Political risk must-reads
By Ian Bremmer
Eurasia Group’s selection of essential reading for the political risk junkie — presented in no particular order. As always, feel free to give us your feedback or selections by tweeting at us via @EurasiaGroup or @ianbremmer.
The economics of people on the move
“Immigration Is Changing Much More Than the Immigration Debate” — Ben Casselman, FiveThirtyEight
As the U.S. deals with the recent spike in child migrants, immigration from Asia has surpassed immigration from Latin America in recent years. How can we explain the disconnect between perception and reality in the country’s immigration debate?
“The real reasons U.S. banks are getting out of the remittances business” — Tim Fernholz, Quartz
Banks are retreating from the remittance-transfer business, in part due to increased risk and regulation. But the biggest reason? Shrinking profit margins. Non-banking competition has pushed the cost of transferring funds from 7.21 percent of sum five years ago, to 5.78 percent this year.
“Out of Africa: Mobile phone banking surges in EM” — Irene Madongo, Financial Times
In an effort to reach the estimated 2.5 billion “unbanked” people living throughout the developing world, the amount of live mobile-money services increased 22 percent from 2012 to 2013. In at least nine African countries, there are more mobile-money account holders than traditional bank customers. But this is no longer just a Sub-Saharan story: services are rapidly expanding into Latin America as well.
“Immigrants From Latin America and Africa Squeezed as Banks Curtail International Money Transfers” — Michael Corkery, New York Times
In 2012 alone, Mexico received $51.1 billion in remittances from the United States. But a U.S. crackdown on the financing of terrorist and drug trafficking activities has been driving banks to scrap their low-cost money transfer services. How will this affect the future of remittance payments to Latin America and Africa?
“The High Stakes of Putin’s New Passport Policy” — Artem Nikitin, Kommersant via Worldcrunch
The economies of Tajikistan and Kyrgyzstan rely on remittances from Russia for over 30 percent of their GDP. Meanwhile, 3.3 million Ukrainians visited Russia last year, most of them for work. How will Russia’s push for new passport requirements affect its neighbors?
China as a heavyweight
“Why China Will Reclaim Siberia” — Frank Jacobs, New York Times
Along the Sino-Siberian border, 6 million Russians face nearly 90 million Chinese. Despite Moscow’s claim that “The earth along the Amur was, is and always will be Russian,” it’s not inconceivable to imagine China reclaiming a territory it lost only a century and a half ago. For socioeconomic reasons, Siberians might even be more at home under Beijing’s sphere of influence.
“There’s No Partnership in Pivot” — Stephen M. Walt, Foreign Policy
If the U.S. truly pivots to Asia, it may have to do so without its biggest ally: Europe. China is now the EU’s second largest trading partner, a large source of FDI, and a loyal arms customer. What does a rising China mean for the traditional Trans-Atlantic partnership?
“China Rethinks the Death Penalty” — Mara Hvistendahl, New York Times
It is widely believed that China legally executes more people annually than the rest of the world combined. The Supreme People’s Court’s recent decision to overturn the death sentence of a woman who murdered her husband signifies a change in the communist regime’s policy. Is the state becoming more merciful, or simply evolving to reflect popular Chinese opinion of capital punishment?
“Isis mobile wallet changes name to end confusion with Islamic State” — Middle East Eye
Islamic State of Iraq and the Levant (ISIS) has made headlines by declaring a caliphate and simplifying its name to “Islamic State.” Isis Mobile Wallet, a mobile payments app backed by AT&T, T-Mobile, and Verizon, will follow suit with their own rebranding strategy.