The glob­al­iza­tion div­i­dend will en­dure

China Daily European Weekly - - COMMENT - The au­thor is chair­man of Eurasian Re­sources Group. The views do not nec­es­sar­ily re­flect those of China Daily.

As eco­nomic in­te­gra­tion con­tin­ues, we must strive to find new forms of in­ter­na­tional co­op­er­a­tion

Last year, Pres­i­dent Xi Jin­ping im­pressed lis­ten­ers in Davos with his out­spo­ken sup­port for free trade, in­ter­na­tional co­op­er­a­tion and open mar­kets. Since then, he has backed this with ac­tion by pledg­ing that China will keep its doors open to in­ter­na­tional in­vestors. If any­thing, his vi­sion is even more per­ti­nent to­day. Davos 2018’s sober­ing theme — “Cre­at­ing a shared fu­ture in a frac­tured world” — is, I be­lieve, bang on tar­get. The past 12 months have demon­strated a sharper per­cep­tion of in­equal­ity, both be­tween re­gions and be­tween dif­fer­ent strata of society within re­gions. Af­ter all, US Pres­i­dent Don­ald Trump’s crit­i­cism of the US po­lit­i­cal elite struck a chord that cat­a­pulted him straight into the White House.

The power of ma­jor global cor­po­ra­tions, par­tic­u­larly those ben­e­fit­ing from the net­work ef­fect, is start­ing to cause un­ease among gov­ern­ments. Con­sumers are in­creas­ingly aware of how com­pa­nies are be­hav­ing and are pre­pared to vote with their wal­lets when stan­dards — of sourc­ing, pro­duc­tion or gov­er­nance — fall be­low ex­pec­ta­tions.

So glob­al­iza­tion is un­der fire in some parts of the de­vel­oped world. This is a worry for us (Eurasian Re­sources Group), since we are a lead­ing di­ver­si­fied nat­u­ral re­sources busi­ness op­er­at­ing in 14 coun­tries on four con­ti­nents. Thank­fully, the rhetoric about the re­treat of glob­al­iza­tion isn’t matched by re­al­ity. Global eco­nomic mar­kets are still draw­ing closer. And long may this con­tinue. In the 35 years from 1980 to 2015 the num­ber of peo­ple liv­ing in ex­treme poverty fell four times faster than it had in the pre­vi­ous 150 years. While el­e­ments of the de­vel­oped world ques­tion glob­al­iza­tion, it is no­tice­able that most of the de­vel­op­ing world does what it can to em­brace the trend, know­ing it is the surest route out of poverty.

Plenty can be done to en­cour­age and fa­cil­i­tate the next phase of glob­al­iza­tion. Take the ini­tia­tives China has pi­o­neered, such as the Belt and Road Ini­tia­tive and the Asian In­fra­struc­ture In­vest­ment Bank. These could very well come to be seen as mod­ern coun­ter­parts of the fa­mous US eco­nomic ini­tia­tives post1945, such as the Mar­shall Plan and the In­ter­na­tional Mon­e­tary Fund.

The com­mon theme be­tween Davos to­day and a year ago is the drive for a shared fu­ture. Pres­i­dent Xi, speak­ing at the UN a year ago, pro­posed the con­cept of “a com­mu­nity of shared fu­ture for mankind”. Given what has hap­pened in the past year, this was highly as­tute. The chal­lenge is to turn the the­ory into prac­tice.

As eco­nomic in­te­gra­tion con­tin­ues, we must find new forms of in­ter­na­tional co­op­er­a­tion. It is hard to build in­sti­tu­tions that work across bor­ders, but it is worth it. Once in place, they tend to en­dure and prove their value over time. Busi­nesses have no choice but to be­come re­spon­si­ble global cit­i­zens. Woe be­tide the global brand that ne­glects its sup­ply chain and is dis­cov­ered to be ex­ploit­ing work­ers in dan­ger­ous, sweat­shop con­di­tions thou­sands of miles from its prin­ci­pal mar­kets. They will quickly learn the cost of be­tray­ing con­sumer trust.

We need more cross-in­dus­try co­op­er­a­tion to cre­ate a world where ev­ery­one en­joys the fruits of glob­al­iza­tion. Davos can help en­cour­age that. It is also pleas­ing to see how the Davos plan­ners have this year seen fit to in­clude ses­sions cov­er­ing thorny top­ics such as im­mi­gra­tion, priv­i­lege, ha­rass­ment and race.

The big sub­jects this year are still mat­ters of world trade. Look­ing ahead, it is plain to me that here China has a tan­gi­ble ad­van­tage over much of the de­vel­oped world. The United States is in­creas­ingly in­ward-look­ing. Europe still grap­ples with dis­agree­ments over the speed of in­te­gra­tion of the Euro­pean project, while one of its big­gest mem­bers, the United King­dom, leaves com­pletely.

China’s pace of de­liv­ery is im­pres­sive. Once a course of ac­tion is de­cided upon, things hap­pen fast. In the past 12 months, huge strides have been made in poverty re­duc­tion and en­vi­ron­men­tal pro­tec­tion. The task of en­sur­ing that growth ben­e­fits more peo­ple runs through the pol­icy ini­tia­tives.

We are also see­ing global lead­er­ship from China. The ef­forts made to com­mu­ni­cate its growth plans and how these will ben­e­fit the world econ­omy are a good ex­am­ple. The Belt and Road Ini­tia­tive fur­nishes China with the op­por­tu­nity to be­come a leader in trans­form­ing the economies of Cen­tral Asia, Africa and Latin Amer­ica. Sure, no ma­jor de­vel­op­ment in his­tory like this comes with­out dif­fi­cul­ties. Eco­nomic and po­lit­i­cal con­di­tions vary greatly across dif­fer­ent coun­tries and ju­ris­dic­tions, and these will no doubt bring le­gal and fi­nan­cial chal­lenges in their wake. How­ever, a wide­spread de­ter­mi­na­tion to suc­ceed, care­ful plan­ning and reg­u­lar on-the-ground con­sul­ta­tion should mit­i­gate these risks.

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