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This book analyzes the state of global governance in the current geopolitical environment. It evaluates the main challenges and discusses potential opportunities for compromise in international cooperation. The book’s analysis is based on the universal criteria of global political stability and the UN framework of sustainable development. By examining various global problems, including global economic inequality, legal and political aspects of access to resources, international trade, and climate change, as well as the attendant global economic and political confrontations between key global actors, the book identifies a growing crisis and the pressing need to transform the current system of global governance. In turn, it discusses various instruments, measures and international regulation mechanisms that can foster international cooperation in order to overcome global problems.
Addressing a broad range of topics, e.g. the international environmental regime, global financial problems, issues in connection with the energy transition, and the role of BRICS countries in global governance, the book will appeal to scholars in international relations, economics and law, as well as policy-makers in government offices and international organizations.
The article looks into the reasons underlying the outspread of the full-scale mechanism of banking regulation over U.S. investment banks. We analyze the effect of the Basel III standards on stress-resilience of investment banks and examine the role of U.S. investment banks in ensuring financial stability. Based on regression analysis we found that minimum capital adequacy standards of Basel III do not have negative effect on ROE of the U.S. investment banks that are G-SIB category-designate; however additional capital requirements (Higher Loss Absorbency (HLA) surcharge) that depend on G-SIB’s systemic significance according to their bucket as per Financial Stability Board classification do have significant and negative effect on ROE in the post crisis period. Besides, leverage requirements that also depend on G-SIB’s systemic significance have a statistically significant effect on ROE.
The Paris Agreement introduces long-term strategies as an instrument to inform progressively more ambitious emission reduction objectives, while holding development goals paramount in the context of national circumstances. In the lead up to the twenty-first Conference of the Parties, the Deep Decarbonization Pathways Project developed mid-century low-emission pathways for 16 countries, based on an innovative pathway design framework. In this Perspective, we describe this framework and show how it can support the development of sectorally and technologically detailed, policy-relevant and country-driven strategies consistent with the Paris Agreement climate goal. We also discuss how this framework can be used to engage stakeholder input and buy-in; design implementation policy packages; reveal necessary technological, financial and institutional enabling conditions; and support global stocktaking and increasing of ambition.
Is it possible for Russian energy companies to develop an effective business strategy based on the restrictions and rules of strategic documents of national scale?
Today Russian Energy Strategy sets the benchmarks for business. World experience confirms the possibility of adjusting corporate strategies for the benefit of society. Danish Energy Strategy prescribes a smooth transition to alternative energy sources and active implementation of smart energy resources. Experience of Norway in this area is also important. The third energy package of the EU defines the rules of the game influencing business models, strategies and long-term deliveries of external counterparties.
The set of methods allows for the analysis of open sources and materials for the development of national and corporate strategies. Management technologies allow us to specify and quantify the characteristics of the national energy strategy, and to reflect on the priorities in the development strategies of companies. The conditions of the state policy and the parameters of the companies' strategies will have more points of contact and reduce the risk of deviation from the declared goals. Revision of the program document is possible due to organizational design and methodological support.
The paper is devoted to the assessment of the prospects of implementing clean energy sources in Russia, where the current energy policy goal is to increase the role of renewable and clean energy sources. The research is based on data from the Krasnoyarsk Region as one of the largest territories but also as a representative model of Russia. The aim of the study is to identify where and which renewable energy source (solar, wind, hydro and nuclear) has the highest potential. The novelty of our research lies in its holistic nature: authors consider both geographical and technical potential for renewable energy sources development as well as prospective demand for such resources, while previous research is mostly focused on specific aspects of renewable energy development. We also consider the level of air pollution as an important factor for the development of renewable energy sources. The results of the study show that there is a strong potential for clean energy sources in the Krasnoyarsk Region. The resulting matrix identifies the potential of energy sources across all the municipal entities and also indicates whether the source of energy is primary or supplemental and where several sources may be implemented in cooperation.
