Small Countries’ Big Successes

ZURICH – Scotland’s vote on independence from the United Kingdom has spurred widespread debate about the secession of small states, such as Slovenia and Croatia in 1991, or the independence drive today in Spain’s autonomous region of Catalonia. But the narrow focus on the political and economic implications for Scotland and the UK – or, for that matter, the referendum’s decisive pro-union outcome – should not overshadow one of the more overlooked geopolitical trends of our time: the rise of small countries.

Roughly 75% of today’s small countries were formed in the last 70 years, mostly as a result of broader democratic transitions and in tandem with trade growth and globalization. Their successes and failures are more germane to current discussions than, say, the fiscal implications of Scottish independence.

The lessons to be learned from these cases are useful not only to new and potentially new small countries. Relatively young small countries in Africa, the Caribbean, and the Middle East can also benefit by examining the secrets of Singapore’s success, the causes and effects of Ireland’s property bubble, and Denmark’s decision to build strong counter-terrorism capabilities, despite its relative safety. Indeed, such considerations can help them to chart a path to economic prosperity and social cohesion.

Of course, in learning from one another, countries must always be careful to avoid the “folly of imitation.” The Nordic countries, for example, have benefited significantly from deeply entrenched social, legal, and political characteristics that are not easy to transfer to their developing-country counterparts.