Globalization Needs an Upgraded Operating System
New technologies, climate change, rising social tensions, and geopolitical fragmentation have pushed globalization into a new phase for which the international community is woefully ill-prepared. Meeting these challenges will require a collective effort no less ambitious than that at the end of World War II.
GENEVA – The G20 Leaders’ Summit in London on April 2, 2009, is widely regarded as one of the best examples of global cooperation in a generation. Meeting as a group for only the second time, leaders of the world’s top economies, accounting for some 85% of global GDP, agreed to provide $5 trillion in fiscal stimulus and $1 trillion in additional resources to the International Monetary Fund, and to implement a wide-ranging program of financial regulatory reform. Coming on the heels of the 2008 financial crisis, the summit was instrumental in restoring confidence in capital markets and bringing the global economy out of its freefall.
The 2008 crisis showed that the international community had been far too complacent about adapting financial governance to the effects of new technologies and changing market and macroeconomic conditions. A decade later, we find ourselves in a similar situation. The Fourth Industrial Revolution is challenging the way we organize our economies and societies, as well as cooperate internationally. To maximize the benefits and mitigate the risks of the latest technological advances, we will need to strengthen and modernize national and global policy frameworks.
The current wave of technological disruption is combining with three other epochal transformations: the emergence of new ecological imperatives, particularly those concerning climate change; the advent of a multipolar world order; and an explosion of social discontent, fueled largely by rising inequality. Taken together, these developments represent a new phase of globalization – Globalization 4.0 – the trajectory of which will depend on how we adapt political, corporate, and international governance models to changing realities.