Why Has Regionalism Become Such a Popular Strategy to Cope with Globalization - Literature review Example

Why has regionalism become such a popular strategy to cope with globalization? Introduction The wave of globalization has been sweeping the world for more than two decades now. This period has also seen the emergence of regional initiatives which have changed the dynamics of trade relations among different nations. Previously regions were referred to territories that were mosaics of outward, inward and postcolonial policy regimes. But now regions evolve and are seen as a harmonious blend of strategies which are negotiated in order to pave way for the free trade agreements and development of policies that set new standards of doing mutual business. Under this backdrop, and even beyond it, regionalism-globalization compatibility has been often debated. At the time since regionalism form the first step (or even the first hurdle) towards globalization, it has become a popular strategy to deal with it. The paths to regionalism are largely paved with mutual agreements that either diverge from the globalization's path or simply point towards it. Global aspirations have begun to be seen more deeply through the pinhole of regional deepening and extension. In other words it is the regional trade that is expected to provide structural details of adjustment, liberalization and growth for a global trade. Regionalism advocates often argue that regionalism can be seen as the primary step towards ultimate evolution of globalization. This statement is supported by research on the subject, which have culminated either in sweeping generalities or landmark conclusions. Differing opinions, however, exist. This is because since globalisation is still new, certain issues with regard to regionalism are still pending resolution. But that is considered as temporary issue as in due course of time many things vis-a-vis regionalism-globalization combination will be creased out in due course of time. This is optimistically thought about because it is the regionalism only that has played immense role in dissemination of the benefits more liberal trade provides. At the moment it is widely accepted that regionalism is easier to effect on account of shared institutions, history and even lower transaction costs, both in new steady state economies and bargaining process. It is also held that regional agreement consummation forms an important precedent which is instrumental in building private and public institutional capacity which, in turn, more preparedness for further statutory and collaborative approaches to economic relations outside of the region (Whalley, 1996). Congruent to this, assert critics on the subject, in order to cope with globalization a new form of regionalism has emerged. It is capable of addressing what global multilateralism is supposed to be incapable accomplishing. Before this is further elaborated it is imperative to discuss both regionalism and globalism in their individual contexts. Globalization would not necessarily mean the same thing to two people as the term possesses consistent disagreement with regard to its consequences and sources. Most of the present-day globalization stems from the foundations laid soon after the Second World War, in which it mostly America that was instrumental in imposing a world order. The creation of the World Trade Organization, International Monetary Fund and United Nations represented a someday-vision of a borderless world and a borderless economy. Today, fortunately, the vision seems to be coming true since there has been a consistent growth in the world market. This market has essentially ‘transnationalizes’ financial, economic, political and environmental platforms of the world. All said, despite the mindboggling presence globalization has made on the world landscape, it is bound by a number of ineptitudes and inefficiencies. Toshiro Tanaka, a political scientist, believes that selectiveness is the main problem of globalization. He says benefits are evenly balanced by conflict misery and violence. Capitalist mode of production is considered as the source of globalization, and so is deregulation of markets and technological development. Regionalism, on the other hand, presents with the same vagueness of meaning as globalization. By region one doesn't imply only a geographical unit but also social system, which is characterized by factors like economy, security and culture or inheritance of a distinct identity. Also, in context of regionalism-globalization context it is important to differentiate between old concepts of globalization and regionalism. Today, much of the world is governed by what is popularly known as "new regionalism". Old regionalism was bipolar and most suitable examples could be Warsaw pact and NATO. It is because they were forced regional agreements and were on the side of hegemonic powers, acting inward oriented, implementing protectionist policies and specific intentions. New regionalism, on the contrary, is spontaneous and is born of a world order that is multipolar. New regionalism takes in its stride not only trade but other important issues too. These include social, environmental and security matters. It copes with globalization by making itself an indispensable