Recommended Weekend Reads
The Latin American Nations are Best Positioned for Nearshoring, How America’s Gender Gap is Reshaping the Election, and Macroeconomic Limits of China’s Africa Strategy
October 18 - 20, 2024
Please find below our recommended reads from reports and articles we read in the last week. We hope you find these useful and that you have a relaxing weekend. And let us know if you or someone you know wants to be added to our distribution list.
Americas
Solving Latin America’s Food Paradox Americas Quarterly
Latin America has, in many ways, become the world’s breadbasket. Over the past two decades, the value of its agricultural exports rose a whopping 500% to $316 billion in 2022, the last full year data was available. No other region has a larger farming surplus. It is the source of more than 60% of the world’s soybean trade, almost half its corn, and more than a quarter of its beef. Three out of four avocados come from Latin America, as does much of the world’s coffee. At the same time, about 28% of people in Latin America and the Caribbean suffer today from moderate or severe food insecurity, meaning they lack regular access to enough safe and nutritious food for normal health and development. That number is down from its peak during the COVID-19 pandemic but still six percentage points higher than in 2014, according to the United Nations Food and Agriculture Organization (FAO). That means an additional 48 million people are suffering from food insecurity compared to a decade ago. What can be done?
China invites Colombia to Join the Belt and Road Initiative, “Exploring” Free Trade Agreement South China Morning Post
Colombia has confirmed formation of working group to discuss matter and hails ‘great potential’ to lure mainland investment, alarming US officials.
Which Latin American Countries are Best Positioned for Nearshoring? Brian Winter/Editor-in-Chief of Americas Quarterly
Winter posted a fascinating tweet showing a chart prepared by former Chilean Finance Minister Felipe Larraín showing which countries in Latin America are best positioned for nearshoring.
The U.S. Elections
The Politics of Progress and Privilege: How America’s Gender Gap Is Reshaping the 2024 Election American Enterprises Institute’s Survey Center on American Life
The United States is experiencing a tumultuous shift in how Americans recognize traditional gender hierarchies. Women still feel there is a significant need to address gender inequality, whereas many men are more ambiguous on the matter. Gen Z is particularly sensitive to the reassessment of these norms, with young men and women increasingly stratified along party lines. Young women are more likely to support Democratic candidates, take liberal policy stances, and believe that a more concerted effort is needed to ensure equality between the sexes. Young men, comparatively, have sorted in the opposite manner. With Gen Z increasingly at odds in their politics and social identities, the common ground between American men and women is diminishing rapidly.
China
Renminbi dilemma for Chinese authorities Mark Sobel/ OMFIF
China’s economy is being rocked by enormous headwinds – excess leverage, local government debt, housing sector woes, de/disinflation, contracting manufacturing and weak service sector growth. The authorities have announced measures to reduce interest rates, spur housing and boost equity prices. However, the fiscal pronouncements made over the past weekend – though apparently not directly aimed at boosting consumption –were lacking in details, terms and amounts. Together, these efforts, while helping to limit downside risks to the economy, are so far unlikely to restore confidence and significantly strengthen activity. Amid weak domestic demand and low confidence, how then might Chinese authorities view the renminbi?
U.S. – China Relations for the 2030s: Toward a Realistic Scenario for Coexistence Carnegie Endowment for International Peace
It has become difficult to imagine how Washington and Beijing might turn their relationship, which is so crucial to the future of world order, toward calmer waters. If there is to be any hope of doing so, however, a group of some of the leading policy experts on US China relations offer, via individual essays, a realistic vision of what those calmer waters might look like.
Value-added and Value Lost: The Macroeconomic Limits of China’s Africa Strategy European Council on Foreign Relations
China’s overcapacity has hit Europe’s economies hard, but it is also damaging Africa’s. With both continents suffering, Africa and Europe can make common cause in confronting this mutual challenge.
Geoeconomics
Immigration and Macroeconomy After 2024 Stan Veuger/Wendy Edelberg/Cecilia Esterline/Tara Watson
Few issues have dominated the US political debate in recent years like immigration. The starting point for our analysis is the creation of a “high immigration” and a “low immigration” scenario for each presidential candidate. These scenarios reflect a combination of the historical record under the Trump administration and the Biden-Harris administration, announced and inferred immigration policies, as well as our judgment of likely developments. They are constructed from the ground up, starting by predicting inflows from specific visa categories, border and parole policy, and entries without inspection. We also predict removals, reflecting both the candidates’ visions and logistical constraints as well as other factors that affect outflows. We provide two scenarios for each candidate given the considerable uncertainty about policy actions as well as responses by migrants.
Challenging the deglobalization narrative: Global flows have remained resilient through successive shocks Journal of International Business Policy
Abstract: We challenge the popular narrative that the world has entered a period of deglobalization, arguing that deglobalization is still a risk rather than a current reality. Drawing upon the DHL Global Connectedness Index, we show that international flows have not decreased relative to domestic activity, there is not an ongoing shift from global to regional business, and geopolitically driven shifts in international flows still primarily involve countries at the center of present conflicts. We propose policy and research implications, warning that misperceptions of deglobalization could themselves contribute to costly reductions in international openness.
The Great Transfer-mation: How American communities became reliant on income from government Economic Innovation Group
This interactive research report shows how transfers’ share of Americans’ total personal income has more than doubled over the past 50 years, from 8.2% in 1970 to 17.6% in 2022. They are the third largest source of Americans’ personal income, after income from work and investments. The average American received $11,500 in income from government transfers in 2022, compared to $40,500 in income derived from work and $12,900 from investments. Today, most U.S. counties depend on a level of government transfer income that was once reserved only for the most distressed places.