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A new world order, or will globalization survive the coronavirus pandemic?

At UN Headquarters in New York, many staff have left the building in order to work at home. UN Photo/Loey Felipe

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With the number of cases of coronavirus spreading in multiple countries around the globe, the outbreak has already been labeled a pandemic by the World Health Organization (WHO). Global economic relations have been hit hard by the virus, and demands for making the West less dependent on supplies from third countries are getting louder.

What impact could the COVID-19 pandemic have on the globalization process?

The current model of globalization took shape at the turn of the 21st century. A decade ago, the journal Russia in Global Affairs wrote that the whole concept is based on the notion that “the old market economy states will be able to simultaneously move their own production to China and maintain the economic balance of the Western system through financial transactions.” The crisis of 2008-2009 proved this approach to smoothing out “imbalances in world economic development” as being completely wrong. 

In March 2014, Time magazine noted that “over the past two years, global trade growth has been lower than global GDP growth. It’s the first time that has happened since World War II, and it marks a turning point in the global economy, with sweeping implications for countries, companies and consumers.” Shrinking possibilities for productive placement of savings coming from peripheral countries “to the Anglo-Saxon center of the global financial system” have since intensified.

The situation has forced all of the world’s leading countries to double down and work out a set of measures guarding against a possible collapse of the modern world order. The policy of sanctions and financial and economic pressure that Washington has pursued the past few years appears to be provoking some governments to look for ways to create a financial and economic system or systems that would not be dependent on the United States. New political alliances are being forged in Eurasia, Asia, and Africa, including in the form of region-wide financial institutions.

Many in the US itself, the originator of the international system existing today, were getting increasingly unhappy with what was going on. The tweets and concrete isolationist measures taken by President Donald Trump during the past three years throw in question the feasibility of almost the entire “West-centric” development paradigm. As a result, by the time the first reports about COVID-19 started coming in, the dynamics of the financial and economic processes going on in the world were largely explained by America’s trade war with China, which has been going on for several years now, taking on ever new trade and economic areas and threatening to spread to the realm of finance.

On the outside, the coronavirus epidemic, which, like a sword of Damocles, is hanging over the current architecture of world economic relations, is a testament to Trump’s and his supporters’ foresight. Indeed, in his new National Security Strategy unveiled in 2017, Donald Trump said that the world had turned into a stage of global competition. Now that literally each day brings us new evidence of how much the West and the rest of the world  really depend on supplies from China, few in America and Europe have any doubts about the need to rethink the foreign policy of the previous decades.  Above all, the idea that cooperation with rival countries, their involvement in international institutions and world trade processes to the degree of interdependence, is making them “conscientious” members of the international community and constructive partners.

By the close of 2019, Washington’s policy of “breaking down the foundations” had significantly undermined the countries’ WTO-inspired confidence in a system of rules designed to prevent trade wars. Moreover, while previously the White House referred to “national security interests” as justification for the use of restrictive measures, any country can now use the  global epidemic as a convenient pretext for resolving trade disputes outside the framework of leading international organizations, primarily the World Trade Organization. Just as The Economist put it, “Much of what has contributed to globalization at its current stage no longer matters.”

The COVID-19 epidemic thus provides a convenient opportunity to legitimize the philosophy of a world order based on “egotism and protectionism.” Faced with the prospect of mass-scale deaths caused by the epidemic, (although so far unconfirmed!), one can discard the official condemnation of unilateralism and recognize it as “the norm, a natural part of the global picture,” thus selling this new official policy to the people as “a focus on national interests.” According to critics, this is the bottom line of America’s “revisionist geo-economic project,” promoted by the current administration, which … “reflects the long-term goals of the US ruling elite even post-Trump.”

