Over the last 30 years, Malaysia has miraculously grown into a middle income country, transforming itself from a primary producer of minerals and commodities, to a multi-sector economy.
The Malaysian Government has skilfully attracted foreign investment in high technology industries like electronics, multimedia, medical technology, and pharmaceuticals, service sector industries like Islamic finance, and urbanized the country with a rich retail service industry. However, agriculture has been allowed to slip well behind the rest of these sectors within the economy.
This is normally the case when an economy transforms itself from the status of ‘developing’ to ‘developed’. However the case of Malaysian agriculture characterizes a number of mistakes. These mistakes have cost the country in terms of better food self-sufficiency, rural and community development, regional development, employment, poverty alleviation, and missed some of the great agro-based sunrise industry opportunities of this millennium.
What more, rural infrastructure and agro-based expertize is drastically lacking in Malaysia, since the Mahathir led drive to modernization back in the 1980s.
This is particularly dangerous with a gloomy global outlook ahead, where Malaysia must become buoyant enough to internally withstand any deep international recession approaching, if it is to stave off great hardship on its citizens.
According to Malaysian statistics cited over various Malaysian Plans, the agriculture sector in 1970 represented 28.8% of national GDP. As of 2013, agriculture represented only 9.33% of GDP. However in some states like Perlis, Kelantan, and Sabah, agriculture still makes up 20-30% of the total economy.
Employment in the sector has fallen from 13% of the total workforce in 2007, to only 9.3% in 2014. However 66% of the people involved in working within the agriculture sector are over 50 years old. The estate sector is primarily staffed with foreign labourers bringing little income benefits to local communities.
The bulk of Malaysia’s agricultural land is utilized for the production of industrial crops, which has risen from 2.1% in 1960, to over 87% of land use today. Palm oil and rubber dominate, with paddy production and declining cocoa production running far behind. Timber is still a major primary product, where reforestation is lagging behind, making the industry unsustainable. Sarawak for many years has enjoyed a successfully developed a pepper industry, and there are pockets of fruit and market vegetables, around the nation.
However, less land is being utilized for agriculture today, as it is more valuable for industrial and housing developments. The composition of industrial crops, and industrial and housing development for land is steadily driving up the costs of food production in Malaysia. Paddy farming is also facing challenges due to declining productivity, increasing fragmentation of land plots, and poor response to changing consumer desires within the marketplace. Even the production of palm oil is expected to decline based upon recent industry predictions.
The push to industrial crops in the 1960s although rapidly developing the agricultural sector, rapidly decreased the diversity of agriculture within Malaysia. Even settlement schemes like FELDA and FELCA shied away from food and cash crops towards the palm oil and rubber because of the relatively large returns available with little need to market and sell their crops. As smallholder farmers have aged, with the youth reluctant to follow in their parents’ footsteps, the production of crops such as coconut, tropical fruits, vegetables, and other cash crops has been declining.
Estate production of industrial crops is now the mainstay of Malaysian agriculture, which is mainly in the hands of Malaysian Government Linked Companies (GLCs) like Sime Darby. Smallholders have been grossly neglected where little has been done by Malaysia’s agricultural research institutions and universities to modernize and develop appropriate technologies, new hybrids of cash crops, and assist in developing modern smallholder business models through the infusion of entrepreneurial thinking in rural communities. In addition, finance for smallholders is extremely difficult to obtain, and farm extension has all but died out two decades ago. The smallholders have been left to themselves, where they face acute labour shortages and little access to markets that would help make their efforts viable.
If one also factors in poor basic infrastructure such as access to irrigation and roads, the poor level of education of most smallholders, resulting in an attitude towards being production orientated rather than entrepreneurial, “conmen” taking advantage and promising big returns to smallholders if they buy seeds from them, and the condescending attitude many government bureaucrats have towards small holders, it’s not hard to understand why this sector is so much in decay.
The Malaysian agriculture situation has reached a point where the estate business model that was once so successful for the production of commodity crops is now stagnating. Malaysia is losing its dominance as the major producer of palm oil, and palm oil itself is under threat from international health concerns, and also concerns from the international community about the environmental record of Malaysia’s palm oil producers. Rubber prices are facing a slump, and paddy production is primarily insufficient to feed the total population, i.e., 35% of Malaysia’s rice needs to be imported from Myanmar, Thailand, Vietnam, India, and Pakistan.
