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Analysis of the Logistics and Energy Map of the Eurasian Transhipment Lines: Strategic North

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Abstract: Analysing the possible ways to solve the fundamental problem, the author emphasizes the importance of the largest land mass of the globe – Eurasia and transport logistics through it. The study provides an overview of potential CO2 mitigation targets for international railway and maritime transport. The author analyses three possible ways of developing Eurasian transhipment lines in accordance with green standards. The main problems and opportunities of railway roads, Southern warm congested waters are considered. Special attention is paid to the development of Northern waters transhipment lines between the most-producing countries of G-7 and advanced OECD markets.

Today the whole world is aware of the global problem of climate warming. Due to the increase in the concentration of greenhouse gases and harmful emissions into the atmosphere, this problem is getting worse every year. Air pollution occurs due to the development of industry, increased transport, and overall economic growth in countries around the world.

Thinking on the question how we can answer the fundamental challenge of global warming, we should understand that the most inhabitant part of the world and the largest landmass of the Globe is Eurasia. Thus, it is the biggest producer of CO2 and, hence, the most polluted part of the world. Also, important to underline that the biggest countries-producers (China) and countries-consumers (West Europe), producing the biggest economic output, are located on the edge of the Eurasia. These countries, which are states of G-7 (Atlantic states and other European countries) and other advanced OECD economies, drive world’s economies and may play crucial role in improving ecology and environmental standards.

It is equally important to emphasize that the most ambitious logistics and infrastructure project of today – “One Belt – One Road” – runs through the vast expanses of Eurasia. Transportation logistics between Far East and Western Europe is vital for world’s economic development, but today we do not have reliable technologies and transport lines. Due to this it is necessary to think on few aspects, which may determine the development of environmentally friendly economies in future:

–    reliable transportation (safe and environmentally friendly) ;

–    cheapest modes and transhipment lines;

–    fastest modes of transportation

Transportation aspect

The most reliable mode of the transportation is railway. It has certain advantages (compared to air and maritime transport) in the following areas: regularity (rhythmicity), reliability (guaranteed on-schedule delivery and cargo preservation) and the ability to deliver the cargo to any destination.

When comparing cargo transportation from the Far East to West Europe by sea and by rail, the delivery time is often the key argument in favour of the railway. At the same time, the amount of 14 – 15 days is often mentioned. In practice, it takes longer: 35 – 50 days by sea, 28 – 32 days by rail, 6 days by plane and 4 days by roads (See Figure 1). This difference in numbers is caused by the need to form a train, delays at some stations, etc.

Figure 1. Transhipment lines from Far East to Western Europe

Source: IFIMES, 2021

Underlining the reliability of the railway transhipment lines in terms of friendly environmental standards it is assumed that carrying a TEU between the Far East and West Europe using diesel trains would result in emissions of around 0.7 tonnes of greenhouse gas emission. However, the emissions from electric trains could be lower, possibly even falling to zero if they were powered entirely by renewable sources. This suggests that, by using railway mode, the Eurasian transhipment lines are likely to be beneficial to the environment.

While in theory, the implementation of railway electrification and the use of renewable energy sources can reduce greenhouse gas emissions, perhaps even to zero, in practice this process can take decades that our planet is unlikely to have.

This fact makes us think about other possible modes of transportation that are both “convenient” (speed, regularity, and accuracy of delivery), and beneficial to the environment.

The cheapest mode of transportation is by the sea, but it also has some pros and cons. Thus, the warm waters (red) shipping line from Far East to the port of Rotterdam in Netherlands today has great logistics prospects. Currently, 80% of cargo from China to Europe goes through the Atlantic Ocean to the ports of Northern Europe. The warm waters shipping line through the Arabian sea and the Suez Canal to the Balkans reduces the transport time by 7 – 10 days: this is so far the shortest sea route from Far East to Europe (however, to use it to its full capacity, CEE countries need to build the transport infrastructure that the region has a huge need for. This is especially true of the Balkan Peninsula and Ukraine, which are gradually entering a period of stable development after riots and wars that caused serious damage to infrastructure and the economy).

