Daily Times

Even the temporary retreat of the world’s most innovative economy from the global economic machinery can create ripples but the destruction of the whole system is an exaggerated idea, though the global economic machinery at this critical juncture is ready to readjust itself to these vital changes.

American businessmen, Malcolm Mclean revolutionized the trade with the invention of an intermodal shipping container, the container trade these days is a global norm, because of its international standardization and recognition. The global rules and laws mostly devised by the Western powers, are now the soul of the global economy; because they are vital for every single state who wants to trade across the ocean, land routes or air, they follow the same rules.

INCOTERMS, are defined commercial terms established by the International chamber of commerce and are recognized globally by the governments, container trade protocols in the form of an International Convention for the Safety of Life at Sea (SOLAS); it is the most important treaty which deal with the safety of ships, by assigning the internationally recognized weight of container after loading cargo into it. Moreover, it also deals with the overall ships construction safety requirement agreed by all the states, these conventions and methods though devised by West are now globally accepted, this goes to show how these norms have become the very soul of today’s trade network.

The resurrection of trade barriers by the United States (US), or any other country is the sovereign decision of that state to readjust itself in the global economy.

This illusion of action can create ripples in the global economy, if that state is central to the global economy because of its continued relevance to international economic institutions it has created, like the dollar as a global currency, its political and military might, therefore its retreat from the global forum can render those institutes null and void. But the world is now addicted to the idea of economic growth, using the same principles, the world used since the Obama presidency.

The global trading system needs a revamp to address the grievances of United States and the new winners in the global economy, the World Trade Organization will exist because as mentioned earlier, countries are now addicted to a rule based order, and are reluctant to give it up

South Korea, India, China and Japan are the prime examples of this idea; China is at the centre of the quad- even though, the other three countries have a range of historical, military and contemporary issues with China, but they do not let them affect their economies. The bilateral trade growth is adding up, while the growth quad, and the other thriving economies like Brazil, South Africa, Argentina, Indonesia, Australia and Malaysia are finding ways to negotiate modern day trade agreements.

The existing multilateral trade agreements, and trade blocs are also in the offing. BRICS, ECOWAS, ASEAN, MERCOSUR are important blocs which have achieved great success with the evolution in integration. The Regional Comprehensive Economic Partnership, and Trans Pacific Partnership, are others among the list who are ready to be accepted. Moreover, Asian countries have finally achieved a level of political maturity to keep politics and all the geostrategic issues away from the market.

The rise of China’s ports, alongside the rise of alternate carriers to carry out trade operations at sea, and Asian container trade and safety alliances are the signs which show that the global trade and economy will achieve considerable stability even in the absence of United States. Threatening to quit the global system, is more a negotiating tactic than a final decision.

The global trading system needs a revamp to address the grievances of United States and the new winners in the global economy, the World Trade Organization will exist because as mentioned earlier, countries are now addicted to a rule based order, and are reluctant to give it up. Multilateral trade blocs are here to give necessary support to multilateralism, the -ism which is needed by the world in its time of need for international trade and cooperation.

Masters in Strategic Studies from Dept of Strategic Studies, From National Defence University. He can be reached at janwaqas03@gmail.com

Published in Daily Times, October 16^th 2018.