Wednesday 22 September 2021 ,
Wednesday 22 September 2021 ,
Latest News
  • Bangladesh, Kuwait to chart out roadmap for boosting bilateral cooperation: FM
  • PM for forming Women Leaders' Network to pursue gender equality
  • Afghanistan’s Taliban want to address General Assembly: UN
  • PM seeks US investment in ICT, renewable energy, blue economy
26 July, 2021 11:27:40 PM / LAST MODIFIED: 26 July, 2021 11:28:34 PM
Print

Economic diplomacy for third world countries in the age of globalization

Economy is the main driving force of the twenty-first century. Powerful countries boost their economic capability to survive in this current world order. Countries now focus on having a strong economic base rather than having a powerful military to achieve their objectives with relatively low cost
Muhammad Estiak Hussain
Economic diplomacy for third world countries in the age of globalization

Economic diplomacy has been a very popular practice for the past 50 years. It has become the main instrument for the states to pursue its goals, develop relations with others and expand its area of influence. Especially, after the second world war, the global economic order has undergone great changes with the idea of globalization and free market economy. The economy becomes the main driver through which states enhance their political influence. In the post second world order, the Marshall Plan, which was initiated by the United States to rebuild the Western European economies, had political objectives. Also the creation of the European Steel and Coal Community was clearly economic as well as political. The development of General Agreement on Tariffs and Trade (GATT) which became the World Trade Organization (WTO) in 1995 and the foundation of World Bank (WB) and also the establishment of International Monetary Fund (IMF) to control the trade and financial system became the instruments of powerful countries in pursuing its foreign policy goals.

Every state has their foreign policy objectives. And diplomacy is the instrument through which states pursue their goals and implement those policies. In the age of globalization and modern warfare, the use of military means is not preferred which may help to achieve one’s foreign policy objectives but with a higher cost. As a result, we can see the use of economic diplomacy gain huge popularity. Robert Gilpin defines economic diplomacy as the use of political means as leverage in international negotiations, with the aim of enhancing national economic prosperity, and the use of economic leverage to increase the political stability of the nation. Baldwin calls economic statecraft which is the strategic use of positive and negative economic sanctions such as trade embargoes as well as aid programs by states and other actors.

Necessity of economic diplomacy from the third world perspective

Economy is the main driving force of the twenty-first century. Powerful countries boost their economic capability to survive in this current world order. Countries now focus on having a strong economic base rather than having a powerful military to achieve their objectives with relatively low cost. We often see powerful states like the United States and China use their economy in the form of sanctions, embargoes, tax hikes against each other and less powerful states to fulfill their demand. We can see the concurrent US-China trade war as an example of how the economy can be a great force in international relations. In this context, where economies become a great force in international politics, so called third world countries with their huge populations often have lower per capita income are far behind the developed countries in using their economy to their advantage in the negotiation table.

Political dimension

Third world countries are often dominated by developed countries for their weak position in world power structure. Their demands are often left unnoticed and ignored by the world community. Such as the urgency from third world countries to stop further environmental degradation by developed countries for their excessive carbon emission, industrialization often ignored in many environmental conferences. As they engage more with powerful countries economically, it will create some sort of dependency relationship, which in return gives them political security. Economic diplomacy is also necessary for ensuring future energy security for third world countries. As they have sometimes few natural sources of energy or lack of knowledge and technology about how to best use them. Economic diplomacy also helps to facilitate regional cooperation through trade which strengthens political standing collectively. We can see European Union as a great example of regional. Also, when third world countries engage in economic diplomacy with less powerful countries, it works as power equilibrium with powerful nations and open a new platform of relations.

Economic dimension

There is always a huge imbalance between the quantity of import and export in third world countries. These countries often have a huge workforce without minimum skill or knowledge, limited market, low investment rate, lack of infrastructure which hamper the economic growth. As these third world countries engage in economic diplomacy with other countries it will provide some push factors which will help them to take off for the better economic development. Economic diplomacy will provide huge opportunity to best utilize the huge man power in two ways. One way can be the migration of the workforce to another country. And another way as there is an abundance of manpower, the labor cost is very low. So that it will attract more Foreign Direct Investment (FDI). As per capita income and GDP increase due to the increasing foreign investment, it will bring more efficiency in work force and encourage people to invest more domestically and internationally. Massive transfer of modern technology and infrastructural development will come due to increase foreign involvement. Third world countries also have very few treaties like Free Trade Agreement (FTA) signed with other countries which maximize one country’s export. Through economic diplomacy, many new treaties can be signed with others.

Social dimension

When a country is both economically and politically devastated, its social welfare cannot be ensured. We often see the incapability of third world countries to deliver basic human needs to their citizens for their poor economic condition. As a result, various groups in third world countries often engage in conflict with each other for resources, living spaces and others, so that the society remains unstable.

So it is necessary for them to engage more in economic diplomacy. It works like some kind of virtuous circle of well-being. When one country engages in economic diplomacy, it enhances its political power as well as helps to maximize economic development. And when one country’s economic and political well-being is ensured, the social welfare will automatically come. State commitment to their citizens will meet and society will remain stable. These will create a conducive condition in which further development will be achieved.

The writer is a student of international relations, University of Dhaka

 

Comments

Video
More Opinion Stories
Generating new knowledge It is obvious that every research work is held expecting to create new knowledge. That’s why we say that research brings innovations to society and enlighten people. Not only that, research makes the impossible possible and…

Copyright © All right reserved.

Editor : M. Shamsur Rahman

Published by the Editor on behalf of Independent Publications Limited at Media Printers, 446/H, Tejgaon I/A, Dhaka-1215.
Editorial, News & Commercial Offices : Beximco Media Complex, 149-150 Tejgaon I/A, Dhaka-1208, Bangladesh. GPO Box No. 934, Dhaka-1000.

Editor : M. Shamsur Rahman
Published by the Editor on behalf of Independent Publications Limited at Media Printers, 446/H, Tejgaon I/A, Dhaka-1215.
Editorial, News & Commercial Offices : Beximco Media Complex, 149-150 Tejgaon I/A, Dhaka-1208, Bangladesh. GPO Box No. 934, Dhaka-1000.

Disclaimer & Privacy Policy
....................................................
About Us
....................................................
Contact Us
....................................................
Advertisement
....................................................
Subscription

Powered by : Frog Hosting