After central planning: The restructuring of state industry in Bulgaria's Bourgas region

Industrial regions in eastern Europe developed under central planning are now confronting the pressures associated with political and economic transition to market‐focused systems. Using the case of the Bourgas region, on Bulgaria's Black Sea coast, the article examines how state industries are faring in these new conditions, analyzing developments in production, employment, ownership, management, market‐orientation and other factors. Massive financial and human resources were poured into the region's industrial development during more than four decades of state socialism, building a modem industrial infrastructure, but one heavily characterized by the particular features and constraints of central planning which emphasized quantity over quality and large‐scale, integrated plants. As central control collapses, the region's state‐owned firms are in crisis. Production is down, unemployment has risen, and except for a handful of plants restituted to former owners, privatization is moving slowly. The region's industries have been battered by highly unfavorable outside forces, yet have been mostly unable to marshal the necessary management, financial, or technical resources to implement coherently any indigenous strategic initiatives to address the changed institutional environment and new supply and demand conditions.     

Transatlantic Generosity: Canada's ‘Billion Dollar Gift’ to the United Kingdom in the Second World War

On the basis of research in Canadian, British, and US records, this article examines the development and implementation of the most generous financial act in the Second World War: Canada's billion dollar gift to the United Kingdom in 1942. The origins of this extraordinary measure, the political and economic factors that influenced its introduction, and the reasons why its replacement differed so markedly in format even as it replicated the fundamental purposes of the gift, are all assessed within the context of Canada's economic relations with Britain and the United States. As this analysis demonstrates, the gift advanced Canada's enlightened self-interest and bolstered the war effort of its oldest and closest ally. It was an economic success but a political failure; how it was perceived and depicted in Canada ensured that it would not be repeated, even though the conditions and requirements that necessitated the gift had not changed and equivalent measures had to be implemented.     

Geographical Takes on Three Decades of Economic Reform in Australia

The idea of an economy taking a geographical journey highlights the importance of changing spatialities and how these shape and result from economic change. It also focuses on the geographical scaling of key processes. Using these insights, this paper explores three decades of economic change in Australia in which the nation State has played a central role in the operation of markets and accumulation processes, albeit with dramatic shifts in the qualitative nature of that role. Such shifts have been crucial during the emergence of Australia's particular variety of neoliberalism. The paper explores the liberalisation of Australia's financial and corporate environment, trade policies and the industrial relations environment. The three cases suggest contradictions inherent in the State's adherence to a neoliberal reform agenda, in the name of globalisation, while facing: first, political needs to retain sovereignty over national security and tighten border protection; and second, multi‐scaled political processes including clashes with State governments grappling with regional and local impacts of change. There has been no simple roll‐out of neoliberalism in Australia since the mid 1990s. Geographical scales, constructed contingently by social and political agents, have contributed in fundamental ways to the power and direction of economic reform. Despite powerful re‐scalings to both global and local levels over the past three decades, there is no evidence of a diminished role for the nation State.     

The (Ineffective) Financial Statecraft of China's Bilateral Swap Agreements

Since 2008, the People's Bank of China has signed bilateral swap agreements (BSAs) with 35 foreign central banks. Collectively, these deals amount to nearly US$ 500 billion in Chinese renminbi (RMB) available to Beijing's foreign partners. What has led China to be so aggressive in its efforts to sign so many swap agreements? What are the political economic implications of the swap programme for the US‐centric global economic order? China's BSAs can be understood as a form of financial statecraft: the use of national financial and monetary capabilities to achieve foreign policy ends. China has deployed BSAs for both defensive and offensive reasons. Defensively, Beijing has sought to use BSAs to promote trade settlement in RMB thereby reducing China's vulnerability to the dollar's structural dominance in trade. Yet, as explained in this article, they have been ineffective in this regard. Offensively, Beijing has used BSAs as a short‐term liquidity backstop outside of the Bretton Woods institutions for partner countries in need. Here, there is greater potential for BSAs to impact the status quo economic order by enhancing Chinese economic influence. However, their potential is dependent on Beijing's willingness to act as a unilateral crisis lender and its ability to further internationalize the RMB.     

