CISD Yearbook of

Global Studies

Volume 3

May 2016

CISD Yearbook of Global Studies Volume 1 Number 2 May 2016

Unravelling the ‘Fourth Freedom’: The European Union’s immigration and asylum practice and its wider implications for human mobility within the region 2

Adam Ragy

IDPs, Power, Interests & Institutional Pathologies: An Analysis of the Politics of Why There is No International IDP Regime 27

Marta Corti

The Informal Economy: Understanding Variations Between Developed and Developing Economies 50

David Mee

The International Politics of Global Cities 101 Jose Ferrando Alemany

Can ‘war minus the shooting’ encourage development and peace? 125 Alison Freebairn

Politics of Cyberspace: Balancing Virtual Attacks and Real-World Responses 150 Lauren Eliot

Assessing the importance of electricity market design for meeting the EU’s long-term energy and climate targets: The paradox of how a transition towards renewables is undermining the transition towards renewables. 175

Martin Sedgwick

International Financial Investment and Risk: Concepts, Challenges and Costs of an Imperfect Approach to Political Risk. 203

Mehdi Bchir

Governing through precarity and debt in the European debt crisis: working at the intersection of late capitalist subjectivity and mechanisms of global governmentality 224

Marie Paglinghi

‘The future of international law is domestic’: based on their record since 1900, what factors lead to the establishment of successful domestic criminal trials for genocide? 247

Leah Owen

New media, old story: What the official Facebook pages of the US embassy in Islamabad and Pakistan embassy in Washington DC tell us about public diplomacy 279

Sana Qadar

‘The Diaspora Option’ – The Only Option?: Diaspora Diplomacy and State-Sponsored Transnationalism in Eritrea and Ethiopia 308

Tewodros Sile

Introduction by Dr Dan Plesch, Head of Department

It is one of the pleasures of the academic year to write the introduction to CISD’s Yearbook

of Global Studies. The Yearbook once again brings together the most outstanding

dissertations of the year, ranging across the spectrum of interests in the Centre.

Why isn’t there a global regime to help refugees within a country? How is the EU adapting

its legal regime handle free movement of peoples in the light of changing international

conditions and supposedly universal norms? These two topics illustrate the relevance of the

work done by our students.

The students also were undaunted by highly technical issues – cyber warfare, energy

production and climate change. These are all dissertations looking at topics which are at the

forefront of the contemporary politics.

Dissertations looking at less obvious dynamics examine the way global cities project

themselves in international politics; the variations in informal economies in the Developed

and Developing worlds, and mechanisms of elite management of European populations

during the debt crisis.

The prize winning piece of work though was an innovative study of the previously

unanalysed twenty national genocide trials that have taken place around the world, this alone

is reason enough to delve into this volume.

All in all these dissertations constitute a remarkable set of studies and a remarkably good

read.

Dan Plesch

June 2016

Unravelling the ‘Fourth Freedom’: The European Union’s immigration and asylum practice and its wider implications for

human mobility within the region

Adam Ragy

Abstract The securitisation of migration, namely the convergence between international migration and security concerns is a complex process that has wide ranging implications for human mobility. Throughout this dissertation I will explore the various manifestations and ramifications of the constructed ‘threats and risks’ associated with migration in the context of the European Union’s (EU) policy and practice towards irregular migrants, asylum seekers and refugees. The EU is in currently in the midst of a ‘migrant crisis’ characterised by large influxes of irregular migrants who traverse perilous and hostile waters in an effort to reach Continental Europe. My analysis will be predicated upon two prominent phenomena which are closely linked to this process, chiefly the criminalisation of irregular migrants and the politicisation of immigration and asylum issues throughout the EU. By discussing these manifestations of the EU’s securitised migration control, I aim to demonstrate how the consequent trends of exclusion, restriction and removal have wider implications for the ‘fourth freedom’, namely the free movement of persons (Favell, 2014: 2) within this regional bloc.

Introduction and Conceptual Framework Background of international migration dynamics

Since the beginning of the twenty first century there has been an increasing convergence between migration and security, embedded within the collective political consciousness of numerous states, regional blocs and global regimes. This convergence, otherwise known as the ‘securitisation of migration’, has manifested itself in various ways within national, regional and global contexts at an accelerated rate. The migration-security nexus, and its associated ramifications, will be the central analytical focus of this dissertation. This will be done with specific focus on the European Union (EU), which is currently in the throes of “the worst refugee crisis since the Second World War” (Dimitris Avramopoulos, 2015). In order to grapple with this complex and multifaceted topic it is important to provide some context of the current dynamics surrounding international migration.

“Accelerating migration is a quintessential feature of globalisation” (Amrith, 2014: 1149). Indeed, the current flows of international human mobility, whilst not historically unprecedented have been aided by Information Age advancements in telecommunications and transportation technologies. Innovations in aviation technology allow for swift international travel across borders; and instantaneous information exchanges made possible by the Internet have heightened transnational consciousness by increasing awareness of global disparities in income and living standards. In addition to these advancements, decolonisation facilitated widespread multidirectional, diverse and complex migration flows as it “gave birth to the world of states, which called forth a world of peoples that, for the first time, had the potential to circulate globally” (Duffield, 2008: 152). Furthermore, post-Cold War socio-political shifts, in particular the multidimensional, structural changes wrought by neoliberalism (Castells, 2010), have provided millions of people with the motivations and resources necessary to render migration a feasible reality. The aggregation of these dynamics has cultivated the current era of pervasive and multifaceted human mobility, whose momentum is continuously increasing. According to statistics published by the United Nations High Commissioner for Refugees (UNHCR), in 2014 it is estimated that there are 232 million international migrants globally which constitute a significant 3.2 percent of the world’s population. Included in this statistic are a sizable minority of ‘forcibly displaced’ (UNHCR, 2015) migrants, which are chiefly asylum seekers and refugees fleeing from protracted conflicts and humanitarian disasters. This group, which will be the principal focus of this dissertation, accounts for 59.5 million of total international migrants which put into context roughly equates to the current population of Italy (CIA World Factbook, 2015). The issue of how to manage and regulate the flows of these ‘forcibly displaced’ migrants is extremely salient for politicians, policy makers and numerous other actors worldwide but chiefly within liberal Western states. The ‘securitisation of migration’ is corroborated by many influential scholars such as Fiona Adamson and Michael Humphrey who have long pointed to the link between international migration and national security which was embedded within the mainstream public consciousness after the 11 September 2001 attacks (9/11) and the 7 July 2005 London bombings (Adamson, 2006; Humphrey, 2013). The securitisation of forcibly displaced migrants has been accompanied by widespread “restrictive immigration controls and exclusionary rhetoric” (Çetin, 2012: 1), directed towards different types of migrants but predominantly irregular migrants, asylum seekers and refugees. The principal focus of this dissertation will be on the securitisation, criminalisation and politicisation of asylum policy and practice within the EU and its effects on wider human mobility within the 28-member

state politico-economic union. I will identify causal links between these phenomena and the EU’s wider human mobility dynamics. Dimitris Avramopoulos, the EU Commissioner for Migration, Home Affairs and Citizenship, recently commented that “the unprecedented influx of migrants at our borders, and in particular refugees, is unfortunately the new norm and we will need to adjust our responses accordingly” (BBC, 2015). The majority of the refugees and asylum seekers that he refers to are people fleeing protracted conflicts and humanitarian disasters in the Middle East and North Africa (MENA) region, chiefly Syria and Iraq, and the Horn of Africa, predominantly Eritrea and Somalia (UNHCR, 2015). The EU’s regional policy and the governance measures geared towards mitigating and regulating these asylum flows and their associated ramifications will be closely scrutinised throughout this dissertation.

As mentioned above, I aim to address EU asylum policy and practice through the discussion of two prominent phenomena which operate under the umbrella of securitisation. The first section will elaborate upon the criminalisation of the irregular migrant or ‘crimmigration’ which charts the “growing convergence between criminal justice and migration control systems” (Global Detention Project, 2013: 4) and is fast becoming a ubiquitous practice within the EU. Secondly, I will focus on the convergence between migration and politics, widely known as the ‘politicisation of migration’. This phenomenon focuses on migration as an issue of multi-partisan political salience contextualised in “the wake of rising anti-immigrant populism” (Kunz et al., 2011: 2) within the EU. I will also demonstrate how this convergence manifests itself in the governance of asylum and immigration implemented by a consortium of relevant EU actors and institutions. Following on from this I will discuss the causal links, convergences and disparities between these phenomena before concluding my analysis. I will begin my analysis with a conceptual backdrop, charting the rise and proliferation of securitisation and the closely affiliated phenomenon of global governance. Following on from this I will outline the principal issue posed by this dissertation, namely how the securitisation of migration manifests in exclusionary and restrictive policies not only towards asylum seekers and refugees but also to a wider spectrum of migrants within the EU including labour migrants and third country nationals (TCNs).

Shifting security paradigms in a globalised world

Securitisation, in its simplest form can be understood “as a process by which issues are made into security issues” (Van Dijck, 2006: 3). In order to understand this process, it is important to analyse the changing conceptions of security through the perspective of international relations theory. Throughout the twentieth century, conceptions of security gradually shifted from the realist and neorealist definitions in terms of states and military capacities towards the more liberal and human centred ‘Copenhagen School’ approach which was “no longer centred on states, but on society” (Buzan, 1993; Ibrahim, 2005). This approach was accompanied by the proliferation of a new category of nebulous security risks termed as ‘potential vulnerabilities’ to the liberal world order. These vulnerabilities linked the security of the individual to a range of global threats and as a result of these conceptual changes, securitisation has developed into a highly prevalent discourse applicable to a broad range of “economic, societal, political and environmental issues” (Saleh, 2010: 229) including global pandemics, financial crises, climate change and international migration.

Using the constructivist school of thought allows us to elucidate the dynamics and nuances of securitisation owing to its focus on the diverse aspects of world politics, in particular, the social construction of knowledge and social reality (Bourbeau, 2011: 31). As such,

constructivism has shifted the “focus of the analysis of world politics away from merely material factors to include social and ideational factors as well” (Reus-Smit, 2005; Bourbeau, 2011). Constructivism allows for the interpretation of securitisation as a socially constructed discourse which is predicated upon “a shared understanding of what are to be considered security issues” (Sheehan, 2005: 62). Indeed, the construction of threats takes place predominantly via the discursive practices of a plurality of ‘securitising actors’ such as “international organisations, politicians, academics, and journalists” (Ibrahim, 2005: 165) some of which will be discussed below. There are numerous examples of this, one of the most poignant being the recent securitisation of the Ebola epidemic which evolved from a West African, to a global crisis, at an astonishing rate. This occurred largely through the discursive practices of international organisations (IOs) namely Médecins Sans Frontières (MSF) and the World Health Organisation (WHO) as well as prominent politicians such as Barack Obama who stated that “this is more than a health crisis, this is a growing threat to regional and global security” (Independent, 2014) despite only 36 out of 27,965 (0.13%) of cases and 16 out of 11,298 (0.14%) of deaths being reported outside of Guinea, Liberia and Sierra Leone (WHO, 2015). The effects of these discursive practices have been corroborated by many influential scholars such as Fiona Adamson, who link the transformative influence of globalisation which changes the “overall environment in which states operate” (Adamson, 2006: 167) to the increasing prevalence of securitisation. Globalisation, in turn, is “characterised by an accelerated internationalisation, an increasing political and economic liberalisation, and technological innovation and revolutions fuelling the trend toward transnational operations and linkages” (Woods, 2002). As such, the classification of issues as security threats occurs in the context of a highly interconnected world accompanied by a simultaneous decline in traditional state centric and military conceptions of security. Furthermore, these globalisation processes largely account for the transnational and pervasive nature of modern security threats. The applicability of securitisation to migration takes its form via constructed linkages between cross border human mobility and global security threats including terrorism, drug trafficking and organised crime (Bermejo, 2009: 215). Although the securitisation of migration has been prevalent in EU policy circles since the 1980s (Huysmans, 2000: 751) it became firmly embedded within the core of EU migration policy in the early 2000s as is evident in a 2004 release by the European Commission (EC) linking the “security of the EU and its Member States… to the terrorist attacks in the United States on 11 September 2001 and in Madrid on 11 March 2004” (EC, 2004). Scholars argue that such incidents served to reinforce the “already existing fears regarding the links between migration and terrorism in Europe” (Adamson, 2006), and that they provided institutional opportunities, impelled cooperation and increased integration of security measures as a response (Geddes, 2008: 177). The significance of this process lies in the linkages between securitisation and the measures conceived in order to manage and contain the associated ‘constructed threats’. This takes place in the context of ‘global governance’, as described below. Global governance and the management of ‘risks and threats’

Alongside the construction of global threats and the internationalisation of security concerns, comes the parallel inception of a range of “exceptional measures” (Bigo, 2002: 64) to manage and contain these threats. The management of these threats does not only occur at the national level but increasingly within the context of ‘global governance’, a phenomenon for which there is no unanimous definition but essentially encompasses “the collective capacity to identify and solve problems on a global scale” (Slaughter, 2003: 83). This ‘collective

capacity’ has been facilitated by the aforementioned increased integration of global processes under the auspices of globalisation and has been observed particularly within the global finance and trade regimes. It is important to note that there is no international migration governance regime owing to global tensions between “economic interests, security considerations and humanitarian commitments inherent in the complexity of international migration” (Kunz et al., 2011: 2). However, “relevant governance structures do exist” (Betts, 2011) and have manifested in “a multitude of international norms and cooperation arrangements which have proliferated over recent years” (Kunz et al, 2011: 2).

Global governance primarily entails “the expansion of pro-active preventive measures and practices beyond the state” (Humphrey, 2013: 181) which is predicated upon the cooperation of an interconnected range of public global governors such as “states, international organisations, and transgovernmental networks” and their private counterparts which include “multinational corporations, terrorist networks, and global social movements” (Bennett, 2013: 801). Transnational actors including IOs and non-governmental organisations (NGOs) play a crucial role in the global governance of constructed threats as, owing to their extraterritorial nature, they are uniquely situated to operate “on behalf of, yet beyond the traditional bounds of the sovereign state” (Ashutosh and Mountz, 2011: 22). Despite the inherently transnational character of global governance and its promotion of multi-stakeholder decision making, its existence within the stratified and hierarchical order of the international system perpetuates the democratic deficits highlighted by north-south inequalities. This imbalance, in turn, “reflects the underlying power structures of the neoliberal status-quo” (Lederer 2005: 9) and promulgates “representational shortcomings” (Bennett, 2013: 802) whereby the voices of certain actors are diminished or marginalised entirely. Such marginalised actors are normally located within the “domestic and international peripheries” engendered by the dominant neoliberal order which include “urban ghettos, rural hinterlands and rebellious states” (Tehranian, 2002: 6). The relevance of these structural and hierarchical imbalances, with regards to international migration, will be elaborated upon later in this dissertation. Having established securitisation and global governance as the principal analytical tenets of this dissertation I will now proceed with their application to the phenomenon of international migration with a specific focus on irregular migration flows into the EU. The Issue Securitisation within the EU’s ‘freedom of movement’ framework The principal issue of this dissertation is my suggestion that securitised migration control measures are transcendent in nature, going beyond their intended targets and having wider restrictive impacts on human mobility within the EU. This is accompanied by the “blurring of different forms of migration and the development of control oriented, restrictive migration policy” (Niemann and Schmidthäussler, 2012: 2). The foundational ideal of the EU is predicated upon the “the four freedoms” (EC, 2015), namely the free movement of goods, services, capital and people within the EU as enshrined under the 1957 Treaty establishing the European Economic Community (TEEC), henceforth the Treaty of Rome. This ideal has been implemented via numerous agreements and directives, most notably the Schengen Agreement which entails the removal of internal border checks and simultaneous reinforcement of external border controls in an effort to counterbalance the perceived security void created by the former. My argument is that the ideal of free movement is being eroded by the securitisation of migration within this regional bloc. Indeed, this viewpoint was recently

validated by comments made by Theresa May, the UK Home Secretary, who raised concerns pertaining to the 2015 ‘migrant crisis’ and opined that it had been exacerbated by “the European system of no borders”, with specific reference to the Schengen Area (BBC, 2015). This viewpoint is shared by a number of senior politicians throughout the EU who have not ruled out future restrictions on the internal freedom of movement within the region (BBC, 2015). This conundrum lies within a wider “paradox of liberalisation”, embodied by “economic transnationalisation and free movement, on the one hand, and national closure towards increasing migration, on the other” (Munck et al., 2015: 4). The reasoning behind securitised migration controls within the EU can be explained using Duffield’s concept of ‘global civil war’. This proverbial war is predicated upon the ideational binary between ‘developed and undeveloped worlds’ and the resultant divide between their populations, termed as insured and non-insured life respectively (Duffield, 2008). This binary first arose in the post-decolonisation period when human mobility became more multidirectional and pronounced on a global scale. During this period a migration-security nexus came to fruition, whereby liberal welfare states attempted to reduce migration flows from these ‘undeveloped nations’ for fear that such flows presented a “danger to the social fabric and critical infrastructure of the welfare state” (Duffield, 2008). Affiliated with this binary is the idea of “citizenship as a privilege” (Furia, 2006) which is particularly applicable to the EU due to the associated rights and preferential treatment enjoyed by citizens of EU member states. “By contrast, third country nationals (TCNs) – individuals who do not hold citizenship of one of the member states… remain largely excluded from the benefits of EU citizenship” (Maas, 2008: 583). Numerous scholars have argued that this ‘members club’ mentality has fostered the notion of “second-class citizenship” (Kochenov 2006, Maas 2008) within the EU’s migration policy framework, whereby exclusionary measures are implemented, restricting the movement of TCNs and barring them from the array of privileges enjoyed by their more fortunate counterparts. In light of these binaries, migration control measures, aimed at maintaining the physical and spatial boundaries between insured and non-insured life, have become one of the key features of global governance today. The perceived security threats derived from irregular migration galvanise a range of responses most notably the development of “security and surveillance regimes” (Amoore et al, 2008) focused on managing migration through the employment of complex border control measures. A good example of this is the ‘Smart Borders’ initiative proposed by the European Commission (EC) in 2013 which entails the increase in border security measures implemented by member states through a consolidated and interconnected “digital infrastructure” consisting of biometric controls, computerised surveillance and networked databases. This digitalisation is particularly noticeable via measures such as the “Schengen Information System (II), the Eurodac database and the Visa Information System” (Broeders and Engbersen, 2007; Aas, 2011). Scholars argue that these measures are an indication of the EU’s “simultaneous dynamics of inclusion and exclusion” (Scott, 2006: 18) whereby internal freedom of movement is maintained at the expense of the concurrent exclusion of “the poor, the dangerous, the unknown, and the vagabond” (Amoore et al, 2008: 97). As mentioned previously, border control measures have been gradually decoupled from the physical borders of nation states and are increasingly governed within a cooperative network of nation states and transnational organisations under the auspices of global governance. Within the EU, the management and implementation of such measures falls largely within the realm of regional agencies and international organisations such as Frontex and the International Organisation for Migration (IOM) respectively. Furthermore, these organisations

are the main entities concerned with the horizontal diffusion of EU migration governance measures from the ‘centre’ to the ‘periphery’. In this context, the ‘centre’ implies a globally dominant core of capitalist economies whilst the ‘periphery’ is a set of “industrially, financially and politically weaker states operating within a set of relationships largely constructed by the centre” (Buzan, 1993: 432). These entities operate on the front lines of migration governance and arguably serve to perpetuate the ‘crisis mentality’ prevalent at the heart of the securitisation of migration by shaping the “discursive environment within which particular states pose the problem of how to govern specific issues” (Andrijasevic and Walters, 2010: 984). Through various practices, the IOM and UNHCR promulgate norms and standards of their own creation and transfer the border control policies detailed above beyond the borders of the relevant nation state. This phenomenon is known as the “extra-territorialisation of control” (Rijpma and Cremona, 2007) and is evident in the case of EU enlargement, whereby the accession of potential member states was largely dependent upon their willingness to adopt and implement the EU’s norms and standards of migration governance. Furthermore, this necessarily entails that EU “policies on immigration, borders and asylum are progressively subject to various externalisation processes” involving non EU member states, also known as ‘third countries’ (Carrera, 2011: 248). Such processes entail the implementation of mobility partnerships with these ‘third countries’, with the aim of consolidating the EU’s migration management and regulating population flows into and within the region. One of the principal measures implemented by transnational entities such as the IOM is the governance of state induced returns (Koch, 2014: 905) involving the removal of failed economic migrants and asylum seekers and their return to their respective countries of origin. In light of this, measures such as assisted voluntary return (AVR) programs are implemented by the IOM, “geared towards removing rejected asylum seekers and stranded and irregular migrants and returning them to their countries of departure” (Andrijasevic and Walters, 2010: 993). The decision to return is often made under “duress or as an alternative to state-enforced expulsions” (Andrijasevic and Walters, 2010: 994) whereby asylum seekers are persuaded to retract their asylum claims in exchange for an airline ticket and small financial grant. Having generally described the array of securitised migration practices within the EU, I will now focus my analysis on the tangible manifestations of these practices for irregular migrants and wider human mobility within the EU. I will begin with a discussion of the most sinister manifestation of the securitisation of migration, that of the convergence between irregular migration and criminality, otherwise known as the phenomenon of ‘crimmigration’. Crimmigration The convergence between immigration and criminality

As highlighted in the introduction, there has been a noticeable convergence between irregular migration and criminality within the EU which has occurred under the umbrella of securitisation. Juliet Stumpf coined the term ‘crimmigration’ (Stumpf, 2012; Global Detention Project, 2013; Hernández, 2014) to describe the interdisciplinary amalgamation of “criminal justice and migration control systems” (Global Detention Project, 2013). Accompanying this phenomenon is the binary between “bona fide global citizens and crimmigrant others” (Aas, 2011: 331) which is a tangible manifestation of the aforementioned hierarchical inequalities engendered by the securitised governance of migration. My analysis will not be predicated upon the legal aspects of crimmigration, rather the normative policy and practice aspects

which are apparent at the national and regional levels within the EU. I will start at the national level using the case study of Malta which is particularly apt in illustrating the convergence between immigration and criminality, and its associated ramifications, due to its unique position within the wider dynamics of EU asylum and immigration policy. I will demonstrate below how Malta’s policy of arbitrary immigrant detention has criminalised migrants and cultivated a wider set of exclusionary and restrictive practices towards asylum seekers, irregular immigrants and TCNs in the EU. Malta: An embodiment of the EU’s asylum and immigration policy

The small island-state of Malta is an exceptional case (Mainwaring 2012) that warrants analysis due to its unique geostrategic standing within the wider dynamics of the EU’s policy towards irregular migrants, asylum seekers and refugees. Malta is the smallest member country of the EU, geographically situated in the Mediterranean Sea, 80 km south of Italy, 284 km east of Tunisia and 333 km north of Libya (CIA World Factbook, 2015). As such, it lies roughly midway between the African and European continents making it one of the first available points of entry into the EU, with the exception of the Italian Pelagie Islands, notably Lampedusa. Consequently, Malta is the first country of asylum for many irregular migrants traveling from Libya to the European continent. Despite its size and peripheral location, I will demonstrate that Malta represents an embodiment of the EU’s increasingly hostile and exclusionary attitude towards irregular migrants and asylum seekers. This is because “Malta is the only EU country that practices a policy of systematic detention of all irregular immigrants setting foot on its soil, regardless of whether they are asylum seekers or not” (Lutterbeck, 2009: 133). This contentious practice is justified by Maltese authorities due to their self-portrayal as a ‘small frontier island’, and the factors described below. Malta is a recipient of migration flows from three coastal migration hubs, all which are located in Libya. According to a 2005 ministerial policy document on “Irregular Migrants, Refugees and Integration”, Malta has been the self-proclaimed “stepping stone to mainland Europe” and the “southern-most point of entry into the Union” (Policy Paper, 2005) since it attained membership to the EU during the 2004 ‘big bang accession’. With these factors in mind, the Maltese government has been vociferous in portraying its disproportionate susceptibility to the adverse effects of asylum flows due to a number of ‘physical restrictions’ characterised by its small size of 316 km2, high population density of 1200 person/km2 and built up area of 23 percent (Policy Paper, 2005). Malta’s importance in the realm of EU asylum policy is substantiated by the fact that the country was chosen to host the European Asylum Support Office which is the principal agency concerned with “supporting Member States of the European Union in their efforts to bring closer national practices in the field of asylum” (Comte, 2010: 374). Malta’s predicament is well substantiated by statistical evidence as it is the country with the highest proportion of asylum applications to its population in the EU. Indeed, “the arrival of one illegal immigrant in Malta is pro rata equivalent to the arrival of 114 immigrants in Italy and to 150 immigrants in the United Kingdom” (Policy Paper, 2005) and furthermore the ratio of refugees to 1,000 inhabitants in 2011 was 16.7 percent, the highest among the EU countries (Global Detention Project, 2014). I will now demonstrate the pervasiveness of Malta’s arbitrary detention of all irregular immigrants, before illustrating the wider implications of this practice for human mobility within the EU.

The blue-bordered penitentiary

Malta has wielded significant political clout on the direction and implementation EU asylum policy since its accession. As part of the accession process, Malta was required to implement the Schengen acquis and Dublin II Regulation, which saw its borders redefined as “external borders in need of fortification to compensate for the reduction in internal border controls initiated under the Single European Act of 1992” (Mainwaring, 2012: 14). This period saw the fortification of EU borders and increased pressure placed upon ‘peripheral’ nations, such as Malta, to cooperate with managing and regulating asylum flows into the EU. Malta has been described as “Europe’s migrant prison” due to its operation of a “detention regime” (Al Jazeera, 2014) owing to its policy of prolonged mandatory detention upon arrival of all irregular migrants, irrespective of country of origin or vulnerability. The Global Detention Project reports that, as of 2013, Malta has established an impressive infrastructure consisting of an “array of reception centres, psychiatric facilities and two main detention centres… that can hold up to 2000 detainees” (Lemaire, 2014: 146). These facilities are incorporated within the Maltese governmental structure as they are managed by a dedicated representative in the Ministry for Justice and Home Affairs. The Maltese authorities justify this arbitrary detention as a necessary measure to safeguard their security and to deter irregular migration flows onto their territory, indicating this practice’s link with securitisation. Furthermore, Mainwaring argues that Malta has employed this practice in an effort to “politically construct a crisis scenario” (Mainwaring, 2012: 2) of regional proportions due its peripheral position on the external border of the EU. The Maltese government justifies immigrant detention as a deterrent (Mainwaring, 2012) and it has been reported that the Maltese Navy regularly try to communicate the message to would-be immigrants on encroaching vessels there is “no future” (Lutterbeck, 2009: 136) for them on the island. This is owing to the long term mandatory detention combined with very few labour and social integration opportunities. More importantly, Malta views detention as the optimum method of managing large flows of asylum seekers and irregular immigrants not only onto their territory but also into the EU via their territory. Despite the contentious nature of this practice, it enjoys widespread multi-partisan political support within Malta (Lutterbeck, 2009; Mainwaring, 2012), with even the most pro immigrant party viewing it as a necessary evil. Their principal justification is that Malta’s national interest and domestic security take precedence over other human rights based concerns raised by NGOs, advocacy groups and human rights organisations. The case of Malta is a good example of the ways in which the arbitrary detention of immigrants normalises and justifies an array of exclusionary practices within the EU. The ‘Northern penal state’ and global citizenship hierarchies

Malta is a prototypical example of what Aas and Bosworth describe as the ‘Northern penal state’ in which immigrant detention is “a large-scale instrument being applied as an automatic control mechanism to govern irregular migration” (Parkin, 2013: 17) whilst concurrently propagating the view of irregular migrants as a security threat. They describe this type of state as blurring the lines between administrative and punitive detention, essentially perpetuating “an elaborate legal regime that criminalises certain forms of movement” (Aas and Bosworth, 2013: 27) whilst branding large swathes of the world’s population ‘illegal’ in the process. This connotation of illegality and the linking between mobility and criminality has aided in the perpetuation of global hierarchies of citizenship which categorises migrants’ legality in accordance to their nationality or country of origin and fosters a “pervasive and insidious

connection between migration, crime, and insecurity” (Aas and Bosworth, 2013: 29). In addition to this, the discursive and political coupling of migration and crime has created a “specific dynamic of social exclusion” which has produced “an illegalised global underclass, whose control is a driving force behind the formation of many of the transnational surveillance networks” (Aas, 2011: 337). ‘Crimmigration’ is arguably the most sinister manifestation of the securitisation of migration as it entails a presupposition of illegality, meaning that “illegality is not an action but a facet of a migrants’ very being” (Parkin, 2013: 18). The resultant effect is that migrants originating from ‘blacklisted’ states are branded as deviant immigrants or “crimmigrants” and are subsequently criminalised and subjected to arbitrary detention and randomised checks amongst other restrictive and prohibitive measures. The pre-emptive aspect of this arbitrary detention is further explained by Sergio Carrera who confirms that the practice “ignores the fact that the targeted individual may not be in fact an ‘illegal’ but a potential asylum seeker or refugee” and instead introduces the hypothetical category of the “would-be irregular immigrant” or “would-be asylum seeker” (Carrera, 2007: 25). A number of human rights NGOs and intergovernmental organisations have attempted to address this connotation of ‘illegality’ by raising awareness of its associated ramifications. For example, the Platform for International Cooperation on Undocumented Migrants (PICUM) recently published an awareness raising leaflet in which it decried the use of ‘illegal’ when describing migrants as “inaccurate, harmful and against Europe’s values” (PICUM, 2014). The leaflet suggested several alternatives by pushing for a shift in terminology to ‘undocumented’ or ‘irregular’. It also highlighted the fact that a number of global and European entities including the UN General Assembly (UNGA) and the EC respectively have since recognised the negative connotations associated with this term and adopted the softer jargon above in their official communications. The impact of semantics and terminology will be discussed further in the next chapter. I will now discuss the wider tangible ramifications of the crimmigration phenomenon via the consequent rise of detention industries and transnational criminal networks, namely human traffickers and smugglers. Ramifications: the rise of human trafficking and detention industries

In addition to the perpetuation of global hierarchies, the criminalisation of the migrant and the resultant increase in arbitrary detention has had far reaching repercussions for the mobility of asylum seekers, refugees and irregular migrants. Rodolfo Casillas argues that rather than acting as a deterrent, the “exponential increase in the detention of undocumented immigrants” has led to the “diversification of immigration routes, multiplication of networks of human traffickers, a rise in the costs of relocation, and an increase in the level of vulnerability of the immigrants” (Casillas, 2011: 299). These factors have spawned a profitable criminal counter industry of human traffickers and smugglers whose networks are diverse, adaptable and extremely profitable with statistics indicating that in 2010 the cost per trafficked victim was an average of US$13,000, totalling US$32 billion globally (Wheaton et al., 2010: 124). Furthermore, human trafficking networks are involved in direct competition with nation states and regional blocs over the “control of migration related processes” (Adamson, 2006: 178), offering viable, yet highly exploitative alternative mobility methods for desperate and vulnerable migrants and introducing another dynamic into the already saturated realm of EU migration governance. The recent activities of human traffickers and smugglers has been widely covered by global media outlets with numerous accounts of tragic incidents involving death and human suffering being reported regularly. One of the most tragic incidents was the discovery of 71

decomposing bodies in a truck abandoned on the outskirts of Vienna on the 27 August 2015 (New York Times, 2015; BBC, 2015; Guardian, 2015). Austrian authorities reported that the bodies were all thought to be Syrian asylum seekers who were being transported to Austria via Hungary by a human trafficking ring operating out of the latter. The Austrian government responded to this incident by increasing security measures and initiating randomised ‘spot-checks’ on road and rail transportation in an effort to disrupt these flows (BBC, 2015; Smale and Eddy, 2015). The IOM’s Director General William Lacy Swing, on the other hand, opined that these knee-jerk measures have the inadvertent effect of pushing desperate migrants “right into the hands of smugglers” (Keaten, 2015) arguing instead for the collective provision of safe and legal means of travel on behalf of the EU. This fundamental disagreement between these two central actors on how to manage this situation presents a governance conundrum for which there is no optimal solution. In addition to this, the criminalisation of migration is a process “driven by multiple actors... who are motivated by diverse yet overlapping interests and agendas” (Parkin, 2013: 18). A notable example is that “the criminalised migrant as national security threat plays into global justifications for development of the detention industry” whereby detention facilities have become the “primary industries of small towns and surrounding regions” (Mountz et al., 2012: 5) within some EU member states. Indeed, the Global Detention Project issued a working paper in 2009 charting the increased privatisation of immigrant detention made possible through an “alliance of public and private interests represented within the ‘prison-for-profit movement’” (Bacon, 2005: 140). Scholars have argued that “the establishment of deeply rooted private incarceration regimes can engender an institutional momentum whereby the detention of immigrants and asylum seekers is encouraged” in light of the “interest of private companies to protect and expand their businesses” (Flynn and Cannon, 2009: 17). The privatisation of immigrant detention thus perpetuates an insidious self-sustaining cycle whereby the profit-driven increase in the prison estates within EU member states continually serves to increase the number of immigrants incarcerated within them. Closing statements Having elucidated the dynamics and consequences of ‘crimmigration’, its links with the securitisation of migration are readily apparent. The primary similarity is that both discourses propagate Duffield’s polarised binary of insured and non-insured life whereby global inequalities are perpetuated by the restrictive and exclusionary policies and practices of liberal welfare states. The arbitrary, punitive and indiscriminate nature of immigrant detention as demonstrated in Malta serves to create a social underclass of ‘illegal people’ for whom integration into the social and economic spheres of their destination countries is increasingly untenable. In addition to this, I have clarified the causal relationship between crimmigration, the privatisation of the detention industry and the rise of human trafficking and smuggling networks. These serve to increase the prevalence of immigrant detention and augment the suffering of irregular migrants, refugees and asylum seekers in addition to exacerbating the national security concerns of relevant nation states. I will now chart the development of the ‘politicisation of migration’ within the EU, another phenomenon which is closely linked with securitisation. The Politicisation of Migration In this section I will discuss the politicisation of migration which, similar to crimmigration, is a phenomenon that can be closely linked with the securitisation processes detailed previously.

The politicisation of migration entails the increased convergence of politics and migration and is a ubiquitous discourse within the EU and its member states. It should be noted that the politicisation of issues need not exclusively be a negative phenomenon (Bourbeau, 2011: 130). However, due to my focus on the darker aspects of human mobility my analysis will be predicated on examining the ways in which “immigrants have increasingly become subjects of harsh political discourses” and are scapegoated by governments wanting to demonstrate “robustness and control” (Bourbeau, 2001: 130) over immigration and asylum issues. As such, I shall analyse this phenomenon through the lens of more negative portrayals of asylum seekers, refugees and irregular migrants in the EU media, political and public spheres. Furthermore, I will identify causal links between politicisation and securitisation through the wider dynamics of EU asylum and immigration policy and practice. The crucial difference between securitisation and politicisation lies in that the latter involves taking an issue out of restricted networks and/or bureaucracies and bringing it into the public arena (Bourbeau, 2011: 130). As a result of this, the politicisation of issues often leads to stronger public awareness around them in addition to a “more mobilised citizenry and the polarisation of public opinion” (Schimmelfennig et al. 2015: 15). My argument in this dissertation is that these phenomena are closely linked, whereby the securitisation of migration in the EU is predicated upon the “extreme politicisation of migration and its presentation as a security threat” (Léonard, 2011: 2). In the oncoming paragraphs I will discuss the various ways in which issues of asylum and immigration have been politicised within the EU. Typically, the most effective and widely used method of politicising an issue is by bringing it into the public arena through the mass media. As such, I will start by discussing the implications of “mass media’s homogenised depictions” (Mountz et al., 2012: 4) of asylum seeker, refugee and irregular migrant flows within EU below. ‘Biblical’: Media depictions of the 2015 ‘European migrant crisis’

The daily coverage of the current ‘European migrant crisis’ by popular media outlets points to a strong and ubiquitous anti-immigrant rhetoric within the EU. Indeed, the ‘crisis’ mentality surrounding issues of migration is propagated by “fear mongers in the news industry” (Furedi, 2009: 213) through their frequent employment of ‘disaster terminology’ when reporting on issues pertaining to these migration flows. The content produced by these media outlets is awash with alarmist language; including zoomorphic, biblical and aquatic metaphors supplemented by sweeping generalisations, conflations in terms and crisis driven narratives. Dehumanising depictions of irregular migrant flows as “swarms” (David Cameron, 2015) and “marauding” (Philip Hammond, 2015) are not uncommon as are phrases including “newcomers flowing through open borders”, “tide of these desperate people” and “let us keep the floodgates closed” (Jenkins, 2015; Kirkup, 2015; Daily Express, 2015). A number of scholars and activists have postulated that such hyperbolic and dehumanising rhetoric serves to engender a “paranoid fear of invasion” (Rekacewicz, 2013) which perpetuates stereotypes and reinforces public fears of international migration as a volatile political, social and economic issue. Moreover, this language reinforces and reproduces the securitisation of migration via its portrayal of migrants as a “threat to security; a criminal element; a drain on resources” (Taylor, 2015) which often includes strong undertones of racial and cultural bias as I will demonstrate in the next section.

More recent debates around the term ‘migrant’ have suggested that it has evolved “into a tool that dehumanises and distances, a blunt pejorative” (Malone, 2015) which associates the former with a nuisance and a burden and creates an apathetic and desensitised public, largely indifferent towards their predicament (Morse, 2015). The UNHCR, has highlighted the

increased interchangeability between the use of the terms ‘refugee’ and ‘migrant’ in media depictions of the current ‘migrant crisis’. They argue that the “blurring the two terms detracts from the specific legal protections refugees require” (UNHCR, 2015) although they acknowledge that the terms may be interchangeable due to the pervasiveness of diverse and complex ‘mixed migration flows’ into the EU consisting of “complex population movements including refugees, asylum-seekers, economic migrants and other migrants” (IOM, 2011: 63). The particular effects of the use of language in the media on public attitudes towards immigration will be discussed below using empirical examples. National media depictions of immigration in Britain In light of the above, a number of linguistic studies have been conducted, analysing the use of language in articles covering migration related issues. A report by the Migration Observatory at the University of Oxford in 2013 on the portrayal of migrants in 58,000 British newspaper articles indicates the pervasiveness of a number of ‘consistent collocates’ linking immigrants with large numbers, security and economic issues. Their principal findings from the research period of 2010-2012 demonstrated increases in the use of the term “illegal immigrant” as well as increased overlapping of “vocabularies surrounding the words immigrants, migrants, refugees and asylum seekers” (Migration Observatory, 2013: 24). A more comprehensive analysis of British newspapers from 1996-2005 suggested that the continued conflation of words and phrases used to describe migrants by conservative media in the UK has been “responsible for creating and maintaining a moral panic” (Gabrielatos and Baker, 2008: 43) around migration related issues, specifically the increased influx of refugees and asylum seekers. In line with this viewpoint, a number of scholars have credited hyperbolic media depictions with instigating a ‘culture of fear’ as I will demonstrate below. The ‘culture of fear’ and public xenophobia in EU member states There has been a wealth of scholarly research around the political employment of discourses of risk (Mythen and Walkate, 2008: 221) in the context of Furedi’s ‘free floating’ narrative of fear (Furedi, 2007: 5), particularly with regards to immigration and asylum issues. Academic research on the ‘culture of fear’ engendered by liberal western media and political discourses is important in this regard as it elucidates the methods of fear proliferation via a constant fixation with potential threats to human security. Raymond Taras argues that “often the fear of foreigners is less self-induced than incited by those in authority so as to serve their interests” (Taras, 2009: 394), cultivated through sustained promotion by prominent authority figures such as “politicians, journalists and security professionals” (Mythen and Walkate, 2008: 227). Consequently, these fears are experienced by the general public vicariously through these portrayals rather than directly through personal experience (Furedi, 2007: 3). Such portrayals, in turn, serve to engender a “fear of foreigners, antipathy towards immigrants, and the effort to enforce boundaries of national belonging” (Taras, 2009: 391). This fear manifests itself in numerous ways, for example a recent survey was conducted among 400 students in a Maltese university which indicated that over one third of those surveyed felt uncomfortable sharing the university campus with irregular migrants (Martin, 2014). Naturally, these public fears manifest in domestic political action as I will demonstrate below. Asylum and immigration in EU member state politics The issue of asylum and immigration has long been mired in political expediency and as such has steadily developed into a central issue of concern for the electorate, particularly within the domestic politics of liberal European states. This occurs within the context of Didier Bigo’s

‘governmentality of unease’ whereby the electorate’s fears of a particular issue are harnessed and exceptional measures are implemented in order to manage and contain said fears (Bigo, 2002: 72). Consequently, “trust is created through governments excluding and exacerbating the marginalisation of certain categories of individual” (Parkin, 2013: 18), namely vulnerable migrants, asylum seekers and refugees. This is evidenced by the recent electoral debates taking place around these issues throughout the EU. The issue has long been of central bipartisan salience in the UK as evidenced in the run up to the 1992 general election where “race card politics” and “xenophobic alarmism” were prevalent (Roemer et al., 2007: 161). During this period, the Conservative leadership accused Labour of being too ‘soft’ on the issue of increasing asylum applications to Britain with the former vowing to be tougher on immigration and crime (Roemer et al., 2007: 161) than their opposition.

Specific rhetoric linking ‘bogus’ asylum seekers with benefit fraud has also been prevalent in British political circles accompanied by more stringent regulations, such as the 1996 Asylum and Immigration Act, which was drafted to counteract this. This debate can be neatly linked to Duffield’s aforementioned theory of ‘global civil war’ whereby the encroachment of ‘non-insured’ populations from peripheral nations is perceived as a threat to the liberal Western welfare state. The events of 9/11 also led “the Home Office to replace its emphasis on tolerant multiculturalism with a focus on ‘core British values’” (Roemer et al., 2007: 163) a shift which is characterised by the abundant linkages made between immigration and security under the securitisation of migration. The issue of asylum and immigration is also highly politicised in other European states such as France and Italy. In France, the electorate’s anti-immigrant sentiment has arguably been one of the causal factors behind the rise in popularity of Marine Le Pen’s, anti-immigrant, Eurosceptic and protectionist National Front party (FN). Much like their conservative counterparts in the UK, the FN have made efforts to reduce immigrant’s social welfare entitlements for similar reasons as those mentioned previously. In Italy, since the mid-1990s, the stance towards asylum and immigration has been “dominated by politicised and securitised approaches to a great extent” with an array of political opponents vying to present themselves as the “party with the highest competency on immigration matters” (Çetin, 2012: 19). The convergence of politics and issues of immigration and asylum has also taken place at the regional level, most notably in EU migration governance initiatives implemented by the agency Frontex as I will demonstrate below. Frontex: Securitisation through the politicised management of migration The principal entity concerned with the regulation of EU migration controls is the European Agency for the Management of Operational Cooperation at the External Borders of the Member States of the European Union, henceforth Frontex. The agency was set up in 2004, during the ‘big bang’ enlargement, with operations officially beginning in 2005. This agency’s principal function is the reinforcement and streamlining of cooperation between national border authorities within the EU (Frontex, 2015). It is important to note that Frontex’s functional autonomy is limited owing to its establishment by EU member states. As such, the agency’s activities are highly politicised and to a significant extent both controlled by EU Member States and dependent upon them for their execution (Léonard 2009: 371). As a result, many consider Frontex to be a prominent ‘securitising actor’ for the following reasons.

Prima facie, Frontex is not directly concerned with the management of migration, rather it was founded with the purpose of addressing more traditional security concerns, namely

counter-terrorism and drug trafficking. Despite this, “the actual practice of Frontex... is deeply connected with migration control” (Kasparek, 2010: 120) as the bulk of their border management activities entail the agency’s direct involvement in the regulation of migration flows into the region. A number of scholars consider Frontex to be an “overly-politicised body” whose strategy of EU migration management has resulted in the “standardisation and militarisation of border politics” (Léonard, 2011: 3) due to its management through “emergency-driven situations as politically constructed in the national arena” (Carrera, 2007: 27). One example of this is Frontex’s engagement in the joint naval operations Triton and Poseidon in cooperation with military entities including the Guardia Civil in Spain and the Guardia di Finanza in Italy (Lutterbeck, 2006). The involvement of the military in the realm of migration management, specifically via these joint naval operations, perpetuates the securitisation of migration due to the former’s “traditional involvement in addressing security issues” (Léonard, 2011: 18). The second principal issue lies in Frontex’s involvement with the interception of migrants at sea, whereby the latter are unanimously treated as illegal immigrants without any provisions made for the potential asylum seekers among them (Léonard, 2011). This pre-emptive interception arguably leads to EU states not fully respecting their international obligations as stipulated under the 1951 Convention relating to the Status of Refugees, henceforth the 1951 Refugee Convention, as it prevents potential asylum seekers from being able to lodge their claims for asylum as stipulated under the Dublin Regulation. Further activities conducted by Frontex that perpetuate the securitisation of migration include the harmonisation of border guard training across the EU including the formation of Rapid Border Intervention Teams (Neal, 2009) and the promotion of sophisticated surveillance and control technologies. Closing statements In this chapter I have elucidated the interconnectedness between the politicisation and securitisation of migration within the EU by demonstrating the ways in which issues of immigration and asylum converge with domestic and regional politics within the region. It is clear from my analysis that the ‘governmentality of unease’ (Bigo, 2002) is a ubiquitous practice within this context, whereby the public’s fears of immigration are harnessed and projected via the discursive acts of political elites and media outlets, amongst others. The empirical examples that I provided indicate the prevalence of this phenomenon throughout the domestic politics of EU member states and likewise at the regional level, via its perpetuation by a range of ‘securitising actors’, chiefly Frontex. I will now discuss the contemporary ramifications of these processes for wider human mobility within the EU before concluding my analysis. Discussion, Analysis and Conclusion A ‘crisis of solidarity’: Ramifications for human mobility in the EU Having closely analysed the criminalisation and politicisation of migrants and migration within the EU, I argue that rather than simply facing a migrant or refugee crisis, the EU is on the cusp of a ‘crisis of movement’ and which may entail the retrogression to a protectionist ‘Fortress Europe’ mentality as evidenced by current press coverage and political dialogue around this issue. As such, this may necessitate a reformulation of the region’s fundamental founding principles, namely the ‘four freedoms’, the free movement of goods, services, capital and people. Senior politicians within the EU have exhibited cautious responses to the current crisis and have not ruled out the modification or indeed suspension of the ‘fourth

freedom’, specifically the aforementioned suspension of the Schengen Agreement. Despite this, it should be noted that such considerations are not unprecedented, with France having previously threatened to abandon the treaty in 2011 (Waterfield, 2011). Having grappled extensively with prominent discourses surrounding the EU’s freedom of movement framework, I would argue that the dynamics of securitisation and the highly consolidated migration-security nexus are necessarily restrictive, exclusionary and discriminatory by nature. As such, the practices engendered under the umbrella of securitisation in the EU, namely the criminalisation and politicisation of migration, in conjunction with the mixed nature of current migration flows, have perpetuated and sustained national, regional and global inequalities and manifested in the aforementioned global underclass “of outsiders without access to the rights or privileges” (Stumpf, 2006: 412) bestowed upon citizens of EU member states and highly skilled labour migrants. In light of the foregoing, the combination of such restrictions and inequalities is further exacerbated by the lack of a consolidated regional or indeed global regime of migration governance. Unlike the finance and trade sectors, the governance of migration is shared by “a range of overlapping, nested and parallel institutions that are not hierarchically ordered” (Betts, 2014: 365). This in turn serves to complicate the implementation of immigration and asylum policies on the ground which in practice are characterised by “competing and contradictory interests” (Boswell and Geddes, 2011: 225). Furthermore, this is indicative of the greater need for clarity of both “normative obligations and the organisational division of responsibility” (Betts, 2014: 353) on behalf of the numerous entities concerned with the EU’s migration management. Given these factors, and the unlikelihood of the dissociation between migration and security in the near future, it is highly probable that the current dynamics of exclusion and restriction within the EU will continue to increase. Despite this absence of a migration governance regime, the management of the current EU ‘migrant crisis’ has risen to the forefront of the EU member states’ collective priorities with a recent EC communication renewing calls for a “set of core measures and a consistent and clear common policy” aimed at building “up a coherent and comprehensive approach to reap the benefits and address the challenges deriving from migration” (EC, 2015). Some of the recommendations within this communication include tripling the budget of Frontex and rapid implementation of the ‘Smart Borders’ strategy to facilitate travel for those deemed ‘bona fide’ third country travellers whilst concurrently stemming irregular migration via increased data-basing and surveillance. My theoretical and empirical analysis throughout this dissertation has demonstrated that strengthening these initiatives would likely serve to further perpetuate the securitisation of migration, and continue to propagate the exclusionary and restrictive practices towards these irregular immigrants, refugees and asylum seekers. As my analysis has demonstrated, Frontex remains a prominent ‘securitising actor’ in the EU as it propagates a range of practices closely linking migration and security. In addition to this, the EC’s continued calls for the implementation of a common asylum policy, predicated upon ‘burden sharing’, do not adequately consider the contentiousness of asylum and immigration issues within the domestic political circles and national security interests of many EU member states. Indeed, the attitude towards all irregular migrants regardless of vulnerability demonstrated in the case of Malta is indicative of a wider political trepidation towards these migration flows within the EU. Likewise, the cleavages engendered by asylum and immigration issues within the domestic politics of countries such as the UK, France and Italy would suggest that the EC’s ambitions for increased transnational cooperation within the EU are exceedingly optimistic.

Furthermore, new emerging trends resulting from the criminalisation, politicisation and concurrent securitisation of migrants within the EU suggest that the increased militarisation of borders and coastlines will continue to proliferate. Again Malta is a good example as recently in 2011 it outsourced aspects of its coastline management to a parastatal maritime security company ‘Blue Border Holdings’ which is committed to “providing comprehensive risk management services, including risk awareness; mitigation; response and training services” (Blue Border Holdings, 2015). As I have previously demonstrated, the externalisation of migration control through such measures serves to institutionalise the securitisation of migration, thereby consolidating the security-oriented norms and practices used to exclude and marginalise migrants. Renewed trends of exclusion and removal? The perpetuation of global inequalities under the securitisation of migration arguably entails restrictions on the mobility of a broader range of migrants, particularly in the context of the perceived threats to intra-EU mobility engendered by the current ‘migrant crisis’. One group of migrants which may be adversely affected by the current dynamics are TCN labour migrants, pending possible restrictions on the free movement of labour. This is because the facilitation of cyclical labour supply and demand flows “greases the wheels of the EU economy” (Recchi, 2008: 213), fosters innovation and is thus one of the central tenets of the ‘freedom of movement’ mantra within the regional bloc. Although this category is beyond the scope of this dissertation, they nonetheless warrant mention due to their centrality within the contradictory ‘paradox of liberalisation’ prevalent in the EU. As mentioned previously the paradox lies in that “freedom of movement is coupled with more restrictions on mobility” (Mainwaring, 2012: 5) depending upon the type of migrant in question. Indeed, my previous discussion about the criminalisation of irregular immigrants via the detention regimes of ‘Northern penal states’ adequately illustrates this. This practice in particular serves to sustain international hierarchies whereby nationality alone has become a causal factor for exclusion. This ‘global underclass’ could be further perpetuated by the intended implementation of a supplement to the EC’s 2009 ‘Blue Card Directive’ aimed at further facilitating entry, residence and intra-EU mobility for the most highly qualified non-EU workers whilst simultaneously excluding those from a lower skill set. Furthermore, the possible suspension of the Schengen Agreement owing to the security concerns produced by the current influx of unprecedented numbers of mixed irregular migrants into the EU would be highly restrictive to wider human mobility in the region. A number of scholars have also pointed to the fact that the ‘crimmigration’ phenomenon has produced a normative judicial and policy narrative predicated upon exclusion, removal and criminality as opposed to the inclusion and protection of vulnerable and desperate migrants (Mainwaring, 2012; Mitsilegas, 2012). Valsamis Mitsilegas argues that this shift may entail significant adverse consequences “for access to the EU by those who wish to claim international protection” (Mitsilegas, 2012: 111) which is of particular relevance in the context of current flows of refugees and asylum seekers into the EU. Crucially, such a shift would entail the violation of the EU member states’ responsibilities towards the protection of vulnerable migrants under international law as defined in numerous treaties and conventions, chiefly the 1951 Refugee Convention. In addition to this, the EU’s current judicial dynamics towards human trafficking and smuggling are more focused on the protection of individual nation states from “transnational criminality” as opposed to the rights and protections of the vulnerable migrants being exploited by these criminal networks. Again this is another obvious by-product of the securitisation of migration. Likewise, the prevalence of removal initiatives such as AVR is indicative of a wider ‘deportation turn’, “indicating a prodigious rise over the

last decade in the use of deportation” (Andrijasevic and Walters, 2010: 994) as a method of dealing with unwanted asylum seekers and irregular migrants. Conclusion This paper has touched upon the contemporary implications of the securitisation of migration on wider human mobility in the EU. I have demonstrated the pernicious convergence between migration and criminality under the crimmigration phenomenon which has served to reinforce global citizenship hierarchies and create an illegalised ‘global underclass’, whose movement is restricted and rights inhibited by virtue of their nationality. This practice has aided the growth of human trafficking and smuggling networks as well as immigrant detention industries throughout the EU. I have also highlighted the convergence between politics and migration, the politicisation of migration, whereby domestic and regional fears of immigration are cultivated and exploited by political elites and harnessed for domestic political expediency. At the regional level this convergence allows for the politicised management of migration via ‘securitising actors’ such as Frontex, whose exclusionary border control practices are indicative of the EU’s collective attitude towards asylum seekers and refugees. The current ‘migrant crisis’ questions the efficacy and practicality of EU’s culture of mobility and calls into question the bloc’s envisioned status as a “truly supra-national economic, social and political space” (Recchi, 2008:198). My analysis would suggest that the paradoxical and opposing dynamics of freedom and restriction, exclusion and removal are not conducive to the longevity of the region’s ‘freedom of movement’ mantra.

Bibliography Books and journal articles Aas. K., 2011. ‘Crimmigrant’ bodies and bona fide travelers: Surveillance, citizenship and

global governance. Theoretical Criminology, 15(3), pp.331-346. Aas, K., Bosworth, M., 2013. The Borders of Punishment: Migration, Citizenship, and Social

Exclusion. OUP Oxford. Adamson, F., 2006. Crossing Borders: International Migration and National Security.

International Security, 31(1), pp.165-199. Amoore, L., Marmura, S., Salter, M., 2008. Smart Borders and Mobilities: Spaces, Zones,

Enclosures. Surveillance & Society, 5(2), pp.96-101. Amrith, S., 2014. Currents of Global Migration. Development and Change, 45(5), pp.1134-

1154. Andrijasevic, R., Walters, W., 2010. The International Organization for Migration and the

international government of borders. Environment and Planning D: Society and Space, 28(6), pp.977-999.

Ashutosh, I., Mountz, A., 2011. Migration management for the benefit of whom? Interrogating the work of the International Organization for Migration. Citizenship Studies, 15(1), pp.21-38.

Bennett, E., 2012. Global Social Movements in Global Governance. Globalizations, 9(6), pp.799-813.

Bermejo, R., 2009. Migration and Security in the EU: Back to Fortress Europe? Journal of Contemporary European Research, 5(2), pp.207-224.

Betts, A., 2011. Global Migration Governance. OUP Oxford. Betts, A., 2014. The Global Governance of Crisis Migration. In: Martin, S., Weerasinghe, S.,

Taylor, A., eds. Humanitarian crises and migration; causes, consequences and responses. Routledge: New York, pp.349-368.

Bigo, D., 2002. Security and Immigration: Toward a Critique of the Governmentality of Unease. Alternatives, 27(1), pp. 63-92.

Boswell, C., Geddes, A., 2010. Migration and Mobility in the European Union. Palgrave Macmillan.

Bourbeau, P., 2011. The Securitization of Migration: A Study of Movement and Order. London: Routledge

Broeders, D., Engbersen, G., 2007. The fight against illegal migration - Identification policies and immigrants' counter strategies. American Behavioural Scientist, 50(12), pp.1592-1609.

Buzan, B., 1991. New Patterns of Global Security in the Twenty-First Century. International Affairs, 67(3), pp.431-451.

Carrera, S., 2011. The impacts of the treaty of Lisbon over EU policies on migration, asylum and borders: The struggles over the ownership of the Stockholm programme. In: Guild,

E., Minderhoud, P., eds. The First Decade of EU Migration and Asylum Law. Brill-Nijhoff, pp.229-255.

Casillas, R., 2011. The Dark Side of Globalized Migration: The Rise and Peak of Criminal Networks-The Case of Central Americans in Mexico. Globalizations, 8(3), pp.295-310.

Castells, M., 2010. The Rise of the Network Society. 2nd ed. Wiley: Blackwell.

Comte, F., 2010. A New Agency Is Born in the European Union: The European Asylum Support Office. Journal of Migration and Law, 12(4), pp.373-405.

Duffield, M., 2008, Global Civil War: The Non-Insured, International Containment and Post-Interventionary Society. Journal of Refugee Studies, 21(2), pp.145-165.

Favell, A., 2014. The fourth freedom: Theories of migration and mobilities in ‘neo-liberal’ Europe. European Journal of Social Theory, 17(3), pp.275-289.

Furedi, F., 2009. Culture of Fear Revisited. New York: Continuum. Furia, P., 2005. Global citizenship, anyone? cosmopolitanism, privilege and public opinion.

Global Society, 19(4), pp.331-359. Gabrielatos, C., Baker, P., 2008. Fleeing, Sneaking, Flooding: A Corpus Analysis of

Discursive Constructions of Refugees and Asylum Seekers in the UK Press, 1996-2005. Journal of English Linguistics, 36(1), pp.5-38.

Geddes, A., 2008. Immigration and European Integration: Beyond Fortress Europe. 2nd ed, Manchester: Manchester University Press.

Hernández, C., 2014. Creating Crimmigration. Brigham Young University Law Review, 2013(6), pp.1457-1516.

Humphrey, M., 2013. Migration, Security and Insecurity. lntercultural Studies, 34(2), pp.178-195.

Huysmans, J., 2000. The European Union and the Securitization of Migration. Journal of Common Market Studies, 2000, 38(5), pp.751-777.

Ibrahim, M., 2005. The Securitization of Migration: A Racial Discourse. International Migration, (43)5, pp.163-187.

Kasparek, B., 2010. Borders and Populations in Flux: Frontex’s Place in the European Union’s Migration Management. In: Geiger, M., Pécoud, A. eds. The Politics of International Migration Management. Palgrave Macmillan, pp.119-141.

Kochenov, D., 2006. European Integration and the Gift of Second Class Citizenship: The Absence of the Tools within the European Legal System to Combat Temporary Discrimination of European Citizens on the Basis of Nationality Institutionalized by the Acts of Accession. Murdoch University Electronic Journal of Law, 13(1), pp.209-224.

Koch, A., 2014. The Politics and Discourse of Migrant Return: The Role of UNHCR and IOM in the Governance of Return. Journal of Ethnic and Migration Studies, 40(6), pp.905-923.

Kunz, R., Lavenex, S., Panizzon, M., eds., 2011. Multilayered Migration Governance: The Promise of Partnership. London: Routledge.

Lederer, M., Müller P., eds., 2005. Criticising Global Governance. Palgrave Macmillan. Léonard, S., 2010. EU border security and migration into the European Union: FRONTEX

and securitisation through practices. European Security, 19(2), pp.231-254.

Lutterbeck, D. 2006. Policing migration in the Mediterranean. Mediterranean Politics, 11(1), pp.59-82.

Lutterbeck, D., 2009. Small Frontier Island: Malta and the Challenge of Irregular Immigration. Mediterranean Quarterly, 20(1), pp.119-144.

Maas, W., 2008. Migrants, states, and EU citizenship’s unfulfilled promise. Citizenship Studies, 12(6), pp.583-596.

Mainwaring, C., 2012. Constructing a Crisis: the Role of Immigration Detention in Malta. Population, Space and Place, 18(6), pp.687-700.

Mitsilegas, V., 2012. The changing landscape of the criminalisation of migration in Europe: the protective function of European Union law. In: Guia, M., van der Woude, M., van der Leun, J., eds. Social Control and Justice: Crimmigration in the Age of Fear. Eleven International Publishing, pp.87-113.

Mountz, A., Coddington, K., Catania, T., Loyd, J., 2013. Conceptualizing detention: Mobility, containment, bordering, and exclusion. Progress in Human Geography, 37(4), pp.522-541.

Munck, R., Schierup, C., Wise, R., 2015. Migration, Work and Citizenship in the New World Order Paperback. In: eds. Munck, R., Schierup, C., Wise, R., Migration, Work and Citizenship in the Global Order. Routledge, pp.1-13.

Mythen, G., Walklate, S. 2008. Terrorism, Risk and International Security: The Perils of Asking ‘What If?’. Security Dialogue, 39(2), pp.221-242.

Neal, A., 2009. Securitization and Risk at the EU Border: The Origins of FRONTEX. Journal of Common Market Studies, 47(2), pp.333-356.

Recchi, E., 2008. Cross-state mobility in the EU. European Societies, 10(2), pp.197-224.

Reus-Smit, C., 2005. Constructivism. In: Burchill, S., Linklater, A., Devetak, R., Donnelly, J., Paterson, M., Reus-Smit, C., and True, J. 3rd ed. Theories of International Relations. Hampshire: Palgrave Macmillan, pp. 188-212.

Rijken, C., 2011. The External dimension of EU policy on Trafficking in Human Beings. In: Cremona, M., Monar, J., Poli, S., eds. Cahiers du Collège d'Europe / College of Europe Studies: The External Dimension of the European Union's Area Freedom, Security and Justice P.I.E. Peter Lang. pp.209-239.

Roemer, J., Lee, W., Straeten, K., 2007. Racism, Xenophobia and Distribution: Multi-Issue Politics in Advanced Democracies. Massachusetts: Harvard University Press.

Saleh, A., 2010. Broadening the Concept of Security: Identity and Societal Security. Geopolitics Quarterly, 6(4), pp.228-241.

Schimmelfennig, F., Leuffen, D., Rittberger, R., 2015. The European Union as a System of Differentiated Integration: Interdependence, Politicization and Differentiation. Journal of European Public Policy, 22(6), pp.764-782.

Scott, J., 2006. EU Enlargement, Region Building and Shifting Borders of Inclusion and Exclusion. Ashgate Publishing Ltd.

Sheehan, M., 2005. International Security: An Analytical survey. London: Lynne Rienner Publishers.

Slaughter, A.M., 2003. Everyday Global Governance, Daedalus, 132(1), pp.83-90.

Stumpf, J., 2006. The Crimmigration Crisis: Immigrants, Crime, and Sovereign Power. American University Law Review, 56(2), pp.368-418.

Taras, R., 2009. Transnational Xenophobia in Europe? Literary Representations of Contemporary Fears. The European Legacy: Toward New Paradigms, 2009, 14(4), pp.391-407.

Tehranian, M., 2002. Global Terrorism: Searching for Appropriate Responses. Pacifica Review: Peace, Security & Global Change, 14(1), pp.57-65.

Wheaton, E., Schauer, E., Galli, T., 2010. Economics of Human Trafficking. International Migration, 48(4), pp.114-141.

Web sources

BBC, 2015. David Cameron criticised over migrant 'swarm' language. [online], available at: <www.bbc.co.uk/news/uk-politics-33716501> [accessed 03 September 2015].

BBC, 2015. Libya migrants: Hundreds feared drowned in Mediterranean. [online], available at: <http://www.bbc.co.uk/news/world-africa-32311358> [accessed 03 September 2015].

BBC, 2015. Migrant crisis: Austria holds suspected people smugglers. [online], available at: <http://www.bbc.co.uk/news/world-europe-34106343> [accessed 03 September 2015].

BBC, 2015. Migrant crisis: Merkel warns of EU 'failure'. [online], available at: <http://www.bbc.co.uk/news/world-europe-34108224> [accessed 03 September 2015].

Blue Border Holdings, 2015. Company. [online], available at: <http://maritimelandsecurity.com/company-2/> [accessed 3 September 2015].

Central Intelligence Agency, 2015. The World Factbook: Italy. [online], available at: <https://www.cia.gov/library/publications/the-world-factbook/geos/it.html> [accessed 3 September 2015].

Central Intelligence Agency, 2015. The World Factbook: Malta. [online], available at: <https://www.cia.gov/library/publications/the-world-factbook/geos/mt.html> [accessed 3 September 2015].

Daily Express, 2015. This time let us keep the floodgates closed, say NO to the EU. [online], available at: <http://www.express.co.uk/news/uk/440207/This-time-let-us-keep-the-floodgates-closed-say-NO-to-the-EU> [accessed 03 September 2015].

European Commission, 2004. Presidency Conclusions. Brussels [online], available at: <http://www.consilium.europa.eu/uedocs/cms_data/docs/pressdata/en/ec/82534.pdf> [accessed 03 September 2015].

European Commission, 2015. Communication from the Commission to the European parliament, the Council, the European Economic and Social Committee and the Committee of the Regions - A European Agenda on Migration, [online], available at: <http://ec.europa.eu/dgs/home-affairs/what-we-do/policies/european-agenda-migration/background-information/docs/communication_on_the_european_agenda_on_migration_en.pdf> [accessed 03 September 2015].

European Commission, 2015. The European Single Market, [online], available at: <http://ec.europa.eu/internal_market/top_layer/index_en.htm> [accessed 03 September 2015].

Furedi, F., 2007. The Only Thing We Have To Fear is the Culture of Fear Itself, Spike Online, [online], available at: <http://www.spiked-online.com/index.php?/site/article/3053> [accessed 03 September 2015].

Global Detention Project, 2013. "Crimmigration" in the European Union through the Lens of Immigration Detention. [online], available at: <http://www.refworld.org/docid/545b416d4.html> [accessed 10 September 2015]

Global Detention Project, 2014. Malta Detention Profile. [online], available at: <http://www.globaldetentionproject.org/countries/europe/malta/introduction.html> [accessed 03 September 2015].

Independent, 2014. Ebola virus: The transcript of Barack Obama's speech to the UN. [online], available at: < http://www.independent.co.uk/news/world/americas/ebola-virus-the-transcript-of-barack-obamas-speech-to-the-un-9756272.html> [accessed 03 September 2015].

IOM, 2011. Glossary on Migration. [online], available at: <http://www.corteidh.or.cr/sitios/Observaciones/11/Anexo5.pdf> [accessed 03 September 2015].

Jenkins, S., 2015. Refugees: this is the human tide the west doesn’t want. The Guardian. (19 June), [online], available at:

<http://www.theguardian.com/commentisfree/2015/jun/19/refugees-human-tide-west> [accessed 03 September 2015].

Keaten, J. 2015. AP Interview: Aid agency chief: Hungary's move to block migrants drives them to smugglers, Associated Press, (31 August), [online], available at:

<http://www.usnews.com/news/world/articles/2015/08/31/ap-interview-migration-group-ready-to-help-with-influx> [accessed 03 September 2015].

Kirkup, J., 2014. Who will stop the tide of these desperate people? The Telegraph. (28 October), [online], available at: <http://www.telegraph.co.uk/news/uknews/immigration/11041382/Who-will-stop-the-tide-of-these-desperate-people.html> [accessed 03 September 2015].

Malone, B., 2015. Why Al Jazeera will not say Mediterranean 'migrants', Al Jazeera, (20 August), [online], available at: <http://www.aljazeera.com/blogs/editors-blog/2015/08/al-jazeera-mediterranean-migrants-150820082226309.html> [accessed 03 September 2015].

MJHA and Ministry for the Family and Social Solidarity (MFSS), 2005. Irregular immigrants, refugees and Integration: Policy document. Valetta: MJHA/MFSS, [online], available at: <http://www.refworld.org/docid/51b197484.html> [accessed 3 September 2015].

Martin, I., 2014. Migrants - third of students don’t want them on campus, Times of Malta, (22 March), [online], available at: <http://www.timesofmalta.com/articles/view/20140322/local/Migrants-third-of-students-don-t-want-them-on-campus.511606> [accessed 03 September 2015].

Migration Observatory, 2013. Migration in the News: Portrayals of Immigrants, Migrants, Asylum Seekers and Refugees in National British Newspapers, 2010-2012. [online], available at: <http://www.migrationobservatory.ox.ac.uk/sites/files/migobs/Report%20-%20migration%20in%20the%20news.pdf> [accessed 03 September 2015].

Morris, C., 2015. Migrant crisis: Why do politicians seem unable to act? BBC News, (28 August), [online], available at: <http://www.bbc.co.uk/news/blogs-eu-34091417> [accessed 03 September 2015].

Morse, F., 2015. Cecil the lion: Things people say are more deserving of your outrage, BBC Newsbeat, (30 July), [online], available at: <http://www.bbc.co.uk/newsbeat/article/33717998/cecil-the-lion-things-people-say-are-more-deserving-of-your-outrage> [accessed 03 September 2015].

Perraudin, F., 2015. Marauding migrants threaten standard of living, says foreign secretary. The Guardian, (10 August), [online], available at: <http://www.theguardian.com/uk-news/2015/aug/09/african-migrants-threaten-eu-standard-living-philip-hammond> [accessed 03 September 2015].

PICUM, 2014. Why ‘Undocumented’ or ‘Irregular’. [online], available at: <http://picum.org/picum.org/uploads/file_/TerminologyLeaflet_reprint_FINAL.pdf> [accessed 03 September 2015].

Rekacewicz, P., 2013. Mapping Europe’s war on immigration, Le Monde diplomatique, [online], available at: <http://mondediplo.com/blogs/mapping-europe-s-war-on-immigration> [accessed 03 September 2015].

Smale, A., Eddy, M., 2015. Migrant Crisis Tests Core European Value: Open Borders, New York Times, (31 August), [online], available at: <http://www.nytimes.com/2015/09/01/world/europe/austria-migrant-crisis-truck.html?smid=fb-nytimes&smtyp=cur> [accessed 03 September 2015].

Taylor, A., 2015. Why the language we use to talk about refugees matters so much. The Washington Post, (30 July), [online], available at: <https://www.washingtonpost.com/news/worldviews/wp/2015/07/30/why-the-language-we-use-to-talk-about-refugees-matters-so-much/> [accessed 03 September 2015].

UNHCR, 2015. UNHCR viewpoint: 'Refugee' or 'migrant' - Which is right? [online], available at: <http://www.unhcr.org.uk/news-and-views/news-list/news-detail/article/unhcr-viewpoint-refugee-or-migrant-which-is-right.html> [accessed 03 September 2015].

UNHCR, 2015. Global Facts and Figures. [online], available at:

<http://www.unhcr.org.uk/fileadmin/user_upload/pdf/July_2015/PDF_Displacement_Facts_and_Figures_2014.pdf> [accessed 03 September 2015].

Waterfield, B., 2011. France threatens to 'suspend' Schengen Treaty, The Telegraph, (22 April), [online], available at: <http://www.telegraph.co.uk/news/worldnews/europe/italy/8468981/France-threatens-to-suspend-Schengen-Treaty.html> [accessed 03 September 2015].

WHO, 2015. Ebola Situation Reports. [online], available at: <http://apps.who.int/ebola/ebola-situation-reports> [accessed 03 September 2015]

Working papers and conference reports

Bacon, C., 2005. ‘The Evolution of Immigration Detention in the UK: The Involvement of Private Prison Companies’. Refugee Studies Centre, Working Paper No. 27. Oxford, UK.

Carrera, S., 2007. ‘The EU border management strategy: FRONTEX and the challenges of irregular immigration in the Canary Islands’. CEPS Working Document No. 261, Centre for European Policy Studies, Brussels, Belgium.

Çetin, E., 2012. 'Exclusionary Rhetoric, Expansionist Policies? Right-wing Parties and Immigration Policy-making in Italy'. COMPAS Working Paper No. 95, The Migration Observatory, Oxford, UK.

Flynn, M., Cannon, C., 2010. ‘Detention at the Borders of Europe: Report on the Joint Global Detention Project’. International Detention Coalition Workshop, 2-3 October 2010, Geneva, Switzerland.

Niemann, A., Schmidthäussler, N., 2012. ‘The Logic of EU Policy - Making on (Irregular) Migration: Securitisation or Risk?’ UACES conference: Exchanging Ideas on Europe 2012: Old Borders – New Frontiers, 3-5 September 2012, Passau, Germany.

Parkin, J., 2013. ‘The Criminalisation of Migration in Europe: A State-of-The-Art of the Academic Literature and Research’, CEPS Liberty and Security in Europe Papers No. 61, Centre for European Policy Studies, Brussels, Belgium.

Rijpma, J., Cremona, M., 2007. The extra-territorialisation of EU migration policies and the Rule of Law. EUI Working Papers, 2007(1), European University Institute, Florence, Italy.

Van Dijk, D., 2006. “Is the EU Policy on Illegal Immigration Securitizied? Yes of Course! A Study into the Dynamics of Institutionalised Securitization.” In 3rd Pan European Conference on EU Politics, Istanbul, Turkey.

IDPs, Power, Interests & Institutional Pathologies: An Analysis of the Politics of Why There is No International IDP Regime

Marta Corti

Abstract This paper critically analyses the politics of why, despite the magnitude of the issue, there is no global internal displacement regime today. Building on Krasner’s definition of international regimes, it argues that the failed development of an internal displacement regime is largely attributable to states’ interests and power, combined with the politics of international organisations. Indeed, states have little interest in, and political will for, a regime because IDPs’ existence does not challenge the system of states as such and since internal displacement does not directly affect powerful – particularly Western – states. Moreover, the difficulties that the coexistence between the existing refugee regime and an IDP one would entail act as a limiting factor for the formation of an IDP regime. Finally, the politics of refugee and IDP protection, alongside institutional ‘pathologies’ of the UN and UNHCR are explicative of why, rather than fostering regime formation, UNHCR has contributed to hindering it.

Introduction The UN High Commissioner for Refugees António Guterres has described the current epoch as ‘an era of unprecedented mass displacement’ (UNHCR, 2015a). The year 2014 was marked by a record growth in the number of people forcibly displaced worldwide due to persecution, armed conflict, generalised violence or human rights violations, and the trend is growing (UNHCR, 2015b). In this context, internally displaced persons (IDPs) are among the world’s most vulnerable people. The international community defines IDPs as:

‘persons or groups of persons who have been forced or obliged to flee or to leave their homes or places of habitual residence, in particular as a result of or in order to avoid the effects of armed conflict, situations of generalized violence, violations of human rights or natural or human-made disasters, and who have not crossed an internationally recognized state border’ (UN, 2004).

The latest UN estimates set the tally of conflict-induced IDPs worldwide at 38.2 million, which is historically unprecedented (UNHCR, 2015b). The IDP crisis has spared no continent (see Figure 1) and the average duration of internal displacement is on the rise (Beyani, 2015). This makes internal displacement one of today’s most pressing global issues confronting affected countries, as well as the international community at large. In international affairs, regimes are set up by states to govern the behaviour of states, international organisations and NGOs with the purpose of achieving desired outcomes in particular issue areas (Keohane and Stein cited in Krasner, 1983: 7). International regimes are defined by Stephen Krasner as ‘sets of implicit or explicit principles, norms, rules, and decision-making procedures around which actors’ expectations converge in a given area of international relations’ (Krasner, 1983: 2). They offer instruments for addressing specific international issues and shape responses to those issues. For instance, the refugee regime has at its core a treaty framework, comprising of the 1951 Refugee Convention and its 1967 Protocol, and a dedicated international organisation, namely the Office of the United Nations High Commissioner for Refugees (UNHCR), which acts as a regime oversight mechanism and contributes to its implementation (Betts, 2009a: 53). IDPs and refugees are displaced for similar reasons and they are vulnerable to many of the same problems (Feller, 2006: 12). Nevertheless, the two categories are divided by one key difference, which lies at the heart of difficulties in addressing the plight of IDPs. Unlike refugees, IDPs have not crossed any international border to find sanctuary and remain exiled within the territory of their home country. Today, there are almost twice as many IDPs as refugees and asylum seekers combined (UNHCR, 2015b). Yet, paradoxically, while refugees are able to call upon the resources of a complex regime, there is no global regime for IDPs. Indeed, since the 1990s, new governance arrangements have emerged in the area of internal displacement, but they have failed to lead to the development of a fully-fledged regime. Building on Krasner’s definition, this paper will argue that the current IDP framework amounts at most to a regime in the making and it will seek to answer the question of why there is no global IDP regime, made up of a legal system and a tailor-made protection and assistance mechanism. It will do so by critically examining the extent to which states’ interests and power, and the politics of international organisations are responsible for the failed development of a regime. It will be argued that there is no internal displacement regime

because of a lack of interest in and political will for a regime on the part of states, combined with the difficulties of a coexistence between the refugee regime and an IDP one, and the politics and institutional pathologies of the UN and of UNHCR. This paper is divided into five chapters. Chapter 1 contextualises internal displacement as an issue area, as well as explaining why the current IDP framework falls short of being a regime. Chapter 2 explores the role played by states’ power and interests in fostering or hindering regime-development. Chapter 3 analyses the impact of the politics and ‘institutional pathologies’ of the UN and of UNHCR on the failed emergence of an IDP regime. The concluding chapter will provide summary and reflection. Due to its magnitude and current political relevance, the Syrian internal displacement crisis is used as the main example throughout the paper to illustrate some of the arguments. It should be noted that, although internal displacement may also be disaster- or development-induced, this paper focuses on displacement caused by war, generalised violence and human rights violations, as these are causes of forced displacement also contemplated within the refugee regime. Nonetheless, certain considerations also apply to other types of displacement. Chapter 1: The Issue Area of Internal Displacement and its Framework The State of the World’s IDPs

There are at least 38.2 million conflict-induced IDPs in the world – the highest level ever recorded. Since the year 1990, the number of IDPs worldwide has consistently been higher than that of refugees, with a staggering widening of the gap since the year 2000 (see Graph 1). Today, IDPs are almost double the current numbers of refugees and asylum-seekers, who are 19.5 million and 1.8 million respectively (UNHCR, 2015b). These figures are part of an ongoing trend whereby war-induced displacement has been dramatically increasing in magnitude and duration over the past decades (UNHCR, 2015c). Indeed, an estimated 11 million people were newly internally displaced in 2014 alone (UNHCR, 2015b) and recent statistics show that conflict-induced internal displacement lasts seventeen years on average (Blocher, 2014), compared to an average duration of fourteen years in 2004 (Norwegian Refugee Council, 2005: 9). Internal displacement is a global problem. The latest Internal Displacement Monitoring Centre (IDMC) report on the situation of IDPs shows that conflict and generalised violence have continued to fuel internal displacement in every region of the world throughout 2014 (IDMC and Norwegian Refugee Council, 2015). It is worth noting that, although internal displacement is an ongoing issue both in Europe and in the Americas, no Western state is directly affected by war-induced internal displacement. This has a powerful impact on the international politics of internal displacement (see Chapter 2). IDPs are conceptually interesting and politically difficult because they flee war, violence and rights violations, but remain within the borders of their country of origin. Therefore, their government holds the primary responsibility for their protection. As a consequence, access by external actors must be negotiated but, even when it is granted, the displaced are often located in hard-to-reach areas. As internal exiles, IDPs are extremely vulnerable and, during displacement, the vast majority of them suffer from a lack of food and access to basic services, including water, adequate sanitation and health care, as well as being vulnerable to gender-based violence and trafficking (Feller, 2006: 12; MSF USA, 2015).

The International IDP Framework: A Regime in the Making After years of ad hoc, temporary responses to IDP situations, in the early 1990s the magnitude of the internal displacement crisis sparked within the United Nations a legal-institutional debate, which gave a key push for the creation of an internal displacement governance mechanism (Weiss and Korn, 2006). The international legal and institutional lacunae, whereby there was no framework or regime for addressing the IDP issue, was recognised as part of this debate and efforts to put IDPs on the international agenda were begun. In the late-1990s, internally displaced persons were fully recognised as a problem for the international community and they have been - albeit often invisibly (see Beyani, 2015; Ferris, 2015) - on the international agenda ever since (Orchard, 2015). Although internally displaced persons are not the subject of a specific international convention, a framework for their protection and assistance was developed within the UN system between the early 1990s and the mid-2000s. On the legal side of the framework, IDPs’ human rights and rights under international humanitarian law (IHL) were collected into the 1998 Guiding Principles on Internal Displacement (UN, 2004). While, from an institutional point of view, from the 1990s UNHCR gradually expanded its mandate to include and provide protection to increasing numbers of IDPs (see Figure 2). This has occurred particularly since the adoption of the ‘cluster approach,’ following a major UN humanitarian coordination reform in 2005 (Betts, 2009a; Orchard, 2015). The creation ex novo of this framework of protection and assistance to IDPs is a remarkable step forward compared to the complete absence of a legal or institutional framework before the 1990s. However, unlike the comprehensive global regime that refugees are endowed with, the IDP framework remains limited in its practical benefits and in its ability to shape international behaviour, to the extent that it cannot be described as a regime. The following sections explore the reasons why the IDP framework falls short of being an international regime. a. The Guiding Principles The Guiding Principles on Internal Displacement represent the first compilation of international legal principles applying to the protection of IDPs. They define IDPs and identify the rights they are entitled to, as well as setting forth governments, international organisations and non-state actors’ obligations towards them (Cohen, 2013). The 30 principles contained in this legal framework are grounded primarily in international human rights law and IHL, alongside legal standards drawn from refugee law by analogy. The Guiding Principles cover IDPs’ needs in the pre-displacement phase, during displacement and during return or resettlement (Kälin, 2008; UN, 2004). Despite their non-legally-binding character, the Guiding Principles gained broad international acceptance and authority because they are based on existing law. So far, the Guiding Principles have been incorporated into national law in over twenty countries, and NGOs and UN agencies, including UNCHR, have integrated them into the guidelines for their protection activities (Diagne and Entwisle, 2008). The Guiding Principles provide a normative framework for addressing internal displacement and their widespread acceptance suggests that their impact could be similar to that of a regime. However, an analysis of the practical application of the Principles by states and other actors suggests that, far from having become a regime, the framework is at best part of a regime in the making. In fact, the Guiding Principles have not shaped international behaviour

sufficiently to modify it in a regime-like manner and, as a result, IDPs’ needs remain inadequately addressed and, in the worst cases, unaddressed. The non-binding character of the Guiding Principles is the source of two key limitations that can account for why the normative side of the IDP framework can only aspire to be a regime. Firstly, the non-binding nature of the Guiding Principles makes it easier for governments to dismiss them (Cohen, 2013: 12). Secondly, being only soft law, the Guiding Principles lack any monitoring or enforcement mechanism. Consequently, compliance with the Principles remains ‘contingent on international politics and goodwill,’ and non-compliance goes unpunished (Ferris, 2008; Islam, 2006: 365). Studies of the practical application of the Principles have found that states resist implementing them, insisting instead on the applicability to IDPs of (unbeneficial) national laws, on the grounds that the Principles are non-binding (Kälin, 2010: 5). This has occurred particularly in states whose governments are unable or unwilling to fulfil their obligations, one example being Syria. Instead of recognising its internally displaced citizens as IDPs entitled to rights, the Syrian government has been referring to those displaced by the conflict as ‘affected populations who have moved to other areas’ or ‘moved from their homes’. In a number of presidential statements, IDP areas were even depicted as ‘hotbeds for terrorism’ (Charron, 2014: 13). Further to not abiding by the Guiding Principles, the Syrian authorities have grossly contravened IHL and human rights law by attacking civilians with prohibited weapons. These actions by government forces have greatly contributed to exacerbating internal displacement in the country’s territory, as well as forcing many to seek asylum elsewhere (Human Rights Watch, 2014; UN Human Rights Council, 2015). Further evidence suggests that, even those governments who did incorporate the Principles into their legislation, have often been slow at implementing those laws and policies, or have failed to do so at all (Ferris et al., 2011). The African Union’s 2009 Kampala Convention is emblematic of this. The Convention is a legally-binding document, which builds on the Guiding Principles and obliges state parties to actively engage in improving conditions for IDPs on the ground (AU, 2009). The Kampala Convention was signed by fifty-three African states and came into force in December 2012 (IRIN network, 2012). However, the treaty has enjoyed little implementation and there is currently no evidence to suggest that it has effectively improved the way in which the authorities of the state parties respond to internal displacement (Ferris, 2015; Ferris et al., 2015). It is to be noted that the Kampala Convention constitutes an exceptional example of the creation of an IDP treaty by a regional body, which has not been replicated elsewhere and, as some commentators note, is unlikely to kindle interest in a global IDP convention that could underpin a regime (Martin, 2015). Thus, the normative side of the internal displacement framework is yet to prove able to bring about the behavioural changes which are typical of regimes. The crystallisation of the Guiding Principles into hard law in Africa signals a strengthening of the normative basis for bringing about a regime. However, the lack of behavioural change provoked by the Kampala Convention is further evidence to the fact that the internal displacement framework is still a regime in the making. As argued in the following section, this notion is further corroborated by a failure to implement the Guiding Principles even at the institutional level.

b. UNHCR & the Cluster Approach Unlike refugees, IDPs do not have a tailor-made agency for addressing their plight. However, under the institutional side of the IDP framework, UNHCR and other agencies and NGOs belonging to the ‘global protection cluster’ are in charge of IDP assistance and protection. The ‘cluster approach’ was introduced in 2005 to improve the UN’s humanitarian responses’ predictability and accountability. However, in an interview with the author, Thomas Weiss dubbed the cluster approach ‘a typical UN charade’ (Weiss, 2015) due to it having only improved aid delivery in a minor way and having failed to improve accountability (Stoddard et al., 2007; Streets et al., 2010). Each cluster works in a specific area of humanitarian response and comprises of various UN agencies and NGOs, coordinated by a designated lead agency (Orchard, 2015). UNHCR was nominated global cluster lead for protection in conflict situations and it is in charge of the three areas of protection, emergency shelter, and camp management and coordination for IDPs (Weiss and Korn, 2006). UNHCR’s appointment as lead agency for IDP protection fuelled hopes that IDPs’ needs would be more effectively addressed (Weiss and Korn, 2006: 142). Nevertheless, there continue to be shortcomings in IDP assistance and protection that are symptomatic of a key issue within UNHCR. As further explored in Chapter 3, refugees are UNHCR’s core mandate and the agency’s true commitment remains to them (Martin, 2015). Therefore, whenever confronted with instances where protecting IDPs could prove detrimental to its work with refugees in the same country, UNHCR channels its resources towards refugees (Ferris et al., 2015). This results in a failed implementation of the Guiding Principles. Instead of upholding IDPs’ rights and providing them with protection, UNHCR and other agencies, including OCHA, focus on delivering assistance only, rather than giving assistance and protection (Martin, 2015) as provided for in the IDP framework. Examples of this incongruence are found both in UNHCR’s past and present practice. For instance, prior to the establishment of the cluster approach, UNHCR officials in Bosnia avoided raising human rights issues for fear that the belligerents would respond by preventing food deliveries or deliveries of other essential goods (Minear, 1994). UNHCR’s current involvement in the Syrian civil conflict is exemplar of this too. Fearing an arbitrary access revocation by the government, the Office is making huge compromises in order to be allowed to remain in Syria, including focusing on delivering assistance only. This practice has been strongly criticised from within and outside UNHCR (Barnett, 2001; Ferris et al., 2015; Martin, 2015). These examples highlight how deeply problematic the institutional side of the IDP framework is. The introduction of the cluster approach has failed to change the practice of prioritising assistance over protection, contrarily to UNHCR’s protection mandate and duty to uphold Guiding Principles. Therefore, even the institutional side of the IDP framework falls short of having regime-like characteristics. To sum it up, the ongoing internal displacement crisis is a problem whose scale has consistently been larger than that of the refugee crisis, and the upward trend in IDP numbers suggests that this global issue is likely to concern the international community for a long time. The existing framework is limited both in its ability to respond and deal effectively with the internal displacement issue (Egeland quoted in Blocher, 2014) and in its ability to govern the states’ and IOs’ behaviour. This means that, despite providing the normative and institutional basis for a theoretical regime, the IDP framework falls short of being a fully-fledged regime and remains akin to a regime in the making.

Considering that the IDP problem is more pressing than the refugee one and that the internal displacement framework does not constitute a regime, the question arises of why there is no IDP regime. This conundrum is explored in the following chapters. The next chapter critically assesses the role played by states’ power and interests in the failure to constitute a global IDP regime. Chapter 2: States, Interests & Power States are the key actors in the international system and their response, or failure to respond, to the plight of the forcibly displaced is shaped by configurations of power, interests and ideas, as well as to an extent by the role of institutions, such as UNHCR (see Chapter 3) (Betts et al., 2012: 93). States’ power and interests are also the basic reasons why regimes are created (Krasner, 1983: 21). Thus, understanding their role is essential to explaining why there is no global IDP regime. In order to analyse the linkages between power, interests and internal displacement, the concept of sovereignty and its relationship with forced migration, specifically concerning internal displacement, need to first be explored as such a relationship is central to the international politics of displacement (Betts, 2009b; Betts et al., 2012: 93, 133). Sovereignty and the International System of States

The modern concept of sovereignty as entailing principles of non-interference and non-intervention in states’ internal affairs is conventionally traced back to the creation of the modern state system. The 1648 Peace of Westphalia marked the birth of the nation-state, based on an assumed population-territory-authority nexus, which initiated a new world order grounded in the concept of national sovereignty (Betts, 2009b: 43–46; Hinsley, 1986: 17). In its traditional understanding, sovereignty was deemed to grant states the sole power over and responsibility for their own affairs. By the end of the twentieth century the European sovereign state system had expanded worldwide and ‘the political division of the globe into territorially delineated states had become the dominant universal mode of political organization’ (Bull and Watson cited in Betts, 2009b: 43). Therefore, the notion of sovereignty is the basis of inter-state relations and international law, and it has long been considered as ‘the essential lens through which we understand the way the world operates’ (Weiss and Korn, 2006: 5–6). Alongside the expansion of the dominant sovereignty paradigm, the twentieth century also witnessed the emergence of IHL, human rights law and refugee law, which focus on the relationship between the state and the individual (Betts, 2009b: 47). Thanks to these normative shifts and to the work of IDP advocates, by the end of the century there was a growing consensus that sovereignty is conditional or ‘contingent’ upon states’ behaviour vis-à-vis their population. The Special Representative of the UN Secretary-General on IDPs (RSG), Francis Deng, put forward the concept of ‘sovereignty as responsibility’ as the most appropriate protection framework for IDPs (Weiss and Korn, 2006). ‘Sovereignty as responsibility’ posits that the primary responsibility for IDP’s safety and wellbeing lies with their governments. However, when governments are unable or unwilling to fulfil their responsibilities, they are expected to seek and/or accept assistance from the international community (Cohen, 2010: 39–40). This concept has enjoyed wide international acceptance since the late 1990s (Weiss, 2015; Weiss and Korn, 2006).

A further move away from traditional sovereignty occurred in the twenty-first century with the development of the concept of ‘responsibility to protect’ (R2P). Building on the notion of ‘sovereignty as responsibility,’ R2P was officially adopted by UN member states at the 2005 World Summit. Like its antecedent, R2P places primary responsibility on states to protect their population, but it provides that the international community has a responsibility to take ‘collective action’ when populations are threatened by genocide, war crimes, ethnic cleansing and crimes against humanity. Such action can take the form of diplomatic, humanitarian or other peaceful means, as well as, if necessary, the use of force under Chapter VII of the UN Charter (Cohen, 2010: 41). Given that R2P covers issues which are major causes of displacement, there was a general expectation that it would be beneficial to IDPs by expanding the normative basis for their protection (Mooney, 2010), as well as by helping convert the IDP framework into a regime. However, as argued later in this chapter, that has not been the case. Sovereignty and Forced Migration ‘Sovereignty’ has been employed as a discursive tool for justifying or explaining state behaviour both in international practice and in the discipline of International Relations (IR). Different IR theoretical approaches can provide diverse insights into sovereignty’s relationship with internal displacement. In particular, Stephen Krasner’s ‘organised hypocrisy’ model (Krasner, 2012, 2001, 1999) and Constructivism, prove helpful in explaining how sovereignty is ‘a norm based upon a set of practices which shape and constitute states’ behavior in complex ways’ (Betts, 2009b: 48), as well as how this affects responses to internal displacement. Krasner (1999) argues that state sovereignty has historically never been absolute. On the contrary, sovereignty is an ‘organised hypocrisy’ embodying a paradox. While constituting a longstanding norm, sovereignty is frequently violated, especially when it is in the interests of powerful states to do so. According to Krasner, sovereignty has been violated both by voluntary agreement and by coercion thanks to the contradictory nature of certain international norms, such as non-intervention and human rights (Krasner, 2001, 1999). This has occurred because power asymmetries allow the more powerful states to ‘pick and choose among different rules selecting the one that best suits their instrumental objectives’ (Krasner, 1999: 6). Indeed, it is ‘differences in national power and interests, not international norms, [that] have been and continue to be the most powerful explanation for the behavior of states’ (Krasner cited in Betts, 2009b: 50). In the context of forced migration, the concept of sovereignty as organised hypocrisy highlights how focusing excessively on sovereignty as the main barrier to international action, in fact obscures a ‘diverse range of responses to different groups of forced migrants, within different regions […] and historical contexts’ (Betts, 2009b: 50). A similar argument is made by Noam Chomsky (1999). While assessing international humanitarian responses to internal displacement, Chomsky contrasted the international community’s deficient response to internal displacement in Chechnya in the late 1990s with its active, albeit self-interested, response in Bosnia and Kosovo. As Betts puts it, ‘sovereignty is often used to justify inaction but is frequently violated or circumvented when doing so is in the interests of the powerful’ (Betts, 2009b: 50). Constructivists Thomas Biersteker and Cynthia Weber concur with Krasner that state sovereignty has never been an absolute, explaining that it is in fact a social construct resulting

from a particular, historically-contingent normative conception (Biersteker and Weber, 1996). The Constructivist approach unveils a mutually constitutive relationship between sovereignty and forced migration. On one hand, the categories of ‘refugees’ and ‘IDPs’ are entirely relational to sovereignty and the state system, because they only exist in relation to states’ borders. On the other hand, states’ responses to forced migration through practices of exclusion and inclusion, based on their physical borders, construct an external ‘other’ - in contrast to citizens. Thus, the categories of ‘refugee’ and ‘IDP’ serve to reinforce the state system and the concept of sovereignty by normalising the insider/outsider relationship between citizens and non-citizens (Betts, 2009b: 53; Biersteker and Weber, 1996; Haddad, 2008: 1). However, there exists a key difference between how IDPs and refugees relate to the state system, which provides one of the main reasons why the latter are endowed with a regime, unlike IDPs. The existence of refugees challenges the notion of an unproblematic nexus between state, territory and citizen that the state system and traditional sovereignty are premised upon (Betts, 2009b: 44). Aside from challenging traditional conceptions of sovereignty, refugees represent a problem for the system of states (Haddad, 2008). They expose a discrepancy between the idealised concept of sovereignty and the practice of the state system, thus representing ‘an anomaly or failure of the state system’ (Betts, 2009b: 54). The refugee regime was created with the aim of correcting such an anomaly by offering the means to reintegrate refugees into the ‘normal’ logic of the system of states (Haddad, 2008: 113–127). An ulterior reason for the establishment of the refugee regime emerges from a historical analysis of the interests of powerful states. Indeed, ‘it is unrealistic to imagine that the problem of refugees can ever be entirely non-political’ (Goodwin-Gill, 2008: 8). The contemporary regime emerged in the wake of World War II (WWII) to resolve European refugee situations, whose destabilising potential for the region was feared by the Western powers who were bearing their burden. The regime was then expanded and shaped by the interests of powerful Western states in the context of the Cold War East-West rivalry (Betts et al., 2012; Weiss and Korn, 2006). Hence, the refugee regime was developed primarily due to the political interests and practical needs of powerful states, rather than for purely humanitarian purposes (Goodwin-Gill, 2008; Weiss, 2015). Contrary to refugees, internally displaced persons do not pose a problem for the system of states. This has an impact on the politics of power and interests that underpin the failed development of a global IDP regime. The System of States, Interests and Power

By remaining in their country of origin, IDPs uphold state sovereignty and they are primarily problematic for their own state.1 Until the shift to ‘sovereignty as responsibility,’ ‘sovereignty’ was used as a discursive tool to justify the international community’s inaction or limited action to protect IDPs. The main argument was that ‘states and the international community could not interfere in the affairs of a sovereign state’ (Betts, 2009b: 56). Therefore, so long as the forcibly displaced remained within the borders of their own country, they were considered that state’s responsibility, instead of that of the international community. In other words, ‘there was no IDP regime because the border mattered’ (ibid.). This view was shared by a number of states, including Mexico, India, China and Sudan, who 1 Note that internal displacement can contribute to regional destabilisation (Weiss and Korn, 2006).

regularly restated their support for traditional interpretations of sovereignty even after the creation of the Guiding Principles and acceptance of ‘sovereignty as responsibility’ as a norm (Weiss and Korn, 2006: 67). The notion of an inviolable sovereignty was not the only obstacle to the early formation of an IDP regime. States’ narrow definition of their national interests was equally significant (Annan, 1999). In the 1990s, IDPs were hardly on the international agenda and states in the North and South were directly confronted with the more pressing issue of refugees. Therefore, they saw the time-consuming development of an international IDP convention, that could have contributed to the creation of a regime, as being beyond their national interest. This is why the states parties to the UN Commission on Human Rights (CHR) usually responded to RSG Deng’s suggestions for consolidating existing international instruments into a legally-binding document, with general resolutions that merely asked him to continue with his research on how to improve IDP protection and assistance (Weiss and Korn, 2006: 41). The ‘success’ of the Guiding Principles lay in their use of existing international laws, that states had already agreed to, to create a non-binding document. The Principles met the interests of powerful states because they laid on the states of origin the primary responsibility for protecting their citizens, but conferred on the international community the responsibility to intervene to protect IDPs when their government was unwilling or unable to do so. The flexibility of a soft law mechanism allowing external intervention into sovereign states was welcomed at the time because several states held security concerns about internal displacement’s potential for spill-over into other countries. For instance, the Principles met the interests of many Northern states who were seeking ways to curb asylum and migration by intervening in Southern states to ‘contain’ outward flows (Duffield cited in Betts, 2009b: 57; Cohen, 2010). Thus, although the Guiding Principles seemingly eroded traditional sovereignty through the notion of ‘sovereignty as responsibility,’ the resulting IDP framework in fact ‘helps to reinforce sovereignty, albeit the sovereignty of powerful states’ (Betts, 2009b,: 57). Therefore, because IDPs are mainly unproblematic for the system of states and since a binding document was not in the interests of powerful states, during the 1990s there was no political will for establishing a legally-binding IDP regime. Instead, the legal framework of the Guiding Principles met states’ interests because it acknowledged humanitarian concerns, without regulating behaviour in a regime-like manner which would have put them under a legal obligation to intervene, whether using peaceful means or by force. The framework allowed flexible responses to IDP crises according to the broader interests of powerful states, as denounced by Chomsky in his comparison of international response in Chechnya, Bosnia and Kosovo. In Krasner’s terms, the seeming erosion of sovereignty through the development of the IDP framework in fact simply eroded some aspects of sovereignty – its alleged inviolability – reinforcing others, namely powerful states’ ability to control trans-boundary flows (Betts, 2009b: 59). In assessing why the IDP framework is yet to become a fully-fledged regime, it is also important to analyse which states are affected by the issue, how this shapes their interests and the norms they uphold, as well as the impact of existing configurations of power on them. States affected by internal displacement generally display resistance to a stronger IDP

framework or a regime,2 fearing infringements on their sovereignty. Opposition has often been raised to intervention in situations of internal displacement (Betts et al., 2012: 61), with some states concerned that ‘humanitarian action could be a cover for the interference of powerful countries in the affairs of weaker states’ (Cohen, 2002: 440–41). For instance, in 2014 the Syrian authorities presented a letter to the Secretary-General where they stated that delivering aid without consent constitutes an attack on their country’s sovereignty by states intent in aiding terrorists. Syria further claimed that its ‘refusal to allow the United Nations and non-governmental organizations to deliver aid without its formal approval [was] grounded in and motivated by the Charter of the United Nations’ (Syrian Arab Republic, 2014). Non-Western powers show reluctance towards creating any regime that could ultimately infringe on their sovereignty. For instance, China hosts no recorded IDPs (IDMC and Norwegian Refugee Council, 2015) and it displays no interest in a global IDP regime. On the contrary, it insists on an approach to international affairs that defends non-intervention (Pang, 2009). China’s example also shows how R2P has remained primarily a discursive tool that failed to fulfil its promises of benefitting IDPs when confronted with powerful interests. For instance, upon request from Sudan, in 2007 China used its power as a permanent member to veto any reference to R2P in the UN Security Council resolutions concerning the internal displacement crisis in Darfur (Cohen, 2010: 42). Rather than strengthening the IDP framework, R2P has been of little impact on it in the face of powerful interests and political divisions. The Syrian war exemplifies this. The Syrian authorities have repeatedly failed to comply with the Guiding Principles and protect civilians from and during displacement, as well as having directly targeted and forcibly displaced civilians as a war strategy. Similar strategies have been employed by ISIS and other terrorist groups (IDMC and Norwegian Refugee Council, 2015: 39). It is widely acknowledged that some of the violations committed in Syria constitute war crimes and crimes against humanity (UN Security Council, 2014, para. 1), which are direct concerns of R2P. However, political divisions and conflicting interests in the Security Council, with Russia and China continuing to promote sovereignty above R2P, have effectively led to a ‘failure to protect’ Syrian IDPs (Adams, 2015: 5; Shukla, 2008). The Security Council’s Syrian impasse underlines how norms are used by powerful states to legitimise certain forms of global order. As argued by Andrew Hurrell (2007), a discursive use of traditional sovereignty, as well as skilful influences on institutions, can be employed by powerful actors to justify derogations to sovereignty or to uphold it as a means to fulfil their interests. As noted in Chapter 1, internal displacement does not pose a direct problem for Western states, who are primarily preoccupied with refugee and migrant flows. The West pushed for creating a refugee regime after WWII because it needed assistance in dealing with refugees in the aftermath of the war, and because it obtained political gains by taking in communism’s escapees during the Cold War (Betts et al., 2012). Conversely, there is no direct political gain in establishing a regime for IDPs. The forcibly displaced tend to become problematic for Western states only when they cross international borders and seek asylum there, as we are seeing with the increasing concerns over Europe’s Syrian refugee crisis (see Dyke, 2015). Although powerful Western states have historically been at the forefront of regime-

2 The states parties to the Kampala Convention constitute an exception to this. Nevertheless, outstanding issues concerning implementation (see Chapter 1) are evidence to the fact that there is no universal political will for a stronger regime.

development, the fact that the global issue of internal displacement affects them only indirectly constitutes a disincentive for developing a regime beyond the existing framework. Similarly to the 1990s, Western – particularly European – powers today could be interested in an IDP regime as a means to contain asylum-seekers. Some commentators argue that, since the beginning of the Syrian crisis, European asylum states have displayed an interest in sending additional resources to support IDPs inside Syria, as well as to Middle Eastern asylum states, so that fewer Syrians would seek asylum in Europe (Ferris, 2013). For instance, the UK government has recently been considering plans to increase aid to asylum states bordering Syria (BBC News, 2015). Similarly, Syria’s neighbouring states, who are the main bearers of the heavy economic and social brunt of the Syrians’ exodus, find increased humanitarian involvement in Syria desirable in order to contain refugees (Ferris, 2013).3 These increased concerns may be suggestive of an interest in the development of an IDP regime, but they also highlight a deep tension between the existing refugee regime and a theoretical IDP regime, which make a full development of the latter unlikely. As further discussed in Chapter 3, a strong regime of in-country protection and assistance could curtail the asylum option, which is the cornerstone of the refugee regime. There exists a tension in that ‘IDPs should be supported inside Syria because they have clear and often desperate needs, but at the same time, their right to seek protection in other countries must be upheld’ (ibid.). This tension between IDP protection and asylum suggests that the refugee and an IDP regime could not coexist because addressing the issue of internal displacement in the country of origin through a regime would to an extent limit asylum. Having created and contributed to developing a complex refugee regime, states are legally bound to maintaining the institution of asylum. As a consequence, the existence of the international refugee regime, combined with the fact that powerful states are not directly affected by internal displacement, is a disincentive for establishing a potentially clashing IDP regime. The continued pre-eminence of the refugee regime is corroborated by an analysis of UNHCR funding for 2014, revealing that contributions by governments and the European Union (EU) for refugee programmes amounted to over USD 1 billion, compared to only USD 417 million donated to IDP projects (UNHCR, 2014). This is indicative that, despite the large disparity in numbers, states are far more concerned with refugees than IDPs. Moreover, it suggests that UNHCR – which establishes its budgetary needs prior to launching its yearly appeals (Betts et al., 2012) – has an interest in maintaining its core refugee mandate (see Chapter 3 for further analysis of this point). In the absence of an IDP regime and in the unlikelihood of the creation of one beyond the existing framework, it is unsurprising that so many flee Syria on a daily basis. It seems evident that crossing a border and accessing the protection of the refugee regime, is currently the best option for them, if they wish to enjoy rights and protection. Indeed, as previously noted, despite being fewer in numbers, refugees benefit from a complex legal and institutional regime, contrary to IDPs’ often ineffective framework (Weiss, 2003). To sum it up, several reasons contribute to explaining the role of states’ interests and power in the failed development of an IDP regime. Firstly, unlike refugees, IDPs are problematic for their state of origin, rather than challenging the system of states. Secondly, the fact that IDPs

3 This does not suggest that there is no genuine humanitarian concern for IDPs. However it does highlight how aid is never purely altruistic (Betts et al., 2012, p. 102).

are not a direct concern of powerful states is a disincentive for creating an IDP regime. Thirdly, the existence of a strong refugee regime curtails the possibility of creating an equally strong IDP one. Therefore, states often conceal their limited interest in, and political will for, an IDP regime through a discursive use of sovereignty. The next chapter assesses the extent to which international organisations may have contributed to the failed development of the IDP framework into a regime and why. Chapter 3: The UN & UNHCR International organisations’ (IOs) significance to world politics is now widely recognised in International Relations theory and practice (see Abbott and Snidal, 1998; Barnett and Finnemore, 2004; Hawkins et al., 2006). Michael Barnett and Martha Finnemore (2004, 1999) acknowledge states’ influence over international organisations, but also point out that IOs are international actors in their own right, which have the power to have independent effects on the world (Barnett and Finnemore, 1999: 699). International organisations’ power is derived from two main sources. Firstly, from ‘the legitimacy of the rational-legal authority they embody’. Secondly, IOs’ power derives from their ‘control over technical expertise and information’. This allows them to orient action and influence outcomes (Barnett and Finnemore, 2004: 6; 1999: 707). For instance, IOs can channel their power towards influencing states, as UNHCR has done when shaping the refugee policy agenda and the evolution of the refugee regime (Betts et al., 2012). International organisations’ failures are often blamed on states who do not provide them with appropriate funding or design them to fulfil political criteria, rather than performance ones. Counter-intuitively, Barnett and Finnemore argue that ‘IOs often generate their own mistakes, perversities, even disasters’ because the very rational-legal characteristics that make them powerful can also be their weakness (Barnett and Finnemore, 2004: 8). Being bureaucracies, IOs tend to develop an internal culture and internal bureaucratic processes that shape their behaviour, which often proves dysfunctional for their mandate and aims. Barnett and Finnemore dub such dysfunctional behaviour ‘organisational pathologies’ (Barnett and Finnemore, 2004, 1999). Although organisational pathologies can be attributed primarily to bureaucratic culture, they do not emerge in isolation from the external environment of the organisation. The internal characteristics of the organisation that make them prone to the pathologies may also be shaped by external pressures, such as conflicting demands from states, that can give rise to internal divide and cultural contestation (Barnett and Finnemore, 1999: 725). This is exemplified by the case of the UNHCR internal debate on the effects of expanding its mandate to IDPs illustrated later in this chapter. Barnett and Finnemore’s nuanced understanding of IOs is helpful for further analysing why the IDP institutional framework is yet to be developed into a regime. Such analysis ought to begin by examining how the politics of the UN, which is the institutional context in which the internal displacement debate emerged, have impacted regime-formation. The UN and its Institutional Pathologies Thomas Weiss (Weiss, 2012: 13–14) ‘diagnosed’ the United Nations as suffering from three main institutional pathologies. Firstly, as also seen in Chapter 2, political divisions between

member states generate barriers to diplomatic initiatives and policy changes, as well as impacting the work of the organisation at large. Secondly, the IO suffers from ‘structural problems arising from overlapping jurisdictions and the lack of coordination and centralized financing among UN agencies and bodies.’ Finally, its bureaucratic nature tends to be a source of issues for the United Nations due to its cumbersome character. In 1988, a UN-sponsored conference first exposed a gap in the United Nations system whereby the UN lacked any institutional or legal arrangement for the assistance and/or protection of IDPs. At the time, IDP protection was an issue that the UN system was ‘wholly unprepared and institutionally ill-equipped’ for, because dealing with it meant confronting states’ sovereignty (Weiss and Korn, 2006: 24). The initial institutional efforts for developing the IDP framework were not without difficulties, partly due to a reluctance by some UN practitioners to acknowledge internal displacement as a distinct issue area, which is ascribable to Weiss’ third UN pathology. For instance, when called upon to explore the need for an international mechanism to coordinate IDP relief programmes, the then Secretary-General Javier Pérez de Cuéllar showed resistance to the idea (Weiss and Korn, 2006: 16). In a report issued in 1989 - when conflict-induced IDPs worldwide were already 16.5 million (IDMC, 2015) – the Secretary-General responded that he did ‘not believe it necessary or appropriate to establish a new mechanism or arrangement to ensure the implementation or overall coordination of relief programs to internally displaced persons’ (Cuénod, 1991, para. 118). Once the initial resistance was overcome, regime-formation beyond the current framework was hindered by further manifestations of the UN’s institutional pathologies. A clear example of the influence of an institutional pathology on regime-formation was the internal opposition to the creation of an IDP agency or the designation of UNHCR as the agency responsible for IDPs in the late 1990s. After assuming the position of UN Secretary-General in 1997, Kofi Annan appointed Maurice Strong to conduct a system-wide review of the United Nations, aimed at reforming it. The penultimate draft of Strong’s reform proposal included recommendations to assign responsibility for IDPs to UNHCR, with a view to creating in the long term a consolidated UN humanitarian agency (Weiss and Korn, 2006: 78). UNHCR welcomed the idea and started campaigning to become the lead UN humanitarian agency (Betts et al., 2012). However, these suggestions were met with ‘fierce opposition’ by other UN agencies - especially UNICEF and the World Food Programme (WFP) - and NGOs, who feared that UNHCR would ‘come to loom over them in size and authority’. Their objections were backed by donor states, therefore Annan had no option but to abandon the reform project (Weiss and Korn, 2006: 78). Thus, institutional pathologies, in the form of intra-UN and NGO bureaucratic objections, were at the root of why efforts to build a strong institutional framework were curtailed and the institutional side of the internal displacement framework remained under-developed for several years. Following a UN-wide humanitarian reform in 2005, UNHCR was established as the leader of the IDP protection cluster, thereby becoming the centre of the institutional framework for IDPs. Given that the institutional side remains the weakest in the framework, as well as representing a key reason why it is yet to amount to a full regime (Martin, 2015), analysing the politics and institutional pathologies of UNHCR in relation to internal displacement can shed light on additional reasons why there is no internal displacement regime.

