12 Steps Towards “Fair” Globalization

 

New Globalization“

Today‘s globalization, (largely unhindered cross-border flows of goods and services, financial services, investments and persons) has increased and changed form since the liberalization of capital flows („Big Bang“) in the early 1980s. Richard Baldwin (2016) adds that this „new globalization“ or „Hyper-Globalization“ is characterized by the importance of knowledge flows across borders. These made possible a different business model from previous times, because it makes it profitable to create „value chains“ across borders in order to cost-efficiently produce products and services. A new division of labor across the globe is the result, where multinational corporations locate and source components according to the location‘s cost advantages, resource availability, and know-how. Globalized finance helps to eliminate previously existing barriers.

This „new globalization“ has also changed the previously existing balance of (political) power between workers, capital and the state by giving multinational corporations (MNC) previously unknown access to capital and political influence (Rothschild 2005). It also creates a new division in every country between large corporations – which yield political influence by being able to threaten „exit“ (Hirschmann 1970) if their conditions for no or light regulation and first-class infrastructure are not met – and the large number of medium and small-scale enterprises which need protection from the state in order to uphold competition, prevent oligopoly and to promote exports. As during the past 40 years the influence of organized labor has been reduced, MNC are able to influence and prevent rules and regulations which might threaten their profitability. They prefer a „flat earth“ without impediments to their global investment decisions (Rothschild 2009). Thus, a major power shift has occurred between the decades after World War II, when there was a relative balance of power between (organized) labor, capital and the state. Today, large corporations have captured the state (Altzinger 2017) and can play workers from different locations against each other.

The resulting long-term stagnation of real wages in the OECD countries, the increase in income and wealth inequality (Piketty 2014, Milanovic 2016), the increased pressure and labor flexibility on working conditions, have promoted the loss of confidence of large parts of the populations in OECD countries in their governments, their „elites“. The election and activities of D. Trump in the US, the Brexit vote in Great Britain, the rise of right-wing „populist“ parties in many European countries – all these are results of these changes in technology and the concomitant „new globalization“ (Rodrik 2016, 2017). A pervasive sense of existential insecurity, fear about the future and resistance to change are the result. Their exploitation by populist politicians threaten society‘s cohesiveness.

While the rising power of MNC, many of which are able to avoid paying (their fair of) taxes in their home countries (Zucman 2016), threatens the very existence of the global order and has reduced the power of regulation of nation states, populist politicians extol the virtues of exactly this nation state („America first“; Russian expansionism; „take back control“,etc.). While rational argument would call for global regulation of MNC (and thus globalization), since national regulation has decreased, previous attempts of establishing effective global governance (UNO, G-7, G-20) are effectively being dismantled, and more and more countries „go it on their own“ (Bayer 2017). In the meantime, populations distrust established political institutions and parties, sometimes hoping and supporting „strong men“ or political movements (5 Stelle, FPÖ, AfD, Front National, etc.) which promise „easy solutions“, disregarding the complexity and especially the inter-relatedness of economic ties. The failure of establishing globally accepted governance structures gives way to the stronger setting the rules, at the expense of global society. This asymmetric power structure threatens not only the liberal global order which extolled free trade, but also the cohesiveness of national societies, and thus political stability.

