Quebec, Qingdao and the new age of multilateralism
The contrasting events that transpired in the cities of Quebec and Qingdao over the weekend signalled the immediacy of the changing world order. At the meeting of the Group of Seven (G7) advanced nations in Quebec, Trump went beyond expectations in ensuring that multilateralism sees its early demise while some 10,000 kilometres away in the coastal city of Qingdao, new beginnings were made at the Shanghai Cooperation Organisation (SCO) as if to negate all that was undone across the Pacific.
 
It is evident that Trump attended the G7 in protest. He made no amends with his allies over escalating tariff wars but, instead, upped his threats. He arrived late for meetings, lashed out at other leaders and left early. He even pulled out of the joint statement and later berated his hosts over Twitter. After the meeting of Trump with Kim Jong-un, the US might be on better terms with North Korea by the end of this week than it is with its allies.
 
By isolating himself so completely, Trump has possibly killed the G7 as the US was the power holding the group together. Currently, it is the only platform for the Western countries that acts as a steering committee for the world economy. There was a reason that the second-largest economy of the world, China, was kept out of the group. Without America's support, G7 will find it impossible to survive. The power vacuum can only be filled by China and it is doing so, quite effectively.
 
Snubbed by the US, Europe has been rolling out the red carpet for China by enthusiastically participating in its Belt and Road Initiative (BRI) and other such multilateral and bilateral efforts. The SCO was yet another successful attempt by China to strengthen regional ties; this time in Central Asia. The group that started off as the "Shanghai 5" in 1996 (Kazakhstan, Kyrgyzstan, China, Russia and Tajikistan), mainly for ensuring regional security, has evolved into the SCO that now includes India and Pakistan within its fold and espouses a global vision with a strong economic mandate. The regional grouping accounts for about 40 percent of the world's population and 20 percent of its GDP.
 
By contrast, the G7 countries account for only 10 percent of the world's population but 50 percent of its GDP. Yet, the SCO nations presented a more promising front this weekend. They stood for everything the G7 could not. While the industrialised nations were engaged in personality clashes, the Asian grouping was more proactive in engaging in dialogues of regional cooperation and development. In a veiled dig at the US for withdrawing from the Iran deal, Hassan Rouhani was also given a warm welcome at the SCO and the Asian leaders even promised to try and save the deal from meeting a premature end.
 
It is sometimes naively believed, or rather hoped, that the withdrawal of America from the established global economic order is merely a passing phase and as Trump moves out of office, the idea of multilateralism will somehow revive itself. But it needs to be understood that Trump is not acting on his own accord. His voters have strongly come to abhor the idea of globalisation and free trade. They believe that they have been short-changed in the entire process and will not vote for anyone who promises to revert to the old days. So, the establishment of the Asian century is inevitable.
 
India, on its part, can have a greater role to play in this new world order. To its credit, the country has been at the forefront engaging vigorously with numerous world powers and regional groupings. However, its emergence as a global power will depend on its ability to decisively influence multilateral processes. For instance, India has remained steadfast in its opposition to China's Belt and Road Initiative.
 
At the SCO, Prime Minister Narendra Modi even remarked that India would welcome any connectivity projects that respect the sovereignty of other nations.
 
But, expectedly, New Delhi finds itself alone in its opposition to the project. India lacks the economic heft to sway multilateral agreements in its favour. That remains its Achilles heel.
 
The changing world order presents an opportunity for India to make its mark on the world stage. It needs to expedite the resolution of its economic shortcomings. It has the benefit of being the biggest democracy in Asia and leverage it to its advantage. Surely, if India could present a viable alternative to China, the European nations would prefer siding with a liberal democracy than an iffy autocracy.
 
Disclaimer: Information, facts or opinions expressed in this news article are presented as sourced from IANS and do not reflect views of Moneylife and hence Moneylife is not responsible or liable for the same. As a source and news provider, IANS is responsible for accuracy, completeness, suitability and validity of any information in this article.
Like this story? Get our top stories by email.

User

COMMENTS

SUBHASH CHATTERJEE

4 months ago

Right time for India to make the right moves for a powerful place on the World Economy Order

China's ZTE to pay USD1 bn fine to escape 'death sentence'
Chinese telecom equipment maker ZTE has agreed to pay USD1 billion as fine as part of a new deal with the US Commerce Department in an attempt to avoid a ban on the company that prevents it from buying American parts, the media reported.
 
