Tearing up the rule book: the end of the new world order?
The dominant narrative has it that, especially since the fall of communism, international trade and politics has been characterised by the spread of a relatively stable order defined by liberal, free-market values and agreements. This is often referred to as the ‘liberal, rules-based, international order’ and an increasing number of countries have been pulled into its orbit.
While this narrative was never without critics, recent years have shattered this confident understanding of the march of the ‘end of history’. Populists across the world – including most noisily President Trump – have denounced free-trade agreements and collective security arrangements. They have argued that countries should act selfishly in their best interests, liberal internationalism be damned. Trump’s belligerent trade rhetoric – including demanding a ‘fair trade’ deal with the EU or else face ‘tremendous retribution’ – and the application of ever-expanding sanctions against China, have caused many commentators to question whether free trade has had its time.
Also undermining faith in the liberal international order are the rise of China and the resurgence of Russia. China has increasingly asserted itself, including the building of man-made islands in the South China Sea for alleged military purposes, while Russia’s invasion of Ukraine has caused particular concern. However, many commentators have long dismissed this view of global affairs as little more than a sham cover for Western and especially US interests. Russia may be flouting international law with the annexation of parts of Ukraine, but the ‘rules-based order’ has survived countless ‘illegal’ American interventions around the world.
What’s more, many dismiss the idea that the world order until now has genuinely been based on free trade. The EU maintains huge external tariffs and other forms of protection on goods and services, including the infamous Common Agricultural Policy, which critics accuse of keeping African farmers in poverty. Enforced stability and regulation, providing businesses with laws and regulations that benefit their interests, have furthermore been central to the development of international capitalism. Moreover, critics allege that various institutions of the free market, such as the World Bank or IMF, are artificially keeping certain countries in ‘debt bondage’. Seen in this light, Trump’s ‘America First’ trade policy is little more than a characteristically blunt public admission of American trade policy for the past 50 years.
Are we witnessing a change in the defining features of the international order, or are such concerns more a virtue-signaling expression of distaste towards certain politicians? Are we really moving into a more protectionist world, or will free-trade ideology make a comeback? Is there a difference between the ‘rules based’ international order, and a world of American hegemony? Fundamentally: what will be the defining features of international trade and politics in a world witnessing the rise of China, the apparent slow decline of the US, and the rise of the ‘global south’?