ATCA Briefings

The Global Spirit of Acrimony & Mistrust Must Be Changed!

Dear ATCA Colleagues

[Please note that the views presented by individual contributors are not necessarily representative of the views of ATCA, which is neutral. ATCA conducts collective Socratic dialogue on global opportunities and threats.]

The US and the EU said India and Brazil offered no serious access to manufactured goods markets in return for proposed reductions in US farm subsidies and European agricultural tariffs. Kamal Nath, the Indian trade minister, accused the rich countries of arrogance and inflexibility. He told the Financial Times: "It is not just a question of figures. It is a question of attitude. The US does not realise that the world has changed."

We are grateful to Prof Jean-Pierre Lehmann at IMD Lausanne, Switzerland, for his contribution to ATCA, "WTO -- Sustainable Global Business Requires Foundations and Trust -- The Global Spirit of Acrimony & Mistrust Must Be Changed!"

Jean-Pierre Lehmann is Professor of International Political Economy at IMD International -- Institute for Management Development -- in Lausanne, Switzerland, since January 1997. His main areas of expertise are the socio-economic and business dynamics of East Asia, the impact of globalisation on developing countries and the government -- business interface, especially in respect to the global trade and investment policy process. In 1994 he launched the Evian Group, which consists of high ranking officials, business executives, independent experts and opinion leaders from Europe, Asia and the Americas. The Evian Group's focus is on the international economic order in the global era, specifically the reciprocal impact and influence of international business and the WTO agenda. Jean-Pierre Lehmann acts in various leading capacities in several public policy institutes and organisations. He obtained his undergraduate degree from Georgetown University, Washington DC, and his doctorate from St Antony's College, Oxford University. He is the author of several books and numerous articles and papers primarily dealing with modern East Asian history and East Asia and the international political economy.

Prior to joining IMD, Jean-Pierre Lehmann has had both an academic and a business career which over the years has encompassed activities in virtually all East Asian and Western European countries, as well as North America. He was (from 1992) the founding director of the European Institute of Japanese Studies (EIJS) at the Stockholm School of Economics and Professor of East Asian Political Economy and Business. From 1986 to 1992 he established and directed the East Asian operations of InterMatrix, a London based business strategy research and consulting organisation. During that time he was operating primarily from Tokyo, with offices in Seoul, Taipei, Bangkok and Jakarta and was concurrently Affiliated Professor of International Business at the London Business School. Other previous positions include: Associate Professor of International Business at INSEAD (European Institute of Business Administration) in Fontainebleau, France; Visiting Professor at the Bologna Center (Italy) of the Johns Hopkins University School of Advanced International Studies; twice in the 70s Visiting Professor and Japan Foundation Fellow at the University of Tohoku, Sendai (Japan); and Founding Director of the Center for Japanese Studies at the University of Stirling (Scotland), where he also taught East Asian history in the University's History Department. From 1981 to 1986 he directed the EC-ASEAN 'Transfer of Technology and Socio-Economic Development Programmes' held in Singapore, Bangkok, Jakarta, Kuala-Lumpur and Manila. He writes:

Dear DK and Colleagues

Re: WTO -- Sustainable Global Business Requires Foundations and Trust -- The Global Spirit of Acrimony & Mistrust Must Be Changed!

The headline in the Financial Times from 22nd June reads: "Splits and acrimony among G4 partners dash trade deal hopes." The only problem with the title is the use of the word "partners." In today's global economic climate, there is no sense of partnership or solidarity. On 14th May an Evian Group communiqué was issued titled: "An Urgent Wake-Up Call on the Multilateral Economic Order." Just over a month later, the situation has not improved; arguably this latest Doha Round failure is proof of a state of continued deterioration.

The fact that this failure may be little noticed and may have no immediate impact is not a consolation. Today the global economy seems like a huge sky-scraper, built at furious pace, with floor constructed over floor, but with little regard to the possibly cracking foundations and no solid insurance policy. If an earthquake comes -- which is pretty certain to happen at some stage (it always has, and there are already a few tremors) -- the consequences could be quite dramatic.

The main reason the Doha Agenda is not moving forward is that there is an absolutely putrid atmosphere in the global policy making community, an absence of trust and, as the FT headline says, a great deal of acrimony. Between North and South, there is mutual suspicion that is eerily reminiscent of the early 1970s. Nor however are North-North or South-South relations characterised by trust. There is a lot of acrimony around.

In a letter also in Friday's FT "Unrestrained globalisation is bound to change", UBS Senior Economic Adviser George Magnus adds his voice to those who see worrying parallels with a century ago when the global golden age seemed to beckon and failed so very miserably.

For the global market economy to be sustainable, there must be strong institutional foundations and a spirit of minimal trust. These are the two main foci of The Evian Group at IMD: to strengthen the institutional foundations, especially the international rule of law and justice, and to build confidence between communities and stakeholders of the 21st century global economy. The two are inseparable.

Having a global economy booming with such high growth and at such high speed with increasingly weak foundations and in a spirit of acrimony is a recipe for possible disaster.

Collective vision, collective leadership and collective efforts are needed at this increasingly critical juncture. We need to act and show leadership in a manner consistent with that wonderful Chinese proverb: "It is not the cry, but the flight of the wild duck that leads the flock to fly and follow."

Kind regards

Jean-Pierre

[ENDS]