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Women’s Week 2023 |“I am a girl, not a woman”: how recognizing diverse girlhoods can foster the inclusion of young mothers in debates on womanhood and girlhood.

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In Uganda, young mothers are predominantly called women, although some young mothers contest that representation and prefer to be called girls.  The normative insistence on categorizing young mothers as women despite girlhood being a transitional phase locks young mothers in an in-between category, a space in which they can be neither girls, nor children, nor women. International Women’s Day celebrations further risk widening the gap between such girls whose daily realities centre on survival, writes Annah Kamusiime. The need to recognize diverse girlhoods is a first step in ensuring that girls are included in discussions on womanhood and girlhood.

During one of the interviews I conducted in 2021 for my PhD research on representations of young motherhood, Nandi, a 16-year-old Ugandan mother, told me, “Even though I am a mother, I am a girl, not a woman”. Her statement is an example of the agentic manoeuvres of girls whose voice remains silenced and their existence pushed to the liminal space – liminal because as mothers, they are in an in-between category where they are not girls anymore, nor children, and nor women, especially when they are not married.

Being a parent is the main marker of transition to adulthood/womanhood; in most of Uganda others also include menarche, a sexual debut, and wifehood. But the young mothers I spoke to did not consider themselves to be adults – women – despite having borne children. And, having borne children, they were no longer children themselves. As a result, their needs as young mothers may not be adequately addressed by efforts that separately target girls, children, or women. Young mothers who fall into none of the marked categories of girl, child, or woman thus face marginalization and exclusion.  In this article, I discuss why the recognition of a distinct category of diverse girlhoods is necessary to further their inclusion – also in celebrating International Women’s Day.

 

‘Girl’ or ‘woman’? How words make worlds

The terms we use are not neutral – the way in which words are combined allows for certain meanings to flourish and for others to be minimized. For instance, consider these two statements: “The girl-child is pregnant” versus “The girl is pregnant”. Both can be used to describe an adolescent mother. But an emphasis on a pregnant girl as a child (as the first statement does) may elicit a different interpretation and response when compared to using only the word ‘girl’. And often such word choices are deliberate. Words make worlds; struggles over meaning are not just about semantics – they are strategic, they have an effect, they shape discourses, actions and rhetoric, and they are contested. Thus, there is a need to be reflexive on how we frame different categories of persons because conceptions shape engagement.

Another example that shows how words matter for girls: While I was writing this article, my 18-year-old daughter read it and told me that at school, their teacher told them that a girl becomes a woman on the day of her sexual debut. I asked her whether that mattered and whether it would make a difference if a girl would be referred to as a woman or a girl. Yes, she said, ‘girl’ and ‘woman’ mean different things, and it matters which is used. As in the case of Nandi, the labels  ‘woman’ placed on a ‘girl’ has specific connotations – it means she engaged in sexual intercourse yet she is expected to be asexual, she is a mother at the wrong time, and she has ruptured normative notions of conceptions of ideal childhood and youth because she is expected to be innocent.  As a result, young mothers are stigmatized and are seen as a threat to the social morals and social order, which fuels their exclusion.

These two examples show that yes, the label of a woman that is placed on girls who are young mothers matter to them even when everyone else may not acknowledge it. Many of the young mothers I have spoken to choose to be called girls, not children, or girl-children, or women. The failure to consider the desire for this distinct categorization means that these young mothers’ voices remain unheard. I therefore argue that we need to reimagine and reconstruct girlhood as diverse and distinct in policy, practice, and debates at different levels-national and international.

 

Girls just wanna be girls

Several renowned scholars studying girlhood, including those highlighted by Claudia Mitchell, have advocated for what they have referred to as the girl-method. Rather than continue to lump girls under either the categories ‘children’, ‘young women’, or ‘women’, they argue that it is vital to add ‘girls’ as a distinct category.  This would remove girls from the shadows and place them in the centre of the discussion on diverse girlhoods, including those of young mothers.

My argument above does not mean that we should dismiss distinct moments like the UN Decade of the Girl Child (1991-2001) and International Day of the Girl Child. Indeed, such moments have been and continue to be an open platform for considering and rethinking issues girls face. However, a merger of ‘girl’ with ‘child’ in what is celebrated as the day of the ‘girl-child’ has been problematized as being passive, essentialist, and homogenizing. My sentiments of the ‘girl-child’ label are that it emphasizes their innocence, vulnerability, and dependency and brings out connotations of powerlessness while also infantilizing girls.

It also poses a risk of illuminating the ‘child’ and marginalizing the ‘girl’ because the ‘child’ may take precedence over the ‘girl’. There are words which are nice sounding, such as ‘girl-child’, and the nicer they sound, the more useful they are for those seeking to establish their moral authority. To counter the risk of applying labels to exclude and marginalize girls, the category ‘girl’ ought to be conceptualized, deconstructed, and reconstructed from their perspective.

 

How International Women’s Day can exclude girls

This is my first ever blog article. I decided to write it because I wanted to reflect on how International Women’s Day (IWD) celebrations relate to the experiences of young mothers in urban poor locales, such as those that I have continued to engage with as part of my PhD research. In rethinking this year’s IWD theme (‘DigitALL: innovation and technology for gender equality’), several questions came to mind. For example, are girls considered in this debate on gender equality? How relevant is this debate on the role of technology and innovation for young mothers living in poor locales in Uganda where only 9% of the populations aged 15 years and above own a smart phone? Moreover, where only 8% of females use internet? And why should young mothers care about such discussions? How will tech-driven developments benefit them?

Unable to answer these questions, I decided to read up on International Women’s Day. What initially sparked IWD were spontaneous demonstrations to protest inhumane working conditions women faced and to press for improved working conditions. Other issues, such as the right of women to vote, were consequently included, and today IWD marks efforts to enact gender equality more broadly.

What is interesting is that International Women’s Day is assumed to be for everyone, everywhere, and is intended to celebrate and encourage collective action in pursuit of gender equality and extended rights for women. However, discussions about women’s suffrage, gender equality and parity are often far removed from the daily realities of many girls and women, including the young mothers in impoverished areas that I worked with – those who are primarily concerned with meeting their survival needs. In this way, specific categories of girls, or even women, including young mothers, may find themselves being excluded from efforts to enact gender equality and from celebrations of these.

International Women’s Day was initiated by working-class women and while it has since significantly highlighted the plight of women and efforts to close the gender gap, it is at a risk of becoming too universalized and corporatized to include women who face a range of intersecting struggles that stretch beyond voting rights and workplace equity. In celebrating International Women’s Day, it is important to remember those girls and women whose voices still go unheard, who move around in the shadows, and whose intersecting struggles leave them far behind.

Opinions expressed in Bliss posts reflect solely the views of the author of the post in question.

About the author:

Annah Kamusiime is a PhD researcher at the International Institute of Social Studies, Erasmus University Rotterdam (ISS-EUR). Her research interests are in gender and adolescent and youth sexual and reproductive health and rights (SRHR). She is also a Director of Programmes at Nascent Research and Development Organization Uganda.