The Politics and Institutional Pathologies of UNHCR

UNHCR’s Statute makes no reference to internally displaced persons, but Article 9 provides that ‘the High Commissioner shall engage in such additional activities […] as the General Assembly may determine, within the limits of the resources placed at his disposal’ (UNHCR, 1996). Consequently, although the first instance of UNHCR involvement in IDP protection occurred in Sudan as early as in 1972, the Office’s work with IDPs remained extremely sporadic and ad hoc until the early 1990s (Feller, 2006). In the 1990s, with the General Assembly’s support, UNHCR undertook a progressive revisiting of its mandate to allow direct involvement with IDPs when political and budgetary needs were met, and by 1996 only 50% of its ‘populations of concern’ were refugees (Betts et al., 2012). The year 1991 was important for UNHCR’s work with IDPs for two reasons: it was a turning point for UNHCR’s involvement in situations of internal displacement, as well as marking the beginning of a decade-long debate about whether or not the Office should incorporate IDPs into its mandate. When that year the UN Security Council authorised the creation of ‘safe havens’ in Iraq, High Commissioner Sadako Ogata decided to engage UNHCR as the primary provider of IDP protection. Ogata’s decision was highly controversial within the Office as the ‘internal flight alternative’ provided by the ‘safe havens’ was perceived to legitimise Turkey’s refusal to open its borders to the Kurds, thus denying asylum to bona fide refugees (Betts et al., 2012: 135; Loescher, 2001). In the decade that followed, UNHCR was engaged in an intense internal debate about whether or not to take on IDPs. On one side, similarities between IDPs and refugees were highlighted as a reason for mandate expansion (Betts et al., 2012). On the other, increased IDP protection was thought to be ‘detrimental to the traditional asylum option,’ which is the keystone of the refugee regime (Barutciski quoted in Orchard, 2015: 301). Moreover, there were widespread concerns that the growing interest in IDPs was in fact ‘a strategy designed to deflect scrutiny of the refusal of states to live up to their responsibilities to refugees’ (Hathaway, 2007: 357). Ogata eventually decided in favour of gradually taking on IDPs, a reason for this being that refugee numbers were decreasing in the late 1990s, with a consequent shrinking of UNHCR’s traditional population of concern (Betts et al., 2012). This made it necessary for the Office to ‘jump on the IDP bandwagon’ in order to maintain its relevance (Betts, 2009a; Martin, 2015). Thus, in the 1990s there was no strong appetite within UNHCR for advocating for developing an IDP regime due to internal divisions regarding the IDP issue. Ogata’s decision to expand the Office’s mandate to IDPs is symptomatic of what Alexander Betts and colleagues described as the central challenge UNHCR has faced throughout its history: balancing its core refugee mandate responsibility with the desire to remain relevant in the international system and address the issues of the changing environment it works in (Betts et al., 2012, p. 79). This very challenge consists of a manifestation of Weiss’ second UN pathology in that it arises from overlaps in the issues that the United Nations’ agencies deal with, as well as resulting from a lack of coordination and centralised financing to the agencies. This challenge constitutes a major institutional pathology for the Office because it is responsible for the practical problems that continue to afflict the IDP framework and cause it to fall short of being a regime. Pressures on UNHCR to maintain its relevance have emerged not only due to shifts in refugee and IDP numbers, but also due to the evolving politics of protection, shaped by increased institutional complexity and the consequent heightened competition for funding. Since the 1990s, the institutional environment has become more competitive for UNHCR due to the

emergence of a host of humanitarian NGOs combined with the presence of overlapping institutions, such as the International Organisation for Migration (IOM). By providing states with more choice regarding which institution to address issues through, institutional complexity put increasing pressure on the Office. In order not to be sidelined, UNHCR saw itself forced to go beyond the boundaries of its original mandate and formally take on new issue areas, including internal displacement (Betts et al., 2012: 130–131). The competition ‘for resources and primacy within the ever-expanding humanitarian community’ has continued even after the Office was made the lead agency responsible for IDP protection under the cluster approach (Betts et al., 2012: 119). Tensions have remained between the agency and its partners – both UN agencies and NGOs – about the limits of their activities, with UNHCR being concerned about ‘other agencies encroaching on their core mandate responsibilities’ (ibid.). Competition over funding has remained a constant too. In particular, there have been close partnerships, as well as frequent tensions with WFP, UNDP and IOM, from different priorities and programmes in the field, competition over funds and perceived expansionist desires (Betts et al., 2012: 120–122). For these reasons, UNHCR’s relationship with other organisations has been described by Betts et al. as being ‘marked by both close cooperation and bitter competition’ (Betts et al., 2012: 119). This ongoing competition has been to the detriment of a more comprehensive engagement in IDP-related issues, contributing to limiting the effectiveness of the institutional response and hindering the full development of a regime. Moreover, following the institutionalisation of UNHCR’s responsibility for IDP protection under the cluster approach, the tension between its refugee mandate and broader mandates has also remained a constant feature and institutional pathology, bearing negatively on its work and obstructing regime development. When UNHCR became the agency responsible for IDP protection, it seemed that widespread hopes that IDPs would no longer be institutionally and practically secondary to refugees had been fulfilled (see Martin, 2015; Weiss and Korn, 2006). Nevertheless, UNCHR still chooses to help refugees only, whenever assisting IDPs could be detrimental to fulfilling its refugee mandate. This was confirmed by declarations of the current High Commissioner. Guterres holds that refugees are UNHCR’s core mandate, with the organisation also having a mission to ensure the protection of internally displaced persons and other populations of concern (Guterres cited in Betts et al., 2012: 77). Nevertheless, he also recently admitted that, precisely because the Office’s core mandate are refugees, the refugee mandate will take precedence whenever there are conflicts regarding IDP protection (Ferris et al., 2015). Indeed, the agency fears that its involvement with IDPs could compromise relationships with host governments or belligerent parties to the extent that it would negatively affect its refugee work (Feller, 2006: 13). Moreover, UNHCR harbours concerns about its IDP operations having a negative impact on funding for its refugee and returnee programmes (Morris, 2006). As a consequence, IDPs remain secondary to refugees for UNHCR and the Office does not display an interest in advocating for a strengthening of the IDP framework into a regime. This is also visible in the Office’s aforementioned allocation of funding and in the practice of IDP protection. Despite IDPs being almost twice as many as refugees and asylum seekers combined, UNHCR’s budget gets regularly disproportionately allocated in favour of refugees. In 2014, 73% of the overall funding (USD 4.5 billion) were allocated to refugee programmes, while IDP projects were only allocated USD 1.3 billion, or 22% of the total budget (UNHCR, 2014: 134).

The ongoing Syrian internal displacement crisis has once again exposed difficulties in reconciling UNHCR’s refugee and IDP mandates. With its estimated 7.6 million IDPs, Syria is the country with most IDPs in the world (UNHCR, 2015a). However, as denounced by Joel Charny, despite currently being the agency with the most robust capacity in Syria, UNHCR has primarily been focusing on assisting the country’s 126,000 Iraqi refugees (Ferris et al., 2015). There are two main reasons for this. On one hand, security concerns and access constraints, including government-imposed restrictions, greatly contribute to UNHCR’s inability to deliver effective protection to IDPs located in hard-to-reach or besieged areas (Ferris et al., 2015; UN Security Council, 2014). On the other, a deeper analysis of the situation unveils the uncomfortable reality that to an extent UNHCR seems almost ‘reluctant’ to assist IDPs for political reasons. Indeed, many within UNHCR fear that putting more pressure on the Assad government would jeopardise refugee protection in Syria, as well as curtailing the Office’s already limited access to IDPs (Martin, 2015). In the light of these considerations, it comes with little surprise that so many Syrians flee to the neighbouring countries and to Europe, where UNHCR has a larger presence and they are under the protection of the refugee regime. Syria’s case is evidence that the IDP institutional framework is not capable of regulating international behaviour or producing behavioural change, which are necessary features of regimes. At the root of this, there are the internal politics of UNHCR and inter-agency politics, combined with external pressures. UNHCR’s struggle to uphold its protection duty towards IDPs is not confined to Syria. It is also visible in South Sudan and the Central African Republic, among others (Ferris et al., 2015; Martin, 2015). To sum it up, alongside donor pressures and other external pressures, the progressive evolution of the IDP institutional framework has historically been shaped by the UN’s institutional ‘pathologies’. Today, part of the reason why we are still lacking a comprehensive IDP regime is largely traceable to the politics of refugee and IDP protection, including UNHCR ‘organisational pathologies’ and inter-agency competition, which have prevented the development of a regime. Conclusion Internal displacement is one of the most pressing global issues of our epoch and its magnitude is far greater than that of the refugee crisis. Nevertheless, contrary to asylum, international behaviour in the issue area of internal displacement is not governed by any regime. This raises the question of why the IDP framework, comprising of the Guiding Principles on Internal Displacement and of the global protection cluster, has fallen short of becoming a fully-fledged regime. As the above analysis has attempted to show, states’ interests and power, as well as the politics of international organisations, have contributed to the failure to establish a global internal displacement regime. Firstly, there is little international interest in and political will for creating an IDP regime due to the fact that IDPs, unlike refugees, are not problematic for the states system as a whole, and since they also tend not to directly affect powerful – particularly Western – states. Secondly, the IDP framework has not evolved into a regime because the existence of an internal displacement regime would to an extent clash with the existing refugee one, thus limiting the asylum option. Finally, these politics of refugee and IDP protection and internal ‘pathologies’ of UNHCR are explicative of why, rather than fostering regime formation, the agency has contributed to hindering it.

The case of Syria corroborates this argument, as well as exposing the deficiencies of the international response to internal displacement crises. Considering that IDPs’ assistance and protection needs are often inadequately addressed by both their countries of origin and the international community, added to the fact that there is no IDP regime to modify this behaviour, the rate at which so many of the forcibly displaced decide to cross the borders of their countries is unsurprising. Indeed, ultimately, it seems more beneficial for internally displaced persons to flee their country and become asylum-seekers and refugees, because their plight is more likely to be addressed within the existing refugee regime.

Bibliography Abbott, K.W., Snidal, D., 1998. 'Why States Act through Formal International Organizations'.

Journal of Conflict Resolution 42, 3–32.

Adams, S., 2015. 'Failure to Protect: Syria and the UN Security Council' (Occasional Paper Series No. 5). Global Centre for the Responsibility to Protect.

Annan, K.A., 1999. 'Two concepts of sovereignty'. The Economist 18. AU, 2009. African Union Convention for the Protection and Assistance of Internally

Displaced Persons in Africa (Kampala Convention). Barnett, M., 2001. 'Humanitarianism with a Sovereign Face: UNHCR in the Global

Undertow'. International Migration Review 35, 244–277. Barnett, M., Finnemore, M., 2004. Rules for the World: International Organizations in

Global Politics. Cornell University Press, Ithaca, NY. Barnett, M., Finnemore, M., 1999. 'The politics, power, and pathologies of international

organizations'. International Organization 53, 699–732. BBC News, 2015. 'UK to accept 20,000 refugees from Syria by 2020'. BBC News Online.

Betts, A., 2009a. 'Institutional Proliferation and the Global Refugee Regime'. Perspectives on Politics 7, 53–58.

Betts, A., 2009b. Forced Migration and Global Politics, 1 edition. Wiley-Blackwell, Chichester, U.K. ; Malden, MA.

Betts, A., Loescher, G., Milner, J., 2012. The United Nations High Commissioner for Refugees, 2 edition. Routledge, New York.

Beyani, C., 2015. Report of the Special Rapporteur on the human rights of internally displaced persons, Chaloka Beyani (No. A/HRC/29/34). UN General Assembly.

Biersteker, T.J., Weber, C., 1996. State Sovereignty as Social Construct. Cambridge University Press.

Blocher, J., 2014. 'IDMC’s annual flagship report reveals record breaking IDP figures for second year running'. IDMC.

Charron, G., 2014. 'Syria: Forsaken IDPs adrift inside a fragmenting state'. IDMC.

Chomsky, N., 1999. The New Military Humanism: Lessons from Kosovo. Pluto Press, London.

Cohen, R., 2013. 'Lessons from the Development of the Guiding Principles on Internal Displacement'. ISIM, The Crisis Migration Project 1–22.

Cohen, R., 2010. Reconciling R2P with IDP Protection, in: Protecting the Displaced: Deepening the Responsibility to Protect. BRILL, Leiden, NL, pp. 15–37.

Cohen, R., 2002. 'Nowhere to run, no place to hide'. Bulletin of the Atomic Scientists 58, 36–45.

Cuénod, J., 1991. Report on Refugees, Displaced Persons and Returnees, Prepared by Mr. Jaques Cuénod, Consultant (No. UN document E/109/Add.1).

Diagne, K., Entwisle, H., 2008. 'UNHCR and the Guiding Principles'. Forced Migration Review 31, 33–35.

Dyke, J., 2015. 'Europe doesn’t have a migrant crisis, it has a Syrian crisis'. IRINnews.

Feller, E., 2006. 'UNHCR’s Role in IDP Protection: Opportunities and Challenges'. Forced Migration Review 11–14.

Ferris, E., 2015. Interview with Elizabeth Ferris, Co-Director of the Brookings-LSE Project on Internal Displacement.

Ferris, E., 2013. 'The Syrian Humanitarian Crisis: Five More Uncomfortable Questions for the International Community'. Brookings Institution-London School of Economics on Internal Displacement.

Ferris, E., 2008. 'Assessing the Impact of the Principles: An Unfinished Task'. Forced Migration Review GP10, 10–11.

Ferris, E., Charny, J., Niels, H., Strohmeyer, H., Zamudio, A., 2015. 'Internal displacement: Lessons learned after 20 years and challenges ahead. Panel 2: What are the principal challenges facing IDPs in the years ahead?', Brookings Institution.

Ferris, E., Mooney, E., Stark, C., 2011. 'From Responsibility to Response: Assessing National Approaches to Internal Displacement', Brookings Institution-London School of Economics Project on Internal Displacement.

Goodwin-Gill, G.S., 2008. 'The Politics of Refugee Protection'. Refugee Survey Quarterly 27, 8–23.

Haddad, E., 2008. The Refugee in International Society: Between Sovereigns. Cambridge University Press.

Hathaway, J.C., 2007. 'Forced Migration Studies: Could We Agree Just to “Date”?' Journal of Refugee Studies 20, 349–369.

Hawkins, D.G., Lake, D.A., Nielson, D.L., Tierney, M.J., 2006. Delegation and Agency in International Organizations. Cambridge University Press.

Hinsley, F.H., 1986. Sovereignty, 2 edition. Cambridge University Press, Cambridge.

Human Rights Watch, 2014. 'Syria: Strong Evidence Government Used Chemicals as a Weapon'. Human Rights Watch. URL https://www.hrw.org/news/2014/05/13/syria-strong-evidence-government-used-chemicals-weapon (accessed 28/08/2015).

Hurrell, A., 2007. On Global Order: Power, Values and the Constitution of International Society. Oxford University Press, Oxford.

IDMC, 2015. 'Global figures'. Internal Displacement Monitoring Centre. URL http://www.internal-displacement.org/global-figures (accessed 14/08/2015).

IDMC, Norwegian Refugee Council, 2015. Global Overview 2015: People internally displaced by conflict and violence. Internal Displacement Monitoring Centre; Norwegian Refugee Council, Geneva.

IRIN network, 2012. 'African convention on internally displaced persons comes into force'. The Guardian.

Islam, M.R., 2006. 'The Sudanese Darfur Crisis and Internally Displaced Persons in International Law: The Least Protection for the Most Vulnerable'. Int J Refugee Law 18, 354–385. doi:10.1093/ijrl/eel012

Kälin, W., 2010. Incorporating the guiding principles on internal displacement into domestic law: issues and challenges, American Society of International Law, Washington, D.C.

Kälin, W., 2008. Guiding Principles on Internal Displacement: Annotations, Studies in Transnational Legal Policy. The American Society of International Law, Washington, D.C.

Krasner, S.D., 2012. Problematic Sovereignty: Contested Rules and Political Possibilities. Columbia University Press.

Krasner, S.D., 2001. 'Sovereignty'. Foreign Policy 20–29. Krasner, S.D., 1999. Sovereignty: Organized Hypocrisy. Princeton University Press,

Chichester, UK. Krasner, S.D. (Ed.), 1983. International Regimes. Cornell University Press, Ithaca, NY.

Loescher, G., 2001. The UNHCR and World Politics: A Perilous Path. Oxford University Press, Oxford.

Martin, S.B., 2015. Interview with Professor Susan B. Martin, Donald G. Herzberg Professor of International Migration Georgetown University.

Minear, L., 1994. Humanitarian Action in the Former Yugoslavia: The UN’s Role, 1991-1993. Thomas J. Watson Institute, Brown University, Providence, RI.

Mooney, E., 2010. 'Something Old, Something New, Something Borrowed ... Something Blue? The Protection Potential of a Marriage of Concepts between R2P and IDP Proteciton', in: Protecting the Displaced: Deepening the Responsibility to Protect. BRILL, Leiden, NL, pp. 15–37.

Morris, T., 2006. 'UNHCR, IDPs and clusters'. Forced Migration Review 25, 54–55. MSF USA, 2015. 'Refugees and IDPs'. Doctors Without Borders. URL

http://www.doctorswithoutborders.org/our-work/humanitarian-issues/refugees-and-idps (accessed 10/08/2015).

Norwegian Refugee Council, 2005. Internal Displacement: of Trends and Developments in 2004. Global IDP Project, Norwegian Refugee Council, Châtelaine (Geneva).

Orchard, P., 2015. 'Refugees and Internally Displaced Persons', in: The Routledge Companion to Humanitarian Action. Routledge, Abingdon, Oxon ; New York, NY.

Pang, Z., 2009. 'China’s Non-Intervention Question'. Global Responsibility to Protect 1, 237–252.

Shukla, K., 2008. 'The international community’s Responsibility to Protect'. Forced Migration Review 30, 7–9.

Syrian Arab Republic, 2014. Letter dated 18 June 2014 from the Permanent Representative of the Syrian Arab Republic to the United Nations addressed to the Secretary-General.

UN, 2004. Guiding Principles on Internal Displacement, 2 edition. UNHCR, 2015a. 'UNHCR warns of dangerous new era in worldwide displacement as report

shows almost 60 million people forced to flee their homes'. UNHCR, 2015b. UNHCR Global Trends 2014: World at War.

UNHCR, 2015c. 'Worldwide displacement hits all-time high as war and persecution increase'. UNHCR, 2014. 'Funding UNHCR’s programmes'. UNHCR Global Report 2014.

UNHCR, 1996. Statute of the Office of the United Nations High Commissioner for Refugees. UN Human Rights Council, 2015. Human Rights Council Resolution A/HRC/29/L.4.

UN Security Council, 2014. Security Council Resolution 2191.

Weiss, T.G., 2015. Interview with Thomas G. Weiss, Presidential Professor of Political Science, The Graduate Center, CUNY.

Weiss, T.G., 2012. What’s Wrong with the United Nations and How to Fix it, Polity Press. ed. Polity, Cambridge, UK ; Malden, MA.

Weiss, T.G., 2003. 'Internal exiles: What next for internally displaced persons?' Third World Quarterly 24, 429–447.

Weiss, T.G., Korn, D.A., 2006. Internal Displacement: Conceptualization and its Consequences, 1 edition. Routledge, Abingdon, Oxon ; New York.

Appendix

Figure 1. Internal displacement worldwide in 2015. Source: IDMC and Norwegian Refugee Council, 2015.

Graph 1. IDPs and refugees from 1989 to 2014. Source: IDMC and Norwegian Refugee Council, 2015.

Figure 2. IDPs protected/assisted by UNHCR, 1995 - 2014.

Source: UNHCR, 2015b.

The Informal Economy: Understanding Variations Between Developed and Developing Economies

David Mee

Abstract The mainstream understanding of the informal economy has shadowed the broader economic and development debates of the last 60 years. Today, the most influential lens through which informality is viewed is that of New Institutional Economics and the ‘good governance agenda’. This view identifies the informal economy as a barrier to the effective enforcement of formal institutions and advocates formalisation in developing economies. Based on a fresh look at available data and by applying political settlement theory, this paper argues that the informal economy is inherent to developing economies and that, even with the best political will, efforts to increase formalisation will remain unsuccessful. Further, it argues that informality can only be reduced as the modern sector expands, aggregate productivity increases and sufficient compensation is provided to those excluded from modern sector employment.

1. Introduction

The notion of ‘employment’ does not map smoothly to the developing world. Developed economies live largely in the world of formal employment: firms are registered, work is remunerated with a wage or salary, workers have bank accounts, labour markets are tightly regulated, taxes are paid to authorities, pensions accrue over time, healthcare is provided, and social security protects workers (Kapsos, 2015:29; Hart, 2006:21). In developing economies only around a third have similar arrangements. The rest live in the world of informal work: firms are unregistered, workers have no contracts, few have bank accounts, labour laws and taxes are evaded, and social security provisions are very basic or non-existent (Ibid). Moreover, in the developed world, national labour force statistics include only those employed in registered firms and the unemployed. In developing economies this definition accounts for only a third of the workforce, the rest, while being part of the labour supply, do not fit the common employment mould and are classified under the term ‘informal economy’.

So, what is the informal economy: How it is defined? What is its nature and characteristics? How can it be tackled effectively? These questions are at the heart of the 60-years-long debate on informality that has shadowed the broader economic and development shift of the period. Today, perhaps, the most influential lens through which informality is viewed is that of New Institutional Economics (“NIE”) and the ‘good governance agenda’. This framework identifies certain institutions as necessary preconditions for efficient markets and growth. Since the informal economy is largely out-of-reach of many formal institutions, is subject to high-levels of corruption and rent-seeking and lacks an effective political voice, it is seen as a barrier to development. The solution is a set of targeted interventions to incentivise formalisation and tighten enforcement with the aim of bringing the hidden economy into the good governance fold. Yet, cross-country empirical evidence and political settlement theory casts doubt on whether these interventions can succeed in the context of developing economies.

By applying a political settlement lens to a dual economy model this paper argues that in most developing economies efforts to enforce formal institutions will be unsuccessful until they achieve higher aggregate productivity. This is because enforcement would result in devastating economic hardship for a traditional sector that employs a large proportion of the workforce. Consequently, enforcement is likely to be strongly resisted, resulting in partial enforcement (the informal economy) or conflict. By contrast, in developed economies enforcement of formal institutions is generally effective. This is because efforts to undermine enforcement can be overcome by a large modern sector that is productive enough to mitigate resistance with tight enforcement capabilities and suitable compensation.

This paper is divided into four sections. The first section discusses the definition and size of the informal economy. The second explores the current consensus on informality by applying NIE and good governance theory. Subsequently, it addresses specific cross-country evidence contradicting some theoretical conclusions. The third section elaborates on NIE theory by introducing the concept of political settlements and applying theory to a two-sector model. The final section provides some concluding remarks.

1.1 Definition And Significance 1.1.1 The informal economy lies beyond the scope of state institutions and oversight

Since the concept was first conceived in the early 1970s, the informal economy has come to be defined and interpreted in a variety of ways: unprotected workers, tax and regulatory

evasion, unfair competition, low productivity, underground economy, illegality (Perry et al, 2007:21). For reasons detailed in the following chapters, his paper aligns itself to definitions of Hart and the ILO. Hart’s definition focuses on the relationship between state regulations and productive units; the relationship is formal where incomes are generated by economic activities regulated by state institutions, and informal where incomes lie beyond the scope of regulation (Hart, 2006:25-26). The ILO generally agrees with this definition and states that informal activities “are outside the framework of regulations either because (a) the enterprises, in which the jobs are located, are too small and/or not registered, or (b) labour legislation does not specifically cover or is not applied… so that the jobs are unprotected by labour legislation.” (Hussmanns, 2004:5-6). The informal sector refers to productive activities that take place in unregistered enterprises; informal employment refers to employment without social or legal protection, both inside and outside the informal sector; informal firms are registered or unregistered firms with informal employees; the informal economy refers to all economic activities, enterprises, jobs and workers operating informally and the output from them (Chen, 2012:6-7).

1.1.2 The informal economy is vast in developing economies

Estimating the size of the informal economy and understanding trends is notoriously difficult. In many countries, particularly developing ones with large informal economies, the capacity for generating statistics is low and labour data that is highly uneven across time and regions. As a result, statistics on informality with around 15 percent error margins are common (Charmes, 2012:108). Nevertheless, there is little doubt of the important role the informal economy plays in developing economies. As figure 1 shows, informal employment is estimated to represents around two thirds of the total workforce and accounts for around a quarter of output. Overall, around two-thirds of those in informal employment are in the informal sector, and a third are in informal employment in formal firms. The latter group comprise mostly household workers, contributing family workers, or workers in micro-firms (Schneider et al., 2010: 31).

Figure'1:'Significance'of'the'informal'economy'in'developing'economies'

b.'Informal'economy'weighted'by'total'GDP,'average'2005Informal)economy)accounts)for)around)a)third)of)total)output.

Source:)Calculation)by)author.)Data:)ILO)and)WIEGO)– Women)and)Men)in)the)Informal)Economy:)A)Statistical)Picture)(2014),)data)fileJ)World)Bank)Data)(2015),)http://data.worldbank.orgJ)Data)by)World)Bank)Q Shadow)Economies)All)over)the)World:)New)Estimates)for)162)Countries)from)1999)to)2007,)data)in)Appendix.

Sample)size:)33)economies Sample)size:)168)economies

0% 25% 50% 75% 100%

Average-across-all-regions*

South-Asia

Sub:Saharan-Africa

East-and-Southeast-Asia

Latin-America

Middle-East-and-North-Africa

Eastern-Europe-(non:EU)-&-Central-Asia

Informal-Employment Formal-Employment0% 25% 50% 75% 100%

Average-across-all-regions*

South-Asia

Sub:Saharan-Africa

East-and-Southeast-Asia

Latin-America

Middle-East-and-North-Africa

Eastern-Europe-(non:EU)-&-Central-Asia

Informal-Economy Formal-Economy

a.'Informal'employment'as'percentage'of'labour force,'average'2004'to'2010Informal)employment)represents)around)for)around)twoQthirds)of)the)total)workforce.

In developed economies, the concept of informality has only recently gained attention and statistical information is limited. The recent focus has centred on the growing use of 'non-standard' employment, defined as arrangements that offer limited benefits and social protection, contractors, part-time and fixed-term employment. Overall, close to a third of employment contracts are 'non-standard'. However, not all workers in non-standard employment arrangements classify as informal; most are covered by social security provisions and labour regulations (Kapsos, 2015:29-31).

1.1.3 Vulnerable employment data provides an inexact, but useful proxy for cross-country comparisons

Cross-country data on informality is limited, the most comprehensive data by the ILO only covers 33 developing economies and the majority lack historical information. Given this limitation, this paper relies on ‘vulnerable employment’ indicators as an inexact but useful proxy for informal employment. Vulnerable employment is an indicator that identifies workers who are less likely to have formal work arrangements and is a summation of own-account workers and contributing family workers. Particularly in developing economies, these two groups are most likely to be associated with informal activities, to have lower wages and are less likely to benefit from social protection (ILO, 2007:14). Indeed, as figure 2 shows, there is a strong linear association between vulnerable employment and informal employment.

There are two important limitations to consider. First, vulnerable employment does not include informal employees in formal firms, employers of informal enterprises and members of informal workers’ cooperatives, as a result, it provides only sub-section of the informal economy. Second, in developed economies most worker in vulnerable employment are covered by social security provisions and regulatory requirements, as such, the indicator is likely to be higher than actual levels of informal employment. However, while the correspondence between vulnerable employment and informal employment is inexact, it can, as the ILO suggest, provide a useful proxy for identifying potential correlations and trends (Ibid).

Vulnerable)employment)data)provides)an)inexact,)but)useful)proxy)for)cross7country)comparisons.

Figure'2:'Informal' jobs'in'total'employment'versus'vulnerable'employment

Source:)Calculation)by)author.)Data:)ILO)and)WIEGO)– Women)and)Men)in)the)Informal)Economy:)A)Statistical)Picture)(2014),)data)fileN)ILO,)World)Employment)and)Social)Outlook)7 Trends)2015,)Datasets.

Sample)size:)33)economies

R²#=#0.5035530%

55%

80%

0% 25% 50% 75% 100%

Share#of#informal#jobs#in#total#employment,#average#

2004#to#2008

%#of#labour#force#in#vulnerable#employment,#average#2004#to#2008

2. Mainstream consensus 2. 1 Theoretical foundations

2.1.1 It is useful to recall how the current understanding of the informal economy has developed over the last half century

The 1950s and 1960s was the period of ‘state-led development’ and Keynesian economics. In developing economies poverty was endemic, urban populations exploding, industrialisation weak, productivity stagnant, unemployment (or underemployment) rising, and inequality widening; the consensus was that only the state could promote growth and development (Hart, 2006:23). Development was primarily understood through the lens of modernisation theories and dualist frameworks, growth in the modern sector was to be achieved by boosting productivity through urban industrialisation, commercialisation of agriculture, and social and attitudinal change based on developed economies’ technology, institutions and value systems. The traditional sector was seen as a barrier to growth and was the target of social interventions, replacing traditional institutions with formal law, free enterprise, democracy, and subjugation to a new class of capitalist elites (Chant & Mcllwaine, 2009:29). Contemporary dualist models left behind dated ideas of social architecture and integrated the latest economic thought (notably: by Harris and Todaro, 1970) bringing the approach into the standard framework of equilibrium economics (Guha-Kasnobis et al., 2006:1). Stagnant or growing rates of informality, defined as the urban-unemployed/ underemployed, were seen as the result of imbalances between growth rates in the modern sector and the population, and a mismatch between labour skills in the traditional sector and those required in the modern sector (Chen, 2012:5-6).

By the 1970s it became apparent that the promised economic growth and poverty reduction had been largely unrealised. Blame for these failures was placed on developing states’ bloated bureaucracies and misguided policies that distorted market forces. The solution, based on the neoclassical paradigm of competitive markets, was the ‘free-market’, freed from over-regulation, trade protectionism, government price-setting, and capital controls. The state should be rolled-back to provide only basic public goods and ensure property rights and the rule of law. It was argued that these conditions would be favourable for entrepreneurs in small and informal enterprises which, operating without regulation and in near-perfect competition, were seen as an engine of growth and dynamism (Barwa, 1995:1-2). The timely study of De Soto (1989) was highly influential in embedding this narrative. His main argument was that informality was a reaction to burdensome government regulations and ineffective property rights that dissuade informal firms from formalising, thus, blocking access to capital necessary to improve productivity and expand (Erickson, 2002:3).

In the 1980s, countries stricken by debt crisis had free-market policies summarily mandated under Structural Adjustment Programmes (“SAPs”). World Bank and IMF studies projected high productivity gains and significant modern sector employment growth, instead, the tight fiscal policies and the reduction in formal government jobs depressed real wages, demand and growth. The informal sector expanded, credit became increasingly inaccessible, the prices of raw materials and equipment increased, productivity declined and poverty rose (Barwa, 1995:33-34).

By the 1990s, the unequivocal failure of SAPs drew widespread criticism and led to the emergence of a new role for the state: establishing the conditions necessary for effective and efficient markets. The development of New Institutional Economics provided the theoretical foundations that identified institutional arrangement as the primary source of growth and

development. Under the moniker of ‘good governance’, theory was converted into a set of development policies, identifying certain state capabilities and institutions as necessary pre-conditions for growth (Khan, 2008:110-111; and World Bank, 1997:1-15). This new consensus continued to build on the earlier commitment to the ‘free-market’, liberalisation, and de-regulation, albeit with a focus on institutions and capabilities (Craig and Porter, 1997:98). A key implication is that, since the informal economy is neither controlled nor has access to many institutions regarded as preconditions for growth, high levels of informality directly hamper development.

2.1.2 Most economists and development practitioners agree that productivity is the main determinant of growth, development, and creation of quality formal jobs

Productivity growth increases capital accumulation by lowering production costs and increasing returns on investment. Some of the capital can then be reinvested to expand markets, improve product or process innovation, and acquire new technology, which further expands output growth and productivity. Capital can also be channelled into more employment and higher wages stimulating consumption and demand. As production and consumption patterns change work is reorganised driving the division of labour, specialisation and demand for increasingly advanced skill sets. Investment in human capital then increases creating higher quality formal jobs and further boosting productivity (ILO, 2008:2-3). Indeed, as figure 3.a shows, higher aggregate productivity is strongly associated with lower rates of informality. Moreover, figure 3.b illustrates how higher productivity growth is associated with a faster reduction in informality.

2.1.3 More controversially the current consensus also reverses causality

The productivity-informality correlation is explained as informality inhibiting productivity growth. The purported explanations by which these mechanisms occur are manifold, however, the argument is grounded on NIE theoretical foundation and the ‘good governance’ narrative.

NIE introduces two concepts: institutions and transaction costs. Institutions are the rules and norms that define social interactions between actors: market, political, and social (summary in

Figure'3:'Informality' versus'productivity

a.'Informality'versus'productivityData$indicates$a$very$strong$correlation$between$informality$and$productivity.

b.'Fall'in'informality'versus'rise'in'productivityThe$top$25$per$cent$of$economies$with$fastest$productivity$growth$saw$and$annual$decrease$in$informality$of$0.45$percent,$while$the$bottom$25$percent$only$0.07$per$cent.

Source:$Calculation$by$author.$Data:$ILO,$World$Employment$and$Social$Outlook$I Trends$2015,$Datasets.

R²#=#0.83091$1,000#

$10,000#

$100,000#

$1,000,000#

0% 25% 50% 75% 100%

Output#per#worker#(USD),#average#1991#to#2013,#

PPP#adjusted

%#of#labour#force#in#vulnerable#employment#,#average#1991#to#2013

Advanced Developing EmergingSample$size:$166$economies Sample$size:$166$economies

R²#=#0.16446!5%

0%

5%

10%

!2% !1% 0% 1%

Annual,growth,in,output,per,worker,(USD),,average,

1991,to,2013,,PPP,adjusted

Annual,growth,in,%,of,labour,force,in,vulnerable,employment,,average,1991,to,2013

Advanced Developing Emerging

figure 4). They offer different choices, incentives and constraints, thus shaping potential outcomes. The facilitating role of institutions is often described in terms of transaction costs, defined as the cost of finding a person with which to carry out an exchange, agreeing a price, and agreeing a contract to exchange property rights. Further, for the exchange and contracts to be credible, enforcement capabilities are required bearing additional ‘enforcement costs’. The concept of transaction costs can then be applied to the analysis of any collective action to determine whether an exchange can be carried out at a reasonable cost. Under certain institutional arrangements transaction costs can be so significant (inefficient) as to greatly reduce the benefits of an exchange or even make whole activity too costly to be viable. Conversely, other institutional arrangements can enhance benefits by reducing transaction costs (efficient) (North, 1990:6-9).

Institutions are formal if they are written down by state laws or regulations and are enforced by state agencies, for example, the police, prosecutors, regulators, or courts. Generally, these institutions are impersonal, they are specified without naming individuals and apply equally to all groups with the same general characteristics. Formal institutions are the main levers by which government policy can be implemented since only these are defined by states and within the scope of government enforcement agencies. On the other hand, informal institutions are not written down, are not officially enforced by state agencies and are generally personal. They are patterns of behaviour and norms that often overlap with formal rules. They can also refer to rules which are not written down but are enforced unofficially by third parties, including the state, through, for example, rent-seeking and corruption. Informal institutions can affect the cost of enforcing formal institutions, the impact can be positive or negative depending on whether their effect is to respect or challenge rules (Khan, 2010:8-9; North, 1990:40-50).

In theory, if formal institutions are inefficient, changes should be demanded and negotiated through the political process. These ‘higher-level’ political institutions provide the rules for changing ‘lower-level’ formal institutions. Yet, in many countries, particularly developing ones, inefficient institutions are remarkably enduring. One explanation is that ‘political transaction costs’, defined as the cost of negotiating and enforcing changes to formal institutions, are high in comparison to the gains achieved by changing relevant institutions. Thus, inefficient political institutions can slow or stop the evolution to more efficient lower-level institutions and perpetuate poor performance (Khan, 2010:14-15, North, 1990:130-142).

NIE economists argue that growth and development is not an inevitable, but gradual, process. Instead, the process is shaped by a country’s institutional arrangements which, by determining transaction costs, dictate how and whether exchanges between different agents occur (North, 1990:6-12). Growth and development can only occur if formal and political institutions provide low transactions costs, are impersonal, reduce free-riding, facilitate capital accumulation and capital mobility, allow pricing and sharing of risk, and encourage cooperation (Ahrens, 1998:10). Informal institutions are also important by affecting the cost of enforcing formal institutions. Further, it cannot be assumed that efficient institutions will automatically come into existence, experience indicates that institutions that promote growth and welfare are rare (Ibid.).

From this theoretical basis came a new development consensus: the failure of previous market-orientated development policies was caused by an over-withdrawal of the state that, paradoxically, is required to embed efficient institutions. A ‘capable state’ is required to (continue to) implement market-orientated reforms, address markets failures, improve the provision of pure public goods, manage externalities, and provide effective social security (World Bank, 1997:4). A pre-condition for this capable state are a set of ‘good governance’ institutions based on the blueprint of advanced ‘liberal’ states. While many definitions exist, the annually published World Bank Governance Indicators (“WBGI”) provide perhaps the most influential definitions (Kauffman, 2015:http://info.worldbank.org). These, this report suggests, can be separated into two groups:

The first set of indicators measure the extent to which countries’ formal, informal, and political institutions align to those defined by the WBGI. These include:

§ Rule of law (formal institutions) – quality of contract enforcement, property rights, the police, and the courts, as well as the likelihood of crime and violence;

§ Voice and accountability (political institutions) – strong democracy, freedom of expression, freedom of association, and a free media;

§ Control of corruption (informal institutions) – low levels of rent-seeking and corruption.

Figure 4: NIE institutional system

Informal institutionsRule and norms that are not

written down in laws or regulations and not officially enforced by state agencies

Political institutionsSystem of political structures, norms and rules for changing ‘lower level’ formal institutions

and rules

Formal institutionsRules and norms that are written down in laws or regulations and

enforced by state agencies

Growth Outcomes

Transaction costsRules that can be enforced with low costs could reduce

transaction costs

Political transaction costsCost of negotiating changes

to formal institutions and rules

Performance feedbackEfficiency of institutions informs political process

Performance feedbackEfficiency of institutions

informs rule design

Absence or weakness of informal institutions may impact transaction costs

Source: Author, with input from Khan (2010)

The second set measures the performance of institutions and government capabilities, specified in terms of expected outcomes defined by the WBGI. These include:

§ Political stability and absence of violence – likelihood of government destabilization by unconstitutional or violent means, including politically-motivated violence and terrorism;

§ Government effectiveness – quality of service delivery and the degree of independence from political pressures;

§ Regulatory quality – ability to formulate and implement market-enhancing policies and regulations.

Implementing these institutions should, according to the consensus, set the necessary foundations for maintaining efficient markets, with low transaction costs and a democratic and participatory systems that continually improve institutions.

2.1.5 The size and nature of the informal economy presents a significant challenge in implementing good governance policies

By being unregistered and operating outside of regulations the informal economy is excluded from many formal institutions and will instead operate under norms informed by local practices, often in competition or conflict with formal rules. For instance, the diversified firms (construction, trade, transport, money-lenders) that emerge in illegal settlements in many developing economies. These firms follow local norms that dictate how contracts are negotiated and enforced and how private and common land is administered (Marquez, 1990:209-210). However, operating by a different sets of rules undermines formal laws. In these cases, formal institutions may be less credible than informal ones (Sindzingre, 2006:67-68). Thus, theory would suggest that higher rates of informality should be associated with decreasing confidence in formal institutions. Indeed, as figure 5 shows, theory plays out in practice; as informality increases perceptions of the extent to which agents have confidence in the rule of law (defined as quality of contract enforcement, property rights, the police and the courts) falls.

Higher'levels'of'informality'are'strongly'associated'with'falling'confidence'in'formal'institutions.''

Figure'5:'Informality' versus'rule'of'law

Source:'Calculation'by'author.'Data:'ILO,'World'Employment'and'Social'Outlook'D Trends'2015,'DatasetsJ'World'Bank'D The'Worldwide'Governance'Indicators'2014

Sample'size:'166'economies

R²#=#0.55277*2.5

*1.5

*0.5

0.5

1.5

2.5

0% 25% 50% 75% 100%

Rule#of#law#index,#average#2000#to#2013

%#of#labour#force#in#vulnerable#employment,#average#2000#to#2013

Advanced Developing Emerging

The rule law index reflects perceptions of the extent to which agentshave confidence in and abide by the rules of society, and in particularthe quality of contract enforcement, property rights, the police, and thecourts, as well as the likelihood of crime and violence.

Since good governance institutions represent the supposed pre-conditions for growth, it takes a small logical step to conclude that high levels of informality will have an adverse effect. The mechanisms by which informality is purported to hamper growth are manifold, however, they can generally be grouped into two categories. First, regulations impede firms from formalising resulting in exclusion from formal institutions (credit, infrastructure, banking services) and an inability to expand production and exploit economies of scale (Müller-Falcke, 1997:1). Second, informal firms may compete with their more productive formal peers by avoiding taxes and regulations, slowing down the ‘creative destruction’ process (Perry at al., 2007:170-173; Farrell; 2004:27-28). This logic would then support the view that formalising the informal economy will increase productivity growth.

2.2 Limitations in mainstream theory

2.2.1 Despite the widespread consensus, cross-country comparisons do not find a robust causality between informality and productivity growth

While there is a strong correlation between informality and aggregate productivity (see figure 3), evidence in figure 6 suggests that the informality has little to no impact on productivity growth.

There are, of course, limitations to this analysis. Factors impacting growth and development are manifold (including, education, external debt, macroeconomic stability, aid effectiveness, credit supply, healthcare, political stability, starting GDP per capita) the fact that we do not observe a large effect of informality on productivity growth may just reflect the crude analysis’ inability to distinguish between these (World Bank, 2015:data.worldbank.org). Other studies (notably Perry et al., (2007)), contradicting these findings, show that informality appears to have a negative impact on growth. However, they also conclude that “the estimated coefficients tend not to be robust… the relationship looses significance when we control for education, financial depth, or corruption… [findings rely] on a very narrow pool of observation” (Perry at al., 2007:173). On the other hand, the large number of countries sampled in figure 6 should, at least, cast doubts on the current consensus.

Cross%country+comparison+does+not+find+a+robust+causality+between+informality+and+productivity+growth.

Figure'6:'Informality' versus'productivity'growth

Source:+Calculation+by+author.+Data:+ILO,+World+Employment+and+Social+Outlook+% Trends+2015,+DatasetsI+World+Bank+% The+Worldwide+Governance+Indicators+2014

Sample+size:+166+economies

R²#=#0.00023)5%

0%

5%

10%

15%

20%

0% 25% 50% 75% 100%

Annual#growth#in#output#per#worker#(USD),#average#

1991#to#2013,#PPP#adjusted

%#of#labour#force#in#vulnerable#employment,#average#1991#to#2013

Advanced Developing Emerging

It could also be argued that good governance theory challenges this conclusion. As figure 5 illustrates, informality has a clear negative impact on the enforcement and credibility of formal institutions. However, theory dictates that political and informal institutions are also pre-conditions for growth. Countries with higher levels of informality are also associated with lower perceptions of political and informal institutions (Kauffman, 2015: http://info.worldbank.org). Inefficient political institutions, those lacking voice and accountability, could have such high political transaction costs that inefficient lower-level institutions remain and/or are not effectively enforced. Informal institutions, with high level of rent-seeking and corruption, could raise transaction costs to the extent that the market is inefficient.

Yet, behind this challenge lies the assumption that the good governance political and informal institutions are indeed pre-conditions for growth. While, as figure 7 shows, countries with favourable perceptions of political institutions and low corruption tend to be more developed, these institutions have little or no discernible impact on average productivity growth (however, they are associated with convergence).

The role of institutions in enabling efficient markets and stimulating growth is not in question, more efficient markets will likely accelerate the effective allocation of resources and lead to faster growth. The question is whether, in light of this and more comprehensive studies (notably: Khan (2008)), market efficiency in developing economies can be maximised, and if this maximisation is sufficient for ‘catch-up’ growth and development. Addressing this topic in detail is beyond the scope of this paper, however, some economists argue (Ibid.) that developing economies have inherently inefficient markets that will remain low until a certain degree of productivity is achieved. Given these limitations, accelerating growth and development requires countries to first develop institutions and capabilities that specifically deal with the problems faced by catching-up economies (for example, dualistic economies, unstable property rights, technological acquisition, human capital development, political instability). In sum, empirical evidence showing no productivity growth effects of informality cannot be ‘explained away’ by poorly performing political or informal institutions.

Figure'7:'Productivity'growth'versus'perceptions'of'political'and'informal' institutions

a.'Productivity'versus'voice'and'accountability'indexPerformance*against*political*institutions*is*not*strongly*associated*with*productivity*growth.*

b.'Productivity'versus'corruption'indexPerformance*against*informal*institutions*is*not*strongly*associated*with*productivity*growth.*

R²#=#0.0136*5%

0%

5%

10%

15%

*2.5 *1.5 *0.5 0.5 1.5 2.5

Annual#growth#in#output#per#worker#(USD),#average#

1996#to#2013,#PPP#adjusted

Voice#and#accountability#index,#average#1996#to#2013

Advanced Developing Emerging

R²#=#0.03164+10%

+5%

0%

5%

10%

15%

+2.5 +1.5 +0.5 0.5 1.5 2.5

Annual#growth#in#output#per#worker#(USD),#average#

1996#to#2013,#PPP#adjusted

Corruption#index,#average#1996#to#2013

Advanced Developing EmergingSample*size:*166*economiesSample*size:*166*economies

Source:*Calculation*by*author.*Data:*ILO,*World*Employment*and*Social*Outlook*G Trends*2015,*DatasetsL*World*Bank*G The*Worldwide*Governance*Indicators*2014

The voice and accountability index reflects perceptions of the extent towhich a country's citizens are able to participate in selecting theirgovernment, as well as freedom of expression, freedom of association,and a free media.

The corruption index reflects perceptions of the extent to which publicpower is exercised for private gain, including both petty and grandforms of corruption, as well as "capture" of the state by elites andprivate interests.

2.2.2 Regulatory quality has little impact on the size of the informal economy

Other economists may argue that the reason that informality has little to no impact on productivity growth is because government policy shuts-out informal entrepreneurs and prevents them from contributing to formal growth. If the vast pool of untapped informal resources and entrepreneurial capabilities were unleashed faster growth would follow (Marquez, 1990:204-207).

The influential studies by De Soto (1989, 2000) define the problem as one of capital production. In the formal economy, where capitalism ‘works’, effective property rights enable firms to exploit their assets to generate investment capital (credit, shares, bonds). By contrast, informal firms have no formal property rights, their assets and business operations are essentially invisible to the formal world. While it is clear that informal firms have processions and generate profits, they are unable to use these to generate capital and invest in production (technology, infrastructure, human capital) (De Soto, 2000:1-7). Instead, when firms need capital their only resource is the network of people with whom they have established a relationship of trust. Were their assets protected by formal property rights, these could be used to generate capital from wider networks (De Soto, 2000:49-50). However, this inability to generate capital stock is not just caused by ineffective property rights, the problem is the entire process of converting assets into capital caused by a legal infrastructure that’s inadequate for smaller firms. In practical terms, adequate legal infrastructures have come to be interpreted as regulations that reduce transactions costs, particularly associated with efficient business registration and administration (Molen, 2012:3-5).

In support of this argument, a number of studies have identified that ‘poor’ regulations are associated with an increase in the size of the informal economy. Research by Loayza et al., (2006) suggests that “an increase in either product-market or labour regulation leads to an expansion of informality… this pernicious effect is gradually mitigated as governance – and thus regulatory quality – improves.” (Loayza et al., (2006:142). Corroborating this correlation, figure 8 finds that more ‘business friendly’ regulatory environments are strongly associated with lower levels of informality.

Another important observation is that developed economies generally have far higher regulatory quality than developing ones. As previously established, the higher productivity of more developed economies leads to lower levels of informality, this raises an important question: to what extent are different levels of informality the result of better regulations rather than differences in productivity? Both Loayza et al., (2006) and figure 8 do not control for existing productivity levels, this is methodologically problematic as their effects cannot be disaggregated. One way to address this issue is to observe how regulation affects changing rates of informality for economies with similar rates of development (thus productivity). It would generally be expected, following the argument by De Soto, that more business friendly regulatory environments would (by reducing transaction costs) incentivise new firms to start formally and existing informal firms to formalise, resulting in a gradual decrease in the percentage of employees working informally. However, as figure 9 illustrates, for the admittedly limited years data is available, there is no significant association between regulatory quality and growth in informality.

Higher'quality'of'regulations'is'associated'with'higher'productivity.

Figure'8:'Informality' versus'regulatory'quality

Source:'Calculation'by'author.'Data:'ILO,'World'Employment'and'Social'Outlook'E Trends'2015,'DatasetsK'World'Bank'– Doing'Business'Indicators'2014,'Datasets.

Sample'size:'160'economies

R²#=#0.4811820

40

60

80

100

0 25 50 75 100

Distance#to#to#frontier#score,#average#2010#to#2013

%#of#labour#force#in#vulnerable#employment,#average#2010#to#2013Advanced Developing Emerging

The distance to frontier score measures the distance of each economyto the “frontier,” which represents the economy with the ‘best’ regulatoryenvironment for doing business. An economy’s distance to frontier isreflected on a scale from 0 to 100, where 0 represents the lowestperformance and 100 represents the frontier.

The argument that the high transaction costs associated with poor regulations present a barrier to formalisation is not in question. In many countries the cost of registering a business is many times the average yearly income which clearly makes registration unviable for the average informal firm (World Bank, 2005:doingbusiness.org). It is equally clear that financing presents the greatest perceived obstacle for most informal firms; on average over 40 percent of informal entrepreneurs report that access to finance is their biggest obstacle, twice the number reported by formal firms (La Porta et al. 2014:116). However, registering firms and providing them with property rights may not improve the situation. Most informal firms do not have the basic controls, business plans or bank accounts required for private financing (Ibid). Moreover, even if special financing was available to newly formalised firms, there is ample reason to be sceptical of their ability to compete in the formal sector.

The majority of informal firms are too small and unproductive to overcome the various costs of formalisation. Around half have no employees and their clients are typically their small network of personal contacts (Perry et al. 2007:145). As a result, their ability to exploit economies of scale by investing in productivity may be limited. There is, of course, the argument that firms can expand production by accessing larger markets. However, because of the dual nature of the economy, firms generally operate in industries where larger players, with established economies of scale and more advanced technology, human capital and operations (logistics, sales, marketing, consumer credit, large product ranges) already exist. In these cases, it is unlikely that, without the benefits tax and regulatory evasion, firms would remain competitive (Perry at al., 2007:9-10). With this in mind, informal firms may wisely choose to stay under the radar or resist enforcement efforts.

2.2.3 A subsequent concern focuses on how informal competition may inhibit the ‘creative destruction’ process

Creative destruction refers to the incessant product and process innovation by which high-productivity firms expand to the detriment of their less productive peers. This continual shift of resources to more innovative and technologically advanced production units reorganises industries and drives productivity growth. When compared with their formal peers, informal firms are unproductive, inefficient, and outdated. They can, however, remain competitive through price advantages gained by avoiding taxes, regulations and buying inputs from

Analysis(does(not(find(a(robust(causality(between(informal(regulatory(quality(and(growth(in(informality.

Figure'9:'Growth'in'informality'versus'regulatory'quality

Source:(Calculation(by(author.(Data:(ILO,(World(Employment(and(Social(Outlook(D Trends(2015,(DatasetsJ(World(Bank(– Doing(Business(Indicators(2014,(Datasets.

Sample(size:(160(economies

R²#=#0.0252120

45

70

95

-2 -1 0 1 2

Distance#to#to#frontier#score,#average#2010#to#2013

Annual#growth#in#%#of#labour#force#in#vulnerable#employment,#average#2010#to#2013

Advanced Developing Emerging

informal suppliers (Farell, 2004:31-32). Thus, less productive firms stay in business and slow the transition of resources to higher productivity firms and sectors (Perry at al., 2007:171). The logical corollary is that better regulatory enforcement would catalyse the creative destruction process and result in higher productivity growth.

One caveat to this argument, however, is the assumption that any adjustment process will be short-lived and full employment of resources (shifted to the formal economy) would fast return. In reality, anaemic growth in modern firms has a multitude of causes – including: learning barriers, poor infrastructure, ineffective trade and industrial policies, macroeconomic instability, inequality – the idea that growth would surge if regulations were better enforced appears quixotic. In practice, tighter enforcement is likely to destroy unproductive informal employment at a much faster rate than it generates high-productivity formal employment. Thus, the result would not be a shift of resources from lower to higher productivity firms, but, for many, to more underground informality or unemployment. Indeed, a number of studies (notably: Alemeida and Caneriro, 2005; Scarpetta and Tressel, 2004) have suggested that lower levels of informality resulting from tighter regulatory enforcement are associated with a decrease in labour productivity and higher labour adjustment costs.

3. Structural drivers shaping the informal economy 3.1 Theoretical foundations 3.1.1 The mainstream consensus ignores the role of political settlements in determining the performance of institutions

The good governance agenda, and its theoretical forbearer NIE, primarily focus on the role of institutions in defining incentives. If institutions are only incentive structures it should be possible to design them with the right carrots and sticks necessary to encourage formalisation and deter informality, irrespective of existing levels of productivity (Di John and Putzel, 2009:7). Yet, cross-country evidence shows that, even with the best political will, economies only successfully increase formality when matched with growth in productivity (see figure 3). One explanation is that good governance and NIE overlook role of institutions in distributing net benefits and the resistance by powerful groups to changes that may be against their interests (summary in figure 10).

Institutions influence potential outcomes and can reduce transaction and enforcement costs. At the same time, institutions also generate economic benefit and define rules for distributing those benefits amongst different groups (Khan, 2010:18-19). For example, “reengineering” rules to encourage formalisation through “a good balance of carrots (reforms and actions to facilitate, reduce the costs, and increase the benefits of formalization) and sticks (enhanced, even handed enforcement of such improved laws and regulations)” could be funded and delivered in many ways (Perry et al., 2007:14). One approach could focus on expanding access to social protection, funded through progressive general taxation that provides allowances for small firms. Another approach could focus on tightening enforcement and mandating that firms provide additional benefits to employees through private arrangements. Assuming effective implementation and enforcement, each would imply different transaction costs amongst employees, firms and government. Equally important, each option implies a fundamentally different distribution of benefits across impacted groups. The first approach could see small firms achieve net benefit gains (if additional benefits outweigh costs of taxes and regularly compliance) funded by increased costs to larger firms, while the in second,

small firms would face the same tax and regulatory burden as large firms resulting in a net benefit gain for larger firms (if gains from improved competition outweigh costs of additional benefit provisions). This distributive role can help to explain why similar institutions face such different enforcement costs in different societies. To understand its impact three factors need to be considered: how different groups will be impacted, the distribution of power between impacted groups, and state enforcement capabilities.

New institutional rules create winners and losers, some groups gain relative benefits, while other incur loses. Who the impacted groups are will depend on how specified rule changes explicitly or implicitly discriminate between people with common characteristics (for instance, firm size, employment status, industry, locality, gender, class, ethnicity, race). These groups will react by either supporting, condoning, contesting, obstructing or opposing rules based on the costs and benefits associated with changes. Transaction costs of enforcement are likely to be lower if rule changes are supported and higher if they are opposed.

Enforcement costs will also vary based on the distribution of relative power between different groups, the ‘internal power structure’. Groups with higher relative power are those with greater capabilities to sustain themselves for longer in conflict, that can inflict higher costs on adversaries, and that can mobilise and sustain support to absorb costs. In a conflict between different groups the outcome should be determined by the ‘relative distribution of power’ between different groups (Khan, 2010:20). Assuming people are rational, they will seek to maximise benefits or minimise their losses. Thus, if the distribution of benefits is inconsistent with the distribution of power – in other words, if changes shift benefits to the extent that institutions no longer provide different groups with maximum attainable gains – rules are likely to face strong resistance though, for example, attempting to change them through the legal process, evasion, or engaging in conflict (Khan, 2010:23). The additional enforcement cost incurred will depend on the intensity and strategy of resistance. Effort required to overcome this resistance will also depend on enforcement capabilities of relevant agencies (resources, incentives available, internal processes, and quality of infrastructure). States with more capable agencies and greater control over their populations can enforce changes at a lower cost.

Stable institutional systems that are compatible and sustainable with a society’s internal power structure and generate a minimum level of economic and political viability are described as a ‘social order’ or ‘political settlement’ (Khan, 2010:20). States with effective social orders avoid conflict and instability through formal, informal and political ‘institutional systems’ that distribute benefits compatible with the relative power of different groups in society. Violence and conflict are unnecessary as each group already receives the maximum share of benefits they could obtain through other means. Stable systems also require economic viability, otherwise the distribution of benefits becomes unsustainable and the system collapses. By contrast, states without an effective social order are marred with unstable institutions and, often, civil conflict and violence as groups use their power to secure a new system that provides them with the maximum attainable economic and political gains. Once a new stable system can redistribute benefits without conflict, a new political settlement is achieved (Khan, 2010:21).

The minimum level of political and economic stability that a particular society can tolerate will vary significantly across different societies and will evolve over time. However, at any given time societies have a maximum level of political conflict they can withstand, above this threshold the social order becomes unsustainable and credibility in institutions collapses. Similarly, there is a level of economic hardship below which enforcement of institutions

becomes unsustainable and conflict is likely to occur (Ibid). These minimum levels also vary across different groups within societies. More powerful groups with greater capacity to change institutional systems are likely to have a lower tolerance to losses and will start mobilising their power to change systems at an earlier time. Less powerful groups, who do not have the same capacity, are likely to tolerate much greater hardship (Khan, 2010:21).

The mainstream consensus on informality, based on the good governance agenda and NIE, ignores the role of political settlements in determining the performance of institutions. In doing so, it assumes that institutions and rules that reduce transaction costs and incentivise formality in one context can be ‘lifted and shifted’ to completely different contexts to produce the same results. In practice the results can significantly vary depending on how the distribution of benefits interacts with the existing political settlement. In some cases, institutional changes may be accepted or met with limited resistance, here enforcement and transaction costs are likely to remain low. In others, resistance may be so high as to increase transaction costs beyond the point of viability or result in partial enforcement or conflict (Khan, 22:2010).

3.2 Political settlement analysis

3.2.1 Developing economies are transitional societies, where a modern sector coexists with a traditional one

Development implies a fundamental transformation of society, a radical shift from traditional methods of production, traditional employment relationships, and traditional institutions to more ‘modern ways’ (Stiglitz, 1998:3). Successful transformations require economies to constantly generate new dynamic methods of production with higher productivity and increasing returns to scale. In the primary sector, agriculture shifts from subsistence-orientated to specialised production orientated towards national and international markets. This process adopts new production technologies (machinery, fertilizer, high-yield crops) raising production and productivity. Growth in the primary sector and strategic integration into international markets stimulate demand and growth in manufacturing. This sector is

Figure'10:'The'impact'of'benefit'distribution'on'transaction'costs

Potential'change'in'distribution'of'benefitsChanging'rules'implies'a'change'in'the'distribution'of'benefits'amongst'impacted'

groups

Institutional'changeRule'changes'or'change'in'enforcement'strategies

Source:'Author,'with'input'from'Khan'(2010)

Transaction'costsEnforcement'costs'will'depend'on'institutional'design'and$on'the'compatibility'between'the'distribution'of'benefits'and'the'

distribution'of'power'

Impacted'groupsChanges'in'rules'discriminate'against'groups'with'common'

characteristics

Distribution'of'powerImpacted'groups'have'different'relative'power'which'can'be'used'to'support'or'resist'

changes'based'on'assessment'of'costs'and'benefits

Effect'on'institutional'systemIf'transaction'costs'are'sufficiently'low'they'

may'be'sustained'within'the'political'settlement,'however,'if'transaction'costs'are'high'the'political'settlement'may'

become'unviable

Theoretical'effect'of'institutional'change

characterised by much higher returns to scale, capital accumulation, specialisation, technical progress (process and product innovation), and increasing demand for a wide range of other non-manufacturing services. Over time the secondary and tertiary sectors, burgeoned by increasing trade, become the main contributors to growth in productivity, capital stock and economic output (Rada and Taylor, 2006:3-10). Employment follows a similar trajectory, higher agricultural productivity along with limited elasticity of demand results in declining agricultural employment. Instead, employment growth becomes dominated by the secondary and tertiary sectors, where output per capita grows faster than the sectors’ rising productivity. Here, employment is increasingly formal, specialised, demands increasingly advanced skills, and provides higher incomes (ILO, 2008:5).

These structural changes also require new institutions able to facilitate increasingly complex methods of production and exchange. Exchanges in traditional societies generally occur between the small network of trusted contacts (small-community trade), enforcement is generally personal and the costs of transacting is very low. As markets expand, intimate knowledge of clients becomes increasingly impractical and personal ties, voluntary constraints and ostracism are no longer efficient. Growth in manufacturing and capital markets call for exchanges that are so complex and involve such huge amounts of capital as to be precluded without the means to effectively enforce contracts across time and space. These transactions require institutions that enable increasingly impersonal and complex exchanges without the need for personalised contracting and enforcement, effectively, laws that define contracts, property rights and governance agencies to ensure their enforcement. As the economy becomes increasingly specialised, nationally and through the international division of labour, resources engaged in the transaction sector (finance, banking, professional services, judges, police) become paramount (North, 1990:119-122).

To be sure, in the last half century only a handful of economies (‘East Asian miracles’) have successfully transformed in this manner and joined the developed economies ‘club’, and only a few others (China perhaps the most prominent example) appear to be following in similar footsteps. The rest have generally failed to accelerate the pace of structural change: the importance of manufacturing has stagnated or fallen, growth in productivity and output remains anaemic, poverty stubbornly high, and the gap between the rich and poor continues to rise (Rada and Taylor, 2006:4). Thus, while all developing economies are located somewhere along this transformation journey, only a relatively small number are moving at sufficient pace and in the right direction. Moreover, this stylised unilinear view fails to capture the blended nature of societies. Transformation does not occur in unison, even in developed economies there are sectors and regions that remain wedded to traditional methods of production and traditional institutions. However, while in developed economies these are small, in developing ones they often predominate. As a result, developing economies are dualistic, with a competitive a ‘modern sector’ adopting advanced methods of production co-existing with a stagnant ‘traditional sector’ that still uses dated technology and processes (Stiglitz, 1998:4-5). Indeed, studies by McKinsey and the World Bank identify how, in developing economies, the productivity of large modern firms continue to rise as they modernise and acquire new technology, while in traditional ones, productivity is usually stagnant or falling (Bolio et al., 2014:2-6; Salioa, 2011:5-7).

By applying the political settlement framework to the dual-sector model, this paper argues that the location of an economy on the transformation journey, measured by productivity and size of each sector, is a primary factor in determining whether the distribution of benefits by formal institutions is compatible with the distribution of power.

3.2.2 Formal institutions result in benefit gains for the modern sector, but losses for the traditional one

The distribution of benefits by formal institutions are likely to results in gains for modern sector entrepreneurs, employees, and political organisations. For entrepreneurs, market-enhancing institutions are necessary to facilitate increasingly complex exchanges; contract enforcement, property rights, governance agencies and financial services lower transaction costs and provide the foundations with which entrepreneurs can generate capital, grow their business and increase profits. For employees, gains come from higher wages, better working conditions, improved benefits and better career development opportunities. For political organisation, gains come from rising corporate and income taxes which provide them with the fiscal resources to deliver more expensive policies, strengthening the interdependence between political organisations and entrepreneurs. Thus, while specific rules are likely to face continual contestation through the political process, it is reasonable to assume that formal institutions will be accepted with relatively low enforcement costs by those affiliated with the modern sector.

For the ‘traditional sector’, the distribution of benefits by formal institutions is likely to result in devastating losses and hardship for entrepreneurs, employees, and customers. As section 2.2.2 discussed, structural impediments prevent the vast majority of traditional firms from expanding production and modernising. Here, operations are typically stagnant and characterised by limited capital stock, small markets, contracts that are personal and simple, exchanges of limited value, and personal enforcement (Hart, 2006:21-22). Formal institutions that enable impersonal and complex exchanges, however well designed, are unlikely to significantly lower transaction costs, instead, the additional layers of administrative complexity are likely increase costs. Of even greater concern, the additional tax and regulatory burden increases prices, lowers demand and/or makes them uncompetitive vis-à-vis more modern firms. As a result, imposition of formal institutions is likely to face very strong resistance and high enforcement costs.

3.2.3 Compensation can reduce enforcement costs, but this strategy is likely to face strong resistance until a certain level of aggregate productivity is reached

It is, in theory, possible to reduce enforcement costs by compensating the traditional sector for its losses. If adopting institutional changes increases aggregate productivity and output, net benefit gainers could compensate losers so that institutions are beneficial for all. For this to be possible, political transaction costs for negotiating compensations need to be lower than output gained (North, 1990:107-111). Indeed, policy recommendations that advocate “strengthening enforcement” while “reengineering social protection to cover all citizens” are best understood in this context (Perry et al, 2007:16); while formal institutions will result in benefit losses for traditional firms, growth in the economy should make it feasible to compensate them with benefits that enhance living standards.

There are some caveats to this argument. First, for compensation to be arithmetically possible, institutional changes need to generate sufficient productivity growth to overcome political transaction costs. However, as section 2.2.1 demonstrated, there is little evidence that attempting to maximise market-enhancing institutions will, on its own, significantly increase growth in developing economies. Second, as section 2.2.3 argued, the adjustment process is likely to be protracted resulting in, assuming effective enforcement, unemployment. Thus, compensation would require effective unemployment insurance and other forms of social protection, likely far beyond the fiscal resources of most developing economies (Chant,

2001:200-201). Third, negotiating costly compensation on the promise of potential long-term growth is likely to face strong resistance, thus high political transaction costs, from the (wisely) sceptical modern sector whose performance is measured in short-term profits.

These caveats would suggest that compensation strategies are likely only be feasible when four conditions are met. First, those in power believe that an economy predominated by formal institutions is economically and socially superior. Second, compensation can be financed through strategies bearing low political transaction costs, typically without significant tax increases. Third, those incurring losses are willing to accept compensation, if they perceive they have the power to hold out compensation may be insufficient. Fourth, compensation will lower resistance and enforcement costs so that efficiency of exchanges can maintain a minimum level of economic viability.

3.2.4 The distribution of power with regards enforcement of formal institutions is influenced by three interdependent variables: the size of each sector, aggregate productivity, and organisational capabilities

Given that the traditional sector will likely face heavy losses from enforcement of formal institutions, it can be assumed that its power will generally be used for resistance and imposing high enforcement costs. The traditional sector has low productivity and limited access to capital, instead, its primary source of power comes from its ability to mobilise interest groups (Peters, 2012:23). By forming opposition groups, it can group capabilities to resist or undermine formal institutions by, for example, refusing to accept rules, influencing political processes, or engaging in conflict or violence (Khan, 2010:6).

By contrast, in the modern sector, which generally benefits from formal institutions, it can be assumed that its power will generally be applied to improving efficiency and enforcement. The modern sector has relatively high productivity and capital, its power comes from both its ability mobilise interest groups and to devise more capital intensive strategies by, for example, influencing government to tighten enforcement capabilities or political organisations to change rules in its favour. Most importantly, if productivity is sufficiently high, capital can be used to compensate losers to reduce resistance, enforcement costs, and conflict. Thus, as aggregate productivity rises, and both the size of the modern sector and its capital increases, so will its relative power.

Organisational capabilities also affect the distribution of power in three ways. First, neither sector is a cohesive whole, homogenous and with similar interests. While it is assumed that, at an aggregate level, the modern sector will support formal institutions and the traditional sector will oppose them, the level of resistance or support will depend on internal cohesiveness. This is because each sector has its own internal power structure which will also interact with the distribution of benefits by new rules, greater cohesiveness implies lower internal political transaction and enforcement costs. Second, better government enforcement capabilities can reduce transaction costs and costs of formalisation. Finally, exogenous inflow of resources (for example, FDI, foreign aid, military equipment) can also increase the relative power of particular groups.

Thus, as figure 11 illustrates, the distribution of power with regards enforcement of formal institutions can be modelled as a function of aggregate productivity (p) and relative power (r). In the traditional sector, where power is primarily driven by its size, relative power will fall as aggregate productivity rises. In the modern sector, where power is driven by its increased size and capital accumulation, relative power will rise with aggregate productivity. In all economies, at a given aggregate productivity (p*), the relative power of the modern sector

will be equal to that of the traditional sector (at p* = r*). This represents a turning point, whereby an increase in aggregate productivity will result in the ‘resistance power’ of the traditional sector (maximum enforcement costs it can impose) being lower than the modern sector’s ‘enforcement power’ (ability to reduce transaction costs through enforcement and compensation). Here, a predominately formal system can support relatively efficient exchanges and maintain a minimum level of economic and political viability. Conversely, a fall in aggregate productivity will result in the traditional sector being able to impose such high enforcement costs that exchanges become highly inefficient and a predominately formal system is likely to be unviable.

Of course, as figure 12 illustrates, organisational capabilities may also influence relative power independent of aggregate productivity. For instance, in the modern sector, changes that strengthen enforcement capabilities (e.g. improved tax auditing systems), increase access to capital (e.g. influx of FDI), and/ or lower political transaction costs (e.g. change in political cohesiveness) will shift the modern sector curve to the right (M1 to M2), lowering aggregate productivity necessary to become the dominant sector. In the traditional sector, changes that strengthen resistance capabilities, for example, improving political cohesiveness, will shift the curve to the right (T1 to T2).

Figure'11:'Distribution'of'power'with'regards'enforcement'of'formal'institutions'in'a'dual'sector'model'

The$distribution$of$power$with$regards$enforcement$of$formal$institutions$can$be$modelled$as$a$function$of$aggregate$productivity(p)$and$relative$power$(r).$ In$all$economies,$at$a$given$aggregate$productivity$(p*),$ the$relative$power$of$the$modern$sector will$be$equal$to$that$of$the$traditional$sector$(at$p*$=$r*).$

Source:$Author.$

Aggregate'

productivity'(p)

Relative'power'(r)

Modern'sector'(enforcement)

Traditional' sector'(resistance)

P*

r*

Modern'sector'‘enforcement'power’'

Ability'to'reduce'transaction'costs'through'

enforcement'and'compensation

=

Traditional'sector'‘resistance'power’'

Maximum'enforcement'costs'it'can'impose=

3.2.5 Developing economies are not productive enough to support a predominantly formal institutional system

In most developing economies, formal institutions cannot distribute benefits compatible with the distribution of power in society (Khan, 2010:24). The major reason is that full enforcement of formal institutions would benefit a smaller modern sector but would lead to devastating loses and hardship in a larger traditional sector. Further, while the modern sector accounts for the largest proportion of GDP, total capital is still too low to compensate the traditional sector with sufficiently low political transaction costs (see section 1.1.2 and 3.2.3). As figure 13 illustrates, in most developing economies, low levels of aggregate productivity (p1) results in the relative power of the traditional sector (r(t)1) being higher than the modern sector’s (r(m)1).

Figure'12:'Impact'of'increasing'organisational'capabilities'to'distribution'of'power

Source:(Author.(

a.'Modern'sectorStrengthening(enforcement(capabilities(and/(or(lower(political(transaction(costs(will(shift(the(modern(sector(curve(to(the(right((M1(to(M2),( lowering(the(aggregate(productivity(necessary(to(become(the(dominant(power.

Aggregate'

productivity'(p)

P2p1

r1 r2

M1 M2

Relative'power'(r)

Modern'sector'(enforcement)

Traditional' sector'(resistance)

Aggregate'

productivity'(p)

p1

p2

r1 r2

T1 T2

Relative'power'(r)

Modern'sector'(enforcement)

Traditional' sector'(resistance)

b.'Traditional'sectorImproving(internal(cohesiveness(will(shift(the(traditional(sector(curve(to(the(right((T1(to(T2),(raising(the(aggregate(productivity(necessary(for( the(formal(sector( to(become(the(dominant(power.

Developing*economies*are*not*productive*enough*to*support*a*predominantly*formal*institutional*system.

Figure'13:'Distribution'of'power'in'developing'economies'

Aggregate'

productivity'(p)

r(m)1 r(t)1

p1

Relative'power'(r)

Modern'sector'(enforcement)

Traditional' sector'(resistance)

Source:*Author.*

In this context, a political settlement where the distribution of benefits is predominantly administered through formal institutions cannot be achieved. The traditional sector has both the motive and power to undermine formal institutions; attempting to impose a predominantly formal system is likely to result in poor performance, partial enforcement, and/or conflict. Yet, in most developing economies formal institutions, albeit poorly performing ones, exit within functional political settlements. In other words, they have formal contract enforcement, property rights, taxes, regulations and governance agencies yet are still able to maintain a relatively stable social order. Clearly, other mechanisms must be in place that distributes additional benefits to the traditional sector.

Informal institutions, in the form of the informal economy, provide a vital mechanism for correcting the distributional mismatch between traditional and modern sectors. By operating outside of formal institutions, the traditional sector can, by avoiding the costs of taxes and regulations, compete with more productive formal peers and, by free-riding, partly share the benefits of improved infrastructure, public provisions and development projects. Overall, the informal economy provides a large part of the population with the means to maintain their standards of living above the limit of economic hardship that would result in conflict and an unviable system. As figure 14 illustrates, this is the key difference between the mainstream consensus and the political settlement analysis: rather than identifying the practices of the informal economy as a hindrance to development, they are identified as the main method by which conflict can be avoided while providing the modern sector with the formal institutions necessary for its effective operations. In other words, the traditional sector lives in the informal economy to obtain benefits consistent to its relative power within this ‘transitional institutional system’. Efforts to tighten enforcement, before a certain level of productivity is reached, are likely to be ineffective and result in strong resistance, continued informality, low confidence in formal institutions, or even a breakdown in social order.

3.2.6 Developed economies are productive enough to sustain a predominantly formal economy but need to compensate those excluded from formal work

By contrast, in more developed economies, the distribution of benefits by formal institutions is compatible with the distribution of power in society. Here, the modern sector accounts for

Figure'14:'Different'interpretations'of'the'informality' /'productivity'correlation'

a.'Mainstream'consensusInformality,hampers,productivity,growth,,thus,,reducing,informality,(1),will,lead,to,higher,productivity,growth,(2).

b.'Political'settlement'analysisIncreased,formalisation,driven,by,expansion,of,modern,sector,(1).,Formalisation,of,traditional,sector,cannot,be,sustained,within,a,viable,political,settlement,(2).

1

2

Source:,Calculation,by,author.,Data:,ILO,,World,Employment,and,Social,Outlook,I Trends,2015,,Datasets.

$1,000%

$10,000%

$100,000%

$1,000,000%

0% 25% 50% 75% 100%

Output%per%worker%(USD),%average%1991%to%2013,%

PPP%adjusted

%%of%labour%force%in%vulnerable%employment%,%average%1991%to%2013

Advanced Developing Emerging

$1,000%

$10,000%

$100,000%

$1,000,000%

0% 25% 50% 75% 100%

Output%per%worker%(USD),%average%1991%to%2013,%

PPP%adjusted

%%of%labour%force%in%vulnerable%employment%,%average%1991%to%2013

Advanced Developing Emerging

2

1

the vast majority of employment and its high productivity generates sufficient capital to compensate those that incur loses with acceptable political transaction costs. Even if compensation provided is lower than the total losses incurred, affected groups cannot impose enforcement costs that preclude the efficiency of institutions beyond minimum economic viability. As figure 15 illustrates, when economies achieve a certain level of aggregate productivity (p2), the relative power of the modern sector (r(m)2) becomes higher than the traditional sector’s (r(t)2).

In this context, formalisation can effectively be imposed throughout the economy by applying the proposed “good balance of sticks… and carrots” (Perry et al., 2007:14). To put in another way, while in the context of developing economies, enforcement will be resisted and generous compensation is politically unviable, in developed ones, enforcement and compensation form effective tools for formalising the economy.

When aggregate productivity is sufficiently high and the traditional sector’s resistance power is lower than the modern sector’s enforcement power, tightening enforcement should result in falling informality and increased confidence in formal institutions. One caveat is that, as argued in section 2.2.3 and 3.2.3, a side effect of tightening enforcement is higher unemployment. In most developing economies, those that cannot find work in formal modern employment are absorbed by the informal economy, which, through its ease of entry, provides an alternative income and, often, a lifeline during periods of economic adjustment (Udall/ Sinclair, 1982; appendix 2). In developed economies, where the informal economy is suppressed, those excluded from formal employment, or those employed by formal firms whose productivity is too low to provide adequate income, need to be compensated to reduce hardship. Failure to do so could lead to mobilisation against formal institutions (for example, though disruptive demonstrations, crime, violence) and higher enforcement costs. In response, unemployment benefits and other forms of social security are introduced to lower enforcement costs of resistance so that exchanges can be sufficiently efficient to maintain a minimum level of economic viability for all affected groups.

Developed(economies(are(productive(enough(to(sustain(a(predominantly(formal(economy.

Figure'15:'Distribution'of'power'in'developed'economies'

Aggregate'

productivity'(p)

r(t)2 r(m)2

p2

Relative'power'(r)

Modern'sector'(enforcement)

Traditional' sector'(resistance)

Source:(Author.(

3.2.7 As the economy transitions towards a predominately formal institutional system social security plays an important role in reducing enforcement costs

Significantly expanding social security is only feasible when aggregate productivity can support a predominately formal institutional system. Prior to this turning point, social security cannot reduce economic hardship below the threshold required for enforcement of formal institutions to be sustainable. This is because, for the traditional sector, the cost of formalisation is much higher than social security benefits and the modern sector is too small to provide alternative employment. Moreover, while redirecting resources towards social security may improve welfare, fiscal budgets are too small to provide programmes capable of significantly incentivising formalisation and are likely to be seen as poor returns on investment by those prioritising modern sector growth (World Bank, 2013:62). Of course, it is theoretically possible to raise taxes, however, the increase required to achieve notable results may imply unacceptable political transaction costs. For instance, financing essential healthcare coverage to the poorest 20 percent of Mexican households through VAT would imply a non-negligible 6.4 percent increase (Perry et al, 2007:2006). This redistribution, however welfare enhancing it may be, would likely face significant resistance from the politically well-connected modern sector.

Once aggregate productivity is high enough for a formal institutional system to be viable, social security plays an integral role in reducing hardship associated with formalisation. When this turning point is reached, the proportion affected is small enough and the fiscal resources high enough to roll-out more comprehensive social security programmes (for example, tax subsidies for low income workers, unemployment and healthcare insurance, old-age pensions). While formalisation still implies losses to those excluded from the modern sector, social protection lowers resistance and enforcement becomes incrementally effective. In other words, incremental rises in social spending not only increase welfare, but also accelerate the pace of employment modernisation and formalisation, important modern sector and government policy priorities (World Bank, 204:2013). In light of these tangible results, negotiating higher social spending will imply lower political transaction costs.

Indeed, analysis of cross-country data in figure 16 shows that in low productivity, mostly developing, economies public social expenditure (as percentage of GDP) and confidence in formal institutions (a measure of enforcement efficacy) remain low and stagnant; this paper suggests that these economies are likely to have ‘transitional institutional systems’. Once a given level of aggregate productivity is reached, comprising mostly developed and some emerging economies, both social expenditure and confidence in institutions rise simultaneously; this paper suggests that these economies are more likely to sustain a ‘predominately formal institutional systems’.

Of course, some economies do not align neatly to the expected pattern, for example, some economies have: high productivity but low enforcement; low productivity but high social protection; high productivity but low social protection. There are at least two reasons for these inconsistencies. First, aggregate productivity data does not shed light on the productivity gap between sectors, for instance, an economy with a smaller but very productive modern sector may have a similar aggregate productivity to an economy with a larger but less productive one. It is likely that compensation costs and political transaction costs would be different in these scenarios. Second, the analysis does not take into account differences in organisational capabilities that, as section 3.2.4 discussed, can change the aggregate productivity required for a predominately formal institutional system to become viable. However, even with these limitation and data ‘anomalies’, cross-country evidence largely supports political settlement conclusions.

Figure'16:'Transition'towards'a'formal' institutional'system'and'impact'on'social'security'and'enforcement

a.'Social'expenditure'versus'productivitySocial'expenditures'(as'percentage'of'GDP)'remain'stable'and'low'in'developing'economies'(1).'Once'a'given'productivity'is'reached,'expenditure'increases'with'productivity'(2).

b.'Unemployment'insurance'coverage'versus'productivityUnemployment'insurance'is'generally'not'provided'in'developing'economies'(1).'Once'a'given'productivity'is'reached,'cover'increases'with'productivity'(2).

Source:'Calculation'by'author.'Data:'ILO,'World'Employment'and'Social'Outlook'K Trends'2015,'DatasetsO'World'Bank'K The'Worldwide'Governance'Indicators'2014,'DatasetsO'ILO,'Social'Protection'Datasets'– 2015.

c.'Rule'of'law'index'versus'productivityRule'of'law'index'generally'remains'stable'in'developing'economies'(1).'Once'a'given'productivity'is'reached,'indices'increase'with'productivity'(2).

R²#=#0.59084

!2.5

!1.5

!0.5

0.5

1.5

2.5

1000 10000 100000

Rule#of#law#index,#average#2000#to#2013

Output#per#worker#(USD),#average#2000#to#2013,#PPP#adjusted

Advanced Developing Emerging

2

1

R²#=#0.460810

5

10

15

20

25

30

35

1000 10000 100000

Average#total#public#social#expenditure#as#a#

percentage#of#GDP,#average#2000#to#2013

Output#per#worker#(USD),#average#2000#to#2013,#PPP#adjusted

Advanced Developing Emerging

2

1

R²#=#0.555450

25

50

75

100

1000 10000 100000

Average#percentage#of#unemployed#recieving#

unemployment#insurance,#average#2000#to#2013

Output#per#worker#(USD),#average#2000#to#2013,#PPP#adjusted

Advanced Developing Emerging

2

1

d.'Rule'of'law'index'versus'social'expenditureRule'of'law'index'generally'remains'low'while'social'expenditure'is'low'(1).'Rule'of'law'increases'with'social'expenditure'(2).

R²#=#0.42625

+2.5

+1.5

+0.5

0.5

1.5

2.5

0 10 20 30

Rule#of#law#index,#average#2000#to#2013

Average#total#public#social#expenditure#as#a#percentage#of#GDP,#average#2000#to#2013

Advanced Developing Emerging

Sample'size:'154'economies Sample'size:'149'economies

Sample'size:'166'economies Sample'size:'154'economies

1

2

4. Conclusion

While the mainstream definition and understanding of informality has significantly evolved over the past 60 years, one underlying assumption has remained: the informal economy presents a barrier to development and, thus, should be the subject of targeted interventions. Those that see informality with largely negative connotations propose tightening enforcement, implementing ‘business-friendly’ regulations, and improving worker protection. Others, that see informality it in a more positive light, focus on unleashing the potential of informal entrepreneurs by improving property rights and access to finance. Both perspectives share the belief that better formal institutions with effective enforcement can, and should, be a policy priority for developing economies. Nevertheless, cross-country evidence presented in this paper casts doubt on the validity of these conclusions. Specifically, it highlights four findings that contradict the current consensus. First, there is no evidence of any low-productivity economy achieving high rates of formality. Second, the size of the informal economy has no discernible impact on productivity growth. Third, poor regulations do not prevent informal firms from competing in the formal economy. Fourth, practices of informal sector do not significantly hamper the creative destruction process.

These findings are broadly consistent with the view that the informal economy is inherent to developing economies and that, even with the best political will, efforts to increase formalisation will remain unsuccessful. This is because developing economies are dualistic, where a smaller modern sector requires formal institutions to operate effectively and a much larger traditional sector incurs devastating losses from their enforcement. In this context formalisation will inevitably face overwhelming resistance and will result in one of two outcomes. In the first, enforcement efforts result in partial enforcement: the modern sector operates in a predominately formal system, while the traditional sector avoids the worst consequences of formality by operating in the informal economy. In the second, enforcement efforts result in conflict and an unviable institutional system: formal institutions are summarily enforced on the traditional sector leading to devastating hardship, mobilisation against formal institutions, and, ultimately, a breakdown in social order. Given the political and economic implications of each, it unsurprising that the former would be the most common.

In sum, informality is a symptom of underdevelopment. It occurs in economies that have yet to develop a large, dominant, productive modern sector and where productivity is insufficient to compensate and protect those excluded from modern sector employment. Modern sector growth will not be achieved by formalising the traditional sector. Most traditional firms face unsurmountable structural barriers that prevent them from modernising. The modern sector will only grow by expanding existing productive firms and encouraging new modern firms to enter the market. Thus, efforts to reduce the size of the informal economy need to target the modern formal sector, rather than the informal economy.

Appendices: Supporting Data

Figure 1: Significance of the informal economy in developing economies Informal employment as percentage of labour force (2004-2010)

Employment type Average across all regions*

South Asia

Sub-Saharan Africa

East and Southeast Asia

Latin America

Middle East and North Africa

Eastern Europe (non-EU) & Central Asia

Informal Employment 65% 82% 66% 65% 51% 45% 10% Formal Employment 34% 18% 34% 35% 49% 55% 90% Source: Calculation by author. Data: ILO and WIEGO – Women and Men in the Informal Economy: A Statistical Picture (2014), data file *Weighed by regional share of labour force (2004-2010). Source: World Bank Data (2015), http://data.worldbank.org. Informal economy weighted by total GDP (2005)

Employment type Average across all regions*

South Asia

Sub-Saharan Africa

East and Southeast Asia

Latin America

Middle East and North Africa

Eastern Europe (non-EU) & Central Asia

Informal Economy 27% 25% 38% 18% 35% 27% 36% Formal Economy 73% 75% 62% 82% 65% 73% 64% Source: Calculation by author. Data: Data by World Bank - Shadow Economies All over the World: New Estimates for 162 Countries from 1999 to 2007, data in Appendix. *Weighed by regional share of GDP (2005). Source: World Bank Data (2015), http://data.worldbank.org.

Figure 2: Informal jobs in total employment versus vulnerable employment

Country % of labour force in vulnerable employment, average 2004 to 2008

Share of informal jobs in total employment, average 2004 to 2008

Argentina 20.4% 49.7% Armenia 39.8% 19.8% Bolivia 58.9% 75.1% Brazil 29.2% 42.2% Colombia 44.6% 59.6% Costa Rica 21.0% 43.8% Dominican Republic 42.5% 48.5% Ecuador 41.8% 60.9% El Salvador 39.3% 66.4% Honduras 49.1% 73.9% India 82.6% 83.5% Lesotho 17.9% 34.9% Liberia 81.6% 60.0% Madagascar 85.4% 73.6% Mali 87.5% 81.8% Mexico 30.3% 53.7% Namibia 15.5% 43.8% Nicaragua 45.5% 65.7% Panama 29.7% 43.8% Paraguay 48.4% 70.7% Peru 50.5% 70.6% Philippines 43.8% 70.1% Serbia 29.8% 6.1% South Africa 12.4% 32.7% Sri Lanka 39.5% 62.1% Tanzania, United Republic of 87.8% 76.2%

Turkey 37.5% 30.6% Uganda 82.9% 68.5% Uruguay 25.1% 39.8% Venezuela 31.0% 47.5% Viet Nam 68.3% 68.2% West Bank and Gaza 35.3% 57.2%

Country % of labour force in vulnerable employment, average 2004 to 2008

Share of informal jobs in total employment, average 2004 to 2008

Strip Zambia 78.5% 69.5% Source: Calculation by author. Data: : ILO and WIEGO – Women and Men in the Informal Economy: A Statistical Picture (2014), data file; ILO, World Employment and Social Outlook - Trends 2015, Datasets.

Figure 3: Informality versus productivity

Country Development status (ILO definition)

% of labour force in vulnerable employment, average 1991 to 2013

Annual growth in % of labour force in vulnerable employment, average 1991 to 2013

Output per worker (USD), average 1991 to 2013, PPP adjusted

Annual growth in output per worker (USD), average 1991 to 2013, PPP adjusted

Australia Advanced 10.1% -0.1% $74,148 1.3% Austria Advanced 8.9% 0.0% $79,188 0.9% Belgium Advanced 12.5% -0.2% $91,915 0.8% Denmark Advanced 5.5% -0.2% $78,266 1.0% Estonia Advanced 5.2% 0.4% $37,281 2.1% Finland Advanced 10.6% 0.0% $72,554 1.3% France Advanced 7.7% 0.1% $85,076 2.8% Germany Advanced 6.3% -0.2% $77,531 1.8% Greece Advanced 33.1% -0.2% $64,359 0.8% Hong Kong, China Advanced 6.5% 0.1% $76,189 0.9% Hungary Advanced 8.9% -0.4% $49,200 1.1% Iceland Advanced 10.8% 0.1% $61,864 2.6% Ireland Advanced 13.6% 0.0% $88,882 1.6% Israel Advanced 7.6% -0.2% $71,957 1.2% Italy Advanced 17.7% -0.2% $89,401 2.0% Japan Advanced 13.0% 0.0% $65,172 0.6% Korea, Republic of Advanced 29.5% -0.4% $48,123 0.4% Lithuania Advanced 14.2% -0.4% $36,337 0.8% Luxembourg Advanced 5.1% -0.7% $186,352 3.5% Macau, China Advanced 6.5% -0.3% $115,490 1.9% Malta Advanced 10.5% 0.0% $61,855 1.4% Netherlands Advanced 9.0% -0.2% $78,727 4.0% New Zealand Advanced 12.4% -0.1% $58,117 1.8% Norway Advanced 6.6% 0.2% $113,548 0.7% Portugal Advanced 19.9% -0.1% $50,606 1.0% Singapore Advanced 9.4% -0.2% $107,293 1.3% Slovakia Advanced 7.5% -0.4% $42,202 1.2% Slovenia Advanced 12.9% 0.0% $50,420 2.8% Spain Advanced 15.4% 0.4% $76,950 3.0% Sweden Advanced 7.6% 0.1% $73,039 1.6% Switzerland Advanced 9.7% -0.4% $86,373 0.7% United Kingdom Advanced 10.2% -0.1% $66,687 2.0% United States Advanced 7.1% 0.0% $92,700 0.7% Canada Advanced 13.9% 0.1% $74,426 1.7% Czech Republic Advanced 10.9% -0.1% $45,423 1.6% Afghanistan Developing 79.2% -0.6% $5,245 2.5% Albania Developing 65.4% -0.4% $15,641 5.1% Algeria Developing 34.9% -0.3% $46,862 -0.5% Angola Developing 58.8% -0.9% $13,197 2.6% Armenia Developing 46.4% -0.6% $11,479 3.1% Azerbaijan Developing 70.5% -0.5% $18,249 2.0% Bahamas Developing 14.1% 0.1% $50,461 -0.5% Bangladesh Developing 83.8% -0.2% $3,500 3.2% Barbados Developing 14.3% 0.2% $29,853 0.0% Belize Developing 26.0% -0.2% $21,649 0.6% Benin Developing 89.7% 0.0% $3,846 0.8% Bhutan Developing 68.6% -0.8% $10,010 3.4% Bolivia Developing 62.0% -0.6% $10,940 1.1% Bosnia and Herzegovina Developing 33.8% -1.3% $22,557 7.8%

Botswana Developing 28.7% -0.7% $29,078 1.5%

Country Development status (ILO definition)

% of labour force in vulnerable employment, average 1991 to 2013

Annual growth in % of labour force in vulnerable employment, average 1991 to 2013

Output per worker (USD), average 1991 to 2013, PPP adjusted

Annual growth in output per worker (USD), average 1991 to 2013, PPP adjusted

Burkina Faso Developing 93.1% -0.2% $2,629 2.4% Cambodia Developing 80.4% -1.1% $3,367 3.7% Cameroon Developing 78.0% -0.2% $6,530 -0.3% Chad Developing 92.3% -0.2% $4,044 2.5% Comoros Developing 87.0% 0.1% $5,359 -1.0% Congo Developing 75.9% 0.0% $13,402 0.0% Congo, Democratic Republic of Developing 81.5% -0.2% $1,834 -2.0%

Côte d'Ivoire Developing 77.4% -0.2% $7,663 -0.4% Cuba Developing 14.0% 0.4% $31,011 1.6% Cyprus Developing 17.1% -0.3% $47,181 0.4% Dominican Republic Developing 41.9% 0.1% $21,074 3.0%

Ecuador Developing 41.4% 0.0% $19,435 0.4% Egypt Developing 24.9% -0.1% $29,324 2.0% El Salvador Developing 38.8% 0.2% $17,674 1.3% Equatorial Guinea Developing 33.3% -1.2% $40,465 15.1% Eritrea Developing 70.2% -0.6% $3,193 0.1% Ethiopia Developing 91.7% -0.2% $1,720 3.1% Fiji Developing 39.3% 0.1% $19,852 0.9% Gabon Developing 46.6% -0.9% $62,508 -0.4% Gambia Developing 72.1% 0.0% $3,938 0.3% Georgia Developing 59.1% 0.9% $9,236 0.7% Ghana Developing 73.9% -0.2% $6,223 2.4% Guatemala Developing 45.6% 0.0% $17,757 0.6% Guinea Developing 95.2% 0.0% $2,923 0.3% Guinea-Bissau Developing 90.0% -0.2% $3,610 -1.5% Guyana Developing 43.8% 0.1% $14,609 2.6% Haiti Developing 53.6% 0.3% $4,743 -1.6% Honduras Developing 49.4% 0.0% $10,606 0.4% Iran, Islamic Republic of Developing 46.6% -0.6% $45,470 0.7%

Iraq Developing 18.1% -0.3% $59,260 1.0% Jamaica Developing 37.5% -0.2% $20,865 0.5% Jordan Developing 11.3% -0.2% $39,265 0.9% Kyrgyzstan Developing 48.4% -0.1% $5,999 -0.5% Lao People's Democratic Republic

Developing 88.5% -0.3% $5,816 4.0%

Lebanon Developing 33.2% -0.4% $43,154 0.3% Lesotho Developing 38.1% -2.3% $6,137 2.1% Liberia Developing 82.6% -0.2% $1,386 2.6% Libya Developing 8.0% -0.1% $91,543 -2.9% Madagascar Developing 85.3% 0.1% $3,063 -0.8% Malawi Developing 91.4% -0.1% $1,551 0.9% Malaysia Developing 22.8% -0.2% $40,803 2.7% Maldives Developing 31.2% -1.2% $23,466 1.5% Mali Developing 88.9% 0.1% $5,081 0.5% Mauritania Developing 75.9% -0.7% $9,039 0.4% Mongolia Developing 58.9% -0.2% $12,401 2.5% Montenegro Developing 35.1% -0.1% $33,610 1.5% Morocco Developing 53.5% -0.9% $16,625 1.4% Mozambique Developing 88.3% -0.2% $1,765 3.4% Myanmar Developing 93.9% -0.3% $1,472 6.3% Namibia Developing 27.4% -1.5% $25,012 1.2% Nepal Developing 72.4% -0.2% $3,269 1.9% Nicaragua Developing 46.5% -0.3% $10,123 0.5% Niger Developing 93.9% 0.4% $2,700 -0.5% Nigeria Developing 85.0% -0.3% $12,486 2.7% Pakistan Developing 62.8% -0.2% $12,364 0.7% Panama Developing 30.4% -0.2% $28,410 2.2%

Country Development status (ILO definition)

% of labour force in vulnerable employment, average 1991 to 2013

Annual growth in % of labour force in vulnerable employment, average 1991 to 2013

Output per worker (USD), average 1991 to 2013, PPP adjusted

Annual growth in output per worker (USD), average 1991 to 2013, PPP adjusted

Papua New Guinea Developing 78.1% -0.3% $4,736 1.2% Paraguay Developing 47.5% -0.4% $15,245 0.6% Peru Developing 52.5% -0.6% $16,321 1.7% Philippines Developing 44.6% -0.1% $12,313 1.6% Rwanda Developing 88.1% -0.4% $2,015 1.8% Senegal Developing 76.5% -0.6% $5,183 0.4% Sierra Leone Developing 91.9% -0.1% $3,223 1.0% Solomon Islands Developing 77.4% -0.1% $5,071 -0.1% Sri Lanka Developing 39.7% 0.1% $14,260 3.6% Sudan Developing 83.4% -0.5% $12,813 0.7% Swaziland Developing 20.1% -0.1% $24,243 -0.1% Taiwan, China Developing 21.6% -0.4% $47,398 3.2% Tajikistan Developing 46.6% 0.6% $4,873 -2.0% Tanzania, United Republic of Developing 89.1% -0.4% $2,447 2.2%

Togo Developing 87.9% 0.1% $3,042 -0.5% Trinidad and Tobago Developing 17.8% -0.2% $50,240 1.2%

Tunisia Developing 29.5% -0.3% $27,265 1.8% Turkmenistan Developing 25.8% -0.1% $19,259 1.5% Uganda Developing 86.2% -0.3% $2,458 3.5% Uzbekistan Developing 37.1% 0.0% $8,674 1.5% Viet Nam Developing 74.8% -1.0% $5,433 4.5% West Bank and Gaza Strip Developing 33.3% -0.6% $20,184 2.3%

Yemen Developing 49.0% -0.9% $18,821 -0.8% Zambia Developing 78.8% 0.0% $6,551 0.7% Zimbabwe Developing 64.5% 0.2% $4,976 -3.2% Burundi Developing 93.1% -0.2% $1,879 2.1% Brunei Darussalam Emerging 4.4% -1.0% $168,641 3.7% Argentina Emerging 22.2% -0.5% $26,276 0.8% Belarus Emerging 10.9% 0.0% $21,753 -0.9% Brazil Emerging 31.3% -0.1% $25,865 2.3% Bulgaria Emerging 10.9% -0.1% $28,698 -1.5% Chile Emerging 26.0% -0.2% $40,201 2.3% China Emerging 56.9% -1.3% $8,778 8.4% Colombia Emerging 44.6% 0.3% $24,763 0.2% Costa Rica Emerging 21.8% -0.2% $24,890 1.7% Croatia Emerging 19.5% -0.2% $42,123 2.3% India Emerging 82.7% -0.2% $8,046 4.6% Indonesia Emerging 59.6% -1.4% $14,742 2.4% Kazakhstan Emerging 36.5% 0.0% $28,734 2.4% Kenya Emerging 61.5% -0.1% $5,575 0.4% Kuwait Emerging 2.3% 0.0% $169,616 4.0% Latvia Emerging 10.1% -0.2% $32,654 2.7% Mauritius Emerging 17.3% -0.1% $29,136 2.9% Mexico Emerging 33.3% -0.4% $37,485 0.3% Oman Emerging 7.8% -0.3% $113,179 -0.5% Poland Emerging 22.8% -0.4% $37,957 3.8% Puerto Rico Emerging 13.5% 0.0% $106,045 0.9% Qatar Emerging 0.4% 0.0% $173,929 1.4% Romania Emerging 35.3% 0.2% $26,753 2.1% Russian Federation Emerging 4.7% 0.2% $35,164 0.6% Saudi Arabia Emerging 5.2% -0.1% $128,271 0.5% Serbia Emerging 28.9% 0.2% $19,421 0.1% South Africa Emerging 14.2% -0.5% $35,951 0.8% Suriname Emerging 16.0% 0.0% $34,865 1.1% Thailand Emerging 57.6% -0.5% $18,136 2.8% Turkey Emerging 44.6% -1.2% $44,250 2.4% Ukraine Emerging 14.0% 0.5% $14,927 -0.7% United Arab Emerging 1.6% -0.1% $169,441 -3.9%

Country Development status (ILO definition)

% of labour force in vulnerable employment, average 1991 to 2013

Annual growth in % of labour force in vulnerable employment, average 1991 to 2013

Output per worker (USD), average 1991 to 2013, PPP adjusted

Annual growth in output per worker (USD), average 1991 to 2013, PPP adjusted

Emirates Uruguay Emerging 25.2% -0.1% $29,332 2.2% Venezuela Emerging 32.6% 0.0% $40,298 -0.5%

Source: Calculation by author. Data: ILO, World Employment and Social Outlook - Trends 2015, Datasets.

