http://iorj.hse.ru en-us Copyright 2018 Fri, 07 Dec 2018 17:02:24 +0300 https://iorj.hse.ru/en/2018-13-4/228932298.html The legitimacy of the Group of 20 (G20) is frequently challenged: the group has been criticised by non-member states, non-governmental organisations (NGOs) and in both the scientific and broader public debate with regard to the content and effectiveness of its policy measures and its limited membership structure. Accountability mechanisms can attenuate these shortcomings in different ways: they can increase the capacity of the citizens of the member states to surveil the activities of the G20 and can form the basis of learning processes within the group so as to increase effectiveness. In addition, accountability mechanisms directed towards non-member states can make the G20 more receptive to the interests of people who do not live in its own countries but are nevertheless affected by the policies of the G20. In this paper we analyse the existing accountability mechanisms of the G20 and discuss the challenges that the adoption of the 2030 Agenda for Sustainable Development as a guiding framework for G20 work poses to them. While the G20 also constitutes a platform for the reciprocal accountability of its individual member countries, our focus lies on the accountability mechanisms of the institution of the G20 as a whole. Based on the literature, we can identify three elements of accountability: transparency, justification, and enforcement. The institutionalised accountability mechanisms of the G20 are primarily directed at the first two elements of accountability, as the G20 ¬¬¬– like all club governance institutions is not subject to any formal sanctioning mechanisms. However, besides being valuable in their own right, transparency and justification make weaker forms of sanctions such as criticism by independent agents as well as reputational effects possible. The most prominent accountability mechanisms of the G20 are its interaction with the media; the publication of accountability reports; and a dialogue process with the so-called Engagement Groups from civil society, business, and academia. In the end, these mechanisms are intended to render the G20 accountable to the citizens within and outside G20 countries (either directly, or mediated by other agents). At the same time, however, they sometimes also fulfil an additional function for the G20 itself, namely tracking its own work towards its commitment to learn from past experiences.In 2015, the international community adopted the 2030 Agenda for Sustainable Development as a universal development agenda. The G20 assumed the principles of the 2030 Agenda and a special responsibility for its implementation through its 2016 G20 Action Plan on the 2030 Agenda for Sustainable Development. Thereby, new challenges for accountability in the G20 have arisen. When looking towards the future, several suggestions for the G20 can be raised in order to increase its accountability, particularly in light of the demands set by its role in the implementation of the 2030 Agenda. To increase the credibility of its accountability processes, it is necessary to allow for more independent evaluation. For this to be possible, the work of the G20 must become first and foremost more transparent. Possible ways to achieve this range from the establishment of a permanent website, over allowing selected civil society members to attend its working group meetings, to publishing agendas, minutes and issue notes. Self-reports should best be concentrated on descriptions rather than selfevaluation. In order to allow for coherent reporting on the 2030 Agenda, one central report should overarchingly cover all relevant G20 actions in the so-called Sustainable Development Sectors (SDSs) of the G20 Action Plan on the 2030 Agenda for Sustainable Development (and its 2017 Hamburg Update). Comprehensive reporting on joint actions taken by the G20 could complement the United Nations follow-up process for individual countries. If given sufficient access to the relevant information, Engagement Groups such as the T20 (Think 20) could play a vital role in providing credible and informed independent evaluation of G20 policies. This would be a particularly promising way forward in the context of the 2030 Agenda, as the agenda will require common efforts by both policymakers and society for its successful implementation. Improving on its existing system of accountability mechanisms cannot fully compensate for the lack of legitimacy that is associated with the exclusionary institutional set-up of the G20. Yet establishing “streamlined, coherent, and credible” accountability processes (G20, 2016, p. 15) could prove to be a key element in addressing its legitimacy problems. https://iorj.hse.ru/en/2018-13-4/228932407.html  The Group of 20 (G20) broke onto the global scene shortly after the bankruptcy of the financial giant Lehman Brothers, which until then had been the fourth-largest investment bank in the United States with a 158-year long history. On 15 September 2008, the world witnessed the unthinkable. The international financial system was crumbling from within and traditional policy tools were unable to stop the fall. Since mid-2007, the collapse of housing prices and the implosion of the subprime mortgage market bubble had generated a wave of bankruptcies in the financial sector in the United States and Europe. In October 2008, both the TED spread indicator, which accounts for the level of stress in the U.S. banking sector, and the Emerging Market Bond Index (EMBI) Global spread index, which reflects the combined risk of 61 emerging markets, reached their historic peaks [IMF, 2017]. The message was clear: the financial crisis was not easing and the risks of global contagion were already being felt. It was then that President George W. Bush, in the final months of his second term, decided to convene a summit of the heads of state of the main global economies. Reflecting the emerging multipolar order, in particular the rise of China, Bush issued invitations to his peers among the G20. The exclusive Group of 7 (G7) at the table of global governance — comprised of the main advanced economies — was thus expanded to include the largest emerging economies as well.