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Toward ‘fisheries justice’?: the global ‘fisheries crisis’ and how small-scale fishers are fighting back by Elyse Mills

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The global ‘fisheries crisis’—in which fish stocks are depleted, environmental destruction has reached an apex, and small-scale fisheries are disappearing—is causing irreversible damage to both the fisheries sector and communities sustained by fishing activities. Governments implement stricter regulations and resource management strategies in an attempt to solve the crisis, but these approaches typically leave out the perspectives of small-scale fishers. Despite this, fishing communities are constructing innovative ways to make their voices heard and to protect their lives and livelihoods.

Transforming global fisheries

The overlap of the global food crisis (sparked by the 2007-2008 food price spike), and rapid economic growth occurring in the BRICS countries (Brazil, Russia, India, China, and South Africa) has contributed to significantly altering patterns of food production, consumption and trade worldwide. Economic growth has also facilitated changing dietary preferences, contributing to a rising global demand for animal protein. Fish protein has become particularly popular in light of health warnings about industrially farmed animals and eating too much red meat. This has caused fish consumption to double worldwide in the last 50 years.

Rising consumption has intensified pressure on the global fisheries sector—particularly to meet the demands of highly populated countries like China. Even South Africa, which has the smallest economy and population among the BRICS, saw fish consumption increase by 26% between 1999 and 2012. In terms of production, China is by far the world leader, and at its 2012 peak contributed 70% of fish to the global supply. Between 2012 and 2014, it further expanded its capture fishing sector by almost 2 million tonnes and its aquaculture sector by nearly 5 million tonnes. India produced at a similar level, contributing 50% of the global fish supply in 2012—ranking third in global capture fisheries (after China and Peru) and second in aquaculture. South Africa has one of the largest capture fishing sectors in the African continent, contributing approximately US$ 435 million to the national economy in 2012.

Fighting for policy change in South Africa

Capture fishing in South Africa is an important source of livelihoods for many coastal communities, of which a large proportion engages in small-scale fishing. Of the 43,458 commercial fishers and 29,233 subsistence fishers in South Africa, approximately 50,000 are considered small-scale.[i] However, despite comprising almost 62% of the fishing population, the South African Department of Agriculture, Forestry and Fisheries’ national policies have historically not recognised the particular needs of small-scale fishers and the difficulties they are facing, focusing instead on expanding the large-scale industrial fishing industry. This has sparked intense resistance from fishing communities.

After the government adopted its 2005 long-term fisheries policy, leaving small-scale fishers without any access or fishing rights, a group of fishing communities, led by community organisations Masifundise and Coastal Links, took the issue to the South African Equality Court. The Court finally ruled in favour of the development of a new policy. In 2012, the new Policy for the Small-Scale Fisheries Sector in South Africa was completed, introducing new strategies for managing the sector, which aim to secure rights and access for communities by prioritising human rights, gender, and development as key issues. This marked an important victory for South African fishers, demonstrating their capacity for mobilisation and to achieve change. In 2014, Masifundise and Coastal Links also published Small-scale Fisheries Policy: A Handbook for Fishing Communities, providing fishers with accessible information on how the policy could be applied in their daily lives.

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Handline fishers off the coast of Cape Point, South Africa. Photo: Rodger Bosch

Fishers’ participation in governance processes

Considering South Africa’s 2012 policy was developed partly as a response to pressure from fishing communities, it has set an important precedent for future fisheries policies, both nationally and internationally. Masifundise and Coastal Links also played key roles in discussions with the FAO’s Committee on Fisheries (COFI), which led to the publication of the Voluntary Guidelines for Securing Sustainable Small-Scale Fisheries in the context of Food Security and Poverty Eradication (SSF Guidelines) in 2015. These guidelines were the result of a bottom-up participatory process that included 4,000 representatives from small-scale fishing communities, governments, fish workers’ organisations, research institutes, and NGOs.

The development of the SSF Guidelines and South Africa’s national policy signal an important shift in the perception and governance of fisheries sectors. While small-scale fishers have been crucial contributors to the global food system for generations, their rights are only now beginning to be more formally recognised. There appears to be an important connection between this newfound recognition and increasing mobilisation within fishing communities both nationally and around the world.

The rise of a global ‘fisheries justice’ movement?

Increasing mobilisation among fishers, particularly within the last few decades, has demonstrated their commitment to participating in, and shaping, the transformation of the fisheries sector and its socio-political context. Fishers are also joining forces with farmers, pastoralists, rural, and indigenous peoples, as overlapping food and climate crises highlight common struggles between social movements. Their shared commitment to creating a fair food system has contributed both to a transnational convergence of resource justice movements (e.g. agrarian, climate, environmental), as well as the emergence of what I would argue is a global ‘fisheries justice’ movement.

A key actor in this movement is the World Forum of Fisher Peoples (WFFP), of which Masifundise and Coastal Links are active members. Founded in 1997, the WFFP now links 43 national small-scale fishers’ organisations in 40 countries around the world. It focuses on addressing the issues threatening small-scale fisheries (e.g. privatisation, climate change) and advocates for fishers’ human rights and secure livelihoods. The WFFP holds a triennial General Assembly and an annual Coordinating Committee meeting for member organisations to come together, reflect on their goals and actions taken, and develop new strategies for the future.

In an era when power within the food system is increasingly being concentrated in the hands of a few huge corporations, movements of small-scale food producers and their allies offer alternatives based on social justice, sustainable production methods, and protecting the environment that rejuvenate hope for the way forward.

[i] Small-scale fishers refers to: ‘Persons that fish to meet food and basic livelihood needs, or are directly involved in harvesting/processing or marketing fish, traditionally operate on or near shore fishing grounds, predominantly employ traditional low technology or passive fishing gear, usually undertake single day fishing trips, and are engaged in the sale or barter or are involved in commercial activity’. Definition from Department of Agriculture, Forestry and Fisheries (DAFF) (2012), Policy for the Small-Scale Fisheries Sector in South Africa.

Untitled.pngAbout the author:

Elyse Mills is a PhD researcher in the Political Ecology Research Group at the ISS. Her PhD research focuses on the dynamics of fisheries and fishers’ movements in the context of global food and climate politics. She also co-coordinates the Initiatives in Critical Agrarian Studies (ICAS), and is part of the Emancipatory Rural Politics Initiative (ERPI) Secretariat.

 

Deglobalisation Series | Will deglobalisation save the environment? by Sylvanus Kwaku Afesorgbor and Binyam Afewerk Demena

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Anti-globalists and some environmentalists argue that globalisation is harmful to the environment because it leads to an increase in the global demand for and supply of goods and increased energy production. If globalisation is perceived as harmful to the environment, then should we expect that the current deglobalisation trend in the Global North can reverse the harmful impacts that globalisation is seen to have borne on the environment?

 

An important global concern has been to understand the way in which the increasing pace of globalisation affects the environment. Although the literature has been fraught with contrasting results, there are many who strongly believe that increased globalisation has had a deleterious effect on the environment. A large number of environmentalists supporting this view base their argument on the premise that globalisation leads to an increase in the global demand for goods, resulting in increased production that exploits and depletes natural resources and the environment—what is known as the scale effect. On the basis of rising environmental concerns, an important question, then, is whether deglobalisation would produce the opposite effect. Put differently, if globalisation is harmful to the environment, then should we expect deglobalisation to inflict less harm?

