Prelims level : International Institutions Mains level : GS-II Important International Institutions, Agencies and fora- their Structure, Mandate.
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Why in News?

  • The World Economic Forum (WEF), a platform for world leader, professionals, senior government ministerial delegations, was held at Davos recently. This Forum has majorly discussed about a “New World Order”.

Why there is discussion on new world order?

1. Social inequalities and stark and Continuing Poverty:

  • The latest Oxfam Report presented at Davos points out that 2,153 billionaires have more wealth than 4.6 billion people.
  • [The 2019 report titled “Public good or Private Wealth?” showed that India’s top 1% holds 51.53% of the wealth].

2. Un-tenability of Capitalism as a Concept:

  • The ugliest face of the capitalism was visible during the 2007-2008 economic crisis, first in the U.S. and thereafter across the European Union. At that time, it appeared as if the global economy was on the verge of collapse.

3. ‘Energy Imperialism’

  • The developed countries are of the strategy of imperialism across continents, in order to capture energy – generating resources to push their GDP.

4. Toxic colonialism

  • Egregious consumption of energy by the developed world has resulted in disposal of ‘e-waste’ in many African and Asian countries.

5. Unsustainable energy consumption

  • Developed world, and China, are ferociously using up finite raw materials without care or concern for the welfare of present and future generations.

6. Unequal distribution of the ‘fruits of globalisation’

  • Intellectual Property Rights are highly favouring the Rich Nations.
  • Most transactions are based on the arbitrage between price and value difference, from which only the ‘middleman’ gains, not the primary producer.
  • Carbon credit system – mechanism is also in favour of the wealthy countries. Under this, countries with high energy consumption trends can simply offset their consumption patterns by purchasing carbon credits, the un-utilized carbon footprint, from poor developing countries.

Nordic Economic Model – a model to Emulate:

  • There have been remarkable achievements of the Scandinavian countries comprising – Denmark, Finland, Iceland, Sweden, Norway, and allied territories. These nations are among the richest in the world when measured in terms of GDP per capita. Nordic countries also tops in the Global Happiness Index.

Important feature of their Development Model:

  • Large public sector enterprises
  • Universal welfare systems
  • Excellence in public service
  • High levels of taxation
  • High rates of Personal and corporate income tax rates.

Ingredients of the New ‘Enlightened Global Order’

  • Taking the Nordic model as a template, there are some ingredients that could be part of a new ‘enlightened global order’. These should include —
    • Effective welfare safety nets for all
    • Corruption-free governance
    • A fundamental right to tuition-free education, including higher education
    • A fundamental right to good medical care
    • Higher taxes on rich and shutting of tax havens
    • Corporates must work not only for Profit – but must be guided by 4P’s – Profit, People, Planet and Process.
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