How Covid-19 Is Reshaping the Global South

Walden Bello

The spread of Covid-19 across the world was facilitated by a globalised economy rigged in favour of big corporations – and the long-term consequences are likely to fall most severely on those it exploits: the countries of the Global South.

Interview by
Ben Wray

On 8 January 2020, the WHO confirmed that the infection of at least 59 people in the city of Wuhan was a new strain of Coronavirus. One year and 1.9 million deaths later, nowhere has been untouched by what has become the worst global pandemic since the 1918 Spanish Flu.

While the West has largely been preoccupied with itself, the Covid-19 crisis has been truly global. The pandemic has overlapped with the pre-existing inequities of global capitalism, where the brunt of the pain always falls on those with least.

In Saudi-bombarded Yemen, for instance, where malnutrition is rampant, Covid-19 fatality rates are five times higher than the global average. Across much of Latin America and Africa, countries spending more on debt repayments to the West than on their healthcare budgets are fighting Covid-19 with one hand tied behind their back. In the race for vaccines, a proposal by nearly 100 countries in the Global South for a general waiver on the patents and IP rights of all vaccines has been rejected by wealthy countries seeking to protect their own Big Pharma giants.

None of this comes as a surprise to Walden Bello, who has been a world-renowned critic of globalisation for over four decades, authoring more than 20 books in that time. Bello, who was a member of the Philippines House of Representatives from 2009 to 2015, is co-founder of Focus on the Global South, and was described by Naomi Klein as ‘the world’s leading no-nonsense revolutionary.’

He is is currently a professor of sociology at the State University of New York at Binghamton, and senior research fellow at the Center for Southeast Asian Studies of Kyoto University in Japan. His most recent books are Paper Dragons: China and the Next Crash (2019) and Counter-Revolution: The Global Rise of the Far-Right (2019).

In this interview, journalist Ben Wray speaks to Bello about the contours of the twin health and economic crisis which has shaken global capitalism over the past year, the political ramifications, and what the prospects are for a post-capitalist alternative to emerge.


BW

To what degree is globalisation culpable for the pandemic?

WB

I think it’s fair to say that the structure of the global economy made the fast spread of the virus possible. When Donald Trump came to power in the United States he was espousing anti-globalisation rhetoric and advocating ‘America First’. The champion of globalisation was turning its back on globalisation. But at that point another phase of globalisation, led by China, emerged, called ‘connectivity’ – actual economic integration of the global economy through various mediums. China promoted this next stage of globalisation, especially through ‘the Belt and Road Initiative’, linking the Eurasian land mass together.

One of the elements of increased connectivity, air connectivity, has really grown enormously, and China is a huge market in that sense, especially in terms of the number of tourists coming from there. It’s that very intensive connectivity which became the mechanism for the very rapid transmission of the virus.

We must also bear in mind that the destruction of the natural environment was creating this interface between human communities and wildlife which was one of the major factors leading to the genesis of the virus in the Wuhan seafood market. So the combination of destruction of the natural environment and expansion of connectivity—key aspects of globalisation—facilitated the spread of Covid-19.

Having said that, I’m not engaged in a blame game. Despite the missteps in China at first, in the end they took steps to stamp out the virus locally, and to some extent they succeeded. Other Asian countries, like Thailand, Taiwan, and Vietnam, also took the threat of Covid-19 seriously and were able to control the spread of the virus. Countries in the West in particular had a chance to get a handle on this early on and did not do so.

BW

You have written about how the global economy has been designed around the needs of transnational corporations, with supply chains spanning all over the world and many countries overly-specialised in some sectors while under-resourced in others, including essential goods like food. When the pandemic shut borders and trade routes, what vulnerabilities did it expose in globalisation?

WB

The economic consequences are where we begin to see the big problems that have been created by globalisation. Early on we saw that practically the whole of the Chinese economy shutdown, and many countries had sourced so many of their industrial supplies in China, so you had a situation of real fragility for economies across the world. Even mainstream economists and technocrats were saying ‘maybe this has gone too far’. The German minister of economic affairs, Peter Altmaier, said that when it came to supplies of medicine it was very important to re-localise many of the country’s industrial facilities.

The problems with global food supply chains, where so many emerging economies and rich countries have become so dependent on global supply chains and air and sea transportation, were exposed when the pandemic hit and supply bottlenecks emerged. It made so many countries realise the folly of relying on global supply chains controlled by a few corporations for their supplies. At the same time, they couldn’t make the transition immediately to re-localising, because a lot of the local supply chains had completely withered away.

