With relatively painless set up and easy-to-use interfaces, peer-to-peer payment networks become increasingly popular. After all, services like Zelle, Venmo and its parent company PayPal all enable the instant transfer of funds from one account to another. Money that once took days to move from one account to another now disburses in a matter of minutes. 

However, like many bi-products of the digital age, government regulation has not kept up with the high speed expansion of online payment networks. As a result, digital payment platforms create massive vulnerabilities in global financial systems. In some instances, P2P payment networks enable terrorism financing. In the United States in particular, consumers sacrifice financial security in favor of instantaneous economic transactions. In order to fully understand the destabilizing power of peer-to-peer payment networks, it’s important to first understand its relationship to classic money laundering techniques. 

The idea behind money laundering is relatively simple. Criminals and kleptocrats alike must find ways to disguise ill-begotten funds in order to use them openly on the market without arousing suspicion about their origin. Traditional money laundering schemes like the Black Market Peso Exchange allowed drug cartels in Columbia to launder over $5 billion worth of profits from drug sales in the United States every year. In order to convert drug profits from U.S. dollars to pesos the cartel concocted an intricate scheme involving drug money couriers, money launderers, electronics exporters and importers as well as money brokers. All of these actors worked together to enable drug cartel members to openly spend drug profits without any ramifications.

The scheme starts with on-the-ground cartel agents in cities like Miami that have millions of dollars’ worth of profits from illegal drug sales lying around. The agents then purchase millions of dollars’ worth of consumer electronics like laptops and computers under the guides that the products would be exported for sale abroad. The agent would pay for the products in U.S. dollars and then transport the exports to Columbia. The cartel converts their illicit U.S. dollars into pesos via offloading electronic products. The Columbian electronics importers pay the cartel for the products in pesos and in doing so avoid excessive currency conversion fees. The cartel manages to cleanse its profits of a criminal past and can now freely spend pesos on the free market. Electronic importers are just one example of industries used to launder U.S. dollars into Columbian pesos. The cartel also dealt with cigarettes, liquor, and dishwasher importers. 

The Black Market Peso Exchange represents just one of many run-of-the-mill money laundering schemes. Money laundering remains necessary for the continuation of criminal activity everywhere and so methods constantly evolve to stay ahead of law enforcement. Unlike money laundering of the old world order, today’s digital economy allows criminals to move money legally via thousands of small cash transfers rather than huge lump sums. Peer-to-peer payment providers enable widespread money laundering due to their relatively lax account creation requirements and lightning fast payment transfers. 

Although companies like PayPal explicitly forbid the use of its services for illegal financial transactions, in reality, the company has few means of enforcing such rules. This enforcement failure allows terrorist groups to move money in and out of countries in order to finance attacks. Consider the case of Mohamed Elshinawy, an American citizen who in 2015 was convicted of assisting ISIS coordinate a terrorist attack in the United States. Although the FBI arrested Elshinawy before the attack came to fruition, his ability to procure funding from ISIS via eBay and its payment partner PayPal speaks to the vulnerabilities of online payment methods. 

According to the FBI report, Elshinawy pretended to sell computer printers on eBay and, in return, received funds from ISIS for “operational purposes” via PayPal. Law enforcement intercepted Elshinawy before he could execute an attack, however, his experience points to glaring flaws in the digital financial system primarily the ways in which it promotes anonymity and reduces accountability. Elshinawy’s experience using PayPal is not a unique and similar terrorism financing schemes have been uncovered in places like Indonesia in 2017. 

Despite acknowledging the growing threat posed by digital asset exchange platforms in the documents like the“National Strategy for Combating Terrorist and Other-Illicit Financing” the government has done little to stop the expansion of digital payment platforms. Social norms broaden P2P range and visibility as consumers increasingly turn to apps like Venmo and PayPal for every day transactions. It then becomes more difficult for law enforcement and financial regulators to identify and uncover illegal activities. 

