- 2018-10-18
Can emerging powers save the global liberal order?
Chinese President Xi Jinping delivered a speech at the World Economic Forum in Davos, condemning protectionism and defending globalization, which shows that China is positioning itself to fill the global leadership gap that the Trump administration may leave.
Since Donald Trump was elected President of the United States, people have been very worried about the future of the liberal international order. Trump's victory in the November election raised an important question: Will the emerging powers protect the existing arrangements, or will they act as the last resort to end the existing arrangements?
The decline of the international system may have been for some time. The expansion of global trade has also slowed down for some time. Another key element of the liberal order—the network of post-war multilateral institutions established and maintained by the United States—began to disintegrate before Trump arrived. The global democratic revolution, which almost doubled the number of democracies after the end of the Cold War, peaked in 2000.
Until now, people have generally believed that challenges to the liberal order mainly come from emerging powers such as China, India, and Russia. But Trump’s victory and the Brexit referendum show that the liberal order is collapsing from within.
Will this push emerging powers into the driver's seat? not necessarily. First, Russia, China and India have different interests. If Trump’s policies undermine Nato and other alliances led by the United States, Russian President Vladimir Putin will obviously benefit. As Brexit weakens the European Union (EU), now is Putin's proud moment in international affairs.
But for China, weakening the liberal order is far less in line with its interests. Certain elites in China cheered Trump's victory. They believe that the death of the Trans-Pacific Partnership (TPP) has opened the door to other regional arrangements such as the Regional Comprehensive Economic Partnership (RCEP). But the situation is not that simple. RCEP is a multilateral initiative. The main obstacle here is not the TPP, but India’s difficult negotiating position, which cannot be changed. Japan will also resist China's dominance of RCEP.
The weakening of the US alliance in Asia will also cost China. This may lead Japan and South Korea to seek nuclear weapons, which is not in China’s interest.
Although Indian Prime Minister Narendra Modi quickly congratulated Trump, if the alternative would further empower China, then India would have no interest in subverting the liberal order.
The recent tensions surrounding India’s membership in the Nuclear Suppliers Group and terrorism show that China and India do not have a common vision for an alternative world order. India is a key member of the Asian Infrastructure Investment Bank (AIIB), a multilateral institution initiated by China, but it opposes the Bilateral One Belt, One Road initiative because it weakens India Influence in South Asia (especially the China-Pakistan Economic Corridor).
Another factor that weakens the challenge posed by emerging powers to the existing international order is that when Trump won, these powers themselves were in a very serious economic and political dilemma. The average growth rate of the five so-called Brics countries (Brazil, Russia, India, South Africa and China) slowed from 9% in 2010 to about 4% in 2015. Investment growth slowed from 16% in 2010 to 5% in 2014. In 2015, Goldman Sachs closed its BRIC Investment Fund, whose value fell 88% after peaking in 2010.
Part of this is due to the decline in commodity prices (especially affecting Russia, Brazil and South Africa) and the tightening of the global financial environment following the 2008 global financial crisis. China's transition from an export-driven economy to a structural reliance on domestic consumption is also a contributing factor.
As the World Bank pointed out in January last year, other factors include reduced productivity, volatility in the stock and foreign exchange markets, and increased debt burdens. For example, in South Africa, the ratio of government debt to gross domestic product (GDP) rose from just under 28% in 2008 to more than 50% in 2015. The debt levels of Brazil and India exceed 60% of GDP.
Therefore, it is unlikely that emerging powers will take advantage of crises in the global liberal order in a coordinated manner. On the contrary, these hypothetical challengers to the global liberal order may hesitate and even provide greater support for the order. Although China's attitude towards globalism rejects the political values of freedom, it may help alleviate the international uncertainty caused by the Trump administration.
Box: What is an emerging power?
The easiest and most intuitive way to evaluate emerging powers is to look at the international rankings of their economic aggregates. The developing countries that entered the top 30 in the world in 2011 include: China, Brazil, Russia, India, Mexico, Turkey, Indonesia, Poland, Saudi Arabia, South Africa, Argentina, Iran, Thailand. There is also an equally simple judgment method, which is to look at the acceptance of this country by international economic organizations, especially the strong clubs.