Single Market as „Super TTIP“

The EU Single Market is probably the „role model“ of this new globalization, if at a regional level. Its basic premise of the „Four Freedoms“ (unfettered movement of capital, finance, goods and labor across EU borders) has been called „TTIP on steroids“ by R. Baldwin (2016b). By TTIP is meant the Trans-Atlantic Trade and Investment Partnership which was negotiated between the EU and the US for a number of years, and has recently been stalled, in Europe because of large protests by citizens, in the US because of the President‘s „America First“ agenda. Many of the new trade agreements between the EU and a number of countries (Canada, Japan, Korea, among them) likewise go far beyond „traditional“ trade agreements which were mainly concerned with removing tariffs and quotas. Now they also atttempt to reduce non-tariff barriers, i.e. technical and quality regulations on goods (and services), promote cross-border investment and install grievance and arbitration mechanisms outside countries‘ judicial systems. Critics claim that they unilaterally benefit the profitability of large corporations, threaten labor conditions and jobs, lead to a race-to-the-bottom with respect to health and phytosanitary as well as environmental regulations, and threaten national and regional identities under the guise of promoting trade and lowering costs. National governments only recently have begun to take the backlash against these agreements – seen as the epitomy of globalization – seriously. However, still the U.S. President wants trade agreements which benefit America, the EU continues along this path with a number of trade agreements in the pipeline, Asian countries are attempting to revive TPP (Trans-Pacific Trade Agreement) without the US, while at the same time the relevant global institutions, in this case the World Trade Organizations, are left to languish.

The Positive Side of Globalization

Foreign trade is one of the mainstays of economic betterment. After World War II trade has expanded approximately twice as fast as world GDP, benefitting many countries and their citizens, if in an unequal manner. The „new“ globalization, if left unregulated, however has reached limits of acceptability in the OECD countries. The point is not to stop trading across borders, but to spread its benefits to all countries and to all citizens – without further endangering the vulnerable environment.

Globalization cannot be reversed. Cost advantages in three areas are of essence and will also in the future drive aspects of globalization: Transport costs have already reached a new low: inclusion of the damages done to the environment would increase costs and lead to more localized production; Costs for the transmission of ideas have decreased by means of new information and communications technologies. More can be expected; The third component, the costs of outsourcing persons with knowhow, which today are still high and hold the owners of know-how close to headquarters, will only change significantly once artificial intelligence makes these persons‘ local presence obsolete – and will then lead to a new level of globalization (Baldwin 2016). But even if globalization cannot be reversed, it can be regulated in such a way as to benefit all people, instead of only large corporations (Rodrik 2016).

Power and Regulation

A strategy to rein in globalization encounters more than just technical problems. It involves a power struggle, in order to re-establish the tri-partite balance of power between labor, capital and state (Rothschild 2015, Brand 2017). Without being naive, this requires the „people“, as workers and consumers, as providers of taxes and family services, as the nucleus of society, to step up and challenge the lobbying and real power of the multinational corporations and their influence on the state. In many instances, civil society in all its formations, has attempted to regain power, and has been partially successful at the local and sometimes national levels. While this assumes that „the people“ have homogeneous interests, in reality populations are also split into various views-of-the-world and the ensuing positions. But before tackling these „internal divisions“ it would be important to step up to get governments to once more pursue the interests of the „99 percent“.

12 Steps

Abstracting from the power question, the following steps could make globalization more acceptable to workers and consumers, because if successful citizens would see that they can benefit from it. These steps are also designed to make globalization pursue sustainability objectives, thus combining economic, social and environmental benefits in an even way.

1. Take stock of existing trade and investment and migration regimes with a view to analyze social and environmental effects. This analysis needs to be accomplished both at a national and a global level. Effects need to be analyzed also according to income levels, social effects and which interest groups benefit or suffer losses.

2. Each country‘s and region‘s economic policy decisions should be based on a regular consultation and dialogue with social partners and non-governmental organizations, with a view to find the desired foreign involvement of the economy and society. Effects on labor markets, social transfers, health and environment should be discussed. This should be the basis for economic policy and foreign trade and investment decisions. In effect, this may lead to lower foreign exposure than today – without leading to misplaced autarky ideas or undue protectionism. Considerations must go far beyond what businesses call „Standortpolitik“ – gaining competitive advantage over foreign rivals and leading to a run on corporate tax rates and putting environmental and social concerns under pressure. Not only defensive policies must be considered, but a broad spectrum of training, labor market, innovation, social and environmental policy measures are necessary to prepare the population for further globalization – and make it more palatable.

