Obituary of Globalisation

Kayode Komolafe

Another obituary of globalisation was written at the World Economic Forum (WEF) held last week in Davos, Switzerland. With the theme, “A spirit of Dialogue,” the forum was a harvest of ideas which brought together powerful political and business leaders as well as experts, civil society activists and the media.

As pundits reflect on the conclusions to be drawn from the forum, it is important to pay attention to one poignant message thrown up by some of the conversations at the gathering: the end of globalisation. This obituary of globalisation was proclaimed by the US commerce secretary, Howard Lutnick.  He was a member of the huge US delegation to Davos.

Here is how the American commerce secretary put it in a panel discussion: “We are here to make a very clear point: globalisation has failed the West and the United States of America. It’s a failed policy. It is what the WEF has stood for, which is export, offshore, find the cheapest labour in the world, and the world is a better place for it… The fact is it has left America behind. It has left American workers behind.”

As a replacement for globalisation, Lutnick said his country has opted for “America First.” He urged other countries to follow in the footsteps of the US because as he added, “When America shines, the world shines.”

As a matter of fact, eight months earlier across the Atlantic, the British Chief Secretary to the Treasury Darren Jones, also made a similar proclamation of the death of globalisation. It was a response to the “Liberation Day” declared by Trump when tariffs were imposed on America’s allies and non-allies alike. Jones said: “Globalisation as we’ve known it for the last couple of decades has come to an end.” Jones was echoing the British Prime Minister Keir Starmer, who once said since Trump had “acted for his country”, he (Starmer) would also act for his own country, the United Kingdom. Starmer was talking   about the tariff war. On that occasion, Starmer said Britain “will do everything necessary to protect Britain’s national interest” using” industrial policy.” Notably, Starmer said Britain would protect its own businesses. His words: “the world as we know it has gone.”

The pointed implications of recent events for globalisation appear to be buried in the other highlighted conclusions of Davos 2026.

Among these takeaways from the gathering is the legitimate anxiety about Artificial Intelligence (AI).  The conspicuous presence of big tech in Davos speaks volumes for the centrality of AI in global economic discussions, what with the attendance of Tesla’s Elon Musk and Nvidia’s Jensen Huang.

It also emerged in Davos that there is still a strong predilection for increased oil production. The initial threat by President Donald Trump of America to take over Greenland by force also brought the defence of Europe to the fore. Trump’s message to European governments to increase their defence spending seems to be sinking. The American president also flaunted the military superiority of his country by referring to a supersonic arsenal from where equipment was drawn to kidnap Venezuelan President Nicolas Maduro. Trump asked Russia and China to go back to the drawing board in the global arms race.  

 Indeed, the global business and political elite gathered in Davos had conversations on the trends in the global economy amidst what is now commonly referred to in the media as “geo-political tension.” A trigger for the tension   is Trump’s dogged pursuit of his Make America Great Again (MAGA) agenda. The tariff war and dismantling of the pillars of multilateralism are among the instruments for executing the agenda.

They all make nonsense of globalisation.

Similarly, the British, perhaps, forget that Brexit is a step away from globalisation. If Britain is averse to the integration of the European economies, how can it be genuinely pursuing the integration of the world systems as the goal of globalisation? So, the British are only shedding crocodile tears when they say globalisation is dead.

Globalisation became a buzz word in 1990s in the wake of the Fall of Berlin Wall or what neo-liberals prefer to call “the collapse of communism.”  It was a moment triumphalism by the exuberant Right. According to the ideologues, the superiority of the capitalist mode of production had been proven beyond all reasonable doubt, as lawyers would say.

Globalisation is essentially a rebranding of global capitalism. In over 30 years here in Nigeria, for instance, there has hardly been any expert discussion of the economy without the mention of the word “globalisation.”  Common phrases that prop up in such discussions include “globalisation is unstoppable,” “we should face the reality of globalisation,” “this is the age of globalisation” etc.

In theory, the idea of globalisation is basically about the integration of systems in the world. Such systems could be social, cultural, political or economic.  But in the specific economic context in which neo-liberals use the word, the goal of globalisation is to turn the whole globe into a single market in which capital moves freely across political boundaries. In the process information, goods and services would flow freely across the world. To the enthusiasts of globalisation, the whole of society is just a market!

The inevitability of globalisation, therefore, became a gospel truth among neo-liberal experts. Yet, this claim has been questioned in theory and in practice. Brexit and Trumpism, for instance, are practical negations of globalisation.

The retreat of globalisation may continue as the crisis of global capitalism deepens. Inequality has worsened as globalisation has benefited only a minority of humanity. Yes, globalisation has generated enormous wealth.  But this wealth is concentrated within 1% to the exclusion of 99%. The global periphery was rarely integrated. The matter is made worse by the resurgence of the populist impulse even in the developed countries. So, the contradictions are on the one hand among classes within a nation and on the other hand among nations globally.  Neo-liberal experts appeared not to pay attention to these contradictions.

Before the practical manifestations of the limits of globalisation, its illusions had been demonstrated in theory by other experts too.  Take a sample. In his highly insightful 2010 book entitled “23 Things They Don’t tell You About Capitalism,” South Korean economist Ha-Joon Chang devotes a chapter on the myth of globalisation with a telling caption “Capital Has a Nationality.” His argument is as follows: “Despite the increasing “transnationalisation” of capital, most transnational companies in fact remain national companies with international operations, rather than genuinely nation-less companies…

“Thus, despite globalisation rhetoric, the nationality of a firm is still a key to deciding where its high-grade activities, such as R&D and strategising, are going to be located. Nationality is not the only determinant of firm behaviour, so we need to consider other factors, such as whether investor has a track record in the industry concerned and how strong its long-term commitment to the acquired company really is. While blind rejection of foreign capital is wrong, it would be very naïve to design economic policies on the myth that capital does not have national roots any more…”

The current obituary of globalisation may eventually turn out to be premature. Well, that’s a matter of extrapolation. What is not in doubt, however, is that globalisation has generated enormous discontents as Nobel Laureate in economics, Joseph Stigliz, has argued in some of his works. Beyond that, globalisation is currently under a grand assault. The most devasting of the blows on globalisation is coming from the direction of Trumpist America, the most advanced capitalist economy.

In sum, the relevance of the foregoing mega trends in the global economy to Nigeria is that deepening economic thoughts should be the basis of policy formulation. In addition to closely monitoring the trends in technical terms, Nigeria’s own economic history should be instructive in thinking about the solutions to economic problems. What is needed is more than periodic economic recovery programmes for the validation of International Monetary Fund (IMF) and World Bank to ease debt management. As Prime Minister Starmer of Britain says, every nation should envision a future for itself amidst the current global disruptions. Managing the political economy of Nigeria is certainly a more arduous task than running a Public Limited Company (PLC).

That is the first lesson to be learnt from the global disruptions. Again, the political economy approach is suggested for consideration by policymakers in Nigeria. As the foregoing has shown there are indeed political motives behind the economic policies of Trump and the responses from other parts of the world. That is why a good grounding in political economy matters a lot in shaping policies for any nation in this era of turbulence.