This narrative has received a further boost since, according to British media reports, not only the United States, but also a significant part of the world is critically dependent on the import of either antibiotics or communications equipment from China. Moreover, Western analysts believe that from a technological and logistical standpoint, getting rid of this overdependence would be easy because China’s dominance in many sectors of industrial and consumer goods began only 10-15 years ago. This means that the COVID-19 outbreak only threw this whole situation into harsh relief. Since the “forces of nature” are hard to predict, few people will call out the current restrictions on cross-border movement of people and goods within the framework of existing international legal procedures world trade is governed by.

But what about the political and ideological notions, according to which private companies are not told where to produce their goods when it comes to minimizing costs? How to dovetail public interests and the companies’ desire to maximize profits for their owners and shareholders? Finally, “national security”-boosting measures and restrictions imposed in the fight against a pandemic both make a breach in “the thin fabric of trade agreements,” that the whole world has been building the past decades.

Besides, the US establishment as a whole remains eager to maintain America’s leading position within the international system. In this effort, as Donald Trump’s first year in the White House clearly demonstrated, America wants more than just reaping “the benefits of bilateral trade relations, ignoring the benefits of participating in international trade agreements. Moreover, practice has shown such agreements can be worked out and implemented without the United States.” For example, right now, America is being held hostage to Saudi Arabia’s frustration with Washington walking back its commitments in the Middle East. Riyadh wants to reformat the global oil market through dumping offers, and the US shale oil industry, where booming extraction has spurred Washington’s readiness to apply sanctions as an instrument of foreign policy pressure, could find itself the first victim.

Western politicians’ and businesses’ past history of “outsourcing” all and everything could sap their desire to “quickly” reduce their dependence on China. True, the existing market configuration may come undone as the situation is getting increasingly unbalanced. Still, the search for “new equilibrium points” is already on. Changing times are always a period of searching for and finding new opportunities. And Western companies are not necessarily “doomed to success” in this race as Chinese manufacturers have repeatedly proved more able to adapt to changing market conditions than anyone else, while Western firms kept losing flexibility and ramping up development and production costs. Finally, it looks like China has already left the peak of the epidemic behind by effectively checking its spread. Chinese stock indices are on the rise. As for the Americans and Europeans, it seems that the main blow looks still ahead.

Theoretically, a possible slowdown of the current model of globalization may somewhat reduce frustration with the existing imbalances in development, but whether this deceleration is actually capable of mitigating the general structural problems that the global economy is facing today remains a question.

Optimists believe that “as the epidemic develops, its relative impact on the economy will decline.” As for the impact of the virus on the economy, it will actually prove beneficial: the growth rate will slow down, but it will be a “healthier,” natural growth. Speculative “bubbles” in the asset markets will burst in a natural way, and the leading central banks will increase the money supply. All this will allow “… leading economies to maintain their growth, albeit at a slower pace, rather than fall into recession.” This means that “a global crisis due to the epidemic is impossible.”

Critics, for their part, believe that the medical consequences of the coronavirus epidemic can prove much less destructive for global development compared with the measures that states may, if necessary, take to combat the spread of the disease. Experts at Oxford Economics are already warning that a policy of limiting communication and freedoms can only exacerbate the crisis and create additional problems in the future.

Ten years after the 2008-2009 crisis the COVID-19 epidemic is once again demonstrating to politicians, the business community and the general public the vulnerability of the current international financial and economic model. “Political pressure will be brought to bear on states and enterprises through consumers.” Many economic entities will try to reorganize production and supply lines, primarily by moving production closer to end consumers. The pandemic is sure to contribute to further “social atomization” and “online escapism.” Trade, education, medicine and the entertainment industry may finally go online.

Finally, the authorities in many countries are likely to work out measures to restore or expand domestic production in strategically important sectors, including the food and pharmaceutical industries. The policy of state support for domestic producers is gaining popularity again.

“The goal is not so much to limit international trade, but to create a reliable domestic market that will be less dependent on conflicts and the challenges posed by global trade.”