In short, if terrorism financing is the needle in a haystack, P2P platforms quadruple the size of the haystack. Even more alarming is the fact that there are no signs of digital payment trends slowing down. In 2020 alone the use of Venmo has increased by 52% compared to the same time last year. The coronavirus pandemic will only increase consumer dependency on digital payments as individuals and businesses seek contactless payment methods. 

Despite negative environmental implications, many Southeast Asian countries have built their entire economies on the textile industry, catering mostly to fast fashion. Valued at $2.4 trillion and employing over 75 million people, Southeast Asia’s textile industry must adapt in order to weather the pandemic and reduce its impact on climate change. Implementing innovative and sustainable methods of production is critical to the future of Southeast Asian economies and the planet.  

To evade the costs of fair wages and high taxes, companies relocate production to countries such as Bangladesh and Vietnam, where environmental and labor regulations are more relaxed. Companies that constantly seek cheap labor and lax regulations have disastrous consequences for the environment, but have also laid the economic foundations for developing countries in Southeast Asia. Textiles make up 80% of Bangladesh’s total exports. Textile production hubs in Taiwan have also developed into higher value sectors, as these countries open up to foreign trade and adopt new technologies. The industry in Indonesia employs as many as 4 million workers. 

While fast fashion has industrialized many Southeast Asian countries, it has also promoted exploitation of a vulnerable workforce and the degradation of the environment. The 2013 collapse of the Rana Plaza factory in Bangladesh and the pollution of freshwater sources are only two out of a myriad reasons for why the industry must change. The Rana Plaza factory was constructed using substandard materials and disregard for building codes, which eventually killed over 1,000 garment workers. The bleaching and dyeing processes in textile production contaminate water with toxic chemicals, endangering aquatic life and poisoning sources of drinking water. 

Fast fashion’s model of production revolves around the notion of “stack-them-high, sell-them-cheap,” pumping out more garments as trends quickly die out. Clothing companies like Zara take only two weeks to transform sketches into garments. The disposable nature of fashion allows approximately 350,000 tons of clothing to crowd landfills in the UK alone, costing the economy over $1 billion. Research by environmental scientists has revealed that one garbage truck worth of clothing is incinerated or sent to landfills every second. The growing global middle class and GDP per capita has doubled fast fashion consumption within the last 15 years. Yet, garments are only worn for half as long. 

In addition to consumer waste, the textile industry’s manufacturing bases are remarkably destructive. The United Nations Framework Convention on Climate Change estimates that the industry is responsible for 10% of global greenhouse gas emissions, which they expect to increase to 25% in 2050. The production of one cotton shirt requires 2,700 litres of water, exceeding an individual’s water consumption over a two year span. The pesticides used to treat cotton fields pose a serious health threat to farmers, degrade soil quality and contaminate water. 150 million trees were demolished in 2018 to farm cellulose- and protein-based fibers used in textile production. Viscose fiber, in particular, is the major source of Indonesia’s deforestation. Fast fashion giants like H&M rely on this cheap and durable fiber, with its sourcing contributing to severe untreated water waste and excess levels of toxic carbon disulfide. The combination of polluted air and water and deforestation is lethal as the climate rapidly warms. 

Storefront closures and dwindling consumer confidence have plummeted fast fashion sales. In the wake of COVID-19, H&M reported a 46% sales decline in March. Bangladesh’s textile industry estimates a $10 billion loss in 2020 as Western retailers continue to cancel mass orders. Overall, ongoing textile manufacturing and a steep drop in consumer demand has led to extraordinary levels of textile waste. Experts worry that, as the economy gradually emerges from the pandemic, excess consumption will ensue, with consumers likely prioritizing affordability over sustainability. Attracting investments back into the Southeast Asian manufacturing bases will likely suspend crucial labor and environmental regulations. 

