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GS Mains Test Series 2018
GS Mains Test Series 2018

MULTILATERALISM AND THE DIVIDING WORLD ORDER

Introduction

Multilateralism is the process of organizing relations between groups of three or more states. Beyond that basic quantitative aspect, multilateralism is generally considered to comprise certain qualitative elements or principles that shape the character of the arrangement or institution. Those principles are:

  • An indivisibility of interests among participants,
  • A system of dispute settlement intended to enforce a particular mode of behavior.

Multilateralism has a long history, but it is principally associated with the era after World War II, during which there was a burgeoning of multilateral agreements led primarily by the United States. The organizations most strongly embodying the principle of multilateralism are to be found in trade (the World Trade Organization [WTO]), security (the North Atlantic Treaty Organization [NATO]) and environment (numerous multilateral environmental institutions also exist).

    Brief History of Multilateralism  

•     Concert of Europe: The end of the Napoleonic wars in Europe saw the establishment of the Concert of Europe, with the great powers redrawing European borders peacefully at the Congress of Vienna.

•     League of Nations: The First World War destroyed the European Concert and replaced it with League of Nations.

•     UN, IMF & IB: The post-World War II world saw the creation of a new world order sustained by multilateral and supranational institutions such as the United Nations, the International Monetary Fund and the World Bank.

 

To better understand the nature of multilateralism, it is useful to contrast it with bilateralism. Bilateralism is the conduct of political, economic, or cultural relations between two sovereign states. It is in contrast to unilateralism or multilateralism, which is activity by a single state or jointly by multiple states, respectively. Some examples in different sectors are -

  1. a) Security arrangement
  • In security arrangements, the principles of multilateralism are best embodied in a collective security system such as NATO, in which a war against one state is considered to be a war against all states, ensuring that any act of aggression against a member of the collective system is met with a response from all members.
  • By contrast, a bilateral arrangement only ensures that A comes to the aid of B in the event of an attack by C. It would not ensure that C receives similar protection from A in the event of an attack on C by B. In that instance, the system discriminates against C.
  • Bilateral security arrangements are, therefore, like their counterparts in commercial policy is being inherently discriminatory, whereas multilateral arrangements have a more-inclusive character in which all participants are afforded equal treatment.

Dispute Settlement

  • Having a system of dispute settlement enables participating countries to treat their interests as indivisible and to accept relations of diffuse reciprocity: they know that should the expected benefits not be forthcoming because of noncompliance by other participants, there is a mechanism through which redress may be sought.
  • The above principles taken together form an "ideal type" of multilateralism. Although there was huge growth after World War II in the number of multilateral institutions, they have not always fully conformed to all aspects of this ideal model. Such institutions undoubtedly played a significant role in postwar global governance.

More controversially, it has been argued that multilateral institutions may be inherently more stable than other forms of organization in that the principles underlying them appear to be more durable than other arrangements and more able to adapt to external changes.

Thus, despite the perceived decline in the relative power of the United States after the 1970s, the multilateral institutions continued to play an important role in shaping the international system.

However due to 'Great Recession',  Globalisation concept is at a crossroads.

The dynamics of freer circulation of goods, capital and people has lost steam. Trade protectionism is on the rise. Multilateral institutions such as the International Monetary Fund, the World Bank and the World Trade Organisation provide slow and often insufficient responses to contemporary challenges.

Reasons for failing Multilateralism

  • Geopolitical competition. [E.g. USA vs. Russia = NATO & Warsaw Pact & Syrian Crisis]
  • Faith in multilateral institutions has dropped because of rigid rules, and slow paced reforms.

–       WTO negotiations are stuck in gridlock.

–       Developing nations are not getting due membership in UNSC.

  • Multilateral institutions have become prone to conflict instead of consensus.
  • Bilateral and Regional groups are considered as offering better deals through access to deep market, while balancing free trade with social goals (Subsidy, poverty, etc.).
  • Developed societies have changed, embracing individualism over social democracy [Joint family to Nuclear family].
  • Negative consequences of Globalization - income inequalities between developed and developing, crony capitalism, WTO like organizations favoring developed countries over developing, etc.

Some examples are as follows:

UN (The most important Multilateral Institution) is undermined by

  • The regional security pacts like NATO, Warsaw Pact, Shanghai Cooperation Agreement, etc.
  • Russia's absorption of Crimea.
  • U.S.A's military mobilization against Bashar Al Assad's Syrian regime without the approval of the UN.
  • China's rejection of the Permanent Court of Arbitration's decision in the South China Sea case, despite signing up to the United Nations Convention on the Law of the Sea.
  • United Nations Security Council failed to restrict terrorism by their use of the veto. In the most recent example of this power being exercised, Russia and China voted against a draft resolution that would have condemned a crackdown on anti-government protests in Syria and called on Bashar al-Assad, the Syrian president, to step aside.
  • At the creation of the UN in 1945, the United States was the only nation in the world to own and test nuclear weapons. In 1970, the nuclear non-proliferation treaty was signed by 190 nations, including five nations that admitted to owning nuclear weapons: France, England, Russia, China, and the US. Despite this treaty, nuclear stockpiles remain high, and numerous nations continue to develop these devastating weapons.