[1] The G20 is comprised of nineteen national economies, plus the European Union, that are considered “systemically important” and that together account for more than 80% of global product, 75% of international trade and 66% of world population. Since 1999, the group had operated as a technical forum for financial coordination between finance ministers,[2] but in November 2008 the first G20 leaders’ summit took place in Washington DC. The presidents of the three largest Latin American economies — Argentina, Brazil and Mexico — participated in this inaugural summit. In the decade that has passed since that first meeting, the leaders of the G20 have met a total of 12 times, and plan to do so again in November 2018 in Buenos Aires under the annual (rotating) G20 presidency of Argentina. Previously, Mexico had hosted the leaders’ summit in Los Cabos in 2012 and Brazil had served as the G20 coordinator in 2008 during the transition from a ministerial forum to forum for heads of state. This article explores the role and main contributions of the three Latin American economies in the G20 during the last decade, focusing in particular on the continuities and ruptures in the regional agenda towards the forum. With this goal in mind, the analysis begins with an overview of the metamorphosis of the G20 during its first decade. Then, the specific Latin American path is explored. The article closes with a brief presentation of an alternative approach and agenda for the G20. https://iorj.hse.ru/en/2018-13-4/228932694.html This article examines the phenomenon of the BRICS grouping of Brazil, Russia, India, China and South Africa from the perspective of several theories of international relations; in particular, power transition theory, soft power and peaceful coexistence concepts, the theory of “global regionalism” and status theories are reviewed. Each explains both the BRICS phenomenon and the role of this integration association in the present-day international relations system. It is concluded that, depending on research objectives and the way it is applied, each theory — despite limitations – has explanatory power. Together they create an interdisciplinary basis for studying complex phenomena such as the BRICS.A number of modern theories hold that, along with the pursuit of purely material and pragmatic interests, the BRICS countries actively use this integration association to strengthen their positions in the world arena and elevate their international status.It is also concluded that the BRICS succeeded in creating an image of an alternative model of world order based on the principles of cooperation, mutual respect and balance of interests, rather than mandate, discrimination and hierarchy. It is premature to make a statement that a principally new type of interstate relations or an international institution has been created within the BRICS framework. At the same time, it is also certain that some positive experience has already been accumulated in the framework of this forum, and that this association offers good prospects for the future. For this reason it is of considerable interest for international relations theory. https://iorj.hse.ru/en/2018-13-4/228932758.html This article explores the formation of multilateral dialogue among the BRICS grouping of Brazil, Russia, India, China and South Africa to address the problems of development quality based on the most demonstrative sphere of the countries’ economic cooperation — mutual trade.The foreign policy contour of the BRICS dialogue is a shared responsibility and stems from national obligations within the United Nations (UN) system, the World Trade Organization (WTO) and other international fora. As it connects with development strategies in different environments and at different paces, the convergence of the positions taken by BRICS members both within and outside the forum is in line with their domestic economic priorities, and hence multilateral cooperation mechanisms are included in national development plans. The external economic contour poses similar restrictions on internal development — agricultural and manufacturing industries based on the exploitation of natural resources, the use of dirty fuels, ecologically intensive exports and the general need to preserve and restore the resource base.Analytically, this study is based on the quantitative parameters of intra-BRICS trade from 2009–2017, the BRICS export resource-intensity indicators and non-tariff restrictions statistics. Maintaining relatively similar and generally low tariffs in raw materials sectors, BRICS countries regulate the turnover of “green” goods within the group through technical