part of a 'structural transformation' which though works at the global level but is actively involved at several levels beyond it. That makes it more multidimensional and comprehensive and a leveller in providing economic strength and securing markets through RTAs or Regional Trade Agreements. RTAs have gives regionalism strength to cope with globalization since it helps keep economic policies consistent and stable as violations by the participant country are not possible by way of sanctions which other members might provoke. Regionalism, as mentioned above, does more than fit into the realm of globalization specifically on the cultural front. When states are exposed to mutual cultural influences, they lose control over external relations of their societies. This is responded to by regionalism which helps increase cultural identity by way of promoting regionalist parties. Parti Quebecois Bloc can be cited as a perfect example since it has given Quebec a general cultural identity. It should be noted that Quebec in mainland America is the French speaking region and it stills clings to its Francophone tradition impressively. However the flipside of this is that there are certain weaknesses in modern globalization which it has not been suitably able to address. What makes up for this is the increasing sense of regionalism in the world. This puts on need on regionalism to be defined as new regionalism so that it could be developed as a world order concept. It can cope with globalization only if it shuns the regional overtones and centres on more global outlook and identity. If this does not happen regionalism with respect to globalization will only end up building up states and conflicts with these states on a larger scale (Aggarwal and Fogarty). Globalization has multilevel character and projects, between nations, an accelerated economic dependence within the world system. To some extent the same is amplified and mediated by mass media (Kottak, 1996). This results in change in many aspects these nations social existence. In other words that is the natural consequence of globalization. Globalization takes in its stride market, law and politics, thus limiting the national subjects' autonomy. This is because development of legislature and economy also means corresponding political changes. It further creates dependence on foreign capital while increasing the transnational companies' activities which, to some extent, reduce a state's influence in its own territory. In other words the states have to make atmosphere conducive for globalization to take place on their territories. Steinmetzová (2005) has remarked that globalization leads to the instrumental changes left for political elites to choose from. It can be deemed that regionalism accounts for some definitions of economic globalization, where the later transforms itself from a given geographical significance to a more institutional one; giving in the process a new meaning to it, which is new regionalism. The regionalism imparts a new meaning to the development of international labour division since it is capable of interconnecting different economic subjects from within the home territory and beyond the same. Geographical barriers get transcended, economic cycles get harmonized and security rates and rates of interest get converged. Susa (2004) has termed it as a "process of relative contraction of time and space". Oi (2005) has remarked that space is preceded over by time and the regionalism spoken of in this context is not the same as geographical regionalism. Regionalism is a possible reaction of globalization and a means of protecting regional interests in an economy which is globalized. It is a systematic approach that enables regions to safeguard their interests in the global market place by prioritizing governmental strategies, economic subjects and security and political matters. It even helps identify sphere of activities that could fit into the global context (Kucerová, 2006). How regionalism copes with globalization can be seen from two different standpoints. One, it integrates with global market, which is known as open regionalism. Two, it offers a resistance to the forces operating in the global market. Hurrell (1995) has pointed out that a common foundation on which globalization works in a regional context is that it increases nation-state interactions through flows of money, goods, ideas, people, information and images. This interaction makes territorial boundaries less salient, one reason why growth of economic regionalism in context of globalization becomes a paradoxical phenomenon. Paradoxical because there seem to be interplay of two diverse interests going side by side to each other. Globalization makes boundaries less emphatic but regionalism attempts to re-impose the same boundaries in a different context and at a different level. In this process larger spaces get carved out of smaller ones. But, in order to operate effectively and despite the differing ends, regionalism has to mandatorily accommodate itself in the wider global context. Open regionalism is the widely analysed form of regionalism whenever its space within the context of globalization is discussed. It is a sort of a way station that leads to globalization, which creates involvement and