Post Cold-War world is a bastion of economists, strategists and cold calculators. It is a world of vehement competition and mergers in the name of economic intergration and the rise of market power, from the cradle to the grave. While the belligerence of world-wide military conflict recedes, yet the raison detre behind the passion for acquisition and political stratagem out of war, is all over being realized through the instrument of economic power. In this economic power resides institutional functions integrating dominant decisions in view of shared returns from a well-coordinated direction of change by design.
The questions then to ponder over are several in the context of this semblance of economic power: First, is the seemingly market process of economic expansion and integration called privatization, a process launched by the enterprises? By the same question: Is wealth being distributive, resources being shared both intra-and inter-nations in the midst of privatization? Second, to what extent is institutional interaction in the privatization process devoid of political interest? Third, if political interest remain interwined with economic expansion and growth, how does trade, macroeconomic coordination, and the world organizations prepetuate power and strategy?
Is conflict resolution possible in the midst of such dominant power and strategy? Or is it that the global order is inexorably proceeding toward a bi-polar state, although the instruments though not the spirit of globalization, present this global transformation as a unifying one? Where then is the genesis of the problems and their resolution?
The picture of globalization as a process of economic expansion and integration, institutional strategies towards attaining these goals, and long term contract agreements signed internationally and regionally, is painted by the West. Its imitative representations are found in the Pacific Rim, South-East Asia, the Middle East, Eastern Europe, the Commonwealth of Independent States and Russia. All of these developments in global partnership follows the end of Cold War. They picked up momentum with the announcement of a New World Order by George Bush and Gorbachev.
The IMF has been mobilized in Eastern Europe, Russia and the Commonwealth of Independent States. The formation of North American Free Trade Agreement is now being looked upon by the U.S. as a design to extend it to the Asian Pacific Basin by means of Asian Pacific Economic Cooperation. In the development field, World Bank's structural adjustment policies have now entrenched themselves in Official Development Assistance and have combined with IMF conditionalities to determine allowance for loans and assistance. The conclusion of the Uruguay Rounds of Trade Talks aim at globalizing future trade relation's between countries premised on the Bretton Woods surge for transformation in the external sector and in development matters. The future of global trade and market order is seen as an extension of the Most Favoured Nations Clause to all nations in a uniform claim for export orientation, import penetration and open linkages among capital markets.
The above-mentioned initiatives toward globalization are seen to be both a continuance of the old mercantilism, Eurocentricity of the West as well as an entrenchement of the global neoclassical model. We will take up these two parts separately.
Let us view the world balance of payments situation from a mercantilist viewpoint. Mercantilists believed that the wealth of a nation which to them was Britain, depended upon the riches and bullions it could command. To attain this state, mercantilists promoted the development of trade mechanisms (ships); colonial taxation; selling of expensive goods while protecting the British economy against expensive imports but encouraging the import of cheap goods. Through such trade mechanisms, the following relevent kinds of balance of payment relations can be seen to explain present days neo-mercantilism: The focus of the external sector is placed on export orientation. Export in value terms is seen to be a function of nominal protection of profitable goods; whereas, import of cleap raw materials, intermediate technology and commodities, is encouraged. To correct trade deficits, government financial resources using general tax revenues, or offical development resources, or in-flight of capital in high interest bearing assets, are activated. Thus, the level of deficits determines exchange rate, interest rate and protective levels at home against the competitiveness by other nations.
Trade relations in a globalizing order shows all these to exist: For the developing countries, we find a continuation of worsening terms of trade of commodities; lost sectorialcompetitiveness and food self-sufficiency; flight of capital; and extensive external sector volatility. On the other hand, industrialized economies are trying to protect their agricultural and manufacturing sectors against the external flow of goods, such as in textiles, automobiles in the U.S. and in general terms within EC. This is tantamount to selling expensive and buying inputs of production cheap.
Overall deficits in industrialized economies are being mitigated by taxation and by flight of capital from developing countries. Thus, under such a neo-mercantilist order, the drive to secure external sector balances at home under exchange rate flexibility and perfect capital mobility, causes industrialized economies to adopt monetary policies. The interest rate and exchange rate volatility of monetary policies prove to be permanently disequilibrating for the developing countries. The developing countries have been historically selling cheap and buying expensive from the industrialized economies. Thus, both export orientation and capital transactions in the overall balance of payments prove to be permanently de-equalizing.
