest before the China’s Twentieth Communist Party Congress. 

On why Xinjiang became the focal point for the large protests, Sheena Greitens, associate professor at the LBJ School of University of Texas Austin, stated that Xinjiang was a test case for Xi’s national-security concept. According to Greitens, the Chinese leader’s strategic goal appeared to be to prevent large-scale protests from spreading between locations, economic classes, and ethnic groups. Yet the fire, Greitens added, brought commonality and solidarity between the Han majority in the rest of China and the Uyghur minority in Xinjiang. She added that these protests tested the security apparatus and revealed shortcomings in the system. “I don’t think that this means the system overall has failed,” said Greitens. The capabilities the Chinese government have built are still useful for interrupting protests and punishing individuals who have participated.  

Xiao Qiang, research scientist and the founder of US-based China Digital Times, also underscored the importance of the Sitong Bridge protests for inspiring the messages in the recent protests. Xiao said the Sitong Bridge and the current demonstrations were “so different from previous ones in the last thirty years” because their focus went beyond COVID-19: They also targeted the government’s censorship and Xi’s leadership. He also recounted how information about the protests flowed across borders. Protesters circumvented the Chinese internet firewall using virtual private networks (VPNs) to send videos to volunteer activists worldwide, he explained. For example, a Twitter user in Italy quickly reposted protest videos sent by protesters and then sent the videos “immediately back to China so that people in the city almost in real time know where the protests are,” Xiao explained. This fluid information environment, he added, overwhelmed the Chinese censorship mechanisms. 

While the crackdowns on these large-scale mobilizations have been much less harsh than crackdowns in 1989, Greitens cautioned against painting the regime as becoming more tolerant of opposition, remarking that the Chinese Communist Party has shifted punishment from public spheres, such as the protest areas, to “individualized, targeted private spaces that we can’t see.”  

As the protests wound down, some observers were disappointed by the results and that there has been no structural political change. But Wang offered more nuance: “Even in the West… things do not change overnight,” noted Wang. “People should not expect any differently from China. People should also not discount the inspiration that these protests brought… The protests are important this time because they give people hope they are not alone,” she said. 

As everyone in China has been affected by the lockdowns in some way, the protests have also included people from all walks of life. Xiao highlighted the participation of students across eighty university campuses, indicating the extent to which young people disagree with the direction Xi is taking China. The students, he said, do not see the same hope for their future given what they perceive as China’s current trajectory. The gender dynamics underpinning the protests were also striking, with Wang noting that women in China are becoming more vocal and organizing protests: “The participation of women is often the central muscle that keeps these movements going in many parts of the world,” she said. 

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Health attaches are the missing link in global diplomacy https://www.atlanticcouncil.org/in-depth-research-reports/issue-brief/health-attaches-are-the-missing-link-in-global-diplomacy/ Mon, 05 Dec 2022 20:21:19 +0000 https://www.atlanticcouncil.org/?p=591129 Given the globalized nature of the modern world, with frequent travel and people living outside their home countries for extended periods for a variety of reasons, standardizing a healthcare liaison from one’s home government would be a crucial step in internationalizing public health diplomacy.

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The health attaché will serve as the prime representative and advocate for healthcare, development, human rights, and trade for the people represented by the embassy or mission in the host country. Given the globalized nature of the modern world, with frequent travel and people living outside their home countries for extended periods for a variety of reasons, standardizing a healthcare liaison from one’s home government would be a crucial step in internationalizing public health diplomacy.

The attaché will also further multilateralism by supporting embassies and/or high commissions via a health security and development angle. This work will intersect within a domestic and international setting by providing intellectual support on global health outcomes to local and national officials and work to build bilateral ties on issues of shared medical, public health, pharmaceutical, technological, and academic interests across the health and development sectors. As an individual, the health attaché should carry a strong track record on public health and healthcare issues, and be a local citizen of the receiving country. The health attaché’s professional philosophy will speak a language of social progress where health is portrayed as a means of investment as opposed to expenditure, where human life is valuable beyond dry statistical means, and where sensible engagement serves to inform classic diplomacy that puts people ahead of political goals.

The office of a health attaché must have dual goals: to strengthen bilateral relations among and within countries; and to improve public health systems with health intelligence inputs that have the potential to influence outcomes, while also providing local assistance to country nationals who may need help.

Today’s health attaché must be a person with sound knowledge of understanding diseases and global health outcomes as well as have keen interest in the processes of understanding national priorities with sound solutions for policies that have impact at scale.

The South Asia Center is the hub for the Atlantic Council’s analysis of the political, social, geographical, and cultural diversity of the region. ​At the intersection of South Asia and its geopolitics, SAC cultivates dialogue to shape policy and forge ties between the region and the global community.

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Aviso LatAm: December 3, 2022 https://www.atlanticcouncil.org/content-series/aviso-latam-covid-19/aviso-latam-december-3-2022/ Sat, 03 Dec 2022 08:19:00 +0000 https://www.atlanticcouncil.org/?p=591118 Latin America and the Caribbean's stagnation is 'worse than the 1980s'

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​​​​​What you should know

  • Economic outlook: The head of the UN Economic Commission on Latin America and the Caribbean (ECLAC) said that the region’s stagnation is ”worse than the 1980s” due to weak investment, low productivity, and inadequate education.
  • Mexico: Remittances sent from workers abroad surpassed $5.35 billion in October, beating economists’ forecast on US job strength.
  • #ProactiveLAC: On Wednesday, December 7, the Atlantic Council will host a virtual conversation on LAC’s economic outlook, fiscal policy, and small and medium-sized enterprises in uncertain times. Register here.

Monitoring economic headwinds and tailwinds in the region

  • Argentina: Upcoming legislation is set to encourage investment in its liquified natural gas sector, as demand, driven by the war in Ukraine, continues to grow. 
  • Bolivia: The country lowered its 2023 growth forecast from 5.1 to 4.8 percent, as an ongoing strike in Santa Cruz has led to over $780 million in losses.  
  • Chile: During the recent high-level dialogue with the United States covering migration and sustainable development, both parties agreed to relaunch their bilateral Science, Technology, and Innovation Council. 
  • Dominican Republic: The United States will block sugar imports from Central Romana, the Caribbean nation’s largest employer, accusing it of using forced labor
  • Ecuador: The government is considering a new financing deal with the International Monetary Fund (IMF) for 2023, as its current agreement is set to expire at the end of 2022.  
  • Guyana: According to new ECLAC data, the country recorded the highest FDI growth in the Caribbean in 2021, and now accounts for half of all Caribbean FDI, thanks to its booming hydrocarbon sector.  
  • Peru: Farmers and truckers set up roadblocks to protest rising gas and fertilizer prices, driven up by the war in Ukraine.  
  • FDI: In a 2022 ECLAC report, Foreign Direct Investment (FDI) in Latin America and the Caribbean (LAC) rose by 40.7 percent in 2021 but fell short to achieve pre-pandemic levels.

In focus: Venezuelan thaw

Last weekend, the United States granted Chevron a six-month license to expand operations in Venezuela after the Maduro government agreed to resume talks in Mexico City with the country’s opposition. The two sides signed an agreement to use frozen Venezuelan assets for humanitarian relief as well.  

The United States has framed this policy shift as a “targeted” response to promote “concrete steps” forward by the parties meeting in Mexico City. At the same time, the energy crisis driven by Russia’s war in Ukraine has elevated Maduro’s–-and Venezuela’s –-importance in a time of rising oil demand.  

Health + Innovation

  • ICYMI: On November 16, the Atlantic Council launched a report with actionable recommendations for improving immunization program outcomes and financing in the region. Read it here.
  • Uruguay: Health authorities issued a recommendation that immunocompromised patients and over 50 year-olds should take their fifth dose of the COVID-19 vaccine.
  • Food insecurity: An ECLAC report found that 56.5 million people in LAC are impacted by hunger.

Geopolitics of vaccine donations: US vs. China

  • The United States outpaces China in its donations of COVID-19 vaccines to Latin America and the Caribbean, with Colombia and Mexico topping the list. The region has received roughly 52 percent of all US COVID-19 vaccine donations. To learn more, visit our COVID-19 vaccine tracker: Latin America and the Caribbean.

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Roberts Discusses China Protests on Complete Intelligence https://www.atlanticcouncil.org/insight-impact/in-the-news/roberts-discusses-china-protests-on-complete-intelligence/ Thu, 01 Dec 2022 19:42:18 +0000 https://www.atlanticcouncil.org/?p=603158 On November 30, IPSI Senior Fellow Dexter Tiff Roberts appeared on Complete Intelligence to discuss the origins and context of the protests in China. Roberts highlights “the deep economic malaise,” in addition to frustrations over COVID-zero, as key factors that contributed to the protests. Moreover, he remarks on the significance of a sense among young […]

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On November 30, IPSI Senior Fellow Dexter Tiff Roberts appeared on Complete Intelligence to discuss the origins and context of the protests in China. Roberts highlights “the deep economic malaise,” in addition to frustrations over COVID-zero, as key factors that contributed to the protests. Moreover, he remarks on the significance of a sense among young people in China that the Chinese Communist Party and Beijing are not infallible.

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Is China facing another Tiananmen moment? https://www.atlanticcouncil.org/content-series/fastthinking/is-china-facing-another-tiananmen-moment/ Mon, 28 Nov 2022 17:34:51 +0000 https://www.atlanticcouncil.org/?p=589567 Our experts break down how far China's anti-lockdown protest movement could go, what kind of threat it poses to Xi’s government, and what the world should expect next.

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GET UP TO SPEED

They won’t be locked down. Protests against China’s zero-COVID policies have spread across the country, with some demonstrators even calling for Communist Party General Secretary Xi Jinping to step down. Today, police sought to more forcefully clamp down on protests in Beijing and Shanghai. How far could the protest movement go, what kind of threat does it pose to Xi’s government, and what should the world expect next? Our experts are on the case.

TODAY’S EXPERT REACTION COURTESY OF

Man in a box

  • How did we get here? The Chinese Communist Party (CCP) is “boxed in by its zero-COVID policy,” John tells us: It has tried to stamp out the spread of the disease with lockdowns and refused to import Western vaccines, and any change in course would be an unacceptable admission of defeat on those fronts.
  • But staying the course has resulted in unrest from “the brave tip of the iceberg” of protesters, numbering mostly in the hundreds, John says. “In some ways, this is the situation for which Xi and his predecessor built the hardened party-state. But like even the biggest bank, they can’t survive a run in the form of major, persistent protests everywhere all the time.” 
  • It all adds up to “the greatest challenge to Xi’s power since he first claimed China’s helm a decade ago,” Michael says.
  • The protests also undermine Xi’s claims that China’s COVID management “has demonstrated the effectiveness of China’s authoritarian system in comparison to democracy,” Dave says, “and more broadly put the lie to the argument frequently (and increasingly) repeated by Chinese officials that the Chinese people overwhelmingly approve of Party rule and its approach to governance.

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Crack down and shake up

  • A “practical course” for the CCP to pursue would be to carry out a “selective crackdown” now and ease it over time, John says. A date to watch is the Chinese New Year celebration in late January: “If they prevent travel on a large scale, their security nightmare will deepen, but travel could create superspreader events nationwide.”
  • Michael points out that the measures announced so far to ease—or “optimize,” as the regime calls it—the zero-COVID policy are generally tweaks to the existing system, such as reductions in certain quarantine periods. “I think the government is going to have to introduce more fundamental changes to really make a difference,” he says. “As long as the pandemic strategy relies on arbitrary detentions and business closures, people’s lives and livelihoods will continue to face disruptions, and public discontent could continue to rise. Furthermore, as long as the leadership demands infections must be kept at or near zero, local officials will still feel pressured to take whatever steps they can to suppress the virus on their watch. And that means continued abuses.”
  • In the videos of the protests that have leaked out so far, John sees only local police and health officials trying to quell the crowds—not the “huge anti-riot force” of the People’s Armed Police (PAP). “When we see the PAP in Beijing, Shanghai, or other major cities, that will demarcate an intensifying crisis.” 

Shades of 1989

  • While Dave cautions that the protest activity “does not mean we are witnessing the beginning of the end of the Communist Party,” he says a crackdown by internal security forces including the PAP “would likely set the groundwork for even more repressive policies across the board as the Party-state’s rule becomes more brittle and reliant on the threat of brute force and information control to maintain power.”  
  • We’re starting to see comparisons to the mass student protests of 1989 that led to leadership divisions in the Chinese government and the Tiananmen Square massacre. “If there’s going to be a major 1989-scale political crisis, it will have to start at the top, not from the grassroots,” John says, and there’s little appetite from elites to challenge Xi so soon after he solidified his power at the Party Congress in October.
  • “But there’s a perfect storm potential where the regime relies on the stick, doesn’t provide hope or a plan to get out of zero-COVID hell, and protests spread, build, and are sustained,” John adds. He cautions, though, that it will be hard for those outside China to gauge any political splits in Beijing beyond assessing who shows up for major events or spotting criticism dribbling out from former top Chinese leaders.
  • In such a scenario, the Chinese government could send in the People’s Liberation Army (PLA), as it did during the Tiananmen massacre. “If you see the PLA rolling into cities, that means the regime is ready to kill people to stay in power, but their initial goal would be to avoid that by cowing” the public, John says. “No competent regime pushes their military, no matter how loyal, into repeated confrontations with the people—it’s a card they can only play a few times before the guns could start to swing the other way.”

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Aviso LatAm: October 30, 2022 https://www.atlanticcouncil.org/content-series/aviso-latam-covid-19/aviso-latam-october-30-2022/ Sun, 30 Oct 2022 19:45:00 +0000 https://www.atlanticcouncil.org/?p=580537 57 percent of the English and Dutch-speaking Caribbean are food insecure

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​​​​​What you should know

  • Regional recovery: Of the 20 million people in Latin America who fell into pandemic-induced poverty, only 7 million have escaped it during the recovery.
  • Nicaragua: The United States announced new sanctions on its mining industry in response to continued repression, targeting its largest export, gold.
  • Brazil: Incumbent President Bolsonaro and former President Lula de Silva will face off in a second-round run-off election this Sunday. Join us Monday for post-election analysis.

Monitoring economic headwinds and tailwinds in the region

  • Brazil: The government nominated its former central bank director, Ilan Goldfajn, for the presidency of the Inter-American Development Bank. Also nominated is Alicia Bárcena, former head of ECLAC, by Mexico.  
  • Cuba: The United States granted $2 million in humanitarian assistance to assist in the country’s  recovery from Hurricane Ian last month. 
  • Ecuador: The government secured joint IDB-EU funding for an energy interconnection project with Peru, estimated to save $61 million annually through reduced fossil fuel use. 
  • Jamaica: The country welcomed a $300 million investment by Huawei in an effort to double down on its goal of digital transformation.
  • Peru: Ongoing political instability prompted a new negative rating for its credit outlook, attributed to cabinet reshuffling and impeachment attempts against President Pedro Castillo. 
  • ECLAC: This week, the Economic Commission for Latin America and the Caribbean (ECLAC) redoubled its commitment to transform development models for productive regional transformation during its thirty-ninth session.

In focus: Transatlantic ties

A recent report highlights the potential for strengthening European investment and connections with LAC, focusing on three main pillars: digital connectivity, cybersecurity, and digital rights. Emphasizing the key opportunity of Spanish leadership through Spain’s upcoming presidency of the EU, the report also explores the potential of the EU-LAC Digital Alliance planned for 2023. 

At the same time, the EU High Representative for Foreign Affairs, Josep Borrell, attended the fourth EU Investment Forum in Montevideo this week. He used the opportunity to reaffirm European commitment to a free trade agreement with Mercosur.  

Health + Innovation

  • Ecuador: The latest country to drop all travel restrictions and return to pre-pandemic entry policies for foreigners.
  • Brazil: Brazilians paid tribute in São Paulo to COVID-19 victims. To date, Brazil has lost 680,000 lives to the pandemic.
  • Recovery: The World Bank granted Guatemala a recovery loan for healthcare and social services in the wake of the COVID-19 pandemic.

Geopolitics of vaccine donations: US vs. China

  • The United States outpaces China in its donations of COVID-19 vaccines to Latin America and the Caribbean, with Colombia and Mexico topping the list. The region has received roughly 52 percent of all US COVID-19 vaccine donations. To learn more, visit our COVID-19 vaccine tracker: Latin America and the Caribbean.

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What Xi Jinping’s third term means for the world https://www.atlanticcouncil.org/in-depth-research-reports/issue-brief/what-xi-jinpings-third-term-means-for-the-world/ Fri, 07 Oct 2022 15:00:00 +0000 https://www.atlanticcouncil.org/?p=573338 It has been widely believed for some time, both inside and outside of China, that current Communist Party General Secretary Xi Jinping will break with modern precedent and extend his reign into a third, five-year term. Xi, who also serves as the country’s president, has been working toward this outcome for years.

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Introduction

The inner workings of high-level Chinese politics are a black box. China watchers, not unlike the Kremlinologists of yesteryear, are forced to sift through dinner-party gossip and the front pages of the People’s Daily for clues about who’s in and who’s out. Winners in the backroom brawls of China’s politics are never certain until they are revealed at Chinese Communist Party congresses every five years. It is remarkable that even today, with China a rising world power and second-largest economy, that its political process remains so opaque.

This time around, with the much-anticipated twentieth Congress scheduled for an October 16 opening, the picture is clearer than usual. It has been widely believed for some time, both inside and outside of China, that current Communist Party General Secretary Xi Jinping will break with modern precedent and extend his reign into a third, five-year term. Xi, who also serves as the country’s president, has been working toward this outcome for years. In 2018, for instance, he engineered a constitutional reform to eliminate term limits on the presidency. His propaganda machine has elevated the status of Mao Zedong, who ruled practically without challenge from the founding of the People’s Republic in 1949 to his death in 1976. Xi Jinping Thought, a compendium of his ideas, is required reading in Chinese schools. Meanwhile, Deng Xiaoping, the leader who championed a more collective form of governance, has been downgraded in the government’s public messaging. Clearly, Xi has been laying the groundwork for renewed one-man dominance of China’s political system.

Of course, the results of the upcoming Congress cannot be determined with metaphysical certitude. The world will have to wait for the latest big reveal, like always, to see if Xi still rules the roost. Perhaps more importantly, the global community will find out who else will sit on the all-powerful Standing Committee of the party’s Politburo with him,1 to gauge how much control he will command in coming years. However, barring unforeseen circumstances, world leaders should expect to see Xi at global forums for at least five more years.

The implications of Xi’s continued grip on power are tremendous for both China and the world. The decisions he makes in Beijing will reverberate well beyond China’s borders to influence the global economy, the development of technology, international governance, and war and peace. At this stage in China’s political cycle, the world would usually ask: Who will rule China? This year, the important question is: What will Xi do with his power?

Return of one-man rule

To appreciate the importance of the twentieth Congress, it is critical to understand how dramatically Xi has altered the way China is governed. Beginning in the 1980s, the Communist Party fostered a system of collective leadership, in which power was shared within the party and between the party and state apparatus. This system was developed to include regular, peaceful transitions of power from one leadership team to another at congresses held every five years. Top leaders stayed in their official posts for no more than ten years. The system was a reaction against the turmoil of the first three decades of the People’s Republic. Mao ruled as more than a dictator—he was practically a Communist demigod; his every word was gospel. However, allowing one person to wield such immense power proved catastrophic for China. Mao’s Great Leap Forward (1958-61), an ideologically motivated attempt to catapult a poverty-stricken China into the ranks of the rich by mass movements, left some 30 million Chinese dead from famine. He followed that up in 1966 with the Cultural Revolution, a campaign to uproot the stubborn vestiges of an old, corrupt China (and solidify Mao’s own political position), which resulted in a decade of widespread violence and economic paralysis. By the time of Mao’s death in 1976, China was exhausted, desperately poor, and dangerously isolated.

The reformers who eventually succeeded Mao, led by Deng Xiaoping (a victim of the Cultural Revolution himself), reacted against the trauma of one-man rule. “It is not good to have an over-concentration of power,” Deng said in a 1980 speech on this subject. “It hinders the practice of socialist democracy and of the Party’s democratic centralism, impedes the progress of socialist construction, and prevents us from taking full advantage of collective wisdom.”2

The Communist Party still dominated—that was the unfortunate lesson of the massacre in Tiananmen Square in 1989—but within the party and state, space opened for greater debate on policy. That allowed for a wider range of expertise to influence the policy process and earned the Chinese state a reputation as a “technocracy”—a finely tuned, generally pragmatic, and usually predictable policymaking machine. It is impossible to separate China’s tremendous economic success from the emergence of this collective governance system.

Xi has thoroughly altered this system. He has sidelined other major figures in the governing order and claimed their power for himself. For instance, in the past, the premier, the number two position in the ruling hierarchy, took responsibility for economic matters. The current person in that post, Li Keqiang, was widely expected to take on this role when Xi’s leadership team first took control in 2012. However, under Xi, Li has become a marginal figure. Xi has grasped control over the policymaking process across all sectors by dominating high-level commissions of top leaders on various areas of policy and by promoting allies and loyalists into key positions throughout the party and state apparatus.3 

Xi’s grip on policy has been further enhanced by the relentless promotion of his personality cult. Xi is presented to the Chinese people (and from there, the world) as a brilliant theoretician who possesses the wisdom to achieve the rejuvenation of the Chinese nation and resolve the most complex problems facing the international community. Xi’s ideas, encapsulated in Xi Jinping Thought, echo Mao’s Little Red Book in the way they have become the source of extensive study and fawning reverence. Xi’s mere utterance can send officials and bureaucrats scampering to decipher and implement his wishes. 

To a great degree, what Xi wants, Xi gets. As a result, Chinese policymaking has become increasingly dependent on the decisions and desires of a single individual. That has already rendered the direction of Chinese policy less predictable. 

Anticipating the course of Chinese policy has thus become a matter of identifying Xi’s priorities—whether national, ideological, or personal. In a sense, the current system of Chinese governance is exactly what Deng and his fellow reformers intended to avoid. China and its vast population have again been set adrift on the whims of a single individual.

The future of zero-COVID

Attempting to read Xi’s mind is a dangerous (and thankless) task. Yet any attempt to assess the direction of Xi’s China must give it a whirl. Fortunately, after a decade in charge, Xi has left a lengthy record of speeches, initiatives, and actions that offer a foundation from which to peer into the future of Xi’s agenda. Of course, as with the stock market, past performance cannot determine what might come with certainty. Xi could break with his own precedents and shift course in the face of new challenges and circumstances, or he could come under enough pressure internally or externally to compel him to revise his agenda. At the same time, he has expressed a slate of ideas and beliefs that can help the beleaguered China watcher more comfortably envision the course upon which he could take the country. The fact that Xi is more ideologue than pragmatist also makes it somewhat safer to assume his past practice will continue into the future.

Still, there remains some expectation (or hope) both within China and elsewhere that Xi will change aspects of his policies once he secures his coveted third term. This thinking holds that Xi will have greater flexibility in policy choices once his own authority is locked on track. This possibility is discussed most often in relation to Xi’s most prominent program: zero-COVID.

Xi’s insistence that his government keep COVID cases at or near zero has prevented a major pandemic on the scale suffered in most other countries. However, the continuation of the zero-COVID policy nearly three years since the epidemic’s initial outbreak in Wuhan has suppressed economic growth, badly damaged small businesses, and fomented widespread public frustration. Speculation has persisted for some time that Xi might be willing to ease the strict pandemic controls—which include recurring lockdowns of major cities, long quarantines for travelers, and repetitive testing—after the upcoming Congress. That expectation is based on the assumption that Xi has insisted on maintaining zero-COVID for personal political motivations. After having touted zero-COVID as a great success both at home and abroad, Xi became “boxed in” by a political narrative that ties him intimately with the approach.4 This has made it difficult for him to change course from a political perspective, especially ahead of the Congress. A major outbreak before Xi’s anointment would simply be too embarrassing for him to risk. With the Congress behind him, the argument goes, Xi will be freed to adjust or even lift zero-COVID to address pressing economic concerns.

Yet there are equally good reasons to suspect zero-COVID is here to stay, at least in some form. Five years ago, there was similar chatter that Xi would return to liberal economic reform once he claimed his second term. Instead, he moved further from that path. Xi may calculate that that political narrative in which he defeated the virus where other, mere mortal leaders failed will continue to be too useful to his stature to lift zero-COVID, even after the Congress. He also seems to believe that abandoning the policy would have negative political consequences for the Communist Party more broadly, A late July 2022 Politburo meeting concluded the policy needed to be addressed within a political perspective. After all, the party markets itself to the Chinese public as infallible; ditching zero-Covid could appear an unacceptable admission it has erred.

There is also a possibility that Xi is committed to zero-Covid because he believes it is best for China, or his vision of what China should be. The assumption underlying much of the debate about zero-COVID is that the leadership wants to find an off-ramp but has not managed to do so. There are some members of the political and business elite who would support a loosening of the COVID strictures. However, Xi has continually reiterated that zero-COVID is the best policy for China, even as its economic and social costs mount, and the approach appears to present possible political downside as well. The two-month lockdown of Shanghai earlier this year provides a telling example. Despite these problems, Xi has shown a consistent tendency to tighten the state’s grip over society to advance his ideological agenda of a refashioned China and to solidify his personal grip on party and state. Zero-COVID has been and can continue to be a convenient tool to achieve his goals. For instance, while business leaders may be troubled by the growing isolation of China due to restrictions on travel and quarantines for travelers, Xi may see these measures as a way to limit foreign influence—a physical cordon on dangerous outside ideas and information to match the digital Great Firewall. Note that Beijing reduced the quarantine period for incoming travelers in June but has not eased restrictions on Chinese nationals’ outbound travel, introduced in May. Furthermore, Xi may find the enhanced monitoring of the populace and empowerment of local, community-level officials in the name of pandemic prevention useful to tighten state control over society. That suggests zero-COVID, or a form of it, may become a fact of life in China. It is likely that a number of its restrictions and rules will be retained to the benefit of Xi’s surveillance state but to the detriment of personal privacy.

The future of economic policy

Another element in the debate about zero-COVID is the current miserable condition of the Chinese economy. The International Monetary Fund (IMF) forecasts gross domestic product (GDP) will expand a mere 3.3 percent in 2022. Zero-COVID is a major contributing factor to this slowing growth. Its persistent lockdowns and restricted travel have suppressed consumption, supply chains, and small business, especially in the service sector. The assumption among many China experts is that at some point, Beijing will have to loosen COVID controls to alleviate the deepening economic problems.

However, Xi appears to be deviating from past practice in regard to the importance of economic growth as a policy goal. China watchers have been conditioned over the past three decades to assume the Chinese leadership will prioritize economic development over all other issues. The Communist Party has long marketed the country’s high growth rates as a mark of its competence and legitimacy. Further, the party’s obsession with social stability prompted officials to fear the joblessness and discontent caused by weak economic conditions. Amid zero-COVID, however, Xi has signaled that economic development may no longer be the party’s No. 1 priority. In recent months, even as Li, the premier, has exhorted local officials to resurrect economic growth, the party has also been willing to accept economic sacrifices in order to maintain the zero-COVID stricture.

That could be part of a much broader and critical shift in the direction of Chinese policy. Going forward, the pursuit of economic development may be balanced, or even downgraded, relative to political, security, and social concerns.5

Such a shift has major implications for China’s economic relations with the rest of the world. It explains why Xi has replaced the long-standing, guiding principle of “reform and opening up” with a new mantra of “self-sufficiency.” Xi will almost certainly continue to stress the need to reduce China’s vulnerabilities to the outside world by substituting imports with homemade alternatives. As Xi once said: “The essence of the new development dynamic is realizing a high level of self-reliance.”6 Xi will therefore persist in his efforts to develop Chinese technologies through state-led industrial policies with their heavy subsidization of local high-tech industries, despite their massive waste of resources and underwhelming results thus far.

That suggests two important trends for economic policy in Xi’s third term. First, he will continue to prioritize economic security over economic efficiency—in other words, he is willing to sacrifice growth for political objectives. Second, Xi’s economic agenda will also foment greater competition with the United States and other advanced economies in cutting-edge technologies—most of all semiconductors. Chinese policymakers will persist in pursuing tactics, such as forced technology transfer and subsidization, that are a cause of trade friction with Washington. Overall, Xi’s economic policies will have the effect of limiting the further integration of the Chinese economy into the global economy, likely increasing disputes with trading partners, encouraging foreign governments to impose restrictions on business investment and trade with China, and capping the ability of Chinese companies to go global.

Xi’s penchant for political control will influence the course of economic policy in other ways as well. He has partially reversed domestic economic liberalization, and instead, he is reasserting a level of state influence over the private sector. The most visible manifestation of that trend has been the imposition of greater regulation on many sectors of the economy over the past two years. That campaign constrained the ability of some companies, especially in technology, to expand, or, in the case of private education services, even survive. Global investors wonder if the harsh crackdown has finally run its course. But that is the wrong question to ask. Xi has displayed a wariness of private enterprise distinct from his recent predecessors. He has spoken of the need to “prevent the disorderly expansion and unchecked growth of capital,”7 and he appears to fear that the growing wealth and influence of private companies and entrepreneurs could present a threat to the Communist Party’s dominance. Xi may intend to subordinate the private sector to the interests of the state and party. Under Xi, the Communist Party adopted a policy to enhance its control over the management of private companies. Xi has also elevated the narrowing of income disparities, between both income groups and regions of the country, to priority status in Beijing’s economic agenda with his campaign for “common prosperity.” Although the policy platform to achieve “common prosperity,” remains a vague work-in-progress, the prominence placed on this idea is a signal that Xi disapproves of the unfettered expansion of personal wealth generated through entrepreneurship and private enterprise. Such an attitude is detrimental to economic development since it discourages entrepreneurial activity and innovation. As in all countries, however, pressuring the rich makes for good politics, and Xi seems to revel in such populist exploits. Though Chinese officials have stressed that “common prosperity” is not a code for soaking the wealthy, its main achievement thus far has been arm-twisting major private firms to divert more profits into charitable causes. Expect Xi to persist in these populist causes as a method of bolstering his credentials as a “man of the people.”

Xi and Taiwan

All the factors discussed above add up to slower growth, and a problem for the Communist Party. The leadership will no longer be able to justify their repression with the promise of economic benefit. The party’s implicit social contract with the public—let us rule and we will make you rich—could break down. Xi must instead find other sources of “performance legitimacy,” or other measures of the party’s right to rule, and new endeavors to rally support for and redirect frustration away from the Communist regime.

It has become fairly obvious over the course of Xi’s term that he is attempting to capitalize on nationalist causes as a substitute for economic development and the new source of party legitimacy. Much of Xi’s public discourse focuses on achieving national rejuvenation. This goal goes beyond simply gaining wealth to restoring China’s greatness on the world stage. Inevitably, such appeals to nationalism lead to the issue of Taiwan. Claiming Taiwan has long been a top priority for the People’s Republic, but Xi appears to be elevating the issue even higher on Beijing’s to-do list. Further, he is doing so in potentially dangerous and destabilizing ways. Beijing has not held any serious dialogue with Taipei since the current Taiwanese President, Tsai Ing-wen, took office in 2016. Instead, Xi has chosen to increase diplomatic and military pressure on Taiwan in an attempt to prevent Tsai from extending her government’s international stature and ties to other countries, especially the United States. Since mid-2020, Xi has launched a concerted campaign of military intimidation by routinely sending squads of jets buzzing near the island and holding drills in the surrounding waters. Beijing has intensified efforts to isolate Taiwan’s government on the international stage. For example, China employed economic coercion against Lithuania after the Baltic nation strengthened ties with Taipei. China’s protests reached a fever pitch in response to US House Speaker Nancy Pelosi’s visit to Taiwan in early August 2022. Accusing Washington of undermining the idea of “one China,” Beijing threatened the United States with unspecified countermeasures and staged extensive military exercises surrounding Taiwan, creating the effect of a blockade for the first time.

All parties are blaming one another for this escalation. Yet it is undeniable that the Xi administration has purposely chosen a more hostile, militant approach to the Taiwan question. Xi’s posture could be driven by a fear that the island is being drawn ever more tightly into the United States’ orbit and away from China’s. A debate has erupted among foreign policy analysts over whether Washington is fanning those fears, inadvertently or otherwise, by its persistent displays of support for Taiwan’s democratic government. As is the case with much of Xi’s foreign policy, however, his assertive approach has created the very situation he intends to prevent. Rather than convincing Tsai to submit, Xi reinforced Taiwan’s determination to gain greater international support, and prodded other governments, including the United States, to express and provide that support. In August 2022, for instance, the administration of US President Joseph R. Biden opened formal trade negotiations with Taiwan. 

It does not appear that Xi perceives or accepts the counterproductive nature of his Taiwan policy. He seems committed to coercion, viewing this as his best method of preventing Taiwan’s drift toward Washington. One reason could be that appearing “tough” on Taiwan bolsters his domestic political stature. Another could be that other options are unappealing. If he is unwilling to make compromises with the Tsai administration, he may see dialogue as a dead end.

Once Xi secures his third term, the big question is how much pressure he will bring to bear on Taiwan. Beijing’s reaction to the Pelosi visit offers contradictory clues. On the one hand, Beijing’s military exercises crossed red lines, most of all in the People’s Liberation Army’s decision to blockade the island. This move suggests Xi may be aiming to create a “new normal” in the Taiwan Strait, in which the Chinese military exerts greater control in the waterway and intensifies its harassment of Taipei’s government. On the other hand, Beijing restrained its military from taking certain risks during those exercises. For instance, no planes entered Taiwan’s airspace. That indicates that Xi, fearing actual conflict, may place limits on how drastically he wishes to alter the status quo.

Either way, the emerging cycle of reaction and counterreaction is potentially creating a downward spiral into heightened tensions in the Taiwan Strait. Barring some unforeseen and tectonic shift in policy in Washington and Taipei, Beijing’s more assertive attitude to the Taiwan issue will likely continue in Xi’s third term. This raises the frightening prospect of conflict over Taiwan, either accidentally—such chances increase with the intensity of Beijing’s military harassment—or by design. The centralization of power in Xi Jinping raises the possibility that he could decide a military solution to the Taiwan problem is necessary perhaps to bolster his own political position. With the highest ranks of the Chinese government stacked with loyalists, he could encounter little internal opposition to such a drastic course of action.

That is speculation, of course, but the direction of Xi’s Taiwan policy is transforming the risk of war over the fate of the island from an outside possibility to a more urgent danger to the security and stability of East Asia.

Xi and the world

The more aggressive position on Taiwan is part of a much wider shift in China’s foreign policy under Xi’s guidance. When Xi took power a decade ago, the United States was still China’s partner. Since then, Xi has transformed Washington into China’s chief adversary. The finger-pointing goes both ways as to which side is to blame. Xi’s government admits to no responsibility for soured relations, but it is indisputable that Xi’s policies have played an outsized role in causing the US-China rift. His predatory industrial programs, aggressive pursuit of contested territorial claims in the South China Sea, and his friendship with Russian President Vladimir Putin, which persists despite Russia’s invasion of Ukraine, have all contributed to strained relations. 

Xi is not likely to become any friendlier. He appears to believe the United States is determined to suppress China’s rightful ascent into a global power. The Chinese political and academic elite seem to be convinced that the US is in inexorable decline, and Washington is trying to “keep China down” in order to cling to its wobbly hegemony. This thinking permeates many of Xi’s foreign and economic policies. His “self-sufficiency” drive is meant to protect China from what he sees as Washington’s nefarious designs to use the United States’ economic heft and technological advantages to restrain China’s economic advance. His partnership with Putin is designed to decrease his economic reliance on the West and enlist Moscow as a partner in his quest to undermine the US-led world order. Xi’s latest diplomatic projects, the Global Security Initiative and Global Development Initiative, aim to replace the norms and rules of the current liberal order with a system more favorable to autocratic regimes and the expansion of Chinese power. Barring a dramatic turn in US policy to capitulate and align with Beijing’s interests, none of these efforts to overthrow Pax Americana are likely to change in Xi’s next term. The more powerful Xi becomes, the more they may intensify.

To many inside and outside of China, Xi’s anti-US sentiments have set the stage for a dangerous gamble. Still relatively poor and far behind in technological development, China needs friendly relations with the United States and its allies and partners in Europe and the Asia-Pacific to continue to achieve economic progress. However, Xi probably does not see it that way. An adversarial relationship with the United States is, in many respects, beneficial to Xi’s political standing, especially at home. The narrative of Xi’s personality cult is that he is the man with the will and the wisdom to attain the “Chinese dream” of national rejuvenation. Too long a victim of the West, China will now seize its moment to overcome its enemies and restore its greatness. This epic drama requires a villain and the United States (along with its allies, especially Japan) can play that role nicely. It is clear that Xi wants the Chinese public to despise and distrust the United States. Chinese media has become a constant anti-US propaganda machine, painting Washington as resolutely hostile, and US society as violent, racist, and unjust. By pushing such messaging, while raising the Great Firewall ever higher to constrain the flow of outside information into the country, the Chinese state is attempting to reshape and control Chinese public opinion about the United States. Xi, as the star of this show, is often portrayed as standing firm against the big, bad Americans, finger-wagging the US president, for example, on Taiwan. Around the world, too, Xi can portray China as a better alternative to the (supposedly) decaying and irresponsible United States, and himself as the statesman to usher in a new era. By pursuing this course, Xi aims to rally other nations already hostile to Washington and transform himself into the leader of a new global order, with China at its apex.

This narrative may serve Xi’s political interests, but it does not bode well for his relations with Washington since it makes serious dialogue or compromise almost impossible. The main goal of Beijing’s current diplomacy appears to be gaining compliance from other governments to align with Xi’s goals, and it often degenerates into threats, warnings, and demands. Much of the fiery rhetoric may, again, be directed at a domestic audience to bolster Xi’s credentials as a diehard defender of the nation. It may also be motivated by Beijing’s growing conviction of the inevitability of its rise and belief that eventually, even the most recalcitrant nations will have to submit. Whatever the cause, five more years of Xi’s foreign policy almost certainly means five more years of increasing conflict with many of the world’s major economic and military powers. This includes not only the United States and its allies, but also emerging nations that feel threatened by Beijing’s aggressiveness, such as India and Vietnam.

Conclusion

In his decade at China’s helm, Xi Jinping has brought about drastic changes in Beijing’s governance, economic agenda, and foreign policy. There is little evidence at this point that he intends to alter course. Instead, there is more reason to believe that the more entrenched Xi becomes in his position, the more aggressively he will pursue his agenda at home and abroad. The only caveat is whether current poor conditions in China—a slowing economy, the strains of zero-COVID, and greater tensions with the international community—have weakened him enough to allow other factions with the Communist Party to place officials into senior positions who can check his power and alter his policy program. That will not be known until the upcoming Congress. Such an outcome is certainly possible. Yet policymakers around the world would be wise to approach the twentieth Party Congress with the assumption that Xi stays in charge and in control.

Working under this assumption means the world’s China watchers will need to adjust the way in which they understand the process of policymaking in Beijing. To an increasing degree, Beijing’s decisions will be Xi’s decisions. Determining what the Communist government will or will not do is becoming a process of figuring out what fits with Xi’s personal political calculations and ideology. As shown by zero-COVID or “wolf warrior” diplomacy, Xi will make policy choices that may be beneficial to his own political standing, or helpful for his vision for China’s future, but harmful to the country in many other respects. In a system heavily dominated by Xi loyalists, the degree of policy debate may narrow, creating “echo chamber” conditions that shield Xi from the real impact of his choices and the information he requires to make sound decisions. 

It is also likely that Xi’s third term will see a continuation, and possibly an intensification, of the trends already underway in Chinese policy. In foreign affairs, that means greater hostility to the United States and its global allies, closer relations with Russia and other autocratic regimes, more aggressive pursuit of regional territorial claims and other interests, and heightened tensions over Taiwan. With the economy, Xi will almost certainly remain cool to liberalization and persist with state-led industrial programs, the fixation on self-reliance, and heavier control of the private sector. In general, Xi’s third term will likely see rising nationalism and continued decoupling from the world in business, information, culture, education, and even personal exchanges. 

Perhaps the biggest unanswered question about Xi’s third term is: what happens five years from now, when China is again due for another leadership shuffle? Having flushed the party’s collective governance system down the political toilet, Xi has created uncertainty over how leaders will be selected and how the country will be governed in the future. Can the system of collective rule be reestablished? Or will Chinese politics become a contest of competing strongmen? 

A case can be made that Xi, by holding onto power, has merely restored China to its usual norm. The era of collective leadership can be seen as a brief aberration in a political environment more often dominated by an individual. At the same time, many in the political and business elite in China likely remain wary of a reversion to the days of Mao, when the fate of the nation rested in the unreliable hands of a single leader. Perhaps pressure will mount in coming years to restore greater balance within Chinese governance. Or perhaps Xi will manage to quash any further resistance and rule for life. After four decades of walking a fairly predictable path, Xi is sending China into the unknown.

The Global China Hub researches and devises allied solutions to the global challenges posed by China’s rise, leveraging and amplifying the Atlantic Council’s work on China across its fifteen other programs and centers.

1    For an explanation of how the congress works, see “Raising the Curtain on China’s 20th Party Congress,” https://asiasociety.org/policy-institute/raising-curtain-chinas-20th-party-congress-mechanics-rules-norms-and-realities-power.
2    Deng Xiaoping, “On the Reform of the System of Party and State Leadership,” Aug 18, 2980, in The Selected Works of Deng Xiaoping, Vol. 2   https://dengxiaopingworks.wordpress.com/2013/02/25/on-the-reform-of-the-system-of-party-and-state-leadership/
3    Nis Grunberg, testimony before the U.S.-China Economic and Security Review Commission, Jan. 27, 2022. https://www.uscc.gov/sites/default/files/2022-01/Nis_Gr%C3%BCnberg_Testimony.pdf
4    Jeremy Mark and Michael Schuman, “China’s Faltering ‘Zero-COVID’ Policy: Politics in Command, Economy in Reverse,” Atlantic Council, May 11, 2022 https://www.atlanticcouncil.org/in-depth-research-reports/report/chinas-faltering-zero-covid-policy-politics-in-command-economy-in-reverse/
5    Howard Wang, “’Security Is a Prerequisite for Development’” Consensus Building Toward a New Top Priority in the Chinese Communist Party,” Journal of Contemporary China, Aug. 7, 2022 https://www.tandfonline.com/doi/abs/10.1080/10670564.2022.2108681
6    Xi Jinping, “Understanding the New Development Stage, Applying the New Development Philosophy, Creating a New Development Dynamic,” Quishi, July 8, 2021 http://en.qstheory.cn/2021-07/08/c_641137.htm
7    Xi, “Understandng the New Development Stage.”

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How Niger’s safety net helps its most vulnerable citizens thrive amid crises https://www.atlanticcouncil.org/blogs/africasource/how-nigers-safety-net-helps-its-most-vulnerable-citizens-thrive-amid-crises/ Fri, 07 Oct 2022 13:07:10 +0000 https://www.atlanticcouncil.org/?p=573197 The World Bank's Wadata Talaka safety-net partnership program with Niger aims to empower women in the country and protect its human-capital gains in the face of overlapping shocks.

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Nearly every country around the world is grappling with more than one crisis: the still-simmering pandemic and continued vulnerability to future health emergencies; historic spikes in food insecurity, exacerbated by supply shortages arising from the war in Ukraine; fragility, conflict, and violence; and the steadily rising tide of climate change’s assaults on the environment.

Neutralizing even one of these crises can be confounding and perilous. Some countries, unfortunately, face them all at once, fighting on multiple fronts. That usually keeps them from attending to the longer-term task of giving people the knowledge, skills, access to health care, and opportunities they need to live out their full productive potential. Investing in resilient, shock-responsive systems is critical to protect human-capital gains and improve resilience to future shocks.

Niger is an example of a country that faces many complex and interconnected challenges. Shocks and crises are increasingly frequent and overlapping in Niger, disrupting efforts to sustain broad-based growth, build human capital, and reduce poverty. Regional instability has led to the displacement of families and the closure of schools, threatening social stability and increasing insecurity; that, in turn, complicated Niger’s efforts to respond to the COVID-19 pandemic and worsened the food insecurity that is now affecting more than 4.4 million of the country’s people. Climate shocks have triggered localized flooding, while steady rises in temperatures threaten the more than 80 percent of Niger’s citizens who depend on agriculture for their nourishment and livelihoods.

The government of Niger is determined not to lose any ground in its steady climb to protect and invest in all its citizens by pressing ahead with programs and reforms that are having transformational impact on people’s lives. A great example of this is the Wadata Talaka safety-net program, a partnership between Niger and the World Bank that focuses on poverty reduction, resilience building, and women’s empowerment. The program provides monthly cash transfers to extremely poor households to smooth their consumption expenditures and improve their ability to cope with shocks. It also provides “economic inclusion” support—life and micro-entrepreneurship skills training, coaching, and support to village savings groups—and helps poor children get essential mental stimulation in their early years. Such programs can respond quickly to help poor and vulnerable families prepare for, cope with, and adapt to shocks such as the COVID-19 pandemic: As the virus spread, the program expanded to four hundred thousand households to protect them from the pandemic’s adverse economic consequences. The program is well-placed to assist poor households with rising food insecurity and climate shocks.

A successful response will need to include supporting women and innovation. Because women are the primary beneficiaries of Wadata Talaka, the program is an important vehicle for their empowerment. Evaluations of the economic inclusion program show that in the eighteen months since it began, it improved household consumption and food security. The total income of women beneficiaries has increased (by 60 to 100 percent, much of it from non-farm businesses), and there is strong evidence of gains in their mental health and social wellbeing.

To develop such systems reaching the poorest and most vulnerable, countries will need strong social registries and good enrollment, delivery, and payment systems, often leveraging technology. The government of Niger is fully committed to these efforts. For example, responding to climate change, Wadata Talaka was the first program of its kind in West Africa to use satellite data to quickly anticipate drought hotspots and provide emergency funds more quickly than usual (three months ahead of the traditional response) to help people before they entered the lean season. Research is currently underway to measure the impact of that speed.

At a time when countries are forced to contend with the ebb and flow of shocks like climate change, pandemics, conflict, or food price increases, investments in social protection systems are more critical than ever. Niger’s programs serve as an example of just how impactful such adaptive systems can be.


Ouhoumoudou Mahamadou is the prime minister of Niger.

Mamta Murthi is vice president for human development at the World Bank.

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Aviso LatAm: October 1, 2022 https://www.atlanticcouncil.org/content-series/aviso-latam-covid-19/aviso-latam-october-1-2022/ Sat, 01 Oct 2022 14:04:44 +0000 https://www.atlanticcouncil.org/?p=571722 57 percent of the English and Dutch-speaking Caribbean are food insecure

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​​​​​What you should know

  • Brazil: Incumbent Jair Bolsonaro and former President Luiz Inácio Lula da Silva will face off in presidential elections this Sunday, October 2. See more below.
  • 4.1 million: The number of people facing food insecurity in the English and Dutch-speaking Caribbean. This amounts to 57 percent of the total population.
  • Diplomatic relations: Colombia and Venezuela reopened their border to vehicles transporting goods following several years of politically-induced closure.

Expert take: Looking ahead at Brazil’s presidential election

From state-level representatives to Congressional members to the next president, Brazilians have their work cut out for them this Sunday. Brazil’s economy is rebounding but new challenges still lie ahead. Political leadership and the innovative economic policies that come with it will be vital to navigating these challenges, particularly in an uncertain and evolving global context.

Clouded by an extremely polarizing political campaign, polls suggest the contest will be between former President Luiz Inácio Lula da Silva and incumbent President Jair Bolsonaro. On the economic front, President Bolsonaro proposes a continuation of his economic priorities, doubling down on a business-friendly, open-market economy. On the other hand, former President Lula will adopt a pragmatic approach with a focus on a social agenda, targeting hunger and poverty levels. The challenge, regardless of who wins on October 2 or October 30 (if there is a second round), is in Congress, which will likely be highly fragmented. In that regard, the pandemic will continue to play a role in politics with the economy – and fiscal responsibility – at the top of the priority list for the next administration.

Monitoring economic headwinds and tailwinds in the region

  • Honduras: The Central American Bank for Economic Integration (CABEI) issued a $200 million loan in order to mitigate fuel price pressures.
  • Brazil: Despite a boost in activity as COVID-19 infections drop worldwide, real GDP growth projections for 2022 and 2023 are set to slow from 2.5 percent to 0.8 percent, respectively.
  • Cuba: Hurricane Ian made landfall as a Category 3, knocking out power for the whole island. This comes after several months of intermittent blackouts due to failing power generators. 
  • Mexico: AMLO announced an agreement with companies to freeze prices on key foods as the country battles inflation of 8.8 percent. 
  • Paraguay: Officials met with the US for the first trade and investment council under their bilateral Trade and Investment Framework Agreement (TIFA) to discuss ways to deepen trade ties along intellectual property, agriculture, and the digital economy.  
  • Ecuador: The government announced it reached a debt agreement with Chinese lenders, delivering $1.4 billion in debt service relief over the next three years. 
  • Argentina: The International Monetary Fund (IMF) reached an initial agreement on reviewing the country’s debt restructuring, and is set to make $3.9 billion available upon completion. 

In focus: LAC-Europe Relations

Several meetings covering transatlantic relations with Latin America and the Caribbean convened on the sidelines of last week’s United Nations General Assembly, including the Fifth Forum on Latin America, the United States, and Spain in the Global Economy, and AALAC’s side event “From Ukraine to the Americas: Fortifying recovery against global shocks.”  

Spain’s Prime Minister, Pedro Sánchez, spoke with Colombian president Gustavo Petro about issues affecting both Latin America and Spain, including climate change and supply chains. Spain is set to hold the next presidency of the European Union, and hopes to revitalize EU-LAC ties. At the Atlantic Council’s event, Josep Borrell, Vice President of the European Commission, spoke about the EU’s willingness to work with LAC on key issues worsened by the Russian invasion of Ukraine, such as food insecurity and gas shortages. Both discussions focused on the importance of relocating supply chains to ensure stability. 

Health + Innovation

  • Argentina: A laboratory manufacturing Russia’s Sputnik V COIVD-19 vaccine announced it would halt the production line to target other types of diseases.
  • PAHO: Ministers of Health and other high-level authorities from around the Americas met on September 26 for the organization’s 30th Pan American Sanitary Conference. At the conference, Dr. Jarbas Barbosa da Silva Jr. of Brazil was elected new Director for PAHO.
  • COVID-19: Life expectancy in LAC for 2022 fell 2.9 years, from 75.1 years in 2019 and 72.7 years in 2021.

Geopolitics of vaccine donations: US vs. China

  • The United States outpaces China in its donations of COVID-19 vaccines to Latin America and the Caribbean, with Colombia and Mexico topping the list. The region has received roughly 52 percent of all US COVID-19 vaccine donations. To learn more, visit our COVID-19 vaccine tracker: Latin America and the Caribbean.

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Roberts Reviews China Books https://www.atlanticcouncil.org/insight-impact/in-the-news/roberts-reviews-china-books/ Fri, 23 Sep 2022 19:58:11 +0000 https://www.atlanticcouncil.org/?p=569668 On September 22, IPSI Senior Fellow Dexter Tiff Roberts published, “At stake in the U.S.-China rivalry: The shape of the global political order,” in The Washington Post. This is a book review of three China books: Revolution and Dictatorship: The Violent Origins of Durable Authoritarianism, by Steven Levitsky and Lucan Way; Xi Jinping: The Most […]

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On September 22, IPSI Senior Fellow Dexter Tiff Roberts published, “At stake in the U.S.-China rivalry: The shape of the global political order,” in The Washington Post. This is a book review of three China books: Revolution and Dictatorship: The Violent Origins of Durable Authoritarianism, by Steven Levitsky and Lucan Way; Xi Jinping: The Most Powerful Man in the World, by Stefan Aust and Adrian Geiges; and Surveillance State: Inside China’s Quest to Launch a New Era of Social Control, by Josh Chin and Liza Lin.

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Aviso LatAm: September 17, 2022 https://www.atlanticcouncil.org/content-series/aviso-latam-covid-19/aviso-latam-september-17-2022/ Sat, 17 Sep 2022 14:52:12 +0000 https://www.atlanticcouncil.org/?p=567418 US and Mexico convene second high-level economic dialogue

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​​​​​What you should know

  • US-Mexico relations: The second High-Level Economic Dialogue between the two countries met on Monday, after it was relaunched last year. More information below.
  • Chile: On September 4, citizens rejected a proposed constitution which would have significantly altered its social and economic landscape. 
  • SME: Our latest publication, Unlocking Small and Medium-Sized Enterprise Potential in Latin America and the Caribbean outlines practical, forward-looking policy recommendations needed for SMEs to fully become engines of socioeconomic prosperity.
  • UNGA 77: As leaders from 193 member states address pressing challenges, fortifying recovery against global shocks should be among top priorities. Next Monday, September 19 at 12:00 ET, tune in to our special event featuring the European Commission’s Vice President Josep Borrell, Spanish Foreign Minister José Manuel Albares, US Under Secretary of State for Economic Growth, Energy and Environment Jose W. Fernandez, Guyanese Foreign Secretary Robert M. Persaud, and more.

Monitoring economic headwinds and tailwinds in the region

  • El Salvador: One year after adopting Bitcoin as legal tender at market highs, the crypto currency has lost over half its value.
  • Colombia: The state oil company, Ecopetrol, asked regulators to temporarily halt fracking projects. President Petro promised to end fracking and is making a fourth legislative attempt to do so.  
  • Brazil: Growth in services and industry led the country to exceed its second-quarter forecast by a third, with GDP growing at 1.2 percent
  • Belize: The government will host a technical mission from Taiwan to support the sustainable development of Belize’s blue economy including fishery resources.
  • Barbados: The government hosted the inaugural Africa-Caribbean trade and investment forum on September 1, in a determined effort to formalize trade, air, tourism, and other links between the two.
  • Argentina: “Superminister” Massa received a $1.2 billion loan proposal from the Inter-American Development Bank (IDB) as he visited Washington to meet with lenders. Inflation is expected to reach 95 percent this year. 

In focus: US-Mexico High-Level Economic Dialogue

US officials, including Secretary of State Blinken and Secretary of Commerce Raimondo, met with their Mexican counterparts Secretary of Foreign Relations Ebrard and Secretary of Economy Clouthier, in Mexico City on September 13. Conversations focused on continental integration, strengthening supply chains, and economic opportunities between the US, Mexico, and northern Central America. The delegations paid special attention to electric vehicle production, information technology, and improving border infrastructure. 

Notably absent from the main discussion points was the ongoing dispute over Mexico’s energy policy, which the US and Canada raised through USMCA in July. While both the US and Mexico signaled optimism after the meeting, no official advances have been announced. The parties have until October 3 to reach an agreement before a formal panel is convened to evaluate the dispute.  

Health + Innovation

  • Monkeypox: 16 percent of more than 50,000 confirmed cases worldwide were registered in Latin America the first week of September.
  • World Health Organization: As the number of reported deaths from COVID-19 hit an all-time low globally since March 2020, the head of the organization said that the end of the pandemic is now in sight.
  • Jamaica: The government hosted a three-day Caribbean Public Health Agency (CARPHA) conference to share research and insights into the COVID-19 pandemic.

Geopolitics of vaccine donations: US vs. China

  • The United States outpaces China in its donations of COVID-19 vaccines to Latin America and the Caribbean, with Colombia and Mexico topping the list. The region has received roughly 52 percent of all US COVID-19 vaccine donations. To learn more, visit our COVID-19 vaccine tracker: Latin America and the Caribbean.

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Aviso LatAm: September 3, 2022 https://www.atlanticcouncil.org/content-series/aviso-latam-covid-19/aviso-latam-september-3-2022/ Sat, 03 Sep 2022 06:44:00 +0000 https://www.atlanticcouncil.org/?p=562470 LAC's economy is expected to growth 2.7 percent in 2022

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​​​​​What you should know

  •  2.7 percent: The average economic growth expected for Latin America and the Caribbean (LAC) in 2022—a considerable setback from the region’s robust economic recovery in 2021 of nearly 7 percent.
  • Diplomacy: Colombia and Venezuela officially re-established relations.
  • Chile: On Sunday, Chileans will vote to approve or reject a new draft constitution. If approved, the text will replace the 1980 legal charter written under the military government of Augusto Pinochet.

Monitoring economic headwinds and tailwinds in the region

  • Guyana: The economy is expected to grow by 52 percent on the back of oil exploration.
  • Paraguay: President Mario Benítez vetoed legislation to incentivize cryptocurrency mining, citing concerns about its sustainability and value for the economy. 
  • Andes: The Andean Community of Nations (CAN) encouraged Chile, Venezuela, and Argentina to join the bloc at its meeting this month, and accepted Turkey as an associate state. 
  • Argentina: The government announced a program to encourage formalization, allowing workers to maintain their social benefits for a year after shifting from all-cash to official payroll jobs. 
  • Chile: The International Monetary Fund (IMF) issued a $18.5 billion credit line as a precautionary measure against global uncertainty.
  • Brazil: The Fertilizer Congress discussed the impact of the Russian invasion of Ukraine, focusing on its National Fertilizer Plan to reduce dependency on imports and logistical improvements. 
  • Mendoza: The Argentine province’s tax authority began accepting stablecoins – cryptocurrencies pegged to another reference asset – last week as a step towards more digitalization and crypto use in Argentina.   

In focus: India looks for partners in LAC

India’s Minister of External Affairs, Subrahmanyam Jaishankar, visited Paraguay, Brazil, and Argentina last week – the first major Indian trip to the region in nine years. Key areas of discussion included cooperation on trade, defense, and pharmaceuticals. The trip began with Jaishankar opening a new Indian embassy in Asunción and meeting with Paraguayan officials. 

In Brazil, he emphasized the region’s potential as a “business hub” for India while meeting with private-sector organizations, and reached agreements on broadcasting and taxation. At his last stop in Argentina, Jaishankar discussed security collaboration, joint production of material, and the possibility of Argentina acquiring India’s domestic fighter jet. Jaishankar and his Argentine counterpart, Santiago Cafiero, also agreed on hosting bilateral conferences on pharmaceutical production, and explored Argentina’s role in vaccine manufacturing. 

Health + Innovation

 

  • Mexico: COVAX will send 10 million doses of Pfizer COVID-19 shots for children by the end of September.
  • CanSino Biologics: The Chinese pharmaceutical company, which sells a one-dose shot in Mexico, is seeking approval for an inhaled version of the COVID-19 vaccine.
  • Honduras: Spain issued a $70 million loan to fortify the Central American country’s health infrastructure.

Geopolitics of vaccine donations: US vs. China

  • The United States outpaces China in its donations of COVID-19 vaccines to Latin America and the Caribbean, with Colombia and Mexico topping the list. The region has received roughly 52 percent of all US COVID-19 vaccine donations. To learn more, visit our COVID-19 vaccine tracker: Latin America and the Caribbean.

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Aviso LatAm: August 23, 2022 https://www.atlanticcouncil.org/content-series/aviso-latam-covid-19/aviso-latam-august-23-2022/ Tue, 23 Aug 2022 12:57:50 +0000 https://www.atlanticcouncil.org/?p=558922 World Bank deploys $20.7 billion to support LAC

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​​​​​What you should know

  • World Bank Group: In its just-completed fiscal year, the bank deployed $20.7 billion to support LAC as it continues to grapple with economic slowdown, rising inflation, and deepening food insecurity.
  • Argentina: With inflation at 70 percent and rising, Argentina secured a CAF loan of $740 million US for infrastructure and social programs.
  • Mexico: In an effort to strengthen ties, Canada and Mexico launched the first High-Level Economic Dialogue on August 15.

Monitoring economic headwinds and tailwinds in the region

  • Chile: Economists predict a potential recession as the Central Bank’s GDP data came in below expectations in Q2 of 2022.
  • El Salvador: The country shifted from being a net energy importer to a net exporter, due to energy projects on the Lempa River and its membership in the regional energy market Central American Electrical Interconnection System (SIEPAC).
  • Peru: Forecasts showed that the country will cease being LAC’s fastest growing major economy–a title it has held since 2011–as political turmoil undermines government management and investor confidene.
  • Colombia: President Petro proposed higher taxes on top earners, a wealth tax, and an export tax on minerals, with revenue going to reduce the deficit and cover new social spending programs.
  • Dominican Republic: FDI grew 8 percent in the first half of 2022 compared to 2021, and was 20 percent higher compared to 2019. Growth was mainly in tourism, industry, and mining.
  • Cuba: The government is allowing limited foreign investment in wholesalers, and will consider public/private retail ventures, in an attempt to reduce shortages.

In focus: CARICOM and non-tariff barriers

President Irfaan Ali of Guyana and Prime Minister Keith Rowley of Trinidad and Tobago met in Port of Spain ​ahead of Trinidad​ and Tobago’s second Agri-Investment Forum and Expo. Ali and Rowley announced a ​joint task force ​to reduc​e non-tariff trade barriers, a systemic inter-regional issue that limits the free flow of goods between CARICOM governments. This ​task force’s announcement comes on the back of CARICOM’s intent to reduce its food import bill by 2025 by 25% by eliminating such barriers as part of efforts to strengthen food security ​in the region. 

Health + Innovation

  • PAHO: The Organization hosted a regional workshop aiming to strengthen preparedness and response to future respiratory virus pandemics in LAC.
  • Peru: The Supreme Court ruled against mandatory proof COVID-19 vaccinations in the workplace citing violations to workers’ rights.
  • Honduras: The latest recipient of 149,760 COVID-19 vaccine doses through the COVAX mechanism.
  • Brazil: The federal police accused President Bolsonaro of discouraging compliance with pandemic-linked health measures.

Geopolitics of vaccine donations: US vs. China

  • The United States outpaces China in its donations of COVID-19 vaccines to Latin America and the Caribbean, with Colombia and Mexico topping the list. The region has received roughly 52 percent of all US COVID-19 vaccine donations. To learn more, visit our COVID-19 vaccine tracker: Latin America and the Caribbean.

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Aviso LatAm: August 6, 2022 https://www.atlanticcouncil.org/content-series/aviso-latam-covid-19/aviso-latam-august-6-2022/ Sat, 06 Aug 2022 14:00:28 +0000 https://www.atlanticcouncil.org/?p=554457 Mexico to spend $28 billion in programs and subsidies to tame inflation

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​​​​​What you should know

  • Colombia: On Sunday, President-elect Gustavo Petro will be sworn in as the new president.
  • Mexico: The government will have spent $28 billion during 2022 in programs and gasoline and electricity subsidies to tame inflation.
  • Argentina: Sergio Massa was appointed to head a new “super-ministry” created by combining the current Economy, Productive Development, and Agriculture ministries. The previous economy minister lasted less than a month in the role.

Monitoring economic headwinds and tailwinds in the region

  • Brazil: Higher-than-expected growth rates and increasing concerns over inflation are likely to push the central bank to continue raising interest rates.
  • Trinidad and Tobago: S&P raised its outlook on the country’s bonds from “negative” to “stable” in light of its resiliency against multiple shocks.
  • Panamá: The government announced price controls on 72 food products in response to ongoing protests, with the goal of reducing rising costs by 30 percent. Negotiations with the protestors continue. 
  • Colombia: Incoming Economy minister José Antonio Ocampo said “a great tax reform” was necessary, and pointed to tax evasion as a major concern for his office.   
  • Honduras: A municipal government outside the capital established a “Bitcoin Valley” to train local businesses in using and managing cryptocurrency, joining El Salvador in cryptocurrency experiments.
  • Bolivia: Minister of Finance and Economy attributes a low 1.2 percent inflation in the first half of 2022 to subsidies encouraging agricultural production and on fuel.  

In focus: Alliance for Development in Democracy expands work

Last week, the members of the Alliance for Development in Democracy – The Dominican Republic, Panamá, and Costa Rica – announced a new Consultative Dialogue on Supply Chains and Economic Growth with the United States. This group will work with the private sector to attract nearshoring investments and boost supply chain resiliency. Representatives from the three countries met with the US Chamber of Commerce to provide input on the Chamber’s work on supply chains.  

The founding members and the United States also celebrated the entry of Ecuador into the project. Ecuador announced its accession at the Ninth Summit of the Americas in June. 

Health + Innovation

  • Monkeypox: Over 1,395 cases have been confirmed across LAC, accounting for 6 percent of the total global count.
  • COVID-19: Reported cases across the region have decreased by 41 percent week-on-week as of August 4.
  • Donations: To date, the United States has donated over 70 million vaccine doses to 30 countries across the Western Hemisphere.

Geopolitics of vaccine donations: US vs. China

  • The United States outpaces China in its donations of COVID-19 vaccines to Latin America and the Caribbean, with Colombia and Mexico topping the list. The region has received roughly 52 percent of all US COVID-19 vaccine donations. To learn more, visit our COVID-19 vaccine tracker: Latin America and the Caribbean.

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Aviso LatAm: July 23, 2022 https://www.atlanticcouncil.org/content-series/aviso-latam-covid-19/aviso-latam-july-23-2022/ Sat, 23 Jul 2022 13:11:26 +0000 https://www.atlanticcouncil.org/?p=550137 The price of wheat increased 90 percent in Argentina and Chile amid rising food inflation

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​​​​​What you should know

  • Food prices: In May, the price of wheat increased 90 percent year-on-year in Argentina and Chile, amid rising food inflation and the ongoing war in Ukraine.
  • US-Mexico: President Biden and President Andres Manuel Lopez Obrador met last week and committed to facilitating trade between their countries and relaxing trade costs.
  • Brazil: Congress approved a $7.6 billion spending bill that President Bolsonaro hopes will lift his lagging re-election hopes.

Monitoring economic headwinds and tailwinds in the region

  • Costa Rica: President Chaves resumed the process to join the Pacific Alliance trade bloc. He hopes it will open Costa Rica to the global economy and trade more with China
  • Canada: After raising concerns about Mexico’s business environment for mining, energy, and biotechnology sectors, Canada is exploring a possible Canada-Mexico High Level Economic Dialogue. 
  • Mexico: The US Trade Representative expressed concerns over Mexico’s energy reforms appearing to violate USMCA, and will request formal consultations on the dispute.  
  • Panama: Protests against rising prices, especially for fuel, continued to block portions of the Pan-American Highway.
  • Peru: A forecasted 3.6 percent growth continues, despite plummeting copper prices and global economic uncertainty. 
  • Cuba: Periodic blackouts continue due to lack of capacity in the country’s power grid, weakened by lack of maintenance, fires at generators, and high fuel prices. 
  • Colombia: The incoming head of the national tax and customs agency, DIAN, said that President-elect Petro’s proposed tax reform will raise $10.9 billion annually.
  • Chile: The Central Bank stepped in to support the nation’s currency after it plummeted to a record low, fueling inflation. Read more below.

In focus: Chile’s economy

While Boric’s newly appointed government faces plummeting approval rates, Chileans are struggling to cover the costs of soaring food and energy prices. In the last month, the Chilean peso lost more than 17 percent of its value against the dollar and its most important export—copper— faced an international price drop of 30 percent.    

On July 18, a $25 billion liquidity injection came into effect, and is expected to last until September. The hope is that the injection will contain the fall of the peso and bring stability to local markets. Thus far it has worked – the announcement boosted the peso, which closed with a 7.8 percent gain last Friday. The government has announced it will continue monitoring the situation given the challenging domestic and international context as well as Chile’s limited foreign exchange reserves.   

Health + Innovation

  • Antigua and Barbuda: Minister of Health Sir Molwyn Joseph advised governments in the Caribbean to add the COVID-19 vaccine to the regime of regular immunizations for children.
  • Brazil: SINOVAC, a Chinese COVID-19 vaccine, was authorized for emergency use in children between 3 and 5 years old.
  • Omicron: The Pan-American Health Organization (PAHO) warned of the growing number of COVID-19 cases driven by BA.4 and BA.5 subvariants despite overall cases decreasing in the Americas.
  • PAHO: Director Carissa F. Etienne announced a three-step plan to work with member countries to bolster regional capacity to manufacture vaccines and medical tools.

Geopolitics of vaccine donations: US vs. China

  • The United States outpaces China in its donations of COVID-19 vaccines to Latin America and the Caribbean, with Colombia and Mexico topping the list. The region has received roughly 52 percent of all US COVID-19 vaccine donations. To learn more, visit our COVID-19 vaccine tracker: Latin America and the Caribbean.

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Reality Check #13: Great-power competition threatens climate disaster response https://www.atlanticcouncil.org/content-series/reality-check/reality-check-13-great-power-competition-threatens-climate-disaster-response/ Fri, 22 Jul 2022 14:17:12 +0000 https://www.atlanticcouncil.org/?p=549390 Today’s military planners must contend with two potentially conflicting demands: growing requirements for the US military to respond to climate-driven disasters and the effort to restructure the force for great-power competition.

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Key points

  • The US military, particularly the National Guard, is instrumental in responding to natural disasters in the United States. As climate change increases the severity and frequency of major disasters, the unique capabilities of the military to conduct disaster response will be in even higher demand.
  • The Biden administration’s shifting focus to great-power competition could draw resources and attention away from improving domestic disaster response capabilities, even as these requirements become increasingly urgent. A significant amount of materiel and units need to be available to ensure that effective disaster response can be carried out domestically. Large-scale deployments abroad could endanger national disaster response and ultimately reduce the ability of the United States to successfully engage in future conflicts.
  • The administration should link the planned National Climate Strategy to the National Security Strategy, avoid double-counting units in force planning, develop clear guidelines for when military support is needed for domestic disaster assistance and when it can be withdrawn, and ensure that the National Guard is empowered to train for disaster response.

What’s the issue?

Climate change poses a fundamental threat to US national security, according to the Department of Defense (DoD), the Department of Homeland Security, and others. A recent National Intelligence Estimate cautioned that climate change will “exacerbate geopolitical tensions, social instability, and the need for humanitarian aid” around the globe. In addition to heat waves, droughts, flooding, and ocean acidification, the United States will face larger, more frequent, and more severe wildfires and hurricanes.

Although policy makers’ awareness of the impacts of climate change has grown, US leaders pay less attention to the more immediate burdens imposed on the US military by climate-driven disasters. In 2019, the National Guard logged more than 2.1 million days supporting state and federal homeland missions, responding to sixty-three natural disasters—including seven hurricanes or tropical storms, nineteen floods, twenty winter storms, and twelve fires. In 2020 (the most recent year for which data are available), the Guard spent 10.9 million days responding to various emergencies, which included running a large portion of the country’s COVID-19 response. Battling summer blazes has become a yearly routine for thousands of National Guard servicemembers: in the last five years, the Guard’s personnel requirements for fire suppression have increased more than tenfold. In 2021, fires in the western United States required 170,000 person hours of firefighting by the National Guard, up from 14,000 person hours just five years earlier. Military aircraft, which play a substantial role in aerial firefighting, are being called upon more and more often as US wildfires become more frequent and intense. Hurricanes, which are increasing in strength due to climate change, have also required major mobilizations. In response to Hurricane Sandy in the fall of 2012, 24,000 DoD personnel were mobilized, a larger force than the active-duty military of Norway. Even optimistic forecasts predict that hundreds of thousands of refugees will seek asylum in the United States in the face of climate disasters in Latin America; active-duty units have already been diverted to support border control efforts and help process refugees.

Today’s military planners must contend with two potentially conflicting demands: growing requirements for the US military to respond to disasters and the effort to restructure the force for great-power competition.

Amidst the expanding need for military capabilities at home, the military’s responsibilities are expected to expand even further abroad because of climate change. According to a recent DoD climate report, civil authorities will require increased military support from Northern Command and Indo-Pacific Command in response to climate threats in the near future.

Today’s military planners must contend with two potentially conflicting demands: growing requirements for the US military to respond to disasters and the effort to restructure the force for great-power competition. In the Interim National Security Strategic Guidance, President Joe Biden made clear that he would continue shifting the focus of US forces to potential conflict with China and Russia, writing “In the face of strategic challenges from an increasingly assertive China and destabilizing Russia, we will assess the appropriate structure, capabilities, and sizing of the force. . . ” The military challenges posed by China and Russia are immense in their own right, but they cannot be accurately evaluated without considering the omnipresent and growing needs at home for US military capabilities.

Why does it matter?

The readiness of US forces and the ability to maintain the security and productivity of the homeland are critical factors for any and all future conflicts. Policy makers plan for both wars and disasters under the assumption that military resources will be available for such efforts. However, these plans fail when expected resources are otherwise deployed. For example, firefighters in Oregon usually rely on air support from military Chinook helicopters, but during the massive summer wildfires of 2021, these aircraft were 7,000 miles away, participating in the evacuation of Afghanistan, leaving the firefighting response dangerously under-resourced. Conversely, hundreds of active-duty soldiers, including mechanized infantry, have been called upon to fight wildfires in California. If the United States was engaged in a major war, military officials would have to make a choice: reduce warfighting capacity by tasking military resources to disaster response or face major domestic disruption by deploying disaster-response resources overseas.

Compounding the challenge of both responding to disasters and overall readiness is the burden posed by the immediate effects of climate change. The US Navy has for years been raising the alarm that their operations are threatened by rising sea levels, with one report identifying 128 US naval bases under threat and eighteen likely to be fully submerged by 2100, including the Navy’s largest base, Naval Station Norfolk. In 2019, 30 percent of the US Air Force’s F-22 Raptor fleet had to be relocated, with four of the planes severely damaged, after a category five hurricane hit Tyndall Air Force Base in Florida. Almost every building on the base was damaged, and 70 percent had to be bulldozed. A 2019 after action “fire season” review by the Readiness Division at Fort Wainwright in Alaska found that wildfires had prevented critical training from taking place at the base, with two Pacific Air Forces fighter squadrons unable to conduct important exercises in July 2019. And In April of this year, a massive fire consumed 15 percent of the Army’s Fort Hood, requiring thousands of hours of firefighting by military personnel. Less than a month later, Joint Base San Antonio had to be evacuated due to a large fire. Rising sea levels, stronger storms, and increased risk of fires all negatively affect readiness for the military’s primary missions and can harm the military’s ability to provide effective disaster assistance.

What is the solution?

Considering the growing burden from climate change and the challenge of reorienting the military to a focus on great-power competition, policy makers should consider the importance of having units and platforms available for disaster response, as well as ensuring that the US military is prepared to handle a wide range of disaster contingencies. Four specific recommendations are outlined below.

1. Do not discount disaster response in force planning. Policy makers value DoD’s planning and estimates, and these may inform decisions on whether and how to engage in a great-power war. Policy makers should consider that deploying US military units and assets overseas can degrade the ability of the United States to respond to domestic disasters, which can in turn undermine warfighting capabilities. Last year, for example, eight C-130s were deployed for weeks at a time fighting wildfires, flying 945 sorties, with an additional four conventional C-130s required to assist those outfitted to drop fire retardant. Units and assets that could be deployed to fight a major war and are also needed at home to manage the increasing burden of disaster response should not be double counted. Planners should consider changing the primary mission of certain Guard units to disaster response and develop contingencies for replacing those units with civilian volunteers in extreme situations when those Guard units are needed elsewhere. Large-scale deployments abroad, without trained civilian replacements, could endanger national disaster-response and ultimately reduce the ability of the United States to successfully engage in future conflicts.

2. Reemphasize disaster response training for the National Guard. As a central component in US disaster relief, the National Guard should be prepared and empowered to take on the increasing burden of climate-driven disasters. However, changes to the Guard have instead oriented them towards federal missions instead of state-focused disaster relief, with one former J3 Functional Advisory Council Chairman saying in an interview, “The Guard without the State nexus has transformed into the Army Reserve.” Recently, the Chief of the National Guard Bureau affirmed this transformation is purposefully occurring, stating, “We’re here to fight and win our nation’s wars. At the end of the day, that’s why the National Guard exists.” The training priorities for Guard units have commensurately shifted, with emphasis placed on federally required training (behavioral and policy-driven training), requisite readiness periods (such as the Army Combat Fitness Test and Basic Marksmanship), and individual and collective training, leaving little time and money for domestic mission training. This leaves Guard units far less able to conduct important trainings, such as with state’s search and rescue teams, and less prepared for the types of missions they will be increasingly called upon to accomplish.

3. Consider force posture in the National Climate Strategy. The Biden administration had planned to release a national climate strategy this year, but congressional politics appear to have upended those plans. Although policy makers’ focus on the NCS has understandably centered on how the United States can meet the administration’s emissions reduction goals, the document should also include a clear explanation of how the administration plans to structure disaster response and increase capabilities and how those plans align with the National Security Strategy and National Defense Strategy. In linking the documents, policy makers should review the NATO Climate Change and Security Action Plan, which deftly connects climate change with increased security threats and challenges to operation readiness. The NCS should consider how the US government can best leverage the US military for both climate mitigation and disaster response. Clear expectation-setting at the strategic level will help with planning in both DoD and in disaster-response agencies like the Federal Emergency Management Agency (FEMA) and the United States Forest Service (USFS), enabling them to effectively work together to leverage their capabilities. The Modular Airborne Fire Fighting System (MAFFS) program is an example of the importance of interagency coordination: DoD provides the C-130s at the request of the USFS, which manages the MAFFS that the planes are outfitted with to fight fires.

4. Develop guidelines for when military assets can be withdrawn from disaster relief. FEMA, as the lead agency coordinating major disaster response, should develop indicators as part of the National Incident Management System’s National Response Framework for when military assets can be withdrawn from disaster-relief activities and responsibilities handed over to civilian actors. These indicators should be informed by those used in international disaster response and would improve planning and budgeting for disaster-response operations. A streamlined process for rotating units and assets out of disaster zones will help ensure maximum availability for units’ primary missions and reduce costs. The use of 32 USC § 502(f) authorities for National Guard disaster responses, which keep units under state command but are fully funded by the DoD (and can operate under a mission assignment from FEMA, such as during the COVID-19 response), should be limited to avoid the Guard further becoming seen as a standing force that can fully replace the civilian role in disaster management. 

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Lakhani quoted in The Print: Pakistan’s start-up industry is collapsing https://www.atlanticcouncil.org/insight-impact/in-the-news/lakhani-quoted-in-the-print-pakistans-start-up-industry-is-collapsing/ Mon, 18 Jul 2022 13:48:00 +0000 https://www.atlanticcouncil.org/?p=547709 The post Lakhani quoted in The Print: Pakistan’s start-up industry is collapsing appeared first on Atlantic Council.

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Russian-occupied regions of Ukraine at risk from infections and epidemics https://www.atlanticcouncil.org/blogs/ukrainealert/russian-occupied-regions-of-ukraine-at-risk-from-infections-and-epidemics/ Sat, 09 Jul 2022 23:04:46 +0000 https://www.atlanticcouncil.org/?p=545470 Russia’s ongoing invasion of Ukraine and occupation of around 20% of the country has produced a range of major public health challenges that require urgent international attention, writes Ihor Kuzin.

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Around 20% of Ukraine is currently under Russian occupation. Along with the pressing military and human rights issues this creates, Russia’s ongoing invasion has also produced a range of public health challenges that require urgent international attention.

One of the key problems facing the Ukrainian authorities is a lack of access to information. Unfortunately, Ukraine’s Ministry of Health no longer has a comprehensive picture of the medical situation in occupied regions of the country. This makes it difficult to get insights and assess the scale of the healthcare problems in areas under Russian control. Nevertheless, assessments of the available evidence and an awareness of the general situation in Russian-occupied Ukraine can help identify the top priorities for Ukrainian and international healthcare professionals. 

One of the most significant risks comes from the possible spread of pathogens. As temperatures reach seasonal highs throughout July and August, human contact with blood-sucking insects and ticks becomes more common. This often leads to the spread of infectious diseases.

Another major problem is limited access to drinking water. This increases risks posed by contaminated water and also makes it difficult for people in occupied regions of Ukraine to maintain desirable standards of personal hygiene and sanitation. This can cause mass outbreaks of diarrhea, hepatitis A, cholera, and other infections.

Due to Russia’s military strategy of carpet-bombing Ukrainian towns and cities into submission, basic infrastructure has been severely damaged in much of occupied southern and eastern Ukraine. Many areas now have limited access to drinking water, while remaining water supplies are often not subject to normal treatment.

The risk of a cholera outbreak is believed to be particularly high in Mariupol, a Russian-occupied Ukrainian port city in Donetsk Oblast with a pre-war population of almost half a million that was largely reduced to rubble during a brutal Russian siege. According to the Mariupol municipal authorities, the city’s 22 pumping stations were all destroyed during the fighting, while sewage treatment and drainage systems are also unable to function properly. Large numbers of dead bodies remain trapped beneath the rubble and are decomposing, further complicating the city’s precarious healthcare situation.

Stay updated

As the world watches the Russian invasion of Ukraine unfold, UkraineAlert delivers the best Atlantic Council expert insight and analysis on Ukraine twice a week directly to your inbox.

Russia’s invasion has displaced millions of Ukrainians and thrown large numbers of people together in ways that create potential for healthcare emergencies. Concentrations of children with different vaccination status during evacuation procedures risks fueling outbreaks of vaccine-preventable illnesses such as measles and diphtheria.

COVID-19 also remains an issue. Prior to the Russian invasion, only 35% of the Ukrainian population had been vaccinated, representing one of the lowest rates in Europe. A sharp increase in COVID cases could lead to overcrowding in hospitals at a time when healthcare facilities are desperately needed to care for military and civilian casualties. 

Meanwhile, possible delays in the diagnosis and treatment of tuberculosis are a matter of considerable concern. In particular, if patients stop taking their medications due to impaired access to medical care in occupied parts of Ukraine, this can lead to a rise in cases of antibiotic-resistant tuberculosis.

Similarly, people living with HIV cannot afford to stop taking their medications. Skipping doses may lead to the reappearance of strains resistant to treatment which pose a high risk not only to current patients but to those who may contract the disease in the future.

Large numbers of abandoned livestock are further complicating the healthcare situation in wartime Ukraine and increasing the threat from animal-borne diseases. The uncontrolled movement of animals or their undisposed carcasses, as well as the destruction of wildlife habitats, can lead to the spread of pathogens among humans along with wild and domestic animals. 

International support for Ukraine has so far focused on the provision of weapons along with humanitarian aid efforts for those displaced by the fighting. Looking ahead, it is vital that Ukraine’s partners also help to address the growing healthcare issues created by the Russian invasion.

The list of medical items currently required by Ukraine is long. This includes diagnostic kits, rapidly deployable field hospitals, immunobiological drugs for the treatment of the diseases like diphtheria, tetanus, botulism, and malaria, as well as vaccines for routine immunization (including against hepatitis A and cholera), disinfectants, portable water treatment systems, and means for pest control.

In order to establish a healthcare system capable of responding to epidemic risks, the Ukrainian parliament is set to finalize the second draft of a law on public health that features over 850 proposals from MPs and 400 proposals from international experts.

In preparation for the second reading, experts from the WHO, USAID, the Ukrainian Ministry of Health, and the Ukrainian Public Health Center are involved in finalizing the draft law. Considerable revisions remain before this law can be implemented. This sizable task will require further support from the international community.

Ihor Kuzin is Ukraine’s Deputy Minister of Health and Chief State Sanitary Doctor.


Further reading

The views expressed in UkraineAlert are solely those of the authors and do not necessarily reflect the views of the Atlantic Council, its staff, or its supporters.

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Aviso LatAm: July 9, 2022 https://www.atlanticcouncil.org/content-series/aviso-latam-covid-19/aviso-latam-july-9-2022/ Sat, 09 Jul 2022 15:11:00 +0000 https://www.atlanticcouncil.org/?p=545459 14 million people across 13 LAC countries will reach extreme food-insecure status in 2022 amid the ongoing global food security crisis

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​​​​​What you should know

  • Argentina: Economy Minister Martin Guzmán resigned.
  • 79 percent: The share of Latin America and the Caribbean’s (LAC) children whose learning foundation falls short of their current schooling year.
  • 27.9 million: The number of acutely food-insecure people in LAC as of June 2022, a six-fold increase compared to pre-pandemic levels of 4.3 million in early 2020.

Monitoring COVID-19 economic recovery in the region

  • Peru: The Central Bank is expected to raise its interest rate by half a percentage point as inflation hits 25-year high.
  • Mexico: Annual inflation hit a 21-year high in June 2022, suggesting the central bank will have to continue its monetary tightening to take spiraling consumer prices.
  • Brazil: Unemployment fell below 10 percent for the first time since 2016, beating  projections. 
  • Ecuador: Government officials met with indigenous protestors after President Guillermo Lasso lifted a state of emergency and agreed to new spending on fertilizers, health, and education.  
  • Colombia: President-elect Petro nomination of José Antonio Ocampo as finance minister received positive reactions. Ocampo previously served as finance minister, advised centrist candidate Sergio Fajardo, and worked for ECLAC. 
  • Jamaica: The Statistics Institute (STATIN) reported 8.2 percent GDP growth during the 2021-22 fiscal year driven by a boost in tourism and an ease in COVID-19 restrictions.
  • El Salvador: The government’s bitcoin holdings have lost about 60 percent of their presumed value during the recent market plunge. 
  • 15 percent: The share of adults in LAC that made a digital utility payment for the first time since the pandemic outbreak, nearly twice the developing economy average.

In focus: Argentina’s economy

Argentina’s economy minister, Martin Guzmán, resigned on July 3. Guzmán led Argentina’s recent debt negotiations, including its $44 billion restructuring deal with the International Monetary Fund (IMF). His departure also highlights alleged tensions within the governing coalition, including with Vice President Cristina Fernández de Kirchner, who has repeatedly criticized the administration’s economic policies . Argentina faces inflation of over 60 percent and pressure on exchange rates

President Fernández named Silvina Batakis, former economy minister in the provincial government of Buenos Aires and ally of Fernández de Kirchner, as Guzman’s replacement. Debt negotiations scheduled to take place in Paris were cancelled and will be rescheduled in light of the change.  

Health + Innovation

  • Uruguay: A court ruled that the government and Pfizer must disclose the exact components of the COVID-19 vaccine in light of an injunction to halt vaccination among children aged five and over.
  • PAHO: Over 1.6 billion COVID-19 vaccine doses have been administered in member countries, 17 of which have passed the 70 percent target for national vaccination rate. 
  • Peru: A mandatory mask mandate was reinstated amid a fourth wave of COVID-19 infections.
  • Bolivia: Over 2,000 new cases of COVID-19 have been reported since June, the highest number of infections since the fifth wave of the pandemic started last month.

Geopolitics of vaccine donations: US vs. China

  • The United States outpaces China in its donations of COVID-19 vaccines to Latin America and the Caribbean, with Colombia and Mexico topping the list. The region has received roughly 52 percent of all US COVID-19 vaccine donations. To learn more, visit our COVID-19 vaccine tracker: Latin America and the Caribbean.

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COVID-19 and tourism in the Himalayan & Indian Ocean countries of South Asia  https://www.atlanticcouncil.org/blogs/southasiasource/covid-19-and-tourism/ Mon, 27 Jun 2022 18:43:27 +0000 https://www.atlanticcouncil.org/?p=539470 While in 2019 tourism was among the fastest growing sectors in South Asia, the pandemic resulted in billions of dollars in losses across the region. To understand these developments, the South Asia Center brought together a panel of experts to discuss COVID-19 and the future of tourism in the Himalayan and Indian Ocean Countries of South Asia.

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The global tourism industry has been devastated by the COVID-19 pandemic. In South Asia, this impact runs deeply, with the pandemic affecting approximately 47.7 million travel and tourism jobs across the region. Many of these jobs were held by women and vulnerable communities employed in the informal sector.

While in 2019 tourism was among the fastest growing sectors in South Asia, the pandemic resulted in losses of over fifty billion dollars to regional gross domestic product. In particular, the Maldives, Bhutan, Sri Lanka, and Nepal saw between a 70 and 80 percent reduction in tourist arrivals in 2020. Furthermore, the United Nations World Tourism Organization projects a return to pre-COVID arrival levels in 2023 at the earliest, indicating a long recovery for this critical economic sector. 

To explore these issues, the Atlantic Council’s South Asia Center brought together a panel of experts to discuss COVID-19 and the future of tourism in the Himalayan and Indian Ocean Countries of South Asia.   

This program was recorded on June 21, 2022.

Featuring

Dr. Aishath Shakeela
Senior Lecturer
Griffith Business School, Griffith University, Brisbane, Australia

Dr. Manoj Samarathunga
Senior Lecturer
Faculty of Management Studies, Rajarata University of Sri Lanka

Saurav Raj Pant
CEO
National Study Center, Kathmandu, Nepal

Damcho Rinzin
Chief Tourism Officer
Tourism Promotion Division, Tourism Council of Bhutan

Moderated by

Dr. Rudabeh Shahid
Non-Resident Senior Fellow
Atlantic Council’s South Asia Center

The South Asia Center is the hub for the Atlantic Council’s analysis of the political, social, geographical, and cultural diversity of the region. ​At the intersection of South Asia and its geopolitics, SAC cultivates dialogue to shape policy and forge ties between the region and the global community.

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Aviso LatAm: COVID-19 June 26, 2022 https://www.atlanticcouncil.org/content-series/aviso-latam-covid-19/aviso-latam-covid-19-june-26-2022/ Sun, 26 Jun 2022 11:34:00 +0000 https://www.atlanticcouncil.org/?p=541329 14 million people across 13 LAC countries will reach extreme food-insecure status in 2022 amid the ongoing global food security crisis

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​​​​​What you should know

  • Food insecurity: According to the World Food Programme, 14 million people across 13 LAC countries will reach extreme food-insecure status in 2022 amid the ongoing global food security crisis exacerbated by inflation and the war in Ukraine.
  • Colombia: On June 19, Gustavo Petro was elected as the first leftist president ever, marking a shift away from the country’s decades of political traditions.

Expert take: What a Petro administration means for Colombia’s economy

Gustavo Petro’s victory marks a turning point in Colombia, a traditionally conservative country where consecutive governments have focused on tackling insecurity and violence. Though the Colombian economy has bounced back from the pandemic, informality and inequality levels remain high. Nearly half of the population—and nearly 60 percent among the poorest—think the country’s economic outlook is getting worse. Petro’s economic plan includes structural reforms designed to promote a more inclusive and environmentally responsible economy.

President-elect Petro’s fiscal priorities includes a tax reform that would increase tax collections by 5 percent by taxing wealthy landowners and eliminating tax exemptions/benefits for companies. On the energy front, Petro’s plan to ban oil and gas exploration could create a large fiscal vacuum by depriving Colombia of nearly half of its export revenue. Other significant reforms may include extending subsidies for low-income people, making the government the employer of last resort, and land reforms.

A main immediate priority for the incoming administration will be to safeguard Colombia’s economic recovery. Since 2020, increases in unemployment and informality pushed 3.5 million households into poverty. Amid rising food and fuel prices coupled with global supply chain disruptions, inflation rose to 9.2 percent in April—a 21-year high. While Colombia’s economy is set to grow 5.8 percent this year, the fastest among major Latin American economies, Petro will have to navigate a complicated road ahead, especially given a divided Congress likely resistant to radical reforms.

Monitoring COVID-19 economic recovery in the region

  • Ecuador: The Ministry of Energy and Mines declared force majeure to the country’s entire hydrocarbons value chain amid nationwide strikes and protests. Economic loss stands at $17 million since the protests started due to 609 halted oil wells.
  • El Salvador: The value of its $105 million investment in Bitcoin fell by more than 50 percent.   
  • Mexico: AMLO criticized the central bank’s interest rate increases, which are expected to continue next week to curb inflation.
  • Dominican Republic: Economic growth is expected to reach 5 percent in 2022, despite 9.5 percent inflation and nearly $950 million spent on food and fuel subsidies since 2021.
  • Argentina: Wheat harvest costs have risen by 40 percent, driven in part by fertilizer shortages.  
  • Brazil: Inflation reached 11.7 percent in May. The central bank once again increased interest rates by .5 percent while promising further hikes to combat rising prices. 

In focus: Ecuador’s economy

Ecuador’s economy looked strong earlier this month, with the government on track to outperform its deficit guidelines. However, political instability undermined that forecast after the country’s foreign bonds lost nearly 17 percent of their value over the past month.  

Protesters demanded fuel subsidies and a stop to privatization, and mining and oil projects. In addition to protest-induced road closures, demonstrators forced the state oil company to temporarily cease production. In response, President Lasso offered increased payments to the poor, fuel and fertilizer subsidies, and loan forgiveness. 

Health + Innovation

  • 11 percent: The increase in COVID-19 cases in the Americas over the past week. At least 11 countries and territories have yet to reach 40 percent vaccine coverage.
  • Barbados: Prime Minister Mia Mottley is the latest regional leader to test positive for COVID-19.
  • Colombia: President Iván Duque announced that the COVID-19-induced health emergency measure will be lifted as of July 1, 840 days after it was first declared in 2020. 
  • Mexico: Foreign Minister Marcelo Ebrard is the latest Mexican cabinet member to contract COVID-19.

Geopolitics of vaccine donations: US vs. China

  • The United States outpaces China in its donations of COVID-19 vaccines to Latin America and the Caribbean, with Colombia and Mexico topping the list. The region has received roughly 52 percent of all US COVID-19 vaccine donations. To learn more, visit our COVID-19 vaccine tracker: Latin America and the Caribbean.

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Aviso LatAm: COVID-19 June 11, 2022 https://www.atlanticcouncil.org/content-series/aviso-latam-covid-19/aviso-latam-covid-19-june-11-2022/ Sat, 11 Jun 2022 06:06:00 +0000 https://www.atlanticcouncil.org/?p=535177 Biden administration announces new economic framework for Latin America and the Caribbean

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​​​​​What you should know

  • Summit of the Americas: The Biden administration announced a new economic framework  for Latin America and the Caribbean (LAC), focusing on climate change, workers’ rights and supply chains.
  • Food security: Guatemala, Honduras, Nicaragua and Peru will face considerable challenges in the coming months as countries deal with the global impact of the Ukraine crisis on food and fuel prices.
  • ECLAC: The United Nations commission increased its projection for poverty in LAC for 2022 to 33 percent, citing economic disruptions caused by the conflict in Ukraine.

Monitoring COVID-19 economic recovery in the region

  • Colombia: The peso and stock exchange closed higher on May 31, in the first session since the initial round of presidential elections/ Business-friendly construction magnate Rodolfo Hernández advanced to the run-off.
  • Mexico: Financial inclusion levels have declined since 2018 despite a burst of financial startups hoping to ‘bank the unbanked’ and COVID-induced digitalization. Cash still dominates 90 percent of transactions under $25 and 78.7 percent of payments over $25.
  • Ecuador: High commodity prices and returning tourism have boosted the economy, which is on track to meet IMF deficit guidelines. This year’s deficit is expected to be less than 2 percent of GDP, down from 4 percent in 2021 and 7 percent in 2020. 
  • Venezuela: Farmers in Venezuela are missing approximately one third of their fertilizer needs as supplies from Russia are cut off by international sanctions.
  • Regional outlook: The World Bank predicts that growth in LAC will slow to 2.5 percent in 2022 and 1.9 percent in 2023 as input costs rise and economic policies tighten. Expectations in the Caribbean are more favorable, at 6.9 percent for 2022 and 6.5 in 2023.  
  • Argentina: The Fernandez administration suggested a new tax on companies profiting from the impact of the war in Ukraine to reduce the country’s deficit and control inflation.
  • Chile: The Central Bank raised its benchmark rate 75 base points to 9 percent to confront inflation, continuing a trend of increases now amounting to 8.5 percentage points since last July. 

In focus: Americas partnership for economic prosperity

President Biden will use the Summit of the Americas to launch the Americas Partnership for Economic Prosperity, a regional pact to “rebuild… economies from the bottom up and middle out.” The framework will focus on supply chain resilience, confronting climate change, and mobilizing regional investment to renew the “social contract” in the region. It will include $300 million for fighting food insecurity and more cooperation with the Inter-American Development Bank.

According to a White House press release, the Partnership seeks to reduce non-tariff trade barriers by improving customs transparency and regulation. This mirrors last month’s Indo-Pacific Economic Framework for Prosperity, but is likely to disappoint countries like Ecuador and Uruguay, whose free trade agreement (FTA) negotiations with the US have stalled.  

Health + Innovation

  • Pandemic response: Leaders in the hemisphere adopted an “Action Plan on Health and Resilience in the Americas” to help prevent, prepare for, and respond to future pandemic threats and other health emergencies.
  • Uruguay: President Luis Lacalle Poe is the latest regional leader to contract COVID-19 ahead of the Summit of the Americas leaders meeting.
  • Cuba: Officials lifted a two-year mask mandate following a successful vaccination drive that contributed to a sharp drop in cases in the last few weeks.
  • Brazil: People over 50-years old are now eligible for a fourth COVID-19 vaccine shot.

Geopolitics of vaccine donations: US vs. China

  • The United States outpaces China in its donations of COVID-19 vaccines to Latin America and the Caribbean, with Colombia and Mexico topping the list. The region has received roughly 52 percent of all US COVID-19 vaccine donations. To learn more, visit our COVID-19 vaccine tracker: Latin America and the Caribbean.

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Engagement Reframed #7: Defending democracy and countering China requires US and Western support for a beleaguered developing world https://www.atlanticcouncil.org/content-series/engagement-reframed/engagement-reframed-7-defending-democracy-and-countering-china-requires-us-and-western-support-for-a-beleaguered-developing-world/ Thu, 09 Jun 2022 15:46:21 +0000 https://www.atlanticcouncil.org/?p=534888 The war in Ukraine has become a turning point for developing countries, many of whom could give up the gains made in economic growth and reduction in poverty over the past three decades.

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The war in Ukraine, combined with the lingering effects of the pandemic, means that 2022–23 has become a watershed moment for the growing gap between rich and poor countries. Owing to the increased political instability in many regions, the democratic backsliding that has occurred in Africa, Latin America, and other regions throughout the developing world in recent years is likely to intensify. The stakes are high for the West: China will be the default winner unless Western countries do more to support developing countries. Bearing little responsibility for the Russian invasion of Ukraine, the developing world should not be victimized by it. Nor can the West afford to see its own weakening economic growth prospects exacerbated by the collapse of developing economies.

  • At least 107 developing countries—home to 1.7 billion people—are now being threatened by at least one of three crises: food, energy, and/or finance. Sixty-nine countries, or 1.2 billion people, are severely affected by all three crises, according to a report by the Deputy United Nations (UN) Secretary-General. The World Bank now predicts that a quarter of a billion people could be pushed into extreme poverty this year—an upwards revision of 77 million—due to the fallout from the war in Ukraine.
  • The UN’s Food and Agriculture Organization and its World Food Program have also cited the Ukraine war as exacerbating the already steadily rising food crisis with Ukraine unable to export its grain supplies, which account for 12 percent of the planet’s wheat, 15 percent of its corn, and half of its sunflower oil. The Western embargo on Russian oil has stoked market fears about maintaining adequate energy supplies, boosting the global price for energy, even in countries such as the United States, which are not dependent on Russian imports.
  • The flawed international financial system—which is unprepared for the worsening conditions of the Global South—is greatly in need of reform. The increasing costs borne by the developing countries as a consequence of the sanctions and slowdown in global growth could drive an even deeper wedge between advanced and developing economies than that caused by the pandemic. Without efforts by the Biden administration and other Western governments to assuage their growing plight, developing countries risk becoming more dependent on China, even as Beijing has fewer resources to expend on development assistance due to its own economic slowdown.  

A growing debt crisis

Borrowing heavily at low interest rates to handle the health crisis, developing countries are now in the worst possible position while Western central banks raise interest rates, the dollar appreciates at the most rapid rate in years, and inflation is sending the prices of essentials like food and energy beyond easy reach. Sri Lanka recently became the first Asia-Pacific country in decades to default on foreign debt; unfortunately, other developing countries are likely to follow suit.

