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The Russian economy: Will Russia ever catch up?

March 31, 2015 Comments off

The Russian economy: Will Russia ever catch up?
Source: European Parliament Think Tank

Over the past 25 years, Russia has undergone dramatic economic changes, with the difficult reforms and catastrophic economic collapse of the 1990s, the boom years of the new century, the global economic crisis and the current downturn. Despite all these developments, many of the structural economic challenges faced by Russia remain unchanged since Soviet times. Bountiful natural resources have helped to fuel growth, but at the cost of an unhealthy dependency, as the current situation so clearly illustrates. This problem is acknowledged by the Russian government, which under Dmitri Medvedev’s presidency in particular, declared its intentions to diversify and modernise the economy. However, the continued flow of gas and oil money has removed the incentive to undertake serious economic reforms, and these have faltered as a result. Many of Russia’s structural problems are inherited from Soviet and even Tsarist times. Large swathes of the economy remain under state control, and there are numerous barriers to both domestic and international competition. Businesses struggle with red tape and ubiquitous corruption. Despite Medvedev’s stated objective of developing an ‘intelligent economy’, and the country’s traditional strengths in research, development, innovation and education, Russia continues to underperform in these areas. Over the past few years, the Russian government has simplified bureaucratic procedures, launched a high-profile anti-corruption campaign, privatised state-owned companies, overhauled the education system and invested in innovation. However, such initiatives have brought measurable improvements in only a few areas. Aggravated by these structural issues, falling oil prices and economic sanctions have led to a rapid deterioration in the economic situation. The rouble has lost half its value, inflation has shot up, formerly sound public finances look increasingly shaky, and the economy is forecast to tip into recession in 2015. How quickly Russia recovers from its current difficulties will depend on whether or not oil prices pick up and sanctions are eased. Regardless of these, however, structural problems are likely to continue hampering the process of economic modernisation for the foreseeable future.

EU Council Library Think Tank Review — Issue 22

March 26, 2015 Comments off

EU Council Library Think Tank Review — Issue 22
Source: General Secretariat of the Council of the EU (Central Library)

Welcome to issue 22 of the Think Tank Review compiled by the EU Council Library. It gives a short abstract of papers published in February 2015, with a link to the full text.

This month’s Review has a focus on external action and includes the CEPS/ Friedrich-Ebert-Stiftung report on More Union in European defence, presented in Brussels on 9 March. Other relevant resources from the library were listed in our blog post on the event.

On economics, we harvested the habitual range of papers on the banking union, capital markets, pros and cons of the ECB’s quantitative easing, debt targets and the balanced budget rule, and more. Thomas Piketty’s book continues to trigger debate. See the collection of (mostly critical) essays on the book by the UK think tank Policy Network. On inequality, the notion at the heart of Piketty’s book, we also feature an article by Caritas Europa and one by Friends of Europe.

EU — How safe are your roads? Commission road safety statistics show small improvement for 2014

March 25, 2015 Comments off

How safe are your roads? Commission road safety statistics show small improvement for 2014
Source: European Commission

Following two years of solid decreases in the number of people killed on Europe’s roads, the first reports on road deaths in 2014 are disappointing. According to the figures released today, the number of road fatalities has decreased by approximately 1% compared to 2013. This follows on the 8% decrease in 2012 and 2013. The figures reveal a total of 25 700 road deaths in 2014 across all 28 Member States of the EU. Whilst this is 5700 fewer than in 2010, it falls short of the intended target decrease.

EU — The Cost of Non-Europe in Transport

March 24, 2015 Comments off

The Cost of Non-Europe in Transport
Source: European Parliament Think Tank

Transport is a vital component of the EU economy with huge untapped potential. The sector suffers however from remaining barriers, gaps and market inefficiencies that create substantial costs and that could be addressed through further action at EU level. The gains that could be achieved from addressing the identified issues in the four modes of transport – rail, road, air and maritime – are estimated to amount to at least 8.6 billion euros annually. While the four sectors show similarities in terms of market fragmentation and lack of competitiveness, each sector requires its own approach to reform. This document summarises the main elements that build up the Cost of Non-Europe in the transport sector. This is an updated version of a briefing published in January 2015.

