Blogger’s Note. Reflecting upon the a recent “long read” published in the Guardian – an absorbing piece by Nikil Saval entitled “Globalisation: the rise and fall of an idea that swept the world” – I was rather jarringly reminded of something I wrote back in the nineties. What strikes me about this vintage analysis, published in the International Journal (53:1, Winter 1997, pp 17-37), is just how little the debate has advanced over the intervening two decades. It seems that virtually nothing has been learned, and even less done in response to this longstanding critique. Why? As a contribution to everyone’s summertime reading, I have decided to re-release the original, complete and unabridged, in five easy pieces. With apologies for the curious formatting, I would very much welcome reader commentary.
Globalization, national affiliation, and sovereignty
Corporations are growing increasingly cosmopolitan and sophisticated, able to respond to
challenges and exercise influence with subtlety and nuance. Circumstances may still dictate the
occasional hiring of mercenaries or subverting of governments, but most days corporate power is
more effectively wielded through local consultants or sympathetic national or international
The received wisdom is that corporations have become stateless, and in general the location of a
company’s head office is increasingly incidental to corporate priorities and objectives. The
internationalization of production, in combination with the lure of tax avoidance, has largely
brought an end to corporate affiliation with countries of origin – except, perhaps, when foreign
assets are threatened or when it suits marketing objectives. United States flag patches, for
example, have again become a popular ornament on denim apparel – much of it made in Indonesia
or China or Bangladesh.
For the most part, major corporations raise capital in international financial centres, do their
design work in nodes of creative expertise, assemble where labour market conditions suit, pollute
where regulations or enforcement are weak, market where demand is strong, and so forth. With
the exception of demands related to trade policy negotiations and the control and policing of
intellectual property rights, it is in the interest of multinational corporate managers to retain at
most an arm’s-length association with host governments. No sinister plots here, just rational
responses to objective conditions.
The global negotiating agenda over recent years has been good for business. Dreams of the North-
South dialogue and a new international economic order have receded into distant memory and in
their place stand the WTO, Asia-Pacific Economic Co-operation (APEC), and a host of regional
trade liberalization agreements. Successive rounds of trade talks have brought widening agreement
on basic principles intended to facilitate competition, while protectionism has acquired a bad
In such areas as terms of entry, access to technology and intermediate goods, and the treatment of
investment capital and remittances, most barriers are down. The Multilateral Agreement on
Investment (MAI) promises to level the international economic playing field yet further – for
certain types of players. When differences do arise, reference can usually be made to one or
another of the dispute settlement mechanisms that are standard features in most trade
agreements. But these tribunals tend to meet behind closed doors, and neither their
responsiveness to the public interest nor their accountability is well established.