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The developing world wants in
May/June 2007
by Nayan Chanda

Nayan Chanda is the editor of YaleGlobal Online. This essay is adapted from his forthcoming history of globalization, Bound Together: How Traders, Preachers, Adventurers, and Warriors Shaped Globalization (Yale University Press).

The growing interconnectedness of the world through trade and travel has not produced equality. In the 1990s, the pro-globalization policy pursued by Latin American countries produced anemic rates of 1 percent per capita growth. Africa, one of the continents most open to trade, has emerged as the poster child for failed globalization. Between 1981 and 2001, the proportion of Africans living below the international poverty line of a dollar a day increased from 42 to 47 percent.

Yet despite these clear economic inequalities, globalization overall has also clearly promoted economic growth. Since 1985—while the absolute number of people living in poverty has risen from 1.5 billion to 1.6 billion—the share of the world’s population living in poverty has declined.

Africa’s decline cannot be attributed exclusively to globalization. A host of historical reasons and bad governance, combined with unfortunate geography and climatic disasters and disease, has brought sub-Saharan Africa to a state of dismal poverty. Coastal African countries that could have attracted footloose investment in the 1980s missed the boat because of bad governance and lack of infrastructure. As Berkeley economist Pranab Bardhan puts it, “Globalization is not the main cause of developing countries' problems, contrary to the claim of critics of globalization—just as globalization is often not the main solution to these problems, contrary to the claim of overenthusiastic free traders.”

In fact, the poor themselves have answered the old debate on whether globalization is good or bad for the poor. Contrary to the anti-globalization activists who gather at international meetings to speak on their behalf, most of the poor would like to be part of globalization. True, many in Africa and Latin America tend to view globalization as nothing but an attempt at recolonization by the West. But the larger trend was spotted early in a global survey conducted in 2003 by the Pew Research Center for the People and the Press: globalization is viewed much more favorably in low-income countries than in rich ones.

The survey showed that most people worldwide viewed growing global trade and business ties as good for their country. The number of households in developing Asia and sub-Saharan Africa supporting the view that “globalization has a bad effect on my country” was negligible—9 to 10 percent. “People in emerging nations generally acknowledge and accept globalization,” the survey concluded. Three-quarters or more of those interviewed in almost every country thought children needed to learn English to succeed in the world today.

To the poor, globalization means opening to the world—access to the goods and services they aspire to and see on their television screens. A survey of 23,500 consumers online in 42 markets on five continents, conducted by A. C. Nielsen in 2005, offered an interesting glimpse of the newly emerging middle class in the developing world. For Indians (78 percent) globalization means better job opportunities; 73 percent of Filipinos agree, as do 71 percent of Chinese. Over half of Latin Americans (57 percent) and consumers in Asia Pacific (53 percent) believe that more global business in their markets brings greater job opportunities and better working lives.

Meanwhile, the West—having preached the virtues of free trade ever since the days of the Opium Wars—suddenly appears worried now that millions of Chinese, Indians, and Vietnamese want to join in the global trading system. Only 28 percent of people in the United States and Western Europe, according to the 2003 Pew survey, thought that increasing global trade and business ties was “very good.” Indeed, a significant minority (27 percent of households) thought that “globalization has a bad effect on my country.”

The growing concern in the West about the economic impacts of a rising China and India is seen by many in the developing world as overblown fear about countries that are still desperately poor. Of the 2.3 billion people who live in these two countries, nearly 1.5 billion earn less than two dollars a day.

These and millions of people in the developing world are aware of what they are being deprived of by being shut out of the world market, and they are aware of the chasm that separates them from the beneficiaries of globalization. The current wave of anti-globalization sentiment in the West is seen as yet another example of the powerful seeking to change the rules of the game when the score is not in their favor.

The high-speed connections that bind the world today make it impossible, even dangerous, for the winners to ignore the losers as they could in the era of sailboats and camel caravans. The standard of living people generally enjoy in the West is intimately linked to growing connections with the developing world and rising opportunities they offer their citizens to improve their lives. And the early-twentieth-century wars and recessions offer stark lessons about the consequences of forcibly disconnecting the human community. It would be a grave mistake for the rich industrial nations suddenly to try to block globalization because it is politically convenient.  

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