Trends in the “South” Will Have Serious Affects on the BOP
As heads of the World Bank battle it out over how to curtail corruption in beneficiary countries, a curious trend is forming that could be a far greater threat to the open, global economic system they favor than any graft or bribery scheme. Over the weekend 116 countries were represented at the Non-Aligned Movement meeting in Cuba. These countries largely comprise the symbolic ?South? in the North-South view of global economic and political power.
Pundits around the world saw this as a ?revival? for the NAM after having dwindled following the end of the Cold War. I think the US media makes a mistake in painting this as a general anti-US or anti-Western conference; although it is attended by the likes of Hugo Chavez and President Ahmadinejad, the overall sentiment seems to be a greater need for economic and political independence.This trend is more than symbolic- ?South-South? trade is on the rise, particularly between Africa and Asia, and events like the apparent collapse of WTO negotiations could be triggering a cross-cutting belief that the neoliberal policies pushed by the global ?North? are not helping intended beneficiaries at the BOP.
The consequences for the world’s poorest depend on whether the trend is increasing trade but in a limited sphere, or a general withdrawal from global markets. Countries shutting their economies off from international trade as a rebuke of globalization in general will decrease opportunities for the BOP to buy cheap products from competitive producers or sell goods to a wider audience. It remains to be seen whether the desired independence of NAM countries is channeled toward greater economic activity at a regional level or a rejection of more open economic policies.