Figure 5: Informality versus rule of law

Country Development status (ILO definition)

% of labour force in vulnerable employment, average 2000 to 2013

Rule of law index, average 2000 to 2013

Australia Advanced 9.0% 1.7 Austria Advanced 9.0% 1.9 Belgium Advanced 11.0% 1.3 Denmark Advanced 13.0% 1.7 Estonia Advanced 13.0% 0.9 Finland Advanced 5.0% 1.9 France Advanced 5.0% 0.9 Germany Advanced 9.0% 1.9 Greece Advanced 7.0% 1.4 Hong Kong, China Advanced 7.0% 1.6 Hungary Advanced 30.0% 0.7 Iceland Advanced 7.0% 1.4 Ireland Advanced 8.0% 0.8 Israel Advanced 10.0% 1.8 Italy Advanced 12.0% 1.6 Japan Advanced 8.0% 0.9 Korea, Republic of Advanced 18.0% 0.5 Lithuania Advanced 11.0% 1.3 Luxembourg Advanced 25.0% 0.9 Macau, China Advanced 13.0% 0.6 Malta Advanced 5.0% 1.8 Netherlands Advanced 6.0% 0.6 New Zealand Advanced 10.0% 1.4 Norway Advanced 9.0% 1.8 Portugal Advanced 12.0% 1.8 Singapore Advanced 6.0% 1.9 Slovakia Advanced 19.0% 1.1 Slovenia Advanced 10.0% 1.6 Spain Advanced 10.0% 0.4 Sweden Advanced 13.0% 1.0 Switzerland Advanced 13.0% 1.2 United Kingdom Advanced 7.0% 1.9 United States Advanced 10.0% 1.8 Canada Advanced 11.0% 1.7 Czech Republic Advanced 7.0% 1.5 Afghanistan Developing 77.0% -1.8 Albania Developing 62.0% -0.8 Algeria Developing 36.0% -0.8 Angola Developing 55.0% -1.4 Armenia Developing 42.0% -0.4 Azerbaijan Developing 67.0% -0.9 Bahamas Developing 14.0% 1.0 Bangladesh Developing 83.0% -0.9 Barbados Developing 15.0% 1.2 Belize Developing 24.0% -0.2 Benin Developing 90.0% -0.5 Bhutan Developing 68.0% 0.2 Bolivia Developing 59.0% -0.8 Bosnia and Herzegovina Developing 28.0% -0.5 Botswana Developing 24.0% 0.6

Country Development status (ILO definition)

% of labour force in vulnerable employment, average 2000 to 2013

Rule of law index, average 2000 to 2013

Burkina Faso Developing 92.0% -0.5 Cambodia Developing 76.0% -1.1 Cameroon Developing 77.0% -1.1 Chad Developing 91.0% -1.4 Comoros Developing 88.0% -1.1 Congo Developing 76.0% -1.7 Congo, Democratic Republic of Developing 81.0% -1.3

Côte d'Ivoire Developing 77.0% -1.3 Cuba Developing 16.0% -0.8 Cyprus Developing 16.0% 1.0 Dominican Republic Developing 43.0% -0.6 Ecuador Developing 42.0% -0.9 Egypt Developing 24.0% -0.1 El Salvador Developing 40.0% -0.7 Equatorial Guinea Developing 27.0% -1.3 Eritrea Developing 68.0% -0.9 Ethiopia Developing 91.0% -0.8 Fiji Developing 38.0% -0.4 Gabon Developing 42.0% -0.5 Gambia Developing 72.0% -0.3 Georgia Developing 63.0% -0.6 Ghana Developing 73.0% -0.1 Guatemala Developing 45.0% -1.1 Guinea Developing 95.0% -1.4 Guinea-Bissau Developing 89.0% -1.4 Guyana Developing 45.0% -0.5 Haiti Developing 55.0% -1.5 Honduras Developing 50.0% -0.9 Iran, Islamic Republic of Developing 44.0% -0.8 Iraq Developing 17.0% -1.6 Jamaica Developing 36.0% -0.4 Jordan Developing 10.0% 0.3 Kyrgyzstan Developing 46.0% -1.1 Lao People's Democratic Republic Developing 87.0% -1.0

Lebanon Developing 32.0% -0.5 Lesotho Developing 18.0% -0.2 Liberia Developing 80.0% -1.4 Libya Developing 8.0% -1.0 Madagascar Developing 86.0% -0.5 Malawi Developing 91.0% -0.3 Malaysia Developing 21.0% 0.5 Maldives Developing 26.0% 0.0 Mali Developing 88.0% -0.4 Mauritania Developing 73.0% -0.7 Mongolia Developing 58.0% -0.2 Montenegro Developing 34.0% Morocco Developing 51.0% -0.1 Mozambique Developing 87.0% -0.7 Myanmar Developing 92.0% -1.5 Namibia Developing 23.0% 0.2 Nepal Developing 71.0% -0.7 Nicaragua Developing 46.0% -0.7 Niger Developing 95.0% -0.7 Nigeria Developing 84.0% -1.2 Pakistan Developing 62.0% -0.8 Panama Developing 30.0% -0.2 Papua New Guinea Developing 78.0% -0.9 Paraguay Developing 47.0% -1.0 Peru Developing 50.0% -0.6 Philippines Developing 44.0% -0.4 Rwanda Developing 85.0% -0.8 Senegal Developing 74.0% -0.2

Country Development status (ILO definition)

% of labour force in vulnerable employment, average 2000 to 2013

Rule of law index, average 2000 to 2013

Sierra Leone Developing 92.0% -1.1 Solomon Islands Developing 78.0% -0.7 Sri Lanka Developing 40.0% 0.1 Sudan Developing 80.0% -1.4 Swaziland Developing 19.0% -0.6 Taiwan, China Developing 20.0% 0.9 Tajikistan Developing 48.0% -1.2 Tanzania, United Republic of Developing 87.0% -0.4 Togo Developing 88.0% -0.9 Trinidad and Tobago Developing 16.0% 0.0 Tunisia Developing 28.0% 0.0 Turkmenistan Developing 25.0% -1.4 Uganda Developing 83.0% -0.5 Uzbekistan Developing 37.0% -1.3 Viet Nam Developing 70.0% -0.4 West Bank and Gaza Strip Developing 32.0% -0.4 Yemen Developing 44.0% -1.2 Zambia Developing 78.0% -0.5 Zimbabwe Developing 67.0% -1.6 Burundi Developing 21.0% -0.6 Brunei Darussalam Emerging 2.0% -1.1 Argentina Emerging 29.0% -0.3 Belarus Emerging 5.0% 0.6 Brazil Emerging 10.0% -0.2 Bulgaria Emerging 93.0% -1.3 Chile Emerging 25.0% 1.3 China Emerging 51.0% -0.4 Colombia Emerging 46.0% -0.6 Costa Rica Emerging 21.0% 0.5 Croatia Emerging 18.0% 0.0 India Emerging 82.0% 0.1 Indonesia Emerging 57.0% -0.7 Kazakhstan Emerging 34.0% -0.9 Kenya Emerging 60.0% -0.9 Kuwait Emerging 2.0% 0.6 Latvia Emerging 9.0% 0.6 Mauritius Emerging 17.0% 0.9 Mexico Emerging 30.0% -0.5 Oman Emerging 5.0% 0.6 Poland Emerging 21.0% 0.6 Puerto Rico Emerging 14.0% 0.8 Qatar Emerging 0.0% 0.7 Romania Emerging 35.0% -0.1 Russian Federation Emerging 6.0% -0.9 Saudi Arabia Emerging 5.0% 0.2 Serbia Emerging 30.0% -0.7 South Africa Emerging 13.0% 0.1 Suriname Emerging 16.0% -0.2 Thailand Emerging 54.0% 0.1 Turkey Emerging 38.0% 0.0 Ukraine Emerging 16.0% -0.8 United Arab Emirates Emerging 1.0% 0.5 Uruguay Emerging 25.0% 0.5 Venezuela Emerging 33.0% -1.4

Source: Calculation by author. Data: ILO, World Employment and Social Outlook - Trends 2015, Datasets; World Bank - The Worldwide Governance Indicators 2014

Figure 6: Informality versus productivity growth

Country Development status (ILO definition)

% of labour force in vulnerable employment, average 1991 to 2013

Annual growth in output per worker (USD), average 1991 to 2013, PPP adjusted

Country Development status (ILO definition)

% of labour force in vulnerable employment, average 1991 to 2013

Annual growth in output per worker (USD), average 1991 to 2013, PPP adjusted

Australia Advanced 10.1% 1.3% Austria Advanced 8.9% 0.9% Belgium Advanced 12.5% 0.8% Denmark Advanced 5.5% 1.3% Estonia Advanced 5.2% 2.8% Finland Advanced 10.6% 1.8% France Advanced 7.7% 0.8% Germany Advanced 6.3% 0.9% Greece Advanced 33.1% 1.1% Hong Kong, China Advanced 6.5% 2.6% Hungary Advanced 8.9% 1.6% Iceland Advanced 10.8% 1.2% Ireland Advanced 13.6% 2.0% Israel Advanced 7.6% 0.6% Italy Advanced 17.7% 0.4% Japan Advanced 13.0% 0.8% Korea, Republic of Advanced 29.5% 3.5% Lithuania Advanced 14.2% 1.9% Luxembourg Advanced 5.1% 1.4% Macau, China Advanced 6.5% 4.0% Malta Advanced 10.5% 1.8% Netherlands Advanced 9.0% 0.7% New Zealand Advanced 12.4% 1.0% Norway Advanced 6.6% 1.3% Portugal Advanced 19.9% 1.2% Singapore Advanced 9.4% 2.8% Slovakia Advanced 7.5% 3.0% Slovenia Advanced 12.9% 1.6% Spain Advanced 15.4% 0.7% Sweden Advanced 7.6% 2.0% Switzerland Advanced 9.7% 0.7% United Kingdom Advanced 10.2% 1.7% United States Advanced 7.1% 1.6% Canada Advanced 10.9% 2.1% Czech Republic Advanced 79.2% 2.5% Afghanistan Developing 65.4% 5.1% Albania Developing 34.9% -0.5% Algeria Developing 58.8% 2.6% Angola Developing 46.4% 3.1% Armenia Developing 70.5% 2.0% Azerbaijan Developing 14.1% -0.5% Bahamas Developing 83.8% 3.2% Bangladesh Developing 14.3% 0.0% Barbados Developing 26.0% 0.6% Belize Developing 89.7% 0.8% Benin Developing 68.6% 3.4% Bhutan Developing 62.0% 1.1% Bolivia Developing 33.8% 7.8% Bosnia and Herzegovina Developing 28.7% 1.5% Botswana Developing 93.1% 2.4% Burkina Faso Developing 80.4% 3.7% Cambodia Developing 78.0% -0.3% Cameroon Developing 13.9% 1.0% Chad Developing 92.3% 2.5% Comoros Developing 87.0% -1.0% Congo Developing 75.9% 0.0% Congo, Democratic Republic of Developing 81.5% -2.0% Côte d'Ivoire Developing 77.4% -0.4% Cuba Developing 14.0% 1.6% Cyprus Developing 17.1% 0.4% Dominican Republic Developing 41.9% 3.0% Ecuador Developing 41.4% 0.4% Egypt Developing 24.9% 2.0%

Country Development status (ILO definition)

% of labour force in vulnerable employment, average 1991 to 2013

Annual growth in output per worker (USD), average 1991 to 2013, PPP adjusted

El Salvador Developing 38.8% 1.3% Equatorial Guinea Developing 33.3% 15.1% Eritrea Developing 70.2% 0.1% Ethiopia Developing 91.7% 3.1% Fiji Developing 39.3% 0.9% Gabon Developing 46.6% -0.4% Gambia Developing 72.1% 0.3% Georgia Developing 59.1% 0.7% Ghana Developing 73.9% 2.4% Guatemala Developing 45.6% 0.6% Guinea Developing 95.2% 0.3% Guinea-Bissau Developing 90.0% -1.5% Guyana Developing 43.8% 2.6% Haiti Developing 53.6% -1.6% Honduras Developing 49.4% 0.4% Iran, Islamic Republic of Developing 46.6% 0.7% Iraq Developing 18.1% 1.0% Jamaica Developing 37.5% 0.5% Jordan Developing 11.3% 0.9% Kyrgyzstan Developing 48.4% -0.5% Lao People's Democratic Republic Developing 88.5% 4.0% Lebanon Developing 33.2% 0.3% Lesotho Developing 38.1% 2.1% Liberia Developing 82.6% 2.6% Libya Developing 8.0% -2.9% Madagascar Developing 85.3% -0.8% Malawi Developing 91.4% 0.9% Malaysia Developing 22.8% 2.7% Maldives Developing 31.2% 1.5% Mali Developing 88.9% 0.5% Mauritania Developing 75.9% 0.4% Mongolia Developing 58.9% 2.5% Montenegro Developing 35.1% 1.5% Morocco Developing 53.5% 1.4% Mozambique Developing 88.3% 3.4% Myanmar Developing 93.9% 6.3% Namibia Developing 27.4% 1.2% Nepal Developing 72.4% 1.9% Nicaragua Developing 46.5% 0.5% Niger Developing 93.9% -0.5% Nigeria Developing 85.0% 2.7% Pakistan Developing 62.8% 0.7% Panama Developing 30.4% 2.2% Papua New Guinea Developing 78.1% 1.2% Paraguay Developing 47.5% 0.6% Peru Developing 52.5% 1.7% Philippines Developing 44.6% 1.6% Rwanda Developing 88.1% 1.8% Senegal Developing 76.5% 0.4% Sierra Leone Developing 91.9% 1.0% Solomon Islands Developing 77.4% -0.1% Sri Lanka Developing 39.7% 3.6% Sudan Developing 83.4% 0.7% Swaziland Developing 20.1% -0.1% Taiwan, China Developing 21.6% 3.2% Tajikistan Developing 46.6% -2.0% Tanzania, United Republic of Developing 89.1% 2.2% Togo Developing 87.9% -0.5% Trinidad and Tobago Developing 17.8% 1.2% Tunisia Developing 29.5% 1.8% Turkmenistan Developing 25.8% 1.5% Uganda Developing 86.2% 3.5% Uzbekistan Developing 37.1% 1.5%

Country Development status (ILO definition)

% of labour force in vulnerable employment, average 1991 to 2013

Annual growth in output per worker (USD), average 1991 to 2013, PPP adjusted

Viet Nam Developing 74.8% 4.5% West Bank and Gaza Strip Developing 33.3% 2.3% Yemen Developing 49.0% -0.8% Zambia Developing 78.8% 0.7% Zimbabwe Developing 64.5% -3.2% Burundi Developing 93.1% -1.5% Brunei Darussalam Emerging 4.4% -0.9% Argentina Emerging 22.2% 2.1% Belarus Emerging 10.9% 3.7% Brazil Emerging 31.3% 0.8% Bulgaria Emerging 10.9% 2.3% Chile Emerging 26.0% 2.3% China Emerging 56.9% 8.4% Colombia Emerging 44.6% 0.2% Costa Rica Emerging 21.8% 1.7% Croatia Emerging 19.5% 2.3% India Emerging 82.7% 4.6% Indonesia Emerging 59.6% 2.4% Kazakhstan Emerging 36.5% 2.4% Kenya Emerging 61.5% 0.4% Kuwait Emerging 2.3% 4.0% Latvia Emerging 10.1% 2.7% Mauritius Emerging 17.3% 2.9% Mexico Emerging 33.3% 0.3% Oman Emerging 7.8% -0.5% Poland Emerging 22.8% 3.8% Puerto Rico Emerging 13.5% 0.9% Qatar Emerging 0.4% 1.4% Romania Emerging 35.3% 2.1% Russian Federation Emerging 4.7% 0.6% Saudi Arabia Emerging 5.2% 0.5% Serbia Emerging 28.9% 0.1% South Africa Emerging 14.2% 0.8% Suriname Emerging 16.0% 1.1% Thailand Emerging 57.6% 2.8% Turkey Emerging 44.6% 2.4% Ukraine Emerging 14.0% -0.7% United Arab Emirates Emerging 1.6% -3.9% Uruguay Emerging 25.2% 2.2% Venezuela Emerging 32.6% -0.5%

Source: Calculation by author. Data: ILO, World Employment and Social Outlook - Trends 2015, Datasets. Figure 7: Productivity growth versus perceptions of political and informal institutions

Country Development status (ILO definition)

Annual growth in output per worker (USD), average 1996 to 2013, PPP adjusted

Voice and accountability index, average 1996 to 2013

Corruption index, average 1996 to 2013

Australia Advanced 1.3% 1.5 2.0 Austria Advanced 1.0% 1.4 1.9 Belgium Advanced 0.6% 1.4 1.4 Denmark Advanced 0.9% 1.5 2.0 Estonia Advanced 2.0% 0.9 0.3 Finland Advanced 0.9% 1.6 2.4 France Advanced 4.3% 1.0 0.8 Germany Advanced 1.3% 1.6 2.4 Greece Advanced 0.6% 1.2 1.4 Hong Kong, China Advanced 0.7% 1.4 1.8 Hungary Advanced 1.6% 0.9 0.3 Iceland Advanced 2.2% 0.4 1.8 Ireland Advanced 1.6% 1.0 0.5 Israel Advanced 1.5% 1.5 2.1 Italy Advanced 1.7% 1.4 1.6 Japan Advanced 0.6% 0.6 1.0

Country Development status (ILO definition)

Annual growth in output per worker (USD), average 1996 to 2013, PPP adjusted

Voice and accountability index, average 1996 to 2013

Corruption index, average 1996 to 2013

Korea, Republic of Advanced -0.2% 1.0 0.3 Lithuania Advanced 0.8% 1.0 1.3 Luxembourg Advanced 3.0% 0.7 0.4 Macau, China Advanced 4.4% 0.9 0.2 Malta Advanced 1.2% 1.5 2.0 Netherlands Advanced 5.1% 0.3 0.5 New Zealand Advanced 1.3% 1.2 0.9 Norway Advanced 0.6% 1.6 2.1 Portugal Advanced 1.0% 1.6 2.3 Singapore Advanced 0.8% 1.6 2.1 Slovakia Advanced 1.0% 1.3 1.1 Slovenia Advanced 2.0% -0.1 2.2 Spain Advanced 3.1% 0.9 0.2 Sweden Advanced 2.0% 1.1 0.9 Switzerland Advanced 0.4% 1.2 1.1 United Kingdom Advanced 1.6% 1.6 2.3 United States Advanced 0.8% 1.6 2.1 Canada Advanced 1.2% 1.3 1.9 Czech Republic Advanced 1.6% 1.2 1.5 Afghanistan Developing 3.8% -1.4 -1.6 Albania Developing 4.4% -0.1 -0.7 Algeria Developing -0.4% -1.0 -0.6 Angola Developing 4.9% -1.2 -1.3 Armenia Developing 5.9% -0.6 -0.6 Azerbaijan Developing 7.9% -1.1 -1.1 Bahamas Developing -0.5% 1.0 1.4 Bangladesh Developing 3.4% -0.4 -1.1 Barbados Developing 0.3% 1.2 1.4 Belize Developing 0.3% 0.7 -0.2 Benin Developing 0.9% 0.2 -0.7 Bhutan Developing 2.8% -0.8 0.7 Bolivia Developing 1.1% 0.0 -0.6 Bosnia and Herzegovina Developing 4.9% -0.1 -0.3

Botswana Developing 1.7% 0.6 0.9 Burkina Faso Developing 2.7% -0.4 -0.2 Cambodia Developing 3.8% -0.9 -1.1 Cameroon Developing 0.5% -1.1 -1.1 Chad Developing 3.7% -1.3 -1.2 Comoros Developing -0.8% -0.5 -0.8 Congo Developing 0.7% -1.6 -1.5 Congo, Democratic Republic of Developing 0.1% -1.1 -1.1

Côte d'Ivoire Developing -0.3% -1.1 -0.9 Cuba Developing 3.0% -1.7 0.3 Cyprus Developing 0.2% 1.0 1.2 Dominican Republic Developing 2.9% 0.1 -0.6 Ecuador Developing 0.8% -0.3 -0.8 Egypt Developing 1.9% -1.0 -0.5 El Salvador Developing 0.5% 0.0 -0.4 Equatorial Guinea Developing 13.2% -1.8 -1.5 Eritrea Developing -2.5% -1.9 -0.2 Ethiopia Developing 3.5% -1.2 -0.7 Fiji Developing 0.7% -0.4 -0.3 Gabon Developing -0.5% -0.8 -0.7 Gambia Developing 0.6% -1.0 -0.6 Georgia Developing 5.8% -0.2 -0.4 Ghana Developing 2.9% 0.2 -0.1 Guatemala Developing 0.2% -0.3 -0.6 Guinea Developing 0.4% -1.2 -0.9 Guinea-Bissau Developing -2.6% -0.9 -1.1 Guyana Developing 1.4% 0.2 -0.5 Haiti Developing -1.2% -0.9 -1.3

Country Development status (ILO definition)

Annual growth in output per worker (USD), average 1996 to 2013, PPP adjusted

Voice and accountability index, average 1996 to 2013

Corruption index, average 1996 to 2013

Honduras Developing 0.8% -0.3 -0.9 Iran, Islamic Republic of Developing 0.6% -1.3 -0.6

Iraq Developing 0.6% -1.5 -1.4 Jamaica Developing 0.0% 0.5 -0.4 Jordan Developing 1.4% -0.6 0.2 Kyrgyzstan Developing 2.5% -0.9 -1.0 Lao People's Democratic Republic Developing 4.0% -1.5 -1.1

Lebanon Developing -0.3% -0.4 -0.7 Lesotho Developing 2.6% -0.1 -0.1 Liberia Developing 9.4% -0.7 -0.9 Libya Developing -1.8% -1.7 -1.0 Madagascar Developing -0.5% -0.3 -0.2 Malawi Developing 0.7% -0.3 -0.5 Malaysia Developing 1.8% -0.4 0.3 Maldives Developing 1.0% -0.5 -0.4 Mali Developing 0.5% 0.1 -0.5 Mauritania Developing 0.4% -0.9 -0.4 Mongolia Developing 3.9% 0.2 -0.5 Montenegro Developing Morocco Developing 1.9% -0.6 -0.2 Mozambique Developing 4.5% -0.1 -0.5 Myanmar Developing 6.8% -2.0 -1.5 Namibia Developing 1.6% 0.4 0.3 Nepal Developing 1.8% -0.6 -0.6 Nicaragua Developing 0.7% -0.3 -0.7 Niger Developing 0.3% -0.6 -0.8 Nigeria Developing 3.7% -0.8 -1.1 Pakistan Developing 0.4% -1.0 -0.9 Panama Developing 2.9% 0.5 -0.3 Papua New Guinea Developing 0.1% 0.0 -1.0 Paraguay Developing 0.5% -0.3 -1.1 Peru Developing 2.0% -0.1 -0.3 Philippines Developing 2.0% 0.0 -0.6 Rwanda Developing 3.5% -1.3 -0.2 Senegal Developing 0.9% 0.0 -0.3 Sierra Leone Developing 2.7% -0.5 -0.9 Solomon Islands Developing -1.0% -2.0 -1.7 Sri Lanka Developing 3.7% -0.4 -0.2 Sudan Developing 0.8% -1.7 -1.3 Swaziland Developing -0.2% -1.3 -0.3 Taiwan, China Developing 2.7% 0.8 0.7 Tajikistan Developing 3.8% -1.3 -1.1 Tanzania, United Republic of Developing 3.0% -0.3 -0.7

Togo Developing -0.3% -1.2 -0.9 Trinidad and Tobago Developing 2.2% 0.5 -0.1 Tunisia Developing 2.1% -0.8 0.0 Turkmenistan Developing 4.7% -2.0 -1.3 Uganda Developing 3.2% -0.6 -0.9 Uzbekistan Developing 3.6% -1.9 -1.1 Viet Nam Developing 4.0% -1.4 -0.6 West Bank and Gaza Strip Developing 1.5% -0.9 -0.8

Yemen Developing -0.7% -1.1 -0.9 Zambia Developing 1.9% -0.3 -0.7 Zimbabwe Developing -3.9% -1.4 -1.2 Burundi Developing 1.0% 0.3 -0.4 Brunei Darussalam Emerging 6.5% -1.5 -0.7 Argentina Emerging 0.8% 0.4 0.0 Belarus Emerging -1.1% -0.8 0.5 Brazil Emerging 3.5% 0.5 -0.2

Country Development status (ILO definition)

Annual growth in output per worker (USD), average 1996 to 2013, PPP adjusted

Voice and accountability index, average 1996 to 2013

Corruption index, average 1996 to 2013

Bulgaria Emerging -0.4% -1.1 -1.1 Chile Emerging 1.4% 1.0 1.4 China Emerging 7.9% -1.5 -0.5 Colombia Emerging 0.2% -0.3 -0.3 Costa Rica Emerging 1.5% 1.0 0.6 Croatia Emerging 2.9% 0.4 -0.1 India Emerging 4.8% 0.4 -0.4 Indonesia Emerging 2.1% -0.3 -0.8 Kazakhstan Emerging 4.7% -1.1 -1.0 Kenya Emerging 0.7% -0.4 -1.0 Kuwait Emerging -0.6% -0.4 0.6 Latvia Emerging 4.6% 0.7 0.1 Mauritius Emerging 2.9% 0.9 0.5 Mexico Emerging 0.5% 0.1 -0.3 Oman Emerging -0.4% -0.9 0.3 Poland Emerging 3.2% 1.0 0.4 Puerto Rico Emerging 0.9% 1.0 0.7 Qatar Emerging 1.2% -0.7 0.9 Romania Emerging 2.8% 0.4 -0.3 Russian Federation Emerging 3.0% -0.7 -0.9 Saudi Arabia Emerging 0.7% -1.6 -0.2 Serbia Emerging 3.3% -0.1 -0.5 South Africa Emerging 1.8% 0.7 0.3 Suriname Emerging 1.5% 0.3 -0.1 Thailand Emerging 1.5% -0.2 -0.2 Turkey Emerging 2.3% -0.2 -0.1 Ukraine Emerging 3.1% -0.3 -0.9 United Arab Emirates Emerging -4.4% -0.8 0.9 Uruguay Emerging 1.9% 1.0 1.0 Venezuela Emerging -0.2% -0.6 -1.0

Source: Calculation by author. Data: ILO, World Employment and Social Outlook - Trends 2015, Datasets; World Bank - The Worldwide Governance Indicators 2014

Figure 8: Informality versus regulatory quality

Country Development status (ILO definition)

% of labour force in vulnerable employment, average 2010 to 2013

Distance to frontier score, average 2010 to 2013

Australia Advanced 8.5% 81 Austria Advanced 8.8% 77 Belgium Advanced 10.3% 74 Canada Advanced 10.1% 81 Czech Republic Advanced 14.5% 67 Denmark Advanced 5.6% 85 Estonia Advanced 5.1% 76 Finland Advanced 9.4% 82 France Advanced 7.1% 71 Germany Advanced 6.8% 80 Greece Advanced 29.2% 61 Hong Kong, China Advanced 6.7% 90 Hungary Advanced 6.5% 67 Iceland Advanced 8.8% 82 Ireland Advanced 12.0% 82 Israel Advanced 8.0% 72 Italy Advanced 18.3% 66 Japan Advanced 9.7% 78 Korea, Republic of Advanced 22.0% 83 Lithuania Advanced 8.9% 74 Luxembourg Advanced 5.7% 66 Malta Advanced 10.2% 62 Netherlands Advanced 11.6% 76 New Zealand Advanced 11.3% 89

Country Development status (ILO definition)

% of labour force in vulnerable employment, average 2010 to 2013

Distance to frontier score, average 2010 to 2013

Norway Advanced 5.3% 83 Portugal Advanced 16.7% 74 Singapore Advanced 9.2% 92 Slovakia Advanced 12.4% 70 Slovenia Advanced 13.3% 67 Spain Advanced 12.0% 72 Sweden Advanced 6.9% 83 Switzerland Advanced 9.2% 76 United Kingdom Advanced 11.9% 84 United States Advanced 6.4% 86 Afghanistan Developing 73.5% 40 Albania Developing 58.4% 61 Angola Developing 53.3% 40 Armenia Developing 41.9% 64 Azerbaijan Developing 56.6% 63 Bahamas Developing 14.2% 65 Bangladesh Developing 80.7% 48 Barbados Developing 16.3% 62 Belize Developing 24.0% 61 Benin Developing 89.7% 41 Bolivia Developing 54.2% 50 Bosnia and Herzegovina Developing 25.9% 55 Botswana Developing 15.1% 65 Burkina Faso Developing 90.4% 44 Cambodia Developing 66.6% 50 Cameroon Developing 75.5% 46 Chad Developing 90.2% 31 Comoros Developing 87.7% 46 Congo Developing 74.6% 35 Congo, Democratic Republic of Developing 79.3% 37 Côte d'Ivoire Developing 77.0% 43 Cyprus Developing 13.6% 68 Dominican Republic Developing 44.1% 62 Ecuador Developing 41.8% 57 Egypt Developing 23.7% 57 El Salvador Developing 39.9% 59 Equatorial Guinea Developing 26.8% 47 Eritrea Developing 67.1% 33 Ethiopia Developing 88.9% 50 Fiji Developing 41.6% 68 Gabon Developing 31.2% 50 Gambia Developing 71.1% 50 Georgia Developing 60.8% 78 Ghana Developing 73.8% 64 Guatemala Developing 43.7% 62 Guinea Developing 95.1% 38 Guinea-Bissau Developing 87.2% 38 Guyana Developing 47.4% 58 Haiti Developing 55.9% 43 Honduras Developing 51.9% 59 Iran, Islamic Republic of Developing 40.0% 54 Iraq Developing 15.8% 51 Jamaica Developing 37.3% 64 Jordan Developing 9.6% 58 Kyrgyzstan Developing 39.2% 61 Lao People's Democratic Republic Developing 84.4% 47 Lebanon Developing 33.4% 62 Lesotho Developing 17.1% 52 Liberia Developing 77.0% 45 Libya Developing 7.3% 34 Madagascar Developing 89.6% 47 Malawi Developing 89.7% 49

Country Development status (ILO definition)

% of labour force in vulnerable employment, average 2010 to 2013

Distance to frontier score, average 2010 to 2013

Malaysia Developing 21.3% 77 Maldives Developing 21.7% 65 Mali Developing 89.8% 48 Mauritania Developing 65.5% 43 Mongolia Developing 53.5% 60 Montenegro Developing 34.5% 66 Morocco Developing 41.4% 62 Mozambique Developing 85.6% 52 Myanmar Developing 89.4% 42 Nepal Developing 70.2% 60 Nicaragua Developing 43.5% 56 Niger Developing 94.9% 42 Nigeria Developing 80.6% 43 Pakistan Developing 62.1% 57 Panama Developing 29.6% 66 Papua New Guinea Developing 77.1% 57 Paraguay Developing 41.9% 61 Peru Developing 47.4% 69 Philippines Developing 42.9% 55 Rwanda Developing 81.3% 61 Senegal Developing 72.6% 43 Sierra Leone Developing 89.7% 45 Solomon Islands Developing 77.8% 59 Sri Lanka Developing 41.9% 58 Sudan Developing 76.6% 50 Swaziland Developing 18.9% 58 Taiwan, China Developing 17.1% 76 Tajikistan Developing 47.8% 44 Tanzania, United Republic of Developing 83.0% 55 Togo Developing 86.3% 41 Trinidad and Tobago Developing 15.9% 63 Tunisia Developing 24.8% 68 Uganda Developing 81.3% 50 Uzbekistan Developing 33.0% 44 Viet Nam Developing 63.3% 60 West Bank and Gaza Strip Developing 26.6% 51 Yemen Developing 39.4% 57 Zambia Developing 76.3% 58 Zimbabwe Developing 66.5% 42 Argentina Emerging 19.1% 57 Belarus Emerging 2.2% 60 Brazil Emerging 25.0% 53 Brunei Darussalam Emerging 4.8% 60 Bulgaria Emerging 8.5% 69 Burundi Emerging 92.2% 40 Chile Emerging 21.9% 70 China Emerging 44.2% 59 Colombia Emerging 48.6% 68 Costa Rica Emerging 20.5% 58 Croatia Emerging 16.9% 62 India Emerging 79.1% 52 Indonesia Emerging 37.5% 58 Kazakhstan Emerging 29.9% 61 Kenya Emerging 58.3% 57 Kuwait Emerging 2.4% 62 Latvia Emerging 7.5% 74 Mauritius Emerging 16.3% 75 Mexico Emerging 29.0% 68 Oman Emerging 4.5% 67 Poland Emerging 18.2% 66 Puerto Rico Emerging 13.8% 71 Qatar Emerging 0.2% 69 Romania Emerging 31.8% 64 Russian Federation Emerging 5.8% 56

Country Development status (ILO definition)

% of labour force in vulnerable employment, average 2010 to 2013

Distance to frontier score, average 2010 to 2013

Saudi Arabia Emerging 3.7% 73 Serbia Emerging 29.6% 60 South Africa Emerging 9.9% 70 Suriname Emerging 15.7% 44 Thailand Emerging 54.0% 76 Turkey Emerging 32.7% 67 Ukraine Emerging 18.0% 45 United Arab Emirates Emerging 0.9% 72 Uruguay Emerging 23.0% 61 Venezuela Emerging 32.5% 38

Source: Calculation by author. Data: ILO, World Employment and Social Outlook - Trends 2015, Datasets; World Bank – Doing Business Indicators 2014, Datasets.

Figure 9: Growth in informality versus regulatory quality

Country Development status (ILO definition)

Annual growth in % of labour force in vulnerable employment, average 2010 to 2013

Distance to frontier score, average 2010 to 2013

Australia Advanced -0.1% 81 Austria Advanced 0.0% 77 Belgium Advanced 0.2% 74 Canada Advanced 0.3% 81 Czech Republic Advanced 0.1% 67 Denmark Advanced 0.0% 85 Estonia Advanced 0.1% 76 Finland Advanced 0.0% 82 France Advanced 0.0% 71 Germany Advanced -0.1% 80 Greece Advanced 0.6% 61 Hong Kong, China Advanced 0.2% 90 Hungary Advanced -0.2% 67 Iceland Advanced 0.0% 82 Ireland Advanced 0.2% 82 Israel Advanced -0.1% 72 Italy Advanced -0.2% 66 Japan Advanced -0.2% 78 Korea, Republic of Advanced -0.2% 83 Lithuania Advanced 0.2% 74 Luxembourg Advanced 0.3% 66 Malta Advanced 0.0% 62 Netherlands Advanced 0.3% 76 New Zealand Advanced -0.3% 89 Norway Advanced -0.1% 83 Portugal Advanced -0.3% 74 Singapore Advanced -0.1% 92 Slovakia Advanced 0.0% 70 Slovenia Advanced 0.0% 67 Spain Advanced 0.4% 72 Sweden Advanced -0.1% 83 Switzerland Advanced 0.0% 76 United Kingdom Advanced 0.2% 84 United States Advanced 0.0% 86 Afghanistan Developing -1.0% 40 Albania Developing 0.9% 61 Angola Developing 0.0% 40 Armenia Developing 0.1% 64 Azerbaijan Developing 0.1% 63 Bahamas Developing 0.0% 65 Bangladesh Developing -0.4% 48 Barbados Developing 0.0% 62 Belize Developing 0.0% 61 Benin Developing -0.1% 41

Country Development status (ILO definition)

Annual growth in % of labour force in vulnerable employment, average 2010 to 2013

Distance to frontier score, average 2010 to 2013

Bolivia Developing -0.5% 50 Bosnia and Herzegovina Developing -0.3% 55 Botswana Developing -0.1% 65 Burkina Faso Developing -0.2% 44 Cambodia Developing -1.6% 50 Cameroon Developing -0.2% 46 Chad Developing 0.0% 31 Comoros Developing 0.1% 46 Congo Developing 0.0% 35 Congo, Democratic Republic of Developing -0.3% 37

Côte d'Ivoire Developing -0.3% 43 Cyprus Developing 0.0% 68 Dominican Republic Developing -0.9% 62 Ecuador Developing -0.5% 57 Egypt Developing 0.8% 57 El Salvador Developing 0.0% 59 Equatorial Guinea Developing 0.0% 47 Eritrea Developing -0.1% 33 Ethiopia Developing 0.2% 50 Fiji Developing 0.0% 68 Gabon Developing -0.3% 50 Gambia Developing -0.9% 50 Georgia Developing -0.2% 78 Ghana Developing -1.1% 64 Guatemala Developing 1.7% 62 Guinea Developing 0.0% 38 Guinea-Bissau Developing -0.1% 38 Guyana Developing -0.7% 58 Haiti Developing -0.2% 43 Honduras Developing -0.3% 59 Iran, Islamic Republic of Developing -0.1% 54 Iraq Developing -0.3% 51 Jamaica Developing 0.2% 64 Jordan Developing 0.0% 58 Kyrgyzstan Developing 1.4% 61 Lao People's Democratic Republic Developing -0.5% 47

Lebanon Developing -0.4% 62 Lesotho Developing -0.1% 52 Liberia Developing -1.0% 45 Libya Developing 0.0% 34 Madagascar Developing 0.4% 47 Malawi Developing 0.0% 49 Malaysia Developing 0.1% 77 Maldives Developing 0.4% 65 Mali Developing 0.2% 48 Mauritania Developing -0.1% 43 Mongolia Developing -1.4% 60 Montenegro Developing 0.0% 66 Morocco Developing -0.6% 62 Mozambique Developing -0.4% 52 Myanmar Developing -0.3% 42 Nepal Developing -0.2% 60 Nicaragua Developing -0.6% 56 Niger Developing -0.2% 42 Nigeria Developing -0.6% 43 Pakistan Developing -0.2% 57 Panama Developing -0.6% 66 Papua New Guinea Developing -0.7% 57 Paraguay Developing -1.1% 61 Peru Developing 0.0% 69 Philippines Developing -0.5% 55

Country Development status (ILO definition)

Annual growth in % of labour force in vulnerable employment, average 2010 to 2013

Distance to frontier score, average 2010 to 2013

Rwanda Developing -0.2% 61 Senegal Developing -0.2% 43 Sierra Leone Developing -0.8% 45 Solomon Islands Developing -0.8% 59 Sri Lanka Developing 0.3% 58 Sudan Developing 0.4% 50 Swaziland Developing 0.1% 58 Taiwan, China Developing -0.5% 76 Tajikistan Developing 0.4% 44 Tanzania, United Republic of Developing -1.3% 55 Togo Developing -0.2% 41 Trinidad and Tobago Developing -0.2% 63 Tunisia Developing -2.0% 68 Uganda Developing -0.3% 50 Uzbekistan Developing -0.4% 44 Viet Nam Developing -0.4% 60 West Bank and Gaza Strip Developing -0.1% 51 Yemen Developing 0.1% 57 Zambia Developing -0.1% 58 Zimbabwe Developing -0.5% 42 Argentina Emerging 0.0% 57 Belarus Emerging 0.0% 60 Brazil Emerging -0.4% 53 Brunei Darussalam Emerging 0.0% 60 Bulgaria Emerging -0.2% 69 Burundi Emerging 0.0% 40 Chile Emerging 0.4% 70 China Emerging -0.9% 59 Colombia Emerging -0.2% 68 Costa Rica Emerging 0.1% 58 Croatia Emerging -0.7% 62 India Emerging -0.7% 52 Indonesia Emerging -0.6% 58 Kazakhstan Emerging -0.6% 61 Kenya Emerging 0.7% 57 Kuwait Emerging 0.0% 62 Latvia Emerging 0.0% 74 Mauritius Emerging 0.3% 75 Mexico Emerging -0.3% 68 Oman Emerging -0.1% 67 Poland Emerging -0.3% 66 Puerto Rico Emerging 0.1% 71 Qatar Emerging 0.0% 69 Romania Emerging -0.6% 64 Russian Federation Emerging 0.1% 56 Saudi Arabia Emerging 0.0% 73 Serbia Emerging -0.7% 60 South Africa Emerging -0.2% 70 Suriname Emerging 0.0% 44 Thailand Emerging 0.8% 76 Turkey Emerging -0.7% 67 Ukraine Emerging 0.1% 45 United Arab Emirates Emerging -0.1% 72 Uruguay Emerging -0.3% 61 Venezuela Emerging -0.1% 38

Source: Calculation by author. Data: ILO, World Employment and Social Outlook - Trends 2015, Datasets; World Bank – Doing Business Indicators 2014, Datasets.

Figure 16: Transition towards a formal institutional system and impact on social security and enforcement

Country Development status (ILO definition)

Output per worker (USD), average 2000 to 2013, PPP adjusted

Average total public social expenditure as a percentage of GDP, average 2000 to 2013

Rule of law index, average 2000 to 2013

Australia Advanced $79,243 17.8% 1.7 Austria Advanced $84,375 27.5% 1.9 Belgium Advanced $96,083 28.2% 1.3 Denmark Advanced $78,380 17.8% 1.7 Estonia Advanced $51,726 20.1% 0.9 Finland Advanced $83,409 29.2% 1.9 France Advanced $46,239 17.2% 0.9 Germany Advanced $79,337 28.0% 1.9 Greece Advanced $88,398 31.3% 1.4 Hong Kong, China Advanced $81,437 26.5% 1.6 Hungary Advanced $70,518 22.6% 0.7 Iceland Advanced $85,420 4.6% 1.4 Ireland Advanced $54,636 22.4% 0.8 Israel Advanced $67,660 16.9% 1.8 Italy Advanced $99,599 20.1% 1.6 Japan Advanced $75,087 16.0% 0.9 Korea, Republic of Advanced $90,655 26.4% 0.5 Lithuania Advanced $68,342 20.2% 1.3 Luxembourg Advanced $57,062 8.0% 0.9 Macau, China Advanced $44,320 15.4% 0.6 Malta Advanced $204,875 22.3% 1.8 Netherlands Advanced $137,541 0.6 New Zealand Advanced $67,493 18.4% 1.4 Norway Advanced $81,746 22.4% 1.8 Portugal Advanced $61,160 20.4% 1.8 Singapore Advanced $120,902 21.8% 1.9 Slovakia Advanced $53,713 24.0% 1.1 Slovenia Advanced $120,789 2.0% 1.6 Spain Advanced $49,640 17.9% 0.4 Sweden Advanced $56,558 23.0% 1.0 Switzerland Advanced $78,009 24.5% 1.2 United Kingdom Advanced $80,201 28.3% 1.9 United States Advanced $90,159 19.4% 1.8 Canada Advanced $72,667 22.4% 1.7 Czech Republic Developing $100,936 18.3% 1.5 Afghanistan Developing $6,033 3.4% -1.8 Albania Developing $19,960 10.5% -0.8 Algeria Developing $46,304 8.5% -0.8 Angola Developing $16,322 6.8% -1.4 Armenia Developing $15,260 6.3% -0.4 Azerbaijan Developing $23,659 7.6% -0.9 Bahamas Developing $50,040 4.4% 1.0 Bangladesh Developing $4,086 1.9% -0.9 Barbados Developing $29,905 9.7% 1.2 Belize Developing $22,479 5.0% -0.2 Benin Developing $4,033 3.4% -0.5 Bhutan Developing $11,534 5.0% 0.2 Bolivia Developing $11,398 10.4% -0.8 Bosnia and Herzegovina Developing $30,321 15.0% -0.5

Botswana Developing $31,314 6.4% 0.6 Burkina Faso Developing $2,991 5.3% -0.5 Cambodia Developing $4,039 1.5% -1.1 Cameroon Developing $6,612 2.0% -1.1 Chad Developing $4,770 1.8% -1.4 Comoros Developing $5,043 2.4% -1.1 Congo Developing $13,495 2.6% -1.7 Congo, Democratic Republic of Developing $1,641 13.5% -1.3

Côte d'Ivoire Developing $7,363 20.7% -1.3 Cuba Developing $35,670 19.9% -0.8 Cyprus Developing $47,578 19.1% 1.0 Dominican Republic Developing $24,192 4.8% -0.6

Country Development status (ILO definition)

Output per worker (USD), average 2000 to 2013, PPP adjusted

Average total public social expenditure as a percentage of GDP, average 2000 to 2013

Rule of law index, average 2000 to 2013

Ecuador Developing $19,487 2.9% -0.9 Egypt Developing $32,374 11.7% -0.1 El Salvador Developing $18,795 7.9% -0.7 Equatorial Guinea Developing $62,887 3.3% -1.3 Eritrea Developing $2,931 1.7% -0.9 Ethiopia Developing $1,995 4.2% -0.8 Fiji Developing $20,767 2.9% -0.4 Gabon Developing $59,580 -0.5 Gambia Developing $4,024 2.8% -0.3 Georgia Developing $11,340 7.8% -0.6 Ghana Developing $7,009 5.0% -0.1 Guatemala Developing $18,205 4.5% -1.1 Guinea Developing $3,019 1.7% -1.4 Guinea-Bissau Developing $3,179 4.2% -1.4 Guyana Developing $15,905 8.6% -0.5 Haiti Developing $4,355 -1.5 Honduras Developing $11,019 3.7% -0.9 Iran, Islamic Republic of Developing $47,090 11.0% -0.8

Iraq Developing $59,231 11.9% -1.6 Jamaica Developing $21,020 4.2% -0.4 Jordan Developing $42,407 11.3% 0.3 Kyrgyzstan Developing $6,312 6.5% -1.1 Lao People's Democratic Republic Developing $7,016 1.5% -1.0

Lebanon Developing $43,209 1.8% -0.5 Lesotho Developing $6,890 5.8% -0.2 Liberia Developing $1,826 12.1% -1.4 Libya Developing $81,606 4.5% -1.0 Madagascar Developing $2,998 2.8% -0.5 Malawi Developing $1,603 6.1% -0.3 Malaysia Developing $45,405 2.9% 0.5 Maldives Developing $24,901 6.0% 0.0 Mali Developing $5,368 4.9% -0.4 Mauritania Developing $9,123 4.0% -0.7 Mongolia Developing $14,247 12.4% -0.2 Montenegro Developing $36,971 Morocco Developing $18,128 5.9% -0.1 Mozambique Developing $2,137 4.7% -0.7 Myanmar Developing $1,994 0.6% -1.5 Namibia Developing $26,728 5.6% 0.2 Nepal Developing $3,586 2.1% -0.7 Nicaragua Developing $10,544 6.3% -0.7 Niger Developing $2,639 3.0% -0.7 Nigeria Developing $14,758 3.7% -1.2 Pakistan Developing $12,733 0.7% -0.8 Panama Developing $31,284 5.5% -0.2 Papua New Guinea Developing $4,598 3.4% -0.9 Paraguay Developing $15,095 5.4% -1.0 Peru Developing $17,663 6.4% -0.6 Philippines Developing $13,422 1.2% -0.4 Rwanda Developing $2,303 5.3% -0.8 Senegal Developing $5,412 4.6% -0.2 Sierra Leone Developing $3,415 4.2% -1.1 Solomon Islands Developing $4,553 6.8% -0.7 Sri Lanka Developing $16,698 3.8% 0.1 Sudan Developing $14,069 2.2% -1.4 Swaziland Developing $24,285 5.2% -0.6 Taiwan, China Developing $54,974 0.9 Tajikistan Developing $4,969 4.8% -1.2 Tanzania, United Republic of Developing $2,775 4.1% -0.4

Togo Developing $2,934 4.6% -0.9

Country Development status (ILO definition)

Output per worker (USD), average 2000 to 2013, PPP adjusted

Average total public social expenditure as a percentage of GDP, average 2000 to 2013

Rule of law index, average 2000 to 2013

Trinidad and Tobago Developing $56,212 6.4% 0.0 Tunisia Developing $30,309 8.7% 0.0 Turkmenistan Developing $22,016 -1.4 Uganda Developing $2,914 3.9% -0.5 Uzbekistan Emerging $9,701 12.2% -1.3 Viet Nam Emerging $6,632 5.1% -0.4 West Bank and Gaza Strip Emerging $21,686 -0.4

Yemen Emerging $18,739 2.3% -1.2 Zambia Emerging $6,899 5.0% -0.5 Zimbabwe Emerging $3,851 4.7% -1.6 Burundi Emerging $27,268 17.6% -0.6 Brunei Darussalam Emerging $27,941 17.3% -1.1 Argentina Emerging $26,997 19.2% -0.3 Belarus Emerging $160,825 2.7% 0.6 Brazil Emerging $33,424 16.8% -0.2 Bulgaria Emerging $1,721 4.7% -1.3 Chile Emerging $44,333 10.7% 1.3 China Emerging $12,385 5.2% -0.4 Colombia Emerging $24,451 9.7% -0.6 Costa Rica Emerging $26,689 1.9% 0.5 Croatia Emerging $49,631 0.0 India Emerging $9,971 2.0% 0.1 Indonesia Emerging $16,297 2.6% -0.7 Kazakhstan Emerging $34,557 6.9% -0.9 Kenya Emerging $5,725 2.7% -0.9 Kuwait Emerging $178,215 9.5% 0.6 Latvia Emerging $40,737 14.3% 0.6 Mauritius Emerging $33,731 8.2% 0.9 Mexico Emerging $38,380 7.2% -0.5 Oman Emerging $118,217 3.5% 0.6 Poland Emerging $45,410 20.8% 0.6 Puerto Rico Emerging $112,826 0.8 Qatar Emerging $189,678 2.1% 0.7 Romania Emerging $31,134 0.0% -0.1 Russian Federation Emerging $39,086 14.4% -0.9 Saudi Arabia Emerging $130,122 3.7% 0.2 Serbia Emerging $21,755 0.0% -0.7 South Africa Emerging $38,492 8.9% 0.1 Suriname Emerging $36,696 -0.2 Thailand Advanced $20,064 4.9% 0.1 Turkey Advanced $50,234 11.4% 0.0 Ukraine Advanced $15,940 21.6% -0.8 United Arab Emirates Advanced $142,847 3.8% 0.5 Uruguay Advanced $31,393 17.3% 0.5 Venezuela Advanced $38,444 6.9% -1.4

Source: Calculation by author. Data: ILO, World Employment and Social Outlook - Trends 2015, Datasets; World Bank - The Worldwide Governance Indicators 2014, Datasets; ILO, Social Protection Datasets – 2015.

Bibliography

Ahrens, J. “Toward a Post-Washington Consensus: The Importance of Governance Structures in Less Developed Countries and Economies in Transition” (1998). Published by: University of Göttingen, Department of Economics.

Alemeida, R; Caneriro, P. “Enforcement of Regulation, Informal Labor and Firm Performance” (2005). Forschungsinstitut zur Zukunft der Arbeit Institute for the Study of Labor, Discussion Paper No. 1759.

Bangasser, P. “The ILO and the informal sector: an institutional history” (2009). Published by: International Labour Organisation.

Barwa, S. “Structural adjustment programmes and the urban informal sector in Ghana” (1995). Published by: International Labour Organisation, Development and Technical Cooperation Department.

Bolio, E; Remes, J; Lajous, T; Manyika, J; Rossé; Ramirez, E.“A tale of two Mexicos: Growth and prosperity in a two-speed economy” 2014. Published by: McKinsey Institute.

Chant, S; Mcllwaine, C. “Geographies of Development in the 21st Century: An Introduction to the Global South” (2009). Published by: Edward Elgar Publishing Limited.

Chant, Sylvia, McIlwaine, Cathy and Evans, Sally Lloyd (2001) Making a living: employment, livelihoods and the informal sector. In: McIlwaine, Cathy and Willis, Katie, (eds.) Challenges and Change in Middle America: Perspectives on Development in Mexico, Central America and the Caribbean. DARG regional development series (no. 2). Pearson Education, Harlow, pp. 110-135.

Charmes, J. “The Informal Economy Worldwide: Trends and Characteristics” (2012). In: Margin—The Journal of Applied Economic Research 6 : 2.

Chen, M. “The Informal Economy: Definitions, Theories and Policies” (2012). WIEGO Working Paper. Published by WIEGO.

Craig, D; Porter, D. “Development Beyond Neoliberalism? Governance, Poverty Reduction and Political Economy” (2006). In: ‘Local Institutions for poverty reduction? 1997-2005’, p 95-121.

De Soto, H. “The Mystery of Capital – Why Capitalism Triumphs in the West and Fails Everywhere Else” (2000). Published by: Basic Books.

Di John, J; Putzel, J. “Political Settlements: Issues Paper” (2009). Published by: Governance and Social Development Resources Centre.

Erickson, L. “Informality, Firm Size and Economic Growth: Testing the De Soto Hypothesis” (2002). Published by: Brown University.

Farell, d. “The hidden dangers of the informal economy” (2004). Published by: The McKinsey Global Institute.

Fields, G (2004), 'Dualism in the Labor Market: A Perspective on the Lewis Model After Half a Century, Cornell University

Fields, G. “Dualism in the Labor Market: A Perspective on the Lewis Model After Half a Century” (2004). Published by: Cornell University.

Fields, G. “Employment in Low-Income Countries: Beyond Labor Market Segmentation?” (2006). Published by: Cornell University.

Fields, G. “Informality: It’s Time to Stop Being Alice-in-Wonderland-ish” (2011). Published by: Cornell University and IZA.

Guha-Ksnobis. B; Kanbur, R; Ostrom, E. “Beyond formality and informality” (2006). Edited by Guha-Khasnobis, B; Kanbur, R; Ostrom, E. “Linking the Formal and Informal Economy: Concepts and Policies” (2006). Published by: Oxford University Press.

Harriss-White B. (2010) “Work and wellbeing in informal economies: the regulative roles of institutions of identity and the state” (2010). In: World Development Vol. 38, No. 2, pp. 170–183, 2010. Published by: Elsevier.

Hart, K. “Bureaucratic form and the informal economy” (2006). Edited by Guha-Khasnobis, B; Kanbur, R; Ostrom, E. “Linking the Formal and Informal Economy: Concepts and Policies” (2006). Published by: Oxford University Press.

Henry, S. “The Political Economy of Informal Economies” (1987). In: Annals of the American Academy of Political and Social Science,Vol. 493, The Informal Economy (Sep., 1987).

Hosseini, H. “Arthur Lewis’ Dualism', the Literature of Development Economics and the Less Developed Economies” (2012). In: Review of European Studies; Vol. 4, No. 4; 2012. Published by: International Labour Organisation.

Hussmanns, R. “Defining and measuring informal employment” (2004). Published by: International Labour Organisation.

International Labour Organisation. “Skills for improved productivity, employment growth and development” (2008). Published by: International Labour Organisation.

International Labour Organisation. “Women and Men in the Informal Economy: A Statistical Picture” (2013). Published by: International Labour Organisation.

Kapsos, S; Torres, R; Bonnet, F; Horne, R. “World Employment Social Outlook: Changing Nature of Jobs” (2015). Published by: International Labour Organisation.

Kapsos, S. “World of Work Report: 2014, Developing with Jobs” (2014). Published by: International Labour Organisation

Khan, M. “Governance and Development: The Perspective of Growth-enhancing Governance” (2008). In: Diversity and Complementarity in Development Aid: East Asian Lessons for African Growth. Tokyo: GRIPS Development Forum/National Graduate Institute for Policy Studies, pp. 107-152.

Khan, M. “Political Settlements and Governance of Growth-Enhancing Institutions” (2010). Published by: School of Oriental and African Studies,

Kucera D, Roncolato, L. “Informal employment: Two contested policy issues” (2008). In: International Labour Review, Vol. 147 (2008), No. 4. Published by: International Labour Organisation.

La Porta, R; Shleifer, A. “Informality and Development” (2014). In “Journal of Economic Perspectives – Volume 28, Number 3 – Summer 2014 – Pages 109-126” (2014).

Loayza, N; Oviedo, M; Serven, L. “The Impact of Regulations on Growth and Informality: Cross-Country Evidence” (2006). Edited by Guha-Khasnobis, B; Kanbur, R; Ostrom, E.

“Linking the Formal and Informal Economy: Concepts and Policies” (2006). Published by: Oxford University Press.

Marquez, A. “The Other Path by Hernando De Soto: Review” (1990). Published by: Boston College Third World Law Journal.

Maurizio, R. “Labour informality and poverty in Latin America: the case of Argentina, Brazil, Chile and Peru”. (2015). Edited by Cling, JP; Lagrée, S; Razafindrakoto, M; Roubaud, F. “The Informal Economy in Developing Countries” (2015). Published by: Routledge.

Müller-Falcke, D. “Informal Sector Enterprises in the Light of New Institutional Economics” (1997). Published by: Göttingen : International Department, Institute of Small Business.

North, D. “Institutions, Institutional Change and Economic Performance” (1990). Published by: Cambridge University Press.

Perry, G; Maloney, W; Arias, O; Fajnzylber, P; Mason, A; Saavedra-Canduvi, J. “Informality: exit and exclusion” (2007). Published by: World Bank Latin American and Caribbean studies

Rada, C; Taylor, L. “Developing and Transition Economies in the Late 20th Century: Diverging Growth Rates, Economic Structures, and Sources of Demand” (2006). Published by: United Nations Department of Economic and Social Affairs (DESA).

Scarpetta, S; & Tressel, T. "Boosting productivity via innovation and adoption of new technologies : any role for labor market institutions?" (2004). Policy Research Working Paper Series 3273, The World Bank.

Schneider, F; Buehn, A; Montenegro, C. “Shadow Economies All over the World: New Estimates for 162 Countries from 1999 to 2007” (2010). Published by: The World Bank - Development Research Group, Poverty and Inequality Team.

Sindzingre, A. “The Relevance of the Concept of Formality and Informality: A Theoretical Appraisal” (2006). Edited by Guha-Khasnobis, B; Kanbur, R; Ostrom, E. “Linking the Formal and Informal Economy: Concepts and Policies” (2006). Published by: Oxford University Press.

Stiglitz, J. “Towards a New Paradigm for Development: Strategies, Policies, and Process” (1998). Lecture given at the 1998 Prebisch Lecture at UNCTAD.

Vanek, J; Chen, M; Carré, F; Heintz, J; Hussmanns, R. “Statistics on the Informal Economy: Definitions, Regional Estimates & Challenges (2014). Published by: Women in Informal Employment Globalizing and Organizing (WIEGO).

World Bank. “World Development Report 2002 – Building institutions for markets” (2001). Published by: World Bank.

World Bank. “World Development Report 2013 – Jobs” (2012). Published by: World Bank.2012.

The International Politics of Global Cities

Jose Ferrando Alemany

Abstract With the increasing urbanisation of world’s population, cities as governmental entities are progressively boosting their share of power to govern people’s life. However, the abundant literature about local politics is shaded by the lack of research about the role of cities at the international level. Cities, notably the so-called global cities, are emerging as indispensable for the world’s system to the extent that they concentrate massive flows of information, population and finance. However, it is not clear whether they are intentionally influencing international politics or if they are purposely undermining the traditional role of states in that matter. Seeking to explore the real impact that these cities have, this paper is analysing the role of global cities as actors and places for action in international politics from a point of view between Sociology and International Relations.

1. Introduction In 2009, for the first time in history, the world’s urban population surpassed the number of people living in rural areas; current predictions point out that around 2050, more than 70% of the global population will inhabit cities (Lefevre, 2015: 14). Consequently, the role of cities in the future to come cannot be dismissed, but instead studied and dissected in order to better understand how these agglomerations will impact our lives.

The first cities continuously inhabited until present times were founded circa 4,000 BC, flourishing around the globe regardless of the region they were in. Since their early stages, cities became economic, political and population centres whose growth made them control such a vast territory that they became essential to understand human social life (Kotkin, 2006). However, not all cities had the same span of influence: Tyre and Venice for instance became powerful enough to be states for a time, while cities like Rome accumulated so much power that they became empires on their own; some cities became essential to the empires and states they were in (Seville, Beijing, London); while other cities have come and go without having any major impact over the world. In this context, the aim of this paper is to understand to what extent one particular type of urban agglomeration, the global city, influences international politics. To do so, we will analyse the position of cities as both international unitary actors and spaces where citizens and world governance intersect, interact, and influence each other. By focusing on global cities as a tool of intercontinental analysis, we can address global issues through the scope of the spaces where they materialise: built urban environments. Looking for the explanation as to how global cities are influencing international politics, I will first define and characterise global cities, eventually stepping away from the traditional economic definition and including the political one: cities recognised as global because of their influence in international politics, and not just because of their role as hubs for transnational economy. I will draw upon secondary data about global cities in distinct fields to explore the issue and highlight the importance of global cities for international politics. Secondly, I will delimitate the relationship between global cities, the states they are in, and the international system as a whole to finally posit that global cities are increasing their impact in global politics because they are taking advantage of a particular niche for action as both unitary actors and places for action and interaction. To illustrate these arguments I will analyse the role of global cities in international politics through two examples: (1) the role of cities as unitary actors through the case study of Tokyo and its strategy for city diplomacy; and (2) the role of cities as locus of action and interaction for transnational protesters, concretely the Occupy Movement in the city of New York. I will finally conclude that global cities, as international actors, are still embedded within their states and an international system built for states. Their influence on international politics is therefore biased by the systemic inter-state system, but yet, they do influence politics in the supra-national sphere. Global cities, without intentionally challenging their territorial states, are slowly becoming international actors in their own right, creating a particular niche for action where they are both the stage of the play and a secondary actor.

2. Global Cities: between international politics and economy

‘The combination of spatial dispersals and global integration has created a new strategic role for major cities. Beyond their long history

as centres for international trade and banking, these cities now function in four new ways: (1) as highly concentrated command points in the organisation of the world’s economy; (2) as key locations for finance and for specialised service firms, which have replaced manufacturing as the leading economic sectors; (3) as sites of production, including the production of innovations, in these leading industries; (4) as markets for the products and innovations produced. (…) These cities concentrate control over vast resources, while finance and specialised service industries have restructured the urban social and economic order. Thus a new type of city has appeared. It is the global city.’

(Sassen, 1991: 3-4)

Global cities, as Sassen points out, are those urban agglomerations that, because of their characteristics, are found in the intersection between global trends and local environments. But for a city to be considered global, it has to fulfil a set of characteristics. According to John Friedman, one of the pioneers in theorising world cities4, the criteria marking the global status of a city are: (1) the city is a major financial centre; (2) it has regional or global headquarters for transnational corporations; (3) it accommodates international institutions; (4) the city records a rapid growth of the business and service sectors; (5) it is an important manufacturing centre; (6) it is a major transportation node; and (7) it has a considerable population size compared to the rest of the cities in the world. Friedman’s world city hypothesis states that because of their global character, these cities are vigorously styled by fluctuations in economy, politics and migration at the international level (Friedman, 1986: 25; 70-79).

In other words, mixing Sassen and Friedman’s approaches, a world city is an urban area with a large population, bringing together a set of high-ranking economic and transportation flows, as well as the headquarters and offices of multinational corporations and international institutions.

Global cities are hence a space of flows, at the same time receivers and transmitters of information, interconnecting with other cities following world system dynamics. Drawing upon this perspective, a World System analysis in Wallerstein’s terms is consequently the best paradigm to analyse the role of global cities in an international system whose politics is built for states which, although trying to difficult the actions cities as unitary actors, cannot fully control them. This type of analysis sees the globe as a whole where the unit of analysis is not the nation-state but the system per se, allowing us to explore the roles that minor not-recognised or non-fully legitimate actors –such as global cities- play in the international system and its components (Wallerstein, 2004: 17). In this sense, integrating cities as part of the global system helps us to reflect on their importance as nodal points of the system where the exchange of information becomes capital in order to relate to each other: global cities will not be global if they lack privileged high-profile information streaming through them. The consideration of Castell’s Network Society, an informational society where social –international- actors are informational nodes of communication, will then help us to understand the world city within the global system as a non-place where flows of information are managed and redirected (Castells, 2000: 696).

With the world city hypothesis, Friedman put cities on the boundary between the local and the global for the first time, depicting the urban environment as the crossroad of both forces, implying a two-way interaction between them. Although this mutual influence is extensive to

4 In this dissertation the terms global city and world city will be used with the same meaning.

all aspects of social life, it particularly stands out in the fact that global cities perform ideological and control functions as part of their role as a juncture between the territorial nation-state and the rest of the world (Friedman, 1986; King, 1990: 26-32). This means that these cities, although mostly judged under economic standards, are capital in politics –both national and international- because of their role in constructing, interpreting and transmitting the ideological rationality driving both systems. Consequently, even though economic prosperity is often the factor measured to determine cities’ growth and share of power at the international level (King, 1983; Sassen, 1991), several global cities have based their current development upon harnessing advantages other than the economic one; for instance, encouraging a prominent role in international affairs to relocate the local environment into a more beneficial position in the global context (UN-Habitat, 2013: 108). Historically it has been trade which has popularised a city’s name in international circles, but the role of the economy in constructing the global part of a global city has been slightly overrated. For instance, the fixation in calibrating the level of internationalisation of a city through economy might be a result of it being easier to measure –for instance through trade and financial movements- rather than calculating the centrality of the city in international politics –which a priori seems more complicated to quantify and compare. Hence, despite economy being a major aspect to take into account when defining a city as global, it is certainly not the only aspect that has to be considered. For instance, Detroit in the twentieth century illustrates how a city with a powerful economy can have a global reach and be part of the global economic gear assembly, lacking however any other characteristics making it global. But it also shows us how this lack of other globalising factors made it lose its international stance once the prosperity of the economic sector dried out in the 2000s (McDonald, 2014; GaWC, 2014). Washington DC makes the other side of the coin, a city that made it to the upper flight of the global ladder thanks to its specialisation in politics while scoring as a rather mediocre economic centre for multinational corporations (GaWC, 2014).

Table 1: Alpha World Cities in 2012 Alpha ++ 9 Sydney 18 Los Angeles 27 Vienna 37 Barcelona

1 London 10 Dubai 19 Madrid 28 San Francisco 38 Bangkok

2 New York Alpha 20 Mexico City 29 Istanbul 39 Boston

Alpha + 11 Chicago 21 Amsterdam 30 Jakarta 40 Dublin

3 Hong Kong 12 Mumbai 22 Kuala Lumpur 31 Zurich 41 Taipei

4 Paris 13 Milan 23 Brussels 32 Warsaw 42 Munich

5 Singapore 14 Moscow Alpha - 33 Washington DC 43 Stockholm

6 Shanghai 15 Sao Paulo 24 Seoul 34 Melbourne 44 Prague

7 Tokyo 16 Frankfurt 25 Johannesburg 35 New Delhi 45 Atlanta

8 Beijing 17 Toronto 26 Buenos Aires 36 Miami Source: GaWC, 2014.

According to the Globalisation and World Cities Research Network, GaWC, 182 cities were included in the category of global cities at the end of 2012, while forty one additional cities showed evidence of being a world city in formation. Amongst them, major differences are

palpable in terms of the span of their interconnectivity, reason for which there are three sub-categories: alpha world cities, considered as fully functional at the international level –see Table 1; beta world cities, regarded as major for the global system; and gamma world cities, weighed as minor global cities. However, as we are suggesting, not all cities become global because of the same factors. For instance, as we can see in Table 2, Brussels is the eleventh city in the world in terms of importance for multinational corporations, which may be explained by two factors: either the city is an important economic centre or it is an influential decision-making location. However, while in terms of trade Brussels remains a secondary city in the European regional system (Huang and Wu, 2007: 74-75), at the political level it houses the headquarters of most of the European Union institutions; in other words, Brussels’ high importance for multinational corporations is due to the regional political importance of the city, not because of its position as a trade node in the international economy.

Table 2: Multinational Corporations presence in Global Cities5 City No. Offices City No. Offices

1 London 368 11 Brussels 187

2 New York 357 12 Sydney 186

3 Hong Kong 253 13 Madrid 182

4 Tokyo 244 14 Toronto 182

5 Paris 235 15 Amsterdam 180

6 Singapore 229 16 Sao Paulo 168

7 Chicago 213 17 San Francisco 164

8 Los Angeles 201 18 Zurich 157

9 Frankfurt 193 19 Washington 154

10 Milan 191 20 Mexico City 148 Source: Taylor and Catalano, 2000.

In this same sense, cities like Beijing, Washington or Moscow share a disparity between their positions in both rankings. While all three are important decision-making centres and capitals of important state actors at the international level, there is a clear gap between their individual importance for major multinational corporations and their overall relevance for the world system. Examining the market value of cities –see Table 3- leads us to conclude that which makes a city global is not a purely economic factor: six of the cities appearing in the ranking are not even characterised as alpha global cities by GaWC. Although the market value of a city is a very narrow factor to generalise from it, the conclusions are similar when examining other economic factors such as intensity of the financial market or distribution of global service firms (Sassen, 1994; GaWC, 2015).

5 Relevance of a city for a firm’s office network amongst 100 global service corporations offering advanced producer services in at least 15 cities.

Table 3: Global Command and Control Centres

City Market Value (Billion US$)

City Market Value (Billion US$)

1 New York 2,680,072 11 Houston 667,020

2 Beijing 1,862,450 12 Seoul 662,429

3 London 1,830,063 13 Moscow 594,610

4 Tokyo 1,750,169 14 Seattle 498,810

5 San Jose 1,366,580 15 Toronto 447,750

6 Paris 1,249,746 16 Atlanta 418,710

7 San Francisco 853,070 17 Zurich 390,930

8 Hong Kong 807,196 18 Minneapolis 388,550

9 Dallas 770,355 19 Rio de Janeiro 369,080

10 Chicago 705,950 20 Sao Paulo 369,080 Source: Csomós, 2012.

This evidence shows, on the one hand, how economy at the global level is organised around a small number of cities, which dominate the system by housing the leading offices of the main transnational corporations and financial institutions (Abrahamson, 2004: 4; Clark, 1996: 9); and on the other hand, how other factors in addition to economic ones have an impact over each city’s influence and reach.

Notwithstanding, despite the fluctuation of positions that some cities experiment in each ranking depending on the dimension we decide to consider, there are some names that are omnipresent in all rankings, embodying what a global city is, or rather what it should be: New York, London, Tokyo and Paris are invariably at the apex, the core of international networks, regardless of the criterion chosen to emphasise the global span of a city (Abrahamson, 2004: 4; Sassen, 1991).

Focusing on cities as units of analysis to research about international politics presents however a twofold problem. On the one hand, and as we will further develop in the following chapter, International Relations scholarship has traditionally focused on the realist axiom that states are the only legitimate actors at the international level (Mearsheimer, 1995: 9-12). Cities are relegated not to a second level analysis, which could be made of international non-state actors like individuals, multinational corporations and transnational organisations, but rather to a largely non-existent third level where they are considered as a constitutive part of the state, and therefore unable to act on their own.

At this point is when the second problem arises: even examining cities as actors, mainstream literature on global cities focuses on their economic dimension, which we have seen it does not exhaust all their possible facets, hence creating a vacuum of knowledge about the role of cities in international politics. Consequently, some authors have tried to reclaim the role of the global city as a category including the economic approach but also supplementary dimensions:

‘The term global city may be reductive and misleading if it suggests that cities are mere outcomes of a global economic machine. They are specific places whose spaces, internal dynamics, and social structure

matter; indeed, we may be able to understand the global order only by analysing why key structures of the world economy are necessarily situated in cities.’

(Sassen, 1991: 3-4) From their role as ‘basing points between international production and global markets’ (Abrahamson, 2004: 11), world cities have developed as core nodes of the international system, as the key articulation between the globe and the citizens. Cities do not depend anymore on their hinterland, but are instead the enactment of a global-to-local hierarchy whose scope of control is extended well beyond their traditional sphere of influence (Lee and Pelizzon, 1991: 44). Hence, global cities become attractive to international politics not because of their economic muscle, but because of their success in centralising resources and flows of population and information. Global cities have become the proverbial Promised Land for international politics and every sector needing coordination in a planetary scope. Concretely, international politics demand for centralisation of certain resources is accompanied in global cities by a broad flow of high-profile information, allowing a qualitative increase in the city’s interconnectivity. Additionally, these global cities attract a big volume of highly-skilled population, either as permanent migrants or as temporal workers and students (Abrahamson, 2004: 6). By fulfilling international politics needs and demands, cities mature into world cities as the perfect scenario to make globalisation6 possible. But in the opposite sense, cities have also set trends in the international system. In fact, some authors even consider that the current political international geography has been a consequence of the economic order that emerged in urban Europe and North America during the nineteenth century (Clark, 1996: 86; Kotkin, 2006: 98).

Even though understanding the global city as a place ‘where certain kinds of work can get done’ (Sassen, 1991: 5) is understanding the city as a pole of attraction for international politics, in truth it is states and a restricted number of inter-state organisations who have the final say on international matters. This statism has impregnated scholarship in a way that nowadays in academic circles only the nation-state is considered as an appropriate tool of analysis to understand global politics as a system. However, the crucial nodes providing the current world system of its characteristic interconnectivity are not states, but cities (Abrahamson, 2004: 2; 167-168; Sassen, 1991: 127).

The relation between city and state has yet to be analysed, as it is not as straightforward as to say that cities are the actors who made globalisation possible, leaving nation-states’ role unrecognised. Cities role in international politics has to be understood as a continuous but indirect challenge to the establishment, since they have to find a way to interact in a world system that is not organised for them, but for nation-states. However, by doing so cities do not pretend to diminish states power, but create their own way to interact legitimately within the system. At this point global cities can be understood in two separate ways: (1) cities can be considered as actors in their own, like states or international organisations. As fully capable actors, they should be able to participate in the international system without the intermediation of any other institution7, although their effective power in the international scene has to be weighted in relation to their economic and political might and the systemic constraints they have to face in the exact same sense that although all states are considered theoretically equal, in practice 6 Understood here as the wide-world increasing interconnectedness at the economic, cultural, political, and informational level (Giddens and Sutton, 2013: 127-149). 7 In the broader sense, including states.

they are not; and (2) cities can be considered as places where international politics happen, being therefore the node where citizenship and abstract global politics intersect. This dimension has two ways of being represented constructed upon a cleavage between traditional politics and non-traditional politics; in other words, cities are the locus to enact official politics, conducted by multilevel government officials, as well as unofficial politics, characteristically portrayed by street demonstrations as well as by civil national and transnational associations (Denemark, 1999: 44-50; Perulli, 2012).

3. Global Cities as Unitary Actors: the nation-states’ resistance The problem of considering world cities as unitary actors is that the international system is mainly designated for state actors. Literature on the topic has even taken with scepticism the legitimacy of international –id est inter-state- organisations, especially according to realism, which has been until now the most popular theory guiding scholar literature and statespersons’ practice in international relations (Mearsheimer, 1995: 9-12; Donnelly, 2001: 29-54; Sassen, 1991: 168-169; 189-190). Despite this context, the fast urbanisation of the contemporary world and the exodus of rural population towards the cities (Clark, 1996:98; UN-Habitat, 2013: x) has in a certain way outdated the necessity of a national state so individuals can relate with the international system. For instance, 108 out of the 196 countries recognised by the UN8 have less than ten million inhabitants, while fifteen of the alpha global cities exceed this population. In fact, the combined population of alpha global cities exceeds 400 million inhabitants, which might not seem that much globally –it accounts for less than a fourteenth part of global population- but is in truth approximately the combined population of 149 out of 250 countries and dependencies officially listed by the UN DESA9 (2015; Taylor et al, 2010). Furthermore, cities are the level of government that lies closer to the population itself: while states have their influence over their citizens mediated by intermediary governmental strata and regulations, cities and citizens participate in a direct reciprocal contact relation. This not only means that cities regulate citizens in the most direct possible way, but also that the latter feel that local government is close enough as to influence it individually in the same sense that cities and the international system mutually influence each other –as explained in the preceding chapter. This situation is exacerbated in global cities because due to their economic, political, cultural and demographic potentialities, they have a heavier influence over citizens than smaller less powerful cities (Friedman, 1986: 70-79; King, 1990: 26-32; Sassen, 1991: 3-4). In the same way that global cities closely govern over large portions of the global population, they also have a big share of the global economy and have become hubs of international networks concerning technological innovation and academic research (Sassen, 1991; Lee and Pelizzon, 1991; Clark, 1996). The combination of these dynamics has created a certain tension between states and world cities in terms of legitimacy to the extent that world cities see their share of power vastly increase in proportion to the amount of influence over international politics enjoyed by territorial state they are in, asking therefore for more independence in their actions. However, states are trying to preserve the grip they have over these cities, reproducing the current inter-state status quo that dominates the international sphere.

8 United Nations. 9 UN Department of Economic and Social Affairs.

Additionally, cities are highly dependent on the states they are located in because of the historical territorial organisation around supra-local entities:

‘Cities cannot survive without the support of a stable, viable political system (…) It is in the primary interest of officials to establish public order in cities, to secure acceptance of the state’s authority among urban populations and to maintain durable and adequately-financed institutions of local governance.’

(Gurr and King, 1987: 29-30) This puts the tension between city and state in certain perspective, since cities’ influence over international politics cannot be understood without the historic role of a comprehensive state supporting their development from below. Global cities are global because a favourable national organisation allowed them to thrive (Hohenberg and Lees, 1995: 247; Imusil, 2013). The relation between world cities and their states is hence more complex than an altercation between a city that wants to be a legitimate actor in international politics and a state that bars it from reaching this privilege. However, states do not seem inclined to cede part of their sovereignty to cities, and they continue to be at the core of the international system, painting the canvas of international politics at their discretion. Consequently, the status quo will predictably be maintained for the foreseeable future (Clark, 1996: 7). On the other hand, world cities have demonstrated that they are capable of forcing the state to adopt certain policies they would have not agreed with otherwise. But also they have shown that cities are capable of relating to each other without acting through the states in which they are contained (Sassen, 1991: 168-169; Clark, 1996: 159-160; Abrahamson, 2004: 166-170). Thus, global cities are not completely contained within their territorial states, which causes borders, boundaries and national sovereignty to blur when cities interact with and within the international system.

An analysis of global cities through the world system scope has to consider that some parts of the system will be central to it, while other parts will be rather marginalised or abused by the system. The international state-centric structure is built theoretically considering all nations as equals, while in praxis some countries are stronger than others –economically, politically, etc. Therefore, these core countries are able to make the rules and make a certain amount of surplus-value flow from the periphery of the system towards the core. The immediate thought that follows is that some states will have a larger impact over international politics than others (Wallerstein, 2004: 12).

MAP 1: Global Cities interconnectivity within the World System in 2010

Red stands for alpha global cities and their interconnections, green stands for beta cities, and blue for gamma ones. Source: GaWC, 2010.

Extrapolating this logic to global cities, because of the volume and importance of the resources they manage, some cities will be more influential over international politics than others, and even more than some states, despite global cities being formally inferior to states in the international system (Friedman, 2000: 22-23; Smith and Timberlake, 200: 88). Global cities are centres of economic, political, and knowledge flows, privileged nodes of information exchange within the world-system, but not part of the systemic core on their own because they are not considered legitimate international actors and therefore cannot act by themselves in this arena. However, their importance is too big to be considered as just peripheral actors, since some of these cities account for more political influence, or even more economic might, than some third world countries. For instance, New York’s GDP in 2014 accounted for 1,403 US$ millions, making it the fifteenth largest economy in the world, roughly the same size as Spain (BEA, 2013; WB, 2014; Brookings, 2014). Thus, we have to consider applying to these cities the concept of semi-periphery: those areas of the world-system that are not centre, either periphery, but that behave as both at the same time; the semi-periphery acts as centre regarding the periphery of the world-system, but as periphery regarding the centre (Wallerstein, 2004: 29). The semi-peripheral position held by global cities in the world system makes them too economically strong and politically influential to be considered as part of the periphery, but they cannot be considered as core per se simply because they are not states. However, as Saskia Sassen adequately points out:

‘With rare exceptions, studies of cities assume that the nation-state is the unit of analysis and that urban systems are coterminous with nation-states. (…) The interactions amongst New York, London, and Tokyo, particularly in terms of finance and investment, suggest the possibility that they constitute a system. These cities do not compete with each other for the same business. There is an economic system that rests on the three distinct types of locations these cities represent.’

(Sassen, 1991: 168-169)

This means that world cities, despite their dependence on states, can and do act as actors on their own and relate to each other and with the system in general without necessarily using inter-state channels. This new niche for action and interaction ensures that global cities have their own space in the international system despite the establishment pushing them to act through traditional means. Cities are indeed mediated by nation-states, but not all their horizontal relations need to pass through national politics. There are city-to-city flows that get their structure from this new niche, not openly challenging the present world-system, but reshaping the global order by introducing a semi-peripheral actor: the global city. This position is accompanied by a set of significant transnational roles because of their position in a trans-urban system that indirectly challenges the traditional nature of national territorial borders (Knox, 2000: 9-12; Smith and Timberlake, 2000: 80-81).

As we can see in Table 4, global cities need for states is corroborated by the fact that the twenty top cities with more diplomatic activity are basically national capitals, with the notorious exception of Hong Kong –which attained this status because of its traditional role of articulation between East Asia and the Western world as a British colony in mainland China- and New York –whose intense activity is due to housing the United Nations headquarters.

Table 4: Diplomatic Network Connectivity Pos. City Pos. City

1 Washington D.C. 11 Hong Kong

2 Tokyo 12 Stockholm

3 London 13 Buenos Aires

4 Paris 14 Vienna

5 Ottawa 15 Canberra

6 New York 16 Copenhagen

7 Berlin 17 Moscow

8 Rome 18 Athens

9 Brussels 19 Santiago

10 Beijing 20 Tel Aviv Source: Taylor, 2004.

In fact, if we cross-reference this table with the alpha global cities –see Table 1- most of them are not only national capitals, but they are also mainly located in Western countries, part of the systemic core (Wallerstein, 2004). The consequence of this data is twofold: (1) it is undeniable that global cities have prospered as such because they have been, in a certain way, driven by the state they are in; and (2) that most of these cities are in countries at the systemic core, but are not core per se, hence their role in the semi-periphery. The state is being shaped from the local level, while world cities and an aggregation of global city-regions become influential actors in the international system (Taylor, 2000: 57-58; Perulli, 2012). In fact, as we can see in Table 5, the ranking of cities according to the international organisations connectivity in their metropolitan areas responds to a more decentralised system where even cities that are peripheral to the global economic and labour

system –for instance Harare and Dakar- become core for transnational politics system to the extent that they are important nodes for the political network.

Table 5: International Organisations Presence Pos. City Pos. City

1 Nairobi 11 New York

2 Brussels 12 Mexico City

3 Bangkok 13 Jakarta

4 London 14 Tokyo

5 New Delhi 15 Accra

6 Manila 16 Cairo

7 Washington D.C. 17 Dhaka

8 Harare 18 Rome

9 Geneva 19 Dakar

10 Moscow 20 Santiago de Chile Source: Taylor, 2003.

In the current world system, the data we have analysed shows how global cities’ competitive advantage lies in controlling global flows of money, information and decision-making processes, sometimes separately and sometimes altogether. However, as we will further develop in the study case about Tokyo’s city diplomacy, world cities have not reached a point where they can overthrow states authority and act independently. Global cities are using a shortcut to the international level that avoids state channels, creating in the process a new niche for action, but they are not challenging the power or the position of the state. In any case, the reality is that global cities as a unitary actor in international politics are relatively weak and dependent on states, even if at a global scale it is undeniable that cities are increasing their overall influence and have the power to interact amongst them.

In this sense, cities can also influence international politics as places where decisions are taken, where transnational networks converge, and where civic protests physically materialise as popular demonstrations against supra-national entities.

4. Global Cities as Places for Action and Interaction It is extensively assumed that some non-state actors have an increasing influence over the development of certain international activities. For this reason, we have explored the potentialities of global cities as actors in international politics. Nevertheless, their influence is not exhausted with this role, since cities also have an impact on the basis of being the place where international institutions are based, decisions are taken and knowledge is spread; in other words, world cities act as physical nexus of transnational cultural, political and economic information (Simon, 2000: 139; Knox, 2000: 7).

On the one hand, the global dimension of a world city is abstract, mainly because international politics per se do not happen in a concrete observable location, but at the

intangible international arena. Although this place is non-existent physically, it concentrates networks and institutions present in several buildings and locations disseminated around the world. Hence, global cities turn into the locus where the omnipresent but placeless international politics are staged mainly because they are the place where its actors are based. On the other hand, international politics, because of its intrinsic global span, needs of adequate informational flows to spread the information fast enough. Information and interpersonal contact streams need of a centralised bunch of world-wide nodes facilitating extensive coordination. Hence, being world cities global nodes for networks and information, they become fundamental pivotal places for information to rebound and depart in every possible direction, reaching the global span that they intrinsically need. Consequently, world cities become global to the extent that they concentrate the actors and information necessary to the functioning of international politics. Although it is argued that the extension of immediate means of communication could have ended with world cities’ monopoly as base of operations for politics, there has not been a delocalisation of resources in these places:

‘With the diffusion of electronically based communication technologies, territorial contiguity ceased to be a precondition for the simultaneity of interactive social practices. But the death of distance is not the end of the spatial dimension of society. The space of places, based in meaningful physical proximity, continues to be a major source of experience and function for many people and in many circumstances. (…) [In this context], a new form of space emerges, the space of flows.’

(Castells, 2000: 696) Cities become space and non-space –what Castells calls space of flows- to the extent that they are undeniably physical, and house physical processes for international politics, but at the same time are embedded into a transnational net of information that tangentially makes them lose part of this spatiality. Because of the intangibility of flows, they do not have a corporeal place in the global city, where rather than stocked up this flows are absorbed or redirected towards other destinations: they are managed within the non-spatial dimension of the city, the place where the city is not a location but a matrix of information streams; the place where the city is an abstract space of flowing information. Global cities are here represented in international politics by the interactions taking place inside it. Hence, the global city becomes a ‘reflexive and self-reflexive structure’ (Perulli, 2012), an urban environment built up mirroring the nodal intersection of networks present in the city, producing and reproducing the observed patterns of international information reception and emission:

‘The space of flows is made of bits and pieces of places, connected by telecommunications, fast transportation, and information systems, and marked by symbols and spaces of intermediation (such as airports, international hotels, business centres), symbolized by delocalized architecture.’

(Castells, 2000: 696)

World cities, and the networks they host, transcend the bounded urban space to relate with other pieces of the system into a gigantic worldwide net, not only as unitary actors but as spaces for action as well. Nevertheless, international politics needs of individual actors that impersonate the networks that conform it; therefore, global cities can be seen as necessary in

the development of international politics in both the traditional way – id est housing international organisations, under the command of states- or through less traditional channels –for instance, being a transnational activism base of operations.

On Table 6, we have listed some of the networking communications channelled through world cities that are essential for the daily functioning of international politics:

Table 6: Conceptualising inter-city linkages, a typology

Function Form

Human Material Information

Economic

Labour

Managers Lawyers

Consultants

Capital Commodities

Business Phone Calls

Faxes Telex messages

Technology transfers Advertisements

Political Troops Diplomats

Social Workers

Military Hardware

Foreign Aid

Treaties

Political Threats

Cultural

Exchange Students

Dance Troupes Rock Concerts

Theatre

Painting Sculpture

Artefacts

Feature films Videos

CDs

Social reproduction

Families

Red Cross Community Organisers

Remittances Foreign Aid

Post Cards Night Phone Calls

Source: Smith and Timberlake, 2000: 86.

Although quite complete, this typology ignores a non-traditional way in which international politics works: the role of transnational activists and movements, which is nowadays an essential part of the information and networking torrents that flow through world cities. However, in addition to being a node for these streams, global cities are also the place where activism is shaped at its global form. In this case the global city is particularly attractive because (1) it allows a direct protest towards government, since cities are the governmental stratum that is closest to population; and (2) its role as space of flows, with global spanning incomes and outcomes, makes it perfect to reach a higher impact and even facilitate the movement’s expansion around the world. Consequently, world cities as built environments shape the reality of their citizens and influence activism: they create and reproduce certain patterns of behaviour amongst their citizens to the extent that their global characteristics make them attractive for a certain type of activism. For instance, since the 1980s the worldwide adoption of economic neo-liberalism has led to an intensifying social fragmentation, exacerbating urban internal displacement provoked by economic polarisation, de facto transforming each neighbourhood into a ghetto where belonging is dictated by the family’s earnings and lifestyle. Concretely, the different

trends of international economy have created in global cities (1) a spatial differentiation based on the economic resources gap of the population; (2) the economic inequality has assumed distinct forms in the consumption patterns, hence concentrating in the same municipality opposite lifestyles; and (3) there has been an increase of the casual and informal labour markets, particularly underground economy (Sassen, 1991: 249-283).

The concentration of people with such divergent backgrounds in such a restricted space transforms the city into a time-bomb for social conflict, which periodically explodes through heterogeneous groups of social activists. However, what is new in this kind of activism is that despite the local allegiances of each protest, most of them are targeting their malcontent towards international institutions –like the 1999 protests in Seattle against the Ministerial Conference of the World Trade Organisation (Burton, 2014)- or towards global economic trends –for instance the Occupy Movement protests against the 2008 economic crisis (OWS, 2011).

These activists share common struggles and the inclination to use the urban public space as the stage to represent their resentment with the political arrangements that affect them. This has been additionally spurred by the conception of the public space ideal that generally reigns in the Global North, considering the city and their spaces as locus for democracy, openness, and publicity of debate. Although it is true that in cities in the Global South this conception is less extended, it is also legitimate consider that similar values have been allocated to urban spaces based on historical as well as recent examples of street demonstration in these countries –for instance the Yellow Umbrella Movement in Hong Kong, 2014; or the People’s Uprising rally in Kuala Lumpur, 2013- (Rizzo and Galanakis, 2015: 37). The connectivity of global cities helps to extend the span of these locally-based movements to other cities, as we will further develop in our second case study concerning the Occupy Movement. In fact, because of their global character, world cities are disproportionally affected by global struggles that create, mutatis mutandis, the same social issues across all world cities regardless of their national belonging. Citizens in New York, London, Kuala-Lumpur and Shanghai share partially similar problems; consequently, urban activism in global cities will be particularly prone to be trans-nationalised, or rather trans-urbanised, not only because of the extension of immediate means of communication, but also because the shared burden global cities bear creates some sort of solidarity and identification between movements in different parts of the world. In this sense, when influencing the international system, global cities have a symbolic power à la Bourdieu10: the city as a place has a passive but decisive role in international politics because it concentrates the physical space where decisions are taken, information is spread, and social contestation is originated. Hence, influence on international politics through the non-traditional channel of urban activism is attained thanks to, on the one hand, the role of the city as a hub of networks and population affected by problems with a global span, and on the other hand, as a result of the trans-urbanisation of movements across global cities.

This activism does not purposely challenge the state-centrism status quo of the system, but is notwithstanding blurring traditional state-to-state boundaries, changing the major rule prevailing in the international Westphalian system. Even if this type of activism does not target the state, it is relating to the international system shortcutting the traditional way through the state, thence threatening the state establishment in international politics with its mere existence.

10 See bibliography.

5. Case Studies Until now we have represented global cities’ role in international politics as twofold: (1) global cities as unitary actors; and (2) global cities as place for interaction and activism. As means to illustrate these positions, I am going to analyse firstly the diplomacy strategy that the city of Tokyo has been following since March 2015; and secondly, the Occupy Movement as a locally originated form of activism that later on evolved into a trans-national and trans-urban organisation.

5.1. Tokyo’s Strategy for City Diplomacy Tokyo, capital of Japan, is the global city par excellence: it concentrates around thirty-two million inhabitants in its metropolitan area; the city’s GDP is the twelfth largest economy in the world, between Canada and Australia; and it houses the offices of main multinational corporations and dozens of international organisations and NGOs, making its urban diplomatic connectivity the second in the world11 (Taylor et al, 2010; WB, 2014; Brookings, 2014; UNDESA, 2015). Hence, the fact that Tokyo is also a pioneer in establishing city-level diplomacy, reclaiming de facto the capacity to act as a unitary actor in international politics, shouldn’t be a surprise either. Mr Yoichi Masuzoe, governor of Tokyo, has summarised the key principles for city diplomacy as follows:

ü The TMG12 shall strategically implement city diplomacy as an effective means to realize policies that will contribute to Tokyo’s advancement.

ü City diplomacy shall be a TMG-wide endeavour undertaken comprehensively and it must aim at improving the lives of the residents of Tokyo and ensuring that the benefits gained will be returned to them.

ü The TMG’s city diplomacy shall be conducted in cooperation and collaboration with the central government, and it shall aim at contributing to the international community.

(Masuzoe, 2015)

Tokyo’s city diplomacy has been constructed as combining two opposite tendencies: while on the one hand it is trying to make the city a fully legitimate actor in international politics, in this case through diplomacy, on the other hand, the local diplomacy is presented as a collaboration task with central government, subdued to state interests. In other words, the strategy seeks to give a voice for Tokyo in international matters while placing that voice below the voice of the city’s territorial state, in this case Japan. In an interview aired on 30 March 2015 on the programme News Room Tokyo, Masuzoe reasserted the terms of Tokyo’s diplomacy as a part of the national Japanese foreign policy. Although it seems that Tokyo’s city diplomacy was initially intended to have other objectives –possibly it was a combined exercise of public diplomacy and place branding before the 2020 Olympic and Paralympic games13- it has proved useful at smoothing negotiations and contacts at the inter-state level, as the own metropolitan governor admitted: ‘City diplomacy is paving

11 Also see tables 1, 2, 3, 4 and 5. 12 Tokyo Metropolitan Government. 13 The promotion of Tokyo abroad before the Olympic Games is one of the key objectives of the strategy (Masuzoe, 2015).

the way for national diplomacy. I did not do it intentionally. It was a by-product of our city diplomacy efforts’ (NRT, 2015). Since the TMG issued in December 2015 their basic strategy for city diplomacy, Mr Masuzoe has visited eight major cities in the first ten months of his mandate, including London, Moscow, Berlin, Beijing, Seoul, Sochi, Incheon and Tomsk (Miyajima, 2015). These visits illustrate how Tokyoite diplomacy has been focused exclusively towards an inter-urban diplomacy, and not city-to-state, as the Tokyo Metropolitan Government had announced before:

‘The TMG, in its promotion of city diplomacy, will strive to review and revitalize such relations [of Tokyo with other cities], and aggressively implement city-to-city diplomacy as well as a multilateral version of city diplomacy both within Japan and overseas.’

(TMG, 2015)

These activities and governmental declarations have positioned Tokyo’s city diplomacy outside of the state-to-state relations that prevail at the international level while at the same time supporting it. Maintaining the global aspect of the city in the inter-urban system makes the so-called diplomacy of the local government an exercise of city publicity rather than an attempt to elevate the city it to the rank of international actor. Thence Tokyo, as an international unitary actor, continues to be dependent on its territorial state, and the boost given to the city by its diplomacy strategy has not sought in any moment to substitute it. However, a certain aspect of influence in the international system cannot be denied, since Tokyo´s diplomacy has impacted Japanese foreign relations even if it was as a collateral effect of the intended actions. This means that although city diplomacy is not purposely challenging the state, but rather complementing national policy guidelines, to the extent that the city is acting on its own at an international level, some amount of challenge to the state-to-state status quo is in motion. Another aspect showing how embedded is the primacy of the state in international politics is that the actors that already have participated as receivers of Tokyoite diplomatic efforts have considered them to be part of the activity of the Japanese Ministry of Foreign Affairs rather than an initiative of the city. When Masuzoe visited Seoul and Incheon in South Korea, he was not received as the representative of Tokyo, but as an envoy of Japan’s Foreign Affairs Minister (Miyajima, 2015). Finally, Masuzoe’s efforts to make Tokyo a truly global city through the attraction of corporations, highly-skilled workers and international conferences (TMG, 2014), is in the line of making Tokyo influential at the international level through the city as a place strategy. By hosting the 2020 Olympics, the city is seeking to be the space where transnational networks converge, reinforcing its role as stage for politics rather than as a unitary actor.

As long as Tokyo’s diplomacy strategy continues focusing on city-to-city relations and does not seek to put the city in the international sphere as an equal partner to states and international organisations, this so-called diplomacy will be none other thing than an ornate way of referring to public relations and place branding.

5.2. The Occupy Movement

Although the Occupy Movement (OM) has extended around the world, across global and non-global cities with different impact, two global cities have been capital for the movement:

Madrid and New York (Rogers, 2011). We will focus on the role of New York’s organisation14, Occupy Wall Street (OWS), as an example of an organisation using the city as a place as means to influence international politics. The OWS movement, which was central to the internationalisation of the movement through city-to-city networks, defines itself on its website as:

‘A people-powered movement that began on September 17, 2011 in Liberty Square in Manhattan’s Financial District, and has spread to over a hundred cities in the United States and actions in over 1,500 cities globally. #OWS is fighting back against the corrosive power of major banks and multinational corporations over the democratic process, and the role of Wall Street in creating an economic collapse that has caused the greatest recession in generations. The movement is inspired by popular uprisings in Egypt and Tunisia, and aims to fight back against the richest one per cent of people that are writing the rules of an unfair global economy that is foreclosing on our future.’

(OWS, 2011) OWS presents itself as part of a broader global movement that acts in urban environments and that is motivated by the side effects of global financial capitalism, hence a supra-national abstract issue whose responsibility cannot be attributed to any particular actor. The movement, acting locally to change the international economic model (Walker, 2011), is novel because of (1) the expansion of the movement across cities through mass media information and social media coordination; and (2) its mode of action, reclaiming the use of public spaces within the city as places to exteriorise social malaise.

On the one hand, the OM has allowed global cities to influence international politics by using pre-existing connections amongst them to increase the span of the movement and their demands. The introductory statement of OWS recognises a characteristic city-to-city interaction as the main driver of the movement’s expansion: it is not international because the spread has not been between states, but transnational to the extent that its extension has succeeded between cities through and despite national borders. The movement represents New York as an informational node, a junction of transnational networks that in joint action with protesters in Madrid called for a global-wide demonstration on 15 October 2011 with the objective of ‘initiating global change against capitalism and austerity measures’ (Gabbatt, Townsend and O’Carroll, 2011).

At the end of 2011, amongst the existing 45 alpha global cities according to GaWC15, only ten of them were not stages of protests by the movement. In addition, several global cities classified as beta or gamma cities were also affected by the protests. This suggests that the trans-nationalisation of the OM indeed used pre-existing networked channels amongst world cities to spread and share ways of action (Rogers, 2011). However, most recent data, as we can see in Map 2, shows that as of August 2015 all 45 alpha global cities have movements that are either the OM itself or national equivalents of the organisation, showing a deep spread of the OM.

14 In every global city ranking, New York usually ranks within the five positions at the top. It shares with London the Alpha ++ category in the GaWC Global Cities Ranking, and it is an important centre of networking and decision making. For more information consult Taylor et al, 2010; WB, 2014; UNDESA, 2015; and see tables 1, 2, 3, 4 and 5. 15 See Table 1.

Map 2: Global Presence of the Occupy Movement

Source: Occupy Directory, 2015.

On the other hand, global cities, used as place for action and reaction against the current world’s economic system, provided the physical environment to exteriorise the demands of the OM, hence connecting in a direct non-mediated way the local protest, that in eventually spread across the world, with the international system. Although cities were used as a tool to influence politics by a concrete organisation, cities cannot be judged as a simple passive object: cities are alive, they are both object and subject, and consequently the protest movements forged within them cannot be considered independently of the city that gave them birth (Castells, 1992). Since the global city is not acting as unitary actor when the OM takes advantage of its privileged position in the world’s informational system or when the OM uses its streets to perform a protest, technically the city is being used as a passive object through which to influence international politics. However, the global city is not only a built environment where the action happens, but as well a sort of megaphone to amplify the reach of OM’s demands. In addition, due to the popular, unorganised and largely non-funded character of the movement, is also the only means available to ensure the demands are heard in the international sphere of politics without undertaking a formal restructuration to comply with international organisations and lobbies standards.

Consequently, in this case global cities cannot be clearly defined as influential to international politics since the impact it does not depend on the city per se, but on the movement acting within the city. Notwithstanding, it is also true that these movements will be less effective if they were not based on a global city: the OM benefits from all the attention that these cities attract due to the privileged position they have because of command centres and financial flows concentration in its territory. Thence, global cities are the ideal location to ensure that the span of a movement’s demands reaches a worldwide audience.

6. Conclusion Although world cities are mainly considered global because of economic aspects, their globality is not necessarily a consequence of this. Sometimes the economic muscle is overshadowed by the city’s centrality in international politics as a consequence of the centralisation of resources that allows cities to be global command and control centres. Some cities have reached a world status thanks to their impact in global affairs either as unitary actors fighting to establish their own niche of action or as locations where transnational politics and activism are staged.

However, we have explored how this relation between the global city and the world system is not as straightforward as it could seem at the beginning. Despite their dynamic mutual influence, the world system is currently based in a state-to-state status quo established in international relations scholarship as well as in practice. Consequently, the actions of other minor actors are questioned in terms of upon which legitimacy they are allowed to relate to the international system.

As free-will unitary actors, cities connect with other cities and even with other states, as we have seen analysing Tokyo’s performance of its city diplomacy. Cities are not contained within their territorial states; consequently, to the extent that they relate to the system without passing through state channels, they are somehow challenging the supremacy of the state. Notwithstanding, both case studies have confirmed that the city, as both unitary actor and place for action and interaction, are not intentionally challenging states: this is rather a collateral situation produced by the new niche for action that global cities are creating for themselves within the world system.

This niche lies in a semi-peripheral situation, where global cities are put because they are not states, thence denying them their singular core-like characteristics. Nevertheless, the semi-peripheral position of global cities reinforces their role as the stage where international politics is orchestrated, allowing them to be a hinge between actors fully integrated in the system and those marginalised and fated to inhabit its hinterlands. On the one hand, world cities are the physical spaces where formal international politics is portrayed because as spaces of flows they are extremely attractive to house international and transnational organisations. But on the other hand they are as well the spaces used by actors sitting in the margins of this formal politics, like transnational activists, to amplify their demands to the international system. Therefore, global cities, as locations headquartering both formal international institutions and informal transnational movements, are connecting international politics with the demands of those actors that cannot speak with their own voice because they lack of formal legitimacy in the world system. However, International Relations scholarship has particularly disregarded the impact that transnational activism has in the formal international arena, mainly because these movements use non-conventional means of action and their effective impact results most of the times simply anecdotic. But by locally protesting against supranational and international organisations, these movements are connecting the individual with the globe, skipping the traditional phase of channelling demands through the state. Hence, their importance dwells on their procedure rather than in their effectiveness, taking advantage of the global dimension of cities to relate in a direct non-mediated way with the international system. Through these ways for action, world cities have reclaimed their niche of activity, placing them as essential to the world system, especially for international politics and the global political system. The production of services for global-wide clients and their informational interconnectedness put global cities not as the conductors of the global politics orchestra, but

as the opera house where the music is being played. However, the acoustic of the room affects the way on which the music is heard, being musicians consequently conditioned to play the piece in a certain way.

The difference is that cities are bustling, dynamic, with a certain intentionality that enables them to participate as actors in their own right: hence, global politics will not be the same without global cities actively playing their instruments while also hosting the concert. That is the novel thing about cities: they are container and content; object, subject, and the place where both object and subject construct the everyday life of international politics.

Bibliography Abrahamson, M. (2004). Global Cities. Oxford University Press.

Bourdieu, P. (1992), Language And Symbolic Power. Polity Press. Burton, L. (2014) [Online] 29th November. ‘Wto Riots In Seattle: 15 Years Ago’, In Seattle

Post-Intelligencer. Available From: Http://Www.Seattlepi.Com/ [Accessed On 7th September 2015]

Castells, M. (1992), The City And The Grassroots. University Of California Press. Castells, M. (2000), ‘Towards A Sociology Of The Network Society’, In Contemporary

Sociology. Vol. 29, N. 5, Pp. 693-699. American Sociological Association. Clark, D. (1996), Urban World / Global City. Routledge.

Csomos, G. (2012) [Online]. Data Set 26 Of The Globalization And World Cities (Gawc) Research Network (Http://Www.Lboro.Ac.Uk/Gawc/), Publication Of Inter-City Data [Accessed On 17th August 2015].

Denemark, R.A. (1999), ‘World System History: From Traditional International Politics To The Study Of Global Relations’, In International Studies Review. Vol. 1, N. 2, Pp. 43-75. Blackwell Publishers.

Donnelly, J. (2001), ‘Realism’, In Burchill, S. Et Al. (2001) International Relations Theories. 3rd Ed, Pp. 29-54. Palgrave.

Friedman, J. (1986), ‘The World City Hypothesis’, In Development And Change. Vol. 17, N. 1, Pp. 69-83. Wiley Online Library.

Gabbatt, A., Townsend, M., And O’carroll, L. (2011) [Online] 15th October. ‘Occupy Anti-Capitalism Protests Spread Around The World’, In The Guardian. Available From: Http://Theguardian.Com [Accessed On 21st August 2015].

Giddens, A., Sutton, P.W. (2013), ‘Globalization And Social Change’, In Sociology. Pp. 108-151. Polity.

Gurr, T.R. And King, D.S. (1987), The State And The City. Macmillan Education.

Hohenberg, P., And Lees, L. H. (1995), The Making Of Urban Europe 1000-1994. Harvard University Press.

Huang, J. And Wu, W. (2012), ‘Belgian Economy Characteristics And Its Experiences’, In Canadian Social Science. Vol. 3, N. 6, Pp. 74-75. Canadian Academy Of Oriental And Occidental Culture (Caooc)

Imusil, R. (2013), [Online] 19th March. World Cities In A System Of Nation States. Available From Http://Www.Lboro.Ac.Uk/Gawc/ [Accessed 14th August 2015].

King, A.D. (1983), ‘The World Economy Is Everywhere: Urban History And The World System’, In Reeder, D. (1983), Urban History Yearbook. Leicester University Press.

King, A.D. (1990), Global Cities: Post-Imperialism And The Internationalisation Of London. Routledge.

Knox, P. L. (2000), ‘World Cities In A World-System’, In Knox, P.L., Taylor, P.J., (2000), World Cities In A World-Systemk, Pp. 3-20. Cambridge University Press.

Kotkin, J. (2006), The City. Modern Library.

Lee, R. And Pelizzon, S. (1991), ‘Hegemonic Cities In The Modern World-System’, In Kasaba, R. (1991) Cities In The World-System. Greenwood Press.

Lefevre, M. (2015), ‘The Mighty Metropolis’ In The World Today. Vol. 71, N. 1, Pp. 14-15. Chatham House.

Masuzoe, Y. (2015) [Online] 10th February. My Vision For City Diplomacy. Available From: Http://Www.Metro.Tokyo.Jp/ [Accessed On 20th August 2015].

Mcdonald, J.F. (2014), ‘What Happened To And In Detroit?’, In Urban Studies. Vol. 51, N. 16, Pp. 3309-3319. Sage Pub.

Mearsheimer, J. (1995), ‘The False Promise Of International Institutions’, In International Security. Vol. 19, N. 3, Pp. 5-14. Mit Press Journals.

Miyajima, A. (2015), ‘Tokyo: Can A City Have Its Own Foreign Policy?’, In The World Today. Vol. 71, N. 1. Chatham House.

Nash, K. (2008), ‘Global Citizenship As Showbusiness: The Cultural Politics Of Make Poverty History’, In Media, Culture And Society. N. 30, Vol. 2, Pp. 167-181. Sage Publications.

Perulli, P. (2012), [Online] 22nd October. The Ontology Of Global City-Region: A Critique Of Statehood. Available From: Http://Www.Lboro.Ac.Uk/Gawc/ [Accessed 14th August 2015].

Rizzo, A. And Galanakis, M. (2015), ‘Transdisciplinary Urbanism: Three Experiences From Europe And Canada’, In Cities. Vol. 47, N. 1, Pp. 35-44. Elsevier.

Rogers, S. (2011) [Online] 14th November. ‘Occupy Protests Around The World: Full List Visualised’, In The Guardian. Available From: Http://Www.Theguardian.Com/ [Accessed On 21st August 2015].

Sassen, S. (1991), The Global City: New York, London, Tokyo. Princeton University Press. Sassen, S. (1994), Cities In A World Economy. Pine Forge Press.

Simon, D. (2000), ‘The World City Hypothesis: Reflections From The Periphery’, In Knox, P.L., Taylor, P.J., (2000), World Cities In A World-System, Pp.132-155. Cambridge University Press.