Another significant reason that slows down the speed of transportation, and thus increases CO2 emissions and reduces the level of „convenience” of warm waters transhipment lines – is the high level of congestion in reservoirs. The low cost and the higher degree of safety compared to transportation by land, has led to an increased number of commercial fleets over the past few decades. Thus, the biggest challenge is the problem of the high level of congestion in warm waters. Currently there are several maritime zones of bottlenecks (see Figure 2):

Figure 2. Main maritime shipping routes

Source: Dept. Of Global Studies and Geography, Hofstra University, 2018

  • The Straits of Malacca and Singapore (hereinafter SOMS) is the second most important global chokepoint, with over 16 million barrels per day (120,000 ships passes this route each year). It is a vital strategic region for seaborne trade since it is the shortest route between the Pacific and Indian Oceans. This narrow, 550-mile strait is also a major route for oil transportation, hence creating a danger of potential oil spills or collisions, significantly damaging the biodiversity and the marine environment. Moreover, the SOMS is polluted not only by the oil and ships, but also by enormous noise, influencing the marine bio-life. The transhipment line in addition is not considered as a safe pass, since it is beset with challenges, natural (during frequent squalls from the Indian Ocean, visibility can decrease considerably to make it difficult for mariners to navigate) and man-made (piracy).
  • The Phillips Channel in the Singapore Strait is just 2.7km wide making it another maritime zone of bottlenecks and potential oil spills. With so many vessels in the crowded Singapore Strait, there is often an increase of incidents.
  • From the Straits of Malacca and Singapore, ships make their way to the South China Sea, another zone of unstable waters in the South – East of the Indian ocean. The South China Sea is a prominent shipping passage with $5.3 trillion (nearly one-third of all global maritime trade) worth of trade cruising through its waters every year. Since this zone has emerged as one of the most dangerous flashpoints in the Indo – Pacific over the last decade, the transhipment here is rather unsafe, not mentioning the ecological disasters which are emerging currently there.
  • The Strait of Bab-El-Mandeb, one of the World’s Most Dangerous Straits (situated in the high conflict zone between Yemen and Somalia), is also the shortest trade route between the Mediterranean region, the Indian Ocean, and the rest of East Asia. Oil-rich Arabian Gulf nations rely heavily on it: approximately 57 giant oil vessels from these countries pass through the strait each day, over 21.000 each year. This fact makes the straight not only the zone of interests of main powers (and hence high tension in the region), but a big threat to the environment (oil spills).
  • The Strait of Hormuz is a strategically important strait or narrow strip of water that links the Persian Gulf with the Arabian Sea and the Gulf of Oman. As one of the busiest shipping lanes in the world, is also one of the most essential ones, due to the amount of oil tankers that navigate these waters daily. Around one third of the world’s oil is transported through this strait, making it essential not only for trade, but for the global economy. The same fact is making this route one of the most dangerous to the environment, considering existent oil spills or collisions.
  • The Suez Canal (Including Strait of Gubal) provides the shortest route between the Atlantic and Indian oceans (saves 7000 Km of extra travel). The 120-mile pass goes between Israel and Egypt and passes from the Red Sea to the Mediterranean Sea. 100 boats travel the canal daily and 3.9 million oil barrels travelled daily. Thus Around 8% of global sea-borne trade takes place through it. Despite the projects of Canal’s extension, it’ s waters are still congested, making the usage less safe, extending the time, and raising the costs of transhipments. 
  • Connecting the Atlantic Ocean and the Mediterranean Sea, the Strait of Gibraltar (including 20 nm either side of Europa Point) is one of the most used shipping routes in the world. The strait is only seven nautical miles (13 kilometres) across at its narrowest and 23.7 nautical miles (44 kilometres) at its widest. Approximately 300 ships cross it every day, about one ship every five minutes, which causes a high amplitude internal wave, upwelling of nutrient-rich water and affecting bio-life, not mentioning the noise pollution and heavy maritime traffic.
  • The Bosporus and Dardanelles Straits separate the Sea of Marmara from the Aegean and Black Seas. Both straights are on the Europe – Asia boundary and lie within Turkey. The Bosporus is located on the northern edge of the Maramara and southwestern edge of the Black Sea. Turkish Straits provide the only access between the Black Sea and the Aegean Sea. The Dardanelles, on the southern tip of the Marmara and north-eastern coast of the Aegean Sea (which is connected to the Mediterranean) is wider than its northern counterpart. More than 40,000 vessels are passing through these waters per year, transporting almost 650 million tons of cargo. Located in the conflict of the power’s interests, this zone has been always considered vulnerable in terms of safety, not mentioning significant damaging of local maritime bio life.

