The Taliban are cutting the umbilical cord of dependence, leaving Islamabad and Beijing in the lurch. A historical turning point that most experts didn’t even have time to notice: Afghanistan is officially closing its only previous trade route through Pakistan and completely reorienting its export and import towards Iran and India.
Now the port of Chabahar is becoming Afghanistan’s main foreign trade “window” to the world.

AFGHANISTAN – INDIA CORRIDOR

Pakistan no longer controls the Afghan economy, China is losing a strategic link in the CPEC corridor, Iran is gaining a new source of income, and India is gaining enormous influence in Central Asia.

The Afghan Minister of Trade unveiled a five-point plan:

1. Maximizing trade with India.
2. Fully utilizing the Chabahar port.
3. Creating “dry ports” on the border with Iran.
4. Launching cargo flights between Kabul and India.
5. Increasing Indian investments in all key sectors of Afghanistan.

In other words, Afghanistan is not simply “turning away” from Pakistan – it is leaving Islamabad’s strategic orbit and entering a new alliance: Iran + India + Afghanistan.

For 20 years, Pakistan cultivated the Taliban as an instrument of influence. But the instrument suddenly became an independent actor – and Islamabad was furious. The Taliban drew the only logical conclusion: dependence on Pakistan is a death sentence, especially in light of threats of expelling refugees and economic blackmail.

Что получает Иран?

Money. Influence. And more money.

Chabahar is a competitor to Pakistan’s Gwadar, which Beijing has been transforming into its “pearl” of the Indian Ocean. Now Chabahar is becoming the main hub for 40-million-strong Afghanistan.

Iran gains transit revenues, growth in transport infrastructure, a strengthened role in the region, and transformation into a major trade hub for Central Asia.

Что теряет Пакистан?

Literally everything:

• Billions in transit revenues.
• Smuggling schemes that enriched local clans.
• Political influence in Kabul.
• Positions in the Chinese CPEC project.

Let’s recall a symbolic example: in 2002, Pakistan “legally” imported 8 million telephones into Afghanistan, which mysteriously remained in Pakistan – without duties or taxes. This was a huge source of corruption.

Afghanistan is officially withdrawing from the China-Pakistan Economic Corridor (CPEC), into which Beijing has already invested $37 billion. The remaining section is turning into a dead end with no access to Central Asia.

PROMISING TRANSPORT ROUTES IN THE INDIAN SUBCONTINENT.

In other words, geopolitically, China is losing one of its main alternative routes to the Indian Ocean.

The Taliban have done what neither the previous Afghan governments nor even the mujahideen dared to do: in one fell swoop, they have freed themselves from 70 years of dependence on Pakistan.

Afghanistan is choosing Iran and India – and thereby creating a new triangle of influence capable of redrawing the trade routes of all of Eurasia.

The post AFGHANISTAN IS JOINING THE IRAN-INDIA TRADE CORRIDOR first appeared on Global Policy.

1. Panama has two major seaports – Balboa and Colon (also the world’s second largest free trade zone), Tocumen International Airport and the Panama Canal. 10,000 ships pass through the canal every year. Important communication cables are laid along it.

2. About 6% of the world’s maritime trade passes through the Panama Canal, which saves the maritime transport sector 8,000 nautical miles and 22 days of travel between the Pacific and Atlantic Oceans. For over a hundred years, it has remained a vital economic and strategic hub. A ship can pass through the giant canal, 81.5 km long and 33-150 m wide, in just 8-10 hours. Panama earns about $3.5 billion a year in transit fees.

3. On November 17, 2017, China and Panama signed a Memorandum of Understanding on the Joint Construction of the Silk Road Economic Belt and the 21st Century Maritime Silk Road (China’s “One Belt, One Road” project).

4. In 2018, China and Panama signed a free trade agreement. China has become Panama’s largest trading partner, the largest supplier to the Colon Free Trade Zone, and the second-largest user of the Panama Canal.

5. By the end of 2021, China’s direct investment in Panama was $1 billion.

6. China-Panama trade volume in 2021 was $11.344 billion, China’s exports were $10.180 billion, and imports were $1.164 billion.

