Does the Coronavirus Represent another Threat to Globalisation Already Under Attack?

How the Coronavirus Represents a Threat to Globalisation?

As we all know, the rapidly spreading Coronavirus has wreaked havoc on global travel, global economies, and global citizens.

Though the outbreak is in the Wuhan region of China, thanks to our interconnected and integrated world, it spread quickly and took many lives.

Indeed, notice the world global that we used three times previously and you would realise why some experts are beginning to worry whether the Coronavirus represents a threat to the very process of globalisation.

The point here is that as globalisation has made it easier for the virus to spread across the world, it is inevitable that sooner or later, we would be hearing calls from someone or the other about how globalisation is to blame for the Coronavirus outbreak.

Already, globalisation has become somewhat of a bad word in many countries worldwide where populists are storming to power promising to put their countries first and not cede power to some supranational organisation such as the WTO or World Trade Organisation that oversees and regulates the global trade.

Indeed, some of these populists are also closing their borders and limiting migration and immigration which goes against the spirit of globalisation.

Is Globalisation a Force for Good or Does it Benefit a Few at the Expense of Many?

So, how did globalisation which is essentially a force for good considering the economic theories that mention how Trade between countries is a mutually beneficial thing become so derided and criticised?

Moreover, how did globalisation that helped millions of people in the developing world to be lifted out of poverty become a target for the very people that it intended to help?

The answers to these questions lie in the way which the global elite who benefited from globalisation were perceived to have done so at the expense of the poor and the marginalised.

In other words, the gains from globalisation went to the upper layers of the income hierarchy and did not really trickle down as expected by those at the bottom.

It is often said that the poor subsided the lifestyles of the rich and the rich became richer while the poor became poorer as evidenced in the high levels of income inequality that manifested itself worldwide.

Moreover, regional and chauvinistic sentiments came to the fore in response to globalisation leading to the Anti Globalisation brigade worldwide.

The Threat Posed by the Coronavirus is Similar to the Lehmann Shock in 2008

Returning to the Coronavirus, it must be acknowledged that globalisation did contribute to the rapid spread of the virus.

Much like the Lehmann Shock of 2008 (the collapse of the American Investment bank, Lehmann Brothers) and its aftermath were blamed on globalisation, the Coronavirus too is something that has been exacerbated by globalisation.

The irony here is whereas the Lehman Shock was made in the United States, the Coronavirus is made in China (which is the prime beneficiary of globalisation).

Indeed, some experts are already cautioning that the Coronavirus represents a key trigger for a worldwide recession at a time when sluggish growth in many countries is becoming a concern to policymakers.

Moreover, with global trade links down, it is difficult at this moment to estimate the true impact of the Coronavirus.

This very limitation of how one can predict the impact of global crises is one of the main criticisms against globalisation in the sense that one does not know which part of the globe would be impacted due to some event happening anywhere.

As mentioned in the title, the Coronavirus represents a threat bigger than Brexit, Trump, and the Worldwide rise of populists to the globalisation project and hence, its supporters better start framing responses and more importantly, acting on them in time.

Why China and Global Stakeholders Must Not Wait for the Crisis to Blow Over Gradually

For starters, the proponents of globalisation can well do to enhance global cooperation and come up with coordinated responses to the Coronavirus before someone somewhere rants against globalisation and asks for global trade to cease.

Second, efforts must be made to convince China to act more responsibly as well as with transparency and accountability so that there are no doubts anywhere that there is a veil of secrecy hanging over its efforts to contain the outbreak.

In addition, the multilateral bodies such as the United Nations, World Health Organisation, and other institutions must step up their efforts to contain the outbreak in conjunction with China.

An important outcome of the Coronavirus can be to prod China to be a more open society and change its stance on human rights and the rights of its citizens.

Indeed, if not anything, this crisis can serve as the catalyst for the long pending demand for Chin to become a freer and less constrained (to its citizens) society.

Of course, all these are slightly idealistic scenarios and our feeling is that much like the effect of the Lehmann Shock wore off in due course, the present crisis would blow over and things would revert to Business as Usual.

No Business as Usual This Time at Least

This is precisely what is not needed as Business as Usual would mean that the next time a similar crisis strikes, the whole process would repeat itself.

As the Chinese themselves like to say that Crisis contains the word Opportunity in Mandarin, it is time for them to seize this moment and work with the global community to formulate a response rather than engaging in Paranoid behaviour.

To conclude, the Coronavirus is yet another threat to globalisation and the most visible of all threats due to the nonstop saturation Media Coverage and the Optics of the same.

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Authorship/Referencing - About the Author(s)

The article is Written By “Prachi Juneja” and Reviewed By Management Study Guide Content Team. MSG Content Team comprises experienced Faculty Member, Professionals and Subject Matter Experts. We are a ISO 2001:2015 Certified Education Provider. To Know more, click on About Us. The use of this material is free for learning and education purpose. Please reference authorship of content used, including link(s) to and the content page url.