There is little evidence to see where local communities have benefitted from the presence of Malaysian GLCs, yet state Governments have been eager to transfer state land to them for development with virtually no transparency. Picturesque pieces of virgin jungle are still being ripped up to make way for new palm plantations, to replace those developed into housing and industrial estates, where the GLCs are making mega-profits.
Malaysia’s agricultural direction was planned through a series of 5 year plans. The Malaysian political/bureaucratic elite have always presented rosy forecasts and gained publicity through staging MOU ceremonies, to announce projects which never happen, or fail through mismanagement.
Part of the problem in the Malaysian agriculture sector is that the politicians and bureaucrats have been thinking big, at the cost of thinking small. For example, the Ministry of Agriculture has developed a list of agro-based industries that should be national priorities. The Malaysian Agricultural Research and Development Institute (MARDI), and the Forest Research Institute of Malaysia (FRIM) restrict their research to these national priorities, while leaving a void in research on crops needed to spur on the growth and development of small local communities. Consequently, Malaysia’s research efforts have benefitted few communities, which still remain in relative poverty today, particularly in the agricultural dominant states like Perlis, Kelantan, Sabah, and Sarawak. There are a lot of potentially viable crops that should be researched and developed, but are being ignored.
Institutions like MARDI and FRIM have become showpieces to please the politicians.
Further, the bureaucrats involved in these plans implementation have appeared to lack the zeal and commitment to see these plans progress into reality. Managers on the ground have focused upon building hard infrastructure where favoured contractors can be employed to build these projects and facilities, rather than ploughing resources and money into education and extension. The result has been a number of ‘white elephants’ that litter the country.
Corruption, via land grants, misallocation of funds, and building irrelevant facilities, is a major issue hampering effective rural development in Malaysia today.
Malaysia, as an economy skewed towards state planning and intervention has attempted to “pick winners” and develop them through the state apparatus. In the case of herbs and biotechnology, massive funds were allocated in the pursuit of achieving success in these “sunrise” industries, where the funds were predominately channelled into developing ineffective and costly bureaucracy.
The Malaysian Herbal Corporation was formed in 2001 with much fanfare, where it was considered within the bureaucracy to be the driver and ‘flagbearer’ for the industry. The corporation undertook many initiatives, with the staff travelling widely and luxuriously around the world. Today, the Malaysian Herbal Corporation is now defunct.
With former Malaysian Prime Minister Abdullah Ahmad Badawi’s focus on biotechnology as a ‘sunrise industry’ midway last decade, the Malaysian Biotechnology Corporation (MBC), along with various state funded biotechnology companies such as Melaka Biotech, J-Biotech in Johor, K-Biocorp in Kedah, and Kelantan Biotech, were all well-funded with hundreds of millions of Ringgit in grants, but have little, if anything to show for it. Most of, if not all of the grants given out by MBC to commercial companies failed to produce any commercialized intellectual property, as university research also failed to do.
Technology Park Malaysia (TPM) built biotech labs around the country in places like Perlis, which are mostly empty. The East Coast Economic Regional Development Council set up herbal parks in Pahang and Terengganu which are basically inactive in regards to their original purpose.
FELDA opened up the FELDA Herbal Corporation which is now replaced with another attempt at developing biotechnology through Felda Wellness. Biotropics was set up by Khazanah Coropration and is basically only producing some cosmetic and herbal products. The Ministry of Health set up NINE BIO to produce Halal vaccines and herbal products.
The Malaysian-MIT partnership hailed as being an example of a smart-partnership, cost the Malaysian taxpayer USD20 Million with absolutely nothing to show.
The Malaysian Government rather than be a driver of the industry became a participant with drastic results.
Just about all these Government interventions into business have failed dismally, losing hundreds of Millions of Dollars for the Malaysian taxpayer.
What is tragic is that there has been no transparency in the way the Malaysian Government handed over responsibility to personnel within these government corporations, and no accountability.
Top down planning with no consultation with local industry, local communities, and local scientists, has led to Malaysian agriculture falling well behind its neighbours within the Asian region. Top down planning has allowed bureaucracy to overrun market considerations in Malaysia’s agricultural and agro-based industry development.