Having borrowed record amounts to offset the COVID pandemic’s health and social costs, developing countries’ capacity to service their external debt deteriorated during 2020. The external-debt-to-export ratio increased in 121 out of 127 developing countries for which data exist between 2019 and 2020. In 51 countries this indicator stood above 250 percent in 2020, which lies above the risk threshold of 240 percent used by the International Monetary Fund (IMF) for low-income countries in its Debt Sustainability Framework (DSF). Thirty percent of poorest countries’ debt is at variable rates, increasing the exposure to central bank rate hikes, according to the World Bank. Many developing countries are cutting spending in critical areas such as education, threatening their long-term economic growth.

Countries that appear vulnerable to a sudden crisis, according to the UN Conference on Trade and Development (UNCTAD), due to a combination of large rollover pressures and a large debt-service-to-export ratio include Angola, Egypt,  Mongolia, Pakistan, and Sri Lanka. Three of these—Angola, Egypt, and Pakistan—already have long-term IMF programs in place.

The United States and other Western countries need to take the lead on their own. After all, it is in the West’s self-interest not to see its own weakening growth prospects further damaged by the collapse of the developing world.

About 104 countries have been net food importers for some time. These countries had a total of $1.4 trillion in external public debt at the end of 2020, and they face $153 billion in projected debt-service payments in 2022, which can be jeopardized if international food prices continue to rise. Some economists warn that the magnitude of food supplied must be on the level of that provided under the Marshall Plan, which saved Western Europe from communism after the Second World War.

So far the Global South has not experienced any significant capital flight, despite signs that monetary policy will tighten substantially this year. Instead of waiting for another “taper tantrum” as happened in 2014 and 2018, the Biden administration and its allied partners should agree on a plan to deal with such an eventuality, which could happen without much warning.

The West should prepare for an extended crisis

The G20’s Debt Service Suspension Initiative expired at the end of 2021, leaving the Common Framework for Debt Treatment as the main debt-relief instrument despite only three countries having signed up, and none of these has gotten its debt successfully restructured. With the effects of the Ukraine crisis deepening these countries’ fiscal distress, the UN is recommending that the Debt Services Suspension Initiative be extended for at least two years and the Common Framework be dramatically enlarged. A broad range of middle-income emerging and developing economies that are currently ineligible should be considered for the Common Framework. In addition, access limits should be raised for the Rapid Credit Facility and Rapid Financing Instruments, and those limits should be extended to at least 2024.

Overseas development assistance by advanced countries was at record levels in 2021. Nonetheless, the Ukraine crisis, coming on the heels of the pandemic, is putting an end to the brief economic recovery that many countries saw in 2021–22. The world’s economic prospects would be troubled even without the war in Ukraine and Russian sanctions. Inflation was already a growing worry because of the initial robust pandemic recovery and supply constraints, and with the lockdown spreading in China to counter the Omicron variant in 2021-22, global economic growth was already being downgraded in most forecasts before the Ukraine war.

  • There remains a shortfall of some $15 billion in funding for the Access to COVID-19 Tools Accelerator and the World Health Organization target of vaccinating 70 percent of the world’s poorer populations has still not been met. The pandemic started developing economies on a downward economic path. There is an assumption, because mortality is falling in the United States and Europe, that the threat is waning—but the spread in China and other Asian countries is a reminder that the pandemic has not been conquered. The possibility of more virulent variants appearing in the future poses an ongoing threat for further economic dislocation.
  • Humanitarian organizations worry that the war in Ukraine will divert too much aid from other urgent needs. Maurice Amollo, a Nigeria-based official with the humanitarian aid group Mercy Corps, praised the “swift” response to the Ukraine crisis and “the generosity in Europe and the United States and beyond.” At the same time, he told Voice of America “we are also getting a little concerned that resources and diplomatic support will inevitably be diverted away from millions of other deserving and vulnerable communities around the world into Ukraine.” For example, Denmark will defer 40-50 percent of its development aid that had been destined for West Africa to boost aid for Ukraine. Sweden—one of the few countries along with Denmark that provides more than 0.7 percent of its GDP in development aid (the UN-recommended level)—has recently announced cuts to its assistance for others due to its funding for Ukrainian refugees. 
  • The appropriation of $58 billion for the baseline international affairs budget by the US Congress is only a 1 percent increase over last year’s appropriation despite growing inflation, and it’s less than both lawmakers and the White House had previously outlined. The bill includes $6.9 billion for the State Department and US Agency for International Development to assist Ukraine, which means reductions for other recipients. Five billion dollars in emergency COVID-19 funding for the rest of the world was stripped out at the last minute. There is a plan to vote on those funds separately later on, but “it’s not clear if there’s enough support to approve them.”
  • According to the IMF’s April 2022 economic update, “downside risks to the global outlook dominate—including from a possible worsening of the war, escalation of sanctions on Russia, a sharper-than-anticipated deceleration in China as a strict zero-COVID strategy is tested by Omicron . . . moreover, the war in Ukraine has increased the probability of wider social tensions because of higher food and energy prices, which would further weigh on the outlook.” Employment and output for all countries will typically remain below pre-pandemic trends through 2026. “Scarring effects are expected to be much larger in emerging market and developing economies than in advanced economies—reflecting more limited policy support and generally slower vaccination [rates]—with output expected to remain below the pre-pandemic trend through 2026.”

China “wins” out of default?

During the past decades, Chinese influence in the developing world, particularly in Africa and Asia, has grown quickly, making Beijing the most important external partner for many in the Global South. China is the largest trading nation in the world and, as shown by its current slowdown, developments there negatively affect trading partners in Africa and Latin America. How China fares can either lift other countries up or suppress growth elsewhere.

China is the world’s largest official creditor, with outstanding claims in 2017 surpassing the loan books of the IMF, World Bank, and of all other 22 Paris Club governments combined. In recent years, for the 50 most-exposed countries, Germany-based Kiel Institute estimates that debt owed to China has increased from less than 1 percent of debtor country gross domestic product (GDP) in 2005 to more than 15 percent in 2017. A dozen of these countries now owe debt of at least 20 percent of their nominal GDP to China. Most deals are opaque, making it hard to estimate actual amounts of debt owed to China. An estimated fifty percent of China’s lending to developing countries has been assessed to be unreported.

China’s overseas lending boom
The figure represent a subset of outstanding Chinese overseas debt claims as reported in China’s BoP Statistics. Trade credit includes short- and long-term trade credits and advances. Portfolio debt is excluded. From Kiel Institute Working Paper by Horn et al. (2019).

The Kiel Institute judges, however, that China’s lending boom has come to an end, having peaked in 2019. China announced that it had extended debt relief to developing countries worth a combined $2.1 billion under the G20 program—the highest among the group’s members in terms of the amount deferred—but much of the time it provides an extension on repayment. The restructuring and defaults have strongly risen since 2019, according to the Kiel Institute.

Many have criticized Chinese lending as an effort to entice developing states to take on more debt than they can handle and thereby become dependent on China. The London-based Chatham House undertook a comprehensive study of Chinese lending and concluded that “China’s development financing system is too fragmented and poorly coordinated to pursue detailed strategic objectives; and developing-country governments and their associated political and economic interests determine the nature of BRI [Belt-and-Road Initiative] projects on their territory.” The Chatham House study assesses that in the case of Sri Lanka and Malaysia—”the two most widely cited ‘victims’ of China’s ‘debt-trap diplomacy’”—the debt burdens “arose mainly from the misconduct of local elites and Western-dominated financial markets.”

US options for getting ahead of the unfolding crisis

The United States and other Western countries have an opportunity to demonstrate their concern to debt-ridden developing countries through immediate relief and pushing the G20 to take action over the medium term. Because of the dysfunction within the G20 over Russia’s participation, whether G20 finance ministers will even meet next month in Indonesia is unclear. The United States and other Western countries need to take the lead on their own. After all, it is in the West’s self-interest not to see its own weakening growth prospects further damaged by the collapse of the developing world.   

  1. The amount of extra money to be distributed by advanced countries from the IMF’s $650 billion allocation of special drawing rights (SDRs) has unfortunately so far fallen short of expectations, after the G20 group of large economies reported combined pledges of $60 billion. According to a Financial Timesreport, “the amount, to be disbursed through the voluntary channeling of special drawing rights, does not match the $100bn set as a ‘global ambition’ by the G20 last year . . . and less than a quarter of the $290bn given to members of the G7 group of advanced economies.” China has pledged a quarter of its SDR allocation to Africa and is playing the role of a provider of liquidity by buying SDRs held by poorer countries. Meanwhile, Republicans in Congress have so far blocked the Biden administration from disbursing the US portion of SDR to poor countries. The administration should try to find ways around Republican opposition.
  2. The United States also has an opportunity to help with lending through the International Development Association (IDA), the concessional lending arm of the World Bank. The United States ”reclaimed its position as IDA’s top donor, pledging $3.5 billion over three years to support pandemic response and an economic rebound in the world’s poorest countries.” Nonetheless, it is up to Congress to deliver on its past commitment and make a partial first installment this year toward the latest US three-year pledge. Donor contributions are a very good value because they typically mobilize four additional dollars in IDA commitments to poor countries. From 2010 to 2020, China went from being IDA’s thirtieth- to its sixth-largest donor. US contributions had been drifting down before this latest commitment.
  3. Debt relief is a harder challenge. David Malpass, World Bank head, has called for a new global cooperative approach and mechanism for providing an early orderly resolution of debt problems and prevent unnecessary defaults. A more permanent solution would mean convincing Beijing to join an internationally agreed-upon mechanism and be transparent about all its lending. Moreover, low- and middle-income countries owe five times as much to commercial creditors as to bilateral ones. The G20’s common framework could be a vehicle so long as there is a common will to use it. Otherwise, creditors will worry it “will just become a covert means of redistribution to other lenders unwilling to play ball.”

It must be recognized that “China has provided more debt relief through the G20’s Debt Service Suspension Initiative than any other country and has bilaterally negotiated up to US $10.8 billion of relief with debtor countries since the onset of the pandemic.” Debtor countries need to assume more responsibility, but the United States and its European allies need to take charge too and not allow a debt crisis, which is already roiling Sri Lanka, to expand and spread, becoming a major challenge for the global financial system. Germany as current G7 president and Indonesia as G20 head have a special responsibility, but the United States should also take a lead, demonstrating its concern for the plight of so many in the developing world.

Stiff costs for all

A “lost” decade for over half of humanity is in no one’s interest. The growing instability in Sri Lanka is a foretaste of what could happen in other countries that are increasingly leveraged and facing rapidly increasing food, energy, and other costs. The Associated Press and National Public Radio have reported that “people have been forced to queue for hours every day to buy essentials. Doctors have warned of a crippling shortage of life-saving drugs in hospitals, and the government has suspended payments on $7 billion in foreign debts due this year alone.” According to the World Bank, “Since the start of the COVID-19 pandemic, the world has seen a series of massive setbacks to stability in regions across the world: from Asia and Africa to Latin America and the Caribbean and more recently in Eastern Europe.” Even before Russia’s assault on Ukraine produced a record number of refugees, as of mid-year 2021, the United Nations High Commissioner for Refugees estimated that “global forced displacement has likely exceeded 84 million by mid-2021, a sharp increase from the 82.4 million reported at end-2020.” Many went to other developing countries, but a significant number sought refuge in advanced economies.

Scraping by with higher debt servicing and the growing costs of food and energy supplies, developing countries have little to spare for investment in renewables and other climate-change-related mitigations and adaptations, particularly as advanced economies have not met their target of providing $100 billion in annual climate-change support for developing countries. 

An opportunity, if not a responsibility

The West’s relatively poor record on getting vaccines out to Africa and elsewhere gave the impression of self-interest. Although the West is by no means responsible for the unprovoked Russian invasion, Ukraine should not be the only target for Western redress. The war in Ukraine may turn out to be an inflection point in more ways than anticipated. The West, which is currently taking care of its own economic problems and ignoring the plight of the developing world, is undermining its influence elsewhere among a majority of the world’s population. In recent years over half of the world’s economic growth has been powered by developing countries, giving others—principally China—an opportunity to expand their influence while undermining democracy prospects in developing nations. Without strong middle classes, democratization will be impeded, and the backsliding that has already occurred will be hard to overcome.

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Aviso LatAm: COVID-19 May 21, 2022 https://www.atlanticcouncil.org/content-series/aviso-latam-covid-19/aviso-latam-covid-19-may-21-2022/ Sat, 21 May 2022 11:40:35 +0000 https://www.atlanticcouncil.org/?p=526947 Argentina's annual inflation is expected to reach 60 percent this year

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​​​​​What you should know

  • Argentina: Annual inflation is expected to reach 60 percent this year. Prices have already risen 23.1 percent since January 1, indicating a stagnated recovery.
  • PAHO: Launched the Information Platform on Health and Migration in the Americas initiative to help countries safeguard the right to health of migrants in the region.

Monitoring COVID-19 economic recovery in the region

  • Mexico: Recorded a 25 percent increase in remittance flows following an increase of transit migrants en route to the United States in 2021.
  • Brazil: Inflation reached 12.1 percent, far above the 3.5 percent target. The Central Bank will likely continue to raise interest rates after already raising rates to 12.8 percent from a 2.0 percent record low in March 2021.
  • Colombia: Estimates indicate the economy grew about 7.5 percent in the first quarter of 2022, a decrease from 10.8 percent at the end of 2021.  
  • Uruguay: The Central Bank increased its benchmark interest rate to 9.3 percent, signaling that borrowing costs will keep rising as monetary policy tightens to fight inflation.
  • Chile: Congress approved an increase in the minimum wage to address soaring inflation. Transitional compensation will help small and medium businesses adjust to the change.

In focus: Remittances flows to Latin America and the Caribbean

Remittances to Latin America and the Caribbean (LAC) surged to $131 billion in 2021, a 25.3 percent increase from 2020 due to the strong job recovery for foreign-born workers in the United States. Countries registering the highest growth rates included Guatemala (35 percent), Ecuador (31 percent), Honduras (29 percent), and Mexico (25 percent).

Remittances are a major source of hard currency for LAC, which is one of the top remittances receiving region in the world. For some countries, including El Salvador, Honduras, Jamaica, and Haiti, remittance flows represent at least 20 percent of GDP. In 2022, remittances are expected to increase by 9.1 percent, though downside risks remain, including the costs of cross-border remittance flows.

Health + Innovation

  • 918,000: The number of new cases recorded last week in the Americas, a 27.2 percent increase over the previous week.
  • Argentina: Health Minister Carla Vizzotti announced a fourth wave of COVID-19 as weekly recorded cases increased by 92 percent.
  • Food crisis: In 2021, nearly one million more people faced food insecurity in El Salvador, Guatemala, Haiti, Honduras, and Nicaragua due to rising food prices coupled with COVID-19’s economic effects.
  • Central America: In the last week, new COVID-19 infections rose by 80 percent.
  • 120,000: The number of new COVID-19 cases recorded in Brazil from May 9-15, a nine percent increase over the previous week.

Geopolitics of vaccine donations: US vs. China

  • The United States outpaces China in its donations of COVID-19 vaccines to Latin America and the Caribbean, with Colombia and Mexico topping the list. The region has received roughly 52 percent of all US COVID-19 vaccine donations. To learn more, visit our COVID-19 vaccine tracker: Latin America and the Caribbean.

The post Aviso LatAm: COVID-19 May 21, 2022 appeared first on Atlantic Council.

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China’s faltering “zero COVID” policy: Politics in command, economy in reverse https://www.atlanticcouncil.org/in-depth-research-reports/report/chinas-faltering-zero-covid-policy-politics-in-command-economy-in-reverse/ Wed, 11 May 2022 13:00:00 +0000 https://www.atlanticcouncil.org/?p=521748 Could Beijing's doubling down on the "zero COVID" policy undermine the narrative of China’s superiority in responding to the pandemic—and the image and stature of Xi’s rule?

The post China’s faltering “zero COVID” policy: Politics in command, economy in reverse appeared first on Atlantic Council.

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Introduction

After COVID-19 emerged in Wuhan two years ago, it spread rapidly around the world, infecting hundreds of millions and taking over six million lives.1 After subduing the initial outbreak, China shut its door to the pandemic by imposing a strict regime of residential lockdowns and business shutdowns, quarantines, mass testing, and stringent border controls.

The response—which Beijing calls “dynamic clearing” (动态清零),2 but is widely known as zero COVID—succeeded in keeping the virus at bay for nearly two years. It is a policy that Chinese president Xi Jinping and his minions have used to fortify China’s aspirations to global leadership and to solidify Xi’s unchallenged political position atop the Chinese Communist Party. The policy’s initial effectiveness—after the initial Wuhan outbreak killed several thousand Chinese citizens3.—provided a wellspring of propaganda for Beijing to declare the superiority of its policies and political system as competitors, most notably the United States, struggled at times to contain the disease.

Yet the emergence of highly infectious coronavirus variants—first Delta beginning in late 2021, and then Omicron in March and April—has strained the zero-COVID policy past the breaking point. Outbreaks spread across the nation in March, leading local governments to impose lockdowns affecting the twenty-five million inhabitants of Shanghai, the economic powerhouse of Shenzhen, and provinces from Hainan in the south to Jilin in the northeast.4

The outbreaks have raised the very real possibility that the zero-focused approach can no longer contain the pandemic. There are even reports that a new, homegrown strain of Omicron has emerged.5

The rationale for the zero-COVID policy was anchored, in part, in the reality of China’s ill-equipped public health system. The country has 2.7 nurses per one thousand people, well below the average of 11.5 in the advanced economies, and only 4.4 intensive care beds per one hundred thousand people versus 25.8 in the United States and 33.9 in Germany.6 By early January 2022, nearly 2.9 billion doses of Chinese-produced COVID-19 vaccines had been given to the country’s 1.4 billion people, and another 1.41 billion doses sold or donated abroad as of March 21, 2022.7Yet those vaccines, based on an inactive form of the virus, have become generally less effective as the COVID-19 virus has evolved. Tests have showed that the two Chinese vaccines offered only limited protection against variants.8

So far, Beijing has resisted making use of the foreign-made mRNA vaccines that have proven so effective. Instead, it has pinned its hopes on developing China’s own version of the shots—a biomedical achievement that has proved difficult to replicate.9

Nonetheless, the zero-COVID policy allowed China to return to normal life for many months. It enabled China’s export machine to emerge from the nationwide shutdowns of early 2020 and shift into high gear to meet global demand for masks, mobile devices, and other stay-at-home products. Chinese factories helped power nearly 8 percent gross domestic product (GDP) growth in 2021, another achievement that Beijing has trumpeted as exemplifying China’s superior governance.

At the same time, China faced contagion of a different sort—a spreading economic slowdown that the export boom could not offset. Zero COVID has had a deep impact across various sectors of the economy—especially the entertainment, restaurant, tourism, and other service industries that represent the country’s largest share of employment. At the same time, this slowdown is exacerbating the deepening problems of China’s all-important property and construction sectors. Moreover, the widening shutdowns have produced new worries about “new bottlenecks in global supply chains,” as the International Monetary Fund (IMF) highlighted in its April 2022 World Economic Outlook.10

Now the pandemic’s reemergence threatens to deal a new blow to the economy that could combine with what appears to be the growing frustration of many Chinese with unrelenting lockdowns and other disruptions to daily life. This could undermine the narrative of China’s superiority in responding to the pandemic—and the image and stature of Xi’s rule.

The party wins

After the initial COVID-19 outbreak erupted in Wuhan in January 2020, the spiraling crisis appeared a potential threat to the Chinese Communist Party. Since its leaders characterize themselves as infallible, they perceive any major social disorder or high-profile policy failure as a danger to their legitimacy and control. A public health fiasco that takes the lives of a significant number of people could have presented a serious risk to the party’s implicit contract with its citizens: give us full political power and we’ll take care of you.

As the pandemic reached crisis proportions in Wuhan during the early stages of the outbreak, the threat became more and more apparent. Public revelations—rare in China’s tightly monitored media environment—exposed that the government, at both the national and local levels, had badly mishandled the initial response and allowed the virus to spread. A quarantine in Wuhan was imposed only after five million residents had already departed from the city, carrying the mysterious pathogen with them.11

Worst of all, the unfolding tragedy appeared to be a result of the party’s authoritarian governance. Li Wenliang, a Wuhan doctor, had recognized the new virus and shared that critical information in an online chat group in late December 2019. Local authorities forced him to recant his claim. The government seemed to place its own image above the public good. This doctor, who contracted COVID-19 and died soon afterward, became a folk hero—and a lightning rod for criticism of the regime. 12His ill-treatment suggested that China’s authoritarian system itself was a contributing factor to the terrifying outbreak. The stench of a scandal reached all the way up to Xi. A Communist Party journal suggested that Xi was directly involved in managing the government’s policy toward the outbreak in early January, thus implicating him in the bungled response.13

The existential threat to party rule resulting from the COVID-19 outbreak is at the very core of its zero-tolerance policy. Though it is true that the leadership had to be concerned about an uncontrolled pandemic that overwhelmed the poorly resourced hospital system, the party also needed to protect itself, both from the potential fallout of a nationwide health crisis that would raise doubts about its competence, and the deeper risk that its governance system would be tarnished and then questioned by the public at large. The threat had to be eliminated, at all costs.

Once the government mobilized against the virus, it did so with an intensity and severity unmatched almost anywhere else. The strict practices eventually put in place—large-scale lockdowns and quarantines of major cities, limitations on domestic and international travel, an effective border closing, testing on a mass scale, detailed tracing of cases—were draconian. Yet they were effective in containing the pandemic in a relatively short period of time, and then preventing its reemergence.

By mid-March 2020, new cases in China reached zero,14 and keeping them there became a political imperative. Once the party had extinguished the coronavirus menace, it desperately wanted to prevent a resurgence.

The apparent success of the heavy-handed coronavirus lockdowns offered the party an opportunity to rewrite the political narrative of the pandemic. The original story—of an autocratic state that sacrificed people’s lives for its own interests—was redrafted into the very opposite. Now the state was willing to sacrifice anything for the national interest. Even better, an authoritarian state had the capabilities, skill, and leadership to implement a successful policy that prevented a widening crisis and saved lives. The battle with COVID-19 was transformed into another triumph of the Chinese people against the odds, a national struggle that would pave the road to national rejuvenation. All thanks to the Communist Party, of course. A white paper on China’s COVID-19 experience released by the State Council in June 2020 characterized the anti-pandemic effort as an “all-out people’s war” won “through painstaking efforts and tremendous sacrifice” and achieved “under the leadership of the CPC.”15 Xi, in his 2021 New Year’s address, proclaimed that “we put people and their lives first to interpret the great love among humans. With solidarity and resilience, we wrote the epic of our fight against the pandemic.”16 After all, the party cares most about the common people. As Premier Li Keqiang put it in a speech to the National People’s Congress in May 2020, the economic cost of the coronavirus-control policies “is a price we must pay, and a price worth paying” because “life is invaluable.”17

CCP credibility on the line

The tragedy-to-triumph script composed by the Communist Party has had tremendous political consequences. The party tied its credibility to the zero-COVID policy. An outbreak, and thus a failure of the policy, equated to a failure of the party and its governance. COVID-19 cases became a measure of the party’s merit and legitimacy, similar to economic growth statistics—proof that it can deliver real results to the Chinese people and therefore has a right to rule.

That has had several real-life effects on the Chinese political, economic, and social system. First, the zero-COVID strategy became entrenched and inflexible. Easing up and risking a renewed outbreak would potentially erupt into both a public health challenge and a political crisis. That made moderating the approach to suit new circumstances problematic and helped to encourage sometimes extreme and excessive responses by local governments. For instance, officials kept strict lockdowns in place in the metropolis of Shanghai in 2022 and in Xi’an in late 2021, largely prohibiting  their millions of residents from leaving their homes, even as households ran short of food.

As a result, China has become “stuck in time,” still shutting down cities and restricting cross-border travel while much of the rest of the world is learning to live with COVID-19 and striving to restore normal life, business, and mobility. The economic toll has mounted as disruptions to business operations and daily life continued (see more below).

Secondly, the policy may have further entrenched the Communist Party in Chinese society. Not only do its top cadres have a success to market to the public, the pandemic offered an opportunity to tighten political and social control. New systems to track people’s movements—established in the name of public health—can easily be utilized for more sinister purposes. Citizens must scan QR codes to get into office buildings, restaurants, and shops—good for hunting down COVID-19 cases, or the party’s critics. Citizens require “health codes,” generated through apps such as WeChat and Alipay, in order to travel and access events and buildings—which could be used to limit the movements of targeted individuals. Such requirements may not be removed once the coronavirus epidemic has finally passed, leaving the party with extra monitoring tools, and a populace more accustomed to being overtly tracked.

Third, zero COVID may have bolstered the stature of Xi and increased his chances of claiming a third term at the twentieth Communist Party Congress later in 2022. Xi has become personally tethered to the policy and its success. The victory over the coronavirus was not just a win for the party, but for Xi specifically. The State Council’s white paper proclaimed in its opening paragraphs that “General Secretary Xi Jinping has taken personal command, planned the response, overseen the general situation and acted decisively.”18 Such statements are somewhat boilerplate in Communist documents, but in a political climate in which Xi has concentrated political power in his person, the buck, in reality, has nowhere else to stop.

That, too, has added inflexibility to the zero-COVID approach. A failure of the policy would translate into a personal political disaster for Xi himself. It should come as no surprise that he appears to be committed to upholding the policy and has insisted it continue. Josh Chin of The Wall Street Journal reported in late 2021 that Xi was furious when government officials suggested softening zero COVID and finding ways to live with the virus, accusing them of being too lax.19 In mid-April 2022, as economic and social pressure was building to ease a near-total lockdown of Shanghai, Xi insisted zero-COVID should not be relaxed.20

Now, as the government seeks to limit the excesses, and thus the economic cost, of zero COVID, the politics of the policy loom large. As noted above, Chinese authorities have solid public health reasons for maintaining the approach. Yet equally important is the party’s fear of political fallout from a renewed outbreak. As the recent surge in cases in Shanghai and Hong Kong sadly shows, past success at virus-fighting is not a guarantee of future performance. With an inadequately vaccinated populace (more on that below), the new coronavirus variants could easily take hold in China—and undermine the party’s neatly crafted political narrative as well. It is a risk the party is unlikely to take. That means the government may soften zero COVID only on the margins and continue to react with speed and severity to any inkling of growing infections.

Model for the world

The Communist Party recognized that its refashioned narrative of the pandemic could potentially burnish its image abroad as well as at home. Its self-proclaimed zero-COVID triumph quickly entered Beijing’s increasingly assertive propaganda campaign to promote China as a global leader and model for the rest of the world.

The messaging began only weeks after the initial Wuhan outbreak. In March 2020, the state-owned China Daily opined that Beijing’s methods of quick detection and quarantine could halt the global pandemic: “Countries, especially those in the West, should pay due attention to these principles, and waste no more time in applying them,” it recommended.21 A month later, Liu Xiaoming, then China’s ambassador to the United Kingdom, penned an essay for the Financial Times entitled “China Has Valuable Lessons for the World in How to Fight Covid-19.”22In it, he touted China’s lockdown method of containment and claimed: “the initial success in China has bolstered international confidence in beating the virus.” The messaging also tried to present China as a more responsible global leader than the United States, more committed to the global good and international cooperation. For example, Beijing highlighted its support for the World Health Organization (WHO) to differentiate itself from the Trump administration, which criticized and then withdrew from the body.

As zero COVID continued to keep the pandemic at bay, while the United States and other countries struggled to contain the virus, Chinese state media and the regime’s supporters claimed China’s success as a mark of the superiority of its governance system, especially compared to democracy. Hu Xijin, then editor of the Global Times, a Communist Party-run news outlet, wrote in May 2021 that the normality of life in zero-COVID China was a “display of the competitiveness of China’s approach of governance,” especially in light of the failed response in the United States. That, he continued, stripped Washington of the right to criticize China’s political system. “The highest human right—the right to life—has never been the top priority in the [United States],” he wrote. “American leaders, please have some sense of shame.”23

If China’s superior coronavirus-busting skills were a sign of its ascent as a world power, an additional line of argument went, then America’s inability to contain the virus was an indication of its corresponding decline. Xinhua, the official news agency, added Washington’s inept pandemic response to a list of failures, including domestic social disparities and botched foreign interventions. “The ‘shining city’ has been seeing its halo fading away,” the commentary contended.24

Financier Eric Li, in an essay for The Economist in December 2021, used the high number of COVID-19 deaths in the United States, Brazil, and India compared to China as primary evidence that liberal democracy is failing while the Chinese governance system (which he attempted to characterize as a form of democracy) is succeeding. “Some may object that this [low number of COVID-19 deaths in China] was because China restricted freedoms more than ‘democracies,’ ” Li wrote. “But what kind of democracy would sacrifice millions of lives for some individuals’ freedom not to wear masks? It is precisely in this way that liberal democracy is failing its citizens.”25

In order for this narrative to stick, however, the Chinese leadership and its propaganda machine had to contend with the inconvenient truth that the pandemic began on their own soil, and was allowed to spread by their own mistakes. Just as this undeniable reality had presented a danger to the Communist Party’s domestic standing, so, too, it could tarnish its international reputation and stature. The regime’s critics tried to make certain of that by reminding the world Beijing should be held responsible for the global pandemic.

The party’s solution was an attempt to alter the historical record and sow confusion about the virus’s origins. Instead of the home of the initial outbreak, China tried to paint itself as the world’s savior. In mid-March 2020, Xi told the United Nations secretary-general that “China’s extraordinary response has bought precious time for other countries to fight the virus,” according to the Foreign Ministry’s official summary of the conversation.26 Liu, in his Financial Times essay, wrote that critics who accused China of being responsible for the epidemic did so out of ignorance. “I believe those who seek to stigmatize China owe the Chinese people an apology,” he contended.27

Officials and state media strove to disassociate the virus from its first appearance in Wuhan and sow confusion about its origins. For instance, they went on an offensive against the use of the terms “Wuhan virus” or “Chinese virus.” In March 2020, when President Trump called COVID-19 the “Chinese virus” in a tweet, a spokesperson for China’s Foreign Ministry derided it as “stigmatization.” The ministry urged the United States to “immediately correct its mistake and stop making unwarranted accusations on China.”28 A few days later the ministry claimed that the Chinese people and international community “explicitly oppose linking the virus with any specific country or region.” Playing up sensitivity in the West to discrimination, the spokesperson went on to say that “some in the [United States] who can still see things clearly have publicly opposed the saying of ‘Chinese virus,’ pointing out that it is bald-faced racism and xenophobia.”29 In May 2020, the ministry released a notice called “COVID-19, 15 Truth [sic] You Need to Know,” with the first “truth” stating that “Wuhan city in China first reported COVID-19 cases, but that doesn’t mean the virus originated in Wuhan.” It continued to assert that “there is no certain conclusion as to the origin of COVID-19,” and “there is no evidence that China is the source of the virus that caused COVID-19.”30

Evading responsibility

The narrative, however, required even more embellishment. If the virus did not originate in China, then where did it come from? How did it get to Wuhan? Knotty questions indeed for the avid Chinese propagandist. The government and its state-controlled media grasped at any shred of scientific inquiry that suggested the origins of the virus could be traced to other countries, and actively spread misinformation.

Foreign Ministry spokesperson Zhao Lijian tweeted an unfounded conspiracy theory that the COVID-19 virus was brought to Wuhan by members of the US Army.31In March 2022, Li Yang, counsellor at the information department of China’s Foreign Ministry, turned to Twitter to spread the conspiracy theory that American pharmaceutical firm Moderna created the virus and demanded an explanation from the United States.32Officials also pushed the idea that the COVID-19 virus was transmissible on imported refrigerated food. The attempts to blame the outside world for local outbreaks continues. In recent months, officials have suggested Chinese were infected by the virus lurking on or in international mail.33

How much progress this campaign achieved in changing the pandemic’s narrative is questionable. In a fourteen-nation survey conducted in 2020 by the Pew Research Center, a median of 61 percent of the respondents thought Beijing handled the pandemic poorly, while unfavorable views of China reached all-time highs in many countries in the poll.34 In certain respects, the propaganda campaign may have had negative consequences for China, both at home and abroad.35

First, the international blitz may have reinforced the inflexibility of the zero-COVID strategy. By using the policy’s success as evidence of its superior system, the leadership likely feared that the image of the party would be damaged if China experienced a major, uncontrolled outbreak. In that eventuality, the Chinese authoritarian model would be no better than the democracies Beijing has routinely mocked. That may have made it more difficult to adjust or move on from the zero-COVID policy, with all the resulting economic and social consequences.

Second, the campaign, in certain respects, exposed Beijing as an irresponsible power rather than a constructive one. So desperate was the leadership to avoid responsibility for the pandemic that it hindered the efforts of the international community to investigate and learn from the pandemic. Apparently, the party equated calls for an investigation with an attempt to undermine its reputation and rule.

Beijing has resisted an independent inquiry into the COVID-19 virus’s origins since the earliest stages of the pandemic in 2020,36 and when China’s leaders eventually consented, they tightly controlled the activities and access of a visiting WHO team of experts in early 2021 and refused to fully cooperate. For instance, Chinese authorities denied the investigators potentially valuable raw data on early COVID-19 cases.37 WHO Director-General Tedros Adhanom Ghebreyesus—who has generally avoided public criticism of China—admitted in a 2021 briefing that the investigative team was frustrated with their access to raw data while in China. “I expect future collaborative studies to include more timely and comprehensive data sharing,” he said.38Beijing then rejected a WHO plan for further study of COVID-19’s origins in mid-2021.39

Beijing was so fearful of an international inquiry that when the government of Australia called for one in 2020, Beijing resorted to economic coercion to arm-twist Canberra to change its position. In the end, the campaign to avoid blame for the pandemic may have hurt the Communist Party’s international reputation rather than enhanced it and fueled speculation about the true origins of COVID-19.

So, too, did the often rabid tone of Beijing’s messaging. Comments from officials and official media often appeared to mock other countries for their struggles to contain COVID-19, and seemed insensitive to their suffering. One especially egregious social media post on an account linked to the Communist Party juxtaposed two images—one of a rocket launch in China, the other a photo of COVID-19 victims being cremated in India. The text read: “Lighting a fire in China VS lighting a fire in India.” The post, made at the depths of India’s pandemic crisis, sparked outrage and was deleted.

At times, Chinese officials and state-media organs seemed to revel in the rising death toll in the United States. “America is coming back!” Diplomat Li Yang tweeted sarcastically amid a renewed surge in the United States in 2021. “Yes, thanks to a series of political manipulations, America is coming back at almost the peak of its epidemic!!!”40 In its quest to promote itself, the Chinese government too often denigrated others—hardly a method of winning hearts and minds.

Vaccine diplomacy’s threat to China

Perhaps the most damaging aspect of China’s COVID-19 policy was its “vaccine diplomacy.” Beijing clearly recognized that the pandemic offered an opportunity to expand Chinese political influence and “soft power” around the world, especially with developing countries, and to use homemade vaccines to market its companies and technology. Two companies, state-owned China National Pharmaceutical Group (Sinopharm) and private Sinovac Biotech, were at the center of the effort. With the United States distracted by its fight against the virus, Beijing was able to get a jump-start on a program to export China’s own vaccines, largely for sale but also as humanitarian aid.41 The leadership and state media routinely publicized China’s efforts to provide vaccines to developing nations, so as to portray the country as a caring and responsible great power. Xi himself played a part in this campaign, for instance, outlining his administration’s largesse in a speech before the Global Health Summit in May 2021.42

Certainly, some recipients of China’s vaccines were grateful for Beijing’s assistance, especially when the US products were not yet widely available for export in early 2021. Indonesian President Joko Widodo received his Sinovac jab in January 2021—which was duly promoted by Xinhua.43 According to data from the World Trade Organization and International Monetary Fund, China exported more than double the number of doses as the United States (though not as many as the European Union),44notching more than a third of total vaccine exports.

Yet the achievement was marred by a lack of transparency and outdated technology. Studies have suggested that China’s vaccines are somewhat less effective than their Western competitors (especially if not boosted). One recent study by two Hong Kong universities made the claim that even three doses of the Sinovac vaccine do not provide adequate protective antibodies against the Omicron variant.45 Chinese firms used an older method to develop their vaccines and did not have the capability to match the more advanced mRNA technology of Pfizer/BioNTech and Moderna products. In the end, Beijing’s attempt to show off its technological prowess instead revealed it still lags behind that of the major advanced economies.

The most problematic consequence of China’s “vaccine diplomacy,” however, threatens China’s own people. The Chinese government chose to vaccinate its citizens with only Chinese vaccines. That may have left China more vulnerable to outbreaks, especially of the new variants.

Beijing did have other options. Another Chinese firm, Fosun Pharmaceutical, reached an agreement with BioNTech to form a joint venture to supply the latter’s mRNA vaccine in China from a Chinese factory with the capacity to produce one billion doses a year, but Chinese regulators never approved the vaccine for use in China. (Beijing has not sanctioned any foreign vaccines for domestic distribution.) Vaccines, of course, are not a simple solution to the COVID-19 problem, but if China’s large population was better vaccinated, it would likely offer the leadership more flexibility in adjusting the zero-COVID policy. Without that, it is it all but impossible to reopen China’s borders to freer international travel as long as COVID-19 continues to rampage worldwide—and complicates efforts to balance zero-COVID control measures with the need to bolster slowing economic growth. It also makes it challenging for Beijing to find an exit route from the policy without risking a major public health crisis.

In an ironic twist, the Communist Party’s desire to promote itself on the world stage has come back to haunt it at home. From the start, China’s leaders viewed the pandemic in geopolitical terms and sought to capitalize on what they perceived to be a moment of weakness in the United States to score points in its intensifying global competition with Washington. Instead, while much of the rest of the world is learning to live with COVID-19 and other nations protect people through vaccines and advanced treatments, Beijing is badly behind the curve, still locking down cities and maniacally tracking cases as it was two years earlier. Rather than a leader, China has become the laggard.

The Chinese leadership and its supporters believe that the United States was willing to sacrifice hundreds of thousands of lives to an ideological commitment to freedom, or the definition of it to which some Americans adhere. They like to contrast the US approach to their own by claiming they base decisions on science. Yet China’s leaders made many key choices for political reasons and based on ideological precepts—most critically, the vaccine program, driven by Xi’s desire for self-reliance and the demands of competition with the United States. These decisions are having serious consequences for China’s current and future approach to COVID-19. The government must find a new course as the economy and society strain under the weight of pandemic restrictions, but it has left itself limited room to respond to changing circumstances.

Economics in a time of Zero COVID

The Chinese economy appeared to rebound smoothly from nationwide shutdowns during the early stages of the COVID-19 pandemic. As the virus spread from Wuhan through Europe, North America, and the rest of the world, China’s industrial sector returned to full output and supplied record amounts of exports to a world desperate for the protective gear and stay-at-home products that helped many people weather the pandemic.

China’s growth in 2020 slowed to only 2.2 percent—largely reflecting the impact of the first-quarter lockdowns—but it roared back later in the year and into 2021. GDP in 2021 expanded about 8 percent, with exports surpassing $3.3 trillion, including a single-month record in December 2021 of $340.5 billion.46However, domestic consumption—which has been identified by the government as a crucial driver of growth and the key to a rebalancing of the economy away from its export-driven model—never really recovered its pre-pandemic vitality as households tightened their purse strings and small businesses suffered. The pandemic was one reason for this disparity in economic performance, but there were other forces at play.

Nonetheless, the headline numbers provided plenty of reason for Beijing’s propagandists to proclaim the superiority of the country’s tough pandemic response. “Protecting lives will always be a priority, and it is acceptable that the economy is sacrificed more or less when necessary,” declared researcher Lu Xiang of the Chinese Academy of Social Sciences in an article that echoed a common government refrain. “After all, the economy can bounce back, but can life?”47

Indeed, as the Delta variant began to seep through China’s tightly sealed borders last year, the zero-COVID policy was imposed with increasing frequency. Lockdowns hit important cities like Xi’an and Tianjin, disrupting semiconductor and automobile production.48 Global supply chains that run through some of the world’s largest container ports like Ningbo and Shenzhen were hit by delays that sparked sharp increases in shipping costs.49

This year, however, it was Omicron’s complete shutdown of Shanghai, Shenzhen, and Dongguan in Guangdong province, and auto production center Changchun in the northeast that truly drove home the reality that the zero-COVID policy had failed to protect the Chinese people. For the first time since 2020, China publicly recorded COVID-19 deaths.50

The damage to the economy quickly mounted. By one estimate, Shanghai represents 3.8 percent of China’s GDP and one-fifth of the country’s trade. Guangdong accounted for nearly one-quarter of total exports in 2021. Shanghai and Shenzhen together are the beating heart of China’s financial markets.51

Consumptive consumption

The reality is that even before the Omicron outbreaks, China’s export surge has masked serious economic weaknesses that became increasingly evident during the second half of 2021, many of them the direct result of the country’s strict response to COVID-19.52Travel and tourism plummeted, and retail sales and household spending on restaurants, tourism, and other forms of entertainment all fell. Even though many Chinese returned to public spaces after the early lockdowns, the ailing sectors of the economy did not experience the same return to strong growth experienced by manufacturing.

Numbers compiled by the Rhodium Group highlight this slowdown: compounded growth of per capita consumption has declined to 5.8 percent during the two years of the pandemic compared with an average of 8.4 percent in the period leading up to 2020. Rhodium points to significant declines in consumption beginning in the third quarter of 2021.53

The first quarter of 2022 brought more bad news. While the economy expanded 4.8 percent, retail sales posted the worst contraction since COVID-19’s 2020 emergence in Wuhan. The latest outbreaks and lockdowns likely will reverberate through the economy as the year continues.54In mid-March, Goldman Sachs estimated that regions facing COVID-19 restrictions represented more than 30 percent of China’s GDP, and that was before the April outbreaks.55

China’s small businesses appear to be bearing the brunt of the downturn. One analysis of business registration data reported that only 1.3 million new small businesses registered in the first eleven months of 2021, while 4.4 million small businesses deregistered. In 2020, 6.1 million new businesses registered and 4.5 million deregistered.56

This is important because small and medium businesses represented about 80 percent of China’s urban jobs in 2013—overwhelmingly in the service sector.57Notably, employment in that sector grew more slowly than in the industrial sector last year for the first time since 2012.58 Nationwide unemployment has been on the rise, with young job seekers facing a particularly difficult job market.59

Nor has China’s industrial juggernaut been immune from the steadily deepening downturn. The Caixin/Markit Manufacturing Purchasing Managers’ Index for January showed that factory activity recorded the sharpest contraction since the early months of the pandemic, although it returned to growth the next month. The measure for new export orders contracted for eight straight months through March—a trend that partly reflects reduced foreign demand for pandemic-related products.60

The IMF warned about the likely continued impact of the pandemic in its most recent report on the Chinese economy: “The pandemic will continue to impede the recovery of consumption—especially services—before loosening its grip in 2023, which will require a combination of more efficacious vaccines and relaxation in the zero-tolerance strategy toward the virus” (italics added).61 The IMF forecasts that China’s economy will grow 4.4 percent in 2022, significantly below Beijing’s declared target at the March meeting of the National People’s Congress of “around 5.5 percent.”62 The IMF number, which is a downgrade from its January 2022 forecast of 4.8 percent growth, is attributed, in part, to the impact  of zero COVID.63

Property downturn: Frost on snow

The causes of China’s slowdown—and the reasons for worry about the economy—run much deeper than the pandemic.

Most importantly, China’s property sector is facing a complicated and deepening crisis that has sharply reduced real estate investment, home purchases and housing prices, and construction activity. The downturn has caused several developers to default on dollar-denominated bonds and renminbi obligations, which has only made matters worse. The situation poses a threat to the balance sheets of many local governments and has contributed to the drop in consumer confidence and spending. The succession of shocks—property crisis and COVID-19 restrictions—is  best described by the Chinese idiom: to add frost to snow(雪上加霜).

Property investment in China has been one of the world’s greatest one-way investment bets over the past generation. Hundreds of millions of Chinese have become homeowners, leading to the concentration of 70 percent of urban wealth in real estate.64More than 25 percent of China’s GDP is generated by the real estate sector and construction industry. The IMF estimates that “about a quarter of both total fixed investment and bank lending went to property” during the five years before the pandemic.65

Developers have taken on vast amounts of debt even as local governments have come to depend on revenue from land sales to them in order to finance essential services. Nonbank financial institutions and so-called local government funding vehicles (LGFV)—the same local governments that sell the land—also have heavy exposure to property investment. To make matters worse, about one-third of home purchases involve presales that builders use to finance construction, turning homeowners into creditors and immensely complicating developers’ balance sheets.66

This massive buildup of debt—the troubled China Evergrande Group amassed over $300 billion of liabilities before defaulting on dollar debt in 2021—presents a serious risk to China’s economic and financial stability.67Notably, it was Beijing’s effort to contain those risks that precipitated the downturn that swept across the property sector in 2021. Among the official actions were restrictions on mortgage lending in major cities, and a sharp tightening of controls on lending to developers that created the so-called three red lines, which sparked a severe, industry-wide credit squeeze.68 By the end of 2021, Fitch Ratings reported, ten Chinese property developers had defaulted on dollar-denominated bonds issued abroad, and in assessing the risks facing the country, Fitch singled out the vulnerability of LGFVs.69

The government effort to rein in the real estate sector—which it is relaxing70—has had predictable consequences. The country’s one hundred largest property companies have reported sharp falls in sales: down 39.6 percent on a year-to-year basis in January after falling 35.2 percent the month before. Construction output in the final quarter of 2021 dropped 2.1 percent, while the real estate sector fell 2.9 percent. In February 2022, prices fell for both new and older homes in seventy major cities, and the total value of new mortgages declined for the first time since 2007.71

In March, with COVID-19 lockdowns and other restrictions wreaking new havoc on the real estate industry, new home sales dropped 29 percent.72Meanwhile, the IMF reports that developers’ stock of presold, but unfinished, housing is nearly equivalent to the total number of homes completed since 2015.73 The widening ripple effects of the property downturn is only adding to the loss of confidence that consumers and businesses are feeling from the pandemic.

The policy toolbox: Half full or half empty?

The risks from the combination of zero-COVID policies and the property downturn are evident. Demand across several sectors of the economy is in danger of contracting further, unemployment could continue to rise (especially affecting the tens of millions of migrant workers who depend on construction and gig economy jobs), and the financial sector could come under stress as property companies struggle. The government’s longstanding effort to rebalance the economy away from investment and manufacturing, and toward consumption could falter even more.

Slower growth will also strain government resources, especially at the local level where officials have been saddled by Beijing with many new responsibilities over the past year. For example, under the zero-COVID policy they are expected to assume the cost of testing, surveillance, contract tracing, and quarantines.74

In addition, Xi’s policies intended to reduce inequalities in income and social services put the onus on local authorities to provide increased spending on education, health, housing, and other social services.75 That also doesn’t take into account the potential impact of problems with LGFVs, whose total debt is estimated at between 39 trillion and 53 trillion renminbi ($6.13 trillion to $8.33 trillion). Local governments recently have been using LGFVs to buy land at auctions when private bidders have stayed away.76

The government’s actions in the face of these threats have at times suggested complacency. It was noteworthy, for example, that even as the economy faced the unprecedented challenges of pandemic and property downturn, Beijing chose to launch a heavy-handed campaign aimed at reining in the country’s largest private-sector companies. The government used fines and bans for previously ignored regulatory transgressions to target e-commerce and tech platform conglomerates that are major employers and sources of business dynamism. The campaign has had a severe impact on business confidence and financial markets.77

In its “report card” on the Chinese economy released in February, the IMF said of the government policies: “The multitude, timing, seemingly uncoordinated, and discretionary nature of these [regulatory] interventions, [are] viewed by market participants as undercutting the role of private enterprises and has led to heightened policy uncertainty and financial market volatility. The lack of a clear, coordinated, and well-communicated policy response to financial stress faced by large property developers, following efforts aimed at reducing leverage in the real estate sector, has added to the uncertainty.” This is blunt language for an institution normally known for gentle criticism in its economic assessments of individual countries.78

The government has responded to the deepening slowdown, but the measures so far have disappointed markets. The People’s Bank of China (PBOC) announced in January that it would “open its monetary policy toolbox wider, maintain stable overall monetary supply and avoid a collapse in credit” to help sustain growth.“79. It followed by cutting key lending rates.80Subsequently, the central bank has held off on further rate cuts.“81

Then at the March National People’s Congress, Premier Li announced a package of fiscal measures, including tax cuts and increased spending—including trillions of yuan of direct transfers to local governments that will lose revenue because of the tax cuts—to help stimulate growth, with the government’s usual focus on infrastructure.82 These measures may provide some relief to the construction sector, but it will take more than additional highways and high-speed rail lines to boost an economy struggling with slack consumer demand and a slumping housing market.

As the Yicai business newspaper said of infrastructure investment in a rare moment of Chinese media candor: “Poor-efficiency investment has not been uncommon in past years, wasting resources to some extent. Thus, local governments should not blindly boost their investments, expecting better outcomes.”83Meanwhile, tax cuts will offer small comfort to locked-down businesses that have no customers.

Soon after the Congress’s rubber-stamping, it was hardly surprising when investors—with foreigners in the lead—stampeded for the exits.84That resounding no vote caused the Chinese leadership to respond with a series of measures to lift the markets, including assurances from Vice Premier Liu He that the crackdown on Internet companies would end soon, steps to prevent a property market collapse, and direct support for the stock market.“85The government also announced a postponement of the trial introduction of a property tax in some locales that was to be the precursor to a national levy.86 COVID-19’s continued spread—and especially the Shanghai lockdown—only caused further uncertainty, and the State Council and PBOC were forced to offer warnings about the economy to the nation.“87

The recent turbulence has tarnished Beijing’s reputation for effective economic policymaking, and with COVID-19 spreading again, and pessimism on the rise, China is likely to face more and more challenges from an economy that is increasingly buffeted by bad decisions and “the slings and arrows of outrageous fortune.”88

Zero COVID’s international implications

The global economy will not be immune to China’s economic problems, the most immediate concern of which is the impact of its zero-COVID policy. While the Chinese government so far has managed to keep factory output going, the battle against the variants at China’s ports has added new stresses to global supply chains.89 Wait times have lengthened for container vessels in Chinese waters, and air freight costs have at times risen sharply.90Some ships are bypassing Chinese ports altogether because of delays. The Shanghai lockdowns also have added to the delays—and hit local manufacturers—by severely affecting trucking into the Yangtze Delta.91 In addition, the war in Ukraine has disrupted rail shipments to Europe over train lines built under China’s Belt and Road Initiative—only increasing the load on the country’s harbors.92

While some multinational corporations have privately praised China’s efforts to contain COVID-19, the most recent lockdowns have affected operations across the board. A March 29-30 survey of US businesses operating in China nationwide and in Shanghai, conducted by the American Chamber of Commerce in the People’s Republic of China (known as AmCham China) and AmCham Shanghai, showed that 99 percent of respondents reported being “impacted” by outbreaks, with 81 percent of manufacturers reporting “slowed or reduced production.” In addition, 85.5 percent of manufacturers were experiencing “disrupted” supply chains.93 The worsening situation led the European Chamber of Commerce to send a letter to Vice Premier Hu Chunhua expressing concern about the social and economic costs of the pandemic.“94

Businesses worldwide are fretting at the cost of China’s port delays. It isn’t just a matter of deliveries to the United States, Europe, and other destinations. China’s imports are affected as well. By mid-February 2022, products ranging from raw materials to the electronics components essential for China’s vast industrial base were sitting at anchor in Chinese waters.“95

The burden of zero COVID is beginning to influence long-term planning for companies that have become accustomed to China as a production base. Stephen Lamar, CEO of the American Apparel and Footwear Association, says that the policy is adding to the pressure that his member companies are facing to move production out of China—coming on top of US tariffs on imports from China and official pressure to disconnect from Chinese suppliers in Xinjiang.

There also is the problem of the severe restrictions on travel to China, which makes running businesses much harder. The longer zero COVID remains in place, Lamar says, the more his members will look to shift to other countries.96

The impact of supply-chain problems on inflation—especially port and land-shipping delays in the United States—have been well documented for industries like semiconductors and food.97Several factors beyond those issues have contributed—ranging from rising oil prices to pent-up consumer demand. If China’s response to the latest outbreaks causes additional delays to cause price pressures to build, that would be an unwelcome international development, especially as some of the supply-chain backups elsewhere are untangled. Similarly, the rising cost of raw materials caused by the Ukraine war may soon be reflected in China’s export prices.

The deeper worry for the global economy stems from slowing Chinese demand. The implications of a steeper-than-expected drop in Chinese growth and a slowdown in construction would be a blow to economies still struggling to emerge from the pandemic-induced slowdown of 2020—especially developing countries. It would also add further uncertainty to a global economy adjusting to the shocks from Russia’s invasion of Ukraine.98

Conclusion

Zero COVID has been a tremendous success for the countless deaths it has prevented. Yet two years after its initial formulation, the strategy is facing its most severe test. Significant outbreaks across the country—most notably in the business capital of Shanghai—have stretched government resources and public endurance. The sagging economy has become a more pressing concern as continued lockdowns and disruptions hamper production and consumption, and weigh on the country’s fragile property market. The latest outbreaks, and the problems they have presented, suggest that China’s leaders may need a new strategy, or at the very least, an adjustment to the zero-tolerance approach.

The leadership appears to recognize that need. While remaining committed to the zero-COVID policy, Beijing has begun experimenting with methods to minimize the economic uncertainty it creates. For instance, authorities instituted a more limited lockdown in Shenzhen than in some other cities, and permitted some factories to remain open using a “closed-loop” formula. Many ports have continued to operate at a level that keeps imports and exports moving—albeit with some delays. The government approved Pfizer’s new anti-viral drug, Paxlovid, in February (though not its mRNA vaccine) as well as several rapid COVID-19 tests, indicating it may be looking to further moderate its coronavirus strictures.

Nevertheless, China’s leaders will likely struggle to move on from zero COVID, as the especially draconian lockdown in Shanghai showed all too clearly. With an under-vaccinated populace—only about half of those over 80 years of age have received the required shots99—and a feeble, state-heavy healthcare system, a shift away from the zero-COVID policy risks a major public health crisis. Politically, too, the leadership will find it challenging to break with the policy. Having touted it as a measure of its competence and proof of its legitimacy, both at home and abroad, the Communist Party might perceive threats in relaxing zero COVID. The party may also see a major outbreak in China as a diplomatic embarrassment. With the historic party leadership congress looming later this year, Xi will have to calculate what course best serves his chances of securing an extended term in office—continuing to strive for zero COVID, or relaxing pandemic restrictions to bolster a slowing economy and assuage public frustration.

The response to the severe lockdown of Shanghai also reveals how a continuation of zero COVID presents new risks to the Communist Party. The lockdown generated an unusual level of public protest, both on the streets and online, as well as resistance to some of the program’s more excessive elements, such as separating children who have tested positive for COVID-19 from their parents. The anguish of the people of Shanghai, suffering without food and basic necessities, generated sympathy and concern around China and the world, and fostered an impression that China’s governance was becoming increasingly inhumane. The Communist Party appeared unable to respond to the mounting difficulties—both in regard to the swelling humanitarian problems and angry public reaction. While making minor concessions on some aspects of its practices, the party mainly responded with greater force to impose its will, treating Shanghai as if it was a city in rebellion. The saga exposed both the limits of the government’s ability to continue its zero-COVID policy, and the limits of the Chinese people to tolerate it. The Communist Party arrived at its zero-tolerance approach to eliminate risks to its image and legitimacy; now it must find ways to moderate its COVID-19 policy to eliminate new risks resulting from those policies.

In that sense, zero COVID has shown us the strengths and weaknesses of China’s political and social system. At a time of crisis, the state was able to marshal resources and impose a level of societal control that few other governments around the world have the capacity (or the will) to match. Yet as is true with authoritarian regimes more generally, China’s government is trapped by policy inflexibility brought about by the dearth of public participation in politics and policymaking. That inflexibility is contributing to an economic downturn that is undermining the Chinese Communist Party’s assertion that it alone can deliver prosperity to the Chinese people. Worse still, decisions on COVID-19 policy could be influenced by the political needs of one man—Xi Jinping, and his quest for unprecedented power. Proponents of Chinese authoritarianism held up zero COVID as a sign of that system’s superiority, but the strategy may also prove to be one of that system’s greatest tests.

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Image: A worker in a protective suit stands behind barriers sealing off a residential area under lockdown, following the coronavirus disease (COVID-19) outbreak in Shanghai, China March 29, 2022. REUTERS/Aly Song

1    “WHO Coronavirus (COVID-19) Dashboard,” World Health Organization (website), https://covid19.who.int.
2    State Council of the Peoples Republic of China (PRC) “动态清零” 和 “零感染” 有何不同——国务院联防联控机制发布会针对疫情防控社会关注答疑解惑 (“What Is the Difference between ‘Dynamic Clearing’ and ‘Zero Infection’—Press Conference of the Joint Prevention and Control Mechanism of the State Council Answers Questions and Answers for Social Concerns About Epidemic Prevention and Control”), December 12, 2021,  http://www.gov.cn/xinwen/2021-12/12/content_5660202.htm.
3    State Council, “What Is the Difference”; “Covid-19 Deaths in Wuhan Seem Far Higher than the Official Account,” Economist, May 30, 2021, https://www.economist.com/graphic-detail/2021/05/30/covid-19-deaths-in-wuhan-seem-far-higher-than-the-official-count
4    For Delta outbreaks, see Shuli Ren, “Covid Zero in China Is a Fantasy. It’s Now All about ‘Dynamic Clearing,’ ” Bloomberg, January 11, 2022, https://www.bloomberg.com/opinion/articles/2022-01-11/covid-zero-is-no-longer-a-real-goal-in-china-it-s-time-for-dynamic-clearing?sref=E0nAM78N; Alexandra Stevenson, “China’s Lockdown Shows Stubborn Resolve on Zero-Covid,” New York Times, January 6, 2022, https://www.nytimes.com/2022/01/06/world/asia/china-xian-lockdown-covid.html; for March 2022 outbreaks, see “China’s Covid Lockdowns Could Threaten Half of Economy,” Bloomberg, March 14, 2022, https://www.bloomberg.com/news/articles/2022-03-14/china-s-covid-lockdowns-could-threaten-half-of-economy?sref=E0nAM78N; and “Entire Shanghai Placed under Lockdown, ” Bloomberg, April 1, 2022, https://www.bloomberg.com/news/articles/2022-04-02/entire-shanghai-placed-under-lockdown-as-covid-cases-surge?sref=E0nAM78N.
5    “China Finds New Virus Subtype as Daily Cases Exceed 13,000,” Bloomberg, April 2, 2022, https://www.bloomberg.com/news/articles/2022-04-03/china-adds-over-13-000-covid-cases-as-shanghai-outbreak-widens?sref=E0nAM78N.
6    For number of nurses in China, see David Fickling and Anjani Trivedi, “Supply Chain Snarls May Be Here to Stay, Too,” Bloomberg Opinion, January 13, 2022, https://www.bloomberg.com/opinion/articles/2022-01-13/omicron-may-be-about-to-finally-give-us-a-supply-chain-crisis-as-it-hits-china?sref=E0nAM78N; and for hospital beds, see Robin Xing, Jenny Zheng, Zhipeng Cai, and Helen Lai, “Omicron in China: Impact and Policy Implications,” Morgan Stanley, January 9, 2022.
7    For doses in China, see National Health Commission of PRC, “Nearly 2.9b COVID-19 Doses Administered on Chinese Mainland,” via Xinhua News Agency, January 11, 2022, http://en.nhc.gov.cn/2022-01/11/c_85571.htm; and for doses sold or donated abroad, see “China COVID-19 Vaccine Tracker,” Bridge Consulting (Beijing), https://bridgebeijing.com/our-publications/our-publications-1/china-covid-19-vaccines-tracker/.
8    Elie Dolgin, “Omicron Thwarts Some of the World’s Most-Used COVID Vaccines,” Nature, January 13, 2022,  https://www.nature.com/articles/d41586-022-00079-6; and Sumathi Bala, “China’s Zero-Covid Strategy ‘Won’t Work’ against Omicron, Says US Epidemiologist,” CNBC, February 6, 2022, https://www.cnbc.com/2022/02/07/chinas-zero-covid-policy-will-not-work-with-omicron-epidemiologist.html.
9    Roxanne Liu and David Stanway, “FACTBOX: China’s mRNA COVID Vaccine Candidates,” Reuters, February 28, 2022, https://www.reuters.com/business/healthcare-pharmaceuticals/chinas-mrna-covid-vaccine-candidates-2022-02-28/.
10    International Monetary Fund, “World Economic Outlook” (WEO), April 2022, xiii, https://www.imf.org/en/Publications/WEO/Issues/2022/04/19/world-economic-outlook-april-2022.
11    “Five Million People Left Wuhan Before the Lockdown, Where Did They Go?,” CGTN (Chinese state-run cable TV news service), January 27, 2020, https://news.cgtn.com/news/2020-01-27/5-million-people-left-Wuhan-before-the-lockdown-where-did-they-go–NACCu9wItW/index.html.
12    Chris Buckley and Paul Mozur, “A New Martyr Puts a Face on China’s Deepening Coronavirus Crisis,” New York Times, February 7, 2020, https://www.nytimes.com/2020/02/07/world/asia/china-coronavirus-doctor-death.html.
13    Tom Mitchell, Christian Shepherd, and John Reed, “China’s Xi Jinping Knew of Coronavirus Earlier than First Thought,” Financial Times, February 1, 2020, https://www.ft.com/content/3da73290-5067-11ea-8841-482eed0038b1.
14    Javier C. Hernández, “China Hits a Coronavirus Milestone: No New Local Infections,” New York Times, March 18, 2020, Updated April 14, 2022, https://www.nytimes.com/2020/03/18/world/asia/china-coronavirus-zero-infections.html.
15    China’s State Council Information Office, “Fighting COVID-19: China in Action,” White Paper, Released via China’s Xinhua (state news service), June 7, 2020, http://www.xinhuanet.com/english/2020-06/07/c_139120424.htm.
16    Xi Jinping, “2021 New Year’s Address,” via Global Times (Chinese Communist Party flagship newspaper), December 31, 2020, https://www.globaltimes.cn/page/202012/1211532.shtml.
17    Li Keqiang, “Premier Li’s Speech at the Third Session of the 13th NPC,” CGTN, May 22, 2020, https://news.cgtn.com/news/2020-05-22/Full-text-Premier-Li-s-speech-at-the-third-session-of-the-13th-NPC-QHaP1FpB8k/index.html.
18    China’s State Council Information Office, “Fighting COVID-19: China in Action.”
19    Josh Chin, “Xi Jinping’s Leadership Style: Micromanagement That Leaves Underlings Scrambling,” Wall Street Journal, December 15, 2021, https://www.wsj.com/articles/xi-jinpings-leadership-style-micromanagement-that-leaves-underlings-scrambling-11639582426.
20    “Xi Says China Must Stick with Covid Zero Even as Costs Mount,” Bloomberg, April 14, 2022, https://www.bloomberg.com/news/articles/2022-04-14/xi-says-china-must-persist-with-covid-zero-even-as-costs-mount?sref=4LEYncfM.
21    China Daily, “Detection, Quarantine and Treatment Tried and Tested Response to Virus: China Daily Editorial,” Updated March 16, 2020, https://www.chinadaily.com.cn/a/202003/16/WS5e6f645ba31012821727f7d9.html.
22    Liu Xiaoming, “China Has Valuable Lessons for the World in How to Fight COVID-19,” Op-Ed, Financial Times, April 28, 2020, https://www.ft.com/content/ad61f0ea-8887-11ea-a109-483c62d17528.
23    Hu Xijin, “US Should Be Ashamed to Criticize China on Human Rights Considering Its Own COVID-19 Death Toll,” Global Times, Opinion, May 04, 2021, https://www.globaltimes.cn/page/202105/1222646.shtml.
24    “Unravel the Crippled U.S. Hegemony,” Xinhua, October 21, 2021, http://www.news.cn/english/2021-10/21/c_1310260311.htm
25    Eric Li, “Eric Li on the Failure of Liberal Democracy and the Rise of China’s Way,” By Invitation (Commentary series), Economist, December 7, 2021, https://www.economist.com/by-invitation/2021/12/08/eric-li-on-the-failure-of-liberal-democracy-and-the-rise-of-chinas-way.
26    Foreign Ministry, “President Xi Speaks to UN Secretary General on the Phone,” Embassy of the People’s Republic of China in the United States of America (website), https://www.mfa.gov.cn/ce/ceus/eng/zgyw/t1755477.htm.
27    Liu, “China Has Valuable Lessons.”
28    See, for example, “Foreign Ministry Spokesperson Zhao Lijian’s Regular Press Conference on March 4, 2020,” Ministry of Finance (website), Remarks, March 4, 2020; and Foreign Ministry Spokesperson’s Daily Briefing, Ministry of Finance (website), March 17, 2020, https://www.mfa.gov.cn/ce/ceke/eng/fyrth/t1752172.htm.
29    Foreign Ministry Daily Briefing, Ministry of Finance (website), March 24, 2020, https://www.fmprc.gov.cn/mfa_eng/xwfw_665399/s2510_665401/2511_665403/202003/t20200324_693148.html.
30    “Covid 19: 15 Truth [sic] You Need to Know,” China’s Ministry of Foreign Affairs (website), May 16, 2020, https://www.mfa.gov.cn/ce/cein//eng/xwfw/xxfb/t1779506.htm.
31    Zhao Lijian, (@zlj517), “2/2 CDC was caught on the spot. When did patient zero begin in US? How many people are infected? What are the names of the hospitals? It might be US army who brought the epidemic to Wuhan. Be transparent! Make public your data! US owe us an explanation!,” Twitter, March 12, 2020, https://twitter.com/zlj517/status/1238111898828066823.
32    Li Yang, (@Li_Yang_China), “The US has an obligation to explain this to the International community!!!,” Twitter, March 24, 2022, https://twitter.com/Li_Yang_China/status/1507155894286520320.
33    BBC, “Covid: Beijing City Urges End to Overseas Deliveries over Omicron,” January 17, 2022, https://www.bbc.com/news/world-asia-china-60023968.
34    Laura Silver, Kat Devlin, and Christine Huang, “Unfavorable Views of China Reach Historic Highs in Many Countries,” Pew Research Center, Report, October 6, 2020, https://www.pewresearch.org/global/2020/10/06/unfavorable-views-of-china-reach-historic-highs-in-many-countries/
35    Silver, Devlin, and Huang, “Unfavorable Views of China Reach Historic Highs.”
36    Salem Gebrekidan, Matt Apuzzo, Amy Qin, and Javier C. Hernandez, “In Hunt of Virus Source, W.H.O. Let China Take Charge,” New York Times, November 7, 2020, https://www.nytimes.com/2020/11/02/world/who-china-coronavirus.html.
37    Jeremy Page and Drew Hinshaw, “China Refuses to Give WHO Raw Data on Early Covid-19 Cases,” Wall Street Journal, Updated February 12, 2021, https://www.wsj.com/articles/china-refuses-to-give-who-raw-data-on-early-covid-19-cases-11613150580.
38    Tedros Adhanom Ghebreyesus, “WHO Director-General’s Remarks at the Member State Briefing on the Report of the International Team Studying the Origins of SARS-CoV-2,” WHO (website), March 30, 2021, https://www.who.int/director-general/speeches/detail/who-director-general-s-remarks-at-the-member-state-briefing-on-the-report-of-the-international-team-studying-the-origins-of-sars-cov-2.
39    Gabriel Crossley, “China Rejects WHO Plan for Study of COVID-19 Origins,” Reuters, June 23, 2021, https://www.reuters.com/world/china/china-will-not-follow-whos-suggested-plan-2nd-phase-covid-19-origins-study-2021-07-22/.
40    Li Yang, (@Li_Yang_China), Twitter, August 4, 2021, https://twitter.com/Li_Yang_China/status/1423091237087682561.
41    Yen Hee Lee, “Data Shows the U.S. Is the World’s Largest Covid Vaccine Donor–Way Ahead of China,” CNBC, September 9, 2021, https://www.cnbc.com/2021/09/09/covid-us-is-the-worlds-largest-donor-of-vaccines-data-shows.html.
42    “Full Text: Remarks by Chinese President Xi Jinping at the Global Health Summit,” Xinhua, May 21, 2021, http://www.xinhuanet.com/english/2021-05/21/c_139961512.htm.
43    “Indonesian President Receives 1st Chinese COVID-19 Vaccine Shot,” Xinhua, January 13, 2021, http://www.xinhuanet.com/english/2021-01/13/c_139663914.htm.
44    “WTO-IMF COVID-19 Vaccine Trade Tracker,” World Trade Organization (website), Last Updated March 1, 2022, https://www.wto.org/spanish/tratop_s/covid19_s/vaccine_trade_tracker_s.htm.
45    Martina E. McMenamin, et. al., “Vaccine Effectiveness of Two and Three Doses of BNT16262 and CoronaVac against COVID-19 in Hong Kong,” https://www.medrxiv.org/content/10.1101/2022.03.22.22272769v1.full-text.  University of Hong Kong media statement on results of joint study, Dec. 23, 2021, https://www.hku.hk/press/press-releases/detail/23804.html. Samuel M.S. Cheng, et. al., “Neutralizing Antibodies against the SARS-CoV-2 Omicron Variant BA.1 Following Homologous and Heterologous CoronaVac or BNT162b2 Vaccination,” https://www.nature.com/articles/s41591-022-01704-7, Nature Medicine, Jan. 20, 2022.
46    Regarding economic growth, the Chinese government announced 2021 growth at 8.1 percent, while the International Monetary Fund (IMF) estimated China’s growth at 7.9 percent. See Jonathan Cheng, “China GDP Grew 8.1% in 2021, though Momentum Slowed in Fourth Quarter,” Wall Street Journal, January 16, 2022, https://www.wsj.com/articles/china-gdp-grew-8-1-in-2021-though-momentum-slowed-in-fourth-quarter-11642386349; IMF, “People’s Republic of China, Staff Report for the 2021 Article IV Consultation,” Country Report (hereafter referred to as China AIV), January 28, 2022, 52, https://www.imf.org/en/Publications/CR/Issues/2022/01/26/Peoples-Republic-of-China-2021-Article-IV-Consultation-Press-Release-Staff-Report-and-512248; and for 2021 exports, see “China’s Trade Surplus Hit a Record $676 Billion in 2021,” Bloomberg, January 13, 2022, https://www.bloomberg.com/news/articles/2022-01-14/china-posts-record-trade-surplus-in-2021-on-soaring-exports?sref=E0nAM78N.
47    Lu Xiang, “More Negative Impact without Zero-COVID Policy,” Global Times, January 23, 2022, https://www.globaltimes.cn/page/202201/1246671.shtml.
48    For the impact on semiconductor production, see Joyce Lee and Manya Saini, “Samsung, Micron Warn Xian Shutdown May Disrupt Memory Chip Manufacturing,” Reuters, December 30, 2021, https://www.reuters.com/world/china/micron-warns-dram-chip-delays-due-chinas-xian-lockdown-2021-12-29/; and for the impact on automobile production, see “VW Is Latest Automaker Ensnared by Chinese Covid Plant Shutdowns,” Bloomberg, January 13, 2022, https://www.bloomberg.com/news/articles/2022-01-14/vw-shutters-factory-as-automakers-caught-in-china-covid-outbreak?sref=E0nAM78N.
49    “One of China’s Busiest Ports Jammed by Covid, Ship Delays,” Bloomberg, January 20, 2022, https://www.bloomberg.com/news/articles/2022-01-20/ship-arrivals-to-shenzhen-s-yantian-port-delayed-by-a-week?sref=E0nAM78N; and Weizhen Tan, “No Respite for China’s Stressed Out Supply Chains as Covid-Zero and New Year Holidays Take Toll,” CNBC, January 23, 2022, https://www.cnbc.com/2022/01/24/china-zero-covid-lockdowns-cny-holiday-impact-supply-chains-ports.html.
50    “China Reports First COVID Deaths in More than a Year,” Reuters, March 20, 2022, https://www.reuters.com/business/healthcare-pharmaceuticals/china-reports-first-covid-deaths-over-year-2022-03-19/.
52    Atlantic Council GeoEconomics Center and Rhodium Group, “China Pathfinder: Q4 2021 Update,” Atlantic Council, Issue Brief, January 31, 2022, https://www.atlanticcouncil.org/in-depth-research-reports/issue-brief/china-pathfinder-q4-2021-update/.
53    Logan Wright and Agatha Kratz, “The Gravity of Zero,” Rhodium Group, January 21, 2022.
54    “Kevin Yao and Stella Qiu “China Q1 GDP Tops Forecast, but March Weakness Raises Outlook Risks,” Reuters, April 18, 2022, https://www.reuters.com/world/china/chinas-q1-gdp-expands-48-yy-better-than-fcast-risks-outlook-abound-2022-04-18/.
56    Ji Siqi, “China’s Smallest Firms Failing at Historic Pace as 4.37 Million Close Up Shop and Registrations Plummet,” South China Morning Post, December 30, 2021, https://www.scmp.com/economy/china-economy/article/3161554/chinas-smallest-firms-failing-historic-pace-437-million-close.
57    Organisation for Economic Co-operation and Development, Financing SMEs and Entrepreneurs 2016, OECD, Annual Report, April 14, 2016, https://www.oecd-ilibrary.org/sites/fin_sme_ent-2016-12-en/index.html?itemId=/content/component/fin_sme_ent-2016-12-en.
58    IMF, China AIV, 8.
59    “Unemployment on the Rise in China as Covid Takes Its Toll,” Standard, March 15, 2022,  https://www.thestandard.com.hk/breaking-news/section/3/188130/Unemployment-on-the-rise-in-China-as-Covid-takes-its-toll%C2%A0.
60    Regarding the January contraction, see “China’s Jan Factory Activity Contracts as COVID Lockdowns Bit—Caixin PMI,” Reuters, January 29, 2022, https://www.reuters.com/markets/europe/chinas-jan-factory-activity-contracts-covid-lockdowns-bite-caixin-pmi-2022-01-30/; for February growth and export orders, see “China’s Caixin Manufacturing PMI Signals Slight Improvement in February,” Dow Jones Newswires, February 28, 2022,  https://www.marketwatch.com/story/china-caixin-manufacturing-pmi-signals-slight-improvement-in-february-271646100514; for March export orders, see Jonathan Cheng, “Covid-19 Outbreaks Slow Factory Activity in China,” Wall Street Journal, March 31, 2022, https://www.wsj.com/articles/covid-19-outbreaks-slow-factory-activity-in-china-11648712023.
61    IMF, China AIV, 13.
62    IMF, WEO, 6; Evelyn Cheng, “China Sets GDP Target of ‘Around 5.5%’ for 2022,” CNBC, March 4, 2022,  https://www.cnbc.com/2022/03/05/china-on-deck-to-reveal-its-2022-gdp-target.html.
63    For the earlier IMF forecast, see IMF, “World Economic Outlook Update,” January 2022, 3, https://www.imf.org/en/Publications/WEO/Issues/2022/01/25/world-economic-outlook-update-january-2022. For the impact of zero-COVID in the latest forecast, see IMF, WEO, 3.
64    “Xi Reshapes China’s Property Market Paving Way for State Dominance,” Bloomberg, January 13, 2022,  https://www.bloomberg.com/news/articles/2022-01-13/china-s-property-market-is-set-for-state-dominated-age-of-rust?sref=E0nAM78N.
65    IMF, China AIV, 36-37.
66    For LGFV debt exposure, see Shuli Ren, “China’s Local Governments Are at Risk of a Puerto Rico Moment,” Bloomberg Businessweek, January 31, 2022, https://www.bloomberg.com/news/articles/2022-01-31/china-s-local-governments-risk-collapse-due-to-slow-economy-real-estate-slump?sref=E0nAM78N; and for home purchase presales, see IMF, AIV, 37.
67    Rebecca Chong Wilkins, “Evergrande Declared in Default as Huge Restructuring Looms,” Bloomberg, December 9, 2021, https://www.bloomberg.com/news/articles/2021-12-09/evergrande-defaults-for-first-time-as-china-debt-strains-spread?sref=E0nAM78N\.
68    Andy Lin, Thomas Hale, and Hudson Lockett, “Half of China’s Top Developers Crossed Beijing’s Red Lines,” Financial Times, October 8, 2021, https://www.ft.com/content/d5803d64-5cc5-46f0-bed0-1bc207440f9c.
69    “China Corporate Bond Default Rate Set to Rise in 2022,” Fitch Ratings, January 27, 2022, https://www.fitchratings.com/research/corporate-finance/china-corporate-bond-default-rate-set-to-rise-in-2022-27-01-2022.
70    Reuters, “China Plans to Relax ‘Three Red Lines’ to Encourage State-Led Property M&A: REDD,” January 6, 2022, https://www.reuters.com/markets/deals/china-plans-relax-three-red-lines-encourage-state-led-property-ma-redd-2022-01-07/.
71    For the impact on the property and construction sectors, see “China’s Surprise Growth Spurt Likely Short-Lived as Covid Spikes,” Bloomberg, March 14, 2022, https://www.bloomberg.com/news/articles/2022-03-15/china-s-economy-starts-year-strongly-as-covid-and-war-risks-loom?sref=E0nAM78N; “China Will Not Expand Its Property Tax Trial This Year,” Bloomberg, March 16, 2022, https://www.bloomberg.com/news/articles/2022-03-16/china-will-not-expand-its-property-tax-trial-this-year-l0tex2zh?sref=E0nAM78N; and “China Credit Growth Slows More than Expected Despite Easing,” Bloomberg, March 11, 2022, https://www.bloomberg.com/news/articles/2022-03-11/china-s-credit-expansion-slows-in-seasonally-weak-month?sref=E0nAM78N.
74    Amy Qin and Keith Bradsher, “Omicron Deepens Uncertainty Surrounding Beijing Olympics,” New York Times, January 12, 2022, https://www.nytimes.com/2022/01/12/world/asia/beijing-olympics-covid.htm; and Yanzhong Huang, “China’s Immunity Gap,” Foreign Policy, January 26, 2022, https://www.foreignaffairs.com/articles/china/2022-01-26/chinas-immunity-gap.
75    Jonathan Cheng, “China’s ‘Common Prosperity’ to Squeeze Cash-Strapped Local Governments,” Wall Street Journal, January 25, 2022, https://www.wsj.com/articles/chinas-common-prosperity-to-squeeze-cash-strapped-local-governments-11643115843.
76    “Property Crisis Means Chinese Cities Sell Land to Themselves,” Bloomberg, January 25, 2022,  https://www.bloomberg.com/news/articles/2022-01-25/shadowy-china-firms-spend-billions-on-land-shunned-by-developers?sref=E0nAM78N.
77    Jeremy Mark, “Evergrande’s Place in China’s House of Cards,” Atlantic Council, September 21, 2021, https://www.atlanticcouncil.org/blogs/new-atlanticist/evergrandes-place-in-chinas-house-of-cards; and Li Yuan, “As Beijing Takes Control, Chinese Tech Companies Lose Jobs and Hope,” New York Times, January 5, 2022,
78    IMF, China AIV, 4.
79    PBOC Gives Clear Easing Signal with Promise to Boost Growth,” Bloomberg, January 18, 2022,  https://www.bloomberg.com/news/articles/2022-01-18/pboc-says-market-forces-policy-will-help-correct-any-yuan-moves?sref=E0nAM78N
80    Saheli Roy Choudhury, “China’s Central Bank Cuts Key Lending Rates, Including One for the First Time in Nearly 2 Years,” CNBC, January 19, 2022, https://www.cnbc.com/2022/01/20/china-economy-pboc-cuts-loan-prime-rates-lpr-for-1-year-5-year.html.
81    China Central Bank Holds Interest Rate with Focus Now on RRR,” Bloomberg, April 14, 2022, https://www.bloomberg.com/news/articles/2022-04-15/china-s-central-bank-unexpectedly-keeps-policy-rate-unchanged?srnd=premium-asia&sref=E0nAM78N.
82    For the NPC announcement, see Tom Hancock, “China Puts Tough Reforms on Hold to Focus on Growth: NPC Roundup,” Bloomberg, March 10, 2022, https://www.bloomberg.com/news/articles/2022-03-10/china-puts-tough-reforms-on-hold-to-focus-on-growth-npc-roundup?sref=E0nAM78N; for the impact on local government revenue, see “China Fiscal Aid Little Comfort for Cash-Strapped Provinces,” Bloomberg, March 8, 2022, https://www.bloomberg.com/news/articles/2022-03-08/china-s-fiscal-aid-is-little-comfort-for-cash-strapped-provinces?sref=E0nAM78N.
83    “Opinion: Expanding New Infrastructure Helps Stabilize China’s Economic Growth,” Yicai Global, February 9, 2022, https://www.yicaiglobal.com/news/opinion-expanding-new-infrastructure-helps-stabilize-china-economic-growth. The Trump administration designated Yicai Global a Chinese foreign mission.
84    Hong Kong- and New York-listed Chinese shares were especially pummeled. See Jeanny Yu and Charlotte Yang, “Panic Selling Grips Chinese Stocks in Biggest Plunge Since 2008,” Bloomberg, March 13, 2022,  https://www.bloomberg.com/news/articles/2022-03-14/china-s-tech-rout-deepens-amid-lockdown-geopolitical-worries?sref=E0nAM78N.
85    China Makes Strong Vow to Ease Crackdowns After Market Turmoil,” Bloomberg, March 13, 2022,  https://www.bloomberg.com/news/articles/2022-03-16/china-vows-to-keep-markets-stable-and-handle-developers-risks?sref=E0nAM78N.
86    “China Will Not Expand Its Property Tax Trial This Year,” Bloomberg, March 16, 2022, https://www.bloomberg.com/news/articles/2022-03-16/china-will-not-expand-its-property-tax-trial-this-year-l0tex2zh?sref=E0nAM78N.
87    China Pledges to Stabilize the Economy and Plan for Uncertainty,” Bloomberg, March 30, 2022, https://www.bloomberg.com/news/articles/2022-03-30/china-pledges-to-stabilize-economy-and-plan-for-uncertainty?sref=E0nAM78N; and “China’s Li Issues Third Growth Warning as Covid Takes Toll,” Bloomberg, April 11, 2022, https://www.bloomberg.com/news/articles/2022-04-12/china-s-li-issues-third-warning-on-growth-as-covid-takes-toll?sref=E0nAM78N.
88    William Shakespeare, “Hamlet,” Act III, Scene 1.
89    Ann Koh and Kevin Varley, “U.S. Goods Risk Being Late as China’s Lockdowns Worsen Shipping Port Jams,” Bloomberg, March 24, 2022, https://www.bloomberg.com/news/articles/2022-03-24/china-port-jams-at-five-month-high-pose-risk-to-u-s-deliveries?sref=E0nAM78N.
90    For port wait times, see Joe Brock, “COVID Curbs Bite at Chinese Ports, Threatening Global Supply Chains,” Reuters, March 16, 2022, https://www.reuters.com/business/covid-curbs-bite-chinese-ports-threatening-global-supply-chains-2022-03-16/; for air freight costs, see Weizhen Tan, “No Respite for China’s Stressed-Out Supply Chains as Covid-Zero and New Year Holidays Take a Toll,” CNBC, January 23, 2022, https://www.cnbc.com/2022/01/24/china-zero-covid-lockdowns-cny-holiday-impact-supply-chains-ports.html.
91    Liza Lin and Yang Jie, “Shanghai’s Covid Lockdown Leads to Logistics Disarray, with Quarantined Truckers, Piled-Up Containers,” Wall Street Journal, April 21, 2022, https://www.wsj.com/articles/shanghai-lockdown-leads-to-logistics-disarray-with-quarantined-truckers-piled-up-containers-11650537303.
92    Costas Paris, “China’s Bet on Sending Its Exports through Russia Hits Setback,” Wall Street Journal, April 2, 2022, https://www.wsj.com/articles/chinas-bet-on-sending-its-exports-through-russia-hits-setback-11648908000.
94    China Meets with Foreign Chambers as Lockdowns Hit Business,” Bloomberg, April 18, 2022, https://www.bloomberg.com/news/articles/2022-04-18/china-meets-with-foreign-chambers-as-lockdowns-hit-business?sref=E0nAM78N.
96    Stephen Lamar, Interview by Michael Schuman, February 8, 2022.
97    IMF, “Rising Caseloads, a Disrupted Recovery, and Higher Inflation,” World Economic Outlook Update, January 2022, https://www.imf.org/en/Publications/WEO/Issues/2022/01/25/world-economic-outlook-update-january-2022; for semiconductors and inflation, see Fernando Leibovici and Jason Dunn, “Supply Chain Bottlenecks and Inflation: The Role of Semiconductors,” Federal Reserve Bank of St. Louis, Economic Synopses 2021, no. 28, December 16, 2021, https://research.stlouisfed.org/publications/economic-synopses/2021/12/16/supply-chain-bottlenecks-and-inflation-the-role-of-semiconductors; for food prices and supply chains, see US Chamber of Commerce, “4 Factors Driving Food Price Inflation,” November 10, 2021, https://www.uschamber.com/economy/4-factors-driving-food-price-inflation.
98    IMF, WEO, 18.
99    State Council Information Office of the Peoples Republic of China “国新办举行从严抓好疫情防控工作新闻发布会图文实录” (“The State Council Information Office Held a Press Conference on Strict Efforts to Prevent and Control the Epidemic,”) March 18, 2022, http://www.scio.gov.cn/xwfbh/xwbfbh/wqfbh/47673/48041/wz48043/Document/1721891/1721891.htm.

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Aviso LatAm: COVID-19 May 7, 2022 https://www.atlanticcouncil.org/content-series/aviso-latam-covid-19/aviso-latam-covid-19-may-7-2022/ Sat, 07 May 2022 17:30:00 +0000 https://www.atlanticcouncil.org/?p=521230 "Staggering inequality" is the core factor behind the region’s disproportionate COVID-19 deaths according to a new Amnesty International report. LAC accounts for 8.4 percent of the global population and 28 percent of coronavirus mortality.

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​​​​​What you should know

  • Chile: President Boric aims to tame surging fuel costs that have driven annual inflation to a 14-year high, as global commodity costs spike in the aftermath of Russia’s invasion of Ukraine.
  • New normal: Countries have lifted mask mandates and restrictions on mass gatherings and travel requirements after two years.
  • “Staggering inequality”The core factor behind the region’s disproportionate COVID-19 deaths according to a new Amnesty International report. LAC accounts for 8.4 percent of the global population and 28 percent of coronavirus mortality.

Monitoring COVID-19 economic recovery in the region

  • Chile: March GDP expanded 7.2 percent, above market expectations due mostly to post-pandemic reopenings and relative stabilization of goods prices.  
  • Colombia: The Central Bank raised benchmark rates to 6 percent to combat inflation.
  • Mexico: According to numbers released by INEGI, the national statistical agency, March trade balance was $1.1 billion lower than in February. This dip in the trade surplus reflects March’s low non-oil exports and an overall stalled recovery.
  • Brazil: Amid electoral uncertainties and international turmoil around Russia’s invasion of Ukraine, growth remains weak­ (forecasted as 0.3 percent for 2022 due to inflation)
  • Venezuela: Emboldened by surging oil exports that are fueling economic growth and helping keep the foreign-exchange rate steady, the government is pushing citizens to use the Bolivar more by implementing a 3 percent tax on US dollars.

In focus: The rise of crypto in LAC

In 2021, El Salvador became the first country in the world to authorize the use of bitcoin as a legal tender. Despite a lukewarm response from Salvadorian businesses and investors, the Panamanian Congress ratified a law approving the use of bitcoin and eight other cryptocurrencies for paying taxes and for paying transactions—the legislation is now waiting for presidential approval.  

Argentina’s largest private bank, Banco Galicia, and Brubank SAU, announced that they will allow customers to purchase cryptocurrencies starting May 2, 2022.  As bitcoin usage and adoption spreads across the region, the International Monetary Fund urged El Salvador to remove Bitcoin’s legal status, citing  “large risks for financial and market integrity, financial stability, and consumer protection”. 

Health + Innovation

  • 25 percent: The share of COVID-19 deaths reported globally between April 25 – May 2 that was from the Americas.
  • COVAX: In the agency’s latest allocation, Mexico will not receive Pfizer vaccines to inoculate minors. Health officials are exploring new alternatives, including direct contracts with Pfizer and Cuba for its Abdala vaccine.
  • May 12: The date Belize, Germany, Indonesia, Senegal, and the United States, will host the second global COVID-19 summit.

Expert take: CARICOM at the forefront of the second global COVID summit

Belize’s inclusion as a co-chair of the second global COVID summit is a model for how to use multilateral channels to address shared, international challenges. Belize is the current Chair of the Caribbean Community (CARICOM) – a group of 14 independent Caribbean countries – and will be tasked with representing the views of a region that is among the most vulnerable to the pandemic’s health and economic effects. Most CARICOM members are dependent on tourism – which came to a halt during the pandemic – and are reliant on importing medical equipment and services. Therefore, working with allies and adopting a regional approach to the pandemic was a necessity for CARICOM countries. This is the perspective that Belize will bring to the Summit. It will emphasize the importance of regional coordination and elevate the views of small states, ensuring that commitments resulting from the Summit account for the unique challenges facing other developing countries. In many ways, the inclusion of the CARICOM chair can be a blueprint for how the world addresses other global challenges, like the ongoing energy crisis and climate change.

  • Wazim Mowla, Assistant Director of the Adrienne Arsht Latin America Center’s Caribbean Initiative

Geopolitics of vaccine donations: US vs. China

  • The United States outpaces China in its donations of COVID-19 vaccines to Latin America and the Caribbean, with Colombia and Mexico topping the list. The region has received roughly 52 percent of all US COVID-19 vaccine donations. To learn more, visit our COVID-19 vaccine tracker: Latin America and the Caribbean.

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Africa Center’s 2022 Spring Meeting Dialogues https://www.atlanticcouncil.org/commentary/event-recap/africa-centers-2022-spring-meeting-dialogues/ Fri, 06 May 2022 17:06:54 +0000 https://www.atlanticcouncil.org/?p=520592 With the IMF and World Bank Group Spring Meetings taking place from April 18th to the 22nd, the Africa Center convened the timely “2022 Spring Meeting Dialogues”, highlighting African views during the strategic gatherings around development matters.

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With the IMF and World Bank Group Spring Meetings taking place from April 18th to the 22nd, the Africa Center convened the timely “2022 Spring Meeting Dialogues”, highlighting African views during the strategic gatherings around development matters. The events spotlighted valuable perspectives with key speakers, including Mr. Scott Nathan, CEO of the US International Development Finance Corporation, H.E. Mr. Anatole Collinet Makosso, Prime Minister of the Republic of Congo, Dr. Akinwumi Adesina, President of the African Development Bank, H.E. Dr. Situmbeko Musokotwane Finance Minister to the Republic of Zambia, H.E. Mr. Saulos Klaus Chilima Vice President of the Republic of Malawi, Mr. Alphonse Kouagou Executive Director of the World Bank Africa Group II, and Dr. Albert Zeufack Chief Economist with the World Bank Group Africa Group II.

“67% of all of AfDB climate finance goes toward adaptation frameworks, specifically in supporting the development of climate resilient infrastructures.”

 “In Congo the people finance all infrastructure projects, of which the same resources will be used to finance development and construction of infrastructure obliging Congolese to face indebtment.”

“We need more private actors, commercial and bankable projects, in order to create sustainable long term solutions through interagency partnerships.”

“Zambia is working very hard on creating conditions that are conducive within the country for the production of electrical motors to be produced internally.”

“The pandemic created an opportunity, presenting the potential to improve our health systems throughout Africa which has shifted the World Bank’s focus on investing in facilities to produce vaccine from the continent.”

“The Ukraine crisis has presented an opportunity to produce wheat and soya products for consumption, and possibilities for export, while there is a downsize in terms of other commodities to replace what revenue is grossly affected.”

 “What is clear from the Ukraine crisis is the direct exposure of African economies to the situation is not as deep as it seems, however the global inflation caused by the war is impacting the continent’s economies regardless where urban areas are affected most.”

Find the Spring 2022 Meeting Dialogues recap below!

Watch the full events below.

Events

May 6, 2022

A conversation with Alphonse Kouagou Executive Director of the World Bank Africa Group II, and Albert Zeufack Chief Economist with the World Bank Group

Discussion on “2022 Spring Meeting Dialogues”, highlighting African views during the strategic gatherings around development matters.

Africa Civil Society

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Aviso LatAm: COVID-19 April 23, 2022 https://www.atlanticcouncil.org/content-series/aviso-latam-covid-19/aviso-latam-covid-19-april-23-2022/ Sat, 23 Apr 2022 07:35:00 +0000 https://www.atlanticcouncil.org/?p=516117 Over two-thirds of people in Latin America and the Caribbean are fully vaccinated

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​​​​​What you should know

  • Over two-thirds: The share of people in Latin America and the Caribbean (LAC) that have received two COVID-19 vaccine doses.
  • PAHO: COVID-19 cases and deaths declined in the Americas despite increases in North America.
  • Second COVID-19 summit: Co-hosted by Belize, Germany, Indonesia, Senegal, and the United States, this global gathering intends to build momentum for vaccine donations and end the “acute phase” of the pandemic.

Monitoring COVID-19 economic recovery in the region

  • Colombia: According to the national statistical agency (DANE), economic activity continues to increase. The February 2022 Economic Activity Indicator expanded 8.1 percent year-on-year (y/y) across all sectors.   
  • Peru: February GDP growth reached the highest rate in five months, totaling a 4.9 percent y/y increase. However, according to the National Statistics Institute (INEI), demand for construction fell 2.5 percent y/y, reflecting low private and public investment in infrastructure and residential construction projects.  
  • Chile: Inflation rate in March exceeded the highest projections by 0.7 percent to 1.9 percent month-to-month (m/m). This spike reflects overall increases in food, energy, and core good prices. 
  • Mexico: According to the National Institute of Statistics and Geography (INEGI), y/y inflation rate in March reached the highest levels since 2001. Scotiabank analysts expect inflation to hit 8.3 percent by the end of the year.
  • Guyana: Cumulative economic growth rate since the onset of the pandemic reached 72 percent—highest among all countries in the region—thanks to offshore oil discoveries.

In focus: Inflationary shocks strike Latin America and the Caribbean

Inflation among Latin America’s largest economies reached its highest levels in 15 years. According to the World Bank, energy and food were the main contributors to inflation in 2021, accounting for more than 90 percent of inflation in Costa Rica, 75 percent in Paraguay, and 66 percent in Brazil.  Projections suggest that inflation will increase further in 2022 due mainly to rising global commodity prices, supply chain disruptions, and the Russia-Ukraine War.

A cause for concern: The reverberations of high inflation in the region are regressive, with low income households expected to experience steeper costs-of-living. This could exacerbate already prevalent social discontent.

Health + Innovation

  • P.1 variant: The highly contagious Brazilian variant is driving the surge in cases in South America and some Caribbean countries. Cumulative cases in the sub-region are approaching 23 million.
  • Brazil: The Butantan Institute and Fiocruz Health Institute face supply constraints amid mounting pressure to scale up vaccine roll-out.
  • Covaxin: Ocugen, a biotechnology company, gained rights to market its COVID-19 vaccine in Mexico following Emergency Use Authorization from health authorities.
  • Mexico: Senior government officials confirmed that certain groups of people may be eligible to receive a second COVID-19 booster shot.

Geopolitics of vaccine donations: US vs. China

  • The United States outpaces China in its donations of COVID-19 vaccines to Latin America and the Caribbean, with Colombia and Mexico topping the list. The region has received roughly 52 percent of all US COVID-19 vaccine donations. To learn more, visit our COVID-19 vaccine tracker: Latin America and the Caribbean.

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Aviso LatAm: COVID-19 April 13, 2022 https://www.atlanticcouncil.org/content-series/aviso-latam-covid-19/aviso-latam-covid-19-april-13-2022/ Wed, 13 Apr 2022 07:26:00 +0000 https://www.atlanticcouncil.org/?p=511546 67.6 percent of the region's population is fully vaccinated

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​​​​​What you should know

  • 67.6 percent: The share of Latin America and the Caribbean’s population that is fully vaccinated against COVID-19.
  • BRICS: Brazil, Russia, India, China, and South Africa launched a Vaccine Research and Development Centre to promote cooperation in the development and production of COVID-19 vaccines—a move that will increase vaccine distribution and access for Brazil and the region at-large.
  • Learning crisis: A new report revealed that schools in middle-income Latin America remained closed the longest globally (75 weeks and over), setting students behind by 12 months.
  • Costa Rica: Economist Rodrigo Chaves will take office as President on May 4, amid growing social discontent and concerns over national debt.

Monitoring COVID-19 economic recovery in the region

  • Chile: While GDP expanded 6.8 percent year-to-year (y/y) in February, non-mining activity dropped 0.8 percent month-to-month (m/m) and services declined 1.2 percent, signaling weaker activity and possible technical recession on the eve of the constitutional referendum.
  • Peru: In March, inflation rates reached a 28-year high following a 1.5 percent m/m increase. The government also announced fuel and food tax cuts as farmer and trucker demonstrations escalate across the country.  
  • Colombia: February employment data indicated that labor participation and job recovery are returning to pre-Covid levels. Two of three recovered jobs went to women.  
  • Mexico: The trade balance in February rebounded to a $1.3 billion surplus following January’s record-level, omicron-induced deficit.
  • Venezuela: Petroleum exports decreased 4 percent m/m in March after customers returned crude cargoes due to poor oil quality.

In focus: Latin America and the Caribbean’s protagonism in nearshoring efforts

Latin America and the Caribbean (LAC) is increasingly becoming a destination for companies seeking to circumvent global supply chain disruptions. U.S. toy-producer, Mattel, is the latest company to nearshore its operations, announcing a $50 million plan to expand its manufacturing plant in Monterrey, Mexico. The new site in the State of Nuevo Leon will overtake the company’s other manufacturing hubs in China, Vietnam, and Malaysia and become the company’s largest production center. Similarly, U.S. clothing retailer GAP Inc. announced it will shift its sourcing away from Southeast Asia in favor of Mexico and Central America. Factory closures and port congestions in Vietnam had prompted a hike in transportation costs.

Health + Innovation

  • Saint Lucia: Officials rescinded pre-entry COVID-19 testing requirements for fully vaccinated visitors following a decrease in cases.
  • Colombia: The government is facing calls to issue a compulsory license, allowing public agencies and drugmakers to get license-free access to the Pfizer COVID-19 pill.
  • Uruguay: President Luis Lacalle Pou announced the end of the national health emergency first established in 2020, following pandemic easing.
  • Bolivia: Nearly 50 percent of the population has received a second COVID-19 vaccine dose while virus-related mortality rates remain at 0.6 percent.
  • Vaccines: Mexico’s representative to the World Trade Organization (WTO) said that any WTO COVID-19 immunizations agreement should go beyond intellectual property waivers.
  • CDC: Seven countries in the region were moved down from Level 4 to Level 3 travel advisory, an indication of pandemic easing.

