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Weekly Summaries

11th of October – 17th of October

Nobel Prize in Economics

The 2021 Nobel Memorial Prize in Economic Sciences was awarded to three U.S.-based economists who work with real-life experiments. David Card from the University of California, Berkeley, specializes in studying “unintended experiments to examine economic questions.” An example of such an experiment is whether raising the minimum wage causes people to lose their jobs. Joshua D. Angrist from the Massachusetts Institute of Technology and Guido W. Imbens from Stanford University won the prize for their joint work on developing research tools that economists utilize to test major theories using real-life situations. An example of this could be whether additional education has an impact on the amount a person earns. Click here to watch a video of the three winners

Other News

  • 32 countries joined the U.S. in a deal aiming to reduce methane emissions by 30% by 2030 that was developed by the E.U.
  • A trial in Burkina Faso hopes to finally establish who killed Thomas Sankara, the former president, more than 30 years after his death
  • In a pledge, the E.U. decided to give 1 billion Euros (around 1.15 billion US$) in aid to Taliban-ruled Afghanistan and neighboring countries
  • A man killed 5 people using a bow and arrow in Kongsberg, which is just outside of Oslo, Norway. The police announced that the suspect is now undergoing psychiatric evaluation
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Weekly Summaries

27th of September – 3rd of October

Lithuania enrages China

Recently, Lithuania has been trying to get closer to Taiwan, enraging China by taking actions such as quitting a Chinese-led diplomatic forum. In response, China recalled its ambassador to Lithuania, made it basically impossible for Lithuanian businesses to sell their goods in China, and paused trips by a Chinese cargo train into Lithuania. While Lithuania is a lot smaller than China — China has 1.4 billion people while Lithuania has fewer than 3 million — the country is important as a “transit corridor” for goods heading to Europe from Asia.

Other News

  • Shortages are restraining the recovery of many parts of the economy worldwide
  • In a tweet last week, the Taliban announced that women would be barred from teaching and studying at Kabul University, Afghanistan’s most prestigious university
  • Facebook has “paused development of an Instagram app for children under 13,” according to the New York Time
  • Japan’s governing party elected its choice for the next prime minister: Fumio Kishida

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Weekly Summaries

6th of September – 11th of September

Uncertainty in Nicaragua

The current President of Nicaragua, Daniel Ortega, is taking steps to ensure that he will win the elections in November again. The New York Times writes that there is no “credible challenger” and that Ortega is “turning Nicaragua into a police state.” Seven candidates have been jailed or put under house arrest since June alone and people from all backgrounds — from millionaire banker to a decorated general to a low-profile provincial activist — have been targeted.

Other News

  • The U.S. remembered the 9/11 attacks that happened 20 years ago.
  • Maria Kolesnikova, a Belarusian opposition figure, was sentenced to 11 years in prison during a trial in Minsk last week
  • In a ruling last week, Mexico’s Supreme Court decided that making abortion a crime was “unconstitutional”. Nonetheless, abortion is still not available to most of the Mexican female population.
  • El Salvador adopted Bitcoin as a legal tender, the first country to do so
  • The Taliban named an acting cabinet last week. However, the lack of women and some former leaders from the Taliban’s 1990s regime have raised alarm bells in other countries.
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Weekly Summaries

30th of August – 5th of September

U.S. Forces Left Afghanistan

The last U.S. forces left Afghanistan last Monday. Their departure ended a 20-year long occupation. The war in Afghanistan cost the U.S. over $2 trillion and left more than 170,000 people dead. Shortly before midnight, the last 5 American cargo jets left the Kabul airport, leaving behind many Afghans, including former members of the security forces. The Taliban and fighters celebrated the U.S. departure and gunfire could be heard across Kabul. A day later, President Biden once again defended the withdrawal, claiming that it was a choice “between leaving or escalating” the situation.

Other News

  • The return of a Napoleonic general, Gen. Charles Etienne Gudin, was supposed to improve relations between France and Russia, two countries that have long had difficult diplomatic relations. However, when the ceremony took place, the Presidents were not to be seen. 
  • The leader of Guinea’s special forces led a coup, announcing on state television that the constitution and government had been dissolved. Whether he will be successful is still uncertain.
  • Less than a year after he started office, Prime Minister Yoshihide Suga of Japan said that he would not seek re-election
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News

The fate of Afghanistan’s economy after the Taliban takeover

Introduction

Afghanistan is one of the poorest countries in the world due to the destruction of its limited infrastructure through wars, predominantly after the Soviet Invasion (1979- 1989). Along with political instability and high dependency on foreign aid, this state of depravity is perpetuated.

