Magazine article New Internationalist

Deglobalization - Reflections of a Filipino MP

Magazine article New Internationalist

Deglobalization - Reflections of a Filipino MP

Article excerpt

Over the last two years the international financial crisis has deepened into a crisis of the real economy. With the collapse of demand in the US and other markets in the North, the export-oriented economy - the 'globalized' model that has reigned for the past 30 years - has begun to unravel.

This has brought stagnation and recession to the model's most successful examples: the economies of East Asia. Singapore's economy is expected to have contracted by two per cent in 2009; South Korea, the 'Asian Tiger' par excellence, to register zero growth. Japan has not snapped out of nearly two decades of stagnation. In China, millions of jobs in export-oriented industries continue to be lost, even as the economy is said to be on the path to economic recovery.

According to the Economist: 'The integration of the world economy is in retreat on almost every front.' While the magazine, one of the prime avatars of neoliberal globalization, says that corporations continue to believe in the efficiency of global supply chains, 'like any chain, these are only as strong as their weakest link. A danger point will come if firms decide that this way of organizing production has had its day.'

In response to the collapse of the export-oriented global economy, many governments have fallen back on their domestic markets, revving them up via stimulus programmes that put spending money into the hands of consumers. But instead of an opportunity to strike out on a different economic path, many governments see only a temporary expethent, to be abandoned once demand in export markets picks up again.

Daunting challenge

Why do illusions persist? And why the continuing resistance to alternative paradigms, like deglobalization, when this should be a time for thinking outside the box?

The daunting challenge of translating the guiding principles of the alternative into reality is part of the problem. In a place like the Philippines the starting point appears very unfavourable. Thirty years of structural adjustment have de-industrialized the country, with textile and garment firms, for instance, reduced from 200 in the 1970s to 10 today. World Trade Organization-imposed liberalization has converted the country from a net food-exporting country into a net food-importing one. The main pillar of the economy is now the export of labour, with some 10 per cent of the country's 90 million people working and living outside the country.

There is, in short, no tabula rasa, no virgin soil on which one can impose blueprints.

Moreover, the blocks to transformation are not only material but ideological. True, the recent collapse of the global economy has eroded the credibility of the neoliberal economics that provided its intellectual underpinnings. Nevertheless, neoliberalism continues to exercise a strong influence on economists and technocrats.

For instance, at the recent hearings on the budget at the Philippine House of Representatives that I, as an MP, participated in, trade liberalization was defended as leading to greater competitiveness'. Raising the prospect of renegotiating our foreign debt was discouraged because it would allegedly give us a bad name in global capital markets. Globalization continued to be extolled as the wave of the future.

Why this continuing invocation of neoliberal mantras, when the promise of neoliberalism has been contradicted by reality at almost every turn? …

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