Thus, it can be traced that the current sea arteries of warm waters are not just seriously congested, but also dangerous not only for the ecology and because of security reasons (robbery, piracy etc), but also for the stable development of trade and economy. The consequences of these dangers may be fatal in few years, unless the measurements of improving the maritime transhipment infrastructure are not taken.

Thus, the cheapest in the cost, this transhipment line is not beneficial in terms of second criteria – timeframe (See Figure 1).

Another shipping line (cold water – blue line), which arose because of the rapid melting of the Arctic ice cap, opens prospects for the reduction of transport waterways in areas free of ice. Thus, it is another alternative to the main transcontinental routes that pass-through Eurasia, namely land rail (green line), air (white line) and warm southern waters of Eurasia and further to Africa through the Suez Canal (red shipping line). There are basically three possible routes, each of significance:

  • the Northwest Passage, connecting the American Continent and Far East Asia;
  • the Northern Sea Route, offering a shorter way from Europe to Asia along the Russian Arctic coastline; and
  • the Arctic Bridge, connecting Canada and Russia (See Figure 3).

Geographically the position of the North waterways is very beneficial. The Northwest Passage connects the Atlantic and Pacific along the northern coast of North America through the Arctic waters from the Davis straits and Baffin Bay all the way to the Bering Sea shortens the distance between Far East Asia and the American East coast (via Panama) by approximately 7,000 kilometres.

Figure 3. Northern shipping. Major transport routes through the Arctic

Source: Centre Port Canada, 2008.

The Northeast Passage, which connects the Atlantic coast of Western and Northern Europe with the Pacific coast of Northeast Asia via the Russian Arctic coastline, is cutting the distance between the edges of two continents, making it shorter by about 40% in comparison to the traditional, warm seas transport routes via the Suez or Panama Canal.

As it is highlighted in the analysis entitled “IFIMES for the Global Greening Economy (A Brief Impact Study)”, the Arctic Bridge is a seasonal route which shortens the connection between the North American and European continents via the Arctic Ocean. Observation shows that the transhipment route between the North Atlantic and the Pacific Ocean straight over the Central Arctic Ocean (the so-called Arctic Bridge) might be in reach earlier than expected due to climate change. In this case Iceland’s strategic position will change dramatically and could turn the island into an economic hub – a power base for transportation-related services, bringing along a whole new range of economic activities to the Europe.

Thus, in terms of logistics, the cold waters shipping line (blue – Northern sea or Arctic passage) will allow to deliver cargo to Europe by sea faster than the 48 days (that it takes on average) to travel from the Northern ports of the Far East to Rotterdam via the Suez canal, considering that the passage of a cargo ship from Shanghai to Hamburg along the North sea route is 2.8 thousand miles shorter than the route through Suez canal. (i.e., in 2019 the Russian Arctic gas tanker “Christophe de Margerie” reached South Korea from Norway without an icebreaker escort in only 15 days) (See Figure 1).

Another advantage, which play into the hands of the blue transhipment routes is the decrease of using of harmful to the environment material – cement. Building new land infrastructure (especially roads) requires cement, a material that contributes more than 6 per cent of global carbon emissions. Shifting the transportation mode to the sea, therefore, will reduce the amount of roads constructions on the land.