ZTE, which employs 70,000 people in China, described the move by the US regulators to cut it off from its US parts suppliers as a "death sentence".
 
Under the deal announced by US Commerce Secretary Wilbur Ross on Thursday, ZTE will also set aside $400 million in escrow to cover any future violations, the National Public Radio (NPR) reported. 
 
"This is a pretty strict settlement, the strictest and largest fine that has ever been brought by the Commerce Department against any violator of export controls," Ross said in an interview with CNBC.
 
Under the deal, ZTE will also fund a US team to oversee the company's compliance. The company has also agreed to change its board of directors and executive team.
 
However, senators of both parties in the US were quick to express their displeasure at the terms of the new deal.
 
"The Trump administration is giving ZTE and China the green light to spy on Americans and sell our technology to North Korea and Iran, as long as it pays a fine that amounts to a tiny fraction of its revenue," Democrat Senator Ron Wyden was quoted as saying in a statement by NPR. 
 
Republican Senator Marco Rubio also called it a "very bad deal". 
 
"I assure you with 100 per cent confidence that #ZTE is a much greater national security threat than steel from Argentina or Europe. #VeryBadDeal," Rubio tweeted.
 
The US had imposed sanctions on ZTE for illegal sales to Iran and North Korea, but the Chinese company agreed to take corrective action. 
 
But when regulators in the US found ZTE to be violating the terms of the agreement, they cut off the firm from its US parts suppliers. 
 
The Commerce Department imposed a seven-year ban on ZTE on buying American parts in April, The Washington Post reported.
 
Disclaimer: Information, facts or opinions expressed in this news article are presented as sourced from IANS and do not reflect views of Moneylife and hence Moneylife is not responsible or liable for the same. As a source and news provider, IANS is responsible for accuracy, completeness, suitability and validity of any information in this article.
 

 

User

Jordan PM resigns after tax protests, new leader appointed
Jordanian King Abdullah II on Monday appointed former Education Minister Omar Razzaz as the new Prime Minister after the resignation of Hani Mulki from the top post following nationwide protests.
 
Embattled Prime Minister Mulki submitted resignation to King Abdullah II after major protests were held across the country, with tens of thousands of demonstrators calling for the sacking of the government over a controversial income tax reform bill, Xinhua news agency reported.
 
Demonstrators demanded the withdrawal of the income tax law, part of several fiscal reforms as part of a $700 million extended fund facility programme signed between Jordan and the International Monetary Fund in 2016.
 
The bill mainly aims to improve tax collection, curb tax evasion and boost tax revenues, which are expected to increase by 300 million Jordanian dinars ($423 million) annually.
 
In addition, the proportion of income taxpayers in Jordan is expected to rise from 4.5 per cent to 10 per cent once the bill is enacted. The legislation has been resisted by multiple sectors, including professional associations and investors. 
 
Earlier in the day, 57 lawmakers out of the 130-seat Lower House of the Jordanian Parliament signed a letter asking the country's king to fire Mulki. They said the policies of Mulki had pushed "the country to explode", referring to last week's unprecedented general strike.
 
"This government no longer has our confidence," the lawmakers wrote in the letter, signed by the National Alliance for Reform, led by the Islamic Action Front, the political wing of Jordan's Muslim Brotherhood.
 
On Sunday, protesters took to the streets for a fourth consecutive day, despite the government reversing a decision to raise fuel and electricity prices.
 
Disclaimer: Information, facts or opinions expressed in this news article are presented as sourced from IANS and do not reflect views of Moneylife and hence Moneylife is not responsible or liable for the same. As a source and news provider, IANS is responsible for accuracy, completeness, suitability and validity of any information in this article.

User

We are listening!

Solve the equation and enter in the Captcha field.
  Loading...
Close

To continue


Please
Sign Up or Sign In
with

Email
Close

To continue


Please
Sign Up or Sign In
with

Email

BUY NOW

online financial advisory
Pathbreakers
Pathbreakers 1 & Pathbreakers 2 contain deep insights, unknown facts and captivating events in the life of 51 top achievers, in their own words.
online financia advisory
The Scam
24 Year Of The Scam: The Perennial Bestseller, reads like a Thriller!
Moneylife Online Magazine
Fiercely independent and pro-consumer information on personal finance
financial magazines online
Stockletters in 3 Flavours
Outstanding research that beats mutual funds year after year
financial magazines in india
MAS: Complete Online Financial Advisory
(Includes Moneylife Online Magazine)