Crises tend to accelerate history’s momentum. Developments that would usually take a few decades, can now take place within a matter of hours, weeks or months. WWII helped accelerate the transfer of power between the British Empire and the US. History is full of other examples. This crisis should be no different.
We’ve witnessed in the past few weeks much futurology of what a post Covid-19 world will look like. From the end of globalisation to the rise of the great surveillance State – the imagination knows no bounds. Some profess the re-industrialisation of the West, others that China will emerge as the new world leader. But life is made up of so many unpredictable events – the unknown unknowns – that it is anybody’s guess as to who is right. History will be the ultimate judge.
I recall my university days, when a world-renowned history professor, published a book arguing that the Soviet empire would never collapse. It had been his life’s work. A week after publication, the Berlin Wall fell. So much for the unfortunate professor’s predictions. Who would have thought last November that over half the world would come to a grinding halt by March?
History is made by men, and their countless actions and choices. It is not pre-determined or written somewhere in stone. Governments and people make choices and it is these choices that ultimately shape our world. Hence the impossibility of knowing exactly what the future will bring.
Take the world political economy. Will we continue on our path of globalisation and greater integration of national economies or will this pandemic cause a knee-jerk reaction against connectivity and provoke greater autarchy and, with it, nationalism? There were already signs of this in a pre-Covid world. The phrase “America First” was Mr Trump’s campaign slogan in 2016. After his victory, the US, for decades, the traditional world leader and architect of the post WWII rules-based system, has withdrawn into itself. From multiple trade wars with China and Europe, to a renegotiation of NAFTA, making it in many ways a less liberal trade agreement, his stance on globalisation was all too clear. “We will build a wall” he repeated endlessly, which he eventually did. The perils of immigration were emphasized and the US border became thicker.
One notes with some irony that it may now be the Mexicans that are happy with the wall, given that Covid-19 is much more prevalent in the US than it is in Mexico, but I digress…
And of course we cannot forget the much dragged-out divorce between the UK and the EU or how little solidarity was shown between the northern States to their southern partners after the 2008 financial and economic crisis. This pattern still seems to be alive and well today.
Our prophets of doom call out that this new pandemic will further accelerate the end of globalisation. Garry Shilling writing in Bloomberg said: “The Coronavirus’s depressing effects on the global economy and disruptions of supply chains is no doubt driving the last nail into the coffin of globalists.” He touched on an important point here that has become glaringly visible with this crisis – the disruption to supply chains, especially those that guarantee important medical equipment.
Does this mean that countries will revert to home-shoring? In general terms I very much doubt it. Industrial and geo-political strategy will need to be revisited, and already we see calls for such action, but home-shoring most production is likely not to be on the cards. Countries will require larger strategic reserves of medical equipment – one lesson learned. They will also need to build more resilient and diversified supply chains in other non-strategic goods. By resilient I don’t mean they have to be produced at home, but the undue reliance on China may be rethought. A relocation to places like India, Bangladesh or Vietnam of factories and supply chains could occur. Maybe they will be the great economic “winners” of this pandemic.
The fact that governments were unable to supply critical civilian equipment to save lives will leave its mark. The solution to this is to build up medical reserves and make national health systems more robust. Not stopping the movement of goods, capital and people. The oil price hikes in the 70s did not dampen globalisation. Rather it made countries review their industrial and geo-strategic policies. In the long run, alternative sources of energy were developed. Those who could, created strategic petroleum reserves. It didn’t stop imports from other countries.
Technological innovation has made us more integrated. The very fact that people from all over the world can still be interviewed from the comfort of their own home during this period of lockdown is testament to that. It is true, however, that some view digital advancements as hyper competitive, operating in a zero-sum way, which typically does not apply to a goods producing economy. These technologies hold valuable data and can be used for national security and military related purposes. To have these in the hands of a foreign power is not wise. Equally, having our electric grid … in foreign hands may need to be rethought. The European Commission has been calling for a stop to further Chinese investment in the Euro-zone. Perhaps a smart move, especially given that there is little to no unfettered opening up of China to Western investment.
Having said all of this, the reader could be forgiven for believing that I am an advocate for less globalisation. On the contrary, I see Covid-19, as a lesson that greater connectivity is needed. This pandemic hit us all, young and old, poor and rich. No one is immune to it. We are, in the words of Pope Francis “all equally frail”. So too are countries. We are all in the same boat; we share the same future. Closing down boarders will not prevent a pandemic. The last time in history the world did not suffer from a pandemic was in the stone age and I wouldn’t recommend a return to such a state.
To deal successfully and promptly with this latest pandemic we need to have greater connectivity not less. We need to share information globally and reliably. Only then can we beat this invisible threat. We now know that one thing that happens to one person in any one country can bring the world to its knees.
We need to cooperate in the production and distribution of vital medical equipment, and make sure that equipment is available and shipped to where it is most needed. Panic and hysteria made some less enlightened souls hoard at a level that caused national shortages – toilet paper of all things – imagine what it did between States. The US federal government and the EU could have done with a more centralised and unified procurement system. But crises all serve this purpose. To learn lessons from mistakes made and do better next time.
We are only as strong as our weakest link. There is little point in controlling or even resolving the pandemic in our country if the world around us is falling apart. Africa will be the next calamity. The world needs to start thinking seriously about how to help the Africans deal with this if it wishes to put a full stop to this whole nightmare. We cannot and should not think that by looking inwards we will resolve anything.
Finally, a plan is needed to prevent an economic disaster. After 2008, global leaders came together to devise such a plan, and much graver consequences were spared. Today no such thing is happening. America has shied away from its traditional leadership role. China is hesitant and I’m not so sure many countries would willingly accept its legitimacy as the new world leader. If countries do not come together, we will be living with the consequences of this pandemic for generations. Covid-19 hasn’t necessarily doomed globalisation. It has taught us that cooperation is fundamental if we are all to survive. Regulation of international trade may need to be revisited and strengthened. Equally, the role of the United Nations and the WHO must be reassessed and made more effective.
Division between states cannot and should not become our new normal. This epidemic will pass, most of us will survive, but the choices we make today will shape our future and those of future generations.
An epidemic can accelerate some things that are already happening, making them irreversible. Equally, it can change the course of history. No one truly knows what tomorrow will bring. Beware of futurologists. Our tomorrow will be shaped by the decisions we make today as a society. Nothing is predetermined. We have the power to decide our future with the decisions we make today. Crises often lead to positive transformations in societies, making them more resilient. All we can safely say is that tomorrow will be different from today. Let’s hope, better.
