Loading...
The Financial Express

For whom the 2019  bells tolled: They will toll in 2020 too

Imtiaz A. Hussain   | Published: January 06, 2020 20:56:52


Protesters raise slogans at a midnight candle-light demonstration against the CAA during the New Year celebrations in Chennai, India.   —Photo:  Courtesy PTI via the Internet Protesters raise slogans at a midnight candle-light demonstration against the CAA during the New Year celebrations in Chennai, India.   —Photo:  Courtesy PTI via the Internet

As 2019 sinks in the abyss and 2020 makes its appearance on the not-so-distant-any more future, it may be appropriate to take stock what wounds we must treat and how to prepare for the inevitable 'known'. The 'unknown' is always there: a sudden development for which we might be not-at-all or half-prepared. Too many dynamics, either released during 2019 or maturing into a force during that year, demand immediate attention.

First among them is the populist anger widening across the globe. Like before, popular elections have enabled it to be ventilated. Although grabbing attention with Donald J. Trump's 2016 election, then fortified by the Brexit referendum, populism was reinforced when the world's largest democracy, through a decisive victory, reaffirmed more robustly the power-reins to Narendra Modi in the 2019 Indian election, then the world's most experienced democracy, Great Britain, similarly reaffirmed Boris Johnson in December. These were the big blows: Britons becoming more British, and Indians becoming more Hindutva-receptive. Their spillovers could be huge.

For example, London's pre-eminent position as a financial centre will now have to trim its sails: Johnson and Britons would want London to reconsolidate itself as an international financial centre, as at the end of the 19th century, when "Britannia ruled the waves," and the British Empire never saw the sun ever setting. The problem with that calculation is how 92 diversified financial companies have already exited London: 24 went to Amsterdam, rekindling a historical financial hub; 21 sailed for Dublin, the salient newcomer capital in European politics and, perhaps, the ray of strongest Scottish hope of becoming 'European' more than 'British' (in turn, making Britain more English than ever in recent memory); 18 crossed the Channel to Paris, the one European capital that has kept the populist tide at bay thus far, as Emmanuel Macron's election dented Marine Le Pen's National Rally irrevocably, at least for the time being; while 6 (six) headed for Luxembourg and 4 (four) for Frankfurt, the former a neutral European spot but perhaps too much in the backwater to evoke that much-needed cosmopolitan flavour, the latter the most likely new hub representing Europe (figures from Vivienne Walt's "Brexit goes Dutch," in Fortune, December 2019 issue). That is a lot, really, of business going down the drain, just like that.

What new alignments will facilitate London's recovery is hard to tell, but the strongest sound bite has come from Trump's United States: a whopping trade deal that could reinvigorate Anglo-American ties in a way they did during World War II, and when Winston Churchill was prime minister. For that to happen, both countries would have to gulp, given their performances, relations, and intentions of late: 'America First' would have to swallow back some pride to let even Great Britain receive new concessions when older and stronger friends, like Canada, have had to stretch to get them; and when Johnson's unavoidable need to reach out to China far more warmly than hitherto, and certainly more than the United States would like it to, since without access to a large market, Britons have a lot more to suffer than with it. Johnson's December victory depended a lot on England's rusty north opting for him rather than Jeremy Corbin's Labour Party, much like the independent US voters did for Republican Trump in 2016 than before for Republicans. Johnson must bring that part of England into the 21st century to retain his popularity there, and this is a thick force against straying too far with trade or investment deals across Asia, or other continents. The Brexit vote was not just against European identities and interests: it masked a deeper anti-foreigner, and particularly visible foreigners (to wit, racially different), for the current Britain to go hobnobbing outside its own neck of the woods.

Trump, according to Geoff Colvin, "is bad for business." That was the title of his December 2019 article in Fortune, in which he argues, though Trump got off well on this front in 2017, slowly and steadily "bad policy choices have pushed CEO confidence [in a president] to the lowest level in a decade." Clearly his tariff wars have not been happily embraced: one or two, perhaps, against China, that too, sporadically, as too against Mexico, would have emitted the signal that Chinese and Mexican free-ridership upon the United States would no longer be tolerated; but those against Canada and the European Union (EU), in addition to the persistent anti-China and still-strangulating Mexico policy approaches, had to look unsustainable over time. Counter-measures by both these countries, as well as India's and Japan's defiance of US 'sticks', might also be hurting these CEO hopes in their own backyards.

Global growth-rates have shown the most direct result of Brexit and Trump's tariff wars: they have, by and large, dipped in every major economy, and for the collective front, here and there. With trade stalling, instead of expanding, given the lowered petroleum prices and strides in the software industry, populists have been energised, and their local-mindedness is squaring off against the inevitable globalism underway.

If any single country depicts these changes most vividly, it is India. Modi's resounding re-election victory has worked more wonders for the extremists in his Bharatiya Janata Party (BJP), with the ghettoisation of Kashmir and the incitement of Assamese ethnic pride to do something completely contrary to India's constitution: push the Hindutva brand, but under the disguise of expunging alleged immigrants, particularly from Bangladesh, the one country most likely to push the Indian economy in the right direction, towards growth, than any other in the region, be it South Asia or South-east Asia.

Instead, the Indian growth-rate may slip more than those of its Atlantic populist partners, Britain and the United States. Not only will this feed the Hindutva charge against India's other minorities, but it will also backfire across India's countryside, where deteriorating terms of trade have disgruntled reluctant farmers supporters of Modi. Something has to give, either farmers or the Indian Union policies (as against provincial authorities) for India to stand robust. Yet, as no side is willing to blink, India could be derailed by its own promises being pushed too far and too clumsily. Like the US CEO backfiring, so too may India's enormous potential to break out of poverty once and for all, may evaporate.

Other countries also face populist pressures, either directly from success (China), or by default (across Latin America, Turkey, and plausibly Southeast Asian countries). The net effect does not align with the 2020 vision: anything but vision will guide the forthcoming years, for good or evil. The US election may have the last say in November 2020, but by then the world will have lived the year off. Perhaps we will get 2021 previews then and from that event, just as this article is receiving 2020's now (written in December 2019).

Dr. Imtiaz A. Hussain is Dean (Acting), School of Liberal Arts and Social Sciences (SLASS) and  Head, Global Studies & Governance Program Independent University, Bangladesh

imtiaz.hussain@iub.edu.bd

 

Share if you like