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Is Globalization reversing?: A new approach

 

Is globalization over? Are there alternatives to protectionism to create and protect jobs? The answer is yes: and they are currently in practice right on the US-Mexico border. Let's take a look at what the Performance Improvement Institute started in the Arizona-Sonora megarregion.

 

After Brexit, the rise of Donald Trump and the string of anti-globalist, populist and protectionist movements and candidates in all Western Europe, the views and prospects about globalization have made a 180 degrees turn, from the elegiac futurizations of Tom Friedman's books to the apocaliptic prophecies of anti-immigration and anti-free trade proponents.

 

Panjat Ghemawat proposes an intermediate way in his Globalization 3.0 model.

 

According to him, realistic approaches to globalization must consider that a total reversal  -what he calls the "1.0" approach- to complete closed economies is as unrealistic as complete and unrestricted free trade and a borderless "flattened" world (what Ghemawat calls Globalization 2.0").

 

Reality might fall somewhere in between, according to Ghemawat, in some combination of trade and exchange that promote growth and rules that prevent massive trade imbalances and cause mass migrations and international conflicts.

 

 

One real-world, practical example of the "3.0"approach proposed by Ghemawat was implemented by the Performance Improvement Institute (PII) in the Arizona-Sonora region,PII supports ntegrated ecosystems that make borders work in "win-win" combinations. Subregional agreements at the city, county and state level such as those implemented in thge "Ari-Son" case, allow integrated growth under a shared framework.

 

 

The Performance Improvement Institute helped create 34 new startups and more than 9,500 direct and indirect jobs in the Southern Sonora region. PII created an integrated ecosystem that combined diferent strategic areas of economic and social impact such as agribusiness, ecotourism, real estate and IT that attracted foreign investors (FDI) and complementing the economies of Arizona and Sonora through direct partnesthips between universties and local and state governments. 

 

That is what communist China did with its Special Economic Zones, which allowed the spectacular rise of standards of living since its inception in 1979, by adopting the Hong Kong model in other 17 "sister cities" that gave access to free markets to entrepreneurial chinese companies. 

 

 

Shenzen and Hong Kong work as an integrated ecosystem bridging two economic systems suposedly antagonistic into mutually beneficial partnerships.

 

A border is actually a natural ecosystem that can be organized in mutual benefit for neighboring states, cities or countries. 

 

 

 

 

 

 

 

 

 

 

The first of Ghemawat's "laws of globalization" is precisely that of geographic proximity. Trade works better among neighboring partners, if they can manage their cultural and systemic integration.

 

 

 

 

 

 

 

 

 

 

 

 

 

Borders can be thought as levers of growth instead of sources of conflict.

 

A recent article by  James Ramey and Homero Ardjls       proposes an interesting alternative to a conflictive initiative: the US-Mexico border wall: making the wall a source of energy by installing solar panels along the border.

 

That initiative would help combine secure borders with economic growth -the most durable way to make security last-. Ideas such as this show the way we think ecosystems at the Performance Improvement Institute (PII)

Largest solar panel plant in Arizona

 

There are already pioneer products in the market, such as Tesla's "solar wall", thought mostly for home use at a starting price of USD 3,000. 

 

 A solar border wall would involve, of course, a different scale of investment, but also of economies. Just another example of ecosystems thinking in practice.

 

 

 

Wall Street Journal echoed our idea a month later in an article published by Vassily Fthenakis, director of the Center for Life Cycle Analysis at Columbia University and Ken Zweibel, director of the Solar Institute at George Washington University. (read a summary)

 

 

Contact us to learn more about it!

 

 

 

 

 

 

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