Economics: Have We Got It Wrong?
This presentation was given as part of the BNZ Business Seminar Series organised by the School of Business , University of Otago 10 August 2010.
The background was set by an explanation that all international commerce could be traced back to King Henry VIII. He then traced the history of economic development from then to the present (as a brief overview). White suggests that we should take a macro look at the history of economics and economic development and not just take an arbitrary date that will support the current thinking.
White went on to discuss the Trade Aid charter explaining the three areas of partnership, change and sustainability.
“Globalization is very poor at growing wealth” and “free trade has not delivered growth, stability and equality”.
“I don’t want nice words, I want an order” White quotes a Bangladeshi women after he gave a presentation on trade in a town in Bangladesh.
“The status quo is not good enough for 80 percent of the world”
“The future of the fair trade movement is in the domestic market”. This is in the producing countries overseas and in New Zealand. With the decline of globalization, small and medium enterprises are ideally suited to service the domestic market that they are based in, e.g. local seasonal food produced for a local market.
To measure the impact of fair trade we need to make sure that success is measured in the eyes of the community that is being assessed and not imposing a “western” standard that would be unobtainable. “An iron shed is luxury compared to a mud hut” yet to a first world economy observer it would be still an iron shed. Mediocrity to one person is excellence to another. It is not for us to judge the other, especially if we do not know all of the circumstances of the other.
Are free trade agreements always good? Often the free trade agreements can include “hooks” that could affect, not just business but may impose a colonial style approach to education, health, and welfare. Each agreement needs to be looked at not just from an economic perspective but from a holistic societal and sovereign view. Is short-term gain ever worth long-term loss? Some doubt and suspicion is required to ensure that own interests are protected, this includes the sale of land to overseas interests.
A further question to be asked is: Sustainable for who? Are all parties to any trade being treated in a way that is beneficial for all?
Overall this was an excellent presentation and the fact that the audience was left with questions will help in applying due diligence to all trade practices.