Vaccination by the numbers

Percentage of population with booster shot: Chile (87) #1 worldwide, Uruguay (66) #6 worldwide, Cuba (56) #20 worldwide, Argentina (44) #40 worldwide, Peru (43) #43 worldwide, Brazil (39) #45 worldwide, Costa Rica (39) #47 worldwide, Panama (35) #53 worldwide, Ecuador (31) #59 worldwide, El Salvador (26) #70 worldwide, Dominican Republic (22) #72 worldwide. Source: nytimes.com

Percentage of population fully vaccinated: Chile (92) #4 worldwide, Cuba (88) #8 worldwide, Argentina (82) #18 worldwide, Uruguay (82) #19 worldwide, Peru (81) #22 worldwide, Ecuador (80) #27 worldwide, Costa Rica (79) #28 worldwide, Brazil (77) #36 worldwide, Panama (72) #49 worldwide, Colombia (70) #55 worldwide. Source: nytimes.com

Geopolitics of vaccine donations: US vs. China

  • The United States outpaces China in its donations of COVID-19 vaccines to Latin America and the Caribbean, with Colombia and Mexico topping the list. The region has received roughly 52 percent of all US COVID-19 vaccine donations. To learn more, visit our COVID-19 vaccine tracker: Latin America and the Caribbean.

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Brooks in the Washington Post on the threat of disease in Ukraine https://www.atlanticcouncil.org/insight-impact/in-the-news/brooks-in-the-new-york-times-on-the-threat-of-disease-in-ukraine/ Tue, 05 Apr 2022 19:22:00 +0000 https://www.atlanticcouncil.org/?p=510647 Max Brooks discusses the threat of disease outbreak and biological warfare in Ukraine.

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On April 5, Forward Defense nonresident senior fellow Max Brooks co-authored an article in the Washington Post with Lionel Beehner and John Spencer, titled, “Opinion: Ukrainians should be on the lookout for a new battlefield enemy: Disease.” The authors discuss the threat of disease outbreak and biological warfare in Ukraine, and recommend emergency sanitation supplies and hygiene manuals to build up resilience.

If we want to help the Ukrainian resistance, we shouldn’t be sending them only Javelins and body armor. 

Max Brooks, Lionel Beehner, and John Spencer in the Washington Post

Forward Defense, housed within the Scowcroft Center for Strategy and Security, generates ideas and connects stakeholders in the defense ecosystem to promote an enduring military advantage for the United States, its allies, and partners. Our work identifies the defense strategies, capabilities, and resources the United States needs to deter and, if necessary, prevail in future conflict.

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Pavel in Vox on bioterrorism threats https://www.atlanticcouncil.org/insight-impact/in-the-news/pavel-in-vox-on-bioterrorism-threats/ Tue, 05 Apr 2022 19:04:00 +0000 https://www.atlanticcouncil.org/?p=510600 Barry Pavel warns that acts of bioterrorism will become more frequent as technology progresses and barriers to entry decrease.

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On April 5, Atlantic Council senior vice president and Scowcroft Center director Barry Pavel was quoted in a Vox article titled, “Why experts are terrified of a human-made pandemic — and what we can do to stop it.” Pavel warns that acts of bioterrorism will become more frequent as technology progresses and barriers to entry decrease.

Forward Defense, housed within the Scowcroft Center for Strategy and Security, generates ideas and connects stakeholders in the defense ecosystem to promote an enduring military advantage for the United States, its allies, and partners. Our work identifies the defense strategies, capabilities, and resources the United States needs to deter and, if necessary, prevail in future conflict.

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Aviso LatAm: COVID-19 March 29, 2022 https://www.atlanticcouncil.org/content-series/aviso-latam-covid-19/aviso-latam-covid-19-march-29-2022/ Tue, 29 Mar 2022 10:55:00 +0000 https://www.atlanticcouncil.org/?p=505844 248 million people in Latin America and the Caribbean have yet to receive a single COVID-19 vaccine dose

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​​​​​What you should know

  • 248 million: The number of people in Latin America and the Caribbean (LAC) that have yet to receive a single COVID-19 vaccine dose.
  • Mexico-Russia: President Andrés Manuel López Obrador is moving forward with a plan to domestically package Sputnik V COVID-19 vaccines.
  • Paxlovid: Thirty-five companies signed agreements with Pfizer for its newly licensed oral COVID-19 treatment, allowing for production of a generic, low-cost version in low-income nations. 

Monitoring COVID-19 economic recovery in the region

  • Argentina: The Senate signed an agreement with the International Monetary Fund (IMF) to refinance $44 billion in debt days before a potential default. The agreement comes after a 4.7 percent increase in consumer prices in February, compared to 3.9 percent in January. The 12-month rolling inflation hit 52.3 percent in February. 
  • Brazil: The Central Bank raised interest rates to 11.75 percent and indicated its intent to end the aggressive cycle of interest rate increases during its next meeting in May.
  • Chile: GDP growth slowed in Q4 despite record growth in 2021. Higher private consumption increased the imports of durable goods, expanding the current account deficit to -6.6 percent of GDP up from -1.7 percent in 2020.
  • Colombia: The National Statistics Administrative Department (DANE) published its January 2022 survey of economic activity, indicating continued growth amid economic recovery.  Beverages, pharmaceutical products, and paper-related products were the best-performing industries, accounting for 30 percent of overall growth.
  • Peru: An ease of COVID-19 mobility restrictions and the reactivation of hospitality and transportation industries contributed 1.2 percentage points to January’s 2.9 percent GDP increase. However, uncertainty within the political environment caused a credit rating downgrade to BBB by Standard & Poor.

In focus: Reverberations of the Russian invasion of Ukraine in regional economies

Increased global commodity prices resulting from the Russian invasion of Ukraine could produce short-term benefits for the region’s commodity exporters. However, these gains will likely be counterbalanced by rising inflation and supply-chain disruptions. While Latin America is less reliant on Ukrainian and Russian wheat exports relative to Africa and the Middle East, skyrocketing fertilizer prices could significantly hurt Latin American agricultural producers and raise food prices regionally. Brazil, the world’s largest fertilizer importer, has begun to push local fertilizer output as global prices soar.

Higher import prices may affect not only net oil importers like Chile, but crude oil exporters like Colombia. Argentina and Ecuador, which had planned to cut fuel subsidies this year to comply with IMF conditionality, could now be faced with a difficult choice amid higher prices. According to the IMF, Latin America’s poorest countries will be hardest hit by the conflict-driven economic fallout due to inflationary pressures and increased food prices.

Health + Innovation

  • Caribbean: Ten countries have yet to reach the World Health Organization’s (WHO) goal of 40 percent vaccination coverage in 2021.
  • Trinidad and Tobago: The latest country to announce the relaxation of COVID-19 restrictions.
  • Mexico: Government officials reported 1,684 new confirmed cases, the lowest single-day count in 2022 so far, bringing the total number of confirmed cases to 5,566,669.
  • 10,000: The number of COVID-19 vaccine doses Taiwan donated to Saint Lucia and St. Vincent and the Grenadines to help Caribbean allies combat the pandemic.
  • Brazil: Following determinations from its scientific committee, Rio de Janeiro is relaxing the use of masks as the COVID-19 pandemic wanes.

Vaccination by the numbers

Percentage of population with booster shot: Chile (81) #1 worldwide, Uruguay (62) #9 worldwide, Cuba (54) #18 worldwide, Argentina (41) #40 worldwide, Brazil (35) #46 worldwide, Peru (34) #47 worldwide, Panama (33) #49 worldwide, Costa Rica (32) #51 worldwide, Ecuador (29) #62 worldwide, El Salvador (23) #69 worldwide, Dominican Republic (21) #70 worldwide. Source: nytimes.com

Percentage of population fully vaccinated: Chile (91) #6 worldwide, Cuba (87) #8 worldwide, Argentina (82) #15 worldwide, Uruguay (82) #16 worldwide, Ecuador (79) #27 worldwide, Peru (79) #31 worldwide, Costa Rica (77) #32 worldwide, Brazil (75) #38 worldwide, Panama (70) #50 worldwide, Colombia (68) #55 worldwide. Source: nytimes.com

Geopolitics of vaccine donations: US vs. China

  • The United States outpaces China in its donations of COVID-19 vaccines to Latin America and the Caribbean, with Colombia and Mexico topping the list. The region has received roughly 52 percent of all US COVID-19 vaccine donations. To learn more, visit our COVID-19 vaccine tracker: Latin America and the Caribbean.

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Nabi in World Economic Forum: We need global solutions for global challenges – why Omicron is a lesson for us all  https://www.atlanticcouncil.org/insight-impact/in-the-news/nabi-in-world-economic-forum-we-need-global-solutions-for-global-challenges-why-omicron-is-a-lesson-for-us-all/ Thu, 17 Mar 2022 20:17:57 +0000 https://www.atlanticcouncil.org/?p=501007 "Many “nation-first” leaders in the Global North did not recognize the impact of connectivity sooner, directly leading to the uncontrollable spread of the coronavirus and the development of novel variants" writes Junaid Nabi

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“The emergence of the Omicron variant in the COVID-19 pandemic illustrates that the world is increasingly connected. The reality is that it is almost impossible to contain a virus in one country or region, and soon it will spread everywhere. Therefore, leaders from all countries must develop global solutions for the management of pandemics.”

Read more about our expert

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Aviso LatAm: COVID-19 March 13, 2022 https://www.atlanticcouncil.org/content-series/aviso-latam-covid-19/aviso-latam-covid-19-march-13-2022/ Sun, 13 Mar 2022 13:29:56 +0000 https://www.atlanticcouncil.org/?p=499130 65.5 percent of the region's population is fully vaccinated

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​​​​​What you should know

  • 65.5: The share of Latin America and the Caribbean’s population that is fully vaccinated.
  • PAHO: New COVID-19 cases in the Americas dropped by 32 percent in the last week, while deaths fell by 10 percent.
  • 6 million: The global COVID-19 death toll as the pandemic enters its third year—Brazil has recorded 652,400 confirmed deaths, the second highest in the world.

Vaccination by the numbers

Percentage of population with booster shot: Chile (77) #1 worldwide, Uruguay (56) #17 worldwide, Cuba (53) #20 worldwide, Argentina (38) #41 worldwide, Brazil (32) #48 worldwide, Peru (32) #49 worldwide, Panama (28) #57 worldwide, Costa Rica (26) #61 worldwide, Ecuador (24) #67 worldwide, El Salvador (22) #68 worldwide, Dominican Republic (21) #69 worldwide, Colombia (16) #71 worldwide. Source: nytimes.com

Percentage of population fully vaccinated: Chile (91) #5 worldwide, Cuba (87) #7 worldwide, Argentina (81) #17 worldwide, Uruguay (79) #24 worldwide, Ecuador (78) #27 worldwide, Costa Rica (76) #31 worldwide, Peru (75) #37 worldwide, Brazil (74) #41 worldwide, Colombia (66) #59 worldwide, El Salvador (66) #61 worldwide. Source: nytimes.com

Vaccinations per capita (vaccines administered per 100 people): Cuba (309) #1 worldwide, Chile (259) #2 worldwide, Uruguay (220) #14 worldwide, Argentina (209) #25 worldwide, Peru (192) #38 worldwide, Brazil (187) #40 worldwide, Costa Rica (185) #42 worldwide, Ecuador (184) #44 worldwide, Panama (165) #58 worldwide, El Salvador (159) #62 worldwide, Colombia (152) #65 worldwide. Source: nytimes.com

Geopolitics of vaccine donations: US vs. China

  • The United States outpaces China in its donations of COVID-19 vaccines to Latin America and the Caribbean, with Colombia and Mexico topping the list. The region has received roughly 52 percent of all US COVID-19 vaccine donations. To learn more, visit our COVID-19 vaccine tracker: Latin America and the Caribbean.

Health + Innovation

  • Caribbean: Ten countries have yet to reach the World Health Organization’s (WHO) goal of 40 percent vaccination coverage in 2021.
  • Trinidad and Tobago: The latest country to announce the relaxation of COVID-19 restrictions.
  • Mexico: Government officials reported 1,684 new confirmed cases, the lowest single-day count in 2022 so far, bringing the total number of confirmed cases to 5,566,669.
  • 10,000: The number of COVID-19 vaccine doses Taiwan donated to Saint Lucia and St. Vincent and the Grenadines to help Caribbean allies combat the pandemic.
  • Brazil: Following determinations from its scientific committee, Rio de Janeiro is relaxing the use of masks as the COVID-19 pandemic wanes.

Economies in focus

Economic Impact

  • The International Labor Association established that the pandemic-induced labor market crisis in the region disproportionately impacted women, with 4.2 million of the 23.6 million jobs lost for female workers still to be recovered.
  • While the rise in global commodity prices due to the Russian invasion of Ukraine could benefit exporters across Latin America, it will also likely raise inflation rates.
  • The International Monetary Fund (IMF) warned that the Peru’s economic outlook remains uncertain despite a 13.3 percent GDP growth in 2021.

Economic Recovery

  • Brazil came out of recession with a GDP growth rate of 0.5 percent during Q4, setting GDP growth for 2021 at 4.6 percent.
  • Major Latin American currencies stood up to a weaker dollar as the war in Ukraine pushed oil and commodity prices higher.

Social transformations: Emergence of care policies in Latin America and the Caribbean

  • The pandemic provided a political window to discuss the implementation of state-sponsored care policies, which before the pandemic, had been noticeably absent in the region. Prior to 2020, Uruguay was the only country in the region to possess an institutionalized care system.
  • Over the last two years, Argentina created a federal care system, Bogota instituted a district care system, Costa Rica developed a National Child Care and Development Network, and the Mexican Chamber of Deputies approved a national care system.

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Aviso LatAm: COVID-19 February 25, 2022 https://www.atlanticcouncil.org/content-series/aviso-latam-covid-19/aviso-latam-covid-19-february-25-2022/ Fri, 25 Feb 2022 15:16:54 +0000 https://www.atlanticcouncil.org/?p=491827 PAHO is on track to procure 200 million vaccines for the region

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​​​​​What you should know

  • 100 million: The milestone number of COVID-19 vaccine doses delivered by the Pan-American Health Organization through COVAX to Latin America and the Caribbean (LAC).
  • Cases: COVID-19 infections in the Americas declined by 31 percent last week, an encouraging trend tempered by a 5.6 percent rise in deaths.
  • ICYMI: A new report, featuring key regional insights from Brazil, Central America, Mexico, and Trinidad and Tobago details how US and Chinese vaccine diplomacy in LAC fared during the pandemic.

Vaccination by the numbers

Percentage of population with booster shot: Chile (71) #1 worldwide, Uruguay (55) #17 worldwide, Cuba (51) #20 worldwide, Argentina (36) #41 worldwide, Brazil (29) #52 worldwide, Peru (28) #53 worldwide, Panama (26) #59 worldwide, El Salvador (21) #64 worldwide, Dominican Republic (20) #65 worldwide, Ecuador (20) #66 worldwide, Colombia (15) #68 worldwide. Source: nytimes.com

Percentage of population fully vaccinated: Chile (90) #5 worldwide, Cuba (87) #7 worldwide, Argentina (80) #21 worldwide, Uruguay (78) #26 worldwide, Ecuador (78) #28 worldwide, Costa Rica (74) #36 worldwide, Brazil (73) #42 worldwide, Peru (71) #44 worldwide, Colombia (66) #59 worldwide, El Salvador (66) #60 worldwide. Source: nytimes.com

Vaccinations per capita (vaccines administered per 100 people): Cuba (307) #1 worldwide, Chile (252) #2 worldwide, Uruguay (219) #14 worldwide, Argentina (205) #27 worldwide, Brazil (183) #39 worldwide, Ecuador (179) #41 worldwide, Peru (177) #43 worldwide, Costa Rica (170) #50 worldwide, Panama (161) #58 worldwide, El Salvador (157) #62 worldwide, Colombia (151) #64 worldwide. Source: nytimes.com

Geopolitics of vaccine donations: US vs. China

  • The United States outpaces China in its donations of COVID-19 vaccines to Latin America and the Caribbean, with Colombia and Mexico topping the list. The region has received roughly 52 percent of all US COVID-19 vaccine donations. To learn more, visit our COVID-19 vaccine tracker: Latin America and the Caribbean.

Health + Innovation

  • Paraguay: The second country in the world to grant emergency use authorization to the Taiwanese-manufactured Medigen vaccine.
  • Moderna: In a bid to expand vaccine reach in LAC, the lab announced a distribution deal with Adium, an Uruguayan pharmaceutical company.
  • 1.5 million: The number of students returning to their classrooms in Paraguay, many of them for the first time since the onset of the pandemic.
  • 14: The number of PAHO member countries that have vaccinated 70 percent or more of their population against COVID-19.
  • Brazil: Life expectancy decreased 4.4 years due to the effects of the second surge of COVID-19, which peaked in April 2021.
  • Panama: 73 percent of public schools will welcome nearly 1 million students to the classroom following two years of remote learning.
  • AstraZeneca: Brazil’s Health Ministry delivered the first batch of COVID-19 vaccines made in-country following a 2021 technology transfer deal with the British-Swedish company.

Economies in focus

Economic Impact

  • Brazil’s consumer prices continue to increase despite aggressive contractionary policies. Further adjustments to control inflation are expected.
  • Mexican annual inflation likely rose in the first half of February after declining during the previous eight weeks, supporting predictions that the country’s central bank will keep increasing rates in line with the US Federal Reserve.

Economic Recovery

  • Colombia’s GDP expanded 10.6 percent in 2021, according to Colombia’s national statistics agency, the highest level of national GDP growth in the last 115 years.
  • Peru’s economy grew 13.3 percent in 2021. However, monthly data points to a deceleration in growth, with a modest 3.4 percent growth in 2022. 
  • The Organisation for Economic Cooperation and Development (OECD) expects Mexico to rebound to pre-pandemic growth levels by Q3 of 2022.

Social transformations: Startup companies in Latin America and the Caribbean are fueling the region’s hiring boom

  • Latin America’s unicorns are driving a regional hiring boom as unprecedented investment allows local companies to expand recruiting efforts and hunt for talent outside of their own borders. 
  • Hiring for positions such as software engineer and account executive in Latin America increased by 286 percent in the second half of 2021, more than in any other region in the world.
  • The number of international companies hiring in Latin America grew by 156 percent in the second half of 2021, more than anywhere else worldwide due to the opportunities created by the transition to remote work. 

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US-China vaccine diplomacy: Lessons from Latin America and the Caribbean https://www.atlanticcouncil.org/in-depth-research-reports/report/us-china-vaccine-diplomacy-lessons-from-latin-america-and-the-caribbean/ Wed, 23 Feb 2022 14:00:00 +0000 https://www.atlanticcouncil.org/?p=489227 The implications of diverging COVID-19 responses, notably at the onset of the pandemic’s rise in the region, will reverberate beyond the health sector. What might the differing US and China pandemic approaches portend for future influence in the region? 

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Introduction 

COVID-19 has laid bare the competing strategies and practices of the United States and China to amass further clout in Latin America and the Caribbean (LAC). In many ways, the pandemic is quickly accelerating a regional trend seen over the last decade: China uses its growing economic and diplomatic muscle to provide an alternative to US activities and interests. The implications of diverging COVID-19 responses, notably at the onset of the pandemic’s rise in the region, will reverberate beyond the health sector. What might the differing US and China pandemic approaches portend for future influence in the region? 

For the United States and China, the pandemic has opened new opportunities to deepen regional ties. Both countries’ assistance eventually centered on vaccine diplomacy, but China was first out of the gates in offering vaccinations beyond its borders. 

For LAC, its interactions with the United States and China during the pandemic are emblematic of broader trends: China provides an alternative to LAC during crisis moments; and regional leaders use US-Chinese competition to their advantage. Both instances are visible in the region, including in the four geographic areas analyzed in the following pages: Central America, Trinidad and Tobago (T&T), Brazil, and Mexico. In each case, distinct US and Chinese engagement at various stages of the pandemic—along with the host countries’ own actions and reactions—have yielded short-term results and some that are likely to persist. 

In Central America, China provided strategic diplomatic messaging alongside vaccine shipments, but the United States donated more vaccines. In T&T, Chinese vaccines were accompanied by a new loan, and the country’s prime minister applied a pragmatic approach to acquire vaccines from both the United States and China. For Brazil, laboratory-to-laboratory agreements highlighted a different version of vaccine diplomacy: one that occurs at the subnational level. In Mexico, numerous diplomatic exchanges occurred alongside substantial vaccine purchases from US and Chinese manufacturers. 

Vaccine-related diplomacy also contributes to an evolving discussion about the different ways China and the United States more broadly engage the region—and vice versa. Starting from a low base, Chinese engagement with LAC has focused on and grown significantly in diplomacy, trade, and investment over the last decade. China is either the first- or second-largest trading partner for many countries in the Americas and a top source of foreign direct investment among its allies. Current US strategy in the region similarly reflects a new sense of deploying diplomatic tools to advance hemispheric prosperity, while doing so as part of a broader vision that reflects partnering to address global challenges—from climate change and the instability that sparks migration to shoring up democracy and addressing corruption. Overall, the region’s proximity, shared peoples, history, and borders with the United States provide greater depth and multidimensionality to the relationship. Consequently, vaccine diplomacy represents a greater marginal opportunity for China to broaden and deepen regional ties.

Central America (Belize to Panama) 

By María Eugenia Brizuela de Ávila

Central America has a deeper and more extensive relationship with the United States than China. Bilaterally and through COVAX (the international cooperative program), the United States donated and supplied more vaccines to Central America than China.1 Migratory flows through the region to the US-Mexico border and strong economic linkages make Central America a strategic location for US interests. Remittances, the Dominican Republic-Central America Free Trade Agreement (DR-CAFTA), in which the United States enjoyed a goods trade surplus of $7 billion,2 migratory flows, and shared tourism demonstrate these multifaceted US-Central American ties. In addition, the effectiveness of US-origin vaccines is positively rooted in people’s minds.  

US-China competitive dynamics in Central America have been on full display since the pandemic. The US government announced $310 million in humanitarian assistance to El Salvador, Guatemala, and Honduras in April 2021.3 China has donated its own vaccines to diplomatic allies in Central America and sold at least 1.5 million Sinovac doses to El Salvador.4 China also cut attractive deals to deliver its vaccines at cheaper prices than US vaccines. Moreover, Beijing announced that it would provide $1 billion in financing to LAC countries to help them purchase Chinese vaccines, as discussed in the Trinidad and Tobago case study. Overall, US donations, including through COVAX, to Central America have totaled an estimated 16.8 million doses compared to China’s total donations to Central America of 1.75 million doses.5

Vaccine shipments opened a new avenue for China to strengthen diplomatic ties. Chinese officials conflate the number of vaccine doses they donate and sell to other countries. Combining donations with purchased shipments allows China to capitalize on the optics of vaccine deliveries. Take El Salvador as an example. Although China only donated 750,000 vaccine doses to date, subsequent arrivals of El Salvadoran-purchased Chinese doses (totaling 5 million) were greeted with uncommon fanfare. On one occasion, purchased Chinese vaccines were delivered to El Salvador by a leased plane owned by the New England Patriots, a National Football League team.6 The plane use drew significant international media attention, accentuating the perception that China was leading vaccine supply in LAC. More broadly, while US deliveries also received media attention, Chinese vaccine shipments (both purchased and donated) made a stronger public impression than most US donations delivered via COVAX.7 

To bridge this perception gap, US vaccine donations to Central America need to be more geo-strategically competitive. Bilaterally, the United States can expand its commitment to regional recovery by helping overcome in-country logistical challenges associated with vaccine administration. Many mRNA vaccines donated by the United States, such as the Pfizer vaccine, require ultracold-storage freezers to house them. Donations that come with the requisite equipment or training could build appropriate capacity for national and local governments to increase vaccination rates and reduce wastage. Additional support could include providing supplementary supplies like needles and alcohol pads and securing customs arrangements.

As the pandemic continues and more COVID-19 assistance is needed, vaccine diplomacy has laid the groundwork for China to broaden engagement with Central America. In December 2021, this played out with Nicaragua switching its diplomatic relations from Taiwan to China, and resulted in a donation of 200,000 vaccines less than a week later.8 Taiwan’s three remaining Central American allies (Honduras, Belize, and Guatemala) surely took notice. The swiftness and growing scale of Chinese support in moments of crisis—pandemics, climate events, or economic hardship—is likely to put additional pressure on Taiwan and its allies. When faced with resource constraints, these Central American countries, under stress, might see a pivot to China as advantageous to secure needed assistance for their citizens.9

The US response to the region during the pandemic complemented its approach in combatting the root causes of migration flows by improving security conditions and boosting economic prosperity. To advance US interests during future global events, it must be among the first to deliver aid, rethink how it communicates shipments, and identify additional political or economic accompaniments to enhance bilateral relations with Central American countries. 

Trinidad and Tobago 

By Riyad Insanally

In March and April 2021, Dr. Keith Rowley, as both chair of the Caribbean Community (CARICOM) and T&T’s prime minister, wrote to US President Joe Biden, spoke with US Congresswoman Maxine Waters, chair of the House Committee on Financial Services, and engaged with senior White House officials about vaccine access for the Caribbean.10 He also spoke with Chinese President Xi Jinping and China’s ambassador to T&T in March 2021.11 US discussions eventually resulted in a letter from President Biden acknowledging the Caribbean’s need for vaccines while engagement with China was met with action – a $204 million loan and a total donation of 300,000 Sinopharm vaccines to T&T in May and June 2021.12

The loan stipulated that at least 15 percent of the money should be used to purchase “goods and services from China,” which included Sinopharm vaccines, allowing T&T to purchase an additional 800,000 doses.13 China’s loan had fewer restrictions than one offered by the International Monetary Fund (IMF), which T&T rejected. The IMF loan had a lower interest rate but required structural readjustments that the T&T government felt it could not afford.  

Distribution of US personal protective equipment (PPE) occurred earlier, but China donated vaccines first. US vaccines arrived on June 14 and August 14. The first donation was a mere 480 doses, which arrived on the same day as 200,000 from China. Unsurprisingly, Chinese and Trinidadian media criticized the US donation.14 China’s diplomatic coup was only partially reversed when a larger US donation of 305,370 vaccines (from a promised 908,000) arrived on August 12, coinciding with a visit by Admiral Craig Faller, then-commander of US Southern Command.15 A second US batch (304,200) arrived on December 9, 2021.16 The US donations to T&T are part of a larger four-million dose promise to CARICOM countries (excluding Haiti), compared to just over a million from China. 

Infographic credit: Nancy Messieh, Atlantic Council 

The United States often seems to take its relationship with the Caribbean for granted when it should be paying closer attention. Indeed, especially with China’s vaccine diplomacy, the United States should be wary of losing goodwill and influence in CARICOM to China’s benefit. The Caribbean is regarded as the US’s third border and, in addition to the region’s geostrategic importance, the US enjoys a trade surplus of $6.5 billion with CARICOM. T&T, a longtime US ally, sits in a strategic area in the Caribbean. It shares a maritime border with Venezuela, a key reason why Rowley maintains relations with the Nicolás Maduro regime, and T&T is a frequent destination for Venezuelan refugees.17 As a larger Caribbean economy, T&T is a valuable trade partner, especially for US goods and services from Florida. 

Yet limited or slow engagement during the pandemic has decreased US standing in T&T and the Caribbean. Rowley maintains a policy of autonomy in T&T’s relations with the United States and China, noting that they are “never a case of one or the other . . . as we look after the interest of the people of T&T.” Small states like T&T cannot afford to depend on one power. In an international system marked by asymmetrical relationships, these states maintain a diversity of relations.18

Renewed US commitment to T&T and the Caribbean opens the door for the United States to increase its support to help preserve the region’s health and to build back better after the pandemic. To counter Chinese influence, the United States must compete better and smarter. For instance, had US bilateral vaccine donations started sooner, they would have had a significant impact in Caribbean countries, given their smaller population size relative to Latin American neighbors—and that would have been a quick win for the United States and a meaningful first step toward health security and economic recovery. Consistent and sustained US support, via foreign aid and knowledge sharing, would help Caribbean countries better prepare for this and the next pandemic, as well as other sustainable growth challenges aggravated by pandemic-like shocks. 

Brazil 

By Claudia Trevisan

In Brazil, vaccine dynamics centered on cooperation agreements with US, Chinese, and British manufacturers. Domestic production afforded Brazil greater control over the timing and consistency of vaccine supply—a fluctuating variable elsewhere in LAC. US and Chinese vaccine donations to Brazil are minimal relative to the rest of the region. Save for the US donation of three million doses of Johnson & Johnson’s vaccine announced on June 23—barely 1% of the 407 million doses distributed so far—Brazil’s remaining 404 million doses were acquired commercially.19 While China did not donate vaccines to Brazil, it was the source of the active pharmaceutical ingredient used in several million AstraZeneca and CoronaVac shots.20

The Brazilian experience also illustrates that while geopolitics and domestic politics are ever present, they come second after practicality and medical urgency. 

China played a prominent role early in Brazil’s immunization campaign.21 Through laboratory-to-laboratory collaboration, Sinovac and Butantan—a government-owned laboratory in the powerful state of São Paulo—signed an agreement in September 2020.22 As a result, Sinovac-CoronaVac, an inactivated virus vaccine pioneered in China, was the first vaccine administered in Brazil on January 17 (with AstraZeneca’s vaccine arriving a week later). CoronaVac remained the most commonly applied vaccine in Brazil until July 2021, becoming instrumental in the reduction of deaths from a seven-day average of 3,124 on April 4 to 1,565 on July 1.23 Although President Jair Bolsonaro repeatedly questioned the efficacy of the Chinese vaccine and preferred the AstraZeneca vaccine for the immunization campaign, limited supply at the time forced the inclusion of CoronaVac, purchased through negotiation with China by his political opponent, Joāo Doria (governor of São Paulo).24

In parallel with the CoronaVac arrangement, Brazil successfully applied its “formula” of direct partnership with Chinese manufacturers to other foreign vaccine manufacturers. In mid-2020 the federal government entered its own agreement with AstraZeneca, a British-Swedish company, through a partnership with the state-owned laboratory Fiocruz.25 In August 2021, US-based Pfizer and its German partner BioNTech signed a letter of intent with a Brazilian private laboratory called Eurofarma to produce vaccines in Brazil.26 The Butantan laboratory also is finalizing its own vaccine, ButanVac, developed in part with technology from the American hospital Mount Sinai.27

Infographic credit: Nancy Messieh, Atlantic Council 

Furthermore, these laboratory-to-laboratory partnerships built technological and production capacity in Brazil, resulting in a level of COVID-19 vaccine self-sufficiency unseen in most LAC nations. It could enable Brazil to become a “launching pad” for vaccine exports and possibly donations. Sinovac and Butantan’s agreement is a prime example. The president of the Butantan Institute projects that most of the 100 million Sinovac-CoronaVac doses produced yearly will be exported to Latin America and Africa beginning in 2022. Not unlike the United States and China, Brazil’s ability to produce vaccines itself could eventually allow it to advance foreign policy objectives and build goodwill with other countries in need.

Brazil’s unique case illustrates three important points. First, limited US and Chinese vaccine donations yielded less traditional vaccine diplomacy competition. Second, laboratory agreements uncover a different type of vaccine diplomacy: one that occurs at the subnational level (CoronaVac’s initial use). Finally, vaccine dynamics in Brazil involved more international players than the United States and China, as the AstraZeneca agreement demonstrates. 

Mexico

By Bosco Marti

US and Chinese engagement with Mexico has been visible before and throughout the pandemic, including memorable milestones such as the North American Leaders’ Summit. Early on, Mexico sought help from the United States – its most important and reliable ally – to buy needed PPE equipment and N-95 masks. US support did not immediately materialize due to both countries’ similar peaks in caseload. This created pockets of diplomatic opportunities for other countries including China. Since China had an earlier first wave of COVID-19 infections, it had “off-cycle” pandemic peaks that allowed it to provide vaccines and other supplies when Mexico needed them the most. A Mexico – China air bridge was established via Aeromexico to secure the needed PPE materials.28 US support eventually came, as Mexico was the first Latin American country to benefit from vaccine donations.29 By September 2021, the United States had donated 10.9 million vaccine doses; in contrast, China sold vaccines via purchasing agreements.30 In total and to date, Mexico has received (donated and purchased) more than 250 million vaccine doses across all foreign sources.31

Romero, Henny. Workers stand near a batch of the first shipment of the AstraZeneca coronavirus disease (COVID-19) vaccine delivered under the COVAX scheme. Photograph. Reuters Images. April 22, 2021. Accessed January 10, 2022.

Accompanying those vaccine purchases were diplomatic exchanges and new agreements between Mexico and China. In April 2021, Chinese legislator Li Zhansu held talks on vaccines and other foreign policy issues with Oscar Eduardo Ramirez Aguilar, the speaker of Mexico’s Senate.32 In September 2021, Mexican Foreign Secretary Marcelo Ebrard spoke with his counterpart in China, Foreign Minister Wang Yi, about vaccines and other foreign policy priorities.33 Such high-level executive and legislative exchanges reveal the depth of China-Mexico pandemic diplomacy, which has brought about new accords. For example, Mexico and China signed an important medical cooperation agreement in April 2021.34 The agreement is intended to expedite regulatory requirements for vaccines and medical devices shipped between the two countries. 

For its part, the United States supported Mexico’s fight against the pandemic through vaccine donations and broader health collaboration. For instance, at the North American Leaders’ Summit (which also included Canada), a key deliverable was continued cooperation to increase vaccine donations throughout the hemisphere, strengthen medical supply chains, prepare for the next pandemic, promote equitable economic growth, and coordinate on migration issues. On one hand, the interconnectedness of US-Mexico health and prosperity represents a unique edge for the United States over China. On the other, Mexico-China relations arguably benefited from a more singular focus on vaccine arrivals and Mexican media coverage of it.35  

Overall, Mexico skillfully navigated US-China dynamics during the pandemic to its advantage. Before the March 2021 US vaccine donation, President Andrés Manuel López Obrador had asked the Biden administration for help but it was slow in coming (US vaccines came later that month).36 As he had with the PPE request, he turned to China to purchase a batch of twenty-two million doses. This was an important point in the triangular dynamics of relations among the United States, China, and Mexico—indicative of Mexico’s agency and ability to independently negotiate with other countries should it deem US responses insufficient to Mexican needs. Similar power dynamics were observed in 2017, when then-Mexican President Enrique Peña Nieto visited China amid faltering trade negotiations with Washington. 

Looking ahead, vaccine and health collaboration will continue to provide China and the United States with additional pathways to engage LAC. However, unlike many LAC countries where China has made considerable commercial headway, Mexico is unique in the scale and scope of its economic relationship with United States—by far its largest trade and investment partner—as well as shared history, culture, and other interests.37 Thus, the US remains a reliable partner to Mexico despite the initial delayed start in vaccine provision, due to the depth and breadth of interlocking ties and both countries’ incentives in maintaining them. A pivotal element related to the dynamics among these three nations during and after the pandemic is a game of (distant) catch-up: will the United States be more successful in leveraging vaccine diplomacy to cement Mexico ties, or will China be more successful in using it to diversify and upgrade existing relations with Mexico?

Conclusion

The pandemic itself may be an anomaly, but US-Chinese-LAC dynamics during it are not a unique event. US and Chinese COVID-19 assistance and vaccine diplomacy are part of a broader trend in the triangular relationship. LAC proximity means that the United States will always have an interest in the health of the hemisphere. China’s growing global reach means that it will not ignore an entire region that holds considerable resources. Meanwhile, since LAC governments are disproportionately affected by global circumstances—such as climate change, economic swings, and the economic fallout from the pandemic, in particular—these leaders will always seek support from willing partners. 

While the pandemic exemplifies the opportunities created by global trends for US and Chinese engagement in LAC and their different strategies, it also underscores the role of pragmatism (local needs and perceptions) in driving LAC policies and actions. At the early height of the pandemic, the quantity and timing of vaccine shipments and bilateral diplomatic engagements had two likely implications: helping to shape citizens’ perceptions of US and Chinese support;38 and potentially improving perceptions of US and Chinese support during future global events and disasters. Understanding these implications provides more tools to US and LAC policymakers as they aim to better serve the hemisphere’s needs.  

Ernst, Jonathan. U.S. President Joe Biden speaks virtually with Chinese leader Xi Jinping from the White House in Washington, U.S. November 15, 2021. Photograph. Reuters Images. November 16, 2021. Accessed January 10, 2022.

The case studies provide the following broader insights into these dynamics. 

  • LAC leaders court the United States and China: LAC governments are using US-Chinese dynamics to their advantage. The impact on the health of LAC citizens and on regional economies created an urgency among leaders to secure resources, vaccines, and assistance. LAC leaders initially sought aid from China and other allies because US vaccines had not arrived. Yet even when US vaccines arrived, LAC governments remained engaged with China. Although US material support was limited or slow in some cases, it eventually grew. The United States continued to engage the region by providing pandemic assistance and cooperation on other issues, such as migration, security, and climate change. Thus, the pandemic highlights an important trait in US-Chinese-LAC relations: regional governments do not view China as a replacement for the United States—or vice versa—but as an additional or alternative source of external support. 
  • The number of bilateral vaccine shipments (donations plus purchases) matter: The scale and number of Chinese vaccine shipments to LAC is an important point. The implications are twofold: bilateral vaccine shipments were greeted by regional media headlines and provided more opportunities for Chinese officials to meet with local leaders and government ministers; and the public places greater emphasis on being vaccinated rather than where the vaccine was developed (whether donated or purchased). Many US donations, including several supplied through and co-branded with the multilateral COVAX facility, did not generate similar impact in public perception. In addition, only ten LAC countries are qualified for the COVAX Advance Market Commitment (“AMC”) mechanism, designed to cover the purchase of vaccine doses by qualifying low-income countries. The remaining LAC countries signed self-financing agreements with COVAX. Those that did qualify for COVAX’s AMC mechanism received smaller and delayed quantities relative to larger, quicker Chinese shipments. 
  • Timing and consistency are key: While LAC benefited from assistance by both the United States and China early in the pandemic, Chinese vaccines arrived first. Delivering vaccines before the United States allowed China to build goodwill with regional leaders and caused LAC citizens to question the timing of US donations. Second, timely Chinese shipments highlighted sustained and consistent support to LAC—something the region routinely calls for from the United States. Whereas China’s COVID-19 PPE assistance was followed by vaccine shipments, US bilateral vaccine support came after a monthslong gap. 
  • Diplomacy is the perfect complement: Chinese assistance to LAC was usually accompanied with media headlines and coincided with high-level and subnational diplomacy. In El Salvador and T&T, for example, China used photos with national ministers and speeches at LAC airports during vaccine arrivals to bring national and international media attention to its actions. The United States used a similar model during its vaccine shipments, though in most cases with less fanfare. However, China also engaged more diligently and directly with LAC leaders. Xi called LAC leaders when they were infected with COVID-19 to promise vaccine donations, and to discuss other accompaniments including new loan agreements. Former President Trump rarely engaged with LAC during the pandemic, and Biden’s interactions were limited mostly to multilateral settings, whereas Xi’s interactions were bilateral. 

Acknowledgments 

We would like to thank the Atlantic Council for the opportunity to share regional perspectives and analyses on US and Chinese support during the COVID-19 pandemic. As regional governments look to the international community for support, we hope this report can shed a light on best practices and strategies to engage with LAC countries. 

At the Atlantic Council, we would like to thank Jason Marczak and Pepe Zhang for their leadership and guidance; Susan Cavan and Beverly Larson for editorial assistance; and Donald Partyka and Nancy Messieh  for design support, particularly in the infographic process. Finally, a special thank you to Isabel Bernhard whose editorial guidance, thought leadership, and valuable analysis underpinned many of the unique ideas in this report. Her contribution was critical to the report’s ideation, development, and completion. 

About the authors

María Eugenia Brizuela de Ávila (“Mayu”) is a Non-resident Senior Fellow at the Adrienne Arsht Latin America Center, as well as a former and first female Minister of Foreign Affairs of El Salvador. She also possesses extensive experience in the private sector as a former president of an insurance company, a former president of a private bank, and an independent director on several bank boards in El Salvador and Honduras. Her expertise across diplomacy and development has been recognized by the Aspen Ministers Forum, Vital Voices, and the Adrienne Arsht Latin America Center. She holds a law degree from the Universidad Dr. Jose Matias Delgado in El Salvador and additional academic titles from the University of Cambridge, the Sorbonne, and INCAE. 

Riyad Insanally is a Non-resident Senior Fellow at the Caribbean Initiative of the Adrienne Arsht Latin America Center. He was Guyana’s Ambassador to the United States and Permanent Representative to the Organization of American States from 2016 to 2021. Ambassador Insanally was a career diplomat for over 31 years and received Guyana’s third highest award, the Cacique’s Crown of Honour, in 2019 for his service to diplomacy and international relations. He studied Modern Languages and Latin American Studies and holds MA and MPhil degrees from the University of Cambridge and a PhD from Harvard University.  

Claudia Trevisan is the executive director of the China-Brazil Business Council (CEBC). As a career journalist with over 30 years of experience, she has worked as a correspondent for leading Brazilian newspapers in the United States, China, and Argentina and authored two books on China. Claudia received her master’s degree from the School of Advanced International Studies/Johns Hopkins University in 2019, followed by one year as a non-resident fellow at SAIS’s Foreign Policy Institute. 

Bosco Martí is a Non-resident Senior Fellow with the Atlantic Council’s Adrienne Arsht Latin America Center and is the global director of institutional affairs and communications for Aleatica, a multinational transportation infrastructure operator. Martí served for six years as executive director for Mexico and the Dominican Republic at the board of directors of the Inter-American Development Bank and the Inter-American Investment Corporation. He has also held senior positions in Mexico’s Ministry of Foreign Affairs and the Office of the President. Martí holds a BS in industrial engineering from Universidad Iberoamericana in Mexico City. 

Wazim Mowla is the assistant director for the Caribbean Initiative at the Adrienne Arsht Latin America Center, where he works on the Caribbean and China portfolios. Mowla holds a bachelor’s degree in international relations and a master’s degree in history from Florida International University, where he is currently a nonresident scholar for the Jack D. Gordon Institute for Public Policy. Mowla provides frequent commentary for US and Caribbean media outlets.  

1    “China COVID-19 Vaccine Tracker,” Bridge Beijing, accessed November 1, 2021, https://bridgebeijing.com/our-publications/our-publications-1/china-covid-19-vaccines-tracker/. See also Chase Harrison, “Tracker: U.S. Vaccine Donations to Latin America,” Americas Society/Council of the Americas, last modified October 28, 2021, accessed November 1, 2021, https://www.as-coa.org/articles/tracker-us-vaccine-donations-latin-america.
2    “CAFTA-DR (Dominican Republic-Central America FTA),” Office the United States Trade Representative (website), accessed December 23, 2021, https://ustr.gov/trade-agreements/free-trade-agreements/cafta-dr-dominican-republic-central-america-fta#:~:text=The%20U.S.%20goods%20trade%20surplus,134%20thousand%20jobs%20in%202014.
3    “United States donates 1.5 million COVID-19 vaccines to El Salvador,” US Embassy in El Salvador, last modified July 4, 2021, accessed November 1, 2021, https://sv.usembassy.gov/united-states-donates-1-5-million-covid-19-vaccines-to-el-salvador/. See also “U.S. Government Aid of 3 Million Vaccines Arrives in La Aurora,” US Embassy in Guatemala, last modified July 20, 2021, accessed November 1, 2021, https://gt.usembassy.gov/u-s-government-aid-of-3-million-vaccines-arrives-in-la-aurora/.
4    “China to Send Fifth Batch of COVID-19 Vaccines to El Salvador,” State Council, People’s Republic of China, last modified July 7, 2021, accessed November 1, 2021, http://english.www.gov.cn/news/internationalexchanges/202107/07/content_WS60e50849c6d0df57f98dc833.html.
5    “COVID-19 Vaccine Donations,” US Department of State, accessed January 6, 2022, https://www.state.gov/covid-19-recovery/vaccine-deliveries/#map_western. See also “China COVID-19 Vaccine Tracker,” Bridge Beijing, accessed January 6, 2022, https://bridgebeijing.com/our-publications/our-publications-1/china-covid-19-vaccines-tracker/.
6    Joshua Goodman, “New England Pats Give Flight to China’s Vaccine Diplomacy,” Associated Press, last modified May 21, 2021, accessed November 1, 2021, https://apnews.com/article/new-england-patriots-china-business-diplomacy-sports-430ed8696f101ad6739a90c53752c77a.
7    Ibid.
8    “Nicaragua Receives China Vaccines After Cutting Ties with Taiwan,” BBC News, accessed December 15, 2021, https://www.bbc.com/news/world-asia-59633388
9    Mowla, Wazim, and Isabel Bernhard. “Why Might Taiwan’s Allies in Latin America and the Caribbean Soon Look to China?” Global Americans. Last modified January 6, 2022. Accessed January 11, 2022. https://theglobalamericans.org/2022/01/why-might-taiwans-allies-in-latin-america-and-the-caribbean-soon-look-to-china/
10    “PM in Ongoing Talks with US on Vaccine Redistribution,” Government of the Republic of Trinidad and Tobago (website), accessed November 1, 2021, http://www.news.gov.tt/content/pm-ongoing-talks-us-vaccine-redistribution#.YYCwJZ7MLIU.
11    “Xi Jinping Speaks with Prime Minister Keith Rowley of Trinidad and Tobago on the Phone,” Chinese Ministry of Foreign Affairs (website), last modified March 16, 2021, accessed November 1, 2021, https://www.fmprc.gov.cn/mfa_eng/zxxx_662805/t1861971.shtml.
12    Ryan Hamilton-Davis, “Trinidad and Tobago to Take Chinese loan to Buy Chinese Vaccines,” Newsday, last modified May 11, 2021, accessed November 1, 2021, https://newsday.co.tt/2021/05/11/trinidad-and-tobago-to-take-chinese-loan-to-buy-chinese-vaccines/.
13    Jensen La Vende, “Trinidad and Tobago to Get 800,000 COVID-19 Vaccine Doses from China,” Newsday, last modified July 10, 2021, accessed November 2, 2021, https://newsday.co.tt/2021/07/10/trinidad-and-tobago-to-get-800000-covid19-vaccines-from-china/.
14    “Chinese Media Mocks US donation of 80 Vaccine Vials to Trinidad and Tobago,” Reuters, last modified June 16, 2021, accessed November 2, 2021, https://www.reuters.com/business/healthcare-pharmaceuticals/chinese-media-mocks-us-donation-80-vaccine-vials-trinidad-tobago-2021-06-16/.
15    “SOUTHCOM Commander Strengthens Partnerships During Visits to Trinidad and Tobago, Barbados,” US Southern Command (website), last modified August 13, 2021, accessed November 2, 2021, https://www.southcom.mil/MEDIA/NEWS-ARTICLES/Article/2731131/southcom-commander-strengthens-partnerships-during-visits-to-trinidad-and-tobag/.
16    “T&T to Receive 2nd tranche of COVID-19 vaccines from US Gov’t,” Loop News, accessed December 15, 2021, https://tt.loopnews.com/content/tt-receive-2nd-tranche-covid-19-vaccines-us-govt
17    Georgina Chami and Florence Seemungal, “The Venezuelan Refugee Crisis in Trinidad and Tobago,” University of Oxford Faculty of Law, last modified April 9, 2021, accessed November 2, 2021, https://www.law.ox.ac.uk/research-subject-groups/centre-criminology/centreborder-criminologies/blog/2021/04/venezuelan.
18    Mowla, Wazim, and Pepe Zhang. “Latin America and the Caribbean’s asymmetrical engagement with China during the COVID-19 pandemic.” Georgetown Security Studies Review. 
19    “The United States Donates 3 Million Doses of Johnson & Johnson Vaccine to Brazil,” US Embassy and Consulates in Brazil (website), last modified June 25, 2021, accessed November 2, 2021, https://br.usembassy.gov/the-united-states-donates-3-million-doses-of-johnson-johnson-vaccine-to-brazil/
20    Sergio Queiroz, “Brazil Gets First Active Ingredients for AstraZeneca Vaccine from China,” Reuters, last modified February 6, 2021, accessed November 2, 2021, https://www.reuters.com/article/us-health-coronavirus-brazil/brazil-gets-first-active-ingredients-for-astrazeneca-vaccine-from-china-idUSKBN2A60S7.
21    Andrew Rosati, “Brazil Approves Import of China’s Sinovac Vaccine,” Bloomberg, last modified October 23, 2020, accessed November 2, 2021, https://www.bloomberg.com/news/articles/2020-10-23/brazil-approves-import-of-china-s-sinovac-vaccine.
22    “Brazil’s Sao Paulo Signs Agreement with Sinovac for COVID Vaccine Doses,” Reuters, last modified September 30, 2020, accessed November 2, 2021, https://www.reuters.com/article/us-health-coronavirus-brazil-sao-paulo/brazils-sao-paulo-signs-agreement-with-sinovac-for-covid-vaccine-doses-idUSKBN26L3EO.
23    “COVID-19 Tracker,” Reuters, accessed November 2, 2021, https://graphics.reuters.com/world-coronavirus-tracker-and-maps/countries-and-territories/brazil/.
24    Tom Phillips, “Bolsonaro Rival Hails COVID Vaccinations as ‘Triumph of Science against Denialists,’ ” Guardian, last modified January 18, 2021, accessed November 2, 2021, https://www.theguardian.com/world/2021/jan/18/bolsonaro-rival-hails-covid-vaccinations-as-triumph-of-science-against-denialists; and Célia Froufe, “Após colocar em dúvida eficácia da CoronaVac, Bolsonaro elogia ‘parceria’ com a China,” Estadão, last modified September 9, 2021, accessed November 2, 2021, https://politica.estadao.com.br/noticias/geral,apos-colocar-em-duvida-eficacia-da-coronavac-bolsonaro-elogia-parceria-com-a-china,70003835476.
25    “COVID-19: Fiocruz Will Sign an Agreement to Produce Vaccines by the University of Oxford,” Oswaldo Cruz Foundation, last modified June 30, 2020, accessed November 2, 2021, https://portal.fiocruz.br/en/news/covid-19-fiocruz-will-sign-agreement-produce-vaccines-university-oxford.
26    “Pfizer and BioNTech Announce Collaboration with Brazil’s Eurofarma to Manufacture COVID-19 Vaccine Doses for Latin America,” Pfizer, last modified August 26, 2021, accessed November 2, 2021, https://www.pfizer.com/news/press-release/press-release-detail/pfizer-and-biontech-announce-collaboration-brazils.
27    Ana Bottallo, “Mount Sinai Hospital, in NY, Says It Developed the Vaccine Announced as 100% Brazilian by Butantan,” Folha de São Paulo, last modified March 26, 2021, accessed November 2, 2021, https://www1.folha.uol.com.br/internacional/en/scienceandhealth/2021/03/mount-sinai-hospital-in-ny-says-it-developed-the-vaccine-announced-as-100-brazilian-by-butantan.shtml.
28    “Feature: Massive Air Bridge Unites China, Mexico in Battling COVID-19,” Xinhua News, last modified May 14, 2020, accessed November 7, 2021, http://www.xinhuanet.com/english/2020-05/14/c_139054655.htm.
29    Tamara Keith, “Biden Takes First Jab at Vaccine Diplomacy, Sharing Doses with Mexico, Canada,” National Public Radio, last modified March 19, 2021, accessed November 7, 2021, https://www.npr.org/2021/03/19/979279426/biden-takes-first-jab-at-vaccine-diplomacy-sharing-doses-with-mexico-canada.
30    “Mexico Leans on China After Biden Rules Out Vaccines Sharing in Short Term,” Reuters, last modified March 9, 2021, accessed November 7, 2021, https://www.reuters.com/article/us-health-coronavirus-mexico-vaccines/mexico-leans-on-china-after-biden-rules-out-vaccines-sharing-in-short-term-idUSKBN2B11OY.
31    “First Shipment of Moderna Vaccines Donated by the US Arrives,” Gobierno de México (Federal Government of Mexico’s website), accessed November 7, 2021, https://www.gob.mx/sre/prensa/first-shipment-of-moderna-vaccines-donated-by-the-us-arrives. See also Chase Harrison, Luisa Horwitz, and Carin Zissis, “Timeline: Tracking Latin America’s Road to Vaccination,” Americas Society/Council of the Americas, last modified November 1, 2021, accessed November 7, 2021, https://www.as-coa.org/articles/timeline-tracking-latin-americas-road-vaccination.
32    “China, Mexico Pledge Enhanced Cooperation to Promote Ties,” Xinhua News, last modified April 20, 2021, accessed November 7, 2021, http://www.xinhuanet.com/english/2021-04/20/c_139893420.htm.
33    “Wang Yi Speaks with Mexican Foreign Minister Marcelo Ebrard on the Phone,” Chinese Ministry of Foreign Affairs, last modified September 29, 2021, accessed November 7, 2021, https://www.fmprc.gov.cn/mfa_eng/zxxx_662805/t1911171.shtml.
34    “Mexico and China Sign Regulatory Cooperation Agreement for Medical Supplies,” Gobierno de México, last modified April 21, 2021, accessed November 7, 2021, https://www.gob.mx/sre/prensa/mexico-and-china-sign-regulatory-cooperation-agreement-for-medical-supplies?idiom=en.
35    “¿Cuáles son las vacunas chinas contra el COVID-19 que usa México?,” El Universal, last modified March 24, 2021, accessed November 7, 2021, https://www.eluniversal.com.mx/ciencia-y-salud/cuales-son-las-vacunas-chinas-contra-el-covid-19-que-usa-mexico.
36    “Mexico Leans,” Reuters. 
37    “Mexico,” Office of the United States Trade Representative (website), accessed November 7, 2021, https://ustr.gov/countries-regions/americas/mexico.
38    Evan Cooper and Mathew Burrows, “Reality Check #6: The Consequences of an ‘America First’ Vaccine Policy,” Atlantic Council, May 12, 2021, accessed December 23, 2021, https://www.atlanticcouncil.org/content-series/reality-check/reality-check-6-the-consequences-of-an-america-first-vaccine-policy/

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Aviso LatAm: COVID-19 February 12, 2022 https://www.atlanticcouncil.org/content-series/aviso-latam-covid-19/aviso-latam-covid-19-february-12-2022/ Sat, 12 Feb 2022 14:22:37 +0000 https://www.atlanticcouncil.org/?p=485981 PAHO is on track to procure 200 million vaccines for the region

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​​​​​What you should know

  • Vaccination: Despite regional vaccination rates reaching almost two thirds of the population, fourteen countries have yet to reach the 40 percent coverage threshold.
  • 200 million: The number of vaccines the Pan American Health Organization (PAHO) is on track to procure for the region, urging governments to prepare efficient and well-targeted immunization campaigns.
  • #ProactiveLAC: While digital transformation holds tremendous promise for the region, unlocking its benefits will require a coordinated public-private effort. Tune in to our virtual event on Thursday, February 17 at 9:00 a.m. ET, featuring Inter-American Development Bank President Mauricio Claver-Carone, Mastercard’s Executive Vice President of Market Development of Latin America and the Caribbean Kiki del Valle, and Oracle Latin America’s Executive Vice President Luiz Meisler.

Vaccination by the numbers

Percentage of population with booster shot: Chile (68) #1 worldwide, Uruguay (54) #15 worldwide, Cuba (50) #21 worldwide, Argentina (31) #40 worldwide, Peru (25) #50 worldwide, Brazil (25) #51 worldwide, Panama (24) #57 worldwide, Dominican Republic (19) #59 worldwide, El Salvador (19) #60 worldwide, Ecuador (17) #61 worldwide, Paraguay (13) #66 worldwide. Source: nytimes.com

Percentage of population fully vaccinated: Chile (90) #5 worldwide, Cuba (87) #7 worldwide, Argentina (78) #21 worldwide, Uruguay (78) #22 worldwide, Ecuador (77) #27 worldwide, Costa Rica (74) #37 worldwide, Brazil (72) #42 worldwide, Peru (71) #44 worldwide, El Salvador (65) #58 worldwide, Colombia (64) #61 worldwide. Source: nytimes.com

Vaccinations per capita (vaccines administered per 100 people): Cuba (305) #1 worldwide, Chile (248) #2 worldwide, Uruguay (217) #11 worldwide, Argentina (199) #29 worldwide, Brazil (176) #40 worldwide, Ecuador (175) #41 worldwide, Peru (173) #43 worldwide, Costa Rica (167) #49 worldwide, Panama (157) #60 worldwide, El Salvador (155) #61 worldwide, Colombia (146) #65 worldwide. Source: nytimes.com

Geopolitics of vaccine donations: US vs. China

  • The United States outpaces China in its donations of COVID-19 vaccines to Latin America and the Caribbean, with Colombia and Mexico topping the list. The region has received roughly 52 percent of all US COVID-19 vaccine donations. To learn more, visit our COVID-19 vaccine tracker: Latin America and the Caribbean.

Health + Innovation

  • Spikevax: Colombia agreed to procure an additional 10.8 million doses of Moderna’s COVID-19 vaccine, with one million doses arriving in Q1 of 2022.
  • “TOGETHER Trial”: An international collaboration led by researchers in Brazil and Canada is applying innovative testing methods to determine existing medications’ effectiveness at treating COVID-19.
  • Uruguay: The Public Health Ministry is campaigning to boost COVID-19 vaccination in 150 interior localities from 11 departments.
  • María Elena Bottazzi: This Honduran microbiologist and Nobel Peace Prize nominee successfully created the Corbevax vaccine for COVID-19, a patent-free drug designed for the poorest global communities.
  • 149 percent: The increase in the number of COVID-19-related deaths between December 2021 and January 2022 in Brazil, according to the Health Ministry’s latest epidemiological report.
  • Honduras: President Xiomara Castro is the latest regional leader to contract COVID-19 amid the spread of the omicron variant.
  • Bolivia: Roughly half the population hasn’t received a single dose of the COVID-19 vaccine, due to generalized distrust, misinformation, and other religious motives.
  • Flora Growth: A cannabis-based drug aimed at COVID-19 prevention that seeks emergency use authorization in Colombia.

Economies in focus

Economic Impact

  • The International Monetary Fund (IMF) slashed its 2022 Latin America economic growth forecast, giving the region a 2.4 percent economic growth estimate — significantly lower than the 6.8 percent regional expansion in 2021. 
  • According to the International Labour Organization (ILO), between 60 and 80 percent of jobs recovered by the third quarter of 2021 were part of the informal sector.  
  • Inflation in Colombia reached a five-year high in January 2022 according to the national statistics agency—the highest level since 2016.  

Economic Recovery

  • Brazil’s central bank raised its interest rate by 150 basis points to counter rising inflation–the eighth consecutive hike since it began monetary cycle tightening.
  • The ILO estimated that Latin America’s unemployment rate will reach 9.6 percent – higher than pre-pandemic levels but lower than the 10.6 percent reported in 2020.  

Social transformations: Latin American countries embrace online learning

  • According to the Coursera 2021 Impact Report, Mexico, Brazil, and Colombia were among the top ten countries globally with the most registered students on the online learning platform.
  • With a 39 percent growth figure, Latin America surpassed both North America and Europe in new user registration for Coursera. Paraguay led this trend globally, with 98 percent new user growth.
  • UBITS, a Colombian startup that provides an online learning platform for corporate training, partnered with Mercado Libre and Coursera to provide virtual upskilling opportunities to employees in the region.  

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Warrick quoted in USA Today on trucker protests against vaccine mandates in Canada https://www.atlanticcouncil.org/insight-impact/in-the-news/warrick-quoted-in-usa-today-on-trucker-protests-against-vaccine-mandates-in-canada/ Fri, 11 Feb 2022 16:45:00 +0000 https://www.atlanticcouncil.org/?p=486164 The post Warrick quoted in USA Today on trucker protests against vaccine mandates in Canada appeared first on Atlantic Council.

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Engagement Reframed #1: Vaccinate the world https://www.atlanticcouncil.org/content-series/engagement-reframed/vaccinate-the-world/ Tue, 01 Feb 2022 13:27:06 +0000 https://www.atlanticcouncil.org/?p=463443 The United States can do more to increase vaccination rates around the world, and in doing so help to build a more resilient global health system in which it is a leader.

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What is the opportunity?

The COVID-19 pandemic continues to rage around the globe, taking millions of lives. A better US-organized campaign to vaccinate the world’s population could drastically lower the risk of even more dangerous variants than Delta and Omicron threatening global health. With its mRNA vaccines proving to be more effective than others, the United States is well positioned to lead an international vaccination effort. Doing so, however, will require an increased commitment. A quick distribution of vaccines throughout the world would not only save millions of lives, including those of Americans, but it would also spur a global economic recovery and create diplomatic windfalls for Washington. 

Vaccines produced in the United States have proven their effectiveness in combating the pandemic. The efficacy of the Pfizer-BioNTech and Moderna vaccines at preventing serious illness, including from the Omicron variant, makes them one of the greatest medical innovations in world history. Nevertheless, all immunity wanes; thus time is of the essence. Getting as many people as possible vaccinated in the next few months will reduce the circulation of the virus as well as the potential for more mutations to occur. 

Each mutation poses the threat of creating a deadlier and more transmissible version of the virus, which could prolong and exacerbate the pandemic. Mutations could also render current vaccines less effective—as has occurred with the Omicron variant—and repeatedly set back vaccination drives. Rapidly vaccinating as wide a swath of a population as possible is crucial for preventing new, harmful variants.

A concerted US effort could be the tipping point for getting the pandemic under control, which would position Washington to play a leading role in global health reform.

In addition to being a moral imperative, reducing vaccine inequality would also give the global economy a much-needed boost. An analysis by the United Nations Development Program found that economic recovery is expected to occur more quickly in countries with high vaccination rates: global GDP is expected to increase by approximately $7.93 billion for every one million people vaccinated. As International Monetary Fund (IMF) Managing Director Kristalina Georgieva said last year, vaccine policy is economic policy. The cost of manufacturing and distributing vaccines—estimated by Organisation for Economic Co-operation and Development Chief Economist Laurence Boone at $50-$70 billion—pales in comparison to the potential economic upside. The cost of not doing so is even more stark. According to the Congressional Budget Office, premature deaths and lost productivity caused by the pandemic will cost the United States alone $7.63 trillion over the next decade. Another analysis projected that the United States will lose $16 trillion from the effects of COVID, with Microsoft developer David Cutler and economist Lawrence Summers calling the pandemic, “the greatest threat to prosperity and well-being the United States has encountered since the Great Depression.”

Studies already support a strong correlation between increased economic activity and higher vaccination rates. A group of IMF economists examined how the administration of vaccines correlated with rates of daily nitrogen dioxide (NO2) emissions—an indicator that is strongly linked to industrial production and that can be used to measure overall economic activity. They found a significant correlation between increased NO2 emissions and higher vaccination rates. For every shot the United States can administer around the world, the global economic outlook—including the outlook for the US economy—improves.

Meanwhile, if the United States seizes the moment and takes a leading role in vaccinating the world’s population, Washington could experience a diplomatic boon. China, Russia, and India have all recognized the goodwill and other benefits associated with donating vaccines to other countries. A concerted US effort, appropriately branded and publicized, could be the tipping point for getting the pandemic under control. In addition to the lives saved and the economic benefits, such an effort would position Washington to play a leading role in global health reform, helping to forge a system that could more quickly and effectively respond to future pandemics. Eric Lander, President Joe Biden’s science advisor and director of the White House Office of Science and Technology Policy, has called for better early warning systems, operational vaccines within 100 days of detection, and more home diagnostic kits in order to avoid another tragedy like the current pandemic. 

Why now?

Now is the opportune time for the United States to take the lead because health experts have increasing doubts about the effectiveness of China’s Sinopharm and Sinovac vaccines against the variants. China is scrambling to develop its own mRNA vaccine owing to widespread lack of trust, even among its own public, in its existing vaccines. Pre-clinical trial tests with two Chinese mRNA vaccines under development—Walvax and Abogen—show a robust antibody response against coronavirus during the animal-testing phase. Analysts disagree about how fast Chinese pharmaceuticals could produce at scale the mRNA vaccines should their human trials prove successful. 

Although COVID-19 Vaccines Global Access (COVAX)—a worldwide initiative aimed at creating equitable access to COVID-19 vaccines—recently distributed its billionth dose, it missed its overall 2021 target of 2 billion doses because of a lack of donated supplies from rich countries. The World Health Organization (WHO) is calling on companies and governments to help reach a vaccination target of 70 percent of each country’s population by the end of 2022. Africa remains the continent lacking the most coverage, with less than 10 percent of its population having been vaccinated. Africa accounts for almost two-thirds of the global total of new HIV infections, which makes the continent particularly vulnerable to the spread of the virus and forces it to combat two public health emergencies at once.       

India’s Serum Institute, which produces most of the vaccines for COVAX, had to stop its exports last April in order to supply the domestic market, which was struck by a large second wave. It resumed exports in October but has had difficulty getting vaccines to countries in need due to a lack of cold storage facilities in many of those receiving countries. In October, more than 160 former world leaders and global figures called on the United Kingdom (UK) and other rich countries to immediately airlift millions of surplus COVID vaccines to less-developed nations. Even if that happens, many poor countries lack the logistics and cold-storage facilities necessary to provide vaccinations to millions of people a day. Recently, the new Novavax vaccine has been shown to be effective against Omicron (with three shots); Novavax could also help alleviate the logistics problem because it can be stored in a conventional refrigerator. COVAX has ordered 1.1 billion doses to be manufactured by the Serum Institute while the UK, the United States, and European countries other than the UK have booked orders for 60 million, 110 million, and up to 200 million doses, respectively.

For some time, the WHO has complained about rich countries ignoring the plight of poor countries that cannot afford the cost of Western vaccines and must instead rely on COVAX or donations from other sources to meet their needs. Owing to the recent decisions by Western countries to order additional booster doses for their whole populations, including in some cases even young children, experts estimate that there will be a three billion–dose shortfall globally in the first quarter of 2022, further delaying the timetable for vaccinating poor members of the global population. As of mid-December, the number of boosters dispensed in the world’s richest countries had grown by 5.5 million each day, and COVID boosters in rich countries outnumbered all the vaccine shots given in poor countries. In the United States, booster shots have been authorized for children twelve years old and up. 

The Biden administration announced last November a plan to invest billions in US companies making mRNA vaccines to be given to poor countries. Early reports indicated Moderna and Pfizer were studying the plan, while critics questioned how fast production could ramp up to produce the extra doses. The administration’s goal is to produce one billion extra doses in 2022, but in the last few weeks, administration officials have reportedly been worried that the growing demand for boosters will squeeze out the capacity for producing extra doses for poor countries. Critics charge that the United States should be able to provide enough doses to meet its own needs and those of other nations, particularly because it is in Washington’s interest to have the bulk of the world’s population vaccinated. Nongovernmental organization advocacy groups have called on the Biden administration to pursue a government-owned, contractor-operated manufacturing model if companies such as Pfizer and Moderna are able to boost their production for developing countries. 

How to make it happen

The United States can immediately take several steps to increase global vaccination rates. An article featured in Harvard Business Review in mid-2021 offered a number of ways to increase global vaccine supply, many of which remain relevant today and are discussed below, along with additional ideas for diversifying supplies and encouraging wider distribution:

1. Improve the flow of raw materials essential for production of vaccines. Late last April, the United States announced that it would ease restrictions on the export of raw materials needed for India’s Serum Institute to produce the Covishield vaccine based on AstraZeneca’s design. A typical vaccine-manufacturing plant uses around 9,000 different materials sourced from some 300 suppliers across approximately thirty different countries, according to an International Federation of Pharmaceutical Manufacturers and Associations (IFPMA) estimate. The absence of just one of these elements can have a crippling impact on production. Indian vaccine makers struggled to access materials before the US export ban was eased even as Pfizer and Moderna, two American pharmaceutical companies, benefited from a key raw material from India for their mRNA COVID-19 vaccines. Recently, vaccine manufacturers have warned that limits on raw materials are constraining their ability to produce new doses. Those constraints would deepen if the manufacturers had to produce a new vaccine to counter a more potent variant. The United States and its allies should push for an international agreement that requires all countries to remove trade barriers that disrupt the global flow of both materials for making vaccines and ancillary supplies. 

2. Expand vaccine-manufacturing capacity. As noted, boosting production is especially important for developing countries which, outside of India, lack the ability to produce vaccines. To be sustainable, such facilities need to achieve “cost economics,” which would involve producing not just COVID vaccines but others for combating current and future diseases. Harmonizing regulatory processes could speed up the production and distribution of vaccines during emergencies. The WHO emergency-use-listing procedure provides a global mechanism to streamline regulatory pathways, but many countries require local clinical trials as well as additional steps before authorizing a vaccine.  

3. Encourage allies and partners to grant the TRIPS waiver. Although many experts believe increasing manufacturing outside existing centers in the United States, Europe, and India should be the priority, it is important for Washington to encourage its allies and partners to support the Agreement on Trade-Related Aspects of Intellectual Property Rights or TRIPS Agreement waiver proposal at the World Trade Organization (WTO). Doing so would temporarily waive intellectual property rights protections for technologies needed to prevent, contain, or treat COVID-19—including vaccines and vaccine-related technologies. The waiver would allow WTO member states to issue licenses to firms other than those that hold a particular patent to produce and market a patented product without the prior approval of the patent-rights holder; this allowance would encourage pharmaceutical firms in the developing world to produce COVID vaccines. More than one hundred low-income countries support the waiver, but most rich countries, including Australia, Canada, EU members, Japan, and the UK are opposed. The United States announced its support last May but has not gone much further than rhetoric.

The success of the mRNA vaccines gives the United States an opportunity to rebuild its soft power. President Biden has talked about the United States becoming the vaccine producer for the world, saying at an international conference on COVID, “I made—and I’m keeping—the promise that America will become the arsenal of vaccines as we were the arsenal of democracy during World War II.” Biden and his administration should work with the international community, not just allies and partners, to make sure that the WHO meets its goal of getting 70 percent of every country’s population vaccinated by the end of 2022. Achieving such a goal faces stiff challenges, and there will always be domestic demands, but a combined effort in which the United States takes a lead is possible. After all, at the height of the Cold War, the two opposing antagonists, the United States and the Soviet Union, cooperated to end polio—the scourge of children in both countries and around the world at that time. What was possible then should certainly be doable today.

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Aviso LatAm: COVID-19 January 29, 2022 https://www.atlanticcouncil.org/content-series/aviso-latam-covid-19/aviso-latam-covid-19-january-29-2022/ Sat, 29 Jan 2022 14:21:10 +0000 https://www.atlanticcouncil.org/?p=481220 About two-thirds of Latin America and the Caribbean's population has been fully vaccinated against COVID-19

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​​​​​What you should know

  • Around two-thirds: The share of Latin America and the Caribbean’s (LAC) inhabitants who are fully vaccinated against COVID-19.
  • Davos Agenda 2022: Increasing COVID-19 vaccination rates, swift economic recovery, and integrating climate action in public policies were among the key priorities outlined for the region at the World Economic Forum’s (WEF) annual meeting.
  • #ProactiveLAC: Unlocking the potential of small and medium-sized enterprises is critical to the region’s economic reactivation and long-term prosperity. Tune in to our virtual event on Wednesday, February 2 at 2:00 p.m. ET, featuring Vice President of Dominican Republic Raquel Peña, Coca-Cola Latin America President Henrique Braun, Development Bank for Latin America’s Vice President of Sustainable Development Julián Suárez, and more.

Vaccination by the numbers

Percentage of population with booster shot: Chile (65) #1 worldwide, Uruguay (51) #12 worldwide, Cuba (43) #23 worldwide, Argentina (25) #43 worldwide, Peru (21) #49 worldwide, Brazil (20) #50 worldwide, Panama (20) #52 worldwide, El Salvador (19) #55 worldwide, Dominican Republic (16) #57 worldwide, Ecuador (13) #61 worldwide, Paraguay (11) #62 worldwide. Source: nytimes.com

Percentage of population fully vaccinated: Chile (89) #4 worldwide, Cuba (86) #7 worldwide, Uruguay (78) #21 worldwide, Argentina (76) #24 worldwide, Ecuador (76) #26 worldwide, Costa Rica (72) #39 worldwide, Brazil (71) #43 worldwide, Peru (69) #45 worldwide, El Salvador (65) #56 worldwide, Colombia (61) #70 worldwide. Source: nytimes.com

Vaccinations per capita (vaccines administered per 100 people): Cuba (298) #1 worldwide, Chile (244) #2 worldwide, Uruguay (212) #11 worldwide, Argentina (190) #30 worldwide, Ecuador (170) #40 worldwide, Brazil (169) #42 worldwide, Peru (168) #44 worldwide, Costa Rica (163) #47 worldwide, El Salvador (154) #59 worldwide, Panama (152) #61 worldwide, Colombia (139) #68 worldwide. Source: nytimes.com

Geopolitics of vaccine donations: US vs. China

  • The United States outpaces China in its donations of COVID-19 vaccines to Latin America and the Caribbean, with Colombia and Mexico topping the list. The region has received roughly 52 percent of all US COVID-19 vaccine donations. To learn more, visit our COVID-19 vaccine tracker: Latin America and the Caribbean.

Health + Innovation

  • 2 million: The number of vaccine doses Chile agreed to purchase from Moderna. Chile has begun offering a second booster shot despite already boasting one of the world’s highest COVID-19 vaccination rates.
  • Omicron: Since January 14, ten countries in South America have reported record-high cases as the variant continues to strain health systems.
  • Bolivia: Public hospitals are operating at 50-70 percent capacity due to high infeciton rates among health personnel.
  • Carnival: Rio de Janeiro postponed the world-famous festivities to late April as the number of coronavirus cases in Brazil continues to rise.
  • Caribbean: Nearly 15 countries and territories were added to the US Centers for Disease Control and Prevention’s highest travel risk category due to the ongoing surge in COVID-19 cases.
  • Argentina: On January 24, President Alberto Fernandez launched a National Vaccination Campaign against COVID-19 to ensure a full and safe return to in-person classes.
  • Paraguay: President Mario Abdo Benitez is the latest regional leader to contract COVID-19 amid the spread of the omicron variant.

Economies in focus

Economic Impact

  • In 2022, Brazil’s economy is projected to grow at only 0.9 percent, the slowest rate in the region, according to analysts from Focus Economics. 
  • Bloomberg Economics and several regional banks estimate that Mexico entered a technical recession, putting a halt to a brief recovery from the pandemic. 
  • On January 25, the International Monetary Fund warned that Argentina is at risk of high inflation “becoming entrenched.” It is expected to reach 54.8 percent at the end of 2022. 

Economic Recovery

  • According to the Association for Private Capital Investments in Latin America, startup funding tripled from 2019 to a record $15 billion in 2021 as venture capitalists look to invest in emerging markets.
  • Following growth in 2021, Peru’s finance minister said he expects the nation’s economy to grow between 3.5 and 4.0 percent.
  • In 2022, the World Bank expects the Guyanese economy to expand by 49.7 percent, the largest in the Caribbean. 
  • To stave off regional inflation, Uruguay’s Central Bank raised its benchmark interest rate 75 basis points in January with plans to return to neutral rates early in the second quarter. 

Social transformations: Bringing Silicon Valley to Latin America and the Caribbean

  • According to the open finance platform Belvo, Latin America is one of the most fertile regions for fintech innovation. 
  • Investment received by the fintech sector in Latin America jumped from $3.1 billion in 2020 to more than $9.7 billion in the first three quarters of 2021.
  • Brazil, Mexico, and Colombia are already working on their open banking regulation with results expected throughout 2022. 

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Engagement Reframed: Introduction https://www.atlanticcouncil.org/content-series/engagement-reframed/engagement-reframed-introduction/ Wed, 26 Jan 2022 20:15:54 +0000 https://www.atlanticcouncil.org/?p=476947 The Biden administration has been slow to distribute surplus COVID-19 vaccine doses to countries in need or to facilitate foreign manufacturing of vaccines, squandering a diplomatic opportunity and potentially endangering US security.

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The Scowcroft Center for Strategy and Security’s New American Engagement Initiative (NAEI) has a twofold mission: to challenge prevailing assumptions underpinning US foreign policy; and to point to alternative paths, different priorities, and a re-allocation of resources when needed to support new modes of US global engagement with allies and partners to shape the global future.

Our work is premised on the view that the United States—indeed, the world—is at a notably disruptive moment in history. An unprecedented technological revolution has accelerated the redistribution of global wealth and power in a multipolar world. Global institutions have frayed and fragmented, and America’s military and economic preeminence has begun to erode. By questioning underlying assumptions, the NAEI team will stimulate new ways of thinking about US foreign policy and recommend solutions that employ all elements of American power and influence.

NAEI’s Assumptions Testing series of issue briefs delves into major assumptions guiding US policies, including the motivations and behavior of revisionist powers; the US role in sustaining the global order; the effectiveness of coercion and deterrence; and the importance of democracy promotion. These in-depth briefs in turn inform two types of short policy briefs aimed at busy policymakers and opinion leaders:

  • The first, NAEI’s Reality Check series, focuses on specific flaws in current policy. The series has covered a range of issues—from the US military posture in the Persian Gulf to the provision of security-sector assistance to foreign partners—and identifies specific needed reforms as well as pitfalls to avoid.
  • NAEI’s newest publication series, Engagement Reframed, will suggest new ways to frame and execute America’s global role. As the title implies, the series will reimagine and reframe US engagement in the world beyond traditional, narrow notions of US military dominance to fashion a viable type of leadership in a world of many capable actors.

The Engagement Reframed series will develop new approaches for nonmilitary engagement with allies and partners, including rethinking the institutions of US foreign policy making and implementation, the specific issues and problems the United States faces, and the ways in which the scaffolding of the international system might be renovated or reengineered. These concise policy briefs will address how to employ the full range of tools at the disposal of the United States and its like-minded network. All follow a basic structure:

  1. What are the challenges and opportunities? What opportunities for engagement are US policymakers currently missing? How might different modes of engagement—or new methods of interacting with others—alter or improve existing US policy?
  2. Why now? The field of debate on US foreign policy is crowded with urgent problems. The Engagement Reframed series will stress important issues, explain the critical need for change, and highlight why a particular opportunity is worthy of policymakers’ attention.
  3. How to make it happen. The United States is no longer the world’s sole dominant power; this series is aimed at operationalizing the concept of primus inter pares (first among equals). Learning how to operate in this multipolar world of many capable actors involves making choices. Engagement Reframed will inform these choices by considering when to take the lead or share burdens with others—solving collective-action problems through diplomacy and identifying how to enfranchise other actors to find a stable balance of interests.

The Engagement Reframed briefs planned for 2022 include:

Vaccinate the world by Mathew Burrows and Evan Cooper

The United States remains the best-positioned country to lead a global vaccination drive to counter the spread of COVID-19. With poor countries in serious need of vaccines, and China’s Sinopharm, Russia’s Sputnik, and the Johnson & Johnson vaccines deemed ineffective in initial trials at fighting the Omicron variant, the United States could reap a significant diplomatic, economic, and public health windfall if it contributes to the global vaccination effort more aggressively by donating its effective vaccines, increasing foreign production capacity of such vaccines, and bringing together donor countries to revamp the global health system. In the short-to-medium term, such measures could significantly help stem the financial costs of the pandemic by preventing economies from shutting down. Over the longer term, such an effort would yield diplomatic gains by establishing the United States as a responsible leader in global health and as the premier developer of medical innovations.


Appoint a European SACEUR by Kelly Grieco

Like every American president for six decades, President Joe Biden has called for Europe to shoulder a larger part of the defense burden. US efforts to press Washington’s European allies to do more have largely fixated on one measure: defense spending levels. At the 2014 NATO summit in Wales, NATO members pledged to spend at least two percent of their gross domestic product on defense by 2024. Despite demanding that its European allies contribute more to their own defense, Washington has thus far refused to seriously consider a more equitable distribution of leading positions in NATO’s military organization. Put differently, the United States cannot have it both ways; it cannot demand that Europe do more yet still retain full military leadership of the alliance. This paper explores arguments for the appointment of a European Supreme Allied Commander Europe (SACEUR) and offers recommendations for rebalancing NATO responsibilities and commands.


Engage on Ukraine’s Future by Emma Ashford

In recent years, Ukraine has become a core flashpoint between Russia on the one hand and the United States, as well as Washington’s European allies, on the other. From the George W. Bush administration’s 2008 attempt to bring Ukraine into the NATO membership process, to the 2014 dispute over a European Union (EU) association agreement that prompted the Maidan Revolution, the question of whether Ukraine will move toward the West or retain its traditionally close ties to Russia has been fraught with controversy. The end result has been a war on Ukrainian soil and political and economic limbo for Ukraine, which cannot benefit fully from its ties with either Russia or the West. This paper steps back from security questions to explore novel ideas for economic integration of Ukraine into Western markets—giving the country the access it desires—while reassuring Russia that this will not necessarily entail full EU membership or the cessation of trade with Russia itself.


Move beyond great-power competition in Africa by Aude Darnal and Ambassador Rama Yade

Following two decades of US foreign policy primarily dominated by the global war on terrorism, Washington’s strategic competition with Beijing has motivated a shift in US engagement with the rest of the world. In Africa, the United States retains its military and security approach toward armed conflicts and instability, but the US government has increasingly framed its exchanges with the continent within the concept of great-power competition. Though the Biden administration recently affirmed that it will not ask African countries to choose between China and the United States, it has also warned some of them about their partnerships with the Asian power. Framing US engagement with the continent through the lens of great-power competition is a mistake because it implies that African countries are merely pawns in the international system. This brief explores opportunities for greater US engagement with African countries in such sectors as diplomacy, technological innovation, trade, global health, and climate change—all issues where they are valuable partners.


Bring back America’s diplomatic superstars by Evan Cooper

American culture has tremendous influence around the world, but successfully leveraging that power for diplomatic gain requires that the US government work strategically with American artists and businesses. The Jazz Ambassadors program of the 1950s and 60s—sponsored by the Department of State to promote US values globally—provides a useful model that should be applied to how the department approaches cultural diplomacy today. By partnering with some of the most popular American artists and companies, the State Department could facilitate exhibitions of American freedom of expression and artistic talent, advancing US values while helping to improve damaged perceptions of the United States abroad.


Rethink space governance by Robert A. Manning

We have entered a new era in space that is racing ahead of the world’s ability to govern it. 2021 marked an inflection point, as US and Chinese rovers explored Mars, and a Russian anti-satellite weapons test created 15,000 pieces of space debris. Private sector activities ramped up, too, including Elon Musk’s Space X activities and the Starlink mini-satellites nearly colliding with a Chinese space station. Not least, the National Aeronautics and Space Administration (NASA) launched the spectacular Webb telescope. In short, the already explosive growth of activities in space will only accelerate in this decade. Yet the only universally subscribed law governing space is the 1967 Outer Space Treaty, now outdated by both technology and politics. Meanwhile, nations are passing laws to grant claims on moon real estate and resources, the private sector is gearing up to mine asteroids and the moon, and increasing space debris threatens space assets on which the functioning of civilization increasingly depends—from global positioning systems and military command and control to the Internet and automatic teller machines. NASA has embarked on a noble effort to update rules for operations in space, the Artemis Accords, signed by thirteen US allies and partners, but the agreement omits major space powers: China, France, Germany, India, and Russia. All parties should begin with a recognition of their mutual vulnerability and admit the urgent need to manage and remove space debris. Beyond that, the United States has an opportunity to lead efforts with partners and allies to update global space governance before space becomes a Wild West free-for-all.


Expand US relations with the Caribbean by Aude Darnal and Wazim Mowla

In recent years, the United States’ engagement in the Caribbean has been largely inconsistent and limited to only a handful of countries. From the limited and delayed collaboration during the COVID-19 crisis, to the poor response to migration flows from the Caribbean, Washington has shown the limits of its current strategy to partner with the region. In parallel, increased engagement in the region by rival powers has raised the Caribbean’s profile inside the Beltway. Although the Biden administration should not look at Caribbean countries through the prism of great-power competition, it should seize the opportunity to strengthen and redefine, when necessary, a comprehensive strategy grounded in mutual interests. From climate change to trade, investment, and diplomacy, the Caribbean and the United States share common challenges and opportunities that can only be addressed or transformed into gains through cooperation.


Get creative on European security architecture by Emma Ashford

Six months ago, the Biden administration began the process of re-engaging with Russia on questions of strategic stability, including the core issues of arms control and cyber warfare. Talks have been ongoing, and a number of working groups have been set up on specific topics. Recent events, however, suggest the need for engagement on a broader set of issues rather than exclusively on arms control. Repeated Russian military buildups near Ukraine—and Moscow’s proposed outline of a revised European security architecture—suggest that the time might be ripe for revisiting the conversations from the 1990s about conventional security in Europe. Nonetheless, Moscow’s proposed language for such an agreement is likely to be largely unacceptable to Western states. This paper explores the Russian proposal for a new European security architecture and suggests areas where compromise might be found.

Other topics to be explored in the series include demographics and immigration, a plan for improving global infrastructure, relations with North Korea, governance in space, and US public attitudes toward trade, while working with allies and partners to build leverage to reshape world order.

Explore NAEI

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Wazim Mowla and Pepe Zhang in the Georgetown Journal of International Affairs: Latin America and the Caribbean’s Asymmetrical Engagement with China during the COVID-19 Pandemic https://www.atlanticcouncil.org/insight-impact/in-the-news/lac-china-asymmetrical-pandemic-engagement/ Tue, 18 Jan 2022 14:00:00 +0000 https://www.atlanticcouncil.org/?p=547461 On January 18, 2022, Wazim Mowla and Pepe Zhang co-authored an article in the Georgetown Journal of International Affairs, "Latin America and the Caribbean's Asymmetrical Engagement with China during the COVID-19 Pandemic."

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On January 18, 2022, Wazim Mowla and Pepe Zhang co-authored an article in the Georgetown Journal of International Affairs, “Latin America and the Caribbean’s Asymmetrical Engagement with China during the COVID-19 Pandemic.”

“Through strategies of problem re-definition and autonomy enhancement, LAC governments used regional and international forums to draw attention to the needs of the developing world and small states—an example of their ability to asymmetrically influence global politics and bilateral relationships,” Mowla and Zhang write.

More about our experts

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Aviso LatAm: COVID-19 January 15, 2022 https://www.atlanticcouncil.org/content-series/aviso-latam-covid-19/aviso-latam-covid-19-january-15-2022/ Sat, 15 Jan 2022 09:43:00 +0000 https://www.atlanticcouncil.org/?p=476376 Over 60 percent of Latin America and the Caribbean has been fully vaccinated against COVID-19

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​​​​​What you should know

  • Omicron: The presence of the COVID-19 variant has been confirmed in at least 27 countries and territories across the region as of January 10.
  • Second booster: As the world grapples with a surge in COVID-19 cases, Chile and Brazil are administering a second booster shot, citing initial use of less-effective Chinese-made vaccines.
  • 60 percent: The share of fully vaccinated population in Latin America and the Caribbean as of January 2.

Vaccination by the numbers

Vaccinations per capita (vaccines administered per 100 people): Cuba (280) #1 worldwide, Chile (238) #2 worldwide, Uruguay (204) #10 worldwide, Argentina (179) #30 worldwide, Ecuador (162) #41 worldwide, Brazil (160) #43 worldwide, Costa Rica (159) #45 worldwide, Peru (158) #46 worldwide, El Salvador (150) #56 worldwide, Panama (143) #62 worldwide, Dominican Republic (132) #70 worldwide. Source: nytimes.com

Percentage of population fully vaccinated: Chile (88) #4 worldwide, Cuba (86) #7 worldwide, Uruguay (77) #21 worldwide, Argentina (74) #28 worldwide, Ecuador (74) #31 worldwide, Costa Rica (71) #39 worldwide, Brazil (69) #45 worldwide, Peru (67) #48 worldwide, El Salvador (65) #55 worldwide, Panama (58) #70 worldwide. Source: nytimes.com

Geopolitics of vaccine donations: US vs. China

  • The United States outpaces China in its donations of COVID-19 vaccines to Latin America and the Caribbean, with Colombia and Mexico topping the list. The region has received roughly 52 percent of all US COVID-19 vaccine donations. To learn more, visit our COVID-19 vaccine tracker: Latin America and the Caribbean.

Health + Innovation

  • Ecuador: The first country in Latin America to declare COVID-19 vaccination mandatory for its population and all foreign travelers.
  • Colombia: The latest country to reduce COVID-19 booster vaccine waiting time to four months after completing initial vaccinations.
  • 134,439: The record number of daily COVID-19 infections registered in Argentina on January 11 – 34,000 more than the record set the previous week.
  • Brazil: Health Minister Marcelo Quiroga announced that Omicron has become the predominant strain in the country.
  • President López-Obrador: Amid the latest wave of infections fueled by the Omicron variant, Mexico’s president tested positive again after overcoming COVID-19 in early 2021.
  • 46.7 million euros: The loan Cuba expects to receive from the Central American Bank for Economic Integration (CABEI) to help bolster its COVID-19 vaccine program and ramp up production.
  • 701 percent: The increase between weekly caseloads in Guyana from December 29 to January 5.

Economies in focus

Economic Impact

  • On January 7, top investment firms reduced their predictions for Brazil’s 2022 economic growth from 0.36 percent to 0.28 percent following a technical recession in Q3 2021. 
  • On January 11, the Central Bank of the Argentine Republic raised its inflation estimate to 54.8 percent for 2022. 

Economic Recovery

  • The market for online patient telecommunication services in South and Central America is expected to reach $278.9 million by 2027 from $79.7 million in 2019. 
  • Vice President Harris announced that new private sector investments to boost economic recovery and curb migration in Central America now reach $1.2 billion. 
  • The Organisation for Economic Co-operation and Development (OECD) projects Mexico’s economy to expand by 3.3 percent in 2022, fueled by an improvement in the labor market and a rise in vaccinations. 

Social transformations: Digitalization as a tool for regional recovery

  • The COVID-19 pandemic highlighted the need for greater digital access in Latin America and the Caribbean. In 2021, less than 50 percent of the region had fixed broadband connectivity. 
  • In their Caribbean Quarterly Bulletin Regional Overview, the Inter-American Development Bank (IDB) estimated that closing the digital access gap between Caribbean economies and OECD member countries could increase the region’s GDP by about 6 to 12 percent.
  • Increasing digital access allows for distance learning, digital cash transfers, telemedicine, and online public services—critical not only during the pandemic but for long-term regional prosperity. 

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State of the Order: Assessing December 2021 https://www.atlanticcouncil.org/commentary/blog-post/state-of-the-order-assessing-december-2021/ Thu, 13 Jan 2022 17:43:55 +0000 https://www.atlanticcouncil.org/?p=475605 The State of the Order breaks down the month's most important events impacting the democratic world order.

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In case you missed it, please read our year-end special edition of State of the Order: Looking Back on 2021, available here.


Reshaping the order

This month’s topline events

Biden’s Democracy Summit. President Biden hosted more than one hundred world leaders for a virtual two-day Summit for Democracy, with an agenda focused on countering authoritarianism, promoting human rights, and combating corruption. EU Commission President Ursula von der Leyen followed Biden in welcoming participants to the summit, which kicked off what the administration is calling a “year of action” that will culminate in a second planned in-person summit in late 2022.

  • Shaping the order. The Summit served to rally democracies as the world faces fifteen consecutive years of a democratic recession. While it did not produce any significant new initiatives, it helped advance the Biden administration’s efforts to set the global agenda around a narrative of strategic competition between democracy and autocracy – increasingly the frame around which many US allies and partners are orienting their own foreign policies.
  • Hitting home. In the aftermath of the January 6 insurrection and a deeply polarized electorate, the United States is facing its own challenges to democracy at home which must be addressed, even as it seeks to promote democracy overseas.
  • What to do. As it prepares for a second summit later this year, the administration should seek support for a global democratic charter, while concentrating on a more focused set of issues to drive summit action, such as pushing back on autocratic coercion and countering disinformation. It should also explore ways to formalize a network or alliance of democracies to sustain momentum behind this series of summits.

Russia’s NATO Gambit. Russia outlined sweeping new proposals calling for the redrawing of European security arrangements, including a NATO guarantee not to allow any new nations to join the alliance and a halt to all NATO military activities in Eastern Europe. US and NATO officials dismissed the proposals, but during a phone call with Russian president Vladimir Putin, Biden agreed to further discussions, including through the NATO-Russia Council and the Organization for Security and Cooperation in Europe (OSCE).

  • Shaping the order. Putin seeks to undermine the basis of an undivided Europe that emerged at the end of the Cold War. With Russian troops positioning for a potential re-invasion of Ukraine, Moscow’s proposals appear aimed at pressuring the US and its allies to formalize a Russian sphere of domination in Eastern Europe – which runs contrary to the principle that sovereign nations have the right to determine their political and security arrangements without coercion or interference from outside powers.
  • Hitting home. Americans benefit from a world in which nations are free from threats of coercion and invasion, and where a strong and stable Europe serves as a vital trading partner.
  • What to do. As it engages Moscow to explore the possibility of a reasonable diplomatic solution, the Biden administration and US allies should reject any outcomes that would give the Kremlin veto power over NATO expansion or defense posture, and should push back on Russia’s attempts to carve out a sphere of influence in Eastern Europe.

Beijing Olympics Boycott. The United States announced a diplomatic boycott of the 2022 Winter Olympics in Beijing to protest China’s human rights abuses, particularly in Xinjiang, where China has engaged in crimes against humanity against the Uyghurs. Australia, Canada, Japan, Britain, and several other European governments joined in the boycott, but other key allies, including France, Germany, and South Korea, have not.

  • Shaping the order. The boycott is a symbolically significant move that showcases Beijing’s oppressive human rights practices and sends the message that China will not be treated as a legitimate member of the global community of nations while it engages in atrocities against the Uyghurs. But it also risks exposing a divide between the US and its allies on dealing with China, which Beijing will seek to exploit.
  • Hitting home. The boycott precludes government officials from attending the Olympics but will not affect the ability of US athletes, who have been training for years, to compete in the games.
  • What to do. The Biden administration should continue to encourage allies to join the Olympics boycott, which would have a far greater impact if leading democracies act in unison. As the games begin, Washington should also look to issue a joint statement of concern among allies over Beijing’s human rights abuses to ensure this remains front and center.

Quote of the month

“[A]s a global community for democracy, we have to stand up for the values that unite us… [W]e’re bringing together leaders from more than 100 governments… to lock arms and reaffirm our shared commitment to make our democracies better… and to make concrete commitments of [how] to strengthen our own democracies and push back on authoritarianism.”

– President Joe Biden, Summit for Democracy, December 9, 2021

State of the Order this month: Unchanged

Assessing the five core pillars of the democratic world order    

Democracy ()

  • As part of the Kremlin’s campaign to stifle political dissent, Russia’s Supreme Court ordered the shutdown of a venerable and respected human rights organization, Memorial, which was established during the Gorbachev reform era to document Stalin’s great terror and Soviet (and later Russian) human rights abuses.
  • Beijing forced the closure of the most prominent pro-democracy media outlet still operating in Hong Kong, and arrested and sentenced media professionals and activists as part of its continuing assault on democratic institutions.
  • As described above, the United States, Canada, Britain, Australia, Japan, and other nations announced a diplomatic boycott of the 2022 Winter Olympics in Beijing to protest China’s human rights abuses against the Uyghurs. Separately, President Biden signed the bipartisan Uyghur Forced Labor Prevention Act which bans imports from Xinjiang.
  • Also as described above, President Biden hosted more than one hundred world leaders for a virtual two-day Summit for Democracy, with an agenda focused on countering authoritarianism, promoting human rights, and combating corruption.
  • With the summit focusing global attention on the challenges facing democracy, overall the democracy pillar was strengthened.

Security (↔)

  • A new round of diplomatic negotiations between Iran and leading powers resumed in Vienna, as Israel’s defense minister ordered his forces to prepare for a potential military option if negotiations fail to constrain Iran’s nuclear advances.
  • Russia maintained its military buildup near the Ukrainian border, while Biden warned Putin that it would pay a “heavy price” should Russia invade Ukraine.
  • In a 90-minute video call, their second of the year, Vladimir Putin and Xi Jinping reaffirmed mutual solidarity in the wake of rising tensions with the US and its allies. Xi reportedly backed Putin’s push for security guarantees over Ukraine.
  • While several troubling developments appear to be on the horizon, the security pillar this month remained unchanged.

Trade (↔)

  • South Korea will seek to join the CP-TPP, joining a growing list of applicants for the Asia-Pacific free trade agreement, including China and Taiwan – though the United States has so far refused to rejoin.
  • The US-China Phase One Deal, which entered into force in February 2020, expired this month amid criticisms that China failed to meet its obligations to a more balanced trade relationship.
  • Overall, the global trade pillar was unchanged.

Commons ()

  • The highly contagious Omicron variant became the dominant COVID strain in several countries around the world, including the United States, leading to an unprecedented rise in coronavirus cases and prompting new lockdowns and travel restrictions.
  • Russia vetoed a UN Security Council resolution calling for climate change to be treated as a threat to international peace and security. India also voted against the measure, while China abstained.
  • With Omicron spreading, the global commons pillar was weakened.

Alliances ()

  • G7 foreign ministers, meeting in Britain, issued a joint statement condemning Russia’s military buildup and “aggressive rhetoric towards Ukraine.”
  • In a call with Ukrainian president Volodymyr Zelensky, Biden reaffirmed US support for Ukraine. Separately, Biden reassured the leaders of nine eastern flank NATO allies — Bulgaria, Czech Republic, Estonia, Hungary, Latvia, Lithuania, Poland, Romania, Slovakia – of America’s commitment to collective defense.
  • Olaf Scholz was sworn in as Germany’s new chancellor, replacing Angela Merkel after 16 years as leader of Europe’s largest democracy. Scholz joined Biden’s Summit for Democracy and later spoke to Biden in a phone call during which the two leaders reportedly discussed Russia’s military buildup and transatlantic cooperation.
  • Overall, the alliances pillar was strengthened.

Strengthened (↑)________Unchanged (↔)________Weakened ()

What is the democratic world order? Also known as the liberal order, the rules-based order, or simply the free world, the democratic world order encompasses the rules, norms, alliances, and institutions created and supported by leading democracies over the past seven decades to foster security, democracy, prosperity, and a healthy planet.

This month’s top reads

Three must-read commentaries on the democratic order     

  • Janet Yellen and Samantha Power, in the Washington Post, argue that defending democracy requires comprehensive, disciplined US leadership to combat corruption at home and abroad.
  • Michael Schuman, writing in The Atlantic, warns of China’s increasingly aggressive efforts to erode and rewrite the US-led rules-based order.
  • Michael Fullilove and Hervé Lemahieu, in Foreign Affairs, contend that the United States is outpacing China in terms of power and influence in the Indo-Pacific.

Action and analysis by the Atlantic Council

Our experts weigh in on this month’s events

  • Ahead of the Summit for Democracy, Ash Jain, Matthew Kroenig, and Jonas Parello-Plesner launched a report, An Alliance of Democracies: From Concept to Reality in an Era of Strategic Competition, proposing an Alliance of Democracies to strengthen democratic cooperation and position the free world for success against revisionist autocracies.
  • Fred Kempe, in CNBC, previews 2022 as a year where democracies, particularly the US, must adapt and regroup to defend the rules-based order against autocrats’ geopolitical ambitions.
  • Rose Jackson, in testimony to the US Senate Subcommittee on Communications, Media, and Broadband, provided key recommendations to address the harms posed to democracies by digital technologies and misuse of social media platforms.
  • Andrew Marshall, in the New Atlanticist, discusses how the latest NATO-Russia standoff could redefine European security and the transatlantic relationship.
  • Nicole Bibbins Sedaca, in The Bulwark, argues that the Summit for Democracy’s impact will be defined by its ability to catalyze a new global movement for democratic action.
  • In a Strategic Insights Memo, Ash Jain contends that the Summit for Democracy served as a capstone for the Biden administration’s efforts to frame a global narrative around the growing strategic competition between democracy and autocracy.