7. China’s plans and proposals to Panama were grandiose.

China’s Major Infrastructure Projects in Panama in 2016–2021

8. 01.30.2025 US Secretary of State Marco Rubio conveyed to Panamanian President José Raúl Mulino the position of Trump: China’s presence in the canal area violates the agreement on the transfer of the Panama Canal to Panama in 1999.

9. 02.02.2025 The President of Panama stated that “the country’s government will not extend the memorandum of understanding with China on the One Belt, One Road initiative.”

10. 02.08.2025 The Chinese side expressed deep regret.

Conclusions

1. China’s expansionist project “One Belt, One Road” was publicly announced in 2013. One of the main directions of its development was Panama. But only one project was implemented. Judging by the table, after 2019, China curtailed its expansion in Panama (it did not propose new projects).

2. Panama was viewed by China as a “showcase” of its “One Belt, One Road” project for Latin American countries.

3. As can be seen from the table, there was serious resistance in Panama to the implementation of Chinese proposals and projects that had been launched. This is also indicated by the insignificant volume of direct investment from China. Most likely, from the United States.

4. China’s expansionist project “One Belt, One Road” has failed in all regions of the world. It began to wind down around 2021. Three main reasons for its collapse:

— implementation of private projects in insolvent countries (Pakistan, Ethiopia, Kyrgyzstan, …);

— resistance to private projects from other countries;

— China has no “gunboats”.

5. To wean China off the Panama Canal, it was enough to convey the “Trump position” to Panama. That is, the US wiggling its little finger.

6. The US will continue to strengthen its control over maritime trade routes. This is part of their preparation for a head-on collision with China. This is, first of all, its open weaning off the world market.

The post GEOPOLITICAL ASPECTS COLLAPSE OF CHINA’S EXPANSION IN PANAMA first appeared on Global Policy.

Currently, 63 central banks are members of the BIS, including the Bank of Russia (since 1996)

Over the past few years, digital finance and digital currencies have become the most priority area of the BIS’s activities. Since the beginning of this decade, dozens of central banks, as if on command, have begun to deal with the topic of CBDC – “digital currencies of central banks.” Observers believe that the team was from Basel, from the BMR. It seems that each country is discussing or even developing its own unique versions of CBDC. But at the same time they have a lot in common. These digital currencies are served as a third type of money along with traditional cash and non-cash money. All central banks initially stated that CBDCs were intended for “internal use”, i.e. within the national borders of the respective states. A year ago, the BIS reported that about 130 central banks of the world were interested in the CBDC topic.

BASEL 3: THE REVOLUTION THAT NO ONE NOTICED

At the beginning of this summer, about four dozen central banks were already engaged in practical CBDC developments or were testing them as part of pilot projects. The largest CBDC pilot project, which was launched three years ago (in June 2021), is the digital yuan project implemented by the People’s Bank of China. Some have already legalized CBDC nationwide. There are about a dozen such countries and jurisdictions. Among them are the Bahamas, Jamaica, and Nigeria. But these are all very small countries. Except for Nigeria. But there, as I have already written, the digital currency turned out to be very poorly in demand, and when it was introduced, very serious abuses were allowed by the Nigerian Central Bank.

It is noteworthy that today many central banks developing or testing their digital currencies talk about the need to give this currency an additional function – as a means of cross-border payments and settlements. And the BIS strongly supports this approach. And not just verbally supports, but practically helps.

Three years ago, the international mBridge Ledger project was launched on the initiative of the BIS

Its participants are: the innovation division of the BIS in Hong Kong, the Hong Kong Monetary Authority, the People’s Bank of China, the Bank of Thailand, the Central Bank of the United Arab Emirates. In June of this year, the Central Bank of Saudi Arabia joined the project. As the name of the project itself implies, its goal is to create technologies that would serve as a “bridge” or “adapter”. Such a “bridge” would allow for cross-border transactions between project participants using national CBDCs.

In November 2021, the Jura project was launched on the initiative of the BIS

A consortium was created under him, whose members included the Bank for International Settlements, the Bank of France, the National Bank of Switzerland and various private firms, studied the possibility of direct transfer of wholesale CBDCs in euros and Swiss francs between French and Swiss commercial banks on a single blockchain platform (“distributed registry”).

