With growing concerns that globalization is in retreat amid rising geopolitical tensions, former Secretary of State Condoleezza Rice told an audience of policymakers, business leaders, and academics at the 2023 SIEPR Economic Summit that there’s no turning back on the interdependence of world economies.
“Globalization is a fact, not a policy,” Rice said during a conversation with Mark Duggan — the Trione Director of SIEPR — that toured the world’s major economic and political flashpoints.
But globalization is facing headwinds, Rice said. The strongest, she said, are coming from China where government leaders have failed to meet international expectations of liberalizing the country’s economy.
The U.S. also shoulders some blame for the backlash against globalization, said Rice, who served as the National Security Advisor and Secretary of State under George W. Bush and is now the Tad and Dianne Taube Director at the Hoover Institution.
“Those of us who believe in — and believed in — globalization kind of forgot that it actually didn’t work for everybody,” said Rice, pointing to the toll that offshoring jobs and automation have taken on many American workers, which has diminished support for free trade and heightened the appeal of populism to some.
War in Ukraine
On the war in Ukraine, Rice said that Russian President Vladimir Putin believes “he’s got time on his side” despite having won nothing after a series of miscalculations. It’s too soon to know the effects US-led sanctions are having on the Russian economy, she said. We also are yet to know how the use of sanctions in the current conflict will impact the central role of the dollar in global financial markets over the long-term.
Optimism in the Middle East
Rice said that serious challenges remain in the Middle East, but she now uses a word to describe the region that she never would have before: optimism. She cited the Gulf states’ rapprochement with Israel, among other recent developments in the region, as evidence that leaders in those countries are modernizers interested in diversifying their economies. And in Iran, where 70 percent of the population is under the age of 30, civil unrest and protest are challenging an oppressive government and demanding change.
India: The future is now
India’s time has come, Rice said. Set to surpass China as the world’s largest country by population, India has made significant progress on improving its infrastructure, education, manufacturing, and trade policies.
“You feel sometimes with India [that the economic promise is] always in the future,” Rice said. But on a recent visit to the country with a delegation of scholars from the Hoover Institution, “it did seem to me that things are on the move.”
For example, she learned how India had run its COVID-19 vaccination program through biometric IDs, which the vast majority of Indians now have.
“’Let me show you how a really technologically sophisticated country handled [vaccination documentation],’” Rice recalled telling Indian officials of the U.S. approach. “And I pulled out my tattered vaccine card.”
Promise in Africa
When asked by Duggan to identify regions of the world that are doing better than expected, Rice singled out Africa. “Unfortunately, the big weighty states like South Africa and Nigeria continue to have their problems,” she said. “But across Africa, you’re seeing fewer presidents for life. You’re seeing a growing middle class.”
There are signs, too, that China is pulling back on its Belt and Road Initiative to extend its economic and political influence in the region. “We ought to be right in the middle of that, going into that vacuum,” she said.