3. The domestic market of the EU (at present 508 Mill people and 16 trill $ GDP) is large enough to compensate for some lost export opportunities mentioned above. The aim of the EU must be to improve social cohesion, public health, environmental situation, in short increase the wellbeing of their populations and remain „competitive“ also on the cost side. Some outsourced component productions can be repatriated, barriers can and should be erected against predatory and potentially politically motivated mergers and acquisitions by foreign state-related companies. The existing mechanisms within the EU to compensate for such losses need to be strengthened.

4. Further active strategies to promote globalization need to give equal weight to environmental and social concerns, as to economic ones. Close inclusion of civil society into decision-making can reduce the negative (perceived or real) effects of further globalization. They also strengthen democracy. The general interests of society need to trump interests of those groups that have up to now one-sidedly profited from globalization.

5. Since the internal structures of global supply chains are not known to public regulators, multinational corporations need to be fully transparent about what is produced where, which costs arise where, where which social and environmental effects occur and where they pay how much in taxes. Such binding regulations must be effected at the EU level, single-country regulations can easily be subverted.

6. As well as tax transparency and the establishment of minimum corporate tax rates, corporations must be made committed to follow strict corporate social responsibility rules. Existing voluntary rules are not sufficient. Society as stakeholder must trump narrow shareholder value activity.

7. When trade agreements are concluded between countries/regions with very different levels of income and social and environmental standards, protective mechanisms, e.g. like those used to hedge against foreign exchange fluctuations, need to be installed.

One possibility would be to force enterprises which outsource components to pay part of their cost savings into a fund from which both new employment and training for those who lost their job could be financed, but also labor relations, income and social protection for the host country could be improved. A higher taxation of profit could also contribute to this fund.

During gobalization the share of labor in OECD countries has fallen significantly (Milanovic 2016). This calls for a very basic discussion on how the gains from globalization should be divided and how taxation of global companies should be levied. OECD and IMF have begun to make efforts to propose international rules, but much more will be needed to revert to a fairer distribution of income.

8. The downward escalation of corporate tax rates – argued by individual states as necessary to maintain „competitiveness“ of the location needs to be stopped. Transfer pricing, low or zero tax rates, storing profits and tax havens – all these need to stop. The best way to achieve this would be to reverse the burden of proof, i.e. enterprises would have to prove that they have paid appropriate taxes where the economic activity occurred. An international body, akin to the Basle Committee, should ascertain the fairness of local acquisition of firms regimes and prevent competitive bidding by offering unfair benefits to investing companies.

9. The dogma that markets in less developed countries need to be opened to foreign competition needs to be qualified as a development strategy. Effects of market access on local (small) producers, especially in the food sector, on local handicraft production on small and medium-sized enterprises, on national and cultural customs need to make way for more autonomous development paths which also accept traditional „infant industry“ arguments as legitimate.

10. The dogma of free capital flows which affords (largely anonymous) capital markets the role of assessing individual countries‘ developments and policies must give way to a global financial policy which is driven by the interests of all of society. International financial institutions must accept that stability of investment relations have to have precedence before the short-term interests of financial investors. National banks must become accountable to national and global society.

11. Forthcoming trade agreements (Baghwati has called the likes of TTIP and TTP „non-trade agreements“) are positive insofar as they further reduce tariff barriers and quotas, but must refrain from levelling standards (Rodrik 2016). This is especially true for trade agreements between countries and regions with very different cultural traditions, since elimination of culturally important standards especially threatens citizens‘ identity and thus trust in the political system. Inclusion of direct investment requires renewed discussion, especially with respect to foreign takeovers of basic social and economic infrastructure. Dispute resolution mechanisms need to be publicly legitimated and integrated into existing legal systems.

12. From a global perspective, and especially concerning less developed countries, elimination of patent protection could reduce some of the excesses of modern globalization. It would promote know-how transfer from more into less developed countries, would reduce exorbitant costs of pharmaceuticals for some of the ravaging diseases and could speed up the development process. It would need to be accompanied by mechanisms producing positive incentives for further pharma (and other) research benefitting mankind where health reasons require it most strongly.