Currently, this is an important question to ask considering the heightened anti-globalisation sentiments that have engulfed the Global North. In the recent past, we have not only witnessed Brexit, the election of Trump, and the Belgian opposition of the trade agreement between the EU and Canada, but, more recently, we have seen anti-globalisation sentiments reaching a climax even and especially in the United States (USA) that once was the strongest architect and proponent of globalisation. This has culminated in increased uncertainty and an a near-stalemate for NAFTA, with the US pulling out of Trans Pacific Partnership (TPP) trade agreement, proposing the erection of a wall the border it shares with Mexico, and hiking steel and aluminium tariffs as part of the ongoing trade war with China.

Untitled2The adverse effect of globalisation on the environment is supported by race-to-the-bottom hypothesis. This school supports the hypothesis that increased gains from globalisation is achieved at the expense of the environment by economies more open to global trade adopting looser environmental standards. Those who support this view of the detrimental impact of globalisation on the environment allude to how increasing globalisation creates global competition, resulting in an increase in economic activities that deplete natural resources. An increase in economic activities as a result of the thriving of economies of scale leads to increased emissions of industrial pollutants and to environmental degradation. The pressure on international firms to remain competitive forces them to adopt cost-saving production techniques that can be environmentally harmful.

Lower environmental standards

However, deglobalisation may not necessarily translate into the reduced emission of harmful gases such as CO2, SO2, NO2, but could actually produce the opposite effect. Through the technique effect, we know that globalisation can trigger environmentally friendly technological innovations that could be transferred from countries with strict environmental regulations to pollution havens. With globalisation not only entailing the movement of final goods, but also the transfer of intermediate, capital goods and technologies, multinational corporations with clean state-of-the-art technologies could transfer their green technologies to countries with low environmental standards. It is widely recognised that multinational firms use cleaner types of energy than local firms and thus attain more energy-efficient production processes. Thus, deglobalisation could mean a minimal transfer of these environmental-friendly technologies.

Domestic production means greater pollution

Moreover, the rise of anti-globalisation forces would mean less specialisation in sectors of countries with a comparative advantage. The gains-from-trade hypothesis states that this can result in the loss of the associated gains from trade and specialisation, resulting in the inefficient allocation of resources that would lead to the dissipation of scarce economic and natural resources. If every country has to produce goods to meet its domestic demand, this could result in duplication in the production process, with an associated increase in local emissions. Since some countries have weaker environmental standards, this could possibly worsen overall global emissions. For example, the imposition of economic sanctions on Iran (making Iran less integrated into the world economy) has triggered domestic production (of oil) that has resulted in immense damage to the environment. As a result of import bans, Iran started refining its own crude oil that contains ten times the level of pollutants of the oil it formerly imported.

The rise of ‘eco’ products

The notion of globalisation also has been used to create public awareness regarding labour and environmental standards through international campaigns culminating in the Fairtrade and Eco labellings, for example. The success of these public awareness programmes is based on the different preferences of consumers. Producers are able to increase their market access by producing eco-friendly products. Without international trade, consumers would have been presented with limited choices, and may have been forced to only purchase the domestic goods that may have been produced under loose environmental standards. Thus, globalisation can expand the choice of consumers, enabling them to select environmentally friendly products.

Indirect conservation mechanisms

Globalisation achieved through multilateral negotiations on the platform WTO has also demonstrated that although environment protection is not the WTO’s core mandate, it has indirectly stimulated enthusiasm within its member countries for sustainable development and environmentally friendly trade policies. The green provisions of the WTO provide general exceptions that allow countries to protect human, animal or plant life and conserve their exhaustible natural resources.

Apart from the WTO, regional trade agreements (RTAs) are another appendage of globalisation that promote environmentally sustainable policies. As countries seek to join RTAs, they are made to simultaneously embrace environmental co-operation agreements. Many countries (such as Canada and member states of the EU) have developed national policies whereby conducting environmental impact assessments before signing trade agreements is mandatory. Thus, trade agreements can only be signed when they are compatible with the environmental standards of individual EU member states. This thus compels partners to trade agreements to adhere to environmental provisions contained in the agreements.

Leaders and followers

We have seen over the years how countries such as China that used to be pollution havens have had tremendous gains in reducing their emissions, especially after becoming more integrated into the world economy. Because of globalisation and the incentives to increase its global market access for its products, China has moved away from its image as a top polluting country in the world to a global leader spearheading the fight against pollution. In 2017, China closed down tens of thousands of factories that were not complying with its environmental standards.

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Beijing workers’ stadium on smoggy and clear days from https://www.huffingtonpost.ca/entry/china-air-pollution-2014_us_568e592ce4b0a2b6fb6ecb73

In contrast, we have seen a country like the US that has been at the forefront of fighting against environmental damage slowly drifting away from this fight because of its embracing the anti-globalisation sentiments of the current president Donald Trump. Through its America First Energy Plan, the Trump administration has outlined its preference for polluting industries, the use of fossil fuels, and revival of the coal industry. This points to the fact that countries seeking self-sufficiency or expressing anti-globalisation sentiments may drift away from sustainable development practices towards industrial policies that may be injurious to the environment.

Restricting international trade may have a negative impact on the environment. Deglobalisation would isolate countries, making them less accountable toward other countries for protecting the environment. The gains associated with globalisation could be used as an effective bargaining strategy or as an incentive to demand environmental accountability from countries that want to benefit from global trading systems.

About the authors:

csm_SKA_Picture_Academic_4c02c69704Sylvanus Kwaku Afesorgbor is Assistant Professor at the Department of Food, Agricultural and Resource Economics (FARE), University of Guelph, Ontario, Canada. His research and teaching experiences are in the areas of International Political Economy, Globalisation and Development, Impact Evaluation, Applied Econometrics, and Food and Development.

downloadBinyam Afewerk Demena is a Teaching and Research Fellow at the ISS. His research interests are in the broad area of applied empirical research with a particular focus on applied micro-econometrics in development, international and fishery economics. In his PhD, he examined the impact of transmission channels of intra-industry productivity using applied micro-econometrics, meta-analysis, multi-country micro-panel data, and applied field research via on-site visits.

 

Deglobalisation Series | (de)globalisation and the fear of trade by Ana Cristina Canales Gomez

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While the consequences of globalisation over health and nutrition can be contradictory, trade openness can be a relevant policy for reducing food insecurity. This relatively inexpensive action, when compared to technology or research-based programmes, can increase the availability of nutritional foods, increase higher nutritional variety in diets, and can stabilise the food supply, reducing food shortages.

“One of the biggest ideas to hit the political world in recent years is that politics is increasingly defined by the division between open and closed, rather than left and right” (The Economist, March 24, 2018)

The recent trend of pushing against globalisation is based on different sources of information that varies from science-based evidence to ideas that trade and global agreements form part of a mastermind plan of invisible benefactors of the globalisation system. This phenomenon of deglobalisation has occurred before, but a major difference can be seen between the current and previous manifestations: in the 1930s, deglobalisation was pushed by governments, while the current expression of deglobalisation is pushed by the general public through social media.