barriers, price control measures and quality standards, maintaining a consistently high share of environmentally intensive raw materials. At the same time, given the differentiation of BRICS countries in terms of quality of growth and sensitivity to external shocks, some of them seek to diversify their exports (oil and petroleum products from Russia and China), while others protect local producers (agricultural products from Brazil and Russia), and take “green economy” measures as a substitute for higher tariffs for environmentally friendly goods to help retain markets. https://iorj.hse.ru/en/2018-13-4/228932816.html The sustainable development goals (SDGs) adopted in 2015 by the United Nations (UN) in the 2030 Agenda for Sustainable Development collectively serve as a universal guide for developed and developing countries in their national policies and international cooperation aimed at combating global challenges. The SDGs build on the outcomes of the Global Partnership for Development Co-operation (GPEDC), the foundations of which were laid in the 20th century. This article explores the system of international development cooperation as it evolved in the UN from 1946 until the adoption of the UN Millennium Declaration in 2000. It analyzes the resolutions and official records of the main UN bodies, with emphasis on the General Assembly (GA) and the Economic and Social Council (ECOSOC). Content analysis of the records reveals the delegations’ positions, interests, contradictions and tensions which may have been concealed by the smooth text of the resolutions.Four development decades culminated in adoption of the Millennium Declaration. Each stage had its achievements and problems. The main principles, mechanisms and areas of cooperation were molded in early sessions of the GA and ECOSOC. The creation of development support instruments began in mid-1940s, when the World Health Organization (WHO), the United Nations International Children’s Emergency Fund (UNICEF), the Food and Agriculture Organization (FAO), the Expanded Programme of Technical Assistance (EPTA) and later the UN Special Fund were established. The dollar monopoly was entrenched. The expansion of international trade and removal of barriers to trade issues gained prominence in UN resolutions in the 1950s. In 1960 the goal of increasing flows of assistance and capital to developing countries to 1% of the combined national incomes of economically developed countries was set for the first time.The period from 1961–1970 was marked by the adoption of the Programme for International Development Co-operation — including the First United Nations Development Decade and the World Food Programme (WFP), the establishment of the UN Industrial Development Organization (UNIDO) and the UN Conference on Trade and Development (UNCTAD), and by the elaboration of the international development strategy for the second development decade. The need for international monetary reform was debated in conjunction with the UN’s pursuit of a solution to the problems of rising debt and international liquidity.The key milestones of the second decade include the gradual integration of development and environment issues, efforts to resolve the international monetary crisis and alleviate the rising debt burden, an increase of pledged targets for the UN Development Programme (UNDP), the WFP and Special Fund, the decision on the Charter of Economic Rights and Duties of States, efforts to implement the differential treatment principle with regard to developing countries within the General Agreement on Tariffs and Trade (GATT), adoption of theInternational Development Strategy for the Third United Nations Development Decade, and a failed attempt to launch “global negotiations on restructuring of international economic relations on the basis of the principles of justice and equality in order to provide for steady economic development.”In the third decade, progress was made toward strengthening the science and technology capacity as well as the industrial and resource development capacity of developing countries. The UN endorsed the Global Strategy for Health for All by the Year 2000, adopted the Declaration on the Right to Development and theInternational Development Strategy for the Fourth United Nations Development Decade. The transition to a sustainable development model was a major achievement. The economic recession,high rates of interest, inflation and mounting deficits, the problems of liquidity and balance of payments, protectionism and structural imbalances in the world economy required a comprehensive decision on the reform of the international monetary system. However, global negotiations were deadlocked due to the position taken by the Group of 7 (G7) that the independence of the specialized agencies such as the International Monetary Fund (IMF), the World Bank (WB) and the World Trade Organization (WTO) should be guaranteed. Despite efforts by the Group of 77 (G77) to deal comprehensively with thefull range of economic issues, the G7’s insistence on the 1982 Versailles summit formula blocked global negotiations, definingthe system’srigidity for many years to come and contributing to its failure to prevent the 1998 and 2008 crises.The Agenda for Development adopted in June 1997 and the UN Millennium Declaration adopted in September 2000 became the landmarks of the fourth decade and development cooperation history.The international community came a long way