00:00 So our first thematic session is titled Reviving Multilateralism,
00:05 and our distinguished panelists will explore
00:07 real world examples of multilateralism in action,
00:10 the challenges of coordination,
00:12 and the lessons learned from both successes and setbacks.
00:14 The session's chair is Mr.
00:15 Matteo Bugamelli,
00:17 executive director and dean of the World Bank Board of Executive Directors,
00:20 and he'll introduce our panelists and chair the session.
00:23 Thank you.
00:30 OK.
00:32 Good morning.
00:32 Good morning
00:34 and welcome to the uh World Bank Group and to this ABCDe Conference.
00:39 So,
00:39 as I said,
00:40 my name is Matteo Buggamelli.
00:41 I'm the executive director
00:43 in the board of the World Bank Group representing,
00:45 uh,
00:45 Albania,
00:46 Greece,
00:46 Italy,
00:47 my own country,
00:48 Malta,
00:48 Portugal,
00:49 San Marino,
00:50 and,
00:50 uh,
00:51 Timor-Leste.
00:52 So today,
00:53 today I'm uh very glad and honored to share an interesting session on reviving,
00:58 uh,
00:58 multilateralism,
00:59 challenges and opportunity.
01:01 In a changing world.
01:02 So let me
01:04 introduce our speakers today.
01:07 We start from Danny Khua.
01:09 Danny Khua is Li Xing Professor in Economics
01:13 at the School of Public Policy
01:15 at the National University of Singapore.
01:18 Danny,
01:18 welcome.
01:24 Then we have uh uh Mazoud Ahmed.
01:27 Uh,
01:27 Masoud
01:29 is the President Emeritus of the Center for Global Development.
01:34 Masoud,
01:34 welcome.
01:39 Uh,
01:40 then Selina
01:41 Ho,
01:42 is the vice dean,
01:43 uh,
01:43 Dean's chair and associate Profession international Affairs at
01:46 the School of Public Policy at the National University
01:50 of Singapore.
01:54 Welcome,
01:55 Selena.
01:56 And uh
01:57 last but not least,
01:58 uh,
01:58 Xing Guan Tu,
02:00 uh Dean and professor at the China Institute for WTO studies at the University
02:07 of International Business and Economics,
02:09 uh,
02:10 uh,
02:10 where he has worked since 1996,
02:12 I understand.
02:12 So welcome,
02:13 uh,
02:13 Xinguang.
02:17 So as I said,
02:18 very glad and honored to chair this very interesting session.
02:23 I would say there is no better place than the World Bank
02:27 to talk about
02:29 multilaterally.
02:30 This is,
02:30 as we all know,
02:31 is the biggest multilateral development bank with 189.
02:36 Shareholders every day,
02:38 every week in my capacity as executive director
02:41 at the board of the World Bank Group,
02:43 25 board members representing those 189
02:48 shareholders are called to discuss strategies,
02:51 policies,
02:52 and projects that have an impact
02:54 on the poorest and the most vulnerable in
02:57 over 100 client countries.
03:00 What we leave
03:02 every day within this building is,
03:04 in my view,
03:05 one of the highest expression of multilateralism,
03:08 one where
03:09 different political views and perspectives must be
03:13 managed,
03:14 must be
03:14 overcome
03:15 to reach a compromise,
03:16 to reach a consensual
03:18 solution.
03:19 But we cannot
03:21 deny that today,
03:22 as we gather in an era marked by profound global interdependence,
03:27 but also raising.
03:29 Geopolitical tension,
03:30 we are all facing
03:31 a difficult situation where one where
03:35 I would say multilateralism is
03:37 more important than ever,
03:39 but at the same time is also more difficult than ever.
03:43 So this session aims at exploring the current state and
03:47 future state of multilaterally with perspective from global regional
03:52 viewpoints as you will see.
03:55 We will do it with our 4 excellent
03:58 guests.
03:59 We will start with
04:00 a keynote address by by
04:04 Danny and then 3 paper presentation
04:07 by the other guests,
04:08 and then after that there will be
04:10 a round table that I will share with some questions for our guests,
04:13 and then we will open.
04:15 for Q&A uh from you.
04:17 Let me just say a few words on our guest,
04:20 Danny.
04:21 Danny,
04:22 research interests lie in income inequality,
04:25 economic growth,
04:26 international economic relations with many
04:28 publications on top economic journals.
04:31 When looking at the complex topic like world order,
04:35 Danny brings an interesting economic approach to it,
04:38 focusing on global power shift and the rise of the East and alternative model of the
04:44 Global power relation,
04:46 as he will explain,
04:48 but he already talked about it this morning.
04:50 He analyzed the supply and demand of international system
04:54 contrasting the goal of the great powers and the needs of the global community.
04:58 So
04:58 we could not have a better
05:00 uh keynote speaker today.
05:04 Then our three panelists,
05:05 uh,
05:06 uh,
05:06 Masoud,
05:07 uh,
05:08 President Emeritus,
05:08 as I said,
05:09 of the Center for Global Development,
05:11 he joined uh CGD after capping a 35-year career
05:16 driving economic development policy initiative relating to debt,
05:20 aid effectiveness,
05:21 trade,
05:21 and global economic prospects at major international
05:25 institutions including the IMF,
05:26 the World Bank,
05:27 and DFIT.
05:28 As a leading expert on international development finance,
05:31 uh,
05:31 Masoud has served on a number of international committees and forums.
05:35 Currently he is policy advisor to the G20 high-level
05:38 Independent Expert Group on Strengthening
05:41 multilateral Development banks and co-chair
05:43 of the World Economic Forum Global Future Council on the Future of Growth.
05:49 Selina works on Chinese politics and foreign policy.
05:53 Specifically,
05:54 she is interested
05:55 in how China wields power and influence
05:58 via infrastructure and water disputes in Southeast Asia and South Asia.
06:03 Her work stands at the intersection of comparative politics and international
06:08 relations.
06:09 Xinuan,
06:10 uh,
06:11 as I said,
06:11 Dean and professor at the China Institute for WTO uh Studies,
06:15 is research and teaches focus on WTO,
06:19 Chinese trade policy,
06:20 US trade policy,
06:21 and Chinese US trade relations and government,
06:25 uh,
06:25 procurement,
06:26 is an expert on Asia Pacific economic integration and international trade.
06:31 So
06:32 with no further ado,
06:33 let me now move to our keynote speaker,
06:37 speaker Danny.
06:39 Thanks again for being with us today.
06:41 Over to you.
06:42 You have 15 minutes I can help you with with the time.
06:45 Thank you.
06:51 Thank you very much Matteo.
06:52 Um,
06:53 it is with great pleasure
06:55 that I get to address you again.
06:57 I can think of no audience better
07:00 to,
07:00 uh,
07:00 for me to,
07:01 to take these points to.
07:04 At the Lee Kuan Yew School of Public Policy,
07:06 we are an interdisciplinary institution,
07:08 so although I am an economist,
07:10 I am deeply embedded in the group of people who study geopolitics.
07:14 And while we sometimes get carried away,
07:16 we are studying geopolitics as a thing in and of itself,
07:19 multilateralism being a thing in and of itself.
07:22 I'm here today
07:23 because I want to convince you
07:25 that
07:26 the mission of the bank and institutions like the bank
07:30 for fostering economic development hinges critically
07:34 on the way in which we now move forward
07:37 constructing a new multilateral system.
07:40 So I want to make that argument to you
07:43 with 3 points.
07:45 The first point
07:47 is to say that
07:49 both demand
07:51 and supply matter.
07:53 And what I mean by this
07:56 Is that
07:57 the multilateral rules-based order.
08:01 Under which we have been lucky enough to live for the last 8 decades.
08:06 Produced not just
08:07 a rules-based system
08:09 for all nations,
08:11 small and large to deal with each other on equal terms.
08:16 It also produced
08:17 globalization,
08:19 open markets
08:21 and free exchange.
08:23 That provided
08:26 Elastic demand.
08:29 Invisibly
08:31 So that
08:32 your work and my work on economic development
08:36 could concentrate
08:38 on just
08:40 strengthening supply.
08:43 In other words,
08:43 what we did in terms of economic development
08:47 was to advance supply.
08:49 In the expectation
08:51 that demand
08:53 would be elastic
08:54 and forthcoming.
08:57 If you believe that model and I want to say
08:59 a few words that suggest to you why that's true,
09:02 then
09:04 The decline
09:05 of the rules-based multilateral order.
09:09 Means
09:10 that
09:11 in our jobs to advance economic development.
09:15 The focus
09:17 on simply raising supply
09:20 is no longer sufficient.
09:22 What do I mean by raising supply?
09:25 I mean all the things that we do in terms of capacity building,
09:28 improving the health of populations,
09:30 raising skills and education,
09:33 building connectivity and transportation infrastructure,
09:36 shifting the workforce
09:38 from low productivity activities
09:40 to high productivity industry,
09:42 all of that
09:44 is about advancing
09:45 supply.
09:47 We did that in the confidence
09:50 that at the end of this process,
09:52 demand
09:53 would be there for us.
09:55 So
09:56 this morning,
09:58 we discussed populism.
10:00 Populism
10:01 and angry population within our societies
10:05 can disrupt our supply,
10:07 it disrupts
10:09 the work that we do.
10:11 It can disrupt Bill Gates' efforts to eradicate measles.
10:16 Movements within emerging nations
10:19 that take up grievance
10:20 against the establishment
10:22 will disrupt supply.
10:25 But populism
10:28 It's about anger not just in populations,
10:32 but in anger across countries.
10:35 And populism
10:37 can disrupt demand
10:39 through protectionism in advanced economies,
10:43 withdrawal of America's benevolent hegemony
10:46 in
10:47 supporting the multilateral system.
10:50 We now are in a situation where our job as development professionals,
10:55 we need to go beyond what we have historically done.
11:00 Let me move to my second point.
11:02 To revive
11:03 multilateralism,
11:05 we need to unpack
11:07 the causes
11:08 for its rise and fall.
11:11 I want to argue here
11:13 that there is a paradox
11:14 in that how successful we have been as development professionals
11:18 has also brought within it
11:20 the seeds of an emergence of a kind of multipolarity
11:25 that threatens.
11:28 Certain parts of the multilateral system
11:31 that angers them,
11:32 that creates a populism across nations.
11:36 I will come back to this point
11:38 because I want to mention to you my 3rd point.
11:42 Which is
11:43 what do we do
11:45 going forward.
11:47 If the supply of multilateralism
11:50 has fallen,
11:52 What
11:53 can the demand side do?
11:56 What tools
11:58 are available now
11:59 to those of us
12:01 who continue to see benefit
12:03 from the rules-based
12:05 multilateral,
12:06 multilateral globalized order
12:09 that we have enjoyed
12:10 these past 80 years.
12:12 What can we do to reconstruct that?
12:15 We got a little bit into that a few minutes ago in the previous session,
12:18 but I want to flag for you,
12:20 that is where I am going to land.
12:26 Sorry,
12:26 I'm just checking the time.
12:29 OK,
12:29 let me now take
12:31 a few minutes.
12:33 Because I know the rest of the panel wants to get up here as well
12:36 to talk about
12:37 those two points
12:39 that I ended up with.
12:42 We need to understand
12:44 The reasons for the rise and fall
12:46 of the multilateral rules-based order
12:49 and we need to think.
12:51 In acknowledgement of those causes,
12:53 what we can do to repair it.
12:58 One of the key points in understanding
13:01 the fall
13:02 of the rules-based multilateral order
13:05 is that this is a situation.
13:07 Where economics
13:09 and geopolitics
13:11 have aligned.
13:13 As economists,
13:14 we are often used to making an argument
13:17 where our models say such and such an outcome
13:20 is optimal,
13:22 such and such an outcome is the right policy.
13:25 But then we say,
13:26 ah.
13:28 But geopolitics
13:30 messes this up.
13:32 It's as if we think geopolitics is irrational.
13:36 It's as if we think,
13:38 as I said a few minutes ago,
13:40 that geopolitics is the dustbin of bad economic ideas.
13:45 It is not.
13:47 In the current situation,
13:49 we need to understand why economics and geopolitics
13:53 have aligned so ruthlessly
13:56 to try and bring down the globalized rules-based multilateral order.
14:02 Multilateralism
14:04 It's a system
14:05 that provides
14:07 a level playing field.
14:09 That includes open trade.
14:12 Multilateralism
14:14 is a commitment.
14:15 To peace
14:17 and to the principle of dispute resolution
14:20 by consultation.
14:22 Not
14:23 by might makes right.