Smith, D.A. And Timberlake, M. (2000), ‘Cities In Global Matrices: Towards Mapping The World-System’s City System’, In Knox, P.L., Taylor, P.J., (2000), World Cities In A World-System, Pp. 79-97. Cambridge University Press.

Taylor, P.J. (2000), ‘World Cities And Territorial States: The Rise And Fall Of Their Mutuality’, In Knox, P.L., Taylor, P.J., (2000), World Cities In A World-System, Pp. 48-62. Cambridge University Press.

Taylor, P.J. (2003) [Online]. Data Set 18 Of The Globalization And World Cities (Gawc) Research Network (Http://Www.Lboro.Ac.Uk/Gawc/), Publication Of Inter-City Data [Accessed On 17th August 2015].

Taylor, P.J. (2004) [Online]. Data Set 22 Of The Globalization And World Cities (Gawc) Research Network (Http://Www.Lboro.Ac.Uk/Gawc/), Publication Of Inter-City Data [Accessed On 17th August 2015].

Taylor, P.J. And Catalano, G. (2000) [Online]. Data Set 11 Of The Globalization And World Cities (Gawc) Research Network (Http://Www.Lboro.Ac.Uk/Gawc/), Publication Of Inter-City Data [Accessed On 17th August 2015].

Taylor, P.J., Firth, A., Hoyler, M. And Smith, D. (2010) [Online]. Data Set 25 Of The Globalization And World Cities (Gawc) Research Network (Http://Www.Lboro.Ac.Uk/Gawc/) Publication Of Inter-City Data [Accessed On 17th August 2015].

Walker, P. (2011) [Online] 28th November. ‘Occupy London Sets Out Agenda On How It Wants To Change The Economic World’, In The Guardian. Available From: Http://Theguardian.Com [Accessed On 21st August 2015].

Wallerstein, I. (2004), World-System Analysis. Duke University Press.

Institutional Publications BEA - Bureau of Economic Analysis, US Department of Commerce (2013) [online] 17th

September. Economic Growth Widespread across metropolitan areas in 2012. Available from: http://www.bea.gov/ [Accessed 17th August 2015].

GLOBALISATION AND WORLD CITIES RESEARCH NETWORK (GaWC) (2010) [online]. Global cities in harmonious development. Available from: http://www.lboro.ac.uk/gawc/ [Accessed on 14th August 2015].

GLOBALISATION AND WORLD CITIES RESEARCH NETWORK (GaWC) (2014) [online] 13th January. The World according to GaWC 2012. Available from: http://www.lboro.ac.uk/gawc/ [Accessed 12th August 2015].

GLOBALISATION AND WORLD CITIES RESEARCH NETWORK (GaWC) (2015) [online]. World City Relational Data. Available from: http://www.lboro.ac.uk/gawc/ [Accessed 12th August 2015].

NRT - NEWS ROOM TOKYO, (2015) [online] 30th March. Envisioning Tokyo’s global future. Available from: http://www3.nhk.or.jp/ [Accessed on 20th August 2015].

OCCUPY DIRECTORY (2015) [online]. Available from: http://directory.occupy.net/ [Accessed on 21st August 2015].

OWS - OCCUPY WALL STREET (2011) [online]. About Occupy Wall Street. Available from: http://occupywallst.org/ [Accessed on 21st August 2015].

TMG - TOKYO METROPOLITAN GOVERNMENT (2014) [online] 25th December. Summary of the Tokyo Metropolitan Government’s Basic Strategy for City Diplomacy. Available from: http://www.seisakukikaku.metro.tokyo.jp [Accessed on 20th August 2015].

UN-HABITAT (2013), State of the World’s Cities 2012/2013, Prosperity of Cities. Routledge.

UN DESA - UNITED NATIONS DEPARTMENT OF ECONOMIC AND SOCIAL AFFAIRS, POPULATION DIVISION (2015) [online]. Total population, both sexes, per country. Available from: http://esa.un.org/unpd/wpp/DVD/ [Accessed 14th August 2015]

WB - WORLD BANK (2014) [online]. World Development Indicators. Available from: http://databank.worldbank.org/data/ [Accessed 17th August 2015].

Can ‘war minus the shooting’ encourage development and peace?

Alison Freebairn

Abstract Can sport, which was memorably described by George Orwell as ‘war minus the shooting’, help communities recover after war or disaster and achieve development goals, or is its competitive and occasionally violent nature inherently unsuitable as a method to build peaceful societies and encourage post-conflict reconciliation? In my research, I will explore whether sport is an appropriate peace-building and reconciliation tool in post-conflict and developing societies. I will address academic concerns about the apparent assumption in the sport for development and peace (SDP) sector that sport is an inherently benign and beneficial activity, and examine different approaches to SDP. I will analyse the rise of the SDP movement; ask if the competitive nature of team sports and the associated passions, tribalism and physical nature are conducive to healing divisions between peoples; consider the impact of SDP programmes in different countries, and explore criticisms that not enough is being done to evaluate their efficacy.

Introduction Sport for Development and Peace (SDP) is a wide umbrella term that covers different approaches and objectives, and is loosely defined as ‘the use of sport to exert a positive influence on public health, the socialisation of children, youths and adults, the social inclusion of the disadvantaged, the economic development of regions and states, and on fostering intercultural exchange and conflict resolution’ [Lyras and Welty Peachey, p. 311]. Today, sport is sometimes used to promote inter-faith and inter-cultural communication and/or post-conflict reconciliation i.e. peace; and sometimes to improve life goals and infrastructure in pursuit of the Millennium Development Goals (MDGs) i.e. development, and sometimes covering both the ‘peace’ and the ‘development’ angles [Kidd 2008, p372-3].

In the international humanitarian and development industries, there are as many definitions of peace and development as there are NGOs and INGOs working to encourage growth and community resilience in beneficiary populations. However, in the context of this dissertation, ‘peace-building’ will be defined as ‘a range of measures targeted to reduce the risk of lapsing or relapsing into conflict by strengthening national capacities at all levels for conflict management, and to lay the foundation for sustainable peace and development’ [United Nations Peace-building Fund 2007] and ‘development’ will be defined as work ‘that promotes prosperity and economic opportunity, greater social well-being, and protection of the environment’ [United Nations 2015]. ‘Sport’ is defined by the UN Inter-Agency Task Force for Sport for Development and Peace as ‘all forms of physical activity that contribute to physical fitness, mental well-being and social interaction, such as play, recreation, organised or competitive sport, and indigenous sports and games’ [UN 2003].

The dominant narrative across the SDP sector, from NGOs and INGOs, donors and governments is ‘based on the a priori assumption that, in and of itself, sport is a social good’ [Sugden 2010, p.260] that can be harnessed to bring development gains to communities and peoples affected by poverty, conflict, disaster or disease, and encourage peaceful and healthy living. SDP practitioners claim that children and young people can learn important life skills by playing organised sport, improve their health and self-esteem, and allow them to act as peer educators and role models within their communities. Sport can also ‘convey core principles that are important in a democracy, such as tolerance, solidarity, cooperation and respect’, and can be enjoyed by all people regardless of their background, ethnic group, gender or physical capabilities [Beutler, p.365-366].

However, the image of sport worldwide is not framed solely by its admirable qualities of hard work, the strong bonds between team players, athleticism and success, but also by scandal, violence, corruption, racism, greed and doping, as ‘international sport and sport in general have also been the arena of unethical or controversial behaviour, abuse and exploitation’ [Dienes, p.44]. Sport’s long association with war, and the tribalism that results from passionate allegiance to an international, national or community sports team or athlete, can also cast doubt on its suitability as a path to peace and development. In 1945, George Orwell wrote an essay titled ‘The Sporting Spirit’ after watching an exhibition match between England’s national team and USSR champions Moscow Dynamo. In the essay, published in The Tribune newspaper, Orwell wrote of his fears that competitive sport was being manipulated by States and used as a vehicle for nationalist aggression, and bemoaned the competitiveness and violence he saw on the pitch. ‘Serious sport has nothing to do with fair play,’ he wrote. ‘It is bound up with hatred, jealousy, boastfulness, disregard of all rules and sadistic pleasure in witnessing violence: in other words it is war minus the shooting’ [Orwell, 1945].

Given its associations with conflict, violence, doping and corruption, can ‘war minus the shooting’ really encourage development and peace-building? Is sport, as argued by Gary Armstrong, ‘a pastime fraught with ideas of exclusion, elitism, militarism, ethno-political tension and used as a political vehicle the world over’? [Armstrong, p.475] Or can sport, when carefully targeted to achieve specific goals, draw on its status as ‘a mode of mutual expression of our common humanity’ and reach its potential as a peace-building tool? [Parry, p.785]

In this dissertation, I will question the assumption that sport is an inherently positive medium through which to achieve development gains and encourage peaceful living in developing and post-conflict societies. I will explore this by examining the forces and influences that have led to the huge growth in the sector, looking at arguments for and against the efficacy of SDP work, tracing the long associations between sport and conflict, discussing the global image of sport, and reviewing criticism of how the sector operates and presents evidence of its impact. There will be no separate literature review within the work, as I will draw on the available academic work – covering SDP, sports diplomacy, peace studies, history, international relations, war studies, pedagogy and international development - throughout the dissertation in support of my arguments.

Chapter one – More than a game: the rise of the Sport for Development and Peace movement. ‘People in every nation love sport. Its values - fitness, fair play, teamwork, and the pursuit of excellence - are universal. At its best, it brings people together, no matter what their origin, background, religious beliefs or economic status…That is why the UN is turning more and more often to the world of sport for help in our work for peace and our efforts to achieve the Millennium Development Goals.’ - Kofi Annan [quoted in the UN report on 2005 International Year for Sport and Physical Education, p.7]

The popularity of SDP has grown quickly over the past two decades, and it is estimated that more than 600 such organisations are now operational worldwide [sportanddev.org]. The rise of the movement can be attributed to sport’s global popularity but it is also indicative of the changing nature of international cooperation and international development. Tess Kay notes that ‘while international development decision-makers of the 1940s would have considered sport an irrelevancy to their work, sixty years later there was a very close match indeed between what sport claimed to offer and what international development believed it needed’ [Kay 2012, p.889]. SDP’s appeal to practitioners, donors and the media may also be based in its ambiguity – not only in the wide interpretations of what sport and development can mean when applied to different contexts, but also in how easily an idealised vision of both sport and development can be presented. Fred Coalter describes this as SDP’s ‘mythopoeic nature’, which lends itself to media- and donor-friendly images supported by all the sporting clichés that have been embedded in popular culture for generations – ‘Playing the game, fair play, level playing fields, it’s not cricket, first past the post, getting to first base, throwing in the towel, being on a winning team. It is as if sport is life.’ [Coalter 2013, p.21] The use of sport to support or influence peoples and nations is not new, as States have used sport in many ways over the centuries: asserting their superiority over neighbours and rivals; instilling fitness and discipline in the soldiers of their armies; spreading imperial values among colonised peoples as part of a ‘civilising’ mission, and applying diplomatic pressure by choosing to attend or to boycott major international sporting events [Levermore 2008,

p.184]. Development and peace-building agencies have also used sport in their work for decades, particularly by humanitarian aid workers ‘to ameliorate the living conditions of victims of conflict or natural catastrophe and in dealing with trauma cases’ [Beutler, p.359].

The United Nations has been one of the main drivers of the SDP approach. Initially it did so as part of its overarching objective to promote and preserve peace, and more recently SDP has been adopted as a response to the post-Cold War move away from the Clausewitzian inter-state war model and towards today’s protracted and complex intra-state conflicts, which are described by Mary Kaldor as ‘New Wars’ [Kaldor, 2012]. Sport, the UN argues, is a useful way to encourage greater tolerance, cooperation and co-existence between peoples at the grassroots level, thus contributing to conflict prevention and peace [Dienes, p.45]. The UN’s involvement in sport for development and peace was first formalised in 1978, when UNESCO, the United Nations Educational Scientific and Cultural Organisation, adopted the International Charter of Physical Education and Sport. In addition to codifying the importance of sport and physical education as a human right and a healthy goal in itself, Article 10.3 of the Charter draws specific attention to international cooperation towards the promotion of sport and the benefits this could bring, stating: ‘Through co-operation and the pursuit of mutual interests in the universal language of physical education and sport, all peoples will contribute to the preservation of lasting peace, mutual respect and friendship and will thus create a propitious climate for solving international problems’ [UNESCO, 1978]. The 1978 Charter built on a number of ad-hoc arrangements that had existed within the UN since 1922, when the International Labour Organisation signed an institutional agreement with the International Olympic Committee to encourage greater access to sport. In 2001, the then Secretary-General Kofi Annan appointed Adolf Ogi as the first Special Adviser on Sport for Development and Peace to encourage cooperation between UN agencies and the sports world, and the UN Inter-Agency Task Force for Sport for Development and Peace was convened the following year to review all sport-related activities taking place under the UN umbrella and encourage the system to incorporate sport into its activities [Beutler, p.360]. Annan remains a strong supporter of SDP, telling the 2010 SportAccord International Convention that ‘I admit we at the United Nations were often a little jealous of the power, and indeed, universality of sport. Both the International Olympic Committee and FIFA have, for example, more members than the UN…it was why I was so determined at the UN to use sport more effectively to achieve development goals’ [Annan, 2010]. The UN has passed several Resolutions on sport and development and further linked the two in the promotion of the 2005 Millennium Development Goals (MDGs) – although it noted that while sport did not have the capacity to achieve the goals in its own right, ‘it can be very effective when part of a broad, holistic approach to addressing the MDGs’ [UN]. It denoted 2005 the Year of Sport and Physical Education and, in 2008, the UN worked with the International Olympic Committee to establish a framework for action to promote the use of sport to help achieve the MDGs. In 2013 the 67th United Nations General Assembly announced an ‘International Day of Sport for Development and Peace’ would be celebrated on 6 April every year from 2014 [sportanddev.org] and, in 2015, SDP was included in the post-MDG Sustainable Development Agenda, which will be considered for adoption by the UN General Assembly on 25-27 September [UN 2015]. Many prominent athletes from several sporting disciplines have become involved in the efforts of various UN agencies in recent years as Goodwill Ambassadors, Messengers of Peace, Champions of Sport, International and National Ambassadors, and Celebrity Partners, leveraging sport’s global profile and position as ‘a powerful instrument for mobilization and advocacy’ [Beutler p.365].

The growing academic field of sports diplomacy recognises and analyses the economic, social, historical and diplomatic influence of sport and its ability to create common ground for negotiation and bridge-building between governments and between peoples [Johns, p.3], the capacity of both sport and diplomacy ‘to influence the lives of millions of people across the planet’, and the growth in the importance of soft power in contemporary diplomacy and international relations, particularly since the end of the Cold War [Pigman and Rofe, p.1095-6]. This can take the form of hosting sports mega-events such as the FIFA World Cup; hosting or sponsoring youth tournaments or exchanges, or using sport as a soft power tool in foreign policy, e.g. the “ping pong” diplomacy that brought the US and China together in the 1970s, or the sport boycotts that have been used by many States to peacefully express their opposition to the domestic or foreign policy of other nations [Nygård and Gates, p.236].

SDP gained one of its most revered supporters in the 1990s, when Nelson Mandela embraced the use of sport as a tool for development and peace in South Africa after apartheid was abolished. For most of the century, sport in South Africa had been used by the ruling apartheid government to bolster segregation and impose white colonial attitudes on the whole population, particularly through popular colonial-era sports such as rugby and cricket. But this in turn encouraged the majority black population to leverage sport with the international sporting and political communities. The international sporting boycott that developed and strengthened throughout the 1950s, 1960s, 1970s and 1980s helped to raise awareness of apartheid and the struggle against white rule and, while it was just one factor among many that led to the eventual downfall of the regime, ‘sport proved to be a remarkable symbol of the anti-apartheid campaign with the result that for many people around the world discrimination in sport was one of the most familiar manifestations of apartheid’ [Keech and Houlihan, p118]. Mandela had a nuanced understanding of the importance of sport – both to the people of a nation, and also to its leaders and, after the fall of the apartheid regime, Mandela’s release from prison and return to political life and the end of the international sporting boycott of South Africa in 1991, he was determined to use sport as a catalyst for all South Africans to come together and start to heal the divisions imposed by the deposed apartheid government. His vision of multiracial sports teams that would be the pride of a peaceful Rainbow Nation was realised only one year into his first term as President, in 1995, when South Africa won the Rugby World Cup it was hosting [Sugden 2010, p.262-263]. Post-apartheid South Africa proved to be fertile ground for the concept of pursuing development and peace through sport, particularly after the Rugby World Cup win, and the new government focused on sport-led development programmes to foster national unity and address the challenges presented by HIV/AIDS, inequality and poverty [Cornellisen, p.510].

Four-time Olympic speed skating champion Johann Koss was another prime mover in the early days of SDP, encouraging the 1994 Lillehammer Winter Olympic Games Organizing Committee to partner with humanitarian agencies and civil society groups to form Olympic Aid. Initially, its objectives were to use sporting celebrity to raise money for humanitarian causes, but it later grew to run its own programmes for children in refugee camps [Kidd 2008, p.372]. It now operates as Right to Play and has 14,400 local coaches and 600 international staff operating in 19 countries in Africa, Asia, the Americas and the Middle East [righttoplay.com]. In the promotional literature published by the UN and other SDP actors, sport is praised for its ability to foster discipline, confidence and leadership, and for instilling character traits such as tolerance, cooperation and respect, noting ‘sport teaches the value of effort and how to manage victory, as well as defeat’ [UN]. This focus on respectful interactions on and off the

field is at the core of SDP. For example, Football 4 Peace International was founded by the University of Brighton in 2001 and initially focused on using sport to improve relations and encourage interaction and reconciliation in Jewish and Arab communities in Israel before expanding its programmes to Palestine, Jordan, South Africa, Germany, Ireland, Northern Ireland and England. Its methodology promotes respectful interaction between members of formerly divided communities to foster a greater sense of belonging and understanding across social, religious or political boundaries. F4P uses values-based education methods rather than skill development, and has claimed success in breaking down stereotypes among its participants through interaction on and off the playing field, particularly in fielding mixed teams so that individuals of different ethnic and social groups were encouraged to both work together and compete against one another [football4peace.eu].

The Open Fun Football Schools (OFFS) project was launched in the Balkans in 1998 by a Danish NGO called Cross Cultures Project Association, and has since held 1,400 five-day football schools projects in the region, involving more 283,000 girls and boys aged between seven and twelve years old. Throughout the project, OFFS staff and volunteers organised the events in such a way that the municipalities that took part were required to team up with another from a different ethnic background, to encourage interaction and communication [Rookwood, p.473]. This approach has been ‘strikingly successful, not only in getting children from across frontlines to play together, but also in getting their families and communities to cheer for them, and their local football clubs and town leaders to cooperate’ [Gasser and Levinsen, p.470]. In 2014 OFFS expanded across Ukraine, in partnership with the Football Federation of Ukraine, to offer its SDP activities to 7,300 vulnerable children, of whom 40% were girls, 15% were suffering from social problems, and 4% were orphans. Some 500 children who had been displaced by unrest in the country were also included in the programme [ccpa.eu/what-we-do/open-fun-football-schools].

While football is a popular way to reach children with SDP activities, basketball is also used successfully in the Global South. Assessments indicate that participants in a Peace Players International basketball programme in South Africa held fewer harmful stereotypes and expressed fewer racist attitudes than children who had not take part [sportanddev.org].

As the popularity of SDP has grown alongside that of international sport itself, international sporting bodies such as Fédération Internationale de Football Association (FIFA), the International Olympic Committee (IOC), Union of European Football Associations (UEFA), the International Cricket Committee (ICC) and the International Paralympic Committee have all become involved in funding grassroots sporting activities in developing countries, which are usually carried out alongside major sporting competitions such as the World Cup and designed to act as capacity-building legacies for the event. These are intended to encourage long-term growth across the country’s economy through increased employment, more tourism etc., as well as having a trickle-down effect in terms of increased opportunities at the grassroots level. However, it has been argued that such mega-events do not lead to greater development for the host country, but rather bring potentially damaging behaviours and unintended consequences including increased homelessness following slum clearances, a rise in prostitution, and entrenchment of existing vulnerabilities [Cornelissen, p.508].

In 2000, the International Olympic Truce Foundation was established by Greece and the International Olympic Committee to turn the Olympic Movement’s peaceful principles into action, with its including ‘to uphold the observance of the Olympic Truce, calling for all hostilities to cease during the Olympic Games and beyond, and mobilizing the youth of the world in the cause of peace’ [olympictruce.org 2015].

FIFA formed a strategic alliance with the UN in 1999, initially committing 0.7% of its revenue to SDP projects, and the resulting joint projects have included the ‘Red Card to Child Labour’ programme with the International Labour Organisation; a project proving sports equipment for refugees in Sudan with the United Nations High Commission for Refugees, and the FIFA/UNICEF ‘Go Girls! Education for Every Child’ [Hough, p.1289]. FIFA launched the Football for Hope initiative in 2005 to provide financial and material resources for social development projects allowing children and young people to explore HIV/AIDS awareness, gender issues, conflict resolution, leadership and education through sport. It also funds Football for Hope Centres for sports-based youth education and its GOAL programme provides resources to build or reconstruct national football infrastructure [FIFA 2015]. However, Richard Giulianotti questioned FIFA’s commitment to humanitarianism in 2004, when he compared the institution’s then budget for humanitarian support - £907,000 - with the £5,000,000 it had set aside to cover top officials’ expenses during the 1998 World Cup finals in Paris, or the £1,600,000 provided to buy official presents for its official contacts [Giulianotti 2004, p.359].

UEFA has been a partner of the International Committee of the Red Cross (ICRC) since 1997 and has donated more than ten million Swiss francs to the ICRC’s physical rehabilitation programme in Afghanistan, which uses sport to help children and adults who suffer from polio or who have lost limbs in the protracted conflict [ICRC, 2014]. Individual football teams have also got involved. The alliance between Manchester United FC and the UN’s children’s agency UNICEF – United for UNICEF – is in its fifteenth year and is now the longest-running partnership of its kind between a sports organisation and an international NGO. More than £3,000,000 has been raised and an estimated 3,400,000 vulnerable children have benefited from its sports, education and child protection programmes [Manchester United Foundation 2015].

Sport’s corporate sector has also become involved with development and peace-building programmes as part of its Corporate Social Responsibility (CSR) work, much of it following child labour scandals in the 1990s [Boje and Khan, 2009]. For example, adidas funds the Ginga Social SDP project in Brazil, and the BOKS programme in US, Japan, South Korea, Canada, Panama, and India [adidas 2014]. Non-sporting companies including BP and Deloitte have also become involved in funding SDP schemes [Levermore 2008, p.185] and corporate giants such as Coca-Cola now donate to humanitarian and development organisations as part of their CSR activities. For example, the German-based Streetfootballworld, which unites more than a hundred community-based organisations worldwide under the banner of ‘Changing the world through football’, is funded by FIFA, UEFA and adidas alongside government departments and foundations, but is also backed by Coca-Cola and Sony among other non-sports corporations [Streetfootballworld 2015].

In the post-Cold War world, with its complex emergencies and long-running internationalised intra-State conflicts, the role and function of armed forces is also changing. As a result, many armies from both the North and the South are taking part in UN-led peace-keeping operations rather than being deployed in Clausewitzian inter-State wars, and are given mandates to protect and promote peace and stability in post-conflict, fragile and post-disaster regions, notably in the Balkans, Sierra Leone and Liberia [Giulianotti and Armstrong, p.384]. As part of a “hearts and minds”-driven process, UN troops are also becoming involved in SDP activities as part of their peace-building mandate, with some success. Studies of Sierra Leone’s post-civil war UN and government intervention to support the disarmament, demobilisation and reintegration (DDR) process from 1998-2003 have shown that sport helped to decrease the number of violent incidents in the DDR camps housing former child soldiers and other ex-combatants, and helped the young men to channel and manage their

aggression [Dyck, p.409]. FIFA president Sepp Blatter called on the world to ‘make goals not war’ in 2004, when Brazil played a friendly against Haiti as part of the UN peacekeeping mission in the Caribbean country. Haitian President Gérard Latortue, speaking after his nation’s side had lost the match, was quoted as saying that ‘a few Brazilian soccer stars could do more to disarm warring militias than thousands of peacekeeping troops’ [Hodge, p.1294].

The involvement of NGOs and INGOs, corporations, international governing bodies, the military and other State apparatus supports the SDP ethos that sport is the correct medium through which to reach, influence and educate young people in the developing world. But if the positive messages of sport are deemed to be absorbed so readily by children and young people, what about the affect of its negative messages? Sport may have unrivalled global popularity, but this does not necessarily mean that its influence is always positive and its image is further framed and interpreted by the media, which can focus on negative stereotypes and ‘regularly conveys a mirror of the widening wealth/poverty divide’ [Levermore 2010, p.230]. So while the UN and other SDP prime movers can argue convincingly that sport ‘is a powerful and positive force for social integration’, more cautious voices from academia can point to evidence that sport’s history of ‘dramatizing or intensifying sources of social conflict’ can be ‘far more dysfunctional than functional to social order’ [Giulianotti 2004, p.356]. While it is undeniably uplifting and exciting and inspires great passion in spectators and participants alike, sport, as noted in the introduction, also has a well-documented darker side, one that encompasses some of the worst aspects of humanity.

Chapter two – It’s about winning: competitive sport, war, and tribalism. ‘Football is merely a continuation of war by other means.’ Franjo Tudjman, President of Croatia. [Gasser and Levinson, p.457]

Educators have used sport in an attempt to influence and control the lives and behaviours of young people for decades. ‘Sports evangelism’ was commonplace in Western countries in the twentieth century in an attempt to ‘dissipate the lower orders’ dangerous energies and to divert them from “licentious” social practices’. There is little evidence that this approach worked with Western teenagers, but this has not dissuaded SDP practitioners from their apparent belief that ‘young people in the old colonies’ will more receptive [Giulianotti 2004, p.356-7]. At present, many SDP programmes operate from the fundamental belief that ‘simply having a sport program or initiative of some kind will automatically and inevitably serve the development goals of socialization, education, and intervention’, instead of being one of many factors that must be taken into account when designing programmes or projects to enable development and peace-building to take place [Hartmann and Kwauk, p289]. In any case, sport alone cannot prevent or alleviate poverty, forced migration, gender-based violence, food insecurity or pandemic disease - only when the SDP activities are designed in consultation with the beneficiaries themselves, and where the sport elements are presented alongside or within other methods to address the root cause of the issues affecting the target community, can sport become the force for good it is often trumpeted as [Giulianotti 2004, p.367]. Football or basketball may be the fun activity that encourages children and young people to take part in a SDP programme the first instance, but ‘the educational experience within the sporting experience is the more critical space in which development is achieved’ [Hartmann and Kwauk p290]. However, SDP’s current and potential beneficiaries are not

only receiving the messages of sport through the programmes they take part in, but they are also receiving them through the media. International sport has long been associated with corruption, defined by Adam Masters as ‘the deviation from public expectations that sport will be played and administered in an honest manner’ [Masters, p.113]. Allegations of corruption at FIFA, which has been carefully researched and documented by Alan Tomlinson and John Sugden among others, came under intense media scrutiny in May 2015 after seven of its top executives were arrested in Zurich following an investigation by the Federal Bureau of Investigation [BBC Sport]. FIFA’s long-running president Sepp Blatter, who was re-elected just days later, has since announced that he will step down from the post once a successor has been chosen, bringing an end to a seventeen-year reign [Sugden and Tomlinson]. The state of FIFA matters far beyond football, with Christina Malliris noting, ‘Soccer may be simply a game; but … it has its feet in international politics, human rights, major business transactions, and many other categories. If the governing body of this sport is not conducting business with integrity, it would certainly have a negative effect on the other things that football is a part of’ [Malliris 2013].

Professional cycling may be less popular globally than football, but the Tour de France attracts an estimated 3.5 billion viewers every year [amo.fr, letour.yorkshire], and one of the world’s most famous sports icons emerged from its peloton. Lance Armstrong rose to the top of the sport in 1999 after surviving testicular cancer and dominated Le Tour with seven consecutive wins before retiring in 2005, and making a triumphant comeback to finish third in the 2009 Tour. But after a US Anti-Doping Agency investigation revealed that his victories had been achieved through doping, he received a lifetime ban from the sport and was stripped of all seven Le Tour titles [USADA, 2013]. A further scandal involving doping emerged in athletics in August 2015, when Germany’s University of Turbingen alleged that the International Association of Athletics Federations had suppressed a study that indicated that as many as a third of the world's leading athletes ‘had admitted violating anti-doping rules’ [BBC Sport, 2015].

Violence among and between rival groups of supporters regularly causes trouble in cities across the world, but it is not a new phenomenon - sport’s potential to have a corrosive and divisive affect on participants and spectators alike has been evident since antiquity. Spectator violence was observed during Greek and Roman times and one of sport’s most vicious rivalries, that between the Blues and the Greens in the circus at Byzantium, led to both factions taking up arms to depose Emperor Justinian. Around 30,000 people were killed in the resulting riots and the military crackdown that followed them [Russell, p.355]. Violent episodes in modern day sport may have far fewer casualties but the death toll and damage caused can still be shocking. More than 300 people were killed in the 1964 Estadio Nacional disaster caused by riots at a match between Argentina and Peru [Hough, p.1290] and, more recently, hooliganism caused the Heysel Stadium disaster where thirty-nine Juventus fans died after a wall collapsed as they were trying to escape from Liverpool hooligans just before kick-off at the 1985 European Cup final [Giulianotti and Klauser, p.315]. Modern-day sporting violence can range from hooliganism during international football championship matches to tension and violence during derby matches in a country’s national league, e.g. Fenerbahce vs. Galatasaray in Turkey, Arsenal vs. Tottenham Hotspur in the UK, Roma vs. Lazio in Italy and Real Madrid vs. Barcelona in Spain. In Eastern Europe, where many SDP programmes are operating in post-conflict areas, a 2012 survey of more than 3,000 professional footballers found that around 12% of those surveyed had experienced violence at the hand of fans, coaches and managers [Economist 2012].

There are strong historic links between war and sport, and these can be observed in the Ancient Greek fascination for the human body and its limits in athletics and conflict; in Socrates and Glaucon comparing the similarities and differences between soldiers and athletes in Plato’s Republic, and in Aristotle drawing analogies between competitive sport and war in his Nicomachean Ethics [Guilianotti and Armstrong, p.381-2]. It can also be noted in the Olympic Truce or ekecheria, signed in the Ninth Century BC to stop localised conflicts, ‘honour the gods’, and allow the Ancient Olympiad to take place without threat to the competitors and spectators converging on the event [Burleson, p.799], and which the UN and the IOC reinstated in 1992 [Burleson, p.781].

In the nineteenth and early twentieth centuries, the British Empire deployed a strategy to harness the sporting ethos of courage, loyalty, fair play and humility forged on public school playing fields and use it to not only transform the British Army [Campbell, p.22], but also to disseminate British imperial values in colonised territories across the world. This process went beyond the assimilation and subjugation of the colonized peoples, with Giulianotti describing it as ‘cultural genocide’, where colonial rulers and missionaries used sport to erase indigenous identities and practices and replace them with an imperial, white, and Christian view of what humanity should be [Giulianotti 2004, p.358]. Decades later, the world saw the ‘symbolic flexing of militarised, nationalist, masculine muscles’ at the 1936 Berlin Olympics [Giulianotti and Armstrong, p.383], and J.A. Mangan extended the sport/militarisation analogy in his 2000 work on fascism, noting, ‘Sport develops muscle and muscle is equated with power – literally and metaphorically. War, the essence of Fascism, demands physical fitness and sport helps promote this fitness. Competitive sport can help develop attitudes of aggression and aggression is essential in war’ [Mangan, p.1].

Sport has been a political and military flashpoint at several points during the past century, such as at the ‘Blood in the Water’ water polo semi-final at the 1956 Melbourne Olympics between Hungary and the USSR just after the Soviet invasion of Hungary [Cha, p.1289]; the ‘Soccer War’ between Honduras and El Salvador in 1969, where political tension between the States was exacerbated by crowd problems during World Cup qualifying matches and resulted in a six-day conflict that killed more than 2,000 people and displaced some 100,000 Salvadorans [Duke University Soccer Blog]; and the May 1990 football match between Yugoslav sides Red Star Belgrade and Dynamo Zagreb, which was halted by violence between the teams’ supporters clubs, and was one of several incidents that precipitated the breakup of Yugoslavia and the ensuing Balkan wars [Sack and Suster, p.311].

However, international sport can also play a significant role in encouraging and maintaining peace between States that have previously been at war, or who exist in a state of political tension. One example is the Greco-Turkish ‘earthquake diplomacy’ that took place when PAOK of Thessalonika played a fundraising friendly match at the home ground of their arch-rivals Galatasaray of Istanbul following the 1999 disaster [Hough, p. 1293]. Sport has played a pacifying role in the complex relationship between North and South Korea, where ‘the cement of sport’ has allowed brief periods of reunification on the playing fields of international events and has encouraged a greater sense of community between athletes and spectators [Van Tassel and Terry, p.820]. In 2008, a World Cup qualifier held in Armenia marked the first visit to Armenia of a modern Turkish leader, the then President Abdullah Gül, for the first discussions in a bid to resolve long-running diplomatic issues such as the reopening of the border between the two nations, which has been closed since the Armenian-Azerbaijan conflict over Nagorno Karabakh in 1993 [The Economist, 2008]. And in 2011, cricket was used to improve relations between Pakistan and India after decades of suspicion and near-conflict. The Prime Minister of India, Manmohan Singh, invited his Pakistani counterpart Yousaf Raza Gilani to attend a Cricket World Cup semi-final between their

respective countries as ‘an attempt to use sport to create a feel-good atmosphere between the two countries at a time when the atmosphere of suspicion and hostility towards Pakistan in India is very strong.’ [Murray, p.583].

History shows us that sport, particularly football, has the ability to unify people, even when they are on opposite sides of the frontline during a conflict. One famous example of this is the Christmas Truce during the First World War, where Allied and German soldiers laid down their weapons on Christmas Day 1914 and played football in No Man’s Land - although historians still disagree about the veracity of this story [Wilson p.199]. Other views encompass the concept of sport as a ‘cathartic alternative to war’, where the nationalist pride and distinctiveness of rival towns, cities and States can be expressed with noise and passion, without threat to life, the social order, or the sovereignty of a nation [Sugden 2010, p.259].

However, the tribalism that is a defining characteristic of sport worldwide has the potential to exacerbate post-conflict tensions, particularly during sporting events between the Balkan countries; India and Pakistan, or China and Japan [Guilianotti and Armstrong, p.381], and football seems to be particularly problematic. In their study on the Open Fun Football Schools in Bosnia, Patrick K. Gasser and Anders Levinsen warned that ‘As a terrain for re-integrating communities polarized by war, football is something like frontline farmland: fertile, but likely to be mined’ [Gasser and Levinsen, p.471]. But Joel Rookwood has argued that the complex nature of sport – and football in particular – is in itself a reason why it is a suitable conduit through which to encourage peace and development, as ‘the fact that soccer can cause conflict renders it suitable for teaching people about resolving conflict’ [Rookwood 2008, p.477].

A further counter view is that SDP sceptics – particularly those who object to its use of competitive sports as a development and peace-building tool – are exhibiting a ‘failure to distinguish between conflict and competition’ and a ‘failure to distinguish between violence and aggression’ [Parry, p.779]. The relationship between sport – especially football - and conflict has been well documented, but its links to peace are less well recognised outside its own international structures and the INGO community [Hough, p.1288]. It can also be argued that sport, by its very nature, helps people to cooperate within a set of rules, and it is this cooperation that leads to greater respect and mutual understanding between players and between people – ‘it is this peacemaking capacity of sport that informs its peacekeeping potential’ [Parry, p.785]. Young men who are at risk of being drawn into violence – or who may have been a combatant during a conflict – are perhaps most in need of support and are more likely to be reached and assisted through the medium of sport, and participation in sport helps to strengthen community connections and build a stronger, more peaceful civil society [Giulianotti and Armstrong, p. 390].

Chapter three – ‘People who work together will win’: using sport in development and peace-building, and proving its impact. ‘People who work together will win, whether it be against complex football defenses, or the problems of modern society.’ – National Football League coach Vince Lombardi. [Quoted in Congressional Record, V. 153, Part 19, October 1, 2007 to October 16, 2007 p.26867.]

Some successful SDP projects, such as the Open Fun Football Schools and Football 4 Peace referred to in chapter one, have embraced the ambiguities of competitive sport and used its more controversial aspects to teach young people about the importance of learning to lose gracefully as well as striving to win. Additionally, while a focus on fielding mixed-ethnicity

teams to encourage cross-community collaboration and respect within the framework of a sports match shows that competition can be utilised to good effect, ‘building relationships and integrating values within the sport should be the focus, not the sport itself’ [Rookwood 2008, p.476-7]. Political influences must also be kept in mind because sport, as a malleable social construction, will always be vulnerable to politicisation by the social forces at work where it is being played [Sugden 2010, p.262]. This is of particular concern in post-conflict contexts. In its handbook on Sport in Post-Conflict Societies, the Council of Europe’s Enlarged Partial Agreement on Sport mechanism notes that sport, in post-conflict or otherwise fragile societies, is not always seen as the fun, neutral, unifying activity often described by SDP organisations, and that it can be ‘influenced or sometimes even hijacked by the conflict or the conflict parties’ [EPAS/CoE p.63].

Current research indicates that while sport can be used as part of a raft of interventions such as leadership training, peer education and other life skills to improve behaviour in children and young people, participation in sport in and of itself does not prevent or reduce aggressive behaviour, and any sport-related programme should focus on tailored and supportive ‘bottom-up’ approaches where the importance of winning is downplayed [sportanddev.org]. To improve the chances of a successful outcome, each programme should be carefully tailored to ensure that the type of sporting activity is ‘culturally significant in the location in question’, and ensure that the local context and conditions are suitable for a sports-based intervention before introducing sport – especially football – into a post-conflict or developing community [Rookwood and Palmer, p.187]. The dignity and needs of the young people involved in SDP projects should also prioritised, as children and youth need to feel safe, supported, valued, connected to their peers and community, and personally and politically empowered in order to thrive and overcome disadvantage [Coakely, p.26-27]. In this way, sports-based interventions have an opportunity to stress the positive, cooperative and inclusive elements of sport while avoiding its aggressive and hierarchal aspects, which have been documented in academic studies across a number of disciplines. A study was conducted in 1960s Oklahoma where a group of twelve-year-old boys were first allowed to form friendships and were then separated at random into two sports teams, which were given their own clubhouse, team strip and name. When the two teams were stopped from playing together for fun and formal competition was introduced, ‘the initial playful and good sport behaviors were increasingly displaced by open hostility. Sport competition demonstrably promoted intergroup conflict’. An attempt to replicate this study in 1970 had to be abandoned after members of one team knifed some members of the other [Shields and Bredemeier, p.371]. Three years later, US anthropologist Richard Sipes studied the differences between warlike and peaceful societies and the prevalence of competitive sport in each, and concluded that team sports do not act as a safe alternative to conflict and wrote that ‘the hope would seem dim of using sports to influence warfare, or any of the other forms of undesirable aggressive behaviour’ [Youngs, p.192].

Shields and Bredemeier, in their studies in sport and aggression, recommend that practitioners seeking to use sport in peace-building and conflict resolution keep five key issues in mind when designing and delivering their programmes: that competition can encourage hostility, cheating and aggression; that participation in sport causes moral perspectives to change; the social construction of masculinity; sport’s role in creating and enforcing class, race and gender hierarchies, and the similarities and differences between sport and societal processes [Shields and Bredemeier, p.378]. There have been success stories over the past two decades of growth in SDP – including the examples noted in chapter one – and yet sport’s usefulness as a development and peace-

building tool remains hard to prove. While it has demonstrably touched the lives of many children and young people in the developing world, ‘it is also woefully under-funded, highly uncoordinated and completely unregulated’ [Kidd 2008, p.371]. And although SDP has been firmly rooted in the INGO/NGO international development sector since its inception, it ‘still lacks the programmatic and methodological sophistication of the older development industry’ [Cornellisen, p.507]. At present, in spite of the growth of SDP over the past two decades, there is still a lack of published, peer-reviewed literature on sport, development and peace-building, and existing literature is ‘mainly practitioner-led … largely descriptive, and unrelated to many of the evaluation techniques employed by development agencies’ [Levermore 2008, p.189]. Beneficiary voices are rarely heard outwith the confines of the NGO case study, and non-anecdotal evidence of the efficacy of the programmes can be hard to find. As a result, ‘beliefs about the impact of sport in development are driven mainly by heartfelt narratives, evocative images, and quotable sound bites of individual and community transformation, packaged and delivered more often than not by those running the programmes’ [Hartmann and Kwauk p. 285-286]. The wider SDP movement still lacks the benchmarking that would be needed for a detailed analysis of how, or even if, these programmes are changing their beneficiaries’ lives for the better. In addition, there has been little analysis of whether competitive sport – identified as a potentially problematic cultural phenomenon in chapter two - is a suitable medium through which to achieve peaceful, developed communities. Sport’s popularity makes it appealing to national and international organisations working in development and conflict resolution, as it can be used to encourage people, particularly children, to take part in educational programmes or projects. But sport alone will not achieve the societal or developmental goals of such projects if care is not taken to ensure the programmes are locally-owned and driven, as development cannot be imposed on a community by outsiders and must be driven from within [Geleta 2014]. The programmes must also be appropriate to the culture and needs of the intended beneficiaries, and robust measures should be in place to ensure adequate monitoring and evaluation [Kidd 2011]. Monitoring and evaluation (M&E) systems are an integral part of NGO and INGO work, and are designed to not only demonstrate impact and value for money to the many investors and stakeholders scrutinising each programme and activity, but also to act as evidence of good practice or failed approaches and add to the shared knowledge of development and aid practitioners. M&E reports published by SDP organisations are ‘thus the most visible mechanisms for making “recipients” of sport in development support accountable to its “donors”’ [Kay 2012, p.890-891].

The need for better evaluation has been evident for many years. UNICEF noted in 2006 that data was needed in place of ‘what is mostly anecdotal evidence’ offered to justify programmes that operate under ‘a “trial and error” system without articulating clear development goals’ [Levermore 2011, p.340], and the World Bank described sport as a ‘promising but unproven’ tool for development and peace in its 2007 World Development Report [World Bank, p.141]. This ongoing lack of evidence or theory-based explorations of SDP’s aims, methods and impact has been criticised by academics including Fred Coalter, who notes that ‘many of the claims of the conceptual entrepreneurs of sport-for-development are not supported by robust research evidence, or even coherent theory-based explanations’, and argues that SDP’s assertions of developmental and social impact can be directly challenged by an existing body of research into sport and its effects on participating individuals [Coalter 2013, p.4]. To address the issue, Nico Schulenkorf has proposed that the planning, implementation and evaluation of SDP programmes be guided by a framework that shows short-term and long-term social change by ‘integrating and visualising the social

processes generated through participatory sport activities’ [Schulenkorf, p.7], but notes that, without a sector-wide agreement on Key Performance Indicators that are flexible and generic enough to apply across different contexts, the SPD sector will continue to lack a solid evidential base for its work [Schulenkorf, p.9]. The movement’s ability to achieve its goals in development and peace has also been criticised for its short-termism and self-interest. Large numbers of SDP NGOs are competing for visibility and the donor money that follows it, and may work towards their own agendas without also helping to build the capacities of the host countries’ health and education systems in a way that would ensure greater sustainability of the gains from their projects and programmes [Kidd 2008, p.376]. For example, Liberia’s Don Bosco football projects, which included child protection as well as training and support for vulnerable children and young people affected by civil war, was a locally-run enterprise supported by UNICEF and which ran successfully for many years before being disrupted by fighting in 2003. In 2001, an international agency from the Global North announced that it would also run community football programmes for children. Bosco project coordinator Father Joe Glackin voiced his concern about how the short-term goals and Western practices of the foreign agency could affect the Liberian children making good progress through the Bosco projects: ‘They’ll … give out footballs willy-nilly and have photos taken of kids with balls for their brochures. After six months it’ll all end, the balls will burst, or get lost and there won’t be any replacements. The kids meanwhile get the idea that what they want some Western agencies will get for them – free. Some NGOs are without shame - they start an idea, spend a fortune in the short term, and don’t follow it through’ [Armstrong p.495-6]. Concerns have also been expressed at SDP’s track record of addressing gender issues, although programmes addressing the intersection of gender, conflict, violence and development, including those in the African continent focused on ‘girl only’ participation, have grown in popularity in recent years. In early 2008, only 30 of 264 SDP projects listed on the International Platform on Sport and Development were incorporating gender issues. The following year it was estimated that 42.5% of more than a thousand SDP projects were specifically targeting girls and women, leading to calls for more ‘careful consideration’ of how such projects are conceptualised [Chawansky and Hayhurst, p.877]. Studies indicate that gender-based and domestic violence and discrimination continues to be a growing problem in Sub-Saharan Africa and elsewhere, and it is argued that SDP programmes designed to empower girls and young women can only succeed if they first understand how inequalities and hierarchies of power have created these vulnerabilities before seeking to address them [Hayhurst et al., p.165].

As SDP organisations and their staff are usually from the Global North, and their work is mostly carried out in the Global South, for beneficiaries in countries and regions affected by conflict, crisis, or natural disaster [Guilianotti and Armstrong, p.208], concerns have also been raised about SDP’s role in reinforcing the power dynamics that have shaped North-South relations since the colonial era [Guilianotti 2010, p.290]. As noted in chapter two, sport was once used in British boarding schools and universities to impress upon the children of the imperial elite how they should behave on and off the playing field, and which values they should embody, before they were sent to the colonies to disseminate these values to the indigenous peoples under their control [Girginov, p.110]. Correspondingly, one challenge for SDP practitioners is how best to avoid the ‘messages of Southern cultural inferiority and Northern domination’ that can persist in North-South development contexts, where donors and NGOs position ‘the North as the benevolent, educated development worker and the South (specifically the African continent) as the poverty stricken and disease-ridden child in need of salvation’ [Nicholls et al, p.250]. It should be kept in mind that young people living in post-

conflict societies are not only recovering from the effects of war, but can also experience frustration at being excluded, by adults, from the recovery and reconstruction of their communities [Rookwood and Palmer, p.187], and they should not be treated as passive recipients of aid but as fully empowered members of the development process. There is also an assumption that everyone loves sport and not only wants to take part in it, but is also allowed to take part in it – which could be a limiting view when trying to offer equal opportunities to girls and people living with disabilities [Cornellisen, p.507].

It has been argued that today’s global sporting institutions, brands and corporate giants – all active in SDP, as noted in chapter two - could only have emerged from within modern capitalism and, as such, ‘contemporary sport remains implicated in the western hegemony of global institutions and international relations’ [Darnell and Hayhurst, p.185]. This association could damage the SDP movement’s claims that the universal language of sport speaks to all the peoples of the world in the same way, and with the same implications, especially in its programmes in the Global South. The bias towards practices and standards established in the Global North also extends to the methods used to assess SDP programmes, with evidence of ‘one size fits all’ approaches being taken and concerns that the process is ‘wielded and constrained by a range of vested interests’ [Harris and Adams, p.8]. Tess Kay warns that ‘much of the current critique of sport-in-development research derives from assessments that were initially undertaken, not for international sport-in-development research, but for research into the social impact of sport in western settings’, and that this reliance on an assumed universality of methodology could lead to local SDP voices – both beneficiary and practitioner – being shouted down, or not heard at all [Kay 2009, p.1189].

In addition, to date, there has arguably been little attention paid by academics to the strengths and weaknesses of the pedagogical approaches currently being utilized in education through sport in the Global South and whether these are appropriate for the stated aims of SDP programmes [Spaaij and Jeanes, p.443]. And without careful consideration of what such programmes hope to achieve, and how, and to whose benefit, this power imbalance could lead to the knowledge and skills of practitioners in the South being marginalized in favour of a top-down ‘Western’ view of what the programme’s beneficiaries need [Nicholls et at, p261]. The SDP sector is also accused of driving neoliberal agendas through its work by imposing a Western view of how people should be living, where ‘sport is assumed to level the playing field by giving individuals and communities a fair chance at looking and behaving like those in more affluent (and “developed”) settings’ [Hartmann and Kwauk 288-289], instead of creating safe culturally-appropriate spaces in which development and peaceful living can be encouraged. Such concerns have led to calls for greater understanding within the SDP movement of the complexities of operating in the Global South, particularly in countries that are still recovering from colonisation, and the need to fully address issues of gender, race and class within SDP programmes. If not, attempts to use sport to boost development in such contexts ‘may be taken up in the construction and maintenance of Whiteness and racial dominance’ [Darnell and Hayhurst p.190]. As a result, SDP organisations working in the Global South, while remaining aware of their ‘responsibility to work our magic with sports but within the constructs of the culture’, should be also be aware of ‘the dangers of imparting our own morals, values and ethics on others’ cultural norms’ [Gilbert and Bennett, p.484]. This lack of critical evaluation of SDP programme outcomes and their long-term benefits has not diminished claims that sport is an inherently good way to encourage development and peaceful living, nor dented international enthusiasm for the SDP movement. Tess Kay notes that while this dearth of credible evidence does not support the many colourful and excitable

claims made about the benefits of sport – whether in the international development and peace context, or the wider cultural ones - ‘the absence of robust data does not in itself disprove the actual or potential value of sport’ [Kay 2009, p.1178].

Conclusion ‘Sport has the power to change the world. It has the power to inspire, it has the power to unite people in a way that little else does. It speaks to youth in a language they understand. Sport can create hope, where once there was only despair. It is more powerful than governments in breaking down racial barriers. It laughs in the face of all types of discrimination.’ – Nelson Mandela. [Quoted during his speech at the Inaugural Laureus Lifetime Achievement Award, Monaco, 2000.]

From my study of SDP-related academic research and INGO/NGO reports, including the plans to officially designate sport as a tool for development and peace within the post-MDG Sustainable Development Agenda, it is clear that there is a widely-recognised role for sport as positive driver of change in health, education, post-conflict reconciliation, greater equality and opportunity for girls and people living with disabilities, and other activities to boost development and encourage peaceful living. However, there is still little concrete evidence that this approach makes a lasting and sustainable contribution to the development and peace sectors, and much of the available literature is notable for what Richard Giulianotti has described as ‘the more naive or evangelical arguments regarding sport’s innate goodness’ [Giulianotti 2004, p367]. It can be argued that, as peace-building is a long process that begins in early recovery from conflict and requires the targeted and collaborative efforts of the affected State, the international community, INGOs and international and national civil society to ensure stable reconstruction, ‘sport alone cannot bring about peace’, but ‘it is an efficient, flexible and multi-versatile instrument in the larger toolkit of peace-building and reconciliation measures’ [Dienes p.49]. Sport’s historical links to war, its associations with corruption and cheating, and its linkages with violence on and off the field, particularly in football, are reminders that both positive and negative outcomes are a possibility in SDP programmes. The influence of politics both in sport and in developing and post-conflict contexts must also be taken into consideration, as should ‘the possibility that the use of sport as a peacemaking tool may actually backfire, and may serve to extend rather than undermine social conflicts’ [Guilianotti and Armstrong, p.381]. But sport can also inspire people to coalesce around the possibility of peaceful, dignified, independent living, and this can only be achieved when social and cultural engagement encourages significant numbers of people to worth together to resolve conflicts and address inequalities [Sugden 2010, p.268]. With sport now included in the UN’s post-2015 Sustainable Development Agenda – item thirty-seven is ‘Sport is also an important enabler of sustainable development. We recognize the growing contribution of sport to the realization of development and peace in its promotion of tolerance and respect and the contributions it makes to the empowerment of women and of young people, individuals and communities as well as to health, education and social inclusion objectives’ [UN 2015] – there will be increased pressure on the SDP sector to show how its programmes are contributing to development and peace, and robust monitoring and evaluation measures will be needed to replace the largely anecdotal evidence that arguably makes up much of the current evidence base [sportanddev 2015]. This may be challenging for many organisations and researchers – many of whom will be from the Global North - to

accurately assess and evaluate SDP programmes in the Global South, and cultural elements of the research process will need to be carefully addressed [Kay 2009, p.1117]. But without precise data on what the programmes are doing, who they are helping, and how they are helping – as noted in this chapter - SDP organisations may not meet the increasingly high expectations of beneficiaries and donors, and will be unable to adjust and finesse their programmes to ensure that they are fit for purpose [Cornelissen, p. 526]. They may also find it difficult to prove that SDP is having a sustainable, measureable, and long-term positive impact on global efforts to achieve development and peace in disadvantaged, fragile and post-conflict communities worldwide.

It would appear that much more academic research is needed to understand what SDP and sport in general can offer in both developing and post-conflict contexts when compared to traditional development and peace-building methods. Academia can explore the value of SDP programmes and organisations in terms of their efficacy; the amount of scrutiny from donors and other stakeholders; the way they prove their impact, and the sustainability of any gains they bring to their beneficiaries. Finding answers to these questions will be increasingly important, not only in terms of the post-2015 Sustainable Development Goals, but also in how humanity is able to find a universal language to help understand and address the many challenges of cross-cultural understanding, tolerance and integration that currently exist in stable and post-conflict regions, and in the developing and developed world alike.

Bibliography Armstrong, Gary. (2004) ‘The Lords of Misrule: Football and the Rights of the Child in

Liberia, West Africa.’ Sport in Society: Cultures, Commerce, Media, Politics 7:3 pp. 473-502

Beacom, Aaron. (2014) ‘Sport for development and peace: a critical sociology.’ Sport in Society: Cultures, Commerce, Media, Politics, 17:2, pp. 274-278

Beck, Peter J. (2013) ‘“War Minus the Shooting”: George Orwell on International Sport and the Olympics.’ Sport in History, 33:1 pp. 72-94

Beutler, Ingrid. (2008) ‘Sport serving development and peace: Achieving the goals of the United Nations through sport.’ Sport in Society: Cultures, Commerce, Media, Politics, 11:4, pp. 359-369

Black, David R. (2010) ‘The ambiguities of development: implications for “development through sport”.’ Sport in Society: Cultures, Commerce, Media, Politics, 13:1, pp. 121-129

Bodin, Dominique and Robène, Luc. (2014) ‘Sport and Civilisation: Violence Mastered. From the Lack of a Definition for Violence to the Illusory Pacifying Role of

Modern Sports.’ The International Journal of the History of Sport, 31:16 pp. 1939-1955 Boje, David M. and Khan, Farzad R. (2009) ‘Story-Branding by Empire Entrepreneurs: Nike,

Child Labour, and Pakistan’s Soccer Ball Industry.’ Journal of Small Business & Entrepreneurship, 22:1, pp. 9-24

Burleson, Cindy. (2012) ‘The ancient Olympic Truce in modern-day peacekeeping: revisiting Ekecheiria.’ Sport in Society: Cultures, Commerce, Media, Politics, 15:6, pp. 798-813

Campbell, JD. (2000) ‘‘Training for sport is training for war’: sport and the transformation of the British army, 1860–1914.’ The International Journal of the History of Sport, 17:4, pp. 21-58

Cárdenas, Alexander. (2013) ‘Peace Building Through Sport? An Introduction to Sport for Development and Peace.’ The Journal of Conflictology, 4:1 pp. 24-33.

Cha, Victor D. (2013) ‘Winning is Not Enough: Sport and Politics in East Asia and Beyond.’ The International Journal of the History of Sport, 30:11, pp. 1287-1298

Chawansky, Megan. (2011) ‘New Social Movements, Old Gender Games? Locating Girls in the Sport for Development and Peace Movement.’ Research in Social Movements, Conflict and Change 32 pp. 121-13

Chawansky, Megan and Hayhurst, Lyndsay M.C. (2015) ‘Girls, international development and the politics of sport: introduction.’ Sport in Society 18:8, pp. 877-881

Coakley, Jay. (2002) ‘Using sports to control deviance and violence among youths: let’s be critical and cautious.’ In Gatz, Margaret; Messner, Michael A. and Ball-Rokeach, Sandra J. (eds) Paradoxes of Youth and Sport. State University of New York Press.

Coalter, Fred. (2010) ‘Sport-for-development: going beyond the boundary?’ Sport in Society: Cultures, Commerce, Media, Politics 13:9, pp. 1374-1391

Coalter, Fred. (2010) ‘The politics of sport-for-development: Limited focus programmes and broad gauge problems?’ International Review for the Sociology of Sport 45:3 pp. 295-314

Coalter, Fred. (2013) ‘Sport for Development: What game are we playing?’ Routledge.

Cooley, Laurence and Mujanović, Jasmin. (2015) ‘Changing the Rules of the Game: Comparing FIFA/UEFA and EU Attempts to Promote Reform of Power-Sharing Institutions

in Bosnia-Herzegovina.’ Global Society, 29:1, pp. 42-63 Cornelissen, Scarlett. (2011) ‘More than a Sporting Chance? Appraising the sport for

development legacy of the 2010 FIFA World Cup.’ Third World Quarterly 32:3, pp. 503-529

Council of Europe. (2011) ‘Handbook on Good Practices: Sport in Post-Conflict Societies.’ Darnell, Simon C. and Black, David R. (2011) ‘Mainstreaming Sport into International

Development Studies.’ Third World Quarterly, 32:3, pp. 367-378 Darnell, Simon C. and Hayhurst, Lyndsay M.C. (2011) ‘Sport for decolonization: exploring a

new praxis of sport for development.’ Progress in Development Studies 11:3 (2011) pp. 183-96

Darnell, Simon. (2013) ‘Sport for Development and Peace: A Critical Sociology.’ Bloomsbury.

Darnell, Simon C. (2014) ‘Orientalism through sport: towards a Said-ian analysis of imperialism and ‘Sport for Development and Peace’.’ Sport in Society: Cultures, Commerce, Media, Politics, 17:8, pp. 1000-1014

Dichter, Heather and Johns, Andrew L. (2014) ‘Diplomatic Games: Sport, Statecraft and International Relations Since 1945.’ University of Kentucky Press.

Dienes, Eric. ‘How Sport Can Contribute to Peace-Building: Perspectives of the United Nations on Sport as a Tool for Promoting Peace.’ In Gilbert, Keith and Bennett, Will. (eds) (2012) Sport, Peace and Development. Common Ground Publishing.

Donnelly, Atkinson, Boyle and Szto. (2011) ‘Sport for Development and Peace: a public sociology perspective.’ Third World Quarterly, 32:3, pp. 589-601

Dyck, Christopher B. (2011) ‘Football and Post-War Reintegration: exploring the role of sport in DDR processes in Sierra Leone.’ Third World Quarterly, 32:3, pp. 395-415

Edwards, Michael B. (2015) ‘The role of sport in community capacity building: An examination of sport for development research and practice.’ Sport Management Review 18 pp. 6-19

Fischer, Norman. (2002) ‘Competitive sport’s imitation of war: Imaging the completeness of virtue.’ Journal of the Philosophy of Sport, 29:1 pp.16-37.

Forde, Shawn D. (2013) ‘Fear and loathing in Lesotho: An autoethnographic analysis of sport for development and peace.’ International Review for the Sociology of Sport 0:0, pp. 1-16

Gasser, Patrick K. and Levinsen, Anders. (2004) ‘Breaking Post-War Ice: Open Fun Football Schools in Bosnia and Herzegovina.’ Sport in Society: Cultures, Commerce, Media, Politics, 7:3, pp. 457-472

Geleta, Bekele. (2014) ‘Reflections of a Secretary General 2008-2014.’ International Federation of Red Cross and Red Crescent Societies.

Gems, Gerald R. (1999) ‘Sports, war, and ideological imperialism.’ Peace Review: A Journal of Social Justice, 11:4, pp. 573-578

Girginov, Vassil. (2003) ‘Sport, society and militarism - in pursuit of the democratic soldier: J.A. Mangan's exploration of militarism.’ The International Journal of the History of Sport, 20:4, pp. 90-117

Giulianotti, Richard. (2004) ‘Human Rights, Globalization and Sentimental Education: The Case of Sport.’ Sport in Society: Cultures, Commerce, Media, Politics 7:3 pp. 355-369

Giulianotti, Richard. (2011) ‘Sport, peacemaking and conflict resolution: a contextual analysis and modelling of the sport, development and peace sector.’ Ethnic and Racial Studies, 34:2, pp. 207-228

Giulianotti, Richard. (2011) ‘The Sport, Development and Peace Sector: A Model of Four Social Policy Domains.’ The Journal of Social Policy, 40:4, pp. 757-776

Giulianotti, Richard and Armstrong, Gary. (2011) ‘Sport, the Military and Peacemaking: history and possibilities.’ Third World Quarterly, 32:3, pp. 379-394

Giulianotti, Richard. (2011) ‘Sport, Transnational Peacemaking, and Global Civil Society: Exploring the Reflective Discourses of ‘”Sport, Development, and Peace” Project Officials.’ Journal of Sport and Social Issues, 35:1 pp. 50-71

Gray, Juneau and Rubin, Neal S. (2012) ‘The Olympic Truce: Sport promoting peace, development and international cooperation.’ American Psychology Association, Psychology International http://www.apa.org/international/pi/2012/10/un-matters.aspx

Griffin, Murray. (1996) ‘Aggression in Sport: Inevitable, Avoidable, or a Matter of Semantics?’ Peace and Conflict: Journal of Peace Psychology, 2:4, pp. 385-386

Harris, Kevin and Adams, Andrew. (2015) ‘Power and discourse in the politics of evidence in sport for development.’ Sport Management Review, http://dx.doi.org/10.1016/j.smr.2015.05.001

Hartmann, Douglas and Kwauk, Christina. (2011) ‘Sport and Development: An Overview, Critique, and Reconstruction.’ Journal of Sport and Social Issues 35:3 pp. 284-305

Hasselgård, Anders. (2015) ‘Norwegian Sports Aid: Exploring the Norwegian ‘Sport for Development and Peace’ Discourse.’ Forum for Development Studies, 42:1, pp. 1-25

Hayhurst, Lyndsay M.C.; MacNeil, Margaret; Kidd, Bruce and Knoppers, Annelies (2014). ‘Gender relations, gender-based violence and sport for development and peace: Questions, concerns and cautions emerging from Uganda.’ Women's Studies International Forum 47, pp. 157–167

Höglund, Kristine and Sundberg, Ralph. (2008) ‘Reconciliation through Sports? The case of South Africa.’ Third World Quarterly, 29:4, pp. 805-818

Hough, Peter. (2008) ‘‘Make Goals Not War’: The Contribution of International Football to World Peace.’ The International Journal of the History of Sport, 25:10, pp. 1287-1305

Houlihan, Barrie, and Giulianotti, Richard. (2012). ‘Politics and the London 2012 Olympics: the (in)security Games’. International Affairs 88 pp.701–717.

International Olympic Committee. (2015) ‘The Contribution of Sport to the Sustainable Development Goals and the post-2015 Development Agenda.’

Kaldor, Mary. (2012) ‘New and Old Wars: Organized Violence in a Global Era.’ Third edition. Stanford University Press.

Kay, Tess. (2009) ‘Developing through sport: evidencing sport impacts on young people.’ Sport in Society: Cultures, Commerce, Media, Politics 12:9, pp. 1177-1191

Kay, Tess. (2012) ‘Accounting for legacy: monitoring and evaluation in sport in development relationships.’ Sport in Society: Cultures, Commerce, Media, Politics 15:6 pp. 888-904

Keech, Marc and Houlihan, Barrie. (1999) ‘Sport and the end of apartheid.’ The Round Table: The Commonwealth Journal of International Affairs 88:349, pp. 109-121

Kidd, Bruce. (2008) ‘A new social movement: Sport for development and peace.’ Sport in Society: Cultures, Commerce, Media, Politics, 11:4, pp. 370-380

Kidd, Bruce. (2011) ‘Cautions, Questions and Opportunities in Sport for Development and Peace.’ Third World Quarterly, 32:3, pp. 603-609

King, Samantha. (2008) ‘Offensive Lines: Sport-State Synergy in an Era of Perpetual War.’ Cultural Studies ↔ Critical Methodologies: Online. DOI: 10.1177/1532708608321575

Kuper, Simon. (1994) ‘Football Against The Enemy.’ Orion Books. Levermore, Roger. (2008) ‘Sport: a new engine of development?’ Progress in Development

Studies 8:2 pp. 183-90 Levermore, Roger. (2010) ‘CSR for Development Through Sport: examining its potential and

limitations.’ Third World Quarterly 31:2 pp. 223-241 Levermore, Roger. (2011) ‘Evaluating sport-for-development: approaches and critical issues.’

Progress in Development Studies 11:4 pp. 339–53 Lyras, Alexis and Welty Peachy, Jon. (2011) ‘Integrating sport-for-development theory and

praxis.’ Sport Management Review 14 pp. 311-326 Mangan, J.A. (2000) ‘Superman Supreme: Fascist Body as Political Icon - Global Fascism.’

Routledge. Mason, Tony and Riedi, Eliza. (2010) ‘Sport and the Military: The British Armed Forces

1880-1960.’ Cambridge University Press. Masters, Adam. (2015) ‘Corruption in sport: From the playing field to the field of policy.’

Policy and Society 34 pp. 111–123 Milton-Smith, John. (2002) ‘Ethics, the Olympics and the Search for Global Values.’ Journal

of Business Ethics 35:2 pp. 131-142 Mokleiv Nygård, Håvard and Gates, Scott. (2013) ‘Soft power at home and abroad: Sport

diplomacy, politics and peace-building.’ International Area Studies Review 16:3, pp. 235-243

Ndee, Hamad S. (2000) ‘Sport in Africa: western influences, British middle‐class educationalists and the diffusion of adapted athleticism in Tanzania.’ The International Journal of the History of Sport, 17:1, pp. 69-93

Olusegun Majaro-Majesty, Henry. (2011) ‘Ethnicity, conflict and peace-building: effects of European football support in Nigeria.’ Soccer & Society 12:2, pp. 201–211

Österlind, Malin and Wright, Jan. (2014) ‘If sport's the solution then what's the problem? The social significance of sport in the moral governing of ‘good’ and ‘healthy’ citizens in Sweden, 1922–1998.’ Sport, Education and Society 19:8, pp. 973-990

Parry, Jim. (2012) ‘The power of sport in peacemaking and peacekeeping.’ Sport in Society: Cultures, Commerce, Media, Politics, 15:6, pp. 775-787

Pigman, Geoffrey Allen. (2014) ‘International Sport and Diplomacy's Public Dimension: Governments, Sporting Federations and the Global Audience.’ Diplomacy & Statecraft 25:1, pp. 94-114

Pigman, Geoffrey Allen and Rofe, J. Simon. (2014) ‘Sport and diplomacy: an Introduction.’ Sport in Society: Cultures, Commerce, Media, Politics 17:9 pp. 1095-1097

Robène, Luc and Bodin, Dominique. (2014) ‘Sports and Violence Reflected in the Mirror of Modern Societies: Sport Ambiguities.’ The International Journal of the History of Sport, 31:16, pp.1956-1974

Rofe, J. Simon. (2014) ‘It is a squad game: Manchester United as a diplomatic non-state actor in international affairs.’ Sport in Society: Cultures, Commerce, Media, Politics 17:9 pp. 1136-1154

Rookwood, Joel. (2008) ‘Soccer for Peace and Social Development.’ Peace Review: A Journal of Social Justice 20 pp. 471-479

Rookwood, Joel and Palmer, Clive. (2011) ‘Invasion games in war-torn nations: can football help to build peace?’ Soccer & Society 12:2, pp. 184-200

Russell, Gordon W. (2004) ‘Sport riots: A social-psychological review.’ Aggression and Violent Behaviour 9:4 pp. 353-378

Sack, Allen L. and Suster, Zeljan. (2000) ‘Soccer and Croatian Nationalism: A Prelude to War.’ Journal of Sport and Social Issues 24:3, pp. 305-320.

Sacks, David N.; Petscher, Yaacov; Stanley, Christopher T. and Tenenbaum, Gershon (2003). ‘Aggression and violence in sport: Moving beyond the debate.’ International Journal of Sport and Exercise Psychology 1:2, pp. 167-179

Sanders, Ben; Phillips, Julie and Vanreusel, Bart. (2014) ‘Opportunities and challenges facing NGOs using sport as a vehicle for development in post-apartheid South Africa.’ Sport, Education and Society 19:6 pp. 789-805

Schulenkorf, Nico. (2012) ‘Sustainable community development through sport and events: A conceptual framework for Sport-for-Development projects.’ Sport Management Review 15 pp. 1-12

Shields, David Lyle Light and Bredemeier, Brenda Jo Light (1996) ‘Sport, Militarism, and Peace.’ Peace and Conflict: Journal of Peace Psychology, 2:4, pp. 369-383

Smit, Barbara. (2006) ‘Pitch Invasion: Adidas, Puma and the Making of Modern Sport.’ Penguin.

Spaaij, Ramón. (2012) ‘Olympic rings of peace? The Olympic movement, peace-making and intercultural understanding.’ Sport in Society: Cultures, Commerce, Media, Politics, 15:6, pp. 761-774

Spaaij, Ramón and Jeanes, Ruth. (2013) ‘Education for social change? A Freirean critique of sport for development and peace.’ Physical Education and Sport Pedagogy 18:4 pp. 442-457

Sugden, John and Tomlinson, Alan. (2003) ‘Badfellas: FIFA Family at War.’ Mainstream Press.

Sugden, John. (2006). ‘Teaching and playing sport for conflict resolution and co-existence in Israel.’ International Review for the Sociology of Sport, 41:2, pp. 221-240.

Sugden, John. (2010) ‘Critical left-realism and sport interventions in divided societies.’ International Review for the Sociology of Sport 45:3 pp. 258-272

Sugden, John. (2015) ‘Assessing the sociology of sport: On the capacities and limits of using sport to promote social change.’ International Review for the Sociology of Sport, 50:4-5, pp. 606 – 611

Tiessen, Rebecca. (2011) ‘Global Subjects or Objects of Globalisation? The promotion of global citizenship in organisations offering sport for development and/or peace programmes.’ Third World Quarterly, 32:3, pp. 571–587

United Nations. (2005) ‘Report on the International Year for Sport and Physical Education.’

United Nations. (2006) ‘Sport as a means to promote education, health, development and peace: Resolution 61/10.’

United Nations. (2011). ‘Building a peaceful and better world through sport and the Olympic ideal: Resolution 66/5.’

United Nations. (2015) ‘Millennium Development Goals Report 2015.’ UNICEF. (2006) ‘Workshop report: Monitoring and evaluation for sport-based programming

for development: Sport recreation and play.’ Van Tassell, Darin H. and Terry, Dené A. (2012) ‘An overlooked path to peace and stability:

sport, the state and the case of the Koreas.’ Sport in Society: Cultures, Commerce, Media, Politics, 15:6, pp. 814-822

Voet, Willy. (2002) ‘Breaking The Chain: Drugs and Cycling, the True Story.’ Yellow Jersey Press.

Wilson, Ross J. (2014) ‘It still goes on: football and the heritage of the Great War in Britain.’ Journal of Heritage Tourism 9:3 pp. 197-211

World Bank. (2006) ‘World Development Report 2007 – Youth Development.’ World Bank. Youngs, Alfred. (1986) ‘War on the Terraces.’ Medicine and War, 2:3 pp. 187-194

Online sources

adidas. (2015) ‘Sustainability Report 2014.’ http://www.adidas-group.com/media/filer_public/e8/32/e832823b-8585-4e26-8990-

07b80e3ae71c/2014_sustainability_report_make_a_difference.pdf (accessed 13 August 2015)

Amaury Sport Organisation. (2015) Tour de France. http://www.aso.fr/us/tour-de-france.html (accessed 14 August 2015)

Annan, Kofi. (2010) Speech to the SportAccord International Convention, Dubai, 29 April 2010. http://kofiannanfoundation.org/sites/default/files/20100429%20sport%20sport%20accord%20DUBAI.pdf (accessed 25 August 2015)

BBC News. (2015) ‘IAAF accused of suppressing athletes' doping study.’ http://www.bbc.co.uk/sport/0/athletics/33948924 (accessed 15 August 2015)

The Economist (2012) ‘Violence in Football: An Ugly Game.’ http://www.economist.com/blogs/gametheory/2012/04/violence-football (accessed 16 August 2015)

FIFA. (2015) ‘Football For Hope.’ http://www.fifa.com/sustainability/football-for-hope.html (accessed 13 August 2015)

Football 4 Peace International (2015) http://www.football4peace.eu/ (accessed 13 August 2015)

International Committee of the Red Cross. (2014) ‘Afghanistan: Wheelchair basketball players achieve the impossible dream.’ https://www.icrc.org/eng/resources/documents/feature/2014/05-19-afghanistan-wheelchair-basketball-national-team.htm (accessed 15 August 2015)

International Committee of the Red Cross. (2015) ‘Our Partners.’ https://www.icrc.org/eng/donations/partners/our-partners-secton-overview.htm (accessed 15 August 2015)

‘Le Tour de France facts and figures’ (2013). http://letour.yorkshire.com/news/tour-de-france-the-facts

Magnowski, Daniel. (2011) ‘Taliban death stadium reborn as Afghan sporting hope.’ Reuters http://www.reuters.com/article/2011/12/15/us-afghanistan-stadium-taliban-idUSTRE7BE0LB20111215 (accessed 6 August 2015)

Malliris, Christina. (2013) ‘The Dark Side of FIFA: Selected controversies and the future of accountability in the organisation.’ World Cup 2014, Soccer Politics Blog http://sites.duke.edu/wcwp (accessed on 22 August 2015).

Manchester United (2015) ‘United for Unicef.’ http://www.mufoundation.org/Charities/UnitedForUnicef2.aspx (accessed 13 August 2015)

Mandela, Nelson. (2000) Speech at the Inaugural Laureus Lifetime Achievement Award, Monaco. http://www.sweetspeeches.com/s/2474-nelson-mandela-speech-by-nelson-mandela-at-the-inaugural-laureus-lifetime-achievement-award-monaco-2000 (accessed 22 July 2015)

Open Fun Football Schools (2015) http://ccpa.eu/what-we-do/open-fun-football-schools/ (accessed 1 August 2015)

Orwell, George. (1945) ‘The Sporting Spirit.’ http://www.orwell.ru/library/articles/spirit/english/e_spirit (accessed 18 June 2015)

Right To Play International (2015) http://www.righttoplay.com/Pages/default.aspx (accessed 18 August 2015)

Sportanddev.org (2009) Sport and Peacebuilding. http://assets.sportanddev.org/downloads/090611_sport_and_peacebuilding_profile_for_print.pdf (accessed 27 June 2015)

‘Sports, Military and Peace-making: A New Dimension’ (2012). Hilal: The Pakistan Armed Forces Magazine, http://hilal.gov.pk/index.php/grids-preview/2014-09-09-14-38-33/item/838-sports-military-and-peace-making-a-new-dimension (accessed 13 June 2015)

UEFA. (2015) ‘Madrid's Kroos, Ronaldo hand UEFA cheque to ICRC.’

http://www.uefa.com/uefachampionsleague/news/newsid=2218310.html (accessed 15 August 2015)

United Nations Educational Scientific and Cultural Organisation. (1978) ‘International Charter of Physical Education and Sport.’ http://portal.unesco.org/en/ev.php-URL_ID=13150&URL_DO=DO_TOPIC&URL_SECTION=201.html (accessed 7 June 2015)

United Nations. (2005) Millennium Development Goals http://www.un.org/millenniumgoals/ (accessed 26 June 2015)

United Nations. (2015) ‘Transforming Our World: The 2030 Agenda for Sustainable Development.’ http://www.un.org/pga/wp-content/uploads/sites/3/2015/08/120815_outcome-document-of-Summit-for-adoption-of-the-post-2015-development-agenda.pdf (accessed 15 August 2015)

United Nations. (2015) List of Goodwill Ambassadors from the sporting world. http://www.un.org/wcm/content/site/sport/home/unplayers/goodwillambassadors (accessed 25 August 2015)

US Anti-Doping Agency. (2012) ‘Press release: Lance Armstrong.’ http://www.usada.org/lance-armstrong-receives-lifetime-ban-and-disqualification-of-competitive-results-for-doping-violations-stemming-from-his-involvement-in-the-united-states-postal-service-pro-cycling-team-doping-conspi/ (accessed 7 August 2015)

US Department of State. (2011) ‘Afghanistan's Ghazi Stadium Enjoys Renaissance.’ http://blogs.state.gov/stories/2011/12/28/afghanistans-ghazi-stadium-enjoys-renaissance

(accessed 20 August 2015)

Politics of Cyberspace: Balancing Virtual Attacks and Real-World Responses

Lauren Eliot

Abstract Cyber security is a new arena for the international system, one increasing in importance due to the world’s dependence on digital technology. Governments, and companies, need to find means of protecting themselves in cyberspace without limiting technology’s potential for the creation and spread of innovation and public good. This dissertation seeks to understand how the lack of rules in cyberspace affects the development of such means. The investigation has two main focuses: response and prevention. The analysis will be based on actions at a national government level, while considering institutional efforts and events in the private sector. A conclusion is reached that specific norms and regulations for dealing with cyber security threats are not possible in the near future. Governments have an incentive to keep policy ambiguous, and allow for more deterrence and response options according to national interest at the time of attacks.

Introduction This paper investigates the ongoing efforts of major cyber powers to develop a framework for dealing with cyberspace. It begins with a technical explanation of ‘cyberattacks’ to assist in understanding the complexity of cyber security. An analysis of the issues that make developing norms around cyber security complex follows. The subsequent chapters are organized according to options for response and prevention of cyberattacks. Response concerns actions taken on an ad-hoc basis to deal with incidents, in the absence of a useful cyber institution. Prevention concerns government efforts to create a framework to deal with or stop future cyberattacks, not in relation to specific attacks. The response chapter considers cases when China or the US has openly blamed the opposing government, and how the accused has reacted. Next, are cases when the victimized state responded with more than blame, and how this may affect any framework that is likely to be developed. Reflecting on the China-US relationship will then set the stage for understanding and analyzing material in the chapter on prevention. Prevention will first consider traditional diplomatic means of deterrence, not including military or cyberspace methods. Then methods and complications for using military deterrence in the real-world or cyberspace are investigated. Other areas of policy efforts for prevention are the creation of cyber borders. Finally, drawbacks or backlash that governments and businesses need to worry about for any current or developing policy are considered. The dissertation aims to illuminate the development process of norms around cyberspace and determine how this will affect aspects of the international system. In considering options for response, the following questions are considered: At what point does a state attribute a cyberattack to another state? What options does a state have to respond? In seeking methods of prevention, it will consider the question: does multilateral or bilateral cooperation among adversaries have a key role to play, or do governments have an incentive to slip into polarized state groups? The hypothesis is international norms regarding cyber security will be determined by levels of severity of an attack. Cloak and dagger will be the norm for cyberattacks for all incidents excluding those in which the attacker has crossed a line and wreaked too much damage. This line will blur according to current government concerns and objectives. Digital technology is ubiquitous in everyday life. This circumstance is relevant when analyzing individuals, states, and the international system. This new realm has no physical boundaries, and while the public and private sector may create digital walls to protect themselves within this space, such walls can be attacked from anywhere, by anyone with a data connection (Betz and Stevens 2011:10). Cyberspace provides endless opportunities to threaten, attack, and commit other crimes. When governments use cyberspace to manage their countries, attacks can also constitute breaches of sovereignty and acts of war, and thus have consequences on a global scale. The same can be argued for some attacks on businesses, due to an economy’s dependence on the prosperity of the private sector. Cyber security has risen to the forefront of world issues in recent years, as hacking incidents are affecting individuals more broadly. The US Director of National Intelligence (DNI), James Clapper, dubbed cyber-related threats the top strategic threat to the US in 2013, 2014, and 2015. This is the first time terrorism has not been at the top of the list since the 9/11 attacks (US Department of Defense 2015:9). Increasing incidents of data theft and service disruption illustrate how widespread cyberattacks have become. President Barack Obama’s administration blamed North Korea for the Sony hacks in 2014, and implemented new

sanctions on the country in addition to conducting cyberattacks on North Korean networks (Harris 2015). Cyberattacks have the potential to cause large-scale damage due to the world’s dependence on the web for everything from data storage and communication, to the operation of critical infrastructure. The finance sector in particular has felt the repercussions of dependence on technology. The amount of intellectual property stolen from the US annually is greater than the Library of Congress (Barnes and Gorman 2011). Clearly, the problem is pervasive, and governments cannot afford to be complacent. The International Telecommunications Union (ITU) faces inflexible obstacles from some of those same states. Members like Russia, China, and the US cannot reach agreement on which groups deserve a voice in the debate on how to govern cyberspace. Other institutions like the Wassenaar Arrangement may contain logic that can be applied to cyberspace. Yet stretching the arrangement to include this new issue raises concerns about the securitization of cyberspace. A major issue for any kind of cyber regime, preexisting or new, would be agreeing on criteria for judging breaches of sovereignty in the nonphysical world, or whether actors want sovereignty and borders to be a part of the debate. The international community does not currently have an effective body for responding to cyberattacks. There are no clear international norms to judge behavior in cyberspace. Both state and non-state groups differ greatly in how they respond to current cyber threats. This investigation focuses on the China-US relationship. Both states have different attitudes towards governance and development that are arguably indicative of the dynamics between many of the major parties to the cyber debate. New ideas are needed to deal with this world of both possibility and danger, without detracting from evolving technology’s potential for the creation and spread of innovation and public good. Cyber has moved to the forefront of the China-US bilateral relationship. Russia and Iran are also significant actors in the issue of cyber security. It should be noted that Russia and Iran also have extensive cyber capabilities. The DoD cyber strategy names Russia as having advanced cyber capabilities but unclear aims, and points out Iran and North Korea as states that have shown open hostility towards the US and its interests (US Department of Defense 2015:9). This paper focuses on China due to the cyber-relevant policy it has developed to date, its focus on technology for development, and its interactions with the US. Chinese government agents, and agents with suspected state connections, are involved in an increasing amount of cyber events involving information theft and other attacks. The US has also increased its focus on cyber security, and operates extensively in cyberspace. The economic and political dynamics between the two countries will potentially create global precedents on how global powers govern cyberspace. This dissertation faces certain limitations. The world of cyberspace is new. It is not a policy issue to which scholars and policymakers have given much consideration. Given it is a new concern, there is no foreign policy analysis framework for cyberspace that is obviously applicable. A further limitation to this particular paper is the difficulty in finding a balance between attributable evidence from China and the US. Both countries lack certain degrees of transparency, and protect some information in the interest of national security. Yet the Chinese government’s lack of transparency is far more extreme than that of the US (Freedom House 2013:14-15). The result is an imbalance of perspectives and possible specific cases of cyberattacks from Chinese institutions and businesses compared with those from America.

Technical Background A cyberattack or hack can be achieved through various methods. A victim’s internet router connects communication to and from the local network of computers to the Internet. A firewall prevents undesirable connections. A hacker needs only a computer that is connected to the internet, and may then employ any number of methods to attack the local computer system through the internet (Lye and Wing 2005:71-72). What makes cyber security such an evolutionary field is that physical boundaries do not matter. Hackers often enter a network secretly by exploiting unknown vulnerabilities in a network’s security. Network users cannot always tell when they have visited an infected website. The intricacy of cyberspace allows for the creation of unlimited methods and conditions for attacks (Johnson 2012:164). Cyber security is an evolutionary industry, where vulnerabilities and attack methods are constantly changing. Three cyber security terms this paper uses are cyberattack, cyber espionage, and cyber warfare. Cyberattack is the most general term, also referred to in this paper as a hack. A hack is an action to delete data or interfere with computer-based systems. Many of the cyberattacks between China and the US are for still-undefined purposes (US Foreign Service Cyber Official 2015). Many of the incidents with which this paper’s investigation is concerned involve the theft of data, also considered cyber espionage. Stealing data from a system, normally without a trace, can be compared to traditional espionage between nations. Cyber warfare involves a campaign of computer system attacks and disruptions, based on policy objectives to hurt an adversary. China and the US have not experienced this form of attack, but it remains a major policy concern (US Foreign Service Cyber Official 2015). Cyber warfare has two potential uses; to assist in violent campaigns and to replace violent campaigns. The latter use will be relevant for this paper when considering the implications of deterrence norms in cyberspace. A large portion of the damage from cyberattacks is difficult to quantify because it is essentially virtual, but has further repercussions. What begins as virtual can have impacts to the physical world, such as utilities. Another major issue in the field of cyber policy is attribution. Attribution concerns the ability to determine the source of a cyberattack. When efforts to determine the source of an attack are successful, and they lead to a specific IP address and location, this may simply be a computer through which the hacker has routed their attack. An intruder can manipulate their attack to avoid direct detection (McHugh 2001:27). Attribution efforts normally only provide grounds for accusations, not definitive proof. This gives states and non-state groups the ability to easily deny involvement in an attack. While China has not experienced anything similar to the US NSA leaks, there has been extensive evidence published that details their cyber exploits against numerous entities. An advanced persistent threat (APT) is mainly for stealing secret or sensitive information. The attackers get into a system and stay hidden for as long as they can, and attempt to leave secretly as well (Mukaram 2014a). The Mandiant APT1 report on Unit 61398 was a major report of hacking cases that the computer security company traced back to specific sources in the Pudong New Area of Shanghai. Mandiant states it found evidence to be convinced the Chinese government sponsors groups involved in a range of cyberattacks (Mandiant 2013:2). One of the more significant concerns is that the kind of attacks of which Unit 61398 is suspected are not simply for stealing information, but gaining the ability to control infrastructure. According to employees, in June 2012, Chinese hackers failed in an attempt to hack Digital Bond, a security firm specializing in industrial-control computers. Digital Bond’s

clients include a power plant, water project, and mining company (Sanger, Barboza and Perloth 2013). The report did admit the hacking group may be comprised of non-state actors, but elaborated that it was unlikely. China maintains strict control over the Internet within its borders. The Great Firewall of China is a term that refers to the technology used by the Chinese government to restrict internet access. People in China often use technologies like Virtual Private Networks (VPNs) to work around the firewall, although the government has started to crackdown on these services (Mandiant 2013:51). Considering how tightly the government controls China’s internet, it is improbable that the same government does not know about a hacking group that operates in the aforementioned part of China (Mandiant 2013:59). China denied the allegations. Nor did the US government officially support Mandiant’s findings at the time of publication. Part of what makes cyberspace such a difficult area for governments to deal with is that technology cannot provide a direct link between computer and person. If one government is to confront another, there must be more at stake. This was the case when the US charged five members of the People’s Liberation Army (PLA) for hacking related charges, the most direct response between the countries to date. As government experience in dealing with cyberattacks has evolved, certain policy options have arisen. These are not specific to China and the US, but reveal significant divides in the goals of each state. Norms for handling cyberattacks specifically do not exist, and there are no specific laws that apply to offensives across national borders. Multilateral efforts have been made to modify existing institutions for this purpose. The first is the ITU. Per usual, China and the US are on opposite sides of the debates within the ITU. The second is the Wassenaar Arrangement, of which China is not a member. There are efforts being made to apply this arrangement to hacking technology, the logic of which is applicable to this investigation. Actions have also been taken without the role of an institution. Traditional diplomatic responses, mainly bilateral, have become the most common policy of engagement between China and the US. As the concern for national security rises, so has consideration of possible military response to cyberattacks, through cyberspace or the real-world. Such considerations are a major aspect of deterrence policy. Aspects of deterrence include diplomatic and military options. Lastly, the governance of cyberspace has become a major point of debate in the international community. Applying the logic of physical borders to the digital world is an option under consideration. Borders for cyberspace can involve taking data offline and isolating a network. Other options involve creating borders in cyberspace itself, a major point of contention. Barriers to Efficacy in Policy Complexities, both in the public and private sectors, obstruct progress in the effort to deal with cyberattacks. Two of these issues within the government involve secrecy and perceived threat. Governments keep information classified to maintain advantage and to conceal vulnerabilities. The US government discovered the recent Office of Personnel Management hack in April 2015, but did not tell the public for two months. This was because the affected system had not been entirely cleaned, and officials did not want the hackers to realize they had been discovered. Officials created a fake system to take in the cyberattacks, a ‘honeypot’ (Schleifer 2015). Other circumstances may dictate secrecy on a long-term basis. This is so that attackers do not change their techniques after being caught, which would make detection more difficult during the next hack (US Foreign Service Cyber Official 2015). It is necessary to deal with information gaps because of security concerns, but this also makes it difficult for many to comprehend the damage suffered from cyberattacks.

Various sections of the US government prioritize cyber differently. This may not matter in China, where policy is dictated from the top down, but the US government is extremely partisan. This leads to difficulties establishing an agreed policy. Some argue that the cyber security threat from China is being blown out of proportion to justify more government money going to the cyber industry, and to justify increasing cyber security programs against online liberty (Steadman 2013). Several policy areas compete for consideration with cyber, especially privacy concerns. Cyber security does not have the same voice as other policy concerns at this point. This means that as the US government addresses hacking issues with China, their negotiating position will be weaker. “People see a cyberattack as an intangible action. We can’t put a dollar amount to it, feebleness of policy will persist because of this” (US Foreign Service Cyber Official 2015). As more attacks occur, and are publicized, that should change. The tools that cyber presents to a nation state must be dealt with; states not having a cyber policy will suffer more. President Obama stated:

We know foreign countries and companies swipe our corporate secrets... Now our enemies are also seeking the ability to sabotage our power grid, our financial institutions, our air-traffic control systems. We cannot look back years from now and wonder why we did nothing. (cited in Sanger, Barboza and Perloth 2013)

Leaders in China also view cyber security as a priority. China’s Minister of Public Security said:

As the country enters the Internet age, network security has become a national security issue and social stability issue, important to economic development and a serious day-to-day working issue for citizens. (cited in Jourdan 2015)

China and the US display differences in their concept of the cyber issue. Both talk about security, but exhibit different concerns for infrastructure or social stability. Another barrier is a concern for how cyber policy will affect business. Organizations have minimal incentives for disclosing security breaches (Garg, Husted and Camp 2011:3). This is out of concern for their business reputations. When firms that store client information, or company proprietary information, are breached, it is bad for business. Financial incentives exist to minimize coverage on a cyberattack. After a data breach in 2013 that exposed the credit and debit card details of millions of Target shoppers, Target came to a settlement with Visa in 2015, of USD 67 million. In 2014, Target reported that costs related to the cyberattack had reached USD 148 million, and Target is spending a further USD 100 million to improve network security (Li 2015). Cyber security becomes a more tangible issue when considering economic loss. When asked how important certain digital technologies were in their companies, in a survey of CEOs around the globe, cyber security rated 78 percent. Cyber security is in the top three of digital technologies that CEOs view as most important (PwC 2015:19-21). Despite common unwillingness to reveal why cyber security is important, it clearly rates as a concern. Applying Existing Theory and Policy Efforts Theory

Due to cyber security’s evolutionary nature, traditional international relations frameworks are not adequate for explaining the issue. The ability of a state to instigate and deny involvement in a cyberattack, while still leaving behind a trail of circumstantial evidence, creates situations

that depend heavily on context. Governments have yet to draw a redline. China and the US have used bilateral action to handle their cyber issues to date. When dealing with an evolving technological field, there is a perpetual stream of developments that force an actor to change their strategy. A theory on motivations and disincentives for defection or cooperation in the international system would lend itself to explaining this precarious environment. Credibility is the main difference between threats in the physical world and in cyberspace. Cyberattacks imply that the attacker knows about weaknesses in the system, but there is a lot of uncertainty attached to such an idea. Thus, carrying through with a threat and actually striking is necessary to show credibility (Libicki 2009:79). This issue, along with the lack of any system to deal with cyberattacks, reflects the state of anarchy described in realist theory. Mearsheimer’s view on the role of institutions is relevant because the feasibility of international cooperation will play a major role in the kind of rules that may or may not be established for cyberspace. Realism argues that institutions are based on the self-interest of world powers, and do not have an effect on the behavior of those powers (Mearsheimer 1995:7). The difficulty of formulating any guidelines for cyberspace is greatly dependent on states’ self-interest. This is reflected in the lack of agreement between members of the ITU. It is in the interest of states to keep policy ambiguous. Should any agreement be reached in the ITU, or another institution, it would likely have no control over state behavior. As Mearsheimer would argue, institutions are unlikely to affect international stability (Mearsheimer 1995:7). This is particularly true for matters concerning cyberspace. The prisoners’ dilemma situation in cyber security certainly makes cooperation unlikely. Yet as Martin argues, a formal organization can be the answer to a prisoners’ dilemma situation (Martin 1992:769). This makes sense on the surface. Transactions costs would be relatively low. The weakness is the incentive to defect. Cheating is easy in cyberspace. Gaps in applying realist theory to cyber security arise because of secrecy, attribution, and denial issues. Depictions like the prisoners’ dilemma are not entirely appropriate. The situation between China and the US is like two prisoners being interrogated, but without any handcuffs or cell walls. Constructivism, specifically Wendt’s explanation of sovereignty, also applies to cyber security because of the expanding idea of security today. Wendt says that sovereignty will change ideas on security and power because:

1. States will define security through property rights instead of territory 2. States will respect others’ territorial rights more 3. Sovereignty will depend on other nations’ recognition so that international society

can be relied upon to protect security rather than unilateral means. (Wendt 1992:414-415)

The US has certainly come to focus more on property rights, rather than territory. It is clear through US concern for economic espionage on American businesses that security has expanded to include state interests. China also uses the idea of rights and sovereignty to justify security actions. Wendt’s second impetus for changing ideas on security however, has more gaps. States act like they have respect for territorial rights, but territory is not clear in the field of cyber security. The ease of cheating also means states need not take responsibility for any disrespect. Lastly, state recognition does impact sovereignty; but referring back to Wendt’s second point, the international society cannot be relied upon to force respect for sovereignty. Applying Wendt’s theory to cyber security is complicated partially because of how states can take advantage of the attribution issue. An idea of security based so much on sovereignty is a weak framework for an issue where violations of sovereignty happen often.

Policy Cyber does not fit well into existing frameworks within institutions. Efforts have been made to facilitate cooperation on cyber security in the ITU, but there is a divide between advocates of multi-stakeholder and multilateral strategy. The US supports the Internet Governance Forum, which gives non-state groups the same voice as governments – a multi-stakeholder model. China, along with Russia, supports a multilateral model, with governments alone (The Embassy of the People's Republic of China in New Zealand 2011). Part of the multilateral push, mainly on the part of Russia, was that the ITU’s International Telecommunications Regulations (ITRs) be changed to add the responsibility of regulating the Internet and domain name system to the ITU’s duties (World Conference on International Telecommunications 2012:2). While Russia’s entire plan was not adopted, they managed to add a resolution that emphasized governments’ roles and declared “all governments should have an equal role and responsibility for international Internet governance and for ensuring the stability, security and continuity of the... Internet.” China signed the ITRs, and the US did not (Eichensehr 2014). It is unlikely this was detrimental to the US. According to one US diplomat, there is not a lot of faith right now in international organizations (US Foreign Service Cyber Official 2015). ITU efforts to establish guidelines for cyberspace where the US and China are involved are unlikely to succeed. Neither country is known for compromising for the sake of cooperation through the UN. While China is not part of the Wassenaar Arrangement, the system represents a major policy effort for the US. The arrangement was created for “regional and international security and stability, by promoting transparency and greater responsibility in transfers of conventional arms and dual-use goods and technologies, thus preventing destabilising accumulations” (Wassenaar.org 2015). The Bureau of Industry and Security (BIS) in the US Department of Commerce proposed to apply the Wassenaar Arrangement to cyberattack threats (Kovacs 2015). Much of the work involved in the arrangement is controlling distribution of threatening technology, which can certainly limit the spread of advanced malware. The BIS proposal would involve implementing the addition of intrusion software to the list of regulated technologies (Kovacs 2015). The deal still leaves each member state to decide on the movement of any particular item. “All measures with respect to the Arrangement are taken in accordance with national legislation and policies and are implemented on the basis of national discretion” (Wassenaar.org 2015). There is significant argument against the US incorporating software in the regulated Wassenaar technologies. Some argue it gives governments a way to:

…control public security research, it encourages the sale of exploits to local government while making cross-border collaborative research risky, and it provides a way to prohibit white hats from disseminating attack tools found on compromised computers. (Kovacs 2015)

People are worried that applying Wassenaar to cyber threats will result in the militarization of public security research. The situation for researchers would almost be manipulated to the point where working for government interests is easiest and most profitable. Most importantly, it would be only partially effective since many of the actors in cyberspace have existing capabilities and are not members of Wassenaar. Officially, there is a code of law that applies to cyberspace. Both China and the US agreed that international law and the Charter of the United Nations applies to cyberspace as part of the June 2013, UN Group of Governmental Experts on Developments in the Field of Information and Telecommunications in the Context of International Security consensus

(Eichensehr 2014). Yet nothing has been done to follow the relevant rules. States have not seen fit to refer to the UN for retribution to cyberattacks. The US and China have developed a structure within their government to deal with cyber security. Cyber programs in the US are relatively new. President George W. Bush established a Comprehensive National Cybersecurity Initiative in 2008, after an increase in cyberattacks on federal computers. Then, months after President Obama became president he set up a cyber security coordinator in the executive branch and a Cyber Command (USCYBERCOM). USCYBERCOM was set up at Fort Meade with the NSA, and both have the same manager (Thompson 2011). Aside from structure, two main strategies exist in the US; the White House cyber strategy and the Pentagon’s strategy. Microsoft executive, Scott Charney, said the US strategy for cyberspace treated all attacks or hacks with the same strategy, but he argued there are four different security issue areas with cyberspace that should have their own strategies or policies; cybercrime, corporate cyber espionage, sabotage of national infrastructure online, and military cyber espionage (Hickins 2011). States like the US have shown an unwillingness to draw clear boundaries about which attacks warrant which responses. A few years after Charney’s comments, President Obama released an Executive Order on 1 April 2015. It authorizes the implementation of sanctions on people or groups that the Secretary of the Treasury decrees as at fault for involvement in harmful cyber activities that exacerbate or create a “threat to the national security, foreign policy, economic health, or financial stability” of the US (Daniel 2015). While the sanctions order identifies possible means of response, policy remains ambiguous on the severity necessary to merit sanctions. The White House’s strategy for cyberspace promotes certain norms. Many of the norms in this strategy are clearly contradictory to Chinese policy. They include: upholding freedom of expression, respect for intellectual property rights, cooperation with criminal investigations, and multi-stakeholder governance (The White House 2011:10). These norms will not be internationally accepted. China’s Great Firewall and control of the Internet contradicts freedom of expression, their continuous hacking of private firms contradicts intellectual property rights, China’s denial of indictments against members of the PLA is in clear opposition of cooperation with criminal investigations, and China supports a multilateral governance model rather than multi-stakeholder. The only emerging norm from the White House strategy likely to prevail is cyber security due diligence. This essentially means that states have a responsibility to protect information systems from harm (The White House 2011:10). Indeed, cyber security has recently become a priority for governments and businesses in many countries. In April 2015, the Pentagon released its updated cyber strategy, meant to be more open about US policy and strategy for cyber security issues. Cyber units described as part of the US Department of Defense (DoD) strategy include USCYBERCOM and the Cyber Mission Force (CMF) teams to carry out all DoD cyber missions. As the main concern for the Pentagon’s strategy is defense, a significant portion of the 2015 strategy focused on deterrence as a means of prevention. The details of the Pentagon’s deterrence policy reflected the same ambiguity as that of the White House. China has shown evidence of considering implications of cyberspace on security much earlier than the US. Yet they are not as clear on their policies and structures in place for response and prevention of cyberattacks, even considering US ambiguity. Experts have said that China is developing extensive cyber military capabilities, as are the US and approximately 100 other countries. In China, one cyber department is reportedly comprised of more than 130,000

employees, and cyber militias and patriotic hacker groups also contribute to Chinese state interests (Roggeveen 2014). One offensively-focused unit that has drawn attention is Unit 61398. The unit is likely the 2nd Bureau of the PLA’s General Staff Department’s 3rd Department. Unit 61398 has compromised at least 141 companies in 20 different industries since 2006 (Mandiant 2013:3). Unit 61398 is thought of as a state secret (Sanger, Barboza and Perloth 2013). China’s government does not openly discuss the workings of this unit, and usually denies any direct questions about its operations. Attribution efforts towards China-based hacking would certainly seem stronger if the Chinese government did not treat the unit as a secret. Geng Yansheng, Chinese Defence Ministry spokesman, told Xinhua in 2011, that some sort of cyber unit existed in the government, “cyber blue team”, to protect China from cyberattacks (cited in 4 News 2011). While not reflecting official policy, Unrestricted Warfare, published by two PLA colonels in 1999, reveals insights into how the Chinese government views and uses cyberspace. The work discusses the changing nature of conflict and considers how states like China can match US military power. It states,

[Unrestricted warfare] means that all weapons and technology can be superimposed at will, it means that all the boundaries lying between the two worlds of war and non-war, of military and non-military, will be totally destroyed, and it also means that many of the current principles of combat will be modified, and even that the rules of war may need to be rewritten. (Qiao and Wang 1999)

This idea reflects the theme of asymmetric war in cyberspace. It means military might matters less, and the playing field is more even. State Attribution and Response Accusations

The principal US response to Chinese hacking is to openly assign them attribution. In particular cases the government itself has not blamed China, but reports from the private sector have elicited a reaction from China. This was the case when computer security experts reported their findings on Unit 61398. Kevin Mandia, of Mandiant stated:

Either [the cyberattacks] are coming from inside Unit 61398... or the people who run the most-controlled, most-monitored Internet networks in the world are clueless about thousands of people generating attacks from this one neighborhood. (Sanger, Barboza and Perloth 2013)

The US government did not publicly support the accusation, but there were unofficial government statements that implied support. Congressman Mike Rogers, chairman of House Intelligence Committee, said Mandiant’s report was consistent with the incidents the committee had been seeing for a while. Meanwhile, Chinese embassy officials in Washington denied Chinese government involvement in hacking and said it was illegal (Sanger, Barboza and Perloth 2013). The report may have exposed some of China’s hacking activity, but no guidelines for handling cyberattacks came of it. The OPM hacks illustrate a case of specific attacks that directly targeted government networks. The 2015 OPM hack was the second serious breach of the department that has been blamed on China, in under a year. In March 2014, officials found that hackers, who they later suspected as state-sponsored Chinese agents, had broken into the OPM system that contains

sensitive data related to federal clearances. Sensitive data can mean anything from finances to family details. The US accused the Chinese government of orchestrating the OPM hack in December 2014 (Denyer 2015). In 2015, OPM networks were breached again, with the addition of more federal government agencies in the executive branch. US investigators said they believed the 2015 attack to have been perpetrated by China (Liptak, Schleifer and Sciutto 2015). Yet the Obama administration avoided blaming the Chinese government for the OPM hack. DNI Clapper implied he was impressed with the Chinese for the hack, but has avoided connecting China to the hack since (Mazzetti and Levin 2015). Zhu Haiquan, a Chinese Embassy official in Washington DC, opposed claims that the Chinese government was responsible for the recent OPM breach. Zhu said:

Cyberattacks conducted across countries are hard to track, and therefore the source of the attacks is difficult to identify. Jumping to conclusions and making [a] hypothetical accusation is not responsible and counterproductive. (cited in Liptak, Schleifer and Sciutto 2015)

This is a clear example of how attribution makes cyber security a complicated issue. It provides governments with an incentive to conduct operations, and easily deny involvement if caught. In a Xinhua article responding to the US accusing China, it was stated, “the allegation, which is still wanting to be supported by proof, is obviously another case of Washington’s habitual slander against Beijing on cyber security” (Tian 2015). Not only does attribution become an issue, but secrecy does as well when there is no acknowledgement of attack. Norms of espionage between governments have also become a theme for dealing with cyberattacks. Alternate Courses of Action Aside from assigning attribution, the US government has used legal and economic responses. The economic responses, such as sanctions, have not been used against China. Sanctions against China’s economy are unlikely to occur in the near future due the importance of China’s economic relationship with the US. Thus, sanctions are likely more relevant for nations without the same level of economic power. There are unintended consequences that can result from responses, within a bilateral scope, or on a much larger scale. As such, very little action other than public blaming has been taken (US Foreign Service Cyber Official 2015). The legal course taken against China refers to the indictment of five PLA members. From about 2006 to 2014, the members of the PLA planned hacks into the computer systems of commercial groups in the US in order to: maintain access to the computer systems and steal data for the commercial groups’ competitors, “including state-owned enterprises”. The state enterprises were referred to as “SOEs” throughout the indictment, and not identified (United States of America v. Wang Dong, Sun Kailiang, Wen Xinyu, Huang Zhenyu, Gu Chunhui [2015]:1-2). The US Department of Justice (DoJ) referred to the five accused as “Known State Actors”, and specifically names them as officers in Unit 61398 of the Third Department of the PLA. The defendants were charged with crimes of economic espionage and related crimes; it is the first case ever of cyber espionage charges against a state actor (US Department of Justice 2015). This was essentially the first official corroboration by the US government of the report on Unit 61398. The espionage charges represent the most active stance to date taken by the US government against Chinese hacking. Something changed to make action worth it, despite risks in other policy areas. First, repeated hacks by suspected Chinese actors increased in priority. Second, evidence was obtained to determine the specific identities of the people involved in the case. Third, the five individuals were hacking US

companies for economic gain. The indictment shows the first time industry was willing to talk about the cost of cyber security issues. Evidence from the affected companies was part of the case. This signals that cyberattacks with more potential for financial harm may merit harsher responses from the targeted state. Chinese reaction to the indictments consisted of two main complaints. The first, as usual, was a call for evidence. A Xinhua article referred to the five indictments as fabricated charges, and said the action “eroded strategic trust between China and the United States, one of the world’s most important bilateral relationships” (Huang 2014). The US was not willing to let the issue of attribution hinder the legal action in this case. John Carlin, assistant attorney general for national security, responded to China’s rejection of the PLA members’ indictment and call for evidence with:

We are confident that we have the evidence to back up these specific accusations in a court of law. Read the indictment. It is particular. For the first time, we have exposed the real faces and names behind the keyboards in Shanghai used to steal from American businesses. This is not conduct that responsible nations within the global economic community should tolerate. (cited in Dews 2014)

The second complaint was about the harm done to trust in the US-China relationship. Shi Yinghong, director of US Studies at Renmin University stated:

Beijing and Washington had reached a certain consensus that both sides don’t point the finger at each other regarding cyber-hacking... Now this hard-won dialogue channel in this strategic area has been damaged. (Shi and Riley 2014)

Shi is referring to China stopping its involvement in the cyber security working group, set up in 2013, between the US and China (Shi and Riley 2014). China is a big market for management consultancies like McKinsey, BCG, and others. Sources close to the operations of some of these major US consulting companies said they have retained some Chinese state companies as clients. “China is unlikely to completely banish US technology companies from the country given how reliant it is on western software” (Anderlini 2014). The US government had to accept some strategic drawbacks. If the secrecy concerns were overridden, it must have been judged to be worth moving to a more active course. “We’ve already poked and provoked China, and it hasn’t gotten us much” (US Foreign Service Cyber Official 2015). Reflection

It is clear the US and China disagree about what constitutes acceptable cyber espionage. The US believes that unspoken acceptance of political and diplomatic espionage between governments is the norm, and economic espionage on the private sector crosses the line. The Chinese hacked the private sector and passed the stolen data to Chinese companies. More specifically, the data was passed to state-owned enterprises. This raises an important point. The US has a mostly free market system. China has a highly centralized, state-controlled system. This can explain the Chinese reaction to the change in US behavior for an economic espionage case. “The unfounded charge against Chinese officers amounts to the same hypocrisy as a bandit calling for justice” (An 2014). In this situation, the US would argue that a different kind of banditry applies. Sun Jianguo, deputy chief of General Staff of the PLA, “It is ridiculous for the US side to say that cyber espionage on political and military intelligence is common practice while the theft of commercial secrets is illegal” (cited in Bi 2014a). Sun

argued that US action was hypocritical, and that it broke international relations norms (Bi 2014a). The US viewed the particular case of cyber economic espionage as more damaging than the tacitly-accepted political espionage. The DoD’s cyber strategy specifically mentions, “China steals intellectual property (IP) from global businesses to benefit Chinese companies and undercut US competitiveness” and stability (US Department of Defense 2015:9-12). This has started to push cyber higher on the priority list in the US. Especially since economic espionage reportedly causes over USD 300 billion in loss (Dews 2014). Zachary Goldman, former senior official in the US:

The US government has worked hard to cultivate a norm against commercially-motivated cyber espionage... If this hack was motivated by reasons of state, we still might find it objectionable, and might indeed retaliate in ways that are outside the public eye. But we might not want to vocally argue that this kind of espionage should never take place. (Harris 2015)

The US clearly intends to refrain from condemning espionage between governments, as it is beneficial to the US itself. As for espionage in the commercial sector, there is a clear incentive to protect American business. Status of China-US Relationship Addressing the cyberattacks from China is a major policy issue for the US. As previously discussed, China has been the suspect of multiple high-profile and large-scale breaches in US cyber security. China is also the suspect in multiple commercial hacking cases. China’s hacks target public and private entities, and there is strong evidence to suggest that they are sponsored by the government. Akamai’s State of the Internet report from the fourth quarter of 2012, said 41 percent of the world’s cyberattacks originate from China. The same report said 10 percent originated from the US (Steadman 2013). China also reported cyberattacks from the US. Officials have said, they get continuously attacked by the “US hacker empire” (Anderlini 2014). Chinese government, universities, and companies have been victims of major cyberattacks based in the US (An 2014). The Chinese government names the US as its greatest cyber attacker. Officials have asked the US to stop, but have received no apparent statement on its practices (Shi and Riley 2014). Much of the US government’s cyber activity has been exposed. The 2013 NSA-Snowden leaks revealed the NSA’s collection of the metadata of people’s phone and communication activities, as well as other spying activities (Freedom House 2013:797-798). Chinese officials are able to use this knowledge when the US confronts them on their current cyber activity. Preventing Attacks Nonmilitary Deterrence In the absence of concrete frameworks in international institutions, governments must take a stance on how they are willing to respond to cyberattacks in order to disincentivize potential hackers. The only public types of responses carried out so far have been traditional means of diplomacy. To respond to cyber security threats, the US has shown a willingness to employ demarches and legal action. Yet there are multiple options still available. Deterring attacks with economic threats such as sanctions, as mentioned in White House policy, is not likely a viable option in the US-China relationship. Is it worth confronting China, the world’s second

largest economy, over hacking (Sanger, Barboza and Perloth 2013)? This is extremely unlikely unless an attack occurs that is more financially damaging than the operation that ended in five indictments. It is the same when considering the US debt’s role in prevention options. One option involves controlling the movement of individual citizens. Hackers are often in different countries or unidentifiable. The perpetrators of other varieties of crime are not often as difficult to find. The US and China do not have an extradition treaty (Mazzetti and Levin 2015). The US government could announce it will be less cooperative when sending suspects in Chinese investigations back to China, or allowing Chinese nationals who have committed offenses in the US to return home. The Chinese government would be able to do the same however, and such policies may prove more harmful than helpful. There are many other policy matters through which a government may withhold support or cooperation. Such matters often take place in private. One of the largest deterrents can be confronting governments behind the scenes about the attack and noting the potential damage to the overall bilateral relationship, including in unrelated areas such as visas, trade, and more. Applying deterrent options to traditional international relations subjects is very new. There are not a lot of policy or cyber experts telling the government how to do it (US Foreign Service Cyber Official 2015). As with any action, all of the diplomatic options for creating a deterrence policy have negative implications. Traditional diplomatic means are still the default option. Military Deterrence A military-related deterrence policy was clearly stated in the Pentagon’s 2015 cyber strategy. The DoD believes that deterrence of cyberattacks will not be effective through the voicing of cyber policies alone. Among other important policy elements, the DoD names; defensive stance, response procedures, and cooperation between government agencies as being important in having an effective deterrence strategy (US Department of Defense 2015:10). Regarding its policy on response options, in multiple forums since 2011 the US has expressed its willingness to answer a cyberattack on its interests through defense capabilities.

