The Dream: Global Trade Relations in a New World Order

Abstract

“East Asia’s stunning development path owed much to the nature of American power and of the region’s structure of alliances, producing economic successes that have never been matched elsewhere. The United States not only guaranteed the security of Japan, South Korea and Taiwan, allowing them to focus on economic development; it also provided them with the incalculable advantages of technical assistance, educational exchanges and nearly unfettered access to America’s vast markets. Crucially, it did not, at least initially, insist that these countries open their own markets in return. It took two decades for China to come out of its shell when America’s then president, Richard Nixon, paid a visit to Beijing. The ground for China’s opening to America was prepared by a rupture in its relations with the Soviet Union in 1960. For over four decades it has been an unambiguous beneficiary of the American order. Without America to keep its neighborhood secure and underpin open markets, China could not have reaped such gains from the market-led reforms it launched in the late 1970s.” The Economist (2017b). This chapter aims to illustrate how shifts in the global economic order have developed – and have been transformed over the years – as well as consequences of new trade relationships for the current US administration in its bid to restore the country to its leading global economic role.