__________________________________________________

The Democratic Order Initiative is an Atlantic Council initiative aimed at reenergizing American global leadership and strengthening cooperation among the world’s democracies in support of a rules-based democratic order. Sign on to the Council’s Declaration of Principles for Freedom, Prosperity, and Peace by clicking here.

Ash Jain – Director for Democratic Order
Dan Fried – Distinguished Fellow
Jeffrey Cimmino – Associate Director
Danielle Miller – Program Assistant

If you would like to be added to our email list for future publications and events, or to learn more about the Democratic Order Initiative, please email AJain@atlanticcouncil.org.

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Spotlight: Latin America and the Caribbean – Ten questions for 2022 https://www.atlanticcouncil.org/commentary/ten-questions-for-2022/ Tue, 04 Jan 2022 13:00:00 +0000 https://www.atlanticcouncil.org/?p=470439 The year 2022 will be one of change across the Western Hemisphere. So, what might or might not be on the horizon?

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The year 2022 will be one of change across the Western Hemisphere. So, what might or might not be on the horizon?

The year 2022 will be one of change across the Western Hemisphere. From presidential elections in Brazil and Colombia to newly elected presidents taking office in Chile and Honduras, regional leaders will be looking at new ways to rebuild economies from the COVID-19 pandemic while balancing mounting social pressures. So, what might or might not be on the horizon in 2022?

Join the Adrienne Arsht Latin America Center as we look at some of the key questions that may shape the year ahead for Latin America and the Caribbean, then take our signature annual poll and see how your opinions shape up against our predictions.

How might key presidential elections shake out? Will regional economies recover to pre-pandemic growth rates? What might be the outcome of the US-hosted Summit of the Americas, and will Caribbean voices play a larger role than in previous gatherings? Will the region expand its ties with China?

Take our ten-question poll in less than five minutes!

Question #1: Caribbean – Will Vice President Kamala Harris make her first trip to the Caribbean in 2022?

Question #2: Central America – Will the United States have confirmed ambassadors in all three northern Central American countries (currently only Guatemala) by year-end 2022?

Question #3: Chile – Will the new Chilean constitution be approved when put to a referendum?

Question #4: China and Latin America – Considering Nicaragua’s newly established China ties, will the three other Central American countries that currently recognize Taiwan—Belize, Guatemala, and Honduras—also switch recognition to China?

Question #5: Colombia – Will Colombia’s presidential election go to a second round?

Question 6: Economy – Can the region recover pre-pandemic growth rates in 2022?

Question #7: Mexico – Will Mexico remain the United States’ top trading partner throughout the next year?

Question #8: Bitcoin – Following in El Salvador’s footsteps, will support for Bitcoin tender grow in the region?

Question #9: Venezuela – Will Nicolas Maduro return to the negotiating table in Mexico City?

Question #10: Brazil – Will President Jair Bolsonaro win another term this year?

Bonus Question: Will Latin America and the Caribbean be represented in the final of the World Cup?


Our answer to question #1: YES

In 2022, the Biden-Harris administration will look for big wins and opportunities to expand its leadership in the Americas. This is achievable in the Caribbean with a high-profile visit, which would optimally be accompanied by a major policy announcement from Vice President Harris. President Joe Biden was the last vice president to visit the region, where he focused his time discussing the Caribbean Energy Security Initiative.

The stage is set for a similar visit to occur with Vice President Harris. Economic recovery is slow, vaccine hesitancy is increasing, and other actors, such as China, are playing a more active role in the Caribbean. Regional leaders often note that US attention is inconsistent, and that few high-profile US officials travel to the Caribbean. A visit and subsequent policy announcement that aids the Caribbean in its time of need would build on recent conversations between the Vice President and Prime Minister of Trinidad and Tobago Keith Rowley (virtual) and Prime Minister of Barbados Mia Mottley (in person).

Our answer to question #2: NO

Given President Nayib Bukele’s recent personal attacks against President Biden and other US government officials, including Ambassador Jean Manes and current Charge d’Affaires Brendan O’Brien, it is unlikely that the United States will confirm all ambassadors to the Northern Triangle countries. President Bukele’s attacks were a response to the Biden administration’s decision to add Osiris Luna Meza, the chief of the Salvadoran penal system and vice minister of justice and public security, and Carlos Marroquin, chairman of the Social Fabric Reconstruction Unit, to the Specially Designated Citizens and Blocked Persons List. Both Salvadoran officials are accused of having a direct relationship with gangs, including MS-13. In Honduras, however, a new administration under President-elect Xiomara Castro provides a renewed sense of cooperation between the United States and the Central American country.

Our answer to question #3: YES

Once the constitutional draft is finalized by summer 2022, the Constitutional Convention will vote to approve or reject the new legal charter. If the body rejects the new constitution, Chile will keep its current one. However, if it is approved, the group will present the document to the newly elected head of state, who, in turn, will issue a call for a national referendum in which Chileans will vote to approve or reject the new constitution. Voting will be mandatory, and the new constitution will move forward only if an absolute majority is achieved.

While 78.3 percent of voters cast their ballot in favor of a new constitution in 2020, rising polarization and inefficiencies within the Constitutional Convention have left thousands of Chileans disenchanted with the reform process. However, the desire for fundamental changes remains high. If the new legal charter is approved by Chilean voters, it will be put into effect shortly after the vote through a formal ceremony. However, if Chile votes to reject, the 1980 Constitution written under Augusto Pinochet will remain in place. With just one opportunity to get the new constitution approved, the convention will attempt to generate a moderate bill that will stimulate consensus among the political left and right.

Our answer to question #4: NO

It is unlikely that all three of Taiwan’s Central American allies will switch recognition to China in 2022. But, considerations of international benefits, domestic political agency, or both may prompt a change in at least one of the countries. Internationally, US COVID-19 vaccine donations far outstripped those of China, sending a reassuring message to Taiwanese allies in the region.

But, Chinese vaccine diplomacy—including early, well-publicized vaccine sales and shipments—and broader medical, humanitarian, and economic assistance could still prove alluring for countries in need. Despite running with a pro-China message, Honduran President-elect Xiomara Castro recently declined to switch diplomatic recognition from Taiwan to China. Absent any external shocks, Belize, Guatemala, and Honduras will likely attempt to maintain the status quo for as long as possible, favoring Taiwan while leaving the door open for closer ties with China. This delicate balancing act has served to remind larger countries not to take their allegiances for granted and will continue to do so. But, it will be increasingly tested, as seen with Nicaragua, in the critical and uncertain year ahead.

Our answer to question #5: YES

There has yet to be an election in Colombia’s history in which a president is elected in the first round. Senator Gustavo Petro, who served as mayor of Bogotá (2012–2014), leads the left-wing political party Colombia Humana, and was the runner-up in the 2018 presidential election against incumbent President Ivan Duque. With nearly 42 percent of the vote, Petro has positioned himself as the candidate with the greatest support from Colombian voters.

However, Petro currently polls at 25.4 percent, which is not enough for an absolute majority that will grant him the presidency in the first round. Petro will most likely go to a second-round vote against a center-right or center-left candidate, potentially former Mayor of Bucaramanga Rodolfo Hernández or former Governor of Antioquia Sergio Fajardo. To date, Hernández polls at 11 percent and Fajardo at 7 percent. As recommended by the Atlantic Council’s US-Colombia Task Force, co-chaired by Senators Roy Blunt and Ben Cardin, strengthening the alliance between Colombia and the United States ahead of 2022 presidential elections is paramount to safeguard Colombia’s gains in terms of development, rule of law, and democracy. Regardless of election results, the United States should continue to position itself as Colombia’s strongest ally, advancing stability and prosperity at home and abroad.

Our answer to question #6: YES

Led by its five major economies, regional gross domestic product (GDP) is on track to return to pre-pandemic levels in 2022, though per-capita income will likely not recover until 2023. Key uncertainties may alter this outlook: the extent of success in vaccination and pandemic management, stimulus trade-off between continued support and fiscal discipline, labor markets (currently experiencing slower recovery than GDP), inflation, electoral outcomes, and external conditions including evolving investor appetite and commodity prices.

The region as a whole is not expected to return to pre-pandemic growth trajectories in the coming years, signaling permanent output losses due to COVID-19. In a divergent recovery, smaller and vulnerable states, such as those in the tourism-dependent Caribbean, are experiencing an even slower return to normal. Lastly, Latin America and the Caribbean (LAC) should set an ambitious agenda beyond “recovery”—given unimpressive pre-pandemic growth rates and patterns—and, rather, seek ways to accelerate development and build forward in a more inclusive, productive, and sustainable way.

Our answer to question #7: YES

It is likely that Mexico will remain the United States’ top trading partner throughout 2022. Mexico currently holds the top position—overtaking China in February 2021—with Canada in the second spot, lagging behind by $2.9 billion in total trade. COVID-19 significantly hindered US-Mexico trade—which largely relies on land trade via trucks and railcars—due to the pandemic-induced land-border closures to “non-essential” traffic. As of November 8, 2021, however, the United States reopened its borders to non-essential traffic and booming commerce is expected along the border. Moreover, US-Mexico trade topped $545 billion through October 2021 (the most recent data available), an increase of over 24 percent from one year earlier. Given the highly integrated nature of US-Mexico trade in the automotive and energy sectors, coupled with the efforts in border cities and ports to increase capacity and efficiency, trade is likely to continue to grow between the United States and Mexico.

Our answer to question #8: YES

Bitcoin presents an attractive option for countries in Latin America and the Caribbean, yet those countries will not replicate El Salvador’s approach. The government of El Salvador claimed that adopting Bitcoin would reduce financial exclusion and high remittance fees. These issues also affect the entire region. The World Bank predicted that remittances to Latin America and the Caribbean rose 21.6 percent in 2021, costing roughly $6.9 billion in remittance fees. According to the International Monetary Fund (IMF), financial inclusion in the region falls below global averages, and is exacerbated in the Caribbean due to the de-risking of correspondent banks. The worsening effects of climate change will also likely generate support for a decentralized virtual currency, as remittances typically increase following natural disasters, alongside decreased access to financial institutions.

Despite Bitcoin’s allure, its implementation in El Salvador has been marred by technological unreliability, weak financial regulations, and high price volatility. Politicians in Paraguay, Mexico, and Panama have already introduced legislation to regulate Bitcoin’s use as legal tender, and more will follow in 2022. As support for Bitcoin rises, so will debates on its social and environmental risks. Countries across the region will chart their own paths instead of following El Salvador’s playbook.

Our answer to question #9: YES

Although, the latest round of negotiations in Mexico has been suspended since October 2021, a combination of long-term incentives will likely propel Maduro to negotiate with the Venezuelan Unitary Platform—the umbrella organization encompassing the main political opposition parties in the country. Maduro seeks access to capital, legitimacy, guarantees against prosecution, and division within factions of domestic opponents—all of which he can accomplish through negotiations.

However, these factors are not the only ones at play in determining Maduro’s negotiation participation. After the highly visible diverging strategies within the opposition during the recent regional elections—and Julio Borges’ recent resignation and call for the interim government’s dissolution—Maduro might decide to simply wait out further erosion of opposition unity, instead of engaging with it directly. The success of such a strategy, if taken, would enhance the regime’s monopoly on power.

Our answer to question #10: Too early to call.

The odds are not in his favor, but it’s too early to say. Recent polls suggest that President Bolsonaro and former President Luiz Inacio Lula da Silva will face each other in a second round of elections, repeating the 2018 Bolsonaro versus Workers’ Party (PT) duel. However, this time around, former President Lula, as the PT candidate, is leading the way in early polling. Both candidates have a strong support base, but former President Lula’s history with corruption and President Bolsonaro’s mismanagement of the pandemic and current economic hurdles also give them significantly high rejection rates.

Third-way candidates, such as President Bolsonaro’s former minister of justice, Sergio Moro—famous for leading the Car Wash Operation that put President Lula in jail—is running on an anticorruption, center-right platform. Those Brazilians who in 2018 voted for President Bolsonaro as a “vote against corruption” might be more inclined to seek other alternatives. Current high inflation and unemployment rates might also play against President Bolsonaro’s reelection. Having said that, it will likely be a close race, and there is still a long way to go until elections in October 2022.

BONUS QUESTION ANSWER: YES

Brazil and Argentina are the only Latin American counties that have already qualified for the 2022 World Cup. In the Caribbean, Jamaica seems to be the only country with a chance of qualifying. While it is impossible to know who will be in the final (RIP Paul the Octopus), Brazil and Argentina are always strong contenders.

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Pepe Zhang in BBC News Mundo: Los 3 pilares de la expansión china en América Latina y el Caribe en dos años de pandemia https://www.atlanticcouncil.org/insight-impact/in-the-news/bbc-news-china-lac/ Thu, 30 Dec 2021 21:31:00 +0000 https://www.atlanticcouncil.org/?p=548153 On December 30, 2021, Pepe Zhang was quoted in a BBC News Mundo article, "Los 3 pilares de la expansión china en América Latina y el Caribe en dos años de pandemia" ("The 3 pillars of Chinese expansion in Latin America and the Caribbean in two years of the pandemic")

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On December 30, 2021, Pepe Zhang was quoted in a BBC News Mundo article, “Los 3 pilares de la expansión china en América Latina y el Caribe en dos años de pandemia” (“The 3 pillars of Chinese expansion in Latin America and the Caribbean in two years of the pandemic”).

Quoted in Spanish, Zhang’s remarks translate as follows: “Although FDI flows from China have slowed during the pandemic, trade relations remain robust and resilient. It’s likely that 2021 will be another record year for trade between China and LAC.”

More about our experts

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Warrick in the Hill on preventing extremist recruitment https://www.atlanticcouncil.org/insight-impact/in-the-news/warrick-in-the-hill-on-preventing-extremist-recruitment/ Thu, 23 Dec 2021 15:11:00 +0000 https://www.atlanticcouncil.org/?p=473050 Forward Defense nonresident senior fellow Thomas S. Warrick considers how to avoid extremist recruitment of unvaccinated service members.

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On December 23, Atlantic Council nonresident senior fellow and Future of DHS Project director Thomas S. Warrick published an article in the Hill titled “Pentagon must act to prevent extremist recruitment of unvaxxed service members.” In the article, Warrick and co-author Javed Ali argue that, while unvaccinated US servicemembers poses a threat to military readiness, requiring vaccinations could potentially outcast unwilling military personnel and leave them susceptible to extremist recruitment.

Individuals who joined the military did so out of patriotism and loyalty to the country, and many who hesitated to get vaccinated nevertheless did so when the order went out.

Thomas S. Warrick and Javed Ali

Forward Defense, housed within the Scowcroft Center for Strategy and Security, generates ideas and connects stakeholders in the defense ecosystem to promote an enduring military advantage for the United States, its allies, and partners. Our work identifies the defense strategies, capabilities, and resources the United States needs to deter and, if necessary, prevail in future conflict.

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Welcome to 2030: Three visions of what the world could look like in ten years https://www.atlanticcouncil.org/content-series/atlantic-council-strategy-paper-series/welcome-to-2030-three-visions-of-what-the-world-could-look-like-in-ten-years/ Tue, 21 Dec 2021 05:00:00 +0000 https://www.atlanticcouncil.org/?p=463624 Well into the 2020s, COVID-19 will cast a long shadow over communities, workplaces, markets, battlefields, and negotiating rooms. But even as the centrifugal forces driving the world away from multilateralism and toward multipolarity accelerate, the future is not fixed. We humans have agency in shaping it.

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Welcome to 2030

Three visions of what the world could look like in ten years

By Mathew Burrows and Anca Agachi

Pandemics have often proven turning points in history. The Black Death in the 1300s helped undermine feudalism, while some believe the Spanish flu tipped the balance in favor of the Allied cause in the final days of the First World War. Yet the current one has been less a disruptor than an accelerator of trends that were already fraying the fabric of the post-Cold War international system long before the outbreak of SARS-CoV-2. 

Two grueling years into the pandemic, it feels like we’ve seen it all. But it may just be that we ain’t seen nothing yet. Many of COVID-19’s effects on twenty-first century human civilization, in fact, are not yet visible. Much of the non-Western world still awaits sufficient vaccines, and the fallout from pandemic-induced economic downturns will unfold over the course of years, just as the repercussions of the 2008 global financial crisis did. Meanwhile, Sino-US hostility exacerbated by the public-health crisis raises the specter of large-scale conflict after decades of relative peace among the world’s most powerful states. Also suffering serious and hugely consequential setbacks: the march of globalization and the multilateralist architecture designed after World War II to maintain peace.

So what lies ahead? Well into the 2020s, COVID-19 will cast a long shadow over communities, workplaces, markets, battlefields, and negotiating rooms. But even as the centrifugal forces driving the world away from multilateralism and toward multipolarity accelerate, the future is not fixed. We humans have agency in shaping it.

Here, building on our work on strategic foresight and global trend analysis inside the US intelligence community and outside government, we envision three alternative worlds in 2030. The intention is not to predict what’s coming next, but rather to highlight the factors that could lead the world in one direction or another—and thus provide insights that can spur strategists to prepare for possible challenges, plan for potential opportunities, and pursue a brighter future by making prudent decisions in the present. Instead of a crystal ball, what we offer are portals to different universes.

The scenarios in this ten-year forecast are informed by ten significant trends outlined below that are already transforming today’s world and likely to shape the world a decade from now as well.

1. The vaccine miracle—and cautionary message

The development of COVID-19 vaccines was remarkably rapid, with those most vulnerable to the virus in rich countries inoculated within a year of the pandemic breaking out. If vaccine development and distribution had been slower, the death toll from the disease would now be several times higher. The tragedy, however, is that poorer countries still lack enough vaccines; although a small majority of the world’s population has now received at least one dose, coverage remains highly uneven; in Africa, for example, less than 12 percent of the population has received at least one dose as of December. The longer a substantial portion of the world’s population remains unvaccinated, the higher the risk that more contagious variants like Delta and Omicron emerge.

Absent the vaccines, a much deeper global recession would have also ensued. Western countries would have gone into greater debt to cover health and unemployment costs, and struggled more to emerge from the crisis. The World Bank anticipates that economic growth in advanced economies will be almost twice as fast in 2021 as it was after the Great Recession. The fact that many Western policymakers were involved in or closely observed the response to the global financial crisis was an advantage: They pushed for higher stimulus than in 2008-09.

Will the current crisis yield similar wisdom for subsequent ones? The scale of this pandemic—only comparable to the Spanish flu a century ago—should not lull the world into thinking another one won’t emerge in the near future. There is peril in wasting this opportunity to build more global resiliency, particularly for those without the means to weather such disasters. Will lessons be learned from the inequitable delivery of vaccines? Will the developing world gain the manufacturing capacity to ensure speedier distribution of vaccines next time? There should be no “losers” in a vaccine scramble. Yet who wants to bet that the developed world has learned this lesson—or that it grasps the long-term damage already done to its reputation in the rest of the world?

2. Technology’s double-edged sword

If science came out of the pandemic a winner, technology was a close second. Without computers and connectivity, the lockdowns could have ground most economic activity to halt. Managers were surprised by the productivity of remote work. Some types of work, however, could not move online. Those in service jobs—including many ethnic and racial minorities—could not stay at home and were thus disproportionally affected by the COVID-19 crisis.

The future of work will be hybrid, with in-person and remote aspects. While telework has been around for decades, it took a transformative event to force the paradigm shift. To the extent that workers can benefit from a more flexible routine, this could be a positive development for keeping more people in the workforce—helping to persuade working mothers (who were disproportionately impacted by the economic fallout of the pandemic) to reenter and seniors to stay employed. But other challenges, including long-term job insecurity as automation progresses, will offer more tests but few easy solutions.

3. Here comes deglobalization

The developing world has lost many of the benefits of globalization—at least for the time being. A significant portion of the once-rising global middle class slid back into poverty as a result of the pandemic and its economic ramifications, reversing perhaps humanity’s biggest achievement in recent decades. Without targeted policy interventions, the world is verging on return to a two-speed world of “haves” and “have nots.” With the pandemic still raging in the developing world, the full extent of the damage to that new global middle class remains unknown. Some countries will gain strength from overcoming pandemic-related challenges, but the weakest will probably experience growing political instability and even state failure.

For many poor countries, recovery from the dislocations of deglobalization is further complicated by other challenges. The threat of food crises, for example, has increased for nations suffering endemic conflict plus the added strain of the pandemic and global economic slowdown. At least 155 million people in fifty-five countries and territories were estimated to be in danger of serious food deprivation or worse in 2020—an increase of around twenty million people since 2019—with catastrophic conditions in countries such as Afghanistan, Yemen, Burkina Faso, South Sudan, and the Democratic Republic of the Congo.

Another challenge in surmounting the consequences of deglobalization is climate change. Africa’s gross domestic product, for example, could decline by 15 percent by 2030 as a result of climate-related disasters and spending on efforts to adapt to a warming world, according to the Economic Commission for Africa. African leaders aiming to overcome these challenges can look to trade and economic-reform opportunities. The African Continental Free Trade Area officially started trading on January 1, 2021, and estimates suggestthat trade liberalization could increase African real income by $450 billion by 2035. Such a development could blunt the damage inflicted by COVID-19 and help boost the continent’s post-pandemic economic recovery.

4. The deepening of domestic disorders

Today there is more inequality not just between developed and developing countries, but also within many of these countries themselves. This is the second major global economic crisis in a little more than a decade, battering those who had already suffered setbacks in establishing their careers or who had only recently picked up the pieces from the 2008 financial crisis. In the United States, for instance, many women left the workforce during the pandemic to take care of their kids when childcare centers closed and schools switched to remote learning, while ethnic and racial minorities have continued to suffer from higher unemployment than the working population as a whole.

In advanced economies, the relatively rapid recovery is a hopeful sign for those hurt economically by the pandemic. Yet the future of work will remain turbulent, particularly for the unskilled and semiskilled. The pandemic spurred employers in some industries to invest more in robotics and automation rather than recruiting and training workers. Even before the coronavirus crisis, in fact, there were numerous forecasts that greater automation was coming. That practice could now speed up, further increasing inequality and job insecurity.

The Internet and social media—so vital in maintaining economic activity—have also unleashed forces that threaten democracy. On the one hand, new digital platforms support freedom of expression, offer new possibilities for democratic participation, and provide access to diverse information. For authoritarian leaders, the expansion of information and communications technology can be a menace in providing citizens with powerful tools to mobilize against the regime. On the other hand, new technology platforms give birth to information bubbles and polarization, increase the effectiveness of misinformation and disinformation, and promote a nonconsensual culture of debate. Hate speech and conspiracy theories pose an increasing danger to civic trust and democratic political order. In democracies, extremist and populist parties have been able to capitalize on these dynamics. These technologies also enable corporate and state entities to engage in potent new forms of surveillance and information manipulation.

Tech companies oppose government measures to address these concerns that go against their business models, while governments themselves worry about the impacts of such measures on innovation and national competitiveness. With more regulations increasingly likely in Western countries to guard against harm to children and better protect privacy, the burning question is how to balance these potentially conflicting objectives.

5. Meet the New World Order 2.0

The pandemic could have been a catalyst for a rebirth in global cooperation, but instead it revealed just how frayed the world’s multilateral structures are. This largely proved to be a time for the nation-state to take charge, as countries closed borders, instituted lockdowns, and looked after their own interests.

Given how much mutual distrust the pandemic has sowed between China and the West, it will be hard for them to reach consensus on reforming the World Health Organization. That same distrust is evident in other international institutions. The United Nations Security Council has been paralyzed by Russia and China working together to wield their veto power. While the Biden administration has recommitted the United States to the Paris climate accord, it has yet to move ahead on an effort with European nations to reform the World Trade Organization, which is critical to the running of a rules-based trading system. We are living through an age of multipolarity without multilateralism.

After the end of the Cold War, the George H.W. Bush administration talked about a “new world order.” It envisioned a return to the original conception for a post-World War II multilateralist global order that never took shape due to divisions between the Soviet Union and United States. In such a world, so the thinking at the time went, countries would cooperate to solve common problems and strive for Western values such as democracy and liberal markets.

Three decades later, the pendulum has swung in the opposite direction. Sino-US tensions make military conflict between great powers conceivable again for the first time since the end of the Cold War. The Biden administration has chosen not to reverse or even temper the growing US hostility toward China that was a hallmark of the Trump administration. China, meanwhile, is rushing headlong to claim its perceived rights as a great power, determined to call into question any US pretense to unrivaled global leadership.

Just beneath the surface of US angst are fears of a world in which China displaces the United States as the dominant political and economic player. In the words of President Joe Biden, China has “an overall goal to become the leading country in the world, the wealthiest country in the world, and the most powerful country in the world. That’s not going to happen on my watch.”

China will probably overtake the United States later this decade or early in the next one to become the world’s biggest economy as measured by market value. Most Europeans believe that China is already the dominant economic player, according to the Pew Research Center. But the US public is not ready to concede that preeminent position, which suggests that once the shift happens it will deal a psychological blow to Americans—having the effect of pulling the rug out from under the nation’s “exceptional” destiny. Also striking in the Pew polling is that neither age nor political-party affiliation was a big factor in whether or not the American public had unfavorable views toward China, heightening the sense of a unified America engaged in a contest with China in which perceived defeat would be keenly felt. For Europeans who lost empires some time ago, the idea that the United States would be immune from relative economic decline seems unrealistic.

The United States and China may well find a pragmatic framework for cooperating on select mutual interests. Significant advances—the Helsinki Accords’ human-rights agenda and arms-control agreements, for example—were made during the Cold War when it suited Washington and Moscow. One should not dismiss such possibilities. Yet the chances of US and Chinese leaders collaborating to build a more multilateralist world look dim, at least for the next decade.

Biden hopes to constitute a democratic order with US allies and partners, excluding China, Russia, and other authoritarian countries. On most global issues, this would be unworkable—and perhaps dangerous. The Versailles peace settlement after World War I ignored the Soviet Union and Germany, with disastrous consequences. No viable global order is possible without inclusion of all the major powers, including Russia and China.

China does not have any kind of multilateralist blueprint in mind for the global order and doesn’t want Western-designed global institutions to set the rules for international relations. Chinese leaders know that the county’s breakout as a global power on a par with the United States won’t be frictionless. What China wants is a world that won’t hinder its brand of state capitalism and authoritarian rule. As a rising power and former victim of colonial exploitation in the nineteenth and early twentieth centuries, China is sensitive to any perceived curbs on its sovereignty, believing that its great-power status gives it the right to regional, if not global, sway. Chinese leaders want to find ways to circumvent (and perhaps, over time, even supplant) the United States, which has used the web of multilateral institutions to anchor its global power.

6. Climate change: Where some Sino-US competition might actually be good

Even on issues like climate change, where China and the United States have obvious common interests, cooperation and competition will likely both occur. That may, in fact, be the best outcome.

Biden has talked about the United States producing the needed technology to fight climate change, yet as the Financial Times has noted China “dominates the sourcing, production, and processing of key clean-energy minerals worldwide” and is the global leader in clean-tech manufacturing. It controls around 70 percent of lithium-ion battery metals and processing along with 90 percent of the rare-earth elements used in high-tech weapons systems and offshore wind turbines, while making three-quarters of the planet’s solar panels, according to the paper. If the United States deploys tariffs or sanctions against China’s climate-related technology in a similar manner to how it has tried to combat the Chinese telecommunications company Huawei, then the global fight against climate change will suffer. At the same time, China is an egregious emitter of greenhouse gases and is having difficulty weaning itself off coal, despite its promises to do so. For all developing states, including China and India, the choice between growth fueled by cheap, dirty fuels and more expensive green-energy sources is a challenging one. The United States and European Union will need to use carrots and sticks to get China, other developing countries, and perhaps even some allied advanced economies like Australia to cut back on dirty fuels if the world is to achieve and accelerate its timetable for a carbon-neutral world.

Climate change is too important a global concern to be endangered by Sino-US competition, but it would be naïve to think that neither side will seize on the issue to gain advantage over the other. Some horse-trading between Beijing and Washington will inevitably have to happen if they are to reach their climate goals. Sino-US competition over which country is the global leader in the climate-change fight might even be a good thing as long as the rivalry stays does not swerve into military conflict.

7. A middle-power balancing act against a bipolar world

While the Sino-US relationship looms ever larger over the future of international relations, middle powers have nevertheless found ways to play critical roles (for good or ill) in a world in which power continues to diffuse. Despite the many predictions of its arrival, ours is not a bipolar world—not yet, at least. Even Asian nations that are highly dependent on China economically are hedging their bets, as many expand their security cooperation with the United States. European allies share US concerns about Chinese intellectual-property theft, forced technology transfers, and takeovers of businesses in strategic sectors with sensitive technologies. But they still want to cooperate with Beijing—not just compete—and are opposed to any economic decoupling between the West and China. These Asian and European partners seek to head off a military conflict between the United States and China, which could destroy the global system. They are pursuing their policy agendas independently of Washington and Beijing.

For the United States, this state of affairs has benefits and drawbacks. While Washington can’t assume its allies and partners will automatically fall in line with its agenda, those allies and partners can take the lead on common objectives when the United States becomes preoccupied elsewhere. The European Union and Japan, for instance, sought to keep the flame of free trade alive when the United States disengaged from that effort during the Trump years. In just four years, the EU negotiated major trade deals with Japan and South Korea, reaching additional agreements with Canada, Singapore, Vietnam, and China. Japan’s former Prime Minister Shinzo Abe didn’t let the idea of the Trans-Pacific Partnership idea die when Donald Trump pulled the United States out of the trade agreement, remaking it as the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) in hopes of getting a post-Trump America to join. Japan also joined the Regional Comprehensive Economic Partnership (RCEP). Other major Asian economies, including Australia, New Zealand, and Singapore, signed onto both CPTPP and RCEP.

8. Europe’s quest for strategic autonomy

While “strategic autonomy” has long been a goal for many Europeans, the Trump presidency and the contempt that the former administration showed America’s allies inspired a revival of European interest in being independent—not just from the United States but increasingly from the growing power of China as well. Protecting the European Union’s digital sovereignty by enforcing regulatory standards on foreign tech companies operating in Europe has turned out to be one of the more promising ways for Europe to augment its strategic autonomy. Lacking tech behemoths comparable to those in the United States and China, the EU has aimed to use its power as one of the world’s largest marketplaces to set regulatory standards for the rest of the planet. Brussels has spearheaded data-privacy protocols for the Internet, which have already influenced privacy standards or laws instituted by California and China. It is now trying to establish standards on artificial intelligence (AI). Along with trade deals, these efforts have boosted the EU’s economic weight.

In the military realm, there have been renewed effort to develop a European defense identity alongside NATO. Without major new investments in defense, however, European leaders will still rely on the United States to deter Russia. Yet Europeans can take on more responsibility for other defensive tasks such as policing Europe’s external borders for illegal migratory flows and criminal activity. Like the United States after its exit from Afghanistan, European governments are loath to engage in more nation-building. The reality is that EU member states would be dependent on Washington for intelligence and airlift capabilities even for a medium-scale intervention such as the counterterrorism mission that France is drawing down in the Sahel.

9. An emerging Asia-Pacific hedging strategy

Highly dependent on China as the economic motor for the region, some Asia-Pacific nations see the United States as a critical counterweight against Beijing. For them, Sino-US tensions escalating toward open conflict would be as alarming as a US exit from the region.

China’s aggressiveness in recent years has revived and expanded the focus of the Quadrilateral Security Dialogue, or Quad, involving Australia, India, Japan, and the United States. While experts emphasize that the Quad is not an Asian NATO, US officials believe it can play an important coordinating role in diplomacy; maritime security; supply-chain security; and technology design, development, governance, and use. The Quad, for example, recently set a joint goal of distributing one billion COVID-19 vaccine doses in Asia by the end of 2022. If and when that happens, such a provision of public goods would be hard for China to counter and represent a way for the United States and its partners to project leadership.

Collective efforts like these are necessary at a time when individually Asian countries are no match for Chinese power. That includes India, whose pandemic-pummeled economy, according to the Lowy Institute’s Asia Power Index, is expected to be 13 percent smaller in 2030 than forecast prior to the COVID-19 outbreak—the only Indo-Pacific nation to suffer such a large economic setback. Even though India will eventually surpass China in gross domestic product, due to its still-burgeoning population, that moment is decades away. The Lowy Institute characterizes Japan as “the quintessential smart power” in punching above its weight, but one that is nevertheless in decline. While others—such as Australia, Vietnam, and Taiwan—are gaining in power as measured by the index, none can hope to counter China alone. The United States still ranks as the preeminent power in the region but “registered the largest fall in relative power of any Indo–Pacific country in 2020,” according to the Lowy Institute.

In an atmosphere in which neither of the superpowers has (yet) prevailed, the region’s middle powers are better able to exert influence. While many Asian powers now appear more intent than they were in the past on countering an aggressive China, they worry that the United States will take an overly militarized approach to the endeavor. These nations would be apt to restrain Washington if the contest with Beijing heated up and risked breaking into open conflict.

10. The growing internationalization of conflict 

The risk of conflict extends beyond growing Sino-US tensions. In today’s multipolar order, governments see battlefields as fertile grounds to shape balances of power, advance their economic agendas, or aid parties to the conflict that are more aligned with their national-security interests. Turkey, Russia, and Iran, for instance, are jockeying for expanded influence in such conflicts. In part because of this internationalization of intrastate conflicts, fighting is increasingly protracted, intense, and complex, to the detriment of civilians.

Battlefields are less traditional too. Since 2005, thirty-four states are believed to have sponsored cyber operations, with China, Russia, Iran, and North Korea thought to have instigated 77 percent of all suspected efforts. States can use cyberattacks both as an asymmetric tool to reduce a power imbalance in conventional military capabilities (e.g., North Korea), and as a symmetric one integrated across the entire spectrum of operations and domains (e.g., China). Whereas cyberattacks were previously mostly isolated incidents meant to disrupt particular systems, they are increasingly becoming a strategic tool. For example, the United States used offensive cyber operations to strike ISIS forces responsible for proselytizing, recruiting, and launching attacks.

Looking ahead, experts and policymakers alike are concerned that emerging technologies such as AI, biotechnology, and 5G, or new systems such as the Internet of Things (IoT) or cloud computing, will exacerbate Internet insecurity by revealing new vulnerabilities and providing additional tools to nefarious actors. For example, an Atlantic Council report considering alternative cyber futures mapped three potential universes: one in which cyber capabilities are mainstreamed and great-power competitors have the advantage; another in which the Internet is splintered across governmental, cultural, and business lines; and yet another in which new technologies such as AI lead to an arms race and generalized insecurity.

Three alternative worlds in 2030

Mathew Burrows is the director of Foresight at the Scowcroft Strategy Initiative and the co-director of the New American Engagement Initiative within the Atlantic Council’s Scowcroft Center for Strategy and Security.

Anca Agachi is an associate director at the Transatlantic Security Initiative within the Scowcroft Center for Strategy and Security.

The post Welcome to 2030: Three visions of what the world could look like in ten years appeared first on Atlantic Council.

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Six ‘snow leopards’ to watch for in 2022 https://www.atlanticcouncil.org/content-series/atlantic-council-strategy-paper-series/six-snow-leopards-to-watch-for-in-2022/ Tue, 21 Dec 2021 05:00:00 +0000 https://www.atlanticcouncil.org/?p=464133 Because it receives little attention in the press, the snow leopard does not appear significant enough to warrant much scrutiny as a driver of change and shaper of the future. Yet just like the real cat in the wild, the figurative snow leopard is something that could sneak up and vividly remind us that it exists.

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Six ‘snow leopards’ to watch for in 2022

By Peter Engelke

It’s one of the rarest animals on earth. Nicknamed the “ghost of the mountains,” the legendary snow leopard lives at high altitudes in Central Asia. The solitary existence, elusive disposition, and near-perfect camouflage of these beautiful cats make them a rare sighting even for locals and wildlife biologists who are trained to find them. Since it is most often out of sight and therefore out of mind, the snow leopard is the kind of animal that might be forgotten—until it suddenly appears as if out of nowhere.

In the world of global foresight, which is my area of focus at the Atlantic Council, I think of a “snow leopard” as a known but underappreciated—perhaps even forgotten—phenomenon. Because it receives little attention in the press, the snow leopard does not appear significant enough to warrant much scrutiny as a driver of change and shaper of the future. Yet just like the real cat in the wild, the figurative snow leopard is something that could sneak up and vividly remind us that it exists. 

The snow leopard is distinct from two other concepts in global foresight. First, it is unlike the “black swan,” which is an extreme event with no historical precedent. In contrast to the black swan, the snow leopard does not have to be a single discrete event at all. And although both the snow leopard and the black swan arrive on the scene with great impact, the snow leopard’s arrival is preceded by plenty of information— if we look hard enough—suggesting that it might be just around the corner. Second, the snow leopard overlaps with the concept of “weak signals,” often defined as the early signs of a trend that could alter the future. But it extends beyond early emergent signs to include long-underestimated phenomena. 

Consider technological disruption, which we frequently envision as a thunderbolt event but more often unfolds as a gradual, under-the-radar process. Rather than occurring at lightning speed immediately after a technology is invented, disruptive impact tends to become evident during the scaling phase that follows a long, less visible gestation period of testing and experimentation. The COVID-19 vaccines are the exception that proves the rule. They astonished the world for good reason, given the stark contrast between the fast pace of their development under emergency conditions and the typically slow development of other vaccines. Even so, the messenger RNA laboratory research that formed the scientific basis for these vaccines goes back more than thirty years. 

The intermodal shipping container, a key enabler of the modern global economy, is a good example of a snow leopard. Invented in 1956, the standardized shipping container took more than a decade to prove its worth in terms of dramatically speeding up transshipment processes compared with previous methods and hence significantly lowering costs. It took even longer for this technology to find global scale via the now-ubiquitous complex of specially modified ships, ports, cranes, tractor trailers, and railway cars that have given the container its transformative economic power. The humble shipping container drove the late-twentieth century globalization wave, upending economic sectors and even entire national economies. Barely noticed while it was happening, containerization became one of the most important technologically based disruptions of the past century.

So what snow leopards should you keep your eyes peeled for in 2022 and beyond? Check out my list of six to watch closely in the year ahead.

1. The true leaders of the climate fight: cities

Although the recent COP26 conference in Glasgow, Scotland, staged by the United Nations Framework Convention on Climate Change (UNFCCC), produced some promising carbon-reduction pledges, none were binding on the countries that made the commitments. But the conference also underscored that a vanguard of climate-conscious governments—subnational governments, to be precise—are taking decisive action. For well over a decade, the world’s largest cities have been organizing to confront a problem that they are particularly vulnerable to, even as they have largely created it (cities account for roughly 70 percent of global carbon emissions). Cities and city associations (C40 Cities is the best-known association) have been among the most consistently vocal and visible actors at the various COP conferences in calling for stringent emissions reductions. Such demands are neither hollow nor hypocritical. The same cities that are demanding bold UNFCCC actions have been busy banning gas- and diesel-powered vehicles from city centers, creating zero-emission bus fleets, crafting green building codes to regulate the carbon that is embodied in the materials used to make buildings (concrete, steel, glass, etc.), building partnerships with major corporations to reduce carbon emissions, and otherwise engaging in the hard work of resilience-focused climate adaptation. In so doing, city governments have positioned themselves at the innovative cutting edge on climate, seeing opportunity rather than heartache in the transition to a zero-carbon world. National governments will always have a critical role to play in countering climate change, but while they receive the most attention they are actually behind the curve.

2. The arrival of harmless mosquitos

In May 2021, the biotech firm Oxitec released genetically engineered mosquitos into the Florida Keys ecosystem—the first experiment of its kind in the United States. It was the latest attempt to genetically engineer mosquitos to prevent or at least reduce the incidence of mosquito-borne diseases, which include some of the deadliest diseases on earth: malaria, Zika, the West Nile virus, dengue, and yellow fever, to name only a few. Oxitec’s method (which is far from the only methodology under development) focuses on reducing the mosquito’s ability to reproduce itself, with each generation yielding fewer female mosquitos (females bite humans, males do not). After decades of laboratory research, the genetic manipulation of mosquitos is now starting to be scaled. And regulators are taking serious notice. In May 2021, the World Health Organization (WHO) issued new guidance for research to “ensure that the study and evaluation of genetically modified mosquitoes as public health tools is safe, ethical and rigorous.” As the WHO cautions, there are real risks involved in genetic engineering—in this case involving both human health and broader impacts on other species and natural ecosystems. Nonetheless, the hope remains that a new and (tentatively) promising era of communicable disease control might be in the offing. 

3. The global, grassroots expansion of innovation

For decades, Silicon Valley has been at the top of a global tech-innovation pyramid dominated by cities and regions in rich countries. But the base of that pyramid has been growing to encompass more places in more countries around the world. Various governments from Kenya to Egypt to Vietnam have been supporting their fledgling tech-startup ecosystems, in some cases for years and more than occasionally with real success. Just as important has been grassroots entrepreneurialism enabled by the Internet, mobile phones, digital service platforms, and a widespread “maker” outlook. Across the Global South, these entrepreneurs—often women and youth—have created tech-based innovations to address local needs ranging from quick access to micro-scale financing to bespoke material products (“makers” are those interested in manufacturing their own material inventions using tools that they acquire and make themselves). In the process, they have helped build and expand startup ecosystems in cities ranging from Accra, Ghana to Amman, Jordan—places where governments have wisely encouraged such activity via support and investment. Venture capitalists now comb the world looking for investment opportunities, as Silicon Valley tech firms build digital platforms to assist grassroots startups in far-flung locations. Most importantly, governments, firms, and individuals the world over have come to understand that there is a recipe for uncorking their own innovative potential and, in so doing, joining the ranks of the world’s wealthier countries. All this is a positive development, with more people in more places using tech-based skills and tools to create economic and social opportunity and, in the process, build wealth and reduce poverty.   

4. The dawn of lab meat

It’s not just the stuff of science fiction. Lab meat, not to be confused with plant-based meat substitutes, is grown in huge steel bioreactors using a small number of stem cells taken from a real living animal—a cow, fish, chicken, pig, etc. The result is honest-to-goodness meat, genetically identical to animal meat, albeit grown without the animal itself involved. First introduced to the world a decade ago as a proof of concept (and one that cost exorbitant sums of money), lab meat has since undergone a great deal of study and refinement, not to mention cost reduction. With billions of dollars in venture-capital investment behind it, the nascent industry stands on the cusp of commercial scaling. Why does lab meat matter? Because it has real potential to upend several of the biggest and most important industries in the world: livestock, aquaculture, and commercial fishing. By separating meat production from animal harvesting, lab meat would have enormous impact on land and freshwater use, wildlife, and carbon emissions, in addition to the potentially significant benefits to animal welfare and public health. (Since lab meat is grown in sterile conditions, for example, there is no need for the antibiotics that are used on farms.) Beef, chicken, and fish variants of lab meat now exist, as do factories in Singapore and the United States that are ready to produce tons of product. All that stands in the way of lab meat becoming mainstream is reducing cost a bit more, winning over skeptical consumers, and gaining regulatory approval. Admittedly, all are real hurdles, but few in the industry believe any are insurmountable.

5. The fierce resurgence of environmentalism

The history of environmentalism has been marked by long stretches of professional dialogue and elite-centric policy focus punctuated by waves of high-visibility public activism. Environmentalism’s most famous and consequential episode of public activism occurred in the late 1960s and early 1970s, during a period that also featured the antiwar and (in the United States) civil-rights movements. Now, in the twenty-first century, there is good reason to expect the resurrection of a mass global environmental movement. Growing popular worry about climate change and its ever more obvious impacts, combined with the slow pace and limited ambition of governmental responses, provide the backdrop for rising fear and frustration. In this climate, the Swedish teenager Greta Thunberg sparked a global youth protest wave through her simple acts of individual demonstration. Other signs of the coming global movement have darker overtones. Extinction Rebellion, a global climate-action network based in the United Kingdom, sees itself as fighting a last-ditch battle for all of humankind. Such phenomena increasingly reflect the Zeitgeist of our times. Findings from a 2021 survey of 10,000 youth across ten countries found that the clear majority (nearly 60 percent) said they were “extremely” or “very” worried about climate change. Lest the jaded reader think that the worriers are spoiled rich kids living in rich places, consider that the countries with the highest percentages of young people expressing such concerns were the Philippines (84 percent), India (68 percent), and Brazil (67 percent). The 2020s are ripe for an uprising.

6. The specter of hunger-driven conflict

In 2020, after many years of decline or at least stasis in their ranks, the number of hungry people in the world spiked by an estimated 118 million to 161 million. The culprit? The global economic downturn caused by the COVID-19 pandemic. Although the pandemic by itself is unlikely to have a permanent impact on global hunger, this episode points toward chronic vulnerability, especially for the world’s poor, regarding the most fundamental of all goods: food. In the decades to come, that vulnerability could get much worse because of a likely squeeze on global food availability. Climate change is set to reduce crop yields even as growing wealth and population increase global demand for food. For the world’s poorest people living in the most climatologically fragile countries, these intersecting trends could produce a nightmare of hunger, desperation, and conflict that could spill over borders and threaten entire regions. The encouraging news is that there are real countermeasures—including public and private investments, on-site planting and harvesting methods, and innovative approaches to soil and forest management—that can make local food systems more just, productive, climate-resilient, and ecologically sound. None of these solutions will be easy to implement. But the first step in addressing a snow leopard is recognizing that it exists.

Peter Engelke is the deputy director and senior fellow for foresight at the Scowcroft Strategy Initiative within the Scowcroft Center for Strategy and Security.

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The top twelve risks and opportunities for 2022 https://www.atlanticcouncil.org/content-series/atlantic-council-strategy-paper-series/the-top-twelve-risks-and-opportunities-for-2022/ Tue, 21 Dec 2021 05:00:00 +0000 https://www.atlanticcouncil.org/?p=466204 With ongoing vaccination challenges in much of the world and the worrying emergence of the Omicron variant, along with supply bottlenecks plus rising inflation and debt, the pandemic continues to exert its relentless push and pull on a beleaguered world.

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The top twelve risks and opportunities for 2022

By Mathew Burrows and Robert A. Manning

It’s been more tug-of-war than clean break, but 2021 will mark the year rich countries began extricating themselves from the COVID-19 crisis. With ongoing vaccination challenges in much of the world and the worrying emergence of the Omicron variant, along with supply bottlenecks plus rising inflation and debt, the pandemic continues to exert its relentless push and pull on a beleaguered world. All the while the formidable geopolitical problems that world was wrestling with pre-COVID—from spiraling tensions between the West and China and Russia to the dearth of international action to counteract climate change—haven’t gone away. Just the opposite.

So what will 2022 bring?

Drawing on our many years of experience in forecasting global trends and developments at the US National Intelligence Council, where we were tasked with providing US leaders with long-range analysis and insight, we have identified the top twelve risks and opportunities in 2022 for the world from a US perspective. (Note also what doesn’t appear in these lists; potential crises over Taiwan’s status or North Korea’s nuclear weapons could be catastrophic, but in our judgment these long-simmering issues are unlikely to come to a boil in 2022.) We’ve ordered the scenarios by importance and assigned each a probability; “medium” means a 50/50 chance that the scenario will occur within the next year.  

Top risks

The lack of COVID-19 vaccination in developing countries triggers new variants that are potentially more contagious and lethal

Although a small majority of the world’s population has now gotten at least one dose of a COVID-19 vaccine, some regions are in far better shape than others; in Africa, for example, just 12 percent of the population had received at least one dose as of December. Developed countries have largely failed to protect their weaker and poorer counterparts. The COVAX global vaccine coalition, for instance, has distributed just 400 million doses, far short of an initial 2021 goal of 1.9 billion. At the current rate, African populations won’t be largely vaccinated until sometime in 2023 or later, which likely will lead to lower economic growth and political instability. Besides reflecting shamefully on the West’s humanitarian values, the large numbers of unvaccinated could prove highly dangerous for Western citizens. The Delta variant, first detected in India and far more contagious than past strains, quickly spread worldwide, overwhelming hospitals in rich countries and even breaching the defenses of those already vaccinated. The Omicron variant, which was first identified in southern Africa, now appears much more contagious than Delta, although its severity has yet to be fully determined. The longer much of the global population remains unvaccinated, the greater the chance of virus mutations that produce more contagious, severe, or vaccine-evasive variants. Even if vaccination coverage greatly increases, many experts believe we should be prepared to live with an endemic threat from COVID-19.  

Probability:

Russia attacks Ukraine

Russia’s large military buildup near its border with Ukraine has heightened concerns that Russian President Vladimir Putin sees in his neighbor “unfinished business.” Putin has written that Ukraine is not a true nation and that “Russians and Ukrainians were one people—a single whole.” If Putin, who seems increasingly mindful of shaping his legacy, were to act on such instincts, he has a spectrum of options for weakening Ukraine and thus keeping the country in Russia’s sphere of influence and as a dependable buffer against NATO. Ramped-up US/NATO political and military support for Ukraine or a near-confrontation in the Black Sea between Russian and NATO forces may tempt Putin to call the West’s bluff. Some observers argue that Russian fears of potential retaliatory measures—such as the cancellation of the Russian Nord Stream 2 gas pipeline to Germany, US sanctions against Russian banks or the secondary market for Russian debt, and increased NATO deployments to neighboring NATO states—would deter Russian military aggression. But in Putin’s mind passion to avenge what he sees as US betrayal through NATO expansion in the former Soviet space may override the likely costs of an intervention. In escalating severity, possible Russian intervention scenarios include: 

  • military threats or aggression to press for negotiated reductions of US/NATO military support for Ukraine and talks on other issues of contention
  • military and economic coercion (taking advantage of Europe’s dependence on Russian gas, for instance) to forcibly implement the Russian interpretation of the Minsk agreements, including a Ukraine that remains neutral between East and West and some degree of autonomy for the Donbas region in a federated Ukraine;
  • and a full-scale Russian military invasion to seize control of Ukraine and/or put in place a Russia-friendly government.

Probability:

As China peaks, its economy sputters—sparking global disruptions

For all the fear of a rising China, its weakness may pose the greatest risk. President Xi Jinping’s crackdown first on the tech sector and now on the property sector, which accounts for some 29 percent of China’s economy, highlights the fragility of the country’s economic system. The concern is that energy shortages, demographic decline, declining growth and productivity, and debt (exemplified lately by the beleaguered property giant Evergrande but running much deeper in a country saddled with total debt that is 290 percent of its gross domestic product) reflect an outdated economic model. Yet Xi may see needed market reforms promised in 2013, but then rejected, as too difficult politically to implement. Instead, the Chinese Communist Party (CCP) has opted for bolstering state-owned enterprises and control of the private sector—despite private firms serving as a major source of growth and innovation in the past. Some national-security analysts fear that Xi may compensate for lower growth with a more aggressive military policy toward Taiwan and beyond in order to shore up the CCP’s nationalist legitimacy. But an economically struggling China could also unravel global stability: China has driven some 30 percent of global growth for the past decade. As well as being more confrontational, a weak China could thus tank economic growth around the world, while disrupting financial markets and supply chains. The attendant lost wealth and jobs could spark unrest and/or intra-party turmoil in China as well.

Probability:

Afghanistan collapses, and the United States can’t escape its consequences

Afghanistan is enduring an unprecedented humanitarian crisis, and possible state collapse looms in 2022. According to the United Nations’ World Food Program (WFP), 23 million Afghans faced imminent starvation before the winter—forecast to be severe—even began. It is difficult for the World Bank and other development agencies to directly assist Afghans due to the country’s chaotic payments system and international prohibitions on aiding the Taliban. The United Nations warns that Afghanistan’s banking system may be nearing collapse, endangering humanitarian-relief efforts. The Afghan economy (except the drug trade) is at a standstill, after the US exit cut off some $8.5 billion a year (40 percent of the country’s gross domestic product) and the International Monetary Fund froze some $9 billion in foreign assets. The Taliban is contending with rival jihadist groups such as the Islamic State, raising the risks of increased terrorist activity around the world—including possible attacks against US interests as well as those of Russia and China. According to the United Nations, there are now at least 2.6 million Afghan refugees—mostly in Iran and Pakistan—and another 3.5 million internally displaced people, and the worsening situation in the country could propel more refugees to Europe.

Probability:

Developing countries suffer more severe economic troubles and a rash of political instability

The second-biggest casualty from COVID-19—after the more than five million people who have died from it—is the global middle class. The Pew Research Center estimates that the pandemic-induced recession left 131 million more people in poverty. Even those who have managed to hang on to the middle class in the developing world are poised to confront spiraling economic insecurity due to the political and economic aftershocks of the pandemic, which will continue to range for some time in many of these countries. India, which has shed 32 percent of its middle and upper-middle classes combined, could finish 2021 with a gross domestic product that’s 5.2 percent smaller than it would have been without the pandemic. Rising inflation in the United States and Europe threatens to further destabilize economies in the developing world at a time when they need to recapture lost growth. If the Federal Reserve and European Central Bank raise interest rates to counter inflation, past patterns suggest that capital will swiftly leave poorer countries for higher returns with less risk in richer countries. These countries would then face a Catch-22: As the economists Rabah Arezki and Jean-Pierre Landau wrote for Project Syndicate, “Policymakers can either let their currencies depreciate, which would fuel inflation, or hike interest rates, which would adversely affect growth and debt sustainability.” The international community will need to inject funds into poorer countries to stabilize their currencies and help them navigate a dangerous period. Without such help, political instability will gather momentum, bringing down several governments. 

Probability:

Oil tops $100 per barrel

Predicting boom/bust cycles in the oil market is always hazardous. There are conflicting forecasts, with the US Energy Information Agency foreseeing a drop from a price of eighty-four dollars per barrel of Brent crude oil this fall to sixty-six dollars per barrel by this time next year, while many private-sector analysts and hedge funds are betting on a prolonged price spike. The proximate causes of the current price increase are the 2021 surge in demand after a pandemic-driven drop, limited production hikes by the Organization of the Petroleum Exporting Countries (OPEC), and the effects of several years of declining investment in oil and gas. An insightful recent study highlights new risks posed by longer-term structural changes in the energy industry—from inflation, recession, and debt defaults to energy-security concerns—as OPEC and Russian state-owned oil firms dominate investment and production, and thus the geopolitics of oil, amid a protracted global transition to clean energy.

Probability:

The world fails to meet its climate goals from the inconclusive Glasgow summit

Global carbon emissions have grown by 60 percent since the Kyoto Protocol was signed in 1997, and the climate-change accord from this year’s twenty-sixth UN Conference of the Parties (COP26) in Glasgow doesn’t assuage concerns about the risks of accelerated climate change or the likelihood of achieving the goal of curbing average temperature rise to less than 2 degrees Celsius above pre-industrial levels. Prior to COP26, if all pledges from the 2015 Paris climate deal had been met (few were), global temperatures were still projected to rise 2.7 degrees Celsius by 2100. World leaders projected a new seriousness at COP26, with its final agreement calling for the “phasing down” of coal and separate agreements aiming to slash deforestation and methane emissions, establish global rules for carbon trading, and foster US-China climate cooperation. Despite this progress, the pledges were all characteristically vague. The International Energy Agency has issued a detailed roadmap for reaching net-zero emissions by 2050, which will require an end to new oil and gas projects by next year—along with a tripling of investment in solar and wind energy to $4 trillion and a quadrupling of investment in smart grids by the end of this decade. Such progress is technically possible, but politically highly improbable absent dramatic new action well beyond what was agreed to at COP26.

Probability:

A bifurcated world emerges, but it’s not a repeat of the Cold War with the Soviets

Washington has fallen in love with the idea of re-running the Cold War, undoubtedly with the same ending of the West triumphing. Some focus on what’s different between the economically anemic Soviet Union and today’s omnipresent China—a top economy and major high-tech innovator, along with its status as the world’s number-one trading power and capital exporter—should cause the Beltway to rethink the merits of a bifurcated world. The Chinese economy has grown so interdependent with US and Western economies that all would suffer in such a world. China was America’s largest trading partner for goods last year, at $559.2 billion, and Wall Street is also getting in on the action, with BlackRock raising one billion dollars in September for China’s first foreign-run mutual fund. 

Meanwhile, Chinese leaders are frantically trying to de-Americanize China’s supply chains. China’s biggest vulnerability is its lack of a high-tech chip industry. But since cutting US supplies would hurt American manufacturing, the Biden administration has been hesitant to hit Beijing there. Should the gloves come off—as some in Washington advocate—it’s unlikely that China will be brought to its knees. What could instead result is a bifurcated world where we are all poorer and more prone to conflict. US businesses would miss out on new opportunities in China and perhaps elsewhere in Asia. The division would also come in the form of digital blocs, producing a race to the bottom and different standards concerning robotics, quantum computing, artificial intelligence (AI), and bioscience (such as CRISPR gene editing). The notion that Europe would follow the United States down this road is dubious given the dependence of Germany and others on trade with China, twined with the European Union (EU)’s preference for using regulation to address Chinese practices it disagrees with rather than decoupling economically from China. In a Cold War with China, happy endings are far from guaranteed.  

Probability:

Food insecurity worsens, propelled by COVID-19, climate change, and conflict

As we warned last year, a combination of the pandemic, extreme weather, and violent conflict is stoking food insecurity. Fifteen million more people are now at risk of starvation relative to before the pandemic started in 2019, according to the World Food Program. In November, the WFP warned that forty-five million people are on the brink of famine across forty-three countries, with higher food and transportation costs straining the budgets of families and aid organizations alike. One of the main drivers of this year’s increase has been the humanitarian catastrophe in Afghanistan, which is now home to the world’s worst food crisis. Over the next decade, the World Bank has said that food systems need a $300-350 billion per year “transformation” to reduce greenhouse-gas emissions and protect the environment while also feeding a world population set to grow to ten billion by 2050.  

Probability:

More countries slip from their current fragile state into failure

The countries at the top of each year’s Fund for Peace Fragile States Index rarely change. Yemen, Somalia, and Syria (in that order) reappeared again on its 2021 list under “very high alert,” and many would argue that they have tipped over into state failure. Even some of the countries in the next tier of “high alert” are close to if not already experiencing state failure: South Sudan, Democratic Republic of Congo, Central African Republic, Chad, Sudan, and Afghanistan. Worryingly, such large countries as Ethiopia and Nigeria are not too far behind—and their collapse would trigger major regional convulsions. It’s clear that the underlying conditions that we know cause state failure are worsening and metastasizing in these countries. Propelled by increasing drought and water scarcity, a food crisis (see above) is spreading; without vast investment in more capable food systems, we should expect such crises to occur well beyond the highest-alert countries. Armed conflicts are also becoming increasingly protracted, intense, complex, and dangerous to civilians. COVID-19 is an added burden, increasing the poverty rate in many poorer countries and pushing debt to record levels. It’s easy to become inured to doomsaying, but in 2022 the dismal outlook looks warranted.    

Probability:

Western efforts to revive the Iran nuclear agreement fail

The Iranian government has issued escalating demands for the United States to ease sanctions and grant assurances prior to Tehran assenting to a new deal to curb its nuclear program, even as the regime increases its nuclear-enrichment efforts. Israeli cyberattacks on Iranian nuclear facilities—and Iran’s response to those activities—are escalating. Congressional pressure is building on President Joe Biden to impose tougher sanctions on Iran and to take action against Iranian sanctions-breaking activities such as oil sales to China. Military action against Iran’s nuclear program by the United States or Israel cannot be ruled out. Iran, meanwhile, has the ability to conduct drone and missile attacks against Gulf oil facilities and US military bases—and to use Hezbollah or other surrogates to engage in a shadow war with Israel. If tensions deepen, there’s always the chance that miscalculations or inadvertent clashes lead to a major military confrontation with Iran. 

Probability:

US democracy further decays

The coming year is shaping up to be one in which American democracy erodes significantly. Freedom House’s 2021 report, which documented a global democratic retreat, highlighted an 11-point decline in its freedom score for the United States over the past decade—putting the country among the roughly two dozen nations with the steepest declines over that period. The organization cited the January 6 attack on the US Capitol, which sought to overturn the 2020 presidential election based on false claims of election fraud that are still promoted by ex-President Donald Trump and have been adopted by much of the Republican Party. Polls suggest that some 70 percent of Republican voters, and 30 percent of voters overall, believe that Biden was not legitimately elected, despite all evidence to the contrary. As social-media-borne disinformation and conspiracy theories abound, the country’s political divide appears to be widening ahead of the 2022 elections—with each side seeing the other not as opponents but as enemies. An alarming number of Americans now view violence as acceptable, including nearly a third of Republicans. Gerrymandering and new election laws in at least nineteen states, some empowering more partisan state legislatures rather than state election officials to determine election results, could tilt outcomes. With the GOP positioned to retake the House and possibly the Senate in 2022, America’s polarization and sectarian tensions look poised to only increase.

Probability:

Top opportunities

World Trade Organization members make needed reforms

If the Biden administration wants to make good on its rhetoric about upholding an inclusive, rules-based international order, halting economic fragmentation and COVID-fueled protectionism should be a priority. That requires fixing a broken World Trade Organization (WTO), which governs as much as 80 percent of global trade. Absent the WTO setting rules that allow nations to raise concerns and settle their disputes, the world would drift toward trade restrictions and regional blocs dictated by major economic powers. In a well-received recent speech, US Trade Representative Katherine Tai issued sharp criticisms of the WTO but pledged a US commitment to reforming it. Such reforms are necessary and doable, starting with a reinvented dispute-settlement mechanism that avoids litigation and boasts an effective oversight board. They should also include transparency on subsidies, new digital-commerce rules, a greater role for climate and labor rights, and trade liberalization focused on specific sectors. 

Probability:

Researchers develop a universal vaccine against all coronaviruses

By now, most of us have realized that SARS-CoV-2 is not going away anytime soon. Heading into the third year of living with the virus, we’re seeing more waves of infections even in areas where there are relatively high vaccination rates—along with a highly concerning new variant, Omicron. Then there are the hundreds of other COVID-type viruses of varying strength in existence, a small minority of which could prove deadly. New research suggests that other animals besides bats could be carriers of SARS-like coronaviruses. We need a universal vaccine against all coronaviruses, including SARS-CoV-2 variants present and future, and some promising research along these lines is already underway. Scientists at the University of North Carolina’s Gillings School of Global Public Health, for example, have been working on just such a vaccine and seen encouraging results with mice. Their approach is similar to that of the Pfizer and Moderna vaccines, except they merge mRNA from several coronaviruses. Many other scientists are engaged in parallel efforts. All of this could yield the key to containing the next outbreak. The US government should make this research a national priority and scale it so everyone in the world can benefit from the results.  

Probability:

World powers cooperate on new AI standards and regulations

AI applications—from facial recognition to employment screening— are increasingly being deployed across industries and will become ubiquitous during this decade. Yet there are few agreed-upon global rules or standards in this realm. Though AI is a technology dominated by the United States and China, the European Union is seeking to create a regulatory framework that can establish such standards. A draft Artificial Intelligence Act before the EU Parliament and European Commission sets detailed strictures for AI use and commerce based on a hierarchy of risks (with job recruitment, critical infrastructure, and law enforcement among those identified as high-risk). While there is widespread overlap in declarations on AI ethics by the United States, the EU, Japan, and China, common ethical values have not been put into operation. The EU’s initiative should spur the United States to forge global AI norms. The new US-EU Trade and Technology Council should prioritize building a transatlantic consensus on these issues, which can lay the groundwork for a broader agreement among the Group of Twenty (G20) nations. 

Probability:

The United States and the European Union forge a transatlantic approach to digital regulation

The EU is beginning to define its concept of “tech sovereignty” as a means of making the union more competitive. A package of pending legislation mainly targets large US tech firms that the EU sees as “gatekeepers” in setting the terms of data commerce. This regulatory approach would rein in US companies and change their business models, widening the transatlantic gap on tech regulation. The US Congress should see the EU’s ambitions as an opportunity to move on the United States’ own digital regulations while the Biden administration should prioritize efforts to find common ground with the EU on digital matters. A US-EU consensus would create leverage for establishing global standards on these issues. 

Probability:

The United States helps avoid another Ukraine crisis

The growing crisis triggered by Russia’s threatening troop movements against Ukraine should be turned into an opportunity to put relations between Russia and the United States on steadier ground. One step to slow the current momentum toward a dangerous confrontation would be for the United States and European Union to broker talks designed to get Moscow and Kyiv to adhere to an updated Minsk II framework. The United States should not assume that increasing sanctions on Russia or arms shipments to Ukraine will deter Putin; just as likely, they will goad him into making further incursions against his neighbor before it becomes too costly for him to do so. The conflict in Ukraine can no longer be set aside in Biden’s efforts to stabilize the US-Russia relationship by establishing red lines on cyber warfare and other strategic issues. If Washington finds ways to finally lower tensions over Ukraine, it could open up more opportunities to reduce friction with Moscow—at a time when the United States would rather focus on China.  

Probability:

China and the United States reach a détente

Though media reports portrayed the Biden-Xi summit as merely more words, the nearly four-hour meeting in November appeared to signal a recognition by both leaders that relations between the two superpowers are spinning out of control and toward conflict—at a time when Biden and Xi must also focus on difficult domestic agendas. The summit, as Biden said, was intended to put in place “guardrails” to reduce risk and incrementally create a framework for managing a competitive coexistence between the countries. The two leaders, in effect, set a mandate from the top to their respective senior officials and bureaucracies to unwind the building confrontation and work through the thorny differences that brought them to the brink. In response, the US and Chinese governments restored senior-level military-to-military talks. Perhaps most importantly in light of Beijing’s buildup of its nuclear-weapons arsenal, Xi seemed to reverse China’s stance for more than a decade by moving toward engaging in a nuclear-arms dialogue with the United States—reflecting the fact that new mutual vulnerabilities with regard to nuclear weapons could motivate the two countries to establish new guardrails. Possible areas for cooperation include shared interests related to trade, climate change, and energy security along with addressing the challenges posed by instability in Afghanistan and the nuclear programs of Iran and North Korea. It remains unclear whether the US-China relationship will reach a new normal or revert to the downward spiral of distrust characteristic of recent years. But there is now at least an opportunity to test each other’s intentions.

Probability:

The United States launches an Asia-Pacific digital-trade accord

US Indo-Pacific strategy has a gaping hole on trade. The United States should plug it with a big opportunity: fast-growing digital commerce, which accounted for 17 percent of global retail trade in 2020. There is a compelling case for a regional agreement that builds on high-quality digital-trade language in the US-Mexico-Canada Agreement, the US-Japan Digital Trade Agreement, and the Trans-Pacific Partnership (before the United States withdrew from the pact). A new type of accord—akin to the Singapore-New Zealand-Chile Digital Economy Partnership Agreement (DEPA), which some officials in the Biden administration see as a model—could pioneer a more inclusive worker- and small business-friendly approach. DEPA takes that tack with provisions on e-invoicing, express shipments, interoperable fintech (e-payments), trusted networks, and AI cooperation. And it’s modular, permitting nations to accede to only parts of the agreement.

Probability:

The world seizes low-hanging fruit on climate change

The COP26 final statement fell short of putting the planet on a path to limit global warming to less than 2 degrees Celsius. But stopping deforestation, slashing methane emissions by 30 percent, and establishing global carbon-trading rules could all have significant payoffs in greenhouse-gas reductions if those pledges from the climate conference are actually implemented over the next decade. The US-China climate accord also announced in Glasgow could help accelerate those goals by, for example, contributing to a push for a 50 percent methane reduction by 2030. Ramping up US natural-gas exports to China, the world’s largest coal consumer, would be the fastest way to phase down growing Chinese coal use. Another useful step would be to add enforcement provisions to the carbon-trading rules delineated at COP26. The G20 could flesh out the conference’s vague deforestation pledge by encouraging nations to plant one billion trees by 2025 with the assistance of public-private partnerships. Governments could give farmers credits for improving their land to better capture carbon. The bipartisan infrastructure law recently signed by Biden will retrofit buildings to make them more energy efficient, fund hundreds of thousands of electric-vehicle charging stations, and invest billions of dollars in smart grids so that utilities make more use of renewable energy, while the Build Back Better legislation, whose passage is now in doubt, devotes half a trillion dollars to fighting climate change. These initiatives don’t amount to the big-bang climate solutions that many hoped would come out of COP26. But they’re not nothing either.

Probability:

The United State, China, and Russia start cooperating in space

On November 15, Russia fired a missile to destroy one of its satellites and created more than 1,500 traceable pieces of debris in low-earth orbit, forcing crew members of the International Space Station to take shelter in their spacecrafts in case the station was hit. Moscow claims the missile test was needed because of US plans to upgrade its strategic missile-defense systems. The United States, China, and Russia have all added debris to space over the years, and they increasingly see space as a key domain for military competition. Hundreds of thousands of pieces of debris are now hurtling through space at around 15,500 miles an hour, threatening human space flight and the nearly five thousand active satellites in orbit. Our tech-dependent way of life would be imperiled if communications satellites are disabled, and the dangers are only increasing: By one estimate, there could be one hundred thousand satellites in orbit by 2030. No international system of space-traffic control exists, and there is no independent global body providing data on satellite positioning and trajectories. A good first step would be for the United States, China, and Russia to reach some understandings on their moon missions. The Russians have rejected an invitation to join the NASA-led Artemis project, citing the “departure of our American partners from the principles of cooperation and mutual support,” and are instead joining with the Chinese to create a competing International Lunar Research Station. While it might be too late for all three powers to cooperate on a single lunar initiative, they could derive mutual benefit from sharing their plans and the results of their explorations. 

Probability:

The United States takes the lead in responding to an ailing Latin America

Latin America has been hit especially hard by COVID-19. The middle class there could lose its foothold and, in a repeat of the 1920s and 1930s in Europe, turn away from democracy as a result of impoverishment. In response, the Biden administration must do more than just increase foreign aid to the region to stop migrant flows. A Bill Clinton-style Free Trade Area of the Americas is likely a bridge too far given the aversion of the Biden administration and Congress to large-scale regional trade agreements. But the United States can still play an active role in fostering debt relief, assisting with climate-change adaptation and mitigation, building up an existing high-tech base, and nurturing greater regional cohesion. While increasingly focused on China and Asia, the United States can’t afford to ignore its own region, particularly since many of the day-to-day issues Americans worry about—immigration, the drug trade, climate change (via the destruction of the Amazon rainforest)—have their roots there. Next year’s Summit of the Americas is an opportunity for the Biden administration to clarify America’s commitment to its neighbors. 

Probability:

Congress strikes an immigration-reform deal

There’s an immigration deal to be had if Republicans and Democrats can get beyond their dug-in positions and move toward a reform package that balances the Republican goal of a more secure border with the Democratic desire for citizenship for the eleven million undocumented immigrants estimated to be in the United States. The last major bipartisan reform effort in 2013 garnered sixty-eight votes in the Senate and would have fulfilled both objectives along with updating immigration criteria to attract more high-skilled immigrants, but House Republican leaders never gave it a vote. The Build Back Better legislation recently passed by House Democrats provides work authorization—but not citizenship—for up to ten years to an estimated 6.5 million undocumented workers who have lived in the United States since 2011 and prevents the expiration of hundreds of thousands of unused visas. Even if these measures pass the Senate, which is unlikely, they fall well short of comprehensive immigration reform. Congress should remember that immigration is of growing importance for the future of the country: Without new immigrants, the US population is slated to start declining in the 2030s. 

Probability:

The United States backs the European Union’s strategic autonomy

It’s in the US interest for Europe to take on more responsibilities as a global actor and increase its capabilities. The Biden administration should welcome EU strategic autonomy instead of worrying about whether it will harm NATO. So long as the threat posed by Russia persists, Central European countries will want a major role for the United States and NATO in European security. But Russia is not the only threat to the security of Europe, which also faces challenges in the Middle East and Africa in the form, for example, of state failures or refugee and migrant flows. If the Biden administration is serious about making Asia its primary geopolitical focus, it would benefit from Europe equipping itself to manage these other issues on its own.

The EU defines strategic autonomy as ensuring its “capacity to act autonomously when and where necessary and with partners wherever possible.” That does not exclude cooperation with the United States, but European leaders want the ability to act independently where it suits their interests—including their exercise of economic power in realms such as technology. The EU has become a norm-setter on data privacy and is venturing into new competition rules to curb the power of US tech giants in Europe. To an extent, transatlantic economic differences are nothing new, and debates between Europeans and Americans on an issue-by-issue basis can actually be beneficial for both sides. But arguing with Europe over its right to achieve sovereignty will only undermine the alliance over the long run. Being an ally of the United States should not be equated with subservience to Washington. The United States, which helped facilitate European integration after World War II, should continue to be its chief proponent.

Probability:

Mathew Burrows is the director of Foresight at the Scowcroft Strategy Initiative and the co-director of the New American Engagement Initiative within the Atlantic Council’s Scowcroft Center for Strategy and Security.

Robert A. Manning is a senior fellow with the Scowcroft Center for Strategy and Security and its Foresight, Strategy, and Risks Initiative at the Atlantic Council.

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State of the Order: Assessing November 2021 https://www.atlanticcouncil.org/commentary/blog-post/state-of-the-order-assessing-november-2021/ Thu, 16 Dec 2021 16:24:47 +0000 https://www.atlanticcouncil.org/?p=468159 The State of the Order breaks down the month's most important events impacting the democratic world order.

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Reshaping the order

This month’s topline events

Biden-Xi Summit. President Biden and Chinese President Xi Jinping met for several hours in a virtual summit that covered Taiwan, Beijing’s economic policies and human rights practices, climate change, nuclear and hypersonic weapons, and other topics. While both leaders expressed a desire to maintain constructive dialogue, Xi reportedly warned that US support for Taiwan was “playing with fire” and that engaging in “ideological demarcation” and “group confrontation” would “inevitably bring disaster to the world.”

  • Shaping the order. The summit highlighted the Biden administration’s efforts to engage with Beijing and seek to manage differences, even as it reorients US foreign policy around a long-term strategic competition with China. But the summit also signaled a deepening divide between the two powers, as Beijing shows no signs of backing away from its ongoing assault on key tenets of the rules-based order.
  • Hitting home. China’s activities represent a direct challenge to US security and economic interests, as well as US support for democracy and human rights.
  • What to do. The Biden administration should continue its dual-track approach to China, pursuing engagement while standing firm against Beijing’s violations of the rules-based order. At the same time, the administration should bolster coordination through the G7 and other venues that bring key allies and partners across Europe and the Indo-Pacific to the table.

Russia Threatens Ukraine. With up to one hundred thousand Russian troops amassing near the Ukraine border, US officials expressed alarm that Moscow could be planning a further invasion of Ukraine. CIA Director Bill Burns was dispatched to Moscow, while President Joe Biden reiterated America’s “unwavering support” for Kyiv and NATO Secretary-General Jens Stoltenberg warned that an incursion by Russia would carry a “high price.” In addition, Ukrainian President Volodymyr Zelensky announced that his government had uncovered plans for an attempted coup against him, allegedly organized by the Kremlin.

  • Shaping the order. While Russia already occupies Crimea and portions of eastern Ukraine, a full-on military invasion would constitute a direct violation of one the most fundamental norms of the rules-based order – territorial sovereignty – and could lead to a protracted military confrontation. Short of an invasion, the Kremlin’s military threats and reported coup attempts represent a pattern of coercive pressure against neighboring states.
  • Hitting home. The American people have a strong interest in supporting the people of Ukraine, who are looking for help in standing up against a hostile neighbor whose provocative actions could undermine peace and stability.
  • What to do. In concert with NATO allies, the Biden administration should reinforce to the Kremlin the harsh consequences that would follow if it orders an invasion, while accelerating delivery of weapons systems to Kyiv that could deter an invasion and degrade Russia’s military effectiveness.

New Climate Pact. Wrapping up a UN-sponsored global climate conference in Britain, delegates from nearly 200 countries agreed to a significant new climate agreement that, for the first time ever, includes language explicitly calling for a “phase down” of coal power, as well as a curb on methane emissions and deforestation. The Glasgow Climate Pact reaffirms previous goals to limit any significant additional rise in global warming, but left unresolved how much and how quickly states should aim to cut emissions, calling instead on governments to set more ambitious targets in 2022.

  • Shaping the order. While the climate summit demonstrated a clear consensus on the need to do more to confront global warming, it also highlighted ongoing disagreements, particularly between developed and developing countries, on how fast to implement climate mitigation measures. Several major emitters, including the United States, Japan, and the European Union, have pledged to move to zero emissions or be “climate neutral” by 2050, but concrete plans for meeting these pledges remain unclear.
  • Hitting home. The impacts of climate change, including increased temperatures, rising sea levels, and more extreme weather, are becoming more visible in the United States. If followed by action, the new agreement could help mitigate these impacts, though its economic consequences are still uncertain.
  • What to do. The Biden administration should continue work with Congress on bipartisan solutions to help the United States reach its net-zero emissions goals, including more significant investments in green energy technology.

Quote of the month

“Democracy is being challenged from both inside and outside. Authoritarian regimes try to influence the outcomes of our democratic elections. In the United States, hundreds of people attacked the Capitol, the heart of [American] democracy. In the European Union, some are questioning basic democratic principles upon which our union is built. It is time again to stand up for the values that define our democracies.”

– EU Commission President Ursula von der Leyen, speaking at the Atlantic Council’s Distinguished Leadership Awards, November 10, 2021

State of the Order this month: Unchanged

Assessing the five core pillars of the democratic world order    

Democracy ( ↔ )

  • After weeks under house arrest, Sudan’s ousted prime minister was reinstated after agreeing to a deal with military leaders that deposed him last month, including concessions that are likely to hamper Sudan’s fragile transition to democracy.
  • Chinese tennis star Peng Shuai disappeared for weeks after she accused a top Chinese leader of sexual assault, prompting concerns that the Chinese government was retaliating against her.
  • After being disqualified by the Libyan election commission for a war crimes conviction, Saif al-Islam Qaddafi, the son of the former Libyan dictator Moammar Qaddafi, was later permitted to run for president in the country’s upcoming election. He remains under indictment by the International Criminal Court for crimes against humanity stemming from his actions to suppress a popular uprising in 2011.
  • Overall, the democracy pillar was unchanged.

Security ( )

  • As described above, US and NATO officials expressed concerns over a potential Russian invasion of Ukraine, as Moscow continued its large military buildup near the Ukrainian border.
  • US and EU officials accused Belarusian dictator Aleksandr Lukashenko of waging “hybrid warfare” against the European Union by facilitating the travel of thousands of migrants from the Middle East to Minsk and then pushing them across the border with Poland.
  • Russian and Chinese defense ministers signed a roadmap for closer military ties, including stepping up strategic military exercises and joint patrols, as both nations sought to expand their “strategic partnership.”
  • As discussed above, President Biden and Chinese President Xi Jinping held a wide-ranging virtual summit that represented an attempt by both nations to maintain high-level engagement, despite growing tensions.
  • On balance, the security pillar was weakened.

Trade ( ↔ )

  • Trade ministers from the United States, European Union, and Japan agreed to renew a trilateral partnership aimed at upholding global trade norms and addressing challenges “posed by non-market policies and practices of third countries,” a veiled reference to China.
  • The EU imposed substantial new tariffs on fiber optic cables from China for alleged anti-dumping violations, a move that could impact the supply of 5G telecommunications equipment and spark new trade tensions.
  • Overall, the global trade pillar was unchanged.

Commons (↔)

  • Nearly 200 nations signed the Glasgow Climate Pact, which, as described above, called for new climate mitigation measures but left unresolved how much and how quickly states should aim to cut emissions.
  • The omicron variant, a new and potentially more contagious strand of the coronavirus first detected in southern Africa, began to spread across the globe. Many nations, including the United States and Europe, imposed new international travel restrictions as the World Health Organization warned that the variant posed a “very high” global risk.
  • Xi Jinping announced that China will deliver another 1 billion doses of its COVID-19 vaccines to Africa, though several studies have questioned the efficacy of these vaccines.
  • On balance, the global commons pillar was unchanged.

Alliances (↔)

  • After a five-year hiatus during the Trump administration, President Biden hosted Canadian Prime Minister Justin Trudeau and Mexican President Andrés Manuel López Obrador for a North American Leaders’ Summit, held in-person, to discuss cooperation on shared economic and political challenges.
  • A dispute between France and Britain over post-Brexit fishing rights escalated after Britain denied licenses to French fishing boats and the EU threatened retaliatory actions.
  • British and Israeli officials announced a new trade and defense pact that will bolster cooperation on cybersecurity and efforts to prevent Iran from obtaining nuclear weapons.
  • On balance, the alliances pillar was unchanged.

Strengthened (↑)________Unchanged (↔)________Weakened ()

What is the democratic world order? Also known as the liberal order, the rules-based order, or simply the free world, the democratic world order encompasses the rules, norms, alliances, and institutions created and supported by leading democracies over the past seven decades to foster security, democracy, prosperity, and a healthy planet.

This month’s top reads

Three must-read commentaries on the democratic order     

  • Patricia Kim, in Foreign Affairs, suggests that China’s growing partnerships with Russia, Pakistan, and Iran could in time form the basis of its own alliance network, as Beijing prepares for long-term competition with the United States.
  • In an unusual joint op-ed in the National Interest, the Russian and Chinese ambassadors in Washington castigated Biden’s planned Summit for Democracy as “an evident product of its Cold-War mentality” and warned that “value-based diplomacy” will provoke division and confrontation.
  • Anne Applebaum’s piece in The Atlantic, titled “The Bad Guys Are Winning,” suggests that if the 20th century represented a slow, uneven struggle that ended with the victory of liberal democracy over other ideologies, the 21st century is, so far, a story of the reverse.

Action and analysis by the Atlantic Council

Our experts weigh in on this month’s events

  • Fred Kempe, writing for CNBC, suggests that those who argue the United States is withdrawing from the world stage could not have it more wrong.
  • Dan Fried, John Herbst, and Alexander Vershbow, in the New Atlanticist, outline strong actions the United States and its NATO allies should take to deter a potential Russian invasion of Ukraine.
  • Dan Fried and Rose Jackson, in the New Atlanticist, suggest that by focusing on tech standards and anti-corruption measures, the Biden administration can help ensure a successful Summit for Democracy.
  • Matthew Kroenig and Dan Negrea, in the National Interest, contend that the United States should embrace a policy of confrontation with China in order to dissuade the Chinese Communist Party from aggressive behavior that could lead to military conflict.
  • In a Fast Thinking assessment, Dave Shullman and Ashley Feng provide a breakdown of the Biden-Xi virtual summit.

__________________________________________________

The Democratic Order Initiative is an Atlantic Council initiative aimed at reenergizing American global leadership and strengthening cooperation among the world’s democracies in support of a rules-based democratic order. Sign on to the Council’s Declaration of Principles for Freedom, Prosperity, and Peace by clicking here.

Ash Jain – Director for Democratic Order
Dan Fried – Distinguished Fellow
Jeffrey Cimmino – Assistant Director
Danielle Miller – Project Assistant
Paul Cormarie – Georgetown Student Researcher

If you would like to be added to our email list for future publications and events, or to learn more about the Democratic Order Initiative, please email AJain@atlanticcouncil.org.

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Kroenig and Ashford debate US global standing under Biden https://www.atlanticcouncil.org/insight-impact/in-the-news/kroenig-and-ashford-debate-us-standing-in-the-world-amid-omicron-iran-nuclear-deal-negotiations-and-the-summit-for-democracy/ Sun, 12 Dec 2021 15:34:00 +0000 https://www.atlanticcouncil.org/?p=467314 On December 3, Foreign Policy published a biweekly column featuring Scowcroft Center deputy director Matthew Kroenig and New American Engagement Initiative senior fellow Emma Ashford assessing the latest news in international affairs. In the column, they discuss the latest Omicron restrictions, assess the Pentagon’s 2021 Global Posture Review and ongoing Iran nuclear deal negotiations, and debate the […]

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original source

On December 3, Foreign Policy published a biweekly column featuring Scowcroft Center deputy director Matthew Kroenig and New American Engagement Initiative senior fellow Emma Ashford assessing the latest news in international affairs.

In the column, they discuss the latest Omicron restrictions, assess the Pentagon’s 2021 Global Posture Review and ongoing Iran nuclear deal negotiations, and debate the merits of Biden’s Summit for Democracy.

The United States and Israel should put credible military options for destroying Iran’s nuclear facilities back on the table. They might have to employ those options as a last resort, but, in the meantime, this will motivate China and other powers to apply more economic pressure on Iran, as they will want to prevent an Iranian nuclear bomb and war in the Middle East.

Matthew Kroenig

Even though it is challenging, the [Biden] administration needs to try to find some common ground with Iran, perhaps an interim deal that would freeze their enrichment in exchange for some sanctions relief. It’s not great, but all the other options are worse.

Emma Ashford

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Colombia’s president: The US helped Colombia through COVID-19. Now it’s time for the next phase of cooperation. https://www.atlanticcouncil.org/commentary/transcript/colombias-president-the-us-helped-colombia-through-covid-19-now-it-must-help-with-peace-building/ Thu, 09 Dec 2021 18:13:39 +0000 https://www.atlanticcouncil.org/?p=466549 Duque listed opportunities for the United States to invest in Colombia and improve economic opportunity in the country—and Cardin and Blunt reiterated the United States’ willingness to continue its two-hundred-year partnership with Colombia.

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Read the report

Report

Dec 8, 2021

A plan for Colombia’s COVID recovery and why it matters for the United States

By Atlantic Council US-Colombia Task Force

The continuity of Colombia’s prosperity and role as a key US partner depends, in part, on the country’s ability to swiftly recover from COVID-19. In 2020, lockdowns and mobility restrictions led to a major recession in Colombia, exacerbating unemployment, poverty, and pre-existing inequalities.

Americas Civil Society

On Wednesday, US Senators Ben Cardin (D-MD) and Roy Blunt (R-MO), co-chairs of the Atlantic Council’s US-Colombia Task Force, presented Colombian President Iván Duque with the task force’s latest report, which provides a blueprint for US-Colombia cooperation in a post-COVID world. Duque listed opportunities for the United States to invest in Colombia and improve economic opportunity in the country—and Cardin and Blunt reiterated the United States’ willingness to continue its two-hundred-year partnership with Colombia, focusing on economic, health, and good-governance goals. Below, edited for length and clarity, is Duque, Cardin, and Blunt’s conversation with Jason Marczak, director of the Atlantic Council’s Adrienne Arsht Latin America Center.

JASON MARCZAK: President Duque, I’ll turn to you for reactions to the report, but first I’ll ask Senator Cardin and Senator Blunt to share some of the topline findings that we are releasing today. These ideas and recommendations, which come just about six months before the United States and Colombia will celebrate two hundred years of bilateral relations, focus on four strategic pillars: accelerating vaccine rollouts; promoting investment and job creation, strengthening Colombia’s social pact; [and] enhancing rule of law, peace agreement implementation, good governance, and human-rights protections.

Senator Cardin, let me start with you. I’d like to ask what you see as the main takeaways of this publication. And why do you believe this report and the ideas being released today, [in] which both you and Senator Blunt played an integral role. Why do you see this as so critical for US interests, especially given the many challenges that we face across the region and across the world?

SENATOR BEN CARDIN: We’ve been on a very positive path on Colombia over a long period of time. We’re now implementing the Peace Colombia Plan, which is for prosperity and peace in the region. Colombia is a critical partner for the United States’ national-security [interests]. They are pivotal in our global fight against drug trafficking, against money laundering, [and] against organized crime. They’re our partner in the region in regard to our security interests and economic prosperity. So it’s in the US interest for us to strengthen that partnership.

It was a challenge to implement the peace plan, and then put on top of that the problems of Venezuela and two million refugees coming into Colombia. That’s a burden that is extremely difficult to manage.

Colombia is a critical partner for the United States’ national-security [interests]. They are pivotal in our global fight against drug trafficking, against money laundering, [and] against organized crime… So it’s in the US interest for us to strengthen that partnership.

Senator Ben Cardin (D-MD)

Then comes COVID-19. COVID-19 [has] been devastating to all countries, but [for] Colombia, it affected their economy by a significant reduction in their economic performance, and that’s understandable. We recognize they’ve had a challenge getting people vaccinated [and] getting the virus under control…

We need to help Colombia deal with the extra burdens created by COVID-19. And when you look at the four pillars that this report represents—getting the vaccine rollout, making sure that’s done; getting job creation, which is critically important to the long-term peace and prosperity of the country; more robust social pact—we recognize that the COVID-19 had a particular impact on underserved communities and those that are more vulnerable and made it even worse; and enhancing rule of law, which is a path that Colombia has been on, and we need to make sure that we strengthen that during COVID-19 where, again, it was challenged. So I think it [points] to the four pillars that are critically important to enhance our partnership in the mutual interests of our two countries…

But it’s amazing that next year we’re going to celebrate [the] two hundredth anniversary [of US-Colombia relations]. You cannot take that for granted, and I am really optimistic about our future. And we’re going to make sure that that optimism is well placed.

JASON MARCZAK: Senator Blunt, building off of Senator Cardin’s comments, how do you see these ideas being taken into account in your own deliberations and your own work in the US Senate?

SENATOR ROY BLUNT: A two-hundred-year [US-Colombia] relationship, as my good friend Senator Cardin just said, is no small relationship for us to have had. We’ve been around a while, but we haven’t been around much longer than this relationship has been. And it’s been a relationship of working together, a partnership of hope that our countries could get even closer together. But the long-term commitment to democracy by Colombia in South America is unique in how long they have been committed to these kinds of values. We want to do all we can to continue to make this partnership better and stronger.

You know, in the last twenty years, Senator Cardin and I, working together in the House as well, have been involved in Plan Colombia and then Peace Colombia and then the follow-up that we’re doing right now. And I think about twelve billion dollars have been invested by the United States during that twenty-year period of time in Colombia. It is a different kind of long-term partnership than we have with almost anybody else in the world. It’s one that we value.

I think one of the things coming out of this report is really the importance of looking at where that money has been used most effectively. And we need to talk to our Colombian partners with even more intensity… Let’s look at what we’ve done in twenty years and let’s analyze where we’ve made the most difference. Have we made the most difference in the rule of law? Have we made the most difference when we invested directly in the economy? Have we made investments in non-government organizations and social and community groups? This is a good time to evaluate where we can be the most helpful.

It’s also a good time to evaluate the challenges in our economic relationships. The fact that Colombia had a significant number of projects that were bid [upon] and no American company bid on those infrastructure road projects. I think we ought to be asking why.

What do we need to do to be sure that we’re the principal partner for the people and the government of Colombia as they move forward? What was missing, and what do we need to do to assist in opening that door wider and with more confidence for American companies? The things that happen in the hemisphere really matter… In South America, the partnership with Colombia is the one not only that we have the longest and greatest confidence in, but it also allows us to impact other countries through our partners in Colombia in ways that we can never have directly the same kind of influence or the same kind of advice given as our Colombian partners are able to give.

The partnership with Colombia is the one not only that we have the longest and greatest confidence in, but it also allows us to impact other countries through our partners in Colombia

Senator Roy Blunt (R-MO)

And so all of those things are things that I think this report focuses on. And I think it’s pretty clear, looking ahead, we need to see where we’ve been the most effective. I think our investment in Colombia this year, almost half a billion dollars, is the biggest investment in a decade. And so, American partners there, our Colombian partners: Who would have thought that President Duque would be dealt this hand, where you have so many challenges. Of Venezuela, of COVID-19, of the reaction to Peace Colombia and the impact that had on the internal workings of the government itself… I look forward to what we can do with this continued partnership.

JASON MARCZAK: President Duque… I’d like to ask you where you see the greatest opportunity to move forward [with the] implementation of some of the ideas, recommendations discussed by both senators, and also given the focus of the report on Colombia’s COVID-19 recovery, how worried are you as well about the new variant and how that could affect Colombia’s recovery trajectory?

PRESIDENT IVÁN DUQUE: … We’re proud and we’re glad that this report is a very significant validator of the policies that we are embracing in Colombia. But if I may react to it point by point, the first thing that has to be said is that the United States has supported Colombia [in facing] the COVID-19 crisis.

We got strong support… [from] President Trump when he supported us when we required ventilators. And we have received amazing support from President Biden and his team because we have received more than six million vaccines to be deployed around the country. And we value that because that has made the United States the biggest donor [in helping] Colombia to face the consequences of COVID-19. And one of the things that I want to highlight is that as of today, our one-shot vaccination rate… has reached levels that are even above the United States and Germany.

And we’ve done that because we have been deploying all the capacities throughout the country. And, yes, we have [surpassed] 73 percent of the Colombian population with one single [dose]. We already [surpassed] 50 percent of the population with full vaccination. And we want to accelerate in the next weeks so that we can have full vaccination for 70 percent of the population, so that that could support us in the path [to] having herd immunity. But I want to also reiterate that we have to keep on expanding our capacity to immunize the population. So that’s why we already started third shots for people above [age eighteen], and pretty soon we’ll get also to youngsters. But I think it’s a great message that Colombia’s doing good, at this moment, in the way that we have managed, integrally, the COVID-19 crisis.

Now, when we look at the economic consequences, I think that when we launched the equivalent of the Colombian New Deal last year, called Compromiso por Colombia, and when we launched all the social responses for the people in need, where we basically [increased] from 3.5 to more than nine million households that are receiving the nonconditional transfers and the conditional transfers, and that we have been able to subside 40 or 50 percent of the payroll for more than four million employers in Colombia, and that we have been able to put together the most ambitious social plan ever in this country, that is also a trigger of reactivation.

And we’re going to end this year with the highest economic growth in this century. And that means we’re going to be above 9 percent. And that is very good news because that demonstrates Colombia’s resilience. So I’m glad that the report highlights that looking at the present and the future, the economic recovery—hand in hand with massive vaccination—is something that is really making a difference.

Now, on the third front, and that’s also very important, is that in order to build a lasting peace in Colombia, we have to… not only [attend to] those municipalities that were historically badly hit by violence, but we have also to expand the services in the rest of the country. And we had the visit of the United Nations secretary-general some days ago. And he acknowledged something that is very important: Colombia has become a reference model on peacebuilding. And it has become a reference model because we have been able to mobilize resources like no other time before to 170 municipalities that were affected by violence, and that now are receiving the highest public investment ever.

But what is interesting is that hand-in-hand, this year we’re going to get to a record high in terms of land titling. And that will mean that by the end of this year my administration will already grant fifty thousand property titles around the country—fifty thousand—which is more than what was done in the eight years before my administration, and also in the eight years between 2002 and 2010.

So that demonstrates the capacity that we have to [have] in the field. We have been also advancing on the national Kadaster that is crucial to [protecting] our land and to have environmental concerns to be addressed. And we’re also very happy to say that in terms of tertiary roads and roads around the country, we are fulfilling the task. And just on four-generation highways, just looking at all the concessions, we’re going to end this administration with the same amount of new kilometers of concessions that Colombia had during the first twenty-five years of first- and second- and third-generation concessions. So that means that the country, it’s moving forward. We’re recovering pre-pandemic employment levels. So I value that the report makes this highlight because, yes, we’re building back better.

The country, it’s moving forward. We’re recovering pre-pandemic employment levels…. Yes, we’re building back better.

Colombian President Iván Duque

And… how are we adapting to the new mutations of this virus?… We have to do something there in order to have global herd immunity, because if most of us do what we have to do, but there are some, that for any reason, can’t do it, that also puts in jeopardy the possibility of having globally head immunity, and that allows mutations. So I think we have to do something stronger there.

And I will finish by saying: Peace with legality. Today Colombia, it’s reaching most of the municipalities that were affected by violence in the last fifty years with a historical investment. The UN, the Kroc Institute, most of the reference validators that we have are saying that Colombia is [becoming] a reference model for peacebuilding around the world. So in a nutshell, all the four items that are considered in the report, the way that the proposals are planned, for me continue the line that the Atlantic Council has had. And we look forward that for the two-hundred-year celebration, we can strengthen all these policies and build what we have already discussed with the Atlantic Council. That is to have a long-term policy between the United States and Colombia that is beyond the political cycles.

JASON MARCZAK: Senator Cardin, let me give you an opportunity to react to some of President Duque’s comments.

SENATOR BEN CARDIN: … Impressive record during this very challenging time. Congratulations on your handling of this crisis as far as COVID-19 is concerned.

You mentioned a lot of the areas where I think this report is really centered on. Yes, we want to complete the vaccine rollout to make sure that everyone gets the vaccine, that [a slow rollout is] not as a result of not having the availability. And secondly, when we look at job creation—which is a critically important part—we have tools in the United States… How we use our development corporation, how we participate in infrastructure projects, what we do with agriculture are all areas where I think we can complement the leadership that you have provided in regards to economic growth.

And in regard to the social compact and the rule of law, this is a continuing struggle. We recognize that. This is not easy. You have detractors that are trying to make it more difficult. So I think we can find partnerships there to help you in that regard.

So I think you’re going to find in the United States Congress a very supportive partner, that we’re going to be looking at how we can creatively use our institutions and resources to really reinforce the plans that you have brought out. And I think when you look at the specific recommendations in this report, it complements very much your strategy for peace and prosperity in your region and dealing with the challenges of COVID-19.

JASON MARCZAK: Senator Blunt.

SENATOR ROY BLUNT: Well, again, the challenges that the government has faced have been significant. They have been unprecedented in many ways…

When I was in the House during the [George W. Bush] administration, I helped start the negotiations for the trade agreement that we were able to finalize when I got to the Senate in 2011. I think immediately that allowed about 80 percent of our industrial products and half of our agricultural products to go in duty-free. We continue to move along that line. By the end of this decade, 2028 or so, there will be free trade across the board in our countries.

Nearsourcing is a real opportunity for us with Colombia as we look for ways to condense our worldwide sourcing issues. Why wouldn’t we want to be close and be close with our friends? I do think for that to work we need to be thinking of ways we can encourage and help the workforce of Colombia become more technically ready for that workforce of the next decade and the decade after that. There’s a real opportunity here. We should make the most of it.

And again, back to Senator Cardin’s comments, the rule of law, the certainty of relationship, the economy that is obvious and above board so that when we make those determinations we understand that everything that was on the table [was what had] to be considered, not the other kinds of things that make it so difficult to do business in some parts of the world. But I think we’ve come through a challenging period here, and I think in many ways we’ve come through that challenging period with our relationship stronger and our interest in looking for partners that are closer to us—so geographically and philosophically and by standards of law—than we might have had in other places. It’s a good time for this relationship, and we need to move forward.

I think we’ve come through a challenging period here, and I think in many ways we’ve come through that challenging period with our relationship stronger and our interest in looking for partners that are closer to us… It’s a good time for this relationship, and we need to move forward.

Senator Roy Blunt (R-MO)

JASON MARCZAK: President Duque, would you like to share any final comments before the senators have to leave?

PRESIDENT IVÁN DUQUE: I believe that what the senators said, it’s crucial. And how do we make this happen immediately?

So my take is that the two-hundred-year celebration shall be the opportunity for us to have [a] Colombia-US long-term comprehensive strategy. And it’s not just about putting resources, but it’s about using all the institutional tools in order to strengthen the relationship.

Let me give you one example. One week ago, we got the approval [to export] mangoes from Colombia to the United States. Last year, we got green peppers. Just on those two projects, and if we started looking at accessibility in a broader way, these can open the opportunities for many people around the country to earn a job and even to turn from illegal crops to legal ones.

The second thing that is very important: We need to strengthen investment. So we’re going to have biddings for fifteen megaprojects in the next eight months. We want to have US companies participating in those bids. We want to bring investments from the United States. We still have to do much work together on the climate agenda. But I think what we did in Glasgow was very important because we’re aligned. So when we talk climate change, trade, investment, security, [and peacebuilding], I think we are [on] the right track.