Conclusion

Unfettered globalization has created fear and insecurity because of its uneven effects on income distribution, the deterioration of the environment and the pressure of the liberal welfare state. It threatens the cohesiveness of societies, sows distrust into the political process and leads to xenophobic and protectionist tendencies exploited by populist politicians. It has reduced the regulatory power of nation states to a minimum, without this gap being filled by global governance structures. If left to itself, globalization will lead to a „winner-takes-all“ situation where large and strong enterprises reap all the benefits of globalization, at the expense of social cohesion, the welfare of citizens and the environment. But globalization can be reined in and benefit citizens rather than corporations, if:

– a socially-based economic and foreign trade policy gives equal weight so economic, social and environmental considerations

– the gains from trade and foreign investment are redistributed to those whose jobs have been lost and to the host countries‘ social and labor market improvements

– the fight against tax dodging by large corporations is taken seriously, such that taxes are paid where the economic activity occurs

– differences between regions of standards are seen as part of cultural and historical identities and thus protected from international competition, rather than being seen as non-tariff barriers to trade

– in international negotiations and institutions, the interests of less developed countries are given adequate weight, irrespective of their size and economic development.

Such steps go beyond technical solutions and will require a fierce power struggle. Vested interests in the present system by large multinational corporations and large developed countries need to be tackled to the benefit of global society at large.

Literature:

Altzinger Wilhelm, Globalisierung, Verteilung und Demokratie: Gibt es eine Transformation zum patrimonialen Kapitalismus? In: “Jahrbuch Normative und institutionelle Grundfragen der Ökonomik”  · Band 16 –  Kapitalismus, Globalisierung, Demokratie, Martin Held, Gisela Kubon-Gilke, Richard Sturn (Hg.); Metropolis-Verlag (in print)

Baldwin Richard, The Great Convergence. Information Technology and the New Globalization, Harvard University Press, Cambridge, Nov. 2016

Bayer Kurt (2016). Digitalization, Mode of Production and Working Conditions – A Primer, https://kurtbayer.wordpress.com/2016/09/17/digitalization-mode-of-production-and-working-conditions-a-primer, 17.9.2016

Bayer Kurt, Giner-Reichl Irene (Hg), Entwicklungspolitik 2030. Auf dem Weg zur Nachhaltigkeit, Manz, Wien 2017.

Bayer Kurt. Wie könnte „Gute Globalisierung“ aussehen? Wirtschaft und Gesellschaft 43, 2, 2017, Wien

Brand Ulrich, Wissen Markus. Imperiale Lebensweise, oekom, München 2017

Bürger Hans, Rothschild Kurt. Wie die Wirtschaft die Welt bewegt, lesethek, Wien 2009.

Hirschman Albert. Exit, Voice and Loyalty. Harvard University Press, Cambridge, Mass., 1970.

Milanovic, Branko. Global Inequality: A New Approach for the Age of Globalization, Belknap Press, Harvard 2016.

Rodrik, Dani (2016a). From Hyperglobalization to Sensible Globalization, Sept. 16, 2016, www.rodrik.typepad.com.

Rodrik, Dani. (2016b). Don’t Cry Over Dead Trade Agreements, Project Syndicate, Dec. 8, 2016, https://www.project-syndicate.org/commentary/no-mourning-dead-trade-agreements-by-dani-rodrik-2016-12

Rodrik, Dani, Populism and the Economics of Globalization, #23559 (IFM ITI POL) http://papers.nber.org/papers/W23559?utm_campaign=ntw&utm_medium=email&utm_source=ntw

Rothschild Kurt, New Worlds – New Approaches. A Note on future Research Strategies, Kyklos 58/3, 2005

Zucman, Gabriel, Taxing Across Borders: racking Personal Wealth and Corporate Profits, Journal of Economic Perspectives 28/4, 2014.