14:26 Multilateralism is the understanding
14:29 that collaboration
14:31 is the default mode
14:33 of how nations
14:34 engage with each other.
14:37 Let me make it plain,
14:38 I live in a
14:39 country
14:41 that is 720 square kilometers
14:43 in land area.
14:45 It is
14:46 a population of under 5 million people.
14:50 Security
14:51 for small states
14:53 like mine.
14:55 The ability
14:56 to engage in economic exchange with the rest of the world.
15:01 Hinges critically
15:03 on the rules-based multilateral order.
15:05 Singapore and states like Singapore
15:08 continue to believe in the principles of free trade.
15:13 Open markets and competitive advantage.
15:17 We understand
15:19 that we need to take care of our population.
15:22 And Singapore takes that seriously.
15:24 But this
15:25 is a resolution
15:27 that needs to take in not just states like Singapore,
15:30 but everybody else.
15:33 Now the world after
15:35 World War 2,
15:36 the international system after World War 2
15:39 was obviously
15:40 architecture by the United States.
15:43 It did that on the basis of good economic thinking.
15:48 That was important for the development of small states like Singapore,
15:52 but the United States did what it did.
15:55 Also
15:56 for geopolitical reasons.
15:59 After the Second World War,
16:01 America was embroiled in the Cold War with the Soviet Union.
16:05 The Soviet Union was against free markets and open trade.
16:09 It was convenient
16:11 for the United States to be for free markets and open trade.
16:16 And the United States was the engine that drove the development of GATT
16:20 and then subsequently
16:21 the WTO.
16:24 Today,
16:24 the economic situation is different.
16:26 The rival,
16:27 as it were,
16:28 is not someone that denies free markets and open trade.
16:32 The rival is someone who believes ruthlessly
16:36 in open markets after a period
16:38 where you initiate new industries
16:41 through industrial policy.
16:43 It is a very different economic world
16:46 and unless we in the rest of the world,
16:49 Singapore,
16:50 Southeast Asia,
16:52 The European Union and America,
16:54 figure out how to deal with this world,
16:56 which is ruthless in open markets and free trade,
16:58 which used to the
17:00 ideals that we have had
17:02 for the belief in the economic principles of globalization,
17:06 we will not be able to navigate this going forward.
17:10 Trade dislocation.
17:12 As a result of the China shock
17:14 is real.
17:16 America legitimately worries about China stealing its jobs.
17:24 Hollowing out this industry,
17:26 turning into ghost towns that were once thriving
17:29 middle-class American communities.
17:31 All nations in the world
17:33 are worried
17:34 about the economic progress of China.
17:38 But we need to engage with this in a way that raises
17:42 ourselves,
17:43 raises our productivity,
17:46 allows us to compete
17:48 with a ruthless
17:50 economic rival.
17:51 We cannot close in.
17:54 Against open markets
17:56 and attempt to undertake actions that do down that rival,
18:00 we need to rise to the competition.
18:04 Let me end,
18:05 let me conclude.
18:08 America
18:09 and all other nations.
18:11 Feel threatened
18:13 by an economic force
18:15 that we had not seen previously.
18:19 We need
18:20 to be able to figure out how to deal with that.
18:23 We need to work out a bargain
18:25 where we don't feel insecure from competition,
18:28 but China
18:29 and other large emerging nations are allowed to continue to grow.
18:35 We have not worked out that bargain,
18:37 but we need to do so.
18:39 If I may,
18:40 chair,
18:41 let me take 15 seconds,
18:42 if I may,
18:43 to say
18:44 3 no's and 2 yeses
18:47 on how we can navigate this.
18:51 Small nations,
18:52 those nations who are now outside of the front lines of this competition,
18:57 need
18:58 to think about how we build back the best of the rules-based multilateral order,
19:04 even if the universal rules-based multilateral order is no longer available to us.
19:09 What that means
19:11 is that we shouldn't be thinking
19:13 about competition
19:14 as standing across from a great power on a nuclear battlefield.
19:19 That does not do us any good.
19:21 Do not go into
19:23 building a rules-based order
19:26 by frustrating
19:27 a great power.
19:29 You've got to figure out a smarter way to do that.
19:32 At the same time,
19:34 don't fall
19:36 into
19:37 Thucydides fallacy thinking.
19:40 Thucydides said
19:42 the great powers do what they will.
19:45 The rest of us suffer what we must.
19:48 The rest of us must at this point in global history.
19:52 Stand together.
19:54 Not just as price takers
19:56 but to exercise agency.
19:59 My colleague from the Lee Kuan Yew School.
20:02 Selina Ho will tell us in a few minutes
20:05 about ASEAN centrality and regionalism as a manifestation of this.
20:10 My final no
20:12 Do not give in to bullies.
20:16 Do not appease a bully
20:19 because
20:20 the lesson they take from that
20:21 is that they can come back.
20:24 And bully you once again.
20:26 My two yeses and this is where I conclude.
20:29 Let's think about building
20:31 systems
20:32 of pathfinder
20:34 multilateralism.
20:36 Multilateralism that keeps to WTO like rules.
20:41 But where we can,
20:42 we do not get disrupted
20:44 by objectives.
20:47 We are able
20:48 to find a way forward
20:50 and again
20:51 regionalism
20:52 and other similar models that we are trying to build in
20:55 East Asia and Southeast Asia can provide examples of this.
21:00 And 3rd,
21:01 and I mean finally,
21:02 my 2nd yes.
21:05 Look
21:06 for models of inadvertent cooperation.
21:11 A fallacy in thinking
21:13 is that the rules-based multilateral order.
21:16 It's an orgy
21:18 of collaboration and cooperation.
21:22 If it does look that way,
21:25 it is because it is in the incentive
21:27 for every agent to behave that way.
21:30 But we can look for ways to elicit
21:34 that kind of cooperation.
21:36 Even if
21:37 nations don't agree with each other.
21:40 The example that I told you about America building
21:44 the globalized multilateral rules based order was exactly such an example.
21:48 America did not agree with everyone else in the world,
21:51 but inadvertently all of us cooperated
21:54 in building a system
21:56 that worked.
21:58 Look for ways in which to modify that,
22:00 but again
22:01 to elicit inadvertent cooperation
22:04 where nations
22:06 will end up doing the right thing.
22:09 Even if it's for the wrong reason.
22:12 We need to revive multilateralism.
22:15 Thank you all very much.
22:22 Thank you,
22:22 thank you very much,
22:23 uh,
22:23 Danny,
22:24 very,
22:24 very insightful,
22:25 uh,
22:26 uh,
22:26 reflection.
22:26 So let's now move to the three papers presentation.
22:29 We start with Mazoud that I'm sure
22:31 has carefully listened to,
22:32 to Danny has a strong opinion on the state of,
22:35 uh,
22:36 multilateralism on the main challenges,
22:38 opportunities,
22:38 and,
22:38 and alternatives.
22:39 Mazo's paper title is
22:41 Is multilateralism whenever we can or only when we
22:46 must.
22:46 So Masoud,
22:47 over to you,
22:47 15 minutes for you.
22:54 Thank you very much.
22:56 Mate,
22:57 thank you,
22:57 Danny.
22:59 So,
23:00 I want to make uh
23:02 a couple of points
23:03 in reaction,
23:04 partly to
23:06 what Danny said and
23:07 partly picking up on the earlier exchange between
23:11 The chief economist and chief intellectual thought
23:14 keeper of the World Bank in the Mid
23:18 and Dany.
23:20 And my point,
23:22 the first point I want to make is that
23:26 2025 years ago,
23:28 whenever we faced a problem.
23:32 A new issue came up.
23:34 Our first go to thought was to think of a multilateral
23:40 approach to dealing with that problem.
23:43 And often that meant setting up a new institution to deal with that problem.
23:49 She wanted to deal with the problem of
23:51 HIV,
23:52 malaria,
23:53 TB,
23:54 set up the Global Fund.
23:56 Want to deal with accelerating educational attainment out of GPE.
24:01 Want to deal with the immunization,
24:03 vaccination
24:04 set up Gavi.
24:07 And if you wanted to come up with a bilateral,
24:10 a unilateral solution,
24:13 you had to make a case
24:14 as to why that was better than the default option of going collective.
24:21 Today,
24:21 I think we've turned that
24:23 on its head.
24:25 So today,
24:28 If you want to give me a solution,
24:30 if I'm a
24:32 politician and you're a civil servant,
24:34 and
24:35 so I've got this problem I want to deal with,
24:37 then why don't we set up our own
24:40 national development bank to do this,
24:42 let's say.
24:44 You come along and say,
24:45 well yes,
24:45 minister,
24:46 but before we set up a national development bank,
24:48 you know,
24:48 there are all these regional banks,
24:49 and I'm like,
24:50 why do I want to join these regional banks?
24:53 Then I won't be able to do what I want.
24:54 So
24:55 now
24:56 we have to make the case
24:59 for a multilateral or collective approach
25:02 rather than take it forgive
25:05 and
25:05 it doesn't mean that we won't be doing multilateral or collective approaches.
25:11 It just means that we shouldn't start from the presumption.
25:15 That the answer will be collective.
25:18 So that was a little bit the title that I
25:22 had for this talk,
25:24 and
25:25 Now,
25:26 also collective
25:28 used to mean
25:30 the more the merrier.
25:31 The global system was better than regional,
25:34 regional is better than sub-regional.
25:36 Now,
25:37 collective will be whatever works best
25:41 for the problem that we're trying to address.
25:45 For some things it will mean global.
25:47 It's very hard to think of
25:49 some problems being solved without
25:52 almost everybody being on board.
25:56 For others it may mean
25:58 regional,
25:58 it may mean
26:00 minilateral,
26:01 plurilateral,
26:02 regional,
26:03 I mean there is a list of names in recent.
26:06 Uh,
26:06 if you look at,
26:07 just go through articles on
26:09 the new multilateralism and Google that and you'll find
26:13 more new terms on this than
26:15 issues-based coalitions,
26:17 value-based coalitions,
26:19 coalitions of the willing,
26:21 coalitions of the unwilling,
26:22 you know,
26:23 there's a whole group now,
26:24 and my view is
26:26 they'll all have their place
26:28 in different ways,
26:29 but the function will be different.
26:32 Which brings me to the second and somewhat larger point.
26:37 And that is that
26:39 We keep thinking
26:41 there's a little bit of a disconnect I see in our thinking.
26:45 We say the current system,
26:47 global system,
26:48 rules-based order
26:50 has a hegemon that was an anchor.
26:54 And then they created global public goods.
26:58 Which included security,
27:01 financial clearance system,
27:02 safety net.
27:03 Mohammed El-Erian talked a bit about it this morning.
27:08 And then in the exchange between Danny and uh
27:11 and In the bit it came up.
27:14 And we are sort of saying well that
27:16 that rules-based global order
27:20 is
27:21 now not so effective,
27:23 both because the hegemon is no longer as interested in
27:27 in playing that role,
27:30 wants to have a different kind of relationship,
27:31 wants our relationship
27:33 with the rest of the world
27:35 of being a large and strong player in the system
27:38 rather than the umpire and keeper of the system.
27:43 And
27:46 What should that lead to?
27:48 So there is one track which is Danny the way I sort of interpreted your
27:53 your clarion call for well let's
27:56 get everybody to come together and build a better system.
28:01 That would be great if we could.
28:04 I was somewhat more
28:06 uh
28:08 Uh,
28:09 shall we say,
28:10 uh,
28:11 not pessimistic but
28:12 down to earth sense that.
28:15 I think that any
28:17 if we go forward,
28:18 there's one set of views which is let's have a global system without the US.
28:23 Right,
28:24 let's let's define a set of rules in which
28:27 The US doesn't want to be the hegemonist.
28:29 The rest of us get together and create
28:32 a set of rules that we all can live with,
28:34 and they'll be,
28:36 may not be,
28:37 um.
28:39 Perfect,
28:39 but it'll get us
28:41 through the system.
28:42 And I think there is no doubt that on things countries will come together
28:48 and find ways to work together.
28:53 Mostly it will be subgroups of countries in my view,
28:56 not the whole world.
28:59 But it won't be a global order.
29:03 That challenges the existing global order.
29:06 Because the existing global order is not disappearing overnight.
29:10 The US is not going to be happy to sit outside
29:14 some alternative global order that everybody else will create.
29:19 And the other countries
29:21 who all want to maintain reasonably good relationships with the US,
29:26 which is still the largest,
29:27 most powerful economy in the world,
29:29 are not going to be so happy to create some alternative global order,
29:33 the definition of which is this is the global order that excludes the US.