And on security: I think last year we saw that the consumption of drugs around the world skyrocketed, including the United States, obviously including Colombia. But I think in the co-responsibility procedures that we have to embrace, I think we have to do a lot more in the United States on prevention because we have reached record highs on interdictions. We have destructed cocaine laboratories around the country. We have captured kingpins. We have destroyed structures. But we have to do something very strong, as well, to reduce the demand from the United States, and I think that’s also very important for long-term peace-building.

Read the report

Report

Dec 8, 2021

A plan for Colombia’s COVID recovery and why it matters for the United States

By Atlantic Council US-Colombia Task Force

The continuity of Colombia’s prosperity and role as a key US partner depends, in part, on the country’s ability to swiftly recover from COVID-19. In 2020, lockdowns and mobility restrictions led to a major recession in Colombia, exacerbating unemployment, poverty, and pre-existing inequalities.

Americas Civil Society

Watch the full event

The post Colombia’s president: The US helped Colombia through COVID-19. Now it’s time for the next phase of cooperation. appeared first on Atlantic Council.

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Impacts of the pandemic on US productivity growth https://www.atlanticcouncil.org/commentary/blog-post/impacts-of-the-pandemic-on-us-productivity-growth/ Wed, 08 Dec 2021 20:54:17 +0000 https://www.atlanticcouncil.org/?p=466271 After 45 years of decelerating productivity growth, the pandemic's impact on economic activity has indicated the potential for a reversal of the trend. It remains to be seen whether this is durable or temporary, but the answer will significantly impact the US economy's long-term outlook.

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Nobel prize winning economist Paul Krugman once famously said “productivity isn’t everything, but in the long run it is almost everything.” Economic productivity, or output per unit of input, plays an important role in a society’s ability to raise its standard of living over time. For most of the past 45 years productivity growth in the United States and other advanced economies has slowed. However, the pandemic’s unprecedented impact on economic activity has indicated the potential for a reversal of that trend and increased productivity in the United States. It remains unclear if these indications are meaningful and durable, or if fluctuations are cyclical and temporary. The answer will significantly impact the US economy’s long-term outlook.

Productivity growth is a significant driver of GDP growth and heavily impacts workers well-being. When an economy increases its output without increasing inputs, its people can consume and earn more without paying or working more. Increased productivity also helps prevent inflationary pressures. Though increasing the number of hours worked or the amount of people working can also increase growth, continued long-term growth requires increased productivity within given limits on hours and people.

Increased productivity might occur because workers gain skills or education (human capital), or because workers obtain more effective equipment (physical capital). Economists also refer to total factor productivity (TFP), which is defined as the portion of productivity that is not directly attributed to capital accumulation and reflects other dynamics, such as technological or managerial innovation. In the United States, a common measure of productivity is labor productivity, which is the real (inflation adjusted) output per hour worked, reported by the US Department of Labor’s Bureau of Labor Statistics (BLS).

In the boom times following World War II from 1948-1973, productivity grew at a 2.8 percent annual rate and TFP, reflecting modern innovations, accounted for over half of the growth. Productivity growth helped drive the 3 percent annual real income growth for the median American family during this time. Incomes doubled once every 23 years, approximately once a generation. Amidst the seemingly rapid technological transformations of the digital age, productivity growth since the early 1970’s has been significantly weaker, excluding the period from 1995-2004 when the advent of the internet turbocharged productivity. Real median family income growth has also slowed significantly since the early 1970’s for a variety of reasons, including low productivity growth.

Experts have debated the cause of the productivity growth slowdown in the United States. To date there is not definitive evidence for any one reason and similar trends have played out across many other advanced economies. Several drivers are often suggested, such as fewer transformational and obtainable innovations as compared to the mid-20th century, decreased market competition and business dynamism, slower human capital growth, aging demographics, and lower public investment in R&D and infrastructure. Some also believe productivity growth is higher than reflected in the data. They argue that part of the story is a statistical measurement issue due to difficulty in track digital innovations. However, this seems unlikely to be a primary component of weaker productivity growth.

Since the outbreak of the COVID-19 pandemic in early 2020, US productivity growth data experienced several strong quarterly reports, until the latest reading for the third quarter of 2021 that was the lowest in over 60 years. The last report likely reflected disruptions in the economic recovery from when the Delta variant emerged and slowed activity as COVID cases rose sharply compared to the second quarter. Regardless of these factors, productivity data is often volatile in the immediate recovery after a recession due to cyclical composition effects. In contractionary situations, struggling businesses sometimes let the least productive workers go first and keep just enough workers to survive. Once demand and business activity returns, there is a temporary boost in productivity growth before employment meaningfully expands again during the initial stages of a recovery.

Despite this pattern, there is basis to think that the nature of the pandemic recovery could lead to continued increases in productivity growth. The pandemic altered the way many businesses and workers operate. Some aspects of these disruptions could lead to lasting changes that would boost productivity. Surveys suggest businesses are increasing and accelerating investment in new technologies and operational efficiency methods. Academic research finds that flexible working arrangements including more work from home time increase productivity as a result of time saved commuting, and consumers are relying on digital spending methods that lower business costs at a faster clip

Over the course of the pandemic some data has supported this story. Capital expenditures by businesses on equipment and intellectual property rights are in one of the strongest cycles in decades according to Morgan Stanley, as evidenced by overall business investment and quickly growing orders of capital goods.

Additionally, the bipartisan infrastructure legislation signed into law and President Biden’s Build Back Better proposals working their way through Congress are expected to increase productivity growth. They contain the highest level of physical and human capital investment the government has made in decades.

The path for US productivity growth in the years ahead is uncertain. Even if it does increase, it will be important to ensure that the gains are dispersed to workers through higher wages and a growing economy, and not concentrated in a small collection of larger firms. How productivity growth unfolds will dictate much of the US economy’s future strength. Enhanced productivity would improve American’s living standards while positioning the US economy to meet future challenges such as climate change, public health threats, and geopolitical competition.

Jeff Goldstein is a contributor to the Atlantic Council’s GeoEconomics Center. During the Obama administration he served as the Deputy Chief of Staff and Special Assistant to the Chairman of the White House Council of Economic Advisers. He also worked at the Peterson Institute for International Economics. Views and opinions expressed are strictly his own.

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A plan for Colombia’s COVID recovery and why it matters for the United States https://www.atlanticcouncil.org/in-depth-research-reports/report/a-plan-for-colombias-covid-recovery-and-why-it-matters-for-the-united-states/ Wed, 08 Dec 2021 20:30:00 +0000 https://www.atlanticcouncil.org/?p=449508 The continuity of Colombia’s prosperity and role as a key US partner depends, in part, on the country’s ability to swiftly recover from COVID-19. In 2020, lockdowns and mobility restrictions led to a major recession in Colombia, exacerbating unemployment, poverty, and pre-existing inequalities.

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A report by the Atlantic Council US-Colombia Task Force, co-chaired by Senator Ben Cardin (D- Maryland) and Senator Roy Blunt (R-Missouri)

With Chairman Gregory Meeks (D-New York); Representative Dan Crenshaw (R-Texas); Representative Ruben Gallego (D-Arizona).

And Jason Marczak, Camila Hernandez, Michel Janna

Executive summary

On June 19, 2022, the United States and Colombia will celebrate two hundred years of bilateral relations. Historically, Colombia has been an indispensable ally, serving as an anchor for US relations in Latin America and the Caribbean (LAC) and collaborating with the United States to address regional and global needs. It hosts the largest number of Venezuelan migrants and refugees, leads security and defense efforts in Central and South America, and plays a pivotal role in the global fight against drug trafficking, money laundering, and organized crime.

The continuity of Colombia’s prosperity and role as a key US partner depends, in part, on the country’s ability to swiftly recover from COVID-19. In 2020, lockdowns and mobility restrictions led to a major recession in Colombia, exacerbating unemployment, poverty, and pre-existing inequalities. With US support for inclusive and sustainable COVID-19 recovery, Colombia will be better able to partner with the United States to advance common interests, particularly amid increasing regional and global challenges. 

This report outlines a series of policy actions that the US-Colombia partnership could take to accelerate inclusive and sustainable COVID-19 recovery in Colombia, strengthening the US-Colombia alliance. It is a product of the Atlantic Council US-Colombia Task Force, a bilateral and multisectoral group of experts in the United States and Colombia, co-chaired by Senator Ben Cardin (D-MD) and Senator Roy Blunt (R-MO). 

Task Force recommendations fall into four strategic pillars: accelerating vaccine rollout; promoting investment and job creation; strengthening Colombia’s social pact; and enhancing rule of law, peace-agreement implementation, good governance, and human-rights protections. Advancing US-Colombia relations along these pillars will safeguard key US security, economic, political, and humanitarian interests, and support Colombia’s path toward greater internal peace, a stronger democracy, and sustainable and inclusive economic growth. The group’s sixteen policy solutions are outlined below.

US-Colombia Task Force recommendations

Vaccine rollout: Jump-starting the economy

1. Build on previous US commitments to share COVID-19 vaccines globally by increasing bilateral donations to Colombia. Direct donations would circumvent delivery and supply problems currently faced by the COVID-19 Vaccines Global Access (COVAX) Facility, ensuring timely and equitable vaccine access for Colombians, particularly in rural areas, as well as Venezuelan migrants and refugees in Colombia. The United States could also consider allocating vaccines to Venezuela that will then be distributed in Colombian localities with high Venezuelan presence.

Job creation: The path to inclusive growth

2. Strengthen the US Development Finance Corporation’s (DFC) ability to mobilize more US investment to Colombia by

  1. studying the need to increase the agency’s budget for equity investment and technical assistance, to support growth-stage companies and project identification and preparation in Colombia;
  2. permitting partnership with multilaterals and/or organizations in which the United States is a shareholder, to share due-diligence responsibilities; and
  3. encouraging engagement with Colombian stakeholders at the city and municipality levels in addition to DFC’s work with Colombia’s national government.

3. Provide additional US government credit guarantees to support lending for small and medium-sized enterprises (SMEs) in Colombia and promote inclusive economic growth. Also, prioritize financing for large infrastructure projects and projects in sectors that benefit vulnerable and historically marginalized communities.

4. Advance opportunities and spaces (e.g., strategy sessions, roundtables) for the US Department of the Treasury, US Department of State, United States Trade and Development Agency (USTDA), US Department of Transportation (USDOT), US Department of Energy (DOE), and DFC to work with US and Colombian subject-matter experts to identify and structure highly bankable projects in Colombia.

5. Incentivize US private-sector participation in Colombia’s large infrastructure projects by instructing the US Department of the Treasury and USTDA to work with industry-leading US firms to

  1. identify barriers faced by US companies to commit capital or financing to infrastructure projects; and
  2. put forward proposals to Colombia’s National Infrastructure Agency (ANI) on how to address investment concerns.

6. Explore adoption of a modernized version of enterprise funds as a US foreign policy instrument toward Colombia. A potential enterprise fund in Colombia should

  1. adopt more flexible business plans; 
  2. establish partnerships with other institutions (e.g., DFC and the International Finance Corporation) to leverage additional investment and lessons learned from non-US funds; and 
  3. incorporate technical-assistance programs led by nongovernmental organizations.

7. Work with the US Department of Agriculture to expedite sanitary and phytosanitary approvals for Colombian agricultural products with preferential access to the US market under the 2012 US-Colombia Trade Promotion Agreement (TPA). Creating a market in the United States for agricultural products apt for production in conflict-afflicted territories would support US-Colombia crop-substitution and coca-eradication efforts.

A more robust social pact: Promoting greater stability

8. Prioritize, finance, and expand US Agency for International Development (USAID)-led programs to support women, Afro-Colombians, Indigenous people, and youths in Colombia.

9. Explore increasing funding needs to support Colombia’s efforts to assist and promote the socioeconomic inclusion of the nearly two million Venezuelan migrants and refugees in its territory.

10. Encourage international donors to fully fund donation pledges and increase financial support in response to the Venezuela regional crisis.

11. The US embassy and USAID mission in Colombia, in partnership with multilateral agencies, should provide technical assistance to Colombia’s National Planning Directorate (DNP) to improve its beneficiary databases and payment-dispersion systems, thereby ensuring that COVID-driven and pre-COVID subsidies effectively reach those in need.

12. Support the modernization of Colombia’ tax and customs agency (DIAN) through an Internal Revenue Service (IRS) program of assistance and/or technology collaboration to improve trade traceability and increase the digitalization of customs processes. A stronger DIAN is key to fighting money laundering and smuggling schemes.

Enhancing rule of law, peace-agreement implementation, good governance, and human-rights protections

13. Convene a binational task force to inform the future allocation of US resources to stabilize conflict-affected territories, focusing specifically on

  1. producing a comprehensive evaluation of the status and results of key ongoing and US-backed stabilization programs;
  2. assessing the degree of interconnectedness between existing stabilization efforts at the local level, and proposing strategies for increased coordination and unity, where needed; and
  3. defining and advancing the adoption of holistic success metrics for territorial stabilization that go beyond total coca crops and cocaine production.

14. Continue to support the implementation of Colombia’s 2016 agreement by

  1. building on US-backed studies and initiatives (e.g. the Kroc Institute’s Peace Accord’s Matrix) to determine the need for additional US funding, particularly to Colombia’s most vulnerable territories—i.e., the one hundred and seventy Development Programs with a Territorial Focus (PDET) municipalities.
  2. working with other international donors to increase coordination and complementarity between different sources of funding.

15. Support changes in policies, practices, and training to reduce use-of-force incidents during police-citizen encounters and improve community trust in the Colombian police. Specifically, USAID, the Department of State, and the US Department of Defense could partner with in-country stakeholders to train police forces on human rights, de-escalation, and gender-based violence; and implement early-warning systems and new policing technologies to increase police accountability, transparency, and legitimacy.

16. Continue to financially support the Colombian Attorney General’s Office (AGO), ensuring accountability of US support through conditionality and clear monitoring mechanisms. The US Department of Justice and the State Department’s Bureau of International Narcotics and Law Enforcement Affairs (INL) should also continue to provide technical workshops and trainings to the Colombian AGO to prevent and investigate human-rights violations.

Introduction

US foreign policy actions during the Joseph Biden-Kamala Harris administration could help to define US relations with Latin America and the Caribbean for years to come. With increasing challenges in the region—including democratic backsliding, growing social dissatisfaction, the Venezuelan migrant and refugee crisis, and the fallout from COVID-19—the United States should reinvigorate its relationships with partners and allies to promote hemispheric stability and prosperity. Strengthening US-Colombia relations should be a top priority, as the positive effects will reverberate far beyond Colombia. 

As President Biden mentioned, Colombia is the “keystone” of US foreign policy toward LAC.1 For decades, the US-Colombia partnership has safeguarded US economic, political, security, and humanitarian interests in the wider region, and supported Colombia’s path toward greater peace, security, and well-being. 

However, recent challenges caused or aggravated by COVID-19 threaten Colombia’s internal stability and democratic institutions, and may lead to unwanted spillovers across the region. Jointly addressing these challenges is critical for the continuity of Colombia’s democracy, security, and development gains. 

Like many other countries in LAC, Colombia was hit hard by COVID-19, in terms of both infections and deaths. The country imposed strict lockdowns and mobility restrictions to curb transmissions, which hindered economic activity and led to one of the worst recessions on record. In 2020, Colombia’s economy contracted by nearly seven percentage points, while unemployment surpassed 21 percent. Poverty increased from 35.7 percent in 2019 to 42.5 percent in 2020, reversing progress in poverty reduction by almost ten years. In a matter of months, 3.5 million new Colombians entered poverty, of whom 2.8 million fell into extreme poverty.2

These economic setbacks, coupled with preexisting social grievances—inefficient public services, perceived inadequacies in the implementation of the 2016 peace agreement, unfulfilled government promises to vulnerable and historically marginalized communities, corruption, violence, and organized crime—–fueled a wave of mass protests in early 2021. Although largely peaceful, some demonstrations were intensified by police use of force, and permeated by criminal activities, vandalism, and blockades, causing more than eighty deaths and $1.5 billion in economic losses.3

Support for sustainable and inclusive COVID-19 recovery in Colombia is critical to sustain the country’s success, and to demonstrate the United States’ commitment to democracy, social justice and the US-Colombia alliance. Now is the time to build on more than two decades of successful US-Colombia partnership and devote new resources to ensure that previous investments can remain the foundation for the future.

The Atlantic Council US-Colombia Task Force calls for a new and ambitious multiyear, bipartisan, and binational plan; one designed to both tackle immediate issues facing Colombia and the region—COVID-19, the Venezuela crisis, rising human-rights concerns, and others—and to promote long-term prosperity, democracy, social inclusion, and equitable wealth creation in Colombia. This will help to address the conditions that spark social and political unrest, boosting Colombia’s contributions to regional stability and role as one of the United States’ strongest global partners. This report outlines some of the strategies that such a plan should include. 

A historically successful partnership

During his October 2021 trip to Colombia, US Secretary of State Antony Blinken said that the US-Colombia relationship “transcends any administration or any political party” and continually evolves to become progressively stronger.4 According to Secretary Blinken, democracies deliver “by working closely with partners and allies on the biggest challenges we face. And that’s exactly what the United States and Colombia are doing.”5

Sustaining and expanding such an alliance will help to address many global needs, generating positive impacts on the lives of US, Colombian, and other regional citizens. With nearly two hundred years of bilateral relations and two decades of partnership under the Plan Colombia framework, the following examples demonstrate Colombia’s position as one of the most willing and capable US allies in the world and the Western Hemisphere.  

Under Plan Colombia and Peace Colombia, both countries forged an enduring security and counternarcotics partnership, which built toward the signing of Colombia’s 2016 peace accord. Between 2000 and 2015, Colombia spent more than $130 billion to reduce coca crops, fight drug trafficking, strengthen its institutions, and combat illegal armed groups.6 Since 2000, the United States has invested nearly $12 billion to support Colombia’s efforts to enhance security, create economic opportunities, and build effective and legitimate state institutions.7 Despite these efforts, in 2020 coca cultivation and cocaine production reached record expansion of 245,000 hectares and 1,010 metric tons, respectively.8 Without enhanced bilateral cooperation, these issues could hinder Colombia’s capacity to strengthen governance and transition to sustainable peace.  

Colombia’s efforts to take in and assist nearly two million Venezuelan migrants and refugees points to its growing capacity for regional leadership. In February 2021, the government offered a decade of Temporary Protected Status (TPS) to conflict-affected Venezuelans, granting them access to formal employment and essential services including healthcare and COVID-19 vaccinations. Colombia also offered to host more than four thousand Afghan refugees following the US exit from Afghanistan, sent sixteen tons of critical humanitarian aid and thirty rescue workers to Haiti after the August 2021 earthquake, and donated $1 million to the Caribbean community (CARICOM) via the Pan American Health Organization (PHO) to support vaccination efforts.9 

As an important US ally at the United Nations (UN), Organization of American States (OAS), and Organisation for Economic Co-operation and Development (OECD), Colombia has become a vital contributor of security expertise and a promotor of democratic institutions, rule of law, and economic liberty across the world. In Central America specifically, Colombia has cooperated with the United States to train more than seventeen thousand police and prosecutors via the US-Colombia Action Plan since 2013.10 Colombia was the first Latin American country to become one of the North Atlantic Treaty Organization’s (NATO) nine global partners.11 By providing critical demining expertise and training to NATO allies and partners, Colombia has aided the global fight against terrorism, cybersecurity threats, corruption, and other global security challenges. 

The strong economic relationship between the United States and Colombia should continue to prioritize foreign direct investment (FDI) and the full implementation of the 2012 US-Colombia TPA. The United States is currently Colombia’s largest trading partner, and Colombia remains one of the few South American countries that trades more with the United States than with China. As China’s economic engagement in the region continues to increase, a more robust US-Colombia economic partnership could help to balance out China’s growing involvement and investments in LAC.

Widespread dissatisfaction with democracy in LAC has placed democratic institutions under threat, particularly with extra-hemispheric powers like China increasingly promoting their form of government as more stable and productive than the liberal open-market democratic model. These circumstances make Colombia’s 2022 presidential and congressional elections high stakes for the future of US-LAC relations, and grant greater importance to US support of Colombia’s efforts to strengthen national democratic institutions.

Similarly, Colombia’s prompt and sustainable COVID-19 recovery is critical for political and social stability at home and in the region. The United States should position itself as Colombia’s partner of choice in its post-pandemic recovery to address challenges and reinforce the “wins” of a strong relationship for years to come.

U.S. Secretary of State Antony Blinken meets with Colombian Vice President and Foreign Minister, Marta Lucia Ramirez, at the U.S. State Department in Washington, DC, U.S. May 28, 2021. Andrew Caballero-Reynolds/Pool via REUTERS

A flour-pillar plan for post-COVID-19 recovery win Colombia

The COVID-19 pandemic led to the most severe economic recession in Colombia in more than a century. As previously noted, the country’s economy contracted by 6.8 percent in 2020 and poverty and unemployment rates skyrocketed, reaching nearly 43 percent and 21 percent, respectively. Colombia’s structural social and economic challenges became even more evident as labor informality, the inefficient provision of public goods, infrastructure bottlenecks, and weak local governance hampered social and economic recovery.

As the administration of President Joe Biden supports COVID-19 recovery in LAC and works to reinvigorate and modernize US alliances in the region, the US-Colombia partnership should be top priority. 

The United States should: help to restore economic activity by building on previous commitments to provide COVID-19 vaccines to Colombia; promote investment and job creation in Colombia in partnership with international financial institutions like the Inter-American Development Bank (IDB), DFC, and USAID to consolidate free markets and productivity as the engines for sustainable growth; provide increased and strategic technical and financial assistance to ensure Colombia’s social and political stability; and strengthen existing initiatives to boost security conditions, state capacity, and rule of law. The four strategic pillars are outlined below.

Pillar one

Vaccine rollout: Jump-starting the economy

In 2020 and 2021, Colombia implemented strict quarantine and mobility restrictions to contain the spread of COVID-19 and prevent the collapse of the healthcare system. However, given Colombia’s high informal- employment rates (nearly 63 percent of the working population), staying at home was not viable for many low-income or vulnerable households.12 Thus, lockdown measures proved unsustainable and contributed to increased poverty, inequality, and social discontent.  

Colombia’s COVID-19 vaccination campaign launched in February 2021, relatively late in comparison to its regional peers. As of October 20, the program has had strong results, with 43.8 percent of the population fully vaccinated according to the Health Ministry. Assuming every person needs two vaccine doses.13 Despite large strides to ensure equitable in-country vaccine distribution, vaccination rates still vary across regions. Data from July 2021 reveal that, on average, vaccine coverage is lower in rural municipalities (25 percent) and remote rural municipalities (23 percent) than in large cities (30 percent).14 Nevertheless, coverage varies considerably from department to department, with rural municipalities in certain regions (e.g., Valle del Cauca, Santander, and Atlántico) actually doing better than cities.  

The pace of Colombia’s vaccination program has been influenced almost entirely by inventory issues, rather than infrastructure, distribution, or administration capacity. With a population of more than fifty million, Colombia has contracted seventy-six million vaccines through multilateral and bilateral channels, but only 52.5 million have been delivered.15 The continuous flow of vaccines is critical for the application of booster shots, immunization of Venezuelan migrants and refugees, and the achievement of widespread vaccination among vulnerable and historically marginalized communities, particularly in remote rural areas.

The United States is the only producing nation that has made direct bilateral donations to Colombia, providing a total of six million doses as of October 16, 2021 (2.5 million from Johnson & Johnson and 3.5 million from Moderna), enough to fully vaccinate approximately 10 percent of Colombia’s eligible population.16  

Despite these advances, supply shortages and delays in delivery schedules keep vaccine rollout slow. Nearly 22 percent of remaining deliveries (approximately 16.5 million doses) will be received via the COVAX Facility, a consortium backed by the World Health Organization (WHO). While the initiative works to ensure the equitable distribution of vaccines, deliveries have been slow, and uncertainty about future deliveries remains high. 

Recommendations for an effective US-Colombia partnership

The US-Colombia Task Force welcomes the commitment of the United States to providing COVID-19 vaccines globally, including to Colombia and other LAC countries, bilaterally and through multilateral mechanisms.

The United States can send additional bilateral vaccine donations to Colombia. Direct donations would circumvent delivery and supply problems currently faced by COVAX, ensuring timely and equitable vaccine access for Colombians, particularly to rural communities, and the nearly two million Venezuelan migrants and refugees on Colombian soil. The United States could allocate vaccines for Venezuela (which currently receives no US COVID-19 vaccines) and provide them to Colombia to distribute in localities with a large Venezuelan presence, reaching Colombians and a greater number of migrants and refugees.

Colombian women organize bouquets of flowers to be exported overseas ahead of Valentine’s Day. The United States is a leading importer of Colombian flowers. (Reuters/Jaime Saldarriaga)
Pillar two

Job creation: The path to inclusive growth

The massive and sudden job loss in Colombia remains one of the most dramatic effects of the pandemic-driven economic downturn. In May 2021, unemployment peaked at 20.9 percent and, despite declining to 12.1 percent in September 2021, remains above its pre-pandemic levels (10.5 percent in 2019).17 In the first three months of the COVID-19 crisis, five million jobs were lost—and six hundred and eighty thousand have yet to be restored as of September 2021. To date, employment recovery has mainly occurred in the informal sector. Millions of Colombians continue to lack access to social-security services or social-welfare programs amid a global health and economic crisis. Also, as shown in the figure below, Colombia’s job loss has disproportionately affected women, given their high participation rate in the sectors hit hardest by COVID-19 (tourism, restaurants, and services in general). 

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Source: “Información Septiembre 2021,” Departamento Administrativo Nacional de Estadística, September 2021, https://www.dane.gov.co/index.php/estadisticas-por-tema/mercado-laboral/empleo-y-desempleo.  

To address the impact of COVID-19 on people’s livelihoods, the Colombian government implemented cash-transfer programs for low-income families and credit guarantees for companies. These initiatives involved a $6.5-billion fiscal effort between March 2020 and June 2021.18 Cash transfers to individuals and corporate payroll subsidies will run until the end of 2022 and 2021, respectively. 

Recent estimates suggest that these programs have prevented a 2.2-percentage-point surge in poverty.19 However, their longevity relies on the DNP’s ability to improve beneficiary databases and payment systems, to ensure the swift delivery of government funds and the careful assessment of future fiscal burdens.  

In the medium and long terms, a sustainable improvement in people’s livelihoods and well-being will result from the promotion of inclusive economic growth through new employment opportunities, rather than government transfers. The creation of millions of new jobs will require efforts in the following three areas.

Large-scale infrastructure projects: Colombia must prioritize projects that have a material impact on gross capital formation and positive spillovers into other sectors. Given current fiscal constraints, Colombia has encouraged private-sector participation in said projects via public-private partnerships (PPP) like the fifth-generation (5G) plan to develop roads, airports, trains, and waterways infrastructure, which contemplates an investment of $4.8 billion over the next decade.20 Focusing efforts on infrastructure projects that benefit PDET (i.e., municipalities classified as specially affected by violence) can provide significant benefits in the short and long terms. Similarly, the Build Back Better World (B3W) Initiative, designed to meet the infrastructure needs of developing countries, serves as an opportunity to advance collaboration with the DFC to create additional infrastructure/construction related jobs.

Housing-construction programs: Colombia has a housing deficit of approximately 5.1 million units, making housing a promising sector to attract public and private investment.21 Historically, Colombia has used housing development as a countercyclical policy, due to its quick positive impact on employment and aggregate demand.

Tourism and services: The COVID-19 pandemic generated a sharp downturn in tourism activities, leading to the loss of more than 76 percent of jobs in Colombia’s retail, entertainment, restaurant and food service, and hotel industries.22 As international travel restrictions start to ease, promoting the tourism industry will allow Colombia to recover millions of jobs, generate additional employment opportunities, and return to pre-pandemic positive growth trends. Stimulating the service and tourism sectors can contribute to rapid job recovery and income gains among low- and middle-class workers, particularly women and young workers, given that said sectors do not require specialized skillsets or trainings. 

Nearshoring: Opportunities for nearshoring in LAC continue to grow as businesses increasingly consider relocating operations closer to their main markets. In addition to strengthening supply-chain resiliency, nearshoring could help to advance socially equitable production standards.23 The McKinsey Global Institute identified $4.6 trillion in global nearshoring opportunities over the next five years.24 Given its proximity to the United States and other LAC markets, Colombia is uniquely positioned to receive nearshoring investments from US companies looking to divest from Asia to reduce risks of future trade wars or other disruptive events like COVID-19. Colombia’s Commerce Ministry, with the support of the Colombian American Chamber of Commerce (AmCham), identified nearly six hundred companies across several sectors in which nearshoring to Colombia would provide competitive advantages, including processed foods, petrochemicals, pharmaceuticals, information technologies, and fashion, among others.25 Moving forward, ProColombia, the government agency responsible for promoting exports and FDI, should continue to work with US companies to identify and reduce existing legal, tax, and regulatory burdens to FDI in these sectors. Also, the Ministry of Education could scale up bilingual-education programs to make Colombia a more attractive relocation destination for US companies. 

Recommendations for an effective US-Colombia partnership

The US government can support Colombia’s long-term growth by creating a more robust private-sector engagement plan that allows US investors and companies to tap the full potential of investment opportunities in Colombia.

The DFC should play a critical role in such a plan. Despite being well positioned to mobilize US private-sector investment in Colombia, the DFC has not met initial expectations due to the slow start of its US-Colombia Growth Initiative, an ambitious plan launched in August 2020 to attract $5 billion in investments in Colombia.26 To fully implement the initiative, the DFC should work with the US Congress to determine the need and explore ways to increase the budget for equity investments, as well as technical assistance and feasibility studies. Additional budget for equity investments would allow the agency to support more growth-stage companies in Colombia, which would otherwise not be able to take on debt, promoting inclusive development and advancing US foreign policy goals. Similarly, increasing the budget for feasibility studies, technical assistance, or trainings would accelerate project identification and preparation, increasing their developmental impact or commercial sustainability, and attracting additional private investment.

Moreover, for projects in which its capabilities are limited, DFC should consider partnering with multilaterals—such as the IDB, IFC, and/or other organizations in which the United States is a shareholder—to share due-diligence responsibilities, while leveraging their extensive knowledge, track records, and networks in Colombia.

In parallel, the United States and/or Colombia could assess the feasibility of adopting additional credit-guarantee schemes (CGSs) to unlock lending for SMEs and promote inclusive economic growth. Under a CGS, the government fully or partially guarantees the value of a loan to an SME, which mitigates the risk to the lender, incentivizing financial institutions to increase access to credit to a broader client base. Specifically, the United States could replicate and/or expand USAID/Colombia’s Development Credit Authority (DCA) portfolio to support lending to SMEs in more municipalities across Colombia. As of July 2021, the DCA has leveraged $55 in private-sector financing for every dollar in USAID funds obligated, for a total of $337 million since 2008.27 Additional CSGs could prioritize access to financing for local infrastructure projects and projects in the tourism and service sectors, given their potential to rapidly generate jobs that directly benefit women, Afro-Colombians, Indigenous peoples, and youths.

In addition to working with Colombia’s national government, the DFC could engage key stakeholders (public sector, private sector, and civil society) in large cities (e.g., Barranquilla, Bogotá, Cali, and Medellin) and in localities with high unemployment rates (e.g., Cúcuta, Neiva, Quibdó, Riohacha, and Valledupar) to identify and structure commercially sustainable projects that attract additional private investments in development and promote job creation. The US Treasury, State Department, USTDA, USDOT, and DOE could support these efforts by working with the DFC to structure projects alongside relevant subject-matter experts. Engagement at the city and/or municipality levels will also show the United States’ commitment to work nationwide and allow agencies to navigate federal government changes following Colombia’s 2022 presidential election.

The US and Colombian governments should also incentivize US private-sector participation in Colombia´s large infrastructure projects, which is currently very low. For example, no US company has made a bid for any of Colombia’s thirty large road PPP projects awarded in the past six years; instead, the projects were awarded to companies from other countries, including China. To address this and incentivize future investment, the US Department of Treasury and USTDA should work with industry-leading firms in the United States to identify barriers that inhibit US players from committing their capital or financing to these projects, and make proposals to Colombia’s ANI on how to address them. Existing barriers might be related to structuring issues, the balance of risks faced by private players, broader contract clauses, or security and rule-of-law concerns. Once identified, Colombian authorities should tackle these constraints to make large infrastructure projects more attractive to a greater array of US and other strategic investors.

Additionally, the United States should consider adopting a modernized version of enterprise funds as a foreign policy instrument toward Colombia and the wider region. These funds deliver US government monies to private-equity investments in emerging markets, promoting entrepreneurship abroad and generating high financial returns. With these funds’ foundation in the early 1990s, the US government invested $1.2 billion in nineteen countries. According to USAID, original funds realized approximately $1.7 billion of net proceeds from successful investments and raised $6.9 billion of private capital from outside the US government, reaching a total of $9.8 billion from all sources.28

Overall, the relative financial and policy success of enterprise funds could be scaled and replicated in Colombia and other LAC countries, albeit with modifications to meet regional demands and realities. In Colombia specifically, the United States could revisit and adjust enterprise funds based on lessons learned from USAID’s experience with the $100-million Tunisian American Enterprise Fund (TAEF). Between 2013 and 2020, the TAEF invested approximately $36.7 million to SMEs in every Tunisian governate, and it will continue to actively invest through 2028.29 A potential enterprise fund in Colombia should: adopt more flexible business plans; establish partnerships with other institutions (e.g., DFC and IFC) to attract additional resources and leverage lessons learned from non-US enterprise funds; and incorporate nongovernmental organizations to provide supplementary technical-assistance programs.

Finally, the US government should work with Colombia to prioritize and expedite the approval of Colombian products with preferential access to the US market under the 2012 US-Colombia Trade Promotion Agreement. Specifically, The US Department of Agriculture’s Animal and Plant Health Inspection Service (APHIS) could speed up and harmonize sanitary and phytosanitary requirements to facilitate and accelerate the entry of agricultural products into the United States—particularly those apt for production in areas afflicted by criminal economies, such as coca cultivation and illegal mining. Establishing a market in the United States for agricultural products that are part of coca-crop substitution programs would significantly advance licit economic opportunities in rural Colombia and US-Colombia coca-eradication efforts.30

Demonstrators take part in a protest against the tax reform of President Ivan Duque’s government in Bogota, Colombia April 28, 2021. REUTERS/Luisa Gonzalez
Pillar three

A more robust social pact: Promoting greater stability

In 2019, mass protests led by trade unions and student groups erupted across Colombia and many other LAC countries (e.g., Chile, Peru, and Ecuador), calling for improvements in health, education, pensions, and judicial systems. However, protests lost some of their saliency in 2020 due to COVID-19 and the implementation of mobility restrictions. Nevertheless, mass demonstrations broke out again in April 2021, triggered by a tax-reform plan that raised prices on basic consumer products. Lasting several months and turning violent at times, the protests led to eighty-four civilian and police deaths, $1.5 billion in economic losses, and a surge in COVID-19 cases, which exacerbated Colombia’s third COVID-19 peak and added new pressures to the healthcare system.31 

The protests are partially explained by the government’s inability to meet citizens’ expectations amid a difficult fiscal situation. As a result of these tensions, populist movements gained popularity in the political arena, threatening the potential implementation of sustainable policies that are critical for the country’s long-term growth.

Improving the existing social pact to effectively reduce poverty and inequality is essential for social and political stability. Moving forward, Colombia must ensure that subsidy spending effectively reaches those in need, particularly given that approximately 60 percent of pre-COVID-19 subsidies went to the non-poor. Additionally, the country needs to strengthen protections for the elderly, as retirement-pension coverage only benefits 25 percent of the adult population. Labor informality also remains a challenge, as nearly two thirds of the working population operates in the informal sector and lacks access to social-security services.32 The Colombian government should, among other things, continue to reduce non-wage payroll costs, such as payroll contributions to family welfare funds (cajas de compensación familiar), that hamper job creation in the formal sector. Moving from flat-rate social-security contributions to progressive rates would lower the cost of hiring minimum-wage workers for employers, and thereby incentivize formalization.33

A stronger social pact is particularly urgent given the ongoing health, economic, and social challenges brought on by COVID-19. Recent economic dislocations have disproportionately affected vulnerable populations, particularly women, Afro-Colombians, Indigenous peoples, low-skilled workers, and youths. Any state response to the pandemic and its aftermath should prioritize these groups of individuals. A more robust social pact is also paramount given the mass influx of vulnerable Venezuelans to Colombia, and the burden that ongoing migration places on Colombia’s public-goods provision and fiscal balance.

Improving the state’s social safety net amid a global health emergency inevitably implies additional costs. To finance them, Colombia approved a new tax reform in September 2021, which seeks to collect 1.4 percent of gross domestic product (GDP) in new revenues. In addition to changes to Colombia’s tax code, DIAN needs better capabilities to counter tax evasion and smuggling. This will not only strengthen public finances, but also improve rule of law and state capacity. 

Recommendations for an effective US-Colombia partnership

The US government should continue to prioritize, finance, and expand USAID-led programs to support women, youth, Afro-Colombians, and Indigenous peoples in Colombia. New initiatives should be informed by lessons learned from ongoing USAID programs in Colombia, including the recently launched FEMPOW (Mujeres Poderosas), Youth Resilience Activity, Inter-Ethnic Alliance for Peace Activity, Territories of Life Activity, and Afro-Colombian Leadership and Scholarship Program. The first program seeks to improve the lives of Colombian women by increasing their economic participation, promoting gender equality, and advancing the implementation of gender-related policies and services. The second is USAID/Colombia’s first activity focused entirely on youth, and looks to provide employment and entrepreneurship opportunities in thirty urban and rural municipalities by partnering with the private and public sectors, training centers, and chambers of commerce. The Inter-Ethnic Alliance for Peace Activity works with Indigenous and Afro-descendant community organizations to strengthen self-government structures, with a focus on food security and women and youth leadership. The Territories of Life Activity supports Indigenous organizations in the Amazon Basin to legally establish and manage Indigenous Community Conservation Areas, and the Afro-Colombian Leadership and Scholarship Program aims to increase the number of emerging ethnic minority leaders pursuing graduate studies in the United States.

Meeting the social, political, and economic costs of Venezuela’s mass migration to Colombia represents a significant challenge for President Iván Duque’s government and future administrations. The United States has provided approximately $1.9 billion in financial assistance to the Venezuelan regional crisis since 2017, more than any other country.34 However, the crisis remains largely underfunded. The United States should explore ways to increase its humanitarian and development assistance to Colombia as it responds to the needs of the nearly two million Venezuelan migrants and refugees in Colombian territory. Additional humanitarian aid is particularly needed to provide emergency food assistance, healthcare, education, protection services, and water, sanitation, and hygiene (WASH) support to Venezuelan migrants, refugees, and host communities. Additional development assistance is critical to support the implementation of the TPS program, sustain USAID’s integration centers (Centros de Integración para migrantes, refugiados, y retornados), and expand efforts to promote the long-term socioeconomic inclusion of migrants, refugees, and Colombian returnees from Venezuela.

Host countries like Colombia have received $256 per capita in international assistance for each Venezuelan migrant or refugee—less than one tenth of the $3,150 received by host countries for each Syrian refugee.35 The gap in funding is especially striking given that each crisis displaced about 5.5 million people in its first five years. If the Venezuelan Refugee and Migrant Response Plan (RMRP) for 2021 is fully met, the total amount of funding for the Venezuelan crisis would be roughly $259 per person.36 Yet, as of October 22, 2021, only 34.5 percent of the appeal has been funded ($89 per person).37

The United States should actively encourage other donors to follow through on donation pledges, increase their financial support, and maintain focus on the Venezuela regional crisis. In June 2021, Canada mobilized the international community to pledge nearly $2.4 billion in additional funding to assist crisis-affected people ($957 million in donations and $1.4 billion in credits). Direct budget support to Colombia (and other recipient countries) will help to reduce fiscal pressures, alleviate social discontent, and address the growing needs of Venezuelan migrants, refugees, and host communities.

The US embassy and USAID mission in Colombia can help to improve the effectiveness of structural and COVID-related social programs in Colombia by strengthening the core capabilities of Colombia’s DNP, which runs government information systems for the allocation of social transfers (e.g., Sisben 4.0). Such engagement could come under the umbrella of an international effort, in which multilateral agencies like the World Bank and/or the IDB provide technical assistance to improve beneficiary databases and payment-disbursement systems, and the United States provides technological capabilities to ensure that public resources in Colombia effectively reach those in need. Such an alliance should also seek to improve Colombia’s unequal pension system and its protections for the elderly.

Finally, the United States can support the modernization of the DIAN’s tax and customs information systems. A stronger DIAN will not only reduce tax evasion and improve tax collection, but will also help to fight money laundering and smuggling schemes associated with criminal groups. Specifically, the United States can provide assistance and expertise through an IRS program of secondments or job rotation, as well as technology collaboration to increase trade traceability and the digitalization of customs processes at ports and airports.

Mayerli Lopez, former FARC guerrilla, nurserywoman and signer of the peace agreement with the government of Juan Manuel Santos, stands during a visit to one of the nurseries run by former FARC guerrillas in Putumayo, Colombia August 26, 2021. Picture taken August 26, 2021. REUTERS/Luisa Gonzalez
Pillar four

Enhancing rule of law, peace agreement implementation, good governance, and human rights protections

To achieve a sustainable post-COVID recovery, Colombia must address historical deficiencies in terms of security, state presence, good governance, and human rights. These issues have governed US-Colombia relations for decades, and—despite considerable progress—much work remains to be done. Given that Colombia’s stability is key to regional security and prosperity, the United States should strengthen its support for Colombian government efforts to fully implement the 2016 peace agreement, and enhance rule of law, good governance, and human-rights protections. 

Rule of law and peace-agreement implementation: Historically, weak institutional presence and lack of economic opportunities have allowed illegal activities and armed groups to thrive in rural Colombia. The 2016 peace agreement between the Colombian government and the Revolutionary Armed Forces of Colombia (FARC) aimed to improve security, justice, land property rights, public goods, and economic opportunities in rural, conflict-torn areas of Colombia.38

Despite steady progress, the international community has expressed concerns about the pace of implementation of the agreement. According to the Kroc Institute for International Peace Studies at the University of Notre Dame, implementation in 2020 advanced slower than in previous years, due to a shift in focus from short-term commitments necessary to lay the foundations for implementation to medium- and long-term goals that require broader institutional adjustments and coordination. The Kroc Institute’s fifth status report, published in May 2021, reveals that 28 percent of the stipulations in the agreement have been fully implemented, 18 percent are on track to be implemented within the established timeline, and 54 percent have made little or no implementation progress (see Figure 2, page 16).39 

To date, point six in the six-point agreement, implementation, verification, and public endorsement, has the highest number of completed stipulations (55 percent), followed by point three, end of the conflict (49 percent).40 In contrast, point one, comprehensive rural reform, and point two, political participation, have the lowest number of fully implemented stipulations (4 and 12 percent, respectively).41 The figure below outlines the implementation status of each point in the agreement. 

Implementation status of each point in Colombia’s six-point peace agreement 

(December 2019–November 2020)

Point/implementation stage (Percentage of stipulations)Not initiatedMinimum Intermediate Completed 
Point 1 (Comprehensive rural reform)1864134
Point 2 (Political participation)34342012
Point 3 (End of the conflict)14191949
Point 4 (Solution to the problem of illicit drugs)18392617
Point 5 (Agreement regarding the victims of the conflict)20372023
Point 6 (Implementation, verification, and public endorsement)13181455

Source: “The Colombian Final Agreement in the Era of COVID-19: Institutional and Citizen Ownership is Key to Implementation,” Peace Accords Matrix Barometer Initiative and Kroc Institute for International Peace Studies, May 20, 2021, https://doi.org/10.7274/r0-cffp-qr07.

In 2020, three main challenges marked and protracted the implementation timeline of the agreement. The first was COVID-19 and government-imposed mobility restrictions to curb the spread of the virus. These not only exacerbated existing inequalities and vulnerabilities in the territories, but also hampered the advancement of community-level consultation processes. The second major challenge emerged from the insufficient allocation of financial resources toward implementation. The third challenge was the upsurge in confrontations among illegal armed groups, as well as clashes between these groups and security forces, resulting in instances of violence against human-rights defenders, social and environmental leaders, and former combatants. In some conflict-affected territories, these confrontations, coupled with the increasingly common fragmentation of illegal armed groups, also contributed to an upsurge in violence (e.g., homicides, massacres, and forced displacement) against civilians in early 2021.42

Progress on the implementation of the peace agreement, along with enhanced institutional presence and rule of law, will help to unlock the full potential of Colombia’s agricultural sector, and boost efforts to protect the environment and mitigate climate change —both key for post-COVID recovery. Despite favorable soil, climate, and geographical conditions, agricultural productivity stands at suboptimal levels, explained partially by land-tenure informality. Approximately 52 percent of Colombia’s rural properties lack formal titles, which hampers access to credit and investment in technology and long-term infrastructure. Additionally, illegal activities in Colombia’s Amazon (e.g., illicit mining, cattle raising, coca cultivation, and drug trafficking) not only exacerbate deforestation and hamper regional food production, water availability, and global efforts to reduce carbon emissions, but also fuel violence against environmental activists and fund non-state armed groups.43 USAID should continue to partner with Colombia on environmental protection and land-ownership formalization efforts, an important stipulation in the peace agreement. Colombia also needs to increase investments in irrigation and drainage systems through public and private financing and find new opportunities to integrate agricultural production into global value chains.    

Strengthening security, justice, and rule of law in large cities across Colombia is also critical to ensure a stable democracy and sustainable and inclusive post-COVID-19 recovery. Despite a decrease in overall levels of violence over the past two decades and a 70-percent drop in homicide rates between 1991 and 2019, recent upticks in violence and perceived insecurity are concerning.44 Between January and September 2021, homicide rates increased by 10 percent in comparison to 2019, with 40 percent of total homicides occurring in large cities.45 Cali experienced the highest number of cases, followed by Bogotá, Medellin, Barranquilla, and Cartagena. Security, justice, and rule of law are preconditions for private-sector investment in Colombia. 

Good governance and human rights: As previously mentioned, a wave of violence against human-rights defenders and social and environmental leaders has continued to spread across several regions. Estimates of the total number of homicides vary, but a compilation of government and civil-society sources provides a range of between 831 and 1,352 victims from 2016 to 2021.46 According to Fundación Ideas para la Paz (FIP), killings of social leaders dropped 49 percent in the first quarter of 2021, reaching the lowest levels since the implementation of the peace agreement began in 2017.47 Death threats and threats of violence, however, are on the rise—suggesting that violence continues, but has evolved in form and intensity. The FIP also reports that homicides of former combatants in reincorporation processes have not declined. In the first four months of 2021, twenty-four people in reincorporation processes were killed; one more in comparison to the same period in 2020, and seven more than in 2019.48  

Between April and June 2021, largely peaceful protests across Colombia’s largest cities converged with vandalism, arson, and property destruction, leading to violent clashes between protesters and security forces, and dozens of instances of human-rights violations, according to reporting from the international community and human-rights organizations. Instances of human-rights violations are unacceptable, and a direct threat to democracy, civil society, and peace. Addressing such situations should be a top priority for Colombia and the US-Colombia bilateral agenda. 

Recommendations for an effective US-Colombia partnership

The United States should continue to partner with Colombia to improve security and build effective and legitimate state institutions in rural and urban areas, implement the 2016 peace agreement, combat illegal armed groups and illicit drugs, and protect vulnerable populations, including human-rights defenders and social leaders

In the short term, the United States and Colombia should convene an independent binational task force with three specific mandates to inform the allocation of future US stabilization resources. First, the group should produce a comprehensive evaluation of the status and results of key ongoing and US-backed programs to promote stability in conflict-affected areas, including the Zonas Futuro, Paz con Legalidad, the PDETs, and the National Comprehensive Program for the Substitution of Crops Used for Illicit Purposes (PNIS), among others. Such an assessment will help ensure an efficient intersection between security and development in accordance with the Framework for US Stabilization developed by the US Department of State, US Department of Defense, and USAID in 2018.49 Existing and new interventions should not only promote civil security, but also deliver basic services (education, healthcare, WASH, etc.) and increase economic opportunities, supporting vulnerable and historically marginalized communities and enhancing state legitimacy.

Second, the task force should assess the degree of unity and coordination between existing stabilization programs, particularly at the subnational level, and propose improvements where needed. Ensuring effective coordination and unity between efforts and actors is critical to reduce levels of violence and consolidate stability in conflict-affected areas, which will ultimately produce more tangible and long-lasting outcomes for US taxpayers. Lastly, the group’s third mandate should be to establish and advance the adoption of more holistic metrics for bilateral success in terms of territorial stabilization. These metrics should go beyond narrow indicators of success, including total cocaine production and coca cultivated, which have historically defined US-Colombia relations.

International assistance and cooperation remain critical for the successful implementation of the 2016 peace agreement. Moving forward, the United States should continue to support Colombia’s peace-agreement implementation efforts, informing and optimizing the allocation of future US assistance based on the findings of US-backed studies and initiatives such as the Peace Accord’s Matrix at the University of Notre Dame’s Kroc Institute for International Peace Studies.

Once specific funding needs are established, the United States and Colombia could convene a conference of international donors to support peace-agreement implementation, with the participation of other donor countries (e.g., Canada, United Kingdom, and European Union countries), international financial institutions like the World Bank, IDB, and International Monetary Fund (IMF), and intergovernmental organizations like the United Nations. The conference is also an opportunity to adopt strategies to promote coordination and complementarity between different sources of funding. Additional resources and efforts resulting from this initiative should be directed to Colombia’s most vulnerable territories—i.e., the sixteen PDET regions outlined in the agreement, which comprise one hundred and seventy municipalities.

The United States should work with Colombia to implement changes in police policies, practices, and trainings to reduce use-of-force incidents and improve community trust in the police. Section 660 of the Foreign Assistance Act permits US agencies to provide training in internationally recognized standards of human rights, rule of law, anti-corruption, and the promotion of civilian police roles that support democracy. In Colombia, USAID, the Department of State, and Department of Defense are well positioned to partner with in-country stakeholders (the private sector, academia, and civil society) to train the Colombian National Police on human rights, de-escalation techniques, and gender-based violence.50 These programs should build on prior US police/military trainings in Colombia and leverage lessons learned from US police trainings on human rights in Central America (2018) and gender-based-violence prevention in the Dominican Republic (2021).51

USAID, the State Department, and the Defense Department could also support the efforts of the Office of Human Rights within the Colombian National Police, created in July 2021 and led by a former US State Department consultant, to inform police policies on the prevention, reduction, and respect for human rights. Additionally, US agencies could support the implementation of early-intervention systems to detect and address officer misconduct and strengthen accountability and human-rights protections—as well as the adoption of innovative technologies in policing to increase accountability and transparency and rebuild perceptions of police legitimacy and trust in Colombia.

The United States should continue to financially support the Colombian Attorney General’s Office (AGO) with conditionality and clear monitoring mechanisms to ensure that US resources are effectively used in resolving and preventing human-rights violations. Also, the US Department of Justice—via its International Criminal Investigative Training Assistance Program (ICITAP), and in coordination with the State Department’s Bureau of International Narcotics and Law Enforcement Affairs (INL)—should continue to provide technical workshops and trainings to the Colombian AGO to investigate human-rights violations, as well as including it as a key stakeholder in transnational criminal investigations.

Conclusion

With more than two decades of successful cooperation, Colombia stands as one of the United States’ closest and most capable allies in the region. Strengthening this strategic relationship and supporting Colombia’s COVID-19 recovery will significantly advance regional stability amid increasing global challenges. 

To foster inclusive and sustainable COVID-19 recovery in Colombia, the US-Colombia partnership should accelerate vaccine rollout, promote investment and job creation, address social and political tensions, and enhance security, state capacity, rule of law, and human-rights protections. 

A steady stream of vaccines to Colombia supported by the United States will contribute to the immunization and COVID-19 recovery of Venezuelan migrants and refugees, as well as vulnerable and historically marginalized communities, particularly in remote rural areas. It will also allow Colombia to address other pressing issues including social discontent, public debt, and fiscal deficits. Promoting US investment and job-creation creation will accelerate Colombia’s economic recovery, decrease the strain on social-security services and programs, and stimulate entrepreneurship and small-to-medium business growth. By supporting the expansion of programs to support women, Afro-Colombians, Indigenous peoples, migrants, refugees, and youth, the US-Colombia partnership will address preexisting grievances and promote long-term stability. Finally, aiding in Colombia’s efforts to stabilize conflict-affected territories and fully implement the 2016 peace agreement, will reinforce state legitimacy, rule of law, good governance, and human-rights protections.

A medical worker prepares an injection with a dose of the Pfizer-BioNTech COVID-19 vaccine at the Colombia Clinic in Bogota, Colombia February 18, 2021. REUTERS/Luisa Gonzalez

Acknowledgements

About the US-Colombia Task Force

This is the third report of the Atlantic Council US-Colombia Task Force, a high-level group of policymakers, business leaders, and civil-society representatives in the United States and Colombia co-chaired by Senator Ben Cardin (D-MD) and Senator Roy Blunt (R-MO). In addition to bipartisan leadership, the group includes a bipartisan membership from the US House of Representatives: Foreign Affairs Committee Chairman Gregory Meeks (D-NY), Representative Dan Crenshaw (R-TX), and Representative Ruben Gallego (D-AZ). 

Since its foundation in 2017, the US-Colombia Task Force has worked to strengthen economic and diplomatic ties between the United States and Colombia. Its first report, published in 2017, developed a roadmap for US engagement with Colombia following the 2016 peace agreement. The second, launched in 2019, provided a comprehensive assessment of US-Colombia relations, creating a modernized plan for the bilateral relationship. 

Task Force members who have decided to have their names associated with this report are listed below.

About the writers

Camila Hernandez is assistant director at the Atlantic Council’s Adrienne Arsht Latin America Center, where she leads the center’s work on Mexico, Colombia, and the US-Colombia Task Force. She has co-authored and edited reports on the US-Colombia strategic partnership and Colombia’s energy future. Camila provides regular commentary on political and economic issues affecting US relations with Latin America and the Caribbean to major media outlets in Colombia and the United States. Prior to joining the Atlantic Council, she worked at the World Resources Institute and Human Rights Watch. She holds a bachelor’s degree in government and economics from Georgetown University. Originally from Colombia, Camila is a native Spanish and English speaker, and is fluent in French.

Michel Janna is the president of AMV Colombia, the self-regulating organization for securities and foreign-exchange markets in Colombia. He has more than twenty years of experience in both public- and private-sector positions related to Latin American economic and financial issues. Janna has served as general director of public credit at the National Treasury of Colombia; as vice president of risk management and advisory for sovereigns at Goldman Sachs, New York; as chief financial officer (CFO) of Cenit, a company of the Ecopetrol Group, the largest corporate in Colombia; and as a financial-stability specialist at the Central Bank of Colombia. He has been a member of the board of directors of several corporates and financial institutions. He holds a PhD in economics from Northwestern University, and a master’s and bachelor’s degree in economics from Universidad de los Andes.

About the Center director

Jason Marczak is the director of the Atlantic Council’s Adrienne Arsht Latin America Center, joining the center in 2013 for its launch. He has more than twenty years of expertise in regional economics, politics, and development, working with policymakers and private-sector leaders to shape public policy. Marczak has also been an adjunct professor at the George Washington University’s Elliott School of International Affairs since 2016. Among his previous positions, he served as director of policy at Americas Society/Council of the Americas in New York City and co-founder of Americas Quarterly magazine. Marczak is a frequent English- and Spanish-language contributor to major media outlets, and a sought-after speaker, and has testified before the US Congress on key regional developments. He holds a bachelor’s degree from Tufts University and a master’s degree in international affairs and economics from the Johns Hopkins University Paul Nitze School of Advanced International Studies.

US-Colombia Task Force

Co-Chairs

The Hon. Ben Cardin
US Senator (D-MD)
US Congress

The Hon. Roy Blunt
US Senator (R-MO)
US Congress

Special Members

The Hon. Gregory Meeks
US Representative (D-NY)
US Congress

The Hon. Dan Crenshaw
US Representative (R-TX)
US Congress

The Hon. Ruben Gallego
US Representative (D-AZ)

US Congress

Director

Jason Marczak
Director, Adrienne Arsht Latin
America Center
Atlantic Council

Coordinator

Camila Hernández
Assistant Director, Adrienne Arsht
Latin America Center

Atlantic Council

Members

Amb. William Brownfield

Former Assistant Secretary of State for International Narcotics and Law Enforcement Affairs (2011-2018), US Department of State; Former US Ambassador to Colombia (2007-2010), Venezuela (2004-2007), and Chile (2002-2004); Non-resident Senior Adviser, Americas Program
Center for Strategic and International Studies

Min. Mauricio Cárdenas

Former Minister of Finance and Public Credit (2012 – 2018); former Minister of Mines and Energy (2011 – 2012); Adrienne Arsht Latin America Center Advisory Council Member
Republic of Colombia

Ms. Catalina Escobar Restrepo

Founder and President
Fundación JuanFe

Ms. Muni Jensen

Senior Advisor
Albright Stonebridge Group

Min. María Claudia Lacouture

Former Minister of Commerce, Industry, and Tourism (2016- 2017), Republic of Colombia; Executive Director
AmCham Colombia

Ms. Maria Victoria Llorente

Executive Director
Fundación Ideas para la Paz

Mr. Bruce Mac Master

President
Asociación Nacional de Empresarios de Colombia (ANDI)

Mr. Michael Shifter

President
The Inter-American Dialogue

Dr. Arturo Valenzuela

Former US Assistant Secretary of State for the Western Hemisphere (2009-2011); US Department of State; Former Special Assistant to the President and Senior Director for the Western Hemisphere, National Security Council (1999-2000); Emeritus Professor of Government
Georgetown University

Amb. Kevin Whitaker

Former US Ambassador to Colombia (2014 -2019) former Deputy Assistant Secretary of State for South America, Western Hemisphere Affairs
US Department of State

Mr. Felipe Ardila

Principal
Tinello Capital

Dr. Cindy Arnson

Director, Latin America Program
Woodrow Wilson International Center for Scholars

Amb. P. Michael McKinley

Former US Ambassador to Brazil (2017-2018), Afghanistan (2014-2016), Colombia (2010-2013), and Peru (2007-2010); Senior Counselor
The Cohen Group

Mr. Luis Fernando Mejía

Former Minister of Planning (2017-2018), Republic of Colombia; Executive Director
Fedesarrollo

Mr. Alejandro Mesa

Partner
BakerMcKenzie

Amb. Roger Noriega

Former US Assistant Secretary of State for the Western Hemisphere (2003-2005), US Department of State; former US Ambassador to the Organization of American States (2001-2003)

Amb. Anne Patterson

Former US Ambassador to Egypt (2011-2013), Pakistan (2007- 2010), the United Nations (2005), Colombia (2000-2003) and El Salvador (1997-2000)

Ms. Kristie Pellecchia

Former Senior Advisor for Western Hemisphere, United States International Development Finance Corporation (DFC); Principal
Pellecchia International

Mr. Alejandro Santo Domingo

President
Grupo Santo Domingo

Mr. Rand Beers

Former Acting Secretary of Homeland Security (2013)
US Department of Homeland Security

Amb. Marlene Fernandez

Former Ambassador of Bolivia to Italy (2003 – 2004) and to the United States (1999-2002); Vice President Government Relations
Arcos Dorados- McDonald’s Latin America

Mr. Juan Esteban Orduz

President
Colombian Coffee Federation – North America Subsidiary of the National Federation of Coffee Growers of Colombia

Mr. Stephen Donehoo

Managing Partner
McLarty Associates

Mr. Andrés Cadena

Senior Partner
McKinsey&Company

Acknowledgements

We would like to thank Adrienne Arsht for her generous support, without which the work of the US-Colombia Task Force would not be possible. A special thanks to Senator Cardin (D-MD) and Senator Blunt (R-MO) for their bipartisan leadership as co-chairs of the group. Our thanks, as well, to Chairman Gregory Meeks (D-NY), Representative Dan Crenshaw (R-TX), and Representative Ruben Gallego (D-AZ) for their contributions to the report and commitment to strengthening US-Colombia relations.   

Thank you to task force members for their expertise, ideas, and dedication, evident throughout the report. 

We would also like to thank Ignacia Ulloa and Willow Fortunoff for their research and writing contributions; Andrea Trujillo for her valuable inputs; Susan Cavan and Jeff Fleischer for editorial assistance; Donald Partyka for design support; and Carolina Urdaneta for translation services. Finally, a special thank you to Alyssa Anderson, Carol Brey, Daniel Burgess, Jose Contreras, Kenneth Depew, Richard Eddings, Sophia Lafargue, Tom Melia, Amanda Peper, Habiba Shebita, Michelle Shevin-Coetzee, Hannah Schwartz, and Debbie Yamanda for facilitating the unwavering cooperation of our task force co-chairs and House members.

1    Joe Biden, “‘Reconstrucción de Alianza con Colombia Será Una de Mis Prioridades,’” Tiempo, October 7, 2020, https://www.eltiempo.com/mundo/eeuu-y-canada/elecciones-en-estados-unidos-que-dice-joe-biden-sobre-colombia-541912.
2    José Manuel Restrepo Abondano, “Marco Fiscal de Mediano Plazo,” Ministerio De Hacienda y Crédito Público, July 21, 2021, https://www.minhacienda.gov.co/webcenter/ShowProperty?nodeId=%2FConexionContent%2FWCC_CLUSTER-165808%2F%2FidcPrimaryFile&revision=latestreleased.
3    “Listado de las 80 Víctimas de Violencia Homicida en el Marco del Paro Nacional al 23 de Julio,” INDEPAZ, last updated July 23, 2021, http://www.indepaz.org.co/victimas-de-violencia-homicida-en-el-marco-del-paro-nacional/ ; Luis Fernando Mejía, “Tendencia Económica Editorial: Costos Económicos del Paro Nacional,” Fundación para la Educación Superior y el Desarrollo, June 2021, http://dams.fedesarrollo.org.co/tendenciaeconomica/publicaciones/217-junio-2021/
4    “Secretary Antony J. Blinken Remarks at the U.S.-Colombia High-Level Dialogue,” US Department of State, October 21, 2021, https://www.state.gov/secretary-antony-j-blinken-remarks-at-the-u-s-colombia-high-level-dialogue/
5    Ibid.
6    “Plan Colombia: Balance de los 15 Años, Departamento Nacional de Planeación, 2015,  https://sinergia.dnp.gov.co/Documentos%20de%20Interes/PLAN_COLOMBIA_Boletin_180216.pdf.
8    “UPDATED: ONDCP Releases Data on Coca Cultivation and Potential Cocaine Production in the Andean Region,” White House, press release, July 16, 2021, https://www.whitehouse.gov/ondcp/briefing-room/2021/07/16/ondcp-releases-data-on-coca-cultivation-and-potential-cocaine-production-in-the-andean-region/.
9    “Colombia Sends to Haiti 16 Tons of Humanitarian Aid Following Devastating Earthquake,” Embassy of Colombia in the United States, August 16, 2021, https://www.colombiaemb.org/post/colombia-sends-to-haiti-16-tons-of-humanitarian-aid-and-30-rescue-workers-following-devastating-eart; “Colombia Dona un Millón de Dólares para Vacunación en Países del CARICOM,” Ministerio de Relaciones Exteriores de Colombia, July 21, 2021, https://www.cancilleria.gov.co/newsroom/news/colombia-dona-millon-dolares-vacunacion-paises-caricom.
10    “Bureau of International Narcotics and Law Enforcement Affairs: Colombia Summary—United States Department of State,” US Department of State, March 1, 2021, https://www.state.gov/bureau-of-international-narcotics-and-law-enforcement-affairs-work-by-country/colombia-summary/.
11    “Relations with Colombia,” North Atlantic Treaty Organization, last updated June 17, 2021, https://www.nato.int/cps/en/natohq/topics_143936.htm.
12    Luis Fernando Mejía, et. al., “Rigideces del Mercado Laboral en Colombia: Tendencias, Perspectivas y Recomendaciones,” in Descifrar El Futuro: La Economía Colombiana en los Próximos Diez Años, Fedesarrollo, (Penguin Random House, April, 2021), p.261-319 ; Jorge Alvarez and Carlo Pizzinelli, “COVID-19 and the Informality-Driven Recovery: The Case of Colombia’s Labor Market,” International Monetary Fund, September 2021, https://www.imf.org/en/Publications/WP/Issues/2021/09/17/COVID-19-and-the-Informality-driven-Recovery-The-Case-of-Colombia-s-Labor-Market-465831.
13    “Vacunación contra COVID-19,” Ministerio de Salud y Protección Social, last accessed October 19, 2021, https://www.minsalud.gov.co/salud/publica/Vacunacion/Paginas/Vacunacion-covid-19.aspx.
15    “¿Cuántas Vacunas Contra COVID-19 han Llegado a Colombia?” Vacunación en Colombia, last updated October 6, 2021, https://vacunacoronavirus.canalinstitucional.tv/cuantas-vacunas-han-llegado-colombia.
16    U.S. International COVID-19 Vaccine Donations Tracker—Updated as of October 16,” KFF Global Health Policy, last updated October 16, 2021, https://www.kff.org/global-health-policy/issue-brief/u-s-international-covid-19-vaccine-donations-tracker/#recipient-country.
17    “Información Agosto 2021,” Departamento Administrativo Nacional de Estadística, August 2021, https://www.dane.gov.co/index.php/estadisticas-por-tema/mercado-laboral/empleo-y-desempleo; “Principales Indicadores del Mercado Laboral,” Departamento Administrativo Nacional de Estadística, December 2019, https://www.dane.gov.co/files/investigaciones/boletines/ech/ech/bol_empleo_dic_19.pdf.
18    Jesús Antonio Bejarano Rojas, “¿Qué hay que Hacer para Lograr una Reactivación Sostenible?” Ministerio de Hacienda y Crédito Público, June 2021, https://www.anif.com.co/wp-content/uploads/2021/05/jesus-bejarano-minhacienda.pdf. COP 24.6 trillion at 3750 COP per USD.
19    Abondano, “Marco Fiscal de Mediano Plazo.”
20    Rojas, “¿Qué hay que Hacer para Lograr una Reactivación Sostenible?”
21    “Déficit Habitacional,” Departamento Administrativo Nacional de Estadística, September 2, 2021, https://www.dane.gov.co/index.php/estadisticas-por-tema/demografia-y-poblacion/deficit-habitacional.
22    “Monitoreo de Territorios Afectados por Cultivos Ilícitos 2020,” Oficina de las Naciones Unidas contra la Droga y el Delito (UNODC)-Sistema Integrado de Monitoreo de Cultivos Ilícitos (SIMCI), July 2021, https://www.unodc.org/documents/colombia/2021/Julio/Informe_Monitoreo_de_Territorios_Afectados_por_Cultivos_Ilicitos_2020.pdf.
23    Richard Feinberg, “Widening the Aperture: Nearshoring in our ‘Near-Abroad,’” Wilson Center Latin America Program, April 2021, https://www.wilsoncenter.org/sites/default/files/media/uploads/documents/WideningTheApertureNearshoringInOurNearAbroadRichardEFeinbergApril2021.pdf.
24    Susan Lund, et. al, “Risk, Resilience, and Rebalancing in Global Value Chains,” McKinsey & Company, August 6, 2020, https://www.mckinsey.com/business-functions/op%ADerations/our-insights/risk-resilience-and-re%ADbalancing-in-global-value-chains.
25    “Cincuenta Empresas del Exterior, con Interés en Colombia,” Portafolio, September 7, 2020, https://www.portafolio.co/economia/cincuenta-empresas-del-exterior-con-interes-en-colombia-544378.
26    “U.S. Government Announces Bilateral Initiative to Advance Rural Development in Colombia,” US Embassy in Colombia, August 18, 2020, https://co.usembassy.gov/u-s-government-announces-bilateral-initiative-to-advance-rural-development-in-colombia/.
27    “Rural Finance Loan Portfolio Guarantee,” USAID, last updated July 12, 2021, https://www.usaid.gov/news-information/fact-sheets/red-rural-finance-loan-portfolio-guarantee.
28    “The Enterprise Funds in Europe and Eurasia: Successes and Lessons Learned,” USAID, September 12, 2013, https://www.usaid.gov/sites/default/files/documents/1863/EE_Enterprise_Funds-LessonsLearned.pdf.
29    “Inaugural Impact Report 2020: Executive Summary” and “What is Our Mission,” Tunisian American Enterprise Fund, 2021, https://www.taefund.org/en/mission-2/.
30    “The Untapped Potential of the US-Colombia Partnership, Atlantic Council,” September 2019, https://www.atlanticcouncil.org/in-depth-research-reports/report/untapped-potential-us-colombia-partnership/.
31    “Listado de las 80 Víctimas de Violencia Homicida en el Marco del Paro Nacional al 23 de Julio”; Mejía, “Tendencia Económica Editorial: Costos Económicos del Paro Nacional.”
32    Luis Fernando Mejía, et. al., “Rigideces del Mercado Laboral en Colombia: Tendencias, Perspectivas y Recomendaciones,” in Descifrar El Futuro: La Economía Colombiana en los Próximos Diez Años, Fedesarrollo, (Penguin Random House, April, 2021), p.261-319.
33    Miguel Benítez, et. al., “Reformas para una Colombia post-COVID 19: Hacia un Nuevo Contrato Social,” La Fundación para la Educación Superior y el Desarrollo, April 12, 2021, https://www.repository.fedesarrollo.org.co/bitstream/handle/11445/4103/Repor_Abril_2021_Mej%EDa_et_al.pdf?sequence=9.
34    “United States Announces Additional Humanitarian and Development Assistance for People Affected by The Ongoing Crisis in Venezuela and the Region,” USAID, press release, September 22, 2021, https://www.usaid.gov/news-information/press-releases/sep-22-2021-us-announces-additional-humanitarian-assistance-venezuela
35    Dany Bahar and Meagan Dooley, “Venezuelan Refugees and Their Receiving Communities Need Funding, Not Sympathy,” Brookings, updated February 2021, https://www.brookings.edu/blog/up-front/2021/02/26/venezuelan-refugees-and-their-receiving-communities-need-funding-not-sympathy/; The Untapped Potential of the US-Colombia Partnership.
36    “Funding Update—RMRP,” Plataforma de Coordinación Internagencial para Refugiados y Migrantes de Venezuela, last updated October 1, 2021, https://www.r4v.info/es/financiamiento. Calculated using $1.44 billion total RMRP requirement for an estimated 5.4 million Venezuelan refugees.
37    Ibid.
38    The Untapped Potential of the US-Colombia Partnership
39    A total of five hundred and seventy-eight stipulations were included in the text of the peace agreement. “The Colombian Final Agreement in the Era of COVID-19: Institutional and Citizen Ownership is Key to Implementation,” Peace Accords Matrix Barometer Initiative and Kroc Institute for International Peace Studies, May 20, 2021, https://doi.org/10.7274/r0-cffp-qr07.
40    Ibid.
41    Ibid.
42    Juan Carlos Garzón Vergara, “En 2021 la Confrontación Armada Disminuye, pero la Violencia Contra Civiles Aumenta,” Fundación Ideas Para la Paz, May 28, 2021, https://www.ideaspaz.org/publications/posts/2001.
43    Juan Carlos Garzón Vergara, “Un Clima Peligroso: Deforestación, Cambio Climático y Violencia Contra los Defensores Ambientes en la Amazonía Colombiana,” Fundación Ideas Para la Paz, September 30, 2021, https://www.ideaspaz.org/publications/posts/2058.
44    “Homicidios Intencionales (por Cada 100.000 Habitantes)—Colombia,” Banco Mundial, 2018, https://datos.bancomundial.org/indicador/VC.IHR.PSRC.P5?locations=CO.
45    ¿Qué hay Detrás del Aumento de Homicidios en lo que Va del Año?” Tiempo, July 1, 2021, https://www.eltiempo.com/justicia/delitos/balance-de-homicidios-en-colombia-aumentaron-21-en-2021-600015.
46    “Defensoría del Pueblo Presenta Reporte de Conductas Vulneratorias contra Líderes Sociales Durante el Primer Semestre de 2021,” Defensoría del Pueblo Colombia, August 25, 2021, https://www.defensoria.gov.co/es/nube/comunicados/10368/Defensor%C3%ADa-del-Pueblo-presenta-reporte-de-conductas-vulneratorias-contra-l%C3%ADderes-sociales-durante-el-primer-semestre-de-2021-l%C3%ADderes-sociales-Defensor%C3%ADa-informe.htm; “Líderes Sociales, Defensores de DD.HH y Firmantes de Acuerdo Asesinados en 2021,” INDEPAZ, October 2, 2021, http://www.Indepaz.Org.Co/Lideres-sociales-y-defensores-de-derechos-humanos-asesinados-en-2021/.
47    Vergara, “En 2021 la Confrontación Armada Disminuye, pero la Violencia Contra Civiles Aumenta.”
48    Ibid. 
49    “Stabilization Assistance Review: A Framework for Maximizing the Effectiveness of U.S. Government Efforts to Stabilize Conflict-Affected Areas,” US Department of State, 2018, https://www.state.gov/reports/stabilization-assistance-review-a-framework-for-maximizing-the-effectiveness-of-u-s-government-efforts-to-stabilize-conflict-affected-areas-2018/.
50    “The Intelligence Reform and Terrorism Prevention Act of 2004,” US Department of Justice,  2004, https://bja.ojp.gov/program/it/privacy-civil-liberties/authorities/statutes/1282.
51    “Foreign Military Training Report: Fiscal Years 2018–2019,” US Department of State and US Department of Defense, 2019, https://www.state.gov/wp-content/uploads/2019/12/FMT_Volume-I_FY2018_2019.pdf#page=404;“Central American Police Training: GAO-18-618,” Government Office of Accountability, September 2018, https://www.gao.gov/assets/gao-18-618.pdf; “Standing Against Gender-Based Violence in the Dominican Republic,” US Agency for International Development, March 29, 2021, https://medium.com/usaid-2030/standing-against-gender-based-violence-in-the-dominican-republic-2a813de03711.

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Fernandes on Forbes India: Public health integration in CSR a must to reshape the post Covid-19 world https://www.atlanticcouncil.org/insight-impact/in-the-news/fernandes-on-forbes-india-public-health-integration-in-csr-a-must-to-reshape-the-post-covid-19-world/ Mon, 06 Dec 2021 09:11:00 +0000 https://www.atlanticcouncil.org/?p=465167 The post Fernandes on Forbes India: Public health integration in CSR a must to reshape the post Covid-19 world appeared first on Atlantic Council.

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Generational dynamics of economic crisis and recovery: Prospects for younger and older persons https://www.atlanticcouncil.org/in-depth-research-reports/issue-brief/generational-dynamics-of-economic-crisis-and-recovery-prospects-for-younger-and-older-persons/ Tue, 23 Nov 2021 17:30:00 +0000 https://www.atlanticcouncil.org/?p=460686 Economic shocks affect young and older age groups disproportionately and highlight the insecurity of the youth labor market and volatility of older people’s savings. The COVID-19 pandemic exacerbated youth labor market challenges and caused young people to either lose jobs or work fewer hours.

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Introduction

Economic shocks affect young and older age groups disproportionately and highlight the insecurity of the youth labor market and volatility of older people’s savings. The COVID-19 pandemic exacerbated youth labor market challenges and caused young people to either lose jobs or work fewer hours. It also undermined the financial security of older people who tend to own small businesses given that half of the small businesses either closed down or lost significant revenue during lockdowns. Furthermore, COVID-19 exacerbated the digital divide between generations. While younger people are more likely to be technologically savvy, older generations often lack digital literacy to adapt to online work or virtual communications platforms. Dr. Goldin argues that to alleviate the disproportionate suffering experienced by young and elderly age groups during the pandemic, policymakers should increase targeting of social-protection measures, facilitate private-sector investment in education and training, invest in improving digital services and infrastructure, ensure access to financial services, and collect age-disaggregated data on economic and COVID-related indicators.

Implemented policies

Although low-, middle- and high-income countries all introduced direct payments, food assistance, and other types of social protection programs, they targeted all age categories equally, without factoring in the heavier toll the pandemic had on young and elderly citizens. These two age groups also lacked access to government demand-side relief through the private sector. Measures to improve digital infrastructure and implement digital skills training programs have proven more successful.

Suggested improvements

Moving forward, the targeting of policy interventions should ensure that young and elderly age groups benefit from social protection measures. Policymakers should incentivize the private sector to invest in the training and reskilling of its own employees and to participate in systems preparing future workers. They should also make general and targeted interventions to improve digital affordability and access for young people and computer literacy for the elderly.

Another area of improvement is access to financial services and credit, which can be useful for older people who are more likely to be owning small businesses. Targeted programs can also help young people who might be less knowledgeable about special lending relief. Finally, it is important to increase rigorous research and make available age-disaggregated data on economic and COVID-related indicators.

At the intersection of economics, finance, and foreign policy, the GeoEconomics Center is a translation hub with the goal of helping shape a better global economic future.

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The new airminded: Civil aviation’s post-pandemic transformation https://www.atlanticcouncil.org/in-depth-research-reports/report/the-new-airminded/ Fri, 12 Nov 2021 19:18:42 +0000 https://www.atlanticcouncil.org/?p=449208 To no one’s surprise, air travel is undergoing a stuttering rebound unfolding in concert with the COVID-19 pandemic’s ebbs and flows. However, this rebound conceals deeper transformations poised to utterly change the air travel ecosystem.

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Aviation’s future: This is not just a recovery, it’s a transformation

As the world struggles to emerge from the depths of the COVID-19 pandemic wave, it is evident that air transport will experience a steady rebound as leisure travelers eagerly reschedule deferred family and tourist travel, while business travelers realize that not every deal can be closed via videoconferencing. The exact timing of the rebound will be gated primarily by the rate at which new COVID-19 variants and infection rates are brought under control. In the meantime, however, look for steady increases in both domestic travel and travel within regions where infection rates are brought under control and reciprocal arrangements are in place.

The International Air Transport Association (IATA) forecasts an overall return to historic trends by 2024, with international travel lagging slightly behind domestic travel. I am skeptical of the 2024 date but believe the shape of the trend line reflects the most likely scenario: domestic growth will lead international growth as Revenue Passenger Kilometers (RPKs) return to pre-pandemic levels followed by continued global aviation growth.

But this is more than a recovery: expect a profound transformation in the civil aviation ecosystem.

This projected return to historic norms belies a range of profound changes with important geopolitical implications. More specifically, the effects of the pandemic have acted as a powerful forcing function, accelerating some trends already underway, extinguishing other trends, and above all, spurring both technological and commercial innovations all but certain to turn assumptions about the interaction between physical air travel and cyberspace on their head.

The combined cross-impact of these trends will result in a profoundly transformed air transportation environment. We will not just travel more, we will travel differently. And with this will come a profound change in our collective worldview that in turn will affect perceptions of geopolitics. Simply put, we are entering a new age of “airmindedness”—a realization that the world is at once smaller and larger than we imagined: smaller in distance, but larger in diversity and surprise than most have imagined.

“Airminded” was a phrase oft-heard in the early days of aviation a century ago. At once both prophecy and reality, it neatly captured both the passion of early aviation innovators and the public’s expectation of how air travel would transform the world. In this moment of ever-growing desire to travel and innovators creating everything from Jetson-like personal electric vertical takeoff and landing (eVTOL) aircraft to space flight tourism platforms, we have entered a new age of airmindedness in which both device and destination are capturing the public’s imagination.

The immediate future resembles the dawn of 1950s’ jet travel

In terms of overall scale, we are entering a period of transformation comparable to or greater than the transformations that ensued following the advent of jet travel with the DC-8 and Boeing 707 in the 1950s. Like then, we are witnessing a convergence of technical innovations, new business models, growing travel demand, and increased public fascination with the potential of new aviation platforms.

Historically, carriers tended to favor capacity over speed: carrying more passengers per flight translated into both economies of scale in the sky as well as efficient use of limited landing slots and gates at airports. The post-pandemic reality is shifting to a focus on speed, first in the form of shortening trip times with point-to-point routing and then followed by higher air speeds as a means to making more efficient use of landing slots with faster turnarounds. This will be accompanied by an overall reduction in passenger capacity of individual aircraft, particularly as eVTOL “air mobility” offerings begin to arrive.

The most important factors and trends are outlined in this paper, while their geopolitical implications are highlighted below.

Geopolitical implications of an airminded age of aviation transportation

The cross-impact of the foregoing factors raises a host of geopolitical implications. When “airminded” seeped into public consciousness after the flight of the Wright brothers, it triggered no end of utopian expectations that somehow the reality of flight would help usher in a new era of world peace. This expectation was quickly contradicted in the First World War, dispelled by Alexander P. de Seversky, and utterly atom-smashed in the Second World War.

Sadder but wiser after a century of aerospace innovation, it is unlikely that anyone expects the coming aviation transformations to bring peace, but we are unquestionably entering a new airminded era in the sense of unfolding innovations and a consequent public fascination with the ensuing possibilities. Those transformations will most certainly generate no end of surprise beyond that already discussed. In closing, here is a sampling of possibilities offered to provoke further thought.

Post-pandemic tourism: new destinations—or back to the old dysfunction?

Immediately before the pandemic shutdown, tourist hot spots from Venice to the Taj Mahal were being overrun by hordes of plane-borne tourists. Spain’s Santiago de Compostela pilgrimage route risked turning into a 500-kilometer queue as more than 300,000 hikers applied to travel in 2019, and Machu Picchu reportedly was seeing its slopes being eroded and destabilized by the sheer volume of visitors tromping around its ruins. Will post pandemic tourism disperse or return to its old crowded ways?

Accelerating the centrality of cities as geopolitical powers

This is unquestionably the century of the city. World population became majority urban sometime around 2007, and by 2050 it is estimated that two-thirds of the world population will live in cities. Will the projected advances in aviation and 3D urban mobility further concentrate the power of cities, eventually eclipsing national power?

Can international air transport regulations keep up?

IATA is the central governing body for global aviation. The pace of current trends from airport landing slot demand to electric power are challenging IATA’s ability to keep up with events. Failure to do so could result in serious economic and travel disruptions.

Aviation innovation meets resource scarcity

Aviation’s move to electric propulsion will depend heavily on the same scarce rare earths and other mineral resources already in demand for everything from smartphones to electric highway vehicles. Aviation’s share of consumption might prove comparatively smaller than other sectors,
but the high visibility of privileged travelers crossing the sky in rare earth-enabled electrics could prove a public perception nightmare.

Technology-enabled terrorist threats

The combination of electric propulsion and increasing automation has already delivered new risks in the form of inexpensive drones. Basic systems are already being used in smuggling operations and have clear potential as platforms for delivery of everything from explosives to noxious aerosols. As platforms grow in capability, this problem will only become more acute.

Proliferating no-fly and no-go zones

The 2014 downing of MH17 was an ominous harbinger of future aviation conflict hazards. The arrival of free flight will exacerbate this risk, as the departure from defined airways will make it harder for observers on the ground to distinguish bystander, friend, and foe.

Flag protectionism?

As aviation becomes ever more central to economic and political power, there is the potential for the arbitrary blocking of foreign-flagged carriers as an incident to geopolitical competition. This was briefly the case in the late stages of the Brexit debacle, and thus there is precedent for others to contemplate interference with the free flow of air traffic as a geopolitical tool. Such flag-based interference is clearly irrational given the vulnerability from retaliatory action, but there is no shortage of instances where international players have chosen options that while irrational in the long term, satisfy narrow short-term goals.

Rise of the new global citizen (or is it the global nomad?)

From the moment our distant ancestors first learned to ride a horse or build a raft, the single greatest impact of transportation systems has been to unlock humans from the tyranny of place. The combination of the steady advance of cyberspace with the aviation innovations on the horizon will kick this unlocking into overdrive and in the process create a new kind of global citizen. This will not be the global citizen envisioned by 1970s Earth Day activists or visionaries like Buckminster Fuller and Marshall McLuhan. The first wave of the new global citizens are the super-wealthy who, thanks to their wealth and convenient access to cyberspace and air transportation, can live and work from wherever they please.

Behind this first wave are the merely wealthy and the upper middle class. Just as the arrival of jet travel in the late 1950s created a new kind of global tourist, our new aviation systems will create a new global nomadic class. Almost-retirees will move from Los Angeles to run their online business from a Central American beach town, while others snap up real estate in depopulated Italian hill towns, creating new foreign enclaves in the Old World.

We can barely glimpse the implications of a world in which millions of wealthy nomads can move on a whim from destination to destination, never quite putting down roots, flying high in comfort over the hundreds of millions more who remain chained by economics and circumstance to a particular place. The obvious tip of the iceberg includes acceleration of the continuing demise of the nation-state as a meaningful political unit, new social frictions as the arrival of wealthy and footloose strangers disrupts local economies. And, of course, this new mobility will open vast new opportunities for tax evasion and trans-border crime. Watch this space for a deeper examination of this critical trend.

Accelerating the decline of the fading nation-state order?

This aviation transformation creates as many challenges as opportunities for sovereign states—and in the case of fragile or failing states, the challenges seem to far outweigh the benefits. Specific issues include the inability to create and maintain formally designated landing sites attractive to commercial enterprises, coupled with the inability to control cross-border air traffic, thus complicating attempts to control borders and detect illicit activity. The result will be a perceived (and in many instances, actual) loss of territorial control that will force entities to ineffectually enforce their sovereignty, creating new uncertainties around air travel in specific regions.

The end of airspace as a global commons?

Airspace today is a de facto global commons supported by a host of international treaties underpinned by customary practice. The increase in both volume and variety of aviation platforms is certain to disrupt the existing order, triggering new uncertainties and a likely massive renegotiation of existing arrangements.

This happened with considerable success following the launch of Sputnik 1 in 1957. In contrast, the issue of renegotiating a commons arrived again in the form of the United Nations Convention on the Law of the Sea (UNCLOS) process beginning in the 1970s, and the result was at best a misfire. I hope for an optimistic result but fear the future will be more UNCLOS than Sputnik.

Read the full report

The Scowcroft Center for Strategy and Security works to develop sustainable, nonpartisan strategies to address the most important security challenges facing the United States and the world.

Acknowledgements1

1    Aviation’s future: Icon made by Freepik from www.flaticon.com; Geopolitical implications of an airminded age of transformation: Icon made by Freepik from www.flaticon.com; Read the full report: Icon made by Good Ware from www.flaticon.com;

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The 2021 Distinguished Leadership Awards: Celebrating the exceptional individuals meeting today’s extraordinary challenges https://www.atlanticcouncil.org/blogs/new-atlanticist/the-2021-distinguished-leadership-awards-dua-lipa-ursula-von-der-leyen/ Thu, 11 Nov 2021 03:28:20 +0000 https://www.atlanticcouncil.org/?p=456264 Singer Dua Lipa, European Commission President Ursula von der Leyen, Pfizer's Albert Bourla, and BioNTech's Özlem Türeci and Ugur Sahin earn the Atlantic Council's highest honors for shaping the global future together.

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Considering the many ups and downs of 2021—an uneven pandemic recovery, plus successes and setbacks for democracies worldwide—it’s worth saluting those who have helped power progress and strive for stability in these tumultuous times.

That’s what the Atlantic Council set out to do at Wednesday’s Distinguished Leadership Awards (DLA), honoring exemplary individuals who have contributed to the Council’s mission of shaping the global future together across a wide range of fields.

During a time of great global discord, European Commission President Ursula von der Leyen has displayed a fierce commitment to maintaining transatlantic ties. And amid the gravest public-health crisis in a century, Pfizer CEO Albert Bourla, along with BioNTech co-founders Özlem Türeci and Ugur Sahin, have showcased the best of what business can offer society. 

Meanwhile, Grammy Award-winning singer Dua Lipa has used her star power to help lift her ancestral homeland, Kosovo, from post-war poverty and provide an entire generation the gift of hope.

As the Atlantic Council marks its sixtieth anniversary, the organization’s President and CEO Frederick Kempe harkened back to its founding moment—when a young Kennedy administration was tested by the Soviet Union. He noted that there are strong parallels between the extraordinary circumstances in which the Council arose and today’s challenges, which range from the pandemic to climate change to competition with China. “That is why we are all here together, understanding the historic imperative of our times now is no less than at the time of our founding—and perhaps even greater,” Kempe said.

This year’s DLA honorees have proven that big advances are possible even when the road ahead looks most daunting. Here are some of the insights they shared with attendees at the gala dinner at Mellon Auditorium in Washington and with viewers around the world. (Read the full transcript here.)

Watch the full event

European Commission President Ursula von der Leyen accepts her award at the Atlantic Council’s Distinguished Leadership Awards dinner on November 10, 2021, at Mellon Auditorium in Washington, DC. (Photos by Elman Studio for the Atlantic Council.)

Ursula von der Leyen: “This year has reminded us that we must stand up for democracy every day”

  • Von der Leyen described the United States and the European Union as “natural partners” well-suited to jointly countering climate change and “rewriting modern rules for the global economy.” On the latter point, she cited the bloc’s new Global Gateway strategy—comparing it to US President Joe Biden’s Build Back Better World initiative as “a multiplier for high-standard investment in infrastructure” worldwide. “It will forge links,” she said, “not create dependencies.” She added: “When the European Union and the United States come together, we have the power to shape the world of tomorrow, from 6G to green finance.” 
  • Protecting democracy both at home and abroad should also be a priority for the transatlantic partnership, von der Leyen said, calling out authoritarian meddling in democratic elections, the January 6 attack on the US Capitol, and anti-democratic tendencies around the European Union. “This year has reminded us that we must stand up for democracy every day,” she said to applause from the crowd. 
  • The battle for those values increasingly plays out online. Von der Leyen noted the Council’s push for a transatlantic digital policy, which is now bearing fruit with the EU-US Trade and Technology Council. “We have a convergent vision on how digital platforms should work in open societies and open economies,” she said.
  • Invoking her American-born great grandmother and US-educated father—along with her two American children—the longtime Cabinet member under German Chancellor Angela Merkel hailed the “shared values” that bind both sides of the Atlantic: “The story of the transatlantic ties is made of millions of stories like mine.”

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Pfizer Chairman and CEO Albert Bourla.

Albert Bourla: “To defeat [the virus], we must be united”

  • A veterinarian by training from Thessaloniki, Greece, Bourla described the response to the pandemic as “a great example of the power of transatlantic cooperation” and a lesson in common cause. “The virus knows no geographic borders,” he said. “It does not discriminate based on race, religion, gender, financial condition, or political affiliation, which is a mistake that we greatly make, particularly in this country. So, to defeat it, we must be united.”
  • Bourla reflected on the bond between himself and his BioNTech business partners. “I can’t think of a better example of this unity than the strong relationship enjoyed by the leaders, the humans, of our two companies. Think about it: one a Jew from Greece, immigrated to America; the other a Muslim from Turkey, immigrated to Germany,” he said, referring to fellow honoree Ugur Sahin. “Some might consider it an unlikely pairing. I consider it my very good fortune.”
  • And the two companies are not letting up. By the end of this year, Bourla said, Pfizer and BioNTech will plan to pump out three billion vaccine doses, with another four billion slated for 2022. That’s not all: Just last week, Pfizer announced that its new oral antiviral drug reduced the risk of hospitalization or death by 89 percent among high-risk COVID-19 patients, which “has the potential to be a real game changer,” he said, “but in all cases should not be news that will feed vaccine hesitancy. Vaccines are very important.”
  • Also central to fighting the deadly disease is public-private partnership, Bourla added, which has allowed Pfizer to provide the US government low-priced vaccines to donate to poorer countries. “And we are working with the EU on not only supply agreements but also education campaigns to help address vaccine hesitancy,” he said.
BioNTech co-founder Özlem Türeci accepts her award as her husband, co-founder, and fellow honoree Ugur Sahin looks on.

Özlem Türeci: “We all let science and data be our teachers”

  • Türeci said she was puzzled at first to be receiving a leadership award rather than a science award, but she soon realized that “the key [virtues] for turning science into survival” are similar to those exhibited by leaders.
  • “The search for a COVID-19 vaccine, a quest deep in uncharted territory, required courage and also required humility, which means staying teachable,” she said. “All stakeholders were open to learn from each other in the face of a global threat. And we all let science and data be our teachers.”
  • Türeci added that the secret to their success has been “a tribe of comrades, of like-minded people,” laser-focused on leveraging their scientific smarts to help humanity. 

Ugur Sahin: “The desire to help others is hardwired and encoded in our genes”

  • Adding to his wife’s list of must-haves for successful, humanity-oriented science, Sahin singled out social responsibility. “I know that the desire to help others is hardwired and encoded in our genes—or you could also say our mRNA,” he said. “These genes are not always active. They often need a trigger to be activated—an inspiration, an example, someone to take the first step.”
  • This is what drove the BioNTech team to grind, as Sahin described it, “in 24/7 shifts, to work day and night, also on the weekends, and go the thousands of extra miles.” Sometimes, he added, “the work of scientists and drug developers is celebrated—like this evening’s impressive award—but most often it happens behind the scenes in quiet labs or at [a] patient’s bedside.” 
Grammy Award-winning musician and activist Dua Lipa.

Dua Lipa: “Give us a chance, and we will excel”

  • Honored for her efforts to help Kosovo through her Sunny Hill Foundation, which seeks to improve quality of life in the young nation, the British-born singer painted her parents’ birthplace as a thriving cultural hub “bursting with creativity.”
  • Still, she said the scars of war remain visible and even the younger generation struggles to seize opportunities to grow, work, and travel. “Even with a determined and bold national spirit,” she said, “it takes time to recover and find a new footing.”
  • That’s why Lipa and her father launched the Sunny Hill Foundation, which stages an annual music festival that brings A-list artists to Pristina and will soon break ground on an arts and innovation center that will offer young people a creative space. “We are just thirteen short years into our journey of independence and as part of a strong international community, we will thrive emotionally. We will thrive economically and culturally,” she said. “It is in our DNA.”

 Dan Peleschuk is the New Atlanticist editor at the Atlantic Council.

Read the transcript

New Atlanticist

Nov 10, 2021

Full Transcript: 2021 Distinguished Leadership Awards honor bold visionaries in challenging times

By Atlantic Council

Uğur Şahin, Özlem Türeci, Ursula von der Leyen, Dua Lipa, and Albert Bourla accepted the Atlantic Council’s recognition Wednesday night for their leadership in shaping the global future.

European Union International Organizations

The post The 2021 Distinguished Leadership Awards: Celebrating the exceptional individuals meeting today’s extraordinary challenges appeared first on Atlantic Council.

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Pfizer’s Albert Bourla on how the pandemic ends https://www.atlanticcouncil.org/blogs/new-atlanticist/pfizers-albert-bourla-on-how-the-pandemic-ends/ Tue, 09 Nov 2021 19:11:09 +0000 https://www.atlanticcouncil.org/?p=455408 Bourla joined the Atlantic Council to talk about his collaboration with BioNTech on the COVID-19 vaccine, his take on misinformation and politics in medicine, and his personal story.

The post Pfizer’s Albert Bourla on how the pandemic ends appeared first on Atlantic Council.

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Watch the full event

Pfizer Chairman and CEO Albert Bourla joined the Atlantic Council to talk about his collaboration with BioNTech on the COVID-19 vaccine, his take on misinformation and politics in medicine, and his personal story. He, along with BioNTech co-founders Uğur Şahin and Özlem Türeci, will receive the Atlantic Council’s Distinguished Business Leadership Award on Wednesday, November 10. Below, edited for length and clarity, is Bourla’s conversation with Frederick Kempe, president and CEO of the Atlantic Council. 

FREDERICK KEMPE: You’re a Greek-born American. You’ve called yourself a Greek by birth and American by choice, the son of Holocaust survivors from Thessaloniki, Greece. As I understand it, there were fifty thousand Greek Jews before World War II in Thessaloniki and only two thousand survived, and you’ve written this upbringing has shaped you. I wonder if you could talk about what it is your parents went through in their childhood and how these origins and how this history has shaped who you are today.  

ALBERT BOURLA: You are right. From fifty thousand Jews, only two thousand survived, that’s a 96 percent extermination in the city of Thessaloniki in Greece, and among those two thousand were my father and mother. They met after the Holocaust. They decided to build a life together, and then they had me and my [sister]. And my parents talked to us a lot about their experiences, and that’s not very common because a lot of Holocaust survivors avoided speaking to their kids about their experiences because it was very painful to remember those stories.  

But our parents did, and the thing that they always did was that they never spoke to us about hate. They never spoke to us about revenge. They never [made us think] that we must pay back those that did that to us or to our family. Not at all. On the contrary, it was always a celebration of life. They were telling their stories, and then the moral of the stories was that nothing is impossible. We almost died and we survived, and look what we have now… our family.  

I think this is what stamped my personality from the early days, this optimism, and this belief that it’s never the end before it is really the end, and you can always do things to change your fate, and I’m grateful to them for that.  

FREDERICK KEMPE: You also said that your Jewish upbringing in Greece, coming from a small country on the world stage, being of a religious minority from the country, taught you to fight for what you believe is right and never to give up. And were there elements of that in the vaccine fight as well? 

ALBERT BOURLA: I believe so because the personality of someone is really built in the early days of his life, and then it follows in whatever they do. [We], living as a very, very small minority in Greece, we had to learn how to be able to thrive while we’re very, very different than everybody else. And the same is as a Greek coming to America with a very thick accent. Trying to be able to prove yourself also requires that you fight for what you believe is right.  

So that also followed me all the way to the COVID-19 vaccine. But the fundamental is that what really helped us and BioNTech and the teams that they worked very hard to develop in record time, such a success, were two things: One was that we really thought big. These teams really thought big. They didn’t try to do the eight years, seven years of development. They tried to do the eight years [in] eight months of development.  

And the second was that there was a very deep, instilled sense of purpose. We knew that what we were doing was not going to affect our lives. It’s not going to affect our company’s future. It’s going to affect the lives of the future of the world. That gives you a tremendous drive and this is what everyone on this team, in Pfizer and in BioNTech, did during these eight marvelous months.  

FREDERICK KEMPE: We all have particularly formative experiences in our lives. Could you share with us any particularly formative experience that you had before the onset of the COVID-19 pandemic? 

ALBERT BOURLA: You know, I am a veterinarian by educational background, and after I graduated from the veterinary school… I did a PhD in the biotechnology of reproduction. My ambition was to have an academic career and I was really geared towards that… Pfizer Greece was recruiting at that time, and they reached out to me to offer me a very good position in their animal health group, which in the beginning I was very reluctant to take. 

But eventually, they convinced me to do it and it was always my idea that for me, it would be kind of a sabbatical. I will go to make a small break in the industry and then come back to what I really love doing, which was teaching and researching in academia. 

But I didn’t take into consideration that months after I joined Pfizer, I fell in love with the company and fell in love with what they are doing. I fell in love with the private sector because I saw how dynamic it is and how you can make a difference over there. I’ve stayed twenty-eight, so far, twenty-eight years with the company, and I stayed three of them in Greece. The other twenty-five years I spent internationally.  

The job was in Athens, so to join Pfizer I did the first relocation, which I found very difficult to do, from Thessaloniki to Athens. I followed other eight relocations. Together with my wife, we lived in different cities in five different countries. That was an extremely interesting experience. In most of them our kids had to follow because they were born.  

That’s, I think, is the biggest gift I gave them, the fact that they were exposed to different cultures, to different civilizations, to understand that diversity is very important and to understand that the world is not how it looks in New York or in Texas or in Atlanta. The world is very different in every single corner of this Earth. I think that was very, very important.  