Advertisements

Leave a comment

Filed under Crisis Response, European Union, Global Governance, Socio-Economic Development

Chinesische Direktinvestitionen: Ein Danaergeschenk?

(veröffentlicht als Kommentar in der Wiener Zeitung am 27.7.2017)

Der trojanische Priester Laokoon hatte mit seiner Befürchtung „Ich fürchte die Griechen, auch wenn sie Geschenke bringen“ recht: Im Trojanischen Pferd versteckten sich bewaffnete Griechen, die als das hölzerne Pferd in die Stadt gebracht wurde, aus dem Pferd stürmten und die Stadt eroberten. Laokoon und seine beiden Söhne bezahlten diese Weissagung mit dem Tod.

Lange Zeit galt das Hereinbringen von Investitionen aus dem Ausland in Form von Firmenübernahmen („Direktinvestitionen“) als wünschenswert und sogar als „Standortqualitätsindikator“ und wurde und wird von Regierungen aktiv betrieben. Um den Markt zu regulieren, um Chancengleichheit zwischen alten und neuen Aktionären und Neutralität des Aufsichtsrates herzustellen, brachte die Europäische Kommission 2004 nach 14-jährigen Verhandlungen die sog Übernahmerichtlinie in Umlauf, die in der Folge von den EU-Staaten umgesetzt wurde. Firmenübernahmen galten als ein Herzstück der „freien Marktwirtschaft“.

In einer Evaluierung 2012 über die Wirksamkeit der Direktive wurde sie als weitgehend wirkungslos beschrieben. Sie befasste sich allerdings nur am Rande mit der Möglichkeit von Regierungen, Übernahmen aus staatspolitischen Gründen zu unterbinden.

Mit der Erstarkung der chinesischen Wirtschaft geht auch deren Umgestaltung von investitions- zu konsumgetriebener Wirtschaft einher. Damit sinken Investitionsmöglichkeiten im Lande und wächst das Interesse an ausländischen Firmen und Vermögenswerten. Zum Teil geht dies auf das chinesische „Seidenstraßenprojekt“ zurück, welche zu Land (Schiene, Straße) und zu Wasser chinesische Exportwege sichern will: dies erklärt etwa die Übernahme des Hafens von Athen durch chinesische Investoren.

Nun hat man aber auch in Europa gemerkt, dass ein allzu freier Zugang chinesischer Firmen (vielfach in chinesischem Staatseinfluss) zu europäischer Infrastruktur und Hochtechnologie strategisch langfristig Nachteile bringen kann. Der Fall des Augsburger Roboterherstellers Kuka hat 2016 die deutsche Bundesregierung alarmiert. Auch Frankreich und Italien haben die EU-Kommission beauftragt, Regeln für zulässige Beschränkungen auszuarbeiten.

Im Vorfeld wird nun Deutschland tätig und plant den Tatbestand der „Gefährdung der öffentlichen Ordnung“ als zulässigen Grund für Übernahmeverbote (vor allem von Chinesen) für „kritische“ Infrastruktur zu definieren. Dabei geht es um Softwarefirmen, sowie um Infrastruktur (Energie, Transportwege, Flughäfen, Häfen). Ebenso wie man in Europa (die USA sind da schon deutlich länger und schärfer tätig) nunmehr auch den Schutz heimischer Industrieprodukte (Stahl) und den Zugang zu Materialien sichern will, geht es nunmehr auch dem „freien“ Markt über Eigentumsrechte an den Kragen. Die EU-Kommission ist auch dabei. Ob das „Protektionismus“ oder legitimes Interesse ist, müssen die Hohepriester der Marktwirtschaft beantworten.

4 Comments

Filed under European Union, Global Governance, Socio-Economic Development

Wie könnte „gute“ Globalisierung aussehen?

