After the flabbergasting American election results, the status quo which has presided over the world will change.
This is what voters’ choice in the elections has called for. When the new President of the US takes his seat in the White House in January 2017, it will become clearer how realistically he will translate his voters’ frustrations into action as this will have repercussions not only for the target countries. It may also shrink America, if mismanaged. It’s a double-edged sword.
Financial markets in parts of the world other than America have already gone into a tailspin after the election results were announced. Stock markets from Tokyo to Australia, going through Shanghai and Mumbai have gone into negative territory, casting doubts on whether corporate performances will be sustained. Market gyrations in the wake of elections are normal but an element of fear of the future already clouds global markets.
Whether the global situation stabilises or otherwise will decide the future of trade-dependent economies such as Mauritius. This is because America is a centre point in the global economy, especially as the global economy has not yet recovered from the slump of 2007-08. If the US were to narrow down its interface with other countries perceived to be taking away its domestic economic scope, then those other countries (Europe, Africa, the Far East) will take a defensive approach pertaining to their own trade arrangements, negatively impacting their current trade partners.
As a small island economy, we don’t have too many degrees of freedom to seek out alternative economic moorings were our established trade links to show signs of wearing out at some point or other. We are at the receiving end. It will be even tougher for us if existing specific negotiated trade and other arrangements such as the African Growth and Opportunity Act (AGOA) with America were to suffer as a result of US policy reviews.
We must therefore pray and hope that administrators who will be appointed to back the new President in the policy field will do all they can not to usher the world – and countries like Mauritius along – into a global economic depression by sharply kicking into reverse the process of globalisation. In case retaliatory measures were to be adopted by targeted countries, the elephants engaging in the fray will also crush the grass underneath their feet. Countries like Mauritius would thus suffer collateral damage.
On the other hand, were America, driven by corporate instincts to engage – rather than snap trade ties unilaterally — on altered acceptable terms with the rest of the world, the existing global order may still be saved for the benefit of all. That may reduce the appetite of customary rent-seeking global multinational economies without tearing apart the fabric holding together all economies of the world, large and small. This is where we stand a chance to do well, especially if we happen to add much more to the scope of the economy.
For the moment, the world stands on the threshold of an eerily unpredictable period in international relations. This uncertainty will have the effect of keeping on hold new economic initiatives in places such as Mauritius the longer it lasts. One can therefore look forward to positive signals from the President-elect in the meantime to the effect that he will do all he can to support us in our positive endeavours, including seeking clarity from our friends of the UK about the future of the Chagos Archipelago, one of the islands of which hosts US forces and which we are not minded to displace.
The overall global situation looks tense for now, given the stoutly assertive mandate US voters gave in the elections of 8th November. The best hopes for Mauritius and the world lay in how skilfully and un-disruptively the new President will address voters’ economic and social vindications. Were he to deal more deftly than the whole world expects in the matter, President Trump might emerge as a successful redeemer of his social pledge (and perhaps gaining a second term as well) and not as the feared iconoclast he has appeared to be during the campaign. His job is to deal skilfully with a dominant status quo which has failed to deliver sustainable hopes for the future, not only in America but across the whole world.