Pushing the inclusive global prosperity envelope in an age of nativism

ON June 23, 2016, close to 52 per cent of British electors voted for Brexit. Peter Ricketts, former United Kingdom ambassador to France, called Brexit a "true disaster" during the Rencontres Economiques d'Aix-en Provence Forum held shortly after. Shaken, the European Union is searching for a new path forward while coping with turbulence affecting the world economy. Donald Trump's recent election to the United States presidency reinforces the growing influence of populism, nativism, and protectionism in global politics. We face many challenges ahead: an ageing world population, a slowdown in productivity, digital disruption, and fast-growing inequality. How can the world surmount these massive challenges without international collaboration of the highest quality?

The Rencontres Economiques forum, held outside France for the very first time in Singapore at ESSEC Business School's Asia-Pacific campus, aims to promote an international dialogue between global thought leaders to find solutions to the problems of our time. Withdrawing into the proverbial shell is not the right solution. Our world will change, upheaval will follow, and countries worldwide cannot passively give in to nativist sentiments. The EU, in particular, must overcome internal struggles, and commit itself to identify new opportunities created by the British departure and American situation, notably by turning towards Asia, Africa, and Latin America.

Asia is already a key focus for the EU, with Singapore being France's leading trade partner within Asean. However, implementation of the EU-Singapore free trade agreement, finalised in 2014, has been delayed by a conflict between the European Commission and the European Council and is awaiting arbitration from the EU Court of Justice. Blocking the free trade agreement - the first between the EU and an Asean member - would be regrettable given that Asean is the EU's third largest trading partner and represents nearly 600 million consumers.

GLOBAL POLITICS

Singapore must keep a close eye on global politics to identify new opportunities. Tharman Shanmugaratnam, Deputy Prime Minister and Coordinating Minister for Economic and Social Policies, guest-of-honour at the Rencontres Economiques forum, declared in Parliament several days after the British vote : "We must expect a period of economic uncertainty over the next few years at least. We will continue to watch these developments closely, be prepared for their impact on Singapore, and see what lessons might be useful for ourselves."

One cause of the growing plague of nativism may simply be unfamiliarity with the lives and aspirations of others. While young Singaporeans have historically favoured the Anglophone world, there are tremendous opportunities for cultural, scientific, and economic collaborations between the EU, Singapore, and Asean. Promoting the free exchange of students will help our youth familiarise themselves with different cultures, and learn how to collaborate across borders. This approach guarantees that our youth acquire fundamental skills and knowledge, promotes technological progress, and positions our universities at the leading edge of research and innovation. Solving these education challenges for the next generation together will form a sound basis for our future society.

The EU and Asean must, in the coming years, strive to be a critical part of the leadership of world economic governance, notably monetary governance. The international monetary system reflects national interests and sometimes dangerous power games. Critiques of the renminbi may have helped propel Donald Trump to the presidency, but risk destabilising the global economy to the detriment of all. In this new context, the eurozone and Asean member countries have a unique responsibility to become allies promoting an inclusive international monetary order that supports trade, investment and growth globally. We must take heed of what Michel Aglietta, professor of economics at the University of Paris, calls the "monetary cooperation and an ultimate universal liquidity which is the debt of no country".

More than ever, Singapore and the EU must be leaders of a world economic governance seeking to re-establish inclusive global prosperity. This is the position that the Cercle des économistes, ESSEC Business School, and Paris Europlace will defend alongside the Economic Society of Singapore during the Rencontres Economiques in Singapore on Nov 24 and 25. It is our responsibility as the world's gaze is upon us.