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Russia Suspends the New START Treaty

Author(s): Artur Kacprzyk / Language(s): English

Russia’s groundless suspension of the Russia-U.S. Treaty on Measures for the Further Reduction and Limitation of Strategic Offensive Arms (New START) is yet another attempt to intimidate the West with nuclear weapons. By threatening an arms race, Russia seeks to force concessions regarding Ukraine. It is unable, however, to gain meaningful strategic advantage over the U.S. in such a race. It would entail costs for both sides, but they would be more severe for Russia, which is much weaker economically and further weakened by war and sanctions.

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Politics prevails – Israel’s trade relations with the European Union

Author(s): Karolina Zielińska / Language(s): English

The European Union’s trade relations with Israel are asymmetrical, but the overall volume of their trade in goods and services has been growing rapidly. The EU is Israel’s top partner in this field, while Israel ranks outside the top 30 of the EU’s biggest partners; the EU has a positive trade balance with this country. This state of affairs has turned trade into a potential political instrument, but its assertive use by the EU with respect to the Palestinian issue has failed to bring about any change in Israel’s policy towards the occupied territories. Instead, Israel’s resistance to the EU’s policy on this issue has led to a freeze in the institutional development of trade relations, especially in the services and investment sectors. The EU and especially Israel could benefit from a further liberalisation in bilateral relations and its extension to their partners in the region, but political factors are hampering this process. Therefore, a breakthrough in the form of launching negotiations on an agreement to create a deep and comprehensive free trade area appears unlikely in the foreseeable future.

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“Next Generation EU”: Economic Recovery through Shared Debt

Author(s): Marek Wąsiński / Language(s): English

The new proposal for the 2021-2027 EU budget includes debt issuance by the European Commission (EC) to support economic recovery in the Union. The Next Generation EU mechanism aims to raise €750 billion from financial markets. However, the consent of all Member States will be required. The main points of contention are how the funds will be distributed - in the form of grants or loans - and conditionality for the support. The proposal takes into account the increased funding for the Just Transition Fund or the Common Agricultural Policy for Poland.

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Italian Economic Recovery Plan

Author(s): Maciej Pawłowski / Language(s): English

Italy has started to rebuild its economy, which has fallen into deep recession because of the COVID-19 pandemic. The government wants to achieve this goal through infrastructure investments, export and tourism support, and temporary legalisation of stay and employment of migrants. Part of these activities will be financed with funds from the new EU budget. The government’s economic recovery plan also presents an opportunity to reform the country, which increases the potential of an agreement on the shape of the EU budget, the multiannual financial framework (MFF) 2021-2027.

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Ukraine’s Foreign Policy in President Zelensky’s First Year

Author(s): Maciej Zaniewicz / Language(s): English

The foreign policy of Ukraine during the presidency of Volodymyr Zelensky is characterised by the continuation of integration with NATO and the EU and the aim to end the conflict in Donbas. Compared to his predecessor, Petro Poroshenko, Zelensky takes a more pragmatic stance, confirmed by greater flexibility during talks with Russia. However, Ukraine’s concessions to Russia have not resulted in progress in resolving the conflict. Sectoral integration with the EU may, in turn, be delayed by the economic crisis caused by the COVID-19 pandemic.

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Russia’s Arctic Policy

Author(s): Agnieszka Legucka / Language(s): English

Russia views the Arctic as a contested area with the U.S. and a place of competition with China. It regards any loss of its dominant position as the most important challenge in the Arctic region. To counteract it, Russia develops energy, military, and logistics infrastructure in the region. Although the role of transport in the Arctic, along the Northern Sea Route (NSR), is limited for now, the increased Russian military presence in the region is already a challenge for the security of NATO countries.

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Political and Economic Consequences of the COVID-19 Pandemic in Romania

Author(s): Jakub Pieńkowski / Language(s): English

On 16 June, a Romania’s “state of alarm” was prolonged for a month by the Ludovic Orban minority government. The pandemic has prevented his National Liberal Party (PNL) from holding early parliamentary elections, which, given the popularity of the formation, would be expected to allow it majority rule. The largest opposition force, the Social Democratic Party (PSD), could build a coalition in the current parliament but refuses to take power during the crisis. The government has provided temporary support for Romanian companies and announced an economic reconstruction programme that may incorporate aspects of the European Commission’s Next Generation EU initiative. The consequences of the pandemic will hamper Romania’s adoption of the euro.