The United States will continue to respond to cyberattacks against US interests at a time, in a manner, and in a place of our choosing, using appropriate instruments of US power and in accordance with applicable law. (US Department of Defense 2015:11)

It is unclear which instruments qualify as appropriate, or how severe an attack’s damage must be to warrant a particular kind of response. The DoD’s policy essentially says that there is a redline, but refrains from describing where the line is. A list of approved weapons in the event of an actual response has existed since the DoD’s 2011 strategy was published. Military officials said in 2011, that the Pentagon had a list of cyberspace capabilities they can use in the event of cyber warfare. The techniques or cyber weapons have already been in use, and approved by agencies like the CIA (Nakashima 2011a). These cyber capabilities are part of a bigger list of approved weapons the Pentagon can use against enemies. One senior, anonymous, military official said:

So whether it’s a tank, an M-16 or a computer virus, it’s going to follow the same rules so that we can understand how to employ it, when you can use it, when you can’t, what you can and can’t use. (cited in Nakashima 2011a)

Still, little is known about the guidelines. On the use of cyber weapons specifically, it was revealed that the use would still be dictated by how proportional the response is to the threat, and must avoid civilian casualties or collateral damage (Nakashima 2011a). While deterrence is clearly an important focus, no explanation has been given for what qualifies as a serious violation of sovereignty or act of war.

At the end of the day, the answer to whether a particular attack is an act of war comes down to this: Is it in your interest to declare it so? (Libicki 2009:180)

This blending of virtual and real-world security concerns warps the traditional concept of what qualifies as war. Cyber actions stretch from espionage to calculated kinetic damage. Examples of cyberattacks causing physical damage to systems include the Stuxnet virus attack at the Iranian nuclear facility and a more recent cyberattack on a German steel mill (Lee, Assante and Conway 2014:1). To what extent do cyber security issues fit in a war discourse? The military is seven to eight years ahead of nonmilitary groups in the area of cyber security (Information Security Analyst 2015), and has been largely driving cyber security discourse. Aside from arguments of profit-driven motives, this points to the expanded idea of security. Some have argued that the DoD’s deterrence approach is overly aggressive. Igniting a cyber war has certainly been a concern.

US Cyber Command has been on a rather tight leash with the Obama administration. You can’t have them getting into asymmetric warfare. It would actually create a more unstable world if they cyber attacked every perceived threat. (US Foreign Service Cyber Official 2015)

China has strong capabilities for establishing a clear deterrence policy as well, although it has not been their focus. Boxun, a news site run by Chinese exiles, experienced a cyberattack in 2012, that also affected the Colorado hosting company name.com. An email was sent along with the attack that demanded Boxun’s shutdown, but name.com assisted Boxun in switching servers instead (Freedom House 2013:212). Also, the Munk School of Global Affairs of the University of Toronto, published a report in which it discussed its findings on a cyber weapon that it dubs China’s Great Cannon. The Great Cannon hijacks internet traffic from individual IP addresses to use in a cyberattack. This capability was shown in March 2015, when GreatFire.org experienced multiple cyberattacks on their servers and webpages meant for circumventing Chinese censorship (Marczak et al. 2015). Guidelines have yet to be revealed, if ever. It is clear that should the need arise to follow through on a deterrence threat, there is potential for it to proliferate into a bigger conflict. Borders Creating borders in cyberspace is a prevention option. One form of border creation would involve moving sensitive data offline. Many who view the cyber issue as overstated, have argued for this option. Chris Palmer, technology director with the Electronic Frontier Foundation advocacy group, argues the cyber threat is being overstated, so people can make money from it (Arsenault 2011). The cyber warfare market is small by federal standards – the USD 9 billion spent in 2011 was only about one day’s worth of federal spending.

It’s true that the lion’s share of funding goes to the Department of Defense, which overseas additional billions spent on network attack and exploitation, but in an organization that annually passes out $400 billion in contracts, it still doesn’t amount to much. Market research firm Input projects federal cyber security funding will increase 9% annually through 2015, but the government is entering a period of severe fiscal austerity and there are many other claimants for government dollars. With every major contractor in the business straining to get a piece of this relatively small pie, the prospects for making a killing are not high. (Thompson 2011)

The idea that the cyber threat is being exaggerated for financial gain may be true, but it is unlikely to be profitable. When asked in an interview about securitizing the internet, Peter

Singer, author of multiple cyber security works, said the spirit of trust on the internet is threatened. He continued:

We can see attacks on this trust from the massive wave of cyber crime, to the ill-effects of attempts by the NSA and our allies' intelligence agencies to conduct mass online monitoring in the pursuit of small numbers of terrorists, to the creation of 'Great Firewalls' in China and the 82,000 websites blacklisted by Russia that threaten to balkanize the internet. A deep concern I have in the year ahead is the attempts by authoritarian regimes to shift the underlying governance model of the internet to one that is state controlled. (Roggeveen 2014)

China has done the most work for the borders option, with their “cybersovereignty” focus. Premier Li Keqiang, referring to the weakening of China’s economic growth, said China needs to focus more on “innovation-driven development”. As part of China’s new innovation focus, Li revealed the Internet Plus plan in March. The plan promotes business integration with the internet.

We will develop the “Internet Plus” action plan to integrate the mobile Internet, cloud computing, big data, and the Internet of Things with modern manufacturing, to encourage the healthy development of e-commerce, industrial networks, and Internet banking, and to guide Internet-based companies to increase their presence in the international market. (cited in Bandurski 2015b)

While it may sound like a plan contradictory to the borders option, the plan has also been used to strengthen China’s Great Firewall. In May 2015, the People’s Liberation Army Daily, which serves as a platform for state ideas, published an editorial that essentially said China is at war on the internet. The same paper published an article that complained of how Western countries had added online issues to their defense and military strategies, in which they stated: “Only by steadily engaging, standing at the front and making strong counter-attacks can our army preserve ‘online sovereignty’ and build an ‘online Great Wall’” (cited in Bandurski 2015c)! In June 2015, Chinese Internet police set up units on social networking sites in 50 cities to stop cyber crimes. It was described by analysts as significant progress towards advancing the rule of law online (Yan 2015). China’s economy will not be the only area hurt by its isolation. Foreign Policy’s ongoing survey of Chinese international students in the US shows that 44 percent believe internet censorship has affected their lives “a lot”. “In effect, China’s government is revoking the international digital passports that the Internet naturally confers on its participants” (Wertime 2015). China’s extreme regulation of information on the internet effectively prevents a generation of people growing up in the digital age from learning how to deal with its realities. “The country’s youth will also find themselves unable to act as digital ambassadors to explain the Chinese perspective to the rest of the world” (Wertime 2015). The Chinese government is not helping its citizens by building more walls. Consider that policies of isolation in the past have generally hampered growth and progress. Borders in cyberspace may result in more damage than protection. Government Concerns In addition to the drawbacks and difficulties mentioned for deterrence and borders options, governments face complications concerning denial by other states and non-state actors. It is already clear that attribution presents a problem, but some cases of denial go beyond simply taking advantage of attribution. Events have shown governments that denial, no matter the evidence or international solidarity, is effective in keeping the status quo and hindering any

effective dialogue. Examples include Russia’s denying it had any troops in Ukraine, and China’s objection to indictments despite hard evidence (Bowe 2015).

Autocratic governments appear to have come to the conclusion that there is simply no reason to admit any wrongdoing if they don’t have to. Basically, if opposing parties are not going to take concrete steps to force Beijing or Moscow to force the dialogue, why should they comply? The current state of things in both cases is what works best for the relevant regimes, so they view it as in their strategic interests to maintain the status quo of doing what they want and lying through their teeth that they’re doing otherwise, because they believe that there is nothing that anyone else can - or, more to the point, will - do about it. (Bowe 2015)

Considering such an issue, it is unlikely that prevention options entailing international cooperation will be fruitful. Non-state actors also make any discussion of retribution difficult. China may be known for state-sponsored cyberattacks, but there are still numerous non-state groups within its borders. Non-state cyber groups are a very significant problem, especially because China uses them very effectively (US Foreign Service Cyber Official 2015). Are governments likely to cooperate with any response to a cyberattack, if the attack happened to be in their interest? China is not likely to do so, and neither is the US. Commercial Concerns

Considering the role that cyberattacks in the private sector have played in government behavior, it is important to consider how businesses are impacted by government action. The known number of cyber security breaches in 2013 was 42.8 million, a forty-eight percent increase (PwC 2015:21). Cyberattacks are becoming a bigger problem for companies. Foreign businesses in China and the US were affected by government responses to each other for hacking incidents, including after the five PLA indictment. The Chinese company Huawei was pushed out of the US market, while the use of IBM servers in China was reconsidered (Huang 2014). Mandiant’s APT1 report does not name companies who want to remain anonymous. However, the New York Times articles on the report connects one case in 2009 to Coca-Cola. The attack came at the same time as the company’s failed negotiations to buy the China Huiyuan Juice Group for USD 2.4 billion. Chinese hackers stole and sent Coca-Cola files through a web of computers to Shanghai every week. Joe Stewart, a Dell SecureWorks researcher, when investigating the hack into the RSA computer security company in 2011, found a tool that hackers had used to hide their whereabouts. After reverse-engineering the tool he saw that most of the stolen RSA data was sent through the same IP addresses that Mandiant later found in Shanghai, Unit 61398’s neighborhood (Sanger, Barboza and Perloth 2013). The framework of controls in the digital world used by governments likely cannot apply to businesses. More research is needed to understand non-technical options that businesses have for deterring cyberattacks. Conclusion Cyber security norms regarding protocol for cyberattacks will form around national interest at the time of the response. While conflict in the real-world and virtual world are blending together, it is unlikely that the kind of cyberattacks occurring so far will lead to a traditional military conflict. A norm may form around treating cyberspace as another border to defend. Norms regarding the means of defending such a space will not be established. Ideas for how to govern and police cyberspace will polarize the international community. This may occur

along multi-stakeholder and multilateral lines, or perhaps around beliefs on political and economic espionage norms. There are few disincentives to committing a cyberattack, if the hacker is located in a non-allied state. Events so far have shown any technologically-capable Chinese or American hacker that there will likely be no backlash for their cyber actions on the opposing state. This applies until current political climate leads to it being deemed in the national interest to make an example for future deterrence, even if symbolic. As for laws of conflict, or chances of success for any institutional effort to address cyber security concerns, these are unlikely to be effective. The only countries that would agree are those with limited offensive capabilities, to further their national interest. It is in the interest of states to refrain from creating an explicit framework for offenses in cyberspace. If governments were to explain where the line was for an attack to merit a specific response, attackers would have an incentive to go up to the line and not beyond. The best option for prevention, for prospective targets, is not to formulate a specific unclassified plan. Response options should mirror this, and not follow a pattern, but be decided according to interests on a case-by-case basis.

Bibliography

4 News, (2011). China Admits Cyber Warfare Unit. [online] Available at:

http://www.channel4.com/news/china-admits-cyber-warfare-unit [Accessed 19 Aug. 2015].

An, (2014). China Voice: Spy charges expose U.S. cyber hegemony mentality. Xinhua. [online] Available at: http://news.xinhuanet.com/english/china/2014-05/21/c_133351011.htm [Accessed 31 Aug. 2015].

Anderlini, J. (2014). China clamps down on US consulting groups. The Financial Times. [online] Available at: http://www.ft.com/cms/s/0/310d29ea-e263-11e3-89fd-00144feabdc0.html?ftcamp=published_links%2Frss%2Fhome_us%2Ffeed%2F%2Fproduct#axzz3inhRykDu [Accessed 14 Aug. 2015].

Andress, J., Winterfeld, S. and Rogers, R. (2011). Cyber warfare. Amsterdam: Elsevier/Syngress.Arsenault, C. (2011). China and the US: Sizing up for cyber war?. Al Jazeera. [online] Available at: http://www.aljazeera.com/indepth/features/2011/06/201168204035985818.html [Accessed 19 Aug. 2015].

Ballasy, N. (2015). Clapper salutes the Chinese for OPM cyber attack. [video] Available at: https://www.youtube.com/watch?v=rfUCGNGiaXM [Accessed 17 Aug. 2015].

Bandurski, D. (2015a). China’s media under Mr. Positive. China Media Project. [online] Available at: http://cmp.hku.hk/2015/05/06/38691/ [Accessed 30 Aug. 2015].

Bandurski, D. (2015b). Control and innovate. China Media Project. [online] Available at: http://cmp.hku.hk/2015/05/20/38731/ [Accessed 30 Aug. 2015].

Bandurski, D. (2015c). What’s up with the PLA?. China Media Project. [online] Available at: http://cmp.hku.hk/2015/05/21/38822/ [Accessed 30 Aug. 2015].

Barnes, J. and Gorman, S. (2011). Cyberwar Plan Has New Focus on Deterrence. The Wall Street Journal. [online] Available at: http://www.wsj.com/articles/SB10001424052702304521304576446191468181966 [Accessed 17 Aug. 2015].

BBC News, (2008). US warned of China 'cyber-spying'. [online] Available at: http://news.bbc.co.uk/1/hi/world/asia-pacific/7740483.stm [Accessed 16 Aug. 2015].

Betz, D. and Stevens, T. (2011). Cyberspace and the state. London, U.K.: IISS, The International Institute for Strategic Studies.

Bi, M. (2014a). Chinese general labels U.S. No.1 cyber thief. Xinhua. [online] Available at: http://news.xinhuanet.com/english/indepth/2014-05/28/c_133368644.htm [Accessed 31 Aug. 2015].

Bi, M. (2014b). Report blasts "unscrupulous" U.S. surveillance in China. Xinhua. [online] Available at: http://news.xinhuanet.com/english/indepth/2014-05/26/c_133362659.htm [Accessed 31 Aug. 2015].

Bowe, A. (2015). Cybersecurity: We Need a Chinese Snowden. The Diplomat. [online] Available at: http://thediplomat.com/2015/07/cybersecurity-we-need-a-chinese-snowden/ [Accessed 16 Aug. 2015].

CNNMoney, (2015). Hackers are learning to spy on you on YouTube. [video] Available at: https://youtu.be/Ov0S-JjDeJk [Accessed 13 Aug. 2015].

Curry, D. (2015). Could a cyber attack kill? IT executives believe so Read more: http://www.itproportal.com/2015/07/22/future-of-cyber-attacks/#ixzz3kIist7xk. IT Pro Portal. [online] Available at: http://www.itproportal.com/2015/07/22/future-of-cyber-attacks/ [Accessed 30 Aug. 2015].

Daniel, M. (2015). Our Latest Tool to Combat Cyber Attacks: What You Need to Know. [Blog] White House Blog. Available at: https://www.whitehouse.gov/blog/2015/04/01/our-latest-tool-combat-cyber-attacks-what-you-need-know [Accessed 30 Aug. 2015].

Denyer, S. (2015). China calls U.S. hacking accusations ‘irresponsible and unscientific’. The Washington Post. [online] Available at: https://www.washingtonpost.com/world/asia_pacific/china-calls-us-hacking-accusations-irresponsible-and-unscientific/2015/06/05/7989cad3-583f-417e-a0b7-34be46eb16ff_story.html [Accessed 13 Aug. 2015].

Dews, F. (2014). Unit 61398 Indictment Exposes Real Faces and Names Behind Shanghai Keyboards Used To Steal from U.S. Businesses. Brookings Now. [online] Available at: http://www.brookings.edu/blogs/brookings-now/posts/2014/05/unit-61398-indictment-exposes-real-faces-names-behind-shanghai-keyboards [Accessed 30 Aug. 2015].

Eichensehr, K. (2014). The US Needs a New International Strategy for Cyberspace. Just Security. [online] Available at: https://www.justsecurity.org/17729/time-u-s-international-strategy-cyberspace/ [Accessed 30 Aug. 2015].

Freedom House, (2013). Freedom on the Net 2013. [online] New York: Freedom House. Available at: https://freedomhouse.org/sites/default/files/resources/FOTN%202013_Full%20Report_0.pdf [Accessed 30 Aug. 2015].

Garg, V., Husted, N. and Camp, J. (2011). The Smuggling Theory Approach to Organized Digital Crime. IEEE. [online] Available at: http://www.cs.indiana.edu/~nhusted/docs/garg2011smuggling.pdf [Accessed 25 Jul. 2015].

Hagestad, W. (2012). 21st century Chinese cyberwarfare. Ely, Cambridgeshire, United Kingdom: IT Governance Publishing.

Harris, S. (2015). Team Obama Knows China Is Behind the OPM Hack. Why Won’t They Say So?. The Daily Beast. [online] Available at: http://www.thedailybeast.com/articles/2015/07/20/team-obama-knows-china-is-behind-the-opm-hack-why-won-t-they-say-so.html [Accessed 16 Aug. 2015].

Hickins, M. (2011). White House Advisor: Use of Term Cyberwar “Terrible”. [Blog] Wall Street Journal Digits. Available at: http://blogs.wsj.com/digits/2011/02/15/white-house-advisor-use-of-term-cyberwar-terrible/ [Accessed 19 Aug. 2015].

Huang, Y. (2014). Commentary: U.S. needs to bring sincerity to cyber security talks with China. Xinhua. [online] Available at: http://news.xinhuanet.com/english/indepth/2014-07/09/c_133470336.htm [Accessed 31 Aug. 2015].

Industry and Security Bureau, (2015). Wassenaar Arrangement 2013 Plenary Agreements Implementation: Intrusion and Surveillance Items. Federal Register. [online] Available at: https://www.federalregister.gov/articles/2015/05/20/2015-11642/wassenaar-arrangement-2013-plenary-agreements-implementation-intrusion-and-surveillance-items [Accessed 30 Aug. 2015].

Information Security Analyst. Interviewed by: Eliot, L. (4th September 2015).

Isidore, C. (2015). Traders made millions on stocks after hacking press releases. CNN. [online] Available at: http://money.cnn.com/2015/08/11/investing/hacked-stock-press-release-indictment/ [Accessed 13 Aug. 2015].

Isikoff, M. (2013). Chinese hacked Obama, McCain campaigns, took internal documents, officials say. NBC News. [online] Available at: http://investigations.nbcnews.com/_news/2013/06/06/18807056-chinese-hacked-obama-mccain-campaigns-took-internal-documents-officials-say [Accessed 27 Jul. 2015].

Jacobs, A. (2015). China Further Tightens Grip on the Internet. The New York Times. [online] Available at: http://www.nytimes.com/2015/01/30/world/asia/china-clamps-down-still-harder-on-internet-access.html [Accessed 16 Aug. 2015].

Johnson, M. (2012). Demystifying communications risk. Farnham, Surrey: Gower.Johnson, M. (2013). Cyber Crime, Security and Digital Intelligence. Ashgate Publishing Ltd.

Jourdan, A. (2015). China to put security teams in major Internet firms, websites. Reuters. [online] Available at: http://www.reuters.com/article/2015/08/05/us-china-internet-security-idUSKCN0QA0G020150805 [Accessed 30 Aug. 2015].

Kelly, C. (2009). Cyberspies' code a click away. Toronto Star. [online] Available at: http://www.thestar.com/news/gta/2009/03/31/cyberspies_code_a_click_away.html [Accessed 16 Aug. 2015].

Kim, S. (2015). Authorities Foil 5-Year Scheme of Allegedly Stealing Press Releases Ahead of Corporate News. ABC News. [online] Available at: http://abcnews.go.com/Business/authorities-foil-year-scheme-allegedly-stealing-press-releases/story?id=33013400 [Accessed 13 Aug. 2015].

Kovacs, E. (2015). Experts Concerned About Effects of Proposed Wassenaar Cybersecurity Rules. Security Week. [online] Available at: http://www.securityweek.com/experts-concerned-about-effects-proposed-wassenaar-cybersecurity-rules [Accessed 30 Aug. 2015].

Kube, C. and Miklaszewski, J. (2015). Russia hacks Pentagon computers: NBC, citing sources. NBC News. [online] Available at: http://www.cnbc.com/2015/08/06/russia-hacks-pentagon-computers-nbc-citing-sources.html [Accessed 13 Aug. 2015].

LeClaire, J. (2014). Chinese Authorities Hack Apple's China iCloud. NewsFactor Network. [online] Available at: http://www.newsfactor.com/story.xhtml?story_id=94646# [Accessed 19 Aug. 2015].

Lee, R., Assante, M. and Conway, T. (2014). German Steel Mill Cyber Attack. ICS CP/PE (Cyber-to-Physical or Process Effects) case study paper. [online] SANS Industrial Control Systems. Available at: https://ics.sans.org/media/ICS-CPPE-case-Study-2-German-Steelworks_Facility.pdf [Accessed 6 Sep. 2015].

Li, C., Bush III, R., Dollar, D. and Wright, D. (2015). What’s at stake at the U.S.-China Strategic and Economic Dialogue?. The Brookings Institution. [online] Available at: http://www.brookings.edu/blogs/up-front/posts/2015/06/17-us-china-strategic-economic-dialogue [Accessed 6 Sep. 2015].

Li, S. (2015). Target reaches deal with Visa over 2013 data breach. Los Angeles Times. [online] Available at: http://www.latimes.com/business/la-fi-target-breach-settlement-20150818-story.html [Accessed 19 Aug. 2015].

Libicki, M. (2009). Cyberdeterrence and cyberwar. Santa Monica, CA: RAND.

Liptak, K., Schleifer, T. and Sciutto, J. (2015). China might be building vast database of federal worker info, experts say. CNN. [online] Available at: http://edition.cnn.com/2015/06/04/politics/federal-agency-hacked-personnel-management/index.html [Accessed 12 Aug. 2015].

Lye, K. and Wing, J. (2005). Game strategies in network security. International Journal of Information Security, [online] 4(1-2), pp.71-86. Available at: http://web.a.ebscohost.com/ehost/pdfviewer/pdfviewer?sid=53a89733-1517-45ee-94c2-803ed034db49%40sessionmgr4001&vid=1&hid=4107 [Accessed 26 Jul. 2015].

Mahnken, T. and Maiolo, J. (2008). Strategic studies. Milton Park, Abingdon, Oxon: Routledge.

Mandiant, (2013). APT1: Exposing One of China's Cyber Espionage Units. Mandiant Intelligence Center Report. [online] Mandiant. Available at: http://intelreport.mandiant.com/ [Accessed 31 Aug. 2015].

Marczak, B., Weaver, N., Dalek, J., Ensafi, R., Fifield, D., McKune, S., Rey, A., Scott-Railton, J., Deibert, R. and Paxson, V. (2015). China’s Great Cannon. [online] University of Toronto. Available at: https://citizenlab.org/2015/04/chinas-great-cannon/ [Accessed 31 Aug. 2015].

Martin, L. (1992). Interests, Power, and Multilateralism. International Organization, [online] 46(4), pp.765-792. Available at: http://www.jstor.org.ezproxy.soas.ac.uk/stable/2706874 [Accessed 7 Sep. 2015].

Mazzetti, M. and Levin, D. (2015). Obama Administration Warns Beijing About Agents Operating in U.S. The New York Times. [online] Available at: http://www.nytimes.com/2015/08/17/us/politics/obama-administration-warns-beijing-about-agents-operating-in-us.html?smid=fb-nytimes&smtyp=cur [Accessed 16 Aug. 2015].

McHugh, J. (2001). Intrusion and intrusion detection. International Journal of Information Security, [online] 1(1), pp.14-35. Available at: http://web.b.ebscohost.com/ehost/pdfviewer/pdfviewer?sid=bd58f7b9-d9ad-4ad2-92b4-60002817d85a%40sessionmgr198&vid=1&hid=125 [Accessed 26 Jul. 2015].

Mearsheimer, J. (1995). The False Promise of International Institutions. International Security, [online] 19(3), pp.5-49. Available at: http://mearsheimer.uchicago.edu/pdfs/A0021.pdf [Accessed 7 Sep. 2015].

Mitchell, M. (2014). Attacking the energy grid: cyber secrets worth stealing inside your home. University of Toronto News. [online] Available at: http://www.news.utoronto.ca/attacking-energy-grid-cyber-secrets-worth-stealing-inside-your-home [Accessed 14 Aug. 2015].

Mukaram, A. (2014a). Cyber Threat Landscape: Basic Overview and Attack Methods. [Blog] Recorded Future. Available at: https://www.recordedfuture.com/cyber-threat-landscape-basics/ [Accessed 27 Jul. 2015].

Mukaram, A. (2014b). Cyber Threat Landscape: Attackers and Operations. [Blog] Recorded Future. Available at: https://www.recordedfuture.com/cyber-threat-landscape-attackers/ [Accessed 27 Jul. 2015].

Nakashima, E. (2011a). List of cyber-weapons developed by Pentagon to streamline computer warfare. The Washington Post. [online] Available at:

http://www.washingtonpost.com/national/list-of-cyber-weapons-developed-by-pentagon-to-streamline-computer-warfare/2011/05/31/AGSublFH_story_1.html [Accessed 19 Aug. 2015].

Nakashima, E. (2011b). NSA allies with Internet carriers to thwart cyber attacks against defense firms. The Washington Post. [online] Available at: http://www.washingtonpost.com/national/major-internet-service-providers-cooperating-with-nsa-on-monitoring-traffic/2011/06/07/AG2dukXH_story.html [Accessed 18 Aug. 2015].

Ningzhu, Z. (2014). Xi Jinping leads Internet security group. Xinhua. [online] Available at: http://news.xinhuanet.com/english/china/2014-02/27/c_133148273.htm [Accessed 30 Aug. 2015].

Pagliery, J. (2015). To avoid Sony's fate, companies play war games. CNN. [online] Available at: http://money.cnn.com/2015/01/26/technology/security/pwc-hacking-simulator/index.html [Accessed 20 Aug. 2015].

People's Daily, (2015). VPN providers 'must obey rules'. [online] Available at: http://en.people.cn/business/n/2015/0128/c90778-8842119.html [Accessed 19 Aug. 2015].

PwC, (2015). 18th Annual Global CEO Survey. CEO Survey. [online] PricewaterhouseCoopers. Available at: http://www.pwc.com/gx/en/ceo-survey/2015/assets/pwc-18th-annual-global-ceo-survey-jan-2015.pdf [Accessed 20 Aug. 2015].

Qiao, L. and Wang, X. (1999). Unrestricted Warfare. Beijing: PLA Literature and Arts Publishing House.

Roggeveen, S. (2014). Interview: Peter Singer on cybersecurity and cyberwar, part 3. The Interpreter. [online] Available at: http://www.lowyinterpreter.org/post/2014/02/06/Interview-Peter-Singer-on-cybersecurity-and-cyberwar-part-3.aspx [Accessed 30 Aug. 2015].

Romm, T. (2013). U.S.-China cybersecurity talks slow. Politico. [online] Available at: http://www.politico.com/story/2013/07/us-china-cybersecurity-093909 [Accessed 31 Aug. 2015].

Sanger, D., Barboza, D. and Perlroth, N. (2013). Chinese Army Unit Is Seen as Tied to Hacking Against U.S. The New York Times. [online] Available at: http://www.nytimes.com/2013/02/19/technology/chinas-army-is-seen-as-tied-to-hacking-against-us.html [Accessed 13 Aug. 2015].

Schiller, B. (2009). Chinese ridicule U of T spy report. Toronto Star. [online] Available at: http://www.thestar.com/news/2009/04/01/chinese_ridicule_u_of_t_spy_report.html [Accessed 16 Aug. 2015].

Schleifer, T. (2015). How China could have hacked the U.S. government in 10 steps. CNN. [online] Available at: http://edition.cnn.com/2015/06/05/politics/chinese-data-hack-ten-steps/index.html [Accessed 12 Aug. 2015].

Tian, S. (2015). Op-Ed: Irresponsible remarks on China's hacking another case of habitual U.S. slander. Xinhua. [online] Available at: http://news.xinhuanet.com/english/2015-06/05/c_134300869.htm [Accessed 13 Aug. 2015].

Shi, T. and Riley, M. (2014). China Halts Cybersecurity Cooperation After U.S. Spying Charges. Bloomberg. [online] Available at:

http://www.bloomberg.com/news/articles/2014-05-20/china-suspends-cybersecurity-cooperation-with-u-s-after-charges [Accessed 31 Aug. 2015].

Steadman, I. (2013). Reports find China still largest source of hacking and cyber attacks. Wired. [online] Available at: http://www.wired.co.uk/news/archive/2013-04/24/akamai-state-of-the-internet [Accessed 17 Aug. 2015].

The Embassy of the People's Republic of China in New Zealand, (2011). China, Russia and Other Countries Submit the Document of International Code of Conduct for Information Security to the United Nations. [online] Available at: http://nz.chineseembassy.org/eng/zgyw/t858978.htm [Accessed 6 Sep. 2015].

The Guardian, (2015). Pakistan tried to tap international web traffic via underwater cables, report says. [online] Available at: http://www.theguardian.com/world/2015/jul/23/pakistan-tried-to-tap-international-web-traffic-via-underwater-cables-report-says?CMP=share_btn_tw [Accessed 26 Jul. 2015].

The White House, (2011). International Strategy for Cyberspace. Washington: The President of the United States.

The White House, (2015). SECURING CYBERSPACE - President Obama Announces New Cybersecurity Legislative Proposal and Other Cybersecurity Efforts. [online] Available at: https://www.whitehouse.gov/the-press-office/2015/01/13/securing-cyberspace-president-obama-announces-new-cybersecurity-legislat [Accessed 6 Sep. 2015].

Thompson, L. (2011). Cyberwarfare May Be A Bust For Many Defense Contractors. Forbes. [online] Available at: http://www.forbes.com/sites/beltway/2011/05/09/washingtons-cyberwarfare-boom-loses-its-allure/ [Accessed 17 Aug. 2015].

Thomsen, D. (2001). Introduction to the classic papers. Seventeenth Annual Computer Security Applications Conference. [online] Available at: http://ieeexplore.ieee.org/xpl/login.jsp?tp=&arnumber=991532&url=http%3A%2F%2Fieeexplore.ieee.org%2Fstamp%2Fstamp.jsp%3Ftp%3D%26arnumber%3D991532 [Accessed 25 Jul. 2015].

Times Live, (2011). South Korea opens cyber-war school. [online] Available at: http://www.timeslive.co.za/scitech/2011/06/29/south-korea-opens-cyber-war-school [Accessed 18 Aug. 2015].

Turnbull, G. (2011). Report: Cyber Attacks Against South Korea Were ‘War Drills’ by the North. Time. [online] Available at: http://techland.time.com/2011/07/06/report-cyber-attacks-against-south-korea-were-war-drills-by-the-north/#ixzz1TsqOm1ua [Accessed 17 Aug. 2015].

US Department of Defense, (2015). The Department of Defense Cyber Strategy: April 2015. Washington D.C.: The Department of Defense of the United States of America.

US Department of Justice, (2015). U.S. Charges Five Chinese Military Hackers for Cyber Espionage Against U.S. Corporations and a Labor Organization for Commercial Advantage. [online] Available at: http://www.justice.gov/opa/pr/us-charges-five-chinese-military-hackers-cyber-espionage-against-us-corporations-and-labor [Accessed 30 Aug. 2015].

US Foreign Service Cyber Official. Interviewed by: Eliot, L. (23rd August 2015). United States of America v. Wang Dong, Sun Kailiang, Wen Xinyu, Huang Zhenyu, Gu

Chunhui [2015] (United States District Court Western District of Pennsylvania).

Wassenaar.org, (2015). The Wassenaar Arrangement | Introduction. [online] Available at: http://www.wassenaar.org/introduction/index.html [Accessed 30 Aug. 2015].

Wendt, A. (1992). Anarchy is what States Make of it: The Social Construction of Power Politics. International Organization, [online] 46(2), pp.391-425. Available at: http://www.jstor.org.ezproxy.soas.ac.uk/stable/2706858 [Accessed 7 Sep. 2015].

Wertime, D. (2015). Sorry, China, the Internet You’re Looking for Does Not Exist. Foreign Policy. [online] Available at: http://foreignpolicy.com/2015/08/06/china-the-internet-youre-looking-for-does-not-exist/ [Accessed 30 Aug. 2015].

World Conference on International Telecommunications, (2012). Russian Federation: Proposals for the Work of the Conference. Dubai: International Telecommunications Union.

Yan, L. (2015). China launches 'online police stations' to strengthen cyber security. China News Service. [online] Available at: http://www.ecns.cn/2015/08-05/175817.shtml [Accessed 30 Aug. 2015].

Assessing the importance of electricity market design for meeting the EU’s long-term energy and climate targets: The paradox of

how a transition towards renewables is undermining the transition towards renewables.

Martin Sedgwick

Abstract The EU has adopted long-term energy and climate targets that will require the near-total decarbonisation of its power sector, with renewables widely expected to become the dominant form of future generation. Several studies demonstrate the feasibility of implementing a low or zero-carbon electricity system but few authors have considered how the associated electricity markets would work. Current European electricity markets are based on the principle that wholesale electricity prices are equal to the short-term marginal costs (STMC) of the system, which, for conventional thermal generation, broadly equate to the power plant’s fuel costs. As renewables lack any fuel costs, they are often described as having zero or near-zero marginal costs. A growing number of authors now acknowledge that the expansion of renewables is exacerbating deficiencies within the current market design and that transforming the EU’s electricity system will also require a fundamental redesign of European electricity markets. However, where reforms are discussed, they generally assume the continuation of the marginal cost pricing paradigm. This paper makes an important contribution to the debate by highlighting the deficiencies of the current market design for a near-zero marginal cost system and the urgent need to consider more radical alternatives.

Introduction In recent years, the European Union (EU) has consistently stated its long-term objective of achieving an 80-95% reduction in GHG emissions by 2050 and it is generally acknowledged that meeting this target will require a fundamental transformation the EU’s electricity system. Several studies demonstrate the feasibility of implementing a low or zero-carbon electricity system, with renewables widely expected to become the dominant form of electricity generation by the middle of this century. However, limited consideration has been given to how the associated electricity markets would work for a zero-carbon system. A growing number of authors now recognise that the current market design was developed over 20 years ago in an era dominated by fossil fuel generation and that the expansion of renewables is exacerbating deficiencies within the current market design. Decarbonising the power sector will therefore require a fundamental redesign of European electricity markets. According to the theory underpinning the current market design – Peak Load Pricing Theory – in competitive markets, wholesale electricity prices should equal the marginal costs of the last power plant required to meet demand. For conventional thermal generation, marginal costs largely equate to the power plant’s fuel costs and, as renewable energy systems (RES) do not have to pay fuel costs, they are often described as having zero or near-zero marginal costs. Some analysts have considered the market reforms needed to ensure the stability of the electricity system in the short to medium term, where conventional thermal generation retains a significant role but there has been limited discussion of potential electricity market designs for a low or zero-carbon system. Many of the possible market reforms discussed implicitly assume the continuation of the marginal cost pricing paradigm and may therefore be ill-suited to the EU’s future electricity system. As reforming electricity markets is a lengthy and difficult process, the proposed reforms may therefore become obsolete before they are implemented. This paper makes an important contribution to the debate by highlighting the urgent need to consider more radical alternatives. Electricity markets have an important role to play in sending the appropriate price signals to ensure investment in new capacity and the long-term adequacy of the system. If we fail to design a market that works for a near-zero marginal cost system, we risk compromising both investments in new capacity and the EU’s long-term energy and climate targets.

Literature review The relevant literature can be divided into three categories. Some authors consider the theoretical, technical or economic feasibility of transitioning towards a low-carbon system. Others focus on the effects of renewables on electricity prices, either in specific markets with significant shares of RES generation, such as Germany or Spain, or on the wider implications of expanding renewables at a regional or global level. Finally, some authors consider the market reforms needed to support the continued expansion of renewables, although they generally focus on the short to medium term, wherein conventional thermal generation remains a significant or dominant form of electricity generation.

On decarbonising the power sector

Analyses differ over the optimal means of achieving power sector decarbonisation. Some papers demonstrate the technical, theoretical or economic feasibility of an entirely renewables based system (EREC, 2010; Jacobson & Delucchi, 2011; Edenhofer et al., 2013) whilst others highlight the importance of alternative low-carbon technologies for achieving the required reductions and reducing the overall cost of the transition (EC, 2011a; IEA, 2013; DeCanio & Fremstad, 2011). Blesl et al. (2011) identify the optimal breakdown of the EU’s 2050 emissions reduction targets at the member state level to provide the most cost effective means of achieving the required reductions. They conclude electricity generation will be almost completely decarbonised and that renewables will become the dominant form of production, supported by nuclear and Carbon Capture and Storage (CCS). Jägemann et al. (2013) consider the economic feasibility of decarbonising Europe’s power sector to meet the EU’s 2050 targets, arguing that combining renewables with nuclear and CCS represents the lowest cost option. Both papers focus only on the investment costs associated with deployment, rather than the impact on wholesale prices and investment returns. EDF (2015) considers what technical challenges a 60% renewables European electricity system by 2030 would present and emphasises the need to develop supporting smart grid, storage and demand-response technologies to ensure grid stability. The European Climate Foundation (ECF) argues that 50% of the EU’s electricity generation must come from renewables by 2030 to ensure the longer-term 2050 targets remain viable (ECF, 2011a). They project that the expansion of renewables will increase price volatility and reduce wholesale prices, but this reduction will not be problematic as long as European electricity markets are fully integrated. The European Renewable Energy Council (2014) demonstrates the feasibility of achieving a 100% renewable energy system by 2050 across three key sectors: electricity; heating and cooling; and transportation. Their discussion of market reform is limited to the need to continue liberalising and integrating European electricity markets. The European Commission’s Energy Roadmap 2050 (2011b) identifies several decarbonisation pathways involving different combinations of renewables, nuclear and CCS. Across all scenarios, renewables are expected to become the dominant form of electricity generation and as much as 99% in the high renewables scenario. Whilst the continued decline in wholesale prices is recognised, the discussion of potential solutions is limited to promoting greater market integration and the coordinated development of capacity mechanisms. On how renewables affect electricity prices Böckers et al. (2013) assess the impacts of solar and wind generation on wholesale prices in Spain between 2008 and 2012. They suggest that the continued expansion of renewables could price conventional generation out of the market and that ‘sophisticated capacity mechanisms’ may be required to ensure security of supply. Cossent et al. (2011) analyse the challenges associated with increasing renewables and distributed generation in Spain, highlighting the importance of developing the associated smart metering and smart grid technologies in parallel. Ketterer (2014) examines the relationship between wind power and electricity prices in Germany, showing that the expansion of renewables leads to reduced wholesale prices and increased price volatility. This discourages investment and therefore further market reforms are needed, such as increased integration and capacity mechanisms. Paraschiv et al. (2014) and Fanone et al. (2013) also analyse the depressive effect of renewables on electricity prices in Germany, with the latter specifically focusing on the phenomenon of negative electricity prices resulting from high RES generation.

At a regional level, a report by the European Commission, “Energy Prices and Costs in Europe” (EC, 2014c) analyses the trends in wholesale and retail prices across the EU and its member states between 2008 and 2012 to explain the growing disconnect between falling wholesale prices and rising retail prices. Edenhofer et al. (2013) consider the economic potential of renewables and conclude that, whilst their potential is greater than presently realised, renewables exacerbate the existing deficiencies of liberalised electricity markets and produce higher volatility and more extreme prices. Consequently, capacity mechanisms and alternative market designs may be needed to ensure security of supply. Hirth (2013) analyses the impact of declining wholesale prices on renewable generators themselves. He argues that impact is greatest when renewables’ output is at its highest, thereby reducing the market price at the time renewables generators need it to be higher. Haas et al. (2013b) assess the impacts of expanding renewables on European electricity markets. They argue that this will create higher price volatility and extended periods of low or even negative prices and, consequently, markets will need to undergo a radical transformation to support the continued expansion of renewables. Trembath (2015) argues that, since renewables reduce the price of electricity whenever they generate, this limits the amount of RES generation that can be accommodated by the system without risking the economic viability of investments in renewables. On the need for market reform

Auverlot et al. (2014) present the conflicting and contradictory nature of EU energy and climate policies alongside energy market reforms. They highlight renewables’ impact on electricity wholesale markets, with consideration given to potential market reforms, including greater market integration, the reintroduction of long-term contracts and the development of EU-wide capacity mechanisms. Green (2008) compares the EU liberalised electricity market design to the US ‘Standard Market Design’, concluding that US market design is better suited to a low-carbon electricity system, in part, due to its reliance on capacity mechanisms. The European Commission (EC) has published the ‘Energy Union Package’ (2015a) and ‘Summer Package’ (2015b) documents discussing the required transformation of European electricity markets and systems, noting the effect of renewables on wholesale prices. For the EC, it will be necessary to fully integrate European electricity markets, invest in smart grid, smart metering and storage technologies and incentivise greater consumer participation in electricity markets through dynamic pricing. Helm (2014b) argues that an urgent reassessment is needed of the EU’s contradictory policies on energy, climate and market reform. He also suggests an EU-wide capacity market will be necessary to support the continued expansion of renewables and ensure security of supply. The National Renewable Energy Laboratory (NREL) has produced several reports (2012; 2013a; 2013b; and 2014) which analyse the importance of electricity market design and compare different market designs globally to identify the optimal design for a low-carbon electricity system. Several authors focus on the importance of increasing consumer participation in electricity markets to support a transition towards renewables. Gronheit et al. (2011) assess the importance of demand response and storage technologies for a system with significant renewables generation. Chao (2010) highlights the developments in demand response and dynamic pricing over the last three decades and discusses the challenges for further expansion of these technologies. Geelen et al. (2013) summarise the findings of several European pilot studies on smart metering and demand response. Lijesen (2007) critically examines the potential of demand response, arguing that price elasticity of electricity is low for all

consumer types, even large commercial consumers that participate in electricity markets and have access to real-time price information. The impact of the EU’s long-term energy and climate objectives on the power sector Since 2009, the EU has consistently stated its long-term objective of achieving an 80-95% reduction in GHG emissions by 2050. Although the drivers of EU energy and climate policies have changed during this time, from initial concerns over climate change to re-emergent concerns over economic and energy security, these long-term targets have been repeatedly reaffirmed and similar policies have been adopted at the national level by individual member states. It is generally recognised that meeting the EU’s 2050 targets will require the power sector to be almost completely decarbonised (EC, 2011b; IEA, 2014). Analyses differ as to whether renewables can supply all the EU’s electricity needs, or whether alternative low-carbon technologies will also be needed. Regardless of the share afforded to nuclear and CCS, it seems likely that renewables will become the predominant form of generation in the EU’s future electricity system. EU energy and climate policy: shifting drivers and motivations

Sustainability and climate change The EU first adopted energy and climate targets in 1997 under the Kyoto Protocol, where the original 15 EU member states, keen to demonstrate leadership on climate change, committed to an 8% reduction in GHG emissions by 2012 (WRI, 2012). A decade later, with expectations of a successor agreement to be agreed at COP15 in Copenhagen, the EU unilaterally announced the 2008 Climate Change Package (CCP) with the following targets to be achieved by 2020: a 20% reduction in GHG emissions compared to 1990 levels; renewable energy sources to provide 20% of gross final energy consumption; and a 20% improvement in energy efficiency compared to a projected baseline (Ibid.). The following year, the EU also agreed a longer term target of achieving 80-95% GHG emissions reductions by 2050 (Ibid.). Following the CCP’s adoption, several real world events have invalidated some of the assumptions underpinning the EU’s energy and climate targets: gas and oil prices did not continue to rise as expected; the climate negotiations in Copenhagen faltered; the Fukushima disaster created renewed opposition to nuclear; and expanding renewables did not produce lower electricity prices for European consumers (Helm, 2014a). Despite these developments, the EU’s support for the energy and climate targets continues, with EU heads of state recently endorsing the European Council’s enhanced 2030 targets of 40% GHG emissions reductions, 27-30% renewable energy in gross final energy consumption and a 27% improvement in energy efficiency (WRI, 2012). The EU’s policies are not without criticism. Some argue that the 2030 targets indicate a declining level of ambition and are inconsistent with the 2050 targets (TCG, 2014; Schiermeier, 2014). Others question the overlapping and incompatible nature of the climate change package alongside the EU’s other key energy policy, the Internal Energy Market (IEM) (Bettzüge, 2014; Helm, 2014b), highlighting the fact that national policies promoting the expansion of renewables are antithetical to the goals of the IEM (Helm, 2014b). In spite of such criticisms, the EU has made significant progress towards a low-carbon economy and is “leading the efforts of IEA member countries” in reducing its emissions intensity (IEA, 2014). Achieving its 2030 GHG emissions reductions target would make the EU one of the world’s least carbon-intensive economies, with energy-related CO2 emissions declining at

almost double the rate achieved since 2000 and at least 50% of electricity generated from renewables (IEA, 2015; ECF, 2011a). Economic and energy security More recently, concerns over the EU’s economic and energy security have re-emerged as the primary drivers of energy and climate policy (IEA, 2014). The EU is the largest energy importer in the world, importing 53% of its energy in 2014 at a cost of around €400 billion (IEA, 2015; EC, 2015a). Domestic fossil fuel production is declining rapidly and the outlook for unconventional sources remains uncertain. With its ageing infrastructure, roughly half of the EU’s generating capacity needs replacing over the next two to three decades and, despite a significant decline in wholesale prices, EU industries pay more for electricity than many international competitors and around 40% more than their US counterparts (EC, 2014c). The combination of the US shale revolution, renewed hostilities between Russia and the Ukraine, and rising energy demand from emerging economies has underlined the economic necessity behind securing affordable, available and sustainable energy (Helm, 2014b). It is therefore unsurprising that the newly formed Juncker Commission has made energy a key priority, announcing the ‘Energy Union’ strategy as means of securing “a fundamental transformation of Europe’s energy system” (EC, 2015a). Further support for the EU’s collective target can be seen in the national energy and climate policies of individual member states. In EU legislative terms, energy policy is considered a national rather than shared competence but for member states it is an increasingly common concern. A study by the Netherlands Environment Agency found that “Many European countries are developing plans for a transition towards a low carbon economy by 2050” (Notenboom et al., 2012). For instance, Denmark is targeting 100% renewable energy by 2050; France, Germany and the UK have all set 2050 emissions reduction targets of 75% or greater; whilst the Belgian and Dutch governments have adopted shorter term targets and commissioned studies into the options for switching to a low-carbon economy by 2050 (Ibid.). Whilst the renewables potential and specific policy drivers vary for each country, all will need to undertake “profound structural adjustments in the energy mix …to achieve a low-carbon economy ” (Ibid.). It is also recognised that the required transformation’s costs will be greatly reduced if member states cooperate and coordinate their actions. If the EU can successfully transform its power sector, the potential prize is significant. Implementing a fully integrated, low-carbon electricity system, would increase security of supply, avoid high energy import bills and create opportunities for European companies to become market leaders in low-carbon technologies (Bettzüge, 2014). The need for power sector decarbonisation Given the comparative intractability of emissions from other sectors (e.g. transport, agriculture), meeting the EU’s 2050 targets will require the near total decarbonisation of electricity generation (EC, 2011a; PWC, 2011). Analysis by the European Commission suggests it is possible to “almost totally eliminate [power sector] CO2 emissions by 2050” (Ibid.) (See Fig. 1). The Energy Roadmap 2050 (EC, 2011b) presents several alternative pathways for meeting the 2050 target, with power sector emissions falling between 93% to 99% across all scenarios. Renewables are expected to generate between 60% and 97% of the EU’s required electricity, making them either the predominant form or essentially the only form of generation. Using the most optimistic assumptions, EREC (2010) suggests that renewables could provide up to

143% of EU electricity demand by 2050, making the EU a net electricity exporter. According to the IEA, by 2035, electricity from renewables could account for almost half the world’s generation simply by accelerating trends that are already underway, rather than requiring any radical shift in policy (IEA, 2013; IEA, 2015). Meeting the EU’s 2020 targets will require around 34% of electricity generation to come from renewables (EREC, 2010) and, as a result of EU policies, the total share of renewables generation reached 23.5% in 2012 (Haas et al., 2013a). Fig 1. Emissions reductions required by sector to meet the 2050 target

The continued expansion of renewables requires the development of several associated technologies (Roberts, 2015). Supporting the intermittent and variable nature of renewables will necessitate further investment in grid and storage technologies (Hall, 2008). As prime locations for renewables deployment are not always close to demand centres, more distributed generation and investment in ‘smart grid’ infrastructure will be needed. Greater consumer participation in electricity markets to reduce the required peak capacity will require the widespread deployment of smart meters and smart appliances (Geelen et al., 2013). The costs and challenges associated with developing these technologies are significant and their deployment also has implications for electricity market design, as will be discussed in Section 5. For the purposes of this paper, however, it is assumed that their deployment will proceed in parallel with the expansion of renewables to form part of the EU’s future electricity system.

Fig. 2 Growth in EU renewables electricity production 1990 - 2013

Source: Eurostat The future role of alternative low carbon technologies

For some authors, decarbonising the power sector will only be economically feasible by supporting renewables with increased generation from nuclear and CCS (Jägemann et al., 2013; DeCanio & Fremstad, 2011). Aside from reducing the cost of the transition, CCS offers the important possibility of net negative emissions (IEA, 2013). It can also make a greater contribution towards reducing industrial emissions, where the potential for renewables is limited (EC, 2011b). As CCS and nuclear technologies can generate on demand and increase or reduce output as required, in contrast to renewables, they provide ‘flexible’ and ‘dispatchable’ electricity, both of which are important characteristics for ensuring grid stability (NREL, 2014). Estimates for the potential future share of CCS and nuclear generation vary. Excluding the high renewables scenario, the European Commission’s analysis suggests that CCS could provide 19-32% of the EU’s electricity by 2050 (EC, 2011b), whilst others project a slightly higher range of 25-35% (Odenberger et al., 2013). The maximum share of nuclear in the EU’s Energy Roadmap increases to 18%, but only if CCS is delayed (EC, 2011b). Blesl et al. (2011) estimate that nuclear energy will provide 19% of primary energy consumption across the EU by 2050. According to the IEA’s 450 Scenario, a massive global expansion of nuclear is needed but the largest increases arise in China and India, with only modest capacity additions occuring within the EU (IEA, 2013). Using all low carbon technologies may be considered more cost effective but “Nuclear power and CCS are currently facing strong headwinds” (Jägemann et al., 2013). Post-Fukushima, several EU member states are phasing out existing nuclear plants (Mez, 2012) and CCS may not be available on a commercial scale before 2030, given rising public concerns over storage

and transportation (Jägemann et al., 2013). Contrary to initial expectations that nuclear electricity generation would become ‘too cheap to meter’, it is the only energy technology for which costs actually increase over time (Kessides, 2012). Flagship projects of the so-called ‘nuclear renaissance’, such as the Olkiluoto project in Finland, have suffered huge delays and cost overruns, leading some analysts to conclude that “the completion or construction of new nuclear power plants constitutes a virtually insurmountable financing problem” (Mez, 2012). The outlook for CCS is equally uncertain. Despite significant public support for CCS demonstration projects, “attempts to launch the technology at a commercial scale in the EU … are struggling” (Scott, 2013). Two-thirds of the 11 active EU CCS project proposals are unlikely to be delivered and the remainder will not be completed by the original timetable of 2015 (Ibid.). In addition to numerous technical, economic, political and legal challenges relating to deployment, potential storage sites are unevenly distributed and widespread CCS deployment would require an extensive trans-European pipeline network of over 30,000km to be built, adding considerable complexity to the planning and construction process (Umbach, 2011). Consequently, it is unlikely that CCS will be available on a commercial scale before 2030, a decade later than would be needed to make a meaningful contribution to EU emissions reduction targets (Scott, 2013). Both CCS and nuclear also suffer disadvantages in terms of their emissions reductions potential. CCS plants are up to 50% less efficient than conventional plants, thereby increasing emissions from the extraction, processing and transportation of greater quantities of fossil fuels (Umbach, 2011). Far from being emissions free, full lifecycle emissions from nuclear have been estimated at 90 – 140g CO2 per kWh (Mez, 2012). Whilst alternative low-carbon technologies exist, even under the most optimistic scenarios for nuclear and CCS, it seems likely that renewables will become the dominant form of generation in the EU’s future electricity system and their continued growth remains “an essential component of any credible plan” (Trembath, 2015). The current design of EU electricity markets It is widely recognised that achieving the required transformation of the EU’s electricity system will necessitate a fundamental redesign of European electricity markets (EC, 2015b; Haas et al., 2013a; Roques, 2014). The current market was developed more than 20 years ago in an era dominated by conventional thermal power plants and the rapid growth of renewables is changing the nature of the system (Roques, 2014). Market liberalisation was expected to reduce prices but, contrary to expectations, retail prices for EU consumers have been increasing. The deficiencies of European electricity markets are becoming increasingly apparent (Auverlot et al., 2014) but to understand the problems inherent in the current market design, we must first consider the reasons for its adoption and the theory that underpins it. Two decades of reform: the liberalisation of EU electricity markets

There are many different ways of organising electricity markets, with notable differences between markets globally and between individual EU member states (Green, 2008). Across all designs, a fundamental choice exists between whether electricity prices are determined by market competition or set by a central authority in the form of regulated tariffs (Bettzüge, 2014). For much of the twentieth century, the dominant approach in Europe was to have highly regulated markets with the majority of assets owned by a single company. Electricity prices were determined by a calculation of the total systems costs, divided by the total amount

of electricity generated, with regulated tariffs for residential and commercial consumers (Haas et al., 2013a). This approach was considered inefficient, creating higher costs for consumers and excess capacities across much of Europe (Haas et al., 2013a). The drive to liberalise EU electricity markets that began in the 1990s was largely based on the belief that competitive markets are more efficient and would lead to reduced prices for consumers (Auverlot et al., 2014). Whilst the liberalisation of EU electricity markets is still a work in progress, with state ownership of utilities and participation in electricity markets persisting in many countries, significant progress has been made and wholesale markets have now been established in most member states (Ibid.). Market liberalisation and the growth in renewables reduced electricity wholesale prices but contrary to policymakers’ expectations retail prices have increased (EC, 2014b). Current market design: Peak Load Pricing Theory (PLPT) The theory underpinning liberalised market design, ‘Peak Load Pricing Theory’ (also known as ‘marginal cost pricing’), asserts that, in a competitive market, demand for electricity will be met using the optimal mix (i.e., most cost-efficient) of generating technologies (Roques, 2014; IEA, 2013). Electricity has certain unique characteristics that make it suitable for PLPT. Supply and demand must be kept in equal balance to respect the physical constraints of the grid and avoid risking blackouts or system failure (Green, 2008). Electricity can also be generated by a variety of technologies, each of which have different cost profiles over different time horizons. Some technologies have high fixed costs and low variable costs and vice versa (Böckers et al., 2013). Peak Load Pricing Theory focuses on the variable costs, also known as the ‘marginal cost’ of production, which is the cost of producing an additional unit of electricity, excluding any fixed costs associated with building the power plant, i.e., capital expenditure (Paraschiv et al., 2014). According to PLPT, to meet demand, electricity generated by plants with the lowest marginal costs will be dispatched first and plants with higher marginal costs will only be deployed as demand rises (Ibid.). By always using the lowest marginal cost plants first, the total cost of generating the required amount of electricity is reduced (IEA, 2013). Ranking plants in ascending order of marginal costs is known as the ‘merit order’ and it can be used to identify different technologies as either base-load, mid-merit or peak-load (‘peaking’) plants (Paraschiv et al., 2014). Base load plants generally have high fixed costs and low marginal costs, whereas peaking plants are usually cheaper to build but have higher marginal costs. At any given time, the market price of electricity (i.e., wholesale price) is determined by the intersection of supply and demand, equating to the marginal costs of the last power plant called to meet demand (see Fig. 3). Whenever peaking plants are needed to meet demand, wholesale prices rise as the system’s marginal costs are increased. In theory, and in the absence of any other price distortions, using PLPT to keeping wholesale prices to a minimum also reduces retail prices.

Fig 3. The merit order of production (excluding non-hydro renewables)

Source: Own diagram The importance of fuel costs In a system largely dominated by fossil fuel generation, the marginal cost of generating electricity broadly equates to the system’s fuel costs, i.e., coal and gas (WRI, 2015). More recently, other notable costs such as CO2 allowances under the EU Emissions Trading Scheme (ETS) are also included in the marginal cost (Paraschiv et al., 2014). Frydenberg et al. (2014) consider whether the relationship between fuel costs and electricity prices holds statistically by analysing over 1,500 price observations collected between 2006 and 2012 in three major European markets (German, Nordpool and UK). Their analysis shows high levels of correlation and cointegration across all three markets, meaning that movements in fuel costs and electricity prices happen synchronously and, although prices may diverge in the short term, they will eventually re-converge. Fig 4. Gas and electricity prices in Germany and the UK (2006 – 2012)

Source: Frydenberg et al., 2014 Peak Load Pricing Theory in practice To understand why the marginal costs of electricity generation (i.e., fuel costs) determine wholesale prices in practice, it is helpful to understand how electricity is traded (for a more

detailed account, see Elexon, 2013; Green, 2008; Roques, 2014). Electricity is always traded for future delivery (usually in hourly or half hourly time periods), with different markets covering different time horizons (Roques, 2014). These can range from several years in advance (i.e., forward markets) to days, hours and even minutes ahead (i.e., spot, intraday and imbalance markets). In competitive markets, generators are expected to sell electricity at a price approximating their marginal costs. To respect the physical limits of the electricity system, the entity responsible for running the market (either the system operator or an independent power exchange) has to ensure that total supply across all bids matches the projected demand for that settlement period. Some generators may be asked to increase or reduce their supply as necessary and the market price received by all generators for each period is set at the price (i.e., bid) of the last plant called to meet demand (Elexon, 2013). If the market price falls below their marginal costs, the generator would lose money from the sale and so would not bid for that period, although any potential loss would need to be offset against the cost of halting and restarting production. Recovering fixed costs Although Peak Load Pricing Theory focuses on variable or marginal costs, it is important to ensure generators receive sufficient remuneration from the sale of electricity to cover their fixed costs. According to PLPT, generators recover these costs in the form of ‘infra-marginal rents’ or ‘scarcity rents’, depending on their position in the merit order (see Fig 5) (Auverlot et al., 2014). Base-load and mid-merit plants receive infra-marginal rents whenever plants with higher marginal costs are needed and consequently the wholesale price rises above their own marginal costs. The most expensive plants to run (‘Peaking plants’) receive scarcity rents when demand is at its very highest. To ensure peaking plants recover their fixed costs, scarcity rents need to be sufficiently high to equal to the ‘Value of Lost Load’ (VOLL), i.e., the amount they could have earned by generating at other times (Ibid.). Fig 5. Infra-marginal rents and scarcity rents

Source: Own diagram Deficiencies of the current market design Electricity markets have two important roles to play, one short term and one longer term (NREL, 2013; Roques, 2014; Green, 2008). In the short term, markets ensure the reliable and

cost-efficient operation of the electricity system on a daily basis, i.e., reducing prices in the short term by dispatching technologies according to the merit order. Over the longer term, electricity markets are responsible for sending appropriate price signals to promote investment in new generating capacity, thereby avoiding future supply shortages and maintaining system adequacy. Whilst the current market design may be effective at ensuring the cost-efficient operation of the system in the short-term, there are growing concerns over its ability to maintain long-term system adequacy (Green, 2008). The ‘missing money’ problem As illustrated above, in the current market design, the fixed costs of generation are recouped through the combination of infra-marginal rents and/or scarcity rents. Unless generators receive additional fiscal support, investments in electricity generation depend on a certain average price throughout the year and a minimum number of price spikes to generate scarcity rents (Böckers et al., 2013). If average prices and/or the number of price spikes fall below the level required, revenues from electricity generation will be insufficient, creating a loss for investors. This issue is sometimes referred to as the ‘missing money problem’ (Ibid.). Power plants are long-lived assets, typically operating for 20-60 years (Green, 2008). Whilst competitive markets may represent the most cost-effective means of determining the dispatch order on a short-term basis, even without the growth in renewables, it is questionable whether electricity markets alone can ensure that investments in new capacity will remain profitable over the lifetime of the investment (Green, 2008; Böckers et al., 2013). In response to the missing money problem, several EU member states have introduced or considered introducing ‘capacity mechanisms’ to provide an additional source of revenue for generators to ensure long-term system stability (NREL, 2013). The wholesale-retail price disconnect The wholesale price is the price at which generators and suppliers (i.e., retail distributors) trade electricity, whereas the retail price is that paid by the final consumer, i.e., households and businesses. Although part of the retail price relates to wholesale prices, additional components must be included, such as government taxes, retail costs and network charges. Between 2008 and 2012, although wholesale prices across the EU fell by 35-45%, retail prices rose by an average of 4% per year (EC, 2014c). This average hides significant discrepancies between member states. Retail prices for some consumers have increased by 47% over the same period and, in Germany, retail prices have doubled in the last 10 years (Auverlot et al., 2014). According to analysis by the European Commission (EC, 2014c), retail prices include three main elements: (i) energy and supply, which is predominantly the wholesale costs, plus any additional retail costs incurred by the supplier; (ii) network costs associated with the distribution and transmission of electricity; and (iii) the effects of government policies (including general taxation, e.g., VAT, as well as specific policies regarding electricity, such as Feed-in-Tariffs). The EC’s analysis shows that, whilst the energy and supply element (i.e., wholesale prices) for residential consumers has decreased, both the network charges and taxation elements have increased considerably. The growing wholesale-retail price disconnect is seen by many as the key issue affecting current EU electricity markets and is often considered symptomatic of the need for further market liberalisation. For instance, according to the EC, the growing divide “may imply that price competition in a number of retail markets is weak, allowing suppliers to avoid passing

on wholesale price reductions to retail prices” (Ibid.). In other words, liberalisation has caused wholesale prices to fall as expected but some markets are still not competitive enough and therefore consumers are not feeling the benefits. It is this paper’s contention that the continuing decline of wholesale prices should be of greater concern, given the consequent impact this will have on investment in renewables and in new generating capacity. Fig 6. Electricity price evolution by component 2008-2012

Source: European Commission (EC, 2014c)

Why renewables exacerbate deficiencies in the current market design Increasing the share of renewables for electricity generation reduces wholesale prices for three primary reasons. Firstly, as renewables only need the sun or wind to generate, their marginal costs are effectively zero (Böckers et al., 2013). Consequently, whenever they generate, renewables displace other technologies in the merit order. This is known as the ‘merit order effect’. Secondly, as renewables generation is ‘variable’ and ‘intermittent’ (i.e., it is seasonal and it depends upon the time of day and weather), maintaining system adequacy still depends on other technologies to generate when output from renewables is low (Hirth, 2013). Increasing the share of renewables therefore increases the total capacity of the system, which reduces wholesale prices in accordance with another fundamental law of economics, namely: “The greater the supply of a good, the lower its price” (Ibid.). Thirdly, the expansion of renewables alters the traditional demand curve. Distributed generation from renewables is used to meet some demand locally and can be seen to reduce demand from the grid rather than increase supply to it. This reduces the number and scale of peak pricing events (Ketterer, 2014). The merit-order effect As Peak Load Pricing Theory dictates, technologies with the lowest marginal costs are dispatched first to meet demand, thereby reducing the total system costs. As renewables have zero marginal costs, whenever they generate, they shift the merit order to the right, reducing both system costs and wholesale prices (See Fig. 7). In principle, the merit order effect of renewables impacts all technologies with higher marginal costs but there is debate as to which

technologies are the most affected. Some authors expect the more expensive ‘peaking’ generators to be the first affected (Ketterer, 2014). Others believe the effect to be more ambiguous, arguing that mid-merit plants or even base load plants could suffer the greatest impact, as peaking plants are more flexible and therefore better placed to adapt their production levels to variable generation from renewables (Böckers et al., 2014; Paraschiv et al., 2014). The merit order effect of renewables is triple-locked insofar as (1) having essentially zero marginal costs makes them the first technology dispatched on an economic basis; (2) they are often granted grid priority, meaning that system operators must accept any available production from renewables; and (3) renewables in most EU member states receive additional ‘out-of-market’ payments (e.g., Feed-in-Tariffs) and can therefore earn revenue from generating even when the market price is zero (Helm, 2014a). Fig. 7. The merit order effect

Source: Own diagram Fig 8. The merit order effect with 70% renewables

Source: Own diagram Previously, with limited penetration, this impact of renewables on prices was largely insignificant but, as their share of generation increases, the merit order effect is amplified (Hirth, 2013). A simple way to consider this is to redraw Fig. 7 for a system in which the majority of generation is provided by renewables. Fig. 8 provides a simplified representation of what the merit order could look like by 2050, with 70% of electricity generation from renewables (which is at the lower end of the EU’s projections). This raises several key points. Firstly, the spread between prices at times of low and peak demand has largely disappeared, significantly diminishing infra-marginal rents. Secondly, the market price received by all generators at times of low or high demand would be substantially lower, with the level and frequency of scarcity rents greatly diminished. Thirdly, with considerably higher marginal

costs, generation from coal or gas plants fitted with CCS would not be competitive during times of low demand. Even during times of high demand, depending on the availability of renewables, CCS generation may not be required. Consequently, any CCS generation would also need to be flexible to participate in such a market, further increasing its marginal costs. Excess capacity

For countries with significant installed wind and solar capacity, when renewables produce at close to full capacity and demand is low, the total system capacity can greatly exceed demand. For instance, in Germany, although the average annual share of RES generation may only be around 12%, on certain days with the right conditions, generation can exceed 50% of demand (Paraschiv et al., 2014; The Economist, 2013). As supply in the system cannot exceed demand without risking overload, system operators can use two key mechanisms to reduce total supply: ‘Negative prices’ and ‘Curtailment’. Negative prices Although the price of electricity is generally set at the bid of the last plant called to meet demand, during times of considerable excess capacity, the system operator can set a negative price to discourage generation. In other words, generators must pay the system operator to take their supply. “It is a peculiar feature of electricity markets that prices can be negative” (Fanone et al., 2013) but this does not necessarily indicate a poorly designed market. Negative pricing generally occurs when very low demand meets unnecessarily high supply (Ibid.). As the actual quantities of electricity supply and demand are never known until after the event, generators, suppliers and system operators have to rely upon forecasts (Elexon, 2013). Even without significant renewables penetration, shortfalls and surpluses can arise for many reasons including unexpected generator outages, transmission congestion in parts of the grid, higher than expected generation or lower than expected demand. The variable and intermittent nature of renewables exacerbates this problem by creating excess system capacity. It is difficult to provide accurate predictions of weather-dependent renewables generation, particularly over longer time horizons (Fanone et al., 2013) and, as renewables often have grid priority, if renewables generation is higher than projected, it must be offset by expensive reductions elsewhere (Hirth, 2013). Base-load generators are designed to run continuously and cannot quickly increase or decrease production, meaning that, to date, the impacts of negative pricing are largely felt by more flexible mid-merit and peaking plants. Curtailment If negative pricing fails to sufficiently reduce supply, system operators may also be required to enforce mandatory curtailment. Historically, in order to maintain the balance of supply and demand in the system, some conventional thermal plants would be kept running at full load continuously whilst others are kept ‘spinning’ to ensure they can be quickly ramped up to meet rising demand (NREL, 2013b). The ability to ramp production up and down quickly is known as ‘flexibility’. Although renewables are often granted grid priority, system operators may need to force RES generators to reduce their output, since conventional thermal plants have minimum technical output levels below which they cannot fall (NREL, 2012). This issue is particularly acute at night, when winds are generally stronger and demand is at its lowest. At these times, many conventional generators are already operating at minimum output levels and, since production from base-load coal, gas and nuclear plants cannot be stopped and re-started quickly, system operators may be forced to curtail renewables generation. As curtailment is not financially motivated but is imposed by the physical constraints of the

system, it is not always compensated. Unsurprisingly, “curtailment is a growing concern in the wind and solar industry” (NREL, 2013b). As the EU transitions towards a fully integrated electricity system, it should be possible to export surplus generation to other countries, thereby reducing the risk of curtailment. However, if the share of variable renewable generation increases to become dominant across the whole power system, export may not always be an option (Trembath, 2015). Changing demand curves The third disruptive effect of renewables is on demand curves. Demand for electricity varies across every 24-hour period and over the course of the year. Historically, and depending on the region, demand is generally lowest at night and there are two peaks – a midday peak and an early evening peak (Allcott, 2011). Whilst wind generation is generally strongest at night (Paraschiv et al, 2014), solar output reaches its highest production levels around midday, thereby increasing the available system capacity at that time. Demand from the grid is further alleviated by the growing number of residential PV installations, creating an effect that has been labelled “The Californian Duck” (Goodall, 2015), given the shape created by projecting future demand curves based on recent trends (See Fig. 9). As California’s electricity system has limited interconnections with other states, the effect is particularly pronounced, but a similar effect can also be observed in Germany, a country with good interconnections (See Fig 10). Fig 9. ‘The Californian Duck’

Source: Goodall (2015)

Fig 10. Summertime hourly electricity wholesale prices relative to seasonal average price in Germany 2006 - 2012

Source: Hirth (2013) The effect of renewables on demand curves means that periods of peak pricing are becoming less certain and predictable, with renewables and conventional generation alike suffering from ever diminishing market returns (Ketterer, 2014). For renewable generators, the effect is amplified as their variable nature exerts the greatest reduction on market prices whenever their output is at its highest (Hirth, 2013; Trembath, 2015). Exacerbating the ‘missing money’ problem and the risk to investors

It is widely expected that subsidies for renewables will fall and ultimately be phased out, as the technology becomes more cost-competitive (EC, 2012; Hirth, 2013). Consequently, renewables are expected to generate returns from the market alone and be driven by private investment. For instance, the European Commission (2012) states that renewables should be ”gradually integrated into the market with reduced or no [public] support” (EC, 2012). The EU ETS is seen as critical in achieving this, by increasing the variable costs of conventional thermal power, thereby making renewables even more cost competitive by comparison (WRI, 2015). However, as demonstrated, increasing the share of renewables reduces both wholesale prices and the number of pricing peaks and so it is likely that increasing the share of renewables will exacerbate the missing money problem and thereby discourage private investors (Edenhofer et al., 2013; Böckers et al., 2013). As wholesale prices continue to decline in accordance with the current market design, it is increasingly unclear how investments in generating capacity can remain economically viable without continued and increased public support. Energy utilities have traditionally been a source of significant investment in new capacity but, as a result of declining wholesale prices, it is no longer clear whether they still have the resources to do this (The Economist, 2013). Some utilities have publically stated they expect revenues from power generation to fall 80% by 2020. Between 2008 and 2013, the market valuation of European utilities has fallen by €500 billion and the share price of Germany’s biggest utility, E.On, has fallen 75% in the same period (The Economist, 2013; FOTE, 2014). Since expanding renewables reduces both

wholesale prices and, consequently, returns on investment, “Large-scale renewable deployment will be more difficult to accomplish than many anticipate” (Hirth, 2013). Expected outcomes and possible reforms If renewables are exacerbating deficiencies within the current market design, the question arises as to how the complete decarbonisation of the power sector will impact electricity markets and what reforms are needed to support this transition. Much of the debate focuses on the short to medium-term, where the system is still in transition and remains largely dominated by conventional thermal generation (Helm, 2014a, NREL, 2012). Firstly, increasing the share of renewables is expected to produce greater price volatility and extended periods of zero or even negative prices (Haas et al., 2013a). Secondly, this volatility is expected to incentivise greater consumer participation in electricity markets and investment in storage technologies. Thirdly, some argue that capacity mechanisms and/or long-term contracts may be needed to offset declining returns from wholesale markets (NREL, 2013a). Whilst these reforms implicitly assume the continuation of the marginal cost pricing paradigm, one possible alternative involves a shift towards long-term marginal costs, also known as the ‘Levelised Cost of Electricity’, which includes both fixed and variable costs (Haas et al., 2013a). Higher volatility

For many authors, it seems a foregone conclusion that increasing the share of renewables generation will result in greater price volatility, as high renewables output will result in high prices and vice versa (Paraschiv et al., 2014; Ketterer, 2014; Gronheit et al., 2011; Eurelectric, 2011; ECF, 2011a). Furthermore, balancing intermittent renewables generation will require more flexible plants in the system. As these are more expensive to run, it will increase peak prices during times of scarcity (Böckers et al., 2013). It is also expected that wholesale prices will become zero or even negative for longer periods (EC, 2011b; NREL, 2013a). Greater price volatility and extended periods of low prices is not necessarily seen as problematic. On the contrary, increasing volatility is a key element in encouraging greater demand-response from consumers (NREL, 2012; EC, 2015b). It is also expected to incentivise investment in the storage technologies needed to support an increased share of renewables (Haas et al., 2013b). For the EC, a continued reliance on price volatility to ensure generators recover their fixed and variable costs is seemingly preferable to the creation of additional out-of-market support schemes (EC, 2015a). For instance, the Summer Package consultation asks, “While capacity mechanisms might be warranted under certain circumstances, they may be costly and distort the market… Could these [scarcity] prices make capacity mechanisms redundant?” (Ibid.). But increasing volatility creates significant challenges for investors and policymakers alike (Notenbloom et al., 2012; EC, 2011b; Edenhofer et al., 2013). Firstly, it will be extremely hard to model. The difficulty in accurately forecasting renewables generation and demand will create uncertainty over the timing and occurrence of peak pricing periods, which, in turn, increases investment risk (Ketterer, 2014; Notenbloom et al., 2012). In a personal interview conducted with Bloomberg New Energy Finance, Jonas Rooze summarised the central concern with this approach as follows: "You can probably make a short run marginal cost market work in ten years’ time. It’s just going to be very risky because you will depend on

volatility and you will depend on price spikes to get your return. …And if your returns depend on five of those, or ten of those, what happens if two don’t show up?” (Rooze, 2015). Greater price volatility also increases the likelihood of political intervention. Given the “political unacceptability of very high prices” (Auverlot et al., 2014), even in fully liberalised markets, caps are often imposed to protect consumers from extreme volatility and prevent market abuse and could therefore prevent prices from reaching the levels required (Green, 2008; NREL, 2013a). By relying upon volatility and scarcity pricing, the clear danger is that “a low and volatile electricity price might alter or delay investment decisions in new capacity …required for the transformation to a low-carbon energy system” (Ketterer, 2014). Demand response and dynamic pricing

The expansion of renewables will require changes to the way we consume electricity (Roberts, 2015). ‘Demand response’ and ‘dynamic pricing’ are two related concepts that concern the shifting of consumption patterns in response to real time price volatility. With greater distributed generation, consumers are expected to actively participate in electricity markets by selling their surplus generation back into the grid (Geelen et al., 2013). Such behaviour makes an important contribution by flattening the demand curve, reducing the volatility between peak and low demand by up to 30% and thereby reducing the level of peak generating capacity required (ECF, 2011a). The European Commission acknowledges that encouraging greater consumer participation will require retail prices to be more reflective of wholesale price variations (EC, 2015b). At present, “wholesale markets in many locations are markedly uncorrelated with pricing mechanisms in the retail market” (NREL, 2013a). Consumers are largely passive, demonstrating low elasticity to wholesale price movements for two main reasons (Dupont et al., 2014). Firstly, “most end-users do not observe real-time prices and hence cannot react to them” (Lijesen, 2007). Secondly, retail prices generally contain minimal differentiation, with ‘day’ and ‘night’ tariffs that do not reflect the actual price variations over a 24-hour period and therefore provide little incentive to shift consumption patterns (Dupont et al., 2014). The concepts of dynamic pricing and demand response were first envisioned over 35 years ago (Chao, 2010). Despite significant reductions in the cost of smart metering, smart grid and smart appliance technologies, the required social and behavioural changes mean that “price-responsive demand remains an elusive target” (Chao, 2010). Several European pilot studies have shown that the introduction of energy-efficient smart metering technology does not automatically produce the savings envisaged and that there are significant obstacles to overcome (Gronheit et al., 2011; Geelen et al., 2013). Firstly, the cost of making the technology available to a sizeable portion of the population is significant and further advances are needed to make the technology more user-friendly (Geelen et al., 2013). Secondly, not all consumers will be willing or able to change their consumption behaviour (Geelen et al., 2013). As Lijesen (2007) notes, large consumers actively participating in wholesale markets also demonstrate low-elasticity, even though they have greater real-time price visibility. Finally, as demand response generally tends to reduce retail revenues, there is little incentive for suppliers to make this widely available (Chao, 2010). It is difficult to reconcile the EC’s belief in dynamic pricing and demand response with its support for higher volatility and scarcity pricing. Historically, retail tariffs have adhered to

principles of transparency, simplicity and minimum volatility, partly due to the limitations of the available metering technology and partly to ensure social acceptability (Dupont et al., 2014). Without an appreciation of the underlying theory of marginal cost pricing, consumers may struggle to understand why electricity prices can be zero or even negative for extended periods, interspersed with short periods where prices may reach several thousand euros per kWh. Furthermore, dynamic pricing may offer financial incentives to reduce demand but this may not always be possible. Extremely high retail prices during times of scarcity could therefore be perceived as extortionate and morally questionable, for instance, the cost of a hospital’s air conditioning during a hot, cloudy day, or the cost to a business that can only operate during certain hours.

Capacity mechanisms and the return of long-term contracts If scarcity pricing represents an insufficient or unduly risky approach to ensuring system stability and cost recovery, then additional ‘out-of-market’ support will be needed to incentivise investment (NREL, 2013a). There are multiple variants but capacity mechanisms generally reward generators based upon their capacity to generate a certain amount of electricity, rather than the actual amount generated (NREL, 2013a; Green, 2008). Until recently, most European electricity markets operated without capacity payments (Green, 2008). Rising concerns over the ability of existing electricity markets to “keep the lights on” (Roques, 2014) have caused several EU member states to adopt or consider adopting capacity mechanisms (Bettzuge, 2014; Helm, 2014a; Edenhofer et al., 2013). For the EC, a fully integrated market will produce the required long-term investment signals, thereby reducing the need for capacity mechanisms (EC, 2015a). After two decades of reform aimed at liberalising electricity markets and removing national distortions, the European Commission is concerned that, if additional out-of-market incentives are introduced, they will create distortions that could undermine market integration (ECF, 2011a; EC, 2015a). Outside Europe, capacity mechanisms are more common, although the results of their adoption are not decisive and capacity payments can create other inefficiencies and disincentives (Green, 2008; Böckers et al., 2013). For instance, they can result in over capacities or the excessive expansion of certain technologies. They may also fail to stimulate or even discourage investment in the different types of capacity required (ECF, 2011a). If capacity mechanisms are being adopted on a national basis, neighbouring countries can benefit without having contributed towards the costs (Notenbloom et al., 2012). Helm (2014b) argues that a European-wide capacity market is needed to avoid creating national market distortions that would impede progress towards a fully integrated European electricity market. However, introducing capacity mechanisms departs from the market-only approach, as governments rather than markets must decide upon the required capacity margin, which technologies are eligible and how capacity mechanisms will interact with other support schemes (Helm, 2014a; Bettzuge, 2014; Edenhofer et al., 2013). An alternative to capacity mechanisms to create greater certainty for investors might be the reintroduction of long-term contracts (EC, 2015b; Haas et al., 2013a). Contracts could be awarded through a competitive auction, thereby mitigating concerns that they are antithetical to the liberalised, competitive market design, which undermines long-term contracts by promoting short-term switching (Roques, 2014; Auverlot et al., 2014). 1.1. Long-term marginal costs and the levelised cost of electricity

Whilst increased volatility, capacity mechanisms and dynamic pricing all implicitly assume the continuation of the short-term marginal cost pricing paradigm, one potential alternative mentioned within the literature concerns a shift towards long-term marginal costs, also known as the ‘Levelised Cost of Electricity’ (LCOE). For instance, Haas et al. (2013a) suggest that “pricing based on long-term marginal costs …[is] likely to become more prevalent than today”. The LCOE is calculated by determining the total fixed and variable costs of a power plant and dividing this by the total expected generation to produce a figure for every MWh generated. The principle objection with LCOE concerns the fact that the value of electricity varies according to the time and location of its production (Hirth, 2013; Edenhofer et al., 2013). Consequently, it is not considered a suitable means of comparing dissimilar technologies since it does not account for the other benefits different technologies provide to the grid, such as flexibility and dispatchability (IHS CERA, 2013; WRI, 2015). This criticism, however, focuses on LCOE as a means of comparing the ‘value for money’ of different technologies, rather than whether generators should bid their supply into the market at a level approximate to their long-term marginal costs. In theory, a new merit order could be devised based on long-term marginal costs but, as levelised costs are higher than short-term marginal costs, this approach may increase wholesale prices and therefore retail prices in the short term.

Conclusion The discussion has shown that the expansion of renewables is exacerbating deficiencies within current European electricity market design. The EU’s long-term energy and climate targets will require the near-total decarbonisation of the power sector and its future low-carbon electricity system is likely to have low or zero marginal costs. In a market based on marginal cost pricing, the expansion of renewables is causing wholesale prices to trend towards zero, thereby eradicating returns on investment in new generating capacity. To date, the discussion of potential reforms generally assumes the continuation of marginal cost pricing but for a system with low or zero marginal costs, such reforms may be untenable. Consequently, it may be necessary “to get rid of the simplified and anachronistic argument …that prices must equal short-term marginal costs” (Haas et al., 2013b). It is this paper’s contention that urgent attention should be given to designing a market that will work for a low or zero marginal cost system. Further research in this area will need to address several interesting questions such as (i) the likely impact of a new pricing paradigm on wholesale and retail prices; (ii) the level of renewables penetration at which the alternative paradigm will be needed; and (iii) how the market might transition towards the new paradigm as the share of conventional thermal generation declines. Under the current market design, paradoxically, the transition towards renewables is undermining the transition towards renewables. If the EU cannot design an electricity market suitable for a zero-carbon system, it is likely that the proposed reforms will become obsolete before they are fully implemented.

Bibliography Allcott, H., 2011. "Rethinking real-time electricity pricing". Resource and Energy Economics,

33(4), pp.820–842.

Auverlot et al., 2014. “The European electricity market at a crossroads” in: Monange, H. (ed.) The Crisis of the European Electricity System: Diagnosis and possible ways forward, Paris, Commissariat général à la stratégie et à la prospective, pp.17-44.

Bettzüge, 2014. “European electricity markets: policy deficiencies, design deficiencies, and opportunities for policymakers” in: Monange, H. (ed.) The Crisis of the European Electricity System: Diagnosis and possible ways forward, Paris, Commissariat général à la stratégie et à la prospective, pp.45-64.

Blesl et al., 2012. "Implications of different climate protection regimes for the EU-27 and its member states through 2050". Climate Policy, 12(3), pp.301–319.

Böckers et al., 2013. "The green game changer: An empirical assessment of the effects of wind and solar power on the merit order". DICE Discussion Paper (104), pp.1-32.

Castagneto-Gissey, 2014. "How competitive are EU electricity markets? An assessment of ETS Phase II". Energy Policy, 73, pp.278–297.

Chao, 2010. "Price-Responsive Demand Management for a Smart Grid World". The Electricity Journal, 23(1), pp.7–20.

Cossent et al., 2009. "Towards a future with large penetration of distributed generation: Is the current regulation of electricity distribution ready? Regulatory recommendations under a European perspective". Energy Policy, 37(3), pp.1145–1155.

Cossent et al., 2011. "Large-scale integration of renewable and distributed generation of electricity in Spain: Current situation and future needs". Energy Policy, 39(12), pp.8078–8087.

DeCanio & Fremstad, 2011. "Economic feasibility of the path to zero net carbon emissions". Energy Policy, 39(3), pp.1144–1153.

Dupont et al., 2014. "Demand response with locational dynamic pricing to support the integration of renewables". Energy Policy, 67, pp.344–354.

Edenhofer et al., 2013. "On the economics of renewable energy sources". Energy Economics, 40, pp.12–23.

EDF, 2015. "Technical and Economic analysis of the European Electricity System with 60% RES". [Online] Available at: http://www.energypost.eu/wp-content/uploads/2015/06/EDF-study-for-download-on-EP.pdf [Accessed 27 June 2015].

Elexon, 2013. "The Electricity Trading Arrangements: Beginners guide". [Online] Available at: https://www.elexon.co.uk/wp-content/uploads/2013/11/beginners_guide_to_trading_arrangements_v4.0_cgi.pdf [Accessed 14 July 2015].

EREC, 2010_REthinking 2050. "A 100 percent Renewable Energy Vision for the European Union". [Online] Available at: http://ec.europa.eu/clima/consultations/docs/0005/registered/91650013720-46_european_renewable_energy_council_en.pdf [Access 19 June 2015].

Eurelectric, 2011. "20 percent Renewables by 2020 - Renewable Energy Systems Action Plan 2011". [Online] Available at: http://www.eurelectric.org/media/26730/resap_report_20111026_high_quality-2011-133-0001-01-e.pdf [Accessed 13 June 2015].

Eurelectric, 2015. "Demand Response". [Online] Available at: http://www.eurelectric.org/media/176935/demand-response-brochure-11-05-final-lr-2015-2501-0002-01-e.pdf [Accessed 13 June 2015].

European Climate Foundation (ECF), 2011a. "Power Perspectives 2030 - On the road to a decarbonised power sector. [Online] Available at: http://www.roadmap2050.eu/attachments/files/PowerPerspectives2030_FullReport.pdf [Accessed 16 June 2015].

European Climate Foundation (ECF), 2011b. "Roadmaps to Reality_Briefing Note_Wholesale Power Markets" [Online] Available at: http://www.roadmap2050.eu/attachments/files/RoadmapstoReality_BriefingNote_WholesalePowerMarkets.pdf [Accessed 16 June 2015].

European Commission (EC), 2011a. "A Roadmap for moving to a competitive low carbon economy in 2050". [Online] Available at: http://eur-lex.europa.eu/resource.html?uri=cellar:5db26ecc-ba4e-4de2-ae08-dba649109d18.0002.03/DOC_1&format=PDF [Accessed 16 June 2015].

European Commission (EC), 2011b. "Energy roadmap 2050". [Online] Available at: https://ec.europa.eu/energy/sites/ener/files/documents/2012_energy_roadmap_2050_en_0.pdf [Accessed 16 June 2015].

European Commission (EC), 2012. "Renewable Energy- a major player in the European energy market". [Online] Available at: http://eur-lex.europa.eu/legal-content/EN/TXT/PDF/?uri=CELEX:52012DC0271&from=EN [Accessed 16 June 2015].

European Commission (EC), 2013. "EU Energy, Transport and GHG Emissions_Trends to 2050". [Online] Available at: http://ec.europa.eu/transport/media/publications/doc/trends-to-2050-update-2013.pdf [Accessed 16 June 2015].

European Commission (EC), 2014a. "2030 Climate and Energy Policy Framework". [Online] Available at: http://www.consilium.europa.eu/uedocs/cms_data/docs/pressdata/en/ec/145397.pdf [Accessed 16 June 2015].

European Commission (EC), 2014b. "Energy Economic Developments in Europe". [Online] Available at: http://ec.europa.eu/economy_finance/publications/european_economy/2014/pdf/ee1_en.pdf [Accessed 16 June 2015].

European Commission (EC), 2014c. "Energy prices and costs in Europe". [Online] Available at: https://ec.europa.eu/energy/sites/ener/files/documents/20140122_communication_energy_prices.pdf [Accessed 16 June 2015].

European Commission (EC), 2014d. "Support to the review of Directive 2009-31-EC on the geological storage of carbon dioxide". [Online] Available at: http://www.ccs-directive-

evaluation.eu/assets/CCS-Directive-evaluation-Final-Report.pdf [Accessed 16 June 2015].

European Commission (EC), 2015a. "Energy Union Package". [Online] Available at: http://eur-lex.europa.eu/resource.html?uri=cellar:1bd46c90-bdd4-11e4-bbe1-01aa75ed71a1.0001.03/DOC_1&format=PDF [Accessed 16 July 2015].

European Commission (EC), 2015b. "Launching the public consultation process on a new energy market design". [Online] Available at: http://ec.europa.eu/energy/sites/ener/files/documents/1_EN_ACT_part1_v11.pdf [Accessed 16 July 2015].

Eurostat, 2013. Renewables electricity production. [Online] Available at: http://ec.europa.eu/eurostat/statistics-explained/index.php/File:RENEWABLES-ELECTRICITY-PRODUCTION-2013.png [Accessed 28 July 2015].

Fanone et al., 2013. "The case of negative day-ahead electricity prices". Energy Economics, 35, pp.22–34.

Friends of the Earth (FOTE), 2014. "Big six on the run: How renewables are disrupting big energy firms everywhere". [Online] Available at: http://www.foe.co.uk/sites/default/files/downloads/big-six-run-74362.pdf [Accessed 16 July 2015].

Frydenberg et al., 2014. "Long‐term relationships between electricity and oil, gas and coal future prices—evidence from Nordic countries, Continental Europe and the United Kingdom". OPEC Energy Review 38(2), pp.216-242.

Geelen et al., 2013. "Empowering the end-user in smart grids: Recommendations for the design of products and services". Energy Policy, 61, pp.151–161.

Goodall, 2015. "Will the Californian Duck make it to Britain in summer 2015?". Carbon commentary. [Online] Available at: http://www.carboncommentary.com/blog/2015/2/25/3oy6j0ourtc6ugqi0ym52b8275shcg [Accessed 24 June 2015].

Green, 2008. "Electricity wholesale markets: Designs now in a low-carbon future". Energy Journal, 29, pp.95–124.

Grohnheit et al., 2011. "Area price and demand response in a market with 25% wind power". Energy Policy, 39(12), pp.8051–8061.

Haas et al., 2013a. “The growing impact of renewable energy in European electricity markets” in. Sioshansi, F. (ed.) Evolution of Global Electricity Markets: New paradigms, new challenges, new approaches. Saint Louis, Academic Press

Haas et al., 2013b. "The looming revolution: How photovoltaics will change electricity markets in Europe fundamentally". Energy, 57, pp.38–43.

Hall, P.J., 2008. "Energy storage: The route to liberation from the fossil fuel economy?" Energy Policy, 36(12), pp.4363–4367.

Helm, 2014a. "The European framework for energy and climate policies". Energy Policy, 64, pp.29–35.

Helm, 2014b. “The current situation and mid-term prospects for European

electricity markets” in: Monange, H. (ed.) The Crisis of the European Electricity System: Diagnosis and possible ways forward, Paris, Commissariat général à la stratégie et à la prospective, pp.65-76.

Hirth, 2013. "The market value of variable renewables. The effect of solar wind power variability on their relative price". Energy Economics, 38, pp.218–236.

IHS CERA, 2013. "Bridging the Missing Money Gap: Solutions for competitive power cash flow shortfalls". [Online] Available at: https://www.ihs.com/pdf/Bridging-Missing-Money-6440-0814AW-2_168383110913044932.pdf [Accessed 16 June 2015].

Institute for European Environmental Poliy (IEEP), 2014. "The European Commission's proposed 2030 Climate and Energy Framework" [Online] Available at: http://www.ieep.eu/assets/1322/IEEP_Background_Paper_on_2030.pdf [Accessed 14 July 2015].

International Energy Agency (IEA), 2013. "World Energy Outlook Special Report-Redrawing the Energy-Climate Map". [Online] Available at: http://www.iea.org/publications/freepublications/publication/weo_special_report_2013_redrawing_the_energy_climate_map.pdf [Accessed 08 June 2015].

International Energy Agency (IEA) 2014. "Energy Policies of IEA Countries - European Union 2014 Review". [Online] Available at: https://www.iea.org/Textbase/npsum/EU2014SUM.pdf [Accessed 08 June 2015].

International Energy Agency (IEA), 2015. "Energy and Climate Change - World Energy Outlook - Special Report". [Online] Available at: https://www.iea.org/publications/freepublications/publication/WEO2015SpecialReportonEnergyandClimateChange.pdf [Accessed 12 June 2015].

Jacobson & Delucchi, 2011. "Providing all global energy with wind, water, and solar power, Part I: Technologies, energy resources, quantities and areas of infrastructure, and materials". Energy Policy, 39(3), pp.1154–1169.

Jägemann et al., 2013. "Decarbonizing Europe’s power sector by 2050 - Analyzing the economic implications of alternative decarbonization pathways". Energy Economics, 40, pp.622–636.

Kessides, 2012. "The future of the nuclear industry reconsidered: Risks, uncertainties, and continued promise". Energy Policy, 48, pp.185–208.

Ketterer, 2014. "The impact of wind power generation on the electricity price in Germany". Energy Economics, 44, pp.270–280.

Lijesen, 2007. "The real-time price elasticity of electricity". Energy Economics, 29(2), pp.249–258.

Mez, 2012. "Nuclear energy-Any solution for sustainability and climate protection?" Energy Policy, 48, pp.56–63.

National Renewable Energy Laboratory (NREL), 2012. "Integrating Variable Renewable Energy in Electric Power Markets". [Online] Available at: http://www.nrel.gov/docs/fy12osti/53732.pdf [Accessed 26 June 2015].

National Renewable Energy Laboratory (NREL), 2013a. "Market Evolution: Wholesale Electricity Market Design for 21st Century Power Systems". [Online] Available at: http://www.nrel.gov/docs/fy14osti/57477.pdf [Accessed 19 June 2015].

National Renewable Energy Laboratory (NREL), 2013b. "Wind and Solar curtailment". [Online] Available at: http://www.nrel.gov/docs/fy13osti/60245.pdf [Accessed 14 June 2015].

National Renewable Energy Laboratory (NREL), 2014 "Flexibility in 21st Century Power Systems". [Online] Available at: http://www.nrel.gov/docs/fy14osti/61721.pdf [Accessed 18 July 2015].

Notenboom, et al., 2012. "Climate and energy roadmaps towards 2050 in north-western Europe". [Online] Available at: http://www.pbl.nl/en/publications/2012/climate-and-energy-roadmaps-towards-2050-in-north-western-europe. [Accessed 17 June 2015].

Odenberger et al., 2013. "Prospects for CCS in the EU Energy Roadmap to 2050". Energy Procedia, 37, pp.7573–7581.

Paraschiv et al., 2014. "The impact of renewable energies on EEX day-ahead electricity prices". Energy Policy, 73, pp.196–210.

PriceWaterhouse Coopers (PWC), 2011. “Moving towards 100% Renewables in Europe and North Africa by 2050”. [Online] Available at: https://www.pwc.com/en_GX/gx/sustainability/research-insights/assets/renewable-electricity-2050.pdf [Accessed 25 August 2015]

Reid, 2015. "Renewables and the missing money problem". Energy and Carbon Blog. [Online] Available from: http://energyandcarbon.com/renewables-and-the-missing-money-problem/ [Accessed 12 July 2015].

Roberts, 2015. "Why wind and solar power are such a challenge for energy grids". Vox. [Online] Available at: http://www.vox.com/2015/6/19/8808545/wind-solar-grid-integration [Accessed 10 July 2015].

Rooze, J., 2015. Interviewed by: Sedgwick, M. (24 June 2015). Roques, 2014. “European electricity markets in crisis: diagnostic and way forward” in:

Monange, H. (ed.) The Crisis of the European Electricity System: Diagnosis and possible ways forward, Paris, Commissariat général à la stratégie et à la prospective, pp.77-117.

Rübbelke & Vögele, 2011. "Impacts of climate change on European critical infrastructures: The case of the power sector". Environmental Science & Policy, 14(1), pp.53–63.

Schiermeier, 2014. "EU climate targets under fire". Nature, 505(7485), pp.597.

Schleicher-Tappeser, 2012. "How renewables will change electricity markets in the next five years". Energy Policy, 48, pp.64–75.

Scott, 2013. "What can we expect from Europe’s carbon capture and storage demonstrations?" Energy Policy, 54, pp.66–71.

Sioshansi, 2014. "European Electricity Prices Rising, Diverging among Member States". The Electricity Journal, 27(4), pp.1–3.

The Climate Group (TCG), 2014. "40% EU climate target must be seen as floor to increased ambition, says Mark Kenber, CEO, The Climate Group". [Online] Available at: http://www.theclimategroup.org/what-we-do/news-and-blogs/40-eu-climate-target-must-be-seen-as-a-floor-to-increased-ambition-says-mark-kenber-ceo-the-climate-group/ [Accessed 16 June 2015].

The Economist, 2013. "How to lose half a trillion euros". [Online] Available at: http://www.economist.com/news/briefing/21587782-europes-electricity-providers-face-existential-threat-how-lose-half-trillion-euros [Accessed 20 June 2015].

Trembath, 2015. "A Look at Wind and Solar: Part 2 - Is there an upper limit to intermittent renewables?". The Breakthrough. [Online] Available at: http://thebreakthrough.org/index.php/voices/energetics/a-look-at-wind-and-solar-part-2 [Accessed 19 June 2015].

Umbach, 2011. "The Future of Coal, Clean Coal Technologies and CCS in the EU and Central East European Countries: Strategic Challenges and Perspectives", EUCERS Strategy Paper. [Online] Available from: https://www.kcl.ac.uk/sspp/departments/warstudies/research/groups/eucers/strategy-paper-2.pdf [Accessed 17 June 2015].

Wade et al., 2010. "Evaluating the benefits of an electrical energy storage system in a future smart grid". Energy Policy, 38(11), pp.7180–7188.

World Energy Council (WEC), 2013. "World Energy Scenarios: Composing energy futures to 2050". [Online] Available at: https://www.worldenergy.org/wp-content/uploads/2013/09/World-Energy-Scenarios_Composing-energy-futures-to-2050_Full-report.pdf [Accessed 10 June 2015].

World Resources Institute (WRI), 2012. "GHG Mitigation in the EU: An overview of the current policy landscape". [Online] Available at: http://www.wri.org/sites/default/files/pdf/ghg_mitigation_eu_policy_landscape.pdf [Accessed 22 June 2015].

World Resources Institute (WRI), 2015. "Utility scale renewable energy: Understanding cost parity". [Online] Available at: http://www.wri.org/sites/default/files/WRI14_Factsheets_Utility_Scale_v4.pdf [Accessed 22 June 2015].

International Financial Investment and Risk: Concepts, Challenges and Costs of an Imperfect Approach to Political Risk

Mehdi Bchir

Abstract This paper questions the appropriateness of the analytical approach used by financial investors for assessing political risk. In the process, it explores the various definitions and concepts of political risk and critically evaluates how the financial investment industry understands, assesses and manages risk. It argues that an incoherent approach to political risk, in a world where most significant barriers have been removed on all financial activities, has a significant impact in instigating capital flows to move from poor economies to safer and richer ones increasing the vulnerability of developing economies. The argument is supported by solid examples that illustrate how an inconsistent approach to political risk leaves the developing world with a restricted access to capital as well as other budgetary restrictions preventing it from achieving its developmental goals in order to attract capital and achieve further growth.

Introduction This paper argues that the current political risk assessment methodology employed by financial investors is inconsistent and detrimental to the allocational efficiency of capital and to growth in the developing world. In the absence of a standardized method for analysing risk, inclusive of a coherent approach to political risk, capital movement becomes highly volatile and leads markets to behave irrationally. Markets tend to underreact with the early signs of crisis and to overact to the end of crisis assuming it is over. This poses a significant obstacle for developing countries to attract capital, and reduces their capacity to formulate robust national budgets in line with their developmental needs. To give the reader a better understanding of the central thesis put forward, this paper begins by highlighting the growing struggle for developing countries to attract lasting and tangible investments. The paper begins by examining the current features of globalisation, which, despite the considerable growth of international trade and FDI, both remain insignificant when compared to the monumental growth of international finance. Capital movement has been almost completely liberalised, while barriers continue to hinder free market trade structures, leading to the radical prominence of portfolio investments in contrast to diminishing FDI. Though FDI offers the opportunity for concrete and durable developments, it requires investors to invest in the slow process of building infrastructure and expect comparatively low returns. In the case of political instability, portfolio investment offers investors a certain degree of safety in the ease of pulling out as well as instant returns as a result of modern technology. Speculations nonetheless, often ravage developing economies when investors pull out, causing lowered exchange rates, a depreciated currency and less total wealth. In section two of this paper defines political risk. It addresses a series of questions regarding the nature and effect of political risk on firms. This paper finds that political risk has different definitions and expressions, and the way it affects the firm’s decision are manifold and complex. In section three, this paper explores the three categories of risk the financial industry is concerned with. The first approach is statistical and considers the best way to evaluate uncertainty is to study its past movement of the asset. The second approach is analytical and refers to the practice of forecast and evaluation of potential risks compromising the investor’s objective to achieve profitability. This paper exhibits how these two approaches are employed in commodity and government bond trading. This paper finds that investment decision making is largely dependent on the interpretation of political risk through metrics such as historic and implied volatilities, which are essentially a reflection of the “the Markets’” perception of danger and anticipation of uncertainties. Political risk is not approached through a rational and coherent analysis of the political climate based on a social scientific approach, which leaves the assessment task incomplete and inaccurate. With Government bonds risk is concerned with the credit worthiness of the counterparty. This paper noted that in addition to market variables such as CDS premiums (credit default swaps), bond yields and asset liquidity indexes, a large part of political risk is assessed through sovereign credit ratings. However, the usefulness and accuracy of credit ratings have been under increased criticism: as credit Rating agencies are accused of being too slow to change ratings and pro-cyclical. A number of crises such as Mexican crisis in 1994-95 produced the sentiment that rating agencies react to events rather than anticipate them.

Throughout this paper we discuss the limitations of each approach on the basis of empirical examples supporting the inconsistencies of the risk measures and their negative impact on market behaviour. This paper also discusses Ian Bremmers’ concept of the J curve, in which he provides an alternative approach to understanding risk by describing the relationship between a country’s openness and its stability.

