Is a new world economic order emerging? | Counting the Cost

Summary

In this episode of 'Counting the Cost,' Adrian Finigan explores the shifting global economic order amidst US-China trade tensions and the rise of economic alliances like BRICS. Experts discuss whether the dominance of Western-led institutions is waning, the potential emergence of new global powers, and the future of globalization and multilateralism. Key topics include the challenges facing the World Trade Organization, the role of the US dollar, and the evolving economic and geopolitical landscape shaped by new alliances and industrial policies.

Takeaways

• 🌍 The global economic order is shifting due to geopolitical tensions and backlash against globalization.
• 🇺🇸🇨🇳 The US-China trade war is escalating, challenging the dominance of the old economic system.
• 🧩 Developing nations are forming economic alliances like BRICS to counter Western dominance.
• 🌐 Economic integration and globalization, led by the US, are being questioned and disrupted.
• 🏛️ The World Trade Organization is in limbo as countries impose trade restrictions and focus on future industries.
• 💰 The BRICS nations are pushing for a more balanced and inclusive global economic governance system.
• 💵 The dominance of the US dollar in global trade is being questioned, with some advocating for trade in their own currencies.
• 🏗️ BRICS nations aim to create an alternative to US-led financial institutions like the IMF and World Bank.
• 📊 BRICS represents nearly a third of the global economy and nearly half of its population, with ambitions to champion the global South.
• 🔄 Countries like China are redirecting their economies away from the West, forming new trade and investment alliances.

Q & A

What are the main themes discussed in the 'Counting the Cost' episode hosted by Adrian Finigan?

The episode discusses the shifting global economic order, geopolitical tensions, the trade war between the US and China, the rise of economic alliances like BRICS, and the potential collapse of the old system dominated by the US.

What are BRICS countries, and what is their main objective?

BRICS countries include Brazil, Russia, India, China, and South Africa. Their main objective is to counter the dominance of Western financial institutions and create a more balanced and inclusive global economic governance system.

How has the US-China trade war influenced the global economic order?

The US-China trade war has fueled shifts in global alliances, led to the imposition of trade restrictions, and pushed countries to build new economic and political alliances. It has also accelerated the fragmentation of the old rules-based global economic order.

What challenges are facing the World Trade Organization (WTO) according to the episode?

The WTO is described as being in limbo, with multilateralism under attack and the organization's dispute settlement mechanism largely in abeyance. Nations are increasingly imposing trade restrictions and looking to protect their own industries.

What is the significance of the new development bank founded by BRICS?

The New Development Bank aims to provide an alternative to US-led financial institutions like the World Bank and the International Monetary Fund, helping BRICS countries reduce their reliance on the US dollar and promote economic cooperation among themselves.

How are geopolitical tensions affecting the global economic landscape?

Geopolitical tensions, particularly between the US and China, are leading to new trade and investment patterns, with countries seeking to protect their national security interests and industrial policies over the principles of open markets and globalization.

What perspectives were shared by the panel of experts on the future of the global economic order?

The experts had varied views, with some suggesting a shift towards regional economic groups and others emphasizing the need to uphold principles of economic efficiency and multilateralism. They discussed the importance of adapting to new realities while maintaining elements of the old order.

What role do developing countries play in the changing global economic order?

Developing countries are increasingly forming economic alliances like BRICS to enhance their collective bargaining power and create more equitable global governance structures. They are pushing for reforms to better reflect their growing economic significance.

How has the relationship between the US and China evolved in recent years?

The relationship has been marked by escalating trade wars and mutual accusations of market protectionism and bullying. Both countries are seeking to assert their economic dominance and influence global norms and rules, often at the expense of cooperation.

What future scenarios were discussed regarding the dominance of the US dollar?

The future of the US dollar as the dominant global reserve currency was questioned, with some suggesting that sentiment and confidence will play a significant role. The potential rise of alternative currencies, especially within BRICS, was highlighted as an area to watch.

How do smaller and emerging economies view the current global economic challenges?

Smaller and emerging economies are seeking to leverage the current shifts to find new opportunities and assert their agency. They are interested in reforms that promote fair trade and economic cooperation while maintaining stability and avoiding outright conflict.

What are the implications of economic nationalism and protectionism on global trade?

Economic nationalism and protectionism are leading to the fragmentation of global supply chains and increased uncertainty in international trade. These trends undermine the principles of globalization and multilateralism, potentially leading to less efficient and more fragmented economic outcomes.