April 28, 2017

This is Economics!

AP Photo/Richard Drew

The April edition of Diplomaatia focuses to a greater or lesser extent on economic issues. This includes the economy inside and outside Estonia’s borders, since a small country like Estonia is influenced by changes at the global level.

Kaspar Oja, an economist at Eesti Pank (Central Bank of Estonia), writes about the slowdown of the world economy and its influence on Estonia.
Priit Pallum, a long-serving diplomat at the Estonian Ministry of Foreign Affairs, who has been active in the field of economics, writes about how Estonia’s foreign policy is connected to its economy. Or, to be more precise: “Estonia has no foreign economy. There is one economy, and it is so closely linked to the rest of the world because of globalisation that we take the foreign element for granted and do not even notice it. Estonia’s ratio of exports (in goods and services) to GDP is eight to ten—twice the European average,” says Pallum.
Belarusian economist Leonid Zlotnikov explains in his interview with Diplomaatia why the Belarusian business model is no longer sustainable and how it is dependent on relations with Russia. “I want to stress that the main cause [of all economic problems] lies not with lower oil prices or the decline of Russia’s economy, but rather the fact that the Belarusian business model is simply not sustainable. What has happened now is natural and will be with us for some time. The warehouses of Belarusian factories are full of goods that have not been sold. Even the warehouses at MAZ (trucks) and Belaz (huge tipper trucks used in mining) are packed.”
Hudson institute analyst Richard Weitz gives an overview of Sino-Russian economic relations. “Russian hopes of China filling the Western sanctions gap has not panned out. The devaluation of the Russian rouble, the Chinese and Russian economic slowdown, and the fall in global gas and oil prices have sparked a major decline in Sino-Russian trade volumes and quelled the hoped-for PRC direct investment in and loans for Russian industry,” writes Weitz.
Mark Gortfelder, junior research fellow at the Estonian Institute for Population Studies, writes about why the Chinese one-child policy can be considered unsuccessful. “The Chinese government and its researchers boast that the one-child policy has managed to prevent 400 million births, created a foundation for the exponential development of the economy, and contributed strongly to battling global warming—but no serious demographer believes this,” notes Gortfelder.
Margus Laidre, Estonia’s ambassador to Finland, reviews a book by Finnish diplomats on Finland’s foreign policy.

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