The current configuration of the world order is not just becoming ideologically unsustainable. It now appears absolutely impractical and even dangerous, in the technical sense of the word, in the event of new global upheavals, whether humanitarian, technological or climatic. Globalization will obviously continue to evolve, both ideologically and from the standpoint of application. There is no way that new contacts between people and countries can be completely prevented, but globalization will be taking on new forms, no doubt about that. The international community will have to find a new balance between the priorities of national and global development. Under the circumstances, it is imperative for Russia, just like for any other country, to keep pace with the demands of the day.  From our partner International Affairs

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Europe

The Leaders of the Western World Meet

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The annual meeting of the G7 comprising the largest western economies plus Japan is being hosted this year by the United Kingdom.  Boris Johnson, the UK Prime Minister has also invited Australia, South Korea, South Africa and India.  There has been talk of including Russia again but Britain threatened a veto.  Russia, which had been a member from 1997, was suspended in 2014 following the Crimea annexation.  

Cornwall in the extreme southwest of England has a rugged beauty enjoyed by tourists, and is a contrast to the green undulating softness of its neighbor Devon.  St. Ives is on Cornwall’s sheltered northern coast and it is the venue for the G7 meeting (August 11-13) this year.  It offers beautiful beaches and ice-cold seas.

France, Germany. Italy, UK, US, Japan and Canada.  What do the rich talk about?  Items on the agenda this year including pandemics (fear thereof) and in particular zoonotic diseases where infection spreads from non-human animals to humans.  Johnson has proposed a network of research labs to deal with the problem.  As a worldwide network it will include the design of a global early-warning system and will also establish protocols to deal with future health emergencies.

The important topic of climate change is of particular interest to Boris Johnson because Britain is hosting COP26  in Glasgow later this year in November.  Coal, one of the worst pollutants, has to be phased out and poorer countries will need help to step up and tackle not just the use of cheap coal but climate change and pollution in general.  The G7 countries’ GDP taken together comprises about half of total world output, and climate change has the potential of becoming an existential problem for all on earth.  And help from them to poorer countries is essential for these to be able to increase climate action efforts.

The G7 members are also concerned about large multinationals taking advantage of differing tax laws in the member countries.  Thus the proposal for a uniform 15 percent minimum tax.  There is some dispute as to whether the rate is too low.

America is back according to Joe Biden signalling a shift away from Donald Trump’s unilateralism.  But America is also not the sole driver of the world economy:  China is a real competitor and the European Union in toto is larger.  In a multilateral world, Trump charging ahead on his own made the US risible.  He also got nowhere as the world’s powers one by one distanced themselves.

Secretary of the Treasury Janet Yellen is also endorsing close coordination in economic policies plus continued support as the world struggles to recover after the corona epidemic.  India for example, has over 27 million confirmed cases, the largest number in Asia.  A dying first wave shattered hopes when a second much larger one hit — its devastation worsened by a shortage of hospital beds, oxygen cylinders and other medicines in the severely hit regions.  On April 30, 2021, India became the first country to report over 400,000 new cases in a single 24 hour period.

It is an interdependent world where atavistic self-interest is no longer a solution to its problems.

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Revisiting the Bosnian War

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Genocide is not an alien concept to the world nowadays. However, while the reality (and the culprit) is not hard to profile today, history is ridden with massacres that were draped and concealed from the world beyond. Genocides that rivaled the great warfares and were so gruesome that the ring of brutality still pulsates in the historical narrative of humanity. We journey back to one such genocide that was named the most brutish mass slaughter after World War II. We revisit the Bosnian War (1992-95) which resulted in the deaths of an estimated 100,000 innocent Bosnian citizens and displaced millions. The savage nature of the war was such that the war crimes committed constituted a whole new definition to how we describe genocide.

