We live in a troubled world that is facing the challenges imposed by the global economic recovery, the acceleration of the technological revolution, the energy transition associated with climate change and the power struggle between West and East.
The sources of tension are permanent. However, there are some positive signs.
World inflation begins to decline after applying the traditional recipe of raising interest rates by central banks. After peaking in June, US inflation has fallen for four consecutive months. Inflation in the euro area slows for the first time in 17 months. In both cases, inflationary expectations are revised downwards. The disease is not cured, but there has been a response to the applied medicine. Which is no small thing.
Liberal democracy stood firm against populism in several countries throughout the year. In France, Emmanuel Macron defeated Marine Le Pen to be re-elected president. In the UK, the year started with Boris Johnson as Prime Minister and ended with Rishi Sunak, with a much more conciliatory view. In the United States, voters punished candidates with the Donald Triumph stamp in the midterm congressional elections. In Brazil, Jair Bolsonaro lost the election to a moderate coalition. In Chile, the people said no to the radical changes proposed by the Constituent Assembly.
The election results were in line with the changes in voter preferences that began to be seen last year. According to a study by the University of Cambridge, support for populist views, parties and politicians has declined with the pandemic, as indicated by opinion polls including more than half a million people in 109 countries. The overall rating of populist leaders fell by more than 10 percentage points between mid-2020 and the end of 2021.
The team of researchers responsible for the report concluded that the analysis of all these data shows clear signs of a brake on the “populist wave”. Populist leaders’ mishandling of the pandemic, coupled with a desire for stability and a rejection of confrontation, has stirred public opinion. The threats posed by the health crisis have translated into a heightened appreciation of professionalism in public policy management and increased trust in the state.
The pro-globalization boost that India can give to the G-20, the group of the most powerful countries on the planet which represent 80% of world GDP, is also expected with positive expectations. India just assumed the presidency in Bali, Indonesia, and its term will run until next year’s summit.
The G-20 presidency is seen as an opportunity to start reformulating the global cooperation agenda. “The world is one family”, reads the motto that India has chosen for the occasion, which shows the intention to reinvigorate the multilateral institutions. Since his independence, he has been a strong advocate of multilateralism, actively participating in forums on sensitive global issues such as humanitarian intervention, nuclear disarmament, improving world trade rules and solutions to climate change.
Historically, India has raised concerns on behalf of the “global south” in multilateral forums and is expected to use its presidency to do the same at the G-20 high table. More leadership is expected in addressing issues on the global agenda such as environmental protection, food safety, medical care and the challenges of technological automation. In this sense, New Delhi supports a reformed multilateralism so that international organizations are more accountable and inclusive. It is understood that the crisis of multilateralism responds to the lack of broader representation of developing countries and emerging economies in multilateral institutions.
Prime Minister Narendra Modi will try to seize the opportunity to show strength in his intention to transform India from an emerging economy to a new global power. India is already the fifth largest economy in the world, having just overtaken the United Kingdom, its former colonizer. It will grow nearly 7% this year, a growth rate second only to Saudi Arabia among G-20 members.
There are also some signs in our region that our region is viewed with some optimism in global discussion forums, despite the lingering noise throughout the year. It is welcomed that Lula governs together with the party of Fernando H. Cardoso in Brazil; that Boric consult Ricardo Lagos in Chile; that Petro has José A. Ocampo as Finance Minister in Colombia; and that Raúl Alfonsín has become fashionable in Argentina.
The Region must reduce the political risk, the main risk that it imposes on companies and people today. The challenges of today’s world determine the need for an extremely delicate management of the actions and signals given by governments. It’s impossible not to make a mistake, but it’s crucial not to dwell on the mistake. For this it is necessary to find the space of centrality in which the political forces agree on the fundamental points and discuss the nuances. The media and political parties are key institutions in guiding people through the process so that simple answers to complex problems, something so characteristic of populism, are rejected.
In the global chaos we are experiencing worrying news related to the war in Ukraine, the delicate situation in China associated with the zero covid policy or the attack on democratic institutions in Mexico. But, at the same time, if you look closely, in that same global chaos you can find signs to be optimistic.
