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  Félix Peña

INTERNATIONAL TRADE RELATIONS NEWSLETTER
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LATIN AMERICA AND THE CHALLENGE OF NAVIGATING A "MULTIPLEX WORLD"
Amitav Acharya helps us reflect on the region and the global scenario.

by Félix Peña
August 2017

English translation: Isabel Romero Carranza


 

In a "multiplex world" - a concept propounded by Amitav Acharya - multiple players reflecting cultural diversity and the unequal distribution of relative power compete at several simultaneous levels. These players include not only national states but also international organizations, companies, other non-governmental actors and even geographic regions with a certain degree of institutionalization, such as the EU, or those regions that aspire to be similar.

The idea of a "multiplex world" becomes more relevant in light of the changes that can be observed today in the international system and especially in the global trading system. Unlike the international system that resulted from World War II, the one that is emerging now does not reflect the point of view or the interests of a superior power, not even of a group of powers with sufficient clout to impose, in a sustained way, their will on the rest. Therefore, it is more difficult to identify who could create the new ground rules of international competition.

In a world with such characteristics, the protagonists have to be clear about their goals and what they can aspire to achieve, especially due to the relative value they have in the perspective of the other protagonists with whom they interact.

At least three factors explain the new international scenarios that have an impact on the relative value that each country has for the rest. The first is world population; the demographic growth and the age pyramid generate a population map with marked differences to those of the past. The other factor is the connectivity of nations and markets, not only physical connection but also economic and cultural. The third factor is that all the players - nations or regions, consumers or producers, companies or citizens- perceive multiple options to achieve their objectives. Understanding the dynamics of such options will be a necessary condition in order to compete and negotiate from now on.

Three consequences can be anticipated for the international strategy of Latin American countries. The first is the need to have quality diagnostics on the changes that are at work in all the regions and countries. The second is the development of capabilities for negotiating worldwide and simultaneously. The third is the need to articulate the efforts around the goals for international integration that reflect an assertive vision of what they aspire to achieve.

What role can the Latin American region play in relation to the strategy for the insertion of its different countries in a "multiplex world" and to influence the eventual redesign of the institutions and rules of global governance? This has become a very topical question.


The concept of "multiplex world" was propounded by Amitav Acharya, professor of the American University - Washington D.C., in his book "The End of American World Order", published by Polity Press in 2014. (In this regard, see the July 2014 edition of this newsletter, and the April 2015 edition on http://www.felixpena.com.ar/). Later on, Acharya developed his idea of a "multiplex world" in articles published this year and whose references can be found as recommended reading of this newsletter.

In a "multiplex world", a plurality of actors with a range of cultural diversities and unequal relative power can compete simultaneously on multiple levels and scenarios. They are, among others, national states, but they can also be international organizations, companies, and other non-governmental actors, including different types of transnational networks. Sometimes they are geographic regions with a certain degree of institutionalization, such as the European Union, or those regions who aspire to be similar.

It is a world of interaction and continuous negotiation and in which violence in its various forms is one of the modalities used in the confrontation between the players. However, none of them has sufficient power to impose, on a continuous basis and single-handedly, a certain global or regional order, with its institutions and its rules. Therefore, it is a world in which hegemonic aspirations have limited and not necessarily sustainable effects.

The idea of a "multiplex world" becomes more relevant in light of the profound changes that are at work today in the international system and especially in the global trading system. (See the June 2017 edition and July 2017 edition of this newsletter on http://www.felixpena.com.ar/). Unlike the international system that resulted from World War II, the one that is emerging now does not reflect the prospects or the interests of a single stronger power, not even those of a group of powers with sufficient clout to impose, in a sustained way, their will to the rest. Therefore, it is becoming increasingly difficult to identify who will create the new ground rules of the international competition of the future.

In a world of such characteristics, all the actors navigate according to what they believe are their own possibilities. This means having a correct diagnosis of the margins of maneuver allowed by the realities of the distribution of world power, including the knowledge of the spaces of agreement that exist between the other players. This is valid both in the global geographic space and in each of the regional or sub regional spaces. Each player needs to be clear about its goals. Above all, it needs to be clear about what can be realistically achieved, especially as a consequence of the relative value it has in the perspective of the other actors with whom it interacts. (See the May 2012 edition of this newsletter on http://www.felixpena.com.ar/, and particularly the reference to the book by Ian Bremmer, "Every Nation for Itself. Winners and Losers in a G-Zero World", Portfolio/Penguin, New York 2012).

The diagnoses that are made as well as the strategies and courses of action that any actor attempts to develop in the international system, including possible alliances, are exposed to the constant changes of the dynamic political and economic contexts.

At least three factors explain the new international scenarios that affect the relative value that each country may have for the others.

The first is world population. Not only its sheer number but also its demographic growth and age pyramids have generated a population map with marked differences to those of the past. In relative terms, countries in Asia, Africa and Latin America are becoming increasingly prominent in international relations, whether political, economic or cultural. It is a population in which the distribution of income has given rise to a phenomenon with an impact on social behavior, life expectancy, and consumption levels. We are referring to the growth of the urban middle class, with capacity for consumption and access to information about its options and, therefore, a relative empowerment, all of which are impossible to ignore in the strategies for insertion in the world of any country

The second factor is the connectedness of nations and markets. Physical connection, but also economic and cultural. The world has become more connected due to technological changes. It is a world that, being more connected, is more similar in many aspects and more differentiated in priorities and expectations. Goods and services, ideas and values, customs and patterns of consumption tend to be assimilated and, at the same time, differentiated largely due to cultural factors. Understanding them is a growing need for those trying to compete successfully in global markets.