The trend on electricity grids digitalization is gradually leading to the shift of busi-ness value towards more sustainable and efficient electricity services. Sustainability and efficiency are challenged by the increasing demand for electricity which is fol-lowed by a dramatic transformation of energy systems. While smart grids seem to be crucial in this process, there is a discrepancy in understanding the costs and benefits for the multiple actors involved. In addition, there are benefits of smart grids that cannot be measured directly in terms of money, such as higher energy system reliabil-ity or commitment to carbon reduction. Despite the rise of interest to the managerial aspects of smart grids implementation and development, many aspects remain out of the scope. This paper contributes to the research of smart grids by providing a con-ceptualized business model that would allow for value co-creation, delivery and cap-ture. A Russian energy sector perspective is primarily considered throughout the pa-per and the results are supported by evidence from interviews with of industrial ex-perts
The electric energy industry plays a crucial role in the technological support of digitalization, and this leads to an increase in the requirements for its development. Leading developed countries are currently under energy transition and are creating innovative, intelligent energy systems (IES) of open type, which include active consumers, distributed generation mechanisms and the introduction of renewable energy sources. One can observe a deep structural transformation, expansion of the range of participants and creation of new value chains. The development of digitalization and IES provides with new opportunities for sustainable development of the economy and society. This stage facilitates the creation of new tasks for the investment climate in the power industry, so the development of an institutionalsystem is justified.
The energy sector of Russia is one of the most potent in the world - it is the second in extraction of oil and gas, the third for total output of fuel and energy resources. While exporting nearly 45% of its total production of energy resources, Russia produces more energy per capita than most other countries - 5 times higher the global average and 3 times higher than the average level for OECD countries. The energy sector of Siberia represents the crucial part of the country's energy sector. Over decades, the energy resources of the region massively contributed to the Russian federal budget and brought in a major part of hard currency from export trade. In the current conditions of existing geopolitical challenges and expected global demand for energy resources, it is much more of a priority for Russia not to raise the output of fuel and energy resources but to improve the overall quality and reliability of the whole energy supply system, increase the depth of mineral fuel, including solid fuel and waste recycling.
The article presents the results of predictive studies of the development of new energy sources using the example of wind energy technologies in the countries of the North Sea Basin. Predictive estimates (based on the mathematical technique of learning curves), the dynamics of installed power and the generation of electric power by floating wind power stations, as well as the processes of replacing traditional energy with developing energy technologies in various countries, including Russia, are considered. The economic characteristics of energy technologies at an early stage of development are given.
This paper examines Japan’s participation in global value chains (GVCs). To this end, we use plant-level data for Japan to split output in each industry in Japan’s manufacturing sector into output for export or domestic sale and create an extended multi-country input-output table (MIOT). We then compute trade in value added (TiVA) indicators to examine the participation of Japanese manufacturing plants in GVCs. Our estimates suggest that Japan’s forward participation in GVCs is lower than suggested by estimates computed from a traditional MIOT. We infer that this result is due to high cross-border production fragmentation as well as the large presence of Japanese multinational companies in global manufacturing and the high volume of intra-firm trade in Japan’s manufacturing sector. We conclude that considering firm heterogeneity in production for export and domestic sale in MIOTs provides a more accurate understanding of global production fragmentation.
The Kyrgyz Republic became the fifth member of the Eurasian Economic Union (EAEU) on August 12, 2015. In order to become a “full” member this country at a certain degree had to harmonize and change its legislation in accordance with the basic provisions of the Union legal acts.
The article determines and systematizes concordance of national technical regulations and EAEU (Customs Union) technical regulations. The research focuses on non-tariff measures (NTMs) applied by the Kyrgyz Republic in light of the Eurasian economic integration.
UNCTAD’s database (TRAINS/WITS database) was used in order to analyze national NTMs. In total 218 actively applied NTMs were analyzed. Most of them are import-related technical measures (Sanitary and phytosanitary measures – SPS, and Technical barriers to trade - TBT) and export-related (technical and licensing/authorization) measures. In addition to composition of the Kyrgyz national NTMs, author revealed their correspondence to main principles of the World Trade Organization (WTO): most-favored nation and national treatment clause.
Thus our research revealed that measures which are viewed as barriers may not only hinder the trade of the Kyrgyz Republic with the third countries, but also may slow down the integration processes within the EAEU. The research on this matter can be further developed.
Purpose: The regional economy depends on the structure of industrial production which has been established earlier. This study makes it possible to determine the hi-tech spheres in which the entrepreneurship is going to develop more successfully. The purpose of the investigation is to determine the technological proximity of the industrial production branches with the high-tech economy sector for further defining the egress from the previous development path.
Methodology: In order to determine possible egress of the region from the previous development trajectory there has been proposed a method of proximity evaluation between the high-tech sector and the existing structure of industrial production in the region. The characteristics of high technologies relatedness to other industry branches in the Russian regions have been defined.
