Dear Editor,
The International Economic Order is seriously shaking up and getting ready for a complete overhaul. The signs of this became apparent this week when the world's leading emerging markets Brazil, Russia, India, China and South Africa had what some deem as the audacity to openly challenge the existing status quo, announcing that they are going to form their own versions of the International Monetary Fund (IMF) called the New Development Bank (NDB).
The NDB will be set up to help these nations and other emerging markets pursue regional trade, investment and infrastructure development, domestic job creation, and poverty reduction. What makes this institution unique is that it has absolutely no ties to any of the major Western powers, but is built specifically with the concerns of developing countries in mind -- or at least that's what they claim.
The BRICS have not been shy to point out that structural adjustment programmes have not always worked, given it's "one size fits all" approach, which is impossible to do because every country is inherently different; it's problems are different; and thus the solutions should be just as varied.
Anyone who has been following the trend of the world economy lately should not at all be surprised that this has come to pass -- truth be told the writing was already on the wall. China is predicted to take over from the US as the world's most powerful economy, while Russia and India don't seem very far behind, issues that are of importance to the international political economy have moved from discussions at G7/G8 to summits for the G20, which includes all the BRICS countries. The US, Japan, and western Europe, whose economic supremacy once went unchecked and unchallenged, are now facing stiff competition from these new players, particularly China -- no doubt soon to become the new manufacturing capital of the world.
The formation of NDB is far more than just an economic statement. More importantly, it is a political statement after years of simply undermining the existing politico-economic order as established by the Bretton Woods system. They've now decided to openly defy the status quo for all the world to see, knowing full well that there's not a single thing the West can do in a pushback against this challenge to supremacy. This is a war of words, a war of ideas, a battle for control of the world's economy, and the US and company are sorely loosing.
Of course all this could simply be my speculating. Maybe the US and its allies don't really see it as a threat. Maybe they have no ill feelings toward the establishment of this new BRICS-owned entity that they cannot control like they have been doing with similar institutions for the last 70 odd years. But one thing is certain, there was a time when no nation (or alliance of nations) would ever dare to try something like this. But times have certainly changed, and soon developing countries will be signing up, given their disillusion with institutions such as the IMF and the World Bank which they don't see as acting in their best interest.
The implications are numerous as far the setting up of the NDB is concerned, as is the implications of how it will be received, which right now borders on cautious optimism. Very little is certain, but one thing that is certain, however, is that the influence of the traditional powers is significantly waning, thus making way for a new world order.
Jason Green
sirj_green@hotmail.com
BRICS could create a new world order
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The International Economic Order is seriously shaking up and getting ready for a complete overhaul. The signs of this became apparent this week when the world's leading emerging markets Brazil, Russia, India, China and South Africa had what some deem as the audacity to openly challenge the existing status quo, announcing that they are going to form their own versions of the International Monetary Fund (IMF) called the New Development Bank (NDB).
The NDB will be set up to help these nations and other emerging markets pursue regional trade, investment and infrastructure development, domestic job creation, and poverty reduction. What makes this institution unique is that it has absolutely no ties to any of the major Western powers, but is built specifically with the concerns of developing countries in mind -- or at least that's what they claim.
The BRICS have not been shy to point out that structural adjustment programmes have not always worked, given it's "one size fits all" approach, which is impossible to do because every country is inherently different; it's problems are different; and thus the solutions should be just as varied.
Anyone who has been following the trend of the world economy lately should not at all be surprised that this has come to pass -- truth be told the writing was already on the wall. China is predicted to take over from the US as the world's most powerful economy, while Russia and India don't seem very far behind, issues that are of importance to the international political economy have moved from discussions at G7/G8 to summits for the G20, which includes all the BRICS countries. The US, Japan, and western Europe, whose economic supremacy once went unchecked and unchallenged, are now facing stiff competition from these new players, particularly China -- no doubt soon to become the new manufacturing capital of the world.
The formation of NDB is far more than just an economic statement. More importantly, it is a political statement after years of simply undermining the existing politico-economic order as established by the Bretton Woods system. They've now decided to openly defy the status quo for all the world to see, knowing full well that there's not a single thing the West can do in a pushback against this challenge to supremacy. This is a war of words, a war of ideas, a battle for control of the world's economy, and the US and company are sorely loosing.
Of course all this could simply be my speculating. Maybe the US and its allies don't really see it as a threat. Maybe they have no ill feelings toward the establishment of this new BRICS-owned entity that they cannot control like they have been doing with similar institutions for the last 70 odd years. But one thing is certain, there was a time when no nation (or alliance of nations) would ever dare to try something like this. But times have certainly changed, and soon developing countries will be signing up, given their disillusion with institutions such as the IMF and the World Bank which they don't see as acting in their best interest.
The implications are numerous as far the setting up of the NDB is concerned, as is the implications of how it will be received, which right now borders on cautious optimism. Very little is certain, but one thing that is certain, however, is that the influence of the traditional powers is significantly waning, thus making way for a new world order.
Jason Green
sirj_green@hotmail.com
BRICS could create a new world order
-->