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Globalization is evolving, not receding

By Jan Zilinsky (People's Daily Online)    10:57, June 02, 2016

The loudest voices in the West come from “globalization pessimists” these days. One group denies that cross-border trade and international engagement and cooperation are beneficial. Another believes countries should work together, and trade makes sense for developed and developing countries alike – but gloom permeates this camp as well. 

The timidity of the proponents of globalization has several explanations. Even in countries where unemployment is moderate, large numbers of workers have not seen improvements in their living standards. Many workers feel that what was once an income and social ladder they could climb – through higher wages, promotions or better working conditions – today feels more like a slippery velvet rope. Some workers, generally those with a higher education, are able to make the ascent – many fall off and feel excluded.

The dissatisfaction of some workers in the United States, especially those facing competition from China (because they work in the manufacturing sector) is turning to a raucous opposition to any form of trade agreements. The lack of successful recent trade initiatives partly explains why global trade is slowing down, although the amount of goods and services exchanged between countries is still growing moderately.

Instead of explaining that trade is a major ingredient for economic prosperity, various US presidential candidates have sought to blame foreign countries for domestic problems. The uncomfortable truth is that poverty and job insecurity exist in all developed economies, and restricting trade will not resolve any urgent social issues.

There are other reasons for unease about globalization in the months ahead. The unification project that began in Western Europe almost six decades ago no longer inspires its citizens. The United Kingdom is seriously considering leaving the European Union, and nearly half its population seems to believe Britain would be better off on its own. With the crisis in Greece and migration pressures not yet resolved, the referendum that will take place in the United Kingdom in June is the latest reminder that the European Union’s architecture is vulnerable. Few EU members have the courage to pursue necessary reforms and improvements that would allow the union of 28 European countries to function more efficiently.

In spite of the profound challenges outlined above, there are at least three reasons to hope that globalization can continue, and even thrive. First, connections between countries are increasing. If one defines globalization narrowly as the exchange of tradeable goods, then it is easy to reach the incorrect conclusion that globalization is slowing down. A more complete analysis should also consider activities like international travel and cultural exchanges, including tourism and students studying outside of their home country, communication flows (transmission of data), scientific collaboration, e-commerce and other types of “digital markets”, as well as the steady expansion of companies from developing countries to other markets.


(For the latest China news, Please follow People's Daily on Twitter and Facebook)(Editor:Wu Chengliang,Bianji)

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