When it comes to health and nutrition, the matter of globalisation and its impacts can be somewhat contradictory, and as with most economic matters, the perception of globalisation will depend on the viewer’s position: if you are in the LDCs where malnutrition is a leading cause of mortality, hinders development and entails national losses of around 6% of GDP[1], you might see globalisation as a beacon that could signal the introduction of greater nutritional diversity to local diets. If, on the other hand, you live in countries such as Chile or Mexico where undernourishment is no longer the main issue and the country now faces a transitional economic phase wherein obesity becomes a cause of concern, the increased inflow of foods from countries such as the United States might be viewed in a more negative light—as an influx of unhealthy types of food that contribute to obesity (Giuntella 2017).

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Graph 1 Changes in trade (% of GDP) and the prevalence of stunting in children under 5 years of age, world level. Source: author’s elaboration using STATA and the WDI (Last updated January 25, 2018).

From a descriptive perspective, during the last 30 years, and particularly after the Marrakech negotiations that led to the formation of the World Trade Organization (WTO) and its agreements, there has been an increase in trade openness and a reduction in the prevalence of stunting (PAHO 2017), even though hunger is still the leading cause of death and primary contributor to disease worldwide (Pongou et al. 2006).

We can assess the impact of trade openness using the Depth of the Food Deficit (DFD), an outcome indicator that measures inadequate access to food (Reddy et al. 2016, Santeramo 2015) by determining the amount of calories needed to lift the undernourished out of this position, ceteris paribus (Reddy et al. 2016, World Bank Group. 2017, Dithmer and Abdulai 2017).

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Table 1: Effect of the import and export value indexes (2000=100) over the depth of the food Deficit (kcal per person per day), world level.

Table 1 shows the effect of Export and Import Value Indexes, included in logarithmic form, over the DFD. There is overall a strong and significant relation between both values and the indicator: an increase of one percentage point of the Import Value Indexes reduces the Depth of the Food Deficit in a range of 21 to 37 kilocalories, such change being consistent to the inclusion of all controls. Hence, a reduction of the DFD responding to an increase in both exported and imported values speaks of narrowing gaps between current nutritional status and the average dietary energy requirements of the population, and can contribute to SDG2—Zero Hunger.

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Table 2: Effect of import and export Values (2000=100) over depth of the food deficit (kcal per person per day) in Latin American countries (excluding Haiti, Cuba and the Small Caribbean States).

The same regression can be run for the Latin American countries, including a variable constructed by the author measuring the number of food security programmes per country per year. The impact of trade openness over DFD is still strong and relevant in magnitude, and there is a linear albeit insignificant relation where programmes reduce the prevalence of undernutrition. When the quadratic variable is applied it hints—the coefficients are not significant—that such an effect only goes so far, and that, after a breaking point, these programmes show detrimental results.

Considering all of the above, the evidence shows that trade openness is in fact a relevant policy when it comes to reducing food insecurity, increasing social wellbeing and leading to socioeconomic progress. Furthermore, it would seem that trade openness is a more effective tool than the implementation of specific programmes that attempt to target food insecurity that many times end up doing more harm than good. This could be explained by the fact that there is a trend towards the indiscriminate adoption of programmes, both local and foreign. Additionally, more programmes usually signal the lack of effective stakeholder coordination, the lack of continuity in governmental strategies, and the inefficient expenditure of available resources.

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Table 3: Effect of export and import Values (2000=100) over obesity prevalence for children under 5 years of age, world level.

When it comes to obesity, our research shows inconclusive results: there is a significant albeit small effect of trade openness—both export and import values—on the prevalence of obesity, but this effect fades when controls are included in the models. This can be due to the fact that obesity is a more recent phenomenon and besides integration of economies into global markets responds to many factors, such as economic growth, urbanisation trends, and the rise of the middle class (PAHO 2017).

Conclusion

While the consequences of globalisation over health and nutrition can be contradictory, it is an effective tool for the reduction of hunger, currently the leading cause of death in the world. This relatively inexpensive action, when compared to technology or research-based programmes, can increase the availability of nutritional foods, increase higher nutritional variety in diets, and can stabilise the food supply, reducing shortages in times of dearth. Overall, opening up to trade, at least from the health and nutrition perspective, seems to be a policy worth trying, but there is only so much that trade can do without a strong institutional background.

[1] Which is the case for Central America and the Dominican Republic according to the CEPAL (as cited by Jara Navarro (2008: 9)

[2] According to the WHO, stunting is defined as the impaired growth and development that children experience from poor nutrition, repeated infection, and inadequate psychosocial stimulation. Children are defined as stunted if their height-for-age ratio is more than two standard deviations below the WHO Child Growth Standards median.

References
Dithmer, J. and A. Abdulai (2017) ‘Does Trade Openness Contribute to Food Security? A Dynamic Panel Analysis’, Food Policy 69: 218-230.
Giuntella, O., M. Rieger and L. Rotunno (2017) ‘Weight Gains from Trade in Foods: Evidence from Mexico’, University of Pittsburgh, Kenneth P. Dietrich School of Arts and Sciences. Working Paper Series 17/010 Weight gains from trade in foods: Evidence from Mexico. 17/010.
Jara Navarro, M.I. (2008) ‘Hambre, Desnutrición y Anemia: Una Grave Situación De Salud Pública’, Revista Gerencia y Políticas de Salud 7(15): 7-10.
PAHO (Last updated 2017) ‘Sobrepeso Afecta a Casi La Mitad De La Población De Todos Los Países De América Latina y El Caribe Salvo Por Haití’ (a webpage of PAHO/WHO). Accessed April 12 2017 <http://www.paho.org/chi/index.php?option=com_content&view=article&id=856:sobrepeso-afecta-a-casi-la-mitad-de-la-poblacion-de-todos-los-paises-de-america-latina-y-el-caribe-salvo-por-haiti&Itemid=1005&gt;.
Pongou, R., J.A. Salomon and M. Ezzati (2006) ‘Health Impacts of Macroeconomic Crises and Policies: Determinants of Variation in Childhood Malnutrition Trends in Cameroon’, International journal of epidemiology 35(3): 648-656.
Reddy, A.A., C.R. Rani, T. Cadman, S.N. Kumar and A.N. Reddy (2016) ‘Towards Sustainable Indicators of Food and Nutritional Outcomes in India’, World Journal of Science, Technology and Sustainable Development 13(2): 128-142.
Santeramo, F.G. (2015) ‘On the Composite Indicators for Food Security: Decisions Matter!’, Food Reviews International 31(1): 63.
The Economist (2018) ‘Bagehot: Rethinking Open v Closed’, The Economist March 24th-30th 2018 9084: 33.
WHO (Last updated 2017) ‘Noncommunicable Diseases’ (a webpage of WHO Media Centre). Accessed April 12 2018 <http://www.who.int/mediacentre/factsheets/fs355/en/&gt;.
Winters, L.A. (2004) ‘Trade Liberalisation and Economic Performance: An Overview’, The Economic Journal 114(493).
World Bank (Last updated 2018) ‘World Development Indicators’ (a webpage of The World Bank). Accessed March 1 2018 <http://databank.worldbank.org/data/reports.aspx?source=world-development-indicators#&gt;.

