Globalisation In Retreat ?

Globalisation, a global phenomenon that emerged in the 1990s, has become a matter of substantial debate today. While globalisation has brought numerous benefits to areas of global cooperation and international trade, this is a reality that has caused anti-globalisation sentiments to emerge, too. This tendency has posed a serious problem in the already highly interconnected and interdependent world.

In his book titled “Globalisation and Its Discontents”, Nobel Laureate Joseph Stilgitz points out that globalisation in itself is not a bad phenomenon. According to him, the issue lies with its management. Poor management of globalisation and its unfair rules have significantly affected both the rich and the poor countries. This is quite apt in the current global scenario. Governments have emerged to play a central role in protecting domestic industries, production and employment. Countries are now trying to keep their distance from globalisation, prioritising national interests. 

Currently, the American administration is making efforts to strengthen its national economy and ensure that Americans have jobs. The USA recently imposed hefty tariffs on the products of its three prime trading partners - Canada, Mexico and China. In the case of Canada and Mexico, the US has applied a 25 per cent tariff on goods imported from those countries. Likewise, a 10 per cent tax has been imposed on Canadian energy. As of the recent development, the American administration has temporarily spared carmakers from the said tariffs. Such tariffs, in a deeply interconnected and integrated world, are bound to have profound effects on economies and the general public. 

Analysts have stated that the increased tariffs could slacken the production of certain goods, raise prices of products and potentially cause recession. As the USA is considered as the largest export market for Canada and Mexico, exports are bound to remain affected. The US has imposed a 10 per cent additional tariff on imports from China. The superpower states that such a bold action has been taken to hold the three countries accountable to stop illegal immigration and put a stop to the flow of drugs, including fentanyl, a fatal drug. The imposed tariffs have caused a surge of displeasure among these countries. As a retaliatory measure, China, Canada and Mexico have introduced their tariffs on American products. 

For instance, Canada has slapped a 25 per cent tariff on imported goods worth 155 billion dollars, beginning immediately with a list of goods priced 30 billion dollars. China, in response to the USA's tariff, countered with a 10- 15 per cent tariff on agricultural goods, coal, pick-up trucks, liquefied natural gas, etc.  As per media reports, the growing economic giant has also targeted aviation, tech and defense-based US firms with export restrictions. Imposing tariffs is a means to increase the price of the imported goods and encourage consumers to opt for domestically produced goods and services. This is a way to protect and boost the national economy. 

However, in a highly globalised world, the imposition of tariffs can trigger trade wars. This can significantly impact not just relations between countries but also affect economies and the general public. So, to get out of the intricate webs of globalisation, countries require proper planning and strategic action. It is high time the rules of globalisation be rewritten to better tackle the slumps that the majority of countries are facing. Fair rules of globalisation alone can help countries promote their national interest by benefiting from it.