Global Growth to 2050: Demographic Trends and the New World Order

July 2, 2014

Talks & Interviews

Dr. Adam K. Webb

:Dr. Adam K. Webb, Resident Associate Professor of Political Science at the Johns Hopkins Nanjing Centre, China and former Visiting Scholar at the American Academy of Arts and Sciences was invited to deliver a talk on “Global Growth to 2050: Demographic Trends and the New World Order“ at the Centre for Public Policy and Governance on Jan 16, 2013.

Webb opened his talk by stating that although predicting future political trends was a challenging task due to the uncertain nature of political events, still certain long-term trends were obvious enough to make political projections. Unlike many forecasts that envisioned transition from Western to Chinese hegemony, Webb presented a third scenario based on political demography, which would change the world in unprecedented ways.

One obvious trend was the relative decline of the power of the West in the last century that included both economic and demographic factors. The economic trend depicted that the combined share of the Western world broadly represented by the US and EU, in global GDP had declined from 60% in 1913 to 48% today. Economic projections further showed a steady decline in the coming decades to 34% in 2020 and 21% in 2050. This largely reflected that as poorer regions of the world began to catch up economically, there would be a rough evening out of living standards across the world. The demographic aspect was equally striking as the share of West in world’s population that was about 1/3rd in 1913 was predicted to decline to 1/10th in 2050. So the economic and demographic decline of the West was a fairly obvious long-term trend.

The rise of China had analysts forecasting that the Chinese economy was expected to surpass the US, and could make up as much as 30% of the world’s GDP by 2050. Webb raised the question: how peaceful would this hegemonic transition be? He went on to describe a number of possibilities: first, a peaceful transition of world leadership from US to China and eventual peaceful cooperation between the two nations to shape the world economy; second, a violent confrontation by the year 2030 as suggested by some strategic thinkers. However, the aforementioned scenario was too simplistic considering that a large number of other powers were rising as well. These included the emerging countries of BRICS: Brazil, Russia, India, China and South Africa. A broader classification of emerging E7 economies included the BRICS economies, and Indonesia, Mexico, and Turkey. The shift of the influential world economies towards these emerging powers was very striking. So within the G20 block that included majority of the industrialized and developing economies, the economic share of the industrialized G7 countries would drop from 72% to 41% while that of the five developing countries China, Russia, India and Brazil and Mexico would rise from 20% today to 51% in 2050. Thus major developing economies would have the largest share of the global economy.

He suggested that each of the future possibilities included the rise of China or BRICS or E7, which led him and others to a few conclusions: first, that the West would steadily lose bargaining power vis-à-vis one or several competitors; second, that this power shift would happen in the same terrain as great power real politic assuming that rising countries would pursue a conventional policy of national self-interest, while their political and economic weight would determine winners and losers, ruling out any form of political alignment; third, that centrality of China’s rise would lead to a regression of West led globalization and a reemergence of emphasis on national sovereignty. The three main predictions made by observes in this regard were a natural hegemonic transition from US to China, a multipolar version of real politic and a return to hard-shell national sovereignty.

However, he made a case to argue that none of these (three) images of the future were likely to be true as there was going to be more room for multilateral cooperation, cosmopolitanism and reform of the world system, while the global demographic change would also shift the global power balance in a number of ways. The center of gravity of world population had shifted steadily towards the South, away from the West as well as from China. Population patterns of 2010 and 2050 showed that the combined share of the West and China shrank dramatically. For example, the labor force of Sub-Saharan Africa in 2050 would be larger than that of China as Chinese population control measures had resulted in Chinese demographic projection similar to that of Europe and Japan by 2050. Global influence depended on demography as well as economic growth while demographic trends were easier to predict than growth and development. Thus, greater number of poor people in the global South was not necessarily to its advantage, however economic growth of the South would increase faster over the same period for three reasons.