WTO's (the most important multilateral trade organization) failure:

  • WTO was driven to irrelevance by the collapse of the Doha trade round in 2008.
  • Cluster of regional and bilateral trade agreements such as the Transatlantic Trade and Investment Partnership, Trans-Pacific Partnership, RCEP etc. are making WTO irrelevant.
  • The lack of transparency is often seen as a problem. Politicians can negotiate for regulations that would not be possible or accepted in a democratic process in their own nations. "Some countries push for certain regulatory standards in international bodies and then bring those regulations home under the requirement of harmonization and the guise of multilateralism." This is often referred to as Policy Laundering.
  • WTO is highly biased towards the developed and rich nations.
  • WTO supposedly operates on a consensus basis, with equal decision-making power for all. Involvement of the poor countries is less in the decision making process and they have less bargaining power.

IMF failure:

  • In its structural adjustment policies IMF has been guided by the supremacy of the free market in promoting economic growth. Thus, it indirectly promotes the interests of the developed countries ignoring the requirements of developing countries.
  • IMF policy of providing financial assistance to the poor developing countries subject to the fulfillment of certain conditions by the latter has come in for severe criticism. In fact, capital market liberalisation proved to be disastrous for many countries because they were not ready and able to deal with the great volatility of capital inflows and outflows, as happened during East Asian crisis of 1990s.
  • IMF policy of laying emphasis on elimination of subsidies, liberalisation of trade and capital market privatisation as conditions for providing financial assistance to the developing countries has not led to the solution of the twin problems of poverty and unemployment in the developing countries.
  • AIIB and BRICS Bank are seen as rivals of IMF and WB.

Rise in "Our country First" concept

  • Multilateral systems such as the EU or NATO, and other forms of international cooperation have been among the greatest successes since the Second World War, based as they are on the fundamental principles of democracy, peace, and collaboration among war-torn countries in Europe. However, now there has been rise of ‘Our country first’ concept.
  • The "Our country first" approach is being pushed by many populist movements on a global level and it seems that governments are starting to reject their responsibilities towards the international community by undermining global cooperation.
  • One of the most recent signals of this movement against multilateral cooperation is "Brexit", or the UK's decision to leave the EU. Multilateral cooperation is also facing a challenge on a global level. Especially when it comes to engagement in sustainable development, the multilateral system seems to be mired in stagnation due to global political changes and movements.
  • US president Donald Trump wants to reduce US funding of the United Nations by around 30 %. The US is traditionally the biggest funders of the United Nations, and last year spent two billion dollars on the World Food Programme (WFP), a quarter of the WFP's entire budget.
  • The executive order to be signed by the US government will also impact the United Nations Populations Fund (UNFP), which mainly works with women and children.
  • The biggest failure of global treaties is that poverty has never been the focus of global treaties that directly relate to women and children. Therefore, the question arises of what kind of effect this will have on the people affected. A lot of people will not accept poverty as their destiny and will make the journey to richer countries. This in turn creates anger and fear in the destination countries, which, combined with personal frustration regarding their national economy and politics, is a potent source of nationalism. Nationalism has been a key source of conflicts, especially in the twentieth century.
  • However, it is unclear whether these populist movements will gain momentum and impact, or if they will spark counter-movements that will give the concept of multilateralism a new direction. This could happen if there is an active civil society that is able to effect change on local and global levels.
  • But concerns remain - both that current trends could trigger a crisis in the multilateral system and over how global cooperation can be strengthened.

Example:

US pulls out of Paris climate accord to 'put American workers first'

US has announced that it will withdraw the US from the Paris climate change agreement.

The decision was condemned immediately by environmental campaigners and by the president's political opponents who said it heralded the death of America's position as a global leader.

It means the US stands alongside only Syria and Nicaragua as nations who are not part of the deal.

Environmental campaigners said the American absence will make it considerable harder for the remaining 190 or so countries to reach their agreed goals, given that the US is responsible for about 15 percent of global emissions of carbon and promised $3 billion to help other nations. This can be interpreted as an example of deglobalisation

 Conclusion

The current context, characterized by a weakening of multilateralism, the return of protectionism and the rise of extremist political movements, undermines the advancement of that global consensus, poses a grave challenge to the world economy and threatens the attainment of the Sustainable Development Goals.

Today more than ever, we must promote and expand cooperation and integration on a multilateral basis. The 2030 Agenda and the SDGs are universal not only in that they aspire to include all the world's countries and that their attainment may develop inclusive society, they are also needed to improve the national efforts by global & regional cooperation.