Can globalisation change for the better?
Although globalisation has significantly boosted economic growth around the globe, providing consumers worldwide with greater choice and lower prices, enabling the spread of ideas, science and technology, and helping to lift hundreds of millions of people out of poverty, its positive effects have not been felt by everybody to the same extent. For some, globalisation has also contributed — at least in part — to downwards pressures on wages and standards, relocations, factory closures and job losses that have led to a growing backlash against trade openness, particularly over the past decade.
Today, globalisation is changing significantly.
Digitalisation, robots, artificial intelligence, the Internet of things and 3D printing are revolutionising how we produce, work, travel, consume and trade.
The spread of the Internet means people no longer have to move physically to be able to work for a company in another country or to study abroad. Those who found it difficult to relocate for family reasons, or simply because they found it hard to adapt to another culture, can do all this from the safety of their own homes if they want to.
What’s more, global exchanges no longer take place only among the richest countries or the largest companies, but emerging economies, SMEs, start-ups, and other local actors are increasingly involved and able to reap the benefits.
At the same time, the spread of the Internet and the rise of the knowledge economy means that trade is less and less about exchanging goods, and more and more about exchanging services and data. This is happening at the same time as a shift in preferences towards fairer, more locally-supportive production methods, which means that global trade increasingly seeks to fulfil needs that cannot be met at home, or to gain access to creative, innovative and unique features that cannot easily be replicated, rather than to exchange products at the cheapest possible price.
What does this mean for the future?
All these trends mean that the globalisation of the future could have a rather softer, more inclusive face than that of globalisation past. One where wealth has the potential to be distributed more fairly across people, regions and countries; one where greater participation is possible at all levels; one where sharing and open access become a core part of business models; one that promotes a race to the top by resolutely fighting against harmful and unfair behaviours that overshadow today’s globalisation, such as tax evasion, corruption, resources extraction, illicit financial flows, harmful government subsidies or social dumping.
Of course, rising to existing challenges will not suffice, as new ones emerge with the world’s nations becoming increasingly intertwined, not only economically but also environmentally, demographically, digitally and politically. Migration flows, terrorist threats, cybersecurity, health pandemics and climate change — all will require careful global governance in a world where risks and vulnerabilities spread much faster than ever before.
How can the EU make a difference?
History has already provided ample evidence of the role of international institutions and global rules and values in bringing peace, stability, trust and prosperity.
But multilateralism and the global rules-based order are faced with unprecedented challenges as the backlash against globalisation grows, including among former champions of global trade, such as the United States. This means that the European Union — itself a model of successful cross-border integration — has a leading role to play in creating a ‘better globalisation for all’.
It already played a central role in pushing through the adoption of the 2030 Agenda for Sustainable Development and the Sustainable Development Goals (SDGs), as well as the binding international agreement on climate change at the Paris COP21 meeting, in 2015.
Europe has a unique opportunity to continue to shape the global rulebook
Today, as the world’s largest single market, its largest trader and investor, and the largest provider of development assistance, Europe has a unique opportunity to continue to shape the global rulebook. But to enable this, Member States will have to pull together and decide where it is that acting and speaking together really does add up to more than the sum of each part.
Looking ahead, the already ongoing demographic, economic and political shifts may challenge our position of influence and our capacity to promote our values of cooperation, rule of law, equal rights and solidarity. So there is clearly no better time to start working on this than now.
For more thoughts on how the EU can contribute to a better globalisation, you can take a look at the European Commission’s recent Reflection Paper on ‘Harnessing Globalisation’ and share your thoughts on the Future of Europe at https://ec.europa.eu/epsc/future-of-europe_en.