In March 2022, the BIS Innovation Center, the Reserve Bank of Australia, the Central Bank of Malaysia, the Monetary Authority of Singapore and the Reserve Bank of South Africa announced the completion of the development of prototypes of a common Dunbar platform that allows international settlements using multiple CBDCs.

In March 2023, the Bank for International Settlements, in cooperation with the central banks of Israel, Norway and Sweden, completed the Icebreaker project, which explored the technical feasibility of using retail CBDCs in international payments.

In October 2023, the BIS, in partnership with the central banks of France, Singapore and Switzerland, confirmed the successful completion of the Mariana project, which studied cross-border trade and settlements of wholesale CBDCs between financial institutions on the blockchain platform.

Probably the most advanced and large-scale of these projects is mBridge Ledger

In addition to the six full-fledged mBridge participants, 27 other official organizations, including the International Monetary Fund (IMF), the World Bank and central banks of countries including Norway, South Korea and Turkey, joined the project as observers, which gives them access to the sandbox for experiments with adapter technology. Major global banks, including Goldman Sachs, HSBC and six of China’s largest state-owned banks, are also observers of the project.

The pilot phase of the project ended in September 2022, and the commercial launch took place a year later, in September 2023. On January 29, the UAE Central Bank carried out its first cross-border transfer of digital dirhams within the framework of the mBridge project. CBDC cross-border transfer in the amount of 50 million dirhams ($13.6 million) It was shipped to China using the mBridge multi-CBDC platform. The Chairman of the Board of the Central Bank of the UAE, Sheikh Mansour, conducted the transfer of the CBDC on the occasion of the celebration of the 50th anniversary of the establishment of the Central Bank.

RULERS OF MONEY FROM BASEL

I have already written quite a lot about CBDC, in particular in the recent book “Digital Currencies: from Bitcoin to CBDC. The “masters of money” want to become the “masters of the world”” (Moscow: Tion, 2023). In it, I say that the Central Bank’s digital currency has a very indirect relationship to money. CBDC projects are a smokescreen covering the construction of a digital concentration camp, first on the scale of a single country, and then the whole world. The BIS does not reveal all the cards. But there should be a single digital currency in the limit. However, it would be a stretch to call it a currency. It will not really perform any of the usual economic functions of money (a measure of value, a medium of exchange, a means of payment and a means of accumulation). It will be a tool for human control and management.

Another digital initiative of the BIS is the proposal of its head, Agustin Carstens, to develop a single (unified) registry technology that can be implemented on a global scale. Thus, the “financial system of the future” will be created. He gave it the name “Finternet”. Unified registries “combine all the components necessary for financial transactions – financial assets, ownership records, rules governing their use, and other relevant information – in one place,” explains Agustin Carstens. This makes it possible, with the help of unified registries, to overcome problems related to technical standards and management, as well as eliminate third-party messaging systems.

Unified registries will require tokenization of assets, especially money, for transfers using smart contracts. Tokenization of assets is not just about fixing them online. Tokenization will have to fix the compliance of assets with certain regulatory requirements (including those developed by the BIS, for example, capital adequacy standards for credit institutions developed by the so-called “Basel Committee”).

The Bank for International Settlements announced the launch of a project called Agora. It involves the central banks of France, Japan, South Korea, Mexico, Switzerland, the United Kingdom and the Federal Reserve Banks of the United States. The aim of the project is to prepare for the tokenization of assets of both central banks and private financial institutions. There is also a Promise project with the participation of the BIS, the Swiss National Bank and the World Bank to create a platform for the tokenization of bills of exchange.

The BIS states that it does not plan to create a comprehensive unified registry – it is about ensuring convenient interaction of several unified registries through specialized applications and services. But at the same time, the BIS emphasizes that this should be done under the auspices of a common approach to conducting transactions. Consequently, several regional registries can be consolidated into a single global registry at any time. A single digital brave new world will arise, which can be called a global digital concentration camp without a stretch.

