This essay tries to answer the question, whether the current time can be described as an era of deglobalization.
The genesis of deglobalization can be traced from the advent of 1997 Asian financial crisis, the 2008 global financial crisis and the world economic order based on liberal, rule based multilateral principles which are resilient and durable. The changing dynamics of the world economic order has motivated deglobalization to take root. This creates a world without superpowers and ironically at the same time still remains to be multiplex and multipolar.
Table of Contents
1. The genesis of deglobalization
2. Globalization and its peak (1815–2008)
3. Deglobalization and regional blocs
4. International organizations and disintegration
5. Donald Trump’s presidency and protectionist policies
6. Brexit as a facet of deglobalization
7. Trade as the cornerstone of globalization
8. Global imbalance and trade wars
9. The arms trade and the IMF
10. Emerging market economies
11. Capital investment and fluidity
12. Hedge funds and sovereign wealth funds
13. Bilateral economic negotiations
14. International Portfolio Investment (IPI)
15. New Development Bank (NDB)
16. Information flow and ICT infrastructure
17. Conclusion
Target and Objectives
This work examines the transition from the peak era of globalization to a state of economic deglobalization, analyzing how shifting global dynamics, protectionist policies, and regionalization are challenging the established liberal world order. The research investigates the causal factors behind this retreat and assesses the implications for future international cooperation.
- The impact of financial crises and changing global economic dynamics on deglobalization.
- The role of regional production networks and the disruption of global supply chains.
- Analysis of protectionist policies, including trade wars and the political shift toward nationalism.
- The evolving influence of international organizations and the rise of alternative financial institutions like the New Development Bank.
Excerpt from the Book
The genesis of deglobaization
The genesis of deglobaization can be traced from the advent of 1997 Asian financial crisis, the 2008 global financial crisis and the world economic order based on liberal, rule based multilateral principles which are resilient and durable. The changing dynamics of the world economic order has motivated deglobalization to take root. This creates a world without superpowers and ironically at the same time still remains to be ‘multiplex’ and ‘multipolar’ (Wang Z. and Sun Z, 2020).
When globalization was at its peak ( 1815 – 2008), there was accelerated integration of production and markets at the international level. There was reduction and in some instances elimination of tariffs and quotas in international trade. Capital flows and direct investment amongst nations was on an all-time high. Transnational and multinational organizations made profits since they negotiated diplomatically against trade barriers. They invested in offshore manufacturing of some of their products and at the same time they outsourced some vital services. They enjoyed economies of scale since their products were offered at competitive prices in the wider international market ( Baylis et al, 2017; O’Brien and Williams, 2020).
Deglobalization which is akin to slowbalization ( a term coined by Bakas as cited by Wang Z. and Sun Z.) has been observed as motivating deeper links within the regional blocs and at the same time filling in the ‘vacuum’ of economic globalization which has been retreating for the last decade.
Summary of Chapters
The genesis of deglobalization: Explores the origins of the current trend towards deglobalization, highlighting the role of the 1997 and 2008 financial crises.
Globalization and its peak (1815–2008): Analyzes the historical period of accelerated international integration and the dominance of market liberalization.
Deglobalization and regional blocs: Discusses the shift towards localized production networks and the move away from global trade interdependence.
International organizations and disintegration: Evaluates the failing efficacy of major global institutions like the UN and WTO in maintaining order.
Donald Trump’s presidency and protectionist policies: Examines how US governance between 2016-2020 served to dismantle liberal trade tenets.
Brexit as a facet of deglobalization: Analyzes the UK's decision to leave the EU as a move to regain sovereignty over borders and trade.
Trade as the cornerstone of globalization: Describes the transition of international trade from a global model to a regionalized structure.
Global imbalance and trade wars: Details how competitive hostilities and trade imbalances have hindered international economic recovery.
The arms trade and the IMF: Critiques the involvement of major financial institutions in facilitating the arms trade during global crises.
Emerging market economies: Outlines the challenges faced by emerging markets and the potential for regionalization to provide stability.
Capital investment and fluidity: Investigates the difficulty states face in taxing and regulating mobile, profit-driven global capital.
Hedge funds and sovereign wealth funds: Contrasts the deregulated nature of hedge funds with the government-controlled sovereign wealth funds.
Bilateral economic negotiations: Examines the shift towards bilateral deals over multilateral cooperation, using the US-China relationship as a case study.
International Portfolio Investment (IPI): Discusses the concentration of private investment and its role in propagating economic growth within the neoliberal framework.
New Development Bank (NDB): Highlights the creation of the NDB by BRICS nations as an alternative funding mechanism to the IMF.
Information flow and ICT infrastructure: Assesses the role of technology in global power struggles and the end of ICT monopolies.
Conclusion: Summarizes the need for an "embedded" economy that prioritizes societal needs over purely globalist objectives.
Keywords
Deglobalization, Slowbalization, Regionalization, Protectionism, International Trade, Multilateralism, BRICS, New Development Bank, Financial Crisis, Capital Mobility, Sovereignty, Hegemony, Global Imbalance, Economic Policy, Supply Chains.
Frequently Asked Questions
What is the core focus of this work?
The work focuses on the transition from the era of hyper-globalization (1815–2008) to the current phase of deglobalization, examining the political and economic shifts driving this change.
What are the primary thematic fields discussed?
Key themes include international trade policies, the role of global institutions, regionalization, capital flight, the arms trade, and the influence of major powers like the USA, China, and the UK on the world order.
What is the main research objective?
The objective is to understand why globalization is retreating and to assess how nations are re-evaluating their operational strategies toward domestic production and regional cooperation.
Which methodologies are employed in the analysis?
The author employs a descriptive and analytical approach, drawing on established economic theories and geopolitical case studies to explain historical developments in international political economy.
What does the main body cover?
The main body covers the history of economic integration, the failure of international organizations, the impact of specific political events like Brexit and the Trump presidency, and the emergence of alternative financial structures.
How can the work be characterized by its keywords?
The work is characterized by terms such as deglobalization, protectionism, regionalization, and the shift in global hegemony, reflecting a focus on the restructuring of the world economic order.
How does the author characterize the US-China economic relationship?
The author describes it as previously symbiotic and robust, often referred to as "Chinamerica," but notes that it has shifted towards fierce competition and trade wars.
What role does the New Development Bank (NDB) play in this narrative?
The NDB represents an alternative, non-Western-centric source of capital for the Global South, facilitating cooperation among BRICS nations and using their own currencies.
What is meant by the term "embedded" economy in the conclusion?
It refers to the idea that the economy should serve the needs of society and social justice, rather than society being driven by the demands of the global market.
Does the author suggest that globalization is dead?
The author suggests it is pausing and retreating into a more regionalized form, recommending a shift toward cooperation rather than archaic, one-size-fits-all models.
- Quote paper
- Odhiambo Oduke (Author), 2021, Are We Living in an Era of Economic Deglobalization? Some Salient Facts, Munich, GRIN Verlag, https://www.hausarbeiten.de/document/1131034