29:38 So I don't think this is a feasible
29:40 approach to to think of how to do it.
29:44 Then there is a sort of view which is uh
29:47 Well,
29:47 maybe,
29:48 you know,
29:48 we will end up with uh
29:51 Two zones,
29:53 the sort of division of the world into a Chinese-led global order,
29:57 order,
29:58 and then a
29:59 US based or some other.
30:02 Western
30:03 order.
30:04 You see,
30:04 if you talk to any emerging market,
30:06 they're not that interested in being part of either zone.
30:10 And they would not be enthusiastic supporters of
30:14 of a
30:15 um
30:17 One
30:18 being
30:18 excuse me,
30:19 being in one zone
30:20 or the other,
30:21 they want to be able to trade with both because
30:23 it's important for them to have relationships
30:26 with
30:27 China as major economy and with the
30:32 Europeans and with
30:33 the US.
30:35 So the only way I personally see this moving
30:39 forward is that we should stop using the word
30:41 order in the singular.
30:44 We should basically be moving to a series of overlapping
30:49 sets of rules,
30:51 networks,
30:52 which will govern relationships across countries,
30:56 across groups of countries.
30:58 And each country can be part of
31:02 more than one of these networks at any given time.
31:06 Sometimes those networks will actually
31:09 Appear to have competitive
31:12 objectives,
31:13 but individual countries will be able to be part of them
31:16 regardless.
31:18 Uh,
31:18 if you look at,
31:18 you know,
31:19 a country like India is part of Quad and is part of BRICS at the same time.
31:24 And I think that will be the way in which people will
31:28 begin to
31:29 function and operate
31:31 and that model.
31:33 Of multiple overlapping somewhat messier
31:38 sets of rules.
31:40 is one
31:41 that will require adaptation for individual countries to work with.
31:46 Some countries are actually pretty comfortable working
31:50 with multiple rules and orders.
31:52 In fact,
31:53 if you think about it,
31:55 The degree to which we mourn the demise of the existing
32:00 rules-based order
32:02 is partly a function of how central we were in that order,
32:05 the Europeans and
32:07 the US,
32:08 uh,
32:08 US less so now,
32:09 but the Europeans particularly worry about the loss of
32:12 the global order because it's central to it.
32:14 But the further away you get towards the periphery of the.
32:18 Of the people that are countries that are covered by that order,
32:22 the less of an emotional attachment there is to the order.
32:25 It's a very useful thing to have,
32:27 but
32:28 they don't have the same sense of ownership of the order.
32:31 There is also a greater degree of comfort of living in a world of disorder.
32:36 Because your daily life,
32:39 if you live in an emerging market of developing country,
32:42 you don't have a rules-based order governing your internal operations as much,
32:46 you know the rules don't quite operate so well,
32:49 the courts and judiciary are not as reliable
32:53 in in
32:55 interpreting
32:57 and sustaining rules,
32:59 so you learn to navigate without rules.
33:03 I mean if I try to cross the street and
33:06 In,
33:07 uh,
33:08 let's say in Paris,
33:09 I wait for a sign that says walk and don't walk before I cross the street,
33:13 you know,
33:13 it's a set of rules.
33:15 If I wait for the don't walk sign to change
33:17 to walk when I'm walking the streets in Cairo.
33:21 I'll be waiting a long time
33:23 and if I cross just because the sign says walk.
33:27 There's a very high risk I'll get run over.
33:30 So basically I've got to navigate my way across the street.
33:35 And therefore I'm a little bit more
33:37 comfortable with navigating my way internationally also
33:40 and living with multiple orders and rules.
33:43 So I guess my,
33:44 my point,
33:45 Danny is that it would be,
33:48 it would be great if we could all come together and form this global order
33:53 which would be
33:54 the better,
33:57 more just equitable,
33:59 taking more account of
34:01 domestic
34:02 inequalities as well.
34:05 But I think for the next decade,
34:07 we're going to live in a world
34:09 of messy,
34:10 multiple overlapping
34:13 orders
34:14 and we will have to
34:17 navigate our way through that.
34:19 And therefore,
34:20 just to end on it.
34:22 This is a very difficult world for
34:25 international institutions
34:27 to operate in.
34:30 We,
34:31 we are basically operate by having a set of norms,
34:34 rules that
34:35 tend to be the ones that historically have been global
34:39 and historically have been all our shareholders have signed up to
34:43 and now if we start walking into a world where trading
34:46 rules are different across different places and across different groupings.
34:51 How are we going to give the best advice to individual countries
34:55 and how are we going to take a view on whether or not those policies are effective
35:00 is going to become much more challenging.
35:02 So
35:03 I do feel that we in international institutions
35:08 also need to think about how to operate
35:11 in a messier world
35:14 while
35:15 We do all the good work
35:17 that will lead us to the point where we can go from being messy to being
35:22 reunited again,
35:23 but in a sort of better global framework.
35:27 Thank you.
35:32 Thank you,
35:33 thank you very much,
35:34 Mazud.
35:34 So we have,
35:35 uh,
35:35 had the meat to our discussion.
35:38 So,
35:38 uh,
35:39 let's move now to Selena.
35:40 Um,
35:41 uh,
35:41 Mazo talked about various alternatives,
35:43 uh to multilateralism.
35:44 One of those is,
35:45 uh,
35:46 regionalism.
35:47 Uh,
35:48 so we are now glad to hear your perspective from the South Asia,
35:52 uh,
35:53 uh,
35:53 region and actually your paper is exactly on regionalism,
35:56 multilateralism,
35:57 and the experience of South Asia.
35:58 Celine,
35:58 over to you.
36:09 OK.
36:12 I'll do the slides from here,
36:13 um.
36:14 I have to say that um this is an unusual company for
36:18 me because I'm a political scientist and I am a theory person.
36:22 So this is uh a group of economists I'm in the midst of a little fearful,
36:26 but I'll try my best.
36:28 I'm also sitting right in the middle of Danen.
36:32 And Masood having their debates,
36:35 um,
36:35 but I'm actually not,
36:37 um,
36:38 I don't see their viewpoints as completely different.
36:41 Um,
36:41 I'm advocating here
36:43 for a messier world,
36:45 but advancing to some form of order.
36:48 So I don't think that there is a fundamental difference between the two of you.
36:52 But let me,
36:53 let me say that my central proposition
36:56 And in my presentation,
36:58 it's really about devolving authority
37:00 and resources to regions to uphold multilateralism
37:05 and why we should do that and how we can do that.
37:08 Now,
37:08 let me begin by explaining why regions,
37:11 why
37:12 are regions important and why,
37:14 uh,
37:15 are they,
37:15 why do we need them
37:17 to uphold multilateralism.
37:20 Now we all know and as Masood and and Danny was already talking about,
37:24 we are in a transition.
37:26 This is not just a power transition,
37:28 but an order transition,
37:30 OK.
37:31 We have moved from a bipolar world
37:34 during the Cold War to a unipolar moment,
37:36 um,
37:37 with the United States undergirding the structure that we know.
37:41 We are now in a different transition
37:43 and this transition is a very,
37:45 very uncomfortable one
37:48 for most of us who have lived through,
37:50 uh,
37:50 the 20th century.
37:52 If you are born
37:53 In 2000s and after,
37:54 you know,
37:55 this is not new to you,
37:57 but for us who are older,
37:58 this is very uncomfortable.
38:00 Now this,
38:01 this transition
38:02 is going to be a protracted one.
38:05 OK,
38:06 I would say 10 years,
38:07 I will say 20 years
38:09 or more.
38:10 OK.
38:11 This is going to be a very protracted transition
38:13 and that final shape of the order will likely be,
38:16 in my opinion,
38:17 multipolar.
38:19 And this is not just my view,
38:21 but a view that is quite prevalent
38:23 in Asia,
38:24 in Europe,
38:25 people that I have spoken to.
38:27 What does it mean to be multipolar?
38:29 It means that you will be
38:31 a time and order that's less dominated by great powers.
38:35 There will be more agency for medium and smaller states,
38:39 primarily because
38:41 the nature of power is much more diffused.
38:45 And there is no
38:47 single
38:47 hegemonic state
38:49 or even two states
38:51 that is likely to undergo this order
38:54 in the future.
38:56 It will be multiple poles.
38:58 There is no single hegemonic state,
39:01 nor even two states that are going to undergo disorder.
39:04 So with power that is more diffused
39:07 and responsibilities that are more dispersed,
39:10 what does this mean?
39:11 It actually means that regions are going to play an important role,
39:14 because if we are not talking about great powers,
39:16 we are talking about major powers,
39:18 uh,
39:19 middle powers,
39:20 smaller states.
39:20 So regions are going to rise in importance
39:23 and it will continue to grow in importance in the future.
39:27 Multilateralism was important at the global level,
39:30 therefore needs to be regionalized,
39:33 and it is regionalized as it is,
39:34 but moving forward,
39:36 we might have to lean more
39:37 on regionalism
39:38 as an answer to our problems.
39:41 We know why multilateral,
39:43 multilateral matters as John Ragi has told us.
39:46 Ragi told us,
39:47 and I quote,
39:48 defining and stabilizing
39:50 Uh,
39:51 international property rights,
39:52 solving coordination problems,
39:54 and resolving collaboration problems.
39:56 Those are the reasons why multilateralism matters.
40:00 But why are regions and regionalism important
40:04 and how does regionalism,
40:06 um,
40:07 Help uphold multilateralism.
40:10 Regionalism,
40:11 in my opinion,
40:12 is multi
40:14 multilateralism at the regional level.
40:16 The focus is really on regional integration
40:19 and regional institutions.
40:21 What is the role of regions in
40:22 upholding global institutions and global governance,
40:25 for instance?
40:26 Well,
40:26 regional institutions can complement
40:29 and support the work of global institutions
40:31 at a time when global institutions are plagued by great power rivalry
40:36 and uh institutional paralysis and fragmentation.
40:40 Strengthening
40:41 regionalism and regional institutions will help rebuild
40:45 support for multilateral institutions and solutions.
40:50 Now,
40:50 moreover,
40:51 regional institutions have certain advantages over global institutions.
40:56 The obstacles to collective action are reduced
40:59 as countries can organize themselves more quickly
41:02 and efficiently at the regional level than at the global level.
41:06 Regional institutions also have the advantage of proximity
41:10 to the source of global problems.
41:12 They are closer to the ground,
41:14 they can diagnose,
41:15 mitigate,
41:15 treat and prevent future
41:17 occurrences more accurately and rapidly.
41:20 Now,
41:20 regional institutions are also closer to non-state actors,
41:24 and we know that non-state actors have become important,
41:27 uh,
41:27 in the international,
41:28 in on the international system.
41:31 Regional institutions are more capable of representing these social actors,
41:36 but critically among all these reasons,
41:39 and this is what I am going to
41:41 be uh focusing on for the last few minutes of my
41:44 presentation,
41:45 is that we need to rely more on regions
41:48 to uphold materialism
41:51 as the incubators of innovation.
41:53 They are prolific in producing novel situations
41:56 and at the same time providing a testing,
41:58 testing site for them.
42:00 Now this incubators of innovation is what
42:03 Danny is referring to as pathfinders.
42:05 He calls it pathfinders,
42:06 I call it incubators of innovation.
42:09 With a lesser number of veto actors and veto points at the regional level,
42:14 regional institutions can also more quickly
42:17 course-correct when needed compared to global institutions.
42:21 Now,
42:21 there are particularly 3 challenges in which regions have been advancing
42:25 and moving forward,
42:27 and I'm going to draw some examples from Southeast Asia for this presentation.
42:32 They have been very innovative,
42:33 uh,
42:33 very,
42:34 uh,
42:34 uh,
42:35 forward-looking,
42:36 creative,
42:37 3 areas in upholding free trade and the global trading system.
42:40 Number 2,
42:41 in the governance of new technologies and new forms of the economy
42:45 and also
42:46 thirdly in upholding a rules-based order.
42:52 So the first
42:54 The first
42:56 is a free trade and global trading system.
42:58 Countries at the regional level can work
43:00 together to ensure that the global economic system
43:04 remains open
43:05 to cross-border flows of trade and investment.
43:07 The WTO cannot perform this role as it has been under siege since the late 1990s,
43:13 failing to make advancements towards trade liberalization.
43:17 Regions by contrast are particularly effective
43:20 in producing forward-looking multilateral free trade agreements,
43:24 and South Asia is the vanguard of this
43:27 kind of agreements.
43:29 It is the driver of the RCEP,
43:31 right,
43:32 which is,
43:32 which builds on existing ASEAN free trade agreements with its trading partners,
43:36 China,
43:37 Japan,
43:37 South Korea,
43:39 Australia,
43:39 and New Zealand.