Reconstructing an urban and regional political economy: on the state,politics, scale,and explanation

This paper begins from the premise that a number of now fashionable institutionally focused accounts of urban and regional political economy often begin at a point that is analytically flawed (or at least partial) in that the institutional ensembles themselves—whether analyzed as an urban `regime', regional `thickness' or a local `regulatory mode'—are automatically assumed to be a pre-given part of the explanation. However, the authors contend that for a deeper analysis of urban and regional political economy to be advanced, these institutions themselves need to be explained. In order to proceed with such an explanation three key factors require more serious consideration. These are: (1) the need to outline one's chosen research object of enquiry, and all that this entails in terms of research methodology, theory selection, and an uncovering of the `constitutive properties' of causation; (2) a greater readiness to analytically interrogate the relational interplay between economic development, political governance and scale; and (3) an obligation to pay due respect to the politics of representation and active processes of state restructuring and political strategizing through and around which economic development is itself constituted. In order to explore these themes, the authors draw, variously, on a methodological (re-) reading of the regulation approach, recent theoretical innovations on the `politics of scale', Jessop's state-theoretical writings and his recently developed neo-Gramscian methodology for analyzing urban economic governance, alongside Jenson's political sociological approach towards the `politics of representation'. Where appropriate, they explore, briefly, ways in which these theoretical themes may be deployed in empirical research, by considering certain restructurings in and of the political economy of Britain during recent decades.     

Petztorme Women: Responding to Change in Lihir,Papua New Guinea

The goldmining project on Lihir Island in New Ireland Province, Papua New Guinea, has brought dramatic socio‐economic changes. In this matrilineal society, while women's economic contributions were substantial, their political status was not. Women's participation in decision‐making about the mine has been restricted, mainly because men have excluded them. The mining company established a women's section that has supported the development of women's organizations and a range of economic development projects. The women's organizations provide the context for new political roles for women but have experienced many setbacks that are common in such groups across Papua New Guinea. Through the Lihir experience in the first five years of the mine, this paper examines the tensions and divided loyalties that constrain women's organizations and often lead to the failure of income‐generating women's projects in Papua New Guinea.     

The sustainability and some consequences of Chinese economic growth

During the past 27 years, China's economy and relationship with the outside world has been transformed. The magnitude of annual economic growth and rapid increase in the volume of output of goods and services raise unsettling questions about potential threats to the sustainability of current growth levels and implications for economic and political stability. This paper examines the sources of economic growth and concludes the strong state system, high rates of saving and investment and demographic structure will sustain growth. Chinese authorities must be aware that a failure to maintain the process of financial and political institutional reform or to address the widening regional income inequalities poses potential domestic threats to sustainable growth. Tensions remain in China's international relationships, forcing China to consider further adjustment and accommodation in its regional security and economic relationships.     

Military dominance in Pakistan and China–Pakistan relations

ABSTRACT

The China–Pakistan Economic Corridor (CPEC) has been touted as the centrepiece of China’s Belt and Road Initiative and the key to its strategic partnership with Pakistan. Notwithstanding claims about the CPEC’s economic potential, however, Islamabad’s economy continues to be dire. This article attempts to better understand the ramifications of Pakistan’s economic viability and its consequences for China. It does so by examining China–Pakistan relations from the lens of Pakistan’s civil–military relations, paying attention in particular to what the Pakistan Armed Forces (PMA)’s domestic dominance means for China’s interests, including economic interests, in Pakistan. We suggest that PMA preponderance and its attendant influence on the country’s economic performance bring another dimension to interpreting Sino-Pakistani relations. As Beijing’s most trusted political partner in Pakistan, the PMA’s local dominance has considerable benefits for China, particularly in the security and political aspects of its interests. However, this dominance also entails a number of complications for Chinese economic interests, a factor that has implications for the future of China’s CPEC investments and their financial sustainability.     

