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Global Econopolitics

Coronavirus crisis demands post G-Zero governance

  Executive Research Director


It is surprising to see how far Trump administration’s blunt response to the COVID-19 crisis has come. The president announced his intention to suspend funding the World Health Organization, which he had criticized for being too close to China. Even if it is true that WHO has some problems, now is not the time to hurt its function and disappoint those who work devotedly.

“Global orders have a tendency to change gradually at first and then all at once.” In March, when the new corona crisis spread rapidly in the world, an intellectual in the United States made this comment.

World without leaders

How will this crisis change the way the world looks? Among the various debates, the most probable one would be the scenario of deepening the chaotic international order of a ” G-Zero world “, which Ian Bremmer, who is well-known in the world’s political risk analysis, has been suggesting. The world is witnessing the risk of a lack of leadership prolonging difficult time, with neither the US nor China can be reliable enough.

With a crisis like this, countries might not afford to think about others. But it must be a different story when it comes to the United States, which has regarded itself as a leader in the international community for years. If you do not play the role you should play, the hammer of history will fall. Such a warning message is included in the opening comment.

British lessons from the 1950s

It was issued in an article by Kurt Campbell, former U.S. Assistant Secretary of State during the Obama administration, and Rush Doshi of the Brookings Institution (Note 1). The two point to the Suez crisis of the 1950s as a lesson. The UK repelled Egypt, which nationalized the Suez Canal, and made military interventions with France and Israel, but failed to gain the support of the international community including the United States and suffered a painful failure. They see this as a clear indication of Britain’s decline as a global power.

If the United States reacts badly to the current COVID-19 crisis, that may reduce the influence of the country and eventually lead it to slip out of its leadership position in the world. Yet the US is failing the test, lamenting Mr. Campbell and Mr. Doshi.

Ad hoc reaction

President Trump’s America-first and ad hoc, myopic responses are further accentuated by the corona crisis. From the beginning, the president revealed lack of sense of crisis. As the infection spread out in the United States, he called the virus as “China virus” in an apparent attempt to give an impression that China owes a lot of responsibility to this crisis. It is hard to see him exerting strong leadership in an international framework such as G7 or G20. And then the suspension of funding to WHO comes in the middle of corona crisis.

American professors Henry Farrell (George Washington University) and Abraham Newman (Georgetown University) think that the United States is not playing a role of leader in terms of global response to the corona crisis. It argues that it has handed over some of its role to China (Note 2).

Failing the test

But it does not seem like China is scoring points instead. The country is trying to create a positive image of reliable major power with the “Mask diplomacy” which provides masks and medical teams to other countries. However, China’s initial response to the virus was too slow and it became the source of the spread of the virus in the world. This is not perceived just as a technical mistake but it gives an impression that there exists systematic problem in the country.

Neither the United States or China has been a winner. US professor Joseph Nye points out that both US and Chinese leaders failed the first round because they wasted crucial time early in the infection and missed opportunities for international cooperation (Note 3). In responding to global crises such as infectious diseases, all countries can benefit by cooperating each other. He argues that US and China should change their attitudes toward cooperation instead of competing like a zero-sum game.

Strengthen existing tides

A French intellectual Jacques Attali also pointed out that China’s lack of transparency is a source of wariness from the world (Note 4).

Professor Dani Rodrik of Harvard University insists another risk. The corona crisis does not change the shape of the world, but highlight and strengthen existing tides, according to him.

“Neoliberalism will continue its slow death. Populist autocrats will become even more authoritarian. Hyper-globalization will remain on the defensive as nation-states reclaim policy space. China and the US will continue on their collision course”, he wrote (Note 5). At a time of crisis, will nations and individuals behave more straightforwardly, and the changes that are occurring are likely to accelerate?

Europe showing weakness

Europe, which became the center of infection next to China, has also exposed its weaknesses. Although the European Union always emphasizes solidarity, initial response to Italy’s explosive infection was slow. EU countries have been discussing to put together a plan for economic measures, but they can’t resolve confrontation on an idea of mutualization of debt (so called corona bond or Euro), which Italy strongly demanded.