in building and consolidating development cooperation in the second half of the 20th century. The UN became a cradle and a driver of this process and was a factor in its success. Indisputable achievements resulting from collective efforts over 55 years include a consistent consolidation of its foundational programme documents from the first development decade to the Millennium Development Goals (MGDs), continuous improvement of the review and appraisal process, integration of environmental issues into the development agenda, establishment of key development cooperation institutions and a significant increase in financing for development. However, efforts to create the conditions for sustained progress and development restructuring of the international economic system taking account of the interests of developing countries failed. The 21st century inherited the systemic problems of the international monetary and trade systems. https://iorj.hse.ru/en/2018-13-4/228932946.html  Despite widespread agreement among international organizations on the importance of healthy early childhood development, monitoring of national action on the provision of pre-primary education has been limited. This paper presents a quantitative approach to monitoring the world’s progress on the United Nations (UN) sustainable development goal (SDG) target 4.2 to “ensure that all girls and boys have access to quality early childhood development, care and pre-primary education.” A rigorous approach was used to create a new quantitative globally comparable database of indicators for policies that mandate the provision of national pre-primary education for 86% of UN member states. This dataset was analyzed to examine global inequalities in the provision of universal pre-primary education and revealed that 43% of countries, and only 3% of low-income countries, provide tuition-free pre-primary education. Just under 25% of countries offer tuition-free pre-primary education for two or more years. This contrasts sharply with primary education, which is provided tuition-free in 96% of countries. To illustrate how this data can contribute to the examination of the relationship between policy and outcome, it is used in a regression analysis. Additional global data collection on the quality of pre-primary education would further enhance efforts to monitor policies that play key roles in the fulfillment of target 4.2, and support the achievement of the United Nations sustainable development goal on education. https://iorj.hse.ru/en/2018-13-4/228933215.html The 2030 Sustainable Development Agenda, adopted by the UN in September 2015, drew attention of the international community to the problem of finding resources to finance various initiatives and programs necessary to achieve the Sustainable Development Goals (SDGs). The availability of the required long-term financing from state budgets and multilateral development banks (MDBs) remains limited, and its structure is not optimal due to unstable market conditions and cyclical fluctuations in the global economy, as well as a number of long-term economic trends. At the same time, private investment, primarily from the largest institutional investors, could become another important source of additional financing for development, which could partially compensate for the abovementioned deficit.Given that, on the one hand, private investors have considerable funds, which they are not inclined to invest in infrastructure development for various reasons, and on the other hand, MDBs’ investment in this sector remain limited, despite their vast experience and unique institutional characteristics, demand has increased for multilateral banks to perform a more active role in developing and using new financial instruments, addressing information problems and providing their own financial resources, that is, co-financing projects with the private sector.This article examines the main approaches used by the MDBs to mobilize private investment, assesses their “major catalytic role” of co-financing with the private sector, and gives some recommendations on strengthening their mobilization role.According to the author, the data on direct private investment mobilization provided by MDBs indicate the need to expand the use of mobilization tools. In this regard, measures aimed at solving the main problems in this area - the limited MDBs’ resources and their conservative credit policy – seem to be the most promising. Among these measures are easing capital requirements for banks, optimization of “concessional windows”, and partial transfer of MDBs’ obligations to private investors, including through creating investment platforms and special funds. Although these mechanisms in various forms have already been adopted by key MDBs, given insufficient levels of mobilization, it is necessary to remove obstacles to their more active use. https://iorj.hse.ru/en/2018-13-4/228933464.html This paper discusses the results of a survey of multinational corporations with affiliates in developing countries. The paper explores corporate perspectives and decision making across the stages of the investment cycle: attraction, entry and establishment, operations and expansion, linkages with the local economy, and, in some cases, divestment and exit. Through interviews with 754 executives, the survey finds that political stability and a business-friendly regulatory environment are the top two factors influencing multinational