“… economic and demographic decline of the West was a fairly obvious longterm trend”

First, Western economies’ long-term growth had averaged around 1% a year over the last several decades and there was no indication that it would pick up in the near future. The global financial crisis had been one of the reasons for it. Second, it was unlikely that Chinese economic growth would continue at the same fast pace as in the last three decades. China was now entering the middle income track primarily due to barriers to innovation, demographic pressures of a shrinking labor force, internal institutional obstacles to growth, corruption, lack of rule of law and political reform issues. These factors prevented China from progressing from a middle income economy to an advanced innovation based economy. Third, on average poorer countries tended to grow faster as their basic economic and demographic realities favored a higher rate of long-term growth (higher return to capital and a more hospitable environment for investment). Thus combining both economic and demographic prospects, one could expect that the global South’s share of the world economy would increase markedly between now and 2050. The next 10 countries in population size after China, India and US were Indonesia, Brazil, Pakistan, Nigeria, Bangladesh, Mexico etc., which each had about 2-3% of world’s population individually. Although, this placed them in a league of lower global influence on their own as compared to China, West or others with at least 1/10th of the global economy, still demographic trends suggested an increase in their share of global power. This did not imply world dominance by Latin America, Africa, Middle East and South Asia, but that their relative influence would be greater than it had been at any time in the modern era.

Webb then explored what a southward shift of global influence would mean. He stated that the character of each state and society shaped its foreign policy as apart from a country’s size and regime type, internal attributes as well as cultural contours of a society influenced its international relations. Thus, the nature of societies of the global South had to be understood. He suggested multilateralism, internal diversity and cosmopolitan potential as three important characteristics of the majority of these societies that would have significant global implications.

The first would be arise in multilateralism. Small and middle income powers were classic multilateralists; for example, Canada, Sweden, Spain had been active in multilateral cooperation with global influence. This was also increasingly true for countries like Brazil and South Africa. Both countries took a leading role in regional associations and engaged in mutual intercontinental dialogue. Elaborating further, he explained that a number of enduring rule based frameworks were emerging in many regions, based loosely on the European Union model. In South America, the Union of South American Nations (UNASUR) was consciously modeled on the EU and was focusing on open trade, common currency, freedom of movement across borders, and democratically elected super-national institutions. In the case of Africa, the African Union had taken an active role in supporting interventions in Somalia and Mali. It had also created a Peace and Security Council, which could issue binding decisions on member states. These regional experiments suggested an increasing openness to multilateralism among small and medium powers than was the case a decade or two earlier.

The second important characteristic of countries in the global South was diversity that disrupted any exaggerated themes about nationhood. While in the classic nation state model, there was one nation, one people, one culture, one state, but this did not apply to most southern countries. In Latin America, the colonial patterns of settlement and intermarriages had created what was called the“cosmic race”- a mixed population of European, indigenous and African ancestry. These diversities were built into the texture of these societies showing that culture and polity need not dovetail. Such diversity was at odds with historic European nationalism, and the relentless civil assimilation in the US that eroded multiple identities to merge them into one. Similarly, the concept of Chinese nationalism had also tried to somehow encompass the wide-ranging diversity and multi-ethnicity of the society. Thus, if the global South influenced the mainstream global public opinion then older forced models of nationhood would seem an oddity on the global stage.

“The center of gravity of world population had shifted steadily towards the South, away from the West as well as from China.”

Lastly, he suggested that countries of the global South were deeply predisposed to cosmopolitanism*. World values survey showed that there was a high level of cosmopolitan sentiment among the people of Africa and Latin America. A startling statistic showed that out of the poorest section of Brazil, a quarter identified with the world as a whole. The Arab Spring had also spread in large part because of this cross border consciousness. Such trends showed transnational identity and activism. Contrasting this with expected power centers of the world, places like US, UK, China, Japan and Korea, where one expected a higher level of global consciousness, instead faced significant obstacles to being genuinely cosmopolitan. For instance, China relentlessly used the official media and the education system to socialize its citizens in what it called “unique national conditions”.

Based on the above articulation, Webb argued that rise of the South would transform our mental landscape, and the greater its influence, the more it will disrupt the racialized world view of the last two centuries. Instead, it would influence the phenomenon of “brown racism”, the racism displayed by Asians towards those of relatively darker skin. Moreover, it would mix and blur identities creating a more accepting attitude towards racial heterogeneity. Elaborating, he stated that current trends in global migration suggested two key directions. First was the northward migration, i.e. migration to the US and Europe, which was creating a South within the North. Statistics showed that by 2050, the American population would be majority nonwhites and the EU would be 20% Muslim. The second category was South to South migration, particularly within each region. Cross border migration within Latin America, Africa and the Middle East had picked up in the recent years. This global rebalancing may lead to a proliferation of South-South ties.