0894f1c-2.jpgAbout the author:

Ana Cristina Canales Gómez is a veterinarian at the Universidad de Chile who holds a Masters degree in Public Policy from the same institution and a Masters degree in Development Studies from the ISS. Currently, she works as a consultant for Food & Foodstuffs Trade and Nutrition Policies in the Food and Agriculture Organization (FAO).

 

Deglobalisation Series | Financial deglobalisation: a North-South divide? by Haroldo Montagu

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The Financial Crisis of 2008/09 led to a structural break in financial globalisation, setting cross-border capital flows back to the average of the 1990s. Do differences between cross-border financial flows of the Global North and Global South disqualify the financial slowdown as deglobalisation? Will the 21st Century be a deglobalised century, or are we just witnessing a new (and maybe better) face of financial globalisation?

While it is clear that trade flows collapsed and slowed down after the global financial crisis of 2008/2009 and that deglobalisation in terms of international trade has occurred ever since, the picture is less clear for capital flows. Forbes argues that financial deglobalisation is visible in the sharp and sustained decline in cross-border financial flows associated with the recent global financial crisis, with no signs of recovery. Leading think tanks and international organisations, such as the McKinsey Global Institute (MGI), the Bank of International Settlements (BIS), and the International Monetary Fund (IMF), have, however, argued that financial deglobalisation is not a reality because the decrease of financial flows is not a broad-based and sustained phenomenon. Closer scrutiny of data related to this can help us to better understand whether financial deglobalisation is happening or not.

Graph 1: Cross-border financial flows (share of world GDP) reached a peak before the crisis and have since been at a lower level, with indications that they are now flattening out
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Source: own elaboration based on IFS and WEO databases (2018) (see IMF data)

As illustrated in Graph 1, the financial crisis created a structural break in the level and pace of financial globalisation. In 2007, international financial flows peaked at more than 50% of world GDP, but then global cross-border flows fell significantly in 2008 and after some recovery levelled out at around 15% of world GDP (slightly above the average for the 1990s).

G7 versus BRICS

This global average, however, does not in itself reflect different experiences in the Global North and Global South. So, let’s take on one side the advanced economies gathered in the G7 (Canada, France, Germany, Italy, Japan, UK, US) representing the Global North and, on the other, emerging economies labelled as BRICS (Brazil, Russia, India, China and South Africa), as a Global South sample, and regard their own experiences to move beyond the aggregate picture that might not reveal differences in the extent of deglobalisation. Graph 2, like Graph 1, shows cross-border financial flows, but rather than focusing on global GDP displays the regional GDPs for the Global North (G7) and the Global South (BRICS).

Graph 2: Different experiences in G7 and BRICS (cross-border financial flows as a share of regional GDPs)
Financial deglobalisation(?)

Graph 2
Source: own elaboration based on IFS and WEO databases (2018) (see IMF data)

The graph clearly shows that the G7 grouping reached a financial peak in 2007, followed by a sharp decline in 2008/09 and poor recovery following the crisis. The graph, however, paints a very different picture for the BRICS economies. A number of factors are noteworthy in determining whether financial globalisation is also taking place in the BRICS grouping. First, the decrease in financial flows after the crisis, although important, is not as significant for the BRICS as for G7 countries. While the decline of the advanced economies was about 40 percentage points during 2008/09, amongst the BRICS economies the fall was only about 8 percentage points.

Second, in the BRICS grouping the financial flows recovery (both in level and in terms of speed) was quite remarkable. As a consequence, in 2010 the BRICS had recovered to a level well above the level in the 1990s, while the share of the G7 countries remained around 30 percentage points below the pre-crisis peak. These figures clearly show that nowadays the BRICS countries hold a similar share of financial integration (relative to their own GDPs) as the G7 countries(!). A third point worth mentioning is that BRICS’s financial flows, while insignificant in the 1990s and early 2000s, increased, on average, to about 2% of world GDP following the crisis (2010-2016). Again, this means that the gap between advanced and emerging economies is shrinking.

How global is financial deglobalisation?

The key issue is whether these dissimilarities would disqualify the labelling of the financial slowdown after the crisis as deglobalisation that after all is understood to be a widespread phenomenon. While G7 countries can’t recover financial momentum, the BRICS’s financial decline was neither sharp nor sustained. In short, there does not (yet) seem to be enough evidence to call it a collapse justifying the deglobalisation denomination.

The McKinsey Global Institute also points out here to other differences between advanced and developing countries. They argue that while cross-border capital flows for the whole world remain 60% below their peak finance momentum, in developing countries capital flows have rebounded. By estimating shares in constant terms, different than the current ones I showed, MGI arrived at the same conclusion. In addition, they emphasise the increase in South-South financial flows linked to foreign direct investment (FDI).

In the same vein the BIS argues here that even in the advanced economies, deglobalisation is restricted only to European countries. If focusing only on banking flows, consolidated by bank nationality—and not by bank location as the IMF usually presents—a broad-based deglobalisation trend is not evident. Rather, we are witnessing a European financial retreat.

Resetting financial globalisation

What is this diverse financial flows behaviour telling us? According to Mallaby, after the crisis financial flows show a “healthy correction”, defining the years leading up to the financial peak as an “aberration”. Accepting the “healthy correction” hypothesis would lead us to pose an alternative characterisation to the deglobalisation of financial markets. In this sense, words like “retreat”, “retrenchment” and even or “reverse” would be more appropriate for depicting the phenomenon. Moreover, can we say that post-crisis financial globalisation is healthier than the one registered before the crisis? Maybe it is not about lower shares, but better ones, leading to sounder financial markets where the financial globalisation reach is set by policymakers and regulators and not by an indomitable financial speculation, heading, as usual, to a crisis.

Whether is the rising regulation, the macro-prudential policies or just plain and simple risk aversion after the aberration (or a mix of all of them), financial globalisation’s newest phase looks, in general, the least volatile phase that might be least prone to crisis. However, is this new shape of globalisation good news? As usual, it depends. The Global North cannot afford to cause another boom-and-bust cycle whose impacts and costs are, indeed, globalised while their benefits are not. On the other hand, Global South recovery is not necessarily good news either. It is not clear that financial flows linked to ODA, debt, remittances or even FDI alone can drive economic growth or development.

Hence, cautionary measures should be taken (or reinforced) by governments to allocate foreign capital where is needed and do not validate unregulated financial speculation, especially the one triggered from the Global North. Despite their heterogeneity and criticism, the UN Sustainable Development Goals (SDGs) might be a good starting point regarding what is required to finance with foreign capital and what it’s not. Additionally, countries of the Global South must stand up and speak out, jointly, in international fora, warning about the dangers of financial aberrations. This should be presented as a global problem (even when it originated in the Global North) rather than a regional phenomenon or as a once-in-a-lifetime kind of thing, which it may not be.