In addition to the time criterion, cold water shipping line is beneficial in terms of capability. It is usually characterized as the shortest sea route between Europe and Asia, the safest (i.e., the problem of Somali pirates) and has no restrictions on the size of the ship, unlike the route through the Suez Canal. Thus, the Arctic route will allow to deliver cargo to Europe faster by sea, reducing the route by 20 – 30%, and hence being more environment friendly (by using less fuel and decreasing CO2 emission) and saving human resources. Nevertheless, the capitalizing on that opportunity requires much work in terms of improved navigation procedure and installation of safety-related infrastructure.

Energy aspect

But the shortening of the transhipment routes and hence slight decreasing of CO2 emissions will not solve the problem completely. The global environmental issue of CO2 consumption should be treated starting from the main root of the problem and in regards with it, Arctic may play the key role.

The projects launched in the Arctic (i.e., project Yamal LNG) meets the goal of reducing the share of coal in total energy consumption in the world’s largest greenhouse gas emitters below 58% by the end of 2020, as this project allows to diversify countries’ energy sources, contributing to its withdrawal from coal use. This, in turn, reduces CO2 emissions within the country and may contribute to the implementation of the same scheme in the framework of the building of the transhipment routes.

The goal to reduce a dependence on coal and fossil fuels requires a huge surge in the use of natural gas, and the adoption of renewable energy. Which is resulting in not only infrastructure constrictions, but also the development of the projects connected with energy (See Figure 4). One of the key factors driving the implementation of this projects is that, unlike traditional fossil fuels, renewable energy sources are widely available around the world. Whether it is solar or wind power, tidal energy or hydroelectric plants, most countries have the potential to develop some clean energy.

Figure 4. Investments into the Renewable energy projects

Source: Boston University Global Development Policy Centre, 2019.

The region covered by new transhipment routes (esp. South – Eastern Europe, Eurasia and South – Eastern Asia covered by Eurasian transhipment lines) has significant potential to be powered by solar energy. Thus, it is estimated that less than 4 percent of the maximum solar potential of the region could meet the countries’ electricity demand for 2030 which gives the world a possible solution to reduce the countries’ need for fossil fuels as they develop.

Only in Europe, due to the implementation of renewable energy projects (i.e., Francisco Pizarro plant in Spain, Nikopol Solar Power Plant, Ukraine, Cestas Solar Farm in Bordeaux, France etc) the solar capacity increased by 36% to 8 GW in 2018. By 2020, several members stated in the European Union pushed to meet their 2020 renewable energy targets. 

Along with solar projects, wind onshore wind farms projects (i.e., southeast region of Ukraine, the Fantanele – Cogealac wind park, Romania etc) are also destined to meet increased national energy needs in the wake of phasing out fossil fuel power plants. Thus, the renewable energy potential and cooperation opportunities is a chance for the countries to leapfrog from their carbon-intensive trajectories to low-carbon futures.

Conclusions

Summing up, for now it can be seen that there are two possibilities for developing transport systems and economies in accordance with green standards:

  • Transcontinental railroad system (which requires huge amount of investments);
  • Optimization of the cheapest mode of transportation (maritime warm waters transhipment lines) (See Figure 3).

But while thinking on the best ways of the decarbonizing of transport connections between the most-producing countries of G-7 (Atlantic states and other European countries) with other advanced OECD economies, all the existing risks (such as “convenience”, roads “safety” (piracy, oil spills), water congestion levels and maritime traffic) should be considered. As it was mentioned above, warm waters transhipment lines (See Figure 1) currently present certain dangers, being high congested and unsafe (both for trade security and environment), and hence rather vulnerable. Due to this fact, it is crucial to consider other alternatives of connecting the biggest countries-producers (China) and countries-consumers (West Europe).