The third factor is that all the players - nations or regions, consumers or producers, companies or citizens - perceive multiple options to achieve their objectives. Understanding the dynamics of such options will henceforth be a necessary condition for competing and negotiating.

All what was mentioned above signals the entry into a dynamic, complex and unpredictable world. Operating in such a world will require reconciling short-term visions and interests with those of the very long term. It will require identifying and evaluating all possible options and also having the ability to predict and capture, in time, the continuous shifts in the competitive advantages of nations originated in technological changes, in variations of relative power, or in cultural transformations that affect values and priorities.

Three consequences can be anticipated for the international strategy of Latin American countries, including Argentina. One is the need to have quality diagnostics on the changes happening in all regions and countries with a potential impact on the supply of their goods and services, in order to compete in their markets. It implies organizational efforts to harness the capacity available in the academia at all levels.

Another consequence is the need to develop negotiating capabilities with the whole world simultaneously, without assigning priorities. For countries with the advantages that prevail in the Latin American region, every potential trading partner is valuable. It is certainly not easy to put this into practice. It implies overcoming tendencies to prioritize this or that country for historical, cultural or, worse still, ideological reasons. Negotiating strategies that favor one country or region over another are not recommended for countries such as Argentina and many of its Latin American partners, which are quite distant from the key international power players but that, due to their natural resources, business experience, talent, creativity and cultural and ethnic diversity, have what it takes to be valued by a broad spectrum of other nations and markets. For Latin American countries and for Argentina, choosing the Atlantic over the Pacific, in the region, or Europe over the US or China, in the world, or any given country or group of countries, would not be advisable at all. This has become a dated practice.

And the third consequence would be the need to articulate social efforts around the goals for international insertion that reflect an assertive vision of what the country aims to achieve.

What role can the Latin American region play in relation to the strategy for the insertion of its different countries in a "multiplex world" and to influence the eventual redesign of the institutions and rules of global governance? This is a very topical question if we take into account the schedule of meetings in which Latin American countries will participate in the upcoming months and until the end of 2018. Among these international meetings, three are worth noting: the Eleventh WTO Ministerial Conference, to be held in Buenos Aires in December 2017; the meeting of the CELAC-China Forum, that will take place in Santiago de Chile, in January 2018, and the G20 Summit, also to be held in Buenos Aires, in November 2018.

During the Seminar on the Alliance of the Pacific and Mercosur, organized by the INTAL in Mendoza last July 19, on the occasion of the recent Mercosur Summit (see http://conexionintal.iadb.org/), the participants discussed the coordination between the countries of the region, both in relation to their insertion in the new global economic context and the renewal of the agendas of Latin American regional integration processes. An assertive vision of the opportunities and, at the same time, challenges that the new global reality poses for the countries of the region prevailed. It was pointed out that, faced with such opportunities and challenges, Latin American countries had to adapt their strategies and, in particular, their methodologies of joint work taking into account that many of the concepts, paradigms and formulas of the past are now becoming obsolete.


Recommended Reading:


  • Aaronson, Susan Ariel, "Taking Trade to the Streets. The Lost History of Public Efforts to Shape Globalization", The University of Michigan Press, Ann Arbor 2001.
  • Acharya, Amitav, "Asia can survive great-power rivalry in Asia", East Asia Forum, 4 October 2015, en http://www.eastasiaforum.org/.
  • Acharya, Amitav (ed), "Why Govern? Rethinking Demand and Progress in Global Governance", Cambridge University Press, Cambridge 2016.
  • Acharya, Amitav, "Donald Trump as President: Does It Mark a Rise of Illiberal Globalism? Threats to international liberal order and democratic nations, both external and internal, shape new forms of globalization", Yale Global Online, Yale University, January 22, 2017, en http://yaleglobal.yale.edu/.
  • Acharya, Amitav, "Coping with the changing world order", en East Asia Forum Quarterly, Vol.9 Nº 2, April-June 2017, en http://press-files.anu.edu.au/, y "Can ASEAN cope with the changing world order?", East Asia Forum, 31 July 3017, en http://www.eastasiaforum.org/.
  • Acharya, Amitav, "Global Governance in a Multiplex World", EUI Working Papers, June 2017, en https://papers.ssrn.com/.
  • Allison, Graham, "Destined for War. Can America and China Escape Thucydides's Trap", Houghton Mifflin Harcourt, Boston - New York 2017.
  • Allison-Reumann, Laura; Murray, Philomena, "Should the EU be considered a model for ASEAN?", East Asian Forum, 6 August 2017, en http://www.eastasiaforum.org/.
  • Arguello, Jorge, "Una respuesta latinoamericana para Venezuela", Editorial - Fundación Embajada Abierta, 8 de agosto 2017, en http://www.embajadaabierta.com/.
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  • Draper, Peter; Khumalo, Nkululeko; Tigere, Faith, "Sustainability Provisions in Regional Trade Agreements: Can they be Multilateralised?", IDB - ICTSD, RTA Exchange, Overview Paper, Geneva - Washington DC., July 2017, en http://e15initiative.org/.
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Félix Peña Director of the Institute of International Trade at the ICBC Foundation. Director of the Masters Degree in International Trade Relations at Tres de Febrero National University (UNTREF). Member of the Executive Committee of the Argentine Council for International Relations (CARI). Member of the Evian Group Brains Trust. More information.

http://www.felixpena.com.ar | info@felixpena.com.ar


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