Will the 21st Century be a deglobalised century, or are we just witnessing a new (and maybe better) face of financial globalisation? Only time and, hopefully, financial markets regulators, will tell.

Also see: Is anti-globalisation only a preoccupation in the Global North? by Rory Horner, Seth Schindler, Daniel Haberly and Yuko Aoyama

Untitled.pngAbout the author:

Haroldo Montagu is a recent graduate of the ISS. Before studying at ISS, the author was appointed as National Director of Development Strategies and Macroeconomic Policy at the Ministry of Economy and Public Finance of Argentina. He also worked as a consultant for the Economic Commission for Latin America and the Caribbean. He teaches topics in International Economics and Economic Development at university level in Argentina.

 

 

Deglobalisation Series | China: ‘restarting’ globalisation? by Chenmei Li

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After benefiting from international trade and investment for the past 30 years, China’s global position is starting to change. This is perhaps most evident when regarding its position at the centre of an ongoing ‘trade war’ with the United States. Given its role as leader in international trade, will China be able to ‘restart’ globalisation and offer an alternative to globalisation and deglobalisation as defined by the West?

As developed countries appear to step back from globalisation, China senses an opportunity to step forward and set new rules for globalisation. A major component of the Chinese strategy to lead changes in how globalisation is thought of and practiced is the One Belt and One Road Initiative (OBOR) of the Chinese government. Aimed at improving infrastructure and connectivity between China and the world, this initiative comprises more than physical connections. The Chinese government argues that this initiative includes not just economic, but also socio-cultural linkages, ultimately leading to mutual benefits for all countries involved. The OBOR defines China’s idea of globalisation in a new era in which emerging economies backed by rising economic power and strong alliances are seeking greater influence on global issues.

2000px-One-belt-one-road.svg.png
Figure 1. Map of China’s One Belt One Road Initiative, with China in red and the land (black) and sea (blue) routes indicated. Source: https://en.wikipedia.org/wiki/One_Belt_One_Road_Initiative

China’s push for globalisation has evoked mixed reactions across the world, and Beijing has had to deal with multiple obstructions to its vision. Moreover, logistical and bureaucratic issues are plaguing countries participating in the OBOR. For instance, although China has signed bilateral cooperation agreements with Pakistan, Hungary, Mongolia, Russia, Tajikistan, and Turkey, with a number of projects planned under those agreements, the proposed projects have not been implemented. Most such projects are infrastructure-related, for example a proposed train connection between eastern China and Iran, which eventually may be expanded to Europe. Powerful Western economies and neighbouring Asian giants have remained cautious in their assessments and acceptance of the initiative.

Sustaining the benefits of globalisation

An important motivation behind the OBOR is the endeavour to continue to benefit from globalisation. Since 1979, China has implemented an Opening and Reforming Strategy. However, its export in percentage of GDP (trade openness) in 1980 was only 5.9% and outward Foreign Direct Investment (FDI) was 1.7 billion US dollars. Only after the 1990s China’s globalisation process really began. Joining the WTO in 2001 pushed its trade openness to the highest point—higher than the world average and the levels of the UK and US (Figure 2).

openness
Figure 2. Trade openness from 1960 to 2016 for four of the world’s largest economies, with the world average also indicated. Source: World Development Indicators (2018).

China is said to have been the largest beneficiary of globalisation until the economic crisis hit in 2008. After the economic crisis, the international market became weak and the Chinese economy could no longer count on export as its most powerful economic ‘carrier’ (besides investment and consumption). Immediately following the crisis, the Chinese government injected 4 trillion renminbi (RMB) into the economy and boosted short-term investment and consumption. Its long-term plan, which was not clear until 2012, is to further stimulate trade openness and integration into the world economy. China thus seeks to leverage the global market and resources to boost its economic growth.

At the helm of rebuilding globalisation efforts?

China does not only want to continue to benefit from globalisation, but also wants to lead the rebuilding of a global system where it could assume a leading role. The current deglobalisation phenomenon does not mean that the general globalisation trend will cease, because the core driver of globalisation is technology, which is advancing faster than ever. However, it does suggest a splintering (if not collapse) of the current globalisation system created after World War II and shaped to its current state largely by developed economies.

Trumpism and Brexitism are both symbols of the deglobalisation phenomenon but are not evidence that the traditional leaders of globalisation are deglobalising their economies. Instead, such symbols show the recognition of the need for a new globalisation system by both ‘traditional’ world leaders like the US and UK as well as emerging powers who were largely excluded from the last global rulemaking process and now hold a share of the world GDP so significant that they cannot be ruled out again.

However, globalisation in China has always been selective, well-managed, and restricted mainly to economic and trade-related activities. Besides its achievement regarding global trade, China shows little achievement or/and willingness to be globalised in terms of, for example, finance, human resources, and culture. The exchange rate is under careful control. English education in China is mandatory since middle school, but the real usage of English is still quite limited. China is known to be the most difficult country for foreigners to attain residence permits, and to date it blocks direct access to the global internet. These are all signs that Beijing is not too eager to participate in all forms of globalisation.

China needs to tread carefully

And thus its attitude may jeopardise China’s idea of globalisation through the OBOR initiative. The explanation often used by Chinese government for the selectivity related to the initiative is its desire to minimise the negative effect of Western-Defined Globalisation and to respect China’s special country situation. However, China’s attitude towards the OBOR must be open-minded and holistic, both tolerable of and acceptable to a wide range of ideologies.

The Chinese government seems to realise that and is promoting the OBOR as ‘the most inclusive globalisation system’. Formally, the OBOR emphasises five key areas of cooperation, including economic, financial and social exchanges, and the private sector is encouraged and expected to be the main driver of the initiative. Unfortunately, the current situation suggests that OBOR has been largely driven by state-owned enterprises and government-level trade agreements, and is limited to global trade. The areas that are not engaged by the plan, such as culture, education, data sharing and immigration, are likely to hinder China’s efforts towards globalisation, especially in a digital world where technology is developed at such a high speed.

In conclusion, China will continue to seek leadership in restoring the globalisation system, with the OBOR initiative as its core measure. However, both traditional leaders and other emerging powers still have a say in how and whether the globalisation system is re-established. Consensus may not have been reached between countries, but the globalisation trend is likely to continue—and at a faster pace due to new technologies. If China truly wants to become a major global leader in the quest to ‘restart’ globalisation, private sector involvement in areas other than trade need to be encouraged through a more open-minded attitude.

Also see: Deglobalisation 2.0: Trump and Brexit are but symptoms by Peter. A.G. van Bergeijk and Challenges to the liberal peace by Syed Mansoob Murshed

untitled.pngAbout the author:

Chenmei Li is a Project Analyst at Institute of New Structural Economics, Peking University—one of the top 25 think tanks in China. She is working on economic transformation of developing countries (especially in Africa) and China’s engagement with LDCs. She received a Master’s degree from the ISS in 2016.