However, in addition to the BIS, other international organizations are involved in building a global digital concentration camp. Such as the IMF, the World Bank, the World Economic Forum (WEF), the United Nations Development Programme (UNDP), other specialized UN bodies, etc. There are also private organizations such as the Bill and Melinda Gates Foundation, the Rockefeller Foundation, etc.

This year, a project called DPI is gaining momentum

This English–language abbreviation stands for Digital Public Infrastructure – digital public infrastructure. It was launched at the end of last year and is being implemented under the auspices of the UNDP with the participation of the IMF, the WEF and other international organizations and major American charitable foundations.

The post THE BANK FOR INTERNATIONAL SETTLEMENTS IS BUILDING A UNIFIED DIGITAL FINANCIAL WORLD first appeared on Global Policy.

So, on September 2, 1945 Japan capitulated. The country was ruled by the us military, the economy was in a state of ruin. “Industrial output decreased to 20% of the pre-war level.

The economy revived slowly: the pre-war level of production was restored not in 1949, as in Western Europe, but only by 1953”. In this situation, Japan needed to move to a new development strategy, and the essence of this strategy was a fundamental departure from the past. It was necessary to create a new structure of the economy, new incentives to work, democratization of society, development of market relations and entrepreneurship. Thus, it was decided to invite American entrepreneurs and managers who have developed a program relating to all aspects of Japanese life.

The Japanese economic miracle arose in 50-60 years of the 20th century

This phenomenon seems incredible, because having suffered a severe defeat in the war, Japan suffered significant damage, both morally and materially, and despite this was able to break into economic leaders.

The main problem in Japan at that time was the lack of its own raw materials limited opportunities for extensive growth and predetermined the need for an intensive development path. Japan had to import 99% of the necessary natural resources (100% bauxite and Nickel, cotton, natural rubber, more than 90% oil, iron ore, non-ferrous metals). Limited natural resources forced Japan not only to constantly modernize production, develop and introduce material and energy-saving technologies, but also to develop the export orientation of the economy. The export of national products was to provide financial resources for the import of raw materials, energy and food resources. Export orientation in a highly competitive environment required the Japanese industry to produce products to the highest international standards, to ensure its competitiveness in such parameters as price, quality, service, etc.

A number of factors contributed to the rapid recovery of Japan’s economy:

1. Total control over export-import processes was taken, the import of foreign finished products capable of silencing Japanese industry was prohibited, but the import of modern Western production technologies was encouraged, which ultimately aimed at the development of the technological industry of Japan.

2. At the state level, producers of new products were supported, and dealers were in a less enviable position, the pressure in their direction made this type of activity not profitable. As a result, the number of primary producers grew and thus national wealth increased faster.

3. Effective use of the achievements of STD. Japan skillfully applied the achievements of world scientific thought, acquiring patents, licenses, know-how and implementing them in practice. This made it possible to save money and make a huge leap in science and technology on the basis of the scientific and technical level already achieved by other countries

4. The active economic role of the state, which was a major owner and buyer, was of great importance for the economic recovery of Japan. The state also had an impact on economic development through planning, but plans were developed by representatives of financial groups and corporations. Two types of plans were developed – national, the implementation of which was provided by private investment, and sectoral, implemented by the financial means of the state.

However, first of all, this merit is directly to the Japanese workers who performed the most difficult tasks, so the “Japanese economic miracle” is primarily based on the system of labor relations.

You can distinguish the main features of such a system:

THE MAFIA ESSENCE OF THE GLOBAL WESTERN ECONOMY

– the system of lifelong employment, which is based not on the formal legal “consolidation” of the person, but on the real ensuring the interest of employees to work maximum time in this enterprise and to link their fate with it for life. The increase in the length of service affects the level of wages and future pensions, the duration of leave, to obtain some additional privileges;

– socio-psychological factors that are of great importance in modern conditions to improve production efficiency. The administration of the company takes measures to create a good psychological climate and team building. An understanding of the company and its employees as a single family is formed, all members of which help and support each other;

– the wage system. The amount of wages of employees of firms consists of many elements. On the formation of total income of the employee is influenced by age, seniority, education, position and responsibilities, working conditions, the results, benefits for the family maintenance, housing, transport. A feature of production in Japan is the relatively low share of wages in the value of the final product compared to other countries. Thus, the share of wages in the finished product in the US is 32%, in the UK – 27%, in Japan – 11%. This is due to the fact that in Japan the growth of labor productivity is much faster than the growth of wages, and the growth rate of labor productivity is higher than in many other countries.