Further, he stated that the meaning of globalization was context and country specific. Most of globalization had been centered in the US, Europe and Japan, if assessed through flight routes and international telephone traffic. However with the rise of the Southern countries and strengthening of South-South ties, the meaning and implications of globalization would transform. A manifestation of this change was the Chinese investment and economic engagement with Africa and else where in the global South. Although, the nature of current engagement was elite based state to state economic ties, still in the long-term, these ties were expected to diversify across various regions and one that encapsulated civil society and more diverse people to people networks. Thus, a multi-track diplomacy was needed as opposed to purely state to state diplomacy, which was not sustainable in an era of increasingly assertive publics, exemplified particularly by the Arab Spring.

He then explored the subject of ideology and argued that the southward rebalancing would fundamentally challenge the contours of liberal modernity as most Southern societies were highly religious as compared to Europe, Russia, Japan and China and relatively more than even the US. Similarly, there was also a high degree of political salience of religion in the global South. Thus, these demographic trends as well as higher birthrates of religious versus secular populations would result in increasing the weight of religion in coming decades. Among religions, Christian and Islamic populations combined had a clear majority and were largely concentrated in the global South. While Christianity’s center of gravity had shifted southward to Latin America and Africa compared to Northern Europe in the recent decade, Islam was gaining new converts in Sub-Saharan Africa while population growth rates of existing Muslim countries was very high.

Both these religions were avowedly universalistic, spoke to humanity at large across cultural and geographic boundaries and provided a moral language on issues like social justice, ethics, and political legitimacy. Will a growing youth bulge, a larger labor force and widespread poverty, there would be an intense demand for reform and social justice. Thus, religions gaining ground could result in the erosion of the primacy of the nation state.

“… combining both economic and demographic prospects, one could expect that the global South’s share of the world economy would increase markedly between now and 2050.”

Lastly, Webb discussed the various policy options for countries during this transition period. He argued that the foreign policy of Southern governments would adapt and transform based on three factors: one, Southern public opinion was likely to become more assertive and globally aware; two, a growing concern and interest in inter-regional affairs which may transform regional transnationalism into global transnationalism; three, awareness of the growing importance of transnational networks as many Southern state movements were rising to power based on their support. He argued that EU and India would potentially have a decisive balancing role. EU could slow down broadening of global participation by defining its political and economic interests narrowly or it could expand the logic of transnational integration to shape new global structures. Similarly India could pursue a unilateralist rise in power along the same lines as China, or pursue more multilateral foreign policy to engage with other rising global centers. China would face a fundamental choice between openness and multiculturalism vs economic stagnation, as its technocratic authoritarianism had little resonance with mobilized publics in any society. She would require a democratic transition and tempering of hegemonic aspirations to develop soft power as its shrinking labor force required importation of labor from other countries. In conclusion, he reiterated that a simple shift from Western to Chinese hegemony was unlikely. Instead, he predicted that a third force, the global South may emerge to be more powerful than either of the two main powers.

The talk was followed by a lively question and answer session. In reply to a question regarding India’s inclination towards unilateralism, and whether Pakistan’s emergence as a highly populous country in 2050 would affect South Asia’s geopolitical balance, he asserted that there were polarized thinking currents within India. While Hindu nationalists had an insular and exceptional view of Indian national identity leading to a unilateralist view of international politics, others viewed India as part of the global South and thus potentially influential on the global stage by forming alliances with other Southern countries. He stated that while population would not affect South Asia’s geopolitical balance, for Pakistan to guarantee its freedom of action and interests, a multilateralist approach was required that diversified its ties beyond the two major powers, China and US.

In response to a question regarding the importance of human capital in comparison with population and the role it would play in global influence, he asserted that education levels would be important in either multiplying or hampering the influence of increasing populations. However, in terms of greater political engagement, influence and activism, the minimum threshold of education levels required was not that high. A fairly literate population that could engage and articulate through some sort of communication technology could network politically on a large scale. Rapid technological development leading to increased access across social and geographical barriers, enabled populations to assert themselves in unprecedented ways.

In response to a question relating to a potential conflict over official language and religion in the global South, he accepted a current lack of practical economic motivation of learning a foreign language other than English, however with increasing South to South ties, demand for diversifying language competencies would increase. Discussing religion, he articulated that there were two ways of looking at religion. One, as a marker of identity that distinguished from other groups and second as a basis for common ground, which could potentially play a unifying force and provide an incentive for forming alliances.