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European Agriculture: Climate and Other Environmental Challenges

Author(s): Melchior Szczepanik / Language(s): English

The reactions to two new European Commission (EC) strategies concerning food production and biodiversity reflect discord between the advocates of accelerating changes in agriculture and proponents of a more circumspect approach privileging high output and competitiveness. The Commission, by increasing the Common Agricultural Policy budget, aims to contribute to the implementation of the strategies and improve its chances of persuading the Council, the European Parliament, and other stakeholders to endorse them. However, the objectives set by the strategies will likely be limited.

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The Pandemic as an Impulse for the Development of New Technologies in Sub-Saharan Africa

Author(s): Jędrzej Czerep / Language(s): English

A deep recession is projected for Sub-Saharan Africa in 2020 as a result of the COVID-19 pandemic. However, the market for new technologies providing solutions helpful during the health crisis, is developing dynamically. In the medium term, the research and development sector will gain importance and become attractive for investments, also for Polish companies.

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Chorwacja na drodze do przyjęcia euro

Author(s): Tomasz Żornaczuk / Language(s): English

W lipcu br. Chorwacja przystąpiła do mechanizmu kursów walutowych (ERM II) poprzedzającego członkostwo w strefie euro. Rząd, tak jak opozycja i większość opinii publicznej, widzi we wspólnej walucie więcej korzyści niż zagrożeń i wskazuje na możliwość jej wprowadzenia w 2023 r. Jednak, mimo braku przeszkód politycznych, prawdopodobnie nastąpi to później ze względu na problemy gospodarcze Chorwacji, przede wszystkim nadmierny dług publiczny, które pogłębiają się wskutek recesji spowodowanej pandemią COVID-19.

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Parliamentary Elections in Myanmar: A Challenge for EU Policy

Author(s): Patryk Kugiel / Language(s): English

The parliamentary elections in Myanmar on 8 November are likely to be won by the currently ruling National League for Democracy (NLD) led by Aung San Suu Kyi. However, the party will probably receive fewer votes than it did in 2015. A weaker electoral mandate and further isolation from Western countries will strengthen the military’s role, weaken democratisation, and will be conducive to increasing China’s influence. To prevent this, the EU may consider resuming cooperation with the civilian authorities despite accusations that it is persecuting the Rohingya minority. Greater engagement by the EU in Myanmar and closer cooperation with partners in Asia may give the Union more influence over the situation in that country than continued isolation of Aung San Suu Kyi.

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The Main Challenges for China’s Internal Situation after the First Phase of the Pandemic

Author(s): Marcin Przychodniak / Language(s): English

China faces rising debt and unemployment problems worsened by the COVID-19 pandemic and U.S. restrictions. The economic difficulties spur dissatisfaction in society and the party apparatus. The solution to the problems includes increasing the share of the internal market in GDP growth. At the same time, the Chinese authorities are strengthening their rhetoric of rivalry with the West, which they blame for the difficulties. The central authorities also have tightened control over party officials. The anti-Western attitude along with the continual centralisation of power will make it impossible to compromise with the EU, for example, on increasing access to the Chinese market.

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The Role of the Economy in the U.S. Presidential Campaign

Author(s): Damian Wnukowski / Language(s): English

The COVID-19 pandemic has hit the U.S. economy hard, including causing high unemployment. This weakens the incumbent president, Donald Trump, and increases challenger Joe Biden's chances of victory. For the EU, a Biden presidency may mean, for example, an easing of trade disputes with the U.S. and cooperation on climate protection. However, whichever wins, Biden or Donald Trump, the U.S. will pose a challenge to the EU and European companies, which may find it difficult to compete with the high level of support of U.S. companies.

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Estimating the Potential of China's Military Assistance to Russia

Author(s): Marcin Andrzej Piotrowski / Language(s): English

China’s military assistance to Russia would fill the majority of the latter’s needs and help it to regain the initiative in the war with Ukraine. Chinese support so far is based mainly on dual-use materials and items, but bilateral and multi-dimensional military cooperation between Russia and China will likely deepen. Ukraine’s partners might still influence and limit these areas of cooperation, which directly contribute to the continuation of war by Russia.

