• Home
• /
• Opinion

KT edit: A new Cold War will make the pandemic worse

More trade, not less will expedite the return to what will be the new world order

Free trade and globalisation have been under attack for some years now, and the pandemic could deliver a fatal blow to a connected and open world if the two major powers, the US and China do not pull back from their positions. The movement against free trade gained steam in 2016 after the Brexit vote was dominated by concerns of immigration and free trade. The election of Donald Trump as US president raised the rhetoric to levels never seen before. Trump has alleged often that China has gained and gamed the system to others' disadvantage after it joined the World Trade Organization in 2001. But the protectionist policies of his administration are pushing the two countries towards a new Cold War. While the US president is right in pointing out the disparities caused by globalisation, he has often failed to appreciate the positives of a free trade. If China has been able to lift millions out of poverty by becoming the manufacturing hub of the world, many Americans and people in developed and developing countries have also benefitted through access to a wider range of products and services. Companies have gained by outsourcing jobs, by moving their manufacturing base to other countries, including China, and slashing costs. It has helped them focus on core strengths and build better products and services. Yes, jobs have been lost. Lives have been disrupted but the number of people and families that have gained from a cooperative system exceed those hampered by its excesses. What policymakers missed doing then was to create avenues for people left behind by globalisation and helping them find gainful employment. Come to think of it, globalisation has become a victim of its own success.
Now, with supply chains being disrupted during the crisis and access to medical supplies affected, a number of countries are talking about building self-sufficiency into their models of governance. This could trigger more protectionism and undo many gains of an inter-connected global order. China has been at the receiving end as the Trump administration pins blame on Beijing for spreading the coronavirus. Chinese Foreign Minister Wang Yi on Sunday said that the US should stop pushing the two countries "to the brink of a new Cold War". Tensions between the two could worsen ahead of the presidential elections between Trump and his main rival Joe Biden seek to woo voters. Meanwhile, a realignment among nations can also be expected in the post-Covid era. However, much will depend on how Europe, Asia, and Australia react to the showdown between the two superpowers. China would like to influence globalisation on its terms. Would new blocs be formed? Which way will Russia go? All of these are questions that will be answered after the pandemic is controlled. The priority now is health and a quick economic recovery. More trade, not less will expedite the return to what will be the new world order. Another Cold War will only prolong the pain caused by the pandemic.