NGOs and money laundering: Adapting EU rules to engage NGOs better

March 17, 2015 Comments off

NGOs and money laundering: Adapting EU rules to engage NGOs better
Source: European Parliamentary Research Service

Money laundering (ML) is a major global concern. The minimum identifiable direct costs of organised crime in the European Union (EU) are estimated at around €166 billion a year. Europol, the EU’s law enforcement agency and Eurojust, the EU’s Judicial Cooperation Unit, estimate the minimum costs of fighting organised crime at EU level amount to €210 million a year.

To efficiently tackle ML the EU has stepped up cooperation with civil society, including non-governmental organisations (NGOs). NGOs are engaged as collectors of relevant information on illicit activities, and in developing standards and implementing anti-ML rules. At the same time, however, NGOs are considered ‘subjects at risk’ in the ML framework, either as fronts for terrorist organisations that raise and transfer funds, or as legitimate enterprises that indirectly support the aims of terrorist organisations.

This double-sided position for NGOs may impact on the efficacy of the measures currently in place at EU and international level to certify their transparency and accountability. NGOs, in turn, see such attempts to regulate their activities as a threat to their independence, and thus occasionally resist them.

EU — Massive changes in the criminal landscape

March 16, 2015 Comments off

Massive changes in the criminal landscape
Source: Europol (European Law Enforcement Agency)

Key drivers for future change

  • Innovation in transportation and logistics will enable organised crime groups to increasingly commit crime anonymously over the Internet, anywhere and anytime, without being physically present.
  • Nanotechnology and robotics will open up new markets for organised crime and deliver new tools for sophisticated criminal schemes.
  • The increasing exploitation of Big Data and personal data will enable criminal groups to carry out complex and sophisticated identity frauds on previously unprecedented levels.
  • E-waste is emerging as a key illicit commodity for organised crime groups operating in Europe.
  • Economic disparity across Europe is making organised crime more socially acceptable as organised crime groups will increasingly infiltrate economically weakened communities, portraying themselves as providers of work and services.
  • Organised crime groups will increasingly attempt to infiltrate industries that depend on natural resources, to act as brokers or agents in the trade.
  • Virtual currencies increasingly enable individuals to act as freelance criminal entrepreneurs operating on a crime-as-a-service business model without the need for a sophisticated criminal infrastructure to receive and launder money.
  • Organised criminal groups will increasingly target, but also provide illicit services and goods to, a growing population of elderly people exploiting new markets and opportunities.

2015 EU Justice Scoreboard: supporting Member States to improve their justice systems’ effectiveness

March 13, 2015 Comments off

2015 EU Justice Scoreboard: supporting Member States to improve their justice systems’ effectiveness
Source: European Commission

Key findings from the 2015 EU Justice Scoreboard include:

  • Improvement in the efficiency of justice systems in Member States can be observed. However, the situation varies significantly depending on the respective Member State and indicator. Reaping the rewards of justice reforms takes time.
  • Efforts to enhance the use of information and communication technology (ICT) tools for the judicial systems have continued. However, the indicators reveal gaps in a number of Member States, both for ICT tools available for the administration and management of courts and for electronic communications between courts and parties.
  • More than 20% of judges participated in continuous training on EU law or on the law of other Member States in the majority of Member States. This considerably exceeds the 5% annual target of legal practitioners who need to be trained in order to reach, by 2020, the objective of 50%.
  • The majority of Member States enable free online access to civil and commercial judgments for the general public.
  • The higher the court, the lower the share of female judges. Even if the share of female professional judges for both first and second instance shows a positive trend, for the Supreme Courts most Member States still have some way to go to reach the gender balance of 40-60%.
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