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Wednesday, March 21, 2018

Asia and Africa demanded from the West a complete overhaul of the world economy

At the summit in Jakarta of the country of Asia and Africa demanded “justice for all Nations”, as “global imbalances is becoming more and more suffocating”. In fact “third world countries” took a swing at creating a new economic world order in which the West will not be able to fatten at the expense of the East and South. Of course, the opposition from the West will be enormous.

At the end on the eve of the summit of leaders of the countries of Asia and Africa, which was attended by delegations from almost 100 States and 17 international organizations, adopted by consensus the outcome document of the three – Bandung message, Declaration on the revival of the new Asian-African strategic partnership and a Declaration on Palestine. The main theme of the Jakarta conference was “Strengthening cooperation “South – South” to promote global peace and prosperity”.

“North” against “South”

“In the United States in the last three decades, real wages have remained at the same level even in absolute terms”

Already the whole of Asia and all of Africa speak of the confrontation between the global South and global North that has become more urgent after the United States failed to get the whole world to buy your crisis. Including this is manifested in deep structural decline of modern capitalism generated the so-called new globalization. Developing countries are sensitive to the prevailing international economic order, considering that the international financial institutions (IMF, world Bank, international Finance Corporation) have actually become for them an instrument of coercion a policy which serves the interests of developed countries. The West began to reconsider basic provisions of the “Washington consensus” on the nature of economic growth, and in the framework of the new discourse of Africa, for example, is not seen as a subject of world politics, and how its object – especially in light of the rapid development of Sino-African relations.

In fact, in the old days the first (colonial) globalization has created a global exchange of goods, capital, Western countries have not moved from the global “North” to the global “South”, although formally it had no legal restrictions. Investments were only in mining, plantations and estates, export activities and necessary for their infrastructure – ports and Railways (where profits were guaranteed by the colonial state).

Under the rule of liberal economic policies migration of capital in the manufacturing sector “South” actually was not, even despite the low wages there. “The invisible hand of the market” (it is known from experience, not from books of IMF economists) did not work, as, indeed, almost everywhere and almost always. Just look at modern Europe: industry of Bulgaria and Greece destroyed, people are willing to work for low wages, but the capital there from Germany or France is not.

Is the process “new globalization” has changed the situation. The capital from the “North” and “West” was freely poured on the “South” and “East”, creating export-oriented production. However, this gave rise to high unemployment and jeopardize the income of workers in developed countries (which, among other things, leads to a relative reduction of the “Northern” and “Western” markets). As says the famous Indian economist Prabhat Patnaik, in the United States in the last three decades, real wages have remained at the same level even in absolute terms.

Worse, the “North” is already openly trying to undermine the sovereignty of developing States over their natural resources based on the fact that some countries have great natural resources, but to effectively dispose of them supposedly can’t. And “humanity”, which implicitly refers to the rich West (“the mission of the white man”), is obliged to establish “effective control” over the natural resources of those countries which are not able to learn them (well, or the pace of development of these resources is not satisfied with the “mankind”).

The results are evident: during a TRANS-African famine of the ’80s and’ 90s, spawned by the “great drought” – a terrible drought affecting almost the entire continent and led to a terrible civil war, the Western countries tried to link food aid with liberal reforms on the patterns of IMF. Eventually the drought ended, and Africa even more impoverished.

In his speech at the summit, the host – President of Indonesia Joko Widodo, having consequences for the “South” from the dictates of the North, demanded reform of global financial architecture “to prevent the domination of some countries over others”. “The opinion that the economic problems of the world can be solved only by the world Bank, the International monetary Fund and the Asian development Bank, have become obsolete. We must build a new world economic order, which will be open to new emerging economic powers,” he declared.

The Spirit Of Bandung

The summit in Jakarta was dedicated to the 60th anniversary of the historic conference in Bandung, where, as stressed by the Chinese Xinhua news Agency, “29 countries and areas in Asia and Africa, which accounted for about a third of the world’s territory and about two-thirds of the world population, overcoming significant obstacles for the first time without the participation of the countries of the colonialists discussed problems related to the vital interests of the peoples of Asia and Africa”.

At the summit, much has been said about the revival of the Bandung spirit” of peaceful coexistence and striving for unity while maintaining the distinctions. However, particularly interested in this conference in the context of the competition three Asian powers – China, Japan and India. They all tried to enlist the support of other participants.

So, Chinese President XI Jinping announced the introduction of duty-free access for 97% of goods produced in least developed countries which established diplomatic relations with China (the last clause is important, as a number of poor countries recognized Taiwan to be a representative of the Chinese people in exchange for material assistance). In addition, China within five years, provide 100 thousand places for training specialists from developing countries of Asia and Africa.

In his speech, XI Jinping spoke about the need of strengthening Asia-Africa cooperation through the joint development, coordination of development strategies and the use of economic complementarity as a growth factor through increased cooperation “South – South”, including in the developing countries of Latin America, South Pacific and other regions. In terms of cooperation “North – South” the Chinese President noted that “developed countries are bound to contribute to the progress of developing countries and reduce the gap between North and South” and that “developed countries should fulfil their pledges of assistance and increase support to the developing world, without setting political conditions”.

The main competitor of China in the region – Japan – was presented by Prime Minister Shinzo Abe, who stressed that “the Asian and African countries are no longer aid recipients of Japan, they now are partners of Japan for growth.” In Tokyo is willing to provide opportunities of industrial training for 350 thousand people and promise to expand in Africa sponsored country projects regional treaties such as the TRANS-Pacific partnership, Regional comprehensive economic partnership and the Pacific-Asia free trade zone. Interestingly, in Jakarta occurred a half-hour talks between XI and Abe, which, it seems, the leaders of the two Asian hegemony agreed to some softening of the relations, which deteriorated sharply in recent years.

In these circumstances, the third hegemon of the Asian economy – India – was presented to the lower rank, apparently, focusing on bilateral relations. Foreign Minister Sushma Swaraj spoke about the new Eastern policy of the government of Narendra modi, augmented updated African vector (in this sense, particularly significant for the third summit of the India-Africa forum, which will take place in October).

After the conference, on behalf of its participants the President of Indonesia Joko Widodo announced that in the end consensus was reached on a number of issues – about the need to create a network of peacekeeping centres in Asia-African region, on the joint condemnation of “radicalism and terrorism that are hiding behind the flags of religion”, about “the direction of all efforts to make trade and investment engines of growth”, about the formation of an inclusive and more equitable multilateral trading system to sustainable development and on assistance to Palestine in regard to human resources and building infrastructure.

It’s a good program, but we must not forget that it will be dangerous opponents, which, moreover, are unlikely to speak openly. The globalization of financial capital implies that the Western masters of life left there is a weapon not only to direct sanctions, but deliberately held massive outflow of capital, inevitably engendering the financial crisis. A “new globalization give capital to new opportunities.

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