Policy Space for Developmental States in a Multipolar World: In Search of Social Reproduction and Economic Redistribution

1
Policy Space for Developmental States in a
Multipolar World In Search of Social
Reproduction and Economic Redistribution

• Marina Durano, DAWN
• WIDE Annual Conference 2009
• Basel, Switzerland

2
World Growth Rate
3
Outline

• Double standards and power inequalities
• Politics of aid and limits of multilaterally-coord
  inated action
• Re-ordering towards a multi-polar world
• Expansion of policy space as implicit demand for
  sovereignty

4
Double Standards

• Fiscal Stimulus versus Fiscal Discipline
• Trade protectionism versus trade liberalization
• Liquidity expansion versus lack of access to
  financing or new debt obligations

5
On Fiscal Space

• Developed countries had the fiscal space to opt
  for a fiscal stimulus package when recession hit
• Developing countries are typically advised by
  Bretton Woods institutions to maintain
  conservative fiscal deficit targets, particularly
  during an economic crisis

6
On trade policy

• 78 Measures since the G20 Meeting in Washington,
  DC
• increase in tariffs (Russia, Ecuador)
• non-tariff measures (Argentina, Indonesia, India,
  China)
• Green policies, e.g. US subsidies to battery
  production in US-based factories

7
On liquidity

• G20 Leaders agreed to 250 billion SDR allocation
  but split according to equity shares
• In 1997, there was already an agreement for an
  SDR allocation but never fulfilled
• Additional resources to WB and IMF for
  re-lending-- raising the possibility of new debt
  obligations
• Searching for new sources of liquidity

8
Limits of multilateralism

• The politics of aid has set limits on
  multilaterally-coordinated action.
• WB-IMF-WTO are preferred by donors as centers of
  macroeconomic policy discussions and
  decision-making--division of labor
• The UN is seen as lacking capacity in this
  subject area.

9
A multi-polar world

• Large middle-income countries are creating new
  centers of power
• Brazil, China, India, South Africa, Russia(?)
• As new donors, leading trade negotiations,
  providing alternative currencies for
  international payments

10
Intl Reserves Bn 2009 Growth GDP Tn Public Debt/GDP External Debt/GDP
USA 70.57 -1.6 14.58 74.90 93.42
Canada 41.08 -1.2 1.34 62.30 56.74
UK 57.30 -2.8 2.28 47.20 458.53
Ger 136.20 -2.5 2.86 62.60 156.79
France 115.70 -1.9 2.10 64.40 209.63
Italy 104.00 -2.1 1.80 103.70 58.86
Japan 954.10 -2.6 4.49 170.40 32.25
G-7 1478.95
China 2033.88 6.7 7.80 15.70 5.38
Brazil 197.40 1.8 2.03 40.70 11.63
Russia 435.40 -0.7 2.23 6.80 23.69
India 274.20 5.1 3.32 59.00 4.91
Taiwan 280.90 0.89 0.76 28.20 13.08
S. Korea 231.20 0.7 1.31 27.20 19.05
Sing 170.10 -2.5 0.24 92.60 10.25
3622.20
11
Reproduction and Redistribution

• Political demands expressed as increased spending
  on issues that matter to feminists
• Alignments with heterodox/alternative policy
  proposals
• Expansion of policy space and fiscal space serves
  as the vehicle for feminist demands

12
On sovereignty

• Increased policy space is an implicit demand to
  secure sovereignty
• A reaction to the emasculation of state power
  through its marketization or conflict
• Nation-state remains the key political target
  strengthening the state and regulating the market

13
Gender-equitable Public Policy

• Policy measures that create behavioural
  incentives so that there is a re-balancing of
  responsibilities for provisioning among social
  institutions (e.g. care diamond).
• Protect and promote in the global
  politico-economic order