Development programs like the agropolitan schemes in Sabah are conceptualized and developed within the bureaucrats’ paradigms. GLCs are asked to take up large swabs of land, plant palm oil, and develop a small corridor for local villagers. They have been of large benefit for these GLCs, but local villagers have been short changed where GLCs partaking in these projects fail to live up to their responsibilities.
Likewise, other bureaucrat concepts such as combining fragmented land holdings into paddy estates run by anchor GLC companies, as promoted by the Performance Management Delivery Unit (PEMANDU) within the Prime Minister’s Department disempower local land owners who are expected to work as labourers on their own land. These types of projects have failed in their conceptualization, let along during the implementation stage.
As a consequence opportunities to alleviate poverty in rural communities have been missed, and opportunities to develop new crops, and create new industries have been ignored.
Many successful programs like entrepreneurship mentorship schemes run at Agricultural Institutes around the country, are starved of funds, because of the preference for the bureaucratic ‘white elephants’ that benefit policy implementers financially.
Malaysian agriculture is now in crisis and there is a need to reinvigorate the sector, particularly with the expected global economic slowdown.
Malaysia is currently importing up to 60% of its current food needs. With the level of national debt, falling foreign reserves due to a low Ringgit, and a potential slow-down in exports due to a sluggish international economy, food self-sufficiency may become more important than ever.
Food self-sufficiency would create an important buffer for rural Malaysia to withstand any deep recession. Without food self-sufficiency the population within the Malay heartlands will suffer immensely. As mentioned, Malaysia imports much of its rice needs, milk, beef and mutton, flour, and fruits.
Within this problem, lays an opportunity. Malaysia’s Neighbour Thailand has been reinventing itself as the ‘kitchen of the world’. Malaysian agriculture with modern farming methods, utilizing appropriate technology, and adopting new branding paradigms through merging GAP and Halal practices into say a “HalalGAP” protocol could enter and prosper in the rapidly growing Halal market worldwide.
Malaysian agriculture needs new farming practices, business models, and reinvented supply/value chains. The decline of the value of the Ringgit will help Malaysian farmers find a new era of competitiveness that the sector has never had.
Now is the time to take this opportunity.
Ready for the Dry Years: Building Resilience to Drought in Southeast Asia
Authors: Armida Salsiah Alisjahbana and Lim Jock Hoi*
South-East Asia has long endured severe droughts, which occur on average every five years. The prolonged 2015 and 2018 droughts were the worst on record for two decades. They simultaneously affected more than 70 per cent of the land area, with over 325 million people exposed. No ASEAN member States was spared from the devastating impacts including the disruption to livelihoods and food security, as well as forest fires and haze.
The drivers of drought risk in South-East Asia are inherently complex, resulting in considerable year-to-year variations. Drought is heavily influenced by various climatic drivers, mainly the El Niño-Southern Oscillation (ENSO) and Indian Ocean Dipole (IOD). Yet, despite this complexity, clear trends point to an intensifying drought risk across the region.
New analysis of observed data and climate projections in the second edition of Ready for the Dry Years: Building Resilience to Drought in Southeast Asia, a joint report by the United Nations Economic and Social Commission for Asia and the Pacific (ESCAP) and Association of South-East Asian Nations (ASEAN) reveals a statistically significant increase in temperature from 1981-2020, that is expected to continue. This means that drought severity will increase as the climate gets warmer.
This urgency has been enhanced by the COVID-19 pandemic, which has converged with the climate crisis. Both disasters have simultaneously disrupted people’s health, livelihoods and supply chains across the region. These compounding impacts have led to severe economic stress and undermined the ability of the region to deal with current and future disaster risks. It is crucial that we understand how recurrent droughts and the current pandemic are interacting, to identify appropriate policies that can address these crises simultaneously.
ASEAN and ESCAP are working together to prevent the destructive impacts of droughts by promoting a paradigm shift towards more adaptive drought risk management and governance. This cooperation is anchored in a forward-looking, science-based approach to drought risks. The adaptive policy interventions must support the most vulnerable and those furthest behind in the region.
