This column was previously published in L’Opinion on 13rd may, 2020
It is no surprise to anyone that, just like its kangaroo, Australia is jumping back on to the scene with a suggestion from its former Prime Minister Kevin Rudd as to how to rebuild global governance when the COVID crisis is over.
It is quite obvious that the G20, having become G2, is now shifting to G-Zero: our world is a-polar, for both American “soft power” and Chinese “sharp power” are being rejected by the rest of the world. People all over the world are just as shocked by the rejection of truth by the dictatorial regime in China — symbolized by the death of doctor Li in Wuhan — as they are by the rejection of the wisdom of science by the Trump administration’s handling of the epidemic, such wisdom being at the very foundation of American influence.
This G-Zero crisis contrasts strongly with the response to the 2008 crisis (which had led to the creation of the G20, which President Sarkozy had pushed for). In 2020, there is no coordinated global recovery — far from it; we are witnessing the triumph of purely national interests, as seen in the boost given solely to domestic demand in China, and in the US Federal Reserve’s “Bazooka” which is solely focused on maintaining the S&P bubble, even at the cost of 30 million unemployed.
For the West, the future will not so much be determined by the political dream of industrial relocation — which will come to nothing — as by studying the many successes of the South-East Asian model
The Sino-American trade war will soon be revived during the presidential campaign, considerably fortified by slogans like “China will pay!”. It is easy to see that this presents a risk echoing back to the Treaty of Versailles. 20% of the Chinese economy still depends on exports and cannot do without international trade. At the same time, US technology would be the first victim of an American embargo, as shown particularly well in a recent report by the BCG: “How restrictions to trade with China could end US leadership in Semiconductors”.
The wheel of history. With this in mind, Kevin Rudd is proposing to place global interests above national interests by means of an original model: the creation of a “G-minus-2” which would exclude both China and the USA from governance of multilateral institutions. He proposes to bring together all those countries that recognize — from a governance standpoint — the need to combine the invisible hand of the market and the visible hand of government; from an economic standpoint, the will to maintain the freedom of international trade; and, from an social standpoint, the pursuance of multilateral solutions to problems of a global nature, such as Covid-19 and climate change.
In a G-minus-2 scenario, the West will have to leave its arrogance behind and get accustomed to taking inspiration from South-East Asian countries, who have emerged from the public health crisis as the big winners
In order to succeed, the proposed scenario will have to take account of the world’s swing towards South-East Asia; the West will have to leave its arrogance behind and get accustomed to taking inspiration from countries with models as different as South Korea, Taiwan, Singapore, New Zealand, Australia and Vietnam. These countries are the ones that have emerged from the public health crisis as the big winners and will be the first to benefit from the resumption of intra-regional trade in Asia, which will lead to Asia separating itself not only from Europe but also from the USA, contrary to the 2008 crisis.
For the West, the future will not so much be determined by the political dream of industrial relocation — which will come to nothing — as by studying the the South-East Asian model and its many successes, and this will speed up the wheel of history. This will be the only way to make the “G-minus-2” into a real plus.