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ESADEgeo Daily Digest, 23/01/2019

ESADEgeo Daily Digest, 23/01/2019

Artificial Intelligence, Brain, Think, Control

Foreign Policy – Yuval Noah Harari / Who will win the race for AI?

  • All countries, regardless of whether they are tech superpowers or not, will feel the effects of the AI revolution. Most of the world’s data is mined by the US, China, and companies based there. If this trend continues, the world could soon witness a new kind of colonialism—data colonialism.
  • Until now, the development of AI has focused on systems that enable corporations and governments to monitor individuals. Yet the world needs the opposite, too: ways for individuals to monitor corporations and governments. By focusing on the latter, latecomers to the AI race could carve out a niche for themselves and also become a check on the data superpowers.
  • Alternatively, countries that can’t compete with the AI front-runners can at least try to regulate the race. They can lead initiatives to build tough legal regimes around the most dangerous emerging technologies, such as autonomous weapon systems or enhanced superhumans. And much as countries create laws to protect their own natural resources, they can start to do the same for their data.

South China Morning Post – Jane Cai & Sidney Leng / Xi Jinping has issued a rallying cry, but what is China on alert for?

  • On Monday, at the opening session of a Communist Party meeting in Beijing, President Xi Jinping urged hundreds of provincial leaders to stay alert for any “black swan”, or unforeseen, events and to take steps to prevent “grey rhinos”, the predictable but ignored threats.
  • A current account deficit, mounting debt, growing hostility from abroad and a decelerating economy – which could hurt China’s political stability – could be among the “black swans” and “grey rhinos”.
  • “By talking about grey rhino risks, the top leadership wants to make it clear that these problems are mainly caused by external factors,” said Chen Daoyin, a Shanghai-based political scientist. China and the US are more than halfway through a 90-day trade war truce, but tariffs remain in place on billions of dollars of goods on both sides.
  • Alicia Garcia Herrero, chief Asia-Pacific economist for Natixis, said the great rhino would no doubt be real estate. “The reality is that it is a bloated sector. [It is] bigger than in any other country in the world as a percentage of GDP. But also more leveraged than any other sector in China,” Herrero said.
  • Financial Times – Tom Mitchell, Yuan Yang & James Politi / US turns down China offer of preparatory trade talks
  • Carnegie Europe – Judy Dempsey / Judy asks: Is Europe tough enough on China?

Foreign Policy – Christine Lagarde / Is the world prepared for the next financial crisis?

  • Ten years on from the Lehman Brothers collapse, one question about the financial system keeps coming up: Are we safer than we were in 2008? The short answer is yes—but not safe enough.
  • Globally, nonfinancial debt ballooned to a record $182 trillion in 2017—224 percent of global GDP, an increase of almost 60 percent over 2007. In emerging markets, public debt is at levels last seen during the 1980s debt crisis.
  • In the last year, we have already seen some investors pull money out of emerging markets in response to a stronger dollar, rising US interest rates, and trade tensions. IMF calculations show that with an abrupt tightening, there is a chance—albeit a small one—that capital outflows match those that occurred during the financial crisis.
  • How should policymakers respond to current challenges? First, they must complete financial regulatory reforms and, just as important, resist pressure to roll them back. Second, they should rebuild their fiscal and monetary arsenals. And third, they should confront more profound, longer-term risks to financial—and social—stability, such as climate change and inequality. Many of the measures that might make the world safer than it was before the last crisis depend on international cooperation.

Euractiv – Frédéric Simon / Regulators reject key section of planned France-Spain gas pipeline

  • The energy regulators of Spain and France have rejected an investment request to build the central section of the planned Midi-Catalonia (MidCat) gas pipeline linking the two countries, in a move that could spell the end of the entire project.
  • The project “fails to comply with market needs and lacks sufficient maturity to be considered,” according to a joint statement by Spain’s CNMC and France’s CRE.
  • The two regulators claimed that the project also fails to provide “a clear and positive cost-benefit ratio” with regard to market developments and “the future role of gas in the region, following the clean energy package recently agreed in Europe.”
  • The change of heart came from the Spanish side. The previous conservative government led by Mariano Rajoy was a fervent supporter of the project. But that changed in June last year, when the socialists came to power and Teresa Ribera took control of the ecology ministry.
  • MidCat had enjoyed the support of the EU’s Climate Commissioner Miguel Arias Cañete. But the European Commission now also seems to have changed its mind.

The selected pieces do not necessarily reflect the views of Javier Solana and ESADEgeo. The summaries above may include word-for-word excerpts from their respective pieces. 

 

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