Findings: For the Russian regions it was determined that less than 30% of sub-branches can be considered as connected with the high technology sector - 25%. The regions having the comparative advantages in the high-tech types of industry and sectors related thereto have been revealed. We have demonstrated that individual regions can progress through investment into interregional connections and entrepreneurship domestic innovations.
Research/practical implications: Considered as the investigatory contribution of the paper can be the alternative proposed to the comparative advantage index in the form of a localization coefficient to be used at evaluation of the technological proximity of industrial branches. The results of this study can be of benefit to representatives of the regional managerial bodies in the course of the economic policy development in the sphere of entrepreneurship.
Originality/value: Proposed in the article is a method for evaluation of technological proximity of industry branches which differs from the traditional use of the localization coefficient. The calculated proximity indexes make it possible to determine such high-tech industries to the development of which there are the necessary prerequisites in the region, i.e. the technologically similar industrial production is under development.
Integration processes in the EAEU is associated with the development of regional banking regulation that secures the effectiveness of the integration policy and, ultimately, financial stability. The integrity of the regional regulatory mechanism will largely depend on the effectiveness of convergence and supranationalization of the economic and institutional aspects of banking regulation of the EAEU member states, and at the same time – on their synchronization with Basel III. In this regard, a regional regulatory mechanism – mini Basel III – should become the central core of the EAEU regulatory and supervisory system, a tool for mitigation of systemic risks, and a mean for maintenance of stress resilience of the national banking sectors, as well as a channel of interaction with international banking regulation authorities.
However, currently EAEU banking regulation lacks a complete framework, mostly due to the shortage of strategic vision on regulatory convergence and poor understanding of the integration risks due to the absence of reliable tools for measuring imbalances in the banking sector. Besides, a number of issues of institutional supranationalization, including the delegation of the regulatory power from national to supranational level, still remain open.
In this work, the author continues the study of the regionalization of banking regulation and supervision in the EAEU focusing on systemic risks and how the mini-Basel III mechanism could become a key tool in minimization of the system-wide instability and crises.
The study of economic growth and social inequality goes back to the works of S. Kuznets, A. Atkinson, P. Krugman, J. Stiglitz, T. Piketti, and B. Milanovic. Statistical analysis of social inequalities for a large set of countries, divided into seven clusters, was conducted for the period 2000–2016. The share of incomes of the 10th decile was used as a measure of inequality. The hypothesis of the positive impact of economic growth on the reduction of social inequality was tested. Stylized facts on an array of 106 countries for the period under review indicate a high degree of stability of the level of inequality in most groups, especially in the most developed countries, and in particular in the Anglo-Saxon ones. The distribution of key socioeconomic and even political indicators for clusters shows their strong relationship with the structure of cluster inequality. This makes it possible to significantly deepen the analysis, in particular the one concerning the stages of world development.
A brief analysis of the draft document “Russia 2030: Science and Technology Foresight” (of December 19, 2017) is presented. The authors, who are leading researchers at the Institute of Economics and Industrial Engineering, Siberian Branch, Russian Academy of Sciences, reveal discrepancies between a series of provisions in the document and the current level of Russia’s economic development, primarily in science and technology. The document provides virtually no economic rationale or analysis of what causes the loss of science and technology potential in Russia. The attempt to foresee the technological development of individual Russian regions is unsuccessful. The general conclusion is that the foresight document does not provide a single platform for the development and implementation of strategic planning documents in the field of science and technology.
The institutional aspect of post-crisis banking regulation reform (Basel III) remains unsettled, and as such undermines regulators’ efforts to shape a seamless platform for international financial intermediation. The lack of global acceptance of the Basel III standards amid the internationalization of banking activities is one of the main reasons for regulatory asymmetries which are difficult to handle at the national level. In this context, the efforts of governments and financial regulators are a central core of their policy in protecting banking sectors from systemic risks. It becomes imperative to bring together national mechanisms of banking regulation and to develop a regional system of regulatory institutions, as is evidenced by the single supervisory mechanism in the eurozone countries.
Strengthening stress-resilience of the national banking sectors in the Eurasian Economic Union (EAEU) and the expansion of banking activities to the Eurasian economy will require a conceptual framework of the EAEU banking regulation system. However, different regulatory regimes in EAEU states along with the lack of supranational regulatory institutions may slow the progress of the Eurasian mechanism of banking regulation. This means that operationalization of the EAEU regulatory mechanism will depend on whether the mini-Basel III format as a methodological hub of regionalization and supranationalization will act as an enabler of a resolution to the regulatory trilemma of the feasibility, relevance and opportunities of supranationalization.