43:40 Bangladesh,
43:41 Chile,
43:41 and Sri Lanka have applied to join the RCEP.
43:45 There is also the possibility of the United Kingdom joining the bloc.
43:49 Their membership will enhance and expand the scope and influence of the RCEP.
43:55 Now,
43:56 regional states,
43:57 particularly from ASEAN,
43:58 4 ASEAN states
44:00 and 3 Latin American countries,
44:03 uh,
44:03 make up more than half
44:05 of the 12 member
44:06 CPTPP
44:08 and the CPTPP is regarded as the gold standard
44:13 for trade liberalization
44:14 and uh uh market liberalization.
44:18 Now these multilateral trading regimes are the antithesis
44:22 of protectionism and terrorists.
44:25 We must leverage them
44:26 to uphold free trade
44:28 and promote
44:29 cross-regional integration.
44:31 The RCP and CPT CPTPP can act stabilizing forces
44:36 in the ongoing tariff wars,
44:38 reciprocal wars,
44:39 or reciprocal tariff wars or whatever you want to call it.
44:43 Now collective action through these platforms should be a priority,
44:46 even as individual countries
44:49 go around negotiating with the Trump administration.
44:52 This platform should push towards connecting with Europe,
44:56 with the Middle East,
44:57 with Africa
44:58 and other regional trade initiatives,
45:00 expand global supply chains
45:02 and advance
45:04 trade.
45:05 Convergence of trading rules and standards across regions is necessary
45:10 so that we can avoid fragmenting
45:12 the global trading system.
45:14 Once these rules are tested and established,
45:16 they can be brought back to the WTO.
45:19 For negotiations
45:21 and as evidence of success.
45:23 Now the second area that regions have been particularly good at is in,
45:28 uh,
45:29 governance of emerging technologies and new forms of economy.
45:32 Now these new forms of economy,
45:35 emerging technologies,
45:36 they are posing significant risk to human civilization.
45:40 Setting standards and ethical principles and how you deal with AI,
45:44 biotechnology,
45:45 and rules and regulations for the protection of personal data
45:49 are falling behind the development of these new technologies.
45:52 Now regional groupings have really been in
45:54 the forefront of efforts to set standards for
45:57 the digital economy,
45:58 for instance.
45:59 In 2020,
46:01 Chile,
46:01 New Zealand,
46:02 and Singapore
46:03 signed the digital Economic Partnership agreements.
46:07 ASEAN itself,
46:08 the Association of Southeast Asian Nations,
46:11 also launched negotiations for the world's first region-wide
46:15 digital economy framework agreement in 2023.
46:20 This is aimed at strengthening regional digital
46:24 integration and transformation in Southeast Asia.
46:27 Now for ASEAN,
46:28 this is a game-changer.
46:30 It will be a game-changer
46:32 for uh economies in the region,
46:34 for the,
46:35 for the region to advance um and deliver
46:39 uh
46:39 seamless
46:40 goods and services across borders
46:43 and
46:43 to and also data underpinned by rules and regulations.
46:48 We believe that this will be a game-changer.
46:51 Now these initi initiatives will help
46:53 mitigate regulatory fragmentation resulting from tariff wars
46:58 and technological de-risking.
47:00 Now for the last area that I think that regions can
47:03 do very well in drawing again from Southeast Asia and from ASEAN
47:08 is to uphold the rules-based order.
47:11 Now,
47:12 I think most of us
47:13 can agree that the part of the current
47:16 international order or the international order that's passing
47:19 is that we like the rules,
47:21 right?
47:21 I mean we are multilateral organization right now,
47:23 we like rules,
47:24 right?
47:25 Rules cut transaction costs,
47:26 ensure predictability,
47:28 protect small states against the rule of the jungle,
47:31 mitigate the effects of raw power and coercion to ensure
47:34 that there is a more equitable and just world.
47:37 Now regions can be incubators of these
47:39 innovative mechanisms for ensuring a rules-based order.
47:43 In Southeast Asia,
47:44 we have a set of informal and consensus
47:47 building norms known as the ASEAN way.
47:50 And the ASEAN has prevented disputes among states from erupting
47:54 and destroying regional peace.
47:56 Now this is notwithstanding the situation in Myanmar
47:59 or the more recent clashes between Cambodia and Thailand
48:03 over pre-Viha.
48:04 Those have a lot to do with internal politics.
48:07 But region-wide,
48:09 we did not see a situation of
48:11 uh wars and open conflict,
48:13 right,
48:14 since the end of the Cold War.
48:16 Now drawing from ASEAN's experience,
48:18 we need to rethink the concept of law
48:21 and what it means to have a rules-based order.
48:24 The ASEAN way is non-legalistic.
48:26 We have what we known as soft laws.
48:29 So ASEAN has gained
48:31 a reputation for soft laws.
48:33 I asked CHA GPT.
48:35 What ASEAN soft law is and defined for me,
48:38 ASEAN soft law refers to
48:41 non-legally binding agreements,
48:42 principles,
48:43 and declarations
48:45 used within ASEAN to guide cooperation
48:47 and integration among its member states.
48:50 Now these instruments while not imposing strict legal obligations,
48:54 play a crucial role in shaping norms.
48:56 promoting consensus and fostering regional collaboration.
49:00 That is the definition
49:02 produced by Chad GPT on ASEAN soft law.
49:04 But I think that one of my colleagues at the National University of Singapore,
49:08 and I have to credit her with this
49:10 because she is the one who came up with all this work on ASEAN soft law.
49:14 Her name is Sien Lee Tan,
49:15 she is a colleague in the law school
49:17 at NUS
49:18 and
49:20 Uh,
49:21 I think she gave a much more better version of what ASEAN soft law is.
49:25 Uh,
49:25 she sees soft law as having an aspirational remit
49:30 and it does have a transitional
49:32 status towards hard law,
49:33 but more importantly,
49:35 she noted that there has been a change in the international legal order.
49:39 Basically,
49:40 soft law usage has become
49:42 much more widespread,
49:44 has gained credibility,
49:45 it has become an increasingly recognized area
49:49 in managing emerging issues,
49:52 climate change,
49:53 health,
49:54 uh,
49:54 global health,
49:55 as well as new and emerging technologies.
49:58 Now,
49:58 why is it important to use soft laws in this context?
50:01 It's because these things have been
50:03 Changing so fast,
50:04 that if you put in hard laws,
50:06 they are not gonna work.
50:07 You need soft laws to allow these new areas
50:10 to advance and then the soft law modifies itself
50:14 in,
50:14 in,
50:14 you know,
50:15 in treaties,
50:15 in,
50:16 in,
50:16 in agreements,
50:17 in memorandums of understanding
50:19 to advance
50:21 the ethics and setting the standards on these
50:23 soft laws on these emerging issues.
50:26 And it has also soft laws has also made it possible
50:30 to facilitate cooperation
50:32 when there is so much great power,
50:34 rivalry and geopolitical uncertainty,
50:37 uncertainties.
50:38 So this is one of the pieces that she has written,
50:40 but she is a scholar,
50:41 she has written much more scholarly pieces as well.
50:44 Now let me end with a call.
50:48 To reintegrate regionalism and multilateralism.
50:52 Let me,
50:52 let me say that
50:53 regions play a very significant role in ensuring multilateralism
50:58 and the continued provision of public goods
51:00 at a time when the work of global institutions is hindered
51:03 by great power rivalry and collective action problems.
51:06 Now this is,
51:07 I'm not saying that we should do away with global institutions,
51:09 I mean,
51:10 one now,
51:11 I will not say that,
51:12 and I think the World Bank,
51:13 IMF,
51:14 and international organizations continue to play a very important role.
51:18 But why not let regional institutions advance
51:22 when they can
51:23 and then pull everyone along when the time is right.
51:27 And I,
51:28 I think that Article 52
51:30 of the UN Charter actually recognizes
51:33 that regional organizations may be in a better position to deal
51:36 with regionspecific disruptions,
51:39 problems,
51:39 disputes.
51:41 Now,
51:41 the uncertainties
51:43 when the Cold War ended with the fall of the Soviet Union led to a reintegration
51:48 of regionalism and multilateralism and regional institutions.
51:52 The world now stands in another precipice.
51:56 The current transition will be long
51:58 and protracted and unstable,
52:00 and I was saying just now,
52:01 2020 years,
52:02 not 10,
52:03 Ma,
52:04 it's going to be messy while we transit to this order that we were like that Danny was
52:09 imagining.
52:11 Um,
52:12 now to deal with these challenges of the future,
52:14 regions are really well placed.
52:16 They are incubators of innovation
52:18 in the three areas that I talked about
52:20 and regions are again at the forefront of experiments to tackle global challenges.
52:25 It is necessary and therefore timely to divest greater resources
52:29 and authority to regions and regional institutions.
52:32 Thank you.
52:36 Thank you,
52:37 uh,
52:37 thank you,
52:38 uh,
52:38 very much.
52:39 So now we have a
52:41 very strong view on regionalism.
52:43 Let,
52:43 let's continue with the experience of Asia Pacific,
52:46 a very dynamic region that has gone through a big financial crisis,
52:49 as you know,
52:51 and reinvented itself as a fast-growing production hub.
52:53 So now,
52:54 Xinuan will present,
52:56 uh,
52:56 we talked about this paper
52:58 which was title is exactly Asia Pacific
52:59 Growth and the Changing International System.
53:02 Over to you.
53:03 Thank you.
53:04 Thank you,
53:04 thank you for having me here.
53:07 Um,
53:07 actually,
53:08 I'm aware that the term of Asia Pacific
53:12 is considered outdated in this time.
53:15 Uh,
53:16 but the,
53:16 the topic was assigned to me,
53:18 so sorry for being
53:19 old fashioned.
53:21 Um,
53:23 So actually I think Asia Pacific or
53:27 maybe more specifically East Asia
53:29 uh is very much uh uh integrated into the US led international
53:34 system,
53:34 especially international treaty
53:36 system.
53:37 Uh,
53:38 and,
53:38 uh,
53:39 actually a number of,
53:40 uh,
53:40 East Asian countries have been benefiting
53:43 from the US led international trading system
53:46 after the Second World War,
53:48 uh,
53:48 starting from Japan
53:50 and followed by,
53:51 uh,
53:51 South Korea,
53:52 uh,
53:53 Chinese Hong Kong,
53:54 Taiwan,
53:55 and also,
53:57 uh,
53:57 China,
53:57 and also,
53:58 uh,
53:58 some,
53:59 uh,
53:59 South Asian countries.
54:02 So actually the,
54:03 the whole area,
54:04 the whole region.
54:05 Has,
54:06 uh,
54:06 uh,
54:06 as I said,
54:07 has been integrated into
54:09 the US led multilateral,
54:11 uh,
54:11 trading system,
54:12 uh,
54:12 very much,
54:13 um,
54:14 and under this international trading system,
54:17 all these Asian,
54:18 uh,
54:18 countries have,
54:19 uh,
54:20 uh,
54:21 taken advantage of their comparative advantage in manufacturing,
54:25 and they have been,
54:26 uh,
54:26 uh,
54:27 involved in the US led,
54:28 uh,
54:29 trade circle.
54:31 Uh,
54:31 so they have developed their,
54:33 uh,
54:34 manufacturing base,
54:35 uh,
54:35 for,
54:36 uh,
54:36 decades.
54:38 Uh,
54:38 of course,
54:38 uh,
54:39 Japan and South Korea
54:41 were the earliest,
54:43 uh,
54:44 success,
54:45 successful countries
54:47 and also some other,
54:48 uh,
54:49 small,
54:50 small economies.
54:51 But of course in the 19 uh.
54:54 Actually it was maybe earlier,
54:56 uh,
54:57 China started its opening up in 1979
55:00 when it's diplomatic relationship
55:02 with the United States was established.
55:05 So this,
55:05 I,
55:05 I think this is not a
55:08 coincidence.
55:08 It's actually uh related
55:10 uh with each other.
55:11 Of course China joined the WTO in
55:14 the year of 2001.
55:16 And uh after that,
55:18 uh,
55:19 the other uh South Asian countries,
55:22 especially Vietnam,
55:23 also joined
55:24 the WTO in 2007,
55:27 becoming the latest group
55:29 to join the
55:31 multilateral trading system.
