In a recent article “Washington’s New Narrative for the
Global Economy” in Project Syndicate, Dani Rodrik claimed that US policymakers,
“believe that the post-1990 model of globalization, which prioritized free
trade and free markets over national security, climate change, and the economic
security of the middle class, has undermined the socioeconomic foundations of
healthy democracies.” This is a new language, a different discourse from the
one the developing countries are used to hearing about the benefits of trade
and globalization. And what may have caused this new reality is China’s rising
world supremacy.
اضافة اعلان
The US has passed three legislative pieces in 2022 that pour
over $1.22 trillion into infrastructure and innovation. Interestingly, they
favor domestic production and the products of countries that have free trade
agreements with the US. Prominent among those products are electric vehicle
batteries. (Note that Jordan could benefit from such a development as it is one
of few countries that enjoy a free trade agreement with the US).
The US has passed three legislative pieces in 2022 that pour over $1.22 trillion into infrastructure and innovation. Interestingly, they favor domestic production and the products of countries that have free trade agreements with the US.
A new emphasis by the US on climate change targets China as
a major polluter and, thus, places
restrictions on its products. Digital security means no technology transfer to
China and prohibitions that are imposed on its digital giants. Job creation and
corporate tax competition mean bringing investment and jobs to the US. The
biggest loser is possibly China, should it not react, which would lead to an
economic war or a shifting of main industrial outlets from China into the US.
Yet this is one of a slew of procedures of curtailment that
were adopted by the US administration to depress the Chinese economy from
becoming the leading economy. One could
not, therefore, state that the supremacy of the Chinese economy is being
denigrated only via a separate agenda.
After all, a review of the lengthy, challenging, and arduous process
that China had to endure to gain membership in the World Trade Organization
proves beyond any shadow of a doubt that the US was actively involved in an economic
war. Furthermore, the US has virtually imposed a technological blockade on
China. If this is not an economic war, what is?
The US shift in economic policy and outlook to globalization
provides a lesson to those who still espouse the view that free trade and free
markets are beneficial to all is bogus. The industrial countries only promoted
the free trade paradigm when they knew that they would be the benefactors from
free trade, they are the ones with the expensive, complex, and
knowledge-intensive products. When they lost their edge to newcomers, such as
China, they started to talk about another game: deglobalization. Industrial
policy which had been shunned in the 1990s, is now back in vogue, why? China
happened.
Yusuf Mansur is CEO of the Envision Consulting Group and former minister of state for economic affairs.
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