Kurt Bayer

Ungezügelte Globalisierung hat neben ihren positiven Effekten dazu beigetragen, fremdenfeindlichen Protektionismus wieder salonfähig zu machen und das Vertrauen der Bevölkerung in ihre Regierungen zu untergraben. Handel und Auslagerungen haben in den Herkunftsländern zu Lohndruck und Arbeitslosigkeit geführt, aber die Gewinne gesichert. Die ungleichere Einkommensverteilung schürt Zukunftsängste und treibt PopulistInnen UnterstützerInnen zu. Globalisierung muss auf globaler wie nationaler Ebene reguliert werden, damit sie zu einem Instrument der Verbesserung der Lebensumstände für möglichst viele Menschen wird. Dabei sind soziale, ökologische und ökonomische Ziele mit gleicher Intensität zu verfolgen.

Veröffentlicht in Wirtschaft und Gesellschaft, 2/2017, S. 243–261

Leave a comment

Filed under Global Governance, Socio-Economic Development

The End of Global Governance

The G-20 Summit in Hamburg has confirmed what I had diagnosed already earlier: The pretense of the G-20 to act as the major institution of global governance has shown to be greatly exaggerated. Already before the re-nationalization issues exhibited by the US election, the Brexit referendum, Polish and Hungarian behavior in the EU, and many other more recent manifestations, the G-20 could never legitimately speak „for the world“, since its composition was restricted to the 20 „most systemically relevant countries“. What about the small ones, the poor ones, the ones not large enough to be deemed (by whom??) systemically important? They have not conveyed a mandate to the G-20. True, 20 is better than 7 – but it is not enough, especially given the fact that all actions of the included 20 largest economies have spillover effects on many other countries: Who speaks for them? A number of analysts, myself included (see Bayer 2007 and 2017) have made suggestions to make the G-20 more representative, to give them legitimacy – but this has not happened.

But crying over spilt milk is of no use. The conduct of the Hamburg summit has shown that the major value of this meeting was to provide opportunity for some of these leaders to have bilateral meetings, or meetings in small groups – all outside, or in the fringes of the G-20 meeting itself. To provide such a venue is not without value – but it has nothing to do with the pretense of „global governance“, since in these meetings each country impresses on its „partner“ its own interests and negotiates a bilateral „deal“ – often to the detriment of the countries not present.

The official communiqué shows the paucity of joint results: a confirmation to further engage in trade and cross-border investment („free and fair“ – whatever that may mean!), a 19-member commitment to pursue the Paris Agenda, a commitment to „digitize“ all citizens, and a commitment to combat terrorism. In this light the horrendous damage inflicted on Hamburg‘s streets and police was even more out-of-order than this despicable nihilistic violence requires condemnation.

The „spin“ that these leaders give in their respective press conferences about their meetings (including the official one) has little to do with „truth“. Everybody attempts to show to the press and her citizens that they forcefully deposited the points close to the hearts of their voters. It is interesting to not that the US President did not hold a press conference, thus giving his first-met counterpart Russia the opportunity to declare that he (Putin) has convinced Trump that Russia had not interfered with the recent US election and that Trump had accepted this. Even Trump‘s following twitterisms did not deny that. It may well be that Trump can twitter tough statements when in his familiar Trump Tower surroundings, but that this self-declared dealmaker wilts like a daisy when facing clever and cunning counterparts in person.

It may be good news that Trump and Putin agreed on some kind of ceasefire in a small part of Syria. But given the amount of global problems, many of which Merkel had put on the G-20 Agenda, this is a poor outcome. The interests of the G-20 (and of many other countries not represented) are as diverse as ever. The spirit of cooperation with a view to jointly tackle the pressing global problems has vanished – if it ever existed. The withdrawal of the US as champion of the „free world“ has encouraged all countries to also primarily pursue their own interests: „My country first“ – and to hell (Hambug-related pun intended!) with everybody else. Angela Merkel and Emanuel Macron may, one more reluctant than the other, dream of global cooperation. The Hamburg G-20 Summit has not been able to provide it. It will not come from any of the existing institutions, it will not come from the EU (in spite of its much-touted trade deal with Japan), it will not come from China. Citizens, wake up!