Economic statecraft in China's new overseas special economic zones: soft power,business or resource security?

China's rapidly growing economic engagement with other developing countries has aroused intense debates, but these debates have often generated more heat than light. The Chinese government is clearly pushing its companies to move offshore in greater numbers, and state‐owned firms figure prominently in many of the major investments abroad. Yet relatively little research exists on when, how and why the Chinese government intervenes in the overseas economic activities of its firms. China's state‐sponsored economic diplomacy in other developing countries could play three major strategic roles: strengthening resource security, enhancing political relationships and soft power, and boosting commercial opportunities for national firms. This article examines China's programme to establish overseas special economic zones as one tool of Beijing's economic statecraft. It traces the process by which they were established and implemented, and investigates the characteristics of the 19 zones initially selected in a competitive tender process. The article concludes that even in countries rich in natural resources, the overseas zones were overwhelmingly positioned as commercial projects. Particularly in the Asian zones, China is following in the footsteps of Japan. The zone programme, and the Chinese foreign investment it hoped to foster, represents a clear case of the international projection of China's developmental state. However, in Africa (but not generally elsewhere) discourse surrounding the zones publicly positions them as a transfer of China's own development success, thus potentially enhancing China's political relationships and soft power on the continent.     

Local autonomies and economic development in Italy's incomplete transition

Since the 1990s Italy's autonomous local governing bodies have experienced important changes in their powers and functions in ways that have been shaped by national and international developments. The two decades of Italy's ‘transition’ have seen structural changes in the system that enabled the country in the second half of the twentieth century to take a place at the centre of the world economic system. But the evidence of the last two decades indicates that the changes that have taken place do not constitute a transition, but reveal instead a country that in terms of its politics and the economy is living an extremely diversified and complex phase of its history. This essay explores these processes at the level of the provinces and local government, showing how their capacity to contribute, locally and nationally, to growth through increasing territorial competiveness has been hampered by uncertainties resulting from the reforms that have been introduced and by growing financial restrictions.     

Transcarpathia—Bridgehead or Periphery?

This paper surveys the economic and political prospects of multiethnic Transcarpathia Oblast, a borderland region that historically has frequently changed political affiliations and which in 2004 will form a part of Ukraine's border with the European Union. More specifically, the analysis focuses on factors that have shaped the region's identity, the extent to which its current economic potential has been effectively utilized, whether its relative location confers upon it the potential to serve as a bridgehead between Ukraine and European political and economic structures, and implications of EU enlargement and Ukraine's macro-political orientation for the region. Journal of Economic Literature, Classification Numbers: F20, J61, 018. 4 figures, 2 tables, 44 references.     

The accountability of para-governmental organizations (bonyads): the case of Iranian foundations

This paper attempts to explain the emergence and development of para-governmental organizations (bonyads) in Iran and demonstrate their contradictory position in the Iranian political economy. These organizations represent the dual power structure in Iran which reinforces the financial authority of religious leaders without accountability. By analyzing the functions of these organizations, the paper sets out to probe their economic policies in line with the government's populist macroeconomic policies. The paper demonstrates the adverse effects of these organizations on political development and economic reforms in the post-Khomeini era when the struggle for accountability soared.     

Market Creation by Leninist Means: The Regulation of Financial Services in the People’s Republic of China

Abstract

Within the process of China’s transition from a centrally-administered to a more market-oriented economy, financial services have played a very special role, but in a counter-intuitive way: what looks like Western market economics turns out to be a Leninist regulatory model. Even as international financial service providers and regulatory communities are invited to play a role in the creation of a Chinese market in financial services, the Communist Party has strengthened its control of top personnel, the judiciary and the media. The reform of the central bank and the establishment of technically independent regulatory agencies seemed to have taken China down the path of OECD economies. The model of a very specific post-regulatory state with Chinese characteristics, however, has not fully incorporated the notion of private authority. Such an acceptance would pose a threat to the CCP monopoly on political power. The attempt to use only semi-private organisations to develop financial markets undermines the long-term stability of the political and economic order.     

