Global Trends by Martin Khor

02 January 2006

What lies ahead in 2006?

More violence in Iraq, continuing US unilateralism and a weaker United Nations, terror from individuals and states, continuing Asian growth but a threat of world financial instability, more natural disasters, and a question mark over avian flu – these are some likely developments in the new year.


When the new Millennium dawned six years ago, it was difficult to predict, amidst the euphoria, what kind of world we would be living in.  Would there be the same old trends, with power and might dominating?  Or something new -- where justice becomes the bedrock on which development and peace are built?

Six years on, the new century, if not the Millennium, is settling down. It looks as if the old trends are continuing, with new twists that are giving rise to new turns.

September 11 was of course the landmark, and equally so the “War on Terror” of the Bush administration launched in response.  The war against the Taliban in Afghanistan was a direct response to 9/11.  But Bush also made use of the climate engendered by 9/11 to invade and occupy Iraq.  

Unilateralism soon became the streak of recent years, with the US vowing to launch pre-emptive strikes (without United Nations permission) to uphold national security.  Last year, US prestige fell further with more revelations of abuse of prisoners, abduction of “terror suspects” in any country and transferring them to detention centers in other countries, and “rendition” of detainees to other countries for interrogation and torture.

As 2006 begins, the world is facing two types of terror – the attacks from suicide bombers in many parts of the world, with massive loss of lives and property, and the attacks from states, whether the US in Iraq, or Israel in the Palestinian territories, or violence committed by governments against its own civilians in all the continents. 

The new year will see major developments in Iraq.  If the Iraqi resistance against foreign occupation continues, it is likely that the US and United Kingdom will take more decisive steps to increasingly withdraw their troops.

The fierceness of that resistance, not predicted even two years ago, has reduced the US appetite for more “pre-emptive strikes” elsewhere.  But the danger of unilateral action still lurks. 

In 2006, the US will intensify its political pressure on perceived enemies such as Iran and Syria.  We will have to see whether these will escalate into something more physical or even military.

In 2005, Bush’s domestic popularity fell sharply, due to local issues like the mishandling of Hurricane Katrina, and to the growing unpopularity of the Iraq war as more American soldiers were killed or injured.  In 2006, the US President will have to work hard to prevent his popularity from plummeting further.

That won’t stop the US administration from continuing to put the screws on the UN.  Last year it almost scuttled the UN’s World Summit, then turned it into a tame affair that did not have impact either on reshaping the Security Council nor strengthening its development role.

As the new year begins, the UN faces a threat to its budget, while the US is demanding yet another UN administration reform, which many fear will render the organization even more toothless.

As this is the embattled Kofi Annan’s last year in office, the new year will see jostling for his succession, with Thai and Sri Lankan candidates the early contenders.

However, the world is no longer run only from Washington or Brussels (where the European Commission is located).  The new year will likely see the continuing emergence of Asia, which will still be fastest growing region.

China will lead the charge with its astonishing economic expansion, and India will follow just a few percentage points lower.  And South East Asia, the old leader in the growth stakes, will continue its steady and moderate growth.   

This assumes there won’t be a global financial crisis or a big Western recession.  At present, most of the analysts are optimistic that there will be modest global growth and no major mishaps. 

However, other experts predict that the recent danger points – imbalances among major countries, huge budget and trade deficits in the US, currency instability – will finally culminate in a global crisis of some kind this year.  “The chickens will eventually come home to roost, and it will happen in 2006,” so goes this hypothesis.

The truth is that no one can predict with any certainty what will happen to the global economy, or even just the US dollar.

On the trade front, the World Trade Organisation will continue its struggle to complete the present Round.  The Ministerial conference in Hong Kong last month just avoided a major failure.  The new deadline for completing the “modalities” for agriculture and industrial products was shifted to the end of April 2006, so that the whole agreement can be completed by December.

Many analysts say the issues are too complex and the positions of major players are too far apart for such a convergence to take place by April.  If the deadline is not met, the talks may linger for years.

Health and environment issues will have their fair share of the big news in 2006. Last year saw a rising concern now verging on hysteria about avian flu.  The number of cases are still small but the health experts are predicting an “inevitable” pandemic that may affect many millions.

Most closely monitored in 2006 will be whether the avian flu microbe mutates to a form that enables human-to-human transmission, in which case a pandemic will be imminent.

On the environment, more disasters can be expected.  2005 was the year of terrible events – the after effects of the tsunami, the haze over Malaysia, several earthquakes, hurricanes in the Americas, the toxic spill in China.  

There will be a continuing fight to get both the public and policy makers to take climate change seriously.  In 2005, there were cheers – more of relief than of celebration -- just because of a decision to refresh the Kyoto Protocol.

While the fate of the world still rests mostly on the decisions of the big powers, it is also up to the developing countries to put their own houses in order and to play a more effective role in international affairs.  

In Latin America, the winds of change are strongly blowing, with changes in regimes and policies in a growing number of countries. 

Asia will continue the search for a suitable regional framework within which both growth and political stability can be articulated.  The East Asian Summit last month, with all its limitations, made a start.  Will the flame of regionalism be nurtured further this year?

In Africa, there will be efforts, by civil society if not by governments, to break the cycle of debt, poor commodity prices, and national socio-economic inequities.

The struggles for a better life will continue in 2006, but what will come out of these remains to be seen.