55:33 So you can see,
55:34 I mean,
55:35 all these uh
55:36 uh East Asian economies
55:39 have been very actively,
55:40 uh,
55:41 participating in the
55:42 multilateral trading system
55:44 or the US led international trading system,
55:47 and they have,
55:47 uh,
55:48 successfully developed their
55:50 manufacturing industries
55:52 and of course,
55:52 uh,
55:53 the US market is their major export
55:56 destination,
55:57 uh,
55:58 so you can see from
56:00 Uh,
56:00 1950s,
56:02 1960s,
56:03 almost all of them,
56:05 uh,
56:05 have witnessed a rapid growth of exports,
56:08 um.
56:10 Of course,
56:11 uh,
56:12 uh,
56:12 they have a little bit different patterns,
56:14 but,
56:15 uh,
56:15 basically,
56:16 uh,
56:16 in the early years,
56:18 uh,
56:18 they have a very rapid rising,
56:21 uh,
56:21 trade GDP ratio,
56:23 uh,
56:24 for almost all these,
56:25 uh,
56:25 economies,
56:27 and,
56:27 uh,
56:28 uh,
56:28 as I said,
56:29 the US actually,
56:30 uh,
56:30 has been their largest
56:32 export destination.
56:34 So they have been,
56:34 as I said,
56:35 benefiting
56:36 from the US led
56:38 system.
56:39 But in terms of international financial system,
56:42 maybe it is more
56:44 complicated.
56:45 Actually,
56:45 uh as you know,
56:46 uh,
56:47 in the year of 1997,
56:50 and many of them
56:53 have suffered from the financial crisis,
56:56 um.
56:58 And,
56:58 uh,
56:59 uh,
57:00 many of them,
57:00 uh,
57:01 actually,
57:01 uh,
57:02 uh,
57:03 were suffering from the
57:05 kind of binding relationship
57:07 between their currencies
57:08 with the US dollar.
57:10 Uh,
57:11 uh,
57:12 actually many of them was uh were in uh.
57:16 Trade uh
57:17 uh
57:19 Declining trade,
57:20 uh,
57:20 surplus
57:21 and uh worsening,
57:23 uh,
57:23 current counterbalance.
57:25 So,
57:25 uh,
57:26 this actually exposed their vulnerability
57:29 to the international financial system.
57:32 Uh,
57:32 so they also have,
57:33 uh,
57:34 kind of overdependence
57:36 on short term foreign
57:37 debt
57:38 nominated the US dollar,
57:40 um,
57:40 so.
57:41 Uh,
57:42 actually,
57:42 uh,
57:43 they,
57:43 as I said,
57:43 they benefited from a lot from the trading system,
57:46 but they suffered a lot
57:48 from the financial system
57:50 and also,
57:51 uh.
57:53 So maybe over concentration of their uh exports
57:57 on the US market
57:58 also reduced their
57:59 resilience in trade performance.
58:02 Uh,
58:02 so in turn,
58:04 uh,
58:04 they tried to stimulate
58:06 uh
58:07 try to uh
58:09 reach more uh
58:10 uh regional integration,
58:13 um,
58:13 so actually,
58:14 um.
58:15 Uh,
58:16 after,
58:16 of course,
58:17 uh,
58:17 after the ANSEAN was established,
58:19 but in,
58:20 uh,
58:20 uh,
58:20 2002,
58:22 uh,
58:22 when,
58:23 uh,
58:23 China,
58:23 after China joined the WTO,
58:25 China also,
58:26 uh,
58:26 started to establish a
58:28 closer regional,
58:29 uh,
58:30 integration with,
58:31 uh,
58:31 its,
58:31 uh,
58:32 East Asian neighbors.
58:33 Um,
58:34 the China ASEAN FTA was started,
58:38 uh,
58:38 in the year of 2002.
58:40 So this is also um uh China's contribution to stabilize
58:45 uh the East Asian economy and also
58:49 uh the relationship between
58:51 China and
58:52 its neighbors.
58:54 Uh,
58:55 so you can see in the financial crisis,
58:58 there was a faster depreciation
59:01 of
59:02 many Asian Asian currencies
59:04 against the US dollar.
59:07 Um
59:09 But uh of course uh we all know that uh uh right now the US has very different uh trader
59:16 attitude toward
59:17 the multilateral trading system,
59:19 but it's actually not new.
59:21 Uh,
59:22 even in 1970s,
59:25 as I said,
59:25 Japan was a
59:27 At that time was the biggest
59:29 beneficiary of
59:31 the GATT system,
59:33 but in 1970s and 1980s,
59:35 uh,
59:36 facing Japan's uh significant challenge,
59:39 the US already
59:41 domin adopted a bilateral oppressive
59:44 policy against Japan
59:46 which actually obviously,
59:47 uh,
59:48 violated the GATT rules.
59:50 Uh,
59:50 so at that time the US was already uh breaking.
59:54 The rules-based system,
59:56 um.
59:58 But uh after winning the Cold War in early 1990s,
1:00:02 uh,
1:00:03 the US fully
1:00:04 resumed and strengthened its actually support
1:00:07 to the multilateral treaty system
1:00:09 by establishing the WTO with a
1:00:12 powerful and independent
1:00:14 judicial mechanism,
1:00:15 the so-called the dispute
1:00:17 settlement mechanism,
1:00:19 uh,
1:00:19 and also the US gave up
1:00:21 its unilateralism
1:00:22 in 1980s.
1:00:24 So return
1:00:26 back,
1:00:26 return to the multilateralism.
1:00:29 Uh,
1:00:30 right now,
1:00:30 of course,
1:00:30 we are seeing uh the US
1:00:33 is adopting
1:00:34 the unilateralism again,
1:00:37 uh,
1:00:37 but of course we don't know
1:00:39 after 10 years or maybe 20 years
1:00:42 whether the US will
1:00:43 become a regular,
1:00:44 uh,
1:00:45 member of the multilateralism.
1:00:48 And also,
1:00:49 uh,
1:00:50 at the same time,
1:00:51 the US promoted the regional initiatives
1:00:53 such as APEC
1:00:55 in 1993 and NAFTA in 1994.
1:01:00 So,
1:01:00 uh,
1:01:01 across the Asia Pacific
1:01:02 region,
1:01:03 uh,
1:01:03 actually there was a closer relationship among all these,
1:01:06 uh,
1:01:07 uh,
1:01:08 members,
1:01:09 uh,
1:01:10 and,
1:01:10 uh,
1:01:11 actually at that time the US and both the US and China,
1:01:15 uh.
1:01:16 Uh,
1:01:17 advocated regional economic integration.
1:01:22 But um,
1:01:24 Uh,
1:01:25 I,
1:01:25 I would say,
1:01:26 uh,
1:01:27 the turning point,
1:01:29 uh,
1:01:29 was
1:01:30 2008
1:01:32 when the global financial crisis
1:01:34 happened,
1:01:35 uh,
1:01:36 starting from,
1:01:36 uh,
1:01:37 starting in the United States,
1:01:39 and for the WTO for the multilateral trading system,
1:01:42 also a bad event happened in 2008.
1:01:46 Actually that was there was a.
1:01:49 Big mini ministerial uh in Geneva,
1:01:52 uh,
1:01:53 it almost took like 8 or 99 days
1:01:57 but finally failed
1:01:58 to reach an agreement.
1:02:00 So that actually was the last hope
1:02:02 for the so-called Doha Round or Doha development agenda.
1:02:06 Then after that,
1:02:07 uh,
1:02:08 actually the,
1:02:09 the,
1:02:09 the at that time the Obama administration
1:02:12 basically,
1:02:13 uh,
1:02:13 gave up
1:02:14 on the WTO on the multilateral,
1:02:16 uh,
1:02:16 trade negotiations,
1:02:17 and,
1:02:18 uh,
1:02:19 uh,
1:02:19 turned to,
1:02:20 uh,
1:02:20 uh,
1:02:21 the so-called mega regionals
1:02:22 like TPP and the
1:02:24 TTIP.
1:02:25 And also under the Obama's administration,
1:02:29 the US started to question
1:02:31 ah the um
1:02:33 Uh,
1:02:34 the fairness or the,
1:02:36 uh,
1:02:36 the,
1:02:37 the,
1:02:37 the feasibility
1:02:38 of the WTO dispute settlement mechanism,
1:02:41 uh,
1:02:42 by blocking,
1:02:43 uh,
1:02:44 some members reappointment of appellate body.
1:02:49 So actually,
1:02:50 as I said,
1:02:51 starting from 2008,
1:02:53 the US has changed,
1:02:55 has started to change its attitude
1:02:58 toward the multilateral trading system.
1:03:02 So it's actually not a new,
1:03:04 um,
1:03:05 and it's largely uh
1:03:08 uh reflecting uh the
1:03:10 declining
1:03:11 position of the US
1:03:12 in world trade
1:03:14 uh
1:03:15 shown there by it's it's growing
1:03:17 trade deficit.
1:03:19 Right now,
1:03:20 of course,
1:03:20 uh,
1:03:21 especially after,
1:03:22 after,
1:03:22 uh,
1:03:23 2017,
1:03:24 uh,
1:03:25 I would say this is kind of uh
1:03:27 Revolution,
1:03:28 um.
1:03:30 Uh,
1:03:31 which was launched by President Trump,
1:03:34 um.
1:03:35 And uh starting from uh Trump administration,
1:03:39 even Trump
1:03:40 1.0,
1:03:41 uh,
1:03:42 the US position on global trade policy or global
1:03:45 governance
1:03:46 has changed dramatically.
1:03:49 So basically,
1:03:50 uh,
1:03:50 President Trump believed that
1:03:52 US leadership in global affairs is not worthwhile,
1:03:56 and giving others
1:03:58 an opportunity to take advantage of the US
1:04:01 and no matter they are friends or foes
1:04:03 and uh especially the international,
1:04:05 uh,
1:04:06 trade system with the purpose of
1:04:08 freer trade
1:04:09 is especially harmful to the US and beneficial to the others.
1:04:13 Basically,
1:04:14 um,
1:04:14 it is actually because,
1:04:15 uh,
1:04:16 uh,
1:04:16 the US has been.
1:04:19 Losing its competitive comparative advantage
1:04:22 in manufacturing
1:04:24 industries
1:04:25 one by one,
1:04:27 so,
1:04:28 um,
1:04:29 then actually this has brought some,
1:04:31 uh,
1:04:32 uh,
1:04:32 kind of a threat to the US
1:04:34 military,
1:04:35 uh,
1:04:35 hegemony,
1:04:37 um.
1:04:38 So,
1:04:39 uh,
1:04:39 then this,
1:04:40 uh,
1:04:40 Trump administration intends to
1:04:43 kind of,
1:04:43 uh,
1:04:44 return to the 19th century
1:04:46 when the US was dominate adopting a high tariff,
1:04:49 uh,
1:04:49 isolationist or trade protectionist policy,
1:04:53 and,
1:04:53 uh,
1:04:54 at the same time achieving successful industrial development.
1:04:57 Of course that was
1:04:59 also interesting,
1:05:00 uh,
1:05:00 history.
1:05:01 Right now,
1:05:02 uh,
1:05:03 the,
1:05:03 the US government is trying to build up a new deals based.
1:05:08 Bilateral trading system to replace the rules-based
1:05:12 regional and
1:05:14 both regional and multilateral system
1:05:16 which
1:05:17 was sponsor sponsored by the US administration
1:05:21 in the last
1:05:22 eight decades.
1:05:24 So actually,
1:05:25 uh,
1:05:26 uh,
1:05:26 right now the US government is not only
1:05:29 uh
1:05:30 uh
1:05:31 against
1:05:32 multilateral trading system but also uh
1:05:35 regional uh system.
1:05:37 So like uh USMCA
1:05:39 is basically uh given up,
1:05:41 uh,
1:05:41 is basically abandoned.
1:05:44 Uh,
1:05:45 so,
1:05:45 interestingly,
1:05:46 of course,
1:05:46 uh,
1:05:47 just recently,
1:05:48 uh,
1:05:49 the US government has announced,
1:05:51 uh,
1:05:52 it will,
1:05:52 uh,
1:05:52 impose reciprocal tariffs on
1:05:55 selected,
1:05:56 uh,
1:05:56 trading partners,
1:05:58 uh,
1:05:59 and you can see,
1:05:59 basically,
1:06:00 uh,
1:06:00 many
1:06:01 Asian East Asian countries
1:06:03 have higher,
1:06:04 uh,
1:06:04 tariffs.
1:06:05 Uh,
1:06:08 With the exclusion of Brazil,
1:06:10 Brazil is an exceptional,
1:06:12 but like Laos,
1:06:13 Myanmar,
1:06:14 Thailand,
1:06:14 Cambodia,
1:06:15 Bangladesh,
1:06:16 um.