And here we are. Everything can be done. A Greek from humble beginnings made it all the way to the top. Actually, when our board called me into the boardroom to announce to me that they elected me as the CEO, the comment that I made was “Only in America,” because, really, this is the place that you can really make it to the top irrelevant [of] what are your beginnings. 

Everything can be done. A Greek from humble beginnings made it all the way to the top… [the United States] is the place that you can really make it to the top irrelevant [of] what are your beginnings. 

ALBERT BOURLA, CHAIRMAN AND CEO, PFIZER

FREDERICK KEMPE: You’ve seen, in these twenty-seven, twenty-eight years at Pfizer, the company evolve. You’ve seen the science evolve. What were the most crucial factors that both prepared the science and Pfizer for this moment in history and this vaccine development?  

ALBERT BOURLA: Yes. I think Pfizer had tremendous success in the 1990s and the beginning of 2000s with science, but then it was a period that was not that productive. When my predecessor took over approximately twelve years ago [at the end of] 2010 and beginning of 2011, he found a company that needed really to make serious changes in the way that research and development is conducted, and they did.  

He drove significant changes. We focused our research. Before, we were spread thin in thirteen different therapeutic areas and, you know, when you are spread thin in thirteen therapeutic areas, usually you’re not very good in any. You are mediocre in all. We reduced that to six therapeutic areas, and we were able to become the best in each one of them.  

We consolidated our research centers. We moved our research centers to places where science is happening. We did tremendous changes in the way that research and development was working, all of that under my predecessor. When I took over in 2019, I found an excellent infrastructure so that I could make radical changes to the company. It is because of the work of my predecessor that I did all of that. And I focused the company on the science with diversity, or to use a better word, we found way better homes for two of our three businesses and with that we created significant improvements in the research-and-development budget. 

We increased the research-and-development budget dramatically. We increased dramatically the digital budget and also, we reduced the administrative budget in the company. All of that, basically, I took a serious bet in the science of the company and this I did, as I said, because I truly felt that we are at this time at the same point.  

So all of that happened in 2019. We brought a very new culture that can foster innovation. We increased budgets. We brought digitally the way that we do discovery and development. When COVID-19 happened in 2020, I think a lot of this had advanced and we were able to utilize a lot of that plus a very significant shift in our culture to be able to do things that seemed to be impossible.  

And this is exactly what happened. It was not luck. We were preparing for two years, and we found ourselves to be at the right set of mind, so that we could develop the breakthrough in a record period of time.  

It was not luck. We were preparing for two years, and we found ourselves to be at the right set of mind, so that we could develop the breakthrough in a record period of time.

ALBERT BOURLA, CHAIRMAN AND CEO, PFIZER

FREDERICK KEMPE: Give us a little bit of a feeling of when you saw that COVID-19 was going to be the challenge that it became and what did you move to take it on? And if I’m not mistaken, mRNA vaccines had never been used for clinical use before. I’d love for you to talk about what you spotted early on, how you moved things, but then the role that mRNA plays during this period of time.  

ALBERT BOURLA: Yes. In January, [our entire discipline was] thinking that COVID-19 is an issue that mainly concerns China, and we were very concerned because of that, because we have significant operations in China. We had fifteen thousand people at that time, we had four manufacturing sites, and we were worried about our people and how they would be able to maintain their jobs.  

So we set up a task force that was really following very closely what was happening in China and we were trying to make sure that we do the right things. In February, it started becoming clear to me that this might go outside of China, and then in the second half of February, I was in Europe to attend an Economic Forum meeting and I went there and then two days before, and then the forum was canceled because of COVID-19. That was, for me, an important alarm went off. I realized that things are serious.  

That was the first time that a conference like that was canceled. I took a plane [back], and on the plane, I wrote down the priorities that I felt that a company like ours should have, and the first was that we need to make sure that we protect the safety of our people. The second was we need to make sure that we maintain the supply of critical medicines to people. I had seen in China that hospitals were overwhelmed, and we are one of the biggest suppliers of hospital products in the world. 

So I was thinking how we could maintain a surge in demand that could be 20, 30, 40, or 50 percent higher for some products than we had before, while our plants had to operate under COVID-19 restrictions. Very challenging. I asked that that would be a number two priority. And then number three was that we need to develop a vaccine and a treatment.  

And we came back, and I asked our team to develop a vaccine, then bring me plans. They brought me plans that they wanted to use the mRNA technology. I was puzzled when they told me. I was very familiar with mRNA technology because we had hired people back in 2015 [who] specialized in mRNA.  

But the most pivotal thing that we did was we had an agreement with BioNTech, a collaboration agreement, that was signed in 2018 to develop a flu vaccine by using this technology. I knew that there was not a single product mRNA out there. I challenged my team and I [asked] them, are you sure that you want to go with mRNA? [I told] them that if that’s going to be successful, that will be not just the first COVID-19 vaccine, that will be the first vaccine ever with mRNA. And that this work that they were doing with BioNTech, the last almost two years, 2018 and 2019, was giving them a high level of comfort that the technology is mature and that, more importantly, the partner is the right one.

I challenged my team and I [asked] them, are you sure that you want to go with mRNA? [I told] them that if that’s going to be successful, that will be not just the first COVID-19 vaccine, that will be the first vaccine ever with mRNA.

ALBERT BOURLA, CHAIRMAN AND CEO, PFIZER

So in this meeting they convinced me to take that risk and go with mRNA. But then I said I need to talk to their CEO, and I called Uğur and that was the first time that we spoke on the phone. It was, I think, love at first sight and it was the beginning of a tremendous relationship, collaboration, between the two companies and me and him, particularly, in person. Later, I met also Özlem, his wonderful wife, who is a pivotal member of the research team over there. And I never ever regretted that we made this highly risky decision and I’m happy that we did.  

FREDERICK KEMPE: Can you explain to us how the mRNA works differently and why was it ready at this point if it hadn’t been ready for clinical use before?  

ALBERT BOURLA: Yeah. Most of the vaccines, the principle is that you’re introducing a part of the virus, let’s say, into your body so that your body will create antibodies. It will recognize the virus as an enemy and will create antibodies.  

Now, you put a piece of the virus so that you will not get the disease, or you put the dead virus, or you put the modified virus, or there are new technologies, but this is the fundamental [part of most vaccines], that you’re putting a piece of the virus so that your body will develop an immune response. When the real virus comes your body is ready with antibodies so you can win easily the battle, or easier the battle.  

The mRNA technology is trying to reverse this challenge. What they are doing, instead of introducing, let’s say, a piece of the virus… you are sending a message to yourself through a messenger RNA so that your cells will produce a similar protein like the protein of the virus.  

Once you do that, then your body will recognize this protein that something is not normal that it should be here so it will develop antibodies against this protein, and then you will be protected when the real virus comes.  

So as you can see now, you don’t even put a piece of the virus. You don’t put any foreign protein in you. You are putting a very small piece, a message, of RNA that will stay a few days in your body and then [disappear]. But those will send the signal to yourself to produce this protein. It is a very revolutionary idea that really was discovered twenty years ago, and it was studied for all these two decades with the last five years way more intensively, and BioNTech was one of the pioneers in doing these studies. Moderna was another one, and eventually, the first success that we’re able to do was this product that we developed jointly with BioNTech, the COVID-19 vaccine. 

FREDERICK KEMPE: What other doors might this mRNA vaccine open for you and for science in general? 

ALBERT BOURLA: I think cancer was the first thing that we try to tackle with the mRNA technology, and I know that BioNTech worked very intensively to do that. The idea is that you are training your body to attack the proteins of your tumors. You identify the tumor and then you send a message through the messenger RNA to yourself, start attacking this tumor. It is a very big field that is studied very intensively right now.  

Another field is the field of infectious diseases. We saw the first vaccine ever, which was the COVID-19 vaccine, with mRNA technology. Ourselves, we are working on a flu vaccine, as I said, since 2018, and that could be next-generation flu vaccines with mRNA. But also we are working on multiple other targets, creating vaccines for other infectious diseases.  

There is a third application, which is for people that they are born with a mistake in their DNA code, and there are a lot of rare diseases; they are happening to people because somewhere in one gene there is one small mistake in their DNA, and those people, they have to live without until the end of their lives and many times their life doesn’t last very long because of this mistake in their genes.  

There are a lot of technologies that are trying to use gene editing, so that they are trying to use the same technology to be able to change, or repair, the mistake of your DNA so that you can cure, basically, those people.  

These are just three of the very hot cutting-edge technological fronts that right now we are working on. 

FREDERICK KEMPE: And what’s most promising among those? Are we closer now to something regarding cancer and mRNA? Or where do you see those three the most promise over the short to medium term?  

ALBERT BOURLA: I hope so. I hope so. We don’t have success yet over there as we didn’t have a success in vaccines before COVID-19. I hope so. But which one is the most promising? I would say that [for] infectious diseases, now we have a very good proof of concept that this works to attack foreign invaders, viruses, or other microbials. I think that’s the most likely to bring fruits faster.  

FREDERICK KEMPE: So now let’s talk about the period of time from March 20, 2020, to today. It must have just been an incredible moment of intensity for you. But as you went through this period, what has struck you most positively and negatively? What do you feel that you’ve learned through this very, very intensive period, which by the way, is still ongoing? 

ALBERT BOURLA: I would say two things. The first one, it is, clearly, the one that stands out for me. It is that when it comes to leadership, people don’t know what they can and cannot do and, if anything, they have a severe tendency to underestimate what they can achieve. And if people are given the resources and they are given a very big goal, if you force them to think big, they will surprise you with what type of solutions to any single problem they will bring.  

When it comes to leadership, people don’t know what they can and cannot do and, if anything, they have a severe tendency to underestimate what they can achieve. And if people are given the resources and they are given a very big goal, if you force them to think big, they will surprise you.

ALBERT BOURLA, CHAIRMAN AND CEO, PFIZER

So, for me, that was a leadership lesson that was very important, and I will never forget. On the leadership again, if there is something that I regret, for example, you know, we went through a lot of pressure, and I had to put a lot of pressure [on] my people. I don’t regret that I did that because I know that without that, we wouldn’t be here, and I know that my people don’t mind that I put a lot of pressure [on] them because they knew that this is what was needed.  

But at certain times, it’s not that I put pressure, I lost my temper, and that I regret. The lesson for me is that the leader needs to do whatever he or she can not to come in a position that will stress the people. You can put a lot of pressure, but you should never lose your temper and make people feel unhappy and uncomfortable. So that’s another good lesson that I learned, and I try to do less of it, let’s say.  

FREDERICK KEMPE: Obviously, you’re not a politician. You weren’t elected as a politician. But you’ve had to deal with a lot of politics in the last eighteen months. What have you learned about geopolitics and major-power politics? What have you learned about domestic politics? You’ve been through two quite different American presidents. You’ve also learned a little bit about fake news during this period of time as well. So talk to me about what you’ve learned about geopolitics, domestic politics, and fake news.  

ALBERT BOURLA: Well, clearly, it was a crash course for me, and I think that I learned enough to have a PhD in political sciences right now but, unfortunately, the hard way. I tried to protect the company from being involved in the politics. In the United States, it was impossible to do that because there was so much animation and polarization, and… COVID-19 was at the epicenter of the debate. The development of a vaccine became the essence of the debate, which it shouldn’t be. It shouldn’t be discussed in political terms. Only scientists should have to discuss it.  

Every day we tried to navigate the political mindset and the way that I saw it was that I had to create pressure [to] our people but also, I had to protect our people from internal bureaucracy, from external bureaucracy, and give them the resources so that they can work.  

I had, somehow, to be the seal that will absorb the pressure, the political pressures, rather than having the pressures going all the way down to our people. They should feel that they have to worry only about the lab and their patients. And I tried to do that, and it was not always easy… 

The other thing that I learned, because that gave me the opportunity to speak with a lot of leaders… You realize that they are human beings. You realize that they are people that have the same worry about their people, that they try to do the best for their country, and when you interact a lot with them you realize, also, they have family, and they have kids, and they have their own concerns.  

It was a very humbling experience to be able to do that and, literally, meet families of many leaders in the world because, you know, we had calls evenings and nights trying to find solutions to their problems, and that was also a very humbling experience.  

FREDERICK KEMPE: And you’ve shared a little bit in the past about direct phone calls from the president of the United States, direct communication. How do you in a position like your own deal with that? Because, obviously, there’s a lot of pressure on them as well, as you said, as human beings.  

ALBERT BOURLA: Yes. At the time, it was President Trump, and I had met President Trump before the pandemic and we had discussed… health policy, mainly. But, of course, the pandemic and the vaccine were very high on his agenda. He would reach out to me to ask about how we are doing and if there’s anything he can do to help us accelerate, et cetera, et cetera, which I told him that there is nothing.  

We [were] moving full speed anyway ourselves and I just [needed] to let my people work without worrying about politics, and eventually we did it. We brought it very early. I know President Trump [would have liked] to see it before the elections. It came after the elections. It has nothing to do with politics. That was the speed of science.  

We [were] moving full speed anyway ourselves and I just [needed] to let my people work without worrying about politics, and eventually we did it. We brought it very early. I know President Trump [would have liked] to see it before the elections. It came after the elections. It has nothing to do with politics. That was the speed of science. 

ALBERT BOURLA, CHAIRMAN AND CEO, PFIZER

FREDERICK KEMPE: Tomorrow evening when you receive the award, before you receive yours President of the European Commission Ursula von der Leyen will receive our Distinguished International Leadership Award, but she’ll also introduce you for your award. So that shows the sort of respect that can be shared between a political leader and a business leader. 

ALBERT BOURLA: Well, I can tell you that President von der Leyen [is] one of the most knowledgeable leaders. She knew details about the disease, and she knew details about the technology, and I was very impressed. A lot of our discussions were going really, really to the bottom of what is happening and what would be the best way to address them. And because there were, again… so much stress that creates a bonding experience for both leaders, me from a small company, her the president of a big company, Pfizer, but compared to what she is doing, the president of European Commission, clearly, she has way bigger responsibilities. But that created a bonding with her as well…  

FREDERICK KEMPE: There was some fake news during this period of time about the vaccines, you know, all sorts of conspiracy theories. How did you deal with that and how did you navigate that and where do you feel the primary source of this sort of fake news was? How damaging was this to us?  

ALBERT BOURLA: I’m afraid it [caused] quite a lot of damage and particularly with us, we were targeted by a lot of, let’s say, dark organizations that you don’t really know [who owns them]. You suspect that there are some countries behind. We were getting a lot of briefings from CIA, from FBI, about cyberattacks that may happen to us, but also about the spread of misinformation.  

You know, there are two groups of people: There are the people that they are vaccinated. There are people that are skeptical about the vaccination, and both of them are afraid. Those that are getting the vaccine, they are afraid of the disease, and they believe that because people are not getting vaccinated, they are increasing the risk to them. They are increasing the exposure. So they are mad with them that they don’t get the vaccine. Those that don’t get the vaccine, they’re afraid of the vaccine and they are mad with the people that are pressing them to get it. 

Those I understand. They are very good people. They are decent people. But they had a fear, and I understand it, and they don’t want to take chances. But there is a very small part of professionals [who] circulate, on purpose, misinformation so that they will mislead those that they have concerns [with the vaccine]. Those people are criminals. They’re not bad people. They are criminals because they literally cost millions of lives. 

There is a very small part of professionals [who] circulate, on purpose, misinformation so that they will mislead those that they have concerns [with the vaccine]. Those people are criminals. They’re not bad people. They are criminals because they literally cost millions of lives. 

ALBERT BOURLA, CHAIRMAN AND CEO, PFIZER

FREDERICK KEMPE: You’ve also come to see close up the inequities in the global health care system, which also has influence on recovering from COVID-19. Have you learned anything during this period of time about whether and how one can overcome them and how did you have to work within them to navigate this period?  

ALBERT BOURLA: Oh. That was a very, very big issue from day one for me, and I realized that if we have this polarization within the country, for example, I could only imagine what will be between countries when the vaccine would become available if we don’t have available for all.  

So to make sure that the vaccine is available for all, there were two things that we had to do. The first was to have a price that would not become an obstacle to any country, and that was easy to resolve. We set up a price, that it is the cost of a takeaway meal in the developed world. But when we are moving to middle-income countries, not in the high, we charge half of this price almost. And when we went to the low-income countries, we gave them a… price at cost. So that was easy.  

Then the second thing that we needed to have it is we need to have enough vaccines for all. It is clear that when you start from scratch, in the first month you will have fewer doses than the month after. We went to all the countries, and we asked to place orders, and I saw the orders that were coming and most of them were coming from high-income countries.  

The European Union placed orders. The United States placed orders. The United Kingdom placed orders. Japan placed orders. Small and, let’s say, low- and middle-income countries, they weren’t placing orders. I sent letters into heads of states of these countries urging them to change their position and place orders because the quantities will be allocated. They didn’t do it, most of them, and they didn’t do it because they placed orders either with other vaccines from China, from Russia, some other solution, maybe from AstraZeneca. 

When eventually our vaccine became very successful and we started producing enough quantities and maybe some others that have problems to deliver the quantities that they promised, then they all came back to us, and they asked that we want those. The problem was that in the first few months the doses were already allocated to countries that placed orders. I couldn’t just tell them I’m not giving it to you anymore.  

So the solution was to build more so that everybody can get it, and this is where we invested dramatically, and from 1.3 billion doses that we were expecting to produce towards the end of 2020, in 2021 pretty soon in the first quarter, we raised that to three billion instead of 1.3 billion.  

I’m very happy to tell you that by the end of this year, which is in one month and a half, we will have produced three billion doses, and from there… approximately 40 percent, 1.2 billion [doses]… will go to low- and middle-income countries and in the quarters that follow I think everybody will have enough doses because we are producing four billion for next year and just from one company that will be enough for, basically, everyone who wants can have access. 

FREDERICK KEMPE: And part of this was an agreement with, I believe, the Biden administration and the US government, in which you provided at cost, and they are providing to certain countries at no cost. Is that right?  

ALBERT BOURLA: It’s absolutely right. This is the biggest agreement that we made with them. It is one billion doses. The US government is buying those doses from us at cost and then they are giving those doses free of charge, completely free of charge, to other countries. They donate them.  

The agreement with the US government is that they can give them to whoever they want as long as they belong to the list of the ninety-two, approximately, poorest countries in the world. They cannot give it to middle-income countries. They need to give them for free to the poorest countries of the world and this is what they want to do, and this is what they are doing. No strings attached from anything that I know, and I can see. They are just giving the doses without asking anything in return.  

FREDERICK KEMPE: Where do we stand today? Masks, jabs, testing kits—are these going to become a more permanent part of our lives, or is there an end to what we’re going through as we see different variants rise up here and there and new need for a response?  

ALBERT BOURLA: No, I believe we will see an end. I think we believe that life will go back to the way that we knew before. Of course, there will be changes because of things we learn. I think we’ll be changing the way that people work now that we know that this works that well.  

I believe we will see an end. I think we believe that life will go back to the way that we knew before. Of course, there will be changes because of things we learn.

ALBERT BOURLA, CHAIRMAN AND CEO, PFIZER

But I think we will reach the normal waves of social life that you can go to the cinema, that you can go to restaurants, that we don’t have to wear a mask. That will end. To do that, we need to vaccinate with a full series of doses the vast majority of the people, and if we do that, we will have herd immunity and then we will reduce the virus all over the world.  

The only thing that stands between the new way of life and the current way of life, frankly, is the hesitancy to get vaccinated, the people that are afraid to get the vaccines, and they create issues not only for them. Unfortunately, they are going to affect the lives of others and, frankly, the lives of the people that they love the most because they are putting at risk the people that they hug, they kiss, [and] they socialize with. 

For God’s sake, it is such a big mistake and it was such a big disservice to society to politicize something like that, to become a political statement if you want to mask or not. If you were, you’re a Democrat. If you’re not, you are a hardcore Republican. That’s ridiculous. It should not be like that, and it was a very bad service to humanity. 

FREDERICK KEMPE: And is there going to be an annual vaccine for COVID-19? Is a booster shot enough right now? Can you see into the future well enough to tell us what you think that looks like?  

ALBERT BOURLA: I think the booster shot, the third dose, is the one that gives very, very high level of protection, higher than the originally achieved levels of protection, which was 95 percent with the two doses. The question is how long will it last? We know that we saw a waning of immunity six months after the second dose. We need to follow up for six, seven, eight, nine months after the booster dose.  

If I can take a prediction, because we have seen these type of vaccination curves multiple times and the immunogenicity curves, it looks like that it will last for a year. It looks like there is a chance that this will become an annual revaccination. However, I have been surprised many times in my life with things that in science, we expect things, and they don’t come exactly like that. We need to wait and see. But the likely scenario is annual revaccination.  

FREDERICK KEMPE: What keeps you up at night and then what gives you the most hope, looking into the future? 

ALBERT BOURLA: The future of the life-science sector is brilliant. There is going to be a huge need for good medicines. People are getting older, and not only they live longer but this means that new diseases that were not important before start emerging. And also, people are moving from rural places to urban places. A hundred fifty million people in the world are moving to cities every year.  

This means in health care, from zero access almost to medicines to access to medicines. The demand will be huge. I think science is at the cusp to be able to provide solutions for this. The offer also will be there. And this is happening because biology, combined with digital technologies, right now is unlocking tremendous, tremendous opportunities for new medical treatment.  

All of that, I think, is going to be very good. Clearly, there will be an issue, which is the cost, and I think that’s the biggest issue that we are going to face. It is not the cost of medicines. It is the cost to society of people living longer, which means more health care costs, more pensions, more everything.  

Medicines will be part of the solution, not part of the problem. The medicines, the good medicines, will reduce hospitalizations, will reduce other medical interventions, and, as a result, will bring savings to the health care system rather than an additional cost and, of course, will make the lives of humans longer and better, and I’m very optimistic that this will happen in the next decades.  

FREDERICK KEMPE: Talk about [your collaboration with BioNTech] and why this one has worked. Why is it you’ve been able to produce something of quite historic nature when many corporate collaborations among CEOs and founders of companies don’t work in quite the same way?  

ALBERT BOURLA: I think it was because both companies had developed very similar cultures. They were both really very purpose-driven… One was very big, the other was very small compared to the big one. The leaders [behind the vaccine]: One was a Turkish Muslim that immigrated to Germany. The other one was a Greek Jew that immigrated to the United States. From a first glance, we could be the exact opposite.  

But I felt the thing that connected us was that we had a common purpose. The first thing that we discussed with Uğur was… the principles under which we are going to operate, and we said, it doesn’t matter who does what. [Nothing else] matters [other] than bringing the vaccine, as our number-one priority… 

The leaders [behind the vaccine]: One was a Turkish Muslim that immigrated to Germany. The other one was a Greek Jew that immigrated to the United States. From a first glance, we could be the exact opposite. But I felt the thing that connected us was that we had a common purpose.   

ALBERT BOURLA, CHAIRMAN AND CEO, PFIZER

And, if anything, I think the fact that we have both a little bit of Mediterranean heritage created [an] even stronger bond and trust… The fact that we had such a big trust in one another cascaded down and our teams trusted each other too, and that was why this thing happened so well.  

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If the pandemic hit a year earlier, ‘we might not have been in the position to respond this fast,’ say BioNTech co-founders. Here’s why. https://www.atlanticcouncil.org/blogs/new-atlanticist/if-the-pandemic-hit-a-year-earlier-we-might-not-have-been-in-the-position-to-respond-this-fast-say-biontech-co-founders-heres-why/ Mon, 08 Nov 2021 17:43:36 +0000 https://www.atlanticcouncil.org/?p=454859 BioNTech co-founders Uğur Şahin and Özlem Türeci joined the Atlantic Council to talk about their pursuit to develop mRNA vaccines, including the COVID-19 vaccine, and how they work on common passions as a couple.

The post If the pandemic hit a year earlier, ‘we might not have been in the position to respond this fast,’ say BioNTech co-founders. Here’s why. appeared first on Atlantic Council.

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BioNTech co-founders Uğur Şahin and Özlem Türeci joined the Atlantic Council to talk about their pursuit to develop messenger RNA (mRNA) vaccines, including the COVID-19 vaccine, and how they work on common passions as a couple. They, along with Pfizer Chairman and Chief Executive Officer Albert Bourla, will receive the Atlantic Council’s Distinguished Business Leadership Award for their accomplishments on Wednesday, November 10. Below, edited for length and clarity, is Şahin and Türeci’s conversation with David Gelles, a columnist and business reporter at the New York Times. 

DAVID GELLES: Uğur, as you think back to some of your work earlier in your career when you were studying immunotherapy and oncology, those were fundamental experiences you had, but did you ever expect that the work you were doing then—twenty and thirty years ago—would now lead you to a moment where you were addressing such a severe and immediate concern like the COVID-19 pandemic? 

UĞUR ŞAHIN: Definitely not. My research started as a young immunologist asking a question: How can we use the mechanisms of our immune system to fight cancer? So we wanted to develop cancer immunotherapies, and infectious disease was not on our focus when we started our work. I imagined that we could develop cancer immunotherapies that would be useful to treat cancer in a personalized fashion. 

DAVID GELLES: And Özlem, you had very similar interests at the start of your scientific and research career as well, also studying immunology. What drew you to the study of immunology and specifically cancer, which was also a focus of yours from an early age? 

ÖZLEM TÜRECI: Cancer is a very complex disease, which makes it very interesting for a scientist, so that was one of the reasons. I was curious and wanted to learn more about this disease. And the second was that in medical school, when I made my first experiences with treating cancer patients, I could not believe that this cut-poison-burn type of approach would be the only one we could offer to these patients, and that was sort on the medical/clinical side, the reason which drew me to this disease. 

DAVID GELLES: In addition to being colleagues and business partners, you also are a couple. You know one another as well as anyone. And one thing I’ve always wondered and never had the opportunity to ask you is what it’s like to work together. How do you divide the labor, if you will? Talk to us a bit about the collaborative process with someone who I imagine is not only your greatest collaborator, but probably also your best friend. 

ÖZLEM TÜRECI: It’s a symbiosis, and I think that is the secret why it works so nicely. We have complementary skills so that we complement each other in the process. I pick up where Uğur leaves things and vice versa, and we have the same values and standards to what we want to deliver with our work. And this is a reason why even though we are married we can work very functionally together. 

UĞUR ŞAHIN: We don’t see what we do as a work. It’s really part of our life. And therefore, it’s a wonderful chance to share this passion with my partner here and to really, every moment, decide whether we continue to discuss scientific topics, and sometimes we even have private topics, but we don’t discriminate between life-work balance. It’s one thing. 

We don’t see what we do as a work. It’s really part of our life. And therefore, it’s a wonderful chance to share this passion with my partner.

UĞUR ŞAHIN, CO-FOUNDER AND CEO, BIONTECH

DAVID GELLES: I’m remembering a detail I included in an early article I had the good fortune of writing; it was a detail you shared with me where on the day of your wedding, after the ceremony was concluded, you went back to the office together and got back to work. Is that true? 

ÖZLEM TÜRECI: That’s true, yes. 

DAVID GELLES: Uğur, you were born in Turkey and your father, if I remember, immigrated to Germany when you were four years old to take a job at a Ford factory. And Özlem, you were born in Germany to parents who were Turkish immigrants. How did that experience shape your individual and scientific careers, and also your partnership perhaps? 

ÖZLEM TÜRECI: I would not say that it shaped my career too much because our family was integrated, and I grew up in a way where I never faced any discrimination. At least, this was the way I felt. It probably impacted the way we interact with each other because there are sorts of mentality aspects that we share which probably come from this nationality that we also share, and that makes it easier to agree on values, on standards, and on general principles of doing things. 

DAVID GELLES: Let’s fast forward now to 2008… You decided to put [your first company and academic careers] aside and create this new company, BioNTech. What was behind that decision? What gave you the conviction to walk away from what was, obviously, a fair amount of success in the realm you were already enjoying and go for this even more ambitious target? 

UĞUR ŞAHIN: At the end of the day, it was very consistent with our vision. From the very beginning, our vision was to enable the development of what we call individualized immunotherapies. And the idea behind that is that every cancer is different, and every patient has a different cancer, and the way how we are treating cancer patients today is we are trying to find an existing drug and hope that this existing drug will be able to help this patient with a unique cancer. And we believe that the fundamental scientific challenge behind the failure of cancer treatments is that we disregard this complexity, and therefore we were interested in developing technologies that allow us to make tailored immunotherapies. 

We accomplished that in the academic settings. That means we found a potential solution to solve this challenge. But it was very clear to us that we could not continue our work in the academic setting because you have to translate it. You have to bring it into clinical testing. You have to connect that to pharmaceutical development, which of course means many, many millions in investment. And therefore, it was just a consequence to move ahead and start a second company, which is dedicated to the development of individually tailored treatment. 

DAVID GELLES: When it came time to start this company, you mentioned the need to also identify the appropriate technology. And of course, you landed on mRNA as one of the tools that could potentially deliver this radical new vision of truly tailored, customized medicine. What was it about the mRNA technology that you saw even though we didn’t have an mRNA vaccine that was in the wild yet and that was proven effective, what gave you the conviction that it might be the right tool for you? 

ÖZLEM TÜRECI: This conviction, actually, it came very early, in the late 1990s, so many years before we even founded BioNTech. And what we did at that time was to compare those existing technologies which at that time were tried as cancer vaccines, and we also tried them and experimented with them, including mRNA. And what we saw in these comparisons was the huge potential of mRNA beyond those of other technologies, in particular with regard to its versatility. There are so many things you could do with it, if you would optimize it, and that was then the work of many years which followed. And what we also saw was the manufacturing or production aspect, that it could be feasible to be very fast with the production, and at a low cost of goods if optimized. And that’s a very important aspect for making personalized approaches, which is customized, on-demand production of an innovative treatment, viable. And these are the reasons why we first invested many years into this, which only was a vision at that time, mainly optimizing for all this potential, and it worked out. 

DAVID GELLES: In addition to the work you were already pursuing at BioNTech, Uğur, in 2018 you made remarks at a conference that I was able to find where you thought beyond the potential for mRNA technology and what it might do for cancer, and you also addressed what it might one day do in the event of a truly global pandemic. What gave you the confidence and the vision to think even back then that this technology could potentially be used for something—although we didn’t have a name for it then—like COVID-19? 

UĞUR ŞAHIN: At that time point, in 2018, we had already a lot of focus in the cancer field in our personalized cancer vaccines. We had treated hundreds of patients at that time with our personalized cancer vaccine approach and accomplished making vaccines within a few weeks and had seen in cancer patients that we can say that vaccines induce strong immune responses. 

So the question was, what could be the utility of such a technology for the infectious disease field? And we believed that the utility would be to respond quickly to a newly emerging virus, for example in the case of an epidemic. And that was just a theoretical case that I was referring to, but at that moment of course I didn’t know that this could become reality two years later. 

DAVID GELLES: It was early January of 2020 you read this famous article in the Lancet. Will you tell us what you had been thinking in the previous weeks, when I suspect you may have been hearing about what was happening in China and the emergence, the early cases of COVID-19, and then what both of you experienced when you saw that journal article? 

UĞUR ŞAHIN: In mid-January I heard that there is a new outbreak in China with virus, and I was not concerned at that time point because we knew from the past that every year there is a new outbreak with a new virus strain. And I was not concerned. I just thought that this was going to happen and then it will be controlled in the coming weeks or months. 

But on Friday, January 24, 2020 there was an article. It was the first scientific article describing the cases of this outbreak. The article was very informative. And one piece of information in the article was very disturbing, that there was evidence that the virus could spread from asymptomatic people. And the combination, the whole pattern that was described in this paper showed the pattern of an outbreak that is extremely difficult to control. And we got concerned that this is an outbreak which will not stay local, but could become a global pandemic very, very quickly. 

DAVID GELLES: Özlem, was the same thought process essentially going through your mind as you realized the properties that this virus contained and thought about, in the interconnected global world we live in, just how difficult it might be to contain if it truly was as contagious as these early reports made it out to be? 

ÖZLEM TÜRECI: When Uğur presented his thoughts, it was very easy for me to follow what he was suspecting. In fact, the numbers and the mechanisms we discussed made very clear that we probably were already in the midst of a smoldering pandemic. And Uğur came up with two potential scenarios: Either this would be a process in which within basically a few months only, the world population would be quickly decimated; or the other scenario, that it would take one year or so, a slower ramp up, which at the end of the day was what really happened. And so it did not take too much discussion to make clear that we had the obligation to try to contribute to a response, and this response had to be fast because we did not know which of these scenarios would then come true. 

We had the obligation to try to contribute to a response, and this response had to be fast.

ÖZLEM TÜRECI, CO-FOUNDER AND CHIEF MEDICAL OFFICER, BIONTECH

DAVID GELLES: Things did start moving very quickly. Can you talk about those initial few days between when you received the genetic sequence from where you were able to have essentially the data you needed to start developing what might be an effective COVID-19 vaccine using mRNA technology? 

UĞUR ŞAHIN: The genetic sequence of this virus was already available. We downloaded the sequence and asked the questions which part of this sequence could be useful for development of a vaccine. And based on prior applications of a related member of this virus family, we could rapidly identify the spike protein as a candidate, and we also selected domains of the spike protein as potential candidates. And already on the Sunday after, we had designed sequences for our vaccines—eight candidates—that we sent to our collaborators, to our team to start designing and producing those vaccine candidates. And on the next Monday, we just met our team and started to discuss how to execute this project. 

DAVID GELLES: How recently in the matter of years or decades is the rapid development of eight potential candidates—would that have even been possible? I mean, had COVID-19 come around just a decade ago, could you have done the work you did that quickly to identify candidates? Or are we really at this inflection point moment where the technology is finally allowing us to do these rapid responses in a way that just wasn’t possible even a few years ago? 

ÖZLEM TÜRECI: Science and our technology were [only] just now mature enough to show this type of rapid response, and also opening this design space of several candidates, which was necessary because we had so many unknowns, so we had to put a couple of horses into this race. Even twelve months ago, we might not have been in the position to respond this fast. So it’s, indeed, an inflection point. 

Science and our technology were [only] just now mature enough to show this type of rapid response… we had so many unknowns, so we had to put a couple of horses into this race. Even twelve months ago, we might not have been in the position to respond this fast.

ÖZLEM TÜRECI, CO-FOUNDER AND CHIEF MEDICAL OFFICER, BIONTECH

UĞUR ŞAHIN: And what is really interesting is it was just in time. But it was like we had built a plane to fly, but never used the plane to fly an infectious disease vaccine. That means we had never done an infectious disease clinical trial. So we had a number of unknowns. We knew that the technology could work, but we did not have the definitive proof that it’s going to work. And that was, of course, dealing with unknowns. And if you’re dealing with unknowns, you need to use multiple candidates. So we not only generated eight, but more than twenty candidates for a vaccine. 

DAVID GELLES: You were also around this time… establishing your relationship with Pfizer. You had already been working with Pfizer on an influenza vaccine. Talk to us briefly about the foundations of that partnership and what it meant that you already had inroads with a global company like Pfizer at this critical moment. 

ÖZLEM TÜRECI: We were already working with Pfizer. Our flu partnership started in 2018. It was still at the pre-clinical stage, but even though it was just one-and-a-half years working together, we already had a very good understanding of the capabilities of our partner. We knew everyone in the different teams. And we knew that the values were in sync. We had the same values, and in particular, being driven by scientific data. And that was a very good foundation for us after we very quickly understood that this project—Project Lightspeed—would very fast come to a point where we would need a global partner. It was very clear that Pfizer would be definitely the preferred one. And we approached them, and they were open to working with us. 

DAVID GELLES: That summer, though, there was still no guarantee that this would work. What was the most difficult part of that summer and fall of 2020 as the clinical trials proceeded with haste, of course, but still at a judicious pace, and you still had to get to that place where the data told you what we all hoped we would find? What was the most difficult part of the clinical trials and the waiting? 

UĞUR ŞAHIN: One really difficult aspect was the selection of the phase three clinical candidate. You can start with twenty candidates, but at the end of the day you have to decide and select the one which will go into the phase three clinical trial. And even until almost the end of July, we had two candidates which were in the race and we had to make a decision. And actually, the data supporting the decision-making came in just on July 24, and we had a meeting with the colleagues from Pfizer on the same day to discuss all data and we made a decision to select BNT162b2 as a candidate. And a few days ago, the preferred candidate was another one. It was a surprise to their whole team and to the world that we had just selected a candidate for the phase three clinical trial which came in with even better data. 

And then we had then the phase three clinical trials started. We had to wait to get the data. This is a double-blind clinical trial, so that means half of the trial participants got the vaccine and the other half got placebo, and they didn’t know. They didn’t, of course, until the day of evaluation. They didn’t know whether the vaccine would be effective, whether it would be able to prevent infections in a reasonable manner. 

DAVID GELLES: Some would consider a vaccine with 60 percent efficacy a success, 70 percent efficacy a real success. What was your reaction, when I think it was almost exactly a year ago this week if I have the timing right, that you saw the data that it was well over 90 percent effective? 

ÖZLEM TÜRECI: It was an unbelievable moment when we got this data. And you have to imagine it was on a Sunday and we knew that in the afternoon we would get the data, and up to that point there was no way of knowing whether we would see any efficacy at all or whether placebo and vaccine would show the same result. It was—it was a scary day. And then we heard from [Pfizer Chairman and Chief Executive Officer] Albert Bourla that there is efficacy, the vaccine works, and it’s 95 percent, which was first unbelievable and thereafter just wonderful to hear. We felt blessed. 

DAVID GELLES: How did you two celebrate? 

ÖZLEM TÜRECI: We were in a lockdown, so that was not on the table, this option. We treated ourselves to a cup of tea. 

DAVID GELLES: The production was not entirely without its hiccups. What were the major challenges of scaling up the production of the BioNTech-Pfizer vaccine, especially in those critical first months? 

UĞUR ŞAHIN: Usually, if you develop a vaccine, you start preparing the manufacture of the vaccine about two to three years before the vaccine reaches the market. That means the team has a lot of time to improve the manufacturing process, to adapt the details, to scale up the production capacities. And when we started our project in January 2020, we knew that we don’t have this time of three years. We really wanted not only to get an effective and safe vaccine but enable manufacturing and supply of the vaccine worldwide. 

We really wanted not only to get an effective and safe vaccine but enable the manufacturing and supply of the vaccine worldwide. 

UĞUR ŞAHIN, CO-FOUNDER AND CEO, BIONTECH

So that was the reason why we already started in January/February in planning how to scale up our manufacturing. You have to imagine that in 2019—that means a year before this pandemic—our scale for manufacturing was in the range of ten thousand to fifty thousand doses per year, yeah? And in the pandemic, for pandemic supply, of course, we had the aim to deliver at least one hundred million doses. That means both companies, our company and Pfizer were working and scaling up the manufacturing. 

And we had accomplished to produce, to scale up the production of the mRNA which was fully in our hands, but we were also dependent on the scale up of the second step, which is the lipid nanoparticle, yeah, which depends on raw materials from third parties. And during the last step of the scale-up process, we realized that one of the components—that one of the lipids—does not have the quality required to manufacture for supply. That means the team was working day and night for several weeks to identify the root cause and find a solution for that. 

I mean, in that few weeks, we lost the opportunity to produce fifty million doses. So our plan was in 2020 to make one hundred million doses, but we could only produce fifty million doses, which was a setback. But later on, we were able to manage that and to even further increase our manufacturing capacity. 

DAVID GELLES: And today, how many people around the world have now benefited from the BioNTech-Pfizer vaccine? 

UĞUR ŞAHIN: We produced in the meantime 1.8 billion doses that are already delivered. And so we managed to supply about 150 countries and regions worldwide. We have more than 750 million people who already received our vaccine, which is incredible because such a ramp up has never happened in the history of pharmaceuticals. And it just shows how incredible, incredible an accomplishment of our teams, but also with the support of corporation partners is. 

DAVID GELLES: If we all remember from our earlier part of the conversation, it was not infectious diseases that initially intrigued you and was the rationale for even the founding of this company, but it was the potential for mRNA technology to address the Emperor of All Maladies: cancer. Are you still at work on vaccines that could potentially treat cancer? And beyond that, where else do you now see the potential application of mRNA? 

ÖZLEM TÜRECI: We have never stopped. Also during Project Lightspeed, our cancer vaccine programs and treating patients in our clinical trials with our cancer vaccines has continued. It was slowed down by the pandemic as the entire industry has been slowed down with regard to clinical trial conduction, but we have continued and now we are accelerating even those programs, both for our fully personalized vaccines as well as for our off-the-shelf cancer vaccines. 

And not only vaccines; mRNA can, for example, be used to deliver cancer-targeting monoclonal antibodies. What we had done with Ganymed before with conventional technologies—recombinant-protein technologies—we are now using mRNA and ditching the middlemen, meaning the protein-production plants. And the same, for example, for cytokines, which are an important part for immune therapy in cancer. 

And we are going beyond cancer into other infectious diseases which might be much higher hanging fruits as compared to COVID-19. These are diseases which have been with humans for many millions of years—for example, malaria, or tuberculosis, or HIV. 

And this is sort of the first wave. We also want to bring mRNA into indications such as autoimmune diseases because mRNA not only can help to communicate to the immune system to attack, for example, cancers or viruses; it can also communicate to not attack and to calm down, which is needed for autoimmunity or allergy indications, for example. 

DAVID GELLES: What do you now see as you look into the future and think about the potential for us, as a civilization, to treat some of these diseases? What, Uğur, seems possible that didn’t seem possible even just two years ago? 

UĞUR ŞAHIN: The biggest change is that we have been transformed as a company. We had, of course, a bold vision to develop personal cancer immunotherapies, but the innovation of mRNA goes beyond cancer. It is actually what we believe the most important medical-technology progress in the last forty years. So this technology, if combined with the rapidly growing knowledge about diseases about better understanding of the mechanisms, could help us to design treatments for diseases with a high medical need which have not been solved. 

We had, of course, a bold vision to develop personal cancer immunotherapies, but the innovation of mRNA goes beyond cancer. It is actually what we believe the most important medical-technology progress in the last forty years.

UĞUR ŞAHIN, CO-FOUNDER AND CEO, BIONTECH

Malaria and tuberculosis and HIV are examples, but there are other examples. We have, for example, neurodegenerative diseases. We have autoimmunity. We have rare diseases. And what we can also do is to combine this technology with other type of tools—for example, with CRISPR/Cas. CRISPR/Cas could be delivered with messenger RNA. When we combine that with, for example, gene therapy, we could use the technology also for modifying inherited diseases. 

The number of opportunities is endless. And the challenge is, of course, to mobilize the scientific community in a meaningful fashion and engage in collaborations to address all these opportunities in a diligent fashion, because drug development, of course, requires diligence, and it requires several years of development, and it requires also financing. And so we have a lot of opportunities, but there are also a number of challenges ahead to increase productivity of research in the field. 

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Ukraine MPs fight back against fake Covid vaccination certificates https://www.atlanticcouncil.org/blogs/ukrainealert/ukraine-mps-fight-back-against-fake-covid-vaccination-certificates/ Thu, 04 Nov 2021 15:54:48 +0000 https://www.atlanticcouncil.org/?p=453581 As Ukraine grapples with a mounting Covid-19 death toll and low vaccination rates, the country's MPs aim to adopt tougher regulations targeting the thriving Ukrainian black market for fake vaccination certificates.

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In recent months, Ukraine has experienced some of the world’s highest infection and death rates from the ongoing Covid-19 pandemic. Despite this rapidly deteriorating healthcare situation, Ukraine also has one of the lowest vaccination rates in Europe with only around 18% of the population fully vaccinated.

A range of different Covid vaccines are currently available in Ukraine, but efforts to vaccinate the country have run into resistance from a strong anti-vaccination movement. This anti-vaccination sentiment reflects traditional Ukrainian distrust of authority rooted in decades of negative experience during the Soviet era.

Alarmingly, the anti-vaccine mood is also being actively fueled by disinformation originating in Russia. The Ukrainian Security Service recently identified and shut down 5,000 fake accounts linked to Russia that were being used to spread anti-vaccine conspiracy theories among Ukrainian Facebook users. This Russian connection has led many to speculate that anti-vaccination disinformation is now part of Moscow’s ongoing hybrid war against Ukraine.

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As the world watches the Russian invasion of Ukraine unfold, UkraineAlert delivers the best Atlantic Council expert insight and analysis on Ukraine twice a week directly to your inbox.

As the Ukrainian government introduces tighter measures to combat the spread of Covid and restricts access for those who have yet to be vaccinated, a thriving black market in fake Covid vaccination certificates has emerged. With an average price of just USD 75, these falsified documents have become so popular that the trend is attracting the attention of leading international media outlets such as the New York Times.

Ukrainian officials now acknowledge that the spread of fake Covid documents in the country could easily lead to international travel restrictions being imposed on all Ukrainian citizens. With this in mind, the Ukrainian parliament backed the first reading of a new bill on November 2 that will introduce criminal responsibility for the production and distribution of fake vaccination certificates, with penalties set to include dramatically increased fines and the possibility of imprisonment.

The bill has been categorized as urgent and is expected to move rapidly to a second reading within two weeks. Under the proposed new regulations, the fine for anyone caught with a fake vaccination certificate will rise from the present figure of around USD 35 to between USD 650-1300, which is significantly more than the current average Ukrainian monthly salary of USD 530. In extreme cases, those found guilty could also face up to two years in jail.

The envisaged penalties for doctors caught issuing fake vaccination certificates are more severe and include possible prison terms along with fines of USD 1300-2600. Significantly, doctors caught supplying fake documents to the black market will also be deprived of the right to practice medicine for between one and three years. At present, Ukrainian doctors face a possible USD 130 fine, which could theoretically be covered by issuing a few more fake certificates.

Under the proposed new legislation, the harshest penalties will be reserved for those involved in the manufacture and marketing of fake vaccination certificates, with fines of USD 3200-6500 and up to three years imprisonment. These tough measures are designed to target the unethical entrepreneurs who have sought to exploit the pandemic by producing thousands of fake certificates.

Ukraine is not alone in its struggle against a flourishing Covid vaccination certificate black market. Similar moves to tighten criminal responsibility have been introduced elsewhere in Europe over the past year as the vaccination drive has gained ground. Measures adopted across the European Union include steep fines and prison terms similar to those currently being considered in Ukraine.

Will Ukraine’s proposed hard line response to fake Covid documentation prove effective?

Much will depend on the robustness of implementation. Corruption has been an everyday feature of the Ukrainian healthcare system for many years, with patients routinely securing all manner of fake documents from doctors. Such practices now threaten to undermine the country’s efforts to contain Covid, while also posing a risk to the international mobility of Ukrainian citizens.

In theory, high fines and possible prison sentences will deter doctors and members of the public from engaging in the black market for fake vaccination certificates. However, the role of law enforcement and the Ukrainian court system will be crucial in terms of actually imposing these penalties. Many Ukrainians will initially assume that it will be possible to bribe their way out of trouble, as has often been the case in the past.

Judicial reform is currently recognized as Ukraine’s top priority, but there has yet to be significant progress towards a legal environment where all are equal before the courts. This is likely to hinder efforts to clamp down on the Covid document black market and should further underline the urgency of reforming the Ukrainian justice system.

Oleksandra Ustinova is a Ukrainian MP in the Justice caucus of the Holos faction and a member of the parliamentary law enforcement committee.

Further reading

The views expressed in UkraineAlert are solely those of the authors and do not necessarily reflect the views of the Atlantic Council, its staff, or its supporters.

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G20 leaders can rescue low-income countries by redistributing their IMF windfall https://www.atlanticcouncil.org/blogs/africasource/g20-leaders-can-rescue-low-income-countries-by-redistributing-their-imf-windfall/ Thu, 28 Oct 2021 23:52:43 +0000 https://www.atlanticcouncil.org/?p=450369 If the G20 enhances the impact of IMF Special Drawing Rights by sending them on to low-income countries, it could add up to a synchronized global recovery.

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For leaders of the Group of Twenty (G20) nations, this weekend’s summit in Rome presents an opportunity for post-pandemic celebration: Their response to the COVID-19 crisis showcased policymakers’ capacity to transcend politically expedient “beggar thy neighbor” reflexes and instead pursue a cooperative, multilateral approach.

But the festive mood shouldn’t overshadow the need to address the entrenched inequality of the quota-based allocation of special drawing rights (SDRs)—an International Monetary Fund (IMF) composite currency unit that member countries can convert into a freely usable currency to finance imports and other needs.

The G20, which accounts for around 80 percent of global GDP, must enhance the impact of SDRs where they are most needed, such as in low-income countries (LICs). That would set the world on a path toward synchronized recovery in the short-term and global income convergence in the medium- and long-term.

“A historic decision”

In both size and scope, the $650 billion SDR allocation is the international community’s most ambitious response to the pandemic, increasing fiscal space and fortifying global financial stability. It has benefited all member countries and represents the largest such allocation in the IMF’s history—around triple the amount it injected into the international financial system during the 2008 financial crisis.

Across the developing world, the newly issued SDRs will reduce countries’ exposure to exchange-rate volatility and mitigate liquidity constraints associated with elevated balance of payment pressures. This will be especially impactful in Africa, where the allocation could help countries confront myriad challenges, including weathering currency gyrations, replenishing dwindling foreign-exchange reserves (which declined by 27 percent in 2020), and financing essential imports, such as COVID-19 vaccines.

In addition to preventing liquidity crises from morphing into insolvency crises, the SDRs will help sustain investor confidence and enhance the prospects for an inclusive global recovery.

By indiscriminately injecting liquidity into the global economy, the unconditional and countercyclical SDR allocation was always the most cost-effective and low-risk response to the pandemic-induced economic downturn. As IMF Managing Director Kristalina Georgieva said in August: “This is a historic decision—the largest SDR allocation in the history of the IMF and a shot in the arm for the global economy at a time of unprecedented crisis.”

A distribution dilemma

But there is a problem: The global distribution of this financial shot in the arm is just as skewed as the supply of inoculations against COVID-19.

High-income countries that have drawn on effective advance purchase agreements and hoarded vaccines have also received nearly 60 percent of SDRs (or 65 percent when including China). This is despite the fact that they do not genuinely need SDRs, since most enjoy the exorbitant privilege of issuing a reserve currency. Conversely, LICs that do not enjoy the same privileges have been wildly disadvantaged: Only 0.5 percent of vaccines worldwide have been administered in LICs, compared to 77 percent in high- and upper-middle-income countries.

In practice, the effect of the allocation is expected to be more significant in LICs, where limited fiscal space and prohibitively high borrowing costs have limited the size and scope of government stimulus measures. Individually, these countries received a very low volume of SDRs and collectively a lower share (around 3 percent) of the total allocation, setting the stage for a two-speed recovery. Africa, which is home to most LICs, received just 5 percent of the total allocation (around $33 billion). That’s less than Japan and South Korea, which together received more than $37 billion (6 percent), or the European Union, which received $139 billion (21 percent).

The low allocation of SDRs to LICs is commensurate with their share of global GDP, which ultimately determines their IMF quotas. Currently, these nations account for less than 1 percent of global GDP; this partly reflects invariance in the drivers of growth and trade, which remains heavily dependent on commodities. The latest United Nations Conference on Trade and Development’s Commodities and Development Report classifies nearly 80 percent of the seventy low-income countries as commodity-dependent. This production structure exposes these nations to global volatility and adverse commodity terms of trade shocks.

A few high-income countries have pledged to recycle their unused SDRs to increase the volume of concessional lending to the most vulnerable LICs. More countries should support such efforts. A reallocation of around four hundred billion dollars in SDRs to countries that need them most would make a huge difference in terms of economic recovery and structural transformation. By injecting large amounts of investments to set these countries on a robust and long-run growth trajectory, it could also engineer a Big Push green growth development model which would narrow interregional income inequality and accelerate global income convergence.

Big push, big help

Operationally, a shift towards a Big Push model, supported by the effective redeployment of unused SDRs, would help LICs overcome several development challenges, including the unhealthy low-savings and poverty traps. At sufficient scale, this would provide long-term capital to finance the necessary massive investment in critical infrastructure to boost productivity and crowd-in private investment, which will help alleviate supply-side constraints and diversify sources of growth and trade.

The needs of these poorest countries are acute and their financing gaps have been exacerbated by the pandemic, which caused governments to dramatically raise social spending as fiscal revenues shrank. According to IMF estimates, LICs will need around two hundred billion dollars annually until 2025 to bolster their pandemic response—and an additional $250 billon to keep pace with advanced economies that are on a stronger recovery path. Under the best-case scenario of the effective mobilization of resources, LICs would be able to return to their pre-crisis convergence path with advanced economies no earlier than 2023.

In addition to rebuilding external buffers for greater resilience in the face of the looming tightening global financial conditions triggered by heightening inflationary pressures and expectations, the reallocation of unused SDRs could also provide the minimum level of resources for infrastructure investment required for self-sustaining growth. Over time, the growth of public investment and the expansion of industrial production will accelerate the development of regional value chains and create complementary demand—which will ignite a virtuous cycle of sustained and robust per-capita income growth.

The opportunity of injecting large-scale resources in LICs under the proposed Big Push model could transform the collective goodwill borne out of the pandemic into a more inclusive, global economic integration model that blurs the historical divide between developed and developing nations, and between high-income and low-income countries. It has the potential to alleviate climate-related challenges and reduce global income inequality, especially interregional inequality shaped by structural factors, such as sticky colonial development models of resource extraction that sustain commodity dependence.

The Big Push green growth development model engineered by the effective reallocation of unused SDRs could also rebrand the IMF not just as the world’s lender of last resort—but one that engages effectively with regional development banks to meet sustainable development goals.


Hippolyte Fofack is chief economist and director of research at the African Export-Import Bank (Afreximbank).

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Chilean President Sebastián Piñera: COVID-19 solidarity offers hope for tackling climate change https://www.atlanticcouncil.org/blogs/new-atlanticist/chilean-president-sebastian-pinera-covid-19-solidarity-offers-hope-for-tackling-climate-change/ Thu, 23 Sep 2021 01:20:03 +0000 https://www.atlanticcouncil.org/?p=437369 The Chilean leader joined other political, business, and health leaders at the annual conference hosted by the Atlantic Council’s Adrienne Arsht Latin America Center alongside the United Nations General Assembly. 

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In the early days of the COVID-19 pandemic, Chilean President Sebastián Piñera moved quickly to stockpile medical supplies. But the country took its biggest risk in April 2020—investing serious financial resources in deals with a number of companies developing vaccines at an uncertain time, ensuring that Chile would have the vaccine supply it needed at a fair price down the line. 

“We decided that we were willing to risk money, but we weren’t willing to risk lives. That was our philosophy,” Piñera said Wednesday, at the annual conference hosted by the Atlantic Council’s Adrienne Arsht Latin America Center alongside the United Nations General Assembly. 

Now Chile is known as the vaccination champion of Latin America—leading the region (alongside Uruguay) after having vaccinated 72 percent of its population with two doses and about 30 percent with a third dose amid the rise of the delta variant of the virus. 

The region is still reeling from the pandemic: Latin America makes up 8 percent of the global population, yet accounts for 21 percent of COVID cases and 30 percent of deaths. As regional leaders came together at Wednesday’s conference to outline a path toward a health and economic recovery—while showing how the fate of Latin America and the Caribbean has far-reaching ramifications for the world—Piñera saw hope in this solidarity for solving any number of global challenges, from strengthening democracies to addressing income inequality and tackling climate change. “Despite all the problems,” Piñera said in the conference’s keynote address, “the best is yet to come.”

Read more of the most valuable insights from the discussion below.

Fighting for equity and health

  • Costa Rican Vice President Epsy Campbell-Barr reported widespread, equitable distribution of diagnostic tests and vaccinations regardless of class in her country. However, she has seen limited effects from the COVID-19 technology access portal—the “CTAP” effort backed by forty nations and the World Health Organization meant to spread the vaccine more equitably across the world—because large countries and major pharmaceutical companies hadn’t joined while trying to protect trade secrets and patent exclusivity rights. “It is insufficient if we feel we can work only with countries who have more money, and leave behind the countries that are the poorest in the world,” Campbell-Barr said.

  • Without a more equitable approach, the world will find it difficult to leave the COVID-19 pandemic behind, said Carla Vizzotti, Argentina’s minister of health, which has enough vaccines through current agreements to inoculate 69 percent of its population and is currently experiencing some of its lowest COVID-19 case and death rates since summer 2020. She warned that an uneven re-opening of economies would only exacerbate long-term inequalities between Latin America and other regions, calling for more direct donations of vaccines from wealthy nations. “The reality is that the access to vaccines has not been equal,” she said.

  • Campbell-Barr also highlighted the challenges in vaccinating migrant populations. Their quality of medical care has been impossible to track, because Costa Rica doesn’t currently log their immigration status when administering vaccines. Plus, they face many of the prejudices asylum-seekers face worldwide—including erroneous accusations that they are responsible for spreading disease, taking jobs, and increasing crime. “It is essential to have data on the number of migrants, as well as their epidemiological profiles,” Campbell-Barr said, while urging other nations to fight the politicization and stereotyping of asylum-seekers. 

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How the comeback takes off

  • Expect to hear a lot about near-shoring in the near future, with deep ramifications for both Latin America and the United States. The pandemic exposed weaknesses in global supply chains, versus commerce relying on sources closer to home. “We see Europe; they’re integrated. We see Asia integrated. We don’t see Latin America very integrated,” said José Varela, president of 3M Mexico. “Many companies are looking to invest closer to the US.… Latin America and the Caribbean are well-positioned to take advantage of this opportunity,” added Carlos Felipe Jaramillo, who is the World Bank’s vice president for the region.

  • The pandemic also underscored the importance of trade agreements in national security, as the disruption of global trade suddenly presented a major threat to domestic health in many parts of the world. “Without access to vaccine imports, additional doses wouldn’t be possible” for many countries, said Anabel González, deputy director-general for the World Trade Organization. That has led to key adjustments in Latin American nations, González said—including reforming export restrictions and encouraging greater voluntary licensing and technology transfers—as well as ambitious policy reform around biodiversity in Costa Rica and green jobs in Ecuador. Despite early setbacks during the pandemic, she said that Latin America and the Caribbean has much to offer and can set an example in numerous areas for the accelerating global recovery.

  • All three economic experts agreed that the past year has greatly accelerated digital adoption in Latin America, where only about half of the population has consistent internet access. “There is a huge business opportunity for those interested in this growing market, at a time where governments have realized the importance of connecting people to digital tools—and are willing to pay some of the costs of the last mile of incorporating rural, poor populations in this ongoing digital revolution,” Jaramillo said. Latin America can build on that progress by tackling longstanding barriers, González said, such as cumbersome regulations.

The Chilean example

  • Chile is continuing its aggressive inoculation plan, now vaccinating children 6 years old and up with the Chinese Sinovac vaccine, with plans to soon start vaccinating kids as young as 3. “You cannot avoid the virus entering the country. The only thing we can ensure is that we are well-prepared for when that happens,” said Piñera, who credited his country’s high vaccination rates for mitigating the damage of the delta strain.

  • Throughout his address, Piñera emphasized his trust in the science behind the vaccine—while underscoring his disappointment in many global leaders. “This pandemic has been a huge success of science and a great failure of politics,” Piñera said. “The citizens are asking us political leaders to act, and they are asking that as a moral imperative.” Piñera said that Chile has tried to lead by example, donating vaccines to countries in greater need, even as supplies were scarce: “Solidarity is very important.”

  • Piñera directly tied trust in the science behind the vaccine to trust in the science behind another great global threat—climate change. “The science has spoken loud and clear,” Piñera said. “Technology gives us the tools and instruments to change the course of history. Now it is our responsibility to take the climate change threat seriously… otherwise, nobody will forgive us.”

Nick Fouriezos is an Atlanta-based writer with bylines from every US state and six continents. Follow him on Twitter @nick4iezos.

Further reading

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EU Commissioner Thierry Breton: Trust in the US ‘has been eroded’ https://www.atlanticcouncil.org/blogs/new-atlanticist/eu-commissioner-thierry-breton-trust-in-the-us-has-been-eroded/ Wed, 22 Sep 2021 01:02:50 +0000 https://www.atlanticcouncil.org/?p=436840 Breton outlined developments in the European Union’s vaccination efforts, digital policy agenda, and cooperation with the United States.

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On Tuesday, European Commissioner for the Internal Market Thierry Breton joined the Atlantic Council to outline developments in the European Union’s vaccination efforts, digital policy agenda, and cooperation with the United States. Below, edited for length and clarity, is his conversation with Ben Haddad, the director of the Europe Center, and others at the Atlantic Council.

FREDERICK KEMPE, president and chief executive officer of the Atlantic Council: Today, you’re in the United States for discussions with the White House on launching the US-EU COVID-19 Taskforce. Your visit comes alongside notable developments within the European Union (EU), including the European Chips Act that EU President Ursula von der Leyen announced at her state of the union, the launch of the Health Emergency Preparedness and Response Authority, and of course the EU’s continued work on new rules for the digital space.

THIERRY BRETON: This visit is pretty timely. I did not anticipate this, but it’s after the withdrawal of the US troops from Afghanistan and the AUKUS deal between the United States, Australia, and the United Kingdom—which, by the way, happened on the very same day that Europe announced its own Indo-Pacific strategy. I think nothing happens by [accident] in our world. It is true that some see this in Europe as a wake-up call.

To tell you the truth, I planned this visit many weeks ago, with of course a very positive agenda: to deepen EU-US cooperation, which is something that I believe I do pretty well, and I like to do it because I know the benefit of this partnership; to strengthen our supply chain; to fight together against a global pandemic; to invest the right way in our technological landscape; and to regulate, in an appropriate way, our digital space. And while all of this is still very much on the menu, and I have had very constructive meetings here these days, something else changed.

There is, indeed, a growing feeling in Europe—and I say this with regret—that something is broken in our transatlantic relations. A partnership works when both parties are honest and truthful with each other, when both parties treat each other with respect, and when both partners are strong—and, of course, when there is trust. But, of course, we are not naïve. Trust is not a given. And after the latest events, there is, I should say, a strong perception that trust between the EU and United States has been eroded. So it is probably time to pause and reset our EU-US relationship. But let’s review it case by case, and I will start, if you allow me, with the fight against the global pandemic.

There is, indeed, growing feeling in Europe… that something is broken in our transatlantic relations.

Since the beginning of the COVID-19 situation, we have learned the hard way that no single country—in fact, no single continent—can fight a global pandemic alone. Today the EU and United States account for more than half of all the vaccines produced and delivered around the world. And almost all mRNA vaccines are done by us. If global manufacturing capacity skyrocketed, it is of course thanks to us.

Yesterday’s decision to lift the US travel ban on fully vaccinated Europeans is welcome. But let’s be honest—we should have done this before because at the end of the day, Europe is the first continent in terms of people being vaccinated, so it’s true that we did not understand very well why we were in the same list as Iran, Brazil, China, and so on. But it is a good thing that it’s done now. I’m extremely happy for all these families who will be able to be together again.

I should say that in fighting the pandemic, Europe has lived up to its responsibilities. Large amounts of vaccine precursor material have been shipped from the EU to the United States, allowing the United States to boost its vaccine production. And more importantly, the EU has exported half of its own production to support and vaccinate more than one hundred countries. We have been the only one to do this.

Now, if I may be frank, when the US government deployed the Defense Production Act earlier this year, it created concrete tensions among the EU-based vaccine producers regarding the availability and the access to key materials, and it is only when the EU put forward our export authorization scheme that we were able to engage back with our US friends in a frank and operational dialogue to unblock supply chains, ingredient by ingredient, product by product, producer by producer; and I did it with my team. By the way, thanks also to the cooperation of people that we had on the other side like [Counselor to the US President] Jeff Zients.

We’ll, of course, continue working with the United States on securing vaccine production, like when yesterday, we marked the first official meeting of the joint task force on COVID-19 manufacturing supply chains, together with my counterpart, Jeff Zients.

Let’s not forget that the EU and United States, of course, only represent 10 percent of the population of our planet, and to eradicate the virus and its variants, we need to sustain these efforts, not only for ourselves but now for the rest of the world. And that means continuing to export and helping other continents develop their own production facilities so that we accelerate the pace of global vaccination.

Let’s move now to technology and investing in technological leadership. Revisiting our supply chains, avoiding vulnerabilities, and making the right investment to our citizens—this must also be done in new technologies in which the EU and the United States share common dependencies on other countries.

Take semiconductors, for example, where technology and geopolitics are increasingly hard to separate. The global shortage is affecting many industrial sectors across the globe and, therefore, the daily life of our citizens. Today, for example, 80 percent of global semiconductors production is located in Asia—and we know, of course, the role of Taiwan—while Europe and the United States hold 10 percent each from each side of the Atlantic.

We, therefore, need to retake control and rebalance the global supply chains of semiconductors. Last week, President von der Leyen announced the launch of the European Chips Act, which aims to turn our scientific and research excellence and untapped capacity into industrial leadership.

Those who think it’s just about regarding the United States are wrong. It is about technological sovereignty, about having enough autonomy to make the right choices for Europe. To do this, we must strengthen our industrial capacity in Europe. It is not a question of wanting to produce everything we need in Europe. We need to diversify our supply chains in order to decrease overall dependencies on a single country or region.

And while the EU aims to remain the top global destination for foreign investment, we also need to make our local productions more resilient and preserve, of course, Europe’s security of supply.

I spoke earlier about how our successful partnership requires both parties to be strong. Well, let me be clear on this. In a world of growing uncertainties, it’s in America’s best interest to have a strong and sovereign Europe as partner. This is what I said to US Senator Mark Warner (D-VA) yesterday and what I will convey today to US Secretary of Commerce Gina Raimondo.

In a world of growing uncertainties, it’s in America’s best interest to have a strong and sovereign Europe as partner.

It is also in this spirit that I am approaching the discussion in the EU-US Trade and Technology Council. Certainly, Europe and the United States have a lot to cooperate on in tech, and as a tech commissioner, I very much value partnerships, of course, and I know that in technologies, this is paramount.

Partnerships are built by combining respective strengths on several tech issues, including semiconductors. I see pretty well where Europe’s strengths lie, including, of course, our added value. I have yet to understand what the United States will bring to the table.

Despite what some may think or wish, this discussion is not about classical trade negotiation with gives and takes; it is about our future industrial position. Europe has to and will carefully assess its interests also in the light of the new geopolitical realities.

[We have] a common challenge in regulating the digital space.

You all know that on both sides on the Atlantic, we have been exposed to the war of the [social media] platforms and the consequences, like fragility, in our democracies and also to the threat that underregulated tech companies can pose to the survival of these threats through the spread of disinformation or hate speech. And I think we are at a moment now where the United States and the EU have an opportunity to reestablish global standards for balanced digital regulation that counters illiberal practices.

Europe is doing its fair share. We are moving fast and first with the Digital Market Act and the Digital Services Act. We wanted to ensure a safe, fair, competitive, and innovative digital economy. And these objectives stemmed from the same principle and values that the US cherishes: free speech, consumer protection, safety of minors, open markets, and rule of law.

Obviously, upholding these common values in the digital space also means stepping up our game on cybersecurity. And here, again, not one of us can do it alone. The EU and the United States face the same cybersecurity threat, and we must therefore unite our efforts to combat ransomware, impose cybersecurity, protect information sharing, and establish supply-chain security including 5G, critical information-and-communications-technology supply chains such as the cloud. And these technologies will be, of course, absolutely essential for our safety prospects and resiliency to come.

And I just want to conclude now to tell you that with the pandemic, the technological race, and ongoing conflicts, yes, we can say that times are volatile. And no one is at the center of the planet. So cooperation is absolutely key. In the EU, we remain open but on terms and conditions we set ourselves for protecting Europe’s strategic interest such as our security of supply, and this is also true in the field of security and defense.

I firmly believe that a common defense for Europe is the way forward. It is not about rejecting our historical alliances. On the contrary, it is about being able to act on our own when needed when these alliances are not ready or able to do so. Be it on industrial production, technology, or different strategic autonomies about ensuring Europe’s freedom and capacity to act, it can only strengthen our ties and our common endeavor to create a better world together.

A common defense for Europe is the way forward. It is not about rejecting our historical alliances. On the contrary, it is about being able to act on our own when needed when these alliances are not ready or able to do so.

BENJAMIN HADDAD: You just briefly mentioned it: We’re here in difficult times in the transatlantic relationship. You said something is broken. You talked about a pause and reset and a wake-up call. What’s next? Where do we go from there in the relationship between the EU and the United States?

THIERRY BRETON: Well, there is a growing feeling in Europe that something is wrong. It’s a feeling. It’s a feeling within our citizens. It’s a feeling within some member states. And the strength of our partnership is extremely important and paramount.

Take, again, the vaccines. We are not yet done, but if we are where we are today with almost 70 percent of the adult population vaccinated from both sides of the Atlantic—although we know that we still have to move ahead—it is because of the cooperation between Europe and the United States. And when I say cooperation, on the six vaccines working today, five have been developed in Europe by scientific researchers funded by European money. We put this together. It’s really, I should say, in terms of science and technology and industrial capacity, it’s a European-US partnership success.

We need to continue this because we know that if (hopefully) at the end of the year everybody is fully vaccinated on both sides of the Atlantic, it will represent 10 percent of the population. And we need already to take care of the rest of the world and discharge our responsibilities. This is why it was very important yesterday, together with Jeff Zients, to continue the work that we have done. We worked extremely well together with our joint team, where it had been decided last June between US President Joe Biden and President von der Leyen to create, together, a joint task force. We have been working together already for the past year or so. We know how to do this very well, but it’s important to continue to enhance it for us, and for the rest of the world.

Same thing, for example, for the fight against climate change. That’s extremely important. We know that our partnership will lead (hopefully) a successful effort, and there’s a lot of challenges if Europe and the United States cooperate. And for the rest, we have also all sorts of challenges. I hear that some of our member states in Europe say that maybe we need to pause after Afghanistan, after the ban that nobody understood, after what happened last week, or this new AUKUS. I mean, there are these voices, and that’s a political reality. Of course, personally, I regret it. I hope that we’ll be able to work again in good spirit and in trust. Because at the end of the day, we are allies. We have been allies for decades. We will be allies for decades. But we want everybody to be reminded of this on both sides of the Atlantic. And by the way, regarding China, we know that China is our systemic rival.

BENJAMIN HADDAD: I want to continue on the concept of strategic autonomy. You made an impassioned plea for it, and you’ve been vocal with some of your EU colleagues on this concept. We heard you also after the lack of consultation after the Afghanistan withdrawal. This is a concept that’s often misunderstood both in the United States but also in some parts of Europe where it’s seen as breaking away from the alliance, independence, or equidistance between the United States and China, for example. What do you say to those voices that are afraid of Europe’s path to strategic autonomy?

THIERRY BRETON: Well, you know, we are politicians. And in politics, words are important. And it’s true that the European Union is made up of twenty-seven countries. We align our global interests more and more, which is good, but we have our own futures, our own histories. This is what makes Europe. And this is also maybe why we are one of, if not the, most advanced democracies on the planet. And it’s difficult. And it requires a lot of capacity to listen to everyone. And when you speak of sovereignty or strategic autonomy, this resonates differently in different parts of Europe. That’s true.

So this is why, instead of using words, I prefer to use a full sentence. Saying, for example, that what we believe and what we learn every other day, including with what happened in our relations over the past few weeks and months, is that in some areas, we need to be able to make our decisions and to monitor our destiny ourselves. Look at the vaccine. Believe me, I have been in charge, and what I realized is that suddenly, the supply chains were blocked between the EU and United States. Never in my life did I think I would have to cope with this situation.

It has been painful. What did we learn? Continue to cooperate and also to increase our ability to secure our own supply. It’s the same thing in some areas in defense and the same thing in some areas like in semiconductors, in technology. It doesn’t mean that we want to do everything on our own. It just means that we need to take the decisions together. When we believe it is crucial for Europe and our fellow citizens, we need to secure some areas where it’s critical because sometimes even our strongest ally will not be able or not willing to do what is needed for us.

Sometimes even our strongest ally will not be able or not willing to do what is needed for us.

BENJAMIN HADDAD: And as you said earlier, a strong and sovereign Europe would be also in the interest, of course, of the alliance.

THIERRY BRETON: Like always in partnership, you need to have a strong partner. We will be partners for decades, but I think it in this complex world, it is definitely in the interest of our US friend to have a strong ally in Europe.

BENJAMIN HADDAD: I want to turn a little bit, talk about technology and digital issues. There have been some rumors about whether the EU-US Trade and Technology Council, which the first edition was supposed to be hosted in Pittsburgh I think later this month, could be paused. Do you have any comment on that?

THIERRY BRETON: No, I don’t have any comment and I don’t have any information on that. But you know, as the co-chair of the meeting mentioned, she said nothing breathtaking from this meeting is what she expected, but we’ll see. I don’t have any information.

BENJAMIN HADDAD: I’m going to turn to Fran Burwell.

FRANCES BURWELL, distinguished fellow at the Atlantic Council’s Europe Center: You are often regarded in the media as the champion of digital sovereignty in the European institutions. On this side of the Atlantic, I think that we’re still not always sure exactly what digital sovereignty means and what it requires in a policy approach. What does it mean to you? How do you define it? And what does it bring as far as the risk of protectionism? Will it require excluding others to build European capabilities? And here I would point to the Digital Markets Act, which you mentioned, and the widespread assumption right now that the gatekeepers and the way they’re defined would apply primarily, if not only, to US companies. Are US companies in a special category compared to other non-EU companies when you think about digital sovereignty? Could you help us understand this concept?

THIERRY BRETON: We must refer to the author of the term. I’m not the author of “digital sovereignty.” It is German Chancellor Angela Merkel who is the author of “digital sovereignty.” And by the way, when Chancellor Merkel was leading Europe six months ago, she put digital sovereignty, and she explained what she means by digital sovereignty, on the top of the list of our agenda. So I just propose that you see what she means by that, and as I’m in charge of digital in the Commission, I refer to her statement. But you will understand while reading what she means in that in some areas we need to keep our capacity to act on our own.

Let me give you an example. I have been also minister of finance, but I have also led some big tech companies, including in telecom. And I should tell you that it is a huge concern in Europe, especially for companies, to understand what will happen with their own data. We all understand the USA PATRIOT Act. We all understand the US CLOUD Act. For example, digital sovereignty means, of course, to be able to tell exactly to our companies what happens to what is most important to them: their data. But of course, it doesn’t mean that no one could come. We welcome everybody.

And you know, all my life, I did that. We have rules. We have to be clear in our rules. Everybody will have to understand our rules. My mission is to make sure that they are simple, they are readable, visible, and last for long. So that’s basically what we mean by this.

Now, regarding the Digital Markets Act, I could reassure you, this targets no one. This is really something not against but for Europeans. It is my job. My job is to make sure that I’m working for European growth, European competitiveness, European companies. That’s my job. And of course, in this, we welcome everyone. But it’s true that we decided that—and, by the way, this is the exact same situation in the United States—but some companies are so big now that they maybe sometimes act as gatekeepers. And you mentioned some US companies. We don’t have only US companies in the world. We have also other companies, big companies in Europe, big companies in Asia, big companies in China. And it is exactly these companies that are being taken into consideration in the DMA. But I assure you, there’s nothing against any one person, and especially not in the United States.

BENJAMIN HADDAD: I want to continue on this question of digital sovereignty and the DMA and DSA. The EU has really risen as a global standard- and norms-setter on the international stage on digital issues. And there are plans on artificial intelligence, for example. But it hasn’t been the innovative superpower that others, like especially in the United States, are. Could there be a form of tension between the two? Can we regulate without innovating? And in a way, who really shapes the norm? Is it the innovator and the creator, Silicon Valley, for example? Or is it the regulator who’s reacting to the technology?

THIERRY BRETON: Let’s be honest: It’s a discussion about how to behave in the digital space. It’s not a European discussion. It is a discussion extremely vibrant here in the United States—with, by the way, more radical proposals that are here, including in the US Senate. That’s what we need. This is just a normal discussion that we need to have as policymakers because guess what? Our children spend as much time in the digital space as in the physical space. And we see that there is no regulation here to protect our children, to protect our democracy—and I want to come back on January 6—to protect what we cherish.

So what we said is something extremely simple, that everything that is authorized in the physical world should be authorized in the digital world. But everything that is forbidden in the physical world has to be forbidden also in the digital world. This is exactly what is the DSA about—nothing more, nothing less. And I strongly believe that it’s not about regulating for the sake of regulating. I have been a chief executive officer all of my life. I have been a professor at Harvard teaching in the Harvard Business School, even. But I know also that it is our job to propose this.

And by the way, before preparing this, we are the only continent to have asked (for almost one year) to the planet: What do you believe? We had three-thousand contributions—a lot coming from United States, from governments, from countries, from nongovernmental organizations, from everyone. And we took time and we worked. And we believe that what we propose is pretty balanced. And, by the way, maybe it will give some ideas to our US friends.

BENJAMIN HADDAD: Here’s an important question from Lara Jakes, who’s a New York Times correspondent: Why is the EU opposing the waiver on intellectual property rights on vaccines?

THIERRY BRETON: No, I think it’s a misunderstanding. First, I should say that we have more or less six vaccines, maybe seven vaccines, which are really working. We have mentioned four of them have been developed with patents in Europe, two in the United States. So it’s not a question about patents. I should tell you that being in charge for our continent of the ramping up of the industrial capacity, it is definitely a problem of industrial capacity and infrastructure.

We initiated with Team Europe the first manufacturing fabrication plant for a vaccine in Senegal. I mean, it’s a very complex process. It takes time, but we need to do this. Before giving the patent freely, we need to organize ourselves. Where do we believe it’s appropriate to have these facilities? You need, of course, infrastructure there already.

Why Senegal? Because for eight years, Institut Pasteur was already in Senegal, and that Senegal is making the yellow fever vaccines for the planet. So they have skills. They have supply chains. They have networks. They have an ecosystem. But it’s very difficult and it takes eighteen months to do this.

And then, of course, will come the time to determine whether the lab will come or the company, and under which conditions? But we cannot wait. If you say I give you the patents and you do not wait… it’s reminding me of the Russian Sputnik vaccine, so-called Sputnik V. Russians were saying it’s great, it’s a great vaccine, and so on, and you could get it, you can get it. And at the end of the day, we realized that it was extremely difficult for them to manufacture this vaccine—just to make it, you know, manufacturing in a plant—because it’s extremely complex.

So that’s why doing step by step in terms of vaccines and in terms of the capacity to do what we have to do [is important]. First, we open our border for, let’s say, a year. We have been the only one to be able to vaccine the rest of all our allies, all the NATO allies, and the United States was closed. And it has been painful and difficult, but we did it. And we did it with half of our production. And it was difficult for our population to explain that it was our mission to do this, not to close our borders.

Second thing, to get ready to share vaccines, since this is the most important thing. Because now we need to be able to vaccinate our population, and we cannot wait two years. And at the same time, [we need to] start to identify how to help these countries in Africa, in South America, and elsewhere to start to build their own capacity. And then will come this question at the end of the day, but it will be important.

We need to be able to vaccinate our population, and we cannot wait two years. And at the same time, [we need to] start to identify how to help these countries in Africa, in South America, and elsewhere to start to build their own capacity.

But do it step by step. Open your border. Give the vaccines. Try to identify where to build these factories.

EU did export more than half of its vaccine production, more than half, to more than one hundred countries: Canada, Mexico, all our NATO allies, everybody—Japan, Israel.

BENJAMIN HADDAD: Let me turn to my colleague Julia Friedlander, who is the Boyden Gray senior fellow and the deputy director of our GeoEconomics Center here at the Atlantic Council.

JULIA FRIEDLANDER: Regarding the EU Chips Act that President von der Leyen has announced and you yourself outlined for us on LinkedIn, and how will funds be appropriated among member states given the heterogeneity of national economies to promote technological development in this area? I mean, we’re having enough trouble with that, thinking about how we’re going to roll it out in the United States on a state level.

And maybe a little bit more broadly and philosophically, how do you view economic competitiveness, either driven by markets or by the state, as an element of national security policy? And I think that drawing that line, is crucial for working with the United States because those are the terms that the Biden administration is using.

THIERRY BRETON: To the first question, you’re absolutely right. By the way, I was yesterday meeting with Senator Warner. He is, as you know, chairing the Intelligence Committee in the Senate, but he’s also the sponsor of the US CHIPS for America Act. And we were discussing this—exactly this question together.

First, President von der Leyen announced this EU Chip Act. It is—the allocation is almost the same as that in the United States. Fifty-two billion dollars for the United States. It’s, roughly, the same figures for the EU together with our member states. So we are discussing a comparable amount of money, which is important, of course.

The second thing, of course, is that we have to be careful here because we will use public money, of course, and it means that we have to be extremely cautious, and especially for us in Europe, in order to make sure that we want to align everybody.

So we have created a semiconductor alliance. In other words, we put together everyone as a participant of the semiconductor ecosystem. When I say everyone, we invited, of course, all European companies. We invited the research and development centers. We invited everybody. It could be member states, who we believe have something to say here, and to be part of it.

And then, of course, we are deciding now on our strategy, and the strategy should be simple to explain. For us, it is, first, to increase the capacity of production to leverage, let’s say, in the next ten years. The US strategy is to triple it. Together, the United States and the EU should be able to have together the capacity to produce 50 percent of what the world needs in semiconductors by the end of this decade, 30 percent by the United States and 20 percent for us.

The second thing is, of course, to know how we will be able to support this investment, which is needed, and for us, of course, it means that we are welcoming foreign investment. We are welcoming any kinds of companies. To tell you the truth, I’m in discussions with a lot of US companies. We are discussing also with Asian companies. And at the end of the day, it’s important to discuss what to do with it and what kind of technology we want to use.

So we have now a particular agenda or roadmap. And that’s something that we can offer, of course, to non-EU partners to make sure that they will contribute with our own conditions in terms of security of supply in mind, which is, as you could imagine, extremely important.

Then we have to avoid the kind of race for subsidies between one country or the others, and that’s something that was a concern with a discussion I had yesterday. Maybe I will have this discussion again this afternoon with Secretary Raimondo. So we need also to see how we can organize this.

So last point for us is to be able to coordinate even better our research and development. We have extremely strong research and development centers in Europe and, of course, we want to be able to align all our strengths here.

So that’s a lot of work. But it’s interesting also to exchange here our views with our US partners.

The second question about national security policies, that’s a very important question. When I joined as the commissioner in charge of digital, I had to cope with the 5G story and question, and you remember it was high on the agenda of the previous administration, the Donald Trump administration. And then from the US part, it has been: This company is forbidden, period. I will not give you the name, but you will recognize it probably.

For us, we took a totally different approach. We met, and I did it with my team, all member states. We decided to define the criteria, which were extremely important, to protect our national interest in 5G deployment, and we know that we have a lot of risk here. We put this in a 5G toolbox that everyone agreed and supported. And, of course, we said then, which is true, everybody is welcome, of course, to come to invest in Europe—as long as you fulfill with these requirements.

In other words, we say: If you fulfill, you are not a high-risk supplier. If you don’t fulfill, you are considered as high-risk suppliers. And we have been able to find our ways. So that’s the European way.

Watch the full event

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State of the Order: Assessing July 2021 https://www.atlanticcouncil.org/commentary/blog-post/state-of-the-order-assessing-july-2021/ Tue, 10 Aug 2021 16:04:54 +0000 https://www.atlanticcouncil.org/?p=421721 The State of the Order breaks down the month's most important events impacting the democratic world order.

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Reshaping the order

This month’s topline events

Nord Stream Fallout.  On the heels of German Chancellor Angela Merkel’s visit to the White House in July, the Biden administration reached an agreement with Berlin that assumes completion of the Nord Stream 2 gas pipeline between Russia and Germany and outlines ways to mitigate its risks. The US previously threatened sanctions against Berlin if it moved forward with the pipeline, which Poland, Ukraine, and other eastern European nations fear could expand the Kremlin’s coercive leverage against them. Under the agreement, Germany agreed to invest in Ukraine’s green technology infrastructure and work with the United States on initiatives to diminish Russia’s energy dominance in Europe, including sanctions should Moscow commit further aggression against Ukraine.

  • Shaping the order. The agreement sets aside a thorny issue in the US-German relationship that could facilitate closer cooperation on other shared challenges. But completion of the pipeline, which was strongly supported by Russian President Vladimir Putin, could allow Russia to double gas flows to Germany, increasing Berlin’s dependence on Russian energy, and to bypass pipelines under Ukrainian government control, giving Moscow greater leeway to act against Ukraine without concern over its gas exports being cut off.
  • Hitting Home.  America is less secure when its closest allies increase dependence on autocratic rivals such as Russia for their energy needs.
  • What to do. The agreement outlines steps to limit Russia’s ability to use energy as a weapon, but further discussions will be needed to develop actionable strategies to achieve this outcome. At the same time, the US and Germany, along with the EU, other G7 or D-10 allies, and key stakeholders such as Poland, should launch a multilateral strategic dialogue on longer-term options for reducing European dependence on Russian energy sources.   

The CCP at 100.  Marking the 100th anniversary of the Chinese Communist Party on July 1, Chinese President Xi Jinping touted the success of “socialism with Chinese characteristics,” while reaffirming the party’s “unshakeable commitment” to preventing Taiwan’s independence, and warning that foreign powers that try to bully China “will crack their heads and spill blood against a Great Wall of steel.” Xi later pushed back against US-led efforts to advance a democratic world order, asserting that there are “different pathways toward well-being” and that other nations “should not seek world hegemony through small-group politics.”

  • Shaping the order.  Xi Jinping’s strident and defiant remarks highlight China’s increasing confidence in its autocratic system of governance and perception that it is superior to that of liberal democracy. As the Biden administration frames its strategy around a global struggle between democracy and autocracy, the CCP also appears to be positioning itself to engage in a systemic competition with the US, while taking aggressive action to crack down against any perceived domestic threats to its political dominance.
  • Hitting Home.  A long-term struggle between the US and China could have significant economic implications for American businesses, including a need to diversify supply chains over time, especially with regard to sensitive technologies.
  • What to do.  Washington should develop a coordinated strategy with its closest democratic allies that includes the establishment of new entities to strengthen cooperation and defend against China’s actions to undermine democratic norms. At the same, the US and its allies should continue to engage with Beijing on issues where cooperation appears feasible.

Pandemic Revival.  Spurred by the highly infectious Delta variant, first identified in India, coronavirus cases surged once again in the United States, Europe, and across much of the globe. The spread of the variant outpaced vaccine distribution, prompting the return of mask mandates and further restrictions in many communities, as a growing number of breakthrough cases among those already vaccinated also raised concerns. 

  • Shaping the order.  The revival of the pandemic could slow the pace of the global economic recovery that was well underway as the virus appeared to be increasingly contained. With vaccination rates slowing in the United States, the rise in cases also highlights the challenges facing democracies on how to encourage those reluctant to get vaccinated – allowing communities to reach herd immunity and preventing the emergence of more lethal variants.
  • Hitting Home. With only about half of all Americans fully vaccinated, the number of coronavirus cases in the United States approached 100,000 per day in late July.
  • What To Do.  The Biden administration should continue to work with state and local health officials to incentivize vaccinations, while following through on pledges made at the G7 summit to expand the distribution of vaccines to developing countries worldwide.

Quote of the Month

“The foundation of our relationship is a shared commitment to democratic principles, values, and institutions. Together, we will uphold the rule of law, promote transparency and good governance, and support civil society and independent media…. We must act now to demonstrate that democracy delivers for our people at home and that democratic leadership delivers for the world.”


– The Washington Declaration, issued by US President Joe Biden and German Chancellor Angela Merkel on July 15, 2021

State of the Order this month: Weakened

Assessing the five core pillars of the democratic world order    

Democracy ()

  • Tunisian President Kais Saied suspended parliament, dismissed the country’s prime minister, and seized executive power – actions that opposition leaders likened to a coup and that threatens to undermine Tunisia’s promising democracy, ten years after the toppling of dictator Ben Ali at the beginning of the Arab Spring.
  • Cuba witnessed the largest anti-government demonstrations in decades, with protesters chanting for “freedom” on an island that has been under communist control since 1959. But Cuban president Migel Diaz-Canal responded quickly with mass arrests, surveillance, and harassment of protesters.
  • Citing potential voter fraud, Brazil’s authoritarian President Bolsonaro stated he may not accept the results of the next presidential election, slated for October 2022, if he loses – prompting concerns that Bolsonaro may be seeking to borrow a page from US President Donald Trump.
  • Haiti’s embattled president Hovenal Moise was assassinated on July 7, apparently by hired mercenaries — a serious blow to Haiti’s fragile democracy, already challenged from Moise’s reported ties to gangs and corruption.
  • According to an investigation by the Pegasus Project, a highly invasive spyware licensed by an Israeli firm to governments for tracking terrorists and criminals was used to surveil smartphones belonging to journalists, opposition leaders, human rights activists, and business executives, including those located in Hungary, India, Mexico, and Saudi Arabia.
  • Given several setbacks, the democracy pillar was weakened.

Security ()

  • With US and allied troops ramping up their withdrawal from Afghanistan, the Taliban seized control of more than half of the country’s local districts, potentially threatening the stability of the coalition-backed Afghan central government.
  • President Biden and Iraqi Prime Minister Mustafa al Khadimi signed an agreement to end US combat operations in Iraq by year’s end, though US troops will continue to operate in a train and assist mission going forward.
  • The United States and Britain blamed Iran for a drone attack off the coast of Oman against an oil tanker operated by an Israeli firm, killing two people, an attack which UK Foreign Secretary Dominic Raab described as a “deliberate, targeted, and a clear violation of international law.”
  • Vladimir Putin published an article arguing that Russians and Ukrainians are “one people” and that true sovereignty for Ukraine “is possible only in partnership with Russia,” a claim that could lay the basis for future incursions by Moscow against Ukrainian independence.
  • Beijing is developing more than one hundred new intercontinental ballistic missile silos in northwestern China, indicating a major new effort to strengthen its strategic nuclear capability.
  • US Deputy Secretary of State Wendy Sherman met with Foreign Minister Wang Yi and other officials in China with the aim to set “guardrails” around the increasingly contentious relationship between both countries and “keep the channels of communication open.”
  • The United States, joined by a broad group of allies including the G7, Five Eyes, the European Union, and NATO members, condemned Beijing for cyberattacks around the world, including a recent breach of Microsoft’s email systems, though the statement stopped short of issuing sanctions.
  • In light of these developments, the overall security pillar was weakened.

Trade (↔)

  • Meeting in Venice, finance ministers from the G20 signed off on a plan, already agreed to by some 130 nations, toset a global minimum tax rate of 15 percent of multinational corporations.
  • The Biden administration announced new rules that would require the value of a product’s component parts to be at least 75 percent manufactured in the US by 2029 to qualify for federal purchases under the Buy American Act, a move that raised concerns over rising US protectionism, though most US allies are exempt from the Act as parties to the World Trade Organization’s Government Procurement Agreement.
  • With the international tax plan moving forward, the global trade pillar was unchanged.

Commons ()

  • As discussed above, the Delta variant spread rapidly in the United States and Europe, as well as across much of the globe, undermining months of progress toward containing the pandemic.
  • China and Russia announced a pact to work together for new rules to control cyberspace, seeking to replace the existing internet governance structure, coordinated by the US-based ICANN non-profit group, with a system run by the International Telecommunications Union that could legitimize efforts to regulate and censor internet content.
  • China warned Britain’s Carrier Strike Group not to carry out any “improper acts” as it entered the contested South China Sea as part of a freedom of navigation operation.
  • With the revival of the coronavirus pandemic, the global commons pillar was weakened.

Alliances (↔)

  • The United States and India reaffirmed their commitment to deepening their security partnership, during a visit to New Delhi by U.S. Secretary of State of Tony Blinken. In an implicit reference to India’s recent democratic backsliding, Blinken also underscored the importance of democratic values, an issue he said he would approach “from a starting point of humility.”
  • US Defense Secretary Lloyd Austin and French defense minister Florence Parly signed an agreement to bolster US-French counterterrorism operations in Africa. As part of President Emmanuel Macron’s visit to Tokyo, France also pledged to “actively” collaborate with Japan amid European efforts to ramp up its presence in the Indo-Pacific in light of China’s growing influence.
  • As discussed above, the US-German agreement on Nord Stream 2 strengthened relations between the two allies, though others in Europe, including Poland and Ukraine, expressed criticism for the deal.
  • Most European allies declined to sign on to a statement led by the United States condemning Cuba’s recent crackdown against protestors, instead issuing a separate statement that called on Cuba to respect the rights of its people, but also noting that “the easing of external restrictions including on remittances and travel” (i.e. those imposed by the US), would be helpful in encouraging internal Cuban reforms.
  • On balance, the alliances pillar was unchanged.

Strengthened (↑)________Unchanged (↔)________Weakened ()

What is the democratic world order? Also known as the liberal order, the rules-based order, or simply the free world, the democratic world order encompasses the rules, norms, alliances, and institutions created and supported by leading democracies over the past seven decades to foster security, democracy, prosperity, and a healthy planet.

This month’s top reads

Three must-read commentaries on the democratic order     

  • Larry Diamond, in Foreign Affairs, contends that the failure of American democracy would be catastrophic not only for the United States; it would also have profound global consequences at a time when freedom and democracy are already under siege.
  • Alyssa Ayres, in Foreign Affairs, suggests that the health of India’s democracy is particularly important given India’s potential role as a democratic counterweight to the authoritarian challenge posed by Russia and China.
  • The Washington Post editorial board contends that Xi Jinping has made it clear that China under his dictatorial rule will present an escalating threat to the democratic world and to China’s neighbors.

Action and analysis by the Atlantic Council

Our experts weigh in on this month’s events

  • Matthew Kroenig, in a Wall Street Journal op-ed, contends that China is engaging in a massive nuclear-arms buildup as part of its broader strategy to challenge the rules-based international system, and the US will need to respond by updating its nuclear program.
  • Dan Fried and Ash Jain, in the New Atlanticist, suggest that to succeed in reviving the free world, the New Atlantic Charter will need broader support among democracies worldwide and concrete steps to turn its principles into action.
  • Jeffrey Cimmino, in an Atlantic Council Issue Brief, outlines an assertive strategy to counter China’s oppressive human rights violations in Xinjiang.
  • Gissou Nia, writing in the New Atlanticist, argues that the US needs better tools to fight transnational repression by autocratic regimes that are increasingly targeting journalists and opposition activists in exile.
  • Dan Fried and Jakub Wiśniewski suggest, in an Atlantic Council Issue Brief, that the US and Poland can expand their relationship based on common strategic approaches but need to reverse a drift apart on democratic values.
  • Tiff Roberts, in the New Atlanticist, contends that private enterprises in China are increasingly being forced to bend to Beijing’s diktats.
  • On July 15, the Scowcroft Center held a public event, The Renewal of Transatlantic Relations in an Era of Strategic Competition, in partnership with Global Affairs Canada, that featured a keynote conversation with Acting US Assistant Secretary of State for European and Eurasian Affairs Philip Reeker and panel discussions on how the United States, Europe, and Canada can advance shared priorities and revitalize the most powerful democratic community in modern history.

__________________________________________________

The Democratic Order Initiative is an Atlantic Council initiative aimed at reenergizing American global leadership and strengthening cooperation among the world’s democracies in support of a rules-based democratic order. Sign on to the Council’s Declaration of Principles for Freedom, Prosperity, and Peace by clicking here.

Ash Jain – Director for Democratic Order
Dan Fried – Distinguished Fellow
Jeffrey Cimmino – Assistant Director
Joel Kesselbrenner – Program Assistant
Paul Cormarie – Georgetown Student Researcher
Audrey Oien – Young Global Professionals Intern

If you would like to be added to our email list for future publications and events, or to learn more about the Democratic Order Initiative, please email AJain@atlanticcouncil.org.

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South Asia midyear pause: Taking stock of 2021 https://www.atlanticcouncil.org/blogs/new-atlanticist/south-asia-midyear-pause-taking-stock-of-2021/ Mon, 02 Aug 2021 19:56:08 +0000 https://www.atlanticcouncil.org/?p=418561 South Asia will face crucial issues like human security, regional stability, economic prosperity, and the pandemic in the remainder of 2021. How should we understand the region's prospects as we embark on the second half of the year? Our South Asia experts weigh in.

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Introduction

By Harris Samad

Though 2021 offers a glimmer of hope that the end of the COVID-19 pandemic is near, South Asia will contend with this wicked killer for far longer than the United States and its allies. In particular, given the region’s strained healthcare systems, geopolitical tensions, and economic slowdowns, it will likely experience the medium- and long-term ramifications of this unprecedented crisis for at least the next decade. Though we can and should be optimistic about the increasing availability of vaccines across South Asia, a parallel effect continues to take hold—particularly in the “big three” states (Bangladesh, India, and Pakistan)—as authoritarian figures and entrenched powers use the pandemic to justify heavy-handedness in suppressing media, free speech, religious diversity, and other pillars of democracy. Moreover, COVID-19 has exacerbated existing socioeconomic inequality across South Asia to the detriment of hundreds of millions of livelihoods. None of these issues are new, but the pandemic has made them far worse.

Intersecting with COVID-19, other crucial issues also confront South Asia in the remainder of 2021. How will the US withdrawal from Afghanistan impact human security, regional stability, and economic prosperity for that beleaguered nation? Will the Biden administration continue to treat Pakistan as a key ally? Can India really be the China counterweight that Washington desires? Will Bangladesh—until recently a leader of economic growth and vibrant democracy in the region—resist creeping authoritarianism? What about the existential threat of climate change that affects the whole of South Asia, but especially countries such as Nepal, in the foothills of the mighty Himalayas, or Sri Lanka and Maldives, a-sea in the vast Indian Ocean? As before, we do not presume to have the answers but hope our analyses provide a framework for understanding South Asia’s prospects in what remains of 2021.

Click here to read the South Asia Center’s 2021 road ahead analysis to explore the broader context of these issues.

Jump to a country:

Afghanistan

By Fahim Ahmad

The decision by US President Joe Biden’s administration and its NATO allies to withdraw all troops from Afghanistan by August 31, 2021, will test the young republic’s sustainability as the Kabul government is already struggling to fend off Taliban insurgents’ aggressive spring offensive with the objective to protect the budding democracy. Attacks on Afghanistan National Defense and Security Forces (ANDSF) and civilians have increased drastically—including targeted killings of minorities and children—making hopes for a durable peace grim and far from reachable. Many fear that gains made in the last twenty years, particularly regarding women’s rights, could be at risk. Afghanistan faces a multitude of challenges including improving the deteriorated security situation across the country, tackling the COVID-19 pandemic, and boosting a struggling economy heavily reliant on foreign aid.

Taliban insurgents do not seek peace: The peace negotiation in Doha between the Taliban insurgents and Afghan government is at a stalemate, with the Afghan side pressing the Taliban delegation to agree to a ceasefire. However, the Taliban group seems to be pursuing an all-out victory and is not adhering to the initial commitments of the Doha agreement with the United States, those being a reduction of violence and agreeing to a political settlement. The current situation reveals that the group is mainly exerting violence as a strategy to gain territorial and political control, which has ultimately led to the Doha deal and the US and NATO withdrawal. To reinvent itself and clean its public image, the group has appeared on international media, promised reforms, and claimed that they are no longer the Taliban of the 1990s; however, such promises are merely used as a manipulative tool to gain international legitimacy and media coverage, ease international sanctions, and gain the ability to travel freely. The somewhat moderate group of Taliban in Doha will continue to persuade the hardliners on the ground to continue their fight by promising that victory is within reach. Any peace negotiation starts with a short-to-long-term ceasefire that helps the process kick-start and run smoothly; however, the Taliban fears that agreeing to a ceasefire would slow the fighting machine on the ground and ultimately cost them the upper hand at the negotiation table. Current efforts will not result in long-term peace since they will merely result in a peace deal rather than a peace process. In reality, only the latter is sustainable.

