Jomo Kwame Sundaram’s Blog

A gathering ‘perfect storm’ – due to various developments, several quite deliberate – now threatens much devastation in the global South, likely to most hurt the poorest and most vulnerable. Globalisation's protracted decline The age of globalization had mixed consequences, unevenly incorporating national markets for labour, goods and even some services. It ended gradually, with the trend far more pronounced following the protracted worldwide stagnation since the 2008 global financial crisis. Sometimes still referred to as the Great Recession, Western central banks resorted to unconventional monetary policies, mainly ‘quantitative easing’, to keep their economies afloat. But easier credit enabled more…

Investor-State Dispute Settlement (ISDS) provisions in international trade and investment agreements – long abused by opportunists with means – are slowly being rejected by cautious governments. Developing country governments need to be much more wary of ISDS and its implications, and should urgently withdraw from existing commitments. They should expunge ISDS clauses in existing trade and investment agreements and exclude them from new ones. ISDS ripe for abuse ISDS allows a foreign investor to sue a ‘host’ government for compensation by claiming new laws, regulations and policies adversely affect expected profits, even if changed in the public interest. It involves…

Contractionary economic trends since 2008 and ‘geopolitical’ conflicts subverting international cooperation have worsened world conditions, especially in the poorest countries, mainly in Africa, leaving their poor worse off. Conditions and prospects are so bad that two well-known globalisation cheerleaders have appealed to rich nations for urgent action. Former IMF Deputy Managing Director and World Bank Senior Vice-President, Professor Anne Krueger and influential Financial Times columnist Martin Wolf warn ominously of the dire consequences of inaction. Deepening stagnation Following tepid growth after the 2008 global financial crisis, Covid-19 disrupted supply chains worldwide. Then, post-pandemic recovery was disrupted by wars in Ukraine and then Gaza. Food and energy…

Ungku Aziz was seen by many of his contemporaries as a ‘Renaissance man’ — a man of letters, a man seriously interested in the arts and, philosophically speaking, one who appreciated knowledge, ilm, science\ All of us are undoubtedly much influenced by the circumstances in which we live. Profesor Diraja Dr Ungku Abdul Aziz Ungku Abdul Hamid (Jan 28, 1922 to Dec 15, 2020) chose a path less well taken by his peers of privilege, dedicating himself instead to a nation not yet born, to the poor, the solidarity economy and conserving the rich cultural heritage of the Malays. After…

At high cost and with dubious efficiency, public-private partnerships (PPPs) have increased private profits at the public expense. PPPs have proved costly in financing public projects. PPPs’ high costs Eurodad has shown high PPP costs mainly due to private partners’ high-profit expectations. Complex PPP contracts typically involve high transaction costs. Worse, contracts are often renegotiated to favour the private partners. They also take advantage of lower government borrowing costs compared to private borrowers. Most PPP debt costs are ultimately borne by host governments but are often obscured by the secrecy of contracts. PPPs are often not on official government books or…

World Bank aid encourages governments to enable illicit financial outflows to offshore tax havens by reducing capital controls, thus draining precious foreign exchange and government resources. Aiding elite wealth Aid disbursements to highly aid-dependent countries coincide with sharp increases in bank deposits in offshore financial centres known for banking secrecy and private wealth management. Using Bank for International Settlements (BIS) data, Jørgen Juel Andersen, Niels Johannesen and Bob Rijkers found trends suggesting wealth accumulation abroad by national elites coinciding with World Bank aid disbursements. Capital outflows follow aid inflows apparently captured by ruling politicians, bureaucrats and their cronies. In the 22…

Muchos en el rico Occidente o Norte industrial han tergiversado las causas del calentamiento planetario, ofreciendo falsas soluciones mientras reclaman una alta moral en ese terreno. Esto distrae la atención de cómo se hicieron ricos mientras emitían gases de efecto invernadero. ¿Tragedia o farsa? Las crecientes emisiones de gases de efecto invernadero (GEI) en la era industrial han provocado el calentamiento global, y su acumulación continúa acelerándose a pesar de estar cerca de superar el incremento de 1,5°C y sus puntos de inflexión asociados. A veces se dice que esto se debe a la incapacidad de gestionar de forma sostenible…

En las últimas décadas, se ha culpado del fracaso del progreso económico a una supuesta trampa de los países de renta media. Esta acusación oculta tanto como supuestamente explica. La fábula de la trampa de los países de renta media comenzó como una historia del Banco Mundial sobre por qué los países de renta media alta de América Latina no lograron convertirse en países de ingresos altos tras aplicar las políticas exigidas o prescritas por las instituciones de Bretton Woods. Con la trampa de la renta media los teóricos del desarrollo económico argumentan que un país que llega a ese…

The World Bank insists commercial finance is necessary for achieving economic recovery and the Sustainable Development Goals (SDGs), but does little to ensure profit-hungry commercial finance serves the public interest. By failing to address pressing challenges within their purview, the second-ever Bretton Woods institutions’ (BWIs) annual meetings on the African continent, in Marrakech in October 2023, set the developing world even further back. The International Monetary and Financial Committee, which oversees the International Monetary Fund (IMF), could not agree, by consensus, on the usual end-of-meeting ministerial communique for ‘geopolitical’ reasons. The Development Committee, which governs the World Bank Group, fared…

With the US Fed raising interest rates, the world economy is slowing as debt distress spreads across the global South, increasing poverty worldwide to pre-pandemic levels, with the poorest countries faring worst. Extreme poverty continues to be high and is now worse than before the pandemic in low-income countries (LICs) and among those affected by fragility, violence and conflict. The promise of eradicating poverty worldwide by 2030 has become unachievable. The Bretton Woods institutions’ (BWIs) annual meetings in Marrakech in October were only the second-ever in Africa. But the rich nations-dominated BWIs failed yet again to rise to the challenges of…