Student # 102230

Introduction

World trade has increased since the 80s, as a result of the Globalization; many countries increased their
wealth because of this phenomenon.

Although the profits were not shared equally

Because of this, some states like The United States, Brazil, England, China and The Philippines, for
example, think that their economies were affected. Consequently, change their economic policy focused
on an economic nationalism to counteract this effect.

The origin of the Globalization

There is no exact date in which we can award the birth of globalization. The first steps towards this took
place at the conference in Bretton Woods, where all the allies, winners of the Second World War met to
establish a global monetary system.

On 27 December 1945, at Bretton Woods, Carroll, New Hampshire, United States was created the
International Monetary Fund and the World Bank

The IMF had the function of implementing and regulating an international monetary system. The United
States owned 2/3 of the world's gold. Consequently, the only currency that could be converted into gold
would be the US dollar.

This conversion made the US dollar accepted as standard in commercial transactions because it was the
only gold-backed currency and avoided complex transactions in different types of currency. Since 1944
to 1971 for every U$S 35 an oz. of gold is received, until August 15, 1971, when Richard Nixon
eliminated the convertibility between Gold and the dollar. Today is U$D 1230 per oz.

Another organization that contributes to globalization was the GATT (General Agreement on Tariffs and
Trade) created in 1947, which later gave rise to the WTO (World Trade Organization), on January 1,
1995.

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Additionally, the creation of different commercial blocks such as the European Union, NAFTA, Mercosur,
Andean Pact, African Union, Pacific Alliance, Association of the Southeast Asian Nations, Pacific Islands
Forum, promoting commercial preference among member countries, the customs union and the
creation of a common market.

Moreover, the birth of the Internet in 1969 and its exponential growth in the 90s as one of the
fundamental pillars of the Globalization

A milestone for the foundation of Globalization was the end of the Cold War, when the Soviet Union and
the communist bloc headed, whose failed experiment represented the decline of collectivism projects
closed societies and economies protected disappeared. Although the dissolution of the USSR occurred
on December 25, 1991, it is symbolized by the fall of the Berlin Wall on November 9, 1989.

The increase in trade and the decision of many companies to transfer the factors of production to
underdeveloped countries where labour was cheaper and contributes not only to reduce the costs of
the products but also increases the phenomenon of Globalization.

The beginning of the end?

Any expansive economic process at some point comes to an end, unless it is modified by another
process.

The dot com bubble, the subprime crisis in USA and European debt crisis were economics crisis process
that put at end speculative and the infinite growing without sustain.

In the political and social there was a before and after the attack 9/11, it was no longer necessary to
develop nuclear weapons to intimidate a people, a low budget attack put in check a country, a world
that would not return to be free and safe again. Attacks in the heart of developed countries by groups of
people dissatisfied with society, using the same technology (Internet, mobile phones, Facebook,
WhatsApp, etc.), that propels globalization, begins to destroy it.

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Left wing and populist parties lost positions

Social democracy and left-wing parties in Europe and left populism in Latin America have lost positions.

Economic crisis, loss of their national identities, corruption, they are some factors that could explain
what happened.

The capitalism reformulation and the creation of new economic world order didn’t occur.

Another point was that more than 3 million Syrian immigrants fled their country; many of them went to
Europe. The local people didn't want this unsolicited immigration.

In addition, between the years 2000 to 2016 approximately, many countries were governed by populism
parties. Populism is a phenomenon rooted in Latin America, and in some European countries, was
created in the second half of the twentieth century and lasts until today, is also known as neo populism.
Populism is a social system in which the state provides resources to excluded social classes, through
subsidies or monetary allocations, they are also associated with corruption cases, for example the
former president of Brazil Lula da Silva in Brazil with his party PT, in jail accused of corruption, in
Argentina Nestor Kirchner and Cristina Kirchner Peronist party, prosecuted in numerous corruption
cases, also Alan Garcia , Alejandro Toledo and Pedro Pablo Kuczynsk in Peru, Rafael Correa In Ecuador,
Evo Morales in Bolivia, and Hugo Chavez and Nicolas Maduro in Venezuela and many others.

Populist governments work when the state has economic resources and apply Keynesian economic
policies, Keynes (1936), said that monetary and fiscal policy can manage an economic cycle, that is, with
an economic macro management can generate wealth, it is a fiction that depends on several factors, but
when the state runs out of genuine resources, the impression of money without support and
consequently inflation begins.

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Political Nationalism takes the control

On 1st January 2019, Jair Bolsonaro will be The new President of The Federative Republic of Brazil, the
largest country in Latin America with a population over 208 million with a GDP estimated 1.909 Trillion,
Brazil is the ninth world power.

This retired military officer began his political career with retrograde speeches, such as going against
same-sex marriage, homosexuality is a disease and police that kill thieves have to be decorated.

He was elected with 55,2% BBC News (2018), when in his previous election as a deputy he had only
achieved 6.1% El Pais (2014).

The congratulatory message from the president of the United States Trump,( 2018) was as follows

Had a very good conversation with the newly elected President of Brazil, Jair Bolsonaro, who
won his race by a substantial margin. We agreed that Brazil and the United States will work closely
together on Trade, Military and everything else! Excellent call, wished him congrats!

Donald Trump, a billionaire without a political career, began in 2016 with a protectionist and nationalist
discourse, his leitmotiv was “Make America Great Again”, taken from Ronald Reagan’s (1911-2004)
presidential campaign. On November 8, 2016, he was proclaimed president of the United States

His speeches, radicalized, against illegal immigration, some trade treaties and many measures taken by
his predecessor, such as inclusive capitalism (n.d)

How can we explain the Trump effect , the Bolsonaro effect and Right-wing governments in Europe?

According to Cano, L (2018)

The combination of three factors as an explanation of the succession of electoral victories of the
parties of the right-hand arch. First, confidence in the response to overcome the economic crisis. Second,
the position in the debate on national identity; and third, the collapse of the political adversary: the
social democracy debacle in the case of Europe, and the exhaustion of the populist left in America.

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What is the impact of protectionist governments on world trade