Statistical data on logistics proves, that the development of the cold waters (i.e., Arctic passage or blue line shipping line) route (See Figure 1) drastically reduce the time and distance between the largest G-7 producers and developed OECD markets. Nevertheless, though there is high potential to slash international shipping distances by opening shorter routes in the north, the high risks on these alternative routes are keeping most traffic running over the classic transport routes like the Suez and Panama Canals.

But when building and improving the continent’s logistics chains, it is also important to consider the standardization aspect along the One Belt One Road initiative.

Today countries of Eurasia, not including China, account for about 18% of global GDP and 26% of global carbon dioxide emissions. Current transhipment lines going through these countries are estimated to increase carbon dioxide emissions by at least 0.3% worldwide – but by 7% or more in some countries as production expands in sectors with higher emissions, unless the measures to decarbonize the initiatives are taking. The window for action is narrow: investment decisions made in the coming few years will determine the carbon intensity of critical infrastructure and major real-estate assets that will operate for decades. Thus, by linking policy, finance, and the international community’s expertise and technological resources, it is possible to lay the groundwork for low-carbon development in the countries’ economies. To ensure that development in the transhipment lines does not undermine the global climate agenda, meaningful steps must be taken to reduce substantially the carbon footprint of new investments in these economies. 

Analysing this issue, it is worth mentioning that the carbon dioxide emissions in developed countries have been in decline for over a decade and are at approximately the same level right now they were at 25 years ago, while the developing countries are experiencing an explosion in the growth of carbon dioxide emissions. This is explained by the fact, that developed countries achieved their development on the back of coal, which is now being phased out. On the other hand, developing countries are currently developing by using coal, and that is driving up their carbon emissions. It is also explaining the fact that developing countries are not willing to follow stated “greening” goals, since it will require higher financial costs and longer process of the project’s implementation.

To reach consensus in timing, price, and environmentally friendly standards the growing push to decarbonize economies, implement the green construction methods should be done. Unfortunately, this approach may take decades to be adopted, which our planet may not have. And the understanding of this fact should be the basis for the development of all countries without exception and the logistical development of the initiative “One Belt – One Road” in particular.

Dr. Maria Smotrytska is a senior research sinologist and International Politics specialist of the Ukrainian Association of Sinologists. She is currently the Research Fellow at International Institute for Middle East and Balkan Studies (IFIMES), Department for Strategic Studies on Asia. PhD in International politics, Central China Normal University (Wuhan, Hubei province, PR China) Contact information : officer[at]ifimes.org SmotrM_S[at]mail.ru

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Gender-based violence in Bangladesh: Economic Implications

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Violence against women is one of the most heinous crimes perpetrated in today’s   world. However, despite the gravity of the violence perpetrated against women, it is still the pervading reality in the world. Bangladesh is also afflicted with this malaise of violence against women which is manifested in the deluge of news across the media about the violence against women in various  form .While Bangladesh has made commendable strides in the economic front, the  perennial subjugation of the women who account  for virtually half of its population remains a hurdle. Against this backdrop, this article investigates the economic toll incurred to the economy owing to the entrenched culture of systemic violence in our country.

Women constitute nearly half of the population of Bangladesh. As such, their innate potentials have considerable bearing on the socio-economic progress of the country. Admittedly, advancement of a country in socio-cultural indicators presupposes the simultaneous improvement of  women from the subjugated position culturally attributed to them. It is impossible  to envisage a prosperous thriving economy without the contribution and participation of the women equally. Therefore, the lack of women’s participation commensurate with their capabilities   hinders the development of the country.

