The World Bank has indicated that the global economy will face in the next 5 years the lowest growth prospects in three decadesas a consequence of the higher cost of debt, and above all due to the fracture that has occurred in the globalization process, following the the worsening of the geopolitical confrontation between the United States and China.
It should be added that the United States and China, the two superpowers of the time, are absolutely integrated by the technological revolution, which has even exacerbated its integration in the last 10 years due to the intensive use on a global scale of Artificial Intelligence (AI), the main technology of the 4th industrial revolution.
For this reason, the international organization predicts that global GDP will grow by only 2.4% in 2024, down from 2.6% last year, and would be the third consecutive year in which economic growth appears weaker than in the previous 12 months.
Thus one senses that the 1920s threaten to become “…a decade of Missed opportunity” for the global system.
It is a lack that manifests itself at all levels, first of all in international trade, which would grow only half from the average of the decade before the pandemic (2020/2021).
The most affected by this situation would be the emerging and developing countries, which would expand by only 3.9% per year, 1 percentage point less than in the last decade.
The International Monetary Fund (IMF) projections for the next 5 years are fully consistent with those of the World Bank, implying that the expansion over this period would be the smallest since the globalization process began in the 1990s. .
Advanced countries are also on this downward line and would grow by only 1.2% this year, compared to 1.5% in 2023, while Germany (by extension, Europe) faces a recessive.
This is why in the next 5 years there would be an increase in poverty in the world and there would be 95 million people immersed in this growing marginality. This implies that the trend of systematic poverty reduction experienced over the last three decades would be reversed.
The International Monetary Fund also points out that there was a 19 percentage point drop in its forecasts from 2008 to 2023, and this significantly widened the gap in per capita income between advanced and emerging and developing countries, bringing it to 80 years in 2008 to 130 years in April 2023.
Decidedly, The phase of full structural convergence between the North American and Chinese economies seems to have ended, or at least suspended. which began in the 1990s and reached its peak in 2007, exactly one year before the outbreak of the international financial crisis of 2008/2009, which had its epicenter on Wall Street with the collapse of Lehman Brothers; and the amazing thing is that this fundamental phenomenon of globalization and the convergence between emerging capitalism and advanced capitalism has now been crippled by the geopolitical conflict and structural rupture that has occurred between the United States and China. Geopolitics has changed the structure, which is unusual in capitalist accumulation.
It must be agreed that the rift between the USA and China has an essentially political/strategic cause; and therefore it only has one solution – if it has one – on that plane.
It’s not a question of resources or technology; On the contrary, it fully appeared at the very moment when the fourth industrial revolution is taking place in the world, the main feature of which is the large-scale emergence of artificial intelligence.
What is underway is a practically instantaneous digitalization process that realizes in real time the deepest vocation of the integration system on a global scale and in real time.
In summary: the strategic fact to highlight is that 21st century capitalism is a system absolutely integrated by the technological revolution, and therefore intrinsically cooperative, and non-conflictual; and this is the fundamental trend, with the addition that the pace of its integration is dictated by the digitalisation of the system, hyper-increased in the last 5 years by the widespread diffusion of Artificial Intelligence and the 4th industrial revolution.
Last week Kristalina Georgieva, managing director of the International Monetary Fund, argued that the offer between the United States and China caused the world economy to decline by at least 4.5 percentage points of global GDP of the next 10 years, and this especially affects the North American superpower, in its capacity as the largest economy in the world.
The issue is political and sooner or later it will lead to a cooperation agreement between the United States and the People’s Republic, without this meaning that competition cannot be exacerbated. But cooperation must prevail.
Source: Clarin