encourages participation by different economic actors. Open regionalism has a far greater place in globalization than the limiting one. It is because globalization is all about openness. Higgott (2000) has stated that unless regionalism is open emphasis cannot be strong on globalization. This is on account of the fact that globalization is not just about economic factors only but it is also about world cognitive/ ideational and institutional forces that drive political economy. Hughes (2000) has remarked that globalization has a potential to 'reconfigure social space' since it is unlike liberalisation and internationalisation. The reconfiguration of economic space itself relates to regionalism. In order to understand this it is important to understand globalisation's constituent dimension. However, reconfiguration of economic space should not be construed as something that can lead to absence of territoriality. Since territoriality is inclusive, in the intertwined relationship of regionalism and globalisation, positive drift of mind towards regionalism can be found in corporate actors. The drift is more pronounced where regionalism is strongly entrenched in globalisation. However, what role regionalism plays in globalisation and how exactly it is viewed depends much on the behaviour of corporate actors with respect to both. These actors are generally seen to act under the influence of their political and social contexts. Gamble and Payne (1996) have remarked that for regionalism to cope with globalisation it is important for it to display an outward-looking nature. In absence of this nature, remark Grugel and Hout (1999) the concept of regionalism takes a 'closed' form and leads the whole thought back to 1960s and 70s. Theoretically, in the globalisation-regionalism context, open regionalism is the model that cements the two and greater degree of compatibility between them. The most direct and positive impact of this type of regionalism is that it does not impose any types of restrictions or barriers on non-partners if the relationship is already in practice among other two partners. Instead it opens doors for new members to join and form new arrangements. When cooperation is sought among large numbers, governments have to pass through regionalism in order to make the cooperation possible. It is can be deemed as a policy interim to globalisation and offers a solution to problems that require collective solutions. Mittelman (2000) has remarked that the best example of how regionalism is capable of coping with globalisation can be seen in European Union, even though as stated by Hveem (2000) globalisation may not be able to use regionalism for a vehicle for long, which means it should not be considered as just only a static tool to further the cause of globalisation. Conclusion It can be concluded that for globalisation to take place regionalism forms one of the pillars. It acts as a vehicle on which globalisation rides. It is an instrument which governments use to pool their resources so that globalisation can make inroads into their territories. Open rather than closed regionalism work positively in fostering the regionalism-globalisation relationship and over a period of time have created new regionalism, which is seen as more relevant in the present globalised world. References Aggarwal, V.K. and Fogarty, E.A. (2004). EU trade strategies: Between regionalism and globalism. Basingstoke : Palgrave Macmillan. Gamble, A. and Payne, A. (1996) ‘Conclusion: The New Regionalism’, in Andrew Gamble and Anthony Payne (eds), Regionalism and World Order, London: Macmillan, pp. 247-264. Grugel, J. and Hout, W. (1999) ‘Regions, Regionalism and the South’, in Jean Grugel and Wil Hout (eds), Regionalism Across the North-South Divide: State Strategies and Globalisation, London: Routledge, pp. 3-13. Hveem, H. (2000) ‘Explaining the Regional Phenomenon in an Era of Globalisaton’, in Richard Stubbs and Geoffrey R.D. Underhill (eds), Political Economy and the Changing Global Order, Oxford: Oxford University Press, pp. 70-81. Hurrell, A. (1995) ‘Regionalism in Theoretical Perspective’ in Louise Fawcett and Andrew Hurrell (eds) Regionalism in World Politics, Oxford: Oxford University Press, pp. 36-73. Hughes, C.W. (2000). Globalisation and Security in the Asia-Pacific: An Initial Investigation: CSGR Working Paper No. 61/00, Coventry, UK: Centre for the Study of Globalisation and Regionalisation, University of Warwick. Higgott, R.A. (2000) ‘Back from the Brink: The Theory and Practice of Globalisation at Century’s End, in Mely C. Anthony and Jawhar Hassan (eds) Beyond the Crisis: Challenges and Opportunities, Kuala Lumpur: Institute of Strategic and International Studies, pp. 67-91. Kottak, C. (1996). 1996. Mirror for humanity a concise introduction to cultural anthropology. New York McGraw-Hill. Kucerova, I. (2006). Nový regionalismus versus geografický regionalismus. VZ FSVUKlistopad 2005.In sborník matfyzpress, pp. 67–89. Mittelman, J.H. (2000) The Globalisation Syndrome: Transformation and Resistance, Princeton, New Jersey: Princeton University Press. Oi, C. J. (2005). Corporate Restructuring and Social Security in China’s State Owned Enterprises. In Managing Globalisation, NU of Singapore. 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