One of the obstacles women confront in their journey of transforming into human capital is perhaps the retrograde views that society harbor about the traditional gender role of the women which fetter their contribution to the economy and society by bestowing them only  the  circumscribed role of  looking after the domestic affairs and rearing and educating child. The pastoral as well as urban culture   perpetuate these traditional gender roles and deny women a free rein over their fate. Whenever  women   disavow the preordained and predictable roles  provided by the society, they  have  to face mounting pressure from society so as to conform to the prevailing norms .Failing to  conform to the  regressive gender role will spell grave consequences for the women .When the society fails to cower the woman with the threats that are at its disposal ,it resort to the egregious path of violence. While   violence against women is one of the most reprehensible crime one can ever commit, it however is normalized through a power dynamics that  reinforces the overbearing male role and relegate women to the subjugation. Therefore, the culture of violence against women isn’t anomalous rather is embedded in the prevailing  patriarchal power dynamics which deem chastising women for their  rebellious attitude is solicited and  invoke often contrived and distorted religious edicts in order to legitimize their deplorable crime. Moreover, the culture of violence against women which has been  aptly termed as a epidemic by the United Nations  is rooted in the prevailing socio-economic  structure of the country that  systematically condone the browbeating of women into submission to patriarchal  norms and wield violent measures when the woman stubbornly gainsay their patriarchal hegemony.

While the social, cultural and health toll of the violence perpetrated against women is undoubtedly strenuous, the economic losses incurred by the violence and the opportunities nipped in the bud owing to violence against women also need to be taken into account in order to the adequately discern the deleterious ramifications of the violence against women .However, despite profound economic toll that are inflicted due to the violence against women, it is still unaddressed in the economic literature worldwide and discussion and cognizance about this momentous issue and its economic implications still scant.

As has been mentioned earlier, women constitute the lynchpin of the economy of Bangladesh which has been adequately manifested in the participation of women in Bangladesh’s much-heralded RMG sector and other productive sectors. However, this success of the economy   overshadows the plight and perils  this working class women confront in their bid to become economically productive. The violence against women is systemically entrenched in the country and women’s engagement in the economic activities are frowned upon by the society and culture .Therefore ,the this patriarchal fetter women behind the door of their  houses  and worst women are inflicted  physical and mental violence in event of questioning the dictates of the elders and the male custodians. Therefore , the fundamental impact of violence against women on the economy of the country related to the untapped opportunities due to the constrains imposed by the patriarchal society on women under the pretext of social, religious and cultural norm. This threat alone or normalization of the gender role of the women as a care-giver hinder women in taking part in the economy on a par with their male counterparts  .

Beside the lost  opportunities that can be tapped, the violence against women has numerous other implications on the economy. Firstly, the violence against women inevitably  results in the physical damage and mental trauma of the victim which has enduring toll on her. Therefore ,violence against women translate to toll on the health of the victim and therefore the cost incurred on the victim due to medical fees  as a result of the violence is also included in the economic cost of violence against women. Secondly, the violence against women also leads to diminished productivity of the victim due to the health hazards. Therefore, violence against women has implicit economic cost on the economy as a result of the lost productivity.

Thirdly,the cycle of the violence against women negatively sensitize women in not challenging the sacrosanct patriarchal norms and therefore women fit themselves with the prevailing adverse society and they themselves reproduce and reinforce these norms .Therefore, a vicious cycle set in which prevents women to actualize their potential and stymie them in their path of realizing their goal .This result a sense of apathy in women with regards to education and other means of social mobility and they deliberately avoid the economically productive activities that are deemed taboo by the prevailing social norms and cultural ethos.

Moreover, violence against women is an egregious form of crime perpetrated by a   patriarchal agent while the society has entrenched roles, norms and ethos that condone and encourage such outrageous violence .Moreover, a vicious cycle is at play in the gender based violence. The economic repercussions of the violence committed against women is considerable. Violence against women hinder the development  of the women commensurate with their inherent potential which nip the dreams of women in the bud. Besides, gender based violence also deter women in challenging the prevailing patriarchal norms and undertaking productive economic activities that are frowned by the patriarchal society and are deemed taboo. Moreover, a widespread sensitization in societal level as well as a drastic  overhaul of the patriarchal structure is necessary in order to avert the adverse socio-economic consequences of gender-based violence and extirpate the heinous root of this deplorable crime.