The biggest news in the world from the past few weeks stems from the Taliban takeover of Kabul, the capital of Afghanistan, and effectively replacing the Afghanistan government. With most government officials and Former President Ashraf Ghani fleeing the country, the Taliban has now taken complete control of the presidential palace and declared that the war is over. How will this impact the economic conditions of Afghanistan?

Foreign Investments

As mentioned earlier, Afghanistan is greatly dependent on foreign aid. However, international aid flows are under a cloud of profound uncertainty. German Foreign Minister Heike Maas told the ZDF broadcasting program, “We will not give another cent if the Taliban takes over the country and introduces Sharia law.”(Sharia Law is the Islamic legal system, which governs religious rituals and aspects of day-to-day life, including finance and banking).

Moreover, following recent unrest and the toppling of the government, investor confidence in Afghanistan could drop to an all-time low.

 So, now that the Taliban has taken complete control of Kabul, international trade and business will soon come to a halt as the militant group has stopped all exports and imports, particularly with India. India imports about 85% of its dry fruits from Afghanistan. The Federation of India Export Organisation expressed concern that dry fruit prices may go up in the coming days due to the turmoil in Afghanistan.

 Hence, the Afghanistan economy has the potential to experience a significant downfall, since international aid accounted for ~43% of their GDP (Gross Domestic Product) in 2020, per the World Bank. Thus, considering the following in terms of foreign investment, the nation has a bleak future.

Mineral Resources

According to WION, while Afghanistan may be one of the poorest nations in the world, it is a region of vast mineral resources. In 2010, American geologists said the resources in this region are worth about – $1 trillion.

Valuable minerals such as iron ore, copper, gold, lithium, sulphur, and various gemstones, to name a few. A 2010 report of Afghanistan’s Ministry of Mines recorded the country’s copper resource at almost 30 million tonnes. Further, another report in the same year said that 28.5 million tonnes of copper lay hidden in undiscovered deposits, bringing the total to roughly 60 million tonnes. Given current rates at the London Metal Exchange, the mineral resources would amount to ~$500 million. Moreover, Afghanistan has a gold resource of at least 2700 kilograms, making gold the most favourable hedge ever since inflation. (Inflation is the rate at which the general level for the price of goods & services rise, resulting in a sustained drop in the purchasing power).

However, one mineral has particularly a striking potential. Lithium is a metal used in the batteries of mobile devices and electric cars. The latter application will be crucial in the future, as the automobile sector is quickly transitioning towards zero-carbon forms of transport.

Today, lithium is also facing unprecedented demand, with an annual market growth of 20% compared to just 5-6% a few years ago. According to the International Energy Agency, global demand for lithium is expected to grow by over 40 times by 2040. Additionally, The Pentagon memo designated Afghanistan as “The Saudi Arabia of Lithium”.

China Takes Interest?

Back in 1996, when the Taliban first took control of Afghanistan, China refused to recognize their rule and left their embassy shut for years. This time around, Beijing has been one the first to embrace the Islamist militants next door.

But, what prompted such a change of heart?

Director of the China Program at the Washington-based Stimson Center Yun Sun said: “Twenty years ago, China was not a global power and what was happening in Afghanistan did not bother China.”

Today, China commands an economy worth $14.7 trillion—more than 17 times its size in 1996—in addition to a massive trade-and-infrastructure initiative that stretches across the Eurasian landmass. Although China has not officially sought ties with the militant group, there are hints that it will provide financial assistance to Afghanistan.

 China is currently eyeing the mineral resources of Afghanistan, which are worth $1 trillion. Moreover, the large reserves of copper and lithium specifically will be highly beneficial for the Chinese electronics industry.

The Taliban will need significant assistance to rebuild Afghanistan. Because Western countries and financial institutions are unlikely to assist, China, with its massive reserves of capital and proximity to Afghanistan, can play a supporting role in the survival of a future Taliban government.

Conclusion

In conclusion, Afghanistan may have a chance to grow its economy under such grave circumstances with Chinese assistance.

The exploitation of the rare earth minerals would bring foreign currency to Afghanistan, whose weak economy relies on subsistence agriculture, services, and international aid. However, some observers are calling not to overestimate China’s interests in Afghanistan.

Their statements imply that the idea of a China which would get its hands on the mineral wealth of Afghanistan is a fantasy. Researchers say that the recent investments that China will specifically be for the exploitation of pine nuts (Pine nuts are one of the more expensive nuts on the market). It can be said that Chinese interest and collaboration with Afghanistan under Taliban control may be short-lived.