This paper concludes that the volatile nature of capital movement and persisting political instabilities in developing countries (often as a consequence of diminishing growth), enforce the cycle of regressive development in which capital flows towards low risk investments largely located in advanced economies, leaving developing economies with an access to capital constrained to financial markets. A refined methodology for assessing political risk can significantly contribute to the finding of a new scope of investment opportunities inclusive of developing countries. This is in addition to achieving lower capital movement volatility, price stability and an enhanced geographical mobility to areas inclusive of developing economies.

Globalisation Studying the core economic features of the current phase of globalisation can help us understand its continued effect on trade and capital flows with respect to growth in developing countries.

Globalisation in the 20th century enabled a vast expansion of the global market place, opening up vast markets for global trade and foreign direct investment: The international trading regime established in 1944 at Bretton Woods, made possible the unprecedented expansion of output and trade. Labour and capital intensive industries witnessed unprecedented developments as world exports increased from $61bn in 1950 to $3,447bn in 1990’s representing respectively 6% and 16% of world GDP (Nayyar 2006 :137). By the end of the 1980s TNCs were responsible for more than half of all the worlds manufacture, and three quarters of all trade in services. Stock of FDI also continued to increase from $68bn in 1960 to $1,948bn in 1992 while flows of FDI increased from less than $5bn in 1980 to $171bn just a decade later(Nayyar 2006:137).

However, by the end of the 1980s, growth of international financial markets had gone well beyond the accommodation of trade: deregulation and technology development have resulted in the elimination of most significant barriers in all kind of financial activity, while it continued to hinder market trade structures. Banks and financial investors greatly expanded their presence in other countries through branches and subsidiaries. Net international bank loans rose from 0.7% of world output in 1964 to a staggering 16.3% in 1991. Foreign exchange markets grew from a modest $15bn per day in the seventies to over $900bn in the nineties. Government debt became tradable in the global market of financial assets, and bond issue grew at about three times the rate of world output between 1973 and 1995. Total bond purchases rose from $7.5bn in 1970s to nearly $50 Trillion in 1996, and the volume of derivatives expanded astronomically to a total value of 321 trillion in 1996, which is more than world GDP (World Bank2004).

Nonetheless, while both FDI and portfolio investments are plausible choices for investors, they have different characteristics in terms of risk-return and opposite effects on the potential growth for the recipient country. As a result of modern technology, portfolio investment offered the possibility of instant returns as well as the safety and flexibility in the ease of pulling out of markets at the first sign of trouble. FDI however, implies a controlling stake in a business and often connotes with capacity building and ownership of physical assets. It is

therefore more difficult to pull out in case of trouble, and returns are comparatively lower and slower. This led to a shift of capital from commercial and long term investments to portfolio investment resulting in a tremendous growth of finance at the expense of a decline in FDI. As Chomsky noted “in 1971, 90% of international financial transactions concerned the real economy – either commercial or long term investments – and 10% were speculative. In 1990, the percentages were turned upside down …with daily reserves in foreign currency higher than the reserves of the seven major industrial powers” (Smulders 2008: 5)

The drive for instant returns and safety in an era of floating exchange rates brought with it a sharp rise in flows of speculative capital (Hot Money), while the rapid shift of money flows from one country to another jeopardized the effectiveness of any type of economic policy and raised serious problems affecting economic stability.

In the face of the lack of resources for investments consistent with developmental needs of their vulnerable economies, developing countries maintained protectionist policies to avoid the devastating consequences of capital flight. However, with low levels of growth, and persisting political instabilities (often as a direct consequence) capital owners are discouraged from investing, and in the absence of barriers, capital flows tended to move from poor economies to safer and richer ones. For the developing world, this meant that attracting large amounts of capital became evidently restricted to bond markets, and to appeal to global investors, they have also became at the mercy of credit rating agencies and risk analysts who due to the growing need of bond issuance, were invited to assess their quality. So while the process of globalisation has brought the world innumerable improvements and economic opportunities, it failed to optimise capital allocation, achieve uniform growth distribution and reduce economic disparities. The lack of tangible and lasting investments continues to accentuate political instabilities. This in turn continues to dissuade capital owners away, and engages developing countries into a vicious cycle of regressive development, where they are neither capable to grow nor able to attract the resources needed to grow.

Defining Political Risk Political risk for portfolio investment shares many of the characteristics of risk for FDI. Because it strides across numerous disciplines, there are alternative definitions that have been attached to the term over time. Studying them is important in identifying the methodological distinction between the actuarial and social sciences.

For economists and analysts of international business concerned with issues of trade, financial investments and activities of multinational enterprises, political risk stems from sources that affect factors central to the performance of a firm, such as the fiscal, monetary, trade, investment, labour and developmental policies of the host country, impacting the viability of an investment. Risk and risk exposure are assessed on the basis of their effect on the activities of the firm. However, different definitions find different origins to risk: for David Schmidt political risk is “the probability or disruption of the operations of MNEs by political forces and events” (Gelis-Filho: 4). Risk here is understood as a change in political parameters; through the activities of governments or their agencies; whose decisions may result in ramifications likely to distort or adversely affect the interests of economic stake holders. Although broad, this definition is important as it highlights the forward-looking nature of political risk analysis by considering risk in terms of probability of events rather than just an event. Other definitions view political risk as the unwanted government interference with business operations (Sottilotta 2013:3). Political risks here is understood to be in the application of

host government policies that constrain the business operations of a given foreign investment. Although factual, this view is restrictive as it has normative implications; as noted by Korbin; and assumes that government intervention is necessarily harmful. Whether host governments and companies have diverging objectives is not always true, and similar preconceptions may be detrimental to the consistency of the produced risk analysis.

Korbin provides a broader account of political risk by expanding his focus to the wider operating environment rather than focusing on the firm itself. He defines political risk as “the possibility that political decisions or events in a country will affect the business climate in such a way that investors will lose money or not make as much money as they expect when the money is made” (Brink 2004:176). Ramifications to the firms’ objectives in this approach may be subject to distortions sourced in a wider spectrum of risks. It implies that the viability and profitability of an investment can be adversely impacted through both market and non-market events that affect the micro-economic as well as the macro- political climate. Political risk analysis is therefore an effort to project circumstances under which harm occurs to the investor by political decisions. The purpose of making such projections is to prepare investors to deal with such risks. For scholars concerned with developmental politics and international relations, the definition of political risk tends to rest with the exercise of power and the harm that can stem from this to international system, nation-states and populations. Consequently, Political risk represents any threat to the peaceful coexistence between states, revolutions, civil war and state-failure. On an international level a lesser acute form of political risk is generally associated to diplomatic hostility, cold wars and trade wars, while domestically this would be more in the form of civil disobedience, low government legitimacy and poor levels of public integrity.

Thus, for political scientists political risk is more often read as a “non-economic risk” rooted in political instability (Ciarrapico 1992: 127). It is understood to include all factors and processes that hinder or constraint in particular the operations of political institutions, the exercises of legitimate rule and the functioning of domestic civil society rather than the firm related activities. On this reading, political risk is primarily a function of government activity, which may result in an outcome that may adversely affect the interests of both economic and non-economic stakeholders. Another important feature of political risk is highlighted by Fitzpatrick as he argues that “while certain events come as a surprise, political risk is a process rather than a sudden event”(Fitzpatrick 1993: 249). This view is shared by Robock who claims that risk is not static and can change over time (Robock 1971: 6). Sethi and Luther concur and argue that political risk is “a gradual event such as ideological changes” (Sethi 1983: 57) which implies that the collective impact of events smaller than major political changes as a result of elections, revolts or wars, should not be ignored. In fact, this is the type of risk which firms and banks could not classify as mere business risk and evaluate by looking at the economic fundamentals of a country. Accordingly, instability in this approach is established in concerns over the political system, institutional stability, policy continuity and change, governance, transparency and geopolitics.

Financial Investment and Risk Financial investment industry is concerned with three main aspects of risk: Market Risk, as a result of modernisation and progress of the banking sector, investors face risks such as fluctuations in interest rates, foreign exchange, commodity and other market variables. Credit Risk also known as default risk which checks the inability of an industry or counter-party to

meet the commitments of making settlement of financial transactions. And finally operational risk which refers to issues of settlement of payments and the interruption of business activities in a specific market.

Assessment techniques for risk are numerous. Traditional methods range from a comparative approach of rating and mapping to analytical techniques of probability determination to the econometric techniques of risk modelling. In this section, this paper examines how risk is approached throughout the decision making process. This paper focuses on the study commodity options and government bonds due to their particular sensitivity to political risk and their relevance to the structure of developing economies.

Commodity trading and risk

Faced with countless events and situations that may arise in the future, the main driving force for risk assessment is the idea to derive methods of forecasting financial prices, which applied on financial markets, could result in significant returns. In commodities trading, a modern method for the evaluation of political risk applies option pricing techniques (Clarck et al 2000: 5). Based on complex mathematics, pricing models estimate the current value of an asset built on macro and micro-economic inputs. The most popular model is based on a formula called the Black-Scholes formula and was considered as “one of the biggest breakthroughs in the history of theoretical finance” (Harford 2012).

Risk modelling is based on two main approaches: statistical and analytical approaches, which are applied in all stages of investment planning, to assess the attractiveness of the asset and to monitor the potential losses which may result as a consequence of holding it. The statistical approach stems from actuarial and financial sciences, which considers the best way to evaluate uncertainty for a given asset, is to study its past movements. This approach can be traced back to the famous work of Louis de Bachelier’s theory of speculation, in which he argued that under the assumption that markets are efficient, markets are also unpredictable considering the countless factors which are likely to influence an investor’s decision (ESSL 2009: 11). The method argues that a study of the historical performance of a given asset provides a valuable insight on the assets’ behaviour when obstacles are encountered. Based on the historical price of the asset, the statistical approach measures the change in the value of a security over time and expresses it in a metric called historic volatility. In other words, it establishes a measure of the reactivity of a security to a shock. A higher volatility implies that the security is unstable and that its price can change dramatically over a short period of time in either direction; whereas a lower volatility suggests the value of an asset is rather stable. Although this approach tells us very little about moves of a security, it is useful to correlate price change to shock intensity. The second approach is analytical and refers to the practice of forecast and evaluation of potential risks, and allows the taking of some corrective measures to minimize potential losses. In order to curb exposure to risk, uncertainty is addressed by generating metrics measuring the possibilities of encountering perils, compromising its capacity from achieving profits. These risks are called vulnerabilities and are quantified on the basis of their probability, frequency, intensity and potential impact on an objective. One of the most critical metrics produced by this approach is called implied volatility (IV). In contrast with historical volatility, IV is a forward-looking and subjective measure which shows what the market “implies” about the assets’ volatility or potential moves in the future. It represents one of six inputs used in an options pricing model, but it is the only one that is not observable in the market itself and can only be determined by knowing the other five variables.

In commodity trading, risk for investors is that if they buy a commodity today, the price can drop in the future and you could lose money. In order to avoid huge losses a large part of risk is eliminated through the simple act of trading option contracts instead of purchasing physical stocks of commodities. There are two main kinds of option contracts: a put option gives its buyer the right to sell a commodity, and call options which confer the right to sell. An option gives you the right to wait and buy or sell the commodity if it reaches some agreed price in the future. But there is no obligation since if the commodity fails to reach that price, the investor can opt out and would only lose the cost of the option. By knowing the correct value of a derivative, investors are able to define the profitability of the derivative by knowing if it could be sold at higher price, or if it matures with a higher value than predicted.

The challenge that arises with option trading is how much should someone pay for the option for absolute peace of mind. In the absence of a standardized way to price options, it is hard for investors to define the correct value of a derivative. The Black-Scholes pricing formula is very complex; however, it is not hard to conceptually understand what determines the price of a commodity option. The formula prices an option on the basis of a number of variables we distinguish in two categories: The fixed variables, such as the market price of the underlying security (physical commodity), the strike price at which the option can be exercised, the time left to the expiration of the option and risk-free interest rates.

We also find user-definable variables such as implied volatility, which as discussed above, represents the estimation of the volatility during the life of the option. Implied volatility is the most important input in pricing models, because unlike interest rates and dividend rates it is a theoretical value. Everything else being equal a higher volatility will mean a higher option price. It can be thought of as the “Price/Earnings ratio of options” as it changes with the levels of supply and demand. Similar to stocks, when the demand shifts due to uncertainty, the price of that option changes according to the trend and helps investors gauge how much of an impact news may have on the underlying security.

Financial investors use the volatility as a proxy for political risk, because it is a variable that is very susceptible to traders’ or the markets’ sentiments about the business environment. For instance, it rises when traders are worried about risk and falls when investors are extremely confident. A number of studies noted a positive relationship between political risk, news and volatility (Beaulieu et al 2002: 4). It has been evidenced in the work of Erb, Harvey and Viskanta, who found a significant relationship between political risk indicators and market volatility in emerging markets (Erb et al 1996: 46). Therefore, being able to forecast volatility with a high degree of accuracy is crucial for option traders.

Yet measuring the value of implied volatility does not rely on objective rules, but rather on market indicators which it uses as guidelines. One of the methods used to gauge implied volatility is to compare historical volatility to past implied volatility. This approach is based on the premise that there is generally a “normal” level of volatility that an option would have over time. Therefore, the commodity’s volatility has an average it tends to trade at and it will tend to be “mean reverting”, which means it will always tend to go back to its average. Although this assumption is common in financial theory, it is often false for real markets (Stewart 2012). This raises important questions over the consistency of the measure of volatility and its reliability as a proxy for political risks. There are three important limitations to this approach: Because implied volatility is a reflection the “markets’” perception of risk, it cannot be considered as an accurate proxy to assess political risk. This is because expert and public perceptions of risk are rarely equal. The reasons for such disagreements can be assigned to the publics’ lack of experimental data and

incomplete theoretical understanding of the mechanisms and implications behind politics and risk (Sjoberg 1993: 3). People are not as well informed as political scientists, and sciences are certainly superior to everyday life knowledge as they build upon systematic empirical evidence and organise it in cumulative theoretical structures which are subjected to argumentative testing. In fact, a number of studies noted a “social amplification of risk”, in which events thought to be of minor risks by technical experts, often produced strong public concerns and resulted in substantial impact on the economy (Kasperson et al 2006: 181).

An example of this can be seen in the Middle East, where recent political struggles in Tunisia, Egypt, Libya and Syria led to large fluctuation in oil prices and sent the Brent crude price to a two-year high (El-Katiri 2014). Investors feared that major oil producing countries in the Gulf region, and Algeria would be destabilised by political unrest significantly constricting oil production. The risk of spread of violence raised investors’ concerns on key oil transits routes such as the Suez Canal, which they feared they would be disrupted by the instabilities in Egypt. Therefore, expectations that the uprisings would significantly impact the market in a negative way caused a significant rise in volatility and oil prices. Yet from an expert point of view, the reality is that the levels of political violence in the Gulf at the time were lower than in Egypt, Libya and Syria. In fact, the only oil producing country that suffered the most notable disruption was Libya. But Libya only supplied a minor amount of the global oil supply, while Syria, Egypt, Yemen and other Arab countries are not major oil producers of any note. Additionally, the more favourable socio-economic conditions in the Gulf States combined with their governments capacity to engage in massive public spending drives to quieten any potential protests, meant that the Arab spring did not pose a real threat to global production as price fluctuations suggested. Furthermore, the risk posed to the Suez Canal during Egypt’s revolution was overstated, since the Egyptian military; aware of the canals’ vitality to national interest; maintained its strength throughout and reserved troop capacity to prevent any serious interference at Suez (Apps 2013).

A similar situation, where perceived risk led to an uptick in oil prices, can be seen in relation to Iran’s threats in 2012 to close the straits of Hormuz, through which 17 million barrels of oil pass per day (Katzman et al 2012: 13). What public perception failed to capture is that although Tehran’s intimidation attempts contributed to a significant rise in oil prices, it was never likely to impose a blockade due to the damage it would cause to its own economy and relations with its limited regional allies. So the difference in perceptions is that states are not recognised; as in political sciences; as rational actors guided by national interest. Therefore, while today the signs of a possible softening of US-Iranian relations are confirmed, the region’s reputation for instability will be maintained. This is due to the primary public perception that the region is predisposed to wars, coups, terrorism and civil disturbance in ways that can definitely disrupt production of the lifeblood of the global economy. Therefore prices will remain volatile as long as the Middle East remains a centre for global oil production. Secondly, it is important to note that the accuracy of the volatility measure is influenced by the “herd instinct” which highly characterises speculative financial markets (Cont. et al 2000: 170). This has been documented by a number of studies which noted evidence of herding in the behaviour of fund managers who tend to make decisions without adequate information and appreciation of risk-reward trade-offs. The absence of a coherent and reliable analysis of political risk drives investors to flee to safer havens at the first sign of trouble. Others opt to imitate the trading practices of those they imply to be better informed rather than acting upon their own beliefs and private information. The results of the study confirm that herding has a

direct linear impact on market variables, and concludes that this has a strong impact on volatility and price variability (Natividad et al 2009: 11). Because the accuracy of volatility is compromised by herd trading, it cannot be considered as a valid proxy for political risk. Pricing models consequently do not represent reality adequately and are only functional during normal stable times.

Thirdly, the practice of dynamic hedging in commodity trading, where investors hedge their bets by betting in opposite directions, is an acknowledgement of the lack of reliability of the volatility measure. It is also a clear illustration of how the financial industry opts to work around a rational and scientific understanding of political risk by favouring ways the use of methods for making it less significant. Hedging is supposedly used to eliminate uncertainty of the movements in the price of a security, through the combination of two trades or investments with opposing behavioural patterns. There again complex algebra and calculations are used to match trades with opposing risk features. However, in the absence of a solid approach to political risk, even hedging is yet to be perfected as the method proved ineffective in the occurrence of major distortion to market dynamics. During events such as the 1997 property collapse in Thailand sparking a widespread panic across Asia, or political events such as the 1998 self-declared default of Russia refusing to pay all its international debt, risk models were unable to neither predict nor eliminate risk. That is because large fluctuations in the market are far more common than model can predict. Since risk models are calibrated on the basis of historical data, they usually only depict effects that have occurred in the past and not any unusual event that are not contained in that data, limiting their capacity to detect instabilities.

The macroeconomic impact of changing commodity prices has a tremendous effect on key determinants of economic growth: While oil price increases may be perceived positively by oil exporting countries, importing countries face uncertainties over import costs and fuel subsidies level. Oil price shocks can be transmitted into the macro-economy through a restriction of output due to increasing production costs affecting employment, trade, balance, exchange rates and public accounts. This is a particularly profound problem in the budget constrained and structurally vulnerable developing economies. Programs such as the oil subsidy systems to protect the local economy and households against price volatility become extremely costly and expose governments to significant budgetary risks. This often results in disincentives for energy efficiency and costly reallocations of budgetary resources from education, health and other investments essential to development. In 2011 as a result of oil price increase, Malawi suffered an important fuel shortage crisis. This shortage was mainly owed to the lack of foreign exchange which is mostly derived from tobacco export earnings. This in turn caused a reduction in tobacco output, leading to a drop in revenues and an increase in unemployment (Richardson 2012).

This extends to food commodity prices: whether the surge in food price is a result of investors’ anxiety over the supply capacity of producing countries, or as a direct consequence of rises in oil prices, it has a significant and direct fiscal impact where food subsidies are an important part of the budget. A higher level of subsidies can reduce funds available for the modernisation of the agricultural sector. And since poor people spend a large majority of their income on food, and farmers to produce food, changes in food prices will have large effects on the welfare of both farmers and poorer consumers.

Government Securities trading and risk

With government bond trading, investors are concerned with 5 main aspects of risks: (1) Default risk, where the borrower will not be able to pay back the principle or make interest payments. (2) Interest rate risk, associated to the fall in value of bond prices due to rising interest rates. (3) Liquidity risk as in lack of marketability of a bond which cannot be bought or sold quickly to prevent financial losses. Finally, (4) inflation risk: since inflation devalues money, future interest paid out to bond holders will also be worth less, as well as raise interest rates which devalue bonds. The price of a bond can fluctuate due to many factors; the most important being interest rate sensitivity. As interest rates change, the present values of future cash flows change, affecting the market price of a bond. Accordingly, factors that affect risk range from borrower specific criteria such as political stability, government policies, and debt ratios, to market wide considerations such as economic growth.

Form an investors’ perspective, the question whether a country is financially healthy has major implications on default and liquidity risk levels. Equally important, whether a country is exposed to the risk of conflict and instabilities has significant implications for the prospective yields on bonds, equities and currencies. Political events, therefore, highly matter to financial markets on sovereign debt. Because a government bond is a fixed income asset, it provides its holders a fixed stream of income. Unlike derivative options, pricing it is quite simple and does not represent a crucial step in the assessment of the asset.

Political risk proxies Based on the efficient market hypothesis; where security prices are assumed to reflect all public information, and to adjust swiftly to the arrival of new public information; market variables are employed as rough proxies for political risk determining market sentiment. This paper distinguished three important political risk proxies relevant to government bond securities.

The first proxy is called the liquidity spreads, derived from liquidity risks as in that an investor may not be able to sell a bond because there is no market for it. It is often measured on the basis of liquidity indexes, which aggregates several key indicators such as the distribution of quotes across dealers, trading activity and bid-ask spreads (Hund et al 1994: 14). The bid-ask spread is essentially a measure of the difference in price between the highest prices a buyer is willing to pay and the lowest price for which a seller is willing to sell it. The narrower the spread the most liquid is the asset. For instance, concerns over a Greek default on its sovereign debt caused a bid-ask spread to increase to about 99 basis points, compared with a 0.5 basis point for similar maturity German notes (Linsell et al 2015) (Hund et al 1994: 14).

However a number of studies questioned the consistency of the metric, since measuring it is difficult and the information needed is often unavailable to individual investors. As government bond trading is not centrally organised on exchanges like it is the case for stock, intraday data on quotes are not available. Therefore trading cost measures like intraday bid-ask spreads cannot be computed for the bonds markets (Schetag et al 2015: 2).

A second political risk proxy is called the interest rates volatility index. Measuring and analysing volatility of interest rates is considered as an important indicator, because it provides information about underlying macro-economic uncertainty and market perceptions of the economic outlook (Cuadra 2006). Up to 30% of its variation is accounted by market

expectations and uncertainties over monetary policies and inflation (Cieslak et al 2011). A number of studies noted a positive relationship between political uncertainties, business cycle fluctuations and the volatility of a country’s interest rate spreads in developing countries. In fact a significant increase in short term interest rate volatility from political risk has been evidenced in Brazil, Bolivia, Ecuador and Venezuela in 2005. However, despite the importance of the concept, no measure of interest rates volatility currently available is entirely satisfactory for several reasons (Brousseau et al 2013). “Most of them do not react to interest rate risk, and are usually contaminated by factors such as convenience yield, collateral cost and other factors that a rigorous analysis may not ignore, but should keep from interest rate risk per se”(Brousseau et al 2013). Finally and most importantly Credit Default Swaps. A Credit default swap is a credit derivative contract where the bond holder makes periodic premium fee payments to the swap issuer in exchange for a commitment to payoff should the government default on its debt. It is an insurance which is also used for hedging and speculation. The premiums of CDS contract are also determined by the market’s view of how likely it is that default will occur before the credit swap matures. If the market senses an increased probability that the issuer will default on some or all the future payments, the value of a CDS increases.

Market players use CDS as a proxy for political risk. Yet, despite its wide use, CDS are clumsy and risky tools to assess political risk. Egypt’s five-year CDS hit record highs following mass demonstrations, but fell after the army removed Islamist president Mohamed Morsi, as investors felt confident about the return of stability and hoped for a more business-friendly environment. (See figure1).

Figure 1 – Egyptian Bonds CDS prices

Price fluctuations in CDS premiums during the Egyptian crisis are a classic example of how markets tend to overact to the end of the crisis assuming it is over, and underreact when the

early signs of crisis are showing on the horizon. The continued fall in CDS prices, suggesting a return of stability is a quick and far-fetched conclusion. An anatomy of the nature of regional relations and the state of the country’s finances could suggest otherwise. The reality was that the overall picture of the Egyptian economy after the removal of President Morsi was more concerning than ever.

From an economic perspective, Egypt’s foreign reserves stood close to the critical minimum threshold reserves as a result of a sharp drop in tourism and FDI (Cook 2014). This exacerbates Egypt’s sensitivity to changes in commodity prices, given that it is a net importer of energy and wheat. To defend its currency, the government would have to burn through its limited foreign reserves. Recently the government acknowledged that foreign reserves were being spent at an average of $1bn to $1.5bn per month. And with high levels of unemployment, the central bank could be forced to print money to offset any deflationary effect as a result of the sterilization; which would compound inflationary pressure associated with depreciation. Return of investor confidence could be partially explained by the large influx of financial support that Egypt received in loans and donations from Saudi Arabia, the United Arab Emirates and Kuwait; who strongly supported the removal of President Morsi (Wilson 2014). However, Gulf assistance has provided Egypt with only a bare minimum relief ($12bn). In the meantime, there was still an estimated annual $10bn gap in financing the government deficit and with government debt reaching 90.50 per cent of GDP, receiving foreign assistance was only adding to the debt burden while masking problems that are rooted in Egypt’s’ economic capabilities and objectives. From a political perspective if Egypt’s financial needs prove to be greater than anticipated, Gulf support may not be sustainable especially if their interests clash with those of Cairo. This assumption is not shared by investors who fail to see the changing nature of regional relations. Investors felt that “the speed at which the aid was announced, suggested that gulf nations viewed supporting post-Morsi governments as a geopolitical priority – so if Egypt turns out to need yet more aid, it may be forthcoming” (Uppal 2011). This view, however, neglects at great length the changing nature of international relations which are constantly shaped by new priorities in national interest. The reality is that Egypt’s tense relations with the United States resulted in blossoming relationship with Russia. This is not particularly appreciated by Saudi Arabia who historically has always sided with Washington over Moscow (Taylor 2015). Should regional foreign policy priorities change with the Saudi, Egypt will certainly find itself in further financial dire straight. After all, the willingness of important donors like Qatar changed rapidly as it demanded a refund of $ 2bn aid it provided in 2013 (Werr et al 2013). Furthermore, the United States and the European Union who supported a democratic transition refrained from supporting Egypt financially from fears it would be interpreted as a supportive act to the military coup. This also implied that there was little prospect that the IMF loan for $4.8bn would materialise (Kagan 2013). However, if it was to materialise, the government would have to comply with the IMF’s recommendations to make fundamental changes to the food and fuel subsidy programs which have been a critical component of Egypt’s social safety net and an important mean of political control. Anwar Sadat’s proposed alteration resulted in the 1977 Bread Riots and mass demonstration. Such policies could result in a similar situation and potentially bring large numbers of people into the streets.

Continued protests amidst concerns over freedoms, and with Egypt’s internal security services tendency to use too much force to respond to demonstrations may encourage people to join protests and rallies could spread throughout the country (Euronews 2015).

Therefore, despite the boost in confidence over Egypt, the situation is still precarious as the country continues to be exposed to a number of potential political risks with considerable economic consequences.

As insightful as CDS prices could be, the metric fails to capture the building process of endogenous and exogenous shocks that could make a solvency crisis a significant possibility. This is purely because market perception of political risks remains merely superficial and devoid of any political scientific basis (Sonmez 2015) (Cohen 2013).

B– Sovereign Credit Ratings For financial investors, credit ratings are a significant tool for assessing levels of political risk associated with investing in a particular country and for governments they are important for attracting capital. Therefore, the manner in which they are determined is critical. Credit ratings address two key factors: the governments’ inherent likelihood of making repayment; and, in the case of foreign currency ratings, the issuer’s profile taking into account political factors likely to hinder the borrower’s ability to meet their obligations. The rating methodology draws on a range of indicators of distress, which are incorporated in risk models. Risk of default however, seems to be more inspired by economic factors than political ones. Four key indicators are considered altogether: Growth, inflation, external balance, and the level of unemployment. The study focuses on the debt burden of a country and its ability to service it, as well as other external liabilities of an economy such as foreign holding of foreign investment that may lead to requirements of foreign exchange reserves causing stress on the economy.

It also relies on the review of indicators such as the ratio of debt to export and debt to GDP, fiscal balance and the growth of monetary of aggregates and the size and nature of foreign exchange reserves. Similarly, government fiscal policies are examined in terms of compatibility with the country’s economic development and seek to encapsulate government budgetary flexibility. Demographics of the country’s populations, levels of productivity between levels of different sectors in the economy and the degree of urbanisation of the economy are also taken into account and used to generate projection on the economy’s cash flows and development capabilities. On the other hand, when addressing the political aspect of risk, the methodology is limited to an evaluation of the competence of the country’s administrative machinery, levels of democratisation, clarity of leadership succession mechanisms, independence of the judiciary and freedom of the press. This is in addition to inputs such as transparency international corruption perception index and the Freedom house list of “true democracies”.

However, when we look more deeply into rating agencies, it is not clear how they are determined: identifying the relationship between the criteria and the actual ratings is difficult; this is in part because some of the criteria are not quantifiable. Besides, rating agencies provide little guidance as to relative weights they assign each factor. Details about how the political and economic categories and subcategories are weighted relative to other variable are not explicit. The stated political criteria are quite vague: Standard & Poor has a category entitled “stability and legitimacy of political institutions” which is difficult to measure. This makes it difficult for countries to establish which economic and political criteria to meet in order to gain in ratings.

Furthermore, credit ratings have been increasingly criticised for being largely focused on the “ability” rather than the “willingness” of a country to pay back its debt. Eaton and Gerovitz were the first to stress that an important characteristic of sovereign debt defaults are determined not only by a country’s ability to pay, but also its willingness to pay its debt (Moser 2007:5): A debtor country could default either due to lack of economic resources or simply unwilling to fulfil the responsibility when capable. While the former is determined by macroeconomic conditions, the latter are purely determined by political factors. For example, in August 1998 Russia voluntarily defaulted on its foreign denominated debt. Newly appointed Prime Minister Sergei Kiriyenko, made a political decision to devalue the Russian Rouble and default on its government debt. “Investors quickly discovered that Russia’s calm had been the eye of the storm”(Bremmer 2006:14). The country was perfectly capable to make payments in domestic currency, but chose to default on foreign denominated bonds. Reisen and Von Maltzan further argued that most of CRAs neither conduct rigorous studies nor deploy sophisticated methods for predicting the borrower default potential (Reisen et al 1999: 21). To this respect, a number of studies observed the existence of incentives for CRA to indulge in herd behaviour due to the cost savings that result from following other agencies’ leads (World Bank 2000: 49). The World Bank noted “Ratings are primarily based on publicly available information; the conventional belief that they are based on advance knowledge or superior information is questionable” (World Bank 2000: 49). . This makes them more reactive than predictive or preventive and they tend to lag rather than lead financial markets. This was evidenced in the Asian crisis of 1997 when CRAs did not lower ratings before the crisis broke, hesitated afterwards and drew enormous criticism to their behaviour. The World Bank added “because credit ratings have tended to react to changes in creditworthiness rather than accurately predict them, their use in determining capital requirements could accentuate the pro-cyclical nature of capital flows to emerging markets” (World Bank 2000: 49).

North, Weingast and Shlutz further argued that inconsistencies in credit ratings are misleading and have a major impact on capital flows. They distinguished a “democratic advantage” that attracted greater capital flows for democracies. This is built on the assumption that democracies make more credible commitments to repay debt, because of the damaging implications a default would have on re-election goals (Tomz 2002: 2). However, this notion has been questioned by analysts such as Tomz who claimed that there is a conditional rather than direct relationship between democratic accountability and debt repayment. “Democracy and debt repayment do not necessarily go hand in hand in developing countries” (Tomz 2002: 2).

Political stability is important but cannot be tied to regime type. Indeed, some authoritarian governments appeared as stable if not more so than their economic counterparts. To this respect, Ian Bremmer argued that democracy is not the most important factor in determining a nation’s stability. That’s because stability does not depend on the level of democracy and openness of institutions but rather on the state’s ability to withstand shocks and the ability to avoid producing them. A nation is unstable if both are absent. In fact police states have more in common with democracies than they do with badly run authoritarian regimes. For instance, “Algeria has more in common with the United States than it does with Zimbabwe. Instability on the other hand does not necessarily lead to crisis, but the probability of the state failure is highest when governments have the least “political capital” with which to respond to turmoil”(Bremmer 2006: 14)

Tunisia is a clear example of that. Under the dictatorship of President Ben Ali the country

enjoyed over 22 years of uninterrupted stability and growth until December 2011. If we take a closer look at risk ratings for 2010, we notice that Tunisia was a notch down from Baa1 making it a medium risk investment grade. In the EIU political instability index, Tunisia in 2010 scored better for political stability and economic distress than Italy, France and the UK, while credit insurer ONDD classified Tunisia as belonging to “category 4”, along with countries such as Malta, New Zealand and the Philippines.54

However, the leaked diplomatic cables suggested that from the geopolitical perspective the United States no longer perceived the Ben Ali regime as legitimate and suggested it was not opposed to a regime change. While the country continued to show signs of stability throughout 2010, the information revealed by the American diplomatic cables were important signals of the regimes’ loss of “political capital”, combined with public anger, it created a significant potential to generate civil unrest and instabilities that are unlikely to be contained. In the meantime, no one understood the broader implications of WikiLeaks revelations and their likely effect on a global shift in power and stability in the Arab world.55 In fact, neither investors nor credit rating agencies succeeded in foreseeing the Arab Spring. For instance, rating agencies such as Moody’s changed Tunisia’s rating outlook form stable to negative over a week after the ousting of President Ben Ali (Sottilotta 2013: 3).

Critique and Conclusion The analytical dimensions of risk in the financial investment industry are of limited methodological value and conceptually flawed. First, it assumes a rather simplistic view of political processes and markets.

The assumption that market volatility is “mean reverting” entails that markets are assumed to be prone to equilibrium and self-regulating. This suggests that markets are perfect or near perfect and neglects at great length notions of market imperfections, information asymmetry, and activities such as herding or any other type of market failures which are more characteristic of the real economy. Secondly, the assumption that market indicators such as implied volatility, CDS premiums and liquidity spreads are valid proxies for assessing political risk implies that markets are considered as perceptive to politics. However, as discussed above, public and expert opinions on political matters are rarely equal. Events thought to be of minor risks by technical experts often produce strong concerns from the public. This is because a social scientific approach to political risks is certainly superior to everyday life knowledge as it builds on empirical evidence and theoretical structures which are constantly subject to testing.

The slow and overstated reaction of markets to political events shows that the methodology suffers from limitations mostly as a consequence of imperfect information. This is because the approach is limited to historically constrained data sets and represents an objective rather than subjective assessment technique. Risk levels reflected by models have an inherent lag because they are not equipped to respond to change in the investment landscape as a result of political events. As Nassim taleb argued “our predictions may be good at predicting the ordinary, but not the irregular, and this is where they ultimately fail” (Callahan 2008). Models are necessary, but not sufficient when it comes to managing unquantifiable risks.

Robert Merton winner of the Nobel Prize for his work on stock options wrote” the mathematics of models is precise, but models are not, being only approximation to the complex real world. Their accuracy as a useful approximation to that world varies considerably across time and space” (Merton et al 1994: 14).

Besides, the conceptual basis of understanding political risk in the financial industry is narrow as it treats political risk as a set of exogenous market interventions with negative consequences. Delimiting political risk to the activities of governments, disallows considerations of state and system type, and of possible correlations between the international system and domestic politics. While political risk is certainly a function of political activity of domestic settings, the approach should adopt a wider definition where political risk is perceived as a function of globalisation. This is because sources of political risk are not limited to the host country, but also imply factors that originate from the international and the global environments.

This is particularly true for credit ratings where the general approach to risk is based on an unsophisticated understanding of political risk bound to cultural perceptions rather than an alternative approach that is able to connect system type and political activities to risk events. “The democratic advantage” is an example of how low political risk and high political stability are embodied in assumptions that predominantly belong to the developed world, mostly western, liberal democratic and capitalist. Therefore, any states that display different characteristics to this definition are considered to harbour political risk and the possibility of instability.

A better approach to political risk should de interdisciplinary; drawing on the various theoretical traditions to develop a deeper understanding of economics and politics, states and markets, geopolitics and market dynamics; and treat both as mutually co-reflexive and constitutive.

A greater contribution of political science to political risk assessment could help identify possible trigger points that could pre-empt political instability and provide a valuable insight into risks associated with specific stages in the political modernisation cycles. The long term benefits could be numerous: an introduction of expert analysis of political risk in risk assessment can significantly restrict the speculative boundaries of markets on political events and political developments. Through a superior understanding of political risk financial investors won’t flee at the first sign of trouble. This will first help smooth the pro-cyclicality of capital flows in developing economies and prevent wealth erosions as a consequence of capital flight. More stable currency exchange rates may reduce inflationary expectations and encourage investments.

Secondly, better informed investing can support price stability in commodity trading, and contribute to the general well-being of economies through lower budgetary restrictions, interest rates and inflation. And with better economic performance come lower probabilities of conflict, social unrest, and political instabilities likely to damage investors’ confidence; and will engage developing countries into a progressive cycle of development, where increased stability leads to increased investments, growth and ultimately enforced stability and so on.

Finally, for financial investors a more consistent method for assessing political risk implies a better understanding of downside risks, a better capacity to diversify investments, and an enhanced ability to adjust investments to match their risk tolerances. Therefore a perfected political risk analysis can be an important contributor to enhanced capital mobility, and a more equitable environment for developing countries to attract capital, grow and become competitive economies in an increasingly global economy.

But to achieve the desired effect, it is important that this approach is adopted by all market players. International financial markets regulators can play a significant role in introducing new regulatory standards for political risk assessment. One way of doing it could be through the inclusion of a political science contribution to the

examination system of financial investors. In the United Kingdom, fund managers, traders and financial analysts are subjected to a number of exams testing their knowledge on the regulatory environment, securities investments and standards of conduct and ethics. The Financial Conduct Authority (FCA) should consider expanding the testing environment to areas covering the topic of politics, international relations and political economy.

Bibliography Beaulieu, M., Cosset, J. and Essaddam, N. (2005). The impact of political risk on the

volatility of stock returns: the case of Canada. Journal of International Business Studies, 36(6), pp.701-718.

Bremmer, I. (2007). The J curve. New York: Simon & Schuster Paperbacks. Callahan, G. (2008). Nassim Nicholas Taleb: The black swan: The impact of the highly

improbable. The Review of Austrian Economics, 21(4), pp.361-364. Cieslak, A. and Povala, P. (n.d.). Information in the Term Structure of Yield Curve Volatility.

SSRN Electronic Journal. Clark, E. and Tunaru, R. (n.d.). Emerging Markets: Stock Market Investing with Political

Risk. SSRN Electronic Journal. Cont, R. and Bouchaud, J. (2000). HERD BEHAVIOR AND AGGREGATE

FLUCTUATIONS IN FINANCIAL MARKETS. Macroecon. Dynam., 4(02). Cuadra, G. and Sapriza, H. (2008). Sovereign default, interest rates and political uncertainty

in emerging markets. Journal of International Economics, 76(1), pp.78-88. Erb, C., Harvey, C. and Viskanta, T. (n.d.). Expected Returns and Volatility in 135 Countries.

SSRN Electronic Journal. Fitzpatrick, M. (1983). The Definition and Assessment of Political Risk in International

Business: A Review of the Literature. The Academy of Management Review, 8(2), p.249.

Glewwe, P. (2002). Review of World Development Report 2000/2001: Attacking Poverty, World Bank Oxford University Press, Oxford, 2001, 335 pp.

Hund, J. and Lesmond, D. (n.d.). Liquidity and Credit Risk in Emerging Debt Markets. SSRN Electronic Journal.

Kasperson, R., Renn, O., Slovic, P., Brown, H., Emel, J., Goble, R., Kasperson, J. and Ratick, S. (1988). The Social Amplification of Risk: A Conceptual Framework. Risk Analysis, 8(2), pp.177-187.

Making services work for poor people. (2004). Choice Reviews Online, 41(09), pp.41-5366-41-5366.

Merton, R., Simons, R. and Wilkie, A. (1994). Influence of Mathematical Models in Finance on Practice: Past, Present and Future [and Discussion]. Philosophical Transactions of the Royal Society A: Mathematical, Physical and Engineering Sciences, 347(1684), pp.451-463.

Reisen, H. and von Maltzan, J. (1999). Boom and Bust and Sovereign Ratings. International Finance, 2(2), pp.273-293.

Robock, S. (1971). Political Risk: Identification and Assessment. Columbia Journal of World Business.

Schestag, R., Schuster, P. and Uhrig-Homburg, M. (n.d.). Measuring Liquidity in Bond Markets. SSRN Electronic Journal.

Sethi, S. and Luther, K. (1986). Political Risk Analysis and Direct Foreign Investment: Some Problems of Definition and Measurement. California Management Review, 28(2), pp.57-68.

Sjoberg, L. (1999). Risk Perception by the public and by the expert: a Dilemma in Risk Management. Centre for risk research.

Smulders, S. (2009). Global Sustainability: Social and Environmental Conditions, by Simone Borghesi and Alessandro Vercelli, New York: Palgrave Macmillan, 2008, $90 cloth, 288 pp. Land Economics, 85(3), pp.552-554.

Sottilotta, C. (2013). Political Risk: Concepts, Definitions, Challenges. Luiss Guido Carli School of Government.

Tomz, M. (2002). Democratic Default: Domestic Audiences and Compliance With International Agreements. Stanford University.

Internet

Author: Bachrach J. Title: “WhikiHistory: Did the Leaks inspire the Arab Spring?”

Website: World Affairs, 2011. Available At: [ http://www.worldaffairsjournal.org/article/wikihistory-did-leaks- inspire-arab-

spring ]

Author: Brousseau V., Durre A. Title: “Interest rate volatility a consol rate-based measure”

Website: European central Bank, Working paper series NO1505, 2013, Available at: [https://www.ecb.europa.eu/pub/pdf/scpwps/ecbwp1505.pdf?d90bba5a1ae9

9af12af142fa1a62ed82]

Author: Cohn C. Title: “Politics: The Unquantifiable risk that is rising in emerging markets” Website:

Thomson Reuters, 2013. Available At: [http://blogs.reuters.com/globalinvesting/2013/07/04/politics-the-

unquantifiable-risk-that-is-rising-in-emerging-markets/]

Title : “Egypt Government Debt to GDP” Website: Trading Economics on the web, 2015

Available At: [ http://www.tradingeconomics.com/egypt/government-debt-to- gdp]

Author: Euronews Title: “Fears for Press freedom as Egypt’s Al-Sisi hardens anti-terror laws” Website:

Euronews, 2015. Available at: [http://www.euronews.com/2015/08/17/fears-for-press-freedom- as-egypt-s-al-

sisi-hardens-anti-terror-laws/ ]

Author: Global Credit Research Title: “Moody’s downgrades Tunisia’s to Baa3, Negative outlook”

Website: Moody’s Investor Service,2011. Available at: [https://www.moodys.com/research/Moodys-downgrades-

Tunisias-to-Baa3-outlook-negative--PR_212739]

Author: Harford T. Title: “Black-Scholes: the Maths Formula Linked to the Financial Crash”, Website: BBC

News Magazine, 2012. Available at: [ http://www.bbc.co.uk/news/magazine-17866646]

Author: Kagan R.

Title: ”In Egypt it’s past time for the Obama administration to use what power the U.S. has” Website: The Washington Post, 2013.

Available at: [https://www.washingtonpost.com/opinions/in-egypt-its-past-time- for-the-obama-administration-to-use-what-power-the-us- has/2013/07/05/86e0bd0a-e5a2-11e2-aef3-339619eab080_story.html]

Author: Linsell K. and Jenkins K. Title: “Greek Default Risk Believed in Markets as Bond Liquidity Dries up” Website:

Bloomberg Business on the web, 2015. Available at: [http://www.bloomberg.com/news/articles/2015-06-19/greek-

default-risk-belied-in-markets-as-bond-liquidity-dries-up]

Author : Richardson Paul Title: “Malawi Sells Tobacco at 32% below Government Mandate Price” Website:

Bloomberg on the web, 2012. Available at: [http://www.bloomberg.com/news/articles/2012-05-01/malawi-

sells-tobacco-at-32-below-government-mandated-price]

Author: Stewart I. Title: “The Mathematical Equation that Caused the Banks to Crash” Website: The Guardian,

2012. Available at: [http://www.theguardian.com/science/2012/feb/12/black-

scholes-equation-credit-crunch]

Author: Sonmez M.

Title: “A political Risk Wave on Top of Economic Risk” Website: Hurriyet Daily News, 2015.

Available at: [http://www.hurriyetdailynews.com/a-political-risk-wave-on-top-of- economic-risks.aspx?pageID=238&nID=83967&NewsCatID=344]

Author: Taylor A.

Title: “Saudi Arabia’s relationship with Russia is leaving Egypt stuck in the middle” Website: The Washington Post, 2015. Available at:

[https://www.washingtonpost.com/news/worldviews/wp/2015/03/30/saudi- arabias-hostile-relationship-with-russia-is-leaving-egypt-stuck-in-the-middle/]

Author: Uppal R.

Title: “Mideast Debt- Buyers Nibble at Egypt’s International Bonds” Website: Thomson Reuters on the web, 2011,

Available at: [http://www.reuters.com/article/2013/07/11/egypt-bonds- idUSL6N0FE1SE20130711]

Authors: Werr P. and Saleh Y.

Title: “Egypt returns $2 billion to Qatar in sign of Growing tensions” Website: Thomson Reuters, 2013.

Available at: [http://www.reuters.com/article/2013/09/19/us-egypt-qatar- deposits-idUSBRE98I0N020130919]

Author: Wilson N.

Title: “Saudi Arabia and UAE Ready Massive $20bn Aid Package to Boost Egypt’s Shattered Economy2”

Website: International Business Times, 2014. Available at:[ http://www.ibtimes.co.uk/saudi-arabia-uae-ready-massive-20bn- aid-package-

boost-egypts-shattered-economy-1450818 ]

Governing through precarity and debt in the European debt crisis: working at the intersection of late capitalist subjectivity

and mechanisms of global governmentality

Marie Paglinghi

Abstract Debt and precarity not only are dominant economic characteristics in current capitalist era, but by appealing to various affects such as guilt and fear, they form part of subjectivity and infuse one’s choices in life. Working at the intersection of the autonomist Marxist appreciation of late capitalism as biopolitical and Foucault’s ontology of power, this paper aims at demonstrating how the European sovereign debt crisis of 2009 revealed debt and precarity as dominant features of late capitalist subjectivity in industrialised countries, and how some mechanisms of governmentality such as austerity emerged as a response, which engulfed both individuals and states in their command. Greece will be treated as a case in point.

Introduction

Since the European sovereign debt crisis erupted in 2009, a sense of emergency has engulfed southern European countries and their creditors. Various mechanisms aimed at correcting what are seen as previous mistakes from national governments in their macroeconomic policies have been deployed, austerity being a major one. Promoted as a harsh but necessary economic recipe to reduce large deficits, austerity has been implemented in various countries in Europe, sometimes at the initiative of national governments and their people, sometimes imposed by peer countries and supranational entities. The latter have constantly stressed the individual responsibility of countries for their large public debt and largely dismissed any systemic or external causes as minor factors. Rather, indebted countries have been encouraged to clean their own mess and to prevent any risk of contagion to their peers. Nevertheless, it seems legitimate to enquire on the presence of large amounts of debt in industrialised countries before the crisis, both at the private and the public levels: what could have been the reasons for this piling-up of debt in large quantity, and are individuals and countries solely responsible for this? Also, how can one make sense of the fact that austerity is still being presented as a solution, considering both the ineffectiveness of previous measures in reducing public debt across Europe and their disastrous consequences such as the sudden immiserisation of regions largely presented as developed, human rights violations and a return of authoritarian and anti-democratic practices? In order to answer these questions, it is necessary to go beyond the claim that austerity is just a set of neutral economic policies, and debt is simply a financial contract for which the debtor is solely responsible; a position that justifies the lack of willingness in providing external support to indebted subjects and the vulnerable conditions, in other words the precarity, in which they find themselves. Rather, it is decisive to address debt and precarity from the point of view of subjectivity, as conditions that impact one’s behaviours and choices by appealing to affects such as anxiety and guilt. Through their manipulation of affects and values, debt and precarity hold a form of biopower in the Foucauldian term and offer mechanisms of self-regulation, or governmentality. This analysis sits at the intersection of Michel Foucault’s ontology of power and autonomist Marxist thinkers appreciation of late capitalism as breeding a certain kind of subjects, late capitalism designating here the capitalist era since the 1970s. Historically, debt and precarity emerged as norms in industrialised countries due to a particular context which is crucial to emphasise. Capitalist developments in reaction to the labour struggle of the 1970s and a neoliberal form of command emerging in parallel have largely encouraged individuals and countries to run large amounts of debt, and to live in a liberalised world where only competition matters, preventing any long term considerations and forms of cooperation. As a result, debt and precarity emerged not only as economic characteristics, but as dominant features of late capitalist subjectivity. Whereas before the sovereign debt crisis a period of decent economic growth in industrialised countries had allowed subjects to thrive in a world of prosperity, hiding the problematic character of indebtedness and precarity, the crisis represents the exceptional event that shed light on these elements as major issues and allowed for powerful tools of governmentality based on these features to emerge. In particular, the crisis allowed governmentality to deploy austerity as a major dispositif by claiming its necessity in particular times of emergency.

This paper is organised as follow. The aim of the first section is to expose the theoretical and conceptual frameworks of this paper and to understand how the emergence of a neoliberal governmentality interacted with capitalist developments since the 1970s to produce a kind of subject useful to capital, entrepreneurial and responsible for himself. The second section extends this form of rule from the domestic to the global and defines how collective subjects

such as states got enmeshed in it and are constituted through it, incited to thrive in competition with others and to constantly adapt to capitalist requirements. A third section will explain how late capitalism and neoliberal governmentality not only incited individuals and states to be competitive and entrepreneurial, but they also worked together to encourage these ones to get into debt. They also destroyed any form of social insurance and reduced possibilities of cooperation, putting subjects in conditions of precarity. These two features had been somehow marginalised by previous autonomist Marxist readings of late capitalist subjectivity. The European debt crisis represents a turning point as it revealed these features and allowed for new techniques of governmentality to emerge such as austerity. The fourth section will study the case of Greece, as a relevant example of a country governed through debt and precarity during the crisis. Some concluding remarks will terminate the paper.

1. Breeding subjectivities in late capitalism: working at the intersection of autonomist Marxism and Foucault’s ontology of power This part will expose the conceptual and theoretical apparatuses that serve as a framework for understanding the biopolitical nature of late capitalism, drawing upon the work of some Italian post-Marxist thinkers named autonomist Marxists. These thinkers have abandoned the structural approach of orthodox Marxism for an analytical frame that puts subjectivities and the immanent power of the working class at the centre of capitalist developments, understanding capitalism as reactionary to these ones. The notions of immaterial labor, social factory and human capital will be explored. Michel Foucault’s work on biopower and governmentality will also be introduced to demonstrate how a form of neoliberal governmentality emerged contiguously to these capitalist developments. Its rationalities largely interest with the logics of capital and allowed to produce subjects that are fit and proper for capitalist production.

1.1 Reactionary capitalism and the social factory

A classical Marxist approach to capitalism would emphasise the logic of domination that rests at the centre of its modes of production and accumulation. It would imply that the working class, or proletariat, is a unified and a priori existing subject that exists in a structural relation with capital, and which passively follows the diktats of the latter and its various transformations. In other words, the superstructure level of reproduction would be the main level of analysis (Hardt and Negri 2001: 27).

Opposed to this idea, the autonomist Marxist school has affirmed that the labour class does exist, but empirically rather than a priori. Instead of being a unified totality, labour is defined by a class composition which represents the kind of political subjectivity and the technical organisation that form the class (Kinsman 2004). These authors affirm that the power inherent to the labour class and its class composition are crucial for an understanding of capitalist developments. In other words they define capitalism as reactionary to labour’s struggle (Weidner 2009: 393, 394, Gill and Pratt 2008). As framed by Nick Dyer-Witheford, “labouring subjects resist capital’s reduction. Labour is for capital always a problematic “other” that must constantly be controlled and subdued, and that, as persistently, circumvents or challenges this command”(cited in Weidner 2009: 393). Capital is therefore pushed to restructure its ways of producing once a struggle by the proletariat arises, in order to affirm its command. This perspective highly contrasts with any accounts that emphasise the “inexorable logic of capital. Its accumulative logic.” (Weidner 2009: 393). Bodies and subjectivities become a crucial plane for the expression of power and this analytical frame moves from the

economic terrain to the corporeal, the cultural and the subjective ones (Hardt and Negri 2001: 27).

Having reinserted subjectivities at the core of their analysis and asserted that capitalism is reactionary by nature, these thinkers observe a shift in capitalist modes of production during the 1970s which will have decisive implications. They explain the cause of this shift by noting a “subjective transformation of labor power” in industrialised countries which inclined capitalism to restructure and led to a new form of capitalism to emerge (Hardt and Negri 2001: 269). This analysis strongly contrasts with an orthodox Marxist perspective which would emphasise the falling rate of profitability of the early 1970s in industrialised countries as the major cause for the subsequent capitalist restructuring (Harvey 2007). Autonomist Marxists, from their side, observe that starting from 1960s workers subjectivities became increasingly geared towards new values of creativity and flexibility, of which May 1968 movements attest, on top of demanding a higher level of welfare and rejecting the discipline and rigidity of the Fordist model of production (Hardt and Negri 2001: 269). This struggle of the proletariat over their mode of life gave birth to a restructuring of capitalism along the lines of these values and to some experimentation of new forms of production based on cooperation and communication, in order for capital to reassert its command. Immaterial labour, which can be described as a type of work that produces affects and desires through providing services and manipulating information, started developing during this era as a response, to become “one of the highest value-producing forms of labor from the point of view of capital” in late capitalism (Hardt 1999: 90). What kind of impacts these developments had on subjectivities in return? At stake in this new mode of production is not only the production of material goods but the “production of life itself”, as “its products are intangible, a feeling of ease, well-being, satisfaction, excitement, or passion” (Hardt and Negri 2001: 23, 293). The real subsumption defined in Marxian terms and picturing the alienation and intensification of labor to capital is replaced by the real subsumption of life itself to capital (Hardt and Negri 2001: 25). One of the aspects of late capitalism is perfectly described through the term “social factory”: labour is not delimited anymore to the place of work but has expanded to all social areas that can potentially bring capitalist value (Kiersey 2009: 383). In short, “the whole society is placed at the disposal of profit” (cited in Gill and Pratt 2008: 6). As Antonio Negri frames it, the sphere of production and society are largely indiscernible now as the factory disseminates itself into society, and “the value of labour and production is determined deep in the viscera of life”, in other words, in the realm of affects and desires (cited in Kiersey 2009: 383). Late capitalism constantly appeals to subjectivities and their capacity to reproduce life. In other words, it makes use of biopower.

1.2 Biopower and governmentality

Biopower is a term introduced by the French sociologist Michel Foucault and that can be understood as the power to foster the socially and morally ordered life of a population through an incitement of interests, which leads in practice to “an explosion of numerous and diverse techniques for achieving the subjugations of bodies and the control of populations” (Foucault 1978). Foucault observes that this form of power emerged in modern nation-states in Europe with the appearance of a liberal political economy during the course of the 18th century. The practice of governing shifted from a traditional form of sovereign rule being aimed primarily at containing rebellion inside a territory and that can be described “as the right to take life or let live” (Foucault 1990), to a later regime “that exerts a positive influence on life, that

endeavors to administer, optimize, and multiply it, subjecting it to precise controls and comprehensive regulations” (ibid). Under this regime the management of the population is effected primarily through disseminating ‘technologies of the self’ (Foucault cited in Weidner 2009: 398) which cultivate certain modes of conduct and values and which invite subjects to self-regulate themselves by integrating these values. Therefore, this form of rule that makes use of biopower and that Foucault names governmentality acts “upon subjects who ought to be considered free” (Lazzarato 2006). Its 'technologies of the self' are disseminated through various ‘dispositifs’, understood here as particular balances of forces at a given time, embodied by institutions, discourses, laws and regulatory mechanisms (Bussolini 2010).

In the birth of biopolitics Foucault concentrates on the latest form of governmentality, neoliberalism, which he sees emerging with the thoughts of the Ordoliberal school of economics and later slightly modified by the economists of the Chicago School (Vrasti 2013: 60). The latter actively promoted their monetarist ideology in reaction to the accumulation crisis of the 1970s and its labour struggle. As a result, neoliberal governmentality started establishing itself in some industrialised countries such as Great Britain and the United States. As its core premise, neoliberal governmentality takes the market as its ‘veridiction' site: any human actions should be guided by it, and governmentality appears as “a sort of economic tribunal that claims to assess government action in strictly economic and market terms” (Foucault cited in Behrend 2015: 36). One should not understand market here as the human inclination to exchange, as had been expressed in early liberal tradition, but instead as a system of “competition and inequality” (Lazzarato 2006). States’ interventions should not be restricted, rather they should work solely at establishing the perfect conditions for the market to play its function of competitiveness, notably by producing the kind of subjects needed for a functioning market economy, competitive and entrepreneurial (Vrasti 2013: 60, Lazzarato 2006). Neoliberal governmentality expresses itself through various dispositifs that sometimes coexist in an heterogenous way, through they all refer to 'technologies of the self' and act in accordance with the principle of holding the market as “a site of veridiction” (Selmeczi 2009). A crucial implication of this entrepreneurial regime of subjectification is the fact that its subjects are not only free to choose for themselves, but they are also responsible for their well-being and inclined to bear the consequences of their decisions (Weidner 2009: 403). 1.3 The production and management of subjects in late capitalism How can one reconcile Foucault’s appreciation of neoliberal governmentality and its form of biopower with late capitalist restructuring and the appearance of the ‘social factory’ previously explored? Simply by working at the intersection of both processes of subjectification. At stake in late capitalism is the production of affects and therefore a form of subjectification through the use of biopower, a normalisation of subjects productive to capitalism (Rizvi 2012: 498). What neoliberalism does on its side is to produce a certain kind of subjects suitable to its core values and manageable through a constant appraisal of “the potential of the marketplace as a “technology of the self” for the production of healthy, entrepreneurial subjects” (Kiersey and Weidner 2009: 357). Both processes largely intersect as proven by the notion of human capital provided by autonomist Marxist thinkers. This one illustrates how in the workers’ mind of current capitalist era, wage increasingly represents an income that is the result of their own human capital, and not the price of their labour as in classical Marxist terms (Lazzarato 2006). Wage is approached from the subjective perspective of the worker, as something that needs to be maximised in order for him to succeed in life. This framework allows to understand how late capitalism makes use of biopower to encourage workers to ‘voluntarily’ choose to invest in their own human capital. Workers can decide to enhance their mental and physical abilities through getting a scholar education, or to

increase their mobility in order to have a successful career (Lazzarato 2006). Here, the intersection between neoliberal governmentality and biopolitical capitalism is clear. Both rely on 'technologies of the self' through making use of biopower and give the impulsion to invest in oneself, to be entrepreneurial and to succeed in life. Neoliberal governmentality completes this process of subjectification by disseminating its own codes of conducts, providing the market as the universal measure of success, and reminding everyone of its own individual responsibility in this very success. Incorporating late capitalism and its link to subjectivity into a Foucauldian perspective appears therefore to offer fruitful conclusions. As Cromby and Willis expresses:

Neoliberalism proceeds by harnessing desires for independence and creativity to the interests of business, reconfiguring workers as entrepreneurs of their own skills and abilities, and reconfiguring the social relations of capitalism to emphasize competition, not between workers and capitalists, but between workers themselves (Cromby and Willis 2013).

2. At the global level: global governmentality in late capitalist order This present part will aim at extending to the global level the conceptual framework presented in the first section. First it will demonstrate how governmentality as a method is not delimited to the domestic realm but can easily move from the micro-level to the macro-level. Second, it will describe how a new form of global command that intersects with capitalist dynamics got established, drawing upon Hardt and Negri’s description of global relations of power in late capitalism in their book Empire (Hardt and Negri 2001).

2.1 The conceptual debate on global governmentality The question of extending governmentality to the global has not been without debate. Thinkers like Jan Selby inquire the ability of governmentality to correctly depict the uneven relations of power between states which got established historically through imperialist and exploitative practices. Jonathan Joseph, in a similar vein, asks if global governmentality does not obfuscate previous imperialist patterns by offering a definition of the operation of power as “self-governance under conditions of formal freedom” (Foucault cited in Kiersey 2009: 368).

First, the question of power differentials being ignored by a Foucauldian ontology of power arises from a misunderstanding of both Foucault’s motivations and the nature of its concept of governmentality. Foucault’s method departs from the statist ontology of mainstream IR tradition in the sense that it does not posit the existence of states or any other institutional entity a priori, but rather as socially and historically constituted elements, as results of a long history of struggles of men. In other words, Foucault maintains the level of subjectivity and its immanent power at the core of any understanding of social developments. His method is empirical by nature and will sometimes lead to particular institutions or states as historically established locus or subjects of governmentality which, together with individuals, form a network of power. It does not pretend to be universally applicable a priori, “but should be considered simply as a point of view, a method of decipherment which may be valid for the whole scale, whatever its size” (Kiersey 2009: 379). It therefore largely bypasses established binary oppositions such as domestic versus international and micro versus macro levels (Vrasti 2013: 51). It also recognises that various elements in the network can have different power relations which each others even if they evolve in conditions of formal freedom.

However, Foucault established that neoliberal governmentality is aiming for a normalisation of its subjects under universal standards, with the market as universal measure of truth. As a result, global governmentality manifests its strength “by acting as a standard of reference against which all forms of life (individual, communal, political) can be assessed according to modern conceptions of civilisation and order” (Vrasti 2013: 64).

Second, it is necessary to recognise that Foucault was clear that liberal governmentality and its neoliberal successor did not erase the presence of discipline and sovereignty as complementary forms of rule. Rather, Foucault recasts the use of biopower and its capacity to regulate “modes of action” (Foucault cited in Kiersey 2009: 366) in a triangular relation with the two other traditional forms of rule. This observation can be extended to the global level, by arguing that a form of global command can combine the self-rule of governmentality with authoritarian and disciplinary practices of some sovereign elements over others, be it states or supranational institutions (Vrasti 2013).

2.2 States as subjects of governmentality, normative framework and sanctions

Hardt and Negri, in their book Empire, embed their analysis of biopolitical capitalism inside this conceptual form of global command and establish how late capitalism played a crucial role in formulating some aspects of it (Hardt and Negri 2001). The conceptual framework used in the rest of this paper to depict late capitalist order will rest on their formulation. They demonstrate how a new form of imperial rule recasting sovereignty, discipline and governmentality at the global level emerged as late capitalism expanded, establishing “a new notion of right, a new inscription of authority and a new design of the production of norms and legal instruments” (ibid 9). The normative apparatuses, dispositifs and technologies of this “globalized biopolitical machine” function at the service of capitalist logics (ibid: 40). Individuals, states, and institutions are all subjects of this new form of command and form a network through which power operates. States appear both as sources and subjects of governmentality integrated in this transnational command. Similarly to individuals, they are pushed to behave like competitive entrepreneurs, responsible for their own actions and encouraged to thrive inside capitalism. These requirements translate into notions of good governance which are diffused along the network, and states are constantly encouraged to stay fiscally healthy, to maintain a high level of security in order to attract foreign capital, or to promote free trade (Vrasti 2013: 64). Various dispositifs of governmentality such as global monetary mechanisms act not only as tools of governance, but also for the legitimation of Empire through productive & linguistic practices (Hardt and Negri 2001: 34, 35). Markets are the universal holders of truth, which sits in contrast with traditional forms of political practice of national sovereignty:

Popular sovereignty is subordinated because the only will that counts is that of the markets, of the international financial institutions that express, day by day, their ‘political’ will in real time through the stock markets and the spread (Lazzarato 2013).

Empire as defined by Hardt and Negri is a form of command which fosters and manages hierarchies between its elements. In particular, it entertains the ones among national or regional economies which emerged with uneven forms of economic and social developments and which rest on differentiated exchange relations, debt and credit relations (Hardt and Negri 2001: 280). It allocates some countries or institutions with a role of guarantors of capitalist functioning. In particular, the United States holds the position of the hegemon while some other states represented by the G7 control monetary instruments and trade (ibid: 309). Other

elements such as the International Monetary Fund (IMF) and other supranational institutions complement this “symbology of the imperial order”, by endorsing markets as universal truth and disseminating neoliberal codes of conducts. Moreover, all these elements possess a form of sovereign authority granted to them by their dominant and symbolic role in the global order (ibid: 31; Marton 2014).

Due to the presence of these sovereign elements, Empire not only has the capacity to set the rules of the game and define the normative framework of global capitalist functioning, but it also has the ability to police any deviant subject (Hardt and Negri 2001: 16). Deviance here is understood as any behaviour that challenges the normative framework described above and that potentially threatens the stability of the capitalist order. Markets being the ultimate site of truth and constantly reevaluating their appreciation of states practices, expressing any deviant behaviour through their own metrics, the boundaries between core and periphery are constantly reappraised and require interventions, which stays in stark contrast with previous forms of capitalist order that had stable boundaries between core and periphery. Indeed, “center and margin seem continually to be shifting positions, fleeing any determinate locations”(ibid: 39). A crucial aspect of these policing interventions is that they are always presented as exceptional even if crisis constantly arise (ibid: 38). This “state of permanent exception” is inherent to Empire. In this sense, interventions serve to reinforce the stability of the order as much as contributing to “the construction of the moral, normative and institutional order of Empire” (ibid: 38).

3. Governing through precarity and debt in the European sovereign debt crisis Previous sections have demonstrated how the biopolitical character of late capitalism coupled with a neoliberal form of governmentality have allowed a form of global command to establish itself and to produce a certain kind of subjects, entrepreneur of themselves and responsible for their success, both at the individual and state levels. It will now be argued that the European sovereign debt crisis of 2009 has put in appearance two other fundamental features of late capitalist subjectivity that had been to a certain extent marginalised by autonomist readings: its precarity and indebtedness. The economic crisis can be envisioned as the “critical event” which made these features visible and allowed for new mechanisms of governmentality to emerge based on these ones (Das, cited in Kyriakopoulos et al 2014). This form of subject, rather than being managed through desire, is now being governed through the dissemination of 'technologies of the self' resting on fear, anxiety and guilt. 3.1 Precarity and debt: definition and emergence as norms in late capitalist order

Precarity is a neologism that shares some etymologic roots with the term precarious, both terms forming a quite recent field of study notably inside the autonomist Marxist school (Gill and Pratt 2008). Precariousness designates an existential and common feature of human lives that arises from everyone’s life being dependent on others. Humans are precarious because of “the fundamental social dependency of a living being due to its vulnerability, due to the impossibility of a wholly autonomous life” (Lorey 2011). Precarity on its side is a politically and socially induced process defined by “the hierarchized difference in insecurity arises from the segmentation, the categorization of common precariousness” (ibid). It takes the form of an uneven distribution of material and symbolic insecurities in society. This uneven distribution protects the life of a group of people while it marginalises others by making their own life insecure, uncertain and vulnerable. These characteristics, by being embodied and experienced

through everyday life, induce an anxiety and a fear concerning the ability to survive. One’s place in society is always at risk of becoming marginalised, put at the periphery. These affects therefore impact one’s process of subjectification and induce certain behaviours, which means that precarity holds some potential as mechanism of governmentality, what Isabell Lorey calls ‘governmental precarization’ (Lorey 2011).

How can one account for the emergence of precarity as a dominant feature of late capitalist society? Conditions of precarity in wage labour are not in any way a new phenomenon. As Angela Mitropoulos recalls, the presence of “regular, full-time, long-term employment […] is an exception in capitalist history. That presupposed vast amounts of unpaid domestic labour by women and hyper-exploited labour in the colonies” (Mitropoulous 2005). Precarity previously existed, but was exported outside of the core to the periphery (Lorey 2011). In contrast it is now a process internal to the capitalist order, a mean of intensification of capitalist relations of production since the 1970s. The trends in labour flexibilisation and trade liberalisation that happened in reaction to the labour struggle both induced precarity in wage labour (Weidner 2009). More than this, as capital started investing the social factory, autonomy of bodies has been reduced to zero as the whole cycle of reproduction of human bodies is embedded in capitalist logics. The result is not only a precarity in wage labour but “a destabilization of ways of living and hence of bodies” inside the capitalist order (Lorey 2011). Alongside these developments emerged a neoliberal governmentality which actively promoted free trade, a reduction of the welfare state, and a constant diminution of labour power, all adding to precarity. Here again, the dynamic between neoliberal governmentality and the logics of reactionary capitalism reinforcing each other appears crucial to an understanding of the production of a certain kind of subjects inside late capitalist order. While still free to choose for themselves, subjects are now inclined to become even more flexible, more adaptive to capitalist needs in order to survive, all the while unable to project themselves on the long term. Any forms of social insurance have been destroyed. Instead, a form of “individualized risk management” guided by a neoliberal code of conducts is required in order to survive (Lorey 2011). Here, one can trace the link with the concept of human capital previously explored where one is inclined through desire to maximise its own success and take responsibility for it. However in this new framework, precarization offers to take one’s own responsibility not to achieve success but survival at best and appeals to fear and anxiety. In this surviving mode, each subject is in a constant race versus others and inequalities flourish. Indeed, while precarity becomes normal, “inequalities are not abolished. Neoliberal logic has good reasons not to want to end inequality, because it plays with hierarchized differences and governs on this basis” (Lorey 2011).

It is defended here that precarity has become the norm not only at the individual level but also at the state level. As expressed in the second section of this paper, countries were enjoying relatively stable hierarchical positions inside the capitalist order before the 1970s. However the emergence of neoliberal rationalities at the global level taking markets as universal truth means that governments now need to constantly adapt to capitalist developments and play the game of economic competitiveness, in a constant race to the bottom. Market actors and supranational institutions have been granted the ability to evaluate countries responsiveness through all kind of measures like yields, credits and other ratings which reinforces this dynamic (Fougner 2008). As a result, one can observe a shift of boundaries between the core and the periphery inside the global order. It is defended here that precarity at the states level can be approached as the conditions that results from this dynamic and which affect countries’ ability to rely on their peers and supranational institutions for their trade agreements, funding abilities and all kinds of diplomatic support, and which prevent any long term considerations in policy-making. Precarity is now inherent to the global capitalist system as the periphery

regularly integrates the core and creates zones of extreme marginalisation inside regions previously stable economically and politically. Indebtedness on its side is more than just an economic situation of an entity that has subscribed some debt vis-à-vis another entity, as a standard definition would suggest. When considered from a subjective point of you, being indebted encompasses both some moral and social aspects as Lazzarato demonstrates in its book The Making of the Indebted Man (Lazzarato 2012). He asserts that owing a debt creates in the subject a certain type of memory, first of its promise to repay, but also of its fault for having entered the contract, from which a certain kind of social link with the creditor emerges (ibid). As Stavrakakis frames it, “this creditor-debtor relationship involves ‘an ethico-political process of constructing a subjectivity endowed with a memory, a conscience, and a morality that forces him to be both accountable and guilty” (Stavrakakis 2013). The moral component of debt has a direct impact on the subject’s choices towards the maximisation of his human capital: these choices are going to impact its capacity to repay its debt, and are therefore infused by moral and affective considerations. Crucially, being indebted compels the subject to accept to be constantly evaluated by its peers, credit institutions, and institutions of governance, who in exchange offer a set of economic prescriptions. While still free in absolute terms, indebted subjects have a strong incentive to abide to these prescriptions in order to escape hardship and suffering. As Costas Douzinas expresses, “debt ensures the obedient conduct of the debtor, closing off possibilities of resistance” (Douzinas 2014). In fine, debt acts as a governmental machine that breeds a certain kind of subjectivities and “works at the intersection of power, morality and the economy” (Stavrakakis 2013). The level of individual debt exploded in developed capitalist countries after the economic crisis of the 1970s. The erosion of the rates of profit was in part overcome by new speculation and money being made on shares and other forms of financial investments, developing the power of the financial sphere (Radice 2011). Most importantly, in reaction to the demand for more welfare from the working class, national governments actively pushed for the creation of tax schemes that encouraged “the spirit of loan-dependant consumerism” (Stavrakakis 2013). This provided the necessary support for a “delicate balancing act” between the loss of social and political rights for lower classes in exchange for purchasing power through credit and debt (ibid). As a result, “people no longer have a right to housing but have access to housing/mortgage credit; people no longer have a right to higher education, but can take out student loans” (O’Shaughnessy 2012).

At states level, the high level of sovereign debt in industrialised countries is also a consequence of the crisis of the 1970s: as a reaction to the latter, capitalist logics encouraged national governments to face their diminishing revenues by running large deficits (spending more than they generate in revenue) as a way of avoiding facing the contradictions inherent to the capitalist system and that caused the crisis of profitability (IMF 1996; Krippner 2012). As monetary orthodoxy was emerging as a core rationality of neoliberal governmentality, these deficits had to be funded mainly through public debt rather than through printing money in order to keep the market as universal site of truth and to avoid creating inflation (Lordon 2010). As a result, states now have to maintain a high level of creditor confidence above all other matters in order to keep their ability to finance themselves on financial markets. In the process they lost some of their decisional autonomy and their capacity to rely on themselves for funding, adding to their conditions of precarity. Finally, most countries whose banks were enmeshed in the subprime crisis of 2007 had to bailout these ones, which represented an outrageous transfer of money from the public to the private sector (Douzinas 2014 : 87, Stavrakakis 2013). This added to the burden of public debt.

3.2 The sovereign debt crisis, scarcity and the state of exception Whereas conditions of precarity and indebtedness emerged as dominant features of capitalist subjectivity after the 1970s, it is not before the European sovereign debt crisis erupted in 2009 with the announcement of a dangerously large Greek budget deficit that an active form of governmentality through debt and precarity emerged, involving both states and individuals in its command and deploying new dispositifs such as austerity. How can one account for the emergence of this new form of rule which instills anxiety and guilt in its ‘technologies of the self’? The crisis brought with it a sense of emergency and scarcity of a scale that had not been experienced since the 1970s recession in industrialised countries. For this reason it was the moment that revealed precarity and debt as dominant features in late capitalism, not only at the individual but especially at the state level. These ones had to a certain extent been obscured by good economic conditions which had allowed developed capitalist countries to live in a world of relative abundance and their subjects to thrive through economic growth and debt-fuelled consumption. The feelings of guilt associated with indebtedness and the anxiety associated with precarity were obscured by the blinded hope of a positive future sustained by infinite growth. The crisis, by destroying this hope and acting as a correction, revealed the presence of precarity and debt in late capitalism. In this new era of scarcity the indebted ones are now found “guilty and responsible in the eyes of capital, which has become the Great, the Universal, Creditor” (Lazzarato 2012). The crisis aggravated subjects’ position by preventing their capacity to repay their debt, making their potential vulnerability a reality, destroying any hope of success but rather inclining them to reevaluate their choices and behaviours in order to survive. Before the economic crisis, subjects were governed mainly through some positive affects such as desire, hope, and fulfilment, and inclined to make a project of their own life as consumer-producer in a world of abundance. In the crisis, subjects are inclined to survive “through managing one’s debts and copping with the reduction in social services and other forms of precarity” (O’Shaughnessy 2012). The crisis allowed new mechanisms of governmentality to be deployed, based on these newly revealed subjectivities, engulfing both individuals and states in their command through restriction and sometimes punishment. Notions of scarcity and emergency became embedded in a dominant discourse which called for a state of exception and supported the use of governmental dispositifs such as austerity, even if they bypass democracy or interfere with civic rights (OHCRH 2013). As Douzinas expresses, “in periods of economic growth, the detailed and suffocating regulation of life is accompanied by an apotheosis of individual desire expressed in the proliferation of rights”(Douzinas 2014: 88). The crisis reversed the priorities and therefore “the superficial freedom of the previous period becomes counter-productive” (ibid). Subjects are still free in absolute term, but evolving in an environment where choices have been largely restricted.

3.3 Austerity and the right of the police

What are the implications for states subjected to this global form of command? Before the crisis, a sense of abundance provided national governments with the ability to run large deficits financed by public debt, facilitated by good financial conditions and some solid expectations of positive economic growth. The sovereign debt crisis revealed the difficulty of some countries in repaying their debt. These ones are now subject to the “the moral grasp, evaluative gaze and predictable temporalities of indebtedness” (O’Shaughnessy 2012). They now appear like collective subjects whose morality and grief are solicited by a neoliberal governmentality which constantly reminds its subjects of their sole responsibility in their conditions of indebtedness, and obscures any systemic and external causes. States are

regularly reviewed by peers, financial markets and supranational institutions such as the IMF, the same institutions which diffuse their guidelines on what constitutes sound sovereign debt management and economic policies (Marton 2014: 60). States are constantly threatened to fall into disgrace, to be marginalised and considered as periphery due to these regular reviews which can at any time deem one country unfit in neoliberal terms and unable to repay its debts in the future. They are governed through debt and precarity as much as any other elements in the global capitalist order and this in turn has an impact on their own people, as states “will have to accommodate both the proposals on the global level and the enforcement of such on a national level” (ibid: 39).

What happens when a country is subject to bad reviews on its economic and fiscal health? Austerity, presented as a set of economic policies which aims to reduce government budget deficits, is promoted as the miracle economic recipe that can cure large amounts of sovereign debt. However, its lack of empirical success allows oneself to question its real purpose. Indeed, “quite the opposite has happened in the immediate wake of these measures: the effects of austerity policies are portrayed as more debt, greater class division and added instability” (Tellman 2015: 22), with even some acknowledged violations of human rights (OHCRH 2013). In fact, austerity is much more than just some economic recipe. It is a major dispositif of this new moment of governmentality through debt and precarity. It makes use of the sense of scarcity and emergency in the crisis to present itself as a necessity in the state of exception. It encourages subjects indebted and on the edge of marginalisation to perform a high-speed neoliberalisation which satisfies capitalist logics, by appealing to their anxiety and grief, this way preventing any resistance to its managerial shock therapy. For this, it disseminates discourses and practices and involves institutions inside the capitalist order which recognise monetary orthodoxy and individual responsibility as their core values and promote drastic cuts in welfare states, large privatisation programs and the deregulation of labour market (Charbonneau and Hansen 2013). As a result, austerity “is an aggressive biopolitical correction. It covers every aspect of life from the basics like food, electricity and clothing to health, education, social security and leisure.” (Douzinas 2014). It therefore acts both at the country and the individual levels by its ability to foster a complete restructuring of countries institutions and to breed individual subjects that are fit and proper for capitalist modes of production. Its goal is not, as pretended, to reduce debt, rather to maintain the level of debt more or less constant through roll-overs and all sorts of restructuring operations in order to keep its governmental potential intact for the reproduction of capitalism (Lazzarato 2012, Douzinas 2014). The implications of austerity are much more than just immiseration and increased conditions of precarity and indebtedness, they also encompass an abandonment of democratic values as the public sector is reduced to nil and non-democratically elected technocrats find themselves in charge of ruling states (Athanasiou 2015). The state of exception brought about by the crisis justifies it all. As expressed in the second section of this paper, some countries and institutions enjoy a position of dominance in the global order and hold a crucial role of endorsers of the neoliberal rules by disseminating their codes of conducts. They notably promote austerity measures since the crisis erupted. These elements also stay ready to intervene whenever a subject presents itself as deviant. While austerity acts to breed and manage a particular kind of subjects, conditions of indebtedness and precarity also offer some disciplinary mechanisms in case of resistance to this process of subjectification. Here the triangular relationship between governmentality, sovereignty and discipline is clear, as “police repression, extensive surveillance and the criminalisation of resistance accompany an intensive effort to re-channel conduct”(Douzinas 2014: 88). At the hands of these policing elements, bond markets and monetary mechanisms offer means of pressure (Petry 2013: 18). The European Central Bank

(ECB - when it concerns deviant elements inside the Eurozone) or the IMF can threaten to cut their lines of funding to banks inside the country, or can make their financial assistance conditional on austerity. Finally, dominant states and supranational institutions can use all sorts of diplomatic pressure on their deviant peers. Ironically, some of the same dominant capitalist states have largely escaped the scrutiny of governmentality mechanisms when it concerns their own level of debt. The United States as an example, despite its large deficit when the economic crisis erupted, was allowed to finance this one through emitting large sums of money, in drastic opposition with the rationality of monetary orthodoxy at the core of neoliberal governmentality (Lordon 2010).

4. Case Study: Greece and its sovereign debt crisis Greece and the recent financial mayhem which engulfed the country offer a perfect example of a collective subject governed through debt and precarity. It starts from an early process of subjectification through indebtedness and precarization after the 1970s, to continue with the implementation of austerity as a major dispositif of crisis management, to end with a policing event once Greek people vote for a radical left party.

4.1 The subject construction of Greece as indebted and in precarity Greece comes in the spotlight in 2009 for its large deficit coming at 12.7% instead of 6.7% expected, revealing that previous figures have been falsified by the government in place with the help of Goldman Sachs who acted as a financial advisor (Balzli 2010). The sovereign debt crisis starts in a state of panic and Greek yields surge as creditors start to doubt Greece’s capacity to repay its high level of sovereign debt. Straight away, various actors start giving their prognostics on the situation, trying to identify the root-causes of the crisis. A mainstream narrative emerges which clearly allocates responsibility fully to Greece. German media picture the Greek people as lazy mediterraneans whose profligacy and tendency for corruption allowed for debt to pile-up (Ronzheimer 2010), while supranational institutions accuse the rigidity of the labour market and a lack of competitiveness, affirming that sound macroeconomic policies in Greece and a fight against local corruption could have avoided the crisis (Petry 2013; IMF 2010). Greek prime minister George Papandreaou declares from his side that “the problem we have is home-made […] we Greeks are responsible for putting our own house in order" (Elliott 2010). This narrative will give a justification for the subsequent lack of support from external actors. As an example, IMF director Christine Lagarde will declare in 2012 that Southern Europe has “had a good time”, however “now it’s payback time” (Elliott and Aitkenhead 2012). As the crisis erupts, supranational institutions hasten to declare this one a serious pathology presenting risks of contagion (Petry 2013), that way warning other countries that they are also at risk and creating an environment of fear, anxiety, and increased competition. Overall, one can recognise the first expressions of governmentality through debt and precarity, whereby only the individual causes for indebtedness are highlighted while the systemic and external causes are obscured, and every subject is reminded of its conditions of precarity in the global order.

The underlying causes for a high level of sovereign debt in Greece are much more complex than mainstream discourse affirms, and involve many external actors and systemic effects. As previously explored, capitalist developments and the emergence of a neoliberal governmentality in reaction to the crisis of the 1970s engulfed both individuals and national governments of industrialised countries into an era of debt-fuelled consumption. As Douzinas explains:

Southern Europe is a textbook case of debt’s desire. After entry to the euro, the modernising governments promoted consumption and hedonism as the main way of linking private interests with the common good […] The ‘obscene’ father of psychoanalysis kept telling the Greeks borrow, ‘enjoy’, ‘buy’, live as if this is your last day (Douzinas 2014: 87).

This form of hedonism was further encouraged by the introduction of the euro and the subsequent convergence of national interest rates, allowing Greece to borrow at cheap rates from northern European banks. The profligacy of the Greeks needs therefore to be contextualised inside these developments. In parallel, neoliberal governmentality also expressed itself in the design of the Eurozone (EMU), which inscribed monetary orthodoxy and the criteria of convergence as its core principles, in line with holding markets as universal site of truth (Lucarelli 2011, Petry 2013, Marton 2014). Greece lost its monetary sovereignty, and with it the ability to finance any deficit through money printing, becoming dependent to financial markets and unable to regain competitiveness through external devaluation, therefore more prone to precarity. The design of the EMU also implied an extreme liberalisation to the outside which exposed national economies to market competition and reinforced the logic of precarity inside its zone, instead of promoting cooperation between its members, another expression of neoliberal governmentality (Lordon 2012). After all, local problems of corruption and tax evasion come as secondary factors in the level of Greek public debt (Lucarelli 2011, Petry 2013). One can see how capitalist developments and the emergence of a neoliberal governmentality in reaction to the labour struggle of late 1970s worked hand in hand to create Greece as an indebted subject living in precarity, two features which got revealed by the crisis as this one ended the period of joyful abundance. However, any of these root-causes are obscured as the crisis starts and a new era of scarcity opens. The major issues in this second moment of neoliberal governmentality are the stigmatisation of Greece for its (now) irrational excess and its marginalisation by external actors.

4.2 Self-governance, austerity and other dispositifs of governmentality

As previously mentioned, when the crisis starts the Greek government recognises its own responsibility and promises to take action. Then it votes through parliament various programs of austerity designed to reduce the deficit, encompassing pay freezes for the public sector, an increase in VAT and a pension freeze, at its initiative (Smith 2010). At that moment, Greece positions itself both as a locus of governmentality and a subject of it. Its initial reaction shows that it has already integrated individual responsibility as a core truth of neoliberal governmentality. Its subsequent actions demonstrate how austerity acted as a dispositif and came to be voluntarily chosen as a preferable option by the Greek government and its people. This analysis does not aim at obscuring some opposition inside the government, or a multiplicity of opinions inside the Greek people. Rather, by recognising how in practice Greece is treated as one element of the capitalist order by its peers and other institutions, and how the Greek government acts on behalf of its people by expressing one voice, it inclines to think of Greece as a collective subject which finds itself enmeshed in global governmentality. As the crisis deepens, Greece requests external financial aid. In May 2010, a memorandum is signed with the Troika, the tripartite committee formed by the European Commission, the ECB and the IMF, and other agreements will follow as Greek macroeconomic conditions continue deteriorating (Smith 2010). The local population starts to rebel against implemented austerity measures which deeply impact their living conditions. Nevertheless, every subsequent funding programs of the Troika have in common that they require fresh austerity

measures from Greece. Indeed, as the Greek government seems to lose its ability to auto-correct itself as the population rebels, making the credit lines conditional on the implementation of austerity allows to constrain the government in its choices from the outside. In parallel, greek yields and the notation agencies continue playing their role as dispositifs of governmentality by adding to the pressure on the Greek government and its people (Lindner 2012). Governmentality through debt and precarity combines here some 'technologies of the self' with more authoritarian techniques in order to quicken the subjectification process of Greece towards a neoliberal subject adapted to capitalist requirements. Greece is still free to choose for itself, but any external support will vanish if it refuses the medicine imposed by the sovereign elements of the capitalist order. The rules of the games have been fixed and the state of exception provided by the crisis has inspired their design. Financial markets hasten to adopt the term “periphery” to designate southern Europe, therefore the periphery has invaded the core and Greece’s conditions of precarity are publicly recognised. In parallel, its public debt keeps ballooning as borrowing rates rise and Greece enters a period of deflation, and with it grows the moral imperative of reimbursing it. Note that every time that Greece is on the edge of a default, the eventuality of this one is easily dismissed by its creditors (Petry 2013). In no way possible Greece should loose its indebted character and the major potential of governmentality that lies in it. Instead, more austerity is offered and resistance grows inside the population.

4.3 Syriza: resistance and punishment in the global order

This resistance expresses itself politically as soon as 2012 through a growing popular support for Syriza, a coalition of radical left parties who later registers as a single party. Syriza unveils its Thessaloniki Programme in 2014 and gets elected early 2015 (Henley 2015). Its establishment through democratic means represents a turn in the crisis management of Greece. By bringing a radical left-wing government to power whose program rests principally on a renegotiation of public debt with creditors and the restitution of welfare measures, Greece unsettles the neoliberal establishment in place in the Eurozone and embodies a deviant element inside the capitalist order. Since the neoliberal process of subjectification has failed, now is the time to police the deviant. Just after the elections, a German government official announces that “the Greeks have the right to vote for whom they want. We have the right to no longer finance Greek debt” (Friedrich cited in Aziz 2015). From then, all kinds of authoritarian moves and diplomatic threats are dispensed by the Troika and the creditors of Greece who make use of their position of dominance and sovereignty inside the global capitalist order. As an example, the ECB regularly threatens to cut its main line of funding for Greek banks that desperately need it (Chrysoloras 2015; Barber 2015). Every time Syriza makes concessions during negotiations, the Troika comes up with new punitive demands and austerity measures (Athanasiou 2015). The overall aim of these actions is not to find an agreement and solve Greece’s economic issues, it is to punish and humiliate the Greek government for its radicalism (Athanasiou 2015; Varoufakis 2015). In parallel, these actions reinforce the normative framework of the capitalist order by showing the example and preventing risks of contagion through a strengthening of leftist parties in other countries. The ultimate hit comes in July 2015 after Syriza calls for a referendum on austerity measures requested by the Troika. This proposition represents an attempt to “break with the logics and logistics of austerity and authoritarianism in Europe” (Athanasiou 2015). After a no-vote from the Greek people, creditors and the Troika use all kinds of extreme diplomatic pressures to constrain Greek prime minister Alexis Tsipras to adhere to their demands, in exchange for a desperately needed bailout. Tsipras will finally surrender shortly after (Varoufakis 2015).

Conclusion This paper initially drew upon the work of the autonomist Marxist school on biopolitical capitalism and Foucault’s approach to neoliberalism to observe how late capitalism breeds a certain kind of subject that suits its own logics, a process which is reinforced by a neoliberal governmentality which disseminates its ‘techniques of the self’ and holds the market as sole site of truth. This process of subjectification is also observable on a global scale, as states represent collective subjects that are similarly constructed and managed inside late capitalist order. The paper later argued that a form of global governmentality through debt and precarity emerged in response to the sovereign debt crisis of 2009. By appealing to affects such as anxiety and guilt, debt and precarity are much more than just economic conditions, they form part of subjectivity and impact one’s choices; they therefore hold some potential as ‘technologies of the self’ in Foucauldian terms. Debt and precarity had emerged as dominant features of late capitalism after the labour struggle of the 1970s in industrialised countries, however the following period of economic growth had allowed to conceal these ones and for individual and collective subjects to enjoy a form of hedonist consumption despite their increasingly vulnerable conditions. This might explain why previous autonomist attempts to analyse the process of subjectification inside late capitalism had emphasised the manipulation of desire and other positive passions for the production of entrepreneurial subjects, maximisers of their own human capital. The crisis exposed the reality of debt and precarity, and a sense of scarcity and urgency called for a state of exception and drastic measures to be taken. Inside this second moment of neoliberal governmentality, subjects are still free to choose to act in a certain way, however their modes of conducts and values are permeated by an anxiety of the future and a feeling of accountability towards their creditors. A major dispositif of this governmentality in crisis, austerity normalises indebted and precarious subjects in terms that fit capitalist requirements. In case of a failure of the ‘technologies of the self’ of governmentality, sovereign elements of the global order have at their disposal various authoritarian techniques to police the deviant, as Greece exemplified well. Considering the establishment of this new form of rule since the crisis erupted, what kind of capacity of resistance is left, both to individuals and states? Autonomist thinkers have regularly emphasised that reinserting subjectivity at the centre of an analysis of capitalism not only allowed to better understand capitalist developments, it also offered new hopes of resistance. By reallocating some immanent power to subjects, it recognised new ways of acting together (Hardt and Negri 2001, Hardt 1999). Authors focusing on precarity have claimed from their side that this newly shared condition can potentially reunite diverse subjects under a common banner (Lorey 2010, Gill and Pratt 2008). However, as demonstrated in this essay, precarity coupled with indebtedness have engulfed both individuals and states in a logic of extreme marginalisation and immiseration and have largely reinforced the spirit of competition instead of promoting new forms of cooperation, at least at the states level. In the case of Greece, the refusal of other countries to provide any kind of diplomatic or economic assistance unconditionally to austerity measures, in other words to break with the logic of competition inherent to the Eurozone, had a large impact on Syriza’s capacity of resistance. Even more, Ireland and other countries that had docilely led their people to austerity in the crisis decried the possibility for Greece to escape its similar fate. These dynamics coupled with the resurgence of authoritarian techniques in this new moment of governmentality have shown how difficult it is to resist the process of normalisation towards capitalist logics. In the case of Greece, Syriza’s attempts to emphasise the systemic causes of its large amounts of debt and its recurrent calls for a new spirit of cooperation in Europe have proved to be insufficient. Ultimately, the need for survival and self preservation outweighed the will to say no to austerity.

Bibliography Agamben, G., 2013. “The Endless Crisis as an Instrument of Power: In conversation with

Giorgio Agamben” . Versobooks.com. URL http://www.versobooks.com/blogs/1318-the-endless-crisis-as-an-instrument-of-power-in-conversation-with-giorgio-agamben (accessed 7.31.15).

Agustin, O.G., Ydesen, C., 2013. “Post-crisis perspectives”. Peter Lang.

Alderman, L., 2015. “Explaining the Greek Debt Crisis and What It Means for the Eurozone”. The New York Times. http://cn.nytimes.com/world/20150629/c29greekdebt-explainer/en-us/ (accessed 9.8.15)

Åslund, A., 2009. “Ukraine’s Financial Crisis, 2009”. Eurasian Geography and Economics 50, 371–386. doi:10.2747/1539-7216.50.4.371

Athanasiou, A., 2014. “Precarious Intensities: Gendered Bodies in the Streets and Squares of Greece”. Signs, Vol. 40, No. 1 (Autumn 2014), pp. 1-9.

Athanasiou, A. 2015 “The right to democratic dissent”. Greek Left Review.

Aziz, J., 2015. “Euro QE And The Rise Of SYRIZA” . URL http://www.pieria.co.uk/articles/euro_qe_and_the_rise_of_syriza (accessed 9.8.15).

Balibar, E., 2013. “A new Europe can only come from the bottom up” . openDemocracy. URL https://www.opendemocracy.net/etienne-balibar/new-europe-can-only-come-from-bottom-up (accessed 7.27.15).

Balibar, E., 2010. “Europe is a dead political project”. the Guardian. URL http://www.theguardian.com/commentisfree/2010/may/25/eu-crisis-catastrophic-consequences (accessed 7.27.15).

Balzli, B., 2010. “Greek Debt Crisis: How Goldman Sachs Helped Greece to Mask its True Debt”. Spiegel Online. http://www.spiegel.de/international/europe/greek-debt-crisis-how-goldman-sachs-helped-greece-to-mask-its-true-debt-a-676634.html (accessed 9.8.15)

Barber, L., 2015. “ECB reportedly ending emergency loans to Greece” . URL http://www.cityam.com/218937/greek-debt-crisis-european-central-bank-reportedly-ending-ela-emergency-loans-greece (accessed 9.8.15).

Barnett, C., 2005. “The consolations of “neoliberalism””. Geoforum, 36(1) pp. 7–12.

Behrend, B., 2015. “The Supranational Governmentality of Neoliberalism: An Analysis of the Governing Principles of Troika Programs for Greece”. Politikon: IAPSS Political Science Journal, 26.

Bussolini, J., 2010. “What is a dipositive?” Foucault Studies, No. 10, pp. 85-107

Cato, 2015. “Greek crisis reveals Eurozone as “neoliberal disciplining device” says economist MEP”. Molly Scott Cato MEP. URL http://mollymep.org.uk/2015/06/30/greek-crisis-reveals-eurozone-as-neoliberal-disciplining-device-says-economist-mep/ (accessed 7.21.15).

Charbonneau, M., Hansen, M.P., 2013. “Debt, neoliberalism and crisis: interview with Maurizio Lazzarato on the indebted condition”. URL https://www.academia.edu/5980223/Debt_neoliberalism_and_crisis_interview_with_Maurizio_Lazzarato_on_the_indebted_condition (accessed 9.8.15).

Chrysoloras, J.B.N., 2015. “ECB Threatens to Choke Off Funding to Greece Before Election”. Bloomberg.com. URL http://www.bloomberg.com/news/articles/2015-01-13/ecb-warning-to-greece-on-funding-deploys-tactic-honed-in-crisis (accessed 9.8.15).

Cromby, J., Willis, M.E.H., 2014. “Nudging into subjectification: Governmentality and psychometrics”. Critical Social Policy 34, 241–259. doi:10.1177/0261018313500868

Davidson, N., 2015. “Neoliberalism against capitalism?”. libcom.org. URL http://libcom.org/news/neoliberalism-against-capitalism-neil-davidson-30062015 (accessed 7.30.15).

Douzinas, C., 2014. “Notes towards an analytics of resistance”. New Formations. doi:10.3898/Newf.83.05.2014

Elliott, L., 2010. “No EU bailout for Greece as PM promises to “put house in order.”” The Guardian. URL http://www.theguardian.com/business/2010/jan/28/greece-papandreou-eurozone (accessed 8.22.15).

Elliott, L., Aitkenhead, D., 2012. It’s payback time: don’t expect sympathy – Lagarde to Greeks. The Guardian. URL http://www.theguardian.com/world/2012/may/25/payback-time-lagarde-greeks (accessed 8.22.15).

Fields, D., 2014. “The Urban Fiscal Crisis as Neoliberal Shock Therapy: A Cartalist Fiscal-Sociological Approach.” The Hampton Institute http://www.hamptoninstitution.org/neoliberal-shock-therapy.html#.VfKnY85H00o (accessed 7.30.15).

Forster-Smith, C., 2015. “Debt, Governmentality, and the Neoliberal City”. Paper to be presented at the Western Political Science Association 2015 Annual Meeting. URL http://wpsa.research.pdx.edu/papers/docs/Debt,%20Governmentality,%20and%20the%20Neoliberal%20City_Forster-Smith_WPSA.pdf (accessed 7.30.15).

Foucault, M., 1978. “The History of Sexuality: The Will to Knowledge”. Allen Lane.

Foucault, M., 2008. “The birth of biopolitics. Lectures at the College de France, 1978-79”. Palgrave MacMillan.

Foucault, M., 1990. ““Part Five: Right of Death and Power over Life” The History of Sexuality Volume 1: An Introduction”. Trans. Robert Hurley. New York: Vintage Books, 1990. 135-159. Print.

Fougner, T., 2008. “Neoliberal Governance of States: The Role of Competitiveness Indexing and Country Benchmarking”. Millennium-journal of International Studies 37, 303–326. doi:10.1177/0305829808097642

Gill, R., Pratt, A., 2008. “In the Social Factory? Immaterial Labour, Precariousness and Cultural Work”. Theory Culture Society 25, 1–30. doi:10.1177/0263276408097794

Granitsas, A., 2008. “UPDATE: Greece Plans EUR28 Billion Bank Bailout Package” - Fin Min . FXStreet. URL http://www.fxstreet.com/news/forex-news/article.aspx?storyid=cac1ad4a-747d-4f7e-9483-1fdaa4f42428 (accessed 6.25.15).

Gray, N., Porter, L., 2014. “By Any Means Necessary/ Urban Regeneration and the “State of Exception” in Glasgow’s Commonwealth Games”. Antipode 00, 0.

Guide for collective survival in times of mass destruction , 2015 . libcom.org. URL http://libcom.org/news/guide-collective-survival-times-mass-destruction-10072015 (accessed 7.30.15).

Hardt, M., n.d. 1999 “Affective labor”, Boundary 2, 26(2): 89-100. Hardt, M., Negri, A., 2001. Empire. Harvard University Press, Cambridge, Mass. ; London :

Harvey, D., 2007. A Brief History of Neoliberalism. Oxford University Press Inc., New York Henley, J., 2015. “Greece elections: anti-austerity Syriza party sweeps to stunning victory”.

The Guardian. URL http://www.theguardian.com/world/2015/jan/25/greece-election-vote-austerity-leftwing-syriza-eu (accessed 7.30.15).

IMF, 2010. “Greece: Staff Report on Request for Stand-By Arrangement”. International Monetary Fund. URL https://www.imf.org/external/pubs/ft/scr/2010/cr10110.pdf

IMF, 1996. “Confronting Budget Deficits, Economic Issues 3”. International Monetary Fund URL http://www.imf.org/external/pubs/ft/issues3/

Joseph, J., 2009. “Governmentality of What? Populations, States and International Organisations”. Global Society 23, 413–427. doi:10.1080/13600820903198685

Kanter, J., Kitsantonis, N., 2015. E.C.B. Agrees to Extend Lifeline to Athens. The New York Times. URL http://www.nytimes.com/2015/06/20/business/international/ecb-greece-debt-meeting.html (accessed 6.25.15).

Katsambekis, M.G., Kioupkiolis, D.A., 2014. “Radical Democracy and Collective Movements Today: The Biopolitics of the Multitude versus the Hegemony of the People”. Ashgate Publishing, Ltd.

Kelly, M.G.E., 2010. “International Biopolitics: Foucault, Globalisation and Imperialism”. Theoria 57, 1–26. doi:10.3167/th.2010.5712301

Kiersey, N.J., 2011. “Everyday neoliberalism and the subjectivity of crisis: post-political control in an era of financial turmoil”. Journal of Critical Globalisation Studies 4, 23–44.

Kiersey, N.J., 2009. “Neoliberal Political Economy and the Subjectivity of Crisis: Why Governmentality is Not Hollow”. Global Society 23, 363–386. doi:10.1080/13600820903198644

Kiersey, N.J., Weidner, J.R., 2009. “Editorial Introduction”. Global Society 23, 353–361. doi:10.1080/13600820903198602

Kinsman, G., 2004. “The Politics of Revolution: Learning from Autonomist Marxism”. El Kilombo Intergaláctico. URL http://www.elkilombo.org/the-politics-of-revolution-learning-from-autonomist-marxism/ (accessed 7.25.15).

Krippner, G.R., 2012. “Capitalizing on crisis: The Political Origins of the Rise of Finance”. Harvard University Press.

Kyriakopoulos, L. et al., 2014. “Becoming Precarious in the age of neo-liberal bio-politics.” URL http://teachingthecrisis.net/wp-content/uploads/2014/03/Greece_Report.pdf (accessed 7.25.15).

Lamarche, P., Rosenkrantz, M., Sherman, D., 2011. “Reading Negri: Marxism in the Age of Empire”. Open Court Publishing.

Larner, W., 2000. “Neo-liberalism: Policy, Ideology, Governmentality”. Studies in Political Economy 63.

Lazzarato, M., 2013. Governmentality in the current crisis. Generation Online. URL http://www.generation-online.org/p/fp_lazzarato7.htm (accessed 7.28.15)

Lazzarato, M., 2012. “The Making of the Indebted Man: Essay on the Neoliberal Condition”, Reprint edition. ed. MIT Press, Los Angeles, CA.

Lazzarato, M., 2006. “Biopolitics and bioeconomics A politics of multiplicity”. Generation Online. http://www.generation-online.org/p/fplazzarato2.htm (accessed 7.28.15)

Lindner, F., 2012. “How Rating Agencies are aggravating the Euro Crisis”. Social Europe. URL http://www.socialeurope.eu/2012/03/how-rating-agencies-are-aggravating-the-euro-crisis/ (accessed 8.28.15)

Lissovoy, N.D., 2014. “Education and Emancipation in the Neoliberal Era: Being, Teaching, and Power”. Palgrave Macmillan.

Lordon, F., 2012. “La fausse solution des eurobonds.” La pompe à Phynance. URL http://blog.mondediplo.net/2012-06-01-La-fausse-solution-des-eurobonds (accessed 6.17.15)

Lordon, F., 2010. “Au-delà de la Grèce : déficits, dettes et monnaie.” La pompe à Phynance. http://blog.mondediplo.net/2010-02-17-Au-dela-de-la-Grece-deficits-dettes-et-monnaie (accessed 6.17.15)

Lorey, I., 2011. “Governmental Precarization”. EIPCP. URL http://eipcp.net/transversal/0811/lorey/en (accessed 7.23.15)

Lorey, I., 2010. Becoming Common: Precarization as Political Constituting Political-Cultural Queerings. e-flux. URL http://www.e-flux.com/journal/becoming-common-precarization-as-political-constituting/ (accessed 7.23.15)

Lorey, I., 2006. “Governmentality and Self-Precarization On the normalization of cultural producers”. EIPCP. URl http://eipcp.net/transversal/1106/lorey/en (accessed 7.23.15)

Löwenheim, O., 2008, “Examining the State: a Foucauldian perspective on international “governance indicators””, Third World Quarterly, 29:2, 255-274.

Lucarelli, B., 2011. “German neomercantilism and the European sovereign debt crisis”. Journal of Post Keynesian Economics 34, 205–224. doi:10.2753/PKE0160-3477340202

Marton, V., 2013. “The euro area crisis and alternations in global economic governance”. Student Theses. URL http://studenttheses.cbs.dk/bitstream/handle/10417/4193/vera_marton.pdf?sequence=1 (accessed 7.28.15)

Mitropoulos, A., 2005. “Precari-Us?” EIPCP URL http://eipcp.net/transversal/0704/mitropoulos/en (accessed 8.1.15)

Morales J, et al. 2013. “State privatization and the unrelenting expansion of neoliberalism: The case of the Greek financial crisis”. Crit Perspect Account, http://dx.doi.org/10.1016/j.cpa.2013.08.007

Mylonas, Y., Kompatsiaris, P., nd. Pathologizing Politics: The Making of the Neoliberal Subject during the Greek Crisis. URL https://www.academia.edu/6202916/Pathologizing_Politics_The_Making_of_the_Neo

liberal_Subject_during_the_Greek_Crisis_co-authored_with_Panos_Kompatsiaris_ (accessed 8.1.15)

Neal, A.W., 2009. “Rethinking Foucault in International Relations: Promiscuity and Unfaithfulness”. Global Society 23, 539–543. doi:10.1080/13600820903198958

Nikolas Rose, P.M., 2010. “Political Power beyond the State: Problematics of Government”. The British journal of sociology 61 Suppl 1, 271–303. doi:10.1111/j.1468-4446.2009.01247.x

OHCRH, 2013. “Report of the United Nations High Commissioner for Human Rights on austerity measures and economic and social rights”. OHCRH. URL http://www.ohchr.org/Documents/Issues/Development/RightsCrisis/E-2013-82_en.pdf

Olssen, M., 2004. “Foucault and Marxism: Rewriting the Theory of Historical Materialism”. Policy Futures in Education 2, 454–482.

O’Shaughnessy, M., 2012. “Lazzarato and the governmental power of debt: La Fabrique de l’homme endetté or The Making of Indebted Man”. La France et la Crise. URL http://lafranceetlacrise.org/2012/08/23/lazzarato-and-the-governmental-power-of-debt-la-fabrique-de-lhomme-endette-or-the-making-of-indebted-man/ (accessed 8.1.15)

Petry, J., 2013. “Constructing the Eurozone Crisis: A Tale of PIIGS, Debt, and Austerity”. Academia. URL https://www.academia.edu/5361157/Constructing_the_Eurozone_crisis_A_tale_of_PIIGS_debt_and_austerity (accessed 8.3.15)

Radice, H., 2011. “Confronting the crisis: a class analysis” The Crisis This Time. The Socialist Register. Vol 47.

