China continue to growth very fast: US subprime crise does not matter

These day we discovered that China continue to growth at more than 10% rate. The US subprime crise and the developed countries slowdown seems to have any impact.

This is very important. In fact, it is a good indicator that emerging markets succeed to decrease their dependency on developed countries growth and economic situation.

The world is changing. Henceforth, the engine of world growth are any more developed countries but emerging countries. The economic power has shifted. Nothing seeems to slow down emerging countries (especially China, India and ASEAN countries).

Unfortunately, many developed countries policy makers did not seem to have understand this change. In fact, they continue to use global governance institutions like if they were in the 80s when their supremacy was incontestable.

emerging countries global governance growth

Multilateralism is not a goal per se

Many scholars place at the center of their analysis the role of multilateralism. The last example that I red was a post from Richard Baldwin that considers regionalism only as a risk for multilateralism without thinking on its impacts on sustainable development.

Multilateralism should not be a goal per se but a governance tool to achieve sustainable development. It is true that, often, bilateral relations are more asymmetrical. Nevertheless, we should not forget that multilateralism is not a perfect democracy system: power asymmetries matters.

Even if the presence of a bad multilateralism is probably better than its absence, we should maintain our criticism regarding its function and how it works in the reality. In fact, as Cox underlined (1992, p. 496), in the post-World War II,

[…] economic multilateralism meant the structure of world economy most conductive to capital expansion on a world scale; and political multilateralism meant the institutionalized arrangements made at that time [after World War II] and in those conditions for inter-state cooperation on common problems. There was, for some people, an implicit compatibility, even identity between economic and political aspects of multilateralism: political multilateralism had as primary goal the security and maintenance of economic multilateralism, the underpinning of growth in the world capitalist economy.

Furthermore, the main goal of economic multilateralism was to ensure growth in developed countries even if this depended on keeping developing countries in a poverty condition. The problem is that there is not alternatives to multilateralism even if South-South regionalism can help to solve some problems. We can only try to reform it.

In fact multilateralism is still crucial because, as Cox (1992, p. 492) pointed out:

multilateralism can only be understood within the context in which it exists, and that context is the historical structure of world order. But multilateralism is not just a passive, dependent activity. It can appear in another aspect as an active force shaping world order

Multilateralism it is not good per se. It should be assessed against another normative principle: sustainable development.

Economic multilateralism, if we use this kind of assessment, does not achieve spectacular results in the last decades. In fact, it does not avoid the rising asymmetries and inequalities at the world scale. What is more, the only countries that succeed in economic development (i.e. emerging countries) did it by breaking many multilateral rules (WTO agreements, World Bank advises, etc.).

Nevertheless, now multilateralism is changing. The rise of emerging countries change the power equilibrium in global governance institutions. In another post, I will try to assess if this phenomenon is positive or negative for others developing countries.

Bibliography

Cox, R. W. (1992), Multilateralism and world order. Review of International Studies , 18 (2), 494-523

multilateralism global governance emerging countries