News Americas, LONDON,
England, Weds. Sept. 4, 2019: Last month, the Group of
Seven (G7) most advanced economies failed to reach a consensus on the major
challenges the world faces.
Their inability to agree,
confirmed that finding common solutions to global political and economic
problems has become all but impossible. In
the chic French resort of Biarritz, critical issues relating to climate change,
trade and tariffs, re-engagement with Russia, and energy policy went
unresolved, despite the best efforts of France’s President, Emmanuel Macron,
now the clear leader of the EU27.
As a consequence,
it is difficult to see how the G7 will in the future be able to agree responses
to global crises, boding ill not only for any positive outcome when larger
groupings such as the G20, which includes, Russia and China meet next year in
Saudi Arabia, but also for deliverable outcomes from other multilateral
This is happening
just as the position of Britain and its long-standing commitment to finding
common global responses may be about to be compromised by Washington’s desire
post-Brexit to see it become increasingly reliant on the US.
In mid-August the
US National Security Adviser, John Bolton, after meeting Britain’s Prime
Minister Boris Johnson, told the media that President Trump wanted to see a
successful British exit from the EU on October 31st, and that
Washington was ready to rapidly deliver a US-UK free trade agreement starting
on a sectoral basis.
Johnson may well
wish to position the UK somewhere between the US and the EU and as a future
US-EU27 intermediary, but this and Bolton’s other aggressive comments on Europe
and China suggest Washington sees matters very differently, regarding the UK as
a vehicle for the US President’s desire to undermine and weaken the EU.
What this growing
global dislocation reflects is the extent to which, during his three years in
office, President Trump has been able to change the world order by purposely
disrupting consensus and by acting unilaterally and unpredictably in pursuit of
his ‘America First’ agenda.However, the consequences are becoming
By abjuring global
leadership and adopting an imperial style, Trump, who conceivably may win a
second term, is forcing other nations and institutions to begin to give thought
to alternative alliances and responses.
Most strikingly he
is accelerating the strategic economic and military partnership between China
and Russia. Although both countries act in different ways, their
sometimes-uneasy relationship has been deepening since the 1970s.
In late July this
became particularly visible when in an unprecedented action, Russian and
Chinese military aircraft undertook a joint reconnaissance mission aimed at
testing Japan and South Korea’s defenses, and by extension the reaction of the
have begun to consider how to respond to the economic consequences of
Washington’s willingness to start trade wars and introduce sanctions,
irrespective of the implications for global economic growth.
In this context a
little noticed discussion took place in late August at the annual meeting of
central bank governors at Jackson Hole in the US. There for the first time the
view emerged that what is happening in the global economy can no longer be
solved by coordinated monetary responses because unpredictable US trade and
political policy now makes past solutions to economic shocks of limited value.
This led Mark
Carney, the soon to step down Governor of the Bank of England, to suggest that
as the world economy reorders, the dollar will cease to be the most important
asset and medium of exchange.
waiting for the Chinese renminbi to compete as a reserve currency, the better
response he suggested, would be, for the IMF to begin building a new international
monetary and financial system based on multiple global currencies. Others in a
similar vein proposed that a global electronic currency linking central bank
digital currencies could reduce the influence of the US dollar and the US on
there is also a newfound willingness to respond more honestly or even
coercively to nations that do not accept their shared responsibility for
As has been widely
reported, Brazil and other nations including the Democratic Republic of Congo
and Angola, largely through governmental inaction have been enabling the
burning of large tracts of rain forest. This has been happening as the US
President has expressed a desire to buy the self- Governing Danish Overseas
Territory of Greenland in order to exploit its minerals and obtain geostrategic
advantage from the warming of the Arctic Ocean.
In a response that
may set future parameters, France and some other European nations indicated
that if Brazil did not act to halt illegal deforestation, they would not ratify
the recently agreed EU-Mercosur free trade agreement. In a similarly direct
response, Denmark’s Prime Minister, Mette Frederiksen, described as “absurd”
the US President’s apparent wish to reinterpret the Monroe doctrine.
What this all
suggests is that the more that some nations pursue aggressively their economic
advantage through trade, confrontation and hegemony, others will begin to
explore new alliances and alternative forms of global architecture that protect
This has near
horizon implications for the Caribbean, which despite multilateralism’s many
shortcomings has seen consensus-based global policies support the region’s
development and see the lives of most of its citizens change for the better.
The Caribbean cannot just sit on its hands and allow the future to be dominated by states with leaders inclined to behave imperiously in the hope that the status quo ante will prevail. It needs to find its voice and encourage a new generation of thinkers able to develop in alliance with others alternative thinking about new global political and economic mechanisms that will protect the interests of small states in an increasingly belligerent self-seeking world.
|For this reason, the recent decision to ask Barbados’ former Prime Minister, Owen Arthur, to chair a global commission on critical small island issues ahead of next year’s quadrennial UNCTAD conference to be held in Bridgetown is welcome.
However, this will only have value if it I able to identify practical development responses in a world in which consensus may no longer be possible.
EDITOR’S NOTE: David Jessop is a
consultant to the Caribbean Council and can be contacted at [email protected].
Previous columns can be found at www.caribbean-council.org.
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