There have been some great facebook threads on the subject of globalization and how Papua New Guinea should respond accordingly. From the tsunami of wiping out domestic industry, multinationals grabbing land to fueling corruption. There are then the arguments of Brenton Woods Institutions spreading their hegemony. Norms that are unrealistic as they promote liberal economics (Washington Consensus.) So beckons the question, are these issues diabolical and catastrophic for PNG? My answer is no for the simple reason been, there appears to be gains and these gains need to be advanced though intelligent and creative policymaking.
There is a plethora of literature on both sides of the spectrum giving views on the good and bad sides of globalization, capitalism, Brenton Woods and international trade. From the high priest of Globalization Thomas Freedman’s “The World Is Flat”, provocative insights to the failure of Brenton Woods Institutions in Joseph Stieglitz’s Globalization and Its Discontent to Erik Reinert’s How Rich Countries Got Rich… and Why Poor Countries Stay Poor. A disposition of trade been responsible for perpetuating poverty.
Aside from literary works, Michael Moore’s documentary on Capitalism a Love Story as well as the Matt Damon narrated Inside Job are compelling cinematic works on where things have gone horribly wrong. Of course one can also lean on confessional semi autobiographies like Allan Greenspan’s Age Of Turbulence, who has been accredited to the father of deregulation and blamed by many as the person responsible for the current financial mess.
Like most folks, why bother reading all this, defer to the norm, air an opinion because I need to be heard. That’s all good, but what would it achieve when not all the issues are been considered. So here is my attempt to bring some clarity on this issue as I do feel if not considered in all its facets, will bring reckless policy and would indeed make our dear people suffer.
What are the Issues?
The term capitalism is in relation to a political ideology that promotes the idea of individual ownership and the promotion of wealth creation through it. So it looks to ensure there is less regulation stifling business transactions, cumbersome rules and less State supervision and intervention.
Following this ideology, globalization is the act of exporting this concept outside the internal borders of proponents of capitalism. Thereby promoting international trade, commercial practice and business norms to facilitate capitalism.
For such a process to occur, Brenton Woods Institutions, World Bank and International Monetary Fund and the World Trade Organization as well as other multilateral organizations facilitate treaties, programmes, and projects and where appropriate, develop regional or national integration solutions.
So What’s The Problem?
Like any ideology and system, it is prone to pressures that will challenge its practicality and functionality. Joseph Stieglitz’s book I mentioned previously is a must read as it eloquently details the failure of capitalism and globalization by solely making the implementation institutions responsible i.e. Brenton Woods Institutions. Examples of Argentina, Ethiopia and beloved PNG are all discussed. Whereby unsustainable fiscal and property reform, devaluing currency, austerity measures, the results have been devastating. Unemployment, civil unrest to wars.
The underlying problem has been the exclusive consideration of economics and not considering other factors such as cultural, social and political factors. The strong viewpoint was the basis of his sequel, Making Globalization Work. He does probe into deeper engagement on anthropogenic considerations issues and not exclusively rely on economics.
Such consideration of health, education, financial inclusion, cultural factors and others must be considered in appropriately applying economic development models. Thereby, moving away from the capitalistic ideology and formulate a combination of different systems. This in turn may have a domino affect in changing norms, programmes and projects in Brenton Woods Institutions and related trade and commercial practices.
But here is the challenge, especially for a nation like PNG; this particular consideration must come from Papua New Guineans. We must augment the ideology and system to suit our way of life.
Infusing PNG’s Way of Life in Ideology and Systems
Our forefathers were aware of these issues and in the CPC Report, cited cases of the traumas of Africa, Asia and Latin America, on the dangers of capitalism. They cited the complications multinational companies may bring and the importance of protecting land. These ideologies have evolved in to norms and feature in areas of land protection, investment rules and natural resource management.
They have been used the basis to interact in dealing in safeguarding our people from capitalistic approaches that is not consistent with our way of life, negative impacts of globalization, fight against Brenton Woods Institution polices that are inconsistent with our national interest and are to advocate our right to protect our domestic industries in international trade. Sadly, these norms are eroding and so one has to ask why this is the case.
I can only conclude by saying that we are not resourcing our time and energy in developing policy responses to maximize the benefits but rather have spent more time either looking at short-term objectives or crusading to all that it is indeed is an evil.
Policy Response To Maximize Capitalism, Globalization, Brenton Woods Institution and Trade
To be fully effective in providing policy responses, it must be inclusive of all stakeholders. From the Executive, legislature, judiciary, NGOs, Private Sector and regional blocs and organizations.
–Establishing an interagency and private sector committee;
–Build capacity of industry, commerce, trade IP administrations;
–Build capacity in compliance, monitoring and enforcement of protecting business interests;
–policy paper on micro and SME Development;
–Tax and other preferential treatment to them;
–promoting polices in technology transfer, information sharing and capacity building to systems to improve product development of domestic industries;
–Training on product and marketing development;
–Grants and other capital financing incentives;
–Export promotion and market access of exporting goods and services.
–Amend or enact laws to promote domestic industries;
–Conduct hearings to parliamentary committees on promoting and protecting domestic industries.
–Judicial system to facilitate appropriate alternative dispute and judicial pronouncement to commercial disputes;
–Build jurisprudence on commercial practice;
–Enforce reciprocal judgments of disputes relating to PNG businesses.
NGO And Private Sector
Encourage domestic industry to establish entities representing different sectors e.g. manufacturers, hotels etc;
•These entities may then form the basis to create standards, licensing bodies and liaise with government on industry support;
•Develop intra private sector relations on facilitating investment and business opportunities;
•Develop relations with legal professionals on assisting business and commercial law advice;
•Actively partake in formulating regional and international arrangements and agreements in trade, commerce and investment norms.
There is indeed positive side to this complicated system of rules and ideologies and we need to be clever in creating wins. Who knows, one day a Papua New Guinean may be inspired to write his tale on how they beat all odds to become a winner.