World Order 2.0

By Miloš Milivojević

The liberal international order created after World War II is going through inevitable changes. However that doesn’t mean liberal order itself will disappear. Neither it means necessary developments will alter core principles on which liberal order is based on. Simply those changes of the system must reflect on contemporary distribution of power in order to ensure better function of it by making the system more inclusive. Speaking of that, first thing that comes to our mind is China and role it has in contemporary order, benefits it had from the system and eventual incentives to try to modify or replace liberal order. Finally if China decided to launch initiative to create a new international order, the question would be does China has what it requires.

We have been witnessing tremendous development of China. Vast amount of that development should be credited to the globalization processes, which are taking place within the liberal order. After opening itself to the outside world in the 1980s, China’s share in global economy grew from to 2% to the 17.8% today while leaving behind U.S. who currently sits on 15.5%. Bringing up vast amount of people from poverty throughout the years one could argue that China is a primary and the biggest beneficiary of existing order and liberal capitalism. Besides, after financial crisis broke out in 2008. China had given substantive help to stop its spreading as well overcoming it, knowing its in their interest to ensure that global trade and economy function properly. Unlike Mao’s China that saw international order as destructive and took isolationistic approach while offering revolutionary model to replace it, Xi’s China has ambitions to lead existing one. That point has been made at the 2017. World Economic Forum in Davos where Chinese president reflected on new American government focusing more on itself and domestic problems, EU having to deal with its internal problems and Brexit while underlining ambition to fulfill eventual vacuum in global leadership.

However there are some problems with this kind of arguments. One could argue that China is undermining and delegitimizing liberal order by going around existing institutions, like IMF, and establishing new ones, such is Asian Infrastructure Investment Bank (AIIB). We must not overlook a fact that many institutions of liberal order doesn’t fairly represent world as it is today. Development of others and relative decline of Western countries have put this subject on agenda. China has been asking regularly for a revision of distribution of voting shares in IMF, which is dominated by U.S., who has greatest share of votes. When that motions were ignored in 2015. China decided to pursue another path launching AIIB and tip the balance in its favor. Still launching AIIB isn’t just in spite of USA because there is real need for investments in infrastructure around the Asia estimated at trillions of dollars. So the real challenge here lies in how to incorporate this initiative into system because it has ability to bring progress where existing institution can’t or lack resources to do so.

Nevertheless, does China have potential to create and be a leader of international system at the moment? I don’t hold that opinion. First, it lacks soft power to attract others who will trust China enough and therefore legitimize their leadership. Numerous strains with neighbors have resulted in reputation where Chinese intentions aren’t always welcomed with approval. Second, China’s military power and capability to project power around the globe are still very far from necessary level for eventually being leading authority of the system. Even if China had those requirements its questionable would it pursue construction of new order because that kind of initiative is highly expensive. Right now China benefits much more than it contributes to the system.

On the other, challenge to the liberal order and demand for transformation is coming from citizens around the world. This is understandable due to number of reasons. After financial crisis we have been witnessing the case where the poor are getting even poorer while top 1% of rich people is increasing their wealth. GINI index is growing. Globalization affected enormous amount of people leaving them without job and unprepared to face the world as it is today. By survey from Pew Research Centre, 57% of Americans wants the U.S. to deal with own problems first and let others deal with theirs. Therefore it is not such far from truth that ruling elites are living in some kind of “liberal bubble”. However, if liberal order is to survive those concerns and effects must not be ignored in order to rollback growing demand for mercantilism, isolationism and authoritarianism.

Instead of considering is the international liberal order over or not, we should focus more on how we could make fundamental improvements so it could bring more benefits to all, be more inclusive and fair, trying to reach consensus as wide as possible. If that has been assured, desires and requests for different order would’ve been prevented.

Miloš Milivojević, 24, is a young professional in international affairs from Belgrade, Serbia, with a bachelor's degree in International Relations from the Faculty of Political Science, University of Belgrade. He also has a strong interest in global governance and economic development.