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Sanctions do work — but not all countries are affected equally. A new analysis by the Kiel Institute quantifies the economic costs of sanctions and reveals the vulnerability of individual states: developing countries and economies with a one-sided export structure, as well as EU countries with a strong financial sector, are particularly susceptible to economic coercion. At the same time, the study shows how more effective action can be taken against aggressors such as Russia.

Trade in services is being largely neglected in the discussion on trade relations between the EU and the US, criticizes a recent Kiel Policy Brief. Yet trade in services is on a similar scale to trade in goods. Each year between 2014 and 2024, the US recorded a generally significant surplus in trade in services with the EU, which partially compensates for the US deficit in trade in goods.

Today, an international team of lawyers, economists, and political scientists launched a report that sheds new light on the secured lending practices of Chinese creditors in low- and middle-income countries and highlights the urgent need for more transparency in collateralized lending and borrowing. The report shows how these creditors secure priority access to cash flows and liquid assets that can be used to repay risky loans to emerging markets and developing economies (EMDEs). In a typical transaction, debtors promise to route their principal commodity export revenues through overseas bank accounts that remain out of public sight and largely beyond their control until the debts are repaid. The cash balances in these accounts, mostly located in China and controlled by the lenders, can be very large; in low-income, commodity-exporting countries, they average more than 20% of annual public debt service to all external creditors.