Seminar Mahbubani on Globalization 3.0
Who will be the main economic and political players in the world in the coming decades? Will the emerging countries in the East take control? Where does the rise of the East leave the West? These were just some of the issues addressed during the Globalization 3.0: Welcoming the East seminar, which was organized by Nyenrode’s Europe China Institute in collaboration with MeetIn, and held in Nyenrode’s Pfizer theatre on 7 October 2009.
Keynote speaker was Prof. Dr. Kishore Mahbubani, author of the book ‘The New Asian Hemisphere: The Irresistible Shift of Power to the East’ (2008). The seminar included special guest Mr. Jun Zhang, ambassador of the People’s Republic of China in the Netherlands.
Globalization 3.0: An introduction
The seminar began with Prof. Dr. Haico Ebbers, academic leader
of the Europe China Institute, introducing the concept of
globalization 3.0, which was initially formulated by New York
Times foreign affairs columnist Thomas L. Friedman in his book ‘The world is flat’. The phase of globalization
1.0 started with the discovery of America in 1492, Ebbers explained, with globalization initiated by countries. A
new phase, globalization 2.0, took off after WWII, when the Western victors of the war built global
multilateral institutions such as the IMF and the World Bank. In this phase, globalization was market-led.
With the Asian financial crisis at the end of the millennium proving that market forces alone were not able to bring
stability to the economic system, a third phase in globalization began: 3.0. In this phase it is not so much
governments and companies who are the driving forces, but individuals who take the lead by entering what Friedman calls ‘the flat world’, through opportunities created by technological innovations. One such technological development that contributes to this kind of globalization is Google, according to Ebbers, who notes that in 2006 there were 3 billion searches on Google, while one year later that number had risen to 30 billion. A global shift is on going and the world has already changed more than most of us think, he added, while comparing the number of patents and the rate of child mortality in several countries. Ebbers: “We are moving from an ‘American’ to an ‘emerging markets’ century. Looked at it in terms of GPD per capita, this shift will lead to a win-win situation for both the East and the West.”
Welcoming the East
Prof. Dr. Kishore Mahbubani, Dean and Professor in the Practice of Public Policy of the Lee Kuan
Yew School of Public Policy at the National University of Singapore, was a Singaporean diplomat for
several decades. He is the author of many articles and books, including ‘Can Asians Think?’ and
‘Beyond the Age of Innocence: Rebuilding Trust between America and the World’, and was included in
the Top 100 of Public Intellectuals by Prospect Magazine (UK) and Foreign Policy (US). After Prof.
Ebbers’ introduction, he took the floor with a lecture about the shift of power towards Asia.
Currently, in countries such as China and India, we are seeing an improvement in living standards of
10,000 per cent in one lifetime, Mahbubani pointed out. “Today, we are entering a new era of world
history,” was his main message. Although it is the end of the era of Western domination in world
history, it is not the end of the West: the West is still powerful. According to Mahbubani, the rise of
Asia is actually the return of Asia. From the beginning of the first millennium until the 1820s, China and
India were the dominant economic powers in the world. However, following the onset of the industrial
revolution, Europe (and later North America) rose to dominance. This means, in Mahbubani’s view, that the current emerging power of China and India is actually a return to the norm rather than a deviation from the norm.
But why is it happening now? Mahbubani believes the explanation to this question lies in the adaptation by Asians to what he calls the seven pillars of Western wisdom. He mentioned two of them: free market economics and the mastery of science and technology.
Today, the financial crisis is an example of the need for the world to create more global governance, Mahbubani continued. The need for global leadership has never been greater, he believes. Can the West provide this leadership? Mahbubani believes not, giving three reasons.
Firstly, the West has lost much of its credibility. Although only 12 per cent of the world’s population lives in the West, it was in the position to make the economic and political rules during the postwar era. According to Mahbubani, we have recently seen several cases of the West violating its own rules. He referred to the starting of the war in Iraq, which was neither in self-defense nor authorized by the UN’s Security Council. Furthermore, not a single European country had the courage to criticize the US on Guantanamo, he said. The second reason is because of a loss of confidence in the West. The belief in the free market has dropped in the West, Mahbubani believes. The population is frightened of liberalization due to a loss of confidence in their capacity to compete with other players on the world’s stage. Finally, there is a loss of competence. According to Mahbubani, many people had faith that western companies and governments would know what to do when an economic crisis hit. They proved they did not. Are the new Asian powers ready to provide some much needed leadership? No, they are not, Mahbubani believes, noting that both the Indian and the Chinese government are consumed with internal challenges.
While the need for leadership has never been greater than today, it seems that no party can provide it. This will result in more turbulence in the world in the coming period, Mahbubani believes. Still, he describes himself as an optimist rather than a pessimist. There is no need for fear of the shift, Mahbubani argued, since the greatest believers in stability are the new powers and they want to be responsible stakeholders. The new middle classes that are being created in the East are not interested in tensions, he added. Furthermore, young Asians are among the most optimistic in the world and want to create a better world order.
Ambassador Jun Zhang
The next speaker was Mr. Jun Zhang, ambassador of the People’s Republic of China in the Netherlands. He treats the subject of Chinese development from the perspective of the Chinese themselves. According to the
ambassador, China wants to play a role consistent with its development level. At the moment, China is still a developing country. With a population of 1.3 billion, many of them in poverty, China faces huge challenges and it
will take several generations to catch up with the West, he believes. China is not ready to be a super power,
neither is that China’s intention. This – combined with the economies of the West and the East becoming more and more interrelated – means there is no need for the West to fear the shift. And, Mr. Jun Zhang added: “We will continue to export shoes but we will never export our political system and our ideology.”
Discussion
After Mr. Jun Zhang’s speech, four experts commented on parts of Prof. Mahbubani’s work. The experts were:
• Mr. Henk Schulte Nordholt, China-expert and founder of Hofing Technology
• Mr. Gopal Ramanathan, partner at KPMG
• Mr. Eric Niehe, former ambassador in India for the Kingdom of the Netherlands and chairman of Nyenrode’s Europe India Institute
• Mr. Pablo Smolders, founder of consultancy firm Dutch
They discussed the rise of India and China and the implications for the West, and Mahbubani addressed the issues raised by them.
Commenting on Mr. Schulte Nordholt’s remarks, Mahbubani stated that Asia is more than a European concept and that there has been connectivity between Asian countries for a long time. He thinks that in the long run all states have to be democratic, although this might take a while for some of the countries in Asia. The US did not have women’s suffrage and black people voting overnight as well, he added.
Concerning a question raised by Mr. Gopal Ramanathan, Mahbubani said he believes that there is much more hope in India nowadays than there was in the late sixties. Today, people have more confidence.
In Asia the Netherlands has a relative positive image, Mahbubani says referring to question by Mr. Eric Niehe. The Dutch should take advantage of this goodwill. At the moment the Dutch do not show much awareness of the shift in balance between the West and the East. For instance, not enough young Dutch people go to Asia to study. While the Dutch have not woken up enough, in the EU as a whole the need for another view of the East is far greater. Maybe, the Netherlands can contribute to make the EU more receptive and change the EU’s closedness from within.
Mr. Pablo Smolders questioned the emphasis on economic growth in China en India. Aren’t there more important things in life such as health and happiness? In his answer Mahbubani referred to his childhood. He said that his sense of quality of life improved dramatically after having a flush toilet. Nowadays, about 30% of the people in the world have flush toilets. If this percentage would increase to 100%, this would mean a huge improvement of the quality of life in the world. In Mahbubani’s words: “For the poor eceonomic development means a lot.”
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