 

 

Deglobalisation Series | Challenges to the liberal peace by Syed Mansoob Murshed

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We may have reached a stage where economic interactions have become so internationalised that further increases in globalisation cannot deliver greater prospects of peace.[1] But the logic of the capitalist peace still holds water; the intricate nature of the economic interdependence between advanced market economies almost entirely rules out war, but other hostile attitudes can still persist, and even grow.  

Liberal peace theories posit that peace among nations is not a result of a balance of power, but rests on the pacific nature of commonly held values, economic interdependence, and mutual membership of international organisations. Ideal theories of the liberal peace can be traced back to the work of Immanuel Kant, who in his essay on the Perpetual Peace[2] argued that although war is the natural state of man, peace could be established through deliberate design. This requires the adoption of a republican constitution simultaneously by all nations, which inter alia would check the war-like tendencies of monarchs and the citizenry; the cosmopolitanism that would emerge among the comity of nations would preclude war. The European Union is the most obvious, albeit imperfect, example.

Mirroring Kant’s thoughts is the contemporary philosopher John Rawl’s [3] notion of peace between liberal societies, which he refers to as peoples and not states. He speaks of well-ordered peoples. These are mainly constitutional liberal democracies, which arrive at such a polity based on an idea of public reason. In a well-ordered society, based on public reason, human rights are respected, and the distribution of primary goods (a decent living standard, dignity, respect and the ability to participate) for each citizen’s functioning is acceptably arranged.

Another version of the liberal peace theory based on economic interdependence is the ‘capitalist’ peace notion.[4] The intensity of international trade in an economy is the least important feature in the peace engendered by capitalism. The nature of advanced capitalism makes territorial disputes, which are mainly contests over resources, less likely, as the market mechanism allows easier access to resources. The nature of production makes the output of more sophisticated goods and services increasingly reliant on “ideas” that are research and development intensive, and the various stages of production occur across national boundaries. Moreover, the disruption to integrated financial markets makes war less likely between countries caught up in that web of inter-dependence. It is also argued that common foreign policy goals reflected in the membership of international treaty organisations (such as NATO and the European Union) also produce peace.

The chances of the well-ordered, tolerant societies envisaged by Rawls living in peace within themselves and with one another have greatly diminished with the recent rise in inequality, the growing wealth and income share of the richest 1-10% of the population, and the rise in varieties of populist politics. Also, the quality of Kant’s foedus pacificum has been dealt a severe blow by nations such as the UK choosing to leave the European Union, adversely affecting the utilisation of soft power via common membership of international organisations.

We also may have come to a stage where economic interactions such as the exchange of goods, provision of services and the movement of finance have become so internationalised that further increases in globalisation cannot deliver greater prospects of peace.[5] But the logic of the capitalist peace still holds water; the intricate nature of the economic interdependence between advanced market economies almost entirely rules out war, but other hostile attitudes can still persist, and even grow, given recent developments. This includes the rise in populist politics.

The rise of populist politics

The growth in inequality, but more especially the creeping rise in the social mobility inhibiting inequality of opportunity, has spawned the illiberal backlash manifesting itself in the rise in mainly right wing populist politics. A large segment of immiserated voters vote for populists knowing that, once elected, the populist politician is unlikely to increase their economic welfare, as long as they create discomfiture for certain establishment circles, vis-à-vis whom these voters see themselves as relatively deprived. Immigrants and immigration is scapegoated and made responsible for all economic disadvantage and social evils following the simplistic and simple-minded message of right-wing demagogues. It has to be said that left-wing populism, too, has emerged in many societies, mainly among educated millenarians whose economic prospects are often bleaker than those of their parents, and in regions (such as Latin America) with a strong Peronist tradition.

By contrast, during the golden age, which lasted for a little over a quarter of a century after World War II, no particular group in society was disadvantaged by economic growth and the advance of capitalism. The elites appeared to internalise the interests of the median and below-median income groups in society. Social mobility was palpably present, and social protection cushioned households against systemic and idiosyncratic economic shocks. The growth in inequality linked to globalisation and labour-saving technological progress since the early 1980s has disadvantaged vast swathes of the population: it first pauperised the former manufacturing production worker through either job offshore relocation or stagnating real wages, and latterly it is emasculating even median service sector occupations. At the same time the income and wealth share of the top 1-10% of the population grows at an accelerating pace, faster than the rise in national income.[6]

In developing countries there has been a growth in autocratic tendencies, the liberal half of a liberal democracy, even when the other part of democracy, the electoral process, is broadly respected. The use of plebiscites by strong men to garner greater power has been a frequently used tool. There is even talk of autocratic rulers delivering development and economic growth and autocratic tendencies may be greater in nations that have achieved economic structural transformation. But the logic of the “modernisation”[7] hypothesis that argues that democracy is demanded by society as it becomes affluent may still ring true, even if the process is non-linear, and other complex factors need to be taken into account.

A hyper-globalisation trilemma?

Faced with these challenges, we need to abandon our “Panglossian” faith in the ability of markets to always do good. The rules of globalisation and capitalism only serve elites who are owners of internationally mobile skills and wealth. There may be a hyper-globalisation trilemma[8], whereby the simultaneous achievement of national sovereignty, democracy and hyper-globalisation is impossible. It is worth reiterating that hyper-globalisation refers to a situation where for the collective the pains from increased globalisation in terms of adverse distributional consequences outweigh the gains in terms of enhanced income.

Earlier advances of globalisation was made relatively more acceptable in Europe compared to the United States, given the greater prevalence of social protection in the continent. Gradually, after 1980, and especially since the dawn of the new millennium, more and more groups have been disadvantaged by globalisation, and the politics of austerity has diminished social protection, fraying pre-existing domestic social contracts. Thus, many advocate a more limited globalisation, akin to the halcyon days of the golden age, also known as the Bretton Woods era (1945-73), whose hallmark was that the demands of globalisation never exercised veto powers on the domestic social contract.

A retreat from hyper-globalisation is desirable, but not through channels that diminish international cooperation and partnership, like Brexit and President Trump’s protectionist sabre rattling that undermine agreements like NAFTA. What is needed is internationally coordinated checks on hyper-globalisation and agreements on certain wealth taxes on the richest individuals, which is needed to address the alarming rise in wealth inequality given the fact that social protection can only have a palliative, and not curative, impact on these stupendous inequalities.

References:
[1] Rodrik, Dani (2017) Straight Talk on Trade: Ideas for a Sane World Economy, Princeton: University Press.
[2] Kant, Immanuel (1795) Perpetual Peace and Other Essays on Politics, History and Morals, reprinted 1983. Indianapolis: Hackett Publishing.
[3] Rawls, John (1999) The Law of Peoples, Cambridge, MA: Harvard University Press.
[4] Gartzke, Erik (2007) ‘The Capitalist Peace’, American Journal of Political Science 51(1): 166-191.
[5] Rodrik, Dani (2017) Straight Talk on Trade: Ideas for a Sane World Economy, Princeton: University Press.
[6] Piketty, Thomas (2014) Capital in the Twenty-first Century, Cambridge, Massachusetts: Harvard University Press.
[7] Lipset, Seymour (1960) Political Man: The Social Bases of Politics. New York: Doubleday.
[8] Argued by Dani Rodrik; see, for example, Rodrik (2017), op. cit.