Rizvi, A., 2012. “Freedom, Power, and Capitalism: From Disciplines to Biopower”. Academia. URL https://www.academia.edu/1392438/Freedom_Power_and_Capitalism_From_Disciplines_to_Biopower_ (accessed 8.4.15).

Ronzheimer, P., 2010. “BILD with the broke Greeks - Crisis what crisis business as usual in Greece”. BILD.de. URL http://www.bild.de/news/bild-english/what-crisis-business-as-usual-in-greece-12332236.bild.html (accessed 9.2.15).

Rosenow, D., 2009. “Decentring Global Power: The Merits of a Foucauldian Approach to International Relations”. Global Society 23, 497–517. doi:10.1080/13600820903198891

Schram, S.F., 2015. “The Return of Ordinary Capitalism: Neoliberalism, Precarity, Occupy”. Oxford University Press.

Selmeczi, A., 2009. ““… we are being left to burn because we do not count”: Biopolitics, Abandonment, and Resistance”. Global Society 23, 519–538. doi:10.1080/13600820903198933

Sharma, A., Gupta, A., 2009. “The Anthropology of the State: A Reader”. John Wiley & Sons.

Smith, H., 2010. “Greece approves sweeping austerity measures”. The Guardian. URL http://www.theguardian.com/world/2010/may/06/greece-crisis-approves-austerity-measures (accessed 9.2.15).

Stavrakakis, Y., 2013. “Debt Society: Greece and the Future of Post-democracy”. Radical Philosophy. URL http://www.radicalphilosophy.com/article/debt-society (accessed 8.2.15).

Stern, D., 2009. Economic Crisis Sweeps Eastern Ukraine. The New York Times. URL http://www.nytimes.com/2009/04/08/world/europe/08ukraine.html (accessed 9.2.15).

Tellman, U., 2015. “Austerity and scarcity/ About the limits and meanings of liberal economy”. Ephemera/ theory & politics in organization. 15(1)/ 21-40.

Varoufakis, Y., 2015. « Leur seul objectif était de nous humilier ». Le Monde Diplomatique. Août 2015. https://www.monde-diplomatique.fr/2015/08/VAROUFAKIS/53506 (accessed 8.13.15).

Vrasti, W., 2013. “Universal but not truly “global”: governmentality, economic liberalism, and the international”. Review of International Studies 39, 49–69. doi:10.1017/S0260210511000568

Weidner, J.R., 2009. “Governmentality, Capitalism, and Subjectivity”. Global Society 23, 387–411. doi:10.1080/13600820903198719

Xypolia, I., 2012. “Sorry, folks..the wake is over”. London Progressive Journal. URL http://londonprogressivejournal.com/article/view/1140 (accessed 9.6.15).

Zizek, S., 2010. “A Permanent Economic Emergency”. New Left Review, II 85–95. Zizek, S., 2001. “Have Michael Hardt and Antonio Negri rewritten the communist manifesto

for the twenty-first century?” Rethinking Marxism, Volume 13, Number 3/4

‘The future of international law is domestic’: based on their record since 1900, what factors lead to the establishment of

successful domestic criminal trials for genocide?

Leah Owen

Abstract

Genocide prosecutions by domestic courts represent a significant, but understudied, practice in the past hundred years. By conducting a comprehensive examination of all such tribunal structures according to four criteria (political environment, legal basis, timescale, endurance of trial outcome), I argue that they are more common (twenty-one different tribunal structures over five continents) than the literature suggests, that over four fifths reached enduring legal verdicts and that they fail and succeed for a similar set of reasons, traceable to their establishment. Prior inclusion of genocide in penal codes, swift trials commencement bolstered by international technical support, and two to three year durations (befitting complex murder trials) are associated with internationally recognised, lasting results, while failures lead to collapsed trial systems and annulled or internationally criticised verdicts. Despite foundational flaws, domestic genocide tribunals are an important and internationally established contribution to international justice.

1. Introduction If genocide is the ‘crime of crimes’ (Schabas, 2000), then the response should be ‘the trial of trials’. While genocide was pioneered as an international crime (Barrett, 2010), and has often been prosecuted in international fora such as the International Criminal Tribunals for Yugoslavia and Rwanda (ICTY and ICTR), it has also been extensively addressed in domestic settings. More numerous than international tribunals, these have several advantages - their ability to try larger numbers of perpetrators (Riedel, 2006), document genocide and provide closure for victim communities (Jarvis, 2012), and counter revisionist/denialist arguments (Balint, 2013). Slaughter and Burke-White, noting this, suggest that ‘the future of international law is domestic’ (2006, p352). Domestic genocide tribunals are, however, largely understudied outside specific country studies (particularly using systematic and comparative approaches). Such trials are repeatedly - incorrectly - held up in the media as the first of their kind (Boulet, 2009; Goldston, 2013; Independent, 2014), demonstrating the lack of popular awareness of this field. This dissertation will, therefore, attempt to fill a gap in the literature by undertaking a comparative analysis of all genocide trials held since 1900 (identified through a broad literature survey, selecting key trials where a country undertook numerous prosecutions). It will do so not only to assess their extent and distribution, but also to identify the common elements to their success, focusing on their foundations and the sociopolitical environment. To begin with, it will identify three key factors for tribunal foundation. These are the trial’s background (the sociopolitical environment that trials were established in: political supporters and opponents of trials taking place, the state of the judicial system, and any international support), the trial’s legal basis (the laws empowering the state to undertake prosecutions for genocide, and the specific identification of crimes to be charged), and the timescale (the delay until a trial began, and its duration until a verdict). It will then analyse these with reference both to each other, and to the trial’s overall ‘success’, to identify common causes for success and failure. Rather than trial fairness, ‘success’ is here understood as a trial’s endurance. ‘Successful’ trials were enacted speedily, reaching verdicts that were not overturned; ‘unsuccessful’ ones suffered from shaky legal foundations, delayed proceedings, defendants dying before the verdict, or annulments due to flaws in tribunal construction. This dissertation will conclude by attempting to develop a generalised conception of the issues faced by domestic tribunals (though they may prove too divergent to do so), the optimum circumstances for their success, and suggestions for further research on this topic. 2. Literature review Given pressures of space, time, and the broad scope of this dissertation, this literature review will have to be selective, focusing on literature illustrating the overall ‘shape’ of the field, and key issues within it. Analysis of literature on specific domestic genocide prosecutions will constitute the bulk of this dissertation, but it is worth sketching out some of the literature, particularly its availability, in advance. Some cases have received extensive academic analysis (Clark (2010) and Schabas (2005) on Rwanda, Wittman (2008) and Bloxham (2001) on West Germany, and

Tiba (2013) and Haile-Mariam (1999) on Ethiopia), while others have received less, often due to inaccessible archives or poor trial documentation (Dadrian and Akçam (2011), and Balint (2013) on Armenia; Artucio (1979) on Equatorial Guinea), and others, like the ‘Kravica trial’ in Bosnia (Strippoli, 2009), remain understudied. (I)NGOs provide other accounts, especially when trials are comparatively ‘minor’ (as in United Nations (2000) and OSCE (2010) digests on Kosovan trials), or because trials are ongoing (as in Human Rights Watch (HRW, 2013) and the International Justice Monitor (2015) reports on Efraín Rios-Montt’s trial). Single-case coverage is, therefore, widespread but uneven. These accounts often provide mixed assessments of prosecutions, noting the success and strength of their structure while critiquing their delays, questionable legal basis, and damaged infrastructure. This kind of appraisal can be found in Jarvis (2012) and Hinton (in Boulet, 2009) on Cambodia, Tiba (2013) and Haile-Mariam (1999) on Ethiopia, and Clark (2010) and Schabas (2005) on Rwanda. Harsher criticism of shaky legal foundations can be seen in US State Department reports on Croatia (1998) and Pettai and Pettai on the Baltic states (2014). Comparative literature, however, is considerably rarer. Kissi’s (2006) comparison of prosecutions in Ethiopia and Cambodia, and Maogoto’s (2013) in Ethiopia and Ottoman Turkey, both note the flaws in each process, but also their symbolic value and the importance of visible efforts towards accountability. Broader or overview-based literature is more limited still. Simon’s assessment of the ‘Laws of Genocide’ (2007), and Bloxham and Pendas’ ‘Punishment as Prevention’ (2010) both focus almost exclusively on international developments and paradigms, only mentioning domestic legal structures to dismiss their lack of scope or necessary distance. Authors who do cover them are usually brief. Quigley (2006) offers a non-exclusive list and examination of domestic prosecutions, briefly noting their potential deterrent effect and legitimacy for victims, but is sceptical about the potential for political issues to delay and subvert trial efforts. Schabas (2000) offers a (different, also incomplete) list of domestic genocide prosecutions, as a small fraction of his broader analysis. Surveying (rather than comparing) the trials, he highlights the ‘international chorus of condemnation’ for cases such as Rwanda, given the ‘inexperience’ of the lawyers (p390-1). By focusing on ‘inexperience’ rather than ‘bad faith’ however, he emphasises foundations, rather than wilful unfairness, as a cause for trial problems. Jones (2006) is similarly spare, spending less than two pages discussing a handful of trials, stressing their failures and limited scope (p368-370). He observes that pre-existent legal structures can make prosecutions more feasible, and that national prosecutions can promote public catharsis, but that ‘perpetration of genocide on a national territory often correlates with under-developed and compromised legal institutions’ (p368). He also cites the more ‘expansive and inclusive’ legal definitions of genocide (particularly in inclusions of political victim groups) in domestic trials as a ‘course for developments at the international level’ (p370), resulting in successful trials. In Henham and Behrens’ edited volume on genocide, the section on ‘The International and Domestic Prosecution of Genocide’ discusses domestic prosecutions in only one of six chapters: Bates (2007), discussing the Extraordinary Chambers in the Courts of Cambodia (ECCC) focuses on the long delay between genocide and trial, difficulties in legal classification, lack of expertise and resources, and questionable long-term benefits of carrying

out trials. Nonetheless, he contrasts its ‘over-ambitious’ functioning with its ‘powerful symbolic effect’ (p195). Quigley and Schabas highlight significant legal flaws in tribunal foundations, especially compared to more robust international prosecutions. Bates’ and Jones’ more political approaches, by contrast, present trials as flawed but potentially positive expressions of domestic political judicial processes. Together, both analyses highlight the importance of foundational issues to the successful progress of these tribunals, but are weakened by their incompleteness and lack of significant comparative research. While often prescriptive (Stahn, 2011; Williams, 2011), rather than descriptive/comparative, the literature on ‘positive complementarity’ and ‘hybrid trials’ also stresses the importance of proper legal foundations, documentation and case validation. In short, literature systematically comparing domestic genocide tribunals is surprisingly scarce and uneven in its coverage, typically presenting it as a relatively minor phenomenon and adopting a broadly critical approach (particularly on legal capacity in post-genocidal states). It does suggest, however, that national genocide prosecutions represent a flawed but important process, underlining the importance of a systematic analysis across case studies to determine what constitutes successful trial foundations. 3. Case study assessment criteria

This dissertation will begin by identifying all cases in which domestic courts have brought charges of genocide or (in cases before the 1948 Genocide Convention) genocide-like crimes, directed against their own nationals, since 1900. This will be based on Schabas’ and Quigley’s lists, noted above, supplemented with data from the database of TRIAL, a Swiss NGO tracking prosecutions for major crimes including genocide. This approach will include ‘false positive cases’, where genocide charges were issued but crimes against humanity charges might have been more appropriate. It will not include domestic trials of foreign nationals (such as the Eichmann trial in Israel, or the Munyaneza trial in Canada), since these encounter a different set of more international issues, or cases where initial charges were made, but failed to reach trial (such as Australia, Canada, and Mexico, discussed further in Part 7). This dissertation will then assess the case studies with reference to the four following criteria, derived from the literature review. 3.1 Trial background

This examines the political situation in the prosecuting country before the trial took place, paying particular attention to the state of the judicial system and lingering political power of defendants. Legal systems may be neglected or damaged during conflicts, with adverse effects on states’ ability to conduct fair trials. In other cases, perpetrators may have gained support since the genocide took place, complicating efforts to try them (as in Guatemala). Identifying common issues in trial setup will therefore be a key concern.

3.2 Legal basis

This will be an examination of the laws that the accused were tried under, with a particular focus on whether laws predated the crime or encountered issues of retroactivity and nullum crimen sine lege (‘no crime without an existing statute’), and the degree to which the actions of the accused fit the definition of genocide. 3.3 Trial timescale

This examines the degree of delay between when trials could be launched against perpetrators, and when they actually began. Long delays led to illegitimate long-term detention of suspects (some Rwandan genocide suspects were in 2014 reportedly still awaiting trial from their 1994 arrest, for example (US State Department, 2015)), the deaths of suspects in custody (as in Ethiopia), and the loss of evidence - making speedy trials preferable for both suspects and victims. At the same time, over-hasty trials by resource-strapped judiciaries were often compromised in fairness and capacity. Once commenced, trials that dragged on due to lack of capacity or legal basis disputes (as in Guatemala or Ethiopia), risked losing national credibility, but lengthy trials were often unavoidable, due to the complexity of cases, requiring a balance between speed and deliberation. 3.4 Outcome of trial

If trials were overturned, discontinued early, or fell apart due to the natural death of the defendant or lack of political support, this would be an ‘unsuccessful’ trial. If they led to enduring, well-regarded results, this would be ‘success’. While trials can be annulled or restarted for legitimate reasons, trials with a high incidence of legal difficulties and overturned convictions traceable to their inceptions were, in some sense, a ‘failure’, but over-zealous trials risked being identified as ‘show trials’ - also ‘failures’. 3.5 ‘Trial quality?’ This research plan consciously does not assess the ‘quality’ of individual trials - standards of evidence, independence of the judiciary, rights of the accused and of witnesses, and so on. Given the large numbers of trials, each requiring country-specific legal expertise (including local languages) to properly assess, together with poor (as in the Macías Nguema trial (Artucio, 1979)) or sealed (such as Turkish documents on the Armenian genocide (Balint, 2013)) documentation, this sort of analysis is beyond the scope of this essay. Additionally, as mentioned above, while trial quality is important, fair trials cannot occur without a solid foundation. Having assessed cases individually, we will then undertake comparative analysis on each criterion (and between criteria). While these are qualitative assessments of (sometimes contradictory) trial literature, we will attempt to identify common issues that affected different domestic genocide tribunals. 4. Case studies

This section reviews the sources outlined above - Schabas (2000, p417-427), Quigley (2006, p23-49), the TRIAL database, and other news and NGO sources - to identify different domestic tribunal structures. Where multiple similar trials took place, as in the Baltic states

(Liivoja, 2013), or with the UNWCC, this list combines them and takes representative samples. One fact is immediately notable: twenty one genocide tribunals took place across five continents over the past hundred years. This highlights an issue seldom raised in the literature - that the domestic prosecution of genocide is a widely established and large-scale phenomenon, vastly outnumbering internationalised prosecutions. 4.1 Turkey - 1919

These were Ottoman trials of government personnel involved in the 1915 Armenian genocide. Background Unusually, the prosecuting group was not a representative of the targeted group, but a majority regime. Despite domestic political tensions, judicial and political infrastructure was relatively intact (though turbulent) after the war (Balint, 2013). Legal basis The trials predated the concept of genocide, instead being based on pre-existent military/penal law with a (retroactive, but in line with Ottoman legal thinking) 1918 ‘Temporary Law’ to establish tribunal structures (Dadrian and Akçam, 2011). Timescale Formally initiated on 10 December 1918 by executive order, trials began promptly, and were fairly speedy; the major ‘Responsible Secretaries and Delegates’ trial spanned June 1919 to January 1920, for example (p106-127). Results Early trials proceeded smoothly, albeit with executive interference to stave off revolt (p127). Growing judicial non-cooperation and lenient sentencing (motivated by nationalist sentiments), however, led to cessation of trials and an Amnesty Law in March 1923. 4.2 West Germany - 1945-1960s Along with international courts, West Germany also prosecuted Nazi génocidaires. This essay will focus on West German genocide trials up to the 1960s. Background Postwar Allied support in rebuilding Germany (including the judiciary) favoured anti-communist rehabilitation over legal accountability (Bloxham, 2001). There was significant judicial bias against prosecutions of ‘middlemen’, in favour of small numbers of more notorious Nazis (Wittman, 2008). Legal basis Germany added genocide into its penal code in 1954, but did not apply it retroactively, instead using ‘regular’ murder charges, drastically limiting trial effectiveness (Bennet, 2013). Wittman ascribes this to prosecutorial preference for trying sadistic acts of killing rather than the broader organisation of genocide, and fear among German jurists that they too would be prosecuted, as in the ‘Judges Trial’.

Timescale Trials spanned the twentieth century, albeit petering out due to the statute of limitations on many non-murder crimes (Wittman, 2008). Trial lengths varied widely, though major delays in prosecuting cases meant that they seldom succeeded (Bennet, 2013). Results Limited popular and legal support for prosecutions of Nazis meant that trial attempts largely failed. Bennett notes only ‘912 murder cases’ (p118) (not all for genocide) were undertaken, with many more dropped for lack of evidence or willingness - Wittman notes this was particularly desultory compared with contemporary legal pursuit of German communists. 4.3 Poland/UNWCC - 1947 Many 1940s war crimes cases were supported by the United Nations War Crimes Commission (UNWCC); this study will focus on the Polish trial of Rudolf Höss, commandant of Auschwitz death camp. Background Trial preparation began during the war, as Allied governments submitted charge files on high-level war criminals. The Polish judiciary was significantly damaged following the war, but was being rebuilt with Soviet support (Crowe, 2013). Legal basis The trial was based on the 1943 War Crimes Responsibility Decree and the 1932 Polish Criminal Code (that is, not solely on retroactive law). A UNWCC trial appraisal noted its ‘oblique’ approach to the recently-developed concept of genocide, but that it had proven it successfully (UNWCCb, 1948, p24-6). Timescale After the UNWCC-sponsored indictment of Höss in June 1944 (UNWCC, 1944), he was captured by the British in March 1946 and handed over to Poland’s Supreme National Tribunal in May. His trial lasted 11 - 29 March 1947, and he was executed on 16 April. Other UNWCC trials took years to properly begin, while others began so speedily that there was barely time to prepare defences (Crowe, 2013). Results Höss did not appeal for leniency, and subsequent UNWCC case review noted no particular issues with the case. Only a minority of UNWCC charges led to trials (Plesch and Sattler, 2014), and Ellis finds that fair trial standards were not always upheld (Ellis, 2014), but that overall, in Poland and elsewhere, they did run fairly smoothly. 4.4 Cambodia - 1979

The People’s Revolutionary Tribunal (PRT) was the trial for genocide of Khmer Rouge leaders Pol Pot and Ieng Sary, by the People’s Republic of Kampuchea (PRK), the Vietnam-backed successor regime. Background The trial was held shortly after the capture of Phnom Penh, while fighting was still ongoing. The Khmer Rouge had significantly damaged Cambodian judicial systems and targeted lawyers - of ‘legally trained personnel from the pre-1975 period, only seven remained’ alive

or in the country, although Vietnam provided significant legal and personnel support to the trial (Fawthrop and Jarvis, 2004, p40-41). Legal basis Cambodia had ratified the Genocide Convention in 1950, but this was only given domestic effect by the PRK’s 1979 Decree Law No. 1. Schabas describes it as an ‘idiosyncratic definition of genocide closer to crimes against humanity’ (2001a, p472), while Luftglass notes that it was ‘crafted to virtually ensure the guilt of the defendants’ (2004, p903). Trial timescale The trial began 7 months after the fall of Phnom Penh to PRK/Vietnamese forces, on 15 August 1979, concluding on 19 August. Results Both defendants were convicted, in absentia. The trial was described as a ‘show trial’ and ‘farcical’ (Luftglass, 2004 p903) owing to its rapid progress, poor trial quality, and restrictions on defence strategy. Others were more positive; Jarvis highlights its role in documenting the Khmer Rouge (Jarvis, 2012), while Hinton notes that it provided ‘a sense of redress’ for Cambodians (in Boulet, 2009). 4.5 Equatorial Guinea - 1979

This was the trial of Macias Nguema, the former dictator of Equatorial Guinea, for charges including genocidal persecution during his 1967-1979 leadership. Background The trial occurred after a military coup by disaffected officials. This, combined with severe poverty and institutional neglect during Nguema’s rule, left the legal system in disarray: the 1973 Constitution created a ‘legal vacuum’ by annulling previously inherited laws from Spain, no formal trials had taken place for several years, and lawyers had faced particular regime persecution (Artucio, 1979, p18). Legal basis Equatorial Guinea, not a Genocide Convention signatory, used its text as a general guide. Artucio noted that the prosecution did little to prove specific charges of genocide beyond political massacres and ethnic discrimination, criticising the defence’s failure to challenge this (p31). Timescale The Special Military Tribunal opened on 24 September 1979, shortly after the coup (3 August). It convicted Macias on 29 September, with the sentence of execution carried out that day (with no chance for appeal or consideration). Results The trial faced considerable criticism. Artucio criticised the ‘obvious errors’ in law and over-speedy militarised nature (p56), while acknowledging its significant achievements given the ‘legal vacuum’ it inherited. Liniger-Goumaz suggests its main purpose was to ‘exorcise [Macías’ opponents’] own crimes’ (Liniger-Goumaz, 1987, p31)

4.6 Bolivia - 1986-1993

This was the trial of Bolivian leader General Garcia Meza, for (among other charges) ordering the murder of an opposition party’s leadership in July 1980. Background Garcia Meza was overthrown in 1981. HRW ascribed delays to case complexity, unrelated political turmoil, and political interference from Garcia’s supporters, rather than a damaged legal system (HRW, 1992). Legal basis Bolivia had signed the Genocide Convention in 1948, and had domestic legal genocide provisions. Quigley notes that killings (of politicians and intellectuals) were not enacted against a legally protected group (2006, p41); HRW argued that this departure was rhetorical, meant to ‘recognise the [crime’s] special gravity’ (p8). Timescale Garcia Meza was prosecuted for crimes occurring in January 1981. His trial began with a Congressional Indictment in February 1986, and after several halts, concluded in April 1993. HRW described the trial’s process as ‘agonisingly slow’ owing to political interference by Garcia’s allies (p3). Results Garcia was tried in absentia, having fled to Brazil, but was extradited back into Bolivian custody in March 1995 (Associated Press, 1995); the resulting conviction has not been overturned or challenged. 4.7 Romania - 1989

This was the trial of Nicolae and Elena Ceaușescu, the Romanian leader and his wife, for mass killings in Timisoara and Bucharest during their overthrow. There have been several other genocide convictions since (Guardian, 2015), but literature on these is limited. Background The trial was conducted during civil unrest leading to the Ceaușescus’ fall from power, on a highly ad hoc and ‘summary’ basis by military prosecutors (Quigley, 2006, p38). Legal basis Romania acceded to the Genocide Convention in 1950, including a genocide provision in its 1969 Penal Code (Prevent Genocide International, 2015a). Schabas attributes the use of a genocide charge purely to an (overestimated) victim count (2000, p421). Timescale The ‘genocide’ for which the Ceaușescus were charged took place on 16 December 1989. The trial began - and ended, with the execution of both Ceaușescus - on 25 December 1989. Results The trial was harshly criticised; Quigley describes it as the ‘most summary’ domestic genocide tribunal (p39).

4.8 Estonia, Lithuania and Latvia - 1990s These were trials of Soviet officials involved in 1940s-era persecution of citizens of Baltic states, which, given their commonalities, will be examined together (Liivoja, 2013). Background None of these countries prosecuted Soviet officials while part of the USSR. Extended peacetime experience, combined with nationalist political support for prosecutions, enabled these countries to rapidly establish robust investigatory structures after independence (Pettai and Pettai, 2014). Legal basis None of the three had signed the Genocide Convention while part of the USSR (and the crimes charged predated the legal concept of genocide). All three ratified the Convention and gave it domestic effect during the 1990s, although they did not address the issue of retroactivity (Quigley, 2006). Trial timescale The three countries were quick to prosecute charges after independence, which were usually of medium length. In Lithuania, the trial of Jouzas Sakalys, an NKVD officer began in 1995, leading to a guilty verdict in February 1997, which was overturned for a (successful) retrial in December 1998. In many cases, the long delay before trial meant that defendants died before conviction, or had sentences waived or reduced (TRIAL, 2015a). Results Despite dozens of trials reaching convictions, many were undermined by procedural irregularities leading to retrials (Quigley, 2006, p43) and widespread use of amnesty laws (Associated Press, 1997). Furthermore, Baltic domestic genocide prosecution efforts have been criticised as politically motivated, supporting contemporary nationalist sentiments (Katz, 2010; Pettai and Pettai, 2014; Ynetnews, 2008), and minimising complicity in the Holocaust by stressing Soviet persecution (Prevent Genocide International 2015b). 4.9 Ethiopia - 1992-2006

These were Ethiopian trials of Colonel Mengistu Haile Mariam and other members of the ‘Derg’ junta, for their role in the 1977-1978 ‘Red Terror’ against political opponents. Background Trials took place following the Derg’s overthrow in 1991. The civil war and ensuing damage to judicial infrastructure meant that Ethiopian genocide prosecution efforts were initially slow, although this was partially remedied by international (and domestic) technical support in the early 1990s (Tronvoll, Schaefer, and Girmachew, 2009). Legal basis Ethiopia was ‘well equipped legally for genocide prosecutions’ (Quigley, 2006, p42), being the first state to ratify the Convention (in 1949) and including provisions in its 1957 penal code for genocide against political groups (though this expansion has been criticised (Kissi, 2006; Schabas, 2000)).

Timescale The Special Prosecutor’s Office was established in August 1992, but subsequent trials were lengthy. Writing just before the main ‘Red Terror’ trial of Mengistu and his associates concluded in December 2006, Kissi criticised the ‘ten-year-old trial’ for its ‘erratic’ stop-start pace, the pre-verdict deaths of 43 elderly defendants, and the difficulty in gathering evidence on thirty year-old crimes (Kissi, 2006, p103). Results Trials resulted, by late 2006, in 1569 verdicts and 1017 convictions, many in absentia (Kissi, 2006). They have received some praise for developing institutional capacity and providing a deterrent and cathartic effect (Haile-Mariam, 1999), but also received criticism for their length, expanded definition of genocide, and failure to address government crimes (Kissi, 2006). 4.10 Brazil - 1993

This was the trial of a mining group for the 1993 Haximu massacre of Yanomami indigenous people. Background A trial structure (with Presidential backing) was quickly established in Brazilian state courts (Turner, 1994). Legal basis Brazil had ratified the Genocide Convention in 1952, and signed it into law in 1956. While only 16 Yanomami were killed, Gilbert notes that it was a large fraction - ’partial group destruction’ - of the 80 or so members of this Yanomami sub-tribe (Gilbert, 2014, p55). The main legal issue at trial was the degree to which perpetrators’ intent was genocidal (Quigley, 2006). Timescale Pre-trial investigation began in September 1993, a month after the massacre, leading to convictions of the defendants in December 1996. These were overturned in January 1997, with convictions being upheld in September 2006 (PIB, 2000). Results Despite legal confusion about who should try the defendants (leading to annulments of verdicts and reported distress among surviving Yanomami (CCPY, 2010)), the convictions were eventually upheld by Brazil’s Supreme Court (Survival International, 2006). 4.11 Rwanda - 1996 - ongoing These were trials of genocidaires in the Rwandan genocide - generally lower-level perpetrators not prosecuted by the ICTR. Background Rwanda’s legal system was heavily damaged, with, Schabas relates, ‘only about 20 lawyers with genuine legal education in the country’ in 1994 (2005, p874). Accepting limited international technical and legal support (particularly from the ICTR in case referral (ICTR, 2015)), Rwanda committed to prosecuting large numbers of perpetrators, whose estimated

numbers varied widely, from 100,000 (detained in the 1990s) to 1,000,000 (Rwandan judiciary estimate). Legal basis Rwanda had acceded to the Genocide Convention in 1975 and passed two Organic Laws in 1996 and 2001, empowering conventional trials and traditional communal justice (gacaca). Schabas suggests that initial charges had ‘all the appearances of fairness’ (p888). Timescale Pre-1996 Organic Law delays in setting up trials, and the massive backlog of detainees, led to extensive illegal detention without charge. Clark notes that gacaca trials partially resolved this by offering greater capacity to mount individually speedier trials, but that these too faced delays (Clark, 2010). Neither author extensively criticises the length of the trials themselves. Gacaca trials concluded in June 2012. Results Despite severe problems of pre-trial and prisoner backlogs, Schabas, writing in 2005, was guardedly positive about Rwanda’s regular trial output, citing its then-completed 10,000 trials as ‘an impressive figure … better than the record of many European countries following the second world war’ (p889). Clark, on Gacaca courts, is also positive, noting that - despite ‘highly variable’ results - Gacaca was an effective process, fostering healing and reconciliation (2010, p342-5). Others have questioned the fairness, organisation, and security of their results (Jones, 2006). 4.12 Croatia - 1997

This was a trial of Milos Horvat, a Serb paramilitary fighter, for his role in ‘ethnically cleansing’ a mixed village of Croats. Background The Croatian judicial system was relatively intact, although the US State Department noted that ‘government influence weakens the nominally independent judiciary’, often along anti-Serb lines (US State Department, 2008). Legal basis Horvat was convicted under Article 119 of the (retroactively applied) Croatian Penal Code. The Code widened the definition of genocide, including ‘giv[ing] orders to forcible displacement with the intent to destroy in whole or in part’ a population (International Alliances, 1998, p7); which Schabas (2008, p707) suggests was ‘only the most liberal conception of genocide’. Timescale The trial was carried out speedily - an extradition process from Germany took place between November 1995 and May 1997, and Horvat was found guilty in June 1997. Results Horvat was convicted of genocide, but sentenced to a comparatively short five-year sentence because of his lack of ’any special extremism’ (International Alliances, 1998, p17). Observers questioned the trial’s legal basis and fair appraisal of evidence (US State Department, 1998).

4.13 Kosovo - 2000-2001

This was the trial of Miroslav Vukovic, a Kosovan Serb accused of forced expulsion and ethnic cleansing of ethnic Albanians during the Kosovo war 1997-1999. Background Kosovo’s judicial and police systems ‘ma[d]e little effort to conceal their anti-Serb bias’, and were lacking in capacity, leading one UN official to remark that ‘there is no working justice system in Kosovo’ (in Hammer, 2000), and severely damaging the credibility of the trial. Legal basis Vukovic was tried and initially convicted under Article 141 of the Criminal Code of Yugoslavia, using the ‘forcible dislocation of the population’ clause mentioned in 4.12. The Supreme Court of Kosovo, however, overturned this, citing its incongruity with international definitions of genocide (Cassesse et al. 2013). Timescale The Vukovic trial began in June 2000 (UNMIK, 2000), fairly swiftly after Vukovic’s arrest in August 1999 (BKTV, 2004), and ended in January 2001 (UNMIK, 2001). The subsequent overturning of the case before the Supreme Court also took place quickly, in August 2001 (OSCE, 2010). Result Vukovic’s initial conviction by a Mitrovica district court was overturned by a mixed international and national Supreme Court decision, ruling that charges of genocide were not proven and that the trial had been poorly conducted (Schabas, 2000), but that he was guilty of war crimes and crimes against humanity. Hartmann, the prosecutor on the retrial, informally reported that Vukovic was convicted for war crimes in October 2002, noting ‘the value of international majority involvement’ in domestic processes (Hartmann, 2002). 4.14 Iraq - 2006-2007 This was the trial of Saddam Hussein and six others for the ‘Anfal massacre’ - the genocide of Kurds in Iraq in 1988. Background Following the fall of Hussein’s regime, the US (in particular) provided financial and administrative support to rebuild the Iraqi judiciary, but its effectiveness was questioned by HRW, who criticised Iraqi courts’ safety, stability, and capacity. Violence against defence lawyers was also rife (2006b). Legal basis Iraq had acceded to the Genocide Convention in 1959, and the legal basis of the charges was not reportedly challenged by Hussein or his codefendants (Oliver, 2006). Timescale The Anfal massacre occurred in 1988. The trial began in April 2006, over two years after Hussein’s capture, but was cut short by Hussein’s execution following conviction in the Dujail trial (a prosecution for a different massacre, which had begun earlier) in December 2006. It gave a posthumous guilty verdict in June 2007 (Schabas, 2006).

Results The execution of Hussein disrupted the trial process - the New York Times, in an assessment before the verdict, argued that the Anfal case was significantly more meaningful to many Iraqis that the Dujail one (Wong, 2006), suggesting that this did deny some of the catharsis from the former. 4.15 Bosnia - 2006-2008, 2014

This was the trial of eleven Republika Srpska soldiers for their role in the Kravica massacre, part of the broader Srebrenica massacre. Background The trial took place several years after the war of the Yugoslav succession, and legal infrastructure in Bosnia had recovered. Legal basis The trial was based on the 2003 Bosnian Criminal Code (Strippoli, 2009). The retroactive use of the 2003 Criminal Code (rather than the more lenient 1976 Yugoslav Penal Code) was later deemed illegitimate by the ECHR, leading to the verdicts being overturned (Justice Report, 2013). During the trial, the judges drew extensively on law established by the ICTY in its rulings and identifications of a target group. Timescale The trial began in May 2006, just under eleven years after the Srebrenica Massacre in July 1995, producing a verdict in July 2008. This was annulled in November 2013, the retrial began in January 2014, and new sentences were pronounced in June 2014. Results Strippoli praised the trial’s pursuit of low-level perpetrators and use of internationally established caselaw, but suggested that it became ‘uncertain’ as it moved onto new ground (p599). The retroactive use of the 2003 Code led to convictions being overturned, though they were upheld following a retrial. 4.16 Cambodia - 2006-ongoing

The Extraordinary Chambers in the Courts of Cambodia (ECCC) are ongoing trials of Khmer Rouge personnel. Background In 1997, Cambodian leaders requested international assistance establishing a tribunal for Khmer Rouge perpetrators, which was agreed to, following disagreements about the degree of international oversight. Subsequent complications included (financial) relations between the Cambodian state and accused perpetrators, a then-rescinded amnesty law (OSJI, 2011), a ‘ramshackle and underfunded’ judicial system, and vulnerability to political interference (Quigley, 2006, p30). Legal basis The ECCC’ was created by a 2001 law; there were few challenges to the Court’s substantive law and establishment (Ciorciari, and Heindel, 2014) or its retroactivity (Quigley, p30).

Timescale The ECCC’s ongoing work has proceeded slowly, with set-up negotiations alone lasting 1997-2003, and the Court starting work in July 2006 (Kissi, 2006). It has since tried five defendants (one of whom - Pol Pot’s second-in-command - died on trial), and taken on four cases. Results The slow progress of the ECCC (convicting only four defendants in nine years) and over $200 million total cost (Campbell, 2014) - has faced major criticism, particularly for politically motivated delays (OSJI, 2015). Several writers suggest the tribunal provides a space for reconciliation (Ciorciari and Ly, 2009) and survivor participation and catharsis (Chy and Thomas, 2009), however. 4.17 Argentina - 2006 Several Argentine officials, including senior police official Miguel Etchecolatz, were charged with (political, not ethnic) genocide for their role in the 1974-1983 ‘dirty war’ against the Argentine left. Background Initial attempts to prosecute perpetrators were largely unsuccessful (Jones, 2006), but resumed under the Kirchner governments with the 2003 repeal of impunity laws. Partly owing to the delay since the ‘dirty war’ ended, the judicial system was relatively intact. Timescale Initial prosecutions were halted by the 1986 ‘Full Stop law’. New investigations into major crimes began in 2003; Etchecolatz’ trial began in June 2006 and swiftly concluded in September 2006 (Micus, 2015). Legal basis The court convicted Etchecolatz on a combination of its own penal code (which lacked specific genocide provisions) and international sources. The Argentine court deliberately referenced the Genocide Convention’s predecessor, UNGA Resolution 96(I), for its inclusion of political groups as protected victims, arguing that the earlier document was ‘more legitimate than the politically compromised Convention definition’ (Klein, 2007, p100-102). Jones suggests that this represents ‘the legal [if ‘inelegant’] cutting edge’ of genocide prosecutions (Jones, 2013, p100), but others have criticised it for straying outside the international legal mainstream (Micus, 2015). Results The Etchecolatz trial led to a successful conviction, and did not receive criticism by observers for its fairness (Micus, 2015). 4.18 Bangladesh - 2009 - present

These are trials of Bangladeshi collaborators with the Pakistani military during the 1971 Bangladesh Genocide. Background Bangladesh opted not to try Pakistani soldiers immediately after independence (Moses, 2010).

Highly politicised (Economist, 2013) trials began anew in 2010 following significant popular and governmental pressure. Legal basis Despite only acceding to the Genocide Convention in 1998, Bangladesh passed the International Crimes (Tribunals) (ICT) Act in 1973, enabling it to prosecute Bangladeshi perpetrators. Karim and Theunissen argue that this ignored modern legal developments on genocide (2013), while the International Bar Association describes it as ‘broadly compatible with international trial standards’ (Amir Ul-Islam, 2012, p254). Timescale The Bangladesh Genocide occurred in 1971. While the ICT Act was passed in 1973, it was only set up in March 2010. It is currently active (with its first verdict in January 2013); both the delays and subsequent rushes have been criticised as politically (particularly electorally) motivated (Ahmed and Mujtaba, 2013). Results The ICT has convicted 23 Bangladeshi nationals, with all but one trial resulting in life imprisonment or a death sentence (ict-bd.org, 2015). Trials have been criticised both by HRW - for their unfairness and use of capital punishment enabled by retroactive law (HRW, 2013a) - and by legal observers citing political-judicial collusion to prevent fair trials (de Silva, 2015). 4.19 Guatemala - 2012 - present This trial was for former Guatemalan leader Efraín Rios-Montt for mass killings of the indigenous Ixil population. Background Amidst an atmosphere of growing political and judicial pressure for investigations into human rights abuses, the UN-backed Commission for Historical Clarification had, between 1994 and 1999, found evidence of state-led genocidal killings (OSF, 2013). Rios-Montt had, meanwhile, been active politically, gathering widespread political support. Legal basis Guatemala had ratified the Genocide Convention by 1950, and incorporated it into its penal code. The Open Society Justice Initiative described the many constitutional challenges launched by Rios-Montt’s defence as an ‘abusive’ delaying tactic, rather than reflecting genuine legal problems (OSF, 2013, p9). Timescale Rios-Montt was unseated in 1983, but trial only began in March 2013. Following an annulment, this led to a conviction on 10 May 2013. After this too was overturned, the retrial - beginning 5 January 2015 - was then suspended due to judicial irregularity, to be restarted (following a challenge relating to Rios-Montt’s poor health) in January 2016 (Beaudoin, 2015a). Results Despite reaching a (short-lived) conviction, the trial has faced numerous setbacks and halts, which trial observers have ascribed largely to political interference (Economist, 2015). While

Rios-Montt was ruled fit to stand trial again in August 2015, his age and deteriorating health make this uncertain. 5. Findings and analysis One of the most important findings is that domestic genocide trials did happen, and on a large scale - twenty-one trial structures over the past century, compared to merely four international ones (the Nuremberg Trials, the ICTY and ICTR, and the ICC). This strongly suggests that, whatever their flaws, such domestic trials represent a significant topic of study, and that, despite unpromising conditions, states are able to establish tribunals that bring accused genocidaires to trial. They are not only more numerous, but also more widespread. While international genocide prosecutions have only been undertaken in Africa and Europe, domestic ones have occurred on five continents - one in North America, two in South America, five in Asia, ten in Europe, and three in Africa, regularly since the late 1970s, contradicting perceptions of the ‘Western’ bias of such trials and the notion that the legal regime on genocide ‘stood by’ until the ICTR and ICTY (Moses, 2010, p259). This suggests that, where states ‘own’ the legal process, countries around the world are strongly interested in pursuing internationally designed accountability measures, retributive prosecutions, or a symbolic legal break with the past, and that these are an established phenomenon. Many trials were deeply flawed from the beginning, often from foundational issues such as a shaky legal basis or reduced capacity stemming from damaged infrastructure. These often seriously compromised trial effectiveness, to the point where it is questionable whether many were actually prosecuting ‘genocide’ - but it does show that domestic trials could be established with some success, and are likely to continue to be so. 5.1 Background - How did the sociopolitical environment affect the establishment of genocide tribunals?

The political situation in post-conflict states had a huge impact on attempts to domestically prosecute genocide. We can observe two particular problems - diminished capacity and political interference. Diminished capacity was particularly evident in seven cases - Poland, the PRT, Equatorial Guinea, Romania, Iraq, Rwanda, and Ethiopia. In these cases, trials were held immediately (or at least shortly) after conflicts, or even while they were still ongoing, meaning that judicial infrastructure was often damaged, legally trained personnel were in short supply, and resources were scarce. In three of these cases (the PRT, Equatorial Guinea, and Romania), these led to very short trials which were identified as ‘show trials’, or otherwise poorly handled. In trials occurring long after the fall of the perpetrator regime (or held by other members of the perpetrator group), political support for the accused perpetrators often emerged, derailing trials, interfering with the judicial process, and leading to failed or drawn-out trials or over-generous pardoning agreements. This occurred in Ottoman Turkey, Bolivia, the Baltic States, Guatemala, Argentina, and West Germany. Politically-motivated judicial interference on perpetrators’ behalf was not always fatal to trials - in Argentina, courts and new governments explicitly rejected it later on - but it does seem to be a problem that led to drawn-out trials (in

Bolivia and Guatemala) or extremely lenient pardoning of perpetrators (as in Ottoman Turkey). Anti-perpetrator judicial bias could also undermine tribunals’ credibility and the ‘success’ of trials - an issue particularly noted in cases such as Romania, Croatia, and the first Kosovo trial - though this was less time-dependent. The cases provide extensive evidence of international support for domestic trials. This was particularly apparent in seven cases - the UNWCC/Polish trials, Bosnia, Kosovo, Rwanda, Ethiopia, Guatemala and the ECCC - with bilateral support in the PRT, supported by Vietnam, and Iraq, supported by the US. This support largely took three forms.. Firstly, international support played a major role in capacity-building, enabling effective prosecutions where damaged post-conflict judicial systems might otherwise have prevented action. Rwanda and Ethiopia were both ravaged by civil war, but legal and technical support (albeit at very different levels) allowed extensive trial infrastructures to emerge slowly over the following years, resulting in the two largest (in terms of caseload) domestic genocide tribunal structures in history. This compares favourably with post-conflict cases like Equatorial Guinea, where a lack of resources and capacity led to narrow, over-speedy, and politicised trials. Elsewhere, as in Guatemala’s internationally sponsored Historical Clarification Commission (OSF, 2013), Vietnamese support for the PRT in documenting Khmer Rouge Crimes while fighting was ongoing (Schabas, 2001b), and modern initiatives such as the Documentation Centre of Cambodia (Bates, 2007), international support took the form of evidence-gathering and documentation. Whatever their other flaws, all three tribunals were thus bolstered by a strong evidentiary base. International support could also mean legal advice and review, as with the UNWCC’s accreditation process for Allied war crimes charges or international support for the Kravica and Vukovic trials (Strippoli, 2009; Hartmann, 2002). For these latter two, this meant pressure from the ECHR (Justice Report, 2013) and UNMIK (Schabas, 2000) (respectively) to overturn and restart trials held on dubious bases; a failure of initial trial foundations, but an international contribution to more enduring success. Together with issues of timescale, below, this suggests a ‘zero-sum’ issue for trial backgrounds. Trials conducted shortly after the fall of genocidal regimes often suffered from disrupted infrastructure, hindering their capabilities (and safeguards against bias), but trials conducted much later were more vulnerable to political interference by groups sympathetic to defendants. International support, especially in the form of technical assistance and legal review, could address the former problem, shoring up and supporting damaged judicial structures. This would ‘tip the balance’ towards early/speedy trials, which, when bolstered by carefully designed international support, were often more successful. 5.2 Legal basis - How did the laws empowering states to prosecute genocide affect the success of trials? The states surveyed show a variety of strategies for prosecuting genocide on a legal basis, including use of pre-conflict ‘domesticated’ law on genocide, post-conflict legislation or executive orders, and (more rarely) ordinary criminal murder law. Pre-existent penal code provisions on genocide were used - wholly or substantially - in eight cases (Poland, Ethiopia, Brazil, Croatia, Kosovo, Iraq, Bosnia (in the retrial), and Guatemala),

and were present but unused in two (Romania and Bolivia). The former states often established trials with less legal ambiguity - of the eight, only Kosovo faced major problems on a legal basis. Where retroactive law was employed, prosecutions did not always fail, but often faced legal difficulties (as in Bosnia) or criticism for developing definitions of genocide that inescapably led to convictions (as in the PRT and Croatia). States which prosecuted without pre-existing genocide provisions, but instead employed international legal concepts - namely Equatorial Guinea and Argentina - faced criticism for vague charges that lacked legal weight. The exclusive use of ‘ordinary law’ is rarest, pre-dated the Genocide Convention, and was least successful. In West Germany, the use of ‘ordinary’ criminal law on murder (particularly on statute of limitations and motive grounds) contributed significantly to trial failure and cessation of prosecutions. In short, states that followed Article V of the Genocide Convention in enacting domestic legal genocide provisions often had fewer legal problems in establishing trials than those who did so retroactively. This is partly an issue of avoiding criticism for after-the-fact laws, and partly an issue of clarity and organisation. States with pre-existing legal structures were, like Ethiopia, ‘well-equipped’ to undertake prosecutions (Quigley, 2006, p42), while others needed to spend time establishing them. In their domestic legal codes, six countries expanded the list of victim groups to include political ones, either explicitly (Ethiopia and Argentina) or implicitly in judges’ legal reasoning (Romania, Bolivia, Equatorial Guinea, and Cambodia). These departures from the Convention faced significant criticism - Drumbl argues that political identification is less deep-seated that ethnicity or religion (2011), while Nersessian suggests it ‘dilutes’ the charge and risks making genocide charges into ‘propaganda’ (2010, p216). The latter concern would be vindicated by cases like Romania and Bolivia, where individual massacres were labelled genocide for political reasons, lacking the scale and exterminatory intent characterising ‘genocide’. This labelling also caused internal problems with trials - the invocation of genocide as a capital offence in Romania arguably contributed to the excessive speed and poor basis for the ‘summary’ trial. In other cases, however, this expanded definition did not seem particularly problematic, especially when consciously argued for. The Argentine assertion that they were prosecuting genocide under a definition less politically compromised than the Convention did have historical (if not legal) substance (Jones, 2006), and, this aside, the trial progressed without much other criticism (O’Donnell, 2009). Likewise, while the foundation of the Ethiopian trials was criticised (Ratner and Abrams, 2001), the specific choice to expand the definition did not receive criticism from legal observers such as Mayfield (1995). Expanded definitions of genocide - associated with domestic tribunals - were not fatal to trial processes, and did help prosecute perpetrators who might ‘slip through’ international law to be prosecuted for lesser crimes (van Schaack, 1997), but did face external criticism and encourage genocide charges for relatively minor crimes. Other redefinitions included the Yugoslav inclusion of forced deportation, and the PRT’s inclusion of destruction of traditional relations and forced labour, but these too faced international criticism. Luftglass argues that the expansive, after-the-fact Cambodian redefinition of genocide meant that conviction was ‘essentially guaranteed’ (2004, p903), while the Kosovan Supreme Court, explaining its annulment of the Vukovic verdict, noted

that forced deportation was not genocide under international law, and should have been (and eventually was) charged as crimes against humanity (Schabas, 2000). In other cases, countries moved onto still shakier legal ground. While many specific charges of genocide are disputed, there are four cases (Romania, Equatorial Guinea, Bolivia and Argentina) which are generally not seen as conventionally genocidal. Rather, ‘genocide’ charges seem rhetorically motivated, with little attention paid to proving that genocide was what took place. HRW noted that Bolivian prosecutors used ‘bloody massacres’ and ‘genocide’ interchangeably as charges, to rhetorically underline the case’s ‘special gravity’ (HRW, 1992, p8). Artucio observed the same phenomenon (‘massacres’ and ‘genocide’) and a similar lack of legal follow-up in Equatorial Guinea (1979, p32). Thus, there are several examples of domestic genocide prosecutions being levelled for political ends in circumstances where genocide did not occur. Nonetheless, this phenomenon is surprisingly uncommon, with purely politicised charges being levelled in less than a fifth of cases - far from the hypothetical worst case scenario where political persecution is routinely identified and charged as ‘genocidal’. 5.3 Timescale - What was the impact of time taken to begin genocide prosecutions, and time during genocide prosecutions, on trial success? While the small, country-specific dataset means we should be cautious about comparing trial durations across countries, a number of observations can be made. As discussed above, there does seem to be a trade-off between speedy trials (risking poor infrastructure) and late ones (risking political interference). To this, we can add the broader issues of loss of evidence (both material and of witnesses), and loss of momentum in pursuing ageing perpetrators. The first was a potential issue in the ECCC and Rios-Montt trials, which both came decades after genocides, but where the existence of specifically-tasked evidence-gathering bodies (in the PRT archives and Historical Clarification Commission respectively) helped to avoid this problem (OSF, 2013; Schabas, 2001b). The UNWCC similarly helped preserve evidence that might otherwise have been destroyed (UNWCC, 1948a). Resulting trials faced fewer evidentiary challenges and were more successful in reaching verdicts. Long-delayed trials could cause other problems: in Germany, statute-of-limitations-based challenges severely restricted prosecutors’ ability to bring charges other than murder, while in Lithuania (Associated Press, 1997), delays led to elderly perpetrators being deemed unfit to stand trial or given extremely light sentences. These issues highlight the risks posed by delays to establishing genocide tribunals. The median figure of the trials above (not accounting for multiple trial lengths in a single country, where only one was profiled) was twenty-two months. While this may seem fairly lengthy, this is not particularly unusual. Ford, analysing ICTY trials, notes that prosecutions of crimes against humanity and genocide are, essentially, highly complex murder trials, with complex systems of perpetrators, large numbers of witnesses, complex and technical aspects of criminal law, and numerous charges. They are, as such, likely to be lengthy (Ford, 2010). He suggested that they should properly be contrasted with quantifiably similarly complex domestic trials, such as the 1988 Lucchese trial in the US, which took 22 months. Many of the features that lead Ford to argue that international trials were not especially long for their complexity are also present in domestic ones. While domestic genocide prosecutions may have be somewhat lengthier than equivalent criminal ones, they were not unusually so.

There are, however, a number of significant outliers to this median figure. Four trials were noticeably very short - Poland/the UNWCC, the PRT, Equatorial Guinea, and Romania, all measurable in days (eighteen, four, five, and one respectively). Of these, three (the PRT, Equatorial Guinea, and Romania) were held during or immediately after violent regime changes, and were subsequently criticised as ‘show trials’; the remaining one (Poland) was short and lacked a chance to appeal, but both prosecutors and defendant had had an extensive period to prepare. Thus, short (less than one month) trials were typically associated with poor quality, limited resources, and international criticism. Five trials were very long, lasting five years or more (Bolivia, Bangladesh, Ethiopia, the ECCC, and Rwanda - eighty-six, sixty-five (ongoing), 172, 109 (ongoing), and 186 months respectively. Guatemala seems likely to join these). Four were major tribunal processes prosecuting multiple defendants in separate cases (Rwanda, Ethiopia, the ECCC, and Bangladesh). The first two were understandably lengthy, given their extremely large caseloads, but the ICT and ECCC have so far only convicted twenty-one and three cases respectively. The ICT, the ECCC, Guatemala and Bolivia were all cases with significant political interference, suggesting a link between over-lengthy trials and political interference (and, by extension, long delays until trials). These several-year tribunal structures were expensive, limited in their ability to reach verdicts, and did not provide much closure. 5.4 Results - Did domestic genocide trials lead to concrete and enduring results, or did they collapse?

Only four of twenty-one cases ‘failed’, in the sense that the tribunal processes collapsed, were derailed by external politics, or wore on into stalemates (Ottoman Turkey, Germany, Iraq, and, it seems likely, Guatemala). This suggests that, even under adverse conditions, there is a strong commitment to prosecuting perpetrators of genocide. The ‘failures’ were, respectively, two prosecutions reluctantly undertaken by members of the perpetrator group, and a case where another, lesser charge was completed first for political reasons. These represent specific disruptive circumstances, rather than systemic problems for domestic genocide prosecution. Where states decided to begin trials, they generally followed through on them, even over years of prosecution, reflecting the severity of genocide charges. Lesser instances of ‘failure’ can be found in nine tribunals (Ottoman Turkey, Germany, Lithuania, Latvia, Estonia, Guatemala, Brazil, Bosnia, and Kosovo), where cases collapsed due to procedural and foundational legal irregularities, with repeated annulments of verdicts, contradictory rulings from appeal courts, trials being reset to earlier stages, and over-generous amnesty laws. While - as in the Vukovic case - this could be due to substantive questions of law and evidence, this can often be traced back to poor trial planning, retroactive use of law, and political interference, suggesting that poor foundations were indeed the cause of poor trials. This commitment to ‘completed’ and ‘successful’ trials is not without questionable results. This dissertation has not assessed trial fairness, but this has been a perennial theme when looking at trial results. There were few acquittals, and sentences were often harsh, as with the ICT’s use of life imprisonment and capital punishment, and accusations of ‘show trials’ (the PRT, and the trial of the Ceaușescus) or one-sided prosecutions (as in Rwanda (Jones, 2006) and Ethiopia (Tiba, 2013)) are common. This is commonly linked with trials in the chaos of the immediate aftermath of regime change (such as the PRT and in Equatorial Guinea), but this is not always the case. Schabas observed that Rwandan trials showed ‘all the appearances

of fairness’ (2005, p886), despite their postwar setting, while Baltic trials were highly politicised despite stable judiciaries. This suggests both that political pressure for ‘successful’ prosecutions can overwhelm fair trial standards, and that this is not inevitable in damaged post-conflict judiciaries, which can still produce reputable results. This dissertation has predominantly focused on trials rather than broader questions of transitional/restorative justice, but the literature provides several examples of trials having positive effects in terms of documentation and reconciliation. Rwanda’s gacaca courts offered broad civil participation (Clark, 2010) and mourning for victims (Carter, 2008), while the PRT created a documentary record of the genocide (de Nike, 2012, p22). In other cases, poor handling had negative impacts. Yanomami groups reported great distress when convictions were overturned (CPY, 2010), while Latvian Jews reportedly saw selective ‘genocide prosecutions’ as a means of minimising Latvian participation in the Holocaust and asserting victimhood (JTA, 1999), highlighting the need for transparency - tribunals founded or shut down on murky and unclear grounds risked alienating victims.

6. Conclusions - common areas of failure and success in genocide tribunals Comparative research on genocide prosecutions has often minimised the role of domestic justice role in favour of international processes, but a systematic study of the former reveals a much richer basis for national courts than the literature suggests. Twenty one trials were held (with only four ‘failures’ ), across five continents, often in extremely adverse circumstances, charging presidents and foot soldiers alike. Many were unfair or charged genocide too hastily, but this still represents a highly significant achievement of accountability for major crimes. The most basic condition for successful prosecutions, it seems, was political will - where states decided to prosecute genocide cases, the solemn and psychologically resonant nature of the charges sustained prosecutions through to the end. Despite widely varying case studies, a number of common obstacles and conditions for success were observable. In Parts 5.1 and 5.3, we examined the role of trial backgrounds and timescale. As Jones (2006, p368) notes, post-genocidal countries often suffered from damaged legal infrastructure, as seen in cases such as Rwanda, Equatorial Guinea, and Iraq. Countries that delayed trials, however, (such as the Baltic states and Guatemala) risked political interference that disrupted and derailed trials. The ‘trade-off’ is tipped towards early trials by international (particularly technical) support - Ethiopia, Kosovo, and the PRT providing three (very different) examples of forms this could take. Successful trials often occupied a ‘sweet spot’, between two months and three years, as befitting their status as complex murder investigations (shorter ones, such as the PRT, were often criticised as ‘show trials’), when not dragged out by political interference (as in Bolivia). In Parts 5.2 and 5.4, we examined the impact of legal basis on the ‘enduring’ nature of trial results. The ten countries that incorporated genocide law into their penal codes usually enjoyed greater success (as in Ethiopia, Guatemala, Brazil, and Poland) than those that had to develop retroactive laws (as in the PRT and Bosnia). National courts struggled in six cases with broadened definitions of genocide (usually to include political groups, as in Ethiopia, Argentina, and Equatorial Guinea, with varying results) and the temptation to apply the charge rhetorically in situations that were not truly genocidal (as in Bolivia and Romania). While only four trial processes ‘collapsed’ once begun, nine (including Germany, the Baltic states, Guatemala, and Bosnia) ran into difficulties due to foundational irregularities and procedural delays, underlining the importance of a firm legal basis. Nonetheless, the majority of trials produced strong, enduring verdicts, convicting perpetrators for genocide. For all their flaws and unpromising beginnings, this represents a significant success. In addition, well-handled prosecutions could have a positive emotional and cathartic impact on their populations (as in Rwanda and Cambodia), though mishandled trials (such as Brazil and Latvia) could have negative results. To conclude, domestic genocide tribunals could be, and have been, successful in bringing génocidaires to trial. Domestic political will, intact (or repaired) judicial systems, careful documentation, a considered legal basis, and international support to ‘plug the gaps’ are all associated with successful establishment of tribunals, and successful tribunals themselves. While it may be tempting to internationalise trials into the familiar legal surroundings of the Hague or ICC, or even resort to summary justice, as Churchill wanted for leading Nazis

(Cobain, 2012), domestic genocide prosecutions offer a convincing alternative. This initial survey has found these trials to be uneven, flawed, and imperfect, but, with the proper support and environment, a potentially effective approach. 7. Further research

This broad preliminary survey of the field, and its commensurately broad conclusions, was necessary to gather the comparative sweep that took in all domestic prosecutions for genocide since 1900, but it highlights several avenues of further study. - Further research could examine trial fairness (rather than foundation); how the latter

affected the former, and how both affected trial results. One example of this would be the role of the defence in domestic genocide tribunals, highlighted in some cases as a weakness (both Cambodia tribunals), but as a surprising strength in others (the tribunal of Macias Nguema). Further research could explore how far these differences were the product of judicial policies, and what impact the unpopular task of defending a génocidaire had on trial processes.

- We have examined ‘false positives’ but not ‘false negatives’ - cases where states could have

begun prosecutions, but did not. It is much harder to collate these, but the International Crimes Database provides a list of domestic genocide claims, including several brought by indigenous peoples in Canada and Australia that were not approved, as well as the trial of Luis Echeverria in Mexico, which failed after a nine year dispute at the pretrial stage (HRW, 2007; TRIAL, 2015). Were these due to weaknesses in the claims, or broader systemic issues of political background and timescale?

- Further research might seek to bridge the emerging literature on ‘positive complementarity’

in the ICC with the specific successes and failures of international support identified above, particularly regarding the practices of documentation and truth commissions.

Bibliography

Ahmad, T. (2015). The politicalisation of Bangladesh's war crimes tribunal. Al-Jazeera. [online] Available at: http://www.aljazeera.com/indepth/opinion/2013/10/politicalisation-bangladesh-war-crimes-tribunal-20131011121449114453.html [Accessed 5 Sep. 2015].

Ahmed, T. and Mujtaba, G. (2013). Azad gets death for war crimes. BDNews24. [online] Available at: http://bdnews24.com/bangladesh/2013/01/21/icts-death-penalty-for-bachchu-razakar [Accessed 5 Sep. 2015].

Amir-Ul Islam, M. (2012). Towards the Prosecution of Core International Crimes before the International Crimes Tribunal. In: M. Bergsmo and C. Wui Ling, eds., Old Evidence and Core International Crimes, 1st ed. [online] Available at: http://www.fichl.org/fileadmin/fichl/documents/FICHL_16_Web.pdf [Accessed 5 Sep. 2015].

Artucio, A. (1979). The Trial of Macías in Equatorial Guinea. Geneva: International Commission of Jurists.

Associated Press, (1995). Former Dictator Garcia Meza Extradited to Bolivia. [online] Available at: http://www.apnewsarchive.com/1995/Former-Dictator-Garcia-Meza-Extradited-to-Bolivia/id-974690c0f2e9a6bc58f4f61c83950919 [Accessed 5 Sep. 2015].

Associated Press, (1997). Former Soviet Agents Sentenced on Genocide Charges in Lithuania. [online] Available at: http://www.apnewsarchive.com/1997/Former-Soviet-agents-sentenced-on-genocide-charges-in-Lithuania/id-a242d5746a6a7f789f5ec2e12b74b258 [Accessed 5 Sep. 2015].

Balint, J. (2013). The Ottoman State Special Military Tribunal for the Genocide of the Armenians: ‘Doing Government Business’. In: K. Heller and G. Simpson, eds., The Hidden Histories of War Crimes Trials, 1st ed. Oxford: Oxford University Press, pp.77-102.

Barrett, J. (2010). Raphael Lemkin and ‘Genocide’ at Nuremberg. In: C. Suffering and E. Conze, ed., The Genocide Convention Sixty Years after Its Adoption, 1st ed. The Hague: Asser Press, pp.35-54.

Bassiouni, M. (2011). Crimes against humanity. Cambridge: Cambridge University Press. Bates, A. (2007). Cambodia’s Extraordinary Chamber: Is it the Most Effective and

Appropriate Means of Addressing the Crimes of the Khmer Rouge?. In: R. Henham and P. Behrens, eds., The Criminal Law of Genocide International, Comparative and Contextual Aspects, 1st ed. Aldershot: Ashgate, pp.185-195.

BBC, (2012). Rwanda 'gacaca' genocide courts finish work. [online] Available at: http://www.bbc.co.uk/news/world-africa-18490348 [Accessed 5 Sep. 2015].

Beaudoin, S. (2015a). Court Orders Rios Montt and Rodriguez Sanchez Retrial to Begin in January 2016. IJ Monitor. [online] Available at: http://www.ijmonitor.org/2015/08/court-orders-rios-montt-and-rodriguez-sanchez-retrial-to-begin-in-january-2016/ [Accessed 5 Sep. 2015].

Beaudoin, S. (2015b). Expert Findings Cast Doubt on Rios Montt Retrial. IJ Monitor. [online] Available at: http://www.ijmonitor.org/2015/08/expert-findings-cast-doubt-on-rios-montt-retrial/ [Accessed 5 Sep. 2015].

Bennett, G. (2013). The Limits of West German Justice in the 1960s: The Post-war Investigation of Walter Gieseke (Oberstleutenant of the Gendarmerie and SS). Law, Crime & History, 3(2), pp.116-139.

BKTV, (2004). Two Kosovo Serb Indictees Release on Bail After Four Years in Detention. [online] Available at: http://www.slobodan-milosevic.org/news/bktv072104.htm [Accessed 5 Sep. 2015].

Bloxham, D. (2001). Genocide on trial. Oxford: Oxford University Press.

Bloxham, D. and Pendas, D. (2010). In: D. Bloxham and A. Moses, eds., The Oxford Handbook of Genocide Studies, 1st ed. Oxford: Oxford University Press.

Boulet, R. (2009). The world's first genocide trial, 30 years on. Phnom Penh Post. [online] Available at: http://www.phnompenhpost.com/national/worlds-first-genocide-trial-30-years [Accessed 5 Sep. 2015].

Campbell, C. (2014). Cambodia’s Khmer Rouge Trials Are a Shocking Failure. Time. [online] Available at: http://time.com/6997/cambodias-khmer-rouge-trials-are-a-shocking-failure / [Accessed 5 Sep. 2015].

Carter, L. (2015). Justice and Reconciliation on Trial: Gacaca Proceedings in Rwanda. New England Journal of International and Comparative Law, 14.

Casey-Maslen, S. (2014). The war report - 2013. Oxford: Oxford University Press. Cassese, A., Gaeta, P., Baig, L., Fan, M., Gosnell, C. and Whiting, A. (2013). Cassese's

international criminal law. . Oxford: Oxford University Press Chy, T. and Thomas, S. (2009). Including the Survivors in the Tribunal Process. In: J.

Ciorciari, Y. Chang and A. Heindel, eds., On Trial: The Khmer Rouge Accountability Process, 1st ed. Phnom Penh: Documentation Center of Cambodia.

Ciorciari, J. (2014). Experiments in International Criminal Justice: Lessons from the Khmer Rouge Tribunal. Michigan Journal of International Law, 35(2).

Ciorciari, J. and Heindel, A. (2014). Hybrid Justice. Ann Arbor: University of Michigan Press.

Ciorciari, J. and Ly, S. (2009). The ECCC’s Role in Reconciliation. In: J. Ciorciari, Y. Chhang and A. Heindel, eds., On Trial: The Khmer Rouge Accountability Process, 1st ed. Phnom Penh: Documentation Center of Cambodia.

Clark, P. (2010). The Gacaca courts, post-genocide justice and reconciliation in Rwanda. Cambridge: Cambridge University Press.

Comissão Pró-Yanomami (CCPY), (2010). Massacre de Haximu. [online] Available at: http://www.proyanomami.org.br/frame1/ingles/massacreHX.htm [Accessed 5 Sep. 2015].

Crowe, D. (2013). War crimes, genocide, and justice. New York: Palgrave. Dadrian, V. and Akçam, T. (2011). Judgment at Istanbul. New York: Berghahn Books.

de Nike, H.. (2012). Reflections of a Legal Anthropologist on the Trial of Pol Pot and Ieng Sary, in De Nike, H.J., Quigley, J., Robinson K.J. eds., Genocide in Cambodia: Documents from the Trial of Pol Pot and Ieng Sary. Philadelphia: University of Pennsylvania Press.

de Silva, D. (2015). The Bangladesh War Crimes Tribunal should be internationalised - for the sake of the nation’s future. No Peace Without Justice. [online] Available at: http://www.npwj.org/ICC/Bangladesh-War-Crimes-Tribunal-should-be-internationalised-sake-nation%25E2%2580%2599s-future.html [Accessed 5 Sep. 2015].

Dresser, D. (2005). Mexico Stubbornly Denies Its Dark Past. Los Angeles Times. [online] Available at: http://articles.latimes.com/2005/feb/27/opinion/oe-dresser27 [Accessed 5 Sep. 2015].

Drumbl, M. (2011). The Crime of Genocide. In: B. Brown, ed., Research Handbook on International Criminal Law, 1st ed. Edward Elgar Publishing, pp.37-61.

Ellis, M. (2014). Assessing the Impact of the United Nations War Crimes Commission on the Principle of Complementarity and Fair Trial Standards. Criminal Law Forum, 25(1-2), pp.191-222.

Fawthrop, T. and Jarvis, H. (2004). Getting away with genocide?. London: Pluto Press.

Fischer, H., and McDonald, A. (2001). Yearbook of International Humanitarian Law - 2002. Cambridge: Cambridge University Press.

Ford, S. (2014). Complexity and Efficiency at International Criminal Courts. Emory International Law Review (29).

Friedlander, H. (1984). The Judiciary and Nazi Crimes in Postwar Germany. Simon Wiesenthal Center Annual, [online] 1(2). Available at: http://motlc.wiesenthal.com/site/pp.asp?c=gvKVLcMVIuG&b=394973 [Accessed 5 Sep. 2015].

Gilbert, J. (2014). Nomadic peoples and human rights. Routledge (London). Goldston, J. (2013). When Grave Crimes Elude Justice. New York Times. [online] Available

at: http://www.nytimes.com/2013/05/30/opinion/global/when-grave-crimes-elude-justice.html?_r=1 [Accessed 5 Sep. 2015].

Haile-Mariam, Y. (1999). The Quest for Justice and Reconciliation: The International Criminal Tribunal for Rwanda and the Ethiopian High Court. Hastings International and comparative Law Review, 22(4), pp.pp. 667-745.

Hammer, J. (2000). ... And Justice For Some. Newsweek. [online] Available at: http://www.newsweek.com/and-justice-some-160669 [Accessed 5 Sep. 2015].

Hartmann, M. (2002). Re: 12-year prison sentence in Kosovo war crimes trial. [online] University of Buffalo JUSTWATCH Listserv. Available at: https://listserv.buffalo.edu/cgi-bin/wa?A2=ind0210&L=JUSTWATCH-L&D=0&P=281955 [Accessed 5 Sep. 2015].

Horvitz, L. and Catherwood, C. (2006). Encyclopedia of war crimes and genocide. New York: Facts on File.

Human Rights Watch, (1992). Bolivia: Almost Nine Years and Still No Verdict In the "Trial of Responsibilities".

Human Rights Watch, (2006a). Judging Dujail - The First Trial before the Iraqi High Tribunal. [online] HRW. Available at: http://www.hrw.org/reports/2006/iraq1106/iraq1106web.pdf [Accessed 5 Sep. 2015].

Human Rights Watch, (2006b). World Report 2006 - Events of 2005. [online] Human Rights Watch. Available at: http://www.hrw.org/legacy/wr2k6/wr2006.pdf [Accessed 5 Sep. 2015].

Human Rights Watch, (2013a). Bangladesh: Halt Execution of War Crimes Accused. [online] Available at: https://www.hrw.org/news/2013/12/08/bangladesh-halt-execution-war-crimes-accused [Accessed 5 Sep. 2015].

Human Rights Watch, (2013b). Guatemala: Rios Montt Convicted of Genocide. [online] Available at: http://www.hrw.org/news/2013/05/10/guatemala-rios-montt-convicted-genocide [Accessed 5 Sep. 2015].

Ict-bd.org, (2015). International Crimes Tribunal, Bangladesh. [online] Available at: http://www.ict-bd.org [Accessed 5 Sep. 2015].

ICTR, (2015). Complementarity in Action: Lessons Learned from the ICTR Prosecutor’s Referral of International Criminal Cases to National Jurisdictions for Trial. [online] Office of the Prosecutor of the International Criminal Tribunal for Rwanda. Available at: http://www.unictr.org/sites/unictr.org/files/legal-library/150210_complementarity_in_action.pdf [Accessed 5 Sep. 2015].

Ijmonitor.org, (2015). Guatemala Trials | International Justice Monitor. [online] Available at: http://www.ijmonitor.org/category/guatemala-trials/ [Accessed 5 Sep. 2015].

International Alliances, (1998). Amnesty Report - Croatian Post-War Amnesty and the Reintegration Process. [online] The Hague: Micro-Justice for All. Available at: http://www.microjustice4all.org/site/dmdocuments/program/4Amnesty%20Report%20-%20War%20Crime%20Prosecution%20Croatia%201998.pdf [Accessed 5 Sep. 2015]

Jarvis, H. (2012). A Personal View of the Documents of the People’s Revolutionary Tribunal, in De Nike, H.J., Quigley, J., Robinson K.J. eds., Genocide in Cambodia: Documents from the Trial of Pol Pot and Ieng Sary. Philadelphia: University of Pennsylvania Press.

Jewish Telegraphic Agency (JTA), (1999). Around the Jewish World: Latvian Jews Troubled by ‘genocide’ Conviction of a Former Soviet Official. [online] Available at: http://www.jta.org/1999/10/11/archive/around-the-jewish-world-latvian-jews-troubled-by-genocide-conviction-of-a-former-soviet-official-2 [Accessed 5 Sep. 2015].

Jones, A. (2006). Genocide. London: Routledge. Jones, A. (2013). The Scourge of Genocide. Hoboken: Taylor and Francis.

Justice Report, (2013). Kravica - News, Analysis and Opinion :: Justice Report. [online] Available at: http://www.justice-report.com/en/cases/kravica-news-analysis-and-opinion/29/2#o29 [Accessed 5 Sep. 2015].

Karim, B. and Theunissen, T. (2011). Bangladesh. In: D. Shelton, ed., International Law and Domestic Legal Systems: Incorporation, Transformation, and Persuasion, 1st ed. Oxford: Oxford University Press.

Katz, D. (2010). Why red is not brown in the Baltics. The Guardian. [online] Available at: http://www.theguardian.com/commentisfree/cifamerica/2010/sep/30/baltic-nazi-soviet-snyder [Accessed 5 Sep. 2015].

Kaye, D. (2011). Justice beyond the Hague. New York: Council on Foreign Relations.

Kissi, E. (2006). Revolution and genocide in Ethiopia and Cambodia. Lanham, MD: Lexington Books.

Klein, N. (2007). The shock doctrine. New York: Metropolitan Books/Henry Holt.

Kraul, C. and Boudreaux, R. (2004). Ex-President of Mexico Indicted. LA Times. [online] Available at: http://articles.latimes.com/2004/jul/24/world/fg-arrest24 [Accessed 5 Sep. 2015].

Liivvoja, R. (2013). Competing Histories: Soviet War Crimes in the Baltic States. In: K. Heller and G. Simpson, eds., The Hidden Histories of War Crimes Trials, 1st ed. Oxford: Oxford University Press, pp.248-266.

Liniger-Goumaz, M. (1987). No change. Index on Censorship, 16(4), pp.31-32. Luftglass, S. (2004). Crossroads in Cambodia: The United Nation's Responsibility to

Withdraw Involvement from the Establishment of a Cambodian Tribunal to Prosecute the Khmer Rouge. Virginia Law Review, 90(3), p.893.

Lyons, J. (2015). Riga court frees jailed Stalinist agent. Baltic Times. [online] Available at: http://www.baltictimes.com/news/articles/6123/ [Accessed 5 Sep. 2015].

Maogoto, J. (2013). Reading the Shadows of History: The Turkish and Ethiopian ‘Internationalized’ Domestic Crime Trials. In: K. Heller and G. Simpson, eds., The Hidden Histories of War Crimes Trials, 1st ed. Oxford: Oxford University Press, pp.289-305.

Mayfield, J, 1995. Prosecution of War Crimes and Respect for Human Rights: Ethiopia's Balancing Act. Emory International Law Review, 9/553.

McDonald, M. (2013). Guatemala's top court annuls Rios Montt genocide conviction. NBC News. [online] Available at: http://worldnews.nbcnews.com/_news/2013/05/21/18402978-guatemalas-top-court-annuls-rios-montt-genocide-conviction [Accessed 5 Sep. 2015].

Micus, A. (2015). The Inter-American Human Rights System as a Safeguard for Justice in National Transitions. Leiden: BRILL.

Moses, A. (2010). War Crimes/Genocide Trials for Pakistani Soldiers in Bangladesh, 1971-1974. In: S. Hoffman, ed., Human Rights in the Twentieth Century, 1st ed. Cambridge: Cambridge University Press.

Nersessian, D. (2010). Genocide and political groups. Oxford: Oxford University Press.

O'Donnell, M. (2009). New Dirty War Judgments in Argentina: National Courts and Domestic Prosecutions of International Human Rights Violations. New York University Law Review, 84, pp.333-374.

Oliver, M. (2006). Saddam co-defendants deny Anfal genocide. The Guardian. [online] Available at: http://www.theguardian.com/world/2006/aug/22/iraq.markoliver [Accessed 5 Sep. 2015].

Open Society Foundations (OSF), (2013). Judging a Dictator: The Trial of Guatemala’s Ríos Montt. [online] Open Society Foundations. Available at: https://www.opensocietyfoundations.org/sites/default/files/judging-dicatator-trial-guatemala-rios-montt-11072013.pdf [Accessed 5 Sep. 2015].

Open Society Justice Initiative (OSJI), (2011). Recent Developments at the Extraordinary Chambers in the Courts of Cambodia June 2011 Update. [online] Available at: https://www.opensocietyfoundations.org/sites/default/files/cambodia-eccc-20110614.pdf [Accessed 5 Sep. 2015].

Open Society Justice Initiative, (2015). Recent Developments at the Extraordinary Chambers in the Courts of Cambodia: March 2015. [online] Available at: https://www.opensocietyfoundations.org/sites/default/files/eccc-march-2015-20150323.pdf [Accessed 5 Sep. 2015].

Organization for Security and Co-operation in Europe, (2010). Kosovo's War Crimes Trials: An Assessment Ten Years On, 1999 - 2009. [online] OSCE. Available at: http://www.osce.org/kosovo/68569?download=true [Accessed 5 Sep. 2015].

Pettai, E. and Pettai, V. (2014). Transitional and retrospective justice in the Baltic States. Cambridge: Cambridge University Press.

Plesch, D., Sattler, S. (2014). A New Paradigm of Customary International Criminal Law: The UN War Crimes Commission of 1943–1948 and its Associated Courts and Tribunals, Criminal Law Forum, 25(1), pp 17-43

Povos Indígenas no Brasil (PIB), (2015). Foi genocídio!. [online] Institutio Socioambental. Available at: http://pib.socioambiental.org/files/file/PIB_verbetes/yanomami/foi_genocidio.pdf [Accessed 5 Sep. 2015].

Prevent Genocide International, (2015a). Domestic Laws Against Genocide - Prevent Genocide International. [online] Available at: http://preventgenocide.org/law/domestic/ [Accessed 5 Sep. 2015].

Prevent Genocide International, (2015b). Domestic prosecution - Prevent Genocide International. [online] Available at: http://preventgenocide.org/punish/domestic/index.htm#germany [Accessed 5 Sep. 2015].

Quigley, J. (2006). The Genocide Convention. Aldershot, England: Ashgate Pub. Ratner, S. and Abrams, J. (2001). Accountability for human rights atrocities in international

law. Oxford: Oxford University Press. Riedel, D. (2006). The U.S. War Crimes Tribunals at the Former Dachau Concentration

Camp: Lessons for Today. Berkeley Journal of International Law, 24(2), pp.554-610. Schabas, W. (2001a). Problems of International Codification - Were the Atrocities in

Cambodia and Kosovo Genocide?. New England Journal of International Law, 35(2). Schabas, W. (2000). Genocide in international law. Cambridge, U.K.: Cambridge University

Press. Schabas, W. (2001b). Review of Genocide in Cambodia, Documents from the Trial of Pol Pot

and Ieng Sary. Human Rights Quarterly, 23(2), pp.470-477. Schabas, W. (2005). Genocide Trials and Gacaca Courts. Journal of International Criminal

Justice, 3(4), pp.879-895. Schabas, W. (2008). War crimes and human rights. London: Cameron May.

Seils, P. (2004). A Promise Unfulfilled? The Special Prosecutor’s Office in Mexico. [online] International Center for Transitional Justice. Available at: https://www.ictj.org/sites/default/files/ICTJ-Mexico-Special-Prosecutor-2004-English.pdf [Accessed 5 Sep. 2015].

Simon, T. (2007). The laws of genocide. Westport, Conn.: Praeger Security International. Simpson, C. (1993). The splendid blond beast. New York: Grove Press.

Slaughter, A. and Burke-White, W. (2006). The Future of International Law Is Domestic (or, The European Way of Law). Harvard International Law Journal, 47(2), pp.327-352.

Stahn, C. (2011). Taking Complementarity Seriously: On the Sense and Sensibility of 'Classical', 'Positive', and 'Negative' Complementarity. In: C. Stahn and M. El Zeidy, eds., The International Criminal Court and Complementarity: From Theory to Practice Vol. 1, 1st ed. Cambridge: Cambridge University Press.

Strippoli, A. (2009). National Courts and Genocide: The Kravica Case at the Court of Bosnia and Herzegovina. Journal of International Criminal Justice, 7(3), pp.577-595.

Survival International, (2015). Supreme Court upholds genocide ruling. [online] Available at: http://www.survivalinternational.org/news/1786 [Accessed 5 Sep. 2015].

The Economist, (2015). Justice confused. [online] Available at: http://www.economist.com/news/americas/21638190-trial-ailing-ex-dictator-plagued-chaos-justice-confused [Accessed 5 Sep. 2015].

The Economist (2013). Final Sentence. [online] Available at http://www.economist.com/blogs/banyan/2013/09/bangladesh-s-war-crimes-trials [Accessed 6 Sep. 2015]

The Guardian, (2015). Communist-era Romanian prison commander jailed for 20 years. [online] Available at: http://www.theguardian.com/world/2015/jul/24/romania-alexandru-visinescu-jailed-ramnicu-sarat [Accessed 5 Sep. 2015].

The Independent, (2014). First genocide trial against leaders of Khmer Rouge opens in Cambodia. [online] Available at: http://www.independent.co.uk/news/world/asia/first-genocide-trial-against-leaders-of-khmer-rouge-opens-in-cambodia-9802692.html [Accessed 5 Sep. 2015].

The Prosecution of War Crimes and Respect for Human Rights: Ethiopia's Balancing Act. (1995). Emory Journal of International Law, 553.

Tiba, F. (2013). Mass Trials and Modes of Criminal Responsibility for International Crimes: The Case of Ethiopia. In: K. Heller and G. Simpson, eds., The Hidden Histories of War Crimes Trials, 1st ed. Oxford: Oxford University Press, pp.306-326.

Totten, S., Bartrop, P. and Jacobs, S. (2008). Dictionary of genocide. Westport, Conn.: Greenwood Press.

Trevizo, D. (2011). Rural protest and the making of democracy in Mexico, 1968-2000. University Park, Pa.: Pennsylvania State University Press.

TRIAL, (2015a). TRIAL : Profiles. [online] Available at: h http://www.trial-ch.org/en/resources/trial-watch/trial-watch/profiles/profile/3965/action/show/controller/Profile.html, http://www.trial-ch.org/en/resources/trial-watch/trial-watch/profiles/profile/1065/action/show/controller/Profile.html,[Accessed 5 Sep. 2015].

TRIAL, (2015b). TRIAL : Track Impunity Always. [online] Available at: http://www.trial-ch.org [Accessed 5 Sep. 2015].

Tronvoll, K., Schaefer, C. and Girmachew A., (2009). The Ethiopian red terror trials. Woodbridge, Suffolk: James Currey.

Turner, T. (1994). The Yanomami: Truth and Consequences. Anthropology News, 35(5), pp.48-48.

U.S. State Department, (1998). Croatia Country Report on Human Rights Practices for 1997. [online] Bureau of Democracy, Human Rights, and Labor. Available at: http://www.state.gov/www/global/human_rights/1997_hrp_report/croatia.html [Accessed 5 Sep. 2015].

U.S. State Department, (2015). Rwanda 2014 Human Rights Report. [online] Available at: http://www.state.gov/documents/organization/236606.pdf [Accessed 5 Sep. 2015].

United Nations Interim Administration Mission in Kosovo (UNMIK), (2001). UNMIK-UNHCR-OSCE-EU Press Briefing. [online] Available at: http://reliefweb.int/report/serbia/unmik-unhcr-osce-eu-press-briefing-19-jan-2001 [Accessed 5 Sep. 2015].

UNMIK, (2000). Summary of UNMIK-KFOR Press Briefing 5 Jun 2000. [online] Available at: http://reliefweb.int/report/serbia/summary-unmik-kfor-press-briefing-5-jun-2000 [Accessed 5 Sep. 2015].

United Nations General Assembly (UNGA) (1946). General Assembly resolution 96 (I), The Crime of Genocide, (11 December 1946), available from http://daccess-dds-ny.un.org/doc/RESOLUTION/GEN/NR0/033/47/IMG/NR003347.pdf [Accessed 5 Sep. 2015].

United Nations War Crimes Commission (UNWCC) (1946). Minutes of Meeting Held on Wednesday 18th December 1946, M.120, p2.

UNWCC (1944). Polish Charges against German War Criminals, Registered No: 123/P/G/21, Case No. 20 (3 June 1944)

UNWCC (1948a). Documents listed in Research Office Summaries of Information 1 - 55, DS 4, 22, 33, SI.27, p1

UNWCC (1948b). Law Reports of Trials of War Criminals Volume VII. Her Majesty’s Stationery Office.

van Schaack, B. (1997). The Crime of Political Genocide: Repairing the Genocide Convention's Blind Spot. The Yale Law Journal, 106(7).

Williams, G. (2011). The Mexican exception. New York: Palgrave Macmillan. Williams, S. (2012). Hybrid and internationalised criminal tribunals. Oxford: Hart Pub.

Wittman, R. (2008). Tainted Law: The West German Judiciary and the Prosecution. In: P. Heberer and J. Matthus, eds., Atrocities on Trial: Historical Perspectives on the Politics of Prosecuting War Crimes, 1st ed. Lincoln, Nebraska: University of Nebraska Press, pp.pp 211-230.

Wong, E. (2006). Hussein Charged With Genocide in 50,000 Deaths. New York Times. [online] Available at: http://www.nytimes.com/2006/04/05/world/middleeast/05iraq.html?pagewanted=all&_r=0 [Accessed 5 Sep. 2015].

YNet News, (2008). Yad Vashem protests Lithuanian investigation of Holocaust survivor. [online] Available at: http://www.ynetnews.com/articles/0,7340,L-3512292,00.html [Accessed 5 Sep. 2015].

New media, old story: What the official Facebook pages of the US embassy in Islamabad and Pakistan embassy in Washington DC

tell us about public diplomacy

Sana Qadar

Abstract Social media has been hailed as a ‘great equaliser’ as it gives users a way to connect, engage and organise like never before, thus dismantling traditional power dynamics. It has also been hailed as a game-changer for public diplomacy, as it gives states unprecedented direct access to foreign publics. However, there is a paucity of research into its efficacy and empirical assessments of countries’ abilities to propagate narratives via social media remain scant. This study aims to examine the impact of social media in public diplomacy; compare patterns of engagement in states with a power differential; and broaden our understanding of social media diplomacy by developing nations. The Facebook pages of the US embassy in Pakistan, and Pakistan embassy in the US were monitored from 10 June to 10 July 2015, with factors such as engagement and reach assessed. Results illustrate that the US enjoys far more success in reaching and engaging its target audience – giving the country a greater edge in disseminating its narrative and gleaning insights on the thoughts of its followers (both key functions of public diplomacy). This casts doubts on claims that social media can act as an ‘equaliser’.

Chapter one: Introduction Various forms of media have long been used by states as tools of public diplomacy. In the US, contemporary public diplomacy efforts (though they were not referred to as such at the time) can be dated back to the 1930s, when the State Department began issuing ‘wireless files’. These were collections of written materials “supporting or explaining U.S. foreign policy…for journalists overseas,” for which success was measured in column inches (United States Advisory Commission on Public Diplomacy 2014: 8). The later use of TV and radio to control narratives and sway public opinion, particularly during the Cold War, is also well documented (Richter 2012: 106). In previous eras, considering or seeking to influence public opinion on matters of international policy would have been considered wholly unnecessary (Nicolson 1939, cited in Seib 2013: 8). However, as technology has evolved and access to information has increased, public opinion is less easily ignored. Indeed, many contend “politics in an information age ‘may ultimately be about whose story wins’” (Arquilla and Ronfeldt 1999, cited in Nye 2008: 100).

The latest iteration of this dynamic, in which states seek to conduct public diplomacy via media, involves social media. Since its inception in the mid-2000s, social media has grown to become a part of daily life for millions around the world who enjoy access to the internet. Between Twitter, Facebook, YouTube, Instagram and other platforms, the communications landscape is also more participatory than ever, allowing both greater access to information, and opportunities to engage – amplifying the need for states to consider public opinion (Shirky 2011; Zhong and Lu 2013). In recent years, the kinds of participants engaging on social media has also expanded: accounts are now maintained not just by individuals, but by companies, NGOs, political parties and even states themselves. It is on this last group of users that this paper will focus.

Social media has made it technologically possible for states to directly access foreign publics (Seib 2013), allowing them instant insight into what people are thinking and doing. This makes it a vastly more powerful conduit for the conduct of public diplomacy. But who benefits from this power? Internet enthusiasts contend that social media is revolutionary because it acts as a great equaliser: any account holder, be it an individual or state, has the same ability to broadcast their thoughts, share information, and organise with other users (Seib 2013: 6). Governments, however, can also use social media to police dissent, as has been observed in countries such as Iran (Christensen 2011). In the case of Iran, social media was used both as an organising tool among anti-government protesters following the 2009 presidential election – and as a tool for monitoring and repressing dissent by the government (Christensen 2011). This domestic example throws into question how ‘revolutionary’ social media can truly be. On an international level, with many states attempting to connect with foreign publics for the purpose of public diplomacy, it is worth questioning whether the availability of social media to all – both powerful and less powerful states – translates into a more equal playing field. This dissertation challenges the assumption that social media can act as an equaliser. In ‘Web 2.0 and Public Diplomacy’, Richter (2012: 113) asks, “is the new medium [of social media] an amplifier of existing patterns, an equaliser of existing divides, or does it have no impact at all?” Using this question as a point of departure, and the assumption that “politics in an information age is ‘ultimately about whose story wins’” (Arquilla and Ronfeldt 1999, cited in Nye 2008: 100), this dissertation compares the official Facebook page of the ‘U.S. Embassy Pakistan’ (hereafter US embassy in Pakistan), with the official page of the ‘Embassy of Pakistan, Washington D.C.’ (hereafter Pakistan embassy in the US). I assess factors such as engagement and reach, to argue Facebook has not had an equalising effect on power

differences between the two countries, particularly with regards to two aspects of public diplomacy: the ability to propagate a narrative, and listen to a target audience to glean insights on attitudinal trends. Instead, Facebook has become another venue in which familiar power dynamics play out, and where the US narrative continues to dominate. This is not necessarily the fault of social media itself – it is a reflection of the reality that shifting existing power imbalances requires more complex remedies than simply the exploitation of new communications platforms.

What is public diplomacy and does it matter?

Public diplomacy relates to the relationship between diplomats and foreign publics, whereas traditional diplomacy involves state-to-state or diplomat-to-diplomat interactions (Melissen 2005). According to Nicholas Cull’s taxonomy of public diplomacy, it is defined as “the process by which international actors seek to accomplish the goal of their foreign policy by engaging with foreign publics” (Cull 2008: 31). Public diplomacy’s mandate is to therefore connect with foreign publics and cultivate favourable opinions (Wang 2006). Cull divides public diplomacy into five functions: listening, advocacy, cultural diplomacy, exchange diplomacy and international broadcasting – each being a means through which states can cultivate influence and favourable opinions. Cull (2008: 53) emphasises the importance of the listening function of public diplomacy, which he says has historically been neglected.

However, no definition of public diplomacy is complete without reference to Joseph Nye. Nye (2008) describes public diplomacy as an instrument of soft power, a concept he developed that refers to the ability to attract, influence and shape preferences while avoiding force. As part of his definition, public diplomacy is broken into three dimensions: maintaining daily communication, strategic communication, and the development of lasting relationships with individuals through exchanges (Nye 2008: 101–102; Leonard 2009).

The value and efficacy of public diplomacy has long been the subject of debate. Detractors such as Krebs and Edelstein (2005) claim it is useless if foreign publics fundamentally do not like a government’s foreign policies. Using the US as a case study, they highlight the early 2000s as a time when frenetic public diplomacy efforts in the Muslim world post 9/11 yielded few results, as American policies remained unpopular throughout such countries. Accordingly, Krebs and Edelstein (2005) warn against placing too much faith in public diplomacy. Nye (2008) agrees that unfavourable attitudes towards a country’s policies, values or culture can mitigate public diplomacy efforts. However, as the originator of the concept of soft power, he is convinced of public diplomacy’s value and necessity, arguing that it creates an ‘enabling’ environment for potentially unpopular policies (Nye 2008). Public diplomacy, Nye (2008: 108) states, is an “important tool in the arsenal of smart power,” which combines elements of both soft and hard power. The debate more recently has largely moved on from questions about the value of public diplomacy (Gregory 2011: 355), perhaps because most governments now view public diplomacy as a standard component of wider diplomatic efforts (Zhang 2013: 1313). Given this shift, much of the literature is now focussed on how public diplomacy relates to public relations (L’Etang 2009; Rasmussen and Merkelsen 2012; Golan, Yang and Kinsey 2014), how it can be distinguished from propaganda (Bejesky 2012), and its characteristics (Gregory 2011; Cull 2008).

Public diplomacy 2.0

As social media has transformed individuals from passive message receivers to active participants, foreign public opinion has gained in significance (Zhong and Lu 2013; Wang 2006). Traditional public diplomacy involved one-way communication between states and publics, with some two-way communication in the form of exchanges; now, social media has made public diplomacy a decidedly two-way interaction (Wang 2006). Comments on embassy Facebook posts, for example, provide instant feedback. This new landscape is referred to as public diplomacy 2.0 (Cull 2013). Much of the literature on this new era concerns how diplomatic actors can best adapt. Zhang (2013) warns social media can pose both a threat and opportunity for public diplomacy. He argues for a strategic issue management process to guide usage. Khatib, Dutton and Thelwall’s (2011) study of US efforts to engage citizens in the Middle East though social media also concludes that more strategic thinking is necessary, to truly take advantage of the opportunities of public diplomacy 2.0. Criticisms of public diplomacy 2.0 mirror earlier criticisms about public diplomacy in general. Comor and Bean (2012) studied US efforts to engage with Muslim audiences overseas via social media and related technologies. They concluded these efforts were contrived, duplicitous and delusional, as no amount of engagement could assuage anger at American foreign policies – mimicking Krebs and Edelstein’s criticism on the first iteration of public diplomacy. Among the more enthusiastic voices is Philip Seib (2013), who writes about the equalising power of social media. Seib’s analysis focuses on how social media helps individuals challenge and communicate with governments, citing the role social media played in organising dissent during the Arab Spring. This, he suggests, has quickened the pace at which diplomacy must be conducted and has resulted in ‘real-time diplomacy’.

Gaps in public diplomacy 2.0 discourse

While Seib’s analysis focused on how social media boosts individuals’ abilities to interact with governments (a bottom-to-top interaction), this dissertation seeks to look at how such trends are playing out on a state-by-state level (a more lateral interaction). Just as individuals enjoy less power than states, power differentials exist between states in the international arena. Between Pakistan and the US, the latter is undeniably the more powerful. Empirical assessments of the varying abilities of countries to propagate narratives via public diplomacy, and the impact of social media on these efforts, remain scant in the literature. Zhong and Lu (2013) looked at US social media engagement in China, but did not compare its success or failure with reciprocal efforts by China in the US. Rawnsley (2012) assessed approaches to public diplomacy in China and Taiwan, but in relation to how each speaks to the rest of the world rather than to each other. There has in fact been little analysis on the public diplomacy of developing countries at all. Given these gaps in the discourse, the present study aimed to (1) examine the use of social media in public diplomacy (2) describe reciprocal patterns of engagement in states with a power differential, and (3) broaden our understanding of the public diplomacy 2.0 efforts of developing nations.

Pakistan and the US – an ideal model for testing social media’s ‘equalising’ power This paper concentrates on Pakistan and the US because (1) studies rarely focus on the public diplomacy efforts of developing countries; (2) little research has compared their efforts with

those of a developed country to test whether social media can indeed equalise power imbalances; and (3) Pakistan and the US make for a particularly interesting case study given the two are considered allies, but suffer a relationship fraught with a number of competing and converging interests (Rumi 2015). Pakistan has long relied on the US for aid, both military and economic, while the US has relied on Pakistan in its war on terror (Saeed 2015; Fair 2012). Pakistan’s continued support of militant groups like Lashkar-e-Taiba has soured relations – as has the US’s continued drone strikes in northwest Pakistan (Saeed 2015). The killing of Osama bin Laden by US Navy SEALS in the town of Abbottabad in 2011 further eroded notions of trust between the two, as the Pakistani military was kept in the dark about the operation (Ward 2012), while the US suspected Pakistan had been aware of bin Laden’s whereabouts all along and neglected to share information (Gall 2014).

These issues have resulted in a great deal of mistrust on each side. A Pew Research Poll conducted in 2014 showed 38 per cent of Pakistanis surveyed saw the US as their country’s top threat, while only 18 per cent of Americans polled had a favourable view of their so-called ‘ally’ (Rumi 2015; Pew Research Centre 2014). With so much mutual suspicion there is scope to analyse how well each country is managing to push its narrative and charm its target audience.

Of additional importance is that the Pakistani diaspora amounts to nearly one million people in the US, and many more Pakistanis desire to work and live there (Rumi 2014). It is this tension and contradiction in the relationship between the two countries that makes them an interesting case study for the assessment of public diplomacy efforts via social media. Both countries have also established the use of social media for public diplomacy as core goals (Sonenshine 2012; Ministry of Foreign Affairs n.d.). This additionally makes them a suitable case study to test whether social media can act as an equaliser between actors with varying levels of power.

Chapter two: Methodology Measuring success in public diplomacy

Public diplomacy is a long game and its efficacy is notoriously difficult to measure. Nye (2008: 101) writes efforts are “measured in minds changed, not dollars spent on slick production packages”. But individuals’ thoughts and ideas about a country are influenced by many factors. Isolating the effect of public diplomacy in this is near impossible (Richter 2012). Public diplomacy 2.0 suffers the same problem. The U.S. Department of State has developed criteria to assess its efforts on social media that analyse engagement (e.g. number of likes or comments on a Facebook post) and overall reach (e.g. number of followers) (US Advisory Commission on Public Diplomacy 2014). However the US Advisory Commission on Public Diplomacy (2014: 36) has noted this is not necessarily sufficient in explaining the impact such actions have on advancing perceptions of the US or its foreign policy. The Commission has called for further research on developing a more thorough methodology.

Social media monitoring and sampling

The Facebook pages of the Pakistan embassy in the US and the US embassy in Pakistan were monitored retrospectively in July and August 2015, covering all posts from 10 June 2015 to 10 July 2015. The study focused on the Facebook page of each embassy and not their Twitter activity as both have more followers on the former platform. Facebook is also the most

popular social media platform in both countries, and worldwide (Duggan et al., 2015; Iqbal 2013). The administrators of both pages were contacted via Facebook and email and asked to participate in this study, but neither replied.

Facebook content is not static, but usually has a predictable pattern of engagement whereby the majority of audience interaction occurs within a short window of publication. The exception to this is content that resurfaces virally, but no such behaviour was observed for any post on either Facebook page. Given posts were assessed approximately one month after publication, changes may have occurred in the intervening time (e.g. the embassy may have edited posts or deleted user comments; users may have deleted their own comments or un-liked a post). Without access to official engagement metrics available to the account administrators or software to extract information from these pages in real time, my retrospective and methodical sampling provides only a snapshot of Facebook activity over a one-month period, after sufficient exposure to the audience. Overall, this sampling provides a sense of how each page communicates with its target audience – detailed information on reception and especially impact (apart from what can be gleaned from Facebook comments), however, remains elusive. Measures of engagement and reach used by the U.S. Department of State were adopted here. Mutual criteria factoring in Pakistani and US definitions of engagement would have been ideal, but to my knowledge there is no published account of how the Pakistan Ministry of Foreign Affairs assesses its social media efforts. However, the goals of Pakistan’s public diplomacy efforts are known: the Ministry of Foreign Affairs (n.d.) lists building a “positive image”, projecting “Pakistan’s economy as a source of enterprise and innovation” and utilising “modern technology and communications networks to reach out” as its objectives. These are similar to goals stated on the U.S. Department of State’s (n.d.) website, which lists “informing and influencing foreign publics”, advancing “national interests” and “expanding and strengthening the relationship between the … United States and the citizens of the rest of the world”. Therefore several measures of engagement and reach (Table 1) were analysed to provide an indication of how well each embassy’s page communicated with its audience, with respect to their stated public diplomacy goals.

Table 1. Measures of Facebook activity and audience engagement used in this study

Measure Definition

Page A user’s online space within Facebook. In this study the users were the US embassy in Pakistan and Pakistan embassy in the US, and their pages were monitored.

Page likes/followers

People that have liked an overall Facebook page are considered followers of that page and will have page content delivered to them.

Posts A piece of content published by an administrator on to the embassy’s page.

Likes The number of people that click the ‘like’ icon on a post (thus showing their appreciation for it).

Comments The number of comments left by followers on an individual post.

Negative comments

Each comment was classified as negative or not negative. Comments were negative if they were critical of the country or post. Non-negative comments

include neutral, positive and spam comments.

Shares People can share posts to their own page and network. Sharing a post increases the number of subsequent people who see those posts.

To understand general messages on each page, posts were categorised according to 14 themes: Exchange (government or government-affiliated programs to connect citizens in both countries, including educational or cultural exchange programs); Aid; Disability rights; Education; Embassy business (official statements, announcements regarding meetings, events, facilities issues); Sports/entertainment; Food; Learning English; Muslims in the US (posts relating to the lives of Muslim Americans); Pakistani culture (Pakistani history and society); American culture (American history, society and events such as Independence Day); Women’s issues (empowerment); Pakistan economy; and Religion (including posts related to Ramadan or Jummah, which is the Muslim day of prayer, Friday). Some posts related to more than one theme, and were therefore categorised under a maximum of two themes.

Chapter three: Results An unremarkable month, diplomatically The sampling period from 10 June to 10 July 2015 did not involve any crises between the two countries, nor any major stories concerning trade or security. One development that would have been noted by the US was Pakistan’s ascension to a regional cooperation group led by China and Russia, the Shanghai Cooperation Organisation, on 10 July. This moves Pakistan closer to America’s traditional opponents (Kelly, Pinchuck and Korsunskaya 2015), but this development did not feature on any post. The most significant events to take place during the monitoring period were US Independence Day and the Muslim holy month of Ramadan, which began on 19 June. Both featured in a number of posts on both pages.

The lack of a crisis or major story concerning Pak-US relations does not negate the relevance of this study, as there has been a shift towards recognising that public diplomacy is as important in non-crisis times for the maintenance of good will (United States Advisory Commission on Public Diplomacy 2014: 12). This study therefore provides a representative sample of the day-to-day public diplomacy efforts of the two countries.

Social media overview The US embassy posted 87 times and the Pakistan embassy posted 20 times over the 31 days of sampling (Figs. 1–2). The US embassy posted content on 30 out of 31 days; the Pakistan embassy posted content on 12 days. In addition to differences in posting frequency, the Facebook communities of the embassies differed in size and engagement (Table 2).

Figure 1. Facebook posting frequency by the US embassy in Pakistan (blue) and Pakistan embassy in the US (green) over a 31-day sample.

Figure 2. Total number of Facebook posts by the US embassy (blue bar) and the Pakistan embassy (green bar) over 31 days. Values above bars are the average number of posts per day.

2.8postsperday

0.7postsperday

0

20

40

60

80

100

Totalposts

USAPakistan

Table 2. Facebook sample and page and post characteristics

Parameter Pakistan US

Number of page likes/followers (as of 15 Aug 2015) 11,421 2,039,064

Total posts over 31 days (10 June–10 July 2015) 20 87

Total number of likes across all posts 84 282,105

Total number of comments across all posts 10 5,431

Total number of shares across all posts 6 18,607

Number of themes featured across all posts 7 13

Proportion of posts liked 95% 100%

Proportion of posts commented on 30% 100%

Proportion of posts shared 25% 78%

Total negative comments across all posts 2 74

Engagement and reach - Pakistan embassy page In terms of reach, the Facebook page of the Pakistan embassy in the US had 11,421 followers (Table 2). This number is miniscule when compared to the total number of Facebook users in the US, which was 156.6 million as of January 2015 (Statista 2015).

Of the 20 posts made by the Pakistan embassy, 95 per cent received some form of engagement (likes, comments or shares) (Table 2). While overall engagement across posts was high, average engagement on each post was low: each post was liked just four times on average, received 0.6 comments, and was shared 0.3 times.

The post with the highest level of engagement all month garnered 14 likes, three comments and one share (Fig. 3). Sixty per cent of Pakistan’s posts included a photo or video, and all were written in English. The Pakistan embassy’s page received two negative comments during the month – but because of the low overall number of comments, this represented 20 per cent of all comments on the page.

Figure 3. The post with the highest level of engagement (14 likes, three comments, one share) on the Pakistan embassy Facebook page over a one-month period. This is represented as it appeared on the page (e.g. truncated image).

Engagement and reach – US embassy page

With over two million followers (Table 2), the US embassy’s Facebook page appears to reach a sizable portion of the number of Facebook users in Pakistan, which numbered around 8.06–11.8 million people in 2013, the most recent year for which figures are available (Statista 2013; Nasir 2013).

Of the 87 posts in this sample, 100 per cent received some form of engagement and each form of engagement was strong across posts (Table 2): posts were liked by an average of 3,206 people, received an average of 62 comments, and were shared, on average, 211 times (Table 3). The post with the highest level of engagement had 48,501 likes, 509 comments, and 8800 shares (Fig. 4). All but one of the US embassy’s posts included a photo or video. Most posts were written in English, although ten per cent were in Urdu (nine of 87 posts). Negative comments amounted to 74 out of 5,431 total – or 1.4 per cent of all comments (Table 2).

Figure 4. The US embassy post with the highest level of engagement (48,501 likes, 509 comments, 8800 shares). This post was part of a series showcasing mosques in the US. The text roughly translates to “Mosques in rural and urban America - 9 July 2015 | ShareAmerica [Getty] - America’s largest mosque is located in Dearborn, Michigan. It was established as the Islamic Centre of America and was built in 2005. It is adorned with ten-story minarets and can accommodate up to 1000 worshippers.”

Engagement as a proportion of community size

The US embassy page had 181 times more followers than the Pakistan embassy page (Table 2), so all measures of net engagement are bound to be higher. For this reason it is essential to express engagement and reach as a proportion of each community’s size (the number of its followers) (Table 3).

Table 3. Engagement expressed in terms of each embassy’s Facebook community

Pakistan US

Likes Comments Shares Likes Comments Shares

Total across all posts 84 10 6 282,105 5,431 18,607

Average per post 4 0.06 0.3 3,206 62 211

Average per post expressed as a proportion of total

community 0.04% 0.005% 0.003% 0.16% 0.003% 0.011%

It may come as a surprise to see that a slightly larger percentage of the Pakistan embassy’s followers commented on posts, compared to the US embassy’s community of followers (Table 3). However, this may be explained by spam comments (e.g. comments linking to other pages or advertising services). The paucity of total comments on the Pakistan embassy page meant that spam comments formed a larger proportion of overall engagement, whereas spam on the US embassy page was mostly drowned out by the higher volume of legitimate comments.

Thematic patterns The US embassy consistently posted about exchange opportunities and about Muslims in the US (Fig. 6), using the occasion of Ramadan to highlight the lives of Muslim Americans. On the final day of monitoring, there was a major push to promote the size of the American Muslim community, with eight out of the ten posts that day showcasing various mosques around the country. These posts were all in Urdu, save for one, and included eye-catching pictures of mosques (Fig. 4). They received some of the highest levels of engagement all month and comments were overwhelmingly positive.

