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“Geopolitics” Assignment 2

  1. How strong are we? (Top 5, 10, 25, 100? Are we a local power? A continental power? A global power?)
  2. What are our strengths? (Mention especially our strategic resources: food, water, energy and human resources)
  3. What are our weaknesses?
  4. How strong can we be? (What must change to be stronger? E.g. to a geopolitical realist Canada might need more population, where India might need less)
  5. Which states can help us with our weaknesses? (Therefore which sea routes are important to us?)
  6. Which states are our most substantial threats? Which is the most dangerous to us? List and rank three. Remember to consider the geographical distances and geographical obstacles: for example a large ocean or mountain range will in practical terms reduce the threat of a state to your state compared to having a land border on a plain. Remember that
  7. Which states can be our most reliable friends? List and rank three. (Primarily based on similar enemies, or based on those states needing us for something)
  8. You will be required to provide a Realist Top Five –point Geopolitical Strategy; Number One being the most important. Justify your order of points and explain each of them(500-1500 words)

**Remember to think as a geopolitical realist–this is the point of the exercise.  Do not include Liberal concerns about the type of government or export growth or W.S.T. concerns about inequality.  This is the world of unforgiving “self-help”, and “my state first”.

Answer:

Country Chosen – Panama

a. How strong are we? (Top 5, 10, 25, 100? Are we a local power? A continental power? A global power?)

Panama was placed 57th in the global ranking on the Human Development Index in 2020. In 2019, Panama was recognized as Latin America’s 7th most prosperous market on the World Economic Forum’s Global Competitiveness Index. It also placed 66th in 2019’s Global Competitiveness Ranking. Economic freedom score is 66.2, making the index’s economy 62nd strongest. Its overall score dropped by 1.0 point as financial health deteriorated. Panama ranks 10th among 32 countries in north America and is barely above the world average.

b . What are our strengths? (Mention especially our strategic resources: food, water, energy and human resources)

The biggest strength of Panama is attributed to its connectivity in term of transport infrastructure; ports, railways, roadways, airports etc. Its financial stability is yet its biggest strength. Panama is known to be a fully dollarized economy and has the world second largest import and export zone. The tourist industry holds immense potential. Amongst the list of countries that are under the risk of facing water scarcity issues, Panama is ranked 136 which is way less than other developing nations including India which is ranked 13th. This is attributed mainly to the geographical location of the nation. According to the estimates, the food production index of Panama has increased from 57.8 in 1969 to 103.6 in 2018.

c. What are our weaknesses?

Panama is not a crude oil, fossil fuels, or coal producer. The country is food insecure and must buy food for fulfilling people domestic food requirements. Despite a plethora of natural resources spanning from copper to wood and shrimp, Panama’s US currency economy is mostly service-based, with the Panama Canal and the Colon Free Trade Zone being the primary sources of revenue. The US State Department has designated Panama as a Country/Jurisdiction of Primary Concern for Money Laundering and Financial Crimes and is viewed as a country of gross contradictions in context of inequalities and poverty. Moreover, the country financial sector lacked transparency leading to numerous scandals and thus impacting the overall business environment. In 2018, Panama acquired a ranking of 45 in terms of global gender education gap index showcasing discrepancies in terms of education between the two gender groups. 

d. How strong can we be? (What must change to be stronger? E.g. to a geopolitical realist Canada might need more population, where India might need less)

To be the most powerful nation in the world, Panama must reduce poverty and work on its existing rule of law, juridical independence and structure, workforce, corruption and skills and knowledge of its workforce to attract businesses into the market. Also it should work towards removing all the unnecessary complications like transparency in taxes, illicit trade and money laundering. Moreover, Panama can exploit its shipping capacity to make significant improvements in the global supply chain abilities.

e. Which states can help us with our weaknesses? (Therefore which sea routes are important to us?)

Panama is not a crude oil, fossil fuels, or coal producer. Thus, it exports majority of the cure oil and other natural resources from US. Consequently, Panama Canal significantly helped stimulate the nation’s trade. Ships transiting from the Atlantic ocean to The Pacific or conversely save approximately 8,000 nautical miles (15,000 km), while ships trying to travel in between east and west coasts of the Americas save an approximately 1,5 million nautical miles (6,500 km) and ships transiting between Europe and Australasia and South-East Asia save approximately 2,000 nautical miles (3,700 km). The Panama Canal transformed worldwide trade by allowing transit between the Atlantic and Pacific Oceans significantly faster and easier.  The Panama Canal has a tremendous commitment and a huge economic and social duty to the nation in so far as it has to stay at the top of marine development in terms of sustained development and to ensure that its activities adhere to the greatest environmental regulations.

f. Which states are our most substantial threats? Which is the most dangerous to us? List and rank three. Remember to consider the geographical distances and geographical obstacles: for example a large ocean or mountain range will in practical terms reduce the threat of a state to your state compared to having a land border on a plain. Remember that

A deterioration in economic relationship between the United States and China, or between the United States and other key trading partners, could drastically erode governmental revenues generated by Panama Canal transport costs. The trade war will restrict US economy while also increasing global trade uncertainty, both of which will have a negative impact on Panama’s growth and fiscal revenue prospects. Notably, while the United States continues to be the most frequent user of the Panama Canal, China has slid to third place (behind Japan) as a factor of the trade war between the U.S and China. Panama’s relations with Taiwan will be strained in the future. 

g. Which states can be our most reliable friends? List and rank three. (Primarily based on similar enemies, or based on those states needing us for something)

1. Korean and Panama trade relationship can be beneficial for the nation.  The free trade agreement between Korea, Colombia and Panama (KORUS) will derive positive outcomes for Panama.

2. China and Panama relationship will help the nation in reviving its loosing economic wealth.

3. Relationship with EU will help the nation in strengthening its trade position.

h. You will be required to provide a Realist Top Five –point Geopolitical Strategy; Number One being the most important. Justify your order of points and explain each of them(500-1500 words)

**Remember to think as a geopolitical realist–this is the point of the exercise.  Do not include Liberal concerns about the type of government or export growth or W.S.T. concerns about inequality.  This is the world of unforgiving “self-help”, and “my state first”.

1. The nation should promote development of Nicaraguan Canal Development Investment Co Limited (HKND) to boost trade happening between Atlantic and pacific oceans. Control of this geographic feature would also provide safe passage for Chinese commerce, but also for civil power projection. If Nicaragua’s alternative were considered by Beijing, assisted by certain geopolitical factors, it would reflect Beijing’s intention to exercise overt or covert regional influence due to a strategic business mistrust of the Panama Canal’s accessibility and governance.

2. Even Mexico envisages reactivating the historic canal via the Tehuantepec isthmus. Because of their physical qualities, some of these solutions would require a transshipment point in Mariel’s Caribbean or Cuban port, West Havana.

3. The nation can capitalize on the geopolitical effect of the technological innovation leading nation and its allies with US to become a global super-power and improve its logistical capacity and shift global energy supplies. Moreover, Panama can focus on strengthening the emerging cyber facilities including cloud computing, IOT, Big Data, AI etc

4. Panama is very vulnerable to global change impacts. Panama has a multitude of extreme weather phenomena including heavy and extended rains, windstorms, storms, droughts, earthquakes, earthquakes, floods, cyclones. Widespread inequalities will have potential toxic repercussions on the environment. Thus, Panama should work on minimizing the threats induced by poverty and other inequalities.

5. The nation should strengthen its relation with U.S to ensure that Panama remains a secure place and continues to prosper as the U.S principal partner agent. 

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