February 3, 2016, 8:27 pm
Children pose as they wait with other migrants and refugees in line for a security check after crossing the Macedonian border into Serbia, near the village of Miratovac recently. AFP
If by ‘Global Financial Crises’ one means a worldwide diminishing of purchasing power among publics, then, such ‘crises’ could be considered as waiting to happen again. The last time such a ‘crisis' occurred was in 2008-2009 when an unprecedented lack of financial power was noticeable among the peoples of both the North and South, accompanied by the crashing of some major Western banks and financial institutions.
Broadly, a slide in economic growth worldwide resulted in people, including the middle classes, suffering marked impoverishment. Consequently, some notable Western financial institutions were not in a position to recover their loans. Thus, did many a financier crumble and bring about a crisis situation for the Western monetary system.
However, the more robust economies of the South were seen as having survived the financial turmoil. Some of these were the BRICS countries and others, such as, Indonesia, South Korea, Mexico, Colombia and Nigeria, to name a few. What is usually meant by ‘survival’ is that the governments of these countries managed to emerge majorly unscathed from the crisis. It is an open question whether the ordinary people of these countries did not suffer substantial impoverishment in the process.
If we feel compelled to raise these issues and more it is because many a matter of importance in such areas of concern go unexamined and unanalyzed in any detail by international institutions, governments and seemingly knowledgeable sections the world over. There is a tendency on the part of those driving and guiding the world economy to make broad statements and generalizations which continually raise more questions than answer any existing posers.
Interestingly, those countries of the South which were seen as having survived the financial crisis a few years ago were those which engaged considerably in international trade, including intra-South economic interaction. This factor has compelled the UNDP to point out that South-South trade was an important stimulus to growth during the time of the recession of 2008-2009. In its 2014 Human Development Report the UNDP states, by way of substantiating this point, that South-South trade as a share of global merchandise trade rose 8.1 percent to 26.7 percent during 1980-2011.
Moreover, the UNDP points out that countries which registered a high trade to output ratio over the same years were high in Human Development. Some of these countries were: China, India, Bangladesh, Brazil, Mexico and Turkey. Apparently, international trade is a driver of Human Development, although it does not necessarily follow that engagement in world trade would always push Human Development.
However, the point to be pondered is that the global South continues to be home to the majority of the world’s poor. The financial crisis a few years ago only aggravated their condition. Accordingly, the poser must be raised whether we have economic equity in these countries which survived the crisis and registered, curiously, high Human Development.
The commentator is compelled to point out that the above mentioned countries of the South in particular, although proving resilient and robust were not foremost in respect of re-distributive economic justice because the material lot of their ordinary people was and is not commendable. The 'Global Financial Crisis' of a few years ago, then, raises some vital development issues that call for analysis. We are left to face the perennial question: Who are the ultimate beneficiaries of growth? Is it the ruling elites or the people?
However, despite the global South having done comparatively well in growth terms over the years, world financial crises are waiting to happen. On the one hand, re-distributive justice is not occurring to the desired extent inside or outside the South. On the other hand, formal and informal threats to human survival are on the increase in particularly the conflict-ridden areas of the world. These are the essential backdrop to global financial crises.
The international community needs to take note of recent reports from organizations such as Oxfam and the International Trade Union Confederation, which have blown the lid off glaring global wealth inequalities which erode all hope of the world making any progress towards economic and social justice. Among other things, the ITUC, for example, points out that just 50 global companies 'have a combined revenue of $3.4 trillion and the power to reduce inequality. Instead they have built a business model on a massive hidden workforce of 116 million people.' That is, the growth of these companies is fed by a worldwide informal chain of workers who have no direct links with the companies concerned, because they are tenuous links in a long supply chain and enjoy no official status with the companies. But all that they get is a pittance for their labour. Thus, does the poverty bomb tick away.
It could be argued that poverty and inequality have been intensifying over the years and constitute a serious threat to world stability and peace. To the degree to which this threat grows in severity social and political elites around the world are growing obscenely rich. The proof of this is the Black Money syndrome which is growing in leaps and bounds in and outside the global South. Thanks to US Democratic presidential hopeful Berney Sanders, the US cannot claim it is ignorant about the inequality and Black Money blights.
Meanwhile, the human costs of war are mounting by the day and taking on increasingly unsettling forms. Not only is the Syrian refugee crisis growing out of control, refugee children in their thousands are believed to be going missing in the West. The possibility of these children being abused in various ways by human predators cannot be ruled out. In these conflict-hit regions, the world is having on its hands humanitarian crises of daunting proportions.
Accordingly, the threats to human security and survival are growing and intensifying. The world community is obliged to contain to the extent possible economic inequalities, while ensuring that armed conflicts are better managed, if not defused and neutralized. Clearly, ruling and social elites cannot consolidate their power at the cost of the people. This would prove extremely counter-productive because a world where most humans are unsafe would self-destruct.
The human costs of war are mounting by the day and taking on increasingly unsettling forms. Not only is the Syrian refugee crisis growing out of control, refugee children in their thousands are believed to be going missing in the West. The possibility of these children being abused in various ways by human predators cannot be ruled out. In these conflict-hit regions, the world is having on its hands humanitarian crises of daunting proportions.
The Yahapalanayagovernment set up by President Maitripala Sirisena and Prime Minister Ranil Wickremasinghe had sought and won a mandate from the people to investigate charges of corruption and abuse by the Rajapaksa regime.