corporations’ investment decisions in developing countries. Investors seek predictable, transparent, and efficient conduct of public agencies. The survey results also show that investors are heterogeneous, and their perceptions vary with motivation and size. Multinational corporations that are involved in efficiency-seeking investment are more selective than investors motivated by other considerations, and that relatively smaller multinational corporations are more sensitive to host country characteristics and investment climate factors than large firms. https://iorj.hse.ru/en/2018-13-4/228933645.html This paper is focused on the European development response to the refugee and migration crisis. European development aid was impacted by the refugee and migration crisis and appeared to be a tool to smooth the consequences of the crisis in Europe. The author conducted semi-structured interviews with scholars, policymakers and representatives of civil society and came to conclusion that the European Union (EU) and its members, instead of developing a strategic programme to resolve this structural issue, used a tactical solution to achieve the short-term goal of stopping migration. Short-term motivations prevailed over a long-term strategy and resulted in the politicization of development aid in policy papers: there was a significant change in the discourse regarding migration and development assistance. While EU members have indeed excessively used official development assistance (ODA) to host refugees in their countries, EU development programmes in African countries have been largely relabeled as “migration-related.” So far there is no evidence-based research that redistribution of aid beneficiaries has taken place as a result of the policy to tackle the “root causes” of migration.This paper first outlines the European policy framework on development assistance which is aimed at migration management. Then it identifies the EU initiatives to mainstream migration into the development agenda, and considers members’ use of ODA to cover domestic expenses for refugees and asylum seekers. The paper concludes by outlining the key concerns regarding instrumentalization of aid. https://iorj.hse.ru/en/2018-13-4/228933905.html Every dynamic social system’s adaptive capacity is finite. Eventually, the ability of the system’s legal and institutional arrangements to adapt to the changing operational context is exhausted. At this point, unless the system is significantly reformed, it begins losing its legitimacy and efficacy.This article contends that the structure, operation and scale of the global economy has changed so dramatically that the current arrangements for global economic governance are approaching this crisis moment. They are failing to deliver an inclusive, sustainable and efficient international economic system that can contribute to peace, prosperity and human welfare. Their governance arrangements and operating practices and procedures have not been adequately adapted to the new realities of the international political economy. Key institutions are only slowly adjusting their current decision-making practices to the fact that the balance of economic power among their members has shifted. They have also been slow in responding to the growing importance of such non-state actors as corporations, civil society organizations and subnational governments in the governance of the global economy.However, the political will to make the necessary changes to the institutional arrangements for global economic governance is lacking. This means that in the short to medium term, absent a serious crisis, there is limited potential for reform. However, this does not mean that opportunities for meaningful partial reforms do not exist. Those actors that are interested in reform need to carefully seek out those opportunities and, once identified, use them to make the system more participatory, accountable and responsive to the concerns to all stakeholders in the system. This in turn should enhance the capacity of the system to respond productively to future opportunities for more profound changes in global economic governance.In making this case, the article first briefly describes the key features of the order established after World War II. Second, it discusses some of the changes that these institutions have undergone over the past 70 years. Third, it discusses the adjustments that, in fact, have been made in global economic governance. It also indicates some ways in which opportunities for making the system more inclusive, responsive and accountable can be identified. Finally, it offers suggestions regarding possible changes within the current order and on the role entities like the Group of 20 and the BRICS grouping of Brazil, Russia, India, China and South Africa can play in promoting these changes.It should be noted that, due to space limitations, while this article discusses global economic governance in general, it concentrates primarily on the cases of the two most prominent institutions in global economic governance — the International Monetary Fund (IMF) and the World Bank Group (the World Bank). The reason for focusing on the IMF is that it is the most significant multilateral institution active in the governance of international financial and monetary affairs. The World Bank is an important funder of development activity even if it is not the largest such lender. It is the model that was used in setting up