When we talk about economic development, we often start with Adam Smith’s The Wealth of Nations, which explains modern economic growth. According to Adam Smith’s economic growth theory, individuals have a rational proclivity to maximize wealth. To make this process of individual self-maximization and subsequent market growth viable, Smith argues, individual self-maximization and subsequent market growth can happen. According to Smith, there should be no force, not even state intervention, disrupting the market, since intervention would only harm the market. Smith ‘s economic growth happens when the “invisible hand,” the unobservable market force, helps the demand and supply of goods in a free market to reach equilibrium automatically.Asian economies that were under the influence of Communist regimes during the Cold War, and that are still governed by Communist regimes, are now the number one defenders of globalization and free global trade, whereas Western countries, which had been the champion of liberalization are now raising their voices for protectionism. The European Projects was supposed to be a civilization project, but now they are almost on the verge of collapse. The great world civilizations used to have separate identities; now they have increasingly overlapping commonality, that is, becoming a global community. Everyone around the world has the same aspirations as the people who live in the West or in the Untied States. They want their kids to have a good education, obtain better jobs, and live in peaceful communities. Granted, they have gone about obtaining those goals in different ways.
In the West, last week Britain officially starting its divorce process with the European Union in what is referred to as “Brexit.” The West is a big mess from human rights violations to controls on freedom of expression, from a refugee crisis to economic problems, and from social ills to fundamentalism. It is not a secret anymore that the West deeply fears the encroachment of the Islamic world, which has almost led to being hardwired into the body politics of the Western world.
The classical example is that they would not allow those of Turkish origin who live in the Netherlands or in Germany to protest in Holland, in Germany, or in other countries and instead, put a ban on political campaigning. Even the EU’s parliament wanted to ban its Turkish daily newspaper. It is true that there has been a significant increase of terrorism perpetrated by those from the Muslim world. That combined with the massive influx of refugees has caused the West to tap into a deep lode of anxiety about Islam in the West. Western leaders need to make an intellectual pilgrimage to South East Asia to see different cultures live in peace and progress together. Also, the majority of Muslims live in Asia not the Middle East. While Israel and Palestine keep fighting, Malaysia and Singapore manage to live in peace since they divorced in 1965, perhaps having less deep divides; the 60th anniversary of the historic agreement for the EU was celebrated in Rome with a broken heart.
The mood of the global world theses days is not very good. There is turmoil in Syria and Iraq, resulting in thousands of deaths, in millions of refugees, in increased terrorism, in geopolitical tensions in Eastern Europe with Russia, and in economic stagnation in Europe. The future is no longer for the West to decide. Over fifty years ago, a Christian Filipino leader, a Buddhist leader, two Muslims leaders, and Hindu leaders got together to form the Association of Southeast Asian Nations (ASEAN) and to bring peace and prosperity to the region with the intent of acting as one nation.
The rapid economic growth in Asia, such as in China, South Korea, Taiwan, and the Philippines seems to contradict Smith’s theory. It turns out that Asian values have made the region fertile grounds for global capitalism, the place where the potential risks of the new world order are taking place. The global economy no longer depends on the West nor on the United States as many dependency theorists had argued. On the contrary, it was not the invisible hand of the market that caused the rapid growth in some of the Asian countries but rather the visible hand of the state, which directed the flow of capital to the industries; the state, though, would be more successful. While the EU countries are celebrating the 60th year of the Treaty of Rome that carried the union to where it is today, the Philippines is hosting the 50th ASEAN summit in 2017, in Davao City, presenting a totally different picture. It works together to advance economic globalization, partnering for change, and engaging the world to advance economic globalization. The aim of the Summit is to deepen and advance the economic changes and the coordination and cooperation among Asian nations, as well as between Asia and different regions of the world. Opposing globalization and arguing for the rise in protectionism, governments and businesses of different Western countries seemingly were called upon to stay loyal to the principles of free market, inclusive growth, and economic cooperation.
Asia also held the Boao Forum for Asia Annual Conference 2017, in China’s Hainan Province. The declaration of the forum emphasized that some countries should boost their reform efforts to strengthen the international economic order and global governance system and that the determined policies should guarantee the common interests of countries. Trade protectionism should be rejected because trade and investments drive sustainable global development. The forum argued that international organizations such as IMF, WB, WTO, and APEC should work together to build a more open, inclusive, and fair bilateral trade system. In a word, a pro-globalization initiative was proposed.
Protectionism can be a lousy idea depending on what country is involved and the way that country sets up policies. However, the cooperation efforts of a rising Asia with the rest of the world will be a new stepping-stone for a reformed world order.
Dr. Aland Mizell is President of the MCI and a regular contributor to Mindanao Times. You may email the author at:aland_mizell2@hotmail.com