The historical backdrop helps us gauge the complex relations and motivations which resulted in such chaotic warfare to follow suit. Post World War II, the then People’s Republic of Bosnia and Herzegovina joined the then Federal People’s Republic of Yugoslavia. Bosnia-Herzegovina became one of the constituent republics of Yugoslavia in 1946 along with other Balkan states including Croatia, Slovenia, Macedonia, Montenegro, and Serbia. As communism pervaded all over Yugoslavia, Bosnia-Herzegovina began losing its religion-cultural identity. Since Bosnia-Herzegovina mainly comprised of a Muslim population, later known as the Bosniaks, the spread of socialism resulted in the abolition of many Muslim institutions and traditions. And while the transition to the reformed Federal Republic of Yugoslavia in 1963 did ease the ethnic pressure, the underlying radical ideology and sentiments never fully subsided.

The Bosniaks started to emerge as the majority demographic of Bosnia and by 1971, the Bosniaks constituted as the single largest component of the entire Bosnia-Herzegovina population. However, the trend of emigration picked up later in the decades; the Serbs and the Croats adding up to their tally throughout most of the 70s and mid-80s. The Bosnian population was characterized as a tripartite society, that is, comprised of three core ethnicities: Bosniaks, Serbs, and Croats. Till  1991, the ethnic majority of the Bosniaks was heavily diluted down to just 44% while the Serbian emigrants concentrated the Serbian influence; making up 31% of the total Bosnian population.

While on one side of the coin, Bosnia-Herzegovina was being flooded with Serbs inching a way to gain dominance, the Yugoslavian economy was consistently perishing on the other side. While the signs of instability were apparent in the early 80s, the decade was not enough for the economy to revive. In the late 80s, therefore, political dissatisfaction started to take over and multiple nationalist parties began setting camps. The sentiments diffused throughout the expanse of Yugoslavia and nationalists sensed an imminent partition. Bosnia-Herzegovina, like Croatia, followed through with an election in 1990 which resulted in an expected tripartite poll roughly similar to the demographic of Bosnia. The representatives resorted to form a coalition government comprising of Bosniak-Serb-Craot regime sharing turns at the premiership. While the ethnic majority Bosniaks enjoyed the first go at the office, the tensions soon erupted around Bosnia-Herzegovina as Serbs turned increasingly hostile.

The lava erupted in 1991 as the coalition government of Bosnia withered and the Serbian Democratic Party established its separate assembly in Bosnia known as ‘Serbian National Assembly’.  The move was in line with a growing sentiment of independence that was paving the dismantling of Yugoslavia. The Serbian Democratic Party long envisioned a dominant Serbian state in the Balkans and was not ready to participate in a rotational government when fighting was erupting in the neighboring states. When Croatia started witnessing violence and the rise of rebels in 1992, the separatist vision of the Serbs was further nourished as the Serbian Democratic Party, under the leadership of Serb Leader Radovan Karadžić, established an autonomous government in the Serb Majority areas of Bosnia-Herzegovina.

The vision and the actions remained docile until the ring of independence was echoed throughout the region. When the European Commission (EC), now known as the European Union (EU), and the United States recognized the independence of both Croatia and Slovenia, Bosnia-Herzegovina found itself in a precarious position. While a safe bet would have been to undergo talks and diplomatic routes to engage the Serbian Democratic Party, the Bosnian President Alija Izetbegović failed to realize the early warnings of an uprising. Instead of forging negotiations with the Bosnian Serbs, the Bosniak President resorted to mirror Croatia by organizing a referendum of independence bolstered by both the EC and the US. Even as the referendum was blocked in the Serb autonomous regions of Bosnia, Izetbegović chose to pass through and announced the results. As soon as the Bosnian Independence from Yugoslavia was announced and recognized, fighting erupted throughout Bosnia and Herzegovina.

The Bosnian Serbs feared that their long-envisioned plan of establishing the ‘Great Serbia’ in the Balkans was interred which resulted in chaos overtaking most of Bosnia. The blame of the decision, however, was placed largely on the Bosniak president and, by extension, the entire ethnic majority of the Bosniaks. The Bosnian Serbs started to launch attacks in the east of Bosnia; majorly targeting the Bosniak-dominated towns like Foča, Višegrad, and Zvornik. Soon the Bosnian Serb forces were joined by the local paramilitary rebels as well as the Yugoslavian army as the attacks ravaged the towns with large Bosniak populations; swathing the land in the process. The towns were pillaged and pressed into control whilst the local Bosniaks and their Croat counterparts were either displaced, incarcerated, or massacred.