– the system of personnel rotation, involving the movement of workers horizontally and vertically every 2-3 years. The main purpose of the rotation is to determine the place that most contributes to the realization of the potential abilities of the employee and, ultimately, the effectiveness of the company as a whole;

– the system of training in the workplace is associated with a clear division of functions between secondary and higher education, providing basic knowledge, and in-house training, providing professional training;

– reputation system, which involves the preparation of annual characteristics for each employee at the place of work of his colleagues. Such characteristics help employees to objectively assess themselves both in the labor process and in the relationship in the team.

By 80-90-m. Japan has managed to gain a foothold in second place in the world, second only to the United States.

Thus, in just one generation, the country’s economy grew more than such economic giants (at that time) as the United States, France, Canada, Germany and Italy. Hence the concept of the Japanese economic miracle, which characterizes the dizzying rise of the country with ordinary territorial and human resources. However, in the 90-ies, this phenomenon was replaced by a disease known as the Lost decade, which occurred after the collapse of the financial sector of the country.

The post THE JAPANESE ECONOMIC MIRACLE first appeared on Global Policy.

Thus, the authorities want to maintain the pace of economic growth, which in the third quarter slowed to a ten-year low. Reducing the tax burden will support consumers, and this will move the economy forward. In addition, it will allow the Chinese economy to better resist American sanctions and protect it from external shocks.

The new plan involves an extensive program of tax deductions for different needs. On average, you can get from 1 thousand yuan (144 dollars) to 2 thousand yuan per month. The new rules should come into force on January 1, 2019. There are five main benefits:

1. Education tax deduction

Taxpayers can claim RMB 12,000 per year as compensation for the cost of each child’s education and 3 600 — 4 800 RMB compensates for the cost of their own education.

2. Tax deduction for support of elderly parents

The amount of deduction to support parents over the age of 60 will be 24,000 yuan per year. The money will be equally divided between brothers and sisters.

3. Rent reimbursement

The deduction for rental housing will be 800 yuan for residents of small towns, 1,000 yuan for medium — sized cities and 1,200 yuan for large cities.

4. Compensation of expenses on the mortgage

Interest deductions on mortgage loans will amount to 12,000 yuan per year and will affect couples buying a home for the first time.

5. Medical tax deductions

Taxpayers can qualify for a 60,000 yuan a year, if their costs exceeds 15 000 yuan after the coverage of national health insurance.

How much would that help?

Nomura analysts suggest that GDP may lose 1% in the short term due to the new tax rules. However, this will increase the growth rate of consumer demand by more than 0.2% and the annual GDP growth rate by 0.1%.

Lower taxes in China is not the first time

The authorities are carrying out a large-scale tax reform, reducing the burden on citizens and on business. For example, tax reform was announced in the summer. The threshold of annual income from which a citizen had to pay the minimum income tax of 3% increased. If earlier it was 6.3 thousand dollars, now-9 thousand dollars. Thus, if an employee will receive less than 9 thousand dollars a year, he does not have to pay income tax, which should support the poorest citizens.

That’s not all: since may 1, 2018, China has lowered VAT rates. It was reduced from 17% to 16% in the manufacturing sector and from 11% to 10% in the construction, transport, agriculture and telecommunications sectors. In addition, the list of micro-enterprises whose work was not subject to VAT was significantly expanded. If before the tax was not levied on companies whose annual sales did not exceed 500 thousand yuan (80 thousand dollars), then from may 1, the bar was raised to the level of sales of 5 million yuan.

All this is necessary to stimulate local business to increase production, to win in competition with foreign companies, and to give the population the opportunity to buy more goods and services, because this is the basis of economic growth and development of any country.

The post TAXES IN CHINA FOR CITIZENS WILL MAKE EVEN LOWER first appeared on Global Policy.