Dear Editor,
Local mainstream newspapers recently referenced a report from the Inter-American Development Bank (IDB) entitled: ‘Global and Regional Economies at a Crossroads‘.
The Report alerted that, while there has been progress in economic recovery in most Caribbean economies, despite persistent external shocks, `risks remain in the near-term.’
The IDB Report went on to predict and warn that; ‘Growth rates are likely to converge to pre-pandemic levels unless there are significant structural changes (a dramatic shift in the way a country, industry, or market operates, usually brought on by major economic developments), to enhance productivity (value added per human capital-adjusted hours).
Guyana is a case in point. The country’s economy under the Ali administration is on a transitional trajectory that envisages certain structural changes that have already brought in its wake remarkable economic growth. In that regard, the IDB Report lauded the ‘Hydro-carbon extraordinary growth of Guyana that dwarfs the economic growth of all countries in the Western Hemisphere.’
And the International Monetary Fund (IMF) in a recent report published declared that Guyana ‘will continue to see very rapid growth and that ‘the outlook for medium-term growth ‘is better than ever before.’
While CARICOM member states continue to struggle to overcome ‘under-development’, the performance of their economies is not experiencing the desired structural changes nor enhancing productivity. Whether this is because member states are still reeling from the blows of COVID- 19, as a regional body, they are not developing the momentum nor dynamism consistent with the pace of global developments. Clearly, the situation needs to be discussed publicly considering economic and social developments in other regions.
It is generally recognized that the world is at a critical juncture, with the international system, financial stability and political equilibrium cumulatively on the cusp of change.
Triggering this impending transformation are the Russia/Ukraine war; its impact in the global food chain; the global refugee crisis and the transformative steps envisioned by BRICS. By their very nature, current global developments encourage us to seriously contemplate the beckoning of new era.
The shift in the balance of forces at the global level is qualitative, if not fundamental. The industrialized economies are finding it highly improbable for them to maintain the dominant position they once held globally.
Writing for the New York Times in its Sept. 4, 2023, edition, John Raptly made the following comparative analysis; ‘The Western world accounted for four-fifths of global economic output. Today, that share is down to three-fifths, and falling.’
Raptly further stated; ‘While Western countries struggle to restore their dynamism, developing countries now have the world’s fastest-growing economies. Through institutions like BRICS and OPEC, … they are converting their growing economic heft into political power.’
Goldman Sachs economist Jim O’Neill described the BRICS countries as ‘fast-growing economies’. With a combined GDP of US$55 trillion, which is 30 percent of global GDP; O’Neil predicted ‘BRICS would collectively dominate the global economy by 2050’.
And Kishore Mahbubani, a former ambassador for Singapore in an interview with the New York Times was reported saying; ‘’There is a structural shift happening in the global order,
the power of the West is declining, and the weight and power of the global south — the world outside the West — is increasing.”
This structural shift, is reflected in a new reality whereby developing countries are gradually reducing their dependence on the World Bank and the IMF. They have established new lending institutions and begun experimenting with trading arrangements that lessen their dependence on the US dollar.
The Global South has succeeded in converting their expanding economic clout into political and diplomatic power. Not only have they acquired the capacity to negotiate better trade and financial agreements, they also have a crucial bargaining chip in the form of two resources businesses in industrialized countries now need: growing markets and abundant supplies of labour.
The structural shift in the global order that beckons the dawn of a new era is reminiscent of the struggles waged decades ago by former colonies in Africa, Asia, Latin America and the Caribbean for economic and social liberation. Those struggles resulted in the demise of an outdated colonial system.
And just as the anti-colonial liberation struggles profoundly shaped global history, in the same way the structural shift at the global level in favour of the Global South will shape the contours of a new global human order.
The world badly needs this genre of political imagination.
Yours faithfully,
Clement J. Rohee