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Omicron Variant: Implications on Global Economy

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The prolonged battering of the Covid-19 has been considerably hitting the world economy. While vaccination and a receding in the cases of the cases in virus transmission has provided   brief respite to   the countries that are grappling with the recurring surge of the virus, the resurfacing of another virulent   mutation termed as  Omicron sounds ominous for the future of the world economy .Against this backdrop, this article projects the plausible economic ramifications of the new strand of the virus on the global economy.

The economic downward trajectory occasioned by the Covid-19 has been unprecedented in recent global history. While the economic depression of 2007-08 proved disastrous for the world economy, the toll   emanating from Covid-19 pandemic and consequent   economic stagnation has surpassed all the previous   economic plunge .In fact, some analysts have gone to the extent of   comparing the Covid-19 induced economic depression with the great depression of the 1920s.However, whether the far reaching repercussions of the Covid-19 on the global economy will be as momentous is still remains to be seen. Nevertheless, the   profound   economic jolt triggered by the Covid-19 pandemic is poised to reverberate across the world through shaping socio-economic and political events

The scar inflicted by a protracted economic recession owing to Covid-19 is apparent in the arduous path of economic rejuvenation in the western countries and eastern countries alike. Virtually every country is grappling with the toll that Covid-19 has incurred in the economy. The western countries are finding it   difficult to retrieve the losses that Covid-19 has precipitated. Although the swift vaccination of the western countries at the expense of the developing countries has provided a fleeting lull in their battle against Covid-19,it seem however the virus has resurfaced with increasing virulence in order to offset whatever gain these embattled countries managed to garner in their fight against Covid-19.

The skyrocketing and unprecedented inflation of the western countries coupled with a plummeted consumer confidence has meant a prolonged period of stagnation of their economies. However, in the wake of vaccination induced temporary respite in the viral cases, the economies rebounded strongly from the pits of economic recession. However, these hard-earned   gains will be reversed in the event of the advent of any new strand of the virus. Already, the delta variant which originated in India had triggered a spate of Covid-19 flare-ups in the United   States and United Kingdom. Against this backdrop, the Omicron variant is set to aggravate the   economic woes of the western countries and in turn the world.

While the western countries are reeling from economic stagnation, the developing and underdeveloped countries are confronting many abysmal realities due to their prevailing economic backwardness. Their economic plight has been lingering in want of adequate vaccination due to the apathetic stance of the western countries and global governance institutions .Therefore, while the western countries has rebounded from the Covid-19 induces economic predicaments, the difficulties confronted by the developing countries has continued unabated. While the influence of advanced countries and their less advanced counterparts in world-economy is inextricably tied, the callous attitude of the developed countries to the vaccination of countries in Asia and South Asia turn out to   be sheer lack of economic prudence.

While western countries are considered as the economic hub of the world, it is however the developing countries on which the vital supply chains of the world economy hinges on. Therefore, the tardy pace of vaccination in these countries is prejudicial to the global economic stability. The economic ramification of the slow pace of vaccination is twofold for the world economy. Firstly, the slow vaccination hinders the revival of the economic activities in the developing countries thereby obstructing the supply chain of the commodities .This supply chain crisis has ripple effect in the western economies. The recent predicament of inflation and attending macroeconomic woes in countries like the United States and United Kingdom is manifestation of the supply chain crisis plaguing the world economy. Due to the paucity of commodities and raw materials, the prices of necessary goods has escalated in the western countries which has plummeted consumer confidence and triggered a vicious cycle of stagflation in the economy that is reminiscent of the 1970s when a similar crisis in oil supply has  precipitated economic downturn in the western economies.

Secondly, the slow rate of vaccination also run the risk of allowing the virus to mutating to newer and much virulent variants and due to the unfettered communication as a result of globalization the emergence of any new variant doesn’t remain in the confines of any border rather proliferate like wildfire and precipitate global crisis. Therefore, the lack of vaccination or slack pace therefore has global repercussions. Therefore, it is judicious of the developed countries to concentrate efforts in contributing to the vaccination of the less developed countries which will yield good results for their economy.

