A LIMBO BETWEEN GLOBALIZATION AND PROTECTIONISM

Globalization has brought about changes in the shape of the contemporary society. However, especially after the financial crisis of 2008, we observe a moving away from the liberal internationalist political approach towards isolationism and skepticism. Examples such as the British voting for Brexit, and the election of Mr. Trump as the president of the United States, show a follow-up on this seclusionist mentality. This is evidenced by Mr Trump’s campaign, advisory team and republican party which are considered extremely conservative. The effects of the application of economic and political isolationism can be devastating, at least for countries that rely on foreign help and foreign direct investment and extensive loans for their survival.

Economic Consequences

Negative emergency omens of moving away movements from world trade began seven years ago, as governments have made efforts to shield their fragile economies after the economic crisis/Great depression of 2008. The concomitant recession in the global economy, the public dismay, the unemployment, created the foreground for the states move from free trade to protectionism measures. Apocalyptic is a report of the WTO on measures against free trade policies adopted by the G20. There are recorded 1671 protective measures from the 20 most economically powerful nations of both developed and developing world. Out of the 1671 protectionist measures only 408 were decided not to be implemented. These measures in remain at alarmingly high levels and increase the pressure on governments to cope.

Moreover, equally alarming is the declining percentage of the WTO profit results, which recorded a slower growth in development and trade particularly after 2009. It is the first time in 15 years that the ratio of the increase in world trade in terms of global GDP growth is lower than 1:1.

As a result, the contribution of international trade to the strengthening of global economic activity will be reduced. Long-run economic trade increased about 1.5 times faster than global Gross Domestic Product. In contrast to the past, with a specific focus at the 1990’s, global trade expanded at double the pace of world GDP. However, let’s not neglect that back then the global community was in favor of internationalism.

The Politics of Fear  and Isolationism

Protectionism measures such as tariffs, import-quotas, extensive agricultural subsidies (such as the ones provided by the EU towards EU farmers) have been fueled by a climate of pessimism because of the low growth rates that exist today. Several fronts have contributed to this international relations blenders and passivity. For instance, the high volatility of the Chinese markets, the political crisis in Brazil, and of course the referendum on the Brexit are only a few examples that attest to this truth. All in all, in the heart of protectionism lies the great distrust and discontent particularly of the developed world citizens for the increasing trend of unemployment and the influx of refugees, which renders economical growth of a country within almost impossible.Employment, influx of investment, equity, social inclusion, raise of income, stabilized economy are only a few of the benefit of healthy economic growth that are jeopardized for the fear that isolationist policies and mentality bring.

In Greece, the refugee and economic crisis makes the future of our society clouded and ominous, when these problems are addressed in a climate of disbelief and isolationism. It almost creates a historical parallel with the Weimar Republic which was led to its downfall and loss of votes in the Reichstag due to the mistrust and loss of business confidence from the public. Apart from that, the terrorist attacks in Brussels, Paris, and Berlin exacerbate the flaming situation by increasing introversion in northern European countries that were up to now a popular destination for many refugees and economic immigrants. Given that societies reacted with xenophobia symptoms, governments became more conservative forcing them to respond to the demands of their citizens, the efforts for a multilateral, tolerant, visionary and unified management of the refugee crisis accepted a heavy blow. The confrontational relationship among the members of the European Union, in which Greece is the recipient of an often unjust and excessive criticism, will worsen.

Given the religion of the vast majority of those entering or seeking to enter Europe, many will rush to link migration with Islamic terrorism. Extreme (mostly rightist) voices and behaviors, will be strengthened. Extreme political measures cultivate violence. For example Greece is a country that benefits politically and financially by its relationship with the European Union’s members. Greece’s financial situation is heavily impaired by the strengthening of scepticism and a wave against every form of solidarity and tolerance is already apparent.

In this environment of fear and tension, the limited flexibility and durability of Greece is going to resolve to breaking point.  Greece, as it is right now being economically impoverished and polarized, bureaucratically purged, politically unstable, crumbling in the secondary sector, and socially vulnerable, risks to fall victim of destabilization and uncertainty. But Greece is not the only example of the consequences of isolationism.

Besides the radical US choice to elect Donald Trump as the next US president, European countries feel the need for self-preservation of themselves. At the EU Summit in late October, the European Commission invited the leaders of the EU member states to “use protective measures in their full force,” as stated by its chairman, Jean-Claude Juncker. The EU represents 15% of imports in world trade, but protective measures are imposed only in 0.21%. “Thousands of jobs have been lost by some EU industries We can not remain inactive, “added Mr. Juncker, referring indirectly to the effects of the European steel industry from Chinese imports. The WTO believes that free trade is the antidote for employment and living up to the high standard of living.

A dispute between protectionism and globalization is underway, while Donald Trump announced that the US will withdraw from the new Pacific Partnership agreement (TPP) when he assumes the presidency of the country on January 20 confirming some of the fears about moving US away from free trade. Among the 12 Pacific countries participating in the TPP there are Japan, Mexico, Australia and Canada, which all together represent the 40% of the global economy. Which means that it is already several disgruntled leaders and entrepreneurs of the world even before officially taking Mr. Trump president of IPA.

Overall, it is a grave need to realize NOW that closing borders, isolating, allowing legal limbo to become reality for refugees and denying hospitality is unethical !!! However, accepting everyone will inevitably lead to economical, social, and moral catastrophe. The solution was and always is equilibrium: to find the right balance and host as many foreigners as a country can without affecting the quality of the lives neither of its own citizens nor of the people who try to adapt to the environment of their new home.

 

 

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