Policy Space for Developmental States in a Multipolar World: In Search of Social Reproduction and Economic Redistribution Marina Durano, DAWN WIDE Annual Conference 2009 Basel, Switzerland

World Growth Rate

Outline Double standards and power inequalities Politics of aid and limits of multilaterally- coordinated action Re-ordering towards a multi-polar world Expansion of policy space as implicit demand for sovereignty

Double Standards Fiscal Stimulus versus Fiscal Discipline Trade protectionism versus trade liberalization Liquidity expansion versus lack of access to financing or new debt obligations

On Fiscal Space Developed countries had the fiscal space to opt for a fiscal stimulus package when recession hit Developing countries are typically advised by Bretton Woods institutions to maintain conservative fiscal deficit targets, particularly during an economic crisis

On trade policy 78 Measures since the G20 Meeting in Washington, DC increase in tariffs (Russia, Ecuador) non-tariff measures (Argentina, Indonesia, India, China) “Green” policies, e.g. US subsidies to battery production in US-based factories

On liquidity G20 Leaders agreed to $250 billion SDR allocation but split according to equity shares In 1997, there was already an agreement for an SDR allocation but never fulfilled Additional resources to WB and IMF for re- lending-- raising the possibility of new debt obligations Searching for new sources of liquidity

Limits of multilateralism The politics of aid has set limits on multilaterally- coordinated action. WB-IMF-WTO are preferred by donors as centers of macroeconomic policy discussions and decision-making--”division of labor” The UN is seen as lacking capacity in this subject area.

A multi-polar world Large middle-income countries are creating new centers of power Brazil, China, India, South Africa, Russia(?) As “new” donors, leading trade negotiations, providing alternative currencies for international payments

Int’l Reserves $Bn2009 Growth %GDP $TnPublic Debt/GDP %External Debt/GDP % USA Canada UK Ger France Italy Japan G China Brazil Russia India Taiwan S. Korea Sing

Reproduction and Redistribution Political demands expressed as increased spending on issues that matter to feminists Alignments with heterodox/alternative policy proposals Expansion of policy space and fiscal space serves as the vehicle for feminist demands

On sovereignty Increased policy space is an implicit demand to secure sovereignty A reaction to the emasculation of state power through its “marketization” or conflict Nation-state remains the key political target: strengthening the state and regulating the market

Gender-equitable Public Policy Policy measures that create behavioural incentives so that there is a re-balancing of responsibilities for provisioning among social institutions (e.g. care diamond). Protect and promote in the global politico-economic order