While the frail Bosnian government managed to join hands with the Croatian forces across the border, the resulting offense was not nearly enough as the combination of Serb forces, rebel groups, and the Yugoslavian army took control of almost two-thirds of the Bosnian territory. The Karadžić regime refused to hand over the captured land in the rounds of negotiations. And while the war stagnated, the Bosniak locals left behind in small pockets of war-ravaged areas faced the brunt in the name of revenge and ethnic cleansing.

As Bosniaks and Croats formed a joint federation as the last resort, the Serbian Democratic Party established the Republic Srpska in the captured East, and the military units were given under the command of the Bosnian-Serb General, Ratko Mladic. The notorious general, known as the ‘Butcher of Bosnia’, committed horrifying war crimes including slaughtering the Bosniak locals captured in violence, raping the Bosniak women, and violating the minors in the name of ethnic cleansing exercises. While the United Nations refused to intervene in the war, the plea of the helpless Bosniaks forced the UN to at least deliver humanitarian aid to the oppressed. The most gruesome of all incidents were marked in July 1995, when an UN-declared safe zone, known as Srebrenica, was penetrated by the forces led by Mladic whilst some innocent Bosniaks took refuge. The forces brutally slaughtered the men while raped the women and children. An estimated 7000-8000 Bosniak men were slaughtered in the most grotesque campaign of ethnic cleansing intended to wipe off any trace of Bosniaks from the Serb-controlled territory.

In the aftermath of the barbaric war crimes, NATO undertook airstrikes to target the Bosnian-Serb targets while the Bosniak-Croat offense was launched from the ground. In late 1995, the Bosnian-Serb forces conceded defeat and accepted US-brokered talks. The accords, also known as the ‘Dayton Accords’, resulted in a conclusion to the Bosnian War as international forces were established in the region to enforce compliance. The newly negotiated federalized Bosnia and Herzegovina constituted 51% of the Croat-Bosniak Federation and 49% of the Serb Republic.

The accord, however, was not the end of the unfortunate tale as the trials and international action were soon followed to investigate the crimes against humanity committed during the three-year warfare. While many Serb leaders either died in imprisonment or committed suicide, the malefactor of the Srebrenica Massacre, Ratko Mladic, went into hiding in 2001. However, Mladic was arrested after a decade in 2011 by the Serbian authorities and was tried in the UN-established International Criminal Tribunal for Yugoslavia (ICTY). The investigation revisited the malicious actions of the former general and in 2017, the ICTY found Ratko Mladic guilty of genocide and war crimes and sentenced him to life in prison. While Mladic appealed for acquittal on the inane grounds of innocence since not he but his subordinates committed the crimes, the UN court recently upheld the decision in finality; closing doors on any further appeals. After 26-years, the world saw despair in the eyes of the 78-year-old Mladic as he joined the fate of his bedfellows while the progeny of the victims gained some closure as the last Bosnian trail was cased on a note of justice.

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Greece And Yugoslavia: A Brief History Of Lasting Partitions

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Prior to the 1992-1995 Balkan war, the European Community delegated the British and Portugese diplomats, Lord Carrington and Jose Cutileiro, to design a suitable scheme for ethno-religious partition of Bosnia-Herzegovina, and in February 1992 they launched the Lisbon Conference, with the aim of separating Bosnian ethno-religious communities and isolating them into distinct territories. This was the initiation of the process of partition, adopted in all subsequent plans to end the war in Bosnia. However, such a concept was stipulated by Carrington and Cutileiro as the only available when there was no war to end, indeed, no war in sight; and, curiously, it has remained the only concept that the European Community, and then the European Union, has ever tried to apply to Bosnia.