1:06:18 Uh,
1:06:19 anyway,
1:06:19 Sri Lanka,
1:06:20 uh,
1:06:21 all these countries in Asia Pacific
1:06:24 area,
1:06:25 they will face,
1:06:26 uh,
1:06:26 even higher,
1:06:28 uh,
1:06:28 tariffs
1:06:29 because they have closer
1:06:31 trade relations
1:06:32 with China,
1:06:33 basically.
1:06:36 Um,
1:06:37 and also along with this,
1:06:39 uh,
1:06:39 uh,
1:06:39 uh,
1:06:40 changing US trade policy
1:06:43 right now actually,
1:06:44 uh,
1:06:45 in Asian,
1:06:46 uh,
1:06:46 regional integration,
1:06:47 uh,
1:06:48 China has become even more,
1:06:49 uh,
1:06:50 important.
1:06:51 Uh,
1:06:51 it's not,
1:06:52 well,
1:06:52 of course it's not only
1:06:54 because of policy changes,
1:06:55 but it's also because of economic,
1:06:57 uh,
1:06:58 principles.
1:06:59 Uh,
1:07:00 for China,
1:07:00 it has,
1:07:01 uh,
1:07:01 strong,
1:07:02 uh,
1:07:02 motivation to strengthen its
1:07:04 economic relationship with its neighbors,
1:07:06 um.
1:07:08 Uh,
1:07:08 also,
1:07:09 uh,
1:07:09 political relationship.
1:07:11 And uh
1:07:12 China also has been very active
1:07:14 and constructive in Asian economic integration arrangements
1:07:18 including RCEP and FTAs
1:07:20 with ASEAN,
1:07:21 AIIB,
1:07:22 and the Qingmai initiative,
1:07:23 both
1:07:24 trade and economic,
1:07:25 uh,
1:07:25 financial,
1:07:26 uh,
1:07:27 arrangements,
1:07:28 and especially China as a manufacturing powerhouse.
1:07:32 OK,
1:07:32 sorry,
1:07:33 I try to finish.
1:07:35 Has a high demand for resources,
1:07:37 materials,
1:07:37 and intermediate goods
1:07:39 which its Asian neighbors are richer,
1:07:42 um,
1:07:43 so we are trying to develop this relationship.
1:07:46 Right now,
1:07:47 of course,
1:07:47 there are some concerns
1:07:49 about China's industrial policy and
1:07:51 trade practice,
1:07:53 but basically,
1:07:54 uh,
1:07:54 especially in comparison to the US,
1:07:56 China's trade policy is more stable and predictable.
1:08:01 Uh,
1:08:02 so,
1:08:02 uh,
1:08:03 you can see from the,
1:08:04 uh,
1:08:04 global value chains,
1:08:06 uh,
1:08:06 China has now has a larger
1:08:08 role in this network.
1:08:11 A
1:08:14 OK,
1:08:15 maybe I should
1:08:17 jump to my
1:08:18 conclusions.
1:08:19 OK,
1:08:19 sorry,
1:08:20 yeah,
1:08:21 yes,
1:08:21 yeah,
1:08:22 um.
1:08:24 Maybe at one point,
1:08:26 uh,
1:08:26 right now,
1:08:26 of course,
1:08:27 uh,
1:08:28 uh,
1:08:28 China has become the largest manufacturing country in the world.
1:08:32 Uh,
1:08:33 my point is that,
1:08:34 uh,
1:08:36 I think China is very lucky.
1:08:39 Uh,
1:08:40 to happen to have all these factors necessary
1:08:43 for the development of manufacturing industry right now,
1:08:47 uh,
1:08:48 but actually,
1:08:49 uh,
1:08:50 good times don't last long.
1:08:51 Actually we are losing,
1:08:54 uh,
1:08:54 some of our advantages
1:08:56 in manufacturing,
1:08:57 uh,
1:08:57 gradually,
1:08:58 uh,
1:08:59 look at the,
1:09:00 uh,
1:09:00 the,
1:09:01 the changing population of China
1:09:03 and the declining share of young people,
1:09:06 uh,
1:09:07 so.
1:09:08 Right now actually China has started to
1:09:11 move
1:09:12 its supply chains overseas.
1:09:15 Um,
1:09:15 so,
1:09:15 but I mean in the last,
1:09:17 especially in the last two decades,
1:09:20 China really
1:09:21 had all these
1:09:23 necessary factors for developing,
1:09:25 uh,
1:09:25 manufacturing.
1:09:26 So of course right now
1:09:27 the share of China in in world
1:09:30 manufacturing output is really
1:09:32 huge.
1:09:34 Uh,
1:09:35 so,
1:09:35 uh,
1:09:35 in conclusion,
1:09:36 uh,
1:09:36 I have some points
1:09:38 to share with you.
1:09:40 Uh,
1:09:40 first,
1:09:41 uh,
1:09:41 as I said,
1:09:42 Asia Pacific benefits a lot from US led globalization
1:09:45 and appreciates
1:09:47 US leadership and the,
1:09:48 and the contribution.
1:09:50 But uh the,
1:09:51 the reverse of the US policy towards the international uh
1:09:54 system or trading system
1:09:56 is harmful and regretful for
1:09:59 East Asian countries.
1:10:00 We are really,
1:10:01 uh,
1:10:02 including China but also other East Asian countries
1:10:04 are concerned about US
1:10:06 policy change.
1:10:08 But uh in terms of trade and investment,
1:10:10 a regional economic integration in Asia Pacific
1:10:13 has great potential to mitigate.
1:10:15 Uh,
1:10:16 the damages caused by US isolation,
1:10:19 as Danny
1:10:21 argued,
1:10:22 uh,
1:10:23 actually,
1:10:23 especially the RCEP
1:10:25 region
1:10:26 has very,
1:10:26 uh,
1:10:27 great potential to
1:10:28 kind of,
1:10:29 uh,
1:10:29 develop.
1:10:32 Kind of
1:10:33 regional internal circulation,
1:10:36 ah,
1:10:36 so we have all,
1:10:38 uh,
1:10:39 at least most of them are necessary factors to develop
1:10:43 our economies.
1:10:45 For China,
1:10:46 uh,
1:10:46 I,
1:10:46 I think China has yet
1:10:48 to replace US leadership in the
1:10:51 international system.
1:10:52 Uh,
1:10:53 we still have a limited power and appeal,
1:10:56 uh,
1:10:57 in terms of the kind of world leadership,
1:11:01 not yet for China.
1:11:02 So still
1:11:04 we,
1:11:04 ah,
1:11:05 pay,
1:11:05 uh,
1:11:05 we very much appreciate the centrality
1:11:08 of ASEAN in the regional
1:11:10 integration.
1:11:11 Uh,
1:11:12 so we always,
1:11:13 uh,
1:11:13 say that,
1:11:14 uh,
1:11:14 especially ASEA is
1:11:16 kind of,
1:11:17 uh,
1:11:18 uh,
1:11:18 led by ASEAN rather than China.
1:11:21 Uh,
1:11:21 but of course China is a,
1:11:23 uh,
1:11:24 major,
1:11:24 uh,
1:11:24 advocate
1:11:25 for regional integration in Asia Pacific.
1:11:29 Thank you.
1:11:29 I'm sorry for taking.
1:11:31 Thank you.
1:11:33 Thank you very much,
1:11:34 Xing Juan.
1:11:35 Uh,
1:11:35 thank you all.
1:11:36 Very,
1:11:36 very interesting,
1:11:37 uh,
1:11:38 very interesting discussion with different views,
1:11:40 but very much,
1:11:41 uh,
1:11:41 connected.
1:11:42 So let me take the opportunity,
1:11:43 I will gonna use the next 1015 minutes to ask
1:11:46 further questions to our guests and then I will open uh for Q&A from,
1:11:50 from,
1:11:51 from the audience.
1:11:52 Uh,
1:11:53 I want to start again from,
1:11:54 from Danny.
1:11:55 Um,
1:11:56 Danny,
1:11:56 you are the author of a recent paper.
1:12:00 That argues that because of great power rivalry,
1:12:02 the world is increasingly heading toward what you call epic fail outcomes,
1:12:08 specifically a situation where everyone
1:12:10 ends up uh worse off.
1:12:13 So here we are here at the World Bank.
1:12:15 The World Bank works with a lot of developing countries.
1:12:17 So the question is,
1:12:18 what is in your view,
1:12:20 what can,
1:12:20 how can developing countries advance their own prosperity
1:12:24 under this condition?
1:12:25 Can they play a
1:12:26 kind of stronger,
1:12:27 larger role
1:12:28 in rebuilding international cooperation?
1:12:34 Thank you Matteo for that,
1:12:35 for that question.
1:12:37 Uh,
1:12:37 implicit in the idea
1:12:39 that a number of us up here are trying to advance
1:12:43 is that
1:12:45 desirable
1:12:47 that the uh
1:12:49 extent
1:12:51 rules-based multilateral globalized order has been.
1:12:55 If it's no longer available to us because
1:12:59 of great power rivalry or other ways in which nations
1:13:03 are showing
1:13:04 a deviation
1:13:06 away
1:13:07 from
1:13:09 the situation where we all supported that system.
1:13:12 And all of us benefited from it.
1:13:16 How can smaller nations,
1:13:19 how can developing economies,
1:13:21 how can those nations that are not themselves great powers,
1:13:26 Continue
1:13:27 to take action that will help support the system.
1:13:31 If
1:13:32 we take the view
1:13:33 that the current
1:13:35 international economic order
1:13:38 was built by the United States.
1:13:41 And holds together because of the United States.
1:13:45 And the United States decides to either withdraw
1:13:48 or adjust that position
1:13:51 away from a system that all of us
1:13:54 appreciate
1:13:54 benefits us,
1:13:56 how do we respond?
1:13:59 The way in which I and others have tried to argue about this.
1:14:04 is that we need to break away from the idea
1:14:08 that it is only
1:14:10 great powers that can build international systems.
1:14:15 One way in which my colleague Selena describes this
1:14:18 is that we can think about smaller scale
1:14:21 international economic systems,
1:14:23 region-based ones,
1:14:26 where the role of a great power
1:14:28 is then altered
1:14:29 to some identification of nations within that system.
1:14:33 I want to suggest another way which is the,
1:14:36 the
1:14:37 trying to steer.
1:14:40 The actions of great powers away from an epic fail outcome.
1:14:46 An outcome where everyone is worse off.
1:14:49 And I do that by just giving an example.
1:14:54 One of the ways in which we are familiar
1:14:57 with outcomes where everyone is worse off
1:15:00 is something that in game theory,
1:15:02 we think of as a prisoner's dilemma situation.
1:15:06 Where each player
1:15:08 by acting in their own self-interest,
1:15:10 inflicts.
1:15:12 An externality on the other player
1:15:15 and all of us then lead
1:15:17 to mutually destructive actions.
1:15:22 How do
1:15:23 countries that are small
1:15:26 help change the minds of great powers that
1:15:29 are bent on taking such mutually destructive action?
1:15:34 Let me show you that principle by looking at an example.
1:15:40 Take the EV industry.
1:15:43 The global electric vehicles industry and
1:15:46 associated with that electric batteries.
1:15:51 In addition
1:15:53 to the great danger of the fraying multilateral system,
1:15:57 is the fact that
1:15:59 the only way in which we have figured out
1:16:01 how to generate economic prosperity
1:16:04 for the last 250 years.
1:16:07 is also
1:16:09 a way
1:16:10 that's burning our planet
1:16:11 to a crisp.
1:16:13 We use hydrocarbons.
1:16:16 The solution to that
1:16:18 is to pivot
1:16:20 towards cleaner,
1:16:20 greener sources of energy.
1:16:23 The best hope that we've got right now.
1:16:26 Is EVs and related technologies,
1:16:30 but EVs and related technologies are caught.
1:16:33 In the throes of great power rivalry.
1:16:36 Because America
1:16:38 and other parts of the world
1:16:40 have decided
1:16:41 that this technology
1:16:43 is a dual technology
1:16:45 and it can be easily weaponized.
1:16:48 So we're caught in a system
1:16:50 where America has decided
1:16:52 its response
1:16:54 to China's EV industry
1:16:56 is to tariff
1:16:57 and sanction.
1:16:59 And by doing that,
1:17:01 it reduces the supply of EVs in the world,
1:17:05 both from China
1:17:06 and until it builds its own capacity from itself.
1:17:11 The supply of EVs to the world and to the global South has fallen,
1:17:17 worsening the situation for the global environment.
1:17:20 This is an epic fail,
1:17:21 this is mutually destructive.
