The global order is crumbling and we need a fix to curb humanity’s worst instincts

Jean-Pierre Lehmann calls for renewed faith in multilateral institutions that work for the common good, to ensure a fairer playing field for all in trade and international relations

PUBLISHED : Wednesday, 12 April, 2017, 4:58pm
UPDATED : Wednesday, 12 April, 2017, 7:26pm

I was in Cancún in 2003 for the WTO ministerial meeting to witness the initial cracks in the global governance edifice.

The World Trade Organisation was established in 1995 following the completion of the GATT Uruguay Round. It was hailed as the first institution in this new era of globalisation, a new global dawn. The post-war global trade regime had been dominated by the rich countries in what came to be known as “The Quad” – Canada, the European Union, Japan and the US. So-called third world countries were on the periphery. If they got to be too “uppity” – that is, competitive – such as the four “Asian tigers” (Hong Kong, South Korea, Taiwan and Singapore) in garments and textiles, the quad would respond with various means of protection: in this case, the Multi-Fibre Agreement, which lasted from 1974 to 2004, by imposing quotas.

The system was grossly unfair, the playing field was heavily tilted against developing countries, but for the most part they had not minded too much as they were pursuing mainly autarchic economic policies. Trade with the rich countries, as the influential Argentine economist Raúl Prebisch warned, would result in neo-colonial exploitation.

In the wake of the Chinese market reforms launched by Deng Xiaoping ( 鄧小平 ) in the 1980s, there has been a global market revolution whereby developing countries realised the benefits trade could bestow to development and poverty reduction. Thus, they sought to join the global trading system. For the benefits to accrue, however, there was an imperative to level the global trade playing field. Hope was raised when in 2001 China – historically one of the most acute victims of Western and Japanese predatory imperialist trade policies – was admitted to the WTO and its members committed to the launch of the Doha Development Round.

Two years later, in Cancún, Mexico, these hopes were dashed. From the moment we arrived, it was clear that whatever “concessions” may have been granted in the spirit of Doha, mercantilist resistance would dominate the spirit of Cancún. The talks collapsed and the Doha round fell into a coma. Various attempts at reviving the round having failed, it lies there in Geneva in its apparently permanent comatose state.

Especially illustrative of the sad fate of Doha in Cancún was the issue of cotton trade. Cotton plantation owners in the US are heavily subsidised, thus American cotton is dumped on global markets, especially at the expense of poor African cotton farmers. Efforts by African negotiators to rebalance the playing field were staunchly resisted by the US – 2004 was an election year and financial contributions from cotton plantation owners were important.

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The year 2003, however, will be remembered for more than the collapse of Doha. It was the year that saw the illegal US-British invasion of Iraq. By any account, it was one of contemporary history’s most catastrophic geopolitical acts, the cataclysmic consequences of which remain part of the global landscape today and are unlikely to dissipate soon. While the US government was calling upon China to be a “responsible global stakeholder”, it was causing havoc in the Levant.

With Doha and Baghdad, it became apparent that the world was entering a Darwinian era in which the stronger prevails and where might, when exercised by the powerful, is right. After the illegal invasion of Iraq, the US was not subjected to sanctions, nor excluded from any global club, such as the G8. When, on the other hand, a decade after the American invasion of Iraq, the Russians illegally invaded Ukraine, all sorts of sanctimonious hell broke loose, sanctions were imposed and Russia was expelled from the G8. What is sauce for the Russian goose is not sauce for the American gander!

With Doha and Baghdad, it became apparent that the world was entering a Darwinian era in which the stronger prevails and where might, when exercised by the powerful, is right

Thus China’s flouting of the Hague tribunal decision in respect to its disputes with the Philippines in the South China Sea, under the terms of the UN Convention on the Law of the Sea, was by no means an aberration in global affairs of the early 21st century, but very much part of a pattern. While the US has condemned and even threatened China over the issue, Washington has in fact refused to be a signatory to the UN convention.

Where the effects of the collapse of the edifice of global governance may in fact be the most harmful in the long term is over climate change. The bilateral Sino-American agreement to ratify the Paris climate accord reached at the Hangzhou (杭州) G20 summit in September last year was seen as a most notable breakthrough. But President Donald Trump’s threat to withdraw from the agreement once again dashes hopes and further crumbles the collapsing edifice.

The launch of 59 US Tomahawk cruise missiles at Syria’s Shayrat air base last week in retaliation for the alleged use by the Assad regime of chemical weapons may seem morally justified. Nonetheless, the legality of the unilateral action is dubious.

There is no doubt that the use of chemical weapons, especially on civilians, is a repulsive crime against humanity. From a more cynical realpolitik perspective, however, once again the consequences may depend on who is using them. The US made ample use of chemical weapons in its wars in Indochina. When Iraq, at the time a friend of the US, used chemical weapons in its war against Iran in the 1980s, Washington looked away.

We live in a world full of magnificent opportunities and some notable achievements. The latter are especially reflected in the significant reduction of poverty in many parts of the world. A decade after its 1975 victory in war with the US, Vietnam undertook radical economic reforms, as a result of which acute poverty was reduced from 50 per cent of the population to a remarkable 3 per cent.

We urgently need to restore, repair, refurbish and renew the edifice of global governance

The impact of the amazing IT revolution, in particular that of mobile telephony, has generated unprecedented connectivity for billions who once lived in isolation. The Hong Kong-based Indonesian home helper can today speak to her mother in a remote Java village – something unthinkable not that long ago. Many more positive examples can be cited.

That’s the silver lining. The great big black cloud looming over the horizon, however, is the global decline due to Darwinian anarchic lawlessness. This is occurring in a time of socio-political turbulence, with the vituperative rise of nationalism, and heightened big-power rivalry, especially between China, Russia and the US. Conflicts of all sorts – territorial, religious, ethnic, trade, monetary, climate, and so on – are threatening.

When I went to Cancún in 2003, I had two grandchildren. In the meantime, I have had five more, hence seven. I worry for their future.

For their sake, indeed for the sake of all new generations of humanity, we urgently need to restore, repair, refurbish and renew the edifice of global governance and especially solidify its foundations. This must be a collective effort, involving much more than governments, including civil society, business, academia and the media. A total collapse would be catastrophic.

Jean-Pierre Lehmann is emeritus professor at IMD, founder of The Evian Group, and visiting professor at the University of Hong Kong