Mains Practice Questions

Approach

• Give brief introduction of the Brexit and USA’ withdrawal from TPP.
• Describe the reasons for declining global cooperation and increasing national identities.
• Give conclusion and way forward by underling the possible loss due to these developments.

Introduction

• The current political environment reflects a significant counter trend to globalization. Instead of being broken down, national borders are being reinforced. UK’s exit from European Union, USA’s withdrawal from TPP represent a shift away from globalization.
• Brexit and Trump’s protectionist agenda are a global trend towards bilateral trade agreements eschewing the multilateral FTA agreements and WTO mechanism.

Body

Reasons for resistance towards regional cooperation and bolstering National Identities

• Immigration: Perception regarding immigrants cornering the local jobs been rising in Europe as well as USA.
• Populist leadership: Brexit represents the widespread rise of right-wing parties which pander towards protectioism and deglobalisation, harping on insecurities of masses. For instance, in USA Trump led an overt campaign using national sentiment by using ‘America First’ and in the process ridiculing global regional cooperation as well as undermining institution like WTO, UN etc.
• Global events: In last two decades the geopolitical events like World trade center terrorist attack in 2002, political turmoil in Middle East, emergence of ISIS, growing incidence of mistrust between Iran and USA has caused damage to globalization sentiments to some extent. Post 2002 attacks in USA and arrival of mass refugee from Syria in European nations, there is negative sentiments for global and regional cooperation.
• Competitive Trade Policy: US has circumvented the WTO to impose tariffs on steel and aluminum imports, including those from America’s allies. Complaining of unfair treatment, the administration is blocking nominations to seats on the WTO’s appellate body, which could leave it unable to hear cases after 2019. Most ominously, America is embroiled in a trade war with China. Both sides have imposed tariffs on goods worth tens of billions of dollars thus in effect undermining WTO and multilateralism and reversing global and regional cooperation through global institutions.

Conclusion

• Quitting of regional and multilateral agreements by US harms global economy and US itself. Its companies end up paying higher tariffs than their competitors, its negotiators have less power to shape the norms, standards, and arrangements that increasingly define global commerce. Similarly, Brexit will cast shadow on London being world’s financial center.
• Regional cooperation and multilateralism are the pillars on which modern world order is built. Without global free flow of trade and information there will be much to lose for both developed and developing countries.