Sources


1.What next for Afghanistan’s economy? – BBC News
2. Financial News – Forex News, Stocks Market News (fxempire.com)
3. The fate of Afghanistan economy under Taliban rule | Business News (timesnownews.com
4. Minerals worth trillion dollars: So really how big is Afghanistan’s economy under Taliban control? (msn.com)
5. What next for Afghanistan’s economy? – BRIGHT NEWSROOM
6. Why China is interested in Afghanistan (linkedin.com)
7.Taliban to reap $1 trillion worth of Afghanistan’s mineral wealth – Frontline (thehindu.com)

Categories
Weekly Summaries

23rd of August – 29th of August

Afghan refugees and an increasingly dramatic situation at the airport in Kabul

Thousands of people are still waiting at the airport in Kabul for a flight out of Afghanistan and the August 31st deadline to complete the Afghanistan operation is fast approaching. To make the situation even more urgent, Taliban leaders rejected President Biden’s suggestion to extend the deadline for the completion of the operation. Last Wednesday, President Biden then announced that the U.S. was “on track” for a military departure from Afghanistan on August 31st.

On Thursday, two suicide bombers outside of Kabul’s airport killed at least 13 U.S. troops and many Afghans, including children. The Islamic State has since claimed responsibility for the attack. President Biden vowed retaliation, saying “we will not forgive.”

This past week reports also surfaced which state that weeks before Kabul fell to the Taliban, tens of thousands of Afghans were already traveling across Iran, hoping to cross Turkey to reach Europe. However, President Erdogan of Turkey has claimed that Turkey will not be “able to shoulder the additional burden” as it has already taken in 5 million refugees. Last week alone, more than 1,400 Afghans who were in Turkey were rounded up and pushed back by the police in a single operation.

Other News

  • The IMF (International Monetary Fund) gave financial aid to poor countries worth US $650 billion to help them “pay down debt and withstand the costs of combating the coronavirus pandemic,” the New York Times reports
  • The highest point on Greenland’s ice sheet has never experienced rainfall that is until last week
  • To prevent Belarusian migrants from entering, Poland and Lithuania are planning to build fences along their shared borders with Belarus, according to the New York Times
Categories
News

Taliban Rises to Power Again

Introduction

What are the Taliban? The Taliban is a militant terror group that ruled Afghanistan under the command of Mullah Omar (founder and the first leader of the Taliban) from 1996 – 2001 until they were toppled by the U.S. forces. In response to the 9/11 attack, the US launched “Operation Enduring Freedom,” which was aimed at all the suspects of the attack — mainly Al Qaeda and Taliban. Due to this, the Taliban was overthrown easily. The ideology followed by the Taliban is extremist. They aim to install Islamist rule all across Afghanistan. They have almost 85,000 fighters according to recent NATO estimates.

Timeline

Early1990s 

● Taliban emerged in Pashtun areas straddling Pakistan and Afghanistan 

1995 

● Captured the province of ‘Herat’ 

27 SEP 1996 

● Taliban captured the Afghan capital, Kabul, and the regime of President Burhanuddin Rabbani was overthrown 

● Islamic Emirate of Afghanistan was established by Mullah Omar 

1998 

● 90 percent of Afghanistan was captured 

● They enforced their own Islamic or Sharia Law once they were in power 

2001 

● Al-Qaeda, led by Osama Bin Laden in Afghanistan, carries out the largest terror attack ever conducted on US soil (9/11) 

● A US-led coalition bombs Taliban and al-Qaeda facilities in Afghanistan. Targets include Kabul, Kandahar and Jalalabad. 

(7th of October) 

● Fall of Kabul; the Northern Alliance, a group of anti-Taliban rebels backed by coalition forces, enters Kabul as the Taliban fled the city. (13th of November) 

2004 

● New constitution, 26th of January; the constitution paves the way for presidential elections in October 2004.

● Hamid Karzai, the leader of the Popalzai Durrani tribe, becomes the first president under the new constitution. He serves two five-year terms as president. 

2006 

● UK troops deployed to Helmand, May 2006 

2009 

● 17th of February 2009, U.S. President Barack Obama approves a major increase in the number of troops sent to Afghanistan. 