Clarendon,Cavour, and the Intervention of Sardinia in the Crimean War, 1853–1855

The notorious arms trader Sir Basil Zaharoff is remembered as the archetypal ‘merchant of death’. During the First World War, he is alleged to have exercised a malign influence over statesmen in London and Paris. Recently released Foreign Office files now allow us to document Zaharoff's wartime activities on behalf of the British government as an agent of influence in the Levant. The new sources reveal that Sir Vincent H.P. Caillard, the financial director of the arms-maker Vickers, played a key role in making Zaharoff's services available to prime ministers Asquith and Lloyd George. While Zaharoff has often been portrayed as a sinister force, manipulating statesmen into pursuing his financial and political interests, the reality was the reverse. Zaharoff was a convenient tool of two prime ministers rather than a powerful political manipulator in his own right.     

Economic Restructuring,Coping Strategies and Social Change: Implications for Institutional Development in Africa

Since the early 1980s, most African countries have experienced unsatisfactory rates of economic growth and profound changes in livelihood systems, which have affected the way their modern institutions function. However, when confronted with evidence of poor economic performance in countries undergoing adjustment, the international financial institutions often blame governments for their lack of political will in regulating the activities of bureaucrats and vested interests. They recommend policies aimed at restructuring public sector institutions through privatization, public expenditure cuts, retrenchment, new structures of incentives and decentralization. Despite efforts to implement these measures in a number of countries, the problems of low institutional capacity remain. Two key contradictions appear to explain why institutions have been largely ineffective in crisis economies in Africa: the growing contradiction between the interests of bureaucratic actors and the goals they are supposed to uphold; and the contradiction between the institutional set-up itself and what goes on in the wider society. To understand how these contradictions work, it is necessary to look more closely at the set of values and relationships that anchor institutions on social systems. The issues here are social compromise and cohesion; institutional socialization and loyalties; overarching sets of values; and political authority to enforce rules and regulations. The crises in these four areas of social relations, which are linked to the ways households and groups have coped with recession and restructuring, have altered Africa's state institutions so that it has become difficult to carry out meaningful development programmes and public sector reforms without addressing the social relations themselves.     

Russia's economic agenda to 2020

Since the disintegration of the Soviet Union the role of Russia in international relations has been in flux—a reflection of its changing capacities, positions and interests. To a certain extent, this variability has been defined by the Russian economy, which in the 1990s passed through a stage of deep structural transformation and severe financial crisis, but which then benefited from a period of fast and mainly stable economic growth in the first years of the twenty‐first century. Now, the serious economic decline as a result of the global crisis of 2008–2009 has been replaced by an unstable and uncertain recovery. In the 2000s a very specific political regime of personalized power under Vladimir Putin—set to be back as president in 2012—was established in Russia. During his next term Putin will face the most serious challenges to Russia's economic policy yet. According to some scenarios, these challenges could significantly destabilize the country's politics and economy. Russia is facing a demographic trap; the ageing of the population is increasing the pension burden on the budget, while the shrinking labour force will surely become an obstacle to growth. The dependence of the budget and balance of payments on the price of oil has grown so great that even price stabilization becomes a threat to macroeconomic stability. The poor quality of the investment climate leads to falling private investment which, in turn, hinders the much‐vaunted modernization of the economy. If combined, these problems will lead to the widening of the gap in technology and living standards between Russia and developed countries. Elimination of political competition and the impossibility of replacing political leaders through elections have led to widespread corruption and abuses, crony capitalism, and the complete undermining of the independence of the courts and law enforcement which further complicates the search for adequate responses to the mounting economic challenges. As there are no reasons to believe that Vladimir Putin is going to reform the country's current political system, the gradual accumulation of economic problems could well become the main threat to his presidency as Russia heads towards 2020.     