Problems of Trade and Development Policies of Bretton Woods Institutions.
While many Newly Industrializing Countries will eventually become industrialized, this will be realized by means of foreign trade. But statistics in Table 1 point out for Malaysia, that foreign direct investments being in export-oriented sectors, are not deep in agricultural and agro-based industries. Consequently, under the neoclassical prescription of globalization, social expenditure remains an activity of either national governments or of official development assistance. All of these approaches are conflicting ones in the globalization scene. First, government expenditure and official development are discouraged by structural adjustment under its focus on privatization. Where such transfer incomes exist, they cause a perpetuating dependency syndrome and low factor productivities in the recipients. The poor is thereby, not integrated with world trade and development in a self-reliant way. Finally, IMF conditionality promotes government policies toward export orientation, trade liberalization and external sector balances through the process of privatization. All these work in concert with structural adjustment. Consequently, IMF conditionality is totally targetted to efficiency.
Eurocentric Economic Reasoning and Globalization Process.
1. Neoclassical Individualism.
The above discussion on the nature of economic reasoning based in Western socio-economic models and institutions show that neither neoclassicism nor Keynesianism and their latter days development (monetarism and rational expectations as combination of these two), can resolve the intrinsically de-stabilized nature of globalization. The macroeconomic policy coordination in the West; the neoclassical macro- and micro-economic roots; the Eurocentric dominance of neo-mercantilism; and the dominating nature of Western institutions led by the Bretton Woods institutions, are all interactively reinforcing toward deepening global methodological individualism. In this order, globalization becomes a process of conflict resolution under a dominance model of economic, institutional and strategic hegemony. The same perspective repeats itself either internationally under the Eurocentric model, or regionally by a dominant regional player. Subsequently, this dominant player by its relationship with and as part of the Western model, drives the regional integration process into one global process of competition via strategies.
The Islamic Concept of Globalization for the Muslim World
The next issue then to investigate is whether the dominance and strategically alienating model of global control by the West and intra-communal relations among Islamic countries, is going to end under the present arrangements. We have abundantly shown that globalization as a neo-mercantilist regime carried out in a Eurocentric framework, is part and parcel of the philosophy, methodological individualism and extensive institutional behaviour of the occident. Such a form cannot be implanted in occidental life. Thus, the Eurocentric framework will always be aimed at by the West in its prescription of globalization.
The remaining question to address then is whether the same kind of behaviour that has gripped the Muslim world, will ever cease in favour of the only other alternative -- the Islamic system of globalization. What then is the Islamic prescription of globalization?
1. The Philosophical Premise of Globalization in Islamic Perspective.
The philosophy of Islamic globalization is a unique process of interaction and integration among all kinds of agents and system of thought, institutions and the socio-scientific order, by means of the Unification Principle of God's Unity (Tawhid). The substantive meaning of this Unification Principle (Epistemology) is not simply a static understanding of the Unity of God. Rather, in this, Unity is seen as the dynamic process of reducing all systems to the most irreducible reality that can Unify the systems by the process of integrating them through interactions on the bases of the Islamic laws (Shariah) premised on this Unity. The process of globalization in this philosophical context means the emergence, conduct and convergence of endless cycles of discursion among agents of diverse systems for greater understanding and realization of Shariah, while the axiom of Tawhid remains the immutable foundation of such dynamics.
As an example, such a precept of globalization when applied to the subject matter of human resource development, would mean development of the complementary and interactive-integrative epistemology in and across all disciplines, skills and training. This is an epistemology that is derived from the nature of Tawhidi dynamics, and is subsequently, evolved through relevant instruments of the knowledge process to reinforce the Tawhidi episteme. In the area of human resource development, the normative essence of Tawhidi episteme is integrated with the positivistic essence of the methods and disciplines of learning. The normative essence is called Fard A'yn (obligatory knowledge). Inter-relations between these move in reinforcing cycles. Thus, conflict resolution, complementarity and continuity inter- and intra-systems, become the cause and effect of such a circular process of evolutionary epistemology.