Creating and supporting militia groups is a flawed policy: The Afghan government is recruiting local militias and supporting former ethnic warlords to fight against Taliban advancement, a move that represents a strategic blunder and only a short-term solution to its security-sector shortcomings. Historically, Afghanistan has not had a pleasant experience with ethnic militias having access to weapons, such as the mujahideen who commenced a bloody civil war after Soviet troops left Afghanistan; and history has shown that rebel groups with ethnic and political affiliations have been manipulated both by domestic and foreign actors for specific motives. The mujahideen, who have enjoyed enormous power in the last twenty years, have consistently undermined the central government when their demands have not been met. This has led to fundamental institutional reforms not taking place, including but not limited to transitional justice, anti-corruption and counter-narcotics efforts, and election reforms. The Kabul administration needs to enlist these “volunteer” military supplements with proper identification to ensure future accountability for their actions and avoid a repeat of history, namely human rights abuses along ethnic lines.

Continued support for Afghan democracy: To turn the page on four decades of war and avoid another military intervention, the United States and its NATO allies should continue to stand with the republic and the current government to preserve the gains made in the last twenty years. Grave risks will persist should Washington not make clear its intentions to support Kabul and back them up with robust assistance.

Grave risks will persist should Washington not make clear its intentions to support Kabul and back them up with robust assistance.

Top Pentagon leaders have warned that terrorist groups such as al-Qaeda may have the potential to regroup and use Afghanistan as a breeding ground to pose a threat to other countries—including the United States—as quickly as two years post-withdrawal. To prevent such a scenario, the ANDSF requires continued military and financial support from the United States and its NATO allies to stop the emergence of terrorist groups. As of January 2021, the total number of ANDSF personnel was at 307,000 and the US Congress has approved a little over $3 billion to support the forces for 2021, its lowest appropriation to fund the force since 2008  The ANDSF will undoubtedly rely on continued military aid beyond 2024, deeming security assistance crucial to prevent a full-scale civil war. Post-US withdrawal, the ANDSF will be responsible for all military operations. For it to be able to sustain itself and maintain security, there is a dire need for funding and modern military equipment. The United States and NATO should continue to train and equip the Afghan military, including by upgrading its underdeveloped air force. Moreover, the international community should use foreign aid as leverage to encourage anti-corruption and other reform efforts within the security sector.

Despite the delicate situation, the Biden administration—if it plays its cards right for the remainder of the year—can strengthen the military and political partnership with the Afghan government to achieve strategic goals including national security priorities and promoting and strengthening republicanism and democracy abroad.

Economic growth: The COVID-19 pandemic coupled with political unrest hit the Afghan economy hard in 2020, resulting in decreased trade and decreased revenue. The unemployment rate was reported to be 11.73 percent in 2020 compared with 10.98 percent in 2019; however, Afghanistan is expected to see an increase in gross domestic product (GDP) from 3 percent in 2021 to 4 percent in 2022. The question remains whether the country will be able to sustain and even exponentially increase growth. Afghanistan is a landlocked country that relies heavily on imports and has not diversified its products. With its current rate of growth and lack of diversification, the economy will not be able to generate revenue and ensure long-term economic sustainability.

Inflation is forecast to be 5 percent in 2021 and 4 percent in 2022, according to the Asian Development Bank, and a slight disruption or delay in imports can cause food prices to spike even further in the market, making it difficult for consumers to adjust to increased prices, and further pushing those vulnerable into poverty. The balance of trade is currently a negative value of more than $5 billion, resulting in reduced wages for domestic workers and an overall reduction in national savings. Import-oriented economies tend to face challenges including high inflation rates and reduced consumer buying power. Hence, the country should focus on diversifying its economy including by investing in human capital, which would result in a higher employment rate and a reduction in poverty. Moreover, corruption is a major issue impeding economic growth. Afghanistan should make an ample effort to tackle corruption as part of international best practices and strategies.

Bangladesh

By Ayra Khan

Fifty years after independence, Bangladesh has caught up to its South Asian neighbors in terms of economic indicators, such as per capita income and GDP growth, and social indicators. Challenges persist as it transitions from an agriculture-based economy to an industrial and service-oriented one. The COVID-19 global pandemic has exacerbated pressure on healthcare facilities and exposed social inequalities. Likewise, climate change must also be confronted, and Dhaka must navigate changing regional political dynamics adroitly to avoid setbacks.

Vaccines—diplomatic opportunity or a path toward conflict? Early in 2021, Bangladesh had begun to show signs of recovery from the COVID-19 pandemic with reduced restrictions and increased trade. However, as of June 2021, a second wave has led daily infections to reach new highs, with cases rising sharply.

In response to the continuously developing COVID-19 situation, obtaining vaccines is high on Bangladesh’s agenda. Though the country promised to purchase thirty million vaccine doses in a deal with the Serum Institute of India in November 2020 and received promises to get vaccines from other wealthy countries, the severity of India’s COVID-19 crisis and vaccine export ban, coupled with slow delivery and broken pledges, left Bangladesh unable to procure enough vaccines. As a result, Bangladesh has sought new suppliers to meet its demand, including China and the United States. Interestingly, these developments in vaccine acquisition occur behind a tense political backdrop for Bangladesh. China has recently begun to expand its scope in the region, with vaccines offering a unique opportunity to extend a helping hand. Similarly, China had expressed concern over the possibility of Bangladesh joining the Quad, a strategic partnership among the United States, Australia, India, and Japan. As Bangladesh’s economic outlook rises, its role as a strategic player is also emerging. Will vaccine diplomacy enable its ambitions by providing life-saving shots or thwart those ambitions by rendering the country a pawn sacrificed in great power politics?

Domestic shortcomings: What can Bangladesh do next? COVID-19’s political and social implications have extended beyond foreign relations. The pandemic raises troubling questions about the state of the health system and its ability to serve underprivileged groups. Healthcare is a significantly underfunded sector, with only “5.14 percent of the total [fiscal year 2021] budget,” or “less than 1 percent of GDP,” allocated to it. The ongoing pandemic has exposed the need for crisis relief measures, adequate healthcare, and inclusive health support, which together require far greater outlays of expenditure.

The pandemic has also provided a revealing glimpse into the mechanisms of Bangladeshi institutions. In response to concerns raised about “disparities in healthcare access,” the government “silenced healthcare workers,” and government employees. Such actions add to concerns raised by organizations such as Human Rights Watch about growing censorship enabled by new laws such as the Digital Security Act of Bangladesh. However, in spite of the devastation caused by COVID-19 and a return to a stringent lockdown, there are reasons for optimism for Bangladesh’s future. Though Bangladesh has fully vaccinated less than 3 percent of its population, it has approved seven vaccines and resumed mass vaccination in July. Bangladesh has also created a new digital platform to coordinate and enable vaccine access. Before the second wave of coronavirus, there had been a positive rebound within various industries. With the rising availability of vaccines, hope for a return to normalcy grows. But as is true worldwide, there is also the realization that the previous normal did not work for all. For marginalized groups who were and continue to be disproportionately affected by the pandemic, such as women, particularly those employed by export-based industries, or refugees in Cox’s Bazar, the recovery has been riddled with inequality. For example, income distribution remains more unequal for low-income families, and women continue to lag in reaching pre-COVID employment levels. Overall, new policies and efforts must be inclusive of underprivileged groups to create meaningful and long-lasting recovery.

The [pre-pandemic] normal did not work for all… . New policies and efforts must be inclusive of underprivileged groups to create meaningful and long-lasting recovery.

Climate change: What is next? Bangladesh ranks sixth on the Global Climate Risk Index and continues to be among the most vulnerable countries to climate change due to its physical topography and social factors, including poverty and population density. Cyclone Yaas, which caused intense damage to the area, is the most recent in a long list of climate-related disasters to afflict the country. While Bangladesh’s crisis response to climate-related incidents has improved over the years, much remains to be done to support “resilient coastal communities.” Aside from more technical efforts such as shelters and disaster management programs, Bangladesh must redesign its climate response to prepare for long-term change. Bangladesh is a member of various global initiatives, including Partnering for Green Growth and the Global Goals 2030 (P4G) and the Leaders’ Summit on Climate, the latter convened by the United States in the spring of 2021. However, beyond such programs, Bangladesh must take concrete steps to contribute to global sustainability measures. These steps can include reducing its carbon footprint by decreasing the production of fast fashion. Moving away from such practices would help mitigate long-term ecological damage and reduce the threatening work conditions in this industry. Likewise, the scope for a blue, resilient economy is ever-present and becoming more evident. By supporting efforts to reduce the impacts of climate change and encourage sustainability, Bangladesh can support its growing economy as well as marginalized groups that are more vulnerable to climate shocks including the Rohingya refugees, who are disproportionately affected by monsoon-related disasters and the shortage of facilities, and women.

Bhutan

By Emily Carll

To date, just two people have died of COVID-19 in Bhutan. That said, the fact that Bhutan sits in between two countries that have suffered major COVID-19 outbreaks illustrates a highly delicate situation. Moreover, its reliance on regional hegemons to secure access to vaccines has put it in a precarious position. The struggles and effects of COVID-19 are far from over in Bhutan. Meanwhile, establishing itself on the international stage and furthering global partnerships will be a challenging yet critical opportunity. With continued restrictions and isolation due to the pandemic, Bhutan will need to be creative in its diplomacy but use its newfound inclusion and leadership roles to be a driving voice on key issues such as climate change. Going into 2022 Bhutan may also be forced to end its strategic silence to manage Chinese expansionism depending on the progress of talks between the countries to settle border disputes. Finally, it will be important to see how Bhutan will navigate its climate vulnerability after learning lessons from the COVID-19 pandemic.

Managing COVID-19: Going forward in 2021, Bhutan will be at the whims of geopolitical giants for fair vaccine distribution. As studies continue to lower the eligible vaccination age bracket, and the Delta variant continues to permeate its southern border, Bhutan will need vaccines for younger individuals. India’s Vaccine Maitri initiative remains suspended with no resumption in sight due to the continued crisis there, while Bhutan barely avoided a situation that could have led to the collapse of its healthcare system. After obtaining second-dose vaccines from Denmark—with only two weeks remaining before the efficacy of the vaccine expired for the more than 93 percent of Bhutan’s eligible adults who had already gotten their first shots—Bhutan will have to ensure that it has reliable partners going forward.

Bhutan will need to be creative in its diplomacy but use its newfound inclusion and leadership roles to be a driving voice on key issues such as climate change

Growing international presence: Now included in platforms such as the P4G Summit and holding the presidency of the seventy-fourth World Health Assembly, Bhutan has the opportunity to raise awareness of issues that disproportionately impact smaller countries. Bhutan can seriously engage multilateral and bilateral fora on climate change discussions and solutions and should consider doing so before it is too late. In the first half of 2021, Bhutan used its international contacts to address this issue, signing a memorandum of understanding for cooperation on climate change and waste management with India and participating in the P4G Summit where world leaders addressed climate change and progress toward the 2030 Sustainable Development Goals. Seeking to increase its international presence and build partnerships with countries in the region despite the pandemic, Bhutan will need to emerge from isolation and further engage the greater region and world. In June, Bhutan’s National Assembly adopted a preferential trade agreement between Bhutan and Bangladesh, a necessary step to begin integrating its economy into the region. Yet to successfully engage the greater region and world, Bhutan could use both its vaccination needs and the potential of the remote-work world to engage in creative diplomacy and forge partnerships with countries it may not otherwise engage.

Managing Chinese expansionism: While Thimphu has avoided aggravating its larger neighbor—particularly when Bhutan needed Chinese aid to control the pandemic—the country can maintain its strategic silence for only so long before current tensions come to a head. China is slowly pushing boundaries and limits along the China-Bhutan border, which it claims were never delineated. In April, China and Bhutan agreed to resume talks to come to a peace agreement, but China has allegedly taken things into its own hands and has started building infrastructure and buildings in rural Bhutan, a land-grabbing strategy similar to what it is doing in the South China Sea. While there has not yet been a direct conflict and exchange of gunfire, such as has happened in the China-India border conflict, the China-Bhutan border dispute is worth keeping an eye on.

Addressing climate change post-pandemic: Coming out of the pandemic, Bhutan is more vulnerable than ever to climate change. If the international community reverts to the normal actionless talks on climate change, Bhutan stands to be devastated by its effects. Its economy is reliant on climate-sensitive sectors including hydropower, agriculture, and environmental tourism, necessitating the need for climate resilience. Bhutan must invest in climate resilience and collaborate with regional partners on education and training surrounding natural disaster response while continuing to advocate in forums such as the P4G, the United Nations Climate Change Conference of the Parties, and others about the impacts of climate change and how to build climate resilience. Bhutan disproportionately feels the effects of climate change as landslides and flash floods have become a common occurrence, especially due to glacial melting and glacial lake outburst floods. It will be important to see if Bhutan and the international community will translate lessons learned about the importance of preparedness and resilience from the COVID-19 pandemic to mitigate climate vulnerability.

India

By Capucine Querenet

For India’s massive 1.3 billion population, 2021 offers no respite from COVID-19. With over thirty-one million confirmed cases, overwhelmed health infrastructures, and a crumbling democracy, the country once considered an economic powerhouse positioned to overtake China is faltering with yet more formidable challenges ahead. Post-pandemic reconstruction will require a concerted and collective effort by domestic and international actors to restore India’s vibrant economy, while public tensions over the government’s mishandling of a second coronavirus wave test the country’s political landscape.

A humanitarian crisis: The Bharatiya Janata Party (BJP)’s February 2021 declaration of victory in the fight against COVID-19 was premature. Loosened restrictions and public complacency, coupled with a slow government response to highly contagious variants, catalyzed a horrific second wave as infections soared to record the highest single-day figure globally. At the peak of the second wave, India was reporting an average of four hundred thousand cases per day, though evidence of underreporting suggests a much higher case count and death toll than even these gaudy numbers suggest. Overtaxed hospitals, still reeling from the first wave, were brought to their knees by the second wave and even today are forced to turn away patients, some of whom have desperately resorted to the black market, while those lucky enough to secure a bed scramble to find oxygen tanks and COVID-19 medications. Families vie for space at cremation grounds, even erupting into physical fights as emotions run high. Though official numbers as of mid-June show signs of easing—Delhi in fact lifted restrictions on manufacturing and construction in late May—the virus remains active and the government’s slow vaccination drive leaves room for variants to develop. Countering a third wave requires swift government action; however, many argue the latter has yet to materialize.

Critics of Prime Minister Narendra Modi’s response largely cite his dismissal of expert warnings and blatant disregard of reality in favor of misleading optimism. As hospitals and crematoriums struggled to keep pace, critics argue that the prime minister showed greater concern for the future of his political fortunes than the health of the Indian population by allowing maskless religious and political gatherings and avoiding announcing the restrictions required to stem the rampaging virus. Such decisions worsened the crisis, which is predicted to knock off 2.8 percentage points from GDP growth in fiscal year 2022 and has pushed news outlets to become increasingly critical of current leadership. While vaccines offer a path forward, shortages, complicated policies, misinformation, and vaccine hesitancy have undermined the government’s vaccination drive with only 7.2 percent of the population fully immunized. Though the government launched a new policy offering free vaccinations to eligible adults, the social and economic impacts of COVID-19 are significant and require a reimagined government response to facilitate post-pandemic reconstruction.

The social and economic impacts of COVID-19 are significant [in India] and require a reimagined government response to facilitate post-pandemic reconstruction.

An erosion of democracy: Separate reports published in May 2021 by Freedom House and the Varieties of Democracy (V-Dem) measuring the state of democracy downgraded India in rankings to a “flawed democracy.” V-Dem even labeled India an “electoral autocracy,” citing increased pressures on human rights groups, curbs on media freedoms, and attacks on Muslims as the primary indicators of eroded political and civil liberties in the country.

Censorship efforts by the national government and its state allies are increasingly routine with laws on sedition, defamation, and counterterrorism used widely to silence critics. In early 2021, a farmer protest in Delhi led to dozens of police complaints against farm leaders, journalist arrests, suspensions of Twitter accounts, and loss of electricity, water, and internet. Later, in April, about one hundred Facebook, Instagram, and Twitter posts criticizing Modi’s COVID-19 response were removed at the BJP’s request. Just last year, sixty-seven journalists were arrested, detained, and/or questioned for their work. Siding with the government offers protection and business, while critics face court battles, blackouts, jail, and more. The government’s legislative and regulatory actions against media and civil liberties will have a lasting impact on India’s democratic credentials for years to come.

Maldives

By Ayra Khan

In June, Maldivian Foreign Minister Abdulla Shahid was elected president of the United Nations (UN) General Assembly, outperforming his Afghan rival and capping a relatively successful first half of 2021 through which the island nation maintained its reputation as a must-travel destination in spite of the pandemic.

Maldives fights to remain a top travel location, despite the global pandemic: Maldives’ tourism-oriented economy took a severe blow in 2020, losing almost 67.4 percent of its tourists in early 2020, creating a vacuum in growth resulting from a loss of jobs and foreign exchange receipts. In July 2020, however, Maldives saw a resurgence, with tourist numbers surpassing predicted levels. These prospects continued well into 2021, an unexpected success credited to various factors, including its unique geographical advantages, well-adapted tourism infrastructure, and strict health requirements. Creative efforts, such as the 3V program, aimed to attract tourists looking to “visit, vaccinate, [and] vacation,” were also introduced in early 2021. However, despite its successes, Maldives has been placed in a difficult position as neighboring countries such as India have seen a surge in coronavirus infections. As a result, Maldives was forced to suspend tourism from South Asian countries, which is worrisome since this sector contributes to over 28 percent of the nation’s GDP. However, Maldives’ COVID–related outlook remains positive with continuously falling case numbers and a steady rate of vaccination (Maldives has enough doses to vaccinate around 54 percent of its population). A reopening of borders seems possible as early as July 2021, with restrictions already being reduced.

As climate concerns rise, does Maldives have the chance to shine? Climate change poses an existential challenge for Maldives. Raised by various leaders at multiple platforms, Maldives’ stance on sustainability remains positive and firm. Shahid has promised to encourage green, sustainable growth and also tackle the issue of climate change. This is of growing concern as rising sea levels, in particular, place Maldives in a highly vulnerable position. To respond to the looming threat, in collaboration with the Asian Development Bank, Maldives has established a comprehensive road map for its energy sector for 2020-2030. This plan underscores the critical role renewable energy investment has played and will continue to play in sustaining long-term growth in the country. In particular, solar, wind, tidal, and biomass energy sources remain unexplored and undercultivated, offering Maldives a unique opportunity to showcase climate-oriented innovation. Likewise, Maldives has a novel opportunity to lead the world in becoming a “blue economy.” Overall, climate change efforts offer a unique chance for Maldives to play a leadership role in enabling global collaboration with the help of investors, knowledge sharing, and interest from various stakeholders.

Climate change efforts offer a unique chance for Maldives to play a leadership role in enabling global collaboration with the help of investors, knowledge sharing, and interest from various stakeholders.

Political uncertainty and the pursuit of justice: Maldives is a young and learning democracy, having chosen its first freely elected president only in 2008. While over a decade has passed, the reality remains that Maldives is still discovering its path to creating a free, just, and democratic nation. This year has thus far been concerning amid recent political unravelings, including the attack in May on former President Mohamed Nasheed, attributed to religious extremism and political differences. Furthermore, Maldives scores relatively low on political freedom, scoring only 40 out of 100 points on Freedom House’s rankings in 2021. Areas for improvement include stronger measures against corruption and improved civil liberties, including freedom of the press and freedom of religion. A bright spot is Maldives’ introduction of the Transitional Justice Act and institution of the Office of Ombudsperson for Transitional Justice. The act is described as aiming to “[sanction] investigations into past wrongdoings by state authorities, heads of agencies, or individuals in power, which resulted in human rights violations.” While this is a step in the right direction, critics point out the disconnect between the intended and actual outcomes of the bill. In particular, they raise questions regarding the adequate enforcement of the bill, the ability to ensure accountability despite massive power imbalances, and the proper protection of the privacy and safety of victims. Will this bill serve the people who have suffered, or will it only act on a performative level? The answer will set the tone for the future of Maldives’ fabric as a nation and its relationships with its citizens.

Nepal

By Harris Samad, Capucine Querenet, and Areeba Atique

This year offers Nepal little reassurance as the country dives headfirst into a severe political and healthcare crisis catalyzed by a second coronavirus wave. Unprepared leadership has left overwhelmed hospitals to fend for themselves as medical supplies, beds, and healthcare workers run scarce, while pandemic-related disruptions disproportionately affect the poor and threaten to push more below the national poverty line. Women’s safety, too, remains at stake with new legislative frameworks that offer more harm than help and highlight the country’s recession of human rights. Overall, Nepal paints a bleak picture for the remainder of 2021 on intersectional issues related to corruption, coercion, and its COVID-19 pandemic response.

A healthcare catastrophe: Like much of South Asia, Nepal’s already under-resourced public health system has been further debilitated by COVID-19. With fewer than two thousand intensive care unit beds and six hundred ventilators for a population of thirty million, a humanitarian crisis is unfolding with far-ranging political and economic repercussions mirroring those of Nepal’s 2015 post-disaster recovery. To date, institutional incompetence and dysfunctional governance have sidelined marginalized communities while medical supply shortages exacerbate death tolls. Though medical supplies from China recently arrived, extra resources will prove futile without adequate government response or a strong vaccination campaign, both of which seem unlikely.

In late February, Minister for Health and Population Hridayesh Tripathi expressed optimism about receiving Oxford-AstraZeneca vaccines from the Serum Institute of India, though this promise was short-lived. A spat between the Nepali government and Hukam Distribution and Logistics Private Limited—the agency in charge of supplying vaccines—leaves only 2.5 percent of the population fully immunized and threatens a third wave worse than India’s second surge. Mitigating this requires states to work collaboratively in supporting global mechanisms such as COVAX, yet whether such a policy materializes is uncertain and will be a crucial area to watch moving forward in Nepal.

Gender-based rampage: Recent legislation depriving women of self-determination and freedom garnered significant backlash for its skewed and myopic priorities that highlight leadership’s paternalistic views. Under the amendment, women under the age of forty must obtain approval from families and local wards to travel abroad and cannot seek employment outside the country. Though this is said to be intended to mitigate human trafficking and violence toward women and girls, it is a distinct example of victim-blaming and discriminatory legislation. The proposal objectifies women—first, by denying their autonomy in lieu of empowerment and capacity-building efforts; second, by doing so without female decision-making authority; and third, by regulating women rather than associated agencies and institutions.

Given that vulnerable populations have systematically been sidelined throughout the pandemic, repealing the current proposal and implementing smarter strategies is imperative to ensure women’s and girls’ safety. The Nepali government should work collectively with other nations to enact protection programs and should better regulate recruitment agencies to prevent gender-based abuses. Critically, however, many more women are needed at the decision-making level.

Unnecessary political maneuvers from both the formerly ruling Nepal Communist Party and its opposition overshadowed efforts necessary to combat COVID-19 and projected a long, tedious road to recovery.

Political turmoil after Parliament’s disbandment: Tandem to Nepal’s health and human rights crises, its troublesome political landscape does not inspire confidence; however, fresh leadership may open a new chapter. Former Prime Minister K.P. Sharma Oli’s assaults on the country’s constitution and democratic endeavors led to his demise when the Supreme Court ousted Oli in mid-July to instate President of the Nepali Congress Sher Bahadur Deuba for an eighteen-month position—his fifth stint in leadership. Though Deuba’s appointment is a welcome change for many, fissures are already emerging and the new prime minister’s history of ill governance practices may indicate future failure to end Nepal’s political chaos. As the country grapples with COVID-19 repercussions, notably a faltering economy and a public-health crisis, decisive and efficient leadership tending to the population’s needs rather than those of political parties is critical. But thus far, unnecessary political maneuvers from both the formerly ruling Nepal Communist Party and its opposition overshadowed efforts necessary to combat COVID-19 and projected a long, tedious road to recovery. Whether Deuba will navigate the current crisis appropriately and smartly remains to be seen; however, continued political infighting and inefficient governance bode ill for the country’s future.

Pakistan

By Kaveri Sarkar

This year presents a multitude of challenges for cash-strapped Pakistan. The economy remains in trouble, domestic political instability continues, vaccination centers face shortages, the situation in neighboring Afghanistan crumbles further, and Islamabad’s geoeconomic ambitions remain far from being realized. The remainder of 2021 will require Pakistan to concentrate its efforts to tackle the ongoing third and a possible fourth wave of the pandemic, articulate a cohesive economic strategy, and engage its neighbors responsibly.

The US military withdrawal from Afghanistan puts the spotlight on Pakistan: With Pakistan descending lower on Washington’s priority list in 2021, the US withdrawal from Afghanistan further threatens to unmoor Pakistan’s relevance to the United States. The imminent military withdrawal also brings Pakistan’s approach to Afghanistan into the limelight on the international stage. A regional consensus for Afghan peace is imperative yet currently lacking, and Pakistan stands to lose in many ways if the Taliban regains power. While the Pakistani leadership has pledged its support for and commitment to the intra-Afghan peace negotiations—powered by Prime Minister Imran Khan’s visit to Kabul last November—Islamabad will need to substantiate this rhetorical commitment with meaningful action. In 2021, it is in Pakistan’s national interests to leverage its long-standing ties with the Taliban to help negotiate a peace deal, along with weeding out Taliban strongholds within its own borders. If it does not, it stands to suffer from an influx of Afghan refugees, increased Taliban influence on militants housed within its own borders, and the evaporation of its economic and regional connectivity goals. Unfortunately for Pakistan’s international image, the recent abduction of the Afghan Ambassador’s daughter in Islamabad followed by Pakistan’s denial of the incident has led both countries to retract their diplomats—thereby exposing cracks in the already tense Pakistan-Afghanistan relationship—and conjured a diplomatic disaster for Islamabad. While marring the country’s dismal reputation regarding internal security, this abduction and the murder of a former Pakistani diplomat’s daughter also raise questions on the safety of women and gender-based violence more broadly.

Geoeconomic ambitions or delusions? In 2021, Foreign Minister Shah Mahmood Qureshi and Chief of Army Staff General Qamar Javed Bajwa elucidated Pakistan’s aim to move from a geopolitical state to a geoeconomic one, a goal central to the country’s 2025 vision. This shift in goals is positive, but there are mounting concerns about Islamabad’s ability to realize these geoeconomic ambitions. 

Pakistan’s debt to China now amounts to $24.7 billion, a phenomenon that Western analysts brand “debt-trap diplomacy.” Pakistan has cited waning US interest in Pakistan as having catalyzed Chinese involvement and deepened a seventy-year bilateral friendship; however, several factors deter foreign investment from the United States and other nations to Pakistan. Though it boasts more open foreign direct investment laws, the country’s Financial Action Task Force Grey List rating; incoherent governmental policies such as the TikTok ban, which was issued late last year and later rescinded; and a confused economic policy are unattractive, especially for e-commerce businesses. The recent addition to Amazon’s seller list, however, is a welcome update as it will likely lead to an increase in employment and exports, and make gracious use of the startup ecosystem in Pakistan.

On the other hand, the economic conversation taking place in the country remains limited to gas and power subsidies, lacks creativity and investment in research and development, and struggles to compete with the manufacturing sectors of other developing countries, all while textile and agricultural patronages dominate and inflation cripples the less privileged sectors of society. Adding to these woes, environmental sustainability continues to be the missing piece in Pakistan’s geoeconomic puzzle. Taking stock of the environmental ramifications of the China-Pakistan Economic Corridor project and hazards like air pollution and extreme heat should be an indispensable component of the leadership’s focus.

Pakistan has struggled to preserve old economic partners and runs into a brick wall when considering new ones. Last August saw tensions sprout when Qureshi, in an audacious move, challenged Islamabad’s support for Riyadh if Saudi Arabia did not take a firm stand on Kashmir. This resulted in Saudi Arabia—which has moved away from an Islamic foreign policy to one guided by economic interests—canceling a $3 billion loan to Pakistan. Khan’s May 2021 visit to Riyadh—undertaken in hopes of resuscitating Pakistan’s strained relations with its erstwhile economic patron—along with the repayment of a $1 billion loan made possible through Chinese assistance–seems to have done some much-needed damage control, for now.

Closer to home, Pakistan, in a moment of clarity, reconsidered lifting the ban on importing two commodities—sugar and cotton—from India in April of this year. Such a move would have broadened Pakistan’s trading options, reduced prices, and further integrated Pakistan economically in the region, and yet the opportunity was sacrificed to its preoccupation with Kashmir. Prime Minister Khan punctured speculations of a “thaw” in India-Pakistan relations by remarking that trade relations would not come at the expense of Kashmir. To truly realize its geoeconomic potential, Pakistan must de-link its economic outlook from its geopolitical and security whims, and protest issues of geopolitical significance in a way that does not hurt its economic prospects and further feed its aid dependency. To Pakistan’s credit, the ceasefire announced in February by India and Pakistan after decades of border skirmishes is a step in the right direction, especially as the ceasefire remains unviolated since then.

Domestic turmoil bubbles to the surface and threatens all else: Before Pakistan has a chance to flex its potential diplomatic muscles or set its geoeconomic aspirations in motion, Islamabad must contend with ongoing political and social issues—women’s rights, elitism, crackdowns on media freedom, political instability, religious extremism—that undermine its progress. Most recently, the torture of a vlogger—who had criticized the government and military—added another black mark to Pakistan’s poor reputation regarding threats to journalism and media freedom. Meanwhile, 2021 has also been privy to the ban of the extremist outfit Tehreek-e-Labbaik Pakistan following violent protests; a brawl that broke out in the National Assembly; and the opprobrium inflicted upon the 2021 women’s march, not to mention the prime minister’s problematic comments on women’s clothing choices that left many appalled.

Before Pakistan has a chance to flex its potential diplomatic muscles or set its geoeconomic aspirations in motion, Islamabad must contend with ongoing political and social issues… that undermine its progress.

All of the above, coupled with the persistent political opposition faced by the Pakistan Tehreek-e-Insaf government, cast doubt on Pakistan’s capacity to tackle the economic depredations of the pandemic and societal tumults in a competent way. If the recent privatization of vaccines—which would deepen existing socioeconomic fissures—is any indication, domestic strife is likely to subsist throughout the year.

Sri Lanka

By Emily Carll

Halfway through 2021, Sri Lanka’s democratic backsliding shows no signs of abating, and restrictions on religious freedom and human rights continue to grow. Not only is the government emboldened by the lack of any meaningful attention to its abuses from international actors—most of whom are distracted by COVID-19—but the pandemic has increased the country’s reliance on foreign borrowing, tipping the fragile balance of Sri Lanka’s dependence on China. Looking ahead, economic and environmental recovery will be both a difficult and slow process.

Democratic backsliding in human rights, political freedom, and accountability: Throughout 2021, Prime Minister Mahinda Rajapaksa’s government has continued to use the pandemic and national security to justify its human rights abuses and increase restrictions on religious freedom with no signs of slowing down. In February, forced cremations of Muslims who had died due to COVID-19 were deemed a matter of “public safety” as the government argued that burials of COVID-19 victims would contaminate the groundwater. This ceased after Sri Lanka was met with international criticism, particularly from Pakistan. The government’s alternative solution, however, was to bury the dead on a remote island in the Gulf of Mannar, around three hundred kilometers from Colombo. In a further move to restrict religious freedom, the already problematic Prevention of Terrorism Act (PTA)—which disproportionately imprisons Muslims and Tamils—was strengthened in March when the Rajapaksa government introduced a burqa ban, arguing it necessary as a matter of “national security.” In the latest erosion of Sri Lanka’s “democracy,” President Gotabaya Rajapaksa pardoned political ally Duminda Silva, who was convicted and sentenced to death for the murder of a political rival and three of his supporters. The lack of accountability for human rights abuses in Sri Lanka allows a convicted murderer to walk free while many remain imprisoned on false and baseless charges under the PTA. These developments indicate that such regressive policies are only accelerating to the detriment of Sri Lanka’s struggling democracy and should be closely monitored for the remainder of 2021.

Regressive policies are only accelerating to the detriment of Sri Lanka’s struggling democracy and should be closely monitored for the remainder of 2021.

A glimmer of hope: If the European Parliament is true to its word and demands actual accountability from Sri Lanka by leveraging their bilateral trade relationship, the Rajapaksa government may be forced to tamp down its human rights crackdowns, even if reforming only the most blatant offenses. International pressure began to mount against Sri Lanka in March of this year, when twenty-two countries in the United Nations Human Rights Council voted to pass a resolution against Sri Lanka. According to Human Rights Watch, they established “a powerful new accountability process to collect, analyze, and preserve evidence of international crimes committed in Sri Lanka for use in future prosecutions.” Since the resolution in March, the European Parliament also issued a statement in June warning the Rajapaksa government that its worsening human rights record will jeopardize its bilateral and trade relations with the European Union (EU).

The EU is Sri Lanka’s second-largest trading partner and second-largest export destination. To appease the EU, the Rajapaksa government released sixteen individuals imprisoned under the PTA. The statement from the EU also triggered a response from Sri Lankan Justice Minister Ali Sabry, who said, “The PTA will be either revised or repealed depending on a report by two committees appointed by the Cabinet.” This is the longest the international spotlight has been on Sri Lanka and its human rights abuses. As such, while a vote against Sri Lanka by the United Nations Security Council would never pass due to China’s and Russia’s veto power, this is a step in the right direction.

Debt burden and foreign policy: The balancing act: Unless India and the other Quad members provide assistance to Sri Lanka to counterbalance its dependence on Beijing, China will likely have an uncontested hand in influencing Sri Lanka’s foreign policy as it recovers from the pandemic. With India failing to deliver on its vaccine promises, Sri Lanka accepted help from China in the form of vaccines, financial assistance, oxygen, personal protective equipment, and more. In addition, Sri Lanka inaugurated the China-Sri Lanka Association for Trade and Economic Cooperation, creating a platform for increased Chinese economic influence in the region. Most recently, Sri Lanka showed its loyalties as it issued a golden coin as “an accolade for long-standing friendship and mutual trust” between the two countries.

This and increased Chinese engagement in Sri Lanka have certainly unnerved India and the other Quad powers. Increased Chinese engagement will also lead to the prioritization of Chinese interests at the expense of Sri Lanka’s. With a default risk of 27.9 percent—the highest in the Asia-Pacific—Sri Lanka may be walking into another Hambantota Port situation.

Recovery from the pandemic and an environmental disaster: Sri Lanka will spend the rest of 2021 attempting to recover from both the COVID-19 pandemic and concurrent crises. Specifically, managing its increasing debt will be one of the crucial pillars of Sri Lanka’s economic recovery. Sri Lanka’s high default risk also makes it likely that the country will go further into debt to repay its existing debts, potentially needing to turn to the International Monetary Fund for financial assistance.

To complicate recovery efforts, a recent fire on the MV X-Press Pearl cargo ship off the coast of Sri Lanka devastated beaches and fisheries with toxic chemicals, plastics, and waste. This unprecedented disaster in Sri Lanka will slow economic recovery due to the country’s reliance on the environment for food and tourism while adding environmental recovery to Sri Lanka’s growing list of priorities for 2021. Scientists predict that this incident will likely lead to years of ecological damage to Sri Lanka and its surrounding environment. With fishermen now out of jobs and people hesitant to eat seafood, immediate recovery efforts will be necessary to restimulate the economy. Finally, if not for the environment itself, tourism will be a driver of the environmental relief efforts as Sri Lanka’s third-largest foreign exchange earner. The country will be targeting efforts to curb the impacts of the disaster in hopes of setting tourism back on track and stimulating its economy.

The South Asia Center serves as the Atlantic Council’s focal point for work on greater South Asia as well as its relations between these countries, the neighboring regions, Europe, and the United States.

The authors

Fahim Ahmad is a project assistant at the Atlantic Council’s South Asia Center.

Areeba Atique is a young global professional with the Atlantic Council’s South Asia Center and a fellow with the American Pakistan Foundation.

Emily Carll is a project assistant at the Atlantic Council’s South Asia Center.

Ayra Khan is a research assistant at the Atlantic Council’s South Asia Center.

Capucine Querenet is a project assistant at the Atlantic Council’s South Asia Center.

Harris Samad is assistant director of the Atlantic Council’s South Asia Center.

Kaveri Sarkar was a project assistant at the Atlantic Council’s South Asia Center.

All photos courtesy of Reuters.

More from the South Asia Center

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The post-COVID world this week: We’re not in the clear yet, so here’s what to read while you wait https://www.atlanticcouncil.org/blogs/coronavirus-alert/the-post-covid-world-this-week-were-not-in-the-clear-yet-so-heres-what-to-read-while-you-wait/ Sat, 31 Jul 2021 15:52:08 +0000 https://www.atlanticcouncil.org/?p=419884 What can we expect from a post-COVID world after a pandemic that has reshaped international affairs? A world in which there are plenty of bookworms.

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The future is here: A guide to the post-COVID world 07/31/2021

In place of the usual analysis, here are some summer reading suggestions for the beach, mountains, or backyard. In keeping with the theme of this newsletter, some are thoughts about the future—scenarios, predictions, utopias, and dystopias. We think of the future in many ways: Some are big ideas about the world, some are about the nature of our world today and how we got here, and some are inspirations.

The suggestions are based on recommendations submitted by our highly literate and deeply thoughtful staff at the Atlantic Council. The links are to the site Bookstore.org, which offers you the possibility to support local bookstores in the United States or the United Kingdom by shopping online. Many will be also available in bookstores internationally.

In case this list still leaves you seeking ideas, I will be posting more book recommendations on the Atlantic Council website next week. The newsletter will resume as normal on Saturday, September 11.

BIG IDEAS: Fuel for the mind.

Antifragile by Nassim Nicholas Taleb. I am fascinated by any discussion about how our world endures when faced with disorder and challenges, particularly systems that actually gain from disorder. (Arun Iyer)

Anthro-Vision by Gillian Tett. This is such a cool book. Written by an anthropologist who started her career doing fieldwork in Central Asia—and who later became a journalist with the Financial Times—it will help you see the world in very new ways. (Jennifer Brick Murtazashvili)

Extremism by J.M. Berger. A really great, easy read on what drives people to adopt (and act on) beliefs, whether religious, political, or otherwise, that the mainstream would view as extremist. (Jennifer Counter)

Factfulness by Hans Rosling. This book is full of interesting facts that contradict our view of the world and allow us to see things more clearly. (Amjad Ahmad)

The Delusions of Crowds: Why People Go Mad in Groups by William J. Bernstein. Read this book to understand the craziness of our present predicament. A psychological assessment of end-times delusions from misinterpreted Biblical prophecies to financial contagions and their similarities. (Robert Manning)

Think Again by Adam Grant. A book for everyone! “Discover the critical art of rethinking: how questioning your opinions can position you for excellence at work and wisdom in life.” (Defne Arslan)

First Principles: What America’s Founders Learned from the Greeks and Romans and How That Shaped Our Country by Thomas Ricks. The January 6 Capitol riot was eerily similar to the conspiracy that foreshadowed the fall of Rome. It compelled us to understand the Greek and Roman principles that influenced the founders of the United States, as well as how renewing them can help us find our way through dark times. (The Cyber Statecraft Initiative team)

The World America Made by Robert Kagan. This slim volume can be read in a single day at the beach—and it reportedly had a major effect on then US President Barack Obama’s thinking when it was first published in 2012. Kagan’s historical analysis and insights are as timely as ever. On balance, US global engagement has been a force for good in international affairs over the past seventy-five years. Washington must continue to lead on the world stage or else other hostile actors, such as Russia and China, will fill the power vacuum—with potentially disastrous consequences. (Matthew Kroenig)

Braiding Sweetgrass by Robin Wall Kimmerer. I recommend this one in audiobook form. Narrated by the author, whose voice is super soothing, it brings a different perspective to our relationship with nature and other human beings. (Adriana Lacerda)

THE FUTURE IS HERE: What happens next? Imagination and forecasts.

Project Hail Mary by Andy Weir. I loved this book because it envisions a future that changes our conception of what it means to be a human on Earth; because of its innate optimism about the power of science; and because it was just an awesome, breezy, and extremely interesting and enthralling read. (Barry Pavel) As I wait for seats on Blue Origin, SpaceX, and Virgin Galactic rocket ships to be available for the masses, I read this (and everything else by Weir) because his science is mostly solid and his characters make me laugh. (Stefanie H. Ali)

Leave the World Behind by Rumaan Alam. A family goes on a Hamptons vacation. One day, the rented house’s owners knock on the door and say there’s been a disaster in Manhattan and that they have to hunker down together. This promises to be a window into how people survive in lockdowns and cling to ideas of normalcy—sound familiar? (Katherine Walla)

Novacene: The Coming Age of Hyperintelligence by James Lovelock with Bryan Appleyard. Sweeping and far-seeing, I loved this book by the brilliant James Lovelock because it posits the end of the current Anthropocene era in which humans are the dominant actors on earth and suggests that the next era will be dominated by artificial intelligence… which will save the planet. (Barry Pavel)

Pet by Akwaeke Emezi. I truly believe Emezi is one of the most revolutionary writers of this decade: through Pet, they imagine a world in which trans kids are given the care and respect they deserve, structural change has been made, and justice leads to true reconciliation. It reminds readers that if we don’t take time to remember, teach new generations, and make the consistent choice to be better, we won’t be able to keep moving forward. (Alyssa Harvie)

Severance by Ling Ma. A young woman navigates a nearly apocalyptic world post-pandemic. Hilarious but also terrifying. It was an A+ read last summer, when COVID-19 seemed like a short-term thing. (Katherine Walla)

The End of October by Lawrence Wright. I loved this book because it foretells what a global pandemic might do to the modern world if one befell us… before COVID-19 came on the scene. (Barry Pavel)

The Ministry for the Future by Kim Stanley Robinson. It’s both science-fiction—a scary projection of what the devastating effects of climate change could be—and a guide to policy—explaining ways mankind might be able to collaborate in order to avoid the worst-case scenario. (Sandy Vershbow)

The Three-Body Problem by Cixin Liu, translated by Ken Liu. It’s a Chinese sci-fi masterpiece on how the world gets ready for an encounter of the third kind. (Ben Haddad)

This is How They Tell Me the World Ends by Nicole Perlroth. Nicole, one of the New York Times’s leads on cyber, writes about cyber leaks and attacks, and her book could not be better timed as our world is beset by malicious hacks and ransomware strokes seemingly every week. (Brian O’Toole)

Trick Mirror: Reflections on Self-Delusion by Jia Tolentino. Tolentino tackles the illusions and self-delusions we have constructed to continue existing in a social and political state that is as fundamentally backward as it is mandatory. Her writing speaks to the fundamental conflicts present in our modernity and gives voice to the restlessness it can inspire. (Jared Holt, also recommended by Andrea Snyder)

In Harm’s Way by John Cleveland and Peter Plastrik. “There are seven capacities that communities need to develop so they can undertake effective preparation for climate change,” the authors write. This book lays out those seven. (Andrea Snyder)

INSPIRATION: Lives, words, and stories to uplift

All We Can Save: Truth, Courage, and Solutions for the Climate Crisis, edited by Katharine K. Wilkinson and Ayana Elizabeth Johnson. The collection of poems, art, and essays sets out to highlight a wide range of women’s voices in the environmental and climate movement. It is a contemporary representation, and it’s beyond the way we wonks think about climate. (Kathy Baughman McLeod)

The Truths We Hold by Kamala Harris. I’ve chosen to read it because I love autobiographies and have long held a sneaking suspicion that she and I have many things in common and am reading to confirm my hunch! I find her personal and professional life interesting and want to learn how she ascended to her former role as US senator from California. (Clintandra Thompson)

Anxious People by Fredrik Backman. This one was on my to-read list for a long time. It is a terrific book, very timely for the years we are living in. The author talks about anxiety and personal struggle with a raw truth to it, and yet it is still comical! Highly recommended. (Fernanda Meirelles)

Here, Right Matters: An American Story by Alexander S. Vindman. As the child of a father who fled the Soviet Union in pursuit of a better life for his family, Vindman was raised with the values I believe make America special and resonate with so many of us, and I’m excited to read his tale of moral courage and determination in a unique moment in history. (Shelby Magid)

His Truth Is Marching On: John Lewis and the Power of Hope by Jon Meacham. The gripping story of how a poor Alabama sharecropper’s son helped change America. (Stephen Grand)

The Mayor of Castro Street by Randy Shilts. This is the most complete and informative book detailing the LGBTQI civil-rights movement during the second half of the twentieth century, with a specific focus on the life, career, and murder of Harvey Milk, one of the first openly gay people elected to political office in the United States. (Zachary Strauss)

Mistakes Were Made (But Not by Me) by Carol Tavris and Elliot Aronson. Just enlightening—after reading it, I became much more understanding, patient, and tolerant with people who have different points of view than my own. I consider this essential for those of us working on diversity, equity, inclusion, and social justice. I think every person in the world should read this book. (That’s how much I liked it!) (Adriana Lacerda)

Our Women on the Ground: Essays by Arab Women Reporting from the Arab World. The editor, Zahra Hankir, also teamed up with MENASource to publish a photo essay capturing the explosion in Beirut. (Samantha Treiman)

The Four Agreements: A Practical Guide to Personal Freedom by Janet Mills and Don Miguel Ruiz. This continues to be a great code of conduct guide and is as relevant today as it was when first released. With all of life’s changes that we’ve been experiencing, this book has helped keep me grounded and focused on being impeccable with my own words, not take things personally, not make assumptions, and to always do my best. (Kadiatou Cesaire)

We Should All Be Feminists by Chimamanda Ngozi Adichie. I like her take on different issues, this time on being feminist. (Tigest “Tea” Frew)

Calvin and Hobbes by Bill Watterson. Comic strip classic. Has there ever been a more inspiring couple? (Stephanie Wander)

Bird by Bird: Some Instructions on Writing and Life by Anne Lamott. I picked up this book to learn how to write short stories. (Tigest “Tea” Frew)

The Wild Muir by Lee Stetson. Twenty-two of famed conservationist John Muir’s greatest adventures. For the mountains of California. (Stephanie Wander)

Andrew Marshall is the Vice President of Communications for the Atlantic Council. He leads the Council’s media, digital, and editorial efforts, and coordinates the way the Council talks with its key communities.

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Fernandes on Forbes India: Health diplomacy needs an update https://www.atlanticcouncil.org/insight-impact/in-the-news/https-www-forbesindia-com-blog-health-covid-19-after-effect-health-diplomacy-needs-an-update/ Mon, 26 Jul 2021 18:57:30 +0000 https://www.atlanticcouncil.org/?p=418263 The post Fernandes on Forbes India: Health diplomacy needs an update appeared first on Atlantic Council.

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The post-COVID world this week: The UK ‘pingdemic,’ the lambda variant, and a post-pandemic rebuild based on empathy https://www.atlanticcouncil.org/blogs/coronavirus-alert/the-post-covid-world-this-week-the-uk-pingdemic-the-lambda-variant-and-a-post-pandemic-rebuild-based-on-empathy/ Sat, 24 Jul 2021 15:26:37 +0000 https://www.atlanticcouncil.org/?p=418036 What can we expect from a post-COVID world after a pandemic that has reshaped international affairs? A world in which the way we build the future will take some imagination.

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The future is here: A guide to the post-COVID world 07/24/2021

Welcome to your guide to where the world is headed during the pandemic era and beyond, from Andrew Marshall. Each week, we’ll bring you the latest and most significant expert insights and international news about how coronavirus is reshaping international affairs. To stay updated each week, sign up to the newsletter here.

Let’s take a spin around the globe, in seven minutes or less.

In top stories this week:

  • A “pingdemic”: The latest affliction to hit the United Kingdom
  • As delta becomes king, a new challenger emerges: lambda
  • While Canada erected welcome signs, the United States painted right over them
  • But first…

The big story

How good is your imagination? Can you really imagine what it means to live on a planet of nearly eight billion people, speaking perhaps seven thousand languages, living in nearly two hundred countries?

I thought about this while watching the 2020 Tokyo Olympics opening ceremony this week with my young daughter, as each country’s team trotted across the screen for its masked moment of joy. The television commenters did their best to make it meaningful, at one point describing Uzbekistan as “a little larger than California.” I tried to explain to my daughter where San Marino is, or why Andorra exists, or why Russia, like Voldemort, may not be named.

Let’s forget for a moment the enormous problems that this year’s Olympics are having with COVID-19 and focus on the positive. The world struts across your sitting room, and the finest athletes strain to do their best. It’s a nice moment of global solidarity and fellow feeling.

Many of us have hopes for something better for our planet when we leave the pandemic behind. “Historically, pandemics have forced humans to break with the past and imagine their world anew. This one is no different. It is a portal, a gateway between one world and the next,” wrote novelist Arundhati Roy last April. “We can choose to walk through it, dragging the carcasses of our prejudice… and dead ideas… Or we can walk through lightly, with little luggage, ready to imagine another world. And ready to fight for it.”

COVID-19 has indeed produced a sense of solidarity with others. Many communities saw demonstrations of support for health and front-line workers. Many of us supported efforts to get vaccines to other countries. But we have also witnessed vaccine nationalism, insularity, and communities sinking under the weight of infection while no one helped.

“This crisis is different. It’s a biological threat, and it’s global. Everyone has to change together to deal with it. That’s really history,” wrote Kim Stanley Robinson in the New Yorker at the outset of the crisis. A year on, and many of us are more focused on the state of housing prices and where we can go on vacation. Wealthy countries are manifestly failing to address the economic or health needs of poorer countries. Even within the wealthiest nations, rich communities thrive while poorer ones struggle.

This isn’t viable. “Leaders are dealing with the crisis on a largely national basis, but the virus’s society-dissolving effects do not recognize borders,” wrote former US Secretary of State Henry Kissinger last year. “The founding legend of modern government is a walled city protected by powerful rulers, sometimes despotic, other times benevolent, yet always strong enough to protect the people from an external enemy. Enlightenment thinkers reframed this concept, arguing that the purpose of the legitimate state is to provide for the fundamental needs of the people: security, order, economic well-being, and justice. Individuals cannot secure these things on their own. The pandemic has prompted an anachronism, a revival of the walled city in an age when prosperity depends on global trade and movement of people.”

The crisis began, in some ways, with a failure to imagine something bigger than ourselves. Even when the world knew that a pandemic had begun in China, those responsible failed to prepare, wrote Tim Lord, a senior fellow at the Tony Blair Institute for Global Change. “The fundamental issue was a failure of imagination. We couldn’t really imagine what a pandemic would be like. And because we couldn’t imagine it, we failed to adequately prepare for it.”

Lord draws the obvious parallel with climate change. “We struggle to imagine what the impacts of unabated climate change will really feel like when they are happening—because, for sure, while we’ve had some warming so far, it’s on track to get a whole lot worse unless we take urgent and fundamental action.”

The last few weeks have shown us what it will look like. It looks like a commuter in a flooded Chinese train struggling to keep their head above the water or like a Volkswagen floating down a street in Germany after a river bursts its banks.

It is too much to imagine other countries, perhaps. But as far as individuals are concerned, we can empathize with the images of a person struggling to stay alive. And when I think of the lives lost from COVID-19, it is not the statistics that come to mind but my friend in South Africa, a neighbor’s father in Peru, or a much-loved former colleague in the United Kingdom.

As we try to rebuild from the pandemic, that is the way to imagine a larger reality: not masses of statistics, or the abstractions of national suffering, but individuals around the world struggling to survive against the odds.

In the next two weeks, we will cheer for athletes from many other countries as they thrill us with their tenacity, humor, strength, resilience, and humanity. Through that experience, we can for a few weeks imagine others leading very different lives in different places, with whom we might just have something in common. In the end, it is the individuals we cheer for, not their flags.

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The world in brief

Insights from across the planet, in ten bullets or fewer

  • Indonesia is suffering a COVID-19 wave. The world’s fourth most populous country has one of the highest numbers of new cases in the world for the past week, with more than 300,000 new infections and more than eight thousand deaths. “Medical facilities in big cities across the island have for months been under immense pressure, unable to cope with the influx in patients. Many people have died at home, unable to find treatment,” reports the Guardian.
  • Africa warned not to relax as the virus eases. New COVID-19 cases in Africa have slowed, as the rate of new infections in South Africa declines. But infections outside South Africa continue to climb, and health authorities have warned that things may yet get worse. “Be under no illusions, Africa’s third wave is absolutely not over,” said Dr. Matshidiso Moeti, World Health Organization Regional Director for Africa. In good news for the continent, a South African firm will begin producing the Pfizer-BioNTech coronavirus vaccine, Pfizer announced Wednesday.
  • The United States is facing a new upsurge in cases. “COVID-19 cases nearly tripled in the U.S. over two weeks amid an onslaught of vaccine misinformation that is straining hospitals,” reports the Associated Press. “Health officials blame the delta variant and slowing vaccination rates. Just 56.2% of Americans have gotten at least one dose of the vaccine, according to the Centers for Disease Control and Prevention.” Washington, DC, is facing a scattering of new cases, including a White House staffer and a senior communications aide to House Speaker Nancy Pelosi.
  • A new variant is circulating in the United States. It only makes up 1 percent of US cases in recent weeks, but the lambda variant, first spotted in Peru, “has started to be identified in several states,” reports National Public Radio. The dominant delta variant now constitutes 83 percent of US cases.
  • The UK’s big reopening has not worked as planned. They call it the “pingdemic,” reports the New York Times. Throughout the United Kingdom, residents are getting pings from a government-sponsored contact-tracing app asking them to quarantine for ten days because they were in close quarters with someone who tested positive. The result is a cascade of shuttered businesses and disrupted services.
  • When will it be time to go back to Canada? The Canadian government announced that “as of August 9, fully vaccinated American citizens and permanent residents can enter the country for leisure via land crossings and nine airports,” reports National Geographic. Not so fast, said the United States, which renewed its own land border restrictions with Canada and Mexico through at least August 21—citing the spread of the delta variant, the Washington Post reports.
  • US mass transit is recovering very slowly. Last month, ridership across more than one hundred bus, subway, and commuter rail systems rose substantially—but still was barely more than one-third of 2019 levels, reports NBC, analyzing three years of data from the scheduling app Transit. “And transportation experts say the numbers might not rebound until the end of the year,” NBC adds.
  • It is OK to have fun again. The Financial Times has considered the issue and ruled that fun can now be had. Responding to epidemiologically unsound criticism of those who go to the beach, the paper’s Jemima Kelly says: “There’s no scientific reason to stop people enjoying themselves outside.”

The inside scoop

Insights from the Atlantic Council

Andrew Marshall is the Vice President of Communications for the Atlantic Council. He leads the Council’s media, digital, and editorial efforts, and coordinates the way the Council talks with its key communities.

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Can we distribute the burden of the COVID-19 pandemic more equitably? https://www.atlanticcouncil.org/blogs/southasiasource/can-we-distribute-the-burden-of-the-covid-19-pandemic-more-equitably/ Wed, 21 Jul 2021 11:33:50 +0000 https://www.atlanticcouncil.org/?p=415386 This piece follows three business owners in India whose livelihoods have been crippled by the COVID-19 pandemic. All of them are participants of the REVIVE initiative by Samhita.

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This piece follows three business owners in India whose livelihoods have been crippled by the COVID-19 pandemic. All of them are participants of the REVIVE initiative by Samhita.

Noor, a business owner from Ahmednagar, India, had been running her own parlor when the March 2020 lockdown came into force. While she and her family initially relied on their savings, they had to eventually borrow money from neighbours to make ends meet. As parlors were mandated to remain closed during this time, Noor used some of the money to start a tiffin service business. From January 2021, she started seeing a few customers at her original parlor while concurrently running the tiffin business. However, due to the second wave, both her businesses have been forced to shut down. With great difficulty, Noor found another job as a house cook, and is making enough to manage basic household expenses while her husband remains unemployed. Hopeful of recovery this year, Noor had made many plans–one of which was to send her daughter to an english-medium school–but because of the ongoing crisis, this has proven to be impossible.

Payal (from Delhi, India) too has been running her own parlor, but she and her husband have had no source of income since April 2021. “We are only consuming a bare minimum amount of food,” she says, “that which is necessary. Even though it’s mango season, I have not been able to buy any for my family”. Her mother recently tested positive for COVID-19 and suffered a high fever for one week. This, combined with the second COVID-19 wave, has left them feeling terrified. As parlour work is high-contact, Payal says that she feels unsafe about going out even when lockdown restrictions do eventually lift.

Kabir, also from Delhi, set-up a grocery store in January 2020. As he began establishing connections with his customers and generating a stable income, the three-month lockdown was imposed to curb the spread of COVID-19. This shut down his store permanently. In October 2020, Kabir launched another venture–making and selling masks–and grew it into a bigger handloom business while introducing other products over time. “Even this shop is closed now; the second wave and lockdown have prevented it from becoming stable. There is no way to earn an income if this keeps happening,” comments Kabir.

These are stories of but a few among millions who have lost multiple livelihoods because of the COVID-19 pandemic. It is clear that everyday people tried to absorb the damaging and continuous effects of the crisis, doing all they could to initially maintain some source of income. Without adequate and timely responses from both the government and private institutions, all they can rely on is their own resilience.  

However, the second COVID-19 wave has been exponentially more devastating. This is in part because of the rise in cases, increased severity of symptoms, and more deaths amongst a crumbling healthcare delivery system. And, it is coupled with an additional livelihood shock layered onto an ongoing burden. Many are dipping into their modest savings to make ends meet and reducing food consumption to survive. They have had to make tough decisions–to not pay fees for their children’s education, delay non-COVID-19 related surgeries, and stay indoors at all costs even though that has not guaranteed security. This has left people uncertain about their emotional recovery and economic revival. To distribute the burden of this recovery more equitably, we need to employ prompt solutions that support the most vulnerable.

Policy recommendations:

1. Small business owners should be provided monetary support to stay afloat in the present and working capital to restart their livelihoods in the future. One of the ways to deliver this effectively is to use a blended finance model of pooling in resources from companies and foundations, to provide direct benefit transfer (DBTs), and returnable grants. DBTs will offer much needed relief during the peak months of the crisis. Providing returnable grants to financially underserved communities will help people revive their businesses which otherwise might not be possible. Such a model, which is based on zero interest and no legal obligation to repay, will allow businesses the space and time to recover. 

2. For people to safely rejoin the workforce or continue providing essential frontline services and commodities, they need to be vaccinated. Kamlaben, a vegetable vendor from Ahmedabad says, “Police demand ‘health cards’, ‘negative RT-PCR report’ or a ‘vaccination card’ from us and don’t let us sell without it.” In addition to being fraught with procurement challenges, India’s current vaccination drive also reinforces existing inequities. The online registration-based model and limited walk-in facilities have led to the exclusion of poor and marginalized communities from the vaccination drive itself. 

A lack of access to vaccines not only limits people’s ability to earn income and establish a bare minimum standard of living, but more importantly impairs their basic rights to life and health. With the novel nature of this virus, knowledge around efficacy and side-effects of the vaccines has been riddled with misinformation. Hence, to assume vaccine hesitancy only among poorer sections of the population would be incorrect. Therefore, it is most valuable to first understand the gaps in information and accessibility among underserved communities. Consequently, we need to invest in awareness programs on knowledge, attitudes, and practices related to vaccines. This must be supplemented with support from on-the-ground organizations to help provide their communities access to the vaccine through online registration or walk-ins. The vaccine should also be prioritized for people on the frontlines, not only in policy but also in implementation. 

3. Before the pandemic, 90 percent of India’s poorest did not have access to health insurance and typically dipped into savings, borrowed, or delayed treatment in case of a health emergency. The COVID-19 crisis has not only led to unparalleled health shocks, but it has also led to inequitable systems of recovery, thereby further widening the inequities in health resources. This compels us to redesign insurance policies to suit the needs of those who need them most. In addition, we should also think of innovative ways to establish a health safety net such as a health savings account. According to a randomized evaluation in Kenya, access to savings products leads to substantial increases in preventive health investments and reduced vulnerability to health emergencies. Private companies can support individuals by funding initial instalments of these savings accounts.

When thinking about tackling further waves and eventually recovering from COVID-19, we should keep the needs and experiences of people–especially those most vulnerable–at the center of our approach, strategy, and implementation. While many have shown and continue to show tremendous self-reliance, there is a crucial need to reduce the burden of recovery on individuals. 

Iti Bhargava is a senior associate for Research & Knowledge at Samhita – CGF.

Ojas is a manager for Research & Knowledge at Samhita – CGF.

The South Asia Center is the hub for the Atlantic Council’s analysis of the political, social, geographical, and cultural diversity of the region. ​At the intersection of South Asia and its geopolitics, SAC cultivates dialogue to shape policy and forge ties between the region and the global community.

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The post-COVID world this week: France’s step back from normal, South Korea’s slow down, and the urban exodus we didn’t see https://www.atlanticcouncil.org/blogs/coronavirus-alert/the-post-covid-world-this-week-frances-step-back-from-normal-south-koreas-slow-down-and-the-urban-exodus-we-didnt-see/ Sat, 17 Jul 2021 11:00:00 +0000 https://www.atlanticcouncil.org/?p=415581 What can we expect from a post-COVID world after a pandemic that has reshaped international affairs? A world in which the great metropolises of the Western world are still standing, despite this major pandemic myth.

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The future is here: A guide to the post-COVID world 07/17/2021

Welcome to your guide to where the world is headed during the pandemic era and beyond, from Andrew Marshall. Each week, we’ll bring you the latest and most significant expert insights and international news about how coronavirus is reshaping international affairs. To stay updated each week, sign up to the newsletter here.

Let’s take a spin around the globe, in seven minutes or less.

In top stories this week:

  • England pulls back on COVID-19 restrictions while France hikes vaccine requirements.
  • South Korea’s new strategy to curb COVID-19: Drop the beats (per minute).
  • As the Tokyo Olympics begin, Japan is still in a state of emergency.
  • But first…

The big story

This week’s key theme: The rumored urban exodus may be the biggest pandemic myth.

People are heading back to the big cities. In fact, many never went far.

There were many predictions a year ago that the great metropolises of the Western world would soon be deserted and destitute as COVID-19 wreaked havoc. “From the moment U.S. coronavirus cases emerged in the Seattle area and then devastated New York City last spring, sweeping predictions about the future of city life followed…” reports Emily Badger of the New York Times. “The pandemic promised nothing short of the End of Cities, a prophecy foretold by pundits, tweets and headlines, at times with unveiled schadenfreude.”

That promise hasn’t panned out. Friends in the New York area report that the city remains a largely civilized place, or at least no less so than it was pre-pandemic. Some favorite restaurants and bars have gone, and there is certainly plenty of retail space available. But “food and beverage tenants were the most active in signing retail leases across Manhattan during the second quarter, according to commercial real estate services firm CBRE,” reports CNBC.

“It seems like this spring, after the vaccine had become widely available, people really started to stream back to the city from wherever they were living,” says New York Magazine’s Kim Velsey. “People who’d spent a year living with their parents or extended families were ready to live among friends, to socialize, to experience something close to their former life.”

There has been movement from cities to suburbs and to smaller towns further out in the countryside. But the idea of a massive shift away from the city to green fields and country lanes has been rewritten.

“The pandemic accelerated existing migration out of big cities into lower-density communities across the US and boosted demand for larger homes and increased residential mobility across neighborhoods. What it did not do was bring about the end of urbanization,” says a study from Freddie Mac.

“The invisible elastic that binds people to big cities has weakened rather than broken,” says the Economist, which put two researchers to work analyzing data from real estate website Zillow. “Covid-19 has not cancelled the appeal of the centres of the biggest cities. People still want to be near them, perhaps to commute a few days a week. They just don’t want to be in them.”

Citing recent Bank of America research, Business Insider says that “while the pandemic accelerated preexisting migration out of cities like New York City and San Francisco, those two are the only true examples [in the United States] of anything resembling an exodus, and reopening will spark a return to both cities.” Bank of America said urban exodus is “more myth than reality.”

The biggest analysis I could find is by Bloomberg, which parses data from the US Postal Service on changes of address and mail forwarding. “There is no urban exodus; perhaps it’s more of an urban shuffle,” it says. “Despite talk of mass moves to Florida and Texas, data shows most people who did move stayed close to where they came from—although Sun Belt regions that were popular even before the pandemic did see gains.”

Bloomberg continues, “Those Americans who did move accelerated a trend that predates the pandemic: Dense core counties of major U.S. metro areas saw a net decrease in flow into the city, while other suburbs and some smaller cities saw net gains. In other words, people moved outward. Outward to the suburbs of their own core metro area, but also farther out, to satellite cities or even other major urban centers that might still give people proximity to their region.”

One thing is clear though. Real estate prices have soared, as the wealthy in particular have bought new homes, trading up and often getting out of the city. The causes are a massive surge in demand, especially from the rich, a lack of supply that goes back to the 2008 Global Financial Crisis, and very low interest rates.

“Wealthier households have channelled windfall savings into equities and cryptocurrencies, Louis Vuitton handbags and Dutch masters. But most of all, they have poured money into buying bigger and better houses,” reports the Financial Times.

This has disproportionately hit lower-income and first-time buyers. “One of the most prominent housing issues in pre-pandemic America was supply shortages,” Matthew Murphy, executive director of the Furman Center For Real Estate and Urban Policy at New York University, tells NBC News. “That has carried over and exacerbated, but we already had evidence of supply shortages heading into the pandemic.”

As in other areas of socio-economic change, there are signs that COVID-19 hastened changes that were already under way—but also that its short-term effects might not persist. “I think it’s becoming more and more clear that the pandemic mainly pushed people out of New York who didn’t really want to be in New York before the pandemic, people who were already kind of eyeing the suburbs. Or Kingston [New York],” says Velsey. “Or Austin.”

There is little more hurtful than to accuse a New Yorker of really wanting to live in Texas; but perhaps that was true, for some.

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The world in brief

Insights from across the planet, in ten bullets or fewer

  • England’s COVID-19 restrictions are over, but the pandemic isn’t. England will enter its final stage of easing COVID-19 restrictions on Monday, the government has announced. Experts, however, are urging caution: Chris Whitty, chief medical officer, says the country will face an inevitable “exit wave” of infections.
  • France is cranking up its COVID-19 rules. In a speech ahead of France’s national day, President Emmanuel Macron announced forthcoming vaccination mandates, particularly for health workers, and turned up the pressure on unvaccinated people by requiring proof of vaccination to visit restaurants, cafes, and shopping centers. In his televised address, Macron dubbed vaccines “a key asset” in fighting “a strong resurgence of the epidemic,” reports the New York Times. The news fueled a mad dash among French citizens to get their shots, with more than one million signing up for vaccine appointments in less than a day, the Associated Press reports.
  • South Africa’s COVID-19 ordeal is monumental. The virus “may have dealt South Africa a blow that even AIDS could not, driving the country of my birth down the path of madness, a society slumping into the abyss…” writes journalist Farhad Manjoo in a moving piece in the New York Times. “Thanks to mass vaccination, it’s beginning to feel like morning in wealthy parts of the world, notwithstanding the social and political dislocations the virus has created in the United States. But on much of the rest of the planet it is still dark night.”
  • Cases of COVID-19 in Japan have hit a six-month high, with the Olympics set to open in a week. “Tokyo is under a fourth state of emergency, which began Monday and requires restaurants and bars to close early and not serve alcohol through the Olympics, which start July 23,” reports ESPN.
  • South Korea slows down for COVID-19. South Korea has banned fast music and fast running at some fitness clubs. “The concern is that intense exercising, especially in a group setting, could increase the likelihood of stray respiratory droplets and that all the sweat-and-spit slinging could lead to more COVID-19 cases,” explains National Public Radio. As a result, “gyms in the capital Seoul and other nearby areas are no longer allowed to play music faster than 120 beats per minute (the speed of “Call Me Maybe” by Carly Rae Jepsen) during group fitness classes.”
  • New York’s comedy clubs are reopening. Manhattan’s renowned comedy venues welcomed back familiar faces like Jerry Seinfeld, Dave Attell and [Gilbert] Gottfried in recent weeks,” says the New York Daily News. Comedy Cellar owner Noam Dworman recalled having “seen speculation about the culture changing for good with the pandemic—no hugs, no handshaking. And that lasted all of 20 seconds. People hugging, shaking hands, crying. It was elation. Very emotional all around.”

The inside scoop

Insights from the Atlantic Council

Andrew Marshall is the Vice President of Communications for the Atlantic Council. He leads the Council’s media, digital, and editorial efforts, and coordinates the way the Council talks with its key communities.

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Warrick testifies for the House Committee on Homeland Security https://www.atlanticcouncil.org/insight-impact/in-the-news/warrick-testifies-for-the-house-committee-on-homeland-security/ Thu, 15 Jul 2021 20:39:57 +0000 https://www.atlanticcouncil.org/?p=415130 Forward Defense and Rafik Hariri Center and Middle East programs Nonresident Senior Fellow Thomas S. Warrick testifies for House Committee on Homeland Security.

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On July 15, Forward Defense and Rafik Hariri Center & Middle East programs Nonresident Senior Fellow Thomas S. Warrick testified for the House Committee on Homeland Security. In the testimony, titled “Securing the homeland: reforming DHS to meet today’s threats,” Warrick discusses the missions of the Department of Homeland Security, the challenges it faces, and his endorsement of HR-4357, the DHS Reform Act of 2021.

I … urge the members of this committee to continue your efforts to make the Department more effective in protecting the American people from non-military threats.

Thomas S. Warrick

Forward Defense, housed within the Scowcroft Center for Strategy and Security, generates ideas and connects stakeholders in the defense ecosystem to promote an enduring military advantage for the United States, its allies, and partners. Our work identifies the defense strategies, capabilities, and resources the United States needs to deter and, if necessary, prevail in future conflict.

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Ngozi Okonjo-Iweala on how the WTO can tackle vaccine scarcity and global recovery https://www.atlanticcouncil.org/blogs/new-atlanticist/ngozi-okonjo-iweala-on-how-the-wto-can-tackle-vaccine-scarcity-and-global-recovery/ Wed, 14 Jul 2021 15:03:06 +0000 https://www.atlanticcouncil.org/?p=414381 The unequal global recovery from the COVID-19 pandemic is fragile, warned World Trade Organization Director-General Ngozi Okonjo-Iweala, and “there’s one thing behind that all: The issue of vaccine equity.”

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The unequal global recovery from the COVID-19 pandemic is fragile, warned World Trade Organization (WTO) Director-General Ngozi Okonjo-Iweala, and “there’s one thing behind that all: The issue of vaccine equity.” 

“We’re not really going to have what is [a] sustainable recovery” as long as vaccine scarcity continues, Okonjo-Iweala said at an Atlantic Council Front Page event hosted by the Council’s GeoEconomics Center. “The supply scarcity is driving behavior,” she said, not only fueling countries to competitively bid on vaccines, but also to “bid away vaccines from COVAX,” the global coalition tasked with improving COVID-19 vaccine access. “That’s why COVAX has been struggling to deliver what it should.” 

Okonjo-Iweala outlined ways the WTO can alleviate the scarcity problem across the supply chain for COVID-19 vaccines: by encouraging the removal of trade restrictions while working with manufacturers to unlock bottlenecks and spread their production expertise. “Without the transfer of technology and know-how, you also cannot manufacture or increase output,” she said. Members of the WTO are negotiating a proposal to waive intellectual property rights for COVID-19 vaccines, and Okonjo-Iweala hopes “they will come to a conclusion that is pragmatic, allowing developing countries to have access but also [protecting] research, development, and innovation.” 

Meanwhile, the WTO, International Monetary Fund, World Bank, and World Health Organization proposed a $50 billion plan to end the pandemic, foster a sustainable recovery, and generate an estimated $9 trillion in global economic returns by 2025. Okonjo-Iweala said the plan includes $10 billion allocated to boosting preparedness for and prevention of future pandemics. 

Here are some of the highlights of Okonjo-Iweala’s vision for the WTO, from her plans to revive trust among its members to her philosophy on bringing the trade body into the digital era. 

A trust-building exercise ahead 

  • Among the WTO’s challenges, “there is a trust deficit between members: between developed countries and developing countries, between China, the US, the EU… You name it, in any configuration,” said Okonjo-Iweala. “[Trust] is something that we really need to build up.”  
  • She suggested that one way to build trust is to revive the WTO’s original purpose set out in the organization’s founding document, the 1994 Marrakesh Agreement. The “WTO is supposed to help enhance living standards for people, create employment, and support sustainable development. This is all about people,” Okonjo-Iweala said. If the organization aims to “make things better for people, then it wouldn’t take twenty years to negotiate an agreement” that benefits people. 
  • The comment alluded to the WTO’s twenty-year negotiations on prohibiting fishing industry subsidies that contribute to global overfishing. Trade ministers will meet to discuss the issue on July 15, and Okonjo-Iweala noted that this meeting may “kick us along the path towards agreement” by the end of 2021. The leader of the negotiations, Permanent Representative of Colombia to the WTO Santiago Wills, has produced a draft agreement “that so far, nobody has thrown out,” Okonjo-Iweala noted. 
  • If WTO members can strike deals such as a fisheries subsidies agreement and “work in these multilateral ways together,” Okonjo-Iweala said, that can begin “to build the trust that you can work together and you can deliver together.” 

Watch the full event

A mission to get with the times 

  • The WTO will also have to “update its rules and move with the times” to build trust among its members, said Okonjo-Iweala. “The world is going digital,” she noted, but she also acknowledged that “the WTO does not yet have an agreement” on digital trade and e-commerce regulations.  
  • With her vision focusing on inclusive growth, Okonjo-Iweala said that a WTO approach to digital is key. She noted that during the pandemic, small- and medium-sized enterprises with digital access avoided shutting down entirely. Women specifically own many of these enterprises, “and when they do have access to the Internet, they can directly connect with their customers, and this is very helpful.” Thus, she concluded, “in order to have a fair, transparent, and level playing field for digital trade, and to solve many of the issues about cross-border data flows, you need some agreement.” 
  • Okonjo-Iweala admitted that, while trade lifted people out of poverty, “people have been left behind.” She partially attributed that to protectionism and to technological changes in economic sectors. Weeks after the Biden administration released a plan for a new US industrial policy in an Atlantic Council speech, Okonjo-Iweala noted that industrial policy can be helpful in building infrastructure (like internet access) but cautioned that “industrial policies that lead to protectionism [are] something we need to watch,” and could be “against WTO rules” depending on their approaches. 
  • Okonjo-Iweala said that eighty-three WTO members are participating in plurilateral negotiations to modernize trade rules for a digital world. “We’re very hopeful that… [by] the next [ministerial], we would be able to come up with an agreement with a set of rules that can help us underpin digital trade.” 
  • But in equipping the WTO to deal with modern challenges, she acknowledged that helping to solve trade’s health and environmental issues, alongside digital issues, will be urgent, too. “I believe we can do it. We can’t do them all at once, but we can sequence what we want to do.” 

Support for Africa’s largest trade endeavor 

  • Okonjo-Iweala is both the first woman and the first African to lead the WTO. The Nigeria native hailed the African Continental Free Trade Area (AfCFTA), which came into effect in January, as “one of the best things I think the continent has done. … The WTO has been a foundation for putting these rules together and, I hope, will be a companion as we try to implement [it].” 
  • She noted that the WTO is ready to partner with the AfCTFA on issues like digital trade and improving Internet access. “We have a lot of work that we can do together to breach the digital divide,” she said. 
  • Among the ways the WTO can support the AfCTFA, Okonjo-Iweala mentioned that the trade organization can help reduce barriers to the movement of goods and services across borders and encourage investment to create value-added exports and keep jobs on the continent. 

Time for reform? 

  • When asked about differences in opinion among WTO members over issues like the benefits of free trade and the role of the dispute-settlement system, Okonjo-Iweala pushed back by saying that members “believe that trade and trade liberalization is the right way to go,” but that they differ on the way “they put this into practice.”  
  • And while the differences in opinion may pose challenges for the WTO, they don’t erode the organization’s utility, said Okonjo-Iweala, arguing that instead of labeling the WTO as dysfunctional, members should come together to make it work better. “Is the best answer to walk away and say this doesn’t work? This organization, the WTO, has worked for the US, has worked for China, has worked for the UK and the EU, and lifted hundreds of millions out of poverty and enriched economies. It is still the same organization,” she said. 

Katherine Walla is the assistant director of editorial at the Atlantic Council.  

Further reading

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Event recap: “REVIVING India’s informal workforce and entrepreneurs” https://www.atlanticcouncil.org/commentary/event-recap/event-recap-reviving-indias-informal-workforce-and-entrepreneurs/ Wed, 14 Jul 2021 13:48:13 +0000 https://www.atlanticcouncil.org/?p=414382 Overall, the pandemic transformed how we look at the needs of micro-entrepreneurs, women entrepreneurs, and those within the informal sector. It amplified the need to address the inequality within communities while also pushing various sectors, including commercial and non-profit, to push the boundaries on what recovery means. COVID-19 gave businesses opportunities to stand up for the most vulnerable. In doing so, the REVIVE alliance has helped set the stage for a new, resilient normal.

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On June 23rd, the Atlantic Council’s South Asia Center hosted a conversation with leaders of the REVIVE Alliance on the impact of the COVID-19 pandemic on the livelihood and resilience of the informal sector in India. The REVIVE alliance is a blended finance facility organized by Samhita-Collective Good Foundation (CGF), and funded by the US Agency for International Development in India (USAID), Michael & Susan Dell Foundation (MSDF), Omidyar Network India, British High Commission, New Delhi, and United Nations Development Programme (UNDP). This alliance involves various stakeholders dedicated to creating short-term economic recovery mechanisms and supporting long-lasting community building.

The panelists included South Asia Center non-resident senior fellow Dr Amita Vyas; Priya Naik founder and CEO of Samhita Social Ventures; Alison Eskesen, vice president of Mastercard Center for Inclusive Growth; and Rahil Rangwala, director of India programs at Michael & Susan Dell Foundation India. This conversation was moderated by Imrana Khera, partnership advisor at USAID/India.

Reflecting on the impact of COVID-19

COVID-19 hit India with immense force, creating a significant dent on what looked like a linear road to recovery. Amidst a strict national lockdown in the first wave and stringent decentralized lockdowns across India in the second wave, all the panelists called attention to the severity of the pandemic. Dr Vyas highlighted the bleak reality in post-March India, as well as the low vaccination rate. Likewise, Mr Rangwala highlighted the significant destruction of livelihood as well as the loss of life. In particular, he called attention to  the loss of almost 10 million jobs in the second wave alone, declining household income, and the inflicted cross-sectoral damage. The impact of COVID-19’extends far beyond the overexerted pressure on healthcare systems. It brought the gaps in education, economic exclusion, and vast inequalities within society into the limelight. Furthermore, in a country with an already low women’s participation rate in the labor force, Ms Eskesen pointed out, COVID exacerbated inaccessibility while also exposing the lack of financial inclusion for women and members of the informal sector. All in all, the pandemic was “unveiling cracks already there,” stated Ms Eskesen. The pandemic’s effects, as the panelists stressed, are all interconnected; thus, solutions too must be innovative, quick, and mindful of this reality. 

Reviving the informal sector amidst a global pandemic 

COVID-19 created a need for a response that was inclusive and urgent. In particular, Ms  Naik outlined what can be described as the need for an “integrated recovery” and “integrated support.” After establishing the on-the-ground realities of COVID-19, the panelists were able to share the various ways their organizations turned the challenges of the pandemic into opportunities for growth. As founder and CEO of Samhita Social Ventures, Ms Naik shared how her foundation was able to identify the gaps within the recovery process and identify essential tools such as digitalization and business development, which helped individuals and businesses hit hardest by the pandemic. Given the unequal impact of the pandemic, in particular the burden on women, her foundation targeted their efforts beyond just financial aid, focusing on the importance of confidence-building, and mental health support as well. Ms Eskesen highlighted a similar mission towards livelihood revival at Mastercard, emphasizing the importance of enabling small and micro-businesses to adapt to large shocks such as this pandemic through digitization and modernization. Empowering these businesses and individuals through credit access, and enhancing the recovery process for companies was another key goal of Mastercard’s efforts. For example, Mastercard identified the needs of smaller retail stores known locally as ‘kiranas’ and extended their aid to help them adapt to the formal sector while also realizing other areas for improvement, including reducing gender imbalance. Mr Rangwala from MSDF also shared how the pandemic pushed his organization to evaluate the newly emerging needs in response to the financial perspective of the crisis. Given the rise in risk aversion and a need for U-shaped recovery, Mr Rangwala identified the importance of “stretching the dollar,” or finding ways to help more people given limited resources. Overall, COVID-19 amplified the need for agility, inclusivity, and innovation, which inspired the REVIVE alliance. This collaborative effort connects stakeholders on every level. A critical facet of this endeavor includes the idea of returnable grants, which enables money to be cycled, and reduces the risk involved for those hurt most by the pandemic. Likewise, REVIVE is innovative in the way that it connects a variety of stakeholders, allowing what Ms Naik describes as “co-creating” impact, and allowing partners (including but not limited to corporations, philanthropic institutions, micro-entrepreneurs) to share their expertise without rigid arrangements, as well as create individualized solutions for individual problems. 

Overall, the pandemic transformed how we look at the needs of micro-entrepreneurs, women entrepreneurs, and those within the informal sector. It amplified the need to address the inequality within communities while also pushing various sectors, including commercial and non-profit, to push the boundaries on what recovery means. COVID-19 gave businesses opportunities to stand up for the most vulnerable. In doing so, the REVIVE alliance has helped set the stage for a new, resilient normal. In particular, the panelists emphasized how returnable grants and other tools can help address the unique needs of those in the informal sector, the rising importance of digitization (made even more imminent by COVID-19), and issues of accessibility to financial resources. Through collaborations like REVIVE, the boundaries of recovery were pushed. The result was empowerment that extended beyond a single instance, making what Ms Naik describes as “impact with ambition,” which allowed for the creation of a support network for vulnerable communities. 

Building towards a resilient and inclusive future.

Looking forward, there is a lot to learn from both the process and recovery from the COVID-19 pandemic. The pandemic has pushed for innovative collaborations, of which REVIVE is a thriving example. Given the distinctiveness of this collaboration, Mr Rangwala stated that there is an “obligation to learn from this experience.” In particular, because returnable grants have not been used in this manner or scale, consistent monitoring and continuous assessment are crucial to continuing to build towards a more equitable and resilient economy. Likewise, Dr Vyas highlighted the challenges of creating quick impact, stating, “impact doesn’t happen overnight.” Lastly, given the many stakeholders that have played a role in supporting the recovery process, the panelists were asked to expand on how the diaspora can address the situation. Ms Eskesen outlined the unique role the Indian diaspora, particularly in the US, can play. Given their deep understanding of Indian culture and customs as well as American innovative business practices, she argued that they can “meld both worlds.” Furthermore, Mr Rangwala explained some concrete ways in which the diaspora can direct their efforts on the ground to India’s “lively non profit collaborative network,” by supporting a framework already set up and well suited for the task. However, the efforts for recovery extend, as Dr Vyas pointed out, beyond the diaspora. In particular, she shared the various ways in which individuals and companies have already helped. Furthermore, the opportunity to extend a helping hand has not been exhausted, especially with the urgency surrounding vaccine accessibility and awareness, as outlined by the panelists.

Overall, recovery is more than just rebuilding the economy to what it was; it is about reimagining what it can be. This conversation highlighted the pivotal role COVID-19 played in exposing inequalities and creating the opportunity to amend these realities. The panelists stressed the importance of supporting vulnerable communities to build a better, more equitable society. Dr Nooruddin closed the conversation on the following key takeaway of the day, that recipients of assistance “on the ground are not beneficiaries, they are partners in rebuilding the economy.” Cognizant of this reality, REVIVE sets the stage for a hopeful future, where collaborative efforts extend beyond just crisis relief; instead, they focus on building inclusive and empowered communities. 

Ayra Khan is a research assistant at the Atlantic Council’s South Asia Center.

The South Asia Center is the hub for the Atlantic Council’s analysis of the political, social, geographical, and cultural diversity of the region. ​At the intersection of South Asia and its geopolitics, SAC cultivates dialogue to shape policy and forge ties between the region and the global community.

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Okonjo-Iweala’s remarks on vaccine distribution analyzed in Financial Times https://www.atlanticcouncil.org/insight-impact/in-the-news/okonjo-iwealas-remarks-on-vaccine-distribution-analyzed-in-financial-times/ Tue, 13 Jul 2021 19:50:00 +0000 https://www.atlanticcouncil.org/?p=414273 Read the whole article here.

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Read the whole article here.

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State of the Order: Assessing June 2021 https://www.atlanticcouncil.org/commentary/blog-post/state-of-the-order-assessing-june-2021/ Sat, 10 Jul 2021 14:18:36 +0000 https://www.atlanticcouncil.org/?p=413765 The State of the Order breaks down the month's most important events impacting the democratic world order.

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Reshaping the order

This month’s topline events

Biden Rallies the G7. On his first overseas trip as president, Joe Biden joined the leaders of the G7 group of democracies in Britain for a summit, resulting in commitments to provide one billion COVID-19 vaccines to developing nations, as well as agreements on a global minimum tax and a major new initiative to finance infrastructure projects in the developing world to counter the influence of China. Biden later traveled to Brussels for his first summit with NATO leaders, and separately, with EU leaders, securing joint statements of concern over China and Russia and pledging to work together to advance a rules-based international order. 

  • Shaping the order. Biden’s participation in this sequence of summit meetings showcased a renewed US commitment to democratic alliances and signaled that America is back as a multilateral leader on the global stage. The summit statements reflect shared concerns over Russia and China and an emerging consensus among allies on the need to prepare for an era of strategic competition between democracies and autocracies, though the US and Europe continue to differ in certain areas on how assertively to deal with Beijing. 
  • Hitting Home. Closer cooperation with allies could help place the United States in a stronger position to act on key challenges at home, including pandemic recovery, and to defend against threats to American security and economic interests.
  • What to do. Biden should continue to push for a common strategy among allies to deal with China and Russia, strengthen and update global trade norms, and seek to create new mechanisms to promote democratic cooperation, including a potential D-10 and a technology alliance to harness advanced technologies and develop common norms and policies consistent with democratic values.  

A New Atlantic Charter. While in London, Biden joined British Prime Minister Boris Johnson in signing a New Atlantic Charter that sets forth a statement of shared values and common aspirations. Like the original Atlantic Charter signed by Britain and the US in 1941, the new document lays out eight fundamental principles for a stable and secure global order, including the need to address new challenges such as emerging technologies, cyber threats, and climate change.  The document was criticized by Russian foreign minister Sergey Lavrov as “ideologically tainted” and by China’s Global Times as “misreading the trend of time.”

  • Shaping the order. The New Atlantic Charter offers an affirmative vision in stark contrast to a world dominated by autocracies like China and Russia and could serve to galvanize the free world to act together to address shared challenges. But what made the original Atlantic Charter so compelling was the action it inspired, including new rules and norms governing the behavior of states, and new institutions that the United States and its allies and partners used to defend and enforce these rules. To succeed in shaping a revitalized global order, this same spirit will be required again today. 
  • Hitting Home. As with the original document, the Atlantic Charter 2.0 could provide a blueprint for organizing a world that fosters a new era of security and prosperity for America and its citizens.
  • What to do. Biden should encourage other leading democracies that share the charter’s vision to sign on and work together to support it. The administration should follow by taking concrete steps to create new institutions that would advance the charter and rally the world’s democracies to action behind the principles in the charter.

Biden-Putin Meeting.  Biden ended his visit to Europe by meeting with Russian president Vladimir Putin in Geneva. During the nearly three hours of talks, Biden reportedly raised concerns over Russian cyberattacks; human rights violations, including the imprisonment of opposition leader Alexey Navalny; and aggression against Ukraine. The two leaders agreed to launch a strategic stability dialogue to deal with issues such as arms control and cyberattacks, and to send ambassadors back to each other’s capitals.

  • Shaping the order. Biden’s call-out of Russia’s behavior on human rights  and foreign interference suggests that US-Russia relations are likely to continue to be framed as a clash of values and interests, in the context of US support for an international rules-based order. Despite the launch of a new strategic dialogue and efforts by the Biden administration to cast the meeting as “positive” and “constructive,” the Kremlin appears undeterred from its current course of malign activities.
  • Hitting Home. As demonstrated by recent ransomware attacks against US companies, including Colonial Pipeline, cyberattacks originating from Russia continue to pose threats to the US and could disrupt Americans’ daily lives
  • What to do. Washington should continue to press Moscow to take action against cybercriminals based in Russia, release Navalny, and cease its broader efforts to undermine the rules-based order, while working closely with allies on a common strategy to raise costs on Moscow for such behavior.   

Quote of the Month

America is better positioned to advance our national security and our economic prosperity when we bring together like-minded nations to stand with us… Our alliances weren’t built by coercion or maintained by threats.  They’re grounded on democratic ideals and a shared vision of the future … where the rights of all people are protected… where nations are free from coercion or dominance by more powerful states; [and] where the global commons … remain open and accessible for the benefit of all.” 


– President Joe Biden, United Kingdom, June 9, 2021

State of the Order this month: Strengthened

Assessing the five core pillars of the democratic world order    

Democracy (↑)

  • In response to Belarus’ forced landing of a Ryanair flight in May and the government’s ongoing crackdown against pro-democracy protestors, the United States, European Union, United Kingdom and Canada announced coordinated sanctions on dozens of Belarusian individuals and entities, with additional sanctions likely to come.
  • G7 leaders, joined by the leaders of Australia, India, South Africa, and South Korea, signed an Open Societies Statement that reaffirmed shared commitments to democratic values, human rights, and freedom of expression.
  • Hong Kong’s largest pro-democracy newspaper, Apple Daily, was forced to shut down and its editors faced arrest as Beijing expanded its assault on democratic institutions in the autonomous territory.
  • With the actions against Belarus and the priority placed on support for democracy at the G7, NATO, and EU Summits, the democracy pillar was strengthened.

Security (↑)

  • Meeting in Brussels, NATO leaders reaffirmed their commitments to collective defense and advancing a rules-based order, while citing a range of traditional and evolving security challenges, including those posed by Russia and China.
  • Conservative cleric Ebrahim Raisi, a protégé of Iranian Supreme Leader Ayatollah Khamenei, was elected as Iran’s next president, in a move widely seen as orchestrated by Khamenei to ensure that his hardline vision for Iran, contentious with the United States and the West, is maintained.
  • China and Russia announced the extension of a friendship and cooperation treaty, originally signed in 2001, that Chinese President Xi Jinping said demonstrated the importance of strategic cooperation between Moscow and Beijing in defending their common interests on the global stage.
  • Ransomware attacks, reportedly organized by groups based in Russia, continued to target American companies, including the world’s largest meat supplier, JSB Foods, which paid $11 million to the hackers. 
  • In light of the NATO summit pronouncements, the overall security pillar was strengthened.

Trade (↑)

  • After years of negotiations, G7 nations agreed to a new global minimum tax of 15 percent on multinational corporations, regardless of where their headquarters are located. Over 130 nations, including all members of the G20, have now endorsed the agreement.
  • The United States and the European Union agreed on a temporary resolution of a 17-year dispute over aircraft subsidies to Boeing and Airbus, suspending tariffs for five years and committing to a more open and transparent process for research and development funding.
  • The United States and the EU also agreed to create a new Technology and Trade Council, aimed at devising new standards for emerging technology, promoting democratic values online, and advancing collaboration on cutting-edge research.
  • With these important developments, the global trade pillar was strengthened.

Commons (↑)

  • G7 leaders pledged to provide one billion coronavirus vaccines to the developing world over the next year, with the United States committing to half of this amount.
  • The G7 also agreed to step up action on climate change by committing to cut emissions in half by 2030 and renewing a pledge to raise $100 billion a year to help developing countries move to cleaner energy sources. 
  • China launched a rocket to send the first astronauts to its new space station, a significant step in what could become an intensifying space race between China and the United States.
  • Overall, the global commons pillar was strengthened.

Alliances (↑)

  • As discussed above, President Biden joined G7 leaders for a summit in Britain that reaffirmed US relations with key democratic allies. 
  • Biden also joined NATO leaders for a summit in Brussels that showcased allied solidarity and resulted in a strongly-worded communique in which allies agreed to language calling out Russia and highlighting the “systemic challenges” posed by China.
  • Biden participated in a separate US-EU summit meeting in Brussels demonstrating strong US support for the EU after years of sharp criticism by former president Trump, and which set forth a “Joint Transatlantic Agenda” aimed at building a more democratic world and upholding a rules-based order, potentially bringing together EU and US regulatory power.
  • Overall, the alliances pillar was strengthened.

Strengthened (↑)________Unchanged (↔)________Weakened ()

What is the democratic world order? Also known as the liberal order, the rules-based order, or simply the free world, the democratic world order encompasses the rules, norms, alliances, and institutions created and supported by leading democracies over the past seven decades to foster security, democracy, prosperity, and a healthy planet.

This month’s top reads

Three must-read commentaries on the democratic order     

  • Joe Biden, in a Washington Post op-ed, contended that his trip to Europe was about rallying democracies to meet the challenges and deter the threats of a new age.
  • Hal Brands, in Foreign Affairs, argues that Biden’s emerging foreign policy doctrine focuses on a grand strategy of fortifying the democratic world against the most serious set of threats it has confronted in generations.
  • Mira Patel, writing for the Indian Express, suggests that the New Atlantic Charter is being seen as a rebuke of China and Russia and could help renew the US-UK “special relationship.”

Action and analysis by the Atlantic Council

Our experts weigh in on this month’s events

  • In an Atlantic Council report, From the G7 to a D-10: Strengthening Democratic Cooperation for Today’s Challenges, Ash Jain and Matthew Kroenig, in collaboration with Tobias Bunde, Sophia Gaston, and Yuichi Hosoya, suggest a new D-10 to foster strategic alignment and coordinated action among like-minded and influential democracies.
  • Fred Kempe, writing for CNBC, contends that Biden’s trip to Europe was aimed at providing a narrative thread and building common cause among the world’s leading democracies against authoritarianism
  • Andrew Marshall, in the New Atlanticist, provides an analysis of the New Atlantic Charter.
  • In an op-ed in The Hill, David Gordon and Ash Jain contend that Biden needs a D-10 to rally the democracies in an era of strategic competition.
  • Lisa Aronsson and Brett Swaney, in the New Atlanticist, highlight three priorities for NATO’s new Strategic Concept in light of increasing competition with Russia and China.
  • Nilofar Sakhi, in the New Atlanticist, suggests that China, Russia, and Iran are seeking to expand their influence in Afghanistan, which they view as a battlefield for strategic competition with the United States.
  • Dan Fried, in the New Atlanticist, analyzes whether Biden’s building of a foreign policy doctrine around democracy is likely to succeed.
  • In a Fast Thinking commentary, Dan Fried and Ash Jain discuss the potential implications of the New Atlantic Charter.

__________________________________________________

The Democratic Order Initiative is an Atlantic Council initiative aimed at reenergizing American global leadership and strengthening cooperation among the world’s democracies in support of a rules-based democratic order. Sign on to the Council’s Declaration of Principles for Freedom, Prosperity, and Peace by clicking here.

Ash Jain – Senior Fellow
Dan Fried – Distinguished Fellow
Jeffrey Cimmino – Assistant Director
Joel Kesselbrenner – Program Assistant
Paul Cormarie – Georgetown Student Researcher
Audrey Oien – Young Global Professionals Intern

If you would like to be added to our email list for future publications and events, or to learn more about the Democratic Order Initiative, please email AJain@atlanticcouncil.org.

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The post-COVID world this week: The global path to normalcy, the Delta variant’s threat, and the pandemic-era exodus to the outdoors https://www.atlanticcouncil.org/blogs/coronavirus-alert/the-post-covid-world-this-week-the-global-path-to-normalcy-the-delta-variants-threat-and-the-pandemic-era-exodus-to-the-outdoors/ Fri, 09 Jul 2021 18:19:44 +0000 https://www.atlanticcouncil.org/?p=413349 What can we expect from a post-COVID world after a pandemic that has reshaped international affairs? A world in which a pandemic-era exodus to the outdoors may change the way we live, even in normal times.

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The future is here: A guide to the post-COVID world 07/09/2021

Welcome to your guide to where the world is headed during the pandemic era and beyond, from Andrew Marshall. Each week, we’ll bring you the latest and most significant expert insights and international news about how coronavirus is reshaping international affairs. To stay updated each week, sign up to the newsletter here.

Let’s take a spin around the globe, in seven minutes or less.

In top stories this week:

  • Some of us are on our way back to normal. The Economist has the index to prove it.
  • How Delta, the COVID-19 variant on steroids, poses new challenges for the United States.
  • The United Kingdom’s next move toward becoming the “most unrestricted society in Europe.”
  • But first…

The big story

This week’s key theme: The pandemic-fueled rise in camping may signal a big shift in how we live.

This weekend, I am going camping. My family enjoyed the great outdoors before COVID-19, but we did it more last year—being rural, remote, and socially distanced felt great. And it did for tens of millions of others across America.

“If it seemed in 2020 like campsites were harder to find, trails were more congested, summits were more crowded and trailhead parking spots were more full—they were,” the Daily Camera of Boulder, Colorado reports.

This year, the Fourth of July weekend saw record-setting crowds at state parks and campgrounds across the state of Michigan, reports Fox 17 from Kalamazoo, adding that “This past weekend, state parks were nearly 96% occupied and lines formed at many entrances with visitors waiting to get in.” And camping, in particular, is hot.

“The trend began almost immediately after the first wave of lockdowns fell in place,” says the Observer which described how Jeff Cavins, cofounder of a shared recreational vehicle (RV) rental marketplace called Outdoorsy, thought his company “would have to give up the entire spring season of 2020 as the coronavirus ravaged the nation,” but instead saw increased demand: Booking revenue grew 4,000 percent from April to October 2020, the Observer reports.

If you have a mental image of these campers that is something like an older white man in a plaid shirt, then ditch it. “In fact, 6-in-10 first-time campers are now from non-white groups and the overall representation of campers in the US is very closely aligned to Census figures,” says The North American Camping Report from Kampgrounds of America. “The ‘average’ camper is evolving and with it, we are seeing more people from backgrounds of all types finding their own space in the great outdoors.” Nearly one-fourth of new campers are African American. Three-fourths of campers are from households with children.

And if your mental image included a small tent in the wilderness, then that’s not right either. Many of the new campers went for RVs, the large homes-on-wheels long beloved by Americans and now newly popular. “Year to date, Outdoorsy has already seen a 145 percent growth,” says the Observer. The demographic of RV campers is changing too, as Millennials and Gen X members made 80 percent of Outdoorsy’s new bookings. “The RV industry has historically been [a business for] Boomers and retirees. That has completed shifted now. It’s a young people’s game,” the Observer quoted Cavins as saying.

Many also went “glamping”—camping with a luxury element. That includes new options like fancy tents already set up with comfortable beds and furniture, but also unique options like covered wagons, tree houses, and yurts—a type of circular tent adapted from a traditional structure favored by nomadic Mongolians. “In 2021, the number of searches for unique homes on Airbnb has grown 94% compared to the same period in 2019,” says Airbnb in a survey of user habits on their site. “The number of unique listings on Airbnb, over 170,000, has grown 31% in two years.”

The new camping generation wants more than a tent and some hot dogs over the fire. Campers want WiFi, even if many of them also see it as a chance to digitally detox. And many are doing it through apps like Outdoorsy for RVs, but also Dyrt for campsites and Hipcamp for camping, treehouses, and glamping.