The latest evidence shows that 15 to 25 per cent of the region’s population lives in drought hotspots, with low levels of socio-economic development and high exposure to recurring droughts. Targeted policy interventions in these areas will be essential to prevent the cumulative impacts of recurring droughts, which over time, pose a serious threat to hard-won development gains, particularly the achievement of the Sustainable Development Goals. These interventions must follow three clear policy tracks to reduce and prevent droughts from occurring; prepare and respond to droughts when they happen; and restore and recover after a drought has passed. Accordingly, they should cover a wide range of policy areas, from the management of food, water and energy systems, to the implementation of early warning systems and drought risk financing.
Governments should capitalize on several opportunities to meet this challenge. Firstly, the cyclical and slow-onset nature of drought provides time for us to take risk-informed actions now, to prevent a drought hazard from becoming a crisis. Secondly, governments can benefit from ASEAN’s extensive experience and expertise through greater regional cooperation, driven by ASEAN’s agenda on drought and the newly adopted ASEAN Declaration on the Strengthening of the Adaptation to Drought. Thirdly, the COVID-19 pandemic offers an opportunity to act now to reduce the impacts of future droughts, by incorporating measures to build resilience into COVID-19 recovery stimulus packages.
The latest developments in science and technology will underpin the successful scale up of drought management interventions. ASEAN member States must take concrete steps now to strengthen national and regional drought monitoring and improve our understanding of the causes of drought. It is now more vital than ever for the region to build resilience to drought. By working together, we can mitigate the impact of future droughts and ensure that the entire ASEAN Community will be ready for the dry years ahead.
On this note, strong partnerships between the United Nations, ASEAN and national governments and other stakeholders are essential to deal with the increasingly complex and uncertain extreme weather and climate situations along with the impacts of transnational slow-onset disaster risks. ASEAN and the United Nations has enjoyed fruitful cooperation through implementation of the Comprehensive Partnership and the Plan of Action. This joint ASEAN-ESCAP work has reflected our cooperation and partnership for the benefit of our peoples.
*Lim Jock Hoi, Secretary-General of ASEAN
Cambodia’s Hun Sen, Asia’s longest-serving PM, continues to quell the Opposition
For the past 35 years, the former French colony of Cambodia is ruled by the 68-year-old Prime Minister Hun Sen, Asia’s longest serving head of the government. His policies are regarded as autocratic, aimed at forcibly limiting the scope for the Opposition to rise politically and come to the forefront of democratic activism.
The latest in line of such policies is the politically-motivated mass trials of more than a hundred members and supporters of the banned Cambodia National Rescue Party (CNRP).
The 2012-founded CNRP’s unexpected success in the polls of 2013 and 2017 was seen by Hun Sen and his ruling Cambodian People’s Party with trepidation. The democratic opposition party’s performance came amid sustained pressures of intimidation and electoral malpractice.
The CNRP was the only opposition represented in the country’s National Assembly or lower house of the parliament, with 55 out of 123 seats, until November 2017 when the pro-Sen Supreme Court ruled to dissolve the party, ending its five years of existence.
ASEAN Parliamentarians for Human Rights referred to this arbitrary move as the final nail in the coffin for Cambodian democracy. Also, CNRP’s leader Kem Sokha was arrested on fake charges of treason, accusing him of conspiring with the US to overthrow the prime minister and his government, a claim which Washington has categorically rejected.
Strikingly, these moves came ahead of the 2018 election. In the absence of an effective Opposition, Hun Sen’s CPP unsurprisingly won 100% of parliamentary seats in the last elections held in July 2018.
Meanwhile, Sen’s biggest political rival during his three-and-a-half decade rule, Sam Rainsy, has been living in exile in Paris for the past fifteen years. Last year, he was planning to return to Cambodia along with other senior opposition figures via Thailand, but was denied boarding on the Thai flight due to Cambodian threats to the airlines.
However, to Sen and the CPP’s dismay, in January 2020, some former members of the CNRP and other democratic activists announced the formation of a new party named the Cambodian Nation Love Party (CNLP) to continue the CNRP’s legacy and participate in future elections.
The Cambodian people’s undying quest for democratic reforms was exemplified with the formation of a new democratic party. Sen’s previous attempt to prevent the erstwhile CNRP from reconstituting itself under another name, by banning more than 100 of its leading members from politics for a period of five years thus failed to reap sustainable gains.