There’s also a heavy dependence on migrant labour in agriculture in Europe and the US, so when border controls went up to deal with the virus, the workforce to manage the planting and harvesting was suddenly whittled down. There was a sense that this big plantation farming dependent on supply chains thousands of miles long, that this had become a mode of production in agriculture that was very fragile.

So I think in both industry and agriculture, in the North and the South, there was a sense of going too far in sourcing supplies of food and industrial components in far-away places. Those were some of the initial realisations that took place. Whether that means re-localisation is going to be a sustained effort is a big question mark at this point in time. The focus of the crisis at the moment is still in the stage of trying to manage the pandemic and on emergency fiscal measures to boost spending.

BW

For many countries in the Global South, the pandemic was their first recession in decades, and has led to already unsustainable sovereign debt obligations to largely Western states and Western dollar-denominated private creditors reaching crisis point.

WB

Clearly there are parts of the Global South that have been very hard hit by the pandemic crisis: South Asia, India, large parts of South East Asia, like the Philippines and Indonesia, and large parts of Latin America where it has been very bad, like Brazil, and parts of Africa, especially southern Africa.

A lot of countries were already in very severe problems of debt before the crisis, and they also had many problems of resources in terms of being able to respond the crisis, and they needed support. At the same time, there’s a lot of hesitation in the Global South about getting into more debt, whether it’s the IMF or the World Bank. There was a noticeable lack of trust, that they might be over-committing themselves, because the IMF and World Bank’s position has always been that the loans have to be repaid. And they saw what had happened in Europe, in countries like Greece during the financial crisis, and how the IMF was part of the Troika which imposed austerity measures. So they’ve been hesitant to go to multilateral institutions for loans. The IMF has set aside funds to support relief efforts in the Global South, as has the World Bank, but many countries have not taken advantage of those funds because of the conditions attached to it.

And of course the ability of countries in the Global South to have stimulus programmes is very limited because of their lack of resources, so you usually won’t see the same kind of stimulus programmes as in the Global North. So things have been bad in the Global South in terms of the ability to respond to the crisis.

At the same time I wouldn’t say that it has been worse than what has been happening in the Global North. By all indications, the massive economic impact that Europe and the US has received from the pandemic crisis has been just as bad if not worse than many countries in the Global South. Many countries in the Global North, like the US, have just not been able to get their act together. I think what has happened is that the pandemic has exposed the fragility of politics as well as the ineptness of democracies in the Global North.

BW

How has the pandemic crisis affected the rise of China?

WB

Before the virus hit, China had become the new centre of global capitalist accumulation. Over the last 20 years, when the US and Europe were financialised—meaning the dynamics of their economy rested pretty much on the financial sector—China, because it was able to build up a tremendous industrial capacity (incidentally, with the help of Western corporations) had become the centre of global capital accumulation. So even before the virus, the United States was responding to China in an aggressive way, but also in a self-defeating way – Trump was responding with a trade war which probably hit the US more negatively than China.

The virus initially seemed to stop China dead in its tracks. As we saw in the early months of 2020, the Chinese industrial machine almost ground to a halt. But beginning around mid-year, they were able to get control of the virus. The Chinese industrial machine began to pick up again. In the end China was one of the few countries to register positive growth in 2020.

So as long as the US and European countries fail to stop the pandemic while China has contained Covid-19, the dynamism of the Chinese economy will be accelerated and moving ahead of the West. However, we are in a truly globalised economy, and if the US and Europe really don’t recover, I don’t think that the consumer demand from the Global South can fill the gap of falling Western demand for China – so ultimately China needs Europe and the US to recover. But clearly the long-term trends favour the rise of China’s economy relative to the West.

BW

Other emerging economies, like India and Brazil, which are led by hard right-wing leaders, have struggled to cope with the pandemic. What has been the political fallout of the crisis in the Global South?

WB

Both Brazil and India have suffered a lot. In India, it’s said that the number of infections and deaths are under-counted, and I believe that. Government ineptitude, where in the first months of the pandemic they imposed this massive lockdown which forced workers from all over India to start walking to their homes, which became a major spreader of the pandemic. In many ways the pandemic has shown how inefficient the authoritarian BJP government is in meeting people’s needs, although its popularity in general remains strong. One bright spark has been that farmers have come out in huge numbers to protest against the anti-agricultural policies of the government, even in the middle of the pandemic.

In Brazil, you have a president who hasn’t taken the pandemic seriously, like Trump, but even before the outbreak Brazil was struggling economically. Bolsonaro continues to have a hold on some 30 percent of the population, apparently regardless of whatever he does; again a bit like Trump.

So these two countries are experiencing economic and political crises that China is not experiencing at this point in time. There is a sense spreading that this shows the superiority of the Chinese system of government, as opposed to the West. And of course this has been reinforced by what years ago would have been considered unimaginable goings on in the United States.