2011 

● Osama bin Laden killed, 2nd of May 2011 

2013 

● Death of Mullah Omar, 23rd of April 2013 

2014 

● NATO ends combat operations, 28th of December 2014 

2015 

● Taliban resurgence 

2020 

● The US and the Taliban sign an “agreement for bringing peace” to Afghanistan, in Doha, Qatar on the 29th of February. The US and Nato allies agree to withdraw all troops within 14 months if the militants uphold the deal.

2021 ● On the 16th of August, the Taliban returned to power, In just over a month, the Taliban swept across Afghanistan, taking control of towns and cities all over the country, including Kabul. Afghan security forces collapsed in the face of the Taliban advance.

What is happening in Afghanistan now?

On April 14, US President Joe Biden announced that the US forces would withdraw by September 11th, 2021. In May 2021, foreign forces started to withdraw from the country and the Taliban stepped up to defeat the Western-backed government. The Taliban captured 26 provincial capitals in just 10 days, while Kabul fell in 1 day and the Taliban were thus able to take control over Afghanistan again. On August 15th, Afghanistan’s President Ashraf Ghani, who was backed by the U.S., resigned and fled to Oman.

On August 14th, Joe Biden made a statement about the Afghanistan crisis and what role the U.S. will play : 

“Over the past days, I have been in close contact with my national security team to give them directions on how to protect our interests and values as we end our military mission in Afghanistan. 

First, based on the recommendations, I have authorized the deployment of approximately 5,000 U.S. troops and an orderly and safe evacuation of Afghans who helped our troops during our mission and those at special risk from the Taliban advance. 

Second, I have ordered our Armed Forces and our Intelligence Community to ensure that we will maintain the capability and the vigilance to address future terrorist threats from Afghanistan. 

Third, I have directed the Secretary of State to support President Ghani and other Afghan leaders as they seek to prevent further bloodshed and pursue a political settlement.

Fourth, we have conveyed to the Taliban representatives in Doha that any action on their part on the ground in Afghanistan, that puts U.S. personnel or our mission at risk there, will be met with a swift and strong U.S. military response. Fifth, I have placed Ambassador Tracey Jacobson in charge of a whole-of-government effort to process, transport, and relocate Afghan Special Immigrant Visa applicants and other Afghan allies. Our hearts go out to the brave Afghan men and women who are now at risk. We are working to evacuate thousands of those who helped our cause and their families.”

What does the Taliban’s return mean for the citizens of Afghanistan?

Questions are being asked about how the group will govern the country, and what their rule means for women, human rights, and political freedom in Afghanistan. Its leadership says it wants peace and an inclusive government that is compatible with Islamic law or the Sharia Law, but many Afghans are skeptical about this and thousands have already fled the country, fearing a return to a brutal and repressive regime.

A brief about the Sharia law: 

Sharia is Islam’s legal system. It is the set of laws that govern the daily lives of Muslim people and it is based on a combination of the Quran and the teachings from the prophet Muhammad. 

Taliban officials have repeatedly tried to assure Afghan citizens, particularly women, that this time the rule will be different. Earlier this week, the Taliban urged women to join its government. Some representatives have also said that women will be allowed to work and study. When they were last in power, the Taliban had made full burqa compulsory but this time they said that women will not be required to wear a full Burqa, and can opt for just the hijab (headscarf). Well, what is the actual situation on the ground? Despite their assurances, parts of the country are seeing a return to the repressive old order, women in some provinces are not allowed to leave their home without a male relative escorting them and were also denied access to universities in some places, girls have been banned from returning to schools and there have been reports of several forced marriages. Smartphones and television have been banned, young men are being forced to join their ranks. Reporters and peace activists who raised their voices against the Taliban face risk to their lives. In the current situation in Afghanistan, chaos has been created everywhere, Airports and ATMs were mobbed with thousands of people trying to escape the country. According to reports, 5 civilians have been shot at the terminal, 3 people were also seen holding on to the wheel of a US plane flying out of Kabul.

How are other countries and the UN reacting?

United Nations: UN Secretary-General Antonio Guterres urged the Taliban to exercise utmost restraint to protect lives 

China: Released a statement that it is looking to deepen “ friendly and cooperative” relations with Afghanistan.

Pakistan: Imran Khan, made a statement which was “ The Afghans broke shackles of slavery” 

Germany: Released a statement that U.S, troops withdrawal was the “biggest NATO Debacle”.

India: Union minister of state for External Affairs, Meenakshi Lekhi, said that India wants peace all over the world as India continues evacuation exercises to rescue Indians currently in Afghanistan.

Why was the Taliban’s renewed rule over Afghanistan inevitable?

