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2017 a year of Transition from Globalization to Economic Nationalism

2 January 2017 12:05 am - 0     - {{hitsCtrl.values.hits}}

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Years come and go and likewise time passes through our civilizations adding things to history. The New Year which arrived on January 1, 2017 will not be an ordinary year for mankind in many aspects. 
This is a year of transition and ideological conflict because of Globalization Vs Nationalism, International conventions Vs interest of Nation State, Free trade Vs Protectionism, Secularism Vs Religious fundamentalism, Universal values Vs National values. This will create a new era of economic nationalism, and not merely a beginning of another year. It will be an opening of a new era of nationalism in place of globalization. There will be many conflicts of ideas and actions by different States.  
This is going to be a new era which will change the entire geo-political structure of the world. Many scholars may give different names and interpretations to this era such as new nationalism, protectionism or economic nationalism. With the growing religious ideologies some academics might argue that this will be a religious (Christian) nationalism. Whatever the interpretation this will definitely be the beginning of an era of many ideological differences among nations based on the religious and racial identities leading to ultra-nationalism among nations.  
It is interesting to define the concept of nationalism. Different scholars have given different definitions and explanations in regard to nationalism. In its basic form nationalism is a collective social thought. It demands the freedom from universal global nationalism. This concept contemplates that the foundation of the human society is the nation State. This comprises a collective language, economics, and socio cultural entity, which will be given by a state mechanism and is called the concept of Nation as a result of these conceptualizations.   
Thereafter the supremacy of the human race was established and it was unquestionable that humans can suppress all other living beings including animals, flora and fauna on the planet.  
When nationalism surfaced in those countries, individual nations began to think each one of them was superior to other nations. As an example, manifestation of State ideology, development of Aryanism as a racial dogma in Germany, growth of Anglo-Saxon ideology and Nazi and occupations based on the religious ideological concepts acted on the belief that there was a targeted select group of people to spread their religious beliefs by force or any other means.  
Via religious fundamentalism, countries such as Israel, Iran and Saudi Arabia are predominantly fuelling this ideology to name a few. In contrast to this religion fundamentalism a class concept based on the productivity process has come into focus which is on the premise that it is the division of labour which drives society and its civilization progressively.  
It is thought-provoking to study the recent history related to the concept of nationalism. A significant phenomenon occurred after the Second World War in the western world through the Bretton Woods Conference which created a global system of monetary management. This was established to cater for the rules for commercial and financial relations mostly among the western nations. As this system of economic activities around the world was developed, subsequently a general orientation towards a strong market based approach which we called market fundamentalism or neo-liberalism through the Washington Consensus was created especially after 1990. This economic globalization was primarily aimed at opening markets of developing countries to the global market. This is mainly to control and direct the world economy through the instrument of free trade.  
To strengthen and establish the economic and social globalization more and more market-based mechanisms were to be established in the world. This was amply supported by the World Bank, IMF,WTO and also to a certain extent some UN mechanisms through many multilateral agreements and covenants.  

 

"To strengthen and establish the economic and social globalization more and more market-based mechanisms were to be established in the world"