1:17:24 Suppose developing nations articulated a demand
1:17:28 that then
1:17:29 said to America,
1:17:32 Yes,
1:17:32 China has broken WTO rules by subsidizing its EV industry.
1:17:37 Instead of sanctioning them,
1:17:39 why don't you subsidize your own EV industry?
1:17:43 Because yes,
1:17:44 you're breaking the rules,
1:17:45 but you're responding to someone else who's broken the rules.
1:17:49 When you do that,
1:17:51 when you subsidize your own industry and allow the
1:17:54 other rival to also subsidize their own industry,
1:17:57 you are also expressing
1:17:59 anger and disappointment at them.
1:18:02 But the end result of both of you taking these actions
1:18:06 is actually an increased supply of EVs
1:18:08 and associated technologies in the world.
1:18:11 Which ends up benefiting the global south
1:18:15 and everyone else in the world who is looking for prosperity through clean energy.
1:18:20 So by being able to pivot
1:18:22 or twist
1:18:23 policies
1:18:25 of the great powers,
1:18:26 we can nudge them away from epic fail outcomes
1:18:30 towards instead
1:18:31 win-win outcomes that are at the same time consistent with great power rivalry.
1:18:37 This is an example of inadvertent cooperation,
1:18:41 where the two great powers have ended up providing greater supply of EVs.
1:18:46 For
1:18:47 the wrong reason
1:18:49 and it's by manipulating examples like this,
1:18:52 Matteo,
1:18:53 that we can build
1:18:55 a situa a succession of case studies
1:18:58 and successes
1:19:00 where we can pivot the world away
1:19:02 from these epic failed outcomes.
1:19:05 Thank you.
1:19:06 Thank you very much.
1:19:07 Uh,
1:19:07 very,
1:19:08 very interesting.
1:19:09 Uh,
1:19:10 let me go to Mazoud,
1:19:11 uh,
1:19:11 um,
1:19:13 Uh,
1:19:14 in your presentation,
1:19:15 but also subsequent discussion,
1:19:16 clearly you are all pointing to a different system in which regionalism is,
1:19:21 uh,
1:19:22 is sort of a solution to the current situation.
1:19:25 But
1:19:25 let me try to
1:19:27 push you again back to the multilateralism.
1:19:30 What,
1:19:31 what is the value proposition of multilateralism in the current context,
1:19:34 and
1:19:35 can we see,
1:19:36 uh,
1:19:37 regionalism not as an alternative but as a complement.
1:19:41 to multilateralism.
1:19:45 Thank you very much,
1:19:46 uh.
1:19:48 just keep speaking
1:19:50 Keep speaking.
1:19:51 Thank you very much.
1:19:56 Say that.
1:19:58 But I think
1:19:59 maybe you
1:20:02 it's
1:20:03 good.
1:20:04 It's good to know.
1:20:04 Thank you.
1:20:08 So I,
1:20:08 I think that
1:20:10 the key is
1:20:12 to
1:20:13 make multilateralism.
1:20:16 At the global level.
1:20:20 A way of
1:20:22 networking.
1:20:24 The various attempts for cooperation across groups of countries
1:20:29 that are less than global.
1:20:32 So it could be regional,
1:20:33 but I,
1:20:34 I think the regional example was a very nice one.
1:20:38 But if you looked at that regional
1:20:40 example that you put up,
1:20:43 It was an East Asia regional example of the UK
1:20:48 as a member.
1:20:50 So I think this as
1:20:52 a good illustration.
1:20:57 I think
1:21:00 It
1:21:01 It's,
1:21:01 obviously,
1:21:02 yes.
1:21:05 I think it's a good example of how we have to be flexible and open,
1:21:11 so I would think of it as open groupings
1:21:13 is one important principle
1:21:16 so that countries can be members of more than one group in that.
1:21:21 And then the global networks,
1:21:24 their value-added brings from trying to bring
1:21:28 common learnings,
1:21:29 networking these together.
1:21:31 So for example,
1:21:32 the IMF
1:21:34 across the street.
1:21:35 has a relationship.
1:21:39 Of sorts with various regional reserve pooling arrangements.
1:21:46 But
1:21:47 My mind going forward that could become a much stronger relationship
1:21:52 so you could actually see the regional reserve pooling arrangements
1:21:56 as being much more integrally linked into
1:22:00 a global financial safety net
1:22:02 where the IMF comes in
1:22:04 as a supplement to
1:22:06 the regional pooling arrangement.
1:22:09 Now I use the word regional,
1:22:11 but
1:22:12 it could actually be any subgrouping.
1:22:14 There are some regions of the world.
1:22:16 That lend themselves more easily
1:22:19 to the geographic regional configuration for cooperation.
1:22:23 There are other parts of the world where
1:22:26 the geographic neighborhood is not necessarily the right grouping,
1:22:30 but there may be groupings that run across,
1:22:33 so.
1:22:35 Let's call it regional for the moment,
1:22:36 but
1:22:37 I would see those as building blocks of the multilateral,
1:22:41 uh,
1:22:41 relationships.
1:22:43 Same thing applies for the World Bank.
1:22:45 If you think about it,
1:22:46 you've got regional banks now.
1:22:49 In
1:22:50 everywhere,
1:22:51 um,
1:22:52 if you look at the portfolio of the World Bank in Latin America,
1:22:56 the portfolio of the IDB
1:22:59 or the portfolio of the World Bank in East Asia and the ADB.
1:23:04 There's quite a lot of overlap.
1:23:07 And a good question to ask is 10 years from now,
1:23:11 do we want the World Bank to be
1:23:14 identical in terms of or more or less identical in terms of
1:23:18 what the regional banks are doing in that region,
1:23:21 or
1:23:22 Does it become more of a
1:23:24 a network
1:23:26 bringing together
1:23:27 not just the regional banks,
1:23:29 but a lot of sub-regional and a lot of national
1:23:32 public development banks.
1:23:33 Um,
1:23:34 I think the last thing I would say on this which is a bit linked to your point is that
1:23:38 up to now when we think of groupings,
1:23:42 we think primarily of countries,
1:23:44 sovereign states.
1:23:45 So our basic design for collaboration is around sovereign states.
1:23:50 But increasingly,
1:23:51 and I think you said this,
1:23:53 increasingly
1:23:54 non-state actors.
1:23:57 are also becoming big players in terms of international cooperation.
1:24:02 In the we mentioned this morning,
1:24:03 quite rightly,
1:24:04 the enormous role played by United States corporations globally.
1:24:11 I think uh
1:24:13 philanthropies,
1:24:14 Gates Foundation has uh
1:24:18 An annual spend that is roughly
1:24:20 that is a good middle sized
1:24:22 uh
1:24:24 donor country spend that is likely to go up.
1:24:29 Gavi is a place where for example we have tried to bring in
1:24:33 Some of the
1:24:35 philanthropies into the structure,
1:24:37 but we are very resistant to the notion
1:24:40 of having non-state actors.
1:24:44 Play a role in the governance of multilateral organizations of any kind,
1:24:50 maybe regional or subregional or whatever the form of subgroupings will be,
1:24:56 will be a place we will innovate
1:24:59 and try to see if we can bring in
1:25:01 non-state actors into the
1:25:05 The the network because
1:25:08 the advances in development and cooperation
1:25:11 increasingly
1:25:13 will not just come from state to state interaction.
1:25:17 They will come from the interaction between states and
1:25:21 private sectors,
1:25:21 states and society,
1:25:23 states and philanthropies,
1:25:25 and so we have to find a better way of
1:25:28 opening ourselves
1:25:29 to them
1:25:31 much more so than we have been willing to do so far.
1:25:36 Thank you,
1:25:37 thank you,
1:25:37 Masood.
1:25:37 So let me,
1:25:38 uh,
1:25:39 continue with Selena and uh let me try
1:25:42 again to
1:25:43 push you from regionalism to multilateralism again,
1:25:47 but in your,
1:25:47 in,
1:25:48 from,
1:25:48 from you,
1:25:49 I mean,
1:25:49 given South Asia experience,
1:25:51 now,
1:25:52 now the point is
1:25:53 Is there any lesson from,
1:25:55 from the region that you know very,
1:25:56 very well from other regions,
1:25:58 uh,
1:25:59 in the sense that,
1:26:00 uh,
1:26:00 one obvious thing would be,
1:26:02 OK,
1:26:02 but the regions are different,
1:26:03 so there are very strong specificities,
1:26:05 but at the same time we can find common factor
1:26:08 or,
1:26:08 uh,
1:26:09 uh,
1:26:09 kind of necessary conditions that are needed
1:26:12 to do in other regions,
1:26:13 uh,
1:26:14 to realize in other reasons what happened in the South Asia.
1:26:22 Um,
1:26:23 regionalism should not be seen as an
1:26:27 alternative to multilateralism.
1:26:29 Regionalism is
1:26:31 one of the strongest supporters of multilateralism.
1:26:35 Regions uphold rules-based order a lot better than
1:26:40 Um,
1:26:41 great powers.
1:26:42 I mean,
1:26:43 we are advocates of these things,
1:26:45 right,
1:26:45 of human rights,
1:26:46 of human security,
1:26:48 because these are the things that affect
1:26:51 The ground where we lived in and we see day to day,
1:26:56 you know,
1:26:56 we experience it day to day.
1:26:57 So regionalism should not be seen as trying to supplant multilateralism.
1:27:02 Regionalism is multilateralism at the regional level
1:27:06 and they are building blocks,
1:27:07 exactly that,
1:27:08 building blocks of the multilateral system,
1:27:10 of the global,
1:27:11 of global institutions.
1:27:13 So
1:27:13 I would
1:27:14 say no,
1:27:15 don't think of it as an enemy or an
1:27:18 alternative,
1:27:19 but rather as a building block
1:27:21 and it does complement,
1:27:23 it does support
1:27:24 global institutions,
1:27:25 global governance.
1:27:27 Now,
1:27:27 turning to your question,
1:27:28 Matteo,
1:27:29 um,
1:27:30 I think that yes,
1:27:31 regions have very specific characteristics,
1:27:34 but it does not mean that
1:27:36 there are no
1:27:38 lessons that we can learn by diffusion.
1:27:41 States learn by diffusion.
1:27:42 We learned this
1:27:44 in political science in IR
1:27:46 that
1:27:46 states learn from each other,
1:27:48 OK,
1:27:49 and regions do learn from each other
1:27:51 and I think that in,
1:27:52 especially in the area of things like soft laws that I was talking about,
1:27:56 ASEAN soft laws,
1:27:57 I think this is one area where I think that if you are in a region where
1:28:02 making
1:28:03 laws,
1:28:04 uh,
1:28:04 formality,
1:28:06 legality,
1:28:08 Um,
1:28:09 and,
1:28:09 uh,
1:28:10 uh,
1:28:12 Uh
1:28:14 That kind of hard laws and rules are difficult to establish
1:28:17 because of differences like the way that Southeast Asia is,
1:28:20 is very diverse.
1:28:22 It is not like Europe,
1:28:23 Europe can go legalistic,
1:28:25 can go hard laws,
1:28:26 primarily because there is,
1:28:28 they,
1:28:28 they have
1:28:30 similarities,
1:28:30 not that all of them are similar,
1:28:32 just,
1:28:32 this is about relativity,
1:28:34 right?
1:28:34 But there are certain principles that can be agreed
1:28:38 across the entire region.
1:28:40 But in Southeast Asia,
1:28:41 it's extremely diverse.
1:28:42 Historically,
1:28:43 culturally,
1:28:44 linguistically,
1:28:45 racially,
1:28:47 extremely diverse
1:28:48 and so having to deal with coming,
1:28:50 you know,
1:28:51 having established,
1:28:52 to establish hard laws,
1:28:54 uh,
1:28:54 hard kind of,
1:28:55 um,
1:28:56 consensus.
1:28:57 It's hard,
1:28:58 it's hard.
1:28:58 You have to go informal,
1:29:00 you have to go soft laws,
1:29:02 you have to go consensus building
1:29:04 and I think this is a lesson that other regions can take,
1:29:07 especially if you are in a conflict area
1:29:09 where there is great diversity and disagreements,
1:29:11 I think that's a lesson that other regions can learn from.
1:29:14 Now the other thing that I want to point out is that
1:29:17 one of the things that I said in my presentation
1:29:19 was that there is a need for cross-regional integration.
1:29:22 So regions should not just learn from each other,
1:29:25 they need to integrate across.
1:29:27 And actually,
1:29:28 as Massuro was saying,
1:29:29 that's why I love what you are saying because exactly,
1:29:32 you,
1:29:32 you spend a lot of time in Southeast Asia,
1:29:33 do you?
