Antidote to deglobalization

Belt and Road Initiative is a significant catalyst for a more integrated world and more interconnected global trade

During the past 10 years, there have been calls for deglobalization and decoupling as a means to curb unbalanced trade, rein in immigration, and mend inequalities of assets and wealth. Some consider the world to have entered a period of deglobalization, citing recent events such as Brexit, Trumpism, the Ukraine crisis, problems with supply chains, the global energy crisis and the past decade's decline in foreign direct investment.

Yet it would be a grave mistake to overlook the benefits of globalization which are being ignored to serve populist politics. Benefits such as interconnectivity between cultures, access to markets, lower cost of products, unimpeded trade, spread of technology and innovation, better utilization of human talent, and higher standards of living across the globe are essential for economic growth, human development and societal stability.

During the last three decades the world has also witnessed a gradual erosion of the United Nations' credibility despite the essential usefulness of its many structures, with many impotent organs paralyzed by state rivalries. This trend ignores the fact that if we were to dismantle the UN system today, we would probably reinvent it tomorrow because of the global nature of today's challenges. The United Nations International Children's Emergency Fund, the International Civil Aviation Organization, the World Health Organization, the World Food Programme, the United Nations Population Fund, and all other UN organs are in fact useful tools for addressing today's challenges such as global warming, pandemics, poverty and the green energy transition in a collective fashion. In other words, the failures of the UN Security Council in preventing wars and its shortcomings in preserving peace should not cloud our judgment on the usefulness of the UN global system.

Similarly, the World Trade Organization was established with a view to facilitating trade for the benefit of all, managing competition, regulating trade, settling trade disputes, and serving as a forum to negotiate trade agreements. However, its authority and reputation have also been undermined by several practices, including the delayed arbitration process and inability to agree on new rules for agricultural products — highlighting clashing views between developing and developed countries — rules which favor multinational companies while hindering developing nations from developing their infant industries, and the persistence of protectionist tariffs.

With this negative sentiment engulfing global action, the Belt and Road Initiative stands as a unique avenue to boost investments, create jobs, and upgrade the infrastructure needed for trade, perhaps in a way not seen since the end of World War II.Since it was launched in 2013, the BRI has managed to attract more than 150 partner countries and 30 international organizations, and over 200 BRI agreements have been signed to connect multiple continents across land and sea.

Amid Western criticism and skepticism of the BRI, the US proposed its own Build Back Better World initiative in June 2021, and the European Union proposed the Global Gateway Initiative, a few months later in December. Both plans were anchored on the same fundamentals as the BRI, signifying that China has successfully challenged the existing geopolitical frameworks in Africa, Latin America and even more importantly in East and Southeast Asia. Both Western initiatives were also testament that global trade is essential for human development and growth. Moreover, technology has unleashed powerful globalized trends that are irreversible, whether that is in international travel, finance and trade, or borderless criminal, terrorist and health threats.

There is a problem with the assumption that deglobalization is a fact on the ground. The data does not fully back it up. A closer look at economic data shows that even though governments have increasingly adopted policies aimed at strengthening their own resilience, the world economy is still evolving to become more, not less, globalized in key fields, and more dependent on Chinese supply in particular. Global trade surged during the pandemic, and the world's trade with China accelerated rather than slowed. A pandemic-era shift toward goods and away from services partly accounts for the acceleration. But the growth in trade with China also reflects the fact that China is simply producing quality high-tech exports such as electric vehicles, wind turbines, solar panels and vital electronic and battery components — at a price few can match.

Tariff wars always get news coverage, yet this should not be seen as evidence of deglobalization. In reality, countries lacking preferential access to the US market, for example, can still do incredibly well with the WTO's standard trade terms. In fact, US imports from Southeast Asia have soared in the past six years. The Southeast Asian members of the Trans-Pacific Partnership increased their exports to the US much more rapidly after Trump withdrew from the TPP than before. In fact, since the introduction of the Trump tariffs, China's economy has only become more central to world trade. Even with the rise in Western tariffs on China, the world's economy is still deeply integrated. If anything, Western-Chinese interdependence has been masked, not severed.

Allowing the WTO and international agreements and institutions to decay only makes the world less efficient in its efforts to safeguard peace and achieve prosperity. Deglobalization could vanish quickly but it could remain until policymakers are able to reform international institutions to bestow them with sufficient power to operate efficiently. Equally important is to accept the reality that while we could form clusters based on our interests or values such as BRICS or OPEC for example, global interconnectivity and trade will remain central to the evolution of human civilization. The great convergence of East and West, North and South as advocated by Kishore Mahbubani may not be as far-fetched a vision as we may think today.

In her book Empire of Silver: A New Monetary History of China, Xu Jin argued that China's adoption of silver as in monetary tax payment in 1436 during Ming Dynasty (1368-1644) served as a catalyst for the emergence of an early form of globalized trade. On my part, I would argue that the BRI will be a catalyst for a more integrated world and more interconnected global trade instead of regionalized trade system. The BRI is simply an initiative that the world needs and will strive to make succeed.

The author is an ambassador member of Egyptian Council for Foreign Affairs and a member of Egyptian-Chinese Friendship Association. The author contributed this article to China Watch, a think tank powered by China Daily.