In fact, the body of data and assessments collected for the Bertelsmann Transformation Index 2008 show that leaders and decision makers in 70 of the 125 countries examined are striving for democracy and a market economy. But the BTI’s country reports also indicate that many of the world’s young democracies are not living up to their citizens’ expectations. All too frequently, newly elected governments exploit both their mandate and office for personal gain. They tolerate dramatic social disparities, capitulate to the demands of powerful interest groups, and fail to break free of sclerotic traditions. This failure of leadership enhances the attractiveness of competing models, as evidenced by the success of populist electoral campaigns in Latin America or the emboldened confidence of authoritarian and economically successful regimes in Asia and the Gulf region.

The dollar’s value in international exchange has been falling since early 2002. Over this five year span, the currency, on a real trade weighted basis, is down about 29%. For most of this time the dollar’s fall was moderately paced at about 3.0% to 4.0% annually. Recently, however, the slide has accelerated, falling nearly 10% between January and December of 2007. An acceleration of the depreciation brings the periodic concern of an impending dollar crisis to the fore. There is no precise demarcation of when a falling dollar moves from being an orderly decline to being a crisis. Most likely it would be a situation where the dollar falls, perhaps 15% to 20% annually for several years, and sends a significant negative shock to the U.S. and the global economies. This crisis may not be an inevitable outcome, but one that likely presents considerable risk to the economy.

Each Year, Global Economic Prospects explores critical “here and now” economic developments that are relevant to low- and middle-income countries. Past editions have examined the economic implications of international and regional trade liberalization, and migration and remittances. Last year’s report looked at the recent acceleration in growth among developing countries and its sustainability over the longer term. This year we take a closer look at technology, a critical determinant of sustainable growth and poverty reduction. We do so by directly measuring the extent to which countries use technological inputs (including scientific technologies embodied in goods and services and business processes) and produce technological outputs. The report also examines trends in the major channels through which technology is transmitted internationally, and in the country-specific factors that determine how well it is absorbed domestically.

Afghanistan has now laid the foundation for a market-based economy. A new economic system, based on the state as a regulator, not a producer, of goods, with a clear separation between the public and private sectors, stands in place of the centralized economy of the past. An independent central bank, a liberalized foreign exchange system, and laws permitting foreigners to wholly own property characterize the new economic landscape. A doubling of the gross national product and per capita income, a 13 percent growth rate in 2007, and modest inflation paint a vibrant picture.

President Vladimir Putin turned Russia's parliamentary election into a referendum on himself—and won by a landslide. But while he refuses to spell out his plans for remaining in power once his second term expires next spring, his economic policy is clear.

The US economy faces significant risks over the coming period. Developments in the financial and housing markets raise the specter of a sharp turndown or even a recession. High energy prices and the falling dollar, in the context of nearly full employment, trigger concerns about inflation as well. The current course for US policy, including fiscal policy per the mandate of this Committee, is thus much more complicated than usual.

As in his first inauguration address to parliament in 2000, Bashar Asad's speech after being sworn in for a second term in July 2007 also made detailed reference to the economic sphere. Citing statistical data published by the International Monetary Fund (IMF), Asad enumerated a series of economic achievements made possible, he maintained, thanks to the reforms implemented by his regime.

China's stock market has risen at a delirious rate during the past two years, forming a substantial bubble in the country's equity markets. Since PINR first noted this trend in February, the bubble has only grown -- although there have been some short-lived downturns -- and with it so have the risks inherent in allowing this unsustainable trend to continue.

The failure of the US and Europe to make concessions on farm tariffs and subsidies is the biggest obstacle holding up a successful conclusion of the Doha trade round, Bo Xilai, China’s commerce minister said Monday.

Initiatives to reduce transatlantic trade barriers or to harmonize trade-related domestic policies in the EU and the US appear regularly on the agenda of policy makers. The last decade saw also considerable steps in transatlantic economic cooperation focusing on special aspects. In February 2002, a new call for a study on the benefits of a transatlantic free trade area (TAFTA) was made by the President of the EU Council to facilitate further liberalization schemes. This article examines recent developments in transatlantic economic policies, discusses changes in approaches in transatlantic regionalism and presents estimates of the economic consequences of transatlantic liberalization. Given the expected small benefits of a TAFTA and the induced costs for multilateral liberalization negotiations, the article discusses alternatives to TAFTA and argues for a multilateral approach, eventually being accompanied by some sort of open regionalism.

