The New International Economic Disorder And Convergence

This article describes the difference between the way convergence was supposed to happen and how it is actually happening. The West, and its multilateral development agencies, was supposed to help poor countries close the economic gap that existed between the West and emerging market economies. The emerging market economies were forced to figure it out by themselves. They responded to financial crises by exporting their way out of debt. They became the creditor nations and the West became the debtor nations. We have convergence but it did not happen in accordance with Western policy prescriptions. We now see Western nations appealing to emerging market countries for financial assistance.

We have a scarcity of international leadership today. The West is floundering in its efforts to restore fiscal balance. The methods that were imposed on emerging market countries are now being imposed on Western nations and they are not working. To address the scarcity of leadership, it is argued that we need to make the emerging economy nations full partners in international organizations.