 

2 Comments

Filed under Crisis Response, Global Governance, Socio-Economic Development

The G-20: Global “Governor” or Photo Opp.?

On July 7/8, 2017 Hamburg hosts the next G-20 Summit. Germany, and especially Angela Merkel, has put a lot of resources into its preparation (there is an election looming in September): under the heading „Shaping an Interconnected World“ Merkel will attempt to bring some issues of global significance forward, including stability of growth and the financial system, the fight against climate change, inclusive growth, migration, and a number more. As is usual in this format, the agenda of such a summit is the result of ongoing discussions during summits, enriched by national priorities. During the run up to this summit it has become clear that Angela Merkel is attempting to re-establish the G-20 (under German leadership) as the most significant global governance institution, in this sense re-awakening memories of 2008 when under British leadership the G-20 heads of state established themselves as the one global forum ready to combat the incipient economic and financial crisis. At that time there were hopes (also by this writer) that the sense of joint concern and cooperation would lead to better coordination of global economic and social governance.

As has variously been documented, this sense of communality – if it was real at that time – has disappeared during the last 9 years. Today, international media see the bilateral meetings of heads-of-state which will occur at the side of the G-20 meeting in Hamburg as the events with major significance: Putin-Trump, Putin-Xi, Trump-Xi, Modi-Xi, Merkel – …., Macron – ……, Erdogan – ….., etc. The actual joint summit meeting of the 20 heads of state, the EU, the international financial institutions, the OECD, they all will  be reduced to a sideshow.

The world certainly could use an effective, representative global governance architecture. The grip of the Bretton Woods Institutions (IMF, World Bank, WTO) has started to slip, emerging countries created their own structures, the spirit of acting jointly to combat global problems is vaning, competition and vying for supremacy seems king. Not that a strong governance institution is desirable independent of the objectives it pursues. The „Western“ states should be aware that their global dominance, their economic model has severely been damaged as a role model, not least by the recent financial crisis. The strong emergence of China, India, Brazil and others must give way to their interests being iven equal weight.

In the runup to the Hamburg summit John Kirton, head of the G-20 Research Group at the University of Toronto has given a positive assessment of these G-20 Meetings. He records its history which began in 1999 as a meeting of finance ministers and central bank governors of the 20 „most systemically important“ countries of the world and its elevation to the heads of state in 2008. In typical anglo-saxon fascination with measurement, he notes that up to now these heads of state have spent 22 days with each other and have published 140.426 (sic!) words of official conclusions. They have, I quote again, 1.962 exact formulated binding commitments, of which 72% have been implemented. Without me going into more quantitative detail, this report concludes that what the G-20 does, has had positive effects not only for the G-20 countries themselves, but for the wider world insofar as they promote both financial sector stability and the sharing of the fruits of globalisation by everybody. This is doubt ful, given the state of today‘s world.

Looking at the state of the world in July 2017 one could think that this evaluation refers to another world: globally, the brief spirit of cooperation has disappeared, the USA is intent to abandon its role as the „guarantor and promoter“ of post-World War II – global governance and sees its position as one to be improved at the expense of its trading „partners“; Russia is reasserting its own hegemonial role in its neighborhood and the Middle East; China sees prospects of promoting its own trade and economic and political influence in its neighborhood (South China Sea) and via its ambitious Silk road project and trading relations with resource-rich countries; Europe is struggling to maintain a semblance of unity (albeit without a global strategy) in the face of Brexit; re-establishment of national sovereignty has taken hold of many countries; in the rich countries the disaffection of the populace with their political masters has given rise to right-wing populism, as a result of massively rising inequality and fear of insecurity; financial systems have been „saved“ at high costs to taxpayers, only to keep pursuing their instability and inequality-generating activities; the fear about labor-replacing new technologies abounds; migration flows in Asia, Africa, Latin America have increased due to immiserization of large swaths of these continents‘ populations; belligerent activities threaten both civilian populations and the stability of whole regions; climate change and the massive exploitation of environmental capital threaten the world population‘s way of life – and so on. Of course, this state of affairs is not the fault of the G-20 alone, but it is more than blue-eyed to paint the Decade of G-20 Governance as a success story and to continue in this vein.