The institutional aspect of mini-Basel III is intrinsically linked to the integrity and consistency of the supranational authority for regulation of EAEU financial markets being an authority documented in the treaty on the EAEU; however, the costs of regulatory alignment may exceed the advantages of a single-institution regulatory architecture owing to the existent and tacit risks from the heterogeneity of the national regulatory models. Stemming from the complex financial sector environment that falls short of valid and reliable institutional fundamentals, this article proposes alternative scenarios for the EAEU regulatory mechanism that could be sought for optimization of regulatory logistics and algorithms of regulatory alignment. Based on systematization of the benefits and weaknesses of each of the scenarios as well as on a comparative analysis as to whether the proposed scenarios would ensure a continuum of financial intermediation and financial stability, this article concludes that currently there are no priority approaches to the design of a supranational institutional system in the EAEU. At the same time, the identical structure of national banking sectors together with the least expensive scenario approach could underpin the process of regulatory supranationalization; however, to secure the integrity of the EAEU supranational authority, it should be complemented with an authority that would be responsible for the coordination of EAEU-wide regulatory alignment.
The Eurasian Economic Union (EAEU) is relatively new regional integration block formed in the beginning of 2015 and now consists of five members (Armenia, Belarus, Kazakhstan, Kyrgyzstan and Russia). The main document that establishes the basic principles of the functioning of the EAEU is the Agreement on EAEU that also covers the specifics of application of non-tariff measures (NTMs) on a very aggregate level. Overall NTMs adopted within EAEU are equally applied by the members of the Union. But still these measures may find their reflection in the national legislation of the member-states.
In order to analyze EAEU NTMs two sources of information were used: website of the Eurasian Economic Commission and TRAINS/WITS database. They were used as complements and allowed to find the most up to date versions of the legal acts that cover trade- and NTM-related aspects of EAEU functioning.
The paper presents the position of the Institute of Economics and Industrial Engineering, Siberian Branch, Russian Academy of Sciences, on the elaboration the Spatial Development Strategy of the Russian Federation. It is shown that in the formation of conceptual approaches to developing the strategy, there was a fundamental change in its priorities, focus, and implementation mechanisms. Whereas the first version of the strategy concept contained a truly progressive vision of the problems, challenges, priorities, possible scenarios of the country’s spatial development, and mechanisms for implementing the strategy, with each subsequent workflow step, these progressive approaches were lost. It is shown that, although the Spatial Development Strategy of the Russian Federation for the period up to 2025 adopted in early 2019 partly took into account comments and suggestions, it nevertheless remained very vulnerable to criticism. The article considers conceptual defects in the Spatial Development Strategy of the Russian Federation, such as ignorance of new trends, challenges, and threats arising in the Russian economic space; the dominance of the idea of allocation of funds to implement the strategy only through the development of urban agglomerations, neglecting the tasks of ensuring social justice and supporting the human potential of Russian society, ensuring the environmental safety of business operations, and life of the population in particular territories, etc.
The Republic of Kazakhstan became one of the first members of the Eurasian Economic Union (EAEU) that was formed on January 1, 2015. As a full member this country had to change its legislation in accordance with the EAEU legal acts. This article is devoted to non-tariff measures (NTMs) applied by the Republic of Kazakhstan in the context of the Eurasian economic integration. The importance of NTM research is defined by the fact that excessive regulatory policies may result in decreased growth rates of economy and overall loss of welfare. UNCTAD’s database (TRAINS/WITS database) was used in order to analyze national NTMs. In total 239 national actively applied NTMs were analyzed and systematized. Most of them are either import-related technical measures (Technical barriers to trade - TBT, Sanitary and phytosanitary measures - SPS measures) or export-related technical measures. Together they account for approximately 94.8% of applied national NTMs. In addition to the analysis of NTMs in terms of their type and type of affected product, author revealed the correspondence of Kazakhstan’s national NTMs to basic principles of the World Trade Organization (WTO): most-favored nation (MFN) and national treatment clause. Thus our research determined measures that represent a violation of MFN principle or national treatment clause. So these NTMs may be barriers to trade of the Republic of Kazakhstan with the other countries. Further research of ad valorem equivalents (AVE) of the measures is required in order to determine the economic effects of the non-tariff measures applied by the Republic of Kazakhstan.