2. Institutional Aspect of Globalization in Islamic Perspective
Next we turn to the institutional aspect of such a globalization methodology. In every Islamic system we have the embryonic textual reference to Shariah, as the interpretation of its tenets apply to the nature and problem of that system in any instance. We may call this embryonic textual reference to a Shuratic interpretive reference, as the polity (Shura). Thus, the concept of Shura is trans-political. It is pervasively embryonic inter- and intra-systems (Al-Qur'an, Chapter Ash-Shura S.42, vs 51-52). The function of the embryonic Shura is to develop rules of life pertaining to the given problems at hand. This is called Ahqam. An Ahqam thereby, represents a preference of polity based on the level of acquired knowledge on the understanding, interpretation and delivery of the rule. Neither the Shura nor the Ahqam can be imposed. They can only be established and reinforced by acceptance of their truth and welfare (Islah and Falah) by the whole system.
The first part of the system being polity (Shura), the other part is the socio-scientific order (e.g. market as a subset of ecology). This system receives the Ahqam as a preference of polity (Shura) aimed at transforming the principal activities and behaviour of the socio-economic order. The market activities of consumption, production and distribution are thus aimed for transformation by the influence of Ahqam. The socio-scientific order thus delivers a social good. In this way, the preferences of polity are examined, accepted, revised or rejected by the socio-scientific order. The resulting preference of the socio-scientific order represent interactively generated preferences between those of Ahqam and the socio-scientific order.
Such responses as interactive preferences from the socio-scientific order are post-evaluated as a learning process in polity (Shura). This response recreates knowledge in Shura as interactions between polity and the socio-scientific order proceed. Consensus or majority rule is established as partial or complete Ijma (Qiyas), as interactions are continued circularly between polity and the socio-scientific order. The circular continuity of the Shariah and Ahqam through interactions and integration is thus seen to be the recreative essence of Tawhidi episteme via the instruments and institutions of change. The totality of the process circularly established and continued between the socio-scientific system as a universally pervasive and embryonic one, is termed here as the Shuratic Process.
3. Application of Shuratic Process to Globalization
Our third task here is to apply the Shuratic Process to globalization through trade and institutionalism. The textual reference to liberalized trade in goods that generate justice, truth and welfare, can be derived from the following Qur'anic Ahqam: And He it is who has made the sea subservient and on that [very sea] one sees ships ploughing through the waves, so that you might [be able to] go forth in quest of some of His bounty, and thus have cause to be grateful [to Him].(S. 16 vs. 14)
The interpretive domain of this Ahqam implies development of useful diversity that reflects Divine Essence: And all the [beauty of] many hues which He has created for you on earth: in this, behold, there is a message for people who [are willing to] take it to heart! (S. 16 vs. 13)
The Shura in this regard is an Islamic World Trade Organization that is linked from down-to-up-to-down with indefinitely large strings of metro-Shura that link upwards. The most micro-level of such Shuras is that of the grassroots, whose preferences are Shuratically evolved by the same process and are represented at higher echelons of Shuras. Likewise, the Ahqam of the Islamic World Trade Organization reflects the interactive-integrative preference of the strings of Shuras. This reflects the intra-Shuratic process in polity.
The socio-scientific order of foreign trade in light of the balance, purpose, truth and welfare, means unification of such a principle through the Ummatic model, since the occidental model is found to remain antagonistic to the unified world view. Thus a system of instruments of liberal managed trade with requisite tariffs, is developed. Other instruments are participatory financial instruments, foreign trade financing and secondary instruments. Trade flows through complementarity, diversity, solidarity and dynamism through evolutionary linkages characteristic of technological change, are thus maximized within the Ummah. Residual trading is then carried out with the non-Muslim world, but still on the same Shuratic principles on a second-best basis.
The delivery of social good on the basis of the above Ahqam is expected to be collective self-reliant development, complementarity and growth arising from the Ummatic diversity; a natural process of commodity price determination in a market that arrests free-ridership on excess supply to the domineering West; and a process of evolutionary learning that reinforces the Unification Principle as the singular premise of reality. While this establishes itself in the Ummah, it subsequently extends itself by the same open and purposeful trading principles to all the world. Such is the reinforcing response from the agents and agencies of the Ummah extending from the grassroots upward and then downward. This would result in interactive preferences between the grassroots, the Islamic World Trade Organization, the strings of Shuras and the Ummah at large. The Shuratic process is thus established and perpetuated.
