After the upheavals of the Covid-19 pandemic and the Russo-Ukraine conflict, many experts, mostly economists, announced the demise of globalization. Some scholars coined the term "deglobalization," and economic nationalism was back in vogue. The disruptions in supply chains during the pandemic certainly made it seem that way. However, as the post-pandemic world gradually restored supply chains and economic growth, new concepts began to emerge.
In January 2023, Columbia University historian Adam Tooze introduced the idea of a "cocktail of globalizations" at the World Economic Forum. In the same year, economist Mohamed A El-Erian proposed the term "fragmented globalization" in a Project Syndicate article.
The term "fragmented" carries a negative connotation and suggests failure. Did globalization fragment because its core couldn't hold? I suggest a different term to describe the current global landscape: "Decentred globalization."
This should not be confused with “decentralized globalization,” which has a positive connotation and implies a deliberate shift from centralization. Decentring implies a challenge to the existing order of globalization, particularly where a handful of countries, often referred to as the Global North or the G7, play a dominant role. The world's economy is not integrating as many proponents of economic globalization had hoped.
For those who may not be interested in the intricacies of globalization theories but prefer concrete evidence, consider the proliferation of economic blocs worldwide.
In recent months and weeks, we've witnessed meetings like ASEAN+ in Jakarta, BRICS in South Africa, G20 in India, and a gathering of the Group of 77, a diverse group of 134 developing countries plus China, in Havana. Some countries are members of multiple groups, which reflects the shift from centralized to decentred globalization.
Let's rewind to the world before the end of the Cold War, around 1990. The Bretton Woods Institutions existed: The World Bank (officially known as the International Bank for Reconstruction and Development, or IBRD), established primarily to rebuild war-torn Europe, and the IMF, a sister organization, handling financial assistance to struggling countries.
The third entity, the International Trade Organization (ITO), was intended to regulate global trade but faced opposition from the US Congress. Instead, the General Agreement on Tariffs and Trade (GATT) was created in 1947, with 23 original signatories, including China.
The rules of international trade required extensive consultations, especially as nations at various stages of economic development needed to manage their imports and exports to support their industries. Questions arose about the fairness of state subsidies for fledgling industries, sparking discussions and disagreements. By its final year in 1994, GATT had 128 members, and in 1995, it evolved into the World Trade Organization (WTO).
The G20 was established in 1999, following the 1998 economic crisis, when global economic leaders recognized the inadequacy of the G7 (or the Organization for Economic Cooperation and Development, OECD) in addressing global economic issues. They believed that a more inclusive group, including some Global South members like Saudi Arabia, India, China, and Russia, should be part of global economic discussions.
This marked a shift toward a global approach to tackling worldwide challenges, a shift that bore fruit during the 2008-2009 financial crisis when it became evident that individual countries were ill-equipped to address such challenges.
BRICS emerged in 2009, representing Brazil, Russia, India, and China (with the "s" indicating plurality). In 2001, Russia's GDP in Purchasing Power Parity (PPP) terms stood at $1.12 trillion, ranking it as the world's 10th largest economy, while Brazil, with $1.21 trillion in PPP terms, held the 9th spot. Brazil had overcome runaway inflation in the mid-1990s when sociologist F H Cardoso served as finance minister and successfully tackled hyperinflation. South Africa joined the group later, transforming "BRICs" into "BRICS," a term coined by Goldman Sachs economist Jim O’Neill.
In India, intellectual politicians such as Jairam Ramesh have been a protagonist of closer ties between China and India to the extent that Ramesh formulated the term “Chindia” in 2005. Jairam Ramesh was a member of Dr Manmohan Singh’s team when Singh was the finance minister under whose watch economic reforms began in India. He was also adviser to Finance Minister P Chidambaram in the early 1990s.
BRICS established the New Development Bank in 2015, and the following year saw the founding of the Asian Infrastructure Investment Bank (AIIB) in Beijing, with 57 founding members, including Bangladesh. AIIB aimed to balance the dominance of institutions like the World Bank and the Asian Development Bank in providing financial assistance to developing countries.
Today, AIIB boasts 109 members, representing 81% of the global population, with Bangladesh as one of its founding members. In addition to the five founding members of BRICS, Bangladesh, the United Arab Emirates, and Egypt have joined the New Development Bank. BRICS has invited six new members: Argentina, Egypt, Iran, Saudi Arabia, and the United Arab Emirates to join this bloc next year.
Bangladesh has adeptly navigated its alliances within this decentred globalization, positioning itself well in this evolving global landscape.
Habibul Haque Khondker is a sociology professor at Zayed University, Abu Dhabi who previously taught at the National University of Singapore.