Behind the Cold War: rethinking the left,the state and civil society in Italy (1940s-1970s)

This article stresses the longue durée features of the Italian political system. It examines the role of two historical factors: (1) the existence of some peculiar (and quite 'sophisticated') state financial institutions; (2) the influence of certain long-enduring social traits (regional differences, family values, the Catholic Church, political religion) on the relationship between state and citizens. It discusses the specificities of the Italian political system (with its historical Fascist heritage and the biggest Communist Party in Europe) and the reaction of the political elite (especially on the left) to international developments in the 1940s and the 1970s, since these years (of the economic 'miracle' and the origins of Italy's political 'landslide') offer the best comparison of Italy with other European countries. These two periods also enable us to examine the Communist Party's (PCI) crucial contribution in the two worst times of national crisis: the post-war years and the years of terrorism. The first part of the article examines the heritage of Fascism and how Italy's new political elite exploited it to strengthen the country's political and economic position after the war. The second explores how behind the Cold War the mass parties helped the country to expand in the international market by controlling social conflict. The third draws some conclusions about the 'success' of the 1940s and the heavy legacies that contemporary Italy has inherited from the 1970s.     

Italy and the World Bank: The European Foundations of Development Lending, 1947–51

Foreign financial assistance for economic development and the discipline of development economics have traditionally been associated with US Cold War policy toward the Third World. This article, however, suggests that these practices were also shaped by the experiences of foreign aid for European reconstruction after the Second World War. The article traces loan negotiations between the World Bank and the Italian government, and argues that this process played a substantial role in shaping not only the World Bank's lending policies, but also the way its staff understood the institution's mission. The article emphasises Europe's significance as a site in the early history of development, suggesting new ways of understanding the evolution of development ideas, practices, and institutions after 1951.     

The Fiscal-Electoral Nexus in Australia, 1976-94

This article re-evaluates existing political business cycle theory in the specific context of the political economy of Australian fiscal policy since the mid-1970s. Whereas 'traditional' political business cycle models, formulated within a Keynesian framework, assume a high level of state autonomy over fiscal policy, this article argues that an environment of fiscal restraint has been imposed on Australian federal governments over the study period. Given the historical dynamics of Australian economic policy which inform this study, a hypothesis is developed which reflects the policy optimisation dilemma which has confronted Australian federal governments when formulating fiscal priorities in a pre-election context. On one hand, there are pre-poll demands for expansionary fiscal settings from the electorate; on the other, there are demands from financial markets and domestic neoliberal interests for fiscal restraint. Reflecting the fact that identifiable costs are associated with implementing expansionary fiscal policy settings, it is hypothesised that such an approach will be adopted only in times of greatest political need, when an incumbent government is facing a popularity deficit in a pre-election context. While the study confirms that the fiscal-electoral effect is relatively weak, electoral demands do still influence the fiscal priorities of Australian federal governments. This is particularly so with the case of personal taxation relief, a policy approach that appears to be more acceptable to financial markets, key neoliberal interests and some segments of the electorate.     

Spatial processes and politics of renewable energy transition: Land,zones and frictions in South Africa

This paper seeks to make a contribution to on-going debates about how to conceptualise the spatial processes of renewable energy transition. It makes a case for understanding renewable energy transitions as simultaneously spatial and political processes, constitutive of new territories and configuring development pathways. Drawing on a case study of South Africa's Renewable Energy Independent Power Procurement Programme (REI4P), the paper explores the ways in which energy transitions are intrinsically bound up with both the materiality and the historical and contemporary politics of land. It then examines the relationship between energy transitions and territory to conceptualise the ways in which transitions take on an experimental shape in the form of 'zones'. The paper argues that these zones are new territories deploying forms of spatial and political-administrative exceptionality, which allow political and economic actors to exercise authority and commercial power. Two types of zone emerging from South Africa's energy transition exemplify these processes: legally-defined zones for the development of solar and wind energy and zones of socioeconomic development required by REI4P. The paper explores the spatial and political consequences of these strategies and suggests that these may not necessarily translate into conflict and confrontation, but instead produce uneasy co-existences of different political, social and spatial projects and interests, with potential to create new polities.