The market order and its consequence on privatization in the Shuratic world view of globalization are now felicitous orders of balance, growth, goodness, purpose and distributive equity. These cannot be, and methodologically now are not substitutable ends. By the Ahqam and the process of its delivery via precept and institutions/instruments, such ends become complementary because the Unification Epistemology of Tawhid constitutes the unique essence of the world view. Consequently, the Shuratic process model of international trade, globalization and privatization is distinct and polar to the occidental system.
State of Eurocentricity Within the Muslim World
Is the Muslim World at present equipped in its orientation and institutions towards realizing an Islamic globalization process? We return here to the intra-communal individuation, alienation and conflicting model of Western heritage presently being copied by the Muslim world. In the midst of this, neither has there been progress nor institutional development in the Muslim world on the basis of a truly Islamic solidarity.
On examination of the state of trade between OIC members, we get the picture that over the last two decades the flow of trade among OIC members as a percentage of world trade has remained at or about 8.8 percent (1985). On the other hand, the flow of trade from the world to member countries was also low at 7.9 percent; from industrialized countries at 7.7 per cent; from developing countries at 8.0 percent.
The question to wonder about is why such a state of affairs has persisted, when the Western world and the developing countries other than the OIC countries, are fast moving toward globalization? An answer to thie question was provided earlier in the fact, that the Muslim countries being submerged in Eurocentric models, have themselves developed a world system of such individuating and conflicting models. But beyond this explanation is the fact that almost all Muslim governments today have no Islamic legitimacy. They are not affirmed by a genuine Islamic response from the society itself. Within these countries are those who are authoritarian, and hence, a legitimation is not allowed. There are others who are democratic to an extent, but in these an elitist and not a grassroots democracy, exists. Such a democracy is used to legitimate the power of reigning regimes, just as in the case of a Western political philosophy. Contrarily, an Islamic transformation according to its globalizing force must be legitimated through the Shuratic process. This alone as we have seen, is the cause and effect of the philosophy, methodology, institutionalism and application of the Islamic global model.
1. Futility of OIC Resolutions
In recent times, there have been an immense number of resolutions, institutions, committees and conferences on economic and commercial cooperation of the OIC. Yet, far from these becoming thoughtfully and responsibly cementing the sources of globalization in the Muslim World, they have been used for perpetuating Western designs. The example of the continued boycott of Iraq; the alienation of the Sudan; inability to wield influence in the Bosnian conflict; partisan conflict in the Yemens; and deliberate suppression of grassroots Islamic movements by Muslim Governments, are some of the consequences of skewed power structure within the OIC member countries.
In most recent times, the establishing of an Accord between the Palestine Liberation Front and Israel under the guidance of the U.S., is another design of economic hegemony by Israel in the Arab World. Furthermore, by the coming of World Trade Organization and expansion of trade blocs, and subsequently, by extension of the MFN clause, the Israeli hegemony as a stereotyping of Western control of a globalized world, will likely gain high grounds, if the present state of affairs continue. Asa-El writes in this regard: "Shimon Peres, Israel's new/old foreign minister, is the quintessential guru of Middle East economic integration. Now he envisions a Middle Eastern Common market, may be even a NATO-type defensive system. 'There are only two alternatives here', Peres said in a recent interview, 'Benelux or Yugoslavia'".
The Multilateral Trade Organization is unequivocal in its enforcement of Bretton Woods trade and development policies. The MTO document states, "Minister [should] further invite the Director-General of the MTO to review with the Managing Director of the International Monetary Fund and the President of the World Bank, the implications of the MTO's responsibilities for its cooperation with the Bretton Woods institutions, as well as the forms such cooperation might take, with a view to achieving greater coherence in global economic policy making".
In all intents, purposes and consequences, the MTO relegates regional economic cooperations to a monolithic swapping of world trade in one great multilateral trading arrangement. This fact has its early proof in the US opposition to the formation of East Asian Economic Cooperation Pack in most recent developments on trade blocs. In the face of this attitude, differential protection of infant industries under managed trade must weaken to the disadvantage of developing countries; commodity prices will continue to suffer. Manufacturing and technological dependence of developing countries on the North will persist. Agricultural and its agro-based linkages in developing countries will experience falling terms of trade. Consequently, structural transformation based on maximizing of inter-sectorial linkages and inter-communal trade, will get a setback. These consequences would be particularly true of Muslim countries in the present momentum of globalization.