Pursuing sustainability requires raising consumer awareness and reshaping models of production. Although many name-and-shame campaigns have exposed brands like Nike for exploitative child labor, most consumers tend to neglect this issue due to lack of proximity. Heightened consumer awareness can pressure fast fashion brands to adopt sustainable practices. The slow fashion movement, coined by Kate Fletcher of the Centre for Sustainable Fashion, sets an excellent standard for modern consumerism by focusing on the craftsmanship of clothes, opting for more sustainably made garments. 

Shifting the mindsets of consumers is a challenge, but brands marketing new and sustainable practices can attract more demand. Perhaps the latest ‘trend’ can be sustainably made clothing. Normalizing second-hand clothing is necessary to reduce garment waste, as well as dispelling the misconception that purchasing second-hand is unhygienic or tacky. Brands like Rent the Runway have capitalized on the concept of leasing clothing instead of buying and trashing. 

The recent rampage of natural disasters in 2020 has hopefully enlightened consumers to the dangers of large coroporation’s greenhouse gas emissions. Unfortunately, costliness hinders measures to limit greenhouse gas emissions. To combat this, governments can offer brands certain tax incentives that push brands to provide fairer wages and adopt sustainable methods. Governments can also penalize companies who exceed carbon emission limits. The Asia Pacific Rayon (APR) factory in Indonesia is a great example of sustainably sourcing viscose fibers. Recognizing that viscous sourcing contributes to deforestation, APR has committed to sourcing this wood fiber from sustainably-run plantations. 

Moreover, technological innovation in the textile industry can reduce the quantity of garments produced. Computer processes can now calculate the demand of items, significantly shrinking overproduction. Companies must also adopt the circular economy’s four pillared business model: phasing out toxic chemicals and microfibre release, increasing clothing usage, revamping recycling, and effectively using resources and renewable input. Once companies implement these practices, they should market their sustainability commitments, drawing consumers to more ethical labels.  

Millions of lives depend on the fashion fashion industry’s economic base, yet billions of lives depend on the earth’s survival. Legislation coupled with consumer responsibility will transform the textile industry for the better. If the textile industry wishes to stay in business, the next big trend ought to be sustainably-made clothing. 

As personal and face-to-face services have declined in favor of digital user engagement, online purchases have grown exponentially — contributing to the growth of one company in particular: Amazon, a tech giant that has already altered the way countries engage with global markets.

Amazon’s model perfectly aligns with the conditions set by the pandemic. As an e-commerce corporation, Amazon has managed to dominate industries ranging from electronics and books to movies and video games — and recently, groceries. Today, Amazon boasts a 38% share of the e-commerce market but only retains a 5% share of total retail. However, with the pandemic and a growing number of consumers who are reluctant to commute to stores, it is predicted that company revenue in 2023 will be at $88 billion — double what it is now in 2020. 

As a primarily data-driven company that has relied heavily on a digital shopping base and the extensive transportation of its products, Amazon’s success has only been accelerated by a pandemic that has forced millions of individuals to rely on e-commerce as an expedient and trustworthy method of purchasing products. 

Additionally, if we take a magnifying glass to Amazon’s business model, we can further understand how this company thrives amid the pandemic. The company is built as a conglomerate of separate independent units. Each unit makes its own decisions and has enough latitude to operate without the need for a rigid central base. Although Jeff Bezos, Amazon’s CEO, makes executive decisions, the company’s decentralized structure allows units to conduct their own operations and achieve success independently.

To the outsider, it may seem that this company would face difficulty functioning at such a transnational level. However, Bezos provided the business units with three key principles to operate under: long-term management, intense innovation and a specified focus on customer satisfaction. Amazon uses these principles to ensure its employees integrate customer approval as the number one priority — a key standout from other e-commerce competitors. Additionally, Amazon’s lower costs help drive user traffic, which attracts more independent sellers and further contributes to the company’s growing revenue. As more revenue is generated with output increasing on a growing scale of production, costs decrease over time. This leads to a downward push on the prices of products and services, which attracts more customers and propels Amazon’s optimization of business and customer satisfaction.  

