When Emerging Markets Lead the Way (Part VII)

How can better global governance foster more inclusive national democracies?

October 5, 2009

How can better global governance foster more inclusive national democracies?

Long before the current global financial crisis precipitated things, Brazil and other emerging economies had decided not to sit on their hands in the face of stubborn resistance to reforming global institutions.

Developed countries, especially in Europe, are understandably loath to give up their seats at some of the top tables.

In an ever more complex and fragmented environment, whatever modicum of progress that has been achieved is largely centered in areas where specific coalitions of like-minded developing countries have been able to work together.

They did so on the basis of clearly honed agendas — and with clear-cut goals. This radically different form of the "coalition of the willing" focuses on rebuilding rather than subverting multilateral institutions.

The G-20 that arose within the World Trade Organization in 2003 was a major sign of things to come. It ensured that at the very least no further trade-distorting agreements would be foisted on farmers in the developing world.

Piecemeal review of intellectual property issues has helped reduce the likelihood of patent rights and the accruing profits of pharmaceuticals trumping public welfare policy and general access to cheap generic drugs in poor countries.

As a result of this growing clout, emerging countries — meeting as the BRICs or as the G-5 — have come into their own.

Through the G-8 Outreach Forum — and most importantly the G-20 financial summits — they have been actively engaged for the first time in helping to mold the collective response to the global downturn.

What is more important, they are doing so in a manner that rejects putting the burden of adjustment primarily on the developing world.

Yet, global democracy is more than offering a handful of emerging economic powerhouses a greater say. If public opinion and leaders in the rest of the Global South are to put their faith in global governance, they must also have a meaningful stake in the outcome.

How are these voices going to make themselves heard? For example, trade, finance and infrastructure projects geared to overcoming regional disparities, as developed in South America, have provided a useful soundingboard for innovative proposals to be presented at the G-20 or G-8 Outreach.

In addition, Brazil has sponsored the first large international meetings in recent memory outside of the regular schedule of the United Nations, aimed at bringing together large and important blocks of developing countries.

The South American-Africa Summits — held in Abuja in 2005 and in Caracas in 2009 — and the South America-Arab Countries Summits, held in Brasilia in 2006 and in Abu Dhabi in 2009, set up transatlantic partnerships spanning major geographical, cultural and political divides. These helped to reinforce a sense of common purpose and forged commitment.

Just as important, a shared belief in open and sound government is behind the India, Brazil and South Africa Forum (IBSA). It provides a platform for three major democracies in the developing world, with leadership credentials in their respective regions, to work together on a wide range of economic development issues.

IBSA has set up a fund to identify and finance good practices in education, health and basic sanitation projects in needy countries. There can be no better advertisement for how democracy at the domestic and global levels can work in unison.

In conclusion

In conclusion, we live in a time of discarded myths and shifting paradigms. Grassroots democracy is both a symptom of and a possible remedy for the ills of globalization.

More democracy on the global scene can embolden democratic trends locally. By giving a greater voice to individual countries and regional blocks, a larger degree of public policy space is opened for strategies and policies catering to domestic needs and individual aspirations.

If globalization can thus be reformed, then just maybe there is hope for reforming capitalism as well. In this endeavor regional integration and innovative South-South coalitions can play a major role.

It is not without significance that the most radically nationalistic Latin American nations — Bolivia, Ecuador, Nicaragua and Venezuela — are also those with the greatest enthusiasm for the supranational agenda.

As has been suggested above, weak national institutions and inadequate machinery of government, especially in the Andean region, are major hurdles to enabling democracy to tame capitalism. This makes regional integration schemes, under the wing of more advanced neighbors, an attractive proposition.

None of this is a substitute for a robust democracy born of macroeconomic stability and social solidarity. Nor is this to deny the countervailing forces of ethnic and nationalistic pride, as well as of xenophobic resistance.

It does, however, suggest that effective global governance can be a powerful ally in bringing to fruition the promise of grassroots democracy. By working together, developing countries can hope to bring about fundamental change in how global capitalism works. Such innovative coalitions can help cut the Gordian knot of economic development.

The key question we have to answer is this: Is it poverty that holds back democracy? Or is it suspicion of democracy and impatience with its slow rule-bound procedures that perpetuates poverty and inequality?

Brazil provides a cautionary tale. A quarter century of mediocre growth and social malaise running through much of the 1980s and 1990s has helped disabuse Brazilians of the ingrained belief — popularized in the national anthem — that the country's geographic size, demographic dynamism and rush to exploit its natural endowments predestined it for greatness almost despite itself.

That this local version of "manifest destiny" remains unfulfilled, the story goes, is the fault of an unholy alliance of corrupt officials, parasitic elites and rapacious foreign interests intent on snatching Brazil's passport to prosperity — its immense mineral and agricultural wealth.

The inherent value found in political maturity, economic consistency and regional integration is understood to be the ultimate assurance that this natural heritage will be translated into sustainable growth and social justice.

Other more precious endowments — such as a rich cultural diversity, a mature democracy and religious and ethnic tolerance — are seen as Brazil's true comparative advantages in a time of global interdependence.

Brazil's call for a "new global economic and trade order" mirrors the country's renewed self-confidence as a non-conformist power. It doesn't seek simply to take up a place at the top table. Rather, it is confident in its strength as a consensus-builder within the South and bridge-builder to the North.

The innovative coalitions described offer the possibility of developing and developed countries working together to bring about fundamental change in how global capitalism works.

The premise is the transformative power of a more democratic world society. Globalization has not so much eroded the leadership role of the industrialized North as added new actors to the decision-making mix, in particular emerging economies as well as non-state agents.

The birth pangs of this new governance model are uncertain and often haphazard. The search is on for a dialogue format that allows mutual dependence to work for the collective welfare, rather than as a pretext to seek one-sided gain.

The way is open to bring to life a widely spread networking platform — a truly global "axis of good" — that helps bring actors together around a reformed multilateral system. From this hopeful vantage point, let its specter continue to haunt the world!

Editor’s Note: This is the conclusion of a seven-part series. Read Part VI of this Globalist Paper here.

Takeaways

We live in a time of discarded myths and shifting paradigms. Grassroots democracy is both a symptom of and a possible remedy for the ills of globalization.

The most radically nationalistic Latin American nations — Bolivia, Ecuador, Nicaragua and Venezuela — are also those with the greatest enthusiasm for the supranational agenda.

Globalization has not so much eroded the leadership role of the industrialized North as added new actors to the decision-making mix.

The South American-Africa Summits and the South America-Arab Countries Summits set up transatlantic partnerships spanning major geographical, cultural and political divides.

Global democracy is more than offering a handful of emerging economic powerhouses a greater say.