La propuesta de crear un Área Atlántica de Prosperidad abierta, tal y como se describe en este libro, es el camino adecuado para reforzar los lazos atlánticos en el campo de la economía. Los ciudadanos europeos y estadounidenses se verían beneficiados por el incremento del comercio y las inversiones, el refuerzo de la competencia, mayor innovación y mayor productividad, que se traducirían en un aumento sustancial y permanente del bienestar a través de un crecimiento más elevado y más puestos de trabajo. La Unión Europea sería la mayor beneficiaria de estos logros. El resto del mundo también se beneficiaría de esta iniciativa, de manera directa, aceptando la oferta de unirse y, en todo caso, de manera indirecta, a través del incremento de la prosperidad de los motores de la economía mundial.

The German leader argued for closer cooperation between the EU and US. "I feel it is very important that trans-atlantic economic relations are intensified," she said in her speech, where she called for negotiations about non-tariff barriers such as technical standards and financial market regulations.

The US likes Merkel's calls for close trans-Atlantic trade ties -- but says it will have to deal with other issues first.

According to econometric studies, economic freedom and its improvement increase growth rates.1 But their effects are dominated by the effects of the level of economic development and human capital. Do these findings imply that defenders of capitalism and economic freedom exaggerate their case? Not at all.

La fundación FAES ha presentado el Índice de Libertad Económica elaborado por The Heritage Foundation, The Wall Street Journal, donde el catedrático de Economía Aplicada, Francisco Cabrillo ha afirmado que aunque el informe arroja una visión "optimista" a nivel global, España, que ocupa un puesto 27 a nivel mundial, obtiene bajas calificaciones en presión fiscal, gasto público y mercado laboral. Además Carlos Rodríguez Braun, catedrático de Pensamiento Económico en la Universidad Complutense ha dicho que los tres países “más odiados por los progresistas” -Estados Unidos, Gran Bretaña e Israel- son, “paradójicamente” los que tienen las economías más libres de sus respectivas zonas geográficas.

The US and European Union could set a date for the creation of a transatlantic trading zone at a summit in April, diplomats say. The idea of harmonising rules and regulations between the world's biggest economies to boost growth has gathered momentum since Angela Merkel, the German chancellor, em-braced it in January.

With city-dwellers now earning 3.2 times what rural residents do, workers are demanding more rights—and Beijing is starting to worry.

The 6th Plenum of the 16th Central Committee of the Communist Party of China (CPC) concluded on October 11, 2006 with the passage of a resolution to establish a harmonious society by 2020. The obvious implication from this commitment is that the present major social, economic and political trends within China might not lead to a harmonious society or, at least, not lead to a harmonious society fast enough.

Trade with the developing world could be hit hardest if Doha fails.

Ecuador has issued a post-dated promise to honour the $135m due tomorrow on its bonds. But even though the month-old government may pay this time around, a new senior creditor has been seated at the table in the negotiation of troubled sovereign debt.

La firma de consultoría Ernst & Young estima que Turquía es un “gigante dormido” en relación con las posibilidades de mejora de la inversión extranjera directa (IDE) en el futuro.

Brasil y Estados Unidos esperan tener lista a finales de 2007 una propuesta común sobre los parámetros de producción de etanol, indicaron este martes portavoces oficiales.

El presidente de EEUU, George W. Bush, dijoque apelará al Congreso para que apruebe el TLC con Panamá y prometió que su gobierno trabajará "de buena fe" para finalizar el acuerdo, tras una entrevista con su par panameño, Martín Torrijos.

As they regain control of Congress, Democrats should remember that a combination of education, saving, social insurance, and progressive taxation would allow the engine of economic growth to continue humming -- while still providing better protection to America's working families.

In the public debate, the use of Sanctions seems to be viewed predominantly with scepticism. States, however, time and again seek refuge in these measures.

Why are China and India growing so fast? Because of the global economy itself. Sustained high growth in developing economies is a post–World War II phenomenon. Using GDP figures, I take “high” to mean above 7 percent and “sustained” to mean 25 years or more. These cutoffs are arbitrary, but a similar picture emerges with variants. Growth at these rates produces very substantial changes in incomes and wealth: income doubles every decade at 7 percent.

