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It’s rare that the head of a lumbering international organization delivers a visionary speech about a new world order. But when that person is a polymath and strategic thinker like Robert Zoellick, it pays to sit up and take notice. In a sweeping address at George Washington University earlier this month, the World Bank president identified a “critical inflection point” in world history. Global affairs have been so transformed, he suggested, that we need new paradigms for global governance and global development. Since the speech attracted little media attention, The Internationalist thought it opportune to take a closer look.
When confronted with contemporary dilemmas, Zoellick noted, policymakers are tempted to look to supposed “lessons of the past.” In the current economic and political crisis, many have invoked the post–World War II settlement—including the Dumbarton Oaks and Bretton Woods conferences that created the United Nations, World Bank, and IMF—for guidance. But such nostalgia is misplaced, Zoellick suggests, for the global conditions and problems we confront today are vastly different, both qualitatively and quantitatively. The real relevance of history is to give people a better understanding of how their circumstances have changed from the past.
And change they have. Zoellick makes clear just how much the world has transformed since the days of FDR and Truman—and why the world needs a new multilateralism for a new age:
- The ground is shifting under our feet. Economic and political power is flowing to developing countries at an unprecedented speed. In the 1990s, developing countries collectively accounted for a fifth of global growth. By 2025, six of the biggest emerging economies—China, India, Brazil, South Korea, Russia and Indonesia—will account for half. Based on its current trajectory, China may quadruple its per capita income to $16,000 by 2030—“equivalent to adding sixteen South Koreas each year.” For the world to absorb such dramatic changes, China and other rapid ascenders must shift from export-led to more balanced growth. Simultaneously, mature economies like the United States, the EU (European Union) and Japan need to overcome political gridlock and make difficult fiscal choices—or face inevitable decline.
- The time has come to retire old labels and habits. Five decades after decolonization (and two after the Cold War), the shopworn labels “First World” and “Third World”, “North” and “South,” make no sense. It is time to stop treating developing nations as mere aid “supplicants”—wards of the wealthy nations—and start treating them as full partners in the pursuit of shared global growth. Nor can the rich world continue to pretend that it has all the answers, patronizing developing nations with aid conditions and policy guidance when its own recent performance has been so dismal. Increasingly, developing countries are looking to one another for innovative economic ideas and development models—whether it is Brazil’s successful program of conditional cash transfers or Colombia’s mass transit system—and as sources of investment and even foreign aid.
- Tomorrow’s multilateral order will be fluid and volatile. In the twenty-first century, global governance will be more flexible, but also more subject to shocks. Old hierarchies will be pushed aside, as emerging economies join “new networks—of countries, international institutions, civil society, and the private sector—in diverse combinations and changing patterns.” Long-established patterns of Western privilege will fade: “The New Normal will be about countries continually earning their place in world economic affairs, not presuming it because of past standing or official prerogatives.”
- Responsibility applies to everyone. Western officials and analysts tirelessly call for emerging nations to become “responsible stakeholders”—that is, assume the global obligations inherent in their burgeoning power. But Zoellick, who pioneered the phrase in a speech about China in 2005, makes it clear that “This is not just about China. Europe, Japan, and the United States must be responsible stakeholders, too.” This means an end to procrastination in dealing with internal problems like sovereign debt crises, deferred structural reforms, and runaway deficits.
- Development cooperation must move beyond aid. The past quarter century has seen the greatest reduction of poverty in world history, with the number of poor in developing countries being cut in half. Africa, so long an economic backwater, actually grew 5-6 percent in the decade before the global financial crisis—and it is booming again, attracting record trade and foreign investment. To be sure, the “bottom billion” of humanity living in fragile and conflict-affected states will continue to require foreign assistance. But the time has come to envision “a world beyond aid,” Zoellick contends. Such a world would shift from the paradigm of charity to one of mutual economic benefit. It would provide poor countries better access to rich world markets, while allowing them to hedge against fluctuating commodity prices, spiking fuel costs, and natural disasters. It would facilitate foreign direct investment, innovative financing, and technological transfer so that developing countries can modernize industry, agriculture, and services. It would also support good governance and transparency, so that private sector initiative is rewarded, basic services are delivered, and prosperity is broadly shared.
- Women remain the untapped wealth of nations. The evidence is irrefutable. Countries that value women as much as men and girls as much as boys are not only more just, they are also more successful economically. And yet globally, Zoellick notes, women own just one percent of the world’s wealth. Within developing world, girls experience higher child mortality than boys, and women die in childhood in appalling numbers. Women are routinely denied the right to own property, participate in business, gain an education, control family resources, and inherit family wealth. Societies that fail to provide girls and women with their fundamental rights not only commit gross injustices, they also fail to unleash half of their countries’ productive potential.
Zoellick’s take-home message? This is not your grandfather’s multilateralism. Modernizing global governance for the twenty-first century will require a new compact between rising and emerging powers, retiring tired labels like “North” and “South,” accepting the common responsibilities of power, shifting to a world beyond aid, and empowering women to take their rightful place beside men as the prime movers—and beneficiaries—of global interdependence.