This reflects the EU’s long-standing North-South problem regarding economic support. Jointly issuing bonds as the euro zone to raise funds will help countries with economic difficulties. However, the European countries in the north, such as Germany and the Netherlands, don’t give the go-ahead, insisting that it is not appropriate for everyone in the euro zone to bear debts.

Joint Bonds conflict

The idea of issuing joint bonds was also discussed during the euro crisis in the first half of the 2010s, which started in Greece. Although the euro zone unified the currencies and centralized monetary policy, each country is doing its financial management, not letting it go. So the idea of joint bonds emerged in order to prevent the euro crisis by strengthening system for financially supporting the member states.

Opponents, on the other hand, hate the burden on their own nation and are in a position that a more moderate support framework is enough.

Question of solidarity

Even in Germany, former Foreign Minister Sigmar Gabriel argues that in order to support Italy and Spain, all euro zone countries need to share the necessary loans (Note 6).

Without the joint bonds, whether the EU can show solidarity with the southern European countries by mobilizing alternative means will affect the political situation in Europe. In Italy, populist politicians, who are trying to connect the economic crisis with the EU criticism and seek public support, are ready to hear the opportunity.

Anxiety about developing countries

With both US and Europe turning inward, growing concern is the spread of infection in developing countries. The explosive spread of infections in Africa and India, where the medical system is weak and the vast number of poor people is in sight, will make the situation worse than in developed countries. It would be too late to start supporting after that.

If those and other developing countries become the center of infection after China and developed countries, the global chain of infections may not stop. Prevention of explosive infection in developing countries is also a problem for developed countries.

Prepare for the worse

The recent news that G20 countries were moving to give debt relief to help developing countries is a positive step of international cooperation. International organizations are also planning to provide economic support to developing countries. However, if the spread of infection in developing countries becomes explosive, it will be necessary to provide support on a different scale. International society does not seem to be well functioned and prepared.

Then what should be done? Prevent deepening of the leaderless G-Zero situation and encourage the US and China to constructively cooperate in multilateral frameworks. It might look too simple and straight, but there is no shortcut.

Creating a core group in G20

The first thing to do is to utilize the existing framework of G7 and G20. The problem is that the G7 lacks China and India, and the G20 has too many countries to move swiftly and efficiently.

To supplement the shortcomings of those forum, an informal core group could be set up within the G20. Former US undersecretary of State Nicholas Burns proposes creation of the G20 “Steering group” by the leaders of five countries: The United States, China, India, Japan, and Germany (Note 7). If this would be seen to have too many Asian countries, adding a French president or an EU representative (President of European Commission) can be an option.

Even things that are difficult to do could be moved forward during the time of emergency. The current G20 summit was born following the global financial crisis of 2008.

From G-Zero to new G5?

It will be worth trying a new consultation mechanism to confront the historical crisis of the Coronavirus. It can be started with a temporally status, but if proved to be successful, it might have a chance to become a center forum in the future. That would be the birth of new G5. If those five countries work together to tackle global challenges, they should be much more effective than the current G7 and G20.

In order to overcome the crisis, efforts to get out of the zero gravity state of G-Zero are indispensable. It is necessary not only for the current fight against coronavirus, but also for the after-corona world to function properly.

(Note 1) Kurt M. Campbell and Rush Doshi, “The Coronavirus Could Reshape Global Order,” Foreign Affairs, March 18, 2020

(Note 2) Henry Farrell and Abraham Newman, “Will the Coronavirus End Globalization as we Know It?” Foreign Affairs, March 16, 2020

(Note 3) Joseph S. Nye, Jr., “China and America Are Failing the Pandemic Test,” Project Syndicate, April 2, 2020

(Note 4) “Technology to reign supreme after the coronavirus: Jacques Attali,” Nikkei Asian Review, April 9, 2020

(Note 5) Dani Rodrik, “Will COVID-19 Remake the World?”, Project Syndicate, April 6, 2020

(Note 6) Sigmar Gabriel, “The Lethal Threat of COVID-19 Isolationism,” Project Syndicate, April 1, 2020

(Note 7) Nicholas Burns, “How to Lead in a Time of Pandemic,” Foreign Affairs, March 25, 2020

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