At the heart of most economic or business scenarios is the assumption that globalisation will continue to be the dominant force shaping the world economy. Sometimes, as an extreme alternative, the possibility of a large-scale collapse of the process is also canvassed. The most likely alternative to the business-as-usual scenario, however, is for a change in the nature of the global policy environment to one that is less globalisation-friendly, such that instead of simply facilitating ever deeper international economic integration, policy tries to either slow or modify the process.

For many years, the United States and its European partners were the unchallenged global economic leaders. They not only created the major international economic institutions but also represented the bulk of the wealth behind them. But traditional transatlantic economic leadership faces challenges on several fronts. Emerging economies last year for the fi rst time ever surpassed the developed world in the total size of their national products – and they make up the lion’s share of total global growth. At the same time, globalization has eroded western governments’ control over their own economies, making them increasingly vulnerable to economic forces outside their borders. The power of “nonstate actors” has grown – capital markets, multinationals, hedge funds, and private equity.

En 2006 continuó la tendencia ascendente de la inversión extranjera directa (IED) que ingresó a América Latina y el Caribe (excluidos los principales centros financieros). El volumen de dicha inversión superó los 72.000 millones de dólares, cifra que representa un incremento del 1,5% respecto de 2005. Al mismo tiempo, cabe señalar que la participación de la región en los volúmenes de IED mundiales se redujo, ya que estos registraron un aumento mayor en el resto del mundo. En 2006 la situación en cuanto a las salidas de inversión extranjera directa (IED) fue muy singular, dado que en los países de América Latina y el Caribe los volúmenes aumentaron un 115%, para acercarse a los 41.000 millones de dólares, lo que señala un incremento mayor que en el resto del mundo.

For over 40 years, the United States has relied on unilateral trade preferences to promote export-led development in poor countries. Congressionally authorized trade preferences give market access to selected developing country goods, duty-free or at tariffs below normal rates, without requiring reciprocal trade concessions. The Caribbean Basin has benefitted from multiple preferential trade arrangements, the best known being those linked to the Caribbean Basin Initiative (CBI) begun in the mid-1980s. Since then, the growing number of reciprocal U.S. free trade agreements (FTAs) in the region have effectively replaced preferential trade arrangements, signaling a shift in U.S. trade policy and raising questions with respect to the future of those mostly smaller countries still relying on trade preferences. This report discusses the evolution of U.S. trade policy toward the Caribbean, focusing on the implications of moving from unilateral tariff preferences to reciprocal FTAs.

The Arab League, an umbrella organization comprising 23 Middle Eastern and African countries and entities, has maintained an official boycott of Israeli companies and Israeli-made goods since the founding of Israel in 1948. The boycott is administered by the Damascus-based Central Boycott Office, a specialized bureau of the Arab League. The boycott has three tiers. The primary boycott prohibits citizens of an Arab League member from buying, selling, or entering into a business contract with either the Israeli government or an Israeli citizen. The secondary boycott extends the primary boycott to any entity world-wide that does business in Israel. A blacklist of global firms that engage in business with Israel is maintained by the Central Boycott Office, and disseminated to Arab League members. The tertiary boycott prohibits an Arab League member and its nationals from doing business with a company that deals with companies that have been blacklisted by the Arab League.

We have agreed on a policy agenda to promote a smooth adjustment of global imbalances which should take place in the context of sustained robust global economic growth. We have taken stock of the progress made to date and discussed further challenges lying ahead. Our agenda builds on discussions at the IMF and other international fora. Open markets and competition are crucial elements, as are our efforts to promote freedom of investment and the dynamics of innovation described hereafter.

Led by the surging Chinese and Indian economies and supported by solid performance in most industrial and emerging-market countries, world real GDP growth reaccelerated to over 5 percent in 2006. With a significant slowdown now apparent in the US economy and with most of the rest of the world economy operating at near, or even somewhat above, potential, some slackening in the pace of global economic advance—down to about 4½ percent—is now virtually certain for 2007 and 2008. The danger of entering recession over the next year or so has gone up in the United States to roughly double its normal level but does not exceed Alan Greenspan’s recent suggestion of only about a one-third chance. A mild bout of stagflation is a more likely prospect. Elsewhere in the world, there is also some concern about a modest pick up in core inflation, but there is less reason to worry, at least so far, about a substantial economic slowdown. Thus, all things considered, there is reason for optimism that the current global economic expansion that has sustained a remarkable four consecutive years of better than 4 percent real growth will continue for at least another two years.