1:29:35 Because that's how we think,
1:29:36 um.
1:29:38 The idea that um we are open
1:29:41 and inclusive,
1:29:43 that is a fundamental principle of Southeast Asia
1:29:46 and East Asia in general,
1:29:47 openness,
1:29:48 inclusivity.
1:29:50 So we are willing to reach out to,
1:29:52 you know,
1:29:52 players that are countries that are far across the other end of the earth.
1:29:56 Singapore has
1:29:58 trade relations with Chile on the other side of the earth
1:30:01 for food purposes,
1:30:02 for instance.
1:30:03 But
1:30:04 we are promoters of cross-regional integration.
1:30:06 Let me explain why.
1:30:08 We work very closely with Latin American countries.
1:30:11 Uh,
1:30:11 ASEAN has a ministerial meeting for,
1:30:13 with the Pacific Alliance,
1:30:15 which is made up of a select group of Latin American countries.
1:30:19 Uh,
1:30:19 we recently at the ASEAN summit,
1:30:22 uh,
1:30:22 that's held in Kuala Lumpur,
1:30:24 Prime Minister Awar Ibrahim,
1:30:26 um,
1:30:27 mooted this brilliant idea
1:30:29 of a China-ASEAN GCC Gulf Cooperation.
1:30:33 Uh,
1:30:34 Gov countries cooperation,
1:30:35 um,
1:30:36 and,
1:30:37 uh,
1:30:37 summit.
1:30:38 So this is cutting across,
1:30:40 building on the existing linkages that we have
1:30:43 and building blocks to bigger things,
1:30:47 cross-regional integrations.
1:30:49 And I think this is something that we can all do
1:30:51 as,
1:30:52 you know,
1:30:52 as building blocks,
1:30:53 as bottom-up strategies at a time when,
1:30:56 you know,
1:30:57 when other things cannot move.
1:30:59 Right,
1:31:00 so we are not saying that we supplant global institutions.
1:31:03 We are not saying that neither are we
1:31:04 saying the regional institutions are stopgap measures,
1:31:07 but that they are complementary,
1:31:09 they are building blocks
1:31:11 of regional,
1:31:12 uh,
1:31:12 of global governance and global institutions.
1:31:17 Thank you,
1:31:18 thank you very much.
1:31:19 Uh,
1:31:20 let's now go to
1:31:21 Xinuan.
1:31:22 Having you here with your experience at the WTO being one of the,
1:31:26 uh,
1:31:27 multilateral institution that probably now is,
1:31:29 uh,
1:31:29 suffering,
1:31:30 uh,
1:31:30 the most,
1:31:31 uh,
1:31:32 so what is your view?
1:31:33 What does the,
1:31:34 uh,
1:31:35 WTO need to do to,
1:31:36 uh,
1:31:37 you know,
1:31:37 to reform itself,
1:31:38 to adapt to the new situation?
1:31:40 OK,
1:31:41 thank you.
1:31:41 Uh yes,
1:31:42 WTO is in a very difficult time and uh
1:31:45 WTOE is actually short of budget right now because the US denied to
1:31:50 refuse to uh
1:31:52 pay their money to the WTO.
1:31:54 So,
1:31:55 uh,
1:31:55 but,
1:31:55 uh,
1:31:56 just echoing uh what uh Masoud and Selena said,
1:31:59 actually in the WTO there is also a concept of,
1:32:02 uh,
1:32:02 open pluralism.
1:32:04 It's very similar to open
1:32:06 grouping,
1:32:07 as you said.
1:32:08 Um,
1:32:09 so I,
1:32:10 I think for the WTO right now,
1:32:11 that maybe the biggest issue is also the,
1:32:14 uh,
1:32:14 decision-making mechanism.
1:32:16 Uh,
1:32:18 right now,
1:32:18 uh,
1:32:19 the WTO has to make any,
1:32:21 every,
1:32:21 uh,
1:32:22 decision,
1:32:23 uh,
1:32:23 on the basis of consensus.
1:32:26 Um,
1:32:27 so it's right now,
1:32:27 it's very,
1:32:28 very difficult to reach
1:32:30 consensus among so diversified,
1:32:32 uh,
1:32:33 members.
1:32:34 Uh,
1:32:35 especially in the,
1:32:35 in the,
1:32:36 uh,
1:32:37 against the background of,
1:32:38 uh,
1:32:38 geopolitical rivalry.
1:32:40 Um,
1:32:41 but actually,
1:32:41 uh,
1:32:42 in the multilateral,
1:32:44 uh,
1:32:44 trading system,
1:32:45 uh,
1:32:46 this kind of plurilateral approach is not new at all.
1:32:49 Uh,
1:32:50 even in the get,
1:32:51 uh,
1:32:52 period,
1:32:52 all those,
1:32:53 uh,
1:32:53 uh,
1:32:54 rounds of negotiations
1:32:56 actually were implemented prolaterally,
1:32:59 uh,
1:32:59 which means that only,
1:33:00 uh,
1:33:01 a part of,
1:33:02 uh,
1:33:03 members joined the negotiations.
1:33:06 Uh,
1:33:06 a lot of,
1:33:07 uh,
1:33:07 uh,
1:33:08 especially developing,
1:33:09 uh,
1:33:09 countries
1:33:10 were not involved in the negotiations,
1:33:13 uh,
1:33:13 about tariff reductions.
1:33:15 So it's not new at all.
1:33:17 Uh,
1:33:17 so,
1:33:18 so,
1:33:19 uh,
1:33:19 I mean,
1:33:20 when we talk about the success of the GATT,
1:33:23 especially the Euroground,
1:33:25 uh,
1:33:25 it,
1:33:26 it actually,
1:33:27 the Euroground is actually an exceptional,
1:33:29 uh,
1:33:30 practice.
1:33:31 Uh,
1:33:32 when all members reach a single undertaking.
1:33:36 Uh,
1:33:36 package.
1:33:37 It's,
1:33:37 uh,
1:33:38 it,
1:33:38 it was,
1:33:39 as I said,
1:33:39 it was exceptional even for the,
1:33:41 for the GATT.
1:33:42 So,
1:33:42 um,
1:33:44 practically it is more,
1:33:46 uh,
1:33:46 feasible,
1:33:47 uh,
1:33:47 to,
1:33:50 uh,
1:33:50 reach a consensus or reach agreements among
1:33:53 selected members,
1:33:54 not all members.
1:33:56 Right now it's,
1:33:57 it's,
1:33:58 as I said,
1:33:58 it's it's impossible.
1:34:00 And the euro go round was successful because of a number of uh.
1:34:04 Reasons at that time,
1:34:06 at that period.
1:34:07 Um,
1:34:08 so this is,
1:34:09 I think,
1:34:09 uh,
1:34:10 uh,
1:34:10 the WTO should be doing.
1:34:12 And then basically,
1:34:13 members have,
1:34:14 uh,
1:34:15 uh,
1:34:16 reached a kind of agreement on this point.
1:34:20 But the problem right now is,
1:34:21 uh,
1:34:22 Uh,
1:34:22 the US is blocking everything,
1:34:24 uh,
1:34:25 with the consensus
1:34:27 decision-making mechanisms,
1:34:27 that's a bigger trouble.
1:34:29 Uh,
1:34:30 and also sometimes India,
1:34:32 uh,
1:34:32 does this to the WTO.
1:34:34 Um,
1:34:35 another thing I,
1:34:36 I think,
1:34:37 uh,
1:34:37 uh,
1:34:38 as,
1:34:38 as Selena said,
1:34:39 uh,
1:34:40 uh,
1:34:40 ASEAN has a kind of soft law approach.
1:34:43 But for the WTO
1:34:45 it's always been a kind of hard law,
1:34:47 uh,
1:34:47 approach.
1:34:48 So,
1:34:50 uh,
1:34:50 the dispute settlement mechanism is still,
1:34:52 uh,
1:34:53 critical,
1:34:54 uh,
1:34:54 because if,
1:34:55 uh,
1:34:56 um,
1:34:57 there's no such mechanism,
1:34:59 uh,
1:34:59 members don't respect their obligations and commitments.
1:35:03 Since the WTO is worthless.
1:35:05 Um,
1:35:06 so,
1:35:07 right now,
1:35:08 of course,
1:35:08 uh,
1:35:08 some members have established a so-called NPIA to replace
1:35:13 the,
1:35:14 the,
1:35:15 the current,
1:35:15 uh,
1:35:16 dispute mechanism.
1:35:17 Uh,
1:35:18 uh,
1:35:18 so,
1:35:20 uh,
1:35:20 one way at least for,
1:35:22 for
1:35:24 Members other than the US.
1:35:26 Ah,
1:35:26 used to join MPIA more actively.
1:35:29 Um,
1:35:30 so if,
1:35:31 ah,
1:35:31 if,
1:35:31 ah,
1:35:31 ah,
1:35:32 the membership of MPIA could be expanded
1:35:36 to cover more and more WTO members,
1:35:39 then members will
1:35:41 Belief in the in the binding uh uh
1:35:45 uh
1:35:47 bindingness of WTO rules.
1:35:49 Uh,
1:35:50 so,
1:35:51 uh,
1:35:52 I mean for the WTO I these two things are very important.
1:35:55 Yeah,
1:35:55 thank you.
1:35:57 Thank you.
1:35:58 Thank you all very much.
1:35:59 Uh,
1:36:00 I was just told by the organizers that unfortunately
1:36:02 we don't have time for the Q&A session.
1:36:04 Uh,
1:36:05 we need to close because
1:36:06 it's lunchtime,
1:36:07 but I'm sure that you can approach the speakers during lunchtime and ask,
1:36:11 uh,
1:36:11 uh,
1:36:11 ask questions.
1:36:12 Just to conclude,
1:36:13 let me,
1:36:14 uh,
1:36:14 really thank you again.
1:36:15 You,
1:36:16 uh,
1:36:16 really played as an orchestra here and it was fantastic because
1:36:20 actually we started,
1:36:21 you all started with the recognition that,
1:36:23 uh,
1:36:23 we have a problem and so the,
1:36:25 the,
1:36:25 the,
1:36:25 the multilateralism that we
1:36:27 Or knowing we all like is not there anymore,
1:36:30 but at the same time you could offer us
1:36:33 solution.
1:36:35 Obviously you use many different perspectives,
1:36:37 but maybe the regionalism is the key word that
1:36:40 we can use here in our concluding remarks.
1:36:42 But you
1:36:43 were very good in arguing that regionalism can be
1:36:46 kind of prodromic to a new
1:36:49 multilateralism.
1:36:50 And you provided many,
1:36:52 many examples,
1:36:54 many examples there,
1:36:55 and obviously,
1:36:56 as Selina said,
1:36:57 also regionalism and then
1:36:59 cross region and then you get
1:37:01 to multiralism,
1:37:02 multilateralism
1:37:04 again and
1:37:06 and I know that Intermit concluded the previous section talking about Europe.
1:37:09 I'm lucky that you don't have the mic so I can say something here,
1:37:12 but Europe is another example of a regional,
1:37:16 a regional agreement.
1:37:17 Now what we expect from Europe is not only
1:37:20 Uh,
1:37:20 improving,
1:37:21 uh,
1:37:22 itself,
1:37:22 but also to be another bridge toward other,
1:37:25 other regions,
1:37:26 and I'm thinking about Africa mostly because it's very close,
1:37:29 but it,
1:37:29 it applies to
1:37:30 many other regions.
1:37:31 So,
1:37:32 uh,
1:37:32 thank you all again.
1:37:33 Thank you for your participation.
1:37:35 Thanks for your contribution,
1:37:36 very interesting discussion,
1:37:37 and I look forward to next.
1:37:43 Thank you very much
- add-style
- lp-body-content
A video recording of the Session 1 on Day 1 of The Annual Bank Conference on Development Economics 2025 "Development in the Age of Populism." This session discusses "Reviving Multilateralism".
KEYNOTE ADDRESS: Danny Quah, Li Ka Shing Professor in Economics, Lee Kuan Yew School of Public Policy, National University of Singapore
CHAIR: Matteo Bugamelli, Executive Director, World Bank
PANELISTS:
Paper 1: Multilateralism: Whenever We Can or Only When We Must? (Masood Ahmed, Center for Global Development)
Paper 2: Regionalism and Multilateralism: Southeast Asia (Selina Ho, Lee Kuan Yew School of Public Policy, National University of Singapore)
Paper 3: Asia-Pacific Growth and the Changing International System (Xinquan Tu, China Institute for WTO Studies, University of International Business and Economics)