Also see: Backtracking from globalisation by Evan Hillebrand

csm_6ab8a5ef34f1a5efe8b07dff07d52162-mansoob-murshed_0833a7fcf4About the author:

Syed Mansoob Murshed is Professor of the Economics of Peace and Conflict at the International Institute of Social Studies (ISS), Erasmus University Rotterdam in the Netherlands. His research interests are in the economics of conflict, resource abundance, aid conditionality, political economy, macroeconomics and international economics.

 

 

Deglobalisation Series | Backtracking from globalisation by Evan Hillebrand

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While globalisation still enjoys strong support in the Global South, major economies in the Global North now seem less enthusiastic about its purported benefits. This article explores how the United States through its previous policies came to backtrack from globalisation, showing that it is an altogether unsurprising development.

From the perspective of the United States (US), embodied in US president Donald Trump’s recent discourses, the liberal international trading system faces at least three major economic and socio-political challenges going forward: (1) income redistribution, (2) the rise of Asia and a potential shift in comparative advantage, and (3) the rise of China and the national security argument. Given the growing domestic unease with free trade and the fact that these exacerbating issues are worsening, I suggest that US policies will become less supportive of globalisation.

US withdrawal: surprising or expected?

In our 2011 article, “Backtracking from Globalization” (1), my coauthors and I discussed the declining support for globalisation in the United States and elsewhere. Since then the trend has gotten worse.

But why shouldn’t it? The US, after all, has only had a liberal trade policy for 60 or so years. In its early years, US policy focused on high tariffs, large subsidies to key industries, and infrastructure investment designed to create an industrial economy for the sake of military and economic power (sounds not too dissimilar to China today). The US moved to a freer-trade stance when the US was economically dominant and an expansion of global markets seemed as if it would be economically beneficial.

The US free trade strategy was also based on political theories and grand strategy. After World War II, trade expansion was seen as a good way to bolster Europe economically, tie it to the West, and strengthen the West against the Soviet Union. The US spurred the creation of the GATT/WTO in an effort to bring all countries into a democratic rule-based system under the assumption that trade would help all countries prosper under US leadership. Since 1980 or so, the US has tried to lure China into the world market system to foster interdependence and peace. In many respects, that policy can be considered a great success—ushering in a vast improvement in the material standard of living almost everywhere and many decades of great-power peace. China also did turn away from its Maoist phase of development.

 Ebbing enthusiasm for globalisation

Support for globalisation, however, is clearly headed in a negative direction and the ebbing of enthusiasm has been particularly dramatic in the United States. Recent polling data from the Pew Foundation and the Council on Foreign Relations (2) show that there is still support for international trade, but a majority worry that trade generates labor market costs in terms of job destruction and lower wages. This worry helped elect the current US president and his administration talks more about fair trade than free trade: ‘Nothing about the theory of comparative advantage would lend itself to a defense of a status quo that imposes higher barriers to exports on American producers than on foreign producers’ (Economic Report of the President 2018: 219) (3).

It is important to understand that it is not ignorance that has led US policy in this direction.

Many voters were lured to Donald Trump’s “America First” pitch because of a perception that wages were stagnant and communities were hurt because of globalisation. In reality it is more than just a hunch: income distribution in America has worsened and academic research by Paul Krugman (4) and others attributes some of that worsening to trade, although the magnitude of trade’s contribution is (and always will be) in dispute.

Support for globalisation has to some extent rested on the theory of comparative advantage, but that theory has never been the “slam dunk” argument that enthusiasts have made it out to be. It depends on so many assumptions that do not fit the current world economy, so the theory should only be relied upon as a general principle, not the decider of every policy dispute. Paul Samuelson (5) claimed in 1972 that the aggregate gains from trade are not necessarily positive. He expanded on this idea in his (2004) paper, ‘Where Ricardo and Mill Rebut and Confirm Arguments of Mainstream Economists Supporting Globalization’, saying that growth in the rest of the world can hurt a country if it takes place in sectors that compete with its native exports—where it has comparative advantage.

The rise of China

Relative, and even absolute, per capita GDP can fall in such a situation (6). Whether China’s rise can actually diminish the US is not clear, but the current Chinese government continues to employ active trade policies to push its industries up the value chain, aiming explicitly at sectors that have been the mainstay of US industrial pre-eminence. Samuelson says that ‘economic history is replete with examples like this, first insidiously, and later decisively’, pointing explicitly to British manufacturing being overtaken by US industry after 1850.

In addition to the economic threat posed by China, the US government has long worried about the security threat posed by China’s rise. The US-China Economic and Security Review Commission is an organisation chartered and funded by the US Congress and dedicated to the proposition that China poses a multifaceted threat to the US. It yearly issues a massive report that cites declines in the US defense industrial base, insecurity of defense supply lines, financial threats, Chinese ownership of critical US facilities, cyber threats, and other problems—all related to China. In the most recent report (7), it lists 26 recommendations for congressional action, many of which would amount to new trade restrictions.

Trade policies, while often rooted in interest groups scrambling for distributional gains, are also related to national economic and security concerns. In the past, pragmatic national interests have pushed trade policy in varying directions. There is no reason now to believe that the US is giving up on international trade, but there is every reason to believe that for a variety of national interests it will be much less enthusiastic about globalisation in the future.

References:
(1) Hillebrand, E.E., J. Lewer and J. Zagardo (2011) ‘Backtracking from Globalization’, Global Economy Journal 10(4).
(2) Poushter (2016) American Public, Foreign Policy Experts Sharply Disagree over Involvement in Global Economy. Pew Research Center, http://www.pewresearch.org/author/jpoushter.
(3) Council of Economic Advisors (2018) Economic Report of the President. Washington, D.C. https://www.whitehouse.gov/wp-content/uploads/2018/02/ERP_2018_Final-FINAL.pdf
(4) Krugman, P.R. (2008) ‘Trade and Wages, Reconsidered’, Proceedings of the Brookings Panel on Economic Activity. Spring conference. Available at: (http://www.princeton.edu/~pkrugman/pk-bpea-draft.pdf).
(5) Samuelson, P.A. (1972) ‘Heretical Doubts About the International Mechanism’, Journal of International Economics, 2(4): 443-453.
(6) Samuelson, P. (2004) ‘Where Ricardo and Mill Rebut and Confirm Arguments of Mainstream Economists Supporting Globalization’, Journal of Economic Perspectives 18(3): 135-146.
(7) U.S.-China Economic and Security Review Commission (2017) 2017 Report to Congress. Washington, D.C. Available at https://www.uscc.gov/sites/default/files/annual_reports/2017_Annual_Report_to_Congress.pdf

Also see: Deglobalisation Series | Is anti-globalisation only a preoccupation in the Global North? by Rory Horner, Seth Schindler, Daniel Haberly and Yuko Aoyama

UntitledAbout the author:

Professor Evan Hillebrand taught international economics at the Patterson School of Diplomacy and International Commerce at the University of Kentucky. His most recent book is Energy, Economic Growth, and Geopolitical Futures (MIT Press, 2015).