As the suppression of democratic expression continues for a long time now, relations with the West have deteriorated in the past few years, pushing the ASEAN country further into Beijing’s orbit. The US is also watching the trial closely. Meanwhile, the European Union, a key export destination for Cambodia, has withdrawn special trade privileges given earlier.
Now, the recent summoning of 140 ex-CNRP members and supporters, for charges of conspiracy and attempting to overthrow the government, is the latest political drama in the long set of desperate moves from Hun Sen to cling on to power.
Among those who showed up in court include former opposition senator Thach Setha and Cambodian-American human rights lawyer, Theary Seng. But, there are many who fled into exile believing that they would not be given a fair trial.
Cambodia, bearing the painful memory of a genocide that happened under Pol Pot’s notorious Khmer Rouge regime in the late 1970s killing 2 million people, saw the country slipping into the hands of another would-be autocratic leader, Hun Sen, in 1985.
The interventions by the United Nations and other human rights-oriented organisations appear to be failing in the Southeast Asian nation as long-established democratic processes drift away and elections are held for namesake, adding up to the political drama. With Sen unwilling to forfeit power, the future prospects for Cambodia seem to be a dreary continuation of the past.
The 2020 Myanmar Election and China: Push and Pull factor in ‘Paukphaw’ friendship
National Democratic League (NLD), the ruling party of Myanmar under Daw Aung San Suu Kyi had a landslide victory in the election, which led the party to continue in power for another five years. While Myanmar still struggling with the civil war crisis and without any solution-oriented approach the crisis in Rohingya is nowhere near to end since the breakout of the severe crisis in 2017.
The pre-election and post-election international media coverage and scholarly discussion on Myanmar bring back the China factor in the Myanmar election and general China’s undeniable ties with Myanmar. It’s been argued that a vote for Aung San Suu Kyi would mean the continuation of the unprecedented expansion of China in the country and a vote for multi-ethnic parties would mean resistance to China-backed infrastructure and other projects.
While the backlashes against China among multi-ethnic parties and towards China-led infrastructure projects are omnipresent in Myanmar, however, China has not loosed its heart to engage in the Myanmar peace process. It is also to be noted that China does not only have good relation with NLD but it also keeps its relationship with the military-backed Union Solidarity and Development Party (USDP). It also frequently engages itself in discussion with ethnic groups. What China likes to call itself is a “neutral player”. Thus, the election results would not have a significant impact on the China-Myanmar relationship.
The irk of Western countries towards Myanmar, who initially supported Myanmar’s democratic transition only intensified with the 2020 election as the Myanmar election commission only allowed election in 8 townships in Rohingya state, and denied election in 9 other townships. A joint statement was issued under the leadership of the UK and the US regarding the inclusion of left out Rohingyas into the election along with urging Myanmar to be more serious regarding the global ceasefire and confidence-building steps that include lifting restrictions on access to health, education, and basic services, lifting restrictions on freedom of movement. China’s as under the principle of non-interference abstained from commenting on the exclusion of nine districts in Rohingya state from the election. Chinese government since 2017 has blocked draft resolutions at UNSC regarding international intervention in the crisis in Myanmar. China, however bilaterally posited itself as a mediator between Myanmar and Bangladesh on the repatriation of Rohingyas. A role, China now often seems to play in conflict-ridden countries, for example in the Afghan peace process China plays a similar mediator role.
Myanmar’s foreign policy after 2015 and China
After the first democratic election in Myanmar in 2015, and NLD’s new manifesto was focused on upholding ‘an active and independent foreign policy’. Under the AngSyu Ki leadership, the foreign policy of Myanmar was considered to be hedging towards a neutralist foreign policy to work together for the benefit of the region on issues relating to regional organizations and programs. Another important pledge in Myanmar’s 2015 foreign policy manifesto was to “to identify and cooperate with other countries on joint economic enterprises of mutual benefit. In particular, to work together for the benefit of the region on issues relating to regional organizations and programs.” Which, as mentioned by Moe Thuzar of Singapore’s ISEAS-YusofIshak Institute is missing in the 2020 Manifesto. The reason for missing the important article from the 2020 manifesto could be Myanmar’s subtle attempt to balance China’s unprecedented presence in the region. As, it also aligns with some of the recent activities of other international actors in Myanmar. Such as high-level delegation visits by India, in October 2020, Myanmar’s growing interest in business engagement with Hong Kong, and eagerness to expand its economic co-operation with other Asian countries such as South Korea and Singapore. All this renewed interest within a span of two months from September to October 2020, before the election in Myanmar also could be an attempt to recover the focus in Myanmar’s democratic transition as opposed to growing clout over claiming Myanmar as an authoritarian regime, especially after 2017.
