The 77-member group, which now spans 134 countries, recently met in Havana and wants a new global redistribution of wealth. A redistribution that would be less unfair for them. In fact, the Group of 77 is once again reciting the old refrain of the “new international economic order.”
The leaders of the group expressed the old theses from the 1960s about unequal exchange. These theories have some merit. They argue that developing countries are systematically disadvantaged in international trade.
In essence, this disadvantage would largely be due to the difference between wages in rich countries and those in poor countries. Wages in poor countries would not allow workers in those regions to easily purchase goods made in rich countries.
The poor became richer
However, since then, various previously very poor countries such as Singapore, South Korea, Japan and certain regions of China have managed to become richer and even pay higher salaries than in the USA or Europe.
Why have some countries become richer while others stagnated or even became poorer? Part of the answer lies in the competence and corruption of these countries’ elites. Another part of the answer lies in the resources available to countries and the nature of the systems in place.
It is easier for liberal democracies to fight incompetence and corruption than for authoritarian regimes with communist tendencies.
Blame the United States
But the real reasons for the imbalances in the distribution of wealth between countries do not matter. The incompetent and corrupt elites of many countries still prefer to blame the evil Western capitalists rather than themselves.
Chinese leaders fully understand this blame dynamic.
They have therefore taken the lead in the Movement of 77 and promise the world to the countries that will follow them.
Yes, but the new international order is already here. In this new order, China is the richest country. In purchasing power parity terms, it is worth $26 trillion, while the United States is second with a GNP of $21 trillion.
China is also the largest trading partner of most countries. She is the first patent producer.
Isn’t it strange that China has risen to the top spot in an economic system designed to put poor countries at such a disadvantage?
The Havana Summit is in reality a vast farce aimed at isolating the United States and its allies in international institutions.
If unequal trade continues around the world, China has become the main source.
