Serbia in the Shadow of the New World Economic Order Cover Image

Србија у сенци новог светског економског поретка
Serbia in the Shadow of the New World Economic Order

Author(s): Snežana Grk
Subject(s): Supranational / Global Economy, Government/Political systems, International relations/trade, Economic development, EU-Accession / EU-DEvelopment
Published by: Институт за политичке студије
Keywords: integration process; structural inequalities of the global economy; new world order; United States of America – European Union (US- EU); BRICs (Brazil; Russia; India; China; South Africa);

Summary/Abstract: Each society is a complex organism in which economy plays an important role. It is the bloodstream that makes life possible; however, there are other vital parameters that affect the quality and sustainability of any community, such as citizen satisfaction, their sense of existential security in a society. What is common to both life and economy are the cyclical rises and declines, which are sometimes so big that they represent a wake- up call. Since economic and life cycles need not coincide in time, generations that do not live up to see the rise, but only the decline, suffer and bear the burden of the hardships – where money is the only measure of value. Money allows for the power to be concentrated in the hands of a handful of people who possess enormously much. And there are more and more people who have very little. Financial power, viewed through the prism of wealth and real estate – is gradually being passed down from many private hands to a small, rich elite. This leads to the emergence of a large number of unfree people, financially and existentially dependent on the rich minority. Great structural inequalities of the global economy have led to a deep gap between the rich and the too poor. This growing divide between the haves and the have nots is the gravest danger of economic growth. The crisis is used as an excuse for the concentration of power in the hands of the dominant class. The cause of the crisis is greedy capital. In the conditions of crisis, all the depravities of the modern economy, manifested through the savings measures forced on by the Troika (the European Commission, the European Central bank and the International Monetary Fund), as well as the majority of governments in countries across Europe, are fully expressed. Pleading for savings measures is completely wrong – because savings will not encourage economic growth and the opening of new jobs. The short- term goal of the European Commission, the European Central bank and the International Monetary Fund is to destroy the social state. Rational state governance requires finding the true measure of reform sustainability. This means that reforms, even the inevitable painful cuts that follow in their path, should be combined with social measures that will enable even the mostly aggravated groups to maintain a mini- mum of security and confidence in the society. Responsibility always lies on those who have the power and run the state. An incapable and incompetent government pushes a state into chaos and despair. From the present viewpoint, we can see such economic systems at work that cannot survive in the long term. There is a threat of even deeper divides between economically weak countries, where hundreds of millions of people will be living in poverty, and economically strong countries. We are witnesses to different processes taking place in both the West and the East. Namely, America, Europe, and Asia are in the same life cycle. Only with opposite amplitudes. In the West we see the birth of new financial serfs. In the United States of America, it is individuals who are experiencing financial problems. In Europe, we have countries going bankrupt that are in problems Within the European Union, without a financial there is no personal nor political independence. There is an opposite process in the Far East, where there is an increasing number of ordinary people, individuals who possess more than before. Actually, not much more, but enough to become economically independent. Economic independence enables them to take control of their own lives, i.e. their future. Economic independence is the key path leading to political independence. There is a new architecture of world order at work. It is about the weighing out of power among the major economic forces, and about the new world economic order. On the one hand there are America and Europe, and on the other China and Russia, more precisely, the BRICs countries (Brazil, Russia, India, China, South Africa). Global economic growth is increasingly more dependent on the BRICs countries, who constitute 45 percent of the world labour force and who make up for 27 percent of the total purchasing power in the world. The BRICs are dreaming of a new world which their respective member states are trying to build, most probably without the West. America is more important to their interests from other growing powers, though. The US and Europe are taking over an important role in implementing the structural transition. The start of negotiations about the trade agreement between the US and EU is being announced. In America, this deal has already been called “the transatlantic trade and investment partnership”. The goal is to enable an incentive to international trade and investments through a common US-EU market. By trade expansion the American and the European sides will make up for lost jobs, whose loss was brought about by the financial and economic crisis. The creation of a common market will be a further incentive to the prosperity of the US and the EU. America and Europe will jointly be more competitive to the BRICs countries. In the power balance of major economic players on the geoeconomic scene, the biggest economic power in the world will still be “Euro-America”. In spite of the fact that Europe is still threatened by recession due to unemployment. In the shadow of the new architecture of the world economic order we find Serbia. A strange set of circumstances in the past few decades has led to the fact that Serbia knows neither what it wants nor where it is going. All attempts at any true change in the economy and the society have met with difficulty. The biggest hindrance to the country’s development are unstable macroeconomic balances, bribery, and corruption, a half- hidden reign of oligarchy and money, compromises and strange coalitions. The biggest peace project in Serbia so far has already predetermined its direction. It is only a matter of time when Serbia will reach its goal, i.e. enter the European Union. Yet, the hindrances on this road are big and painful, both for the country and its people. There is an overall impression that all ideas on how to balance the life and economic cycle have been exhausted. The economic situation in Serbia is highly alarming. The most competitive force in Serbia is corruption. The divide between the so- called elite and the poor is growing. People are disappointed in the political and business elite, i.e. in the tycoons who have through privatisation grabbed most of the wealth for themselves. Serbia must become the country of the people, if it has any intention of moving forward. Economic ideas which are constantly being promoted by incompetent individuals lead to a sure economic and social chaos. Political ideas promoted by the current authorities in the country in an attempt to win over both the West and the East are “rocking” Serbia, which is now “dancing” a little to the right, and a little to the left. It wants to turn to Europe, as well as to Russia. Which world economic coordinates Serbia will truly stick to – remains yet to be seen.

  • Issue Year: 2013
  • Issue No: 3
  • Page Range: 77-100
  • Page Count: 24
  • Language: Serbian