In terms of Myanmar’s policy towards China, Myanmar could not be seen as prey to China’s economic interest. As, even though the China-Myanmar Economic Corridor is kicking off, Myanmar is still apprehensive regarding embracing all of the Chinese lead projects. According to Irrawaddy times, from China’s originally proposed 40 projects, only nine projects were tentatively agreed to implement from both sides under China Myanmar Economic Corridor (CMEC).
AyungSyu Ki’s diplomatic shrewdness is evident in Myanmar’s China policy. The country despite using China as a shield to defend itself from international intervention, China has not completely able to unlock all economic leverages. China’s patience with Myanmar also relates to the fact of ensuring security in its border province.
Yang Jiechi, the head of the Central Foreign Affairs Commission of the Chinese Communist Party’s short September visit to Myanmar was an indication that China does not take Myanmar for granted to materialize the economic projects, it has started in the country under the banner of BRI, Especially after the 2017 launch of China Myanmar Economic Corridor. Before NLD came into power in 2015, the anti-Chinese sentiments in Myanmar were more prominent, as it has led to President Thein Sein to halt the Myitsone Dam in 2011. Scholars have argued that Myanmar’s skepticism over Chinese led projects between 2011-2012 could be seen as a reaction to its proximity with the West, as Western sanctions were slowly lifted for a brief period (Ganesan, 2017). Thus, as the Western sanctions grew after 2017, Myanmar hedged towards China. Even though, Myanmar is always dubious about China’s economic diplomacy in Myanmar.
However, Myanmar does return the favor to China diplomatically by recognizing the ‘one-China principle’. Myanmar’s President U Win Myint during the visit of Chinese President Xi Jinping in January 2020, states Myanmar’s firm adherence to the One China principle, respects the “one country, two systems” policy China has implemented in Hong Kong and Macao and has always recognized Taiwan as an inalienable part of China’s territory.
Myanmar is also one of the 53 countries that supported the Hong Kong National Security Law.
China’s multifaceted engagement in Myanmar
The question arises can Myanmar altogether keep China aside, especially from its peace process? As China’s border is at the stake, China is pretty much invested in Myanmar’s peace process. In the third Union Peace Conference, China played important role in pressurizing ethnic armed organizations (EAOs) to attend the peace conference. For China’s interest, the member of the Federal Political Negotiation and Consultative Committee (FNPCC) includes the Northern Alliance EAOs, which are known for attacking commercial interests in northern Shan State and Kachin state that shares a border with China. China-funded the EAOs to attend the conference, which was the first time all the ethnic groups attended it with Chinese aid and diplomacy. Thus, Myanmar can’t shun Chinese help when it comes to the peace process. As of August 2020, the fourth Union peace conference marked the absence of many of the ethnic groups as due to COVID and other factors China was not seen pushing much for their inclusion. Yun Sun noted that the reason could be the absence of any specific request of the Myanmar government to China regarding the same.
Apart from, engagement with the peace process and supporting Myanmar at the international front regarding the Rohingya crisis, and mediating between Bangladesh and Myanmar, China seem to have a resilient network approach towards Myanmar. This has led China to engage different actors in its diplomacy towards Myanmar. Chinese government NGOs (GONGO)’s such as the China International Poverty Alleviation Foundation (CIPAF), Blue Sky are becoming more present in Myanmar. These GONGO’s are not only providing humanitarian aid but also organizing skill development programs for locals. The Chinese government also sometimes organizes training programs for Myanmar’s diplomats and officials and businessman. Hence, China is more engaging at the grassroots level, a diplomatic style China has adopted from its experience of engagement in unstable states in Africa.
Thus, as for now, it is both a win-win game for China and Myanmar, as both seem to seek leverages from each other. However, it would interesting to see if more international actors, especially the US lifts the ban on Myanmar and get engage with the country how Myanmar would design its policies towards China.
The views expressed in this article are those of the author.
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