Geo-economics, Globalization and the Covid-19 Pandemic: Trade and Development Perspectives from Bangladesh

Abstract

With the Rise of China, world trade and globalisation are now passing through turbulent times. Since the global financial crisis of 2008, there has been a sustained deceleration in international trade and investment flows marked by globalisation backlash, tariff wars, and COVID19 induced heightened policy measures focusing on diversifying supply sources away from China and decoupling of the world’s two largest economies—United States and China—to undo interlinked supply chains built over several decades. The emerging geoeconomic order, putting the existing architecture of the global trade and investment under pressure, brings a new spotlight on the development prospect of a country like Bangladesh, which has registered impressive socio-economic advancement over the past decades and is now set to graduate from the group of least developed countries (LDCs). Bangladesh would expect a credible, inclusive, and rules-based international trading system to support its development transition and in attracting investments and exploring new trading opportunities. The unsettling global trade environment is thus of particular concern. Bangladesh also wants to benefit from being geographically located in the vicinity of the world’s two largest growth centres in India and China. The geopolitical rivalry of the two countries, however, makes the region a geoeconomics powerplay ground. Within the general tumultuous terrain of global and regional cooperation, there are certain opportunities—for example, securing trade preferences, foreign investment, and financial assistance—that must be exploited prudently without being a victim of geopolitical competition of rival economic powers.