On the other hand, the Soviet Economic System was the direct challenge to this market-based economic system which was successfully defeated through military invasions, military coups, and economic sanctions and many more clandestine socio economic strategies used by the capitalistic forces. In doing so the western political leadership was on the premise that there was one solitary universal value system for the entire world irrespective of geographical, racial, ideological, religious and cultural differences among different nations and ethnic groups.   
After the collapse of the Soviet Union in 1990, Francis Fukuyama in his famous book “The End of History and the Last Man (1992)” argued that the liberal democracies and free market capitalism of the west and its life style signalled the end point of humanity’s sociocultural evolution without any confrontation. He predicted that this as the Universal Value System acceptable to all and there would not be any further evolution in the global socio economic evolution.  
On the other hand an entire opposite hypothesis is developed by Samuel Huntington who defines, that the conflict between the socialism, communism and the market based capitalism conflict is now over and there will be a new clash among civilizations. Accordingly, he predicted that religious fundamentalism would grow among and within that nation States especially there would be clashes among Christianity and Islamic fundamentalism beyond nation States.  
With recent happenings in the global geopolitical scenario, most of the old concepts have been rejected resulting in an entire new paradigm shift towards individual nations States. The oil crisis occurred in 2008 and the world financial crisis that has occurred during the same period and the Islamic terrorist attacks targeting the western world are not isolated incidents but connected to each other in many ways. This was fuelled by the prediction of the Islamic population exceeding the Christian population and China expecting to be the world’s economic super power by 2020.  
Parallel to these drastic changes in the global economic context, China becoming the military super power of the world will be unstoppable and unavoidable. Corresponding to this phenomena there would be many more retrenchments and lost opportunities for the workforce and the business community in the developed world as a result of low cost and inexpensive Chinese products.  
The loss of opportunities and worsening of financial stability in the western world has created the ideal breeding ground to surface the contemporary nationalistic phenomena in their countries. Therefore, once again based on the foundation of nationalism or national States a socio economic action is in need for political enterprises. As a result we can see the surfacing of politicians like Nigel Farage in Britain, Mori Lupe in France, Marcus Pretzell in Germany, Trump Phenomena in US, Pauline Hanson in Australia to name a few. In the US it is noteworthy to observe that a powerful section of the Republican Party that believes in this fundamentalist ideology has surfaced predominantly giving dangerous signals to the entire world. All these people and movements were called Alt-right nationalists with far right ideologies based on white supremacist and nationalism. They believe that their white identity is under attack by various multicultural forces and different identities.  
As a result a new nationalism is immensely developing among the western nations. Once again national identity, national economy, protective market polices, and social values based on one’s national identity are resurrecting their importance especially among the predominantly white nations. Originally as small groups but now with the spread of their ideology in a significant way slowly but steadily these movements are clutching the key political parties in their own countries. The emergence of Trump phenomena is not an isolated incident but as a result of these changes in the global social equilibrium.   

 

"With recent happenings in the global geopolitical scenario, most of the old concepts have been rejected resulting in an entire new paradigm shift towards individual nations States"


During the year 2016, a decisive political phenomenon occurred in the West. Most people identified this as a far right wing movement. However, when we look at this socio political phenomena it was obvious that the real background to this phenomena consists of labourers and the working class in those countries who were frustrated for many years. Therefore, these phenomena occurred not just only for one reason but as a result of many complex multidimensional reasons. This phenomenon will progress further in the year 2017 and may be in a more proactive way.  
We, as a country, should look at the options left for our country to progress through this uncertain period. In the Sri Lankan context, Sri Lanka’s current strategy is to sustain and enhance further our products and services to the western markets and to attract more foreign direct investment especially from the western world and China.  
However, due to the neo-nationalism and protectionism now surfacing in their own countries, at the end of the day the developed world will tend to produce their own products and services within their countries. This will create additional restrictions on our export products.  
It is prudent and necessary for us to find new markets and opportunities for our products and services. To aggravate this situation further western nations will tend to invest within their own countries to protect their job opportunities and markets. It is evident that Trump will aim to promote coal power generation resulting in drastic global environmental consequences. Learning from this western world will tend to disregard the international conventions for climate change especially the Paris Agreement. They will also violate more openly the human rights, disregard defence treaties such as NATO, economic partnerships and the  Transatlantic Trade and Investment Partnership (TTIP), Trans Pacific Partnership (TPP) etc.  
In view of this we need to find new strategies for novel markets and opportunities especially among the Asian nations. This may be through bilateral agreements and regional groupings for new export markets. Another area which needs our attention would be the import substitution strategy to protect and develop domestic production.  
The ever escalating trade war between US and China will make huge changes in the global market scenario pivoting the power equation towards China. Therefore, we need to focus and adjust our economic strategies to face this global changes and challenges.  
We cannot wait any longer for traditional way of attracting Foreign Direct Investment and opening of foreign markets for our products. We need to enter into a new set of economic strategies and activities.  

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