This outdoors surge is not without its costs. “During three weeks of road-tripping in Colorado, Utah, and Wyoming, every camping area I saw was packed—front country and backcountry alike, established and dispersed,” Krista Langlois writes in Outside Online. “I heard stories from friends who simply couldn’t find a place to camp and were forced to get a hotel room. Other people pulled over on the side of the road and slept in their cars. Still, others ignored the rules and camped where they weren’t supposed to, leaving behind fire scars, trampled vegetation, and unburied human waste. It was, quite literally, a shit show.” National Parks are struggling to deal with the crowds, and some state parks are increasing their charges.

But there is also a shift going on in how people see the outdoors, writes Good Housekeeping, quoting Jon Gray, chief executive officer of RVshare, an RV rental marketplace: “The ethos of [camping and] RV travel has moved quickly from, ‘I want to get off the grid and not be able to access the internet,’ to, ‘I want this RV to be an extension of my office, my classroom, my life.’”

Maybe it even presages a wider shift in the way we think about where we live and how we live. “As pandemic restrictions gradually lift and travel restarts, it’s looking different,” says Airbnb. “We are shifting from traveling at all the same times to all the same old places, to many of us living anywhere, at any time, for however long. This is not a temporary reaction to these many months of restrictions and isolation—it’s a step toward a world in which living and traveling are one and the same.” Maybe lines really are blurring: indoors/outdoors, home/away, working/living.

Or perhaps that’s just marketing, and we will all be back indoors later this year as the pandemic (hopefully) wanes and the weather turns cold. I shall contemplate it this weekend in my yurt in Virginia.

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The world in brief

Insights from across the planet, in ten bullets or fewer

  • The Delta variant poses an increasing threat, even in the United States. “Twenty-four states have seen an uptick of at least 10% in COVID-19 cases over the past week… as health experts and the federal government keep pressing for more people to get vaccinated,” says CNN, citing Johns Hopkins University data. Andy Slavitt, a former senior adviser to US President Joe Biden’s COVID-19 Response Team warns, “We should think about the Delta variant as the 2020 version of COVID-19 on steroids,” adding, “It’s twice as infectious. Fortunately, unlike 2020, we actually have a tool that stops the Delta variant in its tracks: It’s called vaccine.”
  • So many of our audiences went virtual; the Tokyo Olympics’ will too. The games are proceeding a year behind schedule after being fraught with issues posed by the pandemic. “Olympic organizers said on Thursday that they would bar spectators from most events at the Games scheduled to open in two weeks, a decision that followed the declaration of a new state of emergency in Tokyo in response to a sudden spike in coronavirus cases,” the New York Times reports.
  • On a scale from 0 to 120, the Economist’s new index tracks how “normal” we are. “Already, two things are clear: that the last phase of the pandemic will be drawn-out and painful; and that covid-19 will leave behind a different world,” the newspaper reports, noting that its normalcy index reflects both these realities. Taking the pre-pandemic average as 100, the index tracks flights, traffic, shopping, and more across fifty countries which represent 76 percent of the global population. Today, the index for the world stands at 66, which the Economist says is almost double its lowest level achieved in April 2020.
  • US companies are struggling with the return to work. Nearly half of companies are bringing their workforces to a hybrid model, in comparison to the roughly one-third of companies that are adopting an “in person first” employment model, says a survey from CNBC. “Employee health & wellness (84%) and employee productivity (72%) were the most likely to be described as ‘very important’ to work plans, according to the survey. Those were followed by access to talent (58%) and aligning employees with a corporate mission (58%),” adds CNBC.
  • England plans to drop COVID-19 restrictions. UK Prime Minister Boris Johnson announced that he would remove hundreds of pandemic-era regulations starting July 19, making England “the most unrestricted society in Europe,” the Guardian reports. “The so-called ‘big bang’ reopening is expected to go ahead despite warnings that daily cases in England could soar to 50,000 before masks and social distancing are ditched,” the Guardian adds.
  • Globally, mental health has fared better than expected. Three psychology professors were “surprised by how well many people weathered the pandemic’s psychological challenges… People are more resilient than they themselves realize.” They wrote in the Atlantic that “Human beings possess what some researchers call a psychological immune system, a host of cognitive abilities that enable us to make the best of even the worst situation.”

The inside scoop

Insights from the Atlantic Council

Andrew Marshall is the Vice President of Communications for the Atlantic Council. He leads the Council’s media, digital, and editorial efforts, and coordinates the way the Council talks with its key communities.

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Pepe Zhang in Foreign Policy: U.S. Blunts China’s Vaccine Diplomacy in Latin America https://www.atlanticcouncil.org/insight-impact/in-the-news/foreign-policy-us-china-vaccine-diplomacy/ Fri, 09 Jul 2021 14:21:00 +0000 https://www.atlanticcouncil.org/?p=548898 On July 9, 2021, Pepe Zhang was quoted in the Foreign Policy article, "U.S. Blunts China’s Vaccine Diplomacy in Latin America".

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On July 9, 2021, Pepe Zhang was quoted in the Foreign Policy article, “U.S. Blunts China’s Vaccine Diplomacy in Latin America”.

“I don’t look at this as a zero-sum game, but that doesn’t mean the vaccine diplomacy itself doesn’t have geopolitical or foreign-policy implications. If Chinese vaccines are the only available solution in one country, that potentially puts China in a position to pursue additional interests or priorities,” Zhang remarked.

More about our experts

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FAST THINKING: Why the Moïse assassination is Haiti’s worst-case scenario https://www.atlanticcouncil.org/content-series/fastthinking/fast-thinking-haitis-worst-case-scenario-moise-assassination/ Wed, 07 Jul 2021 17:54:44 +0000 https://www.atlanticcouncil.org/?p=412488 The murder leaves a power vacuum atop a country battling rampant crime and COVID-19—with no obvious succession plan in place. What’s going on in Haiti and how will it reverberate across the region?

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JUST IN

It’s a shock to a reeling nation. Haitian President Jovenel Moïse was killed in his home by a group of assailants early Wednesday, with the first lady also seriously injured. The murder leaves a power vacuum atop a country battling rampant crime and COVID-19—with no obvious succession plan in place. What’s going on in Haiti and how will it reverberate across the region? Our experts break down what we know and don’t know.

TODAY’S EXPERT REACTION COURTESY OF

  • Wazim Mowla (@wmowla): Assistant director of the Caribbean Initiative at the Adrienne Arsht Latin America Center

The Moïse file

  • Hours after Moïse’s assassination, the picture of what happened remains “murky,” Jason says. “Reports indicate that the assailants were well-organized and precise with their planning and how they carried out the attack, including the use of sophisticated weaponry.”
  • In office since 2017, Moïse has faced persistent criticism over how he’s governed Haiti—including the accusation that his term already expired, though he’s remained in charge. He’s also pushed for constitutional reforms to strengthen the presidency. “Moïse will likely be remembered as part of a long line of Haitian leaders who struggled to bring economic development and democracy to the country,” Wazim says.
  • The chronically unstable nation was in a fraught position even before the assassination. In addition to the pandemic fallout—with cases rising and the country unable to procure any vaccinesJason points out that “in the first four months of the year, kidnappings rose 36 percent and homicides 17 percent.” Plus, hurricane season is just beginning, and Haiti is often in the path of major Caribbean storms.
  • Given all these mounting problems, Jason calls this morning’s attack Haiti’s “worst-case scenario.”

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A new refugee crisis?

  • Part of the problem is that the country lacks a succession plan: Acting Prime Minister Claude Joseph, who announced Moïse’s death, “has been making statements on behalf of the government today, including declaring a ‘state of siege,’” Jason notes. But “questions remain as to the order of succession given vacant posts currently in the Haitian government.” For example, Moïse selected a new prime minister, Ariel Henry, but Henry has not yet been sworn in. And the head of the country’s highest court just died of COVID-19.
  • Many Haitians may respond by attempting to leave the country. Wazim points to reports that 13,000 people have already fled Haiti due to gang violence since June 1. “More instability can have spillover effects throughout the region, including leading to increased migration across the Caribbean and to US shores,” Wazim tells us. “The situation is likely to worsen, so the Biden administration and Caribbean leaders should start today to prepare to welcome refugees.”

Will the world step up?

  • Haiti’s crisis requires a broad international response, Wazim says. He notes that the Organization of American States (OAS) “has tried to take the lead in recent months” including a three-day visit to Haiti last month with the aim of fostering free and fair elections.
  • But Wazim wants to see more from the Caribbean Community (CARICOM). “The regional body, of which Haiti is a member, can be the most effective and influential actor going forward,” he argues. “Overall, there needs to be a combined and coordinated effort by the OAS, CARICOM, the US, and the UN.”
  • What can all these groups provide? “The country still needs vaccines, it needs to rebuild democratic institutions, and it needs a lifeline for its economic growth,” Jason tells us. “If not, lawlessness will continue to fill the vacuum that has been created.”
  • But Wazim cautions that international actors need to work closely with people on the ground in order to make a lasting difference: “It will be about guidance rather than giving orders to Haiti.”

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How rich countries can help Africa respond to the third wave of COVID-19 https://www.atlanticcouncil.org/blogs/new-atlanticist/how-rich-countries-can-help-africa-respond-to-the-third-wave-of-covid-19/ Wed, 07 Jul 2021 16:52:58 +0000 https://www.atlanticcouncil.org/?p=412404 When the G20 finance ministers and central bank governors meet July 9 and 10 in Venice, Italy, they have an opportunity to respond to Africa's third-wave crisis in a meaningful way. Will they take it?

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Nearly five hundred days after the first COVID-19 lockdowns, which were quickly followed by rich countries flooding the zone with vast spending programs, Africa still awaits comprehensive support from the international community to help offset the pandemic’s economic blows. When the Group of Twenty (G20) finance ministers and central bank governors meet July 9 and 10 in Venice, Italy, they have an opportunity to respond in a meaningful way. Will they take it?

Of course, some financial assistance has flowed, and the International Monetary Fund (IMF) and World Bank deserve commendation for their advocacy and support for Africa at this difficult time. Innovative policies like the IMF’s proposal for allocating $650 billion of special drawing rights (SDRs) to boost countries’ foreign-exchange reserves may help stave off the worst of the crisis for some, but the idea has moved at a sluggish pace. The overwhelming conclusion one must draw is that rich countries are leaving Africa to its own devices during an unprecedented crisis.

Grim data continues to mount from the third wave of COVID-19 spreading across the continent, driven by the Delta variant. The number of daily cases in the region recently passed 41,000, up from this year’s low of around 7,000 in mid-May; the third wave is already worse than those that came and went in July 2020 and January 2021. And there is reason for further concern for Africa, where some countries already face acute shortages of oxygen and emergency beds, as evidence from India suggests that the Delta wave is unsparing across all age groups. Africa now faces the prospect of much of its youthful, working-age population becoming afflicted by the virus.

International action in Africa is urgent, but simply reiterating that message in the face of the pandemic’s rising toll borders on futility. So while the international community has provided strong rhetorical support, actual assistance to Africa falls far short of what is needed. For example, the G20’s Debt Service Suspension Initiative (DSSI), set up in April 2020 to provide breathing room to countries facing heavy repayment obligations, allowed forty-three countries to put off paying an estimated $5.7 billion last year. However, the United Nations Children’s Fund (UNICEF) argued that amount pales by comparison with the more than one hundred billion dollars of debt forgiveness provided under the Multilateral Debt Relief Initiative and the Heavily Indebted Poor Counties Initiative, IMF-World Bank debt-relief programs put in place around the turn of the century. The latter program recently put in motion up to fifty billion dollars of relief to Sudan alone.

The international community needs to ensure that Africa receives assistance commensurate with the nearly $20 trillion in monetary and fiscal expansion that rich countries had committed, as of November, to their own economies during the pandemic. Without fresh financing, the economic divergence between advanced economies that are experiencing a return to growth and struggling low-income countries will only continue to widen.

A fresh start will require a commitment to plug financing gaps across all fronts:

Accelerating vaccines

The World Health Organization-led COVAX cooperative’s plan to distribute COVID-19 vaccines to developing countries and the G7’s proposal to donate one billion doses over the next year falls far short of demand. Africa and the developing world need the shots now, and India’s export restrictions on its vaccine production—originally intended for COVAX—suggest that supply shortages could persist into 2023. The World Trade Organization is considering a proposal to relax intellectual property protections on COVID-19 vaccines—which some regard as global public goods—but there is strong European opposition to that approach. Efforts to manufacture the vaccines in Africa are moving too slowly to address the immediate crisis, so another possible solution is for the Biden administration to expand the scope of the US Defense Production Act to compel pharmaceutical companies like Pfizer, Moderna, and Novavax to step up global distribution.

Pushing debt relief, SDRs, and aid

The IMF and World Bank should push the G7 and the G20 to endorse a comprehensive financial assistance package for Africa and then get the governments to decide how that money can best be used. This includes continuing DSSI at least into 2022, pressing lenders like China to be more transparent about their debt negotiations, and accelerating debt restructuring under the G20’s Common Framework—a snail’s-pace process that revolves around “creditor committees” of bilateral lenders.

Most importantly, it is crucial that the international community quickly approves the IMF’s $650 billion SDR allocation and then redirects one hundred billion dollars of those funds from advanced economies to low-income countries. IMF insiders, who asked to remain anonymous to discuss the state of play, tell us that deliberations on both steps in the process have been handicapped by lack of consensus over how the money will be used once countries receive their SDR apportionments and whether already-heavy debt burdens will increase even more due to shifting funds from high-income to low-income countries. Other proposals to assist heavily indebted countries with IMF funds also remain under discussion.

Involving the private sector

The pandemic hit as many African nations had weaned themselves off of aid dependency and come to rely on access to borrowing from private capital markets. But when the crisis hit and caused many debt loads to become unsustainable, the private lenders failed to participate in the G20’s debt-service moratorium. G20 governments must make a push to bring the private sector into the debt-relief process. Commercial banks and institutional bondholders hold more than 30 percent of Africa’s debt, and so far those creditors have refused to participate in any debt-relief initiative that goes beyond case-by-case negotiations.

Meanwhile, some governments remain hesitant about DSSI out of fear that credit-rating agencies will downgrade their bonds and limit their access to capital markets. The effort to induce voluntary private sector participation in the DSSI and Common Framework has been a failure. This has been underlined in Chad, one of the three countries currently negotiating debt relief with official creditors under the Common Framework, where government lenders are closing in on a restructuring agreement but have done no more than urge private creditors to join the effort.

This process has run its course, and the G20 needs to require that banks and asset managers participate in the debt-relief effort. There are several innovative proposals for addressing the debt issue in ways that free up funding for African countries, notably from the UN Economic Commission for Africa. But governments need to force the issue with private lenders, as they have during previous debt restructurings from South Korea in 1997 to Argentina last year.

A commitment across these three fronts is particularly urgent with the onset of the third wave because of its frightening trajectory across the continent. Africa has already waited long enough: It should not have to wait five hundred more days—or even longer—for the international community to provide comprehensive assistance.

Vasuki Shastry, formerly with the IMF, Monetary Authority of Singapore, and Standard Chartered Bank, is the author of  Has Asia Lost It? Dynamic Past, Turbulent Future. Follow him on Twitter @vshastry.

Jeremy Mark is a senior fellow with the Atlantic Council’s Geoeconomics Center. He previously worked for the IMF and the Asian Wall Street Journal. Follow him on Twitter @JedMark888.

Further reading

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How Aleksandar Vučić stole the vaccine-diplomacy show https://www.atlanticcouncil.org/blogs/new-atlanticist/how-aleksandar-vucic-stole-the-vaccine-diplomacy-show/ Wed, 30 Jun 2021 23:35:45 +0000 https://www.atlanticcouncil.org/?p=410908 By balancing the West, Russia, and China, Serbian authorities have made impressive headway in inoculating their citizens—and using vaccines as a diplomatic tool.

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Eleven days after COVID-19 was declared a global pandemic, TV audiences in Serbia were treated to an extraordinary sight. The country’s president, Aleksandar Vučić, kissed the Chinese national flag as medical equipment, personal protective equipment (PPE), and Chinese medical staff landed in Belgrade on March 22, 2020. Overnight, billboards sprang up across the Serbian capital featuring China’s president and the caption “Thank you, brother Xi.”

What appeared to be a prime example of Chinese COVID-19 diplomacy was built on thriving economic and diplomatic ties between Beijing and Belgrade, a true pillar within China’s 17+1 initiative in Central and Eastern Europe along with the Balkans. After the medical transport, China funded a network of laboratories to carry out coronavirus tests. In mid-January another plane delivered a batch of one million doses of China’s Sinopharm vaccine. Vučić turned up at the airport again to bask in the glory of the moment.

Half a year later, the narrative has changed. It is no longer about China boxing out the West in the Balkans but Serbia’s ability to punch above its weight. Serbian authorities have made impressive headway in inoculating their citizens—and using vaccines as a diplomatic tool:

  • In a country with a population of just over seven million, 5.15 million doses have been administered. More than 2.4 million people—over one-third of Serbian citizens—have received two jabs.
  • Serbia has donated vaccines to neighbors such as Montenegro, North Macedonia, and Bosnia and Herzegovina (to Republika Srpska, the Serb-majority entity).
  • People from neighboring countries have been able to register and get jabs while visiting Serbia.

In short, Belgrade seized the momentum at a juncture when the World Health Organization-led COVAX cooperative program proved woefully slow to procure vaccines and European Union member states were busy taking care of their own citizens.

Arsenal of vaccines

China is part of Serbia’s success but not the full story. Sinopharm’s rollout, starting in January 2021, added to Belgrade’s arsenal of vaccines. Vučić got the Chinese jab in front of TV cameras in a remote village in eastern Serbia. The government floated plans for producing Sinopharm locally in partnership with the United Arab Emirates.

Serbia did not, however, put all its eggs in one basket. In fact, Serbia had already received its first Pfizer vaccine shipment in December 2020, and Prime Minister Ana Brnabić got the jab then—well ahead of most other European leaders. Russia’s Sputnik V vaccine arrived in January; later, in early June, the Belgrade-based Torlak Institute became the first facility outside the Russian Federation to produce it. Serbia’s AstraZeneca vaccine shipment arrived in February. Serbia took vaccines from all sources—China, Russia, and Western companies—and made the most of the stocks it accumulated.

This response to COVID-19 provides a second-to-none illustration of Serbian foreign policy. Vučić is not interested in siding with either China or the West, especially as the power competition between Beijing and Washington ratchets up. He believes Serbia’s interests, and his personal agenda, are best served by being open to business with everyone. The posture reflects Belgrade’s long-standing balancing act between the EU and the United States on the one hand, and Russia on the other. “Sit[ting] on two chairs” is how US diplomat Brian Hoyt Yee described Serbia in 2017.

The power of flexibility

In Serbia’s case, its vaccine diplomacy proves flexibility works. Serbia has fared much better in vaccinating its citizens than its pro-Western neighbors such as North Macedonia and Montenegro, both NATO members. Vučić has won plaudits across the region too.

Chances are he will do even more of these multivector acrobatics in the future, whether playing rival powers off each other or selling to the highest bidder. Eventually, Vučić will take full credit for the EU economic assistance earmarked for Serbia, while his loyal media will continue to sing Xi Jinping’s praises. Titoism has never gone out of fashion in this corner of Europe. 

While China’s vaccine and PPE diplomacy scored some points in the Balkans, it is local players like Serbia’s Vučić who absolutely stole the show.

Dimitar Bechev is a nonresident senior fellow with the Atlantic Council’s Europe CenterFollow him on Twitter @DimitarBechev.

Further reading

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The strategic importance of sending US vaccines to the Caribbean https://www.atlanticcouncil.org/in-depth-research-reports/issue-brief/the-strategic-importance-of-sending-us-vaccines-to-the-caribbean/ Mon, 28 Jun 2021 16:30:00 +0000 https://www.atlanticcouncil.org/?p=407480 While the COVID-19 pandemic has created challenges across the world, it is having a disproportionate impact on countries in our hemisphere.

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Foreword

While the COVID-19 pandemic has created challenges across the world, it is having a disproportionate impact on countries in our hemisphere. Just over a month ago, the death toll in the Latin America and the Caribbean (LAC) region passed one million—the region, as of that moment, had the highest per capita death rate in the world. In May, although home to just over 8 percent of the world’s population, the LAC region suffered 31 percent of its COVID-19 casualties. US vaccine assistance has prioritized our hemisphere on balance with other parts of the world. But this policy brief makes the case that even greater assistance is needed for the Americas with a laser focus on the particular support required by our Caribbean neighbors.

The challenges facing members of the Caribbean Community (CARICOM) are often underreported even as some, such as Trinidad and Tobago, Guyana, Suriname, and Saint Kitts and Nevis, have had higher COVID-19 infections per 100,000 people than almost anywhere in the world, including other hot spots, like India. At the same time, CARICOM members have struggled to acquire vaccines, instead relying on actors such as China, Russia, India, and the African Union.

As the United States makes more vaccines available, greater CARICOM vaccine assistance would serve both Caribbean and US domestic and geopolitical interests. Vaccine donations to the Caribbean are critical to build on the United States’ historic friendship with its CARICOM partners. Vaccines are integral not just to the health of the Caribbean but also, given the close personal linkages, to US health. And since the Caribbean is intrinsically linked to the United States, to help them is to help ourselves.

This policy brief, which takes into account conversations we had with key stakeholders at a private roundtable in May, highlights the health, economic, and strategic reasons for greater vaccine access for CARICOM members. This brief and the events that preceded it, including our broader work raising awareness of how the United States can support the LAC region at this historic time of great need, goes to the heart of our mission at the Adrienne Arsht Latin America Center: to elevate and advance the importance of the LAC region in the world community and to build even stronger US ties with the region.

It is for this reason that we established the center’s Caribbean Initiative earlier this year. We aim to raise Caribbean priorities across the globe, with a particular focus on strengthening the US-Caribbean partnership. We understand that the challenges of our time are hemispheric and sometimes global in scope. But all too often, when we think about hemispheric solutions, CARICOM member states are the missing, overlooked piece of the puzzle. With this policy brief, we are shining a spotlight on the Caribbean’s vaccine needs and the linkages with US domestic interests. We are elevating this critical issue to save lives and livelihoods. This is why I am pleased that this is the first publication of our new Caribbean Initiative.

Jason Marczak
Director, Adrienne Arsht Latin America Center
Atlantic Council

Introduction

Even as the United States rebounds from the COVID-19 pandemic, its Caribbean neighbors are at a critical and worsening moment. Rising infections due to new variants of the virus and limited access to vaccines have elongated the already devasting effects of the pandemic.

COVID-19 will continue to claim lives, stifle economic recovery, and lead to greater security challenges in the Caribbean for the foreseeable future. Ties between the United States and Caribbean nations mean that continued pandemic surges in the Caribbean are likely to affect US national security, the health of US citizens, the United States and specifically Florida’s economic recovery, and US foreign policy priorities. What happens in the Caribbean is unlikely to stay in the Caribbean. That is why US strategic interests and broader hemispheric security and prosperity depend on the United States further assisting its Caribbean partners in their efforts to secure COVID-19 vaccines.

While the COVID-19 pandemic has affected much of the world, it has had a disproportionate impact on members of the Caribbean Community (CARICOM)—a fifteen-member regional group that consists of Small Island Developing States (SIDS) who make up more than one-third of the Western Hemisphere’s states.1 Small size, limited resources, and tourism-dependent economies have resulted in stunted growth and an inability of Caribbean nations to acquire the requisite COVID-19 vaccines. 

The United States and the Caribbean region have historically enjoyed close ties based on shared interests and values, making the two part of a mutually beneficial partnership. The US-Caribbean relationship is tied by a number of factors, including geography, with Caribbean states in close proximity to the United States, leading US officials to describe the region as a “third border.”2 When global and regional events, such as the COVID-19 pandemic, economic recessions, or natural disasters reach the United States or the Caribbean, neither is spared from the consequences. 

This overarching relationship is one reason why it is imperative that the Biden administration support the Caribbean region’s states in their efforts to acquire COVID-19 vaccines. Another reason more vaccines should be made available to the Caribbean, while simultaneously accelerating the prioritization of distribution to the broader hemisphere, is the need to protect the livelihoods of the American people.

The Caribbean economies, especially those that are tourism-dependent, are connected to the tourism economies of cities in southeastern United States, such as Miami and Orlando. This means that recovery for these economies in the United States might not reach pre-pandemic levels if a key source of growth—Caribbean nations—are unable to reopen their borders and accelerate economic recovery. In addition, as COVID-19 virus variants materialize and are transmitted throughout the region, US populations can be put at risk since the Caribbean is a popular destination for US tourists.

Beyond domestic considerations, geopolitical and security implications are also at play if the United States does not step up its vaccine support for the Caribbean nations. Since the onset of the pandemic, medical diplomacy has increased globally. Caribbean countries have been beneficiaries of this diplomacy, first with donations of personal protective equipment (PPE) and medical personnel and now with donations and purchasing agreements for COVID-19 vaccines. China, India, Cuba, Russia, and the African Union (AU) have all supplied medical equipment and/or vaccines to the region and have used these donations to build goodwill with Caribbean governments and people.

On the security front, cash-strapped Caribbean governments, unable to provide public goods and access to social services amid rising rates of poverty and unemployment, can present challenges for the Caribbean and, by extension, the United States. For instance, rising poverty and unemployment benefits the membership of gangs and organized crime. Fiscal challenges can also contribute to social unrest and questioning of government legitimacy. Criminal groups that operate in the Caribbean are transnational in scope, particularly due to the porous borders of the states in the region, meaning that illicit activities can impact US national security. The instability that arises from the pandemic’s consequences can also increase legal and illegal flows of migrants to the United States.

The announcement by the Biden administration that it will deliver vaccines to CARICOM nations via the COVID-19 Vaccines Global Access (COVAX) Facility is a welcome initiative,3 but it is one that barely scratches the surface. Although there was an additional announcement of 500 million vaccine donations,4 the Caribbean, with interests balanced alongside those of other hemispheric countries, must remain top in line to receive vaccines immediately through bilateral channels. At the same time, the United States should donate equipment that will help with the dissemination of vaccines, such as ultra-cold temperature vaccine freezers and medical equipment. Further, the United States should help Caribbean nations in their efforts to purchase vaccines from US manufacturers and, when vaccines are delivered, organize a media campaign in the region to build and strengthen goodwill among Caribbean citizens. 

The ideas presented in this issue brief are part of the Caribbean Initiative’s Strategy Document Series and a larger effort to inform and publicize the strategic importance for the United States of helping CARICOM members acquire vaccines. Many of the ideas presented here are the result of a private roundtable with US and Caribbean experts (see Acknowledgements section) from the private sector, public sector, academia, government, and regional and multilateral institutions, all of whom came together to discuss why the United States should help the Caribbean region in its efforts to secure vaccines. 

Overview of the current economic and health situation in the Caribbean

Although the COVID-19 pandemic has affected much of the world, it is having a disproportionate impact on the Caribbean region, in particular, CARICOM member states. Rising infections have forced states to close borders and governments to inject monetary resources to curb the pandemic’s consequences. For CARICOM, the pandemic has been particularly devasting. The open economies in the Caribbean are highly dependent on tourism, vulnerable to global economic shocks, have incurred large amounts of debt, and many do not qualify for concessional financing from international financial institutions. A combination of these vulnerabilities has made the Caribbean one of the most at-risk regions in the world.5

A worsening economic crisis

In 2020, most Caribbean countries were forced to close their borders to curb the spread of COVID-19 infections, resulting in a halt in economic activity for key sectors, such as tourism and trade. This led to an economic contraction of an estimated 8.6 percent for the entire region (an estimated 12.6 percent excluding Guyana).6 The reduction in tourism resulted in heightened unemployment, further damaging the livelihoods of Caribbean people, especially in states such as Antigua and Barbuda (44.7 percent of employment is tourism dependent in 2019), Barbados (36.4 percent), Saint Kitts and Nevis (60.2 percent), and Jamaica (31.5 percent).7

Closed borders and limited air travel have been particularly detrimental for a region in which a majority of states are tourism-dependent economies. According to the Inter-American Development Bank’s Tourism Dependency Index, ten of the fourteen independent members of CARICOM rank in the top twenty of most tourism-dependent states.8 This meant that the 67 percent contraction of international arrivals to the Caribbean in 2020 devastated economies, with a particular effect on micro, small and medium-sized enterprises (MSMEs).9 These enterprises account for 99 percent of all businesses in the Latin America and Caribbean region.10 In addition to the pandemic’s current impact on MSMEs, it also has the potential to disrupt the reemergence of these enterprises since they will not have access to requisite finances needed to reopen for business and rehire employees. 

The economic contraction that has resulted from the pandemic is coupled with high levels of debt. Prior to the pandemic, the Caribbean, along with Latin America overall, was considered the most indebted region in the world, with debt expected to rise from 68.9 percent in 2019 to 79.3 percent of GDP in 2020.11 For Caribbean states, which have incurred more debt than their Latin American neighbors, this has placed constraints on their ability to borrow more money while also remaining limited in the ability to service existing debts due to little economic growth. 

The precarious economic situation in the Caribbean is likely to affect the region’s relations with the United States. Prolonged economic contraction and job loss in the region can decrease travel to the United States as well as Caribbean demand for US goods, which can harm US-Caribbean trade relations. Further, high levels of debt for Caribbean countries will mean that they are likely to seek financial support from other countries, such as China, in order to service debts and address citizens’ immediate needs. Finally, if the region cannot reopen its borders to restart tourism industries, Caribbean states will incur additional financial loss over a longer period, meaning that the economic consequences of the pandemic to the US-Caribbean relationship can extend beyond 2021 and 2022. 

Shoppers line up at a supermarket ahead of a 24-hour curfew in St Michael, Barbados, April 3, 2020. REUTERS/Nigel Browne

Infections continue to rise due to new virus variants

At the onset of the pandemic, Caribbean countries were spared rising rates of infections since they closed their borders as early as March 2020. However, an indefinite lockdown was unrealistic due to the region’s dependence on the international system for its economic health. Caribbean countries were forced to gradually reopen their borders, and with this came multiple waves of infections, particularly as new variants of the coronavirus that causes COVID-19 emerged and were transmitted by migrating populations. 

Trinidad and Tobago, which reported that the virus variant first detected in Brazil had entered the country from Venezuela, saw infections climb from forty-four a day at the beginning of April to 558 on May 20.12 Trinidad and Tobago entered its third state of emergency on May 15.13 In the case of Guyana, which has a porous border with Brazil, the daily infection rate climbed from thirty-one cases a day as of early April to 136 cases by May 20.14 Since Guyana shares a border with Suriname, where there are frequent occurrences of illegal crossings, it is likely that the Brazil variant will soon reach Suriname, which would explain the rise in infections in Suriname from ten per day on April 4 to 300 on June 2.15 Lax restrictions coupled with limited testing could result in a rapid increase in infections, similar to the case of Trinidad and Tobago, which is experiencing more cases per capita than other pandemic epicenters, such as India. 

If infections rise, Caribbean countries will be forced to close borders or not reopen them in the near future, which will have an economic and geopolitical impact on the United States. Closed borders result in economic contraction, which disrupts demand for US goods and deters Caribbean citizens from traveling to the United States. 

The Caribbean’s vaccine dilemma

The economic and health crisis caused by the pandemic is threatening to amplify existing vulnerabilities in the Caribbean, such as growing debt and revenue loss in key economic sectors, even as the region braces for hurricane season. The region is in desperate need of COVID-19 vaccines. Vaccine donations and rapid inoculation is imperative. In comparison to other affected regions, the Caribbean must grapple with both the pandemic as well as an active hurricane season. According to the National Oceanic and Atmospheric Administration, there is a 60 percent chance that there will be an above average hurricane season this year—this could potentially further reduce the number of tourists traveling to the region.16 The Atlantic hurricane season runs from June 1 through November 30. 

If they cannot quickly vaccinate their populations and reopen borders, Caribbean countries will not have enough time to recover lost growth and resources vital to repair the damage caused by strong tropical storms and/or hurricanes. Although, relative to previous years, the region was spared during the 2020 hurricane season, the combination of rising infections and a natural disaster will delay economic recovery and vaccination efforts. An early sign of this was the recent volcanic eruption in Saint Vincent and the Grenadines, which forced the government to pause its vaccination efforts in order to attend to displaced persons and address damage caused to agriculture and infrastructure.17

At the moment, the Caribbean region has been unable to secure the requisite number of vaccines which would allow the countries to reopen their borders and accelerate post-pandemic recovery, particularly in larger Caribbean states such as Jamaica and Trinidad and Tobago. Smaller Caribbean islands, like those in the Eastern Caribbean, although with small populations, have been unable to inoculate their populations due to limited vaccines access. While the Caribbean nations have received vaccines via donations and purchasing agreements, as well as through the COVAX Facility, these avenues, thus far, have been inefficient. The COVAX Facility has provided one hundred and ten thousand vaccines to Jamaica,18 sixty-seven thousand to Barbados,19 sixty-seven thousand to Trinidad and Tobago,20 sixty-two thousand to Guyana,21 forty-five thousand six hundred to Grenada,22 and twenty-four thousand each to Antigua and Barbuda23 and Saint Vincent and the Grenadines.24 Vaccines from the COVAX Facility do not cover the entire population of each country and are disseminated in batches spread over a longer period. 

Since the COVAX Facility has delivered few vaccines thus far and is expected not to deliver its full quota until 2022 or 2023, even with US donations to the facility, Caribbean governments have sought vaccines from China, India, Russia, and the AU. China has donated a total of three hundred and eighty thousand vaccines to its diplomatic allies in the Caribbean, India promised a total of five hundred and seventy thousand vaccines to the entire region, Russia is supplying two hundred thousand to Guyana through a purchasing agreement, and the AU has set aside 1.5 million vaccines for CARICOM via a brokered agreement between the two regional groups in 2020.25 However, even though some countries, such as India, have promised vaccines to the region and others, like Russia and the AU, have reached purchasing agreements, these agreements do not immediately result in vaccine delivery. The two hundred thousand vaccines Guyana purchased from Russia will reach it in batches, and the 1.5 million vaccines brokered for CARICOM from the AU have yet to be delivered. 

Importance of vaccinating the Caribbean for the United States

As much as the United States is critical to the financial health of the Caribbean, so is the Caribbean for the United States. It is a mutual relationship, where in addition to the United States benefiting from a significant trade surplus, it is a provider of tourists, is home to a large Caribbean diaspora, and is a space where many Caribbean skilled workers travel in search of jobs. 

Beyond the economic linkages, migration between the Caribbean and the United States is consistent. The US-based Caribbean diaspora attracts visits from family members in the region and the Caribbean is a frequent destination for US tourists. However, in order for travel from Caribbean islands to the United States to occur, Caribbean citizens will first need to be vaccinated. Since many are not, it is unlikely that they will travel to the United States anytime soon, which means that hotels, restaurants, and shopping centers will not benefit from these visitors, thus reducing the growth potential for US local economies. 

As noted, the United States benefits from its trade relationship with Latin America and the Caribbean. In 2018, the State Department said that the United States “is the primary trading partner for the Caribbean” with a $12.3 billion trade surplus.26 The relationship, while presented as one-sided given the large surplus enjoyed by the United States, is mutually beneficial since the Caribbean is almost as important to the United States as the United States is to the region. The Caribbean is the United States’ sixth-largest trading partner. Although the region’s economic impact is not as profound as that of other top US partners, such as Mexico and China, the Caribbean is a significant part of the US economy and vital to its economic growth.27

Low rates of vaccination in the region have a broader impact on US trade with the region. Since the Caribbean consists mainly of MSMEs, where even larger firms are considered small and medium-sized enterprises (SMEs), these enterprises’ ability to produce goods for the US market is likely to have declined. At the same time, since many SMEs are not operational due to the pandemic, there is less chance that they will purchase US goods, especially since imported US goods are used to accommodate the preferences of US tourists in the region. In other words, closed economies and a reduction in key economic sectors have deprived Caribbean governments and citizens of financial resources, which has reduced the supply of exports to the United States and the demand for US goods in the region. 

Florida-Caribbean economic linkages

Decreased US-CARICOM trade has implications for southeastern United States, Florida, in particular, which accounts for about 30.4 percent of total US trade with Latin America and the Caribbean.28 Of this percentage, the Caribbean represents 38.9 percent of total US trade, meaning that for Florida, more than a third of its trade is dependent on its connection to the Caribbean.29 

For Florida and the companies that operate out of the state, such as cruise lines and other sectors of the tourism industry, it is imperative that the Caribbean and its citizens be vaccinated in order to reopen borders and restart economic activity. If cruise ships, which are an integral link in the Florida-Caribbean economic relationship, do not have destinations for tourists to visit, then these companies will have limited options. Limited options for tourists can deter people from buying cruise tickets and harm additional industries, such as airlines and US-led hotel chains on the Caribbean islands. 

Citizens start to mingle near the bars and restaurants without masks as curfews are lifted in Miami, Florida, U.S., March 26, 2021. REUTERS/Yana Paskova

For Florida, which is a home port for many cruise lines, there are direct and indirect consequences for its economy. For instance, Royal Caribbean, which is one of the biggest cruise companies that has home ports in Florida, has seen contractions of its revenue due to lower levels of tourism. This has resulted in a loss of employment for many residents in Miami, where almost 79,000 jobs are attributed to the cruise industry, including those at ports, retail, and manufacturers, among others.30

The reasoning behind cruise lines and Florida’s economic contraction and the corresponding rise in unemployment is that Caribbean borders have had to close each time the number of COVID-19 infections goes up. The numerous waves of infections and constant closing and reopening of borders, as well as Centers for Disease Control and Prevention (CDC) categorization of Caribbean islands as high-risk states, has decreased the confidence of prospective tourists. For instance, the CDC recommends that US citizens not travel to states that are classified at level 4 (high risk), as was the case for Trinidad and Tobago and Jamaica as of June 7.31

At the same time, limited tourism due to closed Caribbean borders will prevent Caribbean residents from traveling to the United States for jobs or to visit members of the Caribbean diaspora—both of which are drivers of economic and job growth. When family members visit the United States, they often stay for an extended period of time, which usually includes hotel stays, shopping at local stores, and eating at restaurants, all of which are vital to local economies and particularly small businesses. In 2019, almost two million people from the Caribbean visited the United States.32 Large cities that have high concentrations of the Caribbean diaspora, such as Fort Lauderdale, Orlando, and, outside Florida, New York City, would benefit from reopened Caribbean borders. 

Geopolitical importance of the Caribbean to the United States

As the United States aims to strengthen partnerships in the Caribbean, extra-hemispheric vaccine diplomacy and potential rises in instability and illicit activity will add to local vulnerabilities and complicate its ability to advance its interests and partnerships with Caribbean allies. Therefore, US President Joseph R. Biden, Jr., and his administration should use vaccine donations to compliment the goodwill they built in the first half of 2021, such as US Secretary of State Antony Blinken’s virtual roundtable with CARICOM foreign ministers on April 2133 and US National Security Advisor Jake Sullivan’s call with CARICOM Secretary General Irwin LaRocque and leaders from the CARICOM member states on May 7.34

Vaccine diplomacy in the Caribbean

The United States committed COVID-19 vaccines to the Caribbean with the June 3, 2021, announcement that CARICOM will receive a portion of the six million vaccines designated for Latin America and the Caribbean through the COVAX Facility. More vaccines are urgently needed and additional actors have filled the gap. Through either purchasing agreements or donations, CARICOM states have received almost one million two-shot vaccines from China, Russia, and India, with 1.5 million Johnson & Johnson vaccines expected to arrive from the AU. In addition, as Cuban-made vaccines earn approval from the World Health Organization (WHO), the Caribbean is likely to benefit from donations or low-cost purchasing from its neighbor. 

Compared to Latin America, China has not given a substantial number of vaccines to Caribbean governments, but a recent loan from China to Trinidad and Tobago might be a blueprint for future interactions between China and its Caribbean allies. As small states with limited economic resources, Caribbean countries are pragmatic actors whose outreach to richer nations, such as the United States and China, is dependent on the needs of their citizens rather than ideological influences. As a result, many countries’ leaders, including Trinidad and Tobago’s prime minister, Keith Rowley, sought the support of China, as well as the United States, with regard to vaccine acquisition. In this case, China was first to answer the call. 

In early May 2021, Trinidad and Tobago entered a loan agreement with China—the Caribbean nation borrowed €170 million ($204 million).35 As part of the arrangement, China stipulated that 15 percent of the money must be used to purchase Chinese goods and services, which includes the COVID-19 vaccine produced by the Chinese state-owned enterprise Sinopharm. In addition to this agreement, China announced at the end of March 2021 that it would donate up to 100,000 Sinopharm vaccines, all of which arrived in Trinidad and Tobago a few days before the loan agreement was announced.36 As a part of the loan agreement signed between the two countries, Trinidad and Tobago purchased and received 200,000 additional Sinopharm vaccines in June 2021,37 which arrived on the same day that Trinidad and Tobago’s government announced that it received 400 doses of the Pfizer vaccines from the United States.38

Chinese engagement was not an ad hoc event. China’s vaccine diplomacy with the Caribbean has entailed more than the arrival of vaccines; it has also included numerous conversations between Chinese President Xi Jinping and the region’s heads of state and government, including the presidents and/or prime ministers of Barbados, Guyana, Suriname, and Dominica. In all cases, excluding Suriname, China donated Sinopharm vaccines, with Barbados receiving thirty thousand,39 Guyana getting twenty thousand,40 and Dominica an undisclosed amount.41 In addition to these CARICOM states, China has committed more than eight million vaccines to the Dominican Republic.42

A health worker holds a vial with doses of the Oxford-AstraZeneca vaccine, marketed by the Seerum Institute of India (SII) as COVISHIELD, against the coronavirus disease (COVID-19), in Paramaribo, Suriname, February 23, 2021. REUTERS/Ranu Abhelakh

Beyond China, other actors, such as India and Russia, either through donations or purchasing agreements, have provided vaccines to the Caribbean. India was the first country to donate vaccines to the region. Its Ministry of Foreign Affairs announced in February 2021 a plan (later halted due to India’s own rising infection rate) to supply CARICOM nations, including the Dominican Republic and Cuba, with at least five hundred and seventy thousand of its Indian-made AstraZeneca vaccines.43 Russia has been less influential. Only a few Caribbean states have received Russia’s vaccine, mostly because the Sputnik V vaccine has not been made available for donation to the region and is only available for purchase. Guyana purchased two hundred thousand Sputnik V vaccines.44 While neither India nor Russia have pronounced investments or operations in the Caribbean, the donation or selling of vaccines can build goodwill and/or can lead to additional engagements with the region’s governments, in terms of trade and commerce and investments in key economic sectors, such oil, gas, and additional natural resources. This was most recently seen in a treaty signed between the governments of Antigua and Barbuda and Russia,45 which was preceded by a donation of the Sputnik V vaccine.46

Finally, if Cuba’s vaccine receives approval from the WHO, most CARICOM members, which annually announce their support for their Caribbean ally at multilateral institutions, are likely to receive donations or buy vaccines from Cuba. There is precedent for this during the pandemic, particularly at its onset, when Cuba sent multiple medical brigades to Caribbean countries to help strengthen their public health systems.47 Cuba’s support to the Caribbean countries was condemned by some members of the US Congress, who frame this support as future Cuban leverage in the Caribbean.48 

Complicating the image of the United States in the Caribbean

While Caribbean partners, including US allies such as Canada, which has pledged $40 million to Latin America and the Caribbean, have supplied vaccines or support to the region, the United States is often cited for its need for further action.49 The May 2021 US donation of two field hospitals to Trinidad and Tobago to aid in the third wave of infections and high-level meetings between US and Caribbean government officials have not gone unnoticed, but they do not receive the same publicity as a Chinese vaccine donation or purchasing agreement. The longer the United States takes to donate substantial, game-changing vaccines to the region, the greater the risk that Caribbean citizens will develop a negative perception of the role it played in their time of need. This perception would have geopolitical implications, in particular as the United States prioritizes addressing climate change, outcompeting China, and re-embracing multilateralism. 

  • Climate change: In many ways, the effects of climate change and the methods of addressing it are similar to the pandemic. Both cause economic contraction, particularly for tourism-dependent Caribbean countries, and both require solutions that involve a whole-of-government and multilateral approach. As a result, Caribbean countries will view Biden’s approach to supporting partner nations during the pandemic as an example of how his administration might work to address the climate crisis. 
  • Outcompeting China: While the number of vaccines China has sent to the Caribbean is small, the delivery of these vaccines has an impact on the region’s populations. Vaccine arrival is a televised media event that usually makes local and regional news. High-level Caribbean government officials attend the handover ceremony organized by the local Chinese embassy. This means that when it comes to public perception, specifically related to the pandemic, China has gained more ground than the United States. China can use this advantage to further build its domestic political capital.
  • Re-embracing multilateralism: Although Caribbean countries are small in size, their regional body, CARICOM, has fourteen votes in multilateral organizations. In organizations such as the United Nations and regional ones, such as the Organization of American States (OAS), CARICOM votes carry significant weight. Other countries are aware of CARICOM’s importance in these organizations. When Ireland and Canada sought seats on the UN Security Council, high-level government officials traveled to the Caribbean in an effort to secure CARICOM votes.  If the United States provides a significant number of vaccines to the region, while it will not guarantee support at these organizations, it will make countries more inclined to listen and potentially compromise with US positions. In the best-case scenario, the United States and CARICOM could work together, as partners, to push key resolutions on climate change and security in smaller organizations such as the OAS. 

Case study: When China donated its Sinopharm vaccines to Dominica and Guyana, each shipment received substantial media coverage and included official handover ceremonies between Caribbean and Chinese government officials. When China’s vaccines arrived in Guyana in March 2021, Guyana’s minister of health, Frank Anthony, and China’s charge d’affaires to Guyana, Chen Xilai, met at the airport to welcome the shipment.50 At the airport, both representatives offered brief remarks about the importance of the relationship between their two countries. Similar to Guyana, China’s vaccine donation to Dominica was greeted with publicity, including a handover ceremony. The Chinese charge d’affaires to Dominica, Luo Songtao, posed for photographs with Dominica’s prime minister, Roosevelt Skerrit, as they held a box of the Sinopharm vaccines. Coverage of the event included a photo of a Dominican official receiving the first jab of the vaccine.51  

Preventing instability and illicit activity  

An additional implication of the COVID-19 pandemic in the Caribbean is the risk of instability and illicit activity that can arise as the region’s economic situation worsens. This is of particular concern for the United States due to its proximity to the region. Increases in instability and the membership of transnational criminal organizations can lead to forced migration as well as upticks in drug and human trafficking. The risk of instability and illicit activity is not a direct cause of the pandemic but instead an indirect cause that results from limited government resources, widening inequality, and increases in crime and unemployment. In essence, the pandemic should be viewed as an amplifier or aggravator of existing stressors, with the potential to create new ones. Limited economic resources mean that governments will have less resources to invest in the public health sector and labor market if more funding is needed to strengthen security forces in a scenario of increased instability, crime, and/or violence. 

Recommendations

Donations: The Biden administration will distribute eighty million vaccines by the end of June 2021, and while the Caribbean is part of this distribution, it will be imperative to look beyond this initial batch of indirect global donations. As the United States shares 500 million vaccines globally by the late 2021 via the COVAX Facility, the Caribbean, in balancing the broader needs of the hemisphere, should be a top priority for bilateral distribution. Due to the small populations of Caribbean states—the population of the English-speaking states hovers just over seven million people—a small donation of vaccines goes a long way. If the United States were to directly donate at least four million two-shot vaccines, it would cover two million people, or more than a fourth of the region’s English-speaking population. Vaccines for countries directly linked to the tourism industry would benefit US businesses as well. 

  • US distribution of vaccines to the region should involve continued coordination with the Caribbean Public Health Agency (CARPHA), which could help ensure that the supply is distributed equitably. This would ensure that the United States is not accused of choosing beneficiaries. This strategy is a diplomatic advantage that the United States holds over China since only the United States has diplomatic relations with all CARICOM countries. 
  • When sending vaccines to the region, the United States must ensure that CARICOM countries are provided with the appropriate equipment that allows for equitable and efficient vaccine distribution. This means that along with the AstraZeneca vaccines, the United States should bilaterally donate ultra-cold temperature vaccine freezers to CARICOM members to support and strengthen governments’ cold chain systems. 
  • Finally, the United States should deploy other forms of medical diplomacy to Caribbean countries that are seeing rising infection rates. This should include more donations of field hospitals, PPE, and rapid testing kits. Such donations will help Caribbean countries that are awaiting vaccines to avoid additional lockdowns, mitigate rising infections, and support hospitals that are close to full capacity. Already, the United States has donated field hospitals, generators, hospital beds, medical teams, and hand-held thermometers.52 More should be done. 

Purchasing agreements: The small size of Caribbean populations, and, therefore, small relative orders, has contributed to challenges in purchasing vaccines from manufacturers such as Pfizer-BioNTech, Moderna, and Janssen/J&J. The US government can serve as a key interlocutor for Caribbean countries to find solutions to this problem. In addition, the US government can find opportunities to facilitate agreements with the vaccine manufacturers that allow for Caribbean governments and even US private sector members invested in the Caribbean to purchase vaccines at an affordable rate. 

Diplomacy: To build on recent high-level engagements between US and CARICOM government officials, the Biden administration should work with the public diplomacy officers and US ambassadors in US embassies to ensure that the donation of vaccines is part of a larger media campaign. This would build goodwill among Caribbean citizens by advancing messaging with the public on US involvement to help defeat the virus in the region. This form of diplomacy at the local level would build on existing US-led initiatives such as electoral reform, combatting narco-trafficking, and promoting US investment. At the same time, since Caribbean governments have faced challenges to educate and incentivize their citizens to trust COVID-19 vaccines, US embassies can aid their efforts to encourage their populations to get vaccinated.

Conclusion

The United States has the economic and political resources to provide the Caribbean with the support needed to change its COVID-19 trajectory. Timely bilateral vaccine and medical donations to CARICOM would have an immediate impact on Caribbean economies and livelihoods, would strengthen US-Caribbean relations, and would have positive consequences for US economic and geopolitical interests.  

The United States has an opportunity to cement its position as CARICOM’s most trusted ally. The US commitment of at least 580 million vaccines to the COVAX Facility is a step in the direction, but more emphasis must be placed on bilateral donations. If the United States is seen as contributor to re-opening economies via substantial vaccine donations, the perception of the Biden administration is likely to increase. This can make Caribbean governments more favorable to current and future US initiatives. At a broader level, vaccine and medical donations can assist US geopolitical strategies, as it can reduce the likelihood for instability and will help compete with Chinese and Russian engagement.

Sending US vaccines to the Caribbean is in the best interest of the hemisphere. The Caribbean is at a disadvantage in terms of mitigating the effects of the pandemic and acquiring vaccines. Support from the United States can help the Caribbean level the playing field. Doing so can usher in a renewed sense of optimism within the US-Caribbean dynamic. Simply, helping the Caribbean is helping the United States, as the two, through geography, shared values and interests, and frequent travel, are intrinsically bonded together.

Acknowledgments

This issue brief benefited from the insights and expertise of a Caribbean Initiative private roundtable in May 2021, which consisted of participants from the US and Caribbean policy and business communities, including: Ambassador Riyad Insanally, Marla Dukharan, Gervase Warner, Therese Turner-Jones, Timothy Johnston, and Dr. Ivelaw Griffith. We thank the many participants of that strategy session. 

As well, we would like to thank Adrienne Arsht Latin America Center Director Jason Marczak for his leadership and guidance in the drafting of this issue brief and for his prioritization on how to help accelerate vaccine access. In addition, the Atlantic Council thanks Board Member Melanie Chen for her steadfast focus on accelerating US-Caribbean ties and for her broader support of the Caribbean Initiative. 

About the authors

Ambassador James Brewster is currently a Managing Partner at Patino, Brewster & Partners and the CEO of Insignias Global. Most recently, he served as the United States Ambassador to the Dominican Republic, and his appointment made history when he became the first openly gay Ambassador to serve the United States in the Western Hemisphere alongside his husband, Author Bob J. Satawake. As an expert in Latin America and the Caribbean business and political communities, Ambassador Brewster had a positive and significant impact on trade between the U.S. and countries in the Western Hemisphere. His knowledge of NAFTA, CAFTA, HELP and HOPE in addition to Foreign Corrupt Practices Act and trade policy has made the Ambassador a top resource for international companies and leaders of foreign governments.

Wazim Mowla is the Assistant Director for the Caribbean Initiative at the Adrienne Arsht Latin America Center. Mowla holds an MA in History from Florida International University, where he is currently a Non-Resident Scholar for the Jack D. Gordon Institute for Public Policy. He is also an MA candidate at American University’s School of International Service and is honored to have interned for Ambassador Ronald Sanders of Antigua and Barbuda and Ambassador Riyad Insanally of Guyana.

The Adrienne Arsht Latin America Center (AALAC) broadens understanding of regional transformations through high-impact work that shapes the conversation among policymakers, the business community, civil society, and media. Founded in 2013, the center focuses on Latin America’s strategic role in a global context, with a priority on pressing political, economic, and social issues that will define the trajectory of the region, now and in the years ahead. Select lines of programming include: China in Latin America; Venezuela’s crisis; Mexico’s US and global ties; Colombia’s future; a changing Brazil; Central American prosperity; combatting disinformation; shifting trade patterns and modernization of supply chains; charting a post-COVID future; Caribbean development; and leveraging energy resources. Jason Marczak serves as center director.

1    The Caribbean Community member states are as follows: Antigua and Barbuda, the Bahamas, Barbados, Belize, Dominica, Grenada, Guyana, Haiti, Jamaica, Montserrat, Saint Lucia, Saint Kitts and Nevis, Saint Vincent and the Grenadines, Suriname, and Trinidad and Tobago. 
2    US Department of State Archive, Caribbean Third Border Initiative, fact sheet, April 21, 2001, https://2001-2009.state.gov/p/wha/rls/fs/2001/18123.htm
3    “Fact Sheet: Biden-Harris Administration Unveils Strategy for Global Vaccine Sharing, Announcing Allocation Plan for the First 25 Million Doses to be Shared Globally,” White House, June 3, 2021, https://www.whitehouse.gov/briefing-room/statements-releases/2021/06/03/fact-sheet-biden-harris-administration-unveils-strategy-for-global-vaccine-sharing-announcing-allocation-plan-for-the-first-25-million-doses-to-be-shared-globally/.
4    Kaitlan Collins and Maegan Vazquez, “US has bought and will donate 500 million doses of Pfizer’s vaccine worldwide,” CNN, June 9, 2021, https://www.cnn.com/2021/06/09/politics/us-buys-pfizer-doses-to-donate/index.html 
5    “The World Bank in the Caribbean,” World Bank, accessed June 8, 2021, https://www.worldbank.org/en/country/caribbean/overview.  
6    Ibid.
7    “The World Bank” in Marla Dukharan, COVID-19 Caribbean Economic Impact Report, 6, March 30, 2020, https://marladukharan.com/wp-content/uploads/2020/03/MD-COVID19-CaribbeanEconomicImpact.pdf.
8    “The World Bank” in Marla Dukharan, COVID-19 Caribbean Economic Impact Report, 6, March 30, 2020, https://marladukharan.com/wp-content/uploads/2020/03/MD-COVID19-CaribbeanEconomicImpact.pdf
9    Matt Turner, “Caribbean Tourism Organization Partners with UNWTO on Tourism Data Workshop,” Travel Agent Central, February 18, 2021, https://www.travelagentcentral.com/caribbean/caribbean-tourism-organization-partners-unwto-tourism-data-workshop
10    “Micro, Small and Medium-Sized Enterprises,” IDB Invest, accessed June 8, 2021, https://idbinvest.org/ en/solutions/advisory-services/micro-small-and-medium-sized-enterprises
11    Economic Commission for Latin America and the Caribbean, “Financing for development in the era of COVID-19 and beyond: Priorities of Latin America and the Caribbean in relation to the financing for development global policy agenda,” No.10, Special Report COVID-19, March 11, 2021, https://www.cepal.org/sites/default/files/publication/files/46711/S2100063_en.pdf
12    Reuters COVID-19 Tracker, “Trinidad and Tobago,” accessed May 20, 2021, https://graphics.reuters.com/ world-coronavirus-tracker-and-maps/countries-and-territories/trinidad-and-tobago/
13    Reuters, “Trinidad and Tobago declares state of emergency as COVID-19 cases surge,” May 15, 2021, https://www.reuters.com/world/trinidad-tobago-declares-state-emergency-covid-19-cases-surge-2021-05-15/
14    Reuters COVID-19 Tracker, “Guyana,” accessed May 20, 2021, https://graphics.reuters.com/world-coronavirus-tracker-and-maps/countries-and-territories/guyana/.
15    Reuters COVID-19 Tracker, “Suriname,” accessed June 2, 2021, https://graphics.reuters.com/world-coronavirus-tracker-and-maps/countries-and-territories/suriname/.
16    National Oceanic and Atmospheric Administration, NOAA predicts another active Atlantic hurricane season, media release, May 20, 2021, https://www.noaa.gov/media-release/noaa-predicts-another-active-atlantic-hurricane-season.
17    Maria Fernanda Bozmoski and Wazim Mowla, “Hemispheric Aid During a Unique Hurricane Season,” Real Clear World, April 27, 2021, https://www.realclearworld.com/articles/2021/04/27/hemispheric_aid_during_a_unique_hurricane_season_774712.html
18    Ainsworth Morris, “Jamaica receives 14,400 doses of vaccines under COVAX,” Jamaica Information Service, March 16, 2021, https://jis.gov.jm/jamaica-receives-14400-doses-of-vaccines-under-covax/.
19    Pan American Health Organization, “Barbados receives its second batch of COVID-19 vaccines through COVAX facility,” May 11, 2021, https://www.paho.org/en/news/11-5-2021-barbados-receives-its-second-batch-covid-19-vaccines-through-covax-facility
20    Pan American Health Organization, “Trinidad and Tobago receives second shipment of COVID-19 vaccines through the COVAX Facility,” May 12, 2021, https://www.paho.org/en/news/12-5-2021-trinidad-and-tobago-receives-second-shipment-covid-19-vaccines-through-covax.
21    Pan American Health Organization, “Guyana Receives Second Shipment of 38,400 COVAX Vaccines,” May 10, 2021, https://www.paho.org/en/news/10-5-2021-guyana-receives-second-shipment-38400-covax-vaccines.
22    Narissa Fraser, “Covax to deliver covid19 vaccines to St. Vincent, Grenada next week,” Trinidad and Tobago Newsday, May 21, 2021, https://newsday.co.tt/2021/05/21/covax-to-deliver-covid19-vaccines-to-st-vincent-grenada-next-week/.
23    Pan American Health Organization, “Antigua and Barbuda receives the first COVID-19 vaccines through the COVAX Facility,” April 8, 2021, https://www.paho.org/en/news/8-4-2021-antigua-and-barbuda-receives-first-covid-19-vaccines-through-covax-facility.
24    Pan American Health Organization, “St. Vincent and the Grenadinnes receives the first VOCID-19 vaccines through the COVAX Facility,” April 7, 2021, https://www.paho.org/en/news/7-4-2021-st-vincent-and-grenadines-receives-first-covid-19-vaccines-through-covax-facility
25    Wazim Mowla, “Vaccines Open an Opportunity for U.S. Diplomacy in the Caribbean,” Real Clear World, April 16, 2021
26    Bureau of Western Hemisphere Affairs, “U.S. Strategy for Engagement with the Caribbean,” US Department of State, July 23, 2019, https://www.state.gov/u-s-strategy-for-engagement-in-the-caribbean/.
27    Daniel F. Runde, Linnea Sandin, and Amy Doring, Reimagining the U.S. Strategy in the Caribbean, Center for Strategic and International Studies, April 2021
28    Enterprise Florida, 2019 Florida International Business Highlights, June 2020
29    Ibid.
30    Johanna Jainchill, “Economic pain from cruise industry shutdown is far-reaching,” Travel Weekly, June 5, 2021
31    “COVID-19 Travel Recommendations,” Centers for Disease Control and Prevention, accessed June 7, 2021, https://wwwnc.cdc.gov/travel/noticescovid19
32    Statista, “Number of visitors to the United States from the Caribbean from 2011 to 2020,” accessed June 8, 2021, https://www.statista.com/statistics/254161/forecasted-inbound-travel-from-the-caribbean-to-the-us/.
33    Office of the Spokesperson, US Department of State, Secretary Blinken’s Roundtable with CARICOM Foreign Ministers, media note, April 21, 2021, https://www.state.gov/secretary-blinkens-roundtable-with-caricom-foreign-ministers/.
34    White House, “Readout from NSC Spokesperson Emily Horne on National Security Advisor Jake Sullivan’s Call with CARICOM Leaders,” May 7, 2021 
35    Ryan Hamilton-Davis, “Trinidad and Tobago to take Chinese loan to buy Chinese vaccines,” Trinidad and Tobago Newsday, May 11, 2021, https://newsday.co.tt/2021/05/11/trinidad-and-tobago-to-take-chinese-loan-to-buy-chinese-vaccines/.
36    Loop News, “Sinopharm vaccines arrive in Trinidad and Tobago,” May 19, 2021, https://tt.loopnews.com/content/sinopharm-vaccines-arrive-trinidad-and-tobago
37    Janelle De Souza, “[updated] 200,000 Sinopharm vaccines to arrive on Monday,” Trinidad and Tobago Newsday, June 12, 2021. https://newsday.co.tt/2021/06/12/200000-sinopharm-vaccines-on-its-way-to-trinidad-and-tobago/
38    Darlisa Ghouralal, “US donates 400 doses of Pfizer vaccines to T&T,” Loop News, June 13, 2021, https://tt.loopnews.com/content/us-donates-400-doses-pfizer-vaccines-tt 
39    Randy Bennett, “Barbados to get 30,000 doses of Chinese Sinopharm vaccine – PM Mottley,” Barbados Today, April 1, 2021
40    Xinhua, “Guyana receives donated COVID-19 vaccines from China,” Xinhuanet, March 3, 2021. http://www.xinhuanet.com/english/2021-03/03/c_139780346.htm.
41    Ministry of Foreign Affairs of the People’s Republic of China, “Dominican Prime Minister and Charge d’Affaires of Chinese Embassy attend vaccine handover ceremony,” March 5, 2021, https://www.fmprc.gov.cn/mfa_eng/wjb_663304/zwjg_665342/zwbd_665378/t1858966.shtml
42    Jason Marczak, Pepe Zhang, and Cristina Guevara, “COVID-19 vaccine tracker: Latin America and the Caribbean,” Adrienne Arsht Latin America Center, Atlantic Council, May 12, 2021, https://www.atlanticcouncil.org/in-depth-research-reports/covid-19-vaccine-tracker-latin-america-and-the-caribbean/.
43    Jacqueline Charles, “Some Caribbean, Latin American nations are finally getting COVID vaccines, thanks to India,” Miami Herald, February 18, 2021 (updated February 19, 2021), https://www.miamiherald.com/news/nation-world/world/americas/article249351155.html
44    Vishani Ragobeer, “Largest shipment of COVID-19 vaccines arrives in Guyana,” Guyana Chronicle, April 20, 2021, https://guyanachronicle.com/2021/04/20/470225/.
45    Nation News, “Antigua & Barbuda signs bilateral agreement with Russia,” June 8, 2021, https://www.nationnews.com/2021/06/08/antigua-barbuda-signs-bilateral-agreement-russia/
46    Nation News, “Antigua & Barbuda signs bilateral agreement with Russia,” June 8, 2021, https://www.nationnews.com/2021/06/08/antigua-barbuda-signs-bilateral-agreement-russia/ 
47    Wazim Mowla, “A Cuban lifeline to CARICOM,” Global Americans, May 7, 2020, https://theglobalamericans.org/2020/05/a-cuban-lifeline-to-caricom/
48    Wazim Mowla, “New Cuba bill puts a strain on U.S.-Caribbean relations,” Global Americans, July 16, 2020, https://theglobalamericans.org/2020/07/new-cuba-bill-puts-a-strain-on-u-s-caribbean-relations/.
49    Pan American Health Organization, “Canada and PAHO join forces to advance COVID-19 vaccination of people in a situation of vulnerability across the Caribbean and Latin America,” May 21, 2021, https://www.paho.org/en/news/27-5-2021-canada-and-paho-join-forces-advance-covid-19-vaccination-people-situation
50    Xinhua, “Guyana receives donated COVID-19 vaccines from China,” Xinhuanet, March 3, 2021, http://www.xinhuanet.com/english/2021-03/03/c_139780346.htm.
51    Xinhua, “Dominica receives China-donated COVID-19 vaccines,” March 5, 2021, http://www.xinhuanet.com/english/2021-03/05/c_139786815_3.htm.
52    US Department of Defense, “Southcom Donates Field Hospital to Jamaica in Support of COVID-19 Response,” September 25, 2020, https://www.defense.gov/Explore/News/Article/Article/2358742/southcom-donates-field-hospital-to-jamaica-in-support-of-covid-19-response/

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The post-COVID world this week: Delta disaster, Olympic positives, and the world’s emerging indirect health crisis https://www.atlanticcouncil.org/blogs/coronavirus-alert/the-post-covid-world-this-week-delta-disaster-olympic-positives-and-the-worlds-emerging-indirect-health-crisis/ Sat, 26 Jun 2021 00:47:13 +0000 https://www.atlanticcouncil.org/?p=409378 Let’s take a spin around the globe. This week’s key theme: COVID’s massive indirect blow to the world’s health.

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The future is here: A guide to the post-COVID world 06/25/2021

Welcome to your guide to where the world is headed during the pandemic era and beyond, from Andrew Marshall. Each week, we’ll bring you the latest and most significant expert insights and international news about how coronavirus is reshaping international affairs. To stay updated each week, sign up to the newsletter here.

Let’s take a spin around the globe, in seven minutes or less.

In top stories this week:

  • The Delta variant gets scarier.
  • Positive tests hit the Olympics a month early.
  • But first…

The big story

This week’s key theme: COVID’s massive indirect blow to the world’s health.

Not to be a downer, but: You are probably about to get a cold. Or your kid is, if you have one. And if your kid gets a cold, so will you.

This (familiar) logic has been largely suspended for the past year-and-a-half, as we dealt with COVID-19 lockdowns. Now it’s returning. My colleague Alex’s son had a cold, and then a week later, so did he.

It turns out that Alex is a trendsetter (we always knew it). “As more people venture out of their bubble and take off their masks, some are catching what they call ‘the reemergence cold,’” says CBS New York, as the health effects of COVID beyond the pandemic itself start to come into focus.

“It’s the first time since April 2020 where we’re starting to see other things circulating,” Trevor Bedford, of the Fred Hutchinson Cancer Research Center in Seattle, tells STAT news. Some of these maladies are short-term irritations like a cold; some are more serious, like Respiratory Syncytial Virus (RSV)—which can be dangerous to children.

“These common viruses are showing up at a distinctly uncommon time of year—and sometimes with uncommon virulence among children whose immune systems did not begin building up familiarity with them while the pandemic kept people isolated at home,” says the Washington Post.

Some of the collateral effects were positive. Seasonal flu killed an estimated 4,000 to 22,000 people annually in the UK—until it pretty much vanished last year, reports the Guardian. There isevidence that incidence of some other infectious diseases fell, though what really fell was the number of visits people made to the doctor and the diagnoses those doctors might have made.

“There were substantial reductions in primary care contacts for acute physical and mental conditions with restrictions, with limited recovery by July 2020,” according to a study in the Lancet Digital Health medical journal. “It is likely that much of the deficit in care represents unmet need, with implications for subsequent morbidity and premature mortality.” Those diseases still happened but didn’t get spotted, and some will kill people.

This goes well beyond the direct effects of COVID. Factors that will worsen the effects of heart disease, for example, include “lifestyle changes, reduction in physical exercise, home working, disrupted education for pupils, reduced social interactions, more perilous mental health, and socioeconomic hardship,” says one study in the European Heart Journal.

Plus, vaccination for non-COVID diseases fell dramatically because of the pandemic. “Early reports during the COVID-19 pandemic documented a marked decline in pediatric vaccine ordering and administration, placing U.S. children and adolescents at risk for vaccine-preventable diseases,” the Centers for Disease Control and Prevention reports.

The pandemic has been a big backward step for health—especially in the US. “The U.S. has experienced a massive decline in life expectancy in 2020 on a scale that hasn’t [been] seen since World War II,” Dr. Steven Woolf of the Center on Society and Health at Virginia Commonwealth University in Richmond, tells USA Today in discussing a new study in the BMJ, a journal by the British Medical Association. “That’s pretty stunning and it was not experienced on that scale by other countries.”

What is worse is that those positive and negative effects are not equally distributed. “Individuals with lower resources and from more deprived communities are likely to be more negatively affected… while those with more resources may be more likely to experience the benefits,” concludes a study from the International Journal for Equity in Health.

That is especially the case in poorer countries. In Africa and Asia, “the stark truth is that we will see more incremental deaths from HIV, TB and malaria in 2021 as a consequence of the disruption caused by COVID-19 in 2020,” says Peter Sands, executive director of the Global Fund, which manages the purchase of drugs for these diseases.

And it’s also true in the US. “We found large differences in the reductions in life expectancy during the covid-19 pandemic based on race and ethnicity. Decreases in life expectancy among Black and Hispanic men and women were about two to three times greater than in White people, and far larger than those in peer countries,” says the BMJ study.

Just as the future is already with us in small ways—glimpses of innovations yet to come—so the past lives on with us in visible and invisible ways. Missed vaccinations, lost immunity, the exercise you didn’t do—all of those will linger as the world recovers and we forget we ever wore a mask to the supermarket. Summer colds are the least of it, but they’re a reminder.

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The world in brief

Insights from across the planet, in ten bullets or fewer

  • The Biden administration will probably miss its vaccination goal. The president had said he hoped to provide at least one COVID-19 vaccine dose to 70 percent of adults by July Fourth, but the rate of vaccination has slowed.
  • The Delta variant poses an increasing threat. “The U.S. government is stepping up efforts to get younger Americans vaccinated for COVID-19 as concerns grow about the spread of a new variant that threatens to set the country back in the months ahead,” says NBC. It represents more than one-fifth of coronavirus infections in the US in the past two weeks. And a new version—Delta Plus— sounds like a premium airline status but actually “may be more transmissible and resistant to COVID-19 treatments,” says NPR
  • Chinese-made vaccines may not work so well. “Examples from several countries suggest that the Chinese vaccines may not be very effective at preventing the spread of the virus, particularly the new variants,” the New York Times reports. “The experiences of those countries lay bare a harsh reality facing a post-pandemic world: The degree of recovery may depend on which vaccines governments give to their people.”
  • The COVID surge in Africa continues unabated. “African health officials are urgently appealing for vaccines to combat a third wave of COVID-19 surging across the continent,” reports Voice of America. “WHO regional director for Africa Matshidiso Moeti says cases have been increasing over the past four weeks. She says new cases in the past week have risen by nearly 30% across the continent and deaths have increased by 15%.” Meanwhile, Uganda is running out of oxygen, according to NPR
  • The Olympics gets its first positive cases. Two members of the Ugandan team have been put in isolation after their arrival in Japan, with the games still a month away. “The Tokyo Olympics, already delayed by the pandemic, are not looking like much fun: Not for athletes. Not for fans. And not for the Japanese public,” the Associated Press writes. The games are pressing ahead despite the threat.
  • COVID has left societies more divided. study from the Pew Research Center of seventeen advanced economies shows that “about six-in-ten report that national divisions have worsened since the outbreak began.” There is a stark division over how far restrictions should go. About 40 percent believe the level of restrictions on public activity has been about right. “A nearly equal share believes thereshould have been more restrictions to contain the virus. A minority in most publics think there should have been fewer restrictions.”
  • State and county fairs are coming back. Nothing could be more American than these celebrations of everything rural and local. Last year, most were canceled, but they are all coming back in 2021. “The good news now is that most of Vermont’s fairs are gearing up for a big return in just a few weeks,” reports MyChamplainValley.com. The New York State Fair is returning at 100 percent capacity, says North Country Public Radio. The Chicago Tribune celebrates that “one of the big draws, the butter cow, will be celebrating its 100th anniversary at the Illinois State Fair this summer,” while the Monmouth Fair in Maine will host pig scrambles. And if you don’t know what butter cows and pig scrambles are, it’s time to leave your house and find out. AP News has all the latest developments here

The inside scoop

Insights from the Atlantic Council

Andrew Marshall is the Vice President of Communications for the Atlantic Council. He leads the Council’s media, digital, and editorial efforts, and coordinates the way the Council talks with its key communities.

The post The post-COVID world this week: Delta disaster, Olympic positives, and the world’s emerging indirect health crisis appeared first on Atlantic Council.

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Ashish Jha: Doctors must train for the new battlefield of information—social media https://www.atlanticcouncil.org/news/transcripts/ashish-jha-doctors-must-train-for-the-new-battlefield-of-information-social-media/ Thu, 24 Jun 2021 21:37:54 +0000 https://www.atlanticcouncil.org/?p=408729 This fireside chat between Dr. Ashish Jha, dean of Brown University’s School of Public Health, and Renee DiResta, research manager of the Stanford Internet Observatory, explored the long-lasting effects of the COVID-19 “infodemic” and how the misinformation research community can work with health professionals to restore and protect public trust.

The post Ashish Jha: Doctors must train for the new battlefield of information—social media appeared first on Atlantic Council.

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Watch the full event
Internet Generic

360/Open Summit: The world in motion

June 22 – 25, 2021

The Atlantic Council’s Digital Forensic Research Lab (DFRLab) hosts 360/Open Summit: The World in Motion on June 22-25 online.

Event transcript

Speaker
Dr. Ashish Jha
Dean of the School of Public Health, Brown University

Moderator
Renee DiResta
Technical Research Manager, Stanford Internet Observatory

RENEE DIRESTA: I think that that—you know, “Plandemic” is really the perfect lead-in to our conversation here with Dr. Ashish Jha. Dr. Ashish Jha has done some really great, ground-breaking research around Ebola. He’s been on the frontlines of the COVID-19 response, leading national and international analysis advising—around key issues, as well as advising policymakers at both the state and federal level.

And I’d love to just start with a little bit of foundational knowledge on what’s been different this time? How has the work that you did on Ebola—you know, I recall personally seeing many misinformation narratives around Ebola when, there were a couple patients in the US. This was a major topic of international attention. Compared to what we’ve seen now with COVID and the information dynamics there.

ASHISH JHA: Yeah, so, Renee, thank you for that question. And all of you, thanks for having us here.

You know, I am somebody who’s spent my whole life studying public health. And I’ve had a mental model of how public-health-knowledge communication happens, how information flows. But I started getting tested a little bit during the Ebola outbreak, where I first saw a sort of misinformation starting to play a sizable role. It has played a role in other pandemics as well. But what is happened in the COVID-19 pandemic, I think, has taken all of us in the public-health community completely by surprise. While you had narratives come up during the Ebola outbreak of, you know, what caused the outbreak, what was going on, you could counter it pretty easily and get people to understand what the disease was, how to manage it, how to respond to it.

During this pandemic, I have… at some point I realized: There’s all the complexity around the virus itself and understanding the science and understanding how to respond to it. But the misinformation and the disinformation that was in the ecosystem was unlike anything I had ever seen or read about from history or experience. And it really ended up becoming a very large part of what I think hobbled us as a country and as a globe and continues to plague us today. It really is stuff we’ve seen before, but at a very, very different level.

RENEE DIRESTA: Do you think the difference was scale and scope of this disease? Or do you think it was perhaps more the changing information infrastructure and architecture in the, I think, four-odd years since the Ebola outbreak?

ASHISH JHA: Yeah, can I say yes? Like, I think it was both, right? (Laughter.)

RENEE DIRESTA: Sure.

ASHISH JHA: I mean, so on one hand just forget the information architecture and how that has changed over the last five years. And I want to come back to that. Just the size and scope of this outbreak and this pandemic is unlike anything we’ve seen in a century. And so that unto itself is going to, under any circumstance, create a lot more anxiety, a lot more uncertainty. It’s going to create what I think is kind of the perfect medium for misinformation. And so even if this pandemic had happened twenty years ago, I think we would have seen a lot more than we did, for instance, under Ebola.

But of course, the information architecture for our kind of world has changed in this very, very dramatic way. And I think most of us in public health were not aware of that, the rise of kind of—the sheer amount of, like, bots and other kind of automated information that’s plaguing or filling up our Twitter timelines, or the way information is—misinformation is created and spread. Like, I just—no one in public health had any training on the subject at all. And I think we were floored by it. And I think that’s different because of the information architecture we have now.

RENEE DIRESTA: I remember in 2015 or 2016, I think it was, speaking to some folks at the Berkeley School of Public Health. And what we were talking about was the measles outbreak, actually, and the subsequent fight in California to eliminate vaccine opt-outs. And the thing that was so interesting about that was I remember a student in the audience, a public-health student, asking, “Do you think that we need to be spending more time on Twitter?” Because my presentation was about how public health was largely absent in that conversation, how the anti-vaxxers were kind of running the game on Twitter at the time.

And I remembered receiving the question and feeling like it would be so outrageous to tell doctors and public-health workers that they needed to be Twitter more. You know, surely they had better things to do. I’m curious how you think about that today. Do you feel that that communication function has really become an integral part of public health? Or do you think that those two things should remain separate in some way?

ASHISH JHA: Yeah, I think it has become integral. Like, I think there is no way to be a public-health person—because look, public health isn’t just about health. It’s also about the public, right? You got to engage the public. You got to engage the conversation that is happening nationally. And you got to shape that conversation. The idea that you can do that completely staying off of social media I think is a fantasy. And I have come to realize that, in fact, social media is a great platform for spreading information, for spreading good information. Good information can go viral quite effectively as well.

So I have come to believe that the next generation of public-health figures all absolutely have to be trained in these things, have to engage in these things. Otherwise, we leave this new medium completely wide open to one group of people who are very, very good at exploiting it and using it for nefarious purposes. You just can’t walk out of the battlefield. This is the battlefield of information now. And you know, hearts and minds of the public are won by it.

And the reason it’s so important is because in [an] outbreak like this, you need collective action, right? You need people to wear masks. Well, you’ve got to have everybody wearing them or most people wearing them. You’ve got to have most people getting vaccinated. And that means you’ve got to engage the public in a very, very deep and personal way. I don’t know how you do that today without being on social media.

RENEE DIRESTA: One of the challenges that struck me in the early days of the pandemic was really that the influencer dynamics were really quite tilted towards whoever had influence already, right? So if you had large followings, then people were going to pay attention to what you said. And that was just the structure of your megaphone, and it didn’t matter whether you had expertise or not. And so this led me to think a little bit about, you know, Twitter began to verify doctors. It tried to elevate authoritative voices in particular so that just influential loud voices that were not necessarily experts in any way or did—or were, in fact, sometimes spreading completely wrong information would not be the only thing that the public saw. I’m curious how you think about that sustained engagement. You know, where do you want to see public-health officials and government moving forward as we enter into what is hopefully the tail end of the pandemic? Do you think it’s the tail end of the pandemic?

ASHISH JHA: It is certainly the better end of the pandemic in the United States. But about an hour ago I got off a Zoom call with a group of leaders across the African continent. It is not anywhere near the tail end for Africa, for much of Asia. So the pandemic is going to be with us and is going to continue to challenge us probably for another twelve to eighteen months, but I think in the US, we’re certainly on the much, much better side of things.

Two thoughts, really, as you sort of were talking about this. I mean, one is, you know, on a personal level, I got verified during the pandemic. I don’t even remember when. I want to say like June or July [or] at some point over the summer. And it was interesting to see Twitter make a decision to start verifying people as a way to try to bring more credibility—or, credible voices to the conversation. And I thought that was great, by the way.

There are plenty of people who spread massive amounts of misinformation who are verified as well. So it’s not like verification is any kind of a tool for credibility. But I shouldn’t say it’s not any good. It does add a little, but there’s plenty of examples of people who actively spread misinformation. And I’m thinking specifically, for instance, of a guy named Alex Berenson, who is a former New York Times reporter who’s probably spread more misinformation in this pandemic than anyone else I can think of and can has pretty consistently been wrong on everything. He’s verified and he’s been out there for a very long time.

So it is interesting to ask the question, “What is Twitter’s responsibility?” Is verification seen as some sort of endorsement? Or is it purely an authenticating mechanism like, yeah, this person really is who they say they are? I think that’s a really important part of the debate that we ought to be having, and Twitter ought to be having internally, for how they do it.

You know, in terms of as this pandemic ends—I mean, whether it’s now, or six months, or eighteen months from now the pandemic will end, because every pandemic ends—there’s a very important question of how do public-health people stay engaged. I mean, first of all, I hope that the world thinks less on a daily basis about pandemics because, my God, it has dominated all of our lives and we all need to get back to thinking about other stuff. But there are a lot of public-health challenges, including preventing the next pandemic, that’s going to be really important, and I hope that the public-health community is able to really stay engaged in those issues, to continue to drive improvements in people’s health, because that’s going to be a really necessary part of recovering from the pandemic.

RENEE DIRESTA: So one of the reasons that some of the folks that you’ve mentioned, the influencers… aren’t spreading credible information or are spreading misinformation, is that they enjoy the trust of their audience. And thinking about that trust relationship, which is a far bigger problem than social media, but just thinking about, how can public-health officials begin using these tools to sustain or grow the trust of the public in these intervening times?

ASHISH JHA: That’s a really good question. So I’ll tell you some of the things that I personally tried to do that I’ve seen colleagues do that I think is good practice. So, right, we’re in a pandemic with a novel virus. What does that mean? It means none of us are going to get everything right. There have been plenty of things that I thought were going to happen in a certain way that turned out not to happen that way, and I learned something.

So one part of building trust is acknowledging error. When Texas, in March, said they were lifting all their mask mandates, I thought it was a problem. I thought it was going to lead to a spike in cases in Texas. Guess what? It didn’t. I was wrong about that. So acknowledging that when you get it wrong and saying, yep, I got that part wrong, and trying to explain to people why and what you’ve learned out of that, I think, is really important.

There are times when I tweet things that I realize land completely in a different way than I intended. I meant to say A. I was trying to be a little bit, you know, pithy or cute, and if people understand it as B, and then it’s a challenge. What do you do, especially if it’s bound to be retweeted a lot? And, you know, so I’ve been trying, and I’d encourage other people to do some basic stuff like delete it, take a picture of it, explain why you’re deleting it. Being able to acknowledge errors—I think that kind of stuff is very, very important for the public because then they have a sense that when you get something wrong, you’re going to hold yourself accountable and you’re going to try to hold each other accountable, and that allows them, I think, to feel more confident in what you do say and what ends up staying up.

But I’m game for ideas about other things as well that we could be doing. Like, I don’t know how to do this.

RENEE DIRESTA: For those of us who study the dynamics of these systems, I think it’s imperative for us to also understand impact, right, and to understand also what are the policy, education, and design levers that we have at our disposal to mitigate some of the harms as we’ve seen them play out over the last year and a half.

One of the things that I’ve been struck by is the difference in time horizon, right. So for you, this process of discovery, this process of understanding, of scientific consensuses happening, per your point, this is a novel virus. It’s not like measles where you can point to it and say, this is what we’ve known from decades of experience and, you know, of research of the very old and established vaccines at this point.

So you have this challenge of coming to consensus in full public view at an age in which the slower pace of that discovery conflicts with the speed of information that people expect on the internet. You know, I expect when I open my Twitter feed that something new is going to be at the top of it and, particularly in the early days of the pandemic, everyone was refreshing constantly, trying to find out what was happening. What did we know now? Did hydroxychloroquine work? You know, what were the latest findings?

I’m curious how you think about that process of communicating consensus over time. How do you think, perhaps, if you were to do it again today, messaging on masks, for example, might have been? How would you do it again today if you were—if you were confronted with this situation?

ASHISH JHA: Yeah. That’s a really good question and there are kind of—in my mind, there are two or three kind of complex points. So let me see if I can just sort of make each of them and then, hopefully, across all three I’ll end up answering your question.

One is to express uncertainty more clearly. I think one of the places where we got the mask stuff really wrong last March was I think a lot of people in public health expressed a much higher degree of certainty that masks weren’t going to work than we had. And you can ask the question why. Why did people do that? And that’s because we had a mental model that basically was a mental model coming out of the original SARS outbreak of 2003, and with that coronavirus you really didn’t need to wear a mask if you were asymptomatic because you only spread the disease when you had symptoms. Asymptomatic [spread] wasn’t really much of a thing with the original SARS virus, so we all just assumed that that’s how this one was going to play out too. Bad assumption. Turned out to be very, very wrong. I think we should have been much more humble about saying this is our mental model, here’s what we think, we don’t know, and right now we don’t think wearing a mask is important. But like putting those caveats in I think would have been helpful, and there was way too much certainty.

And there is a problem here of groupthink that can happen because, you know, I always find, for instance, that I will read the literature, and then if I see Tony Fauci say something, I am going to have a very high bar for contradicting. Like, I’m going to think, like, a lot about [whether] Tony is really wrong on this. And I feel like we all do that, but that’s good because then you don’t get this massive divergence. But on the other hand, it’s bad because if one person—and I’m not saying Tony—but, like, anybody who’s got a loud voice makes a mistake, a lot of us end up following that. So I think we have to figure out how to be more careful about that.

I do think, by the way, on the issue of consensus forming, it’s really interesting that, you know, the information and knowledge is moving so incredibly quicky and there are areas where we have developed consensus very quickly. So, for instance, let’s talk about the Delta variant, which many of you probably have heard about—it’s spreading in America; it’s bad. It is actually kind of bad. We do have pretty good consensus that if you’re fully vaccinated you’re pretty protected. But everybody’s been asking me about the Johnson & Johnson vaccine and will it hold up. And you know, it’s been like a week and we don’t know. And people are like, it’s been a week, how do we not know? And I’m like, people, this would have taken five years to study. I’m actually confident we’ll know in the next five weeks. But we’ve got to help people understand that science on this stuff, as insane fast as we’re moving, you know, just can’t go that much faster without getting a lot more stuff wrong. But it is interesting because, like, I am constantly bombarded with, it’s been days since you updated us on this one important scientific fact. And I’m like, it’s true. So the expectations of how quickly science will evolve I think also need a little reset.

RENEE DIRESTA: Yeah, I think that that’s kind of common, actually, to most crisis scenarios on the internet as we see them also. Any high-profile crime also kind of suffers from this proliferation of rumors and misinformation as we try to make sense of what’s happened and figure it out.

Where do you see the impact of misinformation to COVID? One of the things that has been challenging for us, I think, as misinformation researchers is we can process engagements, right? We can tell you, as with something like “Plandemic,” how viral it went, what communities it wound up, and we can’t really make that final connection to how impactful it was because oftentimes one of the best measures of that is what people say—in the case of health misinformation, what people actually ask their doctor. You know, did they internalize this thing that they saw on the internet or did it just go by? And I’m curious, in your opinion, how you’ve seen impact from the narratives on social media in the real world in medical practices and public-health responses and elsewhere.

ASHISH JHA: Yeah. I think the impact is pretty sizeable and it’s, I think, quantifiable.

So, for instance, you know, we’ve had vaccines available for every American, everybody over age eighteen certainly, for a couple of months now, and we saw about a third of adults who have chosen not to be vaccinated. My sense is a large chunk of that is because of misinformation about the vaccines, how safe they are, how big a deal is it that the FDA has not given full approval. There’s a whole bunch of narratives out there about how these vaccines are experimental that people propagate. And the effect is that you have a lot of people who are not vaccinated, and the effect is, therefore, that we’re still having people get infected, ten to fifteen thousand a day, still having a couple hundred people die every day. That, to me, is all preventable and it’s almost all driven by misinformation, right? So that’s pretty quantifiable.

Certainly, the fact that Americans ended up having 600,000 deaths, some of that was clearly just poor response in the early days. But a lot of it, going into the fall and winter, was the misinformation that has caused a real splitting in parts of America about how big a deal this virus is. You know, it’s not like people wake up one morning and come to a different conclusion based on the same scientific facts and data. It’s because there’s been this bombardment of misinformation that has gone on in many communities and in many kinds of information ecosystems that has led to not enough mask wearing, not enough vaccines, like all that stuff. So, in my mind, it’s pretty clear that that misinformation has had very, very specific effects.

And the last point I’ll make on this is, you know, you can have all the policies you want, right—you can have President Biden come out and say everybody should wear a mask, that you should get vaccinated—but at the end of the day public health is, yes, a little bit about policy, but it’s a lot about public action. And public action is motivated by public beliefs, and public beliefs are clearly shaped by the information ecosystems that people live in. And as I started with, I think the people in the public-health community largely missed this, and we have to do very, very differently not only for the rest of this pandemic but for future health crises.

RENEE DIRESTA: I like that framing of public action shaped by public beliefs and the beliefs being impacted significantly by the information environments that we operate in.

I’m curious, given that we are operating in these information environments, do you have any steps that you would recommend platforms or public-health communicators or anyone take to help inoculate the public against future infodemics? Is there anything drawing on, again, kind of a similar question to the consensus one, but how might we do better the next time in terms of communication to the public and public inoculation?

ASHISH JHA: Yeah. It’s a really good question, and I have just sort of recently in some ways started thinking about this. As I said and I kind of admitted a year-and-a-half ago, I spent very little time thinking about these issues. I really had a mental model that said, you know, if there is a new pandemic, we use science, we figure out what the right answers are, and then we share it with people, and people will act, and it’ll be fine. I realize that sounds insanely naïve and I apologize, but you know, I’ve learned in the last eighteen months that that’s not the world we live in. And I realize many of you have known longer than eighteen months that that’s not the world we live in.

When I think about what needs to be done to inoculate against future ones, I think about this kind of in a classic public-health way of, like, there’s a set of responsibilities that all of us have. So there are a set of responsibilities individuals have—and I talk about this a lot with my physician colleagues, with my public-health colleagues—about the importance of spreading good information and the importance of countering misinformation when it makes sense to do so. Doesn’t mean that every single response on Twitter needs to have a response to it—and actually, most of the times you should probably not engage—but that when people inadvertently spread misinformation, I sort of—at least in my mental model I think of it as like if you’re walking through the woods, if you see trash, you want to pick it up, and you want to plant more seeds so that in the future there will be more trees. And so one is definitely a set of individual responsibilities.

And the only other thing I’ll say on the individual side is because people live in such different information ecosystems, one of the things I’ve been sort of talking to my colleagues about is trying to get out of our own bubbles and trying to spend more time talking to people and engaging with people who are not part of our ecosystem. So, for instance, on a personal level, you know, I do a reasonable amount of television media. One of the things I said to my team about, like, who to say yes to and no to is I always say yes to Newsmax and always say yes to Fox News because in general the people I communicate with tend to not watch those channels, when I’m communicating on Twitter or other means, right? So it’s getting out of your bubble and trying to talk to people who—these are good people; they just live in a different information ecosystem. So breaking out of your own, I think, is really important.

Two more quick things on this. One is I think there’s a set of things that academics need to do—academia needs to do. I think academia needs to treat this like any other complex problem. We need to do the work of, you know, really studying what’s going on, what are the drivers of misinformation, a lot of work that’s already happening and stuff that’s happening at Stanford, happening elsewhere.

And then, obviously, there’s a set of responsibilities that platforms have and policymakers have. And you know, what’s been interesting in this pandemic is, again, by May/June when I think, like, I was starting to come to realize what was going on, and I started talking publicly about it and the role of Twitter and Facebook and Google, what was interesting to me was some of these platforms—in a couple public places I kind of called out these guys for not doing enough, and I found some of the platforms very responsive. Their leadership actually reached out and said we want to do more and we want to do better; how do we do that? And others who basically were like, yeah, no, this is not our responsibility. We’re just a platform. Like, we’re not responsible for, like content. And I thought that that splitting between the different platforms was really, really interesting.

Last point, you know, everybody sort of talks about what is the role of regulation, and I’m struck by the fact that, like, it seems to me that we will end up needing to regulate this. We can’t have a mental model of you regulate it or you don’t regulate it. It takes a while to figure out what is the right regulatory mechanism, how do we do this in a way that doesn’t stifle free speech, that doesn’t give government too much power. But what are the guardrails that we, as a society, are willing to live with?

I’m worried that, like, the conversation has become too black or white about, like, yes regulate, no regulate. It’s really about what is the kind of thing that we want to do to try to clean this up a little bit without letting it become overly onerous and really stifling the ability of people to have free exchange of ideas.

RENEE DIRESTA: I particularly appreciated the one about engaging with the media outside the beltway. That’s very, very important. I think it doesn’t do very much good to kind of consistently be speaking to people who are already vaccinated, who already believe that masks work and are taking appropriate steps. So I appreciate your efforts on that front as a communicator.

We have a couple questions from the audience, so I’ll ask one now. The question is: How can public-health officials strike the balance between certainty and uncertainty without losing credibility, particularly when going against disinformants that often offer narratives that may feel more certain because they are simplistic and offer quick, easy, or entertaining answers?

ASHISH JHA: Yeah. That’s a really good question. I think my personal approach, and I think what the people that I admire, what they do, is to be honest about the level of uncertainty you have. But—here’s the kind of key part, right—like, where academics fall into a trap is they feel like unless they’re 100 percent sure they can’t say anything. And that’s just wrong. (Laughs.) And in a pandemic, you’re not going to be 100 percent sure about very many things for a very long time. And you leave too big a vacuum.

So, for instance, I think back to when the vaccines started first coming out and the data on vaccines started coming out. And the question that kept coming up is, OK, so these vaccines seem to protect people but do they reduce transmission? If you’re vaccinated are you less likely to spread it? The short answer was, we weren’t sure. But the slightly longer answer was they probably did. Like, it just would make sense if you understood how vaccines work and how these vaccines work.

And you had a whole lot of public-health people coming out and saying: We have no idea. And that got translated into: No, the vaccines don’t stop transmission. And that, I think, ended up causing a lot of harm because then, of course, misinformationists, like, then used that and said, well, these vaccines don’t even stop transmission. Why would you get vaccinated if you’re low risk? And I think it’s part of the reason why many young people continue not to be vaccinated.

One of the things that I, and I think several of us, tried to do was say: We don’t know for sure, but this is where we think the data’s almost surely going to end up. And my assumption is this, right? Like, give people a sense of where it’s heading even if you aren’t certain. I think people are not looking for certainty. They’re looking for judgement and weight, and your best assessment of the situation. It’s how you practice medicine, right? Like, when I see a patient with a disease, I often don’t know for sure what they have, but I have a pretty good guess, I have an assessment, I tell them how I’m going to figure it out. And people are willing to cut you slack. And that’s about communicating uncertainty, but not to the point where it seems like you have no idea what’s going on at all.

RENEE DIRESTA: One of the things that I think has been interesting with platforms in particular is they’ve been trying to fact check things rather reactively, which leads to something when something is found to be counter to the initial assessment of the fact checker, has then led to subsequent opportunities to erode confidence in the fact-checker, the speaker, the media. And so it really has turned into a disinformation campaign itself in the sense of just a campaign to systematically erode trust in any sort of authority, whether that be media, institutional, health, fact checking. So I think that that transparent communication model is quite critical.

We have—here’s a fantastic question: Are we better or worse off than we were after 1918?

ASHISH JHA: Oh, I think way better off. Way better off. So let me make the case. I mean, obviously in some ways we’re quite—there are things that are much worse, right, in the way misinformation and disinformation has spread. But these communication tools have also been incredibly powerful in two ways. I mean, one, as a way to communicate to the broad public. I think that a lot of people in the public who didn’t know what was going on—I mean, in some ways none of us knew exactly was going on last February and March. But there was a lot of fear and a lot of uncertainty. And I think there were a lot of public-health voices that were able to step in and help people through this pandemic. These platforms were incredibly powerful for that.

The second way is ways in which scientists are able to communicate with each other using these platforms. That ends up actually being really, really useful as well. There’s a whole group of public-health scientists that—somebody posts something that I don’t know I totally agree with, sometimes publicly but sometimes through direct messaging or other ways, I’ll reach out and I’m like, I’m not sure I buy that. And then we can have an exchange. And that just wouldn’t have happened if these social media platforms didn’t exist. You know, I would have read a paper, maybe I would have written them a letter.

Like, no, it’s just I read a tweet and I think that’s wrong. But this is a really smart, knowledgeable person. I wonder why they think that. Let me clarify. And sometimes it turns out they got it wrong. Sometimes it turns out that my mental model is wrong. And that’s really helpful in driving conversations forward in a very productive way. That stuff has all been a major reason why we’ve made as much progress as we have. So, you know, do I wish we didn’t have some of the problems of the—absolutely. But would I wish that we were in 1918 land? Absolutely not.

RENEE DIRESTA: So, net on net, you think on balance social media has been a positive during the pandemic, then?

ASHISH JHA: I do. I do. I’m not sure everybody in public health agrees with that, by the way. (Laughs.) But I do.

RENEE DIRESTA: Per your point, I remember I was looking at letters to the editor of the British Medical Journal for the project I was doing. And there was, you know, the anti-vaxxer in the comments in the form of the letters to the editor, you know? And there was just these very recurring things, actually. And I think the last question in the kind of three and a half minutes we have left is: What are the narratives that you expect will outlast this period? So of the themes that we’ve seen emerge, you know, what do you think the impact of the COVID-19 infodemic will be on public health, you know, one year out or five years out?

ASHISH JHA: Boy, that’s a really hard question. And first let me take thirty seconds to say why it’s a particularly hard question. One of the things that happens with pandemics, if you’ve studied the history of pandemics, is that they have profound effects on society forever. If you look at the 1918 flu pandemic, which we often talk about, you know, if has this very, very big effect—not just on society, but obviously on public health. And it’s not clear to me that if we were standing together in 1918 or 19—let’s say as the flu pandemic was coming to an end, that we could have predicted all of that. So there will be a lot of changes that I think are hard to predict.

I do think the deeply globalized nature of pandemics is something that is really seeping into people’s minds, and the idea that somehow you can protect yourself, or your country, or your neighborhood while ignoring everybody else—I think that really gets blown up. And I think understanding that we need much more global coordination and global action is a narrative that I think will come out, and already, I think, has.

I believe that this is going to really restore—boy, I was about to say something and then I stopped myself. But I’ll say what I was going to say and then you guys can agree or disagree. What I was going to say is I think this restores people’s faith in science. And even as I’m speaking there are probably people who are like, no it doesn’t. But, you know, like, we basically got bailed out of a horrible pandemic by the insanely effective scientific community that came up with vaccines in very, very short order. And they turned out to be better than I expected it to be. And so, I don’t know, part of me thinks that this kind of global cooperation around in the scientific community to solve big problems, hopefully, is something that people realize.

And of course, I think most people probably couldn’t explain what public health was five years ago. I think people have a much, much better sense of it now. And one of the narratives is that we’re going to have to make investments in it and take care of it, just the way we do national defense, the way we think about the environment, about things that really have collective impact, large-scale impact, and are not just about individual choices.

RENEE DIRESTA: Well, I appreciate the thought-provoking and provocative responses. I tend to agree, actually. I think that ultimately this is also precipitating really material changes in how platforms think about harms, how inter-disciplinary research teams have come together to think about how information spreads, the ways in which we think about the restoration and building of trust. I think that there’s a lot of really foundational societal questions that this pandemic has prompted deep thought on.

So I’d like to thank you for chatting with me today. I think we are out of time. And I’m going to turn it back over to Graham to lead us into the next session.

ASHISH JHA: Thank you.

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