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№94: Much Ado About Very Little? Migration-Linked Development Assistance - the Cases of Poland and Norway

Author(s): Patryk Kugiel,Viljar Haavik,Morten Bøås / Language(s): English

In response to the migration management crisis that peaked in Europe in 2015-2016, the EU institutions and some European states promised to address the “root causes of migration”, with development assistance seen as an important tool in that respect. By comparing the development cooperation policies of Poland and Norway, this paper shows how the development-migration nexus has been implemented in practice by new and traditional donors alike. Despite important differences at the rhetorical level, neither state has substantially changed their development cooperation to link it directly to migration interests. This demonstrates the limited usefulness of the “root causes of migration” approach.

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№126: Tandem Faces an Uncertain Future: Franco-German Relations in a Time of War and Inflation

Author(s): Łukasz Jasiński,Łukasz Maślanka / Language(s): English

The COVID-19 pandemic and the crises caused by the Russian invasion of Ukraine represent the most serious test for the Franco-German tandem since the creation of the EU. Leaders in both countries share a conviction of the necessity of mutual cooperation, further increased by the compromise worked out around the EU’s post-pandemic recovery plan. However, the catalogue of divergences between France and Germany is long and includes crucial issues such as the shape of the common market, energy policy, and defence. A possible permanent loosening of the tandem may benefit Poland, but only on the condition that the country maintains constructive relations with France and Germany, cooperates well with EU institutions, and correctly diagnoses Polish interests in the areas of the Franco-German dispute.

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№131: EU Tackles Changes in Global Economic Competition

Author(s): Melchior Szczepanik / Language(s): English

Shaken by the experience of the COVID-19 pandemic and Russia’s full-scale aggression against Ukraine, the EU has adopted a series of legal acts to reduce dependence on authoritarian powers, create new instruments to defend against unfair competition, and facilitate the modernisation of the industrial sector. The smooth implementation of the green and digital transitions will be crucial to the success of these measures, but it requires additional financial resources. Furthermore, the drive to increase self-sufficiency in strategic sectors and build a low-carbon, sustainable economy is difficult to reconcile with a liberal approach focused on deregulation and short-term profit maximisation.

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№133: Options for Securing Free Trade Navigation in the Black Sea

Author(s): Marcin Andrzej Piotrowski,Daniel Szeligowski / Language(s): English

Russia’s withdrawal from the grain deal poses again the risk of destabilising the global food market. However, it is a reflection of a much larger problem represented by the Russian year-and-a-half-long blockade of the Black Sea, which has allowed it to gradually weaken Ukraine and drive up the cost of providing it with assistance from foreign partners. The international community should not pursue reactivation of the grain deal, which granted Russia de facto control of Ukrainian exports, and instead, the common objective should be to finally break the Russian blockade and effectively secure maritime trade across the Black Sea to Ukrainian ports.

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№196: “Decoupling” in Chinese: Challenges for China’s Economy

Author(s): Marcin Przychodniak / Language(s): English

In the long-term economic development plans adopted in March this year, the Chinese authorities emphasised the need to expand China’s internal potential to reduce its interdependence on the U.S. and other partners - a decoupling. However, they tend to take a conservative approach to challenges related to indebtedness, lack of innovation, consumption, and demographic changes. Instead of proposing market reforms, the Chinese Communist Party (CCP) is systematically increasing its control over the economy. In foreign cooperation, they find it important to maintain the level of exports in the context of China’s share in global value chains, as well as to acquire technology. For the EU, this means the necessity to implement new market-protection mechanisms, and in the longer term transfer production from China to the EU.

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Negotiations Resume to Resolve the Crisis in Venezuela

Author(s): Bartłomiej Znojek / Language(s): English

The meeting of representatives of the Venezuelan government and the opposition on 26 November in Mexico City marked a return to formal negotiations on overcoming the crisis in Venezuela. The parties agreed to establish a humanitarian fund and announced talks on presidential elections in 2024, among other issues. In response, the U.S. announced a conditional relief of sanctions on the Venezuelan oil sector. Further lifting of restrictions, depending on concessions from the regime of Nicolás Maduro, may be important for the global oil market, although only in a few years’ time.

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