As President Bush prepares to depart for a six-day trip to Brazil, Uruguay, Colombia, Guatemala, and Mexico, many are hopeful that the President' s most extensive trip to Latin America signals the Administration's desire to refocus on issues of importance to the Western Hemisphere. The vacuum left by a lack of leadership in the region has resulted in the rise of radical populism and the deterioration of democratic institutions in a number of nations. The White House appears mindful of the importance of this trip, declaring that the President's mission is "to reinforce the common bonds that we share with our Latin American neighbors and to communicate an agenda to advance freedom, prosperity, and social justice and deliver the benefits of democracy in the areas of health, education and economic opportunity."

Commercial diplomacy is a significant factor in the on-going process of globalization, yet there is a shortage of empirical research on this activity. It identifies three dominant types of commercial diplomats: civil servant, generalist and business promoter.

This monograph analyzes the political impact of the rapidly growing economic relationship between the People’s Republic of China (PRC) and Taiwan and evaluates the prospects for Beijing to exploit that expanding economic relationship to employ economic coercion against Taiwan. It also identifies China’s goals for applying economic pressure against Taiwan. To establish a framework for evaluating China’s relative success or failure in using economic coercion against Taiwan, this work draws upon the conclusions of the large and empirically rich body of studies of economic diplomacy that have focused on economic coercion and trade sanctions.

One of the unusual developments in China’s foreign relations and Asian economy in recent years is that China, as still a developing country, has been actively pushing for free trade areas/arrangements/agreements (FTA) in Asia and the world. In just the few years since 2001, it has been busy suggesting and engaging in FTA talks and negotiations with a number of countries. It has signed a basic agreement with ASEAN (Association of Southeast Asian Nations) and has also engaged in serious negotiations with Australia to set up an FTA, and has begun talks with New Zealand. In Northeast Asia, China suggested an FTA arrangement among itself, Japan, and the Republic of Korea (ROK), and those three major economies have established a joint committee to study the possibility. At the same time, China has proposed FTA arrangements with the Shanghai Cooperation Organization (SCO) members: Russia, China, Kazakstan, Kyrgystan, Tajikistan, and Uzbekistan. China and Middle East countries have also expressed their willingness to consider establishing FTAs. Farther away, China has even proposed FTAs with Brazil and other Latin American countries.

Le président Vladimir Poutine s'est félicité jeudi des importantes ventes d'armes de la Russie en 2006, d'un montant de six milliards de dollars, qui font de la Russie l'un des premiers vendeurs d'armements au monde. “Cette année, nous atteignons les six milliards de dollars” pour les ventes d'armes, a déclaré Vladimir Poutine lors d'une réunion retransmise sur la première chaîne russe.

Two weeks ago, European Commissioner of Competition Neelie Kroes arrived in the United States on a mission of economic cooperation. Increasingly, however, that cooperation is hard to find, especially for American firms doing business in Europe. More often than not, the European vision of cooperation is capitulation, with American companies forced to accept onerous conditions or else abandon the European marketplace altogether.

The world’s weakest states are poor states that lack the capacity to fulfill essential government functions, chiefly: 1) to secure their population from violent conflict; 2) to competently meet the basic human needs of their population (i.e. food, health, education), and; 3) to govern legitimately with the acceptance of a majority of their population. The Brookings-CGD project defines weak states as poor states that suffer from significant “gaps” in security, performance and legitimacy. We classify states as “weak” if they meet the “low income” standard and exhibit “gaps” in at least two of the three fundamental government functions. This paper identifies fifty-two weak states in the world, and expounds on the multifaceted reasons this weakness poses a global security challenge. These states are high-risk zones that in a rapidly obalizing world may eventually, often indirectly, pose significant risks to far-away countries.

Trade Organization’s (WTO) Doha Development Agenda or “Round” of global trade talks, launched in Doha, Qatar, in November 2001, a “once in a generation opportunity” to expand trade. President Bush has identified their success as his administration’s top trade priority. Due to various U.S. notification and consultation requirements, concluding the negotiations in 2006 is essential for a Doha agreement to qualify for congressional consideration under U.S. Trade Promotion Authority (TPA), which expires July 1, 2007. A ministerial meeting among the WTO’s 149 members was held on December 13-18, 2005, in Hong Kong, China, to make decisions needed to advance the talks.