all of the regional multilateral development banks (MDBs) and it has had an influence on the structure and function of other MDBs as well, such as the Asian Infrastructure Investment Bank. It has also been a thought leader in the area of development finance. https://iorj.hse.ru/en/2018-13-4/228934363.html This article considers “soft” and “smart power” through the prism of current ideological concepts informing the foreign policy of the People’s Republic of China (PRC) — specifically, the “community of common destiny” and the “One Belt One Road.” The author argues that China is drawing on new theoretical approaches to strengthen its state power and its influence on strategic territories in Asia-Pacific and South East Asia. For the effective and efficient advancement of its national interests China has to overcome significant “path dependence” in the regional relations towards its policy.Chinese authorities clearly understand that it is impossible to achieve China’s goals without a significant presence in the socio-economic dimension of target countries and regions. In pursuit of this goal, China uses existing economic mechanisms (international trade and investment) and has also established new ones, including the Asian Infrastructure Investment Bank (AIIB) and the Economic Belt of the Silk Road/One Belt One Road/Belt and Road initiative. These mechanisms supplement the value dimension of Chinese policy.China is working to create an institutional system in which it can secure its influence and establish the conditions that will allow it to become a world leader in the future. Chinese authorities appreciate that, without a proactive strategy aimed both at the alleviation or elimination of path dependence and the establishment of a positive perception of its policies, the PRC will not succeed in strengthening its leadership. At the same time, the growing interdependence and interconnectivity between China and its foreign partners will increase the scope of opportunities for China to advance its national interests and reduce the likelihood of negative conduct towards China. https://iorj.hse.ru/en/2018-13-4/228935090.html The export of agri-food products from the European Union (EU) to Russia has been negatively influenced by the Russian embargo. The objective of this paper is to analyze the impact of the Russian agri-food embargo on EU agri-food exports to Russia from 2010 to 2016 and to consider the possibility of avoiding the embargo using Belarus as a re-exporting country. The revealed comparative advantage (RCA) index was used to assess the impact of Russian sanctions on agricultural exports from the EU to Russia.  The main consequence of the embargo was a significant decline in EU agri-food exports to Russia. European producers responded by trying to increase the territorial diversification of their customers. In the beginning, they tried to keep the Russian market through re-export operations, which is evident in the example of Belarus. Calculation of RCI points to the fact that mutual agri-food trade has changed significantly. Prior to the embargo, agri-food exports from the EU to Russia were  competitive, but these advantages have been lost. In 2010, Russia was the second most important agri-food market for the EU. However, as a consequence of the embargo, it dropped to fifth place in 2016. The paper also assesses the future development of agri-food trade between the EU and Russia based on a linear model. https://iorj.hse.ru/en/2018-13-4/228935176.html The review covers OECD report “The Productivity-Inclusiveness Nexus”. Modest global economic growth is closely related to lagging labour productivity caused by growing barriers experienced by economic agents in accessing markets and resources. The key massage of the report is a call for changing the economic growth model to more inclusive productivity growth that enables people invest on the skills and provides an environment where all firms have a fair chance to succeed. Inclusive economic growth model primary aims at improved living standards and opportunities for all parts of society, especially low income. This aim implies implementation of the package of structural transformations, the key idea of which is that acceleration in productivity growth should be supplemented by reduction of income inequality and ensuring that all individuals are equipped to fulfilling their productive potential. https://iorj.hse.ru/en/2018-13-4/228935340.html The review is focused on critical analysis of the monograph written by the French researcher O. A. Spaiser whose study wasfocused on EU policy in Central Asia. The reviewers pay attention to methodology which is used by the author with the purpose to analyze EU capabilities that are necessary to influence so distant region. At the heart of her work is the methodology of post-structuralism and post-modernism. This uncommon scientific approach helps to estimate effectiveness of EU policies in Central Asia and gives an opportunity to make judgments on the political agency of the Union as such. Reviewers positively assess Spaiser’s contribution to the European studies as her book is one of a few studies where doubts about universality of EU normative model where accurately made. In contrast to the European part of the post-Soviet space, where Brussels’ policy of Europeanization has some effect and brought benefits to EU as a player, in Central Asia EU normative influence on political life is quite limited.