Gloria Spittel questions the relevance of globalisation in modern times

A year into Donald Trump’s presidency, globalisation through international trade appears to be on the back burner for the US. Increased protectionism, localisation and an ‘America First’ platform seem to ail US policy making these days. However, a cursory glance at the agriculture or farming sector in the United States would indicate that protectionism in trade is not an entirely new phenomenon vis-à-vis US economic development.

What’s new is that the world has been given notice of Uncle Sam’s intentions of non-participation in large multilateral trade deals such as the Trans-Pacific Partnership (TPP), which the US has pulled out of. Yet, the world’s largest economy is accustomed to setting a path on which the rest of the world has treaded.

So in the face of these new changes stimulated by the US, how does globalisation fit in?

Inward looking policies by governments and their polities may serve short and mid-term goals especially in socialist, welfare or economies faced with austerity measures. But in the long run, global integration and trade is necessary if only to maintain a known world order, while countries attempt gradual changes spurred by climate change, global economic growth, ageing populations and increasing debt.

CHINA TO THE FORE In the wake of the US looking increasingly inward, the world’s second largest economy appears to have stepped in as promoter of globalisation. China has become an influential trading and development partner for much of Asia, Africa and beyond.

Recognising the importance of globalisation, China unveiled its foreign policy through the Belt and Road Initiative (BRI), pledging US$ 125-150 billion to develop ports, railways and other facilities in over 65 countries – primarily in Asia en route to Europe.

China’s vehement support for globalisation, economic integration and trade relations with other countries is primarily to support the development of its domestic economy. But this assertion is true of all international trading countries. What’s important is that globalisation through trade and economic integration of countries remains relevant in today’s global economy.

CROSS BORDER FLOWS And the age-old question of what’s meant by globalisation is also relevant. While China supports economic and trade integration between countries, there have been worrying signs of capital and human flows. Indeed, the freedom of cross border human flows is constantly tested in globalisation debates.

The Brexit vote in 2016 was yet another blow to human movement across national borders for employment and livelihoods. Whether this situation of curtailed people movement, especially those from the global South, will be remedied under Chinese led globalisation is doubtful although the BRI suggests increased people to people interactions and intercultural exchanges.

EMPLOYMENT MILIEU Further compounding the issue of human labour and employment – and relocating for employment – is the advent of AI and robotics amidst IoT or what’s being termed the ‘Fourth Industrial Revolution.’ The rising tide of automated jobs is a disruption to labour markets across the world, which may increase unemployment if arrangements aren’t made.

Preparing for impending unemployment revolves around job creation and growth. Not only are there opportunities for these in emerging economies but developed countries too offer new areas for cross border employment. For instance, as populations across developed countries continue to age and fertility drops, opportunities in innovative support services may arise.

CLIMATE CONCERNS Additionally, the challenges the world faces with the effects of climate change and global warming, and the increasing importance placed on mitigating these environmental trends by governments in most countries through policy and legislation, offer a stimulus for discovery and innovation across industries. For instance, legislation that decrees a cut in emissions requires policies that support the use of alternative energies in daily life.

All of this bodes well for job creation in new, alternative and non-traditional industries.

DIGITAL NOMADISM But the nature of work itself is changing. Borrowing concepts from process outsourcing, professionals are willing to work on projects and in dispersed teams in a phenomenon known as ‘digital nomadism.’ The implications of agile, mobile and flexibility of (and at) the workplace mean that organisations are prepared for change, and to institute managerial policies for effective talent acquisition and management.

The future of globalisation will not remain in the hands of governments or large international treaties and bodies. Instead, businesses both large and small across the world will become propellers of economic growth, and knowledge development and sharing.

For instance, the Colombo International Financial City (CIFC a.k.a. Port City), while being a venture between the Sri Lankan and Chinese governments, will increasingly see private sector investment.

Similarly, foreign direct investment (FDI) inflows, joint ventures and private-public partnerships in economic sectors or clusters and mega infrastructure development will become a beneficial norm.

So globalisation will continue to be relevant, important and necessary. But the way in which it is pursued will be dictated by swirling currents across industries, technological developments, environmental degradation, population demographics and the changing nature of work.