Over the past 20 years, the U.S. has poured trillions of dollars into Afghanistan to oust the Taliban, an effort that was clearly unsuccessful. But a look at the country’s strategic geographic location and the politics of the region tells us that this outcome was inevitable. Afghanistan is strategically located between central and south Asia – a region rich in oil and natural gas. It has long faced constant meddling from the Soviet Union/Russia, the UK, the U.S., Iran, Saudi Arabia, India, and Pakistan.

Sources

  1. https://scroll.in/article/1002900/talibans-victory-in-afghanistan-was-inevitable-even-after-two-decades-of-american-intervention
  2. https://www.aljazeera.com/program/inside-story/2021/8/17/what-does-the-talibans-return-to-power-mean-for-afghanistan
  3. https://www.bbc.com/news/world-south-asia-11451718
  4. https://www.bbc.com/news/world-27307249
  5. https://www.whitehouse.gov/briefing-room/statements-releases/2021/08/14/statement-by-president-joe-biden-on-afghanistan/

Categories
Weekly Summaries

16th of August – 22nd of August

Chaos at the airport in Kabul

Thousands of Afghans continue to try to flee the country, with some clinging on to departing planes and crowds at the airport trampling people to death. Britain and Canada have since announced that they will both take 20,000 Afghans each who had fled the country. Meanwhile, President Biden defended the “hard and messy” retreat from Afghanistan, claiming that he had to either follow through on the deal with the Taliban he inherited from President Trump or fight the Taliban, according to the New York Times.

Earthquake in Haiti

Haiti was already trying to cope with the aftermath of the 2010 earthquake and the murder of President Jovenel Moïse in July. Now, another earthquake has hit, the death toll of which has now increased to more than 2,200 people. The government also estimates that around 10,000 more people have been injured. Heavy rains have made rescue missions difficult and the people are turning to local churches for support.

Elections in Zambia

Hakainde Hichilema, the leader of Zambia’s main opposition party — the United Party for National Development — won the presidential elections, receiving 59.38% of the votes. His main opponent, Edgar Lungu, who was the previous President, received only 38.33% of the votes. It is only the third time in Zambia’s history that an opposition leader won the election.

Other News

  • Amazon has taken over Walmart’s position and become the world’s largest online retailer operating outside of China, according to the New York Times
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Weekly Summaries

9th of August – 15th of August

The Taliban take over Kabul

On Sunday, the Taliban took over Kabul, Afghanistan’s capital city. The U.S. has had a heavy military presence in Afghanistan for twenty years, which now came to an abrupt ending. The collapse of Kabul comes a lot faster than even many experts had expected, meaning that most Afghans now have no way of getting out. President Ashraf Ghani fled the country to Uzbekistan after the finance minister already fled last week. Since then a council of Afghan officials has opened negotiations with the Taliban to discuss the takeover, according to the New York Times. Troops from the U.S. and other Western countries, which had been stationed in Afghanistan, started withdrawing in May. Around that time the Taliban started their offensive to take over Afghanistan. What the future of Afghanistan and the people who live there will look like remains uncertain, but prospects point to the worst.

Other News

  • Michael Calvey, an American businessman, was sentenced to a suspended sentence “for embezzlement charges” for 5 and a half years, according to the New York Times
  • After facing accusations of sexually assaulting 11 women, New York’s Governor Andrew Cuomo has resigned
  • The cost of coffee beans is up by almost 44% in 2021 compared to 2020, according to the New York Times

Categories
Weekly Summaries

26th of July – 1st of August

Chaos in Tunisia

The President of Tunisia, Kais Saeid, tried to seize power in what some call a coup. He announced that he would fire the prime minister and has already suspended Parliament. However, so far it seems that his success is very limited, although many Tunisians expressed their support. Tunisia has been a democracy since the Arab Spring revolutions.

Other News

  • A landslide in India killed 9 people, most of them tourists. Furthermore, monsoons on the western coast have also killed more than 164 people so far.
  • France has been witnessing many protests against the so-called “Covid Pass” policy
  • North Korea and South Korea have — after 14 months of silence — reopened diplomatic and military hotlines between the two countries
  • Flash floods in Afghanistan have killed at least 80 people, but the search for survivors still continues
  • President Biden announced that EU citizens will continue to be barred from entering the U.S., citing fears that the Delta variant would be spread, despite the fact that U.S. citizens are allowed to enter EU countries, as long as they are fully vaccinated
  • Forest fires in Turkey and wildfires in Greece have had devastating consequences for the people living in the surrounding areas

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