New 3-tier global trade system may be worth considering

THE recent World Economic Forum at Davos had Indian Prime Minister Narendra Modi and US President Donald Trump as the bookends. Mr Modi, like Chinese President Xi Jinping last year, spoke in favour of free trade and against protectionism. Mr Trump repeated his concerns on current trade imbalances.

Significant sections of the Western world are agitating against globalisation. While there are also cultural aspects to the anti-globalisation movement, clearly the economic malaise afflicting the Western countries in terms of stagnant wages and rising inequality is driving much of the angst.

The one monumental change that has triggered much of this economic malaise in middle America (and in Europe) is the entry of China into the global economic system.