Editorial | Going beyond the UN initiative

LAST WEEK’S United Nations (UN)-backed “high-level event”, aimed at mobilising global financial support and debt relief for developing countries, was an important initiative, which this newspaper hopes will lead to concrete action.

For, as Antonio Guterres, the UN secretary general – who, with Prime Minister Andrew Holness and Canada’s Justin Trudeau, convened the session – has been warning, the global economic shock caused by COVID-19 poses grave risks for achieving the UN’s Sustainable Development Goals (SDG), including the elimination of hunger and poverty by 2030. Indeed, Mr Guterres has argued that the response to the pandemic demands an outlay of “at least 10 per cent of global GDP”, in the effort to “build back better for more resilient economies and inclusive societies”.

While Mr Holness must work hard marshalling support for the programme articulated last week, he must be clear that this project should not be an end in itself. He should see it as a first step towards a potential reform of the global architecture, in which he has been afforded a toehold on behalf of the Caribbean, before the present structures are dismantled by Great Power leaders with 19th- and early-20th-century notions of international relations.

IMPACT OF COVID-19

More than six million people have already contracted COVID-19, from which the death toll is heading towards 400,000, or six per cent of those infected. The disruption it has caused to world economies means that global output, according to the International Monetary Fund, will decline by more than three per cent in 2020.

Mr Guterres said that without support for vulnerable countries, a further 60 million people – joining more than 700 million, or 10 per cent of the world’s population, already in that category – could be pushed into extreme poverty, while 1.6 billion could be left without livelihoods. Up to US$8.5 trillion could be cut from global output.

This is part of the backdrop against which last week’s virtual meeting gave its imprimatur to six working groups that will look at ways to:

• enhance global liquidity, so that developing countries have the resources to respond to the pandemic;

• prevent debt crises in at-risk countries, including middle-income ones;

• have private creditors support/participate in debt-relief efforts;

• aligning the global financial systems with SDG;

• end illicit financial flows; and

• in Mr Guterres’ phrase, “rebuilding differently, and better”.

As vital as these undertakings are to developing countries, including those in the Caribbean, the initiative isn’t, on the face of it, designed to take a cold, hard look at global institutions, including the Bretton Woods ones, and, as Barbados’ Mia Mottley recently put it, “repurpose” them to ensure that “we are really reacting to what is real”.

The point is, multilateralist arrangements, which, for three-quarters of a century, afforded weaker countries, though imperfectly, insulation against arbitrary behaviour by powerful ones, have been badly strained with a robust, and ascendant, re-emergence of unilateralist sentiments, especially in the United States. The threat this raises for multilateralism is exacerbated by the pandemic, as countries use supply-chain disruptions not only to question the efficacy of economic globalisation, but to hark back to a formula for international relations, resembling what existed up to the First World War, with an overlay of Cold War politics.

The geopolitical jostling between the United States and an economically and technologically emergent China, America’s exaggerated sense of grievance against international institutions, such as the World Health Organization, and Roberto Azevedo’s abrupt resignation as head of the World Trade Organization, made moribund by US disengagement, further exemplifies the global political crisis.

It represents, too, an inexorable march by those with the capacity to pull the levers, towards reshaping the global arrangements. Jamaica and its partners in the Caribbean Community (CARICOM) must recognise the situation for what it is, and be prepared to have a say at the table. But, as we advised previously, CARICOM must know what it wants, with whom it shares common interests and can make common cause, and leverage a combined strength. It is not our sense that work is as yet taking place.