Let us see this Hamburg Summit as what it can be: a venue of 20 plus important world leaders affording the opportunity to have a number of one-and-one meetings, with the hope that some of the most glaring present faultlines of today‘s world can be ironed out. The joint summit itself will not change one iota of the precarious world situation. Maybe EU countries and China can put pressure on the US to reverse their abandoning the Paris climate accord; maybe some accord can be found to pacify the Mid-East and stem migration flows; maybe a start can be made to improve the economic situation in Africa, with a view to stem migration flows. Merkel seems to be trying, if with the wrong policy prescriptions.

But I would bet a lot on the assessment that the roots of today‘s economic and climate problems, the dominance of a self-serving financial system, the „Western“ way-of-life of exploint nature and natural resources and labor, the multinational-firm-driven mode of globalization at the expense of thes well-being of countries and people – all these will not be addressed, let alone „solved“. In this way I judge that the simultaneous presence of 20 plus world leaders in Hamburg is a missed opportunity to improve the world. It is, as its detractors say, more a photo opportunity and a posturing occasion for heads-of-state than a serious meeting towards a better global governance. Even if Angela Merkel has good intentions, the path to …..-First posturing and the renewed fight for hegemony will not let her.

Leave a comment

Filed under Crisis Response, Global Governance, Socio-Economic Development

CHALLENGES TO GROWTH IN THE WEST BALKAN REGION

Attached is the powerpoint presentation which I gave as a keynote speaker on May 31, 2017 on the occasion of the Austria Connect Southeast Europe Conference in Belgrade:

 

 

Leave a comment

Filed under Crisis Response, Socio-Economic Development

Brexit – Geordnete Trennung oder Rosenkrieg? Ö1 Journal-Panorama | MI | 21.06.2017

=>> Link zum Nachhören (1 Woche lang)

Flaggen Vereinigtes Körnigreich Europäische UnionDiskussion mit

  • Kurt Bayer, Wirtschaftsexperte, ehemaliger Direktor der Weltbank und der Europäischen Entwicklungsbank in London
  • Catherine Martens, EU-Korrespondentin der Deutschen Welle, Brüssel
  • Melanie Sully, britische Politologin und Direktorin des Instituts Go-Governance
  • Jörg Wojahn, Vertreter der EU-Kommission in Österreich
    Diskussionsleitung: Elisa Vass

Jetzt gibt es kein Zurück mehr: Am Montag haben in Brüssel die Verhandlungen über den Austritt Großbritanniens aus der EU begonnen. Vorerst hat man sich einmal auf einen Fahrplan für die Verhandlungen geeinigt, die haarigen Fragen wurden noch nicht angeschnitten: Wie hart oder weich wird der Brexit sein? Werden die Briten Binnenmarkt und Zollunion ganz verlassen? Und was könnten die Verhandlungsergebnisse für die Personenfreizügigkeit, die Grenzkontrollen zwischen Nordirland und Irland sowie für die Wirtschaft bedeuten?

Die EU wird durch den Austritt des großen Mitgliedslandes geschwächt, durch den Wahlsieg des deklarierten Pro-Europäers Emmanuel Macron in Frankreich andererseits gestärkt. Doch wie gehen die Vorstellungen von Deutschland und Frankreich – etwa in der Wirtschaftspolitik – zusammen?

=>> Link zum Nachhören (1 Woche lang)

Leave a comment

Filed under European Union