The basic structural dynamics remain as before: in terms of the global political economy and the new centre of accumulation, which is China; in terms of the financialisation of the world economy; and in terms of the rise of the far-right owing to the inability of social democrats to respond to the needs of workers. All of this is just intensified by the pandemic crisis.

BW

What effect will Joe Biden’s election as US President have on the Global South?

WB

I think Biden will find it very difficult to rule. Trump may have lost the election, but he’s also shown that he has created this formidable movement on the far-right, which every Republican politician is now scared of. And that force is going to stand in the way of Biden normalising the situation. So I think there will be four years of great instability in the US.

The second thing, foreign policy wise, is that when it comes to US alliances, such as the Atlantic alliance, which Trump damaged, those won’t be that easy to repair. Countries have now seen that the alliance with the US can be fragile.

In terms of China, I don’t think Biden will carry out a trade war, but he and the rest of the US establishment also see China as the main threat to the US, and for that reason they’ll be hard on the country.

And then in terms of positive moves from Trump, for instance in Korea – whatever his motives were, he ended the cold war in Korea. The Biden people are the defence establishment, and really regard North Korea as a renegade state that ought to be stopped. So I think the old cold war against North Korea will be reasserted.

The withdrawal from Afghanistan might be reversed, there might be a going back to the Iran Deal, but in any event it’s going to be a post-Trump world, and like humpty dumpy it might be very difficult to put it all back together again.

My sense is what the US is entering is a period where things might be less settled electorally, and more and more on the streets. The recent storming of the Capitol by thousands of Trump supporters underlines this trend. I think this isn’t an aberration: we’ll see more and more street warfare determining politics in the US rather than elections. We might have the modern equivalent of the 1920s Weimar Republic in the US.

BW

You have been making the case for a post-capitalist politics of ‘deglobalisation.’ The pandemic has clearly exposed vulnerabilities in globalisation, ones that climate breakdown is also exposing. Do you think the prospects for post-capitalism have improved in this context?

WB

On the one hand we’ve seen how the credibility of neoliberalism was tremendously harmed by the global financial crisis, which has now been followed by the pandemic crisis which came as the after-effects of the 2008 crisis were still being felt. So that’s a tremendous loss of credibility for capital.

In terms of ideas, I believe the ideas that have come from the progressive movement have been fantastic. A more radical social democracy; eco-socialism; food sovereignty; you have people-centred economic alternatives that have responded to financialisation, climate change, and gender inequalities. The problem is they haven’t gained traction.

I think part of the reason for that is that people associate those ideas with the social democrats, and it’s the social democrats’ embrace of neoliberalism that they remember, not the great ideas and proposals coming from the independent Left that criticised neoliberalism and globalisation in the first place. The social democrats were just as party to neoliberalism as Thatcher and Ronald Reagan. So I think that has spawned distrust of the Left as a a whole.

What the Right has done in its very opportunistic way is cherry-pick part of the Left’s arguments, through their attack on globalisation and defence of elements of the welfare state, but put them in a right-wing framing: ‘We are for the welfare state, but only for people from the right colour, the right culture, the right ethnic group’, etc. That, essentially, is what national socialism is all about.

So on the one hand you have neoliberal capitalism seen as less and less credible, you have the Left with a lot of fantastic ideas but little political traction, and you have the Right who have taken on some of those ideas and put them in a right-wing, nativist, racist framework. Whether in India or the US, that’s the movement which has traction.

It’s a period of radicalisation that we are coming into. In this period I think that the far-right is ahead of the Left in terms of gaining traction, but I would not count out the Left. The challenge is how to get that energy, which initially went to the Corbyn wing of the Labour party, or to Bernie Sanders, connected to a vision and a programme that can be competitive with the far-right? Sometimes the Left doesn’t quite connect with people’s gut instincts. How do we do that?

Despite the fact the far-right has advantages at this point, I’d be optimistic and say that history has a way of springing surprises. As long as we keep our heads and are willing to think outside the box, we will be able to forge an inspiring alternative.

You can hear more from Walden Bello on our A World to Win podcast.

About the Author

Walden Bello is a professor of sociology at State University of New York at Binghamton and a senior research fellow at the Center for Southeast Asian Studies of Kyoto University in Japan. His most recent books are Paper Dragons: China and the Next Crash (2019) and Counter-Revolution: The Global Rise of the Far-Right (2019).

About the Interviewer

Ben Wray is a freelance writer based in Scotland. He is a former editor of Common Space, for whom he now produces the newsletter Common A.M.