The fact of the matter is that technology based on knowledge development carries with it the cause and effect of particular developmental modes. Technology and science of the occident is inherently socially alienating in both its Darwinist evolutionary episteme and its application via an alienating socio-scientific model. To catch up with this technology is to imitate the scientific nicety of the alienating totality. The adverse consequences for the Muslim World would then not be limited to the socio-economic sphere, but also will spread to the core of Muslim thinking and intensify intellectual bondage/dependency - a thorough Taqlid, blind acceptance of imitated authority.
What the world is truly searching for at this juncture is not a catching up with the old mode of thinking, science and technology, but a unified way of comprehending new scientific epistemologies. It is here that the Muslim World must rise away from imitative catching up to substantively new and authentically own scientific epistemologies. These can subsequently be applied to emerging technologies. It is evidently debilitating that the OIC and its scientific arm, IFSTAD, should be thinking in reverse gear.
The Way Out for Muslim Countries in their Globalization Process
What is then the way out of the Muslim stalemate in realizing authentically Islamic roots of globalization? First, it is to attain two structural changes together. This will comprise a thorough adoption of the prevasively embryonic Shuratic process in socio-scientific thinking. Simultaneously, through grassroots action and agitation, this Shuratic process is to embrace institutional and political change. Secondly, within this institutional change must come about realization of the Shuratic framework of thinking, organization and action in the OIC, the Islamic Development Bank and their sister agencies. If this is not possible, alternative institutions capable of developing Islamic globalization, are to be established within a framework of grassroots democratic change.
Without such a thoroughly authentic Islamic change, the Muslim countries will remain perpetually subservient to the West and will be copying that model for itself. Dominance and external sector instability will characterize any other means of economic cooperation for Muslim countries in the globalization process that is presently on. The realization of the Islamic change does not lie on imitative science and technology catching up. On the contrary, such state-sponsored educational means will further strengthen the unyielding establishment of the OIC member governments.
Contrarily, the realization of Islamic globalization lies on the synergy of the grassroots to self-actualize itself. This grassroot comprises the intellectuals, educational institutions, the poor and deprived, the informed and the entire micro-level of society at large.
Political consciousness toward this end is essential. It must be clear to the agents of change, that the occident in its own may, grew out of Inquisition into the light of its own rationalism. This rythm is pervasive and perpetual in occidentalism. In the bi-polar world that has emerged during post-Cold War period between Islam and the West, the Islamic alternative has to realize itself within its own world view, if the Muslims are to take their alternative seriously.
What is then the conclusion on globalization for the Muslim World? We have shown in this paper that globalization is not an innocent word of occidental goodwill. Just like any other good delivered by the intrinsically conflicting and domineering model of Eurocentricity, globalization too is a product of that category embedded in neo-mercantilism. Thus the foundation of the occidental concept of globalization is founded on its liberal neo-classical type political philosophy. International trade, privatization, market shares, foreign direct investments, are then treated as instruments to realize the Eurocentric capitalist gains. The industrialized nations thus treat these instruments to realize economic interests and strategic interests, either in substitution or by submerging them in one dominance model. We have argued the cases where both of these instances of the Eurocentric model applies. To realize such interests, globalization and its instruments can be easily affected in desired ways by the occidental player by exercise of the two key instruments. These are namely, interest rate and exchange rate mechanisms.
The authentically Islamic meaning and modus operandi of globalization was formalized in the framework of the pervasively embryonic Shuratic process of development and change. The condition for this is reconstruction of thought in the direction of the Tawhidi episteme in the socio-scientific order. This discursively evolutionary knowledge process necessitates transformation of the Muslim countries and their institutions into grassroots democratic institutions as cause and effect of the Shuratic process.
Islamic thought, behaviour, methods, institutions and socio-scientific dynamics in the framework of the Shuratic process, now substantively ethicizes the market order. In the midst of this, the twin concepts of privatization and globalization assume an authentically Islamic meaning. It functionalizies global Islamic solidarity intra-communally first. The same globalization model is then opened up to the rest of the world.
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