Expect America, Europe To Matter Less In 2019
Since India may become the world's most populous country and biggest economy by mid-century, this one is a dark horse candidate for the most important issue of the year.
As 2018 comes to a close, attention is turning to what is likely to happen in 2019. I have no idea. But if you follow these questions, you will have your finger on the pulse of the world to come:
What will happen with Chinese civil society?
Five to 10 years ago, China had a proliferating and diverse group of non-profit groups, think tanks and cooperative civil society institutions, such as charities and clubs. They never stood on a firm legal foundation, but in the last few years they have been subject to a severe crackdown, including shutdowns, discouragements from the state, and much greater surveillance. Yet this social space cannot remain empty. Either the earlier growth will resume, boosting prospects for Chinese liberalization, or Chinese society will fall back under much more state control. This is my No. 1 issue for the year to come, and so far I am pessimistic.
Will China succeed in extending its political influence to the West with One Belt, One Road?
China is attempting what is the world’s most ambitious plan, namely to transform the economic and political order on its western flank, ranging as far as Africa. But China to date has not done a great job cultivating true allies (Pakistan? North Korea? Cambodia?), and already a backlash is settling in against Chinese influence. Will China succeed in helping to develop this part of the world and also bringing it into the Chinese sphere of influence? I say yes and no, respectively.
Will Ethiopia serve as a viable model for African development?
The country has been growing at about 10 percent for a decade, and it is spending more on infrastructure and receiving more foreign investment in its manufacturing capacity. Ethiopia now also has a charismatic prime minister, Abiy Ahmed, and under his leadership the country has deregulated its internet (formerly banned outside the capital), made peace with Eritrea, instituted market-oriented reforms, and moved to sell off parts of its government-owned companies. A lot of pieces are moving in the right direction, and maybe Ethiopia has a chance to move up to middle-income status over time, perhaps paving the way for other sub-Saharan economies.
I’ve visited twice in the last year, and I’m optimistic on this one, but the end of the story isn’t written yet. A wild card is that liberalization could cause further ethnic tensions to flare up throughout the country. With more than 100 million people, Ethiopia is Africa’s second most populous country, so a lot is at stake, including geopolitical stability in the Horn of Africa.
You may have noticed already that these lead issues do not much involve the U.S. or Europe. Next up is more from Africa:
Nigeria has incredible energy and talent, but it still has poor governance and rampant corruption. Can that combination drive significant economic growth?
The country has recovered from the recession of last year, but still hasn’t consistently stayed above 2 percent growth since then. So file this one under “remains to be seen.” Nigeria, of course, has both the largest population and economy in Africa.
How will India’s intellectual space evolve?
Many Western outsiders used to root for a particular Indian brand of Anglo liberalism to assume increasing importance in the political and intellectual life of India. While this has always been a minority viewpoint, it has had prominent representatives, including Ramachandra Guha, who just published a major biography of Gandhi. But these days, this perspective is dwindling in influence, as is old-style Bengali Marxism and other ideas from the left. It’s not just Hindu nationalism on the rise, rather India seems to be evolving intellectually in a multiplicity of directions, few of them familiar to most Americans. In India, history ain’t over, and further ideological fragmentation seems to be the safest prediction. Note that ideas are very often a leading indicator for where a nation ends up.
Since India may become the world’s most populous country and biggest economy by mid-century, this one is a dark horse candidate for the most important issue of the year.
How about some issues overrated in terms of immediate import?
I don’t think Crispr is ready to pose major moral dilemmas just yet, driverless trucks are likely to arrive before driverless cars, and America’s political checks and balances seem to be holding up.
And if you want some outright predictions for closer to (my) home, here are a few: Some version of Theresa May’s Brexit plan will pass. President Donald Trump will remain in office though tarnished all the more. The Golden State Warriors will win another NBA championship. And finally: Stock prices will go up, and down, and then maybe up again. Just don’t say you heard it here.
Cowen is a Bloomberg Opinion columnist. He is a professor of economics at George Mason University and writes for the blog Marginal Revolution. His books include “The Complacent Class: The Self-Defeating Quest for the American Dream.”
(c) 2018, Bloomberg Opinion