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It's back to the old world order
by g kohler
17 October 2003 14:30 UTC
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The article below by Gwynne Dyer (Canadian in London, UK) mentions a recent
study (Oct 2003) by Goldman Sachs investment bankers, which makes
predictions for the world system until the year 2050. The study results are
as if Goldman and Sachs had read AG Frank concerning ReOrient and I
Wallerstein concerning U.S. hegemonial decline.

Is World(-)System knowledge now mainstream?


article downloaded from: World Economist 16oct03

It's back to the old world order


THIRTY-THREE years after China launched its first satellite, a high-tech
boom box called Mao 1 that broadcast a tinny version of 'The East Is Red' to
an underwhelmed world, it has finally put a man into space.

But the pace is picking up. Beijing is planning to put Chinese yuhangyuan
(the Chinese term for astronauts) on the Moon in just another seven years.
If it stays on course, it will soon overtake Russia to become the second
biggest player in space - and around 2040, according to a study released
earlier this month by investment bankers Goldman Sachs, it will overtake the
United States to become the world's largest economy.

Even then China won't be the richest country in per capita terms, but it
certainly won't be poor any more. In terms of GDP per head, Chinese citizens
will be at about the same level as the richer European countries are now by
2050, the cut-off date of the Goldman Sachs study.

Other big developing countries like India and Brazil will only have reached
the same income level as present-day Portugal - but that's not so terrible
either, and there will be an awful lot of Indians and Brazilians by then.

The Chinese launch is telling us that the world is changing in a fundamental
way. Five centuries ago, on the eve of Europe's rise to world empire,
average incomes in China and India were about the same as average incomes in
Western Europe - and average incomes in the Muslim Middle East were probably
higher. Then, the Europeans burst out of their continent and overran the
planet. They and their overseas descendants ended up far richer than
everybody else, partly because of their empires and partly because they took
the scientific and industrial lead.

The new status quo has been around for so long that it has come to seem
natural, but it is ending now.

The Goldman Sachs paper is a sophisticated exercise in prediction that takes
into account factors like population growth and changing age structures,
capital accumulation and likely productivity growth, rather than just doing
straight-line projections of current trends.

It focuses on what it calls the 'Brics' - four lower-middle-income
countries, Brazil, Russia, India and China, that have big populations and
already have significant industrial and technological skills and resources.
And it tells us where it thinks we will all be in 2050.

The world's biggest economy will be China's, of course, with the United
States in second place (although America may still be China's equal in
technological innovation). India is not too far behind in size, and then, a
long way after the Big Three come Japan, Brazil and Russia. Bringing up the
rear, so far as the major players are concerned, are Britain, Germany,
France and Italy.

With the exception of the US and Brazil, 'New World' countries that were not
home to modern mass civilisations 500 years ago, it is a return to the same
list, in almost exactly the same order, that you would have drawn up in the
year 1500.

That makes a kind of sense. In a globalised society and economy where the
West no longer enjoys absolute political control, you would expect the
distribution of global power to return gradually to what it used to be, with
the big populations on the large land masses having greater wealth and power
than small Western European countries. But it will take a lot of getting
used to, especially for the Western countries that have had their own way
for so long.

Some of these predictions may not come true, of course, or at least they may
not happen within the chosen timeframe. China has had two disastrous
political adventures in the past 40 years - the Great Leap Forward and the
Cultural Revolution, each of which cost it at least a decade of growth. What
if it has another?

Brazil has been the promised land of the future for at least a hundred years
now, but its present never lives up to the promise. India has an abnormally
high level of corruption and a ramshackle education system (though it also
has the advantage of being the only Bric where large numbers of people speak
English, the global lingua franca).

Even Russia might go off the rails, though it seems least likely to. But
these are essentially details. Most of the Goldman Sachs predictions will
come to pass, even if some do not, and the world will still be a changed

What conclusions should we draw from all this, apart from the obvious one
that the first human beings on Mars will probably be Chinese?

One is that the real environmental crisis is coming at us even faster than
the pessimists feared: Four or five billion people in the Brics and other
Asian and Latin American countries, who will be consuming at current
European levels by 2050, will put huge additional stress on the environment.
The time for emergency measures is probably now - not that there is any real
hope of such a thing.

The second is that we desperately need to revive and refine the kind of
multilateral global governance for which the existing United Nations system
is a sketchy first draft.

The prospect of a world that is highly competitive economically and under
acute environmental pressure - and where there are five or six nuclear-armed
major powers, no longer contained within the old bipolar system of the Cold
War - absolutely requires an inclusive international system that works.
Rather like the one currently being destroyed, in fact.

And the third conclusion? Westerners had better start working on their

  The writer is a London-based independent journalist.

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