Contrary to the foundations of political theory, sovereignty of the Bosnian state was thus divided, and its parts were transferred to the three ethno-religious communities. The Carrington-Cutileiro maps were tailored to determine the territorial reach of each of these communities. What remained to be done afterwards was their actual physical separation, and that could only be performed by ethnic cleansing, that is, by war and genocide. For, ethno-religiously homogenous territories, as envisaged by Carrington and Cutileiro, could only be created by a mass slaughter and mass expulsion of those who did not fit the prescribed model of ethno-religious homogeneity. The European Community thus created a recipe for the war in Bosnia and for the perpetual post-war instability in the Balkans. Yet, ever since the war broke out, the European diplomatic circles have never ceased claiming that this ‘chaos’ was created by ‘the wild Balkan tribes’, who ‘had always slaughtered each other’. There was also an alternative narrative, disseminated from the same sources, that Russia promoted the programme of ‘Greater Serbia’, which eventually produced the bloodshed in Bosnia and Kosovo.

Facts on the ground, however, do not support either of these narratives. All these ‘tribes’ had peacefully lived for centuries under the Ottoman and Habsburg empires, until nationalist ideas were imported into Serbia and Greece at the beginning of the 19th century. On the other hand, Russia’s influence in the Balkans could never compete with the influence of the Anglo-French axis. The latter’s influence was originally implemented through the channels of Serbian and Greek nationalisms, constructed on the anti-Ottoman/anti-Islamic and anti-Habsburg/anti-Catholic grounds, in accordance with strategic interests of the two West European powers to dismantle the declining empires and transform them into a number of puppet nation-states. In these geopolitical shifts, nationalist ideologies in the Balkans utilized religious identities as the most efficient tool for mobilization of the targeted populations and creation of mutually exclusive and implacable national identities.

The pivotal among these nationalist ideologies has been the Serb one,  built on the grounds of Orthodox Christianity, with its permanent anti-Islamic and anti-Catholic agenda. The existence and expansion of Serbia was always explicitly backed by London and Paris – from a semi-autonomous principality within the Ottoman territory in the 1830s and the creation of the Kingdom of Serbia in 1882, through the 1912-13 Balkan wars and World War I, to its expansion into other South Slavic territories in the form of the Kingdom of Serbs, Croats and Slovenes (later, the Kingdom of Yugoslavia), promoted at the Versailles Peace Conference in 1919.

Eventually, the Serbian elites – supported by the Anglo-French axis, again – used the dissolution of the communist Yugoslavia as an opportunity for implementation of the 19th-century ‘Greater Serbia’ programme, that is, Serbia’s expansion in all the Yugoslav territories populated by the Orthodox Christians. However, this time ‘Greater Serbia’ was used as a catalyst in a bigger geopolicial reshuffling advocated by the UK and France – the simultaneous implementation of four ethnnically homogenous greater-state projects, including ‘Greater Serbia’ (transferring the Orthodox-populated parts of Bosnia, plus Montenegro and the northern part of Kosovo, to Serbia), ‘Greater Croatia’ (transferring the Catholic-populated parts of Bosnia to Croatia), ‘Greater Albania’ (transferring the Albanian-populated parts of Kosovo and Macedonia to Albania) and ‘Greater Bulgaria’ (transferring the Slavic parts of Macedonia to Bulgaria).

Since 1990s, ethno-religious nationalisms in the Balkans have served only  this geopolitical purpose – creation of ethno-religiously homogenous ‘greater’ states, including the disappearance of Bosnia and Macedonia, whose multi-religious and multi-ethnic structure has been labelled by the British foreign policy elites as “the last remnant of the Ottoman Empire“ that needs to be eliminated for good. The only major foreign power that has opposed these geopolitical redesigns is the US, which has advocated the policy of inviolability of the former Yugoslav republics’ borders. Yet, the US has never adopted a consistent policy of nation-building for Bosnia and Macedonia, which would be the only one that could efficiently counter the doctrine of ethno-religious homogeneity promoted by the UK and France and supported by most EU countries.   

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