Pakistan’s posts consistently focused on improvements in its economy and on day-to-day embassy business (Fig. 6). Ramadan may have played a role in the fact that Pakistan did not post on a majority of days during the month, as staff may have taken a break during the Muslim holy month. It is also possible the embassy simply does not place a priority on posting on Facebook every day. Posts on both pages tended to avoid mentioning hard-news stories or contentious foreign policy issues. Of course all posts served an over-all political purpose – that is indeed the purpose of public diplomacy, to cultivate favourable opinions – but overt politics were mostly avoided. On the Pakistan embassy page, the most overtly political or ‘newsy’ post was one welcoming the normalisation of relations between Cuba and the US (Fig. 5A). No other news stories were mentioned, apart from stories from the financial press relating to positive developments in the Pakistani economy.

Posts by the US embassy focused more on human interest topics, such as women’s empowerment, sport/entertainment and Ramadan. The most ‘newsy’ post was one congratulating the US women’s soccer team for their World Cup win on 6 July (Fig. 5B). A number of US posts also posed questions to followers to encourage engagement. Some of these posts assumed a moralistic or didactic quality, which was not mimicked in Pakistan embassy posts (Fig. 5C–D).

A

B

C

D

Figure 5. A selection of posts demonstrating styles used by the two embassies. A, the only ‘hard’ news-related post by the Pakistan embassy. B, an example of a ‘newsy’ post by the US embassy. News-related posts were generally avoided by both embassies. C and D, examples of US embassy posts raising moral and social issues.

The US embassy also posted on a wider range of topics compared to the Pakistan embassy (Fig. 6). The four main themes discussed by the US embassy were exchange, Muslims in the US, religion and Pakistani culture. There was some overlap between religion and Muslims in the US as the US embassy used Ramadan as an opportunity to highlight the lives of Muslims in the US. Thus, some posts were classified as comprising both themes. There also seemed to be a specific push to highlight disability rights during the month, with nine per cent of posts related to disability issues (Fig. 6).

Figure 6. Themes discussed by the US embassy in Pakistan (blue bars) and the Pakistan embassy in the US (green bars) on their Facebook pages over one month. See Methodology for definitions of each theme. Total percentages across categories exceeds 100 per cent because posts may discuss more than one theme.

Three main themes dominated posts by the Pakistan embassy, none of which dominated US embassy content; these were embassy business, Pakistan economy, and US culture. More than half of all posts (55 per cent) concerned embassy business (Fig. 6). Thirty per cent of posts focused on positive developments in the Pakistani economy, something no US embassy post discussed. These posts mainly shared articles from the Wall Street Journal or Bloomberg. One in five posts by the Pakistan embassy were about US culture; however, most of these concerned Independence Day, the occurrence of which may have resulted in a more exaggerated number of posts in this category than usual. No posts featured women’s issues, disability rights, Pakistani culture, food, learning English or Muslims in the US.

Negative sentiment While the proportion of negative comments on the US embassy page was low (1.4 per cent of all comments or 74 of 5,431 comments), of note is that one post generated more than a third of all negative comments: a post on World Refugee Day received an outburst of 27 negative comments (Fig. 7).

0%

10%

20%

30%

40%

50%

60%Pe

rcen

tofp

osts

USA Pakistan

Figure 7. A post by the US embassy on World Refugee Day was responsible for more than one third of negative user comments over the month.

On the Pakistan embassy page, only two negative comments were observed during the month; however, as a proportion of the total number of comments (10, which includes neutral comments and spam), this amounted to 20 per cent (Fig. 8).

A

B

Figure 8. The two Pakistan embassy posts that generated the only two negative comments during the month.

Limitations and notes on referencing

As an observer without access to metrics available to page administrators, I am unable to describe the nature and profile of followers of each page. Access to this information would allow a fuller understanding of the demography of each community and their geographic location. For example, it is likely that not all followers of each page reside within the target country and this is an inherent aspect of online platforms. Posts on both pages also received spam comments (often in the form of another page advertising services) and these were not excluded by the methodology used in this study – posts were simply classified as negative or not negative. A more comprehensive assessment of comments would involve classifying each one on a scale of positive to negative. Further, most measures of engagement are not a set of unique user records as I was unable to control for the same user interacting with a post in more than one way (e.g. liking as well as sharing a post). Consequently, any measure of community involvement is not a strict measure of the proportion of unique users that engaged with content. This is not a major concern as the questions raised by this study are about comparing patterns of engagement, methods of social media diplomacy and thematic differences in narratives and is not intended to be an absolute measure of social media performance for each embassy.

It is also possible that some positive comments on each page were staged. While this was not considered in this study, the potential use of deception and ‘stage-managing’ in social media public diplomacy would benefit from further study. Finally, there is no widely agreed format for referencing comments left on Facebook pages. Therefore comments are referenced in text citing the full name of the commenter, date of posting, and the embassy page.

Chapter four: Discussion Narrative

Using the assumption that “politics in an information age ‘may ultimately be about whose story wins” (Arquilla and Ronfeldt 1999, cited in Nye 2008: 100), it is worth scrutinising the narratives crafted by each page, and the receptivity of the target audiences. The themes discussed differed widely between the two pages. US embassy posts focused predominantly on exchange programs, the lives of Muslims in the US, and religion (Fig. 8); Pakistan embassy posts focused on embassy business (such as official statements and events), positive developments in the Pakistani economy, and US culture (Fig. 8). If the key messages being pushed by each country were to be summed up in a sentence, Pakistan’s might read, “we are improving, our economy is on the mend, and we are a democracy just like you – we are not so bad!” This assessment is supported by the fact that the Pakistan Foreign Ministry lists promoting the “open and tolerant culture of Pakistan” and projecting “Pakistan’s economy as a source of enterprise and innovation” as part of its public diplomacy objectives (Ministry of Foreign Affairs n.d.). The US embassy’s message might read, “we are not Islamophobic, there are plenty of Muslims in America (we are tolerant!), so come and learn from us through one of our exchange programs”. This assessment is supported by the fact that engaging Muslim audiences worldwide has been a major priority for the US since 9/11 (Douglas and Neal 2013). Figure 9 gives examples of posts that contributed to crafting these messages.

A

B

Figure 9. Representative examples of the dominant narratives on the Facebook pages of (A) the Pakistan embassy in the US, and (B) US embassy in Pakistan.

These official narratives run contrary to widely held beliefs in each country about the other. Pakistanis have many reasons to believe that the US is not necessarily a friend of Muslims (Afzal 2013), while in the US, Pakistan is more likely to be associated with extremism and militancy, rather than economic dynamism. With this in mind, it is interesting to note the varying levels of success the two pages experienced in pushing their preferred narratives. It appears the US is far more effective: not only does it have a larger number of followers to target with its narrative, it also receives far higher levels of engagement. Engagement offers proof that followers have seen and received the messages being posted. Net levels of engagement are sufficient from a public diplomacy perspective because the goal is to have as many people as possible view your message. However, even when comparing levels of engagement as a proportion of each Facebook page community the US continues to lead. All posts by the US embassy were liked and commented on during the month, and the vast

majority were shared. While all posts by the Pakistan embassy did have at least one user engage with them, net levels and proportional levels of engagement were low. This demonstrates that the US Embassy had far more success getting its key messages seen by followers. Thus on the comparable goals of “informing and influencing foreign publics” and “building a positive image” (the former a stated US public diplomacy goal, the latter a Pakistan one) (Ministry of Foreign Affairs n.d.; U.S. Department of State n.d.), Facebook appears to have given the US a bigger boost than Pakistan – insofar as influencing someone’s opinion requires them to first be exposed to the influencing messages.

Likes, shares and comments are not created equal The disparity in how often posts on the two pages were liked, commented on, and shared is even more illustrative of a success differential when considering the quality of each form of engagement. Liking a post requires minimal effort and a quick click performs this task. It can therefore be considered the easiest form of Facebook engagement and was indeed the most common way users engaged with content on both pages. Commenting requires a higher level of effort, as the follower is required to read the post, form an opinion, and care enough to write a response. Comments also give a sense of whether a follower has positively or negatively received a message, making them a better tool for assessing reception. Finally, sharing a post takes arguably the most amount of user effort. One must really like (or hate) a post to be motivated enough to take it outside the confines of the embassy page and share it with their own network of friends. This transforms an individual from a passive follower, to a fellow broadcaster of embassy messages – vastly expanding the number of people a post can potentially reach.

When considering how often posts on either page received any of these forms of engagement, the US embassy’s audience is more engaged and active (Tables 2–3). The majority of US posts were shared (with an average of 215 shares per post), indicating that its narrative travelled further than Pakistan’s, for whom only one in four posts were shared. This pattern suggests that Facebook has not equalised power differences between the two countries - instead the status quo appears to be maintained, in which the American narrative continues to dominate.

Sentiment To determine how key messages or narratives were received, an analysis of comment sentiment is useful. The US embassy received a higher net number of negative comments, but this was a smaller fraction of total comments. The Pakistan embassy received very few negative comments, but this number represented 20 per cent of total comments (Table 2). One might reasonably assume that both pages often delete negative comments. However, the US embassy has publically stated that it does not do this (Hanson 2013). Indeed, comments ranging from the bizarre to angry remain on the page:

“There was an American CIA program to help women embarrass and demean their husband's so that they die. Visa for U. S, or any where for females alone provided by this program” (sic.) (Naveed Ghauri, 20 June 2015, US embassy page).

“Wow! What a hipocracy one side you have a agenda to destroy islam & muslims(impossible) and on other side sayin ramdan mubarak” (sic.) (Syed Hassan Askari, 18 June 2015, US embassy page).

It is unclear whether the Pakistan embassy deletes certain negative comments, but the fact that critical comments remained on the page suggests a lack of censorship. For example, in response to a 6 July post announcing that the Pakistani Ambassador had met with a US senator to discuss ‘positive developments’ in the Pakistan-US relationship, a follower wrote a particularly damning comment highlighting the lack of security and basic services in Pakistan (see Fig. 8B for full comment). Yet this comment remains on the page. On the US embassy page, apart from mainly positive comments, many also demonstrated that followers had internalised the intended message. For example, the series of eight posts on 10 July showcasing mosques around the US received the highest engagement all month, with hundreds of comments lauding religious freedom in the US. Of the 877 comments left on these eight posts, only three were negative. This comment is illustrative of the majority:

“Salute to America. Muslims in their own countries do not have as much freedom as they have in America” (Sohail Qureshi, 10 July 2015, US embassy page).

Another follower said he was pleased to learn about the mosques and planned to share the photos with people in his community, offline. Such comments suggests that (1) the US embassy Facebook page is effectively serving one of the key purposes of public diplomacy, which is to cultivate favourable opinions (Wang 2006: 91) and (2) that the State Department goal of using public diplomacy to influence and inform foreign publics is also being achieved. In contrast, the post with the highest engagement on the Pakistan embassy page was not even aligned to its broader narrative. The post simply announced the inauguration of a machine readable passport facility at the embassy (Fig. 8A). Of the three comments, only one was fully positive, another said it was about time such facilities were introduced as developed countries have long had them, and the third lamented the inauguration ceremony as a waste of money. For a post with the highest level of engagement during the month, this was a rather lacklustre reception.

Posts aligned to the Pakistan embassy’s key messages had even less success. Six out of the 20 posts over the month focused on the Pakistani economy. All were liked at least once, but only one was shared and commented on (the post in Fig. 9A). The comment, however, was one of the more bizarre examples of spam, simply linking to a suicide factsheet issued by the US Center for Disease Control and Prevention. Clearly, the attempt to push a positive narrative regarding Pakistan’s economy utterly failed to excite or engage followers in any meaningful way. Further qualitative evidence that the US embassy’s narrative was more successful at influencing and enticing followers is the fact that many users regularly commented to ask for visas to travel, study, work or live in the US. The majority of posts on the US page appeared to have at least one such comment. No such comments from followers seeking to travel to Pakistan were observed on the Pakistan embassy page. This is illustrative of Nye’s concept of soft power and public diplomacy working hand-in-hand, where soft power is the ability to attract others through charm rather than force, and public diplomacy is a tool for mobilising such power (Nye 2008: 95). While the display of Pakistanis’ desires to travel to the US may be a symptom of a lack of security and opportunity in Pakistan, it also suggests that the US still holds a particular pull as a land of opportunity. Indeed, many posts relating to exchange

opportunities (educational and otherwise) on the US embassy page actively fostered this notion. In short, The US embassy’s narrative not only reached more people, comments on its page suggest many followers also internalised the intended messages. The Pakistan embassy’s narrative, however, failed to reach a comparable number of people, and did not appear to influence or engage many followers.

Listening: Pakistan is missing out on social media opportunities Public diplomacy is about more than just selling a particular narrative. Nye (2008: 103) writes that effective public diplomacy is a “two-way street that involves listening as well as talking,” as it is necessary to understand what is going on in the minds of others in order to build relationships. Seib (2013: 10) notes that listening to global publics “can provide invaluable insights about social and political attitudes, which can allow diplomats to more precisely evaluate the environments in which they work”. Cull (2008) further describes listening as one of the key functions of public diplomacy, although it has often been neglected. Social media has been hailed as a particularly helpful tool for listening, as it gives states direct insight into what individuals are thinking and doing (Hanson 2012). Comments on embassy Facebook posts, for example, can indicate what the public is thinking. This kind of information was previously unavailable to diplomats, and can provide useful early warnings for potential problems (Hanson 2012). However, it is only possible to listen if people are actually talking to you. The Pakistan embassy’s Facebook page struggled with this on a number of fronts. Firstly, the page had few followers to begin with: 11,421 at the time of this study, which is minor compared to the total number of Facebook users in the US: around 156.6 million (Statista 2015). This very limited pool of US followers cannot provide Pakistan with a broad sense of what the public is thinking or concerned about. Contrast this with the US embassy’s more than two million followers, an impressive community in its own right, but even more so when one considers the total number of Facebook users in Pakistan is at least 8.06–11.8 million (Statista 2013; Nasir 2013).

Secondly, among the followers the Pakistan page did have, not much ‘talking’ in the form of comments actually took place. The page averaged 0.57 comments per post – meaning many posts attracted no comments at all. In fact during the entire month, followers commented on only 30 per cent of posts. In contrast, every post by the US embassy received comments.

In addition to illustrating when key messages have been internalised, comments provide an idea of other issues that may be on followers’ minds. This was certainly the case on the US embassy page. On the 20 June post trumpeting the US intake of refugees as the highest in the world (Fig. 7), while many comments were negative, three separate followers also commented to suggest that the US could do more to help Rohingya refugees in Myanmar. This may not constitute a critical mass, but it at the very least suggests the plight of Rohingya Muslims is on the radar of some Pakistanis. If the embassy was interested in finding out whether a wider section of the public shared such concerns, further research could be conducted. In this way, comments provide valuable insights into social and political attitudes, by acting as a tip off about what many more people may be thinking (Seib 2013). This is another benefit of social media 2.0 (Seib 2013) that the Pakistan page missed out on, through a lack of engagement on its page.

Negative comments can also prove informative when it comes to listening to foreign publics. Many of those who posted such comments on the US page called out perceived hypocrisies

between US words and actions. Taking the 20 June refugee posts as an example again (Fig. 7), many users wrote messages like this: “Do you know America is the reason why most of the people are refugees? Afghanistan? Libya? Iraq? And so many.. well this page won't hear the truth” (sic.) (Mahoor Awan, 20 June 2015, US embassy page).

For those listening at the embassy, it is unlikely to come as a surprise that some Pakistanis feel this way, but monitoring and tracking negative comments like these over time could give an indication of whether public opinion is swaying in an overall positive or negative direction. Again, the Pakistani embassy can glean no such insights, as the dearth of comments on its posts means it has far fewer opportunities to understand what is on the minds of its target audience.

Another issue blocking Pakistan’s ability to listen to the wider US public is that nearly all of those who do engage on its page appear to have Muslim or Pakistani-derived names. This suggests that the embassy is only really managing to speak to the Pakistani diaspora. Out of all the comments posted on the Pakistan embassy Facebook page during the month monitored, all expect one came from a follower with a Muslim name. This may not entirely be a negative trait – the diaspora may indeed be a specific target audience for the Pakistan embassy, particularly as remittances from this group amounted to approximately $1.1 billion in 2012 alone (Migration Policy Institute 2015, p.2). However, on the task of connecting with and hearing from the wider US public, Facebook does not appear to be giving the Pakistani embassy much success.

Factors influencing success and failure on Facebook

Disparities in the levels of engagement on each page could partly be the result of varying levels of sophistication in each country’s Facebook strategy. Pakistan did not post on the majority of days during the month, while the US posted every day expect for one. All but one post on the US embassy page included a picture or video, whereas only 60 per cent of Pakistani posts featured a visual element. Frequency of posts and the use of visuals have been linked to increase engagement (Sabate et al. 2014) and so this may be a factor in why the Pakistan embassy received less interaction. The US embassy has also publically stated that it makes an effort to “post content at regular intervals, primarily in the evenings when our audience is online”, and most posts seek to elicit “questions or comments that can easily be addressed” (Hanson 2013). This appears to be an effective strategy. For example, the series of posts highlighting mosques in the US were sent in thirty-minute intervals between 8pm and 11pm local Pakistan time. Seven out of these eight posts were in Urdu (a good way of reaching a larger number of people in Pakistan) and each included striking pictures of the mosques. It is no surprise they garnered the highest levels of interaction all month. Such a sophisticated strategy is possible because the US has vast resources dedicated to supporting its social media public diplomacy efforts. The series of mosque photos, for example, came from the State Department’s ShareAmerica platform, which attempts to engage people around the world through social media (ShareAmerica n.d.). In fact the content of many posts throughout the month came via ShareAmerica or other affiliated sources, such as US consulates around Pakistan. Further, within the State Department exists a dedicated office for public diplomacy, within which sits a section dedicated to generating social media content for embassies around the world, called the Bureau of International Information Programs. The ShareAmerica platform was developed by this bureau (ShareAmerica n.d.).

This network of resources for analysing and creating engaging and original content enables the US embassy to receive more interaction on its Facebook page - and thus more opportunities to ‘listen’ to its target audience, and push its narrative.

The Pakistan embassy page appears to have no such support network. Little information could be found regarding its social media strategy, apart from one line written about it on the Foreign Ministry’s public diplomacy page, which establishes the goal of using “modern communications technology to reach out” (Ministry of Foreign Affairs n.d.). Indeed, all that appears to be publically written about Pakistan’s public diplomacy strategy is the 108 words dedicated to this on the Foreign Ministry website. Given the lack of a comparable support network, it is unsurprising that content on the Pakistan page was less sophisticated. Many posts simply shared articles from news websites such as Bloomberg or The Wall Street Journal. Any original content consisted almost entirely of re-posts from the embassy’s Twitter feed, without alteration so as to better adapt the message for Facebook. Nearly all posts were similar to this one: “Amb @JalilJilani & Annette Dixon VP @WorldBankSAsia signing the 2nd Fiscally Sustainable & Inclusive Growth DPC” (Embassy of Pakistan, Washington DC 2015). Such a post is rather nonsensical on Facebook, where Twitter handles beginning with @ do not function as a way to ‘tag’ or connect other users, as they do on Twitter. And why restrict oneself to 140 characters when Facebook allows far more flexibility? The above post surprisingly received eight likes and one comment (not great, but on the higher end for post engagement in the sample). A commenter, named Rana Tufail, wrote “Jazak allah” (sic.) which roughly translates to ‘may Allah reward you’. Tufail, however, lives in Pakistan according to his Facebook profile, so does not really fit the embassy’s target audience. All users who liked this post also had Muslim-derived names, suggesting they were either members of the Pakistani diaspora, or living in Pakistan. It is perhaps unsurprising that such lacklustre content failed to reach or engage the wider US public. Indeed, the presence of Twitter handles in nearly all Pakistan embassy posts suggests it is yet to adopt a proper strategy for engaging followers on Facebook. This is surprising given it has more followers on Facebook than Twitter (over 11,000 versus 9,600), and that using “modern communications technology to reach out” is one of its public diplomacy goal (Ministry of Foreign Affairs, n.d.). The Pakistan embassy established its Facebook page in 2012, yet three years later this goal requires significant work. All of this supports the argument that social media cannot be blithely considered an equaliser in its own right – wider factors relating to existing imbalances in resources and know-how influence outcomes on social media. Although both embassies have Facebook pages, it is clear only the US is really benefiting from the opportunity the platform presents to both push its narrative, and listen to its audience. Pakistan, for a myriad of reason including a less sophisticated strategy, and perhaps a lesser understanding of social media best practice, is not succeeding.

Productive power at play

In Barnett and Duvall’s conception of the various forms of power, productive power concerns how the “social capacities of actors are socially produced, and how these processes shape actors’ self- understandings and perceived interests” (2005: 55). This kind of power is diffuse, making it harder to identify, but it manifests in all manner of interaction: language, systems of knowledge, the narratives we tell about ourselves, and other factors, all of which influence the kinds of options available to actors. These differences in the “capacity and inclination for

action” between socially advantaged and disadvantaged actors is how productive power is expressed (Barnett and Duvall 2005: 56). Thus, those who dominate the discourse tend to dominate the narrative.

Given that Facebook and social media in general is a product of US innovation, it is unsurprising that the US government has a better understanding of how to leverage it for public diplomacy ends. Their ability to recognise value in developing a social media strategy and continuously reviewing and refining it, is an advantage borne out of their productive power. Their cultural dominance worldwide, which enabled social media to become a global phenomenon, also allows them to continue dominating the narrative.

Further, the fact that there are dozens of academic studies focusing on the American use of social media for public diplomacy, but none on Pakistan’s efforts, means the US benefits from a tradition and body of research and knowledge that is unavailable to Pakistan. Thus, the social media savvy of the US embassy in Pakistan is not an accident – it is the result of US productive power. As such, the Pakistan embassy’s less sophisticated approach to Facebook is unsurprising. What chance does it stand of beating the US at its own game, or even playing in the same league? These complexities are why it is simplistic to suggest social media can act as a “great equalizer” (Seib 2013: 6). Social media may have indeed introduced a new way for various actors to communicate – but whether this has had an equalising, amplifying or null effect on existing patterns is another matter. The data collected here suggests that at best, there has been no impact on levelling the ability of Pakistan and the US to successfully push their narratives or carry out the listening function of public diplomacy. Instead, familiar power dynamics prevail, with the US continuing to be the dominant actor.

However, it may go further – social media may in fact be amplifying this existing pattern of US dominance. Sverjensky (2012: 241) writes about the digital divide, defined as the gap between individuals, households and even entire countries in terms of their opportunities to access information and communication technologies, and their use of the internet (OECD n.d.). Sverjensky (2012: 241) argues that the “divide over the use of new technologies increasingly reflects whether people are capable of understanding the Information Society that surrounds them” and that “early adopters of many new technologies or applications, such as social media, are automatically poised to benefit” – as those who start from behind tend to stay behind, because in the time it takes to catch up, early adopters have also moved ahead. This is particularly the case when it comes to more sophisticated uses for such technologies, which hold greater rewards. Sverjensky (2012: 241) cites the examples of using a mobile phone to send a text message, which is relatively simple, versus setting up a website or establishing a digital presence for a business (or indeed a state). Income inequality is cited as one of the key drivers of the digital divide.

Sverjensky’s analysis does not bode well for the Pakistan embassy’s prospects for meeting its public diplomacy aims via social media. It launched its Facebook page in 2012, when the US embassy in Pakistan already had a two-year head start, having launched its Facebook page in 2010. This is two years of extra time that the US had to push its narrative in Pakistan via social media, while Pakistan’s voice in the US was silent on Facebook. Clearly, three years after its launch, the Pakistan page continues to trail the US in terms of sophistication of content, engagement and reach. The lack of regular and visually engaging posts on the Pakistan embassy page also suggests Pakistani public diplomacy staffers may not fully understand the social media ecosystem and how to use the platform most effectively – supporting Sverjensky’s suggestion that the digital divide is increasingly reflected in whether

actors are capable of understanding the “Information Society that surrounds them” (2012: 241). This is a major problem if politics in an information age is indeed ultimately about “whose story wins” (Arquilla and Ronfeldt 1999, cited in Nye 2008: 100). In the time it may take the Pakistan embassy page to achieve the same level of success as the US embassy page, the US will already have benefited from years of insight into the minds of its target audience and years of consistently broadcasting its narrative. For Pakistan, catching-up would require a concerted effort to devote far greater resources towards social media public diplomacy efforts. As a poorer country compared to the US, it is less likely to be able to do this. Thus, Pakistan could potentially remain chronically behind in the race to establish a dominant narrative on social media. This is how Facebook and social media in general may in fact be acting as an amplifier of existing patterns, by functioning as a megaphone for the most capable or powerful actors. For the less powerful, it appears to be just another space in which to lag.

Conclusion This study demonstrates how conceptualising social media as an equaliser, particularly in the arena of public diplomacy, is a simplistic approach. In the case of Pakistan and US efforts on Facebook, social media has at best had a null effect on shifting existing patterns of power. At worst, this informational ecosystem may be helping to reinforce or amplify historical patterns of power. This empirical and qualitative attempt at describing patterns of public diplomacy in two disparate states goes some way to addressing deficits in public diplomacy 2.0 literature, and lays a foundation for further work aimed at understanding the real-world impacts of public diplomacy 2.0.

Bibliography Afzal, M., 2013. Drone Strikes and Anti-Americanism in Pakistan. [online] 7 February

Available at: <http://www.brookings.edu/research/opinions/2013/02/07-drones-anti-americanism-pakistan-afzal> [Accessed 23 August 2015].

Arquilla, J. and Ronfeldt, D., 1999. The Emergence of Noopolitik: Towards an American Information Strategy. [pdf] Santa Monica: RAND. Available at: <http://scholar.google.it/scholar_url?url=http://www.dtic.mil/cgi-bin/GetTRDoc%3FAD%3DADA363442&hl=en&sa=X&scisig=AAGBfm1ia4qQ7Ay5kw7a71wGvcVW6wem2g&nossl=1&oi=scholarr&ved=0CCQQgAMoADAAahUKEwjU2tu0jdjHAhUk8HIKHV8mC4Q> [Accessed 20 August 2015].

Barnett, M. and Duvall, R., 2005. Power in International Politics. International Organization, [e-journal] 59(1), pp.39-75. Available through: SOAS Library website <https://www.soas.ac.uk/library/> [Accessed 20 August 2015].

Bejesky, R., 2012. Public diplomacy or propaganda? Targeted messages and tardy corrections to unverified reporting. Capital University Law Review, [e-journal] 40, pp.967-1099. Available through: SOAS Library website <https://www.soas.ac.uk/library/> [Accessed 1 August 2015].

Christensen, C., 2011. Twitter Revolutions? Addressing Social Media and Dissent. The Communication Review, [e-journal] 14(3), pp.155-157. Available through: SOAS Library website <https://www.soas.ac.uk/library/> [Accessed 5 August 2015].

Comor, E. and Bean, H., 2012. America’s ‘engagement’ delusion: Critiquing a public diplomacy consensus. International Communications Gazette, [e-journal] 74(3), pp.203-220. Available through: SOAS Library website <https://www.soas.ac.uk/library/> [Accessed 4 August 2015].

Cull, N. J., 2008. Public Diplomacy: Taxonomies and Histories. Annals of the American Academy of Political and Social Sciences, [e-journal] 616, pp.31-54. Available through: SOAS Library website <https://www.soas.ac.uk/library/> [Accessed 2 July 2015].

Cull, N. J., 2013. The Long Road to Public Diplomacy 2.0: The Internet in US Public Diplomacy. International Studies Review, [e-journal] 15(1), pp.123-139. Available through: SOAS Library website <https://www.soas.ac.uk/library/> [Accessed 2 July 2015].

Douglas, W. and Neal, J., 2013. Engaging the Muslim World. [pdf] Washington DC: Center for Strategic & International Studies. Available at: <http://csis.org/files/publication/131011_Douglas_EngagingMuslimWorld_Web.pdf> [Accessed 20 August 2015].

Duggan, M., Ellison, N. B., Lampe, C., Lenhart, A. and Madden, M., 2014. Social Media Update 2014. [pdf] Washington DC: Pew Research Center. Available at: <http://www.pewinternet.org/files/2015/01/PI_SocialMediaUpdate20144.pdf> [Accessed 18 August 2015].

Edelstein, D. M. and Krebs, R. R., 2005. Washington’s Troubling Obsession with Public Diplomacy. Survival, [e-journal] 47(1), pp.89-104. Available through: SOAS Library website <https://www.soas.ac.uk/library/> [Accessed 18 July 2015].

Embassy of Pakistan, Washington DC, 2015. Embassy of Pakistan, Washington DC [Facebook]. 10 June – 10 July 2015. Available at:

<https://www.facebook.com/PakistanEmbassyDC?fref=ts> [Accessed 1 July 2015].

Fair, C., 2012. The US-Pakistan relations after a decade of the war on terror. Contemporary South Asia, [e-journal] 20(2), pp.243-253. Available through: SOAS Library website <https://www.soas.ac.uk/library/> [Accessed 21 July 2015].

Gall, C., 2014. What Pakistan Knew About Bin Laden. The New York Times, [online] 19 March. Available at: <http://www.nytimes.com/2014/03/23/magazine/what-pakistan-knew-about-bin-laden.html> [Accessed 20 July 2015].

Golan, G.J., Yang, S.U. and Kinsey, D., 2014. International Public Relations and Public Diplomacy: Communication and Engagement. [e-book] New York: Peter Lang. Available through: SOAS Library website <https://www.soas.ac.uk/library/> [Accessed 21 July 2015].

Gregory, B., 2011. American Public Diplomacy: Enduring Characteristics, Elusive Transformation. The Hague Journal of Diplomacy, [e-journal] 6(3), pp.351-272. Available through: SOAS Library website <https://www.soas.ac.uk/library/> [Accessed 18 July 2015].

Hanson, F., 2012. Public Diplomacy. [online] Available at: <http://www.brookings.edu/research/reports/2012/10/25-ediplomacy-hanson-public-diplomacy> [Accessed 1 July 2015].

Hanson, F., 2013. The US Embassy Pakistan: The First to Pass One Million Fans on Facebook. [blog] 5 June. Available at: < http://www.brookings.edu/blogs/up-front/posts/2013/06/05-us-embassy-pakistan-facebook-hanson> [Accessed 1 July 2015].

Iqbal, S., 2013. Why social media in Pakistan is unlikely to spark an ‘Arab Spring’. BBC Academy, [online] 31 January. Available at: <http://www.bbc.co.uk/blogs/collegeofjournalism/entries/1f811091-1f17-3144-b35d-9fe854e116b1> [Accessed 18 August 2015].

Kelly, L., Pinchuk, D. and Korsunskaya, D., 2015. India, Pakistan to join China, Russia in security group. Reuters, [online] 10 July. Available at: <http://www.reuters.com/article/2015/07/11/us-china-russia-idUSKCN0PK20720150711> [Accessed 2 August 2015].

Khatib, L., Dutton, W. and Thelwall, M., 2012. Public Diplomacy 2.0: A Case Study of the US Digital Outreach Team. The Middle East Journal, [e-journal] 66(3). Available through: SOAS Library website <https://www.soas.ac.uk/library/> [Accessed 21 July 2015].

Leonard, M., 2009. Diplomacy by Other Means. Foreign Policy, [online] Available at: <http://foreignpolicy.com/2009/11/09/diplomacy-by-other-means/> [Accessed 15 July 2015].

L’Etang, J., 2009. Public Relations and Diplomacy in a Globalized World: An Issue of Public Communication. American Behavioral Scientist, [e-journal- 53(4), pp.607-626. Available through: SOAS Library website <https://www.soas.ac.uk/library/> [Accessed 18 July 2015].

Melissen. J., ed., 2005. The New Public Diplomacy Soft Power in International Relations. Basingstoke: Palgrave Macmillan. Available through: SOAS Library website <https://www.soas.ac.uk/library/> [Accessed 2 July 2015].

Migration Policy Institute, 2015. The Pakistani Diaspora in the United States. Washington DC: Migration Policy Institute. Available at: <http://www.migrationpolicy.org/research/select-diaspora-populations-united-states#PK> [Accessed 18 August 2015].

Ministry of Foreign Affairs, Government of Pakistan, n.d. Public Diplomacy – Overview. [online] Available at: <http://www.mofa.gov.pk/content.php?pageID=overview> [Accessed 10 July 2015].

Nasir, S., 2013. Pakistan crosses 10 million Facebook users. The Express Tribune, [online] 25 September. Available at: <http://tribune.com.pk/story/609177/pakistan-crosses-10-million-facebook-users/> [Accessed 10 August 2015].

Nye, J. S., 2008. Public Diplomacy and Soft Power. Annals of the American Academy of Political and Social Sciences, [e-journal] 616, pp.94-109. Available through: SOAS Library website <https://www.soas.ac.uk/library/> [Accessed 21 July 2015].

OECD, n.d. Bridging the Digital Divide. [online] Available at: <http://www.oecd.org/site/schoolingfortomorrowknowledgebase/themes/ict/bridgingthedigitaldivide.htm> [Accessed 25 August 2015].

Pew Research Center, 2014. Global opposition to U.S. surveillance and drones, but limited harm to America’s image. [pdf] Pew Research Center. Available at: <http://www.pewglobal.org/files/2014/07/2014-07-14-Balance-of-Power.pdf> [Accessed 20 July 2015].

Rasmussen, R. K. and Merkelsen, H., 2012. The new PR of states: How nation branding practices affect the security function of public diplomacy. Public Relations Review, [e-journal] 38(5), pp.810-818. Available through: SOAS Library website <https://www.soas.ac.uk/library/> [Accessed 18 July 2015].

Rawnsley, G., 2012. Approaches to soft power and public diplomacy in China and Taiwan. Journal of International Communication, [e-journal] 18(2), pp.121-135. Available through: SOAS Library website <https://www.soas.ac.uk/library/> [Accessed 19 July 2015].

Richter, H. R., 2012. Web 2.0 and Public Diplomacy. In: Perry, J. and Costigan, S. S., ed. 2012. Cyberspaces and Global Affairs. [e-book] Farnham: Ashgate Publishing. Ch.7. Available through: SOAS Library website <https://www.soas.ac.uk/library/> [Accessed 21 July 2015].

Rumi, R., 2015. The Art of U.S.-Pakistan Relations. Foreign Policy, [online] Available at: <http://foreignpolicy.com/2015/01/26/the-art-of-u-s-pakistan-relations/> [Accessed 20 July 2015].

Sabate, F., Berbegal-Mirabent, J., Canabate, A. and Lebherz, P. R., 2014. Factors influencing popularity of branded content in Facebook fan pages. European Management Journal, [e-journal] 32(6) pp.1001-1011. Available through: SOAS Library website <https://www.soas.ac.uk/library/> [Accessed 20 August 2015].

Saeed. S., 2015. U.S.-Pakistan Relations: Seeing Other People. The Diplomat, [online] Available at: <http://thediplomat.com/2015/03/u-s-pakistan-relations-seeing-other-people> [Accessed July 20 2015].

Seib, P., 2013. Transcript - Real Time Diplomacy: Power and Politics in the Social Media Era. [pdf] London: Chatham House. Available at :

<http://www.chathamhouse.org/sites/files/chathamhouse/public/Meetings/Meeting%20Transcripts/090413Seib.pdf> [Accessed 2 July 2015].

Shirky, C., 2011. The Political Power of Social Media. Foreign Affairs, [online] Available at: <https://www.foreignaffairs.com/articles/2010-12-20/political-power-social-media> [Accessed 21 July 2015].

ShareAmerica, n.d. About Us. [online] Available at: <https://share.america.gov/about-us/> [Accessed 21 July 2015].

Sonenshine, T., 2012. Measuring the Public Diplomacy of the Future. [online] Available at: <http://www.state.gov/r/remarks/2012/201408.htm> [Accessed 21 July 2015].

Statista, 2013. Number of Facebook users in selected Asian countries as of January 2013 (in millions). [online] Available at: <http://www.statista.com/statistics/193056/facebook-user-numbers-in-asian-countries/> [Accessed 18 August 2015].

Statista, 2015. Number of Facebook users in the United States as of January 2015, by age group (in millions). [online] Available at: <http://www.statista.com/statistics/398136/us-facebook-user-age-groups/> [Accessed 18 August 2015].

Sverjensky, N., 2012. Digital Divide: The Reality of Information Haves and Have-Nots. In: Perry, J. and Costigan, S. S., ed. 2012. Cyberspaces and Global Affairs. [e-book] Farnham: Ashgate Publishing. Ch.17. Available through: SOAS Library website <https://www.soas.ac.uk/library/> [Accessed 21 July 2015].

United States Advisory Commission on Public Diplomacy, 2014. Data Driven Public Diplomacy. [pdf] Washington DC: United States Advisory Commission on Public Diplomacy. Available at: <http://www.state.gov/documents/organization/231945.pdf> [Accessed 5 July 2015].

U.S. Embassy Pakistan, 2015. U.S. Embassy Pakistan [Facebook]. 10 June – 10 July 2015. Available at: < https://www.facebook.com/pakistan.usembassy?fref=ts> [Accessed 1 July 2015].

U.S. Department of State, n.d. Under Secretary for Public Diplomacy and Public Affairs. [online] Available at: <http://www.state.gov/r/> [Accessed 10 July 2015].

Wang, J., 2006. Managing national reputation and international relations in the global era: Public diplomacy revisited. Public Relations Review, [e-journal] 32 (2), pp.91-96. Available through: SOAS Library website <https://www.soas.ac.uk/library/> [Accessed 18 July 2015].

Ward, C., 2012. Pakistanis remain angry, suspicious over bin Laden raid. CBS News, [online] 24 September. Available at: <http://www.cbsnews.com/news/pakistanis-remain-angry-suspicious-over-bin-laden-raid/> [Accessed 20 July 2015].

Zhang, J., 2013. A Strategic Issue Management (SIM) Approach to Social Media Use in Public Diplomacy. American Behavioral Scientist, [e-journal] 57(9), pp.1312-1331. Available through: SOAS Library website <https://www.soas.ac.uk/library/> [Accessed 5 August 2015].

Zhong, X. and Lu, J., 2013. Public diplomacy meets social media: A study of the U.S. Embassy’s blogs and micro-blogs. Public Relations Review, [e-journal] 39(5), pp.542-548. Available through: SOAS Library website <https://www.soas.ac.uk/library/> [Accessed 5 July 2015].

‘The Diaspora Option’ – The Only Option?: Diaspora Diplomacy and State-Sponsored Transnationalism in Eritrea and Ethiopia

Tewodros Sile

Abstract A changing definition of the diaspora, which emphasises homeland orientation and assumes a continued engagement with homeland affairs, coupled with the forced migration of much of the Eritrean and Ethiopian diasporas, has led to high levels of engagement in homeland politics in both cases. This relationship has been cultivated by both states to buttress their foreign and domestic policy priorities. Acceptance of ‘The Diaspora Option’, implies an overwhelming reliance on the diaspora for economic and political support, and manifests itself practically through ‘diaspora diplomacy’ and the enactment of diaspora policies focused on harnessing and controlling their power. This is not only recognition of the power diasporas hold but is also about wresting the power and initiative from them and pulling it into the firm orbit of the Eritrean and Ethiopian states through ‘state sponsored transnationalism’. This is where Eritrea has a long history, stretching back to the pre-independence era, and where Ethiopia is attempting to strengthen its role. This dissertation will argue that as the state-diaspora relationship develops in both countries, it moves beyond engagement and mobilisation of the diaspora to co-option and control by the state.

Introduction

The academic interest in diaspora has mushroomed, just as the use of the term has widened and transitioned into both popular discourse and policymaking. This interest has particularly focused on the role diasporas play in their homelands and how the diaspora’s power can be harnessed. This literature has broadly veered in one of two directions. Firstly, a ‘positive’ representation that focuses on how the diaspora can help eradicate poverty and encourage economic growth, especially in developing countries. The focus here is on what the diaspora can do for the homeland, creating an unintended power imbalance where the homeland is beholden to what is perceived (rightly or wrongly) as a more financially, and politically, powerful diaspora (Kleist 2008: 1137).

Secondly, a ‘negative’ approach focused on diasporas as a force for extremity in politics, both in their homeland and their host country’s policies towards their homeland. This extends to casting diasporas as a force for prolonging conflict through measures such as conflict financing and influencing policy against peace-building (Lyons 2007: 535).

This dissertation focuses on the first approach and argues that states are not just passive actors in the diaspora-homeland relationship but are increasingly sophisticated in how they integrate their diaspora into all policy sectors. ‘Diaspora diplomacy’ has become an increasingly integral tool of a state’s public diplomacy strategy, alongside more traditional forms of diplomacy (Leonard 2002). In this, the state’s role is still paramount; contrary to some of the debate around transnationalism and globalisation (Bernal 2006) that relegates the state’s role as secondary to that of “diasporic and transnational communities as social formations across and beyond the borders of nation states” (Schiller et al. 1992; Appadurai 1996 cited in Hoehne et al. 2010:9). This continued importance of the state in the diaspora-homeland relationship has been aided by the increasing recognition states give to “The Diaspora Option” (Pellerin and Mullings 2013), and more crucially by international institutions acting as a key source of funding and political support for many states, especially developing ones.

As state-diaspora relationships develop, states are increasingly looking to diasporas for political mobilisation purposes and it is on this aspect that this dissertation will concentrate. This is borne out of the changing definition of diaspora, which has transformed from a wider vision of all nationals (or those of common descent) of a state abroad to a narrower “political-administrative” (Dufoix 2011: 1) category in which the diaspora is not only defined by its externality to the homeland, but also its desire and obligation to continue to donate to and campaign on behalf of their homeland. Increased state awareness and involvement of the diaspora’s power seeks to move from simply engaging and mobilising the diaspora to co-opting, and even controlling it, as part of an attempt to rebalance the relationship in the state’s favour.

Eritrea and Ethiopia, the case studies in this dissertation, are held up as archetypal examples of how “states can actively engage or co-opt diasporic and/or transnational actors” (Hoehne et al. 2010: 9), but also take “active measures against threats emanating from partly transnational and/or diasporic civil society activism” (Ibid). Both countries are located in the Horn of Africa, a “crisis-region par excellence” (Markakis 2003; Cliffe et al. 2009; Shinn 2010 cited in Hoehne et al. 2010: 3) and therefore a long-standing source of migrants and refugees (United Nations High Commissioner for Refugees (UNHCR) 2014: 14). With the interlinked nature of both political relationships and diasporas between the countries of the Horn, understanding the state-diaspora relationship is crucial not only for deciphering events in Eritrea and Ethiopia, but also in the wider region.

Secondly, Eritrea and Ethiopia have a closely intertwined history (Reid 2007) and both states diaspora policies have origins in the decades prior to the current governments’ ascent in 1991. This is rooted in the both countries’ ruling parties being ex-liberation movements with a long history of support from the diaspora (Tareke 2009). Through understanding the context and trajectories of these two states’ relationships with their diasporas, their policies will be shown to have wider implications from providing lessons for other states with ex-liberation front governments to how the power balance between states and diasporas is shifting increasingly towards the state as “state-sponsored transnationalism” (Portes et al. 1999: 220) becomes the cornerstone of many countries diaspora policies.

Theoretical Framework

Prior to detailing how and why diasporas are mobilised and engaged, it is important to answer two fundamental questions: firstly, what is a diaspora? Secondly, why should the diaspora’s links to the homeland matter?

The term ‘diaspora’ has undergone a transformation from a narrow usage focused on the historical experience of the Jews’ exile from Israel (Ibid) to encompassing a wide range of dispersed communities. The breadth of this wider usage has led some to argue that the term is “used without any precaution or definition” (Dufoix 2011: 10).

This has in turn driven academics and policymakers to attempt defining a set of criteria for groups to fulfil in order to be classified as a diaspora. William Safran’s six criteria, the “very first” (Ibid: 3) archetypal set against which subsequent criteria have been juxtaposed, are worth detailing. Safran argues that a diaspora must share “several” (Ibid) of the following characteristics: “Dispersion from an original centre to at least two foreign regions; existence of a collective memory about the original homeland; common belief in the minority status of the group; definition of the homeland as the place to return to; commitment to the maintenance or restoration of the homeland; and the continued presence of relationships to the homeland” (Safran 1991: 83-84 cited in Dufoix 2011: 3).

Although Safran’s criteria are not accepted wholesale in this dissertation, some elements such as relationships to the homeland continue to be important for current understandings of diasporas. However, others such as the idea of a collective memory of the homeland or the homeland as a place of return cannot be so uniformly applied to other cases beyond that of the Jews. Indeed, such definitions have the unwitting effect of homogenising the diaspora and casting them as “unitary actors” (Brubakers 2005: 20) when they are actually “fluid entities with evolving priorities” (Lum et al. 2013: 202) especially in Eritrea and Ethiopia’s cases where “different groups are contesting what constitutes the nation and the nation-state” (Horst 2013: 231) and the idea of a collective memory is difficult to ascertain. Safran’s detailed criteria stand in stark contrast to what Brubakers has argued is “a dispersion of the meanings of the term in semantic, conceptual and disciplinary space” (Brubakers 2005: 1) that resulted in diaspora being applied to any group where the only connecting factor seems to be “little more than sheer dispersion” (Ibid: 3). This critical stance, however, does not mean that Brubakers shies away from offering his own definition of diaspora.

Brubakers outlines three overarching criteria: dispersion, homeland orientation and boundary maintenance or “the preservation of a distinctive identity vis-a-vis a host society” (Ibid: 5-6). Whilst the first two can be superimposed on Safran's criteria, and he argues are largely accepted in the wider literature, the third is particularly important for the cause of diaspora

mobilisation as it denotes that the diaspora is conceived of, and conceives of itself, as “a distinctive ‘community’, held together by active solidarity that cut across state boundaries and link members of the diaspora in different states into a single ‘transnational community’” (Ibid: 6). It is the boundary maintenance criteria that leads to a common feature of the usage of the term diaspora, that of treating it as a “bounded group” (Ibid: 13) that acts in unison regarding engagement in their host country or in their homeland. Thus we see constant referral to ‘the’ diaspora of a certain state (Ibid: 9), seemingly discounting any heterogeneity within the diaspora and the effects of various factors, such as age and gender, on diaspora engagement in homeland politics (Anthias 1998 cited in Horst 2013: 231). This understanding of the diaspora as a unified entity, both in “public and political discourses” (Kleist 2008: 1136) leads us to the current prevailing understanding of the term and one that will be the central for this paper. Whilst Brubakers highlighted and criticised the expansion of the definition and usage of the term diaspora, the 1990s and early 2000s saw a re-narrowing of the definition. This had its roots in three interrelated developments that also help answer the second key question of why the diaspora’s links with the homeland matter. Firstly, there was increasing academic focus on the role of diasporas in their homelands, rather than in their host countries alone. Studies documented how “transnational migrants were contributing to the economic health and wellbeing of households and communities in their home countries” (Pellerin and Mullings 2013: 91) and therefore showed that assumptions that émigrés “severed” (Ibid) ties to their homeland were incorrect. Furthermore, the diaspora’s “capacity to generate global flows of economic, cultural and social capital” (Ibid) led to what Dufoix identified as “a new use of the term” (Dufoix 2011: 4) which related to “the networks that groups of highly skilled migrants build in order to take part in the development of their countries of origin, as well as to possibly supporting, maintaining, or even creating a link between expatriates and their homeland” (Ibid). It is this “political-administrative” (Ibid: 1) definition of diaspora, which puts the homeland orientation of Safran and Brubakers at its centre that has become the dominant definition of diaspora today. Secondly, homelands have increasingly begun to acknowledge the importance of their diasporas as a constituency that can act in their benefit. One example of this is the mushrooming of governmental diaspora institutions. The Economist recently noted that “in the early 1980s barely a dozen countries had a ministry, a government department or some other official institution dedicated to their diasporas” (The Economist 2015a) but as of 2014, this figure has rocketed to over 100, approximately 60% of UN member states, with the vast majority setting up such institutions after 2000 (Ibid).

State recognition is in turn related to the third trend: recognition by a range of international institutions. This results from presenting the “'diaspora' as a sign of a positive link between migration and development” (Dufoix 2011: 12) with the capacity and willingness to “contribute to the development of the homeland” (Ibid: 11). Such a characterisation is important, not only in its assumptions of the diaspora as a unified entity but also because it assumes that the diaspora is a vehicle for positive engagement and can assist international institutions meet their targets for economic development, especially in developing states. Indeed, Dufoix notes how the adoption of the term by institutions, such as the World Bank and International Organisation for Migration (IOM), made “'diaspora policies' a specific dimension of the best practices which newly independent or emerging states are now expected to implement” (Ibid). This has in turn driven states to engage with their diaspora due to the possibility of obtaining “more funding from international organisations” (Ibid: 12) by prioritising the diaspora within their lexicon. Furthermore, the widening recognition of the

importance of diasporas has gone from being the preserve of developing states alone to one which even developed states have been eager to harness (Ibid: 8-9). These three interlinked developments are neatly captured in Dufoix’s two main criteria for the “political-administrative” (Ibid: 1) vision of the diaspora that is dominant today. The first criteria divides states on whether the diaspora includes only their nationals abroad, or expands to include those of national descent with foreign nationality. More important is the second criteria that “such descriptions go hand in hand with the elaboration and implementation of policies specifically aimed at these population” (Ibid). This dimension is the most important as current discussions of diaspora often do not occur unless it is within the context of how a homeland can mobilise its diaspora. Understanding the centrality of this homeland mobilisation and engagement to this current definition of diaspora is central to understanding why what Pellerin and Mullings have termed “The Diaspora Option” (Pellerin and Mullings 2013: 89) has become a prevalent part of policymaking in homeland states.

An additional important point that underlies some of the literature, and is integral to the paradigmatic case of the Jews, is the forced nature of dispersal. Although Brubaker’s view denotes a sense of exclusivity to diaspora membership, the nature of dispersal may have a tremendous effect on later involvement with the homeland. Individuals who permanently migrate on a voluntary basis to another country may choose to limit involvement in homeland affairs because they want to focus on their new life in the host country. However, people forcibly displaced from their homeland may have limited choice about whether or not they can continue to be involved in homeland affairs. They seek to maintain kinship, economic and political links to the homeland they never wanted to leave (Sheffer 2003: 50-51). This nature of dispersal can generate a certain link to the homeland that is cultivated both by the diaspora and by the state itself. Lyons notes that when individuals have been forcibly uprooted from their homeland “through a specific set of traumatic memories” (Lyons 2007: 529) this creates what he terms “‘conflict-generated diasporas’ that sustain and often amplify their strong sense of symbolic attachment to the homeland” (Ibid). Lyons defines the term with specific reference to Ethiopia, and given the interconnectedness of Eritrean and Ethiopian history, the term can also be applied to Eritrea thus underscoring the importance of these cases to the wider state-diaspora engagement and mobilisation literature. With members of such conflict-generated diasporas continuing to possess the “emotional citizenship” (Bernal 2006: 164) of their homeland, there is not only a compelling rationale for individuals to mobilise on behalf of causes in their homeland, but also for the state in question to use this emotionally amplified connection to drive diaspora mobilisation and engagement in the homeland, and crucially, on behalf of the state.

Al-Ali et al. note that transnational activities are conducted at four key levels: economic, political, social and cultural (Al-Ali et al. 2001a: 619-624). It is on all of these levels that Eritrea and Ethiopia have, and continue, to try and affect diaspora mobilisation and engagement and strengthen their role in the diaspora-homeland relationship.

For instance, whilst migrants may send remittances, these are often directed at family members. This is “not money that the government has any access to and which it can utilise to leverage its interests” (Mwagiru 2011: 50) leading to the conundrum for states of how to mobilise the collective power of the diaspora. The economic power of the diaspora is not insubstantial, equalling “twice the sum total of the world’s official development assistance” (Kalm 2013: 388). States have recognised this power and attempted to harness it and re-balance the perception that diasporas are the more powerful party in the state-diaspora relationship. This is particularly pronounced in political contexts where the line between the state, branches of government, ruling party and the leader are often blurred. This is a criticism

that has been directly levelled at Eritrea, with the United Nations Office of the High Commissioner for Human Rights (UNOHCHR) Commission of Inquiry (COI) Report on the human rights situation in Eritrea noting that there is a blurring of “the lines between the three sources of constitutional authority by concentrating all power in the executive, and in particular in the figure of the President – who is also the head of the party, at the cost of the legislature and the judiciary” (UNOHCR 2015b: 450). This state-led engagement has been termed “state-sponsored transnationalism” (Portes et al. 1999: 220) where states actively pursue the diaspora, formulates links between the diaspora and the state and even “circumvent or co-opt their initiatives” (Ibid). In some cases, it is argued that such transnationalism can be “enforced” (Al-Ali et al. 2001b: 595) in diaspora communities through state operatives, or social pressure from other members of the diaspora, as Al-Ali et al. define with reference to Eritreans in Europe, but as Lindley notes, it is more accurate to term such engagement as “pressured transnationalism” (Lindley 2009: 1325).

Historical Background

Prior to detailing the policies that are driving state-led diaspora engagement and mobilisation, it is imperative to outline a brief history of the formation of both countries’ diasporas and state-diaspora relations.

Scholars have identified broad ‘waves’ of migration from both countries. The first is that of students that went to a variety of countries for higher education (Getahun 2002). Although Eritrean students were part of the first wave of migration, the overwhelming reason for Eritrean migration was the War for Independence from Ethiopia from 1961-1991, first under the Eritrean Liberation Front (ELF) and later under the Eritrean People’s Liberation Front (EPLF) (Iyob 1995). In the course of this war, it is estimated that up to third of Eritrea’s population left (Conrad 2006 cited in Manger and Assal 2006: 105) and this “conflict-generated diaspora” (Lyons 2007: 529) became a critical source of support for both liberation fronts. The second main wave of migration followed the Ethiopian Revolution of 1974 and the ‘Red Terror’ of 1977-78. The new military regime, known as the Dergue, faced opposition from a variety of ethnic and regional-based liberation fronts and rival Marxist parties (Loukeris 2004: 1). The ‘Red Terror’ was particularly bloody, seen as signifying the “unparalleled degree of barbarity” (Human Rights Watch (HRW) 1994: 5) of the Dergue, and it is estimated that approximately 10,000 people were killed in Addis Ababa alone in this period (Ibid: 7). The earlier and later waves, although different in character, were linked by the common factor of the upheavals associated with the Dergue and its seventeen-year rule. Eritreans in the diaspora played an important role in both the ELF and EPLF. The ELF was instituted by diaspora Eritreans in Cairo and when its organisational structure was first defined in 1962, the Revolutionary Command was composed entirely of Eritrean exiles (Iyob 1995: 109-111). The EPLF meanwhile is credited with being able to organise the diaspora in an extremely efficient manner (Clapham 2000). The EPLF also adopted a series of measures that sought to lock the Eritrean diaspora into the quest for independence. Economically, there were the financial contributions (donations and a 2% tax) that many Eritreans in the diaspora paid to help finance the EPLF and its activities (Ibid: 11). Additionally, the EPLF and its ‘mass organisations’ (Pool 2001: 83) such as the National Union of Eritrean Women (NUEW), set up chapters in Eritrean communities abroad to solicit funds and gain political support (Hepner 2008: 7). The EPLF also enacted a biennial festival, held in Bologna Italy, to enhance the EPLF’s role at all four levels of transnational activity outlined by Al-Ali et al.

This was a chance for EPLF representatives to directly address Eritreans in the diaspora, and allowed Eritrean’s to meet others in the diaspora, thus serving as a social gathering. In addition, the presence of EPLF cultural troupes served as a way of solidifying a distinct ‘Eritrean’ identity (Andall 2002: 396). The EPLF is thus an early non-state example of how cultural, economic and political means are deeply interconnected within diaspora movements.

The history of EPLF’s organisation helps us understand why many of the structures and initiatives used to garner the support of diaspora Eritreans in the days of the War of Independence have continued today. The EPLF, renamed the People’s Front for Democracy and Justice (PFDJ) in 1994 (Pool 2001: 177), is currently the ruling and only legal party in Eritrea, and has therefore inherited many of the structures and practices of the EPLF. Three examples point to the continuation of this state-driven policy in the economic, political and cultural spheres. The first is the institutionalisation of the 2% tax, known officially as the Recovery and Rehabilitation Tax in a 1995 government directive (Matsuoka and Sorenson 2001: 229). Additionally, remittances continue to be crucial to the overall Eritrean economy, accounting for almost one third of Eritrea’s Gross Domestic Product (Styan 2007: 17). Second is the entrenchment of political links through the re-establishment of EPLF mass organisation chapters and local community associations (Hepner 2008: 3). Moreover, the diaspora played a key role in the referendum on independence, the process of forming an Eritrean constitution (Al-Ali et al. 2001b: 590), and secured representation in the National Assembly (The Economist 2003). Finally, the social and cultural links nurtured by the Bologna Festival have been continued with annual Eritrean festivals now held in numerous countries across Europe, North America, the Middle East and Australia (Arnone 2014). These continue their multi-faceted function as social gatherings for Eritrean diaspora communities, a conduit for the Eritrean state to gain political and economic support, and a channel to reinforce Eritrean identity.

These state-led initiatives are an important way in which the Eritrean government has been able to continue eliciting the support of the diaspora, even if some of these measures arise from social pressure or sanctions, such as not issuing passports to those who have not paid the 2% tax. Al-Ali et al. have characterised the Eritrean case as “enforced transnationalism” in which state policy and the context of flight mean that transnational activities occur in a set fashion, reinforced by myths and memories deployed by the and by members of the diaspora around the common cause of the struggle for independence (Al-Ali et al. 2001b: 595). Organisational and transnational networks, established in a mutual process between the diaspora and the state, reinforce this shared experience and help strengthen these memories. Ethiopia’s diaspora was, and is, much more fragmented than its Eritrean counterpart. Many of the political groupings active in Ethiopian politics have differing goals, ranging from ethnically based liberation fronts to groups that argued for a particular ideological version of a united Ethiopia. This means that, apart from a desire to see the downfall of the Dergue, there was no single unifying force that could unite these groups. This factor persists, especially as many of the movements are still largely exile-based and continue to act against the current Ethiopian People’s Revolutionary Democratic Front (EPRDF) government. The state is thus unable to call on its diaspora for support in the same way as Eritrea. It is estimated that if Ethiopians in the diaspora were to remit 10% of their annual income, the net value of this would be equal to Ethiopia’s current Gross National Product (Yau and Asseffa 2007). Although this is currently not the case, this projection shows the possible influence of the diaspora and thus justifies the state’s continued focus on the diaspora as a target of its initiatives.

Despite these divisions, a commonly shared factor by all parties is their appeal for support amongst Ethiopian diaspora communities. These attempts to gain diaspora support have occurred both historically and in the contemporary period. For example, the Tigray People’s Liberation Front (TPLF) gained support not only amongst those living in Ethiopia, but also among the large Tigrayan refugee community in Sudan (Young 1998 cited in Clapham 1998: 44). TPLF’s activities were coincidentally similar to the EPLF, borne out of their close relationship and shared goal of eliminating the Dergue (Young 1996). Given that the TPLF currently forms the core of the ruling EPRDF, in power since 1991, a direct link can be traced between many of Ethiopia’s current diaspora engagement initiatives to ideas formulated in the pre-1991 era. Although the Ethiopian state has undertaken measures to court the diaspora, many of these are not ‘enforced’, as in the Eritrean case, which has meant that many in the diaspora opposed to the EPRDF have not taken them up. For example, since 2011 Ethiopia has been issuing bonds to finance construction of the Grand Ethiopian Renaissance Dam (GERD), slated for completion in 2017 (Water Technology 2015). The campaign for contributions has extended to the diaspora, with arguably only minimal success. Figures released in March 2014 showed that only 38,520 diaspora members had purchased bonds, attributed to a “lack of information and other related reasons” (Ethiopian Television 2014). By June 2015, diaspora funding for the dam had been put at 600 million Ethiopian Birr (approx. US$28.7 million) since 2011 (Ethiopian News Agency 2015d), only a fraction of the estimated US$4.7 billion total cost (Water Technology 2015). Although this may seem to show the lack of success on the part of the state’s initiatives, this has not prevented the Ethiopian Government showcasing this modest involvement as a central part of the strengthening the state-diaspora relationship.

The ‘Diaspora Option’ With the role of the state thus still proving central to the diaspora-homeland relationship, it is vital to understand the practical manifestation of ‘state-sponsored transnationalism’ and how, and why, states turn to ‘The Diaspora Option’ to fulfil both stated and unstated political goals. It is also imperative to understand how states have attempted to shift the state-diaspora power balance in favour of the state and move beyond mere mobilisation of the diaspora to co-opting and even controlling it.

This recognition of the diaspora’s importance for advocating on behalf of the homeland, and especially the state, has led states to seek multiple ways to penetrate diaspora communities. Leonard has dubbed this vehicle “diaspora diplomacy” (Leonard 2002: 55). This concept arises from the literature on public diplomacy, initially conceived as a state-led activity, consisting of state A broadcasting to the population of state B (Edelstein and Krebs 2005: 90). This developed from simple broadcasting to using cultural diplomacy, exchanges and other initiatives to engage with the population of another state to enhance the image of your state and build support for your policies (Cull 2008). This original concept of public diplomacy has two foundational premises: firstly, the central role of the state in conducting the diplomacy initiatives and secondly, the target of the initiatives is the population of another state.

The latter is particularly key as it potentially ignored the role of diasporas abroad, not only in advocating on behalf of their homelands, but also mobilising in the host state on matters of relevance to their homeland (Heindl 2013). Leonard’s identification of diaspora diplomacy appears in 2002, which was at the height of the push towards understanding the diaspora as a ‘political-administrative’ entity that had not only a desire, but also an imperative, to act on

behalf of the homeland. Diaspora diplomacy thus becomes the vehicle through which states can engage with, mobilise, and co-opt their diasporas. With responsibility for Ethiopia’s diaspora policies resting firmly with the Ministry of Foreign Affairs (MOFA) (MOFA 2013), diaspora diplomacy is the primary vehicle for engagement. Eritrea also has a dedicated diaspora institution (Niewsand 2009: 6)16, and is consistently marked as an expert practitioner of diaspora diplomacy thus ensuring the diaspora not only provides support for Eritrea as a state, but also as a “critical” supporter of the PFDJ government (Lyons 2009: 170). Bringing together state-sponsored transnationalism and diaspora diplomacy states have pushed, and in many cases been pushed by international institutions, to bring these elements together into a coordinated strategy. Here three interrelated concepts are important to understand the increasing cohesiveness of state-led diaspora engagement: diaspora strategies, diaspora policies and the ‘Diaspora Option’.

“Diaspora strategies” (Kalm 2013: 379) are defined as the state-based instruments that states use to “consciously and proactively” (Ibid) engage with their diasporas. This concept is also used interchangeably with the second concept, that of diaspora policies, which applies to the unified policy documents that bind together the various initiatives targeted at the diaspora. Although these two concepts are used interchangeably, they should be more accurately seen as a continuation of one another.

Kalm’s definition focuses on specific “instruments” (Ibid) that states may use and then goes onto list what should be understood less as instruments but individual policies, such as “promotion of dual citizenship, permission of absentee voting, tax incentives and official recognition of diasporas as contributing members of the national collective” (Ibid). If we understand these strategies as individual policies, then diaspora policies are better understood as the unified policy document that brings these strategies together. For example in the case of Ethiopia, Kuschminder notes that Ethiopia’s desire to develop a diaspora policy was specifically aimed at “providing a unified approach to diaspora engagement across the different Ministries and governmental levels” (Kuschminder 2010: 3), a process that came to fruition with the inauguration of the “Federal Democratic Republic of Ethiopia (FDRE) Diaspora Policy” in 2013 (MOFA 2013). The third, and the overarching umbrella under which both diaspora strategies and policies rest is the “Diaspora Option” (Pellerin and Mullings 2013: 89). This is less an individual idea but an entire “policy orientation” (Ibid) that emphasises the importance of the human, social and political capital of diasporas and the utilisation of these resources in their “ancestral” homelands (Ibid). There are two key commonalities that can be associated with each of these three concepts, which also link to the changing nature of how a diaspora is defined and its transition into a policy-focused, administrative and homeland orientated entity. The first is the centrality of the state in the relationships between the diaspora and their homelands. The second is the role of state and non-state actors, especially the international institutions that push the ‘Diaspora Option’ as a seeming panacea to address multiple issues, especially in developing countries.

This push towards the ‘Diaspora Option’ also comes with a seemingly pre-packaged methodology of implementation, which manifests itself in two ways. The first is the seeming trajectory of how these interrelated concepts appear within a state’s policy outlook. Firstly the state recognises the importance of its diaspora to provide support, and become an important

16 This is the “Commission for Eritreans Residing Abroad” but there is rare mention of the Commission in state-

owned media.

ally, not only for the nation, but also the state. In certain contexts, such as Eritrea and Ethiopia, the current ruling party, fully accepts the Diaspora Option as an important party of the state’s policy orientation. This then leads onto a second step of the promulgation of various diaspora strategies, better understood as individual policies. From dual citizenship laws to investment proclamations, these are taken in an individual, piecemeal manner. As states recognise the need for better coordination, in part through pushes from external actors but also from the diaspora themselves, this leads to a unified and codified diaspora policy.

This is a path well trodden by Ethiopia, which has been commended by the IOM for having a “very active approach” (Negash 2009: 4) to diaspora affairs, and the IOM and other international institutions have been active in helping Ethiopia practically implement its diaspora strategies. For example, as far back as 2002, the IOM helped the Ethiopian Government to develop a website to “encourage Ethiopians in the west to help in the development of their home country” (BBC News 2002).

In addition to the role of international institutions, a central tenet of diaspora engagement which has not been given as much attention is the role of inter-state relations and cooperation in providing guidance, and practical policies, for states on how they can engage their diaspora. For different reasons, both Eritrea and Ethiopia are active in this sphere, Eritrea as a case to ‘learn from’ and Ethiopia as an active digester of other countries’ experiences and encouraging cooperation amongst states.

Eritrea’s “longstanding transnational linkages that predate independence and span several decades” (Bernal 2006: 167) have led to what has appeared to be a constant amazement at the unity and cohesiveness of the diaspora, particularly in relation to the “extraordinary sense of communal solidarity” (Wrong 2005) shown by Eritreans in the diaspora as they contributed their dues to help fund the struggle for independence. Although authors have started to highlight the divisions in the diaspora, as the Eritrean state comes under pressure from various Eritrean political opposition and civic movements (Hepner 2008: 495; Hoehne et al. 2010: 15), the ability of the Eritrean state to muster a significant proportion of the diaspora is still a key illustration of the strength of Eritrea’s state-sponsored transnationalism. From the continued collection of the 2% tax, despite the imposition of United Nations (UN) sanctions, through to the ability to coordinate global demonstrations in support of the state’s position on matters, such as denouncing the imposition of sanctions in 2010 (Hirt 2014: 129). The state’s reach and power was recently underscored by its ability to swiftly mobilise a Europe-wide demonstration against the recent UNOHCHR COI Report at the UN in Geneva (Naib 2015b). Interestingly, this was followed four days later by a counter-demonstration in support of the COI’s findings, thereby bringing to the fore the deep divisions within the Eritrean diaspora that have become an increasing feature of accounts of the state-diaspora relationship (Naib 2015a).

Ethiopia’s diaspora strategies have borrowed almost entirely from the experience of India, largely in part due to the hiring of an Indian consultant to advise the Ethiopian Government on its diaspora engagement policies and institutional set-up (Kuschminder 2010: 6). It was on the basis of the consultant’s advice that Ethiopia set up its Expatriate Affairs Directorate General within the MOFA, rather than as a separate Ministry, as India’s experience showed it did “not work to separate emigration affairs from the Ministry of Foreign Affairs” (Kuschmidner and Siegel 2011: 11). India continues to be the key adviser for Ethiopia with a workshop in July 2015 on Ethiopia’s development of a diaspora law concluding in India being thanked for its “unreserved support for Ethiopian Diaspora policy formulation, training and sharing experience in Diaspora mobilization” (MOFA 2015).

Ethiopia has also moved from being an active ‘learner’ of other’s diaspora experiences to becoming a proponent for wider cooperation between multiple states, especially “South-South” cooperation, with states as diverse as Uganda, South Africa and Botswana (Kuschminder 2010: 5).17 This encouragement of South-South cooperation may be seen as an indicator of solidarity amongst countries with similar development challenges, and an acceptance of the link between diasporas and development as advocated by external actors. Conversely, it can also be seen as a desire by states with similar political outlooks to work together on how to extend their reach beyond the territory of the state and into the diaspora to fulfil a range of stated, and unstated, political goals.18

The State Strengthened

Apart from the policy-focused levels of setting up dedicated diaspora institutions or promulgating laws to encourage and assist the diaspora to strengthen its links with the homeland, the phraseology the state applies to its diaspora members can also help detect how the state understands its relationship with its own diaspora. This provides a clue as to the level of importance a state attaches to its diaspora, what kind of relationship it has, or intends to have with the diaspora, and the principles underlining ideas of citizenship and the role of the state. For Eritrea, the centrality of the diaspora to the country’s independence struggle (Bernal 2013a: 248) is consistently reinforced by both members of the diaspora and the Eritrean state itself who consider the diaspora as simply another component of the nation (Bernal 2013b: 301). Thus for various sections of Eritrean society, be it government officials, members of exile opposition movements, or the diaspora themselves, the phrases “Eritreans at home and abroad” (Ibid) or “Eritreans residing in…” (Assenna 2014) consistently appear in speeches, reports of community activities and in political manifestoes. This integration of the diaspora into the overall nation is also reflected in official policy regarding Eritrean citizenship, which states that “Any person born to a father or a mother of Eritrean origin in Eritrea or abroad is an Eritrean national by birth” (Refworld 1992) which is peculiar for two reasons. Firstly, it grants citizenship through both the matrilineal and patrilineal lines, which transcends the patrilineal customs of much of Eritrean society (Tekle 1998 cited in United Nations Development Fund for Women (UNIFEM) 1998: 104). Secondly, what Bernal has termed this “quasi-citizenship” (Bernal 2006: 174) status is deemed “unusual by international standards” (Ibid), a phrase that is often applied to many elements of Eritrean diaspora policy, such as the 2% diaspora tax.19 In the case of Ethiopia, the official terminology attached to the diaspora is more fragmented and lacks consistency, but a key shift can be detected. Thus, the most common official phrase is “Ethiopians and foreign nationals of Ethiopian Origin”, which is also the official definition in the country’s Diaspora Policy (MOFA 2013: 8). Although the full phrase is still commonly used in official communications, the standalone phrase ‘Ethiopian Diaspora’ has been gaining traction. This is often shortened to ‘diasporas’ (Ethiopian News Agency 2015a) for the collective, but also stretches to referring to individuals as a ‘diaspora’ (Ethiopian News 17 The inclusion of Botswana is particularly apt as it is singled out in the FDRE Diaspora Policy as a country that many skilled Ethiopians are migrating to (MOFA 2013: 6). 18 One can point to the close relationship between the Rwanda Patriotic Front (RPF) in Rwanda and the EPRDF as an example, and some of the similar diaspora engagement policies and strategies (Republic of Rwanda, Ministry of Foreign Affairs and Cooperation, Diaspora Directorate General 2015). 19 Eritrea is one of only two states, along with the United States of America, that taxes it citizens on income earned abroad (Whiteley 2013).

Agency 2015c) or self-identifying as a ‘diaspora’ to indicate membership of the group. This increasing use of diaspora in the terminology is closely aligned with the notion of the diaspora’s role being one of “meaningful contribution to the development of the country” (MOFA 2011: 5) and the role of the diaspora being explicitly referenced to in the country’s programme for “poverty reduction” (Ibid). This definition thus aligns closely with the positivist view of the diaspora, which paints a direct link between diaspora mobilisation and development, one that has been further encouraged by various international organisations that have assisted Ethiopia in deepening engagement with its diaspora. This change in the recognition of the centrality of the diaspora can also be evidenced by the change in the name of the country’s main diaspora institution to the Diaspora Engagement Affairs General Directorate, an indication of the change of approach of the Ethiopian state towards its diaspora (Ibid: 6). At first glance, the definitions in Eritrea and Ethiopia show a difference between states that regard their diaspora as ordinary citizens, as is the case with Eritrea, and others that categorise their diaspora as a seemingly separate sector of society, as appears with Ethiopia. However, with Ethiopia’s move towards speaking of “Ethiopians abroad” or “Diasporas”, this is becoming more aligned to the Eritrean position, which views the diaspora as part and parcel of the nation. With this terminology both the Eritrean and Ethiopian states are extending the boundaries of the nation and the state, reflective of a wider debate that Dufoix notes has led to new visions of the nation that explicitly include those outside of the immediate borders of the state. One Dufoix calls the “extra-territorial nation, with inclusion of nationals abroad as full citizens” (Dufoix 2011: 1) and second is “the over-state nation, with inclusion of people who are not nationals but connected through descent to the homeland” (Ibid). As useful as this dichotomy is in both countries, either one of the categorisations cannot be uniformly applied. Their inclusion of both Eritrean/Ethiopian passports holders abroad, as in an extra-territorial state, but also anyone of Eritrean/Ethiopian descent within the nation, as in an over-state nation, shows that the two visions of the nation Dufoix outlines can be neatly merged.

With this expansion in the boundaries of the state, and membership of the Eritrean or Ethiopian nation, this also leads to state-led behaviours regarding how the diaspora is integrated into policy-making, and in the methods and policies of diaspora engagement from the state. With the diaspora considered as part of the nation, the devisal and implementation of diaspora policies is no longer just a confine of the foreign policy sphere through the act of diaspora diplomacy, but one that both informs and reflects domestic policies within a state and the political outlook of the parties in power. This is particularly important as both states increasingly prioritise (and possibly even overemphasise) the ‘Diaspora Option’ to shore up political support for the state. Having gone through an independence struggle to assert its sovereignty and mould a distinct ‘Eritrean’ identity (Sherman 1980: 67), the Eritrean state has been rigorous in its determination to consolidate nationalism, both within Eritrea and in the diaspora. The unofficial national motto has become ‘One People, One Heart’ (Asfaha 2010) and in order to direct diaspora initiatives towards national goals, the state has taken an active role in managing and guiding diaspora involvement towards state-approved goals. For example, the state has “blocked all avenues of support to individual municipalities by obstructing the development of local civil society organizations” (Hirt 2014: 126) in order to break down hometown linkages that have been deemed “backward and regionalist” (Ibid) and to ensure more equitable development across Eritrea that doesn’t depend on whether that locality has members in the diaspora. Hepner described this phenomenon in terms of the state appearing to materialise “seemingly everywhere at once” (Hepner 2008: 477) through its transnationally replicated governance institutions that direct diaspora engagement and mobilisation to goals

carefully set out by the Eritrean state (Ibid). For example, the NUEW, which notes that Eritrean women in the diaspora have played a key role at the “forefront of efforts to empower women inside the country” (United Nations Development Programme (UNDP) and NUEW 2015: 9), recently outlined projects funded by NUEW branches abroad, each of which had been allocated the project by NUEW headquarters (Ibid: 11). Thus the diaspora, although the crucial source of funding for the projects, and thus seemingly the power holder in the relationship between itself and the NUEW, has its initiatives carefully directed to meet the goals of the NUEW, and by extension the Eritrean state and its “national development priorities” (Ibid). This is but one example in the plethora of state-directed initiatives that have made the Eritrean diaspora a consistently recurring case study in the wider transnationalism and diaspora engagement literature.

Following the promulgation of the FDRE constitution in 1995, Ethiopia has been officially governed on the principle of ethnic federalism (Hoehne et al. 2010: 5), which through the organisation of ethnically based regional states, has “institutionalized ethnicity as the controlling consideration in national politics” (Lyons 1996: 125). This form of governance was a radical break from the previously centralised Ethiopian state and continues to face opposition not only from within Ethiopia, but more crucially, from the diaspora (Zewde et el. 2010: 11). As such, the Ethiopian state’s initiatives towards the diaspora have shown a blend of those targeted on the basis of ethnicity, and coordinated by the regional states, but also centrally coordinated national initiatives. This can be seen as both a reflection of tension within the Ethiopian political sphere, but also recognition on the part of the Ethiopian state, and its international institutional backers, that without consolidation of diaspora engagement at a national level, the overall effectiveness of diaspora policies will be lessened. Since 2014, Ethiopia has conducted regional diaspora festivals, with Tigray first (Nagish 2014), whose diaspora has been a key source of political backing for the TPLF, and by extension the EPRDF (Tareke 2009: 107; Zewde et al. 2010)20, and Oromia in 2015 (Oromo Diaspora 2015). It also recently held the first “National Diaspora Day” (Ethiopian Diaspora Portal 2015)21 to consolidate engagement with the diaspora at a national level. For both regional diaspora festivals, the state-owned airline, Ethiopian Airlines, offered discounts of 40% for festival attendees, subject to individuals providing a certified letter of support from their nearest Ethiopian diplomatic mission (The Embassy of the FDRE to the Commonwealth of Australia 2015). In addition, the Oromia State Government organised food, transport and accommodation for attendees of the festival (Ibid), as well as tours of development activities across the region (Ethiopian News Agency 2015b). State initiatives thus show a two-pronged approach that is reflective of both the primacy of ethnic-based organisation in the domestic Ethiopian political sphere, with the addition of a national outlook similar to any other country that formally undertakes engagement with its diaspora.

Despite these seeming differences in the two countries approach to diaspora engagement and mobilisation, there is a key commonality in the central role of the state in directing initiatives and harnessing the various levers at its disposal for the state’s goals. This ability to harness various levers of the state in pursuit of the government’s goals for diaspora engagement and mobilisation is but one illustration of how the role of the state is not only key in engagement

20 The Tigray Diaspora Festival coincided with the 40th anniversary of the Union of Tigreans in North America (UTNA), a former TPLF mass organisation, which had decided to commemorate this anniversary in Ethiopia (UTNA, 2014). 21 Interestingly, previous literature has identified earlier incarnations of an “Ethiopian Diaspora Day” with the first in 2009 (Kuschminder and Siegel 2011:18) but the Ethiopian Government has been very clear about marking the 2015 edition as the first.

with the diaspora, but is increasingly becoming the key determinant of how, when, and why the diaspora engages with its homeland.

Conclusion

Although this paper has focused on the interconnected cases of Ethiopia and Eritrea, the lessons learned from the history, policies and development of each country’s diaspora policies, and particularly the state-diaspora relationship, has implications in the wider international sphere in three specific ways.

Firstly, both states’ diaspora engagement has its roots firmly in the ruling parties’ statuses as former ex-liberation fronts that have transitioned from guerrilla warfare to the seat of government and control of state power. A constantly recurring theme of the literature on these groups is the importance of diasporas in providing a key pillar of support, be it political, financial or human. Both the EPLF and TPLF, and later EPRDF, having become reliant on the diaspora for their support, have taken this level of engagement with them into government. The specifics of each case differ however. Eritrea’s engagement with its diaspora is indigenous in origin and was centrally led from the beginning, through the liberation fronts, and the carryover of these relationships into the formal state arena was relatively seamless. For Ethiopia however, the contestation over the post-1991 political direction, and the continuous presence of elements of the diaspora as the key opponents to the EPRDF, has meant that the state has taken a longer time to embed state-led diaspora engagement at a national level. This has been in turn helped by the push of influential international organisations, and transnational cooperation between states as they seek to learn from one another’s diaspora policies, leading now to Ethiopia’s position as one of the leading proponents of diaspora engagement and mobilisation in Sub-Saharan Africa (Ong’ayo 2014: 22). Understanding these cases can then be important for helping us to understand the role of the diaspora and the relationship with the state in other states with ex-liberation era governments, particularly in Sub-Saharan Africa.22

This is tied to the second area of the transition of diaspora diplomacy from non-state to formalised state arenas increasingly underscores the wider importance of diaspora diplomacy in any state’s diplomatic toolbox, and for both its foreign and domestic policy. Therefore diasporas, often considered (potentially problematically) as unitary actors, are increasingly becoming important players in the conduct of international relations, not only in relation to their host states or their homelands but also in relation to the plethora of actors that seek to influence state behaviour, from international media through to non-governmental organisations and international institutions.

Thirdly, the most important aspect is the impact that this recognition is having on the power balance within the state-diaspora relationship. With this increased importance of, and recognition attached to, diasporas, states have become increasingly adept at rebalancing the odds in their favour, particularly in contexts where the diaspora has previously been deemed as so financially and politically important that states must be ‘beholden’ to its demands. With this reality, homeland states will have to be savvier in navigating the world of diaspora politics if they are to successfully harness the diaspora’s perceived, and actual, power and rebalance the relationship.

The impact of this rebalancing in the state-diaspora relationship is one that will not only have impacts on the policies and outlooks of homelands states, but also host states. As homeland

22 See footnote 3

states actively penetrate diaspora communities abroad and attempt to co-opt them in support of the homeland state, and particularly the government of the day, host states will continue to become the focus of lobbying by diasporas, not just those that are anti-homeland governments but also those who actively support homeland governments. It will be up to host states to carefully manage its responses to these diasporas as they become left with conflicting messages about the state of affairs in homeland states and how to respond to them. One only needs to look at the close proximity and scale of demonstrations by members of the Eritrean diaspora in Europe against and in support of the recently released UNOHCHR COI Report and the calls on various European governments to reject/support this report to see the careful path host states will need to tread in their interaction and engagement with diasporas. Homeland states will not only have an important ally in terms of the state-sponsored diaspora for domestic policies, but also in influencing relationships with host states. With the twin phenomena of ever increasing levels of migration (IOM 2014) and deepening state-led diaspora engagement, state-sponsored transnationalism and the use of the ‘Diaspora Option’ will become factors that will have an increasing role in not only the state-diaspora relationship, but also state-state and state-citizen relationships in both homeland and host states.

Bibliography

Addis Fortune, Ethiopia’s foreign policy is anchored on, Vol. 15, No. 750, 14th September 2014, http://addisfortune.net/columns/ethiopias-foreign-policy-is-anchored-on/ [Accessed 17th August 2015]

Addis Fortune, Humor, the Needed Armor, Vol. 16, No. 798, 17th August 2015, http://addisfortune.net/articles/humor-the-needed-armor/ [Accessed 17th August 2015]

Al-Ali, Nadje; Black, Richard; Koser, Khalid (2001), Refugees and transnationalism: The experience of Bosnians and Eritreans in Europe, Journal of Ethnic and Migration Studies, 27:4, 615-634

Al-Ali, Nadje; Black, Richard; Koser, Khalid (2001), The limits to ‘transnationalism’: Bosnian and Eritrean refugees in Europe as emerging transnational communities, Ethnic and Racial Studies, 24:4, 578-600

Alemayehu, Biniam, The Diaspora Controversy, Vol. 14, No. 703, 20th October 2013, http://addisfortune.net/articles/the-diaspora-controversy/ [Accessed 17th August 2015]

Andall, Jacqueline (2002), Second-generation attitude? African-Italians in Milan, Journal of Ethnic and Migration Studies, 28:3, 389-407

Anthias, Flora (1998), Evaluating “Diaspora”: Beyond Ethnicity?, Sociology 32, 557–580

Appadurai, Arjun (1996), Modernity at Large: Cultural dimensions of globalization, Minneapolis: University of Minnesota Press

Arnone, Anna (2008), Journeys to Exile: The Constitution of Eritrean Identity Through Narratives and Experiences, Journal of Ethnic and Migration Studies, 34:2, 325-340

Arnone, Anna (2011), Tourism and the Eritrean Diaspora, Journal of Contemporary African Studies, 29:4, 441-454

Arnone, Anna (2014), The Eritrean Festival in the Time-Warp, Social Evolution and History, 13:2, 73–96

Asfaha, Mebrahtu, The Eritrean Spirit of Perseverance, Ministry of Information, 19th February 2010, http://www.shabait.com/categoryblog/1333-the-eritrean-spirit-of-perseverance [Accessed 22nd August 2015]

Assenna, “Eritreans residing in Bergen Norway and it’s environs celebrate independence day anniversary”, 27th May 2014, http://assenna.com/eritreans-residing-in-bergen-norway-and-its-environs-celebrate-independence-day-anniversary/ [Accessed 19th August 2015]

BBC News, Net bid to bring Ethiopians home, 2nd April 2015, http://news.bbc.co.uk/1/hi/world/africa/3593299.stm [Accessed 4th August 2015]

Bernal, Victoria (2005), Eritrea On-line: Diaspora, Cyberspace, and the Public Sphere American Ethnologist 32(4), 660-675

Bernal, Victoria (2006), Diaspora, Cyberspace and Political Imagination: the Eritrean Diaspora Online, Global Networks 6(2), 161-179

Bernal, Victoria (2013), Diaspora, Digital Media, and Death Counts: Eritreans and the Politics of Memorialisation, African Studies, 72:2, 246-264

Bernal, Victoria (2013), Please Forget Democracy and Justice: Eritrean and the Powers of Humor, American Ethnologist, 40:2, 300-309

Beyene, Hailay Gebretinsae (2015), Are African diasporas development partners, peace-makers or spoilers? The case of Ethiopia, Kenya and Nigeria, Diaspora Studies, 8:2, 145-161

Bodomo, Adams, Upshots of Remittance, Addis Fortune, Vol. 14 No. 724, 16th March 2014, http://addisfortune.net/columns/upshots-of-remittance/ [Accessed 17th August 2015]

Brubakers, Rogers (2005), The ‘diaspora’ diaspora, Ethnic and Racial Studies, 28:1, 1-19 Campbell, John R. (2009), Caught between the ideology and realities of development:

Transiting from the Horn of Africa to Europe, LSE Migration Studies Unit Working Papers No. 2009/01, 1-29

Chacko, Elizabeth and Gebre, Peter H. (2013), Leveraging the diaspora for development: lessons from Ethiopia, GeoJournal, 78:3, 495-505

Chacko, Elizabeth and Price, Marie (2009), The Role of the Diaspora in Development: The case of Ethiopian and Bolivian immigrants in the USA, 1-19

Clapham, Christopher (2000), War and state formation in Ethiopia and Eritrea, Centre de Etudes et de Recherches Internationales, Paris

Cliffe, Lionel, Love, Roy and Tronvoll, Kjetil (2009), Conflict and Peace in the Horn of Africa, Review of African Political Economy, 120, 151–163

Conrad, Bettina, (2006), We Are the Warsay of Eritrea in Diaspora’: Contested identities and social division in cyberspace and in real life In Manger, Leif and Assal, Munzoul A.M., Diasporas within and without Africa: Dynamism, Heterogeneity, Variation, Nordiska Afrikainstiutet, Uppsala

Danish Immigration Service, Eritrea – Drivers and Root Causes of Emigration, National Service and the Possibility of Return, Country of Origin Information for Use in the Asylum Determination Process Report from the Danish Immigration Service’s fact finding missions to Ethiopia and Eritrea August and October 2014, Copenhagen, November 2014, https://www.nyidanmark.dk/NR/rdonlyres/B28905F5-5C3F-409B-8A22-0DF0DACBDAEF/0/EritreareportEndeligversion.pdf [Accessed 23rd June 2015]

Dufoix, Stéphane (2011), From Nationals Abroad to ‘Diaspora’: The Rise and Progress of Extra-Territorial and Over-State Nations, Diaspora Studies, 4:1, 1-20

Ephrem, Benyam, Why has our diaspora failed to transcend?, The Reporter, 11th July 2015, http://www.thereporterethiopia.com/index.php/opinion/viewpoint/item/3730-why-has-our-diaspora-failed-to-transcend? [Accessed 18th August 2015]

Ethiopian Diaspora Portal, “Ethiopia: Heightening Ethiopian Diaspora Contribution”, 15th July 2015, http://www.ethdiaspora.org.et/index.php/item/202-ethiopia-heightening-ethiopian-diaspora-contribution [Accessed 22nd August 2015].

Ethiopian News Agency, “Diaspora Day expects to boost Diasporas involvement in Ethiopia's Dev’t”, 1st August 2015, http://www.ena.gov.et/en/index.php/politics/item/1187-diaspora-day-expects-to-boost-diasporas-involvement-in-ethiopia-s-dev-t#sthash.Zp4mFHpD.dpuf [Accessed 20th August 2015]

Ethiopian News Agency, “Diasporas visiting devt projects in Oromia”, 6th August 2015, http://www.ena.gov.et/en/index.php/economy/item/1206-diasporas-visiting-devt-projects-in-oromia [Accessed 22nd August 2015]

Ethiopian News Agency, “Ethiopians continue to arrive in Addis for the first Diaspora festival”, 8th August 2015, http://www.ena.gov.et/en/index.php/politics/item/1216-ethiopians-continue-to-arrive-in-addis-for-the-first-diaspora-festival#sthash.6n3oO75x.dpuf [Accessed 20th August 2015]

Ethiopian News Agency, “Ethiopian Diaspora Purchases 110 Million birr GERD Bond in Six Months”, 20th June 2015, http://www.ena.gov.et/en/index.php/economy/item/990-ethiopian-diaspora-purchases-110-million-birr-gerd-bond-in-six-months [Accessed 4th September 2015]

Ethiopian Television, Ye Diaspora Ashara (The Diaspora’s Fingerprints), Megabit 2006 (March 2014), http://www.diretube.com/etv-special/contribution-efforts-for-the-renaissance-dam-video_45b684856.html [Accessed 4th August 2015]

Feyissa, Dereje (2012), The transnational politics of the Ethiopian Muslim diaspora, Ethnic and Racial Studies, 35:11, 1893-1913

Fikade, Birhane, Diaspora business in Ethiopia: mismatched expectations, The Reporter, 15th August 2015, http://thereporterethiopia.com/index.php/in-depth/indepth-business-and-economy/item/3859-diaspora-business-in-ethiopia-mismatched-expectations [Accessed 18th August 2015]

Fikade, Birhane, Diaspora community outburst frustrations, The Reporter, 15th August 2015, http://www.thereporterethiopia.com/index.php/news-headlines/item/3864-diaspora-community-outburst-frustrations [Accessed 18th August 2015]

Fikade, Birhane, The Diaspora: wheeling businesses to Ethiopia, The Reporter, 15th August 2015, http://www.thereporterethiopia.com/index.php/interview/item/3855-the-diaspora-wheeling-businesses-to-ethiopia [Accessed 18th August 2015]

Getahun, Solomon A. (2002), Brain Drain and its effect on Ethiopia’s institutions of Higher Learning, 1970s-1990s, African Issues, 30:1, 52-56.

Glick Schiller, Nina; Basch, Linda and Blanc-Szanton, Christina (eds.) (1992), Towards a Transnational Perspective on Migration: race, class, ethnicity, and nationalism reconsidered, New York: New York Academy of Sciences

Heindl, Brett S. (2013), Transnational Activism in Ethnic Diasporas: Insights from Cuban Exiles, American Jews and Irish Americans, Journal of Ethnic and Migration Studies, 39:3, 463-482

Hepner, Tricia Redeker (2003), Religion, Nationalism, and Transnational Civil Society in the Eritrean Diaspora, Identities: Global Studies in Culture and Power, 10:3, 269-293

Hepner, Tricia M. Redeker (2008), Transnational governance and the centralization of state power in Eritrea and exile, Ethnic and Racial Studies, 31:3, 476-502

Hepner, Tricia Redeker (2014), Religion, Repression and Human Rights in Eritrea and the Diaspora, Journal of Religion in Africa 44: 151-188

Hepner, Tricia Redeker (2015), Generation Nationalism and Generation Asylum: Eritrean Migrants, the Global Diaspora, and the Transnational Nation-State, Diaspora 18: 2/3

Hirt, Nicole (2014) The Eritrean Diaspora and its impact on Regime Stability: Responses to UN Sanctions, African Affairs, 114:454, 115-135

Hoehne, Markus Virgil; Feyissa, Dereje; Abdile, Mahdi, Schmitz-Pranghe, Clara (2010), Differentiating the Diaspora: reflections on diasporic engagement ‘for peace’ in the Horn of Africa, Max Planck Institute for Social Anthropology Working Papers - Working Paper No. 124, 1-29

Home Office, Country Information and Guidance, Eritrea: Illegal Exit, March 2015 https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/412716/CIG_-_Eritrea_-_Illegal_Exit_-_March_2015_-_v1_0.pdf [Accessed 23rd June 2015]

Horst, Cindy (2013), The Depoliticisation of Diasporas from the Horn of Africa: From Refugees to Transnational Aid Workers, African Studies, 72:2, 228-245

Human Rights Watch, Ethiopia: Reckoning Under The Law, 1st December 1994, 5 http://www.hrw.org/reports/pdfs/e/ethiopia/ethiopia94d.pdf [Accessed 3rd September 2015]

International Organisation for Migration (IOM), Global Migration Trends: An Overview, December 2014, http://missingmigrants.iom.int/sites/default/files/documents/Global_Migration_Trends_PDF_FinalVH_with%20References.pdf [Accessed 25th August 2015]

Iyob, Ruth (1995), The Eritrean Struggle for Independence: Domination, Resistance, Nationalism 1941-1993, Cambridge University Press

Kalm, Sara (2013), Diaspora Strategies as Technologies of Citizenship, Global Society, 27:3, 379-397

Kassa, Lucy, Homecoming March, Addis Fortune, Vol. 16, No. 797, 13th August 2015, http://addisfortune.net/articles/homecoming-march/ [Accessed 17th August 2015]

Kleist, Dr Nauja (2008), In the Name of Diaspora: Between Struggles for Recognition and Political Aspirations, Journal of Ethnic and Migration Studies, 34:7, 1127-1143

Koser, Dr Khalid (2007), Refugees, Transnationalism and the State, Journal of Ethnic and Migration Studies, 33:2, 233-254

Kuschminder, Katherine (2010), Diaspora Engagement in Ethiopia: Finding its Footing. IS Academie Migration Policy Brief, Vol 4

Kuschminder, Katie and Siegel, Melissa (2011), Understanding Ethiopian diaspora engagement policy, UNU‐MERIT Working Paper Series, 2011-040

Leonard, Mark (2002), Diplomacy by Other Means, Foreign Policy, 132, 48-56 Lindley, Dr Anna (2009), The Early-Morning Phonecall: Remittances from a Refugee

Diaspora Perspective, Journal of Ethnic and Migration Studies, 35:8, 1315-1334 Loukeris, Kostas (2004), Contending Political ideologies in Ethiopia after 1991: The Role of

Intellectuals, Polis Revue Camerounaise de Science Politique, Vol. 12, Numero Special 2004-2005,

Lum, Brandon; Nikolko, Milana; Samy, Yiagadeesen; Carment, David (2013), Diasporas, Remittances and State Fragility: Assessing the Linkages, Ethnopolitics: Formerly Global Review of Ethnopolitics, 12:2, 201-219

Lyons, Terrence (1996), Closing the Transition: The May 1995 Elections in Ethiopia, The Journal of Modern African Studies, 34:1, 121-142

Lyons, Terrence (2007), Conflict-generated diasporas and transnational politics in Ethiopia, Conflict, Security and Development, 7:4, 529-549

Lyons, Terrence (2009), The Ethiopia–Eritrea Conflict and the Search for Peace in the Horn of Africa, Review of African Political Economy, 36:120, 167-180

Markakis, John (2003), The Horn of Conflict, Review of African Political Economy, 97, 359–362

Matsuoka, Atsuko and Sorenson John (2001), Ghosts and Shadows: Construction of Identity and Community in an African Diaspora, University of Toronto Press

Mekonnen, Yoseph, Poor Infrastructure Overshadows Remittance Boom, Addis Fortune, Vol 14 No.697, 8th September 2013, http://addisfortune.net/articles/poor-infrastructure-overshadows-remittance-boom/ [Accessed 17th August 2015]

Merhatsidk, Mikias, Remittances Sharing the Wealth, Addis Fortune, Vol. 14 No. 729, 20th April 2014, http://addisfortune.net/articles/remittances-sharing-the-wealth/ [Accessed 17th August 2015]

Migration Policy Institute, “The Ethiopian Diaspora in the United States”, Rockefeller Institute-Aspen Diaspora Program Profile, July 2014

Ministry of Foreign Affairs of Ethiopia, Basic Information for Ethiopians in the Diaspora, Diaspora Engagement Affairs General Directorate, September 2011,

http://www.mfa.gov.et/docs/Basic%20Information%20For%20Diaspora.pdf [Accessed 18th July 2015]

Ministry of Foreign Affairs of Ethiopia, Federal Democratic Republic of Ethiopia – Diaspora Policy, 2013, http://www.ethdiaspora.org.et/index.php/policy-documents [Accessed 18th July 2015]

Ministry of Foreign Affairs of Ethiopia, MFA conducts workshop on Diaspora Law, 31st July 2015 http://www.mfa.gov.et/news/more.php?newsid=4452 [Accessed 26th August 2015]

Mwagiru, Makumi (2011), Diplomacy of the Diaspora: Harnessing Diasporas in Kenya's Foreign Policy, Diaspora Studies, 4:1, 39-58

Nagish, Yemane, Ethiopians in the diaspora to convene in Mekelle, The Reporter, 19th July 2014, http://www.thereporterethiopia.com/index.php/news-headlines/item/2267-ethiopians-in-the-diaspora-to-convene-in-mekelle [Accessed 22nd August 2015]

Naib, Fatma, Diaspora Eritreans rally against human rights abuses, Al Jazeera, 26th June 2015, http://www.aljazeera.com/news/2015/06/diaspora-eritreans-rally-human-rights-abuses-150626011455681.html [Accessed 4th July 2015]

Naib, Fatma, Eritreans divided over UN torture report, Al Jazeera, 26th June 2015, http://www.aljazeera.com/news/2015/06/eritrea-torture-report-150625174657510.html [Accessed 4th July 2015]

Negash, Minga (2009), Ethiopian Diaspora Investment Potential and EEPCO's Millennium Bond, http://dx.doi.org/10.2139/ssrn.1370515 [Accessed 27th July 2015]

Newland, Kathleen and Patrick, Erin (2004), Beyond Remittances: The Role of Diaspora in Poverty Reduction in their Countries of Origin, Migration Policy Institute, 45

Newland, Kathleen and Tanaka, Hiroyuki (2010), Mobilizing Diaspora Entrepreneurship for Development, Migration Policy Institute, 1-29

Niewsand, Boris (2009), Development and Diaspora: Ghana and its Migrants, Max Planck Institute for the Study of Religious and Ethnic Diversity, 1-30,

http://www.mmg.mpg.de/fileadmin/user_upload/powerpoint/Development_and_Diaspora/Nieswand_Development-and-Diaspora.pdf [Accessed 24th August 2015]

Ong’ayo, Antony Otieno (2014) Diaspora Engagement in a Constricted Political Space: The Case of Ethiopian Diaspora Organisations in the Netherlands, European Centre for Development Policy Management, Discussion Paper No.168

“Oromia Diaspora”, http://www.orodiaspora.org/NEWS.html [Accessed 22nd August 2015] Pellerin, Hélène and Mullings, Beverley (2013), The ‘Diaspora option’, migration and the

changing political economy of development, Review of International Political Economy, 20:1, 89-120

Pool, David (2001), From Guerrillas to Government: The Eritrean People’s Liberation Front, James Currey Ltd

Plaut, Martin, Divided and dispersed, Eritrea opposition struggles to harness spirit of resistance, The Guardian, http://www.theguardian.com/politics/2015/aug/19/inside-eritrea-political-opposition-threat-isaias-afwerki [Accessed 20th August 2015]

Portes, Alejandro; Guarnizo, Luis E.; Landolt, Patricia (1999), The study of transnationalism: pitfalls and promise of an emergent research field', Ethnic and Racial Studies, 22:2, 217-237

Refworld, Eritrean Nationality Proclamation (No. 21/1992) [], 6 April 1992, available at: http://www.refworld.org/docid/3ae6b4e026.html [Accessed 19 August 2015]

Reid, Dr Richard (2007), The Trans-Mereb Experience: Perceptions of the Historical Relationship between Eritrea and Ethiopia, Journal of Eastern African Studies, 1:2, 238-255

Republic of Rwanda, Ministry of Foreign Affairs and Cooperation, Diaspora Directorate General, http://www.rwandandiaspora.gov.rw/ [Accessed 25th August 2015]

Safran, William (1991), Diasporas in modern societies: Myths of homeland and return, Diaspora, 1:1, 83 – 99

Schmitze-Pranghe, Clara (2010), Modes and Potential of Diaspora Engagement in Eritrea, Diaspeace Working Paper No.3

Shearlaw, Maeve, From online trolling to death threats – the war to defend Eritrea's reputation, The Guardian, http://www.theguardian.com/world/2015/aug/18/eritrea-death-threats-tolls-united-nations-social-media [Accessed 18th August 2015]

Shearlaw, Maeve, Outside Eritrea looking in: a diaspora that stands divided, The Guardian, http://www.theguardian.com/world/2015/aug/20/eritrea-diaspora-divided-your-stories [Accessed 20th August 2015]

Sherman, Richard (1980), Eritrea: The Unfinished Revolution, Praeger, New York

Sheffer, Gabriel, Diaspora Politics: At Home Abroad, Cambridge University Press, Cambridge, 2003

Shinn, David (2010), Challenges to Peace and Stability in the Horn of Africa, Paper presented at Elliott School of International Affairs

Styan, David (2007), The evolution, uses and abuses of remittances in the Eritrean economy, The Royal Institute of International Affairs

Tadesse, Genet, Commercial Bank Targets Diaspora with Foreign Market Expansion, Vol. 15, No. 740, 6th July 2014, http://addisfortune.net/articles/commercial-bank-targets-diaspora-with-foreign-market-expansion/ [Accessed 17th August 2015]

Tareke, Gebru, The Ethiopian Revolution: war in the Horn of Africa, Yale University Press, New Haven and London, 2009

Tecle Samia and Goldring, Luin (2013), From ‘remittance’ to ‘tax’: the shifting meanings and strategies of capture of the Eritrean transnational party-state, African and Black Diaspora: An International Journal, 6:2, 189-207

Tegaye, Abdi, Ministry Set to Launch Exclusive Diaspora Housing Scheme, Addis Fortune, Vol. 15, No. 743, 27th July 2014, http://addisfortune.net/articles/ministry-set-to-launch-exclusive-diaspora-housing-scheme/ [Accessed 17th August 2015]

Tekle, T. (1998), Women’s Access to Land and Property Rights in Eritrea in United Nations Development Fund for Women (UNIFEM), Women’s Land and Property Rights in Situations of Conflict and Reconstruction: A READER Based on the February, 1998 Inter-Regional Consultation in Kigali, Rwanda, 104 http://www.refworld.org/pdfid/46cadad90.pdf [Accessed 24th August 2015]

Temam, Tofick, Constraints of the diaspora, beyond celebrating the Ethiopian diaspora day, The Reporter, 8th August 2015, http://www.thereporterethiopia.com/index.php/opinion/viewpoint/item/3828-constraints-of-the-diaspora-beyond-celebrating-the-ethiopian-diaspora-day [Accessed 18th August 2015]

The Economist, Diasporas: A world of exiles, 2nd January 2003 http://www.economist.com/node/1511765 [Accessed 18th June 2015]

The Economist, Gone but not forgotten, 25th June 2015 http://www.economist.com/news/international/21656176-governments-believe-their-diasporas-can-solve-all-sorts-problems-they-are-picky [Accessed 30th June 2015]

The Economist, What Countries want from their diasporas, 25th June 2015, http://www.economist.com/blogs/economist-explains/2015/06/economist-explains-20 [Accessed 30th June 2015]

The Embassy of the Federal Democratic Republic of Ethiopia to the Commonwealth of Australia “Notice about Oromia Diaspora Festival and National Ethiopian Diaspora Day”, 19th June 2015, http://www.ethiopianembassy.net/embassy-news/notice-about-oromia-diaspora-festival-and-national-ethiopian-diaspora-day/ [Accessed 22nd August 2015]

The Ethiopian Herald (Editorial), Diaspora engagement in nation building second to none, 14th August 2015 http://www.ethpress.gov.et/herald/index.php/editorial-view-point/item/1771-diaspora-engagement-in-nation-building-second-to-none

Yau, Joshua and Asseffa, Henok (2007), The Potential of Greater Ethiopia: A Nation Beyond Borders, The Rise of a Globally Interconnected Ethiopian Entity and the Promise it Holds for Development, Precise Consult International, Accessed from the World Bank: http://info.worldbank.org/etools/docs/library/241086/XXXThe%20Potential%20of%20Greater%20Ethiopia.pdf [Accessed 4th September 2015]

Young, John (1998), The Tigray People’s Liberation Front in Clapham, Christopher (ed.),

Union of Tigreans in North America (UTNA), Background of Tigray festival 2014 in Tigray, http://utna.org/index.php/tigray-festival-2014/background [Accessed 24th August 2015]

United Nations Development Programme (UNDP) and National Union of Eritrean Women (NUEW), “Women in Eritrea: 10 Years Report”, 3rd February 2015,

http://www.er.undp.org/content/eritrea/en/home/library/womens_empowerment/undp-nuew-publication0.html [Accessed 8th June 2015]

United Nations High Commissioner for Refugees (UNHCR), UNHCR Global Trends Forced Displacement in 2014, http://www.unhcr.org/556725e69.html [Accessed 17th August 2015]

United Nations Office of the High Commissioner for Human Rights (UNOHCHR), Report of the commission of inquiry on human rights in Eritrea -- A/HRC/29/42, June 2015

United Nations Office of the High Commissioner for Human Rights (UNOHCHR), Report of the detailed findings of the commission of inquiry on human rights in Eritrea -- A/HRC/29/CRP.1, June 2015

Water Technology, Grand Ethiopian Renaissance Dam Project, Benishangul-Gumuz, Ethiopia, http://www.water-technology.net/projects/grand-ethiopian-renaissance-dam-africa/ [Accessed 4th September 2015]

Whiteley, Don, “Will Canada’s hard line on Eritrea’s ‘diaspora’ tax apply to the U.S.?, The Globe and Mail, 29th May 2013, http://www.theglobeandmail.com/globe-debate/will-canadas-hard-line-on-eritreas-diaspora-tax-apply-to-the-us/article12224084/ [Accessed 24th August 2015])

Wrong, Michela, World view - Michela Wrong overhears diaspora gossip, New Statesman, 14th February 2005, http://www.newstatesman.com/node/149945 [Accessed 26th August 2015]

African Guerrillas, James Currey Ltd Young, John (1996), The Tigray and Eritrean Peoples Liberation Fronts: A History of

Tensions and Pragmatism, The Journal of Modern African Studies, 34:1, 105-120 Yorke, Gosnell L. (2012), Africa and its Diaspora: The principal reciprocal benefits to be

derived from the amended Constitutive Act of the African Union, International Journal of African Renaissance Studies - Multi-, Inter- and Transdisciplinarity, 7:2, 79-95

Zewde, Bahru; Yntiso, Gebre; Berhanu, Kassahun (2010), Contribution of the Ethiopian diaspora to peace-building: a case study of the Tigrai Development Association, University of Jyväskylä, Diaspeace Project, 2010, (Diaspeace working paper. ISSN 1798-1689; No. 8)