However, the company must continuously innovate in order to further attract customers. Technological innovations, such as the Alexa artificial intelligence assistant and the Kindle, as well as lower membership subscription costs, have driven Amazon to the top of the e-commerce market. Even when these innovations don’t succeed, they serve as valuable lessons that often benefit the company in the long term. For example, the failed Amazon Fire Phone Product ultimately paved the way for Amazon Echo, one of Amazon’s most successful and popular products. 

Additionally, an area of Amazon’s success to note is the company’s global expansion strategy. Amazon has just built a new office in Hyderabad, India, a region that is cleverly nicknamed Asia’s Silicon Valley. This office will serve as the base of operations in India, a country with the world’s fastest-growing pool of internet users. Aiming to take advantage of the rich software technology mecca in Hyderabad, Amazon has entered this gigantic market on the front line of this developing country’s flourishing technology sector. However, there have been several setbacks created by Indian officials and local politicians, including an antitrust lawsuit charged by Indian trade regulators. Nevertheless, after four years of planning and negotiation, Amazon’s new office has finally come to life.

Despite concerns of India’s attachment to foreign investment, Prime Minister Narendra Modi has worked to increase the attractiveness of India as a lucrative place for business, allowing Bezos to invest $1 billion in small and medium-sized businesses. In fact, many Indian businesses are collaborating with major e-commerce companies such as Amazon and Flipkart, which is India’s largest online retailer. With the devastating effects of the ongoing pandemic, e-commerce has become the only option for many small and medium-sized businesses.

However, in a comparative approach to the e-commerce boom, the European Union, and countries like Sweden, may not be able to successfully adopt this model of lowering costs and prices. Though Amazon plans to launch its Swedish website within a year, Sweden’s strict worker protection laws present a significant challenge for the tech giant. Sweden possesses an attractive market for internet retailers such as Amazon, as it lacks heavy competition in the e-commerce sector. And, like India, Sweden’s local businesses must adapt to incorporate internet retailing because of the ongoing pandemic. Thus, the current socially-distanced climate could serve to facilitate the rise of e-commerce in Sweden and further cement Amazon’s entrance into the Swedish marketplace. 

But, as a country, Sweden has a strategic focus on sustainability and has strong labor unions, which both pose a challenge because of Amazon’s rap for its controversial anti-union work environment and culture. Therefore, if Amazon decides to fully commit, it has to successfully negotiate a compromise that conforms with Sweden’s workplace regulations and political culture.

Amazon’s global strategy does not flourish everywhere. Amazon has suffered from the curse of quality control as European consumer rights groups have criticized the tech giant for selling illegal items and not providing enough information about sellers. Additionally, Amazon is already in trouble with EU officials as the company faces antitrust charges for abusing its growing control over domestic markets to drive out smaller companies or rivals. Even though Amazon, along with other tech giants like Google and Apple, promises to work with the EU’s lawmakers, their lobbying efforts have fallen short. European officials are currently drafting new regulations that would prevent preferential treatment for Amazon products over European ones in an attempt to stem the anti-competitive agenda of these tech and e-commerce corporations.

While Amazon has faced incredible growth and expanded into several new countries, its global engagement model is not a path to victory void of opposition. The e-commerce giant will have to transform the very essence of its anti-union work culture and learn how to control its own growth before it completely overshadows domestic industries resulting in strict governmental regulations. The future of Amazon rests in the hands of the company’s ability to amend its business practices, as well as governments’ tech reform and antitrust policies.

Amazon continues to utilize its innovation and expansion agenda as its main tool to maintain relevancy and acquire power. Meanwhile, other companies struggling in the face of COVID-19 must develop their own unique strategies to prevent their services from being rendered obsolete by this new reality. While it is obvious that tech companies have benefitted from the pandemic, it is not clear whether this economic growth will continue after the pandemic ends. In particular, the fate of video chat and messaging companies might not fare well when human interaction resumes, especially in the education and business sectors. Only time will tell once the situation improves, restrictions end, and the global community gradually reverts back to their pre-pandemic lifestyles.