The ubiquitous mechanism in battling Covid-19 remains one of containment that entails halting economic and other activities and insulating the countries from other countries through imposing border controls, curbs on air communication and other stringent measures echoing protectionist attitude. However, these measures are antithetical to the spirit of the globalization and global trade. While lockdowns and other protectionist measures yield temporary improvement in the Covid  cases, it is not viable in the longer term. Besides, lockdowns have deleterious ramifications on the economy and further aggravate economic rebounding of the developed countries and developing countries alike. Therefore, efforts should be aimed at preventing the Covid cases rather than grappling with the Covid with a knee-jerk policy of improvisation. .

Moreover,Covid-19 has already occasioned far-reaching economic fallout in the world economy. Indications abound regarding the fact that the world economy is verging on profound and prolonged recession. Against the backdrop of ominous predictions and slackening growth and painful inflation of the world economy, the prospects of the world economy due the advent of a new variant remain mired in obscurity. It can be concluded that the economic repercussions of yet another novel variant will be momentous and will offset hard-earned growth of the countries .Unlike previous precedent of haphazard policy and knee-jerk policy solutions, this time around the countries need to undertake challenge much prudently and should concentrate all of their efforts aiming at universal vaccination of all countries so as to prevent the resurfacing of similar virulent viral strands.

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A Good Transport System Supercharges the Economic Engine

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The infrastructure bill in the U.S. has been signed into law.  At the American Society of Civil Engineers (ASCE), they are celebrating the fruition of a couple of decades, at least, of hard work publicizing the decaying infrastructure and lobbying for a fix-it bill.  Countless delegations have visited the White House and met with staff to present their case.  And something for their efforts is better than nothing. 

They also started a grading system, giving an overall grade — currently C minus, a notch above the previous one.  The bill seeks improvement in roads, bridges and transit although it falls short of the ASCE estimates for what is needed.  For example, the bill contains $39 billion for transit (ASCE grade of D minus) but there is a backlog of $176 billion that is needed.  Given Republican opposition to spending and the compromises made to pass the bill, the administration got what they could — they can always fight for more later. 

This opposition against infrastructure spending is somewhat incomprehensible because it generates jobs and grows the economy.  Too much spending, too fast has inflationary potential but that is caused by too much money chasing too few goods, usually not when there is a tangible product — improved transit, roads and bridges in this case.  And then there are also other ways of checking inflation. 

This bill is a start but still a long way from having high speed cross-country electric trains as in other major industrialized countries.  These are the least polluting and especially less than airplanes which emit six times more CO2 per passenger mile. 

Why is the U.S. so lagging in high-speed rail when compared with Europe and Japan?  Distances are one reason given although these are a function of time.  No one would have thought of commuting 30 miles each way to work in the 19th century but it is not uncommon now for some to be quite willing to sit 45 minutes each way on a train for the pleasure of living in the greenery of suburbia. 

The bill also includes $110 billion for roads and bridges.  Unfortunately the backlog of repair has left 42.7 percent of roads in sub-standard condition costing motorists an estimated $130 billion per year in extra vehicle repair and maintenance.  Some $435 billion is now needed to repair existing roads plus $125 billion for bridges, $120 billion for system expansion and $105 billion for system enhancements like increasing safety — a necessary improvement given a changing environment such as an increase in bicycle traffic.  Allowing for round-off discrepancies, the total amounts to $786 billion (in the funding and future need section of reference).  Increases in severe weather events have also had their effect, causing damage to roadways and further burdening the repair budget.  

New technologies (in the innovation section of reference) like advanced pavement monitoring on key roads, using moisture and temperature sensors embedded in the roadway, now make it possible to assess pavements quickly without impacting road users.  This leads to earlier repair and in addition new materials increase the life cycle.  Much of this requires increased investment up front to take advantage of the new innovations. 

Above all one can never afford to forget that a good transport system acts like a supercharger for the economic engine.

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