POVERTY is still a major issue plaguing the modern world. In the 65 countries including China along the Belt and Road route, only 18 are high-income countries, with the per capita GDP reaching US $27,000. There are 22 countries in the upper-middle-income bracket as the average per capita GDP in these countries stands at US $7,000. The number of lower-middle-income nations is 23, having an average per capita GDP less than US $2,500. The remaining two, Afghanistan and Nepal, have their GDP per capita share of US $1,000.
Poverty: the Direct Result of a Flawed Global Governance System
In addition to domestic factors that result in poverty, international ones also exert impacts on regional development, and global governance is a non-negligible factor. If the global governance mechanism is capable of providing timely and effective support to underdeveloped countries or regions, the situation may be different.
Zhejiang Wuyi Electric Tool Exhibition attracts the countries along the Belt and Road.
The global governance apparatus, in fact, has significantly contributed to elevating a number of countries from underdeveloped circumstances to developed ones. The development of China over the past four decades is a case in point. After the initiation of the reform and opening-up, the country managed an average annual economic growth of 9.5 percent and raised over 700 million poor people out of poverty. The achievements not only originate from its own strength, but also from the global governance system, which channeled in both direct financial support and intellectual and knowledge-based backup.
But the global governance system today is still encumbered by shortfalls. For instance, the public goods and services provided by global governance institutions to less developed countries are seriously inadequate, the loans and aid offered to the world’s poorest nations are also insufficient.
From the aspect of quality, some global governance institutions, such as the International Monetary Fund and the World Bank, when devising institutional reform schemes for less developed countries, often fail to advance targeted policies and strategic proposals due to lack of comprehensive consideration of divergent circumstances in different nations, only offering a “panacea” with the intention to “cure all diseases.”
Global Governance Mechanism Reform: the Irresistible Trend
In order to power the development of an enormous quantity of impoverished developing countries, a significant step is to reform and improve the current global governance system. In this way, global governance institutions will provide more and better public goods and services to the vast majority of developing countries.
The First Investment Summit of China-Myanmar Economic Corridor is held in Yangon, Myanmar.
One of the most prominent features marking our age is that innovation serves as the most vital driving force for progress, both in developed and developing countries. Fueled by strong innovation, new phenomena based on technological advances have emerged, which also serve as the source of new momentum to accelerate economic and social development, such as big data, artificial intelligence, cloud computing, robotics, and the blockchain. The most prominent one is the sudden rise of the digital economy.
In a digitalized world, especially as the role of blockchain continues to strengthen, the highly centralized global governance system will gradually evolve into a decentralized and multi-polarized state. As decentralization increases with enhanced multi-polarization, the degree of openness of the global governance mechanism will expand accordingly, and an increasing number of developing nations will be accorded with more opportunities to join in.
In order to catalyze the shaping of the new global governance mechanism as soon as possible, all countries could make joint efforts from varied aspects. Currently, China is devoting great energy to the joint construction of the Belt and Road Initiative (BRI), a new international cooperation platform to contribute its strength to reforming and perfecting global governance.
A More Rational Global Governance Mechanism Is Needed
Innovation and technological advances will eventually lead to the transformation of the global governance system from a centralized apparatus to decentralization, from closure to openness, and from monopolization to sharing.
The BRI is a platform for international cooperation, in which any country and region can participate, regardless of their status as a developing or developed country, Africa, Asia or Latin America; there is no geopolitical machination but absolute inclusiveness. The platform can, to a great extent, address the defect of inadequate inclusiveness plaguing the existing global governance system. At the same time, it can provide the basis for the participation of all countries and their joint contribution of strength to resolve the problems concerning globalization.
The priority is focused on creating an interconnected global network. Sound interconnectivity plus more generalized participation will guarantee the shaping of an improved global governance system.
The BRI is carried out under the principle of pursuing shared growth through consultation and collaboration, and all the participating parties, leveraging their respective resource endowment, utilize comparative advantages and conduct equitable cooperation to ultimately achieve mutual benefit and win-win outcomes. This contributes to the realization of the goal of inclusive and common development.
The current age is ushering in the Fourth Industrial Revolution. All countries around the globe are confronted with profound changes unseen over the past century; there exist severe challenges and huge development opportunities. Developing nations, in particular, should they succeed in making good use of this new historic opportunity, will possibly achieve a great leap in development.
In order to promote the BRI, China, together with related countries, in line with their practical needs and common desire, has innovatively established a number of new global governance institutions, such as the Asian Infrastructure Investment Bank and the New Development Bank, which are the newly added global financial governance bodies. This will directly help increase the supply of funds to underdeveloped countries and regions in the world which face difficulty in obtaining financing from the current international financial institutions, and accelerate their development.
In short, the joint construction of the BRI is beneficial in enhancing and strengthening the global governance mechanism from different aspects. As understanding of the initiative deepens, a broad consensus is built, and measures are put in place, the existing global governance system will be further